Document:

RESIDENTIAL ASSET MORTGAGE PRODUCTS, INC.,

                                   Depositor,

                        RESIDENTIAL FUNDING CORPORATION,

                                Master Servicer,

                                       and

                         BANK ONE, NATIONAL ASSOCIATION

                                     Trustee

                         POOLING AND SERVICING AGREEMENT

                           Dated as of October 1, 2001

                 Mortgage Asset-Backed Pass-Through Certificates

                                 Series 2001-RS3

<PAGE>

<TABLE>
<CAPTION>
                                                 TABLE OF CONTENTS

<S>                                                                                                              <C>
ARTICLE I

DEFINITIONS
         Section 1.01.     Definitions............................................................................5
                  Accrued Certificate Interest....................................................................5
                  Adjusted Mortgage Rate..........................................................................6
                  Adjustment Date.................................................................................6
                  Advance.........................................................................................6
                  Affiliate.......................................................................................6
                  Agreement.......................................................................................6
                  Amount Held for Future Distribution.............................................................6
                  Appraised Value.................................................................................6
                  Arrearage.......................................................................................7
                  Assignment......................................................................................7
                  Assignment Agreement............................................................................7
                  Assignment of Proprietary Lease.................................................................7
                  Balloon Loan....................................................................................7
                  Balloon Payment.................................................................................7
                  Bankruptcy Code.................................................................................7
                  Bankruptcy Loss.................................................................................7
                  Basis Risk Shortfall............................................................................7
                  Basis Risk Shortfall Carry-Forward Amount.......................................................7
                  Book-Entry Certificate..........................................................................8
                  Business Day....................................................................................8
                  Calendar Quarter................................................................................8
                  Certificate.....................................................................................8
                  Certificate Account.............................................................................8
                  Certificate Account Deposit Date................................................................8
                  Certificateholder or Holder.....................................................................8
                  Certificate Insurer Premium.....................................................................9
                  Certificate Insurer Premium Modified Rate.......................................................9
                  Certificate Insurer Premium Rate................................................................9
                  Certificate Owner...............................................................................9
                  Certificate Principal Balance...................................................................9
                  Certificate Register and Certificate Registrar.................................................10
                  Class..........................................................................................10
                  Class A Certificates...........................................................................10
                  Class A-I Certificates.........................................................................10
                  Class A-I-1 Certificate........................................................................10
                  Class A-I-2 Certificate........................................................................10
                  Class A-I-3 Certificate........................................................................10
                  Class A-I-4 Certificate........................................................................10

                                                         i

<PAGE>

                  Class A-I-5 Certificate........................................................................11
                  Class A-I-5 Lockout Distribution Amount........................................................11
                  Class A-I-5 Lockout Percentage.................................................................11
                  Class A-I-5 Pro Rata Distribution Amount.......................................................11
                  Class A-I-IO Certificate.......................................................................11
                  Class A-II Certificate.........................................................................12
                  Class A-II Margin..............................................................................12
                  Class R Certificate............................................................................12
                  Class R-I Certificate..........................................................................12
                  Class R-II Certificate.........................................................................12
                  Class R-III Certificate........................................................................12
                  Class R-IV Certificate.........................................................................12
                  Class SB Certificates..........................................................................12
                  Class SB-I Certificate.........................................................................12
                  Class SB-II Certificate........................................................................12
                  Closing Date...................................................................................13
                  Code...........................................................................................13
                  Compensating Interest..........................................................................13
                  Converted Mortgage Loan........................................................................13
                  Cooperative....................................................................................13
                  Cooperative Apartment..........................................................................13
                  Cooperative Lease..............................................................................13
                  Cooperative Loans..............................................................................13
                  Cooperative Stock..............................................................................13
                  Cooperative Stock Certificate..................................................................13
                  Corporate Trust Office.........................................................................14
                  Curtailment....................................................................................14
                  Custodial Account..............................................................................14
                  Custodial Agreement............................................................................14
                  Custodian......................................................................................14
                  Cut-off Date...................................................................................14
                  Cut-off Date Balance...........................................................................14
                  Cut-off Date Principal Balance.................................................................14
                  Debt Service Reduction.........................................................................14
                  Deferred Interest..............................................................................14
                  Deficiency Amount..............................................................................14
                  Deficient Valuation............................................................................15
                  Definitive Certificate.........................................................................15
                  Deleted Mortgage Loan..........................................................................15
                  Delinquency Ratio..............................................................................15
                  Delinquent.....................................................................................15
                  Depository.....................................................................................15
                  Depository Participant.........................................................................16
                  Destroyed Mortgage Note........................................................................16
                  Determination Date.............................................................................16
                  Disqualified Organization......................................................................16

                                                        ii

<PAGE>

                  Distribution Date..............................................................................16
                  Due Date.......................................................................................16
                  Due Period.....................................................................................16
                  Eligible Account...............................................................................16
                  ERISA..........................................................................................17
                  Event of Default...............................................................................17
                  Excess Overcollateralization Amount............................................................17
                  Excess Realized Loss...........................................................................17
                  Extraordinary Events...........................................................................17
                  Fannie Mae.....................................................................................18
                  FASIT..........................................................................................18
                  FDIC...........................................................................................18
                  FHA............................................................................................18
                  Final Distribution Date........................................................................18
                  Final Scheduled Distribution Date..............................................................18
                  Fitch..........................................................................................18
                  Foreclosure Profits............................................................................18
                  Foreclosure Restricted Loan....................................................................19
                  Fraud Losses...................................................................................19
                  Freddie Mac....................................................................................19
                  Gross Margin...................................................................................19
                  Group I Adjusted Net WAC Rate..................................................................19
                  Group I Available Distribution Amount..........................................................20
                  Group II Available Distribution Amount.........................................................20
                  Group I Bankruptcy Amount......................................................................20
                  Group II Bankruptcy Amount.....................................................................21
                  Group I Cumulative Insurance Payments..........................................................21
                  Group II Cumulative Insurance Payments.........................................................21
                  Group I Cut-off Date Balance...................................................................21
                  Group II Cut-off Date Balance..................................................................21
                  Group I Diverted Excess Spread.................................................................21
                  Group II Diverted Excess Spread................................................................21
                  Group I Excess Bankruptcy Loss.................................................................22
                  Group II Excess Bankruptcy Loss................................................................22
                  Group I Excess Cash Flow.......................................................................22
                  Group II Excess Cash Flow......................................................................22
                  Group I Excess Fraud Loss......................................................................22
                  Group II Excess Fraud Loss.....................................................................22
                  Group I Excess Loss............................................................................22
                  Group II Excess Loss...........................................................................22
                  Group I Excess Overcollateralization Amount....................................................22
                  Group II Excess Overcollateralization Amount...................................................22
                  Group I Excess Special Hazard Loss.............................................................22
                  Group II Excess Special Hazard Loss............................................................22
                  Group I Extraordinary Losses...................................................................22
                  Group II Extraordinary Losses..................................................................22

                                                        iii

<PAGE>

                  Group I Fraud Loss Amount......................................................................23
                  Group II Fraud Loss Amount.....................................................................23
                  Group I Interest Distribution Amount...........................................................24
                  Group I Loan...................................................................................24
                  Group II Loan..................................................................................24
                  Group I Optional Termination Date..............................................................24
                  Group II Optional Termination Date.............................................................24
                  Group I Overcollateralization Amount...........................................................24
                  Group II Overcollateralization Amount..........................................................24
                  Group I Overcollateralization Increase Amount..................................................24
                  Group II Overcollateralization Increase Amount.................................................24
                  Group I Overcollateralization Reduction Amount.................................................25
                  Group II Overcollateralization Reduction Amount................................................25
                  Group I Pool Stated Principal Balance..........................................................25
                  Group II Pool Stated Principal Balance.........................................................25
                  Group I Principal Distribution Amount..........................................................25
                  Group II Principal Distribution Amount.........................................................25
                  Group I Required Overcollateralization Amount..................................................26
                  Group II Required Overcollateralization Amount.................................................26
                  Group I Special Hazard Amount..................................................................27
                  Group II Special Hazard Amount.................................................................27
                  Group I Stepdown Date..........................................................................28
                  Group II Stepdown Date.........................................................................28
                  Group I Uncertificated Regular Interests.......................................................28
                  Group II Uncertificated Regular Interests......................................................28
                  Group I Weighted Average Net Mortgage Rate.....................................................28
                  Group II Weighted Average Net Mortgage Rate....................................................28
                  Group II Weighted Average Actual/360 Net Mortgage Rate.........................................28
                  Hazardous Materials............................................................................28
                  High Cost Loan.................................................................................29
                  HomeComings....................................................................................29
                  Independent....................................................................................29
                  Index..........................................................................................29
                  Initial Certificate Principal Balance..........................................................29
                  Insurance Account..............................................................................29
                  Insurance Agreement............................................................................29
                  Insurance Proceeds.............................................................................29
                  Insured Amount.................................................................................29
                  Insurer........................................................................................29
                  Insurer Account................................................................................30
                  Insurer Default................................................................................30
                  Interest Accrual Period........................................................................30
                  Interim Certification..........................................................................30
                  Interested Person..............................................................................30
                  Late Collections...............................................................................30
                  Late Payment Rate..............................................................................30

                                                        iv

<PAGE>

                  LIBOR..........................................................................................30
                  LIBOR Business Day.............................................................................30
                  LIBOR Certificates.............................................................................31
                  LIBOR Rate Adjustment Date.....................................................................31
                  Liquidation Proceeds...........................................................................31
                  Loan-to-Value Ratio............................................................................31
                  Marker Rate....................................................................................31
                  Maturity Date..................................................................................31
                  Maximum Class A-I-1 Rate.......................................................................32
                  Maximum Class A-II Rate........................................................................32
                  Maximum Mortgage Rate..........................................................................32
                  Maximum Net Mortgage Rate......................................................................32
                  MERS...........................................................................................32
                  MERS(R)System...................................................................................32
                  MIN............................................................................................32
                  Minimum Mortgage Rate..........................................................................32
                  Modified Mortgage Loan.........................................................................32
                  MOM Loan.......................................................................................32
                  Monthly Payment................................................................................32
                  Moody's........................................................................................33
                  Mortgage.......................................................................................33
                  Mortgage File..................................................................................33
                  Mortgage Loan Accrued Interest.................................................................33
                  Mortgage Loan Schedule.........................................................................33
                  Mortgage Loans.................................................................................34
                  Mortgage Note..................................................................................34
                  Mortgage Rate..................................................................................35
                  Mortgaged Property.............................................................................35
                  Mortgagor......................................................................................35
                  Neg Am Loan....................................................................................35
                  Net Collections................................................................................35
                  Net Mortgage Rate..............................................................................35
                  Non-Primary Residence Loans....................................................................35
                  Non-United States Person.......................................................................35
                  Nonrecoverable Advance.........................................................................35
                  Nonsubserviced Mortgage Loan...................................................................36
                  Note Margin....................................................................................36
                  Notice.........................................................................................36
                  Notional Amount................................................................................36
                  Officers' Certificate..........................................................................36
                  Opinion of Counsel.............................................................................36
                  Outstanding Mortgage Loan......................................................................37
                  Ownership Interest.............................................................................37
                  Pass-Through Rate..............................................................................37
                  Paying Agent...................................................................................38
                  Percentage Interest............................................................................38

                                                         v

<PAGE>

                  Periodic Cap...................................................................................38
                  Permitted Investments..........................................................................38
                  Permitted Transferee...........................................................................39
                  Person.........................................................................................39
                  Policy.........................................................................................39
                  Prepayment Assumption..........................................................................40
                  Prepayment Interest Shortfall..................................................................40
                  Prepayment Period..............................................................................40
                  Primary Insurance Policy.......................................................................40
                  Principal Prepayment...........................................................................40
                  Principal Prepayment in Full...................................................................40
                  Program Guide..................................................................................40
                  Purchase Price.................................................................................40
                  Qualified Insurer..............................................................................41
                  Qualified Substitute Mortgage Loan.............................................................41
                  Rating Agency..................................................................................41
                  Realized Loss..................................................................................41
                  Record Date....................................................................................42
                  Regular Certificates...........................................................................42
                  Regular Interest...............................................................................42
                  Relief Act.....................................................................................42
                  REMIC..........................................................................................42
                  REMIC Administrator............................................................................42
                  REMIC I........................................................................................42
                  REMIC I Regular Interests......................................................................43
                  REMIC I Regular Interest LT-A-1................................................................43
                  REMIC I Regular Interest LT-A-2................................................................43
                  REMIC I Regular Interest LT-A-3................................................................43
                  REMIC II.......................................................................................43
                  REMIC II Regular Interest......................................................................43
                  REMIC II Regular Interest LT-B.................................................................43
                  REMIC III......................................................................................44
                  REMIC III Group I Diverted Excess Spread.......................................................44
                  REMIC III Group II Diverted Excess Spread......................................................44
                  REMIC III Group I Interest Loss Allocation Amount..............................................44
                  REMIC III Group II Interest Loss Allocation Amount.............................................44
                  REMIC III Group I Overcollateralized Amount....................................................44
                  REMIC III Group II Overcollateralized Amount...................................................44
                  REMIC III Group I Principal Loss Allocation Amount.............................................44
                  REMIC III Group II Principal Loss Allocation Amount............................................44
                  REMIC III Group I Regular Interests............................................................44
                  REMIC III Group II Regular Interests...........................................................45
                  REMIC III Group I Required Overcollateralization Amount........................................45
                  REMIC III Group II Required Overcollateralized Amount..........................................45
                  REMIC III Regular Interest LT1-I...............................................................45
                  REMIC III Regular Interest MT-I-2..............................................................45

                                                        vi

<PAGE>

                  REMIC III Regular Interest MT-I-3..............................................................45
                  REMIC III Regular Interest MT-I-4..............................................................45
                  REMIC III Regular Interest MT-I-5..............................................................45
                  REMIC III Regular Interest MT-I-6..............................................................45
                  REMIC III Regular Interest MT-I-7..............................................................45
                  REMIC III Regular Interest MT-I-7 Maximum Interest Deferral Amount.............................46
                  REMIC III Regular Interest MT-I-IO.............................................................46
                  REMIC III Regular Interest MT-II-1.............................................................46
                  REMIC III Regular Interest MT-II-2.............................................................46
                  REMIC III Regular Interest MT-II-3.............................................................46
                  REMIC III Regular Interest MT-II-3 Maximum Interest Deferral Amount............................46
                  REMIC IV.......................................................................................47
                  REMIC Provisions...............................................................................47
                  REO Acquisition................................................................................47
                  REO Disposition................................................................................47
                  REO Imputed Interest...........................................................................47
                  REO Property...................................................................................47
                  Re-Performing Loans............................................................................47
                  Repurchase Event...............................................................................47
                  Repurchase Price...............................................................................48
                  Request for Release............................................................................48
                  Required Insurance Policy......................................................................48
                  Reserve Fund...................................................................................48
                  Reserve Fund Deposit...........................................................................48
                  Reserve Fund Residual Right....................................................................48
                  Residential Funding............................................................................48
                  Responsible Officer............................................................................48
                  Rolling Six-Month Delinquency Ratio............................................................49
                  Security Agreement.............................................................................49
                  Servicer Bailee Loan...........................................................................49
                  Servicing Accounts.............................................................................49
                  Servicing Advances.............................................................................49
                  Servicing Fee..................................................................................49
                  Servicing Fee Rate.............................................................................49
                  Servicing Modification.........................................................................49
                  Servicing Officer..............................................................................49
                  Servicing Trigger..............................................................................50
                  Simple Interest Loan...........................................................................50
                  Special Hazard Loss............................................................................50
                  Standard & Poor's..............................................................................50
                  Startup Date...................................................................................50
                  Stated Principal Balance.......................................................................50
                  Subordination..................................................................................51
                  Subserviced Mortgage Loan......................................................................51
                  Subservicer....................................................................................51
                  Subservicer Advance............................................................................51

                                                        vii

<PAGE>

                  Subservicing Account...........................................................................51
                  Subservicing Agreement.........................................................................51
                  Subservicing Fee...............................................................................51
                  Tax Returns....................................................................................51
                  Transfer.......................................................................................51
                  Transferee.....................................................................................52
                  Transferor.....................................................................................52
                  Trust Fund.....................................................................................52
                  Twelve-Month Loss Amount.......................................................................52
                  Uniform Single Attestation Program for Mortgage Bankers........................................52
                  Uncertificated Accrued Interest................................................................52
                  Uncertificated Notional Amount.................................................................53
                  Uncertificated Pass-Through Rate...............................................................53
                  Uncertificated Principal Balance...............................................................53
                  Uncertificated Regular Interests...............................................................53
                  Uncertificated REMIC I Pass-Through Rate.......................................................53
                  Uncertificated REMIC II Pass-Through Rate......................................................53
                  Uncertificated REMIC III Pass-Through Rate.....................................................53
                  Uninsured Cause................................................................................54
                  VA.............................................................................................54
                  Voting Rights..................................................................................54
         Section 1.02.     Determination of LIBOR................................................................54

ARTICLE II

CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
         Section 2.01.     Conveyance of Mortgage Loans..........................................................56
         Section 2.02.     Acceptance by Trustee.................................................................60
         Section 2.03.     Representations, Warranties and Covenants of the Master Servicer and the
                           Depositor.............................................................................61
         Section 2.04.     Representations and Warranties of Residential Funding.................................63
         Section 2.05.     Execution and Authentication of Certificates; Conveyance of Uncertificated
                           REMIC Regular Interests...............................................................65

ARTICLE III

ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
         Section 3.01.     Master Servicer to Act as Servicer....................................................67
         Section 3.02.     Subservicing Agreements Between Master Servicer and Subservicers;
                           Enforcement of Subservicers' Obligations..............................................68
         Section 3.03.     Successor Subservicers................................................................69
         Section 3.04.     Liability of the Master Servicer......................................................70

                                                       viii

<PAGE>

         Section 3.05.     No Contractual Relationship Between Subservicer and Trustee or
                           Certificateholders....................................................................70
         Section 3.06.     Assumption or Termination of Subservicing Agreements by Trustee.......................70
         Section 3.07.     Collection of Certain Mortgage Loan Payments; Deposits to Custodial
                           Account...............................................................................71
         Section 3.08.     Subservicing Accounts; Servicing Accounts.............................................73
         Section 3.09.     Access to Certain Documentation and Information Regarding the Mortgage
                           Loans.................................................................................74
         Section 3.10.     Permitted Withdrawals from the Custodial Account......................................74
         Section 3.11.     Maintenance of Primary Insurance Coverage.............................................76
         Section 3.12.     Maintenance of Fire Insurance and Omissions and Fidelity Coverage.....................76
         Section 3.13.     Enforcement of Due-on-Sale Clauses; Assumption and Modification
                           Agreements; Certain Assignments.......................................................78
         Section 3.14.     Realization Upon Defaulted Mortgage Loans.............................................80
         Section 3.15.     Trustee to Cooperate; Release of Mortgage Files.......................................83
         Section 3.16.     Servicing and Other Compensation; Compensating Interest...............................84
         Section 3.17.     Reports to the Trustee and the Depositor..............................................85
         Section 3.18.     Annual Statement as to Compliance.....................................................85
         Section 3.19.     Annual Independent Public Accountants' Servicing Report...............................86
         Section 3.20.     Right of the Depositor in Respect of the Master Servicer..............................86

ARTICLE IV

PAYMENTS TO CERTIFICATEHOLDERS
         Section 4.01.     Certificate Account...................................................................88
         Section 4.02.     Distributions.........................................................................88
         Section 4.03.     Statements to Certificateholders......................................................98
         Section 4.04.     Distribution of Reports to the Trustee and the Depositor; Advances by the
                           Master Servicer......................................................................100
         Section 4.05.     Allocation of Realized Losses........................................................102
         Section 4.06.     Reports of Foreclosures and Abandonment of Mortgaged Property........................103
         Section 4.07.     Optional Purchase of Defaulted Mortgage Loans........................................104
         Section 4.08.     The Policy...........................................................................104
         Section 4.09.     Distribution of Basis Risk Shortfall Carry-Forward Amount; Reserve Fund..............105
         Section 4.10.     Special Report to Insurer............................................................106

ARTICLE V

THE CERTIFICATES
         Section 5.01.     The Certificates.....................................................................107
         Section 5.02.     Registration of Transfer and Exchange of Certificates................................108
         Section 5.03.     Mutilated, Destroyed, Lost or Stolen Certificates....................................113
         Section 5.04.     Persons Deemed Owners................................................................113

                                                        ix

<PAGE>

         Section 5.05.     Appointment of Paying Agent..........................................................113

ARTICLE VI

THE DEPOSITOR AND THE MASTER SERVICER
         Section 6.01.     Respective Liabilities of the Depositor and the Master Servicer......................115
         Section 6.02.     Merger or Consolidation of the Depositor or the Master Servicer; Assignment
                           of Rights and Delegation of Duties by Master Servicer................................115
         Section 6.03.     Limitation on Liability of the Depositor, the Master Servicer and Others.............116
         Section 6.04.     Depositor and Master Servicer Not to Resign..........................................116

ARTICLE VII

DEFAULT
         Section 7.01.     Events of Default....................................................................118
         Section 7.02.     Trustee or Depositor to Act; Appointment of Successor................................119
         Section 7.03.     Notification to Certificateholders...................................................121
         Section 7.04.     Waiver of Events of Default..........................................................121
         Section 7.05.     Servicing Trigger; Removal of Master Servicer........................................121

ARTICLE VIII

CONCERNING THE TRUSTEE
         Section 8.01.     Duties of Trustee....................................................................123
         Section 8.02.     Certain Matters Affecting the Trustee................................................124
         Section 8.03.     Trustee Not Liable for Certificates or Mortgage Loans................................126
         Section 8.04.     Trustee May Own Certificates.........................................................126
         Section 8.05.     Master Servicer to Pay Trustee's Fees and Expenses; Indemnification..................126
         Section 8.06.     Eligibility Requirements for Trustee.................................................127
         Section 8.07.     Resignation and Removal of the Trustee...............................................127
         Section 8.08.     Successor Trustee....................................................................128
         Section 8.09.     Merger or Consolidation of Trustee...................................................129
         Section 8.10.     Appointment of Co-Trustee or Separate Trustee........................................129
         Section 8.11.     Appointment of Custodians............................................................130

ARTICLE IX

TERMINATION

                                                         x

<PAGE>

         Section 9.01.     Termination Upon Purchase by the Master Servicer or Liquidation of All
                           Mortgage Loans.......................................................................131
         Section 9.02.     Additional Termination Requirements..................................................133

ARTICLE X

REMIC PROVISIONS
         Section 10.01.    REMIC Administration.................................................................135
         Section 10.02.    Master Servicer, REMIC Administrator and Trustee Indemnification
                                                                                                                138

ARTICLE XI

MISCELLANEOUS PROVISIONS
         Section 11.01.    Amendment............................................................................140
         Section 11.02.    Recordation of Agreement; Counterparts...............................................142
         Section 11.03.    Limitation on Rights of Certificateholders...........................................143
         Section 11.04.    Governing Law........................................................................143
         Section 11.05.    Notices..............................................................................143
         Section 11.06.    Notices to Rating Agencies and the Insurer...........................................144
         Section 11.07.    Severability of Provisions...........................................................145
         Section 11.08.    Supplemental Provisions for Resecuritization.........................................145
         Section 11.09.    Rights of the Insurer................................................................146
</TABLE>

                                       xi

<PAGE>

Exhibit A         Form of Class A Certificate
Exhibit B         Form of Class SB Certificate
Exhibit C         [Reserved]
Exhibit D         Form of Class R Certificate
Exhibit E         Form of Custodial Agreement
Exhibit F-1       Group I Loan Schedule
Exhibit F-2       Group II Loan Schedule
Exhibit G         Forms of Request for Release
Exhibit H-1       Form of Transfer Affidavit and Agreement
Exhibit H-2       Form of Transferor Certificate
Exhibit I         Form of Investor Representation Letter
Exhibit J         Form of Transferor Representation Letter
Exhibit K         Text of Amendment to Pooling and Servicing Agreement Pursuant
                  to Section 11.01(e) for a Limited Guaranty
Exhibit L         Form of Limited Guaranty
Exhibit M         Form of Lender Certification for Assignment of Mortgage Loan
Exhibit N         Form of Rule 144A Investment Representation
Exhibit O         High Cost Loans
Exhibit P         Form of ERISA Letter
Exhibit Q         Certificate Guaranty Insurance Policy
Exhibit R         List of Re-Performing Loans
Exhibit S         List of Foreclosure Restricted Loans

                                       xii

<PAGE>

         This Pooling and Servicing Agreement, effective as of October 1, 2001,
among RESIDENTIAL ASSET MORTGAGE PRODUCTS, INC., as the depositor (together with
its permitted successors and assigns, the "Depositor"), RESIDENTIAL FUNDING
CORPORATION, as master servicer (together with its permitted successors and
assigns, the "Master Servicer"), and BANK ONE, NATIONAL ASSOCIATION, a national
banking association (formerly known as The First National Bank of Chicago), as
trustee (together with its permitted successors and assigns, the "Trustee").

                             PRELIMINARY STATEMENT:

         The Depositor intends to sell mortgage asset-backed pass-through
certificates (collectively, the "Certificates"), to be issued hereunder in
thirteen classes, which in the aggregate will evidence the entire beneficial
ownership interest in the Mortgage Loans (as defined herein).

                                     REMIC I

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

<TABLE>
<CAPTION>
                                                            UNCERTIFICATED REMIC I             LATEST POSSIBLE
       DESIGNATION             PASS-THROUGH RATE              PRINCIPAL BALANCE                 MATURITY DATE
<S>                            <C>                     <C>                                     <C>
         LT-A-1                   Variable(1)          $        329,669,492.00                 October 25, 2031
         LT-A-2                   Variable(1)          $          9,423,000.00                 October 25, 2031
         LT-A-3                   Variable(1)          $         37,677,000.00                 October 25, 2031
</TABLE>

---------------
(1)      Calculated as provided in the definition of Uncertificated REMIC I
         Pass-Through Rate.

                                    REMIC II
                                    --------

         As provided herein, the REMIC Administrator will make an election to
treat the segregated pool of assets consisting of the Group II Loans and certain
other related assets subject to this Agreement as a REMIC for federal income tax
purposes, and such segregated pool of assets will be designated as "REMIC II."
The Class R-II Certificates will represent the sole class of "residual
interests" in REMIC II for purposes of the REMIC Provisions under federal income
tax law. The following table irrevocably sets forth the designation, remittance
rate (the "Uncertificated REMIC II Pass-Through Rate") and initial
Uncertificated Principal Balance for the "regular interest" in

                                        1

<PAGE>

REMIC II (the "REMIC II Regular Interest"). The "latest possible maturity date"
(determined solely for purposes of satisfying Treasury regulation Section
1.860G-1(a)(4)(iii)) for the REMIC II Regular Interest shall be the Distribution
Date following the last scheduled monthly payment of the Group II Mortgage
Loans. The REMIC II Regular Interest will not be certificated.

<TABLE>
<CAPTION>
                                                           UNCERTIFICATED REMIC II             LATEST POSSIBLE
       DESIGNATION             PASS-THROUGH RATE              PRINCIPAL BALANCE                 MATURITY DATE
       -----------             -----------------              -----------------                 -------------
<S>                            <C>                     <C>                                     <C>
           LTB                    Variable(1)          $       148,231,351.00                  October 25, 2031
</TABLE>

---------------
(1)      Calculated as provided in the definition of Uncertificated REMIC II
         Pass-Through Rate.

                                    REMIC III
                                    ---------

         As provided herein, the REMIC Administrator will make an election to
treat the segregated pool of assets consisting of the REMIC I Regular Interests
and the REMIC II Regular Interests (exclusive of the Reserve Fund) subject to
this Agreement as a REMIC for federal income tax purposes, and such segregated
pool of assets will be designated as "REMIC III." The Class R-III Certificates
will represent the sole class of "residual interests" in REMIC III for purposes
of the REMIC Provisions under federal income tax law. The following table
irrevocably sets forth the designation, remittance rate (the "Uncertificated
REMIC III Pass-Through Rate") and initial Uncertificated Principal Balance for
each of the "regular interests" in REMIC III (the "REMIC III Regular
Interests"). The "latest possible maturity date" (determined solely for purposes
of satisfying Treasury regulation Section 1.860G-1(a)(4)(iii)) for each REMIC
III Regular Interest shall be the Distribution Date following the last scheduled
monthly payment of the Group I Mortgage Loans and the Group II Mortgage Loans.
None of the REMIC III Regular Interests will be certificated.

<TABLE>
<CAPTION>
                                                           UNCERTIFICATED REMIC III            LATEST POSSIBLE
       DESIGNATION             PASS-THROUGH RATE              PRINCIPAL BALANCE                 MATURITY DATE
<S>                            <C>                         <C>                                 <C>
         MT-I-1                   Variable(1)                   $369,234,102.16                October 25, 2031
         MT-I-2                   Variable(1)                      1,388,000.00                October 25, 2031
         MT-I-3                   Variable(1)                        758,000.00                October 25, 2031
         MT-I-4                   Variable(1)                        500,000.00                October 25, 2031
         MT-I-5                   Variable(1)                        744,920.00                October 25, 2031
         MT-I-6                   Variable(1)                        376,770.00                October 25, 2031
         MT-I-7                   Variable(1)                      3,767,699.84                October 25, 2031
         MT-I-IO                     6.00%                                 0.00(2)             October 25, 2031
         MT-II-1                  Variable(1)                    145,266,723.98                October 25, 2031
         MT-II-2                  Variable(1)                      1,482,310.00                October 25, 2031
         MT-II-3                  Variable(1)                      1,482,317.02                October 25, 2031
</TABLE>

---------------
(1)      Calculated as provided in the definition of Uncertificated REMIC III
         Pass-Through Rate.

                                        2

<PAGE>

(2)      REMIC III Regular Interest MT-I-IO does not have an Uncertificated
         Principal Balance. For the purpose of calculating interest payments,
         interest will accrue on a notional amount initially equal to
         $47,100,000.00.

                                    REMIC IV
                                    --------

         As provided herein, the REMIC Administrator will elect to treat the
segregated pool of assets consisting of the REMIC III Regular Interests as a
REMIC for federal income tax purposes, and such segregated pool of assets will
be designated as REMIC IV. The Class R-IV Certificates will represent the sole
class of "residual interests" in REMIC IV for purposes of the REMIC Provisions
under federal income tax law. The following table irrevocably sets forth the
designation, Pass-Through Rate, aggregate Initial Certificate Principal Balance,
certain features, Maturity Date and initial ratings for each Class of
Certificates comprising the interests representing "regular interests" in REMIC
IV. The "latest possible maturity date" (determined solely for purposes of
satisfying Treasury Regulation Section 1.860G-1(a)(4)(iii)) for each Class of
REMIC IV Regular Certificates shall be the Distribution Date following the last
scheduled monthly payment of the Group I Mortgage Loans and the Group II
Mortgage Loans, except for the Class A-I-IO Certificates for which it shall be
the 30th Distribution Date.

<TABLE>
<CAPTION>
                                              AGGREGATE INITIAL
                              PASS-THROUGH-      CERTIFICATE
  DESIGNATION        TYPE          RATE       PRINCIPAL BALANCE         FEATURES       MATURITY DATE      INITIAL RATINGS
  -----------        ----          ----       -----------------         --------       -------------      ---------------
                                                                                                          S&P      MOODY'S
<S>                 <C>      <C>              <C>                   <C>              <C>                  <C>        <C>
                                                                        Senior/
  Class A-I-1       Senior   Adjustable(1)(2)   $ 138,800,000.00    Adjustable Rate  October 25, 2031     AAA        Aaa
  Class A-I-2       Senior       4.60%(2)       $  75,800,000.00         Senior      October 25, 2031     AAA        Aaa
  Class A-I-3       Senior       5.50%(2)       $  50,000,000.00         Senior      October 25, 2031     AAA        Aaa
  Class A-I-4       Senior     6.29%(2)(3)      $  74,492,000.00         Senior      October 25, 2031     AAA        Aaa
  Class A-I-5       Senior       5.70%(2)       $  37,677,000.00     Senior/Lockout  October 25, 2031     AAA        Aaa
                                                                    Senior/Interest
  Class A-I-IO      Senior     6.00%(2)(4)      $           0.00(6)       Only        April 25, 2004      AAA        Aaa
                                                                        Senior/
   Class A-II       Senior   Adjustable(2)(3)   $ 148,231,000.00    Adjustlabe Rate  October 25, 2031     AAA        Aaa
   Class SB-I     Subordinate Adjustable(5)     $         492.03      Subordinate    October 25, 2031     N/R        N/R
  Class SB-II     Subordinate Adjustable(5)     $         350.80      Subordinate    October 25, 2031     N/R        N/R
   Class R-I       Residual        N/A                       N/A        Residual     October 25, 2031     N/R        N/R
   Class R-II      Residual        N/A                       N/A        Residual     October 25, 2031     N/R        N/R
  Class R-III      Residual        N/A                       N/A        Residual     October 25, 2031     N/R        N/R
   Class R-IV      Residual        N/A                       N/A        Residual     October 25, 2031     N/R        N/R
</TABLE>

---------------
(1)      Calculated in accordance with the definition of "Pass-Through Rate"
         herein.
(2)      Subject to a cap as described in the definition of "Pass-Through Rate"
         herein. Calculated in accordance with the definition of "Pass-Through
         Rate" herein.
(3)      On and after the first Distribution Date after the first possible Group
         I Optional Termination Date, the Pass-Through Rate on the Class A-I-4
         Certificates will increase by a per annum rate equal to 0.50%. On and
         after the first Distribution Date after the first possible Group II
         Optional Termination Date, the margin on the Class A-II Certificates
         will double.
(4)      The Pass-Through Rate for the Class A-I-IO Certificates will be 6.00%
         per annum for the November 2001 through April 2004 Distribution Dates.
         The Class A-I-IO Certificates will only be entitled to interest for the
         first 30 Distribution Dates.

                                        3

<PAGE>

(5)      The Class SB Certificates will accrue interest as described in the
         definition of Accrued Certificate Interest. The Class SB Certificates
         will not accrue interest on their Certificate Principal Balance.
(6)      The Class A-I-IO Certificates do not have a principal balance. For the
         purpose of calculating interest payments, interest will accrue on a
         notional amount equal to the lesser of (a) $47,100,000 for the November
         2001 through January 2004 Distribution Dates, and $37,677,000 for the
         February 2004 through April 2004 Distribution Dates and (b) the
         aggregate principal balance of the Mortgage Loans in Loan Group I.

         The Group I Loans have an aggregate Cut-off Date Principal Balance
equal to approximately $376,769,492. The Group I Loans are fixed-rate, fully
amortizing and balloon payment, first lien and second lien mortgage loans having
terms to maturity at origination or modification of generally not more than 30
years. The Group II Loans have an aggregate Cut-off Date Principal Balance equal
to approximately $148,231,351. The Group II Loans are adjustable-rate, fully
amortizing, balloon payment and negatively amortizing, first lien mortgage loans
having terms to maturity at origination or modification of generally not more
than 30 years.

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

                                        4

<PAGE>

                                    ARTICLE I

                                   DEFINITIONS
                                   -----------

         Section 1.01.     DEFINITIONS.

         Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the meanings specified in this
Article.

         ACCRUED CERTIFICATE INTEREST: With respect to each Distribution Date
and the Class A Certificates, interest accrued during the preceding Interest
Accrual Period at the related Pass- Through Rate less interest shortfalls from
the Mortgage Loans, if any, allocated thereto for such Distribution Date, to the
extent not covered by Subordination, on the Certificate Principal Balance
thereof immediately prior to such Distribution Date (or in the case of the first
Distribution Date, the Cut-off Date). Accrued Certificate Interest on the Class
A Certificates will be reduced by:

         (i) the interest portion (adjusted to the Net Mortgage Rate (or the
         Modified Net Mortgage Rate in the case of a Modified Mortgage Loan)) of
         Excess Realized Losses on the Group I Loans and the Group II Loans,
         respectively, to the extent allocated to the related Class A
         Certificates,

         (ii) the interest portion of Advances previously made with respect to a
         Mortgage Loan or REO Property which remained unreimbursed following the
         Cash Liquidation or REO Disposition of such Mortgage Loan or REO
         Property that were made with respect to delinquencies that were
         ultimately determined to be Excess Realized Losses,

         (iii) with respect to the Class A-II Certificates, Deferred Interest to
         the extent allocated to Accrued Certificate Interest pursuant to
         Section 4.02(j) and

         (iv) any other interest shortfalls on the Group I Loans and the Group
         II Loans, respectively, other than Prepayment Interest Shortfalls,
         including interest that is not collectible from the Mortgagor for the
         related Due Period pursuant to the Relief Act or similar legislation or
         regulations as in effect from time to time, with all such reductions
         allocated on the Group I Loans to the Class A-I Certificates on a pro
         rata basis, and allocated on the Group II Loans to the Class A-II
         Certificates, in reduction of the Accrued Certificate Interest which
         would have resulted absent such reductions.

         With respect to each Distribution Date and the Class SB Certificates,
interest accrued during the preceding Interest Accrual Period at the related
Pass-Through Rate on the Notional Amount as specified in the definition of
Pass-Through Rate, immediately prior to such Distribution Date in each case,
reduced by any interest shortfalls with respect to the related Loan Group
including Prepayment Interest Shortfalls to the extent not covered by
Compensating Interest pursuant to Section 3.16 or by Group I or Group II Excess
Cash Flow pursuant to clauses (vi), (vii), (x), (xi) and (xii) of Section
4.02(c) and (d). In addition, Accrued Certificate Interest with respect to each
Distribution Date, as to the Class SB Certificates, shall be reduced by an
amount equal to the interest portion of Realized Losses allocated to the
Overcollateralization Amount pursuant to Section 4.05 hereof. Accrued

                                        5

<PAGE>

Certificate Interest on the Class A-I Certificates (other than the Class A-I-1
Certificates) and Class SB-I Certificates shall accrue on the basis of a 360-day
year consisting of twelve 30-day months. Accrued Certificate Interest on the
Class A-I-1 Certificates, Class A-II Certificates and Class SB-II Certificates
shall accrue on the basis of a 360-day year and the actual number of days in the
related Interest Accrual Period.

         ADJUSTED MORTGAGE RATE: With respect to any Mortgage Loan and any date
of determination, the Mortgage Rate borne by the related Mortgage Note, less the
rate at which the related Subservicing Fee accrues.

         ADJUSTMENT DATE: As to each adjustable rate Mortgage Loan, each date
set forth in the related Mortgage Note on which an adjustment to the interest
rate on such Mortgage Loan becomes effective.

         ADVANCE: As to any Mortgage Loan, any advance made by the Master
Servicer, pursuant to Section 4.04.

         AFFILIATE: With respect to any Person, any other Person controlling,
controlled by or under common control with such first Person. For the purposes
of this definition, "control" 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.

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

         AMOUNT HELD FOR FUTURE DISTRIBUTION: As to any Distribution Date, the
total of the amounts held in the Custodial Account at the close of business on
the preceding Determination Date on account of (i) Liquidation Proceeds,
Insurance Proceeds, Principal Prepayments, Mortgage Loan purchases made pursuant
to Section 2.02, 2.03, 2.04 or 4.07 and Mortgage Loan substitutions made
pursuant to Section 2.03 or 2.04 received or made in the month of such
Distribution Date (other than such Liquidation Proceeds, Insurance Proceeds and
purchases of Mortgage Loans that the Master Servicer has deemed to have been
received in the preceding month in accordance with Section 3.07(b)) and (ii)
payments which represent early receipt of scheduled payments of principal and
interest due on a date or dates subsequent to the Due Date in the related Due
Period.

         APPRAISED VALUE: As to any Mortgaged Property, one of the following:
(i) the lesser of (a) the appraised value of such Mortgaged Property based upon
the appraisal made at the time of the origination of the related Mortgage Loan,
and (b) the sales price of the Mortgaged Property at such time of origination,
(ii) in the case of a Mortgaged Property securing a refinanced or modified
Mortgage Loan, one of (1) the appraised value based upon the appraisal made at
the time of origination of the loan which was refinanced or modified, (2) the
appraised value determined in an appraisal made at the time of refinancing or
modification or (3) the sales price of the Mortgaged Property, or (iii) with
respect to the Mortgage Loans for which a broker's price opinion was obtained,
the value contained in such opinion.

                                        6

<PAGE>

         ARREARAGE: With respect to each Mortgage Loan subject to a bankruptcy
plan or repayment plan, the amount of previously delinquent payments and any
servicing advances or other items owed by the related Mortgagor which are not
included in the Cut-off Date Balance of such Mortgage Loan as indicated in the
Mortgage Loan Schedule.

         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 reflect of
record the sale of the Mortgage Loan to the Trustee for the benefit of
Certificateholders, which assignment, notice of transfer or equivalent
instrument may be in the form of one or more blanket assignments covering
Mortgages secured by Mortgaged Properties located in the same county, if
permitted by law and accompanied by an Opinion of Counsel to that effect.

         ASSIGNMENT AGREEMENT: The Assignment and Assumption Agreement, dated
the Closing Date, between Residential Funding and the Depositor relating to the
transfer and assignment of the Mortgage Loans.

         ASSIGNMENT OF PROPRIETARY LEASE: With respect to a Cooperative Loan,
the assignment of the related Cooperative Lease from the Mortgagor to the
originator of the Cooperative Loan.

         BALLOON LOAN: Each of the Mortgage Loans having an original term to
maturity that is shorter than the related amortization term.

         BALLOON PAYMENT: With respect to any Balloon Loan, the related Monthly
Payment payable on the stated maturity date of such Balloon Loan.

         BANKRUPTCY CODE: The Bankruptcy Code of 1978, as amended.

         BANKRUPTCY LOSS: With respect to any Mortgage Loan, a Deficient
Valuation or Debt Service Reduction; PROVIDED, HOWEVER, that neither a Deficient
Valuation nor a Debt Service Reduction shall be deemed a Bankruptcy Loss
hereunder so long as the Master Servicer has notified the Trustee and the
Insurer in writing that the Master Servicer is diligently pursuing any remedies
that may exist in connection with the representations and warranties made
regarding the related Mortgage Loan and either (A) the related Mortgage Loan is
not in default with regard to payments due thereunder or (B) delinquent payments
of principal and interest under the related Mortgage Loan and any premiums on
any applicable primary hazard insurance policy and any related escrow payments
in respect of such Mortgage Loan are being advanced on a current basis by the
Master Servicer or a Subservicer, in either case without giving effect to any
Debt Service Reduction.

         BASIS RISK SHORTFALL: With respect to the Class A-II Certificates and
any Distribution Date for which the Pass-Through Rate for such Certificates is
based on clause (iii) of the definition thereof, the excess, if any, of (x)
Accrued Certificate Interest on the Class A-II Certificates for such
Distribution Date, using the lesser of (a) LIBOR plus the Class A-II Margin, as
calculated for such Distribution Date, and (b) the Maximum Class A-II Rate, over
(y) Accrued Certificate Interest on the Class A-II Certificates for such
Distribution Date at the then-applicable Pass-Through Rate.

                                        7

<PAGE>

         BASIS RISK SHORTFALL CARRY-FORWARD AMOUNT: With respect to the Class
A-II Certificates and each Distribution Date, the sum of (a) the aggregate
amount of Basis Risk Shortfall for such Class on such Distribution Date which is
not covered on such Distribution Date by payments from the Reserve Fund plus (b)
any Basis Risk Shortfall Carry-Forward Amount for such Class remaining unpaid
from the preceding Distribution Date, plus (c) one month's interest on the
amount in clause (b) (based on the number of days in the preceding Interest
Accrual Period) at a rate equal to the lesser of (i) LIBOR plus the Class A-II
Margin for such Distribution Date and (ii) the Maximum Class A-II Rate.

         BOOK-ENTRY CERTIFICATE: Any Certificate registered in the name of the
Depository or its nominee.

         BUSINESS DAY: Any day other than (i) a Saturday or a Sunday or (ii) a
day on which banking institutions in the State of New York, the State of
Michigan, the State of California or the State of Illinois (and such other state
or states in which the Custodial Account or the Certificate Account are at the
time located) are required or authorized by law or executive order to be closed.

         CALENDAR QUARTER: A Calendar Quarter shall consist of one of the
following time periods in any given year: January 1 through March 31, April 1
through June 30, July 1 though September 30, and October 1 through December 31.

         CASH LIQUIDATION: As to any defaulted Mortgage Loan other than a
Mortgage Loan as to which an REO Acquisition occurred, a determination by the
Master Servicer that it has received all Insurance Proceeds, Liquidation
Proceeds and other payments or cash recoveries which the Master Servicer
reasonably and in good faith expects to be finally recoverable with respect to
such Mortgage Loan.

         CERTIFICATE: Any Class A Certificate, Class SB Certificate or Class R
Certificate.

         CERTIFICATE ACCOUNT: The account or accounts created and maintained
pursuant to Section 4.01, which shall be entitled "Bank One, National
Association, as trustee, in trust for the registered holders of Residential
Asset Mortgage Products, Inc., Mortgage Asset-Backed Pass-Through Certificates,
Series 2001-RS3" and which must be an Eligible Account. Any such account or
accounts created and maintained subsequent to the Closing Date shall be subject
to the approval of the Insurer, which approval shall not be unreasonably
withheld.

         CERTIFICATE ACCOUNT DEPOSIT DATE: As to any Distribution Date, the
Business Day prior thereto.

         CERTIFICATEHOLDER OR HOLDER: The Person in whose name a Certificate is
registered in the Certificate Register, except that neither a Disqualified
Organization nor a Non-United States Person shall be a holder of a Class R
Certificate for any purpose hereof. Solely for the purpose of giving any consent
or direction pursuant to this Agreement, any Certificate, other than a Class R
Certificate, registered in the name of the Depositor, the Master Servicer or any
Subservicer or any Affiliate thereof shall be deemed not to be outstanding and
the Percentage Interest or Voting Rights evidenced thereby shall not be taken
into account in determining whether the requisite amount of Percentage

                                        8

<PAGE>

Interests or Voting Rights necessary to effect any such consent or direction has
been obtained. All references herein to "Holders" or "Certificateholders" shall
reflect the rights of Certificate Owners as they may indirectly exercise such
rights through the Depository and participating members thereof, except as
otherwise specified herein; PROVIDED, HOWEVER, that the Trustee shall be
required to recognize as a "Holder" or "Certificateholder" only the Person in
whose name a Certificate is registered in the Certificate Register. Unless
otherwise indicated in this Agreement, the Custodial Agreement or the Assignment
Agreement, whenever reference is made to the actions taken by the Trustee on
behalf of the Certificateholders, such reference shall include the Insurer as
long as there is no Insurer Default continuing.

         CERTIFICATE INSURER PREMIUM: With respect to the Class A-I
Certificates, the premium payable to the Insurer on each Distribution Date in an
amount equal to one-twelfth of the product of the related Certificate Insurer
Premium Rate and the Certificate Principal Balance of the Class A-I Certificates
immediately prior to such Distribution Date. With respect to the Class A-II
Certificates, the premium payable to the Insurer on each Distribution Date in an
amount equal to one-twelfth of the product of the related Certificate Insurer
Premium Rate and the Certificate Principal Balance of the Class A-II
Certificates immediately prior to such Distribution Date.

         CERTIFICATE INSURER PREMIUM MODIFIED RATE: With respect to any Group I
Loan and any date of determination, the Certificate Insurer Premium Rate for the
Class A-I Certificates times a fraction equal to (x) the aggregate Certificate
Principal Balance of the Class A-I Certificates as of such date over (y) the
aggregate Stated Principal Balance of the Group I Loans as of such date. With
respect to any Group II Loan and any date of determination, the Certificate
Insurer Premium Rate for the Class A-II Certificates times a fraction equal to
(x) the aggregate Certificate Principal Balance of the Class A-II Certificates
as of such date over (y) the aggregate Stated Principal Balance of the Group II
Loans as of such date.

         CERTIFICATE INSURER PREMIUM RATE: With respect to each group of
Mortgage Loans and each Class of Class A Certificates and any date of
determination, the per annum rate specified in the Insurance Agreement with
respect to the Class A-I Certificates or Class A-II Certificates, as applicable,
for the purpose of calculating the related Certificate Insurer Premium.

         CERTIFICATE OWNER: With respect to a Book-Entry Certificate, the Person
who is the beneficial owner of such Certificate, as reflected on the books of an
indirect participating brokerage firm for which a Depository Participant acts as
agent, if any, and otherwise on the books of a Depository Participant, if any,
and otherwise on the books of the Depository.

         CERTIFICATE PRINCIPAL BALANCE: With respect to any Class A Certificate
(other than a Class A-I- IO Certificate), on any date of determination, an
amount equal to (i) the Initial Certificate Principal Balance of such
Certificate as specified on the face thereof, plus (ii) the Deferred Interest,
if any, allocated thereto for each Distribution Date prior to or coinciding with
such date of determination in accordance with Section 4.02(j), minus (iii) the
sum of (x) the aggregate of all amounts previously distributed with respect to
such Certificate (or any predecessor Certificate) (including such amounts paid
pursuant to the Policy) and applied to reduce the Certificate Principal Balance
or amount thereof pursuant to Sections 4.02(c) or 4.02(d) and (y) the aggregate
of all reductions in Certificate Principal Balance deemed to have occurred in
connection with Realized Losses which were previously

                                        9

<PAGE>

allocated to such Certificate (or any predecessor Certificate) pursuant to
Section 4.05 (other than any such amounts included in an Insured Amount and paid
pursuant to the Policy). With respect to each Class SB-I Certificate, on any
date of determination, an amount equal to the Percentage Interest evidenced by
such Certificate times an amount equal to (i) the excess, if any, of (A) the
then aggregate Stated Principal Balance of the Group I Loans over (B) the then
aggregate Certificate Principal Balance of the Class A-I Certificates then
outstanding, plus (ii) any Group I Diverted Excess Spread and minus (iii) any
Group II Diverted Excess Spread. With respect to each Class SB- II Certificate,
on any date of determination, an amount equal to the Percentage Interest
evidenced by such Certificate times an amount equal to (i) the excess, if any,
of (A) the then aggregate Stated Principal Balance of the Group II Loans over
(B) the then aggregate Certificate Principal Balance of the Class A-II
Certificates then outstanding, plus (ii) any Group II Diverted Excess Spread and
minus (iii) any Group I Diverted Excess Spread. The Class A-I-IO Certificates
and Class R Certificates will not have a Certificate Principal Balance.

         CERTIFICATE REGISTER AND CERTIFICATE REGISTRAR: The register maintained
and the registrar appointed pursuant to Section 5.02.

         CLASS: Collectively, all of the Certificates or uncertificated
interests bearing the same designation.

         CLASS A CERTIFICATES: Any one of the Class A-I or Class A-II
Certificates.

         CLASS A-I CERTIFICATES: Any one of the Class A-I-1, Class A-I-2, Class
A-I-3, Class A-I-4, Class A-I-5 or Class A-I-IO Certificates.

         CLASS A-I-1 CERTIFICATE: Any one of the Class A-I-1 Certificates
executed by the Trustee and authenticated by the Certificate Registrar
substantially in the form annexed hereto as Exhibit A, senior to the Class SB-I
Certificates and Class R-IV Certificates with respect to distributions and the
allocation of Realized Losses in respect of Loan Group I as set forth in Section
4.05, and evidencing an interest designated as a "regular interest" in REMIC IV
for purposes of the REMIC Provisions.

         CLASS A-I-2 CERTIFICATE: Any one of the Class A-I-2 Certificates
executed by the Trustee and authenticated by the Certificate Registrar
substantially in the form annexed hereto as Exhibit A, senior to the Class SB-I
Certificates and Class R-IV Certificates with respect to distributions and the
allocation of Realized Losses in respect of Loan Group I as set forth in Section
4.05, and evidencing an interest designated as a "regular interest" in REMIC IV
for purposes of the REMIC Provisions.

         CLASS A-I-3 CERTIFICATE: Any one of the Class A-I-3 Certificates
executed by the Trustee and authenticated by the Certificate Registrar
substantially in the form annexed hereto as Exhibit A, senior to the Class SB-I
Certificates and Class R-IV Certificates with respect to distributions and the
allocation of Realized Losses in respect of Loan Group I as set forth in Section
4.05, and evidencing an interest designated as a "regular interest" in REMIC IV
for purposes of the REMIC Provisions.

         CLASS A-I-4 CERTIFICATE: Any one of the Class A-I-4 Certificates
executed by the Trustee and authenticated by the Certificate Registrar
substantially in the form annexed hereto as Exhibit A, senior to the Class SB-I
Certificates and Class R-IV Certificates with respect to distributions and the

                                       10

<PAGE>

allocation of Realized Losses in respect of Loan Group I as set forth in Section
4.05, and evidencing an interest designated as a "regular interest" in REMIC IV
for purposes of the REMIC Provisions.

         CLASS A-I-5 CERTIFICATE: Any one of the Class A-I-5 Certificates
executed by the Trustee and authenticated by the Certificate Registrar
substantially in the form annexed hereto as Exhibit A, senior to the Class SB-I
Certificates and Class R-IV Certificates with respect to distributions and the
allocation of Realized Losses in respect of Loan Group I as set forth in Section
4.05, and evidencing an interest designated as a "regular interest" in REMIC IV
for purposes of the REMIC Provisions.

         CLASS A-I-5 LOCKOUT DISTRIBUTION AMOUNT: For any Distribution Date, the
product of (x) the Class A-I-5 Lockout Percentage for that Distribution Date and
(y) the Class A-I-5 Pro Rata Distribution Amount for that Distribution Date. In
no event shall the Class A-I-5 Lockout Distribution Amount for a Distribution
Date exceed the Principal Distribution Amount for Loan Group I for that
Distribution Date.

         CLASS A-I-5 LOCKOUT PERCENTAGE: For each Distribution Date, the
applicable percentage set forth below:

         (i)      for any Distribution Date from November 2001 through and
         including October 2004, 0%,

         (ii)     for any Distribution Date from November 2004 through and
         including October 2006, 45%,

         (iii)    for any Distribution Date from November 2006 through and
         including October 2007, 80%,

         (iv)     for any Distribution Date from November 2007 through and
         including October 2008, 100%, and

         (v)      for any Distribution Date from November 2008 and thereafter,
         300%.

         CLASS A-I-5 PRO RATA DISTRIBUTION AMOUNT: For any Distribution Date, an
amount equal to the product of (x) a fraction, the numerator of which is the
Certificate Principal Balance of the Class A-I-5 Certificates immediately prior
to that Distribution Date and the denominator of which is the aggregate
Certificate Principal Balance of the Class A-I Certificates immediately prior to
that Distribution Date and (y) the Principal Distribution Amount with respect to
Loan Group I for that Distribution Date.

         CLASS A-I-IO CERTIFICATE: Any one of the Class A-I-IO Certificates
executed by the Trustee and authenticated by the Certificate Registrar
substantially in the form annexed hereto as Exhibit A, senior to the Class SB-I
Certificates and Class R-IV Certificates with respect to distributions and the
allocation of Realized Losses in respect of Loan Group I as set forth in Section
4.05, and evidencing an interest designated as a "regular interest" in REMIC IV
for purposes of the REMIC Provisions.

                                       11

<PAGE>

         CLASS A-II CERTIFICATE: Any one of the Class A-II Certificates executed
by the Trustee and authenticated by the Certificate Registrar substantially in
the form annexed hereto as Exhibit A, senior to the Class SB-II Certificates and
Class R-IV Certificates with respect to distributions and the allocation of
Realized Losses in respect of Loan Group II as set forth in Section 4.05, and
(i) evidencing an interest designated as a "regular interest" in REMIC IV for
purposes of the REMIC Provisions and (ii) the right to receive the Basis Risk
Shortfall Carry-Forward Amount from the Reserve Fund.

         CLASS A-II MARGIN: 0.30% per annum, or starting on the first
Distribution Date after the first possible Group II Optional Termination Date,
0.60% per annum.

         CLASS R CERTIFICATE: Any one of the Class R-I, Class R-II, Class R-III
or Class R-IV Certificates.

         CLASS R-I CERTIFICATE: Any one of the Class R-I Certificates executed
by the Trustee and authenticated by the Certificate Registrar substantially in
the form annexed hereto as Exhibit D and evidencing an interest designated as a
"residual interest" in REMIC I for purposes of the REMIC Provisions.

         CLASS R-II CERTIFICATE: Any one of the Class R-II Certificates executed
by the Trustee and authenticated by the Certificate Registrar substantially in
the form annexed hereto as Exhibit D and evidencing an interest designated as a
"residual interest" in REMIC II for purposes of the REMIC Provisions.

         CLASS R-III CERTIFICATE: Any one of the Class R-III Certificates
executed by the Trustee and authenticated by the Certificate Registrar
substantially in the form annexed hereto as Exhibit D and evidencing an interest
designated as a "residual interest" in REMIC III for purposes of the REMIC
Provisions.

         CLASS R-IV CERTIFICATE: Any one of the Class R-IV Certificates executed
by the Trustee and authenticated by the Certificate Registrar substantially in
the form annexed hereto as Exhibit D and evidencing an interest designated as a
"residual interest" in REMIC IV for purposes of the REMIC Provisions.

         CLASS SB CERTIFICATES: Any one of the Class SB-I and Class SB-II
Certificates.

         CLASS SB-I CERTIFICATE: Any one of the Class SB-I Certificates executed
by the Trustee and authenticated by the Certificate Registrar substantially in
the form annexed hereto as Exhibit B, subordinate to the Class A-I Certificates
with respect to distributions and the allocation of Realized Losses in respect
of Loan Group I as set forth in Section 4.05, and evidencing an interest
designated as a "regular interest" in REMIC IV for purposes of the REMIC
Provisions.

         CLASS SB-II CERTIFICATE: Any one of the Class SB-II Certificates
executed by the Trustee and authenticated by the Certificate Registrar
substantially in the form annexed hereto as Exhibit B, subordinate to the Class
A-II Certificates with respect to distributions and the allocation of Realized

                                       12

<PAGE>

Losses in respect of Loan Group II as set forth in Section 4.05, and evidencing
an interest designated as a "regular interest" in REMIC IV for purposes of the
REMIC Provisions.

         CLOSING DATE: October 25, 2001.

         CODE: The Internal Revenue Code of 1986.

         COMPENSATING INTEREST: With respect to any Distribution Date, an amount
equal to Prepayment Interest Shortfalls resulting from Principal Prepayments in
Full or Curtailments during the related Prepayment Period, but not more than the
lesser of (a) one-twelfth of 0.125% of the Stated Principal Balance of the
Mortgage Loans immediately preceding such Distribution Date and (b) the sum of
the Servicing Fee, all income and gain on amounts held in the Custodial Account
and the Certificate Account and payable to the Certificateholders with respect
to such Distribution Date and servicing compensation to which the Master
Servicer may be entitled pursuant to Section 3.10(a)(v) and (vi), in each case
with respect to the related Loan Group; provided that for purposes of this
definition the amount of the Servicing Fee will not be reduced pursuant to
Section 7.02 except as may be required pursuant to the last sentence of such
Section.

         CONVERTED MORTGAGE LOAN: Any Group II Loan for which the related
Mortgage Rate has converted from an adjustable rate to a fixed rate.

         COOPERATIVE: A private, cooperative housing corporation which owns or
leases land and all or part of a building or buildings, including apartments,
spaces used for commercial purposes and common areas therein and whose board of
directors authorizes, among other things, the sale of Cooperative Stock.

         COOPERATIVE APARTMENT: A dwelling unit in a multi-dwelling building
owned or leased by a Cooperative, which unit the Mortgagor has an exclusive
right to occupy pursuant to the terms of a proprietary lease or occupancy
agreement.

         COOPERATIVE LEASE: With respect to a Cooperative Loan, the proprietary
lease or occupancy agreement with respect to the Cooperative Apartment occupied
by the Mortgagor and relating to the related Cooperative Stock, which lease or
agreement confers an exclusive right to the holder of such Cooperative Stock to
occupy such apartment.

         COOPERATIVE LOANS: Any of the Mortgage Loans made in respect of a
Cooperative Apartment, evidenced by a Mortgage Note and secured by (i) a
Security Agreement, (ii) the related Cooperative Stock Certificate, (iii) an
assignment of the Cooperative Lease, (iv) financing statements and (v) a stock
power (or other similar instrument), and ancillary thereto, a recognition
agreement between the Cooperative and the originator of the Cooperative Loan,
each of which was transferred and assigned to the Trustee pursuant to Section
2.01 and are from time to time held as part of the Trust Fund.

         COOPERATIVE STOCK: With respect to a Cooperative Loan, the single
outstanding class of stock, partnership interest or other ownership instrument
in the related Cooperative.

                                       13

<PAGE>

         COOPERATIVE STOCK CERTIFICATE: With respect to a Cooperative Loan, the
stock certificate or other instrument evidencing the related Cooperative Stock.

         CORPORATE TRUST OFFICE: The principal office of the Trustee at which at
any particular time its corporate trust business with respect to this Agreement
shall be administered, which office at the date of the execution of this
instrument is located at 1 Bank One Plaza, Suite IL1-0126, Chicago, Illinois
60670-0126, Attention: RAMPI, Series 2001-RS3.

         CURTAILMENT: Any Principal Prepayment made by a Mortgagor which is not
a Principal Prepayment in Full.

         CUSTODIAL ACCOUNT: The custodial account or accounts created and
maintained pursuant to Section 3.07 in the name of a depository institution, as
custodian for the holders of the Certificates and for the Insurer, for the
holders of certain other interests in mortgage loans serviced or sold by the
Master Servicer and for the Master Servicer, into which the amounts set forth in
Section 3.07 shall be deposited directly. Any such account or accounts shall be
an Eligible Account.

         CUSTODIAL AGREEMENT: An agreement that may be entered into among the
Depositor, the Master Servicer, the Trustee and a Custodian in substantially the
form of Exhibit E hereto.

         CUSTODIAN: A custodian appointed pursuant to a Custodial Agreement and
reasonably acceptable to the Insurer.

         CUT-OFF DATE: October 1, 2001.

         CUT-OFF DATE BALANCE: The Group I Cut-off Date or the Group II Cut-off
Date Balance.

         CUT-OFF DATE PRINCIPAL BALANCE: As to any Mortgage Loan, the unpaid
principal balance thereof at the Cut-off Date after giving effect to all
installments of principal due on or prior thereto (or due during the month of
October 2001), whether or not received, exclusive of any Arrearages.

         DEBT SERVICE REDUCTION: With respect to any Mortgage Loan, a reduction
in the scheduled Monthly Payment for such Mortgage Loan by a court of competent
jurisdiction in a proceeding under the Bankruptcy Code, except such a reduction
constituting a Deficient Valuation or any reduction that results in a permanent
forgiveness of principal.

         DEFERRED INTEREST: With respect to any Neg Am Loan, as of any Due Date,
the amount, if any, by which the Mortgage Loan Accrued Interest for such Due
Date exceeds the Monthly Payment for such Due Date and which amount, pursuant to
the terms of the Mortgage Note, is added to the principal balance of the
Mortgage Loan.

         DEFICIENCY AMOUNT: With respect to the Class A Certificates as of any
Distribution Date, (i) any shortfall in amounts available in the Certificate
Account to pay Accrued Certificate Interest for the related Interest Accrual
Period on the Certificate Principal Balance of the Class A Certificates, or the
Notional Amount in the case of the Class A-I-IO Certificates, at the
then-applicable Pass- Through Rate, net of any interest shortfalls relating to
Deferred Interest, the Relief Act or

                                       14

<PAGE>

Prepayment Interest Shortfalls allocated to the Class A Certificates, (ii) the
principal portion of any Realized Losses allocated to such Class A Certificates
with respect to such Distribution Date and (iii) the Certificate Principal
Balance of the Class A Certificates, other than the Class A-I-IO Certificates,
to the extent unpaid on the earlier of the Distribution Date occurring in
October 2031 and the Final Distribution Date or earlier termination of the Trust
Fund pursuant to Section 9.01(a) hereof. The Deficiency Amount does not include
any Basis Risk Shortfalls.

         DEFICIENT VALUATION: With respect to any Mortgage Loan, a valuation by
a court of competent jurisdiction of the Mortgaged Property in an amount less
than the then outstanding indebtedness under the Mortgage Loan, or any reduction
in the amount of principal to be paid in connection with any scheduled Monthly
Payment that constitutes a permanent forgiveness of principal, which valuation
or reduction results from a proceeding under the Bankruptcy Code.

         DEFINITIVE CERTIFICATE: Any definitive, fully registered Certificate.

         DELETED MORTGAGE LOAN: A Mortgage Loan replaced or to be replaced with
a Qualified Substitute Mortgage Loan.

         DELINQUENCY RATIO: With respect to the Mortgage Loans and any
Distribution Date, the percentage equivalent of a fraction (a) the numerator of
which equals the sum of (i) 100% of the aggregate Stated Principal Balance of
all Mortgage Loans that are 90 or more days Delinquent, ( (ii) 75% of the
aggregate Stated Principal Balance of all Mortgage Loans that are in foreclosure
and (iii) 100% of the aggregate Stated Principal Balance of all Mortgage Loans
that are converted to REO Properties, in each case as of the last day of the
related Due Period and (b) the denominator of which is the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of such Due Period.

         DELINQUENT: As used herein, a Mortgage Loan is considered to be: "30 to
59 days" or "30 or more days" delinquent when a payment due on any scheduled due
date remains unpaid as of the close of business on the next following monthly
scheduled due date; "60 to 89 days" or "60 or more days" delinquent when a
payment due on any scheduled due date remains unpaid as of the close of business
on the second following monthly scheduled due date; and so on. The determination
as to whether a Mortgage Loan falls into these categories is made as of the
close of business on the last business day of each month. For example, a
Mortgage Loan with a payment due on July 1 that remained unpaid as of the close
of business on August 31 would then be considered to be 30 to 59 days
delinquent. Delinquency information as of the Cut-off Date is determined and
prepared as of the close of business on the last business day immediately prior
to the Cut-off Date. As used hereunder, a Mortgage Loan that is a Re-Performing
Loan is not Delinquent so long as that Mortgage Loan is making timely payments
under the related repayment plan or bankruptcy plan, and the length of
delinquency of any such Mortgage Loan at any time for purposes of this Agreement
shall be as of the time such Mortgage Loan became delinquent with respect to the
related plan or agreement, and only with respect to the related Monthly Payment.

         DEPOSITORY: The Depository Trust Company, or any successor Depository
hereafter named. The nominee of the initial Depository for purposes of
registering those Certificates that are to be Book-Entry Certificates is Cede &
Co. The Depository shall at all times be a "clearing corporation"

                                       15

<PAGE>

as defined in Section 8-102(3) of the Uniform Commercial Code of the State of
New York and a "clearing agency" registered pursuant to the provisions of
Section 17A of the Securities Exchange Act of 1934, as amended.

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

         DESTROYED MORTGAGE NOTE: A Mortgage Note the original of which was
permanently lost or destroyed and has not been replaced.

         DETERMINATION DATE: With respect to any Distribution Date, the 20th day
(or if such 20th day is not a Business Day, the Business Day immediately
following such 20th day) of the month of the related Distribution Date.

         DISQUALIFIED ORGANIZATION: Any organization defined as a "disqualified
organization" under Section 860E(e)(5) of the Code, which includes any of the
following: (i) the United States, any State or political subdivision thereof,
any possession of the United States, or any agency or instrumentality of any of
the foregoing (other than an instrumentality which is a corporation if all of
its activities are subject to tax and, except for Freddie Mac, a majority of its
board of directors is not selected by such governmental unit), (ii) a foreign
government, any international organization, or any agency or instrumentality of
any of the foregoing, (iii) any organization (other than certain farmers'
cooperatives described in Section 521 of the Code) which is exempt from the tax
imposed by Chapter 1 of the Code (including the tax imposed by Section 511 of
the Code on unrelated business taxable income) and (iv) rural electric and
telephone cooperatives described in Section 1381(a)(2)(C) of the Code. A
Disqualified Organization also includes any "electing large partnership," as
defined in Section 775(a) of the Code and any other Person so designated by the
Trustee based upon an Opinion of Counsel that the holding of an Ownership
Interest in a Class R Certificate by such Person may cause either REMIC or any
Person having an Ownership Interest in any Class of Certificates (other than
such Person) to incur a liability for any federal tax imposed under the Code
that would not otherwise be imposed but for the Transfer of an Ownership
Interest in a Class R Certificate to such Person. The terms "United States",
"State" and "international organization" shall have the meanings set forth in
Section 7701 of the Code or successor provisions.

         DISTRIBUTION DATE: The 25th day of any month beginning in the month
immediately following the month of the initial issuance of the Certificates or,
if such 25th day is not a Business Day, the Business Day immediately following
such 25th day.

         DUE DATE: With respect to any Distribution Date and any Mortgage Loan,
the day during the related Due Period on which the Monthly Payment is due.

         DUE PERIOD: With respect to any Distribution Date, the calendar month
of such Distribution Date.

         ELIGIBLE ACCOUNT: An account that is any of the following: (i)
maintained with a depository institution the debt obligations of which have been
rated by each Rating Agency in its highest rating

                                       16

<PAGE>

available, or (ii) an account or accounts in a depository institution in which
such accounts are fully insured to the limits established by the FDIC, provided
that any deposits not so insured shall, to the extent acceptable to each Rating
Agency, as evidenced in writing, be maintained such that (as evidenced by an
Opinion of Counsel delivered to the Trustee and each Rating Agency) the
registered Holders of Certificates have a claim with respect to the funds in
such account or a perfected first 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 with which such account is maintained, or (iii) in the case of the
Custodial Account, either (A) a trust account or accounts maintained in the
corporate trust department of Bank One, National Association, or (B) an account
or accounts maintained in the corporate asset services department of Bank One,
National Association as long as its short term debt obligations are rated P-1
(or the equivalent) or better by each Rating Agency, and its long term debt
obligations are rated A2 (or the equivalent) or better, by each Rating Agency,
or (iv) in the case of the Certificate Account, a trust account or accounts
maintained in the corporate trust division of Bank One, National Association, or
(v) an account or accounts of a depository institution acceptable to each Rating
Agency (as evidenced in writing by each Rating Agency that use of any such
account as the Custodial Account or the Certificate Account will not reduce the
rating assigned to any Class of Certificates by such Rating Agency below the
lower of the then-current rating or the rating assigned to such Certificates as
of the Closing Date by such Rating Agency).

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

         EVENT OF DEFAULT: As defined in Section 7.01.

         EXCESS OVERCOLLATERALIZATION AMOUNT: With respect to any Distribution
Date, the excess, if any, of (a) the Overcollateralization Amount on such
Distribution Date over (b) the Required Overcollateralization Amount.

         EXCESS REALIZED LOSS: Any Realized Loss on a Mortgage Loan, other than
a Group I or Group II Excess Fraud Loss, Group I or Group II Excess Special
Hazard Loss, Group I or Group II Excess Bankruptcy Loss or Group I or Group II
Extraordinary Loss, to the extent that the amount of such Realized Loss, plus
the aggregate amount of such Realized Losses on all of the Mortgage Loans since
the Cut-off Date, is in excess of 10.00% of the sum of the Group I Cut-off Date
Balance and the Group II Cut-off Date Balance.

         EXTRAORDINARY EVENTS: Any of the following conditions with respect to a
Mortgaged Property (or, with respect to a Cooperative Loan, the Cooperative
Apartment) or Mortgage Loan causing or resulting in a loss which causes the
liquidation of such Mortgage Loan:

                  (a) losses that are of the type that would be covered by the
         fidelity bond and the errors and omissions insurance policy required to
         be maintained pursuant to Section 3.12(b) but are in excess of the
         coverage maintained thereunder;

                  (b) nuclear reaction or nuclear radiation or radioactive
         contamination, all whether controlled or uncontrolled, and whether such
         loss be direct or indirect, proximate or remote

                                       17

<PAGE>

         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";

                  (c) hostile or warlike action in time of peace or war,
         including action in hindering, combatting or defending against an
         actual, impending or expected attack;

                           1.       by any government or sovereign power, de
                  jure or defacto, 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; or

                           4.       any weapon of war employing atomic fission
                  or radioactive force whether in time of peace or war; or

                           5. insurrection, rebellion, revolution, civil war,
                  usurped power or action taken by governmental authority in
                  hindering, combatting 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.

         FANNIE MAE: Fannie Mae, a federally chartered and privately owned
corporation organized and existing under the Federal National Mortgage
Association Charter Act, or any successor thereto.

         FASIT: A "financial asset securitization investment trust" within the
meaning of Section 860L of the Code.

         FDIC: Federal Deposit Insurance Corporation or any successor thereto.

         FHA: The Federal Housing Administration, or its successor.

         FINAL DISTRIBUTION DATE: The Distribution Date on which the final
distribution in respect of the Certificates will be made pursuant to Section
9.01, which Final Distribution Date shall in no event be later than the end of
the 90-day liquidation period described in Section 9.02.

         FINAL SCHEDULED DISTRIBUTION DATE: Solely for purposes of the face of
the Certificates, as follows: with respect to the Class A-I-1 Certificates, July
25, 2019; with respect to the Class A-I-2 Certificates, May 25, 2025; with
respect to the Class A-I-3 Certificates, January 25, 2028; with respect to the
Class A-I-IO Certificates, April 25, 2004; and with respect to the Class A-I-4,
Class A-I-5 and Class A-II Certificates, October 25, 2031. No event of default
under this Agreement will arise or become applicable solely by reason of the
failure to retire the entire Certificate Principal Balance of any Class of Class
A Certificates on or before its Final Scheduled Distribution Date.

         FITCH: Fitch, Inc.

                                       18

<PAGE>

         FORECLOSURE PROFITS: As to any Distribution Date or related
Determination Date and any Mortgage Loan, the excess, if any, of Liquidation
Proceeds, Insurance Proceeds and REO Proceeds (net of all amounts reimbursable
therefrom pursuant to Section 3.10(a)(ii)) in respect of each Mortgage Loan or
REO Property for which a Cash Liquidation or REO Disposition occurred in the
related Prepayment Period over the sum of the unpaid principal balance of such
Mortgage Loan or REO Property (determined, in the case of an REO Disposition, in
accordance with Section 3.14) plus accrued and unpaid interest at the Mortgage
Rate on such unpaid principal balance from the Due Date to which interest was
last paid by the Mortgagor to the first day of the month following the month in
which such Cash Liquidation or REO Disposition occurred.

         FORECLOSURE RESTRICTED LOAN: A Mortgage Loan which was between 60 and
89 days delinquent as of the Cut-off Date or is a Servicer Bailee Loan, as
indicated on Exhibit S; provided, that such Mortgage Loan will no longer be a
Foreclosure Restricted Loan: (i) if such Mortgage Loan was between 60 and 89
days delinquent as of the Cut-off Date, it becomes current for three consecutive
Monthly Payments after the Cut-off Date, or (ii) if such Mortgage is a Servicer
Bailee Loan, it becomes current for three consecutive Monthly Payments after the
Cut-off Date or the original Mortgage File is returned to the Trustee.

         FRAUD LOSSES: Losses on Mortgage Loans as to which there was fraud in
the origination of such Mortgage Loan.

         FREDDIE MAC: 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.

         GROSS MARGIN: As to each adjustable rate Mortgage Loan, the fixed
percentage set forth in the related Mortgage Note and indicated in Exhibit F-2
hereto as the "NOTE MARGIN," which percentage is added to the related Index on
each Adjustment Date to determine (subject to rounding in accordance with the
related Mortgage Note, the Periodic Cap, the Maximum Mortgage Rate and the
Minimum Mortgage Rate) the interest rate to be borne by such Mortgage Loan until
the next Adjustment Date.

         GROUP I ADJUSTED NET WAC RATE: For the November 2001 Distribution Date
through the April 2004 Distribution Date, a per annum rate equal to (1) the
weighted average of the Net Mortgage Rates of the Group I Loans as of the first
day of the month preceding the month in which such Distribution Date occurs
minus (2) the Pass-Through Rate for the Class A-I-IO Certificates for such
Distribution Date multiplied by a fraction, the numerator of which is (x) the
Notional Amount of the Class A-I-IO Certificates immediately prior to such
Distribution Date, and the denominator of which is (y) the aggregate Stated
Principal Balance of the Group I Loans as of the first day of the month
preceding the month in which such Distribution Date occurs. For any subsequent
Distribution Date, the weighted average of the Net Mortgage Rates of the Group I
Loans. For federal income tax purposes, however, the equivalent of the
foregoing, expressed as a per annum rate (but not less than zero) equal to the
weighted average of (x) the Uncertificated REMIC I Pass-Through Rate with
respect to REMIC I Regular Interest LT-A-1 for such Distribution Date and (y)
the excess, if any, of (i) the Uncertificated REMIC I Pass-Through Rate with
respect to REMIC I Regular Interest LT- A-3 for such Distribution Date over (ii)
(A) in the case of the Distribution Date in November 2001

                                       19

<PAGE>

through the Distribution Date in April 2004, 6.00% per annum and (B) in the case
of any Distribution Date thereafter, 0.00% per annum; weighted, (i) for the
Distribution Date in November 2001 through the Distribution Date in January
2004, in the case of clause (x), on the basis of the Uncertificated Principal
Balance of REMIC I Regular Interest LT-A-1, and in the case of clause (y), on
the basis of the aggregate Uncertificated Principal Balances of REMIC I Regular
Interests LT-A-2 and LT-A-3, respectively, and (ii) for the Distribution Date in
February 2004 through the Distribution Date in April 2004, in the case of clause
(x), on the basis of the aggregate Uncertificated Principal Balances of REMIC I
Regular Interests LT-A-1 and LT-A-2, and in the case of clause (y), on the basis
of the Uncertificated Principal Balance of REMIC I Regular Interests LT-A-3,
respectively.

         GROUP I AVAILABLE DISTRIBUTION AMOUNT: As to any Distribution Date, an
amount equal to (a) the sum of (i) the amount relating to the Group I Loans on
deposit in the Custodial Account as of the close of business on the immediately
preceding Determination Date and amounts deposited in the Custodial Account in
connection with the substitution of Qualified Substitute Mortgage Loans that are
Group I Loans, (ii) the amount of any Advance made on the immediately preceding
Certificate Account Deposit Date with respect to the Group I Loans, (iii) any
amount deposited in the Certificate Account on the related Certificate Account
Deposit Date pursuant to the second paragraph of Section 3.12(a) in respect of
the Group I Loans, (iv) any amount that the Master Servicer is not permitted to
withdraw from the Custodial Account pursuant to Section 3.16(e) in respect of
the Group I Loans and (v) any amount deposited in the Certificate Account
pursuant to Section 4.07 or 9.01 in respect of the Group I Loans, reduced by (b)
the sum as of the close of business on the immediately preceding Determination
Date of (x) the Amount Held for Future Distribution with respect to the Group I
Loans, (y) amounts permitted to be withdrawn by the Master Servicer from the
Custodial Account in respect of the Group I Loans pursuant to clauses (ii)-(x),
inclusive, of Section 3.10(a) and (z) the Certificate Insurer Premium payable
with respect to the Class A-I Certificates on such Distribution Date.

         GROUP II AVAILABLE DISTRIBUTION AMOUNT: As to any Distribution Date, an
amount equal to (a) the sum of (i) the amount relating to the Group II Loans on
deposit in the Custodial Account as of the close of business on the immediately
preceding Determination Date and amounts deposited in the Custodial Account in
connection with the substitution of Qualified Substitute Mortgage Loans that are
Group II Loans, (ii) the amount of any Advance made on the immediately preceding
Certificate Account Deposit Date with respect to the Group II Loans, (iii) any
amount deposited in the Certificate Account on the related Certificate Account
Deposit Date pursuant to the second paragraph of Section 3.12(a) in respect of
the Group II Loans, (iv) any amount that the Master Servicer is not permitted to
withdraw from the Custodial Account pursuant to Section 3.16(e) in respect of
the Group II Loans and (v) any amount deposited in the Certificate Account
pursuant to Section 4.07 or 9.01 in respect of the Group II Loans, reduced by
(b) the sum as of the close of business on the immediately preceding
Determination Date of: (x) the Amount Held for Future Distribution with respect
to the Group II Loans, (y) amounts permitted to be withdrawn by the Master
Servicer from the Custodial Account in respect of the Group II Loans pursuant to
clauses (ii)- (x), inclusive, of Section 3.10(a) and (z) the Certificate Insurer
Premium payable with respect to the Class A-II Certificates on such Distribution
Date.

                                       20

<PAGE>

         GROUP I BANKRUPTCY AMOUNT: As of any date of determination, an amount
equal to $164,950, less the sum of any amounts allocated through Section 4.05
for Bankruptcy Losses on the Group I Loans up to such date of determination. The
Group I Bankruptcy Amount may be further reduced by the Master Servicer
(including accelerating the manner in which such coverage is reduced) provided
that prior to any such reduction, the Master Servicer shall (i) obtain written
approval from the Insurer and written confirmation from each Rating Agency that
such reduction shall not reduce the rating assigned to the Class A-I
Certificates by such Rating Agency below the lower of the then- current rating
or the rating assigned to such Certificates as of the Closing Date by such
Rating Agency without taking into account the Policy, and (ii) provide a copy of
such written confirmation to the Trustee and the Insurer.

         GROUP II BANKRUPTCY AMOUNT: As of any date of determination, an amount
equal to $100,000, less the sum of any amounts allocated through Section 4.05
for Bankruptcy Losses on the Group II Loans up to such date of determination.
The Group II Bankruptcy Amount may be further reduced by the Master Servicer
(including accelerating the manner in which such coverage is reduced) provided
that prior to any such reduction, the Master Servicer shall (i) obtain written
approval from the Insurer and written confirmation from each Rating Agency that
such reduction shall not reduce the rating assigned to the Class A-II
Certificates by such Rating Agency below the lower of the then- current rating
or the rating assigned to such Certificates as of the Closing Date by such
Rating Agency without taking into account the Policy, and (ii) provide a copy of
such written confirmation to the Trustee and the Insurer.

         GROUP I CUMULATIVE INSURANCE PAYMENTS: As of any time of determination,
the aggregate amount of all Insured Amounts previously paid by the Insurer under
the Policy in respect of the Class A-I Certificates (other than those
attributable to Group I Excess Losses) minus (a) the aggregate of all payments
previously made to the Insurer pursuant to Section 4.02(c)(v) or 4.02(d)(vi)
hereof as reimbursement for such Insured Amounts, plus (b) interest thereon from
the date such amounts became due until paid in full, at a rate of interest equal
to the Late Payment Rate.

         GROUP II CUMULATIVE INSURANCE PAYMENTS: As of any time of
determination, the aggregate amount of all Insured Amounts previously paid by
the Insurer under the Policy in respect of the Class A-II Certificates (other
than those attributable to Group II Excess Losses) minus (a) the aggregate of
all payments previously made to the Insurer pursuant to Section 4.02(c)(vi) or
4.02(d)(v) hereof as reimbursement for such Insured Amounts, plus (b) interest
thereon from the date such amounts became due until paid in full, at a rate of
interest equal to the Late Payment Rate.

         GROUP I CUT-OFF DATE BALANCE: $376,769,492.

         GROUP II CUT-OFF DATE BALANCE: $148,231,351.

         GROUP I DIVERTED EXCESS SPREAD: Any amount otherwise payable as Accrued
Certificated Interest on the Class SB-I Certificate that, pursuant to Section
4.02(c), is used to increase the Group II Overcollateralization Amount or is
used to offset Realized Losses on any Group II Loans. Any reduction in the Group
II Overcollateralization Amount shall first reduce the Group I Diverted Excess
Spread until it is reduced to zero, and in the event that such reduction is due
to an Overcollateralization Reduction Amount the amount of such reduction shall
be payable to the Class

                                       21

<PAGE>

SB-I Certificates to the extent of the Group I Diverted Excess Spread. No
interest will accrue on the Group I Diverted Excess Spread.

         GROUP II DIVERTED EXCESS SPREAD: Any amount otherwise payable as
Accrued Certificated Interest on the Class SB-II Certificate that, pursuant to
Section 4.02(d), is used to increase the Group I Overcollateralization Amount or
is used to offset Realized Losses on any Group I Loans. Any reduction in the
Group I Overcollateralization Amount shall first reduce the Group II Diverted
Excess Spread until it is reduced to zero, and in the event that such reduction
is due to an Overcollateralization Reduction Amount the amount of such reduction
shall be payable to the Class SB-II Certificates to the extent of the Group I
Diverted Excess Spread. No interest will accrue on the Group II Diverted Excess
Spread.

         GROUP I EXCESS BANKRUPTCY LOSS: With respect to the Group I Loans, any
Bankruptcy Loss on the Group I Loans, or portion thereof, which exceeds the
then-applicable Group I Bankruptcy Amount.

         GROUP II EXCESS BANKRUPTCY LOSS: With respect to the Group II Loans,
any Bankruptcy Loss on the Group II Loans, or portion thereof, which exceeds the
then-applicable Group II Bankruptcy Amount.

         GROUP I EXCESS CASH FLOW: As defined in Section 4.02(c)(iii).

         GROUP II EXCESS CASH FLOW: As defined in Section 4.02(d)(iii).

         GROUP I EXCESS FRAUD LOSS: With respect to the Group I Loans, any Fraud
Loss on the Group I Loans, or portion thereof, which exceeds the then-applicable
Group I Fraud Loss Amount.

         GROUP II EXCESS FRAUD LOSS: With respect to the Group II Loans, any
Fraud Loss on the Group II Loans, or portion thereof, which exceeds the
then-applicable Group II Fraud Loss Amount.

         GROUP I EXCESS LOSS: Any (i) Group I Excess Fraud Loss, Group I Excess
Special Hazard Loss, Group I Excess Bankruptcy Loss or Group I Extraordinary
Loss or (ii) any Excess Realized Loss on a Group I Loan.

         GROUP II EXCESS LOSS: Any (i) Group II Excess Fraud Loss, Group II
Excess Special Hazard Loss, Group II Excess Bankruptcy Loss or Group II
Extraordinary Loss or (ii) any Excess Realized Loss on a Group II Loan.

         GROUP I EXCESS OVERCOLLATERALIZATION AMOUNT: With respect to any
Distribution Date, the excess, if any, of (a) the Group I Overcollateralization
Amount on such Distribution Date over (b) the Group I Required
Overcollateralization Amount.

         GROUP II EXCESS OVERCOLLATERALIZATION AMOUNT: With respect to any
Distribution Date, the excess, if any, of (a) the Group II Overcollateralization
Amount on such Distribution Date over (b) the Group II Required
Overcollateralization Amount.

                                       22

<PAGE>

         GROUP I EXCESS SPECIAL HAZARD LOSS: With respect to the Group I Loans,
any Special Hazard Loss on the Group I Loans, or portion thereof, that exceeds
the then-applicable Group I Special Hazard Amount.

         GROUP II EXCESS SPECIAL HAZARD LOSS: With respect to the Group II
Loans, any Special Hazard Loss on the Group II Loans, or portion thereof, that
exceeds the then-applicable Group II Special Hazard Amount.

         GROUP I EXTRAORDINARY LOSSES: Any loss incurred on a Group I Loan
caused by or resulting from an Extraordinary Event.

         GROUP II EXTRAORDINARY LOSSES: Any loss incurred on a Group II Loan
caused by or resulting from an Extraordinary Event.

         GROUP I FRAUD LOSS AMOUNT: As of any date of determination after the
Cut-off Date, an amount equal to (X) prior to the first anniversary of the
Cut-off Date an amount equal to 3.00% of the aggregate outstanding principal
balance of all of the Group I Loans as of the Cut-off Date minus the aggregate
amount of Fraud Losses on the Group I Loans allocated through Subordination, in
accordance with Section 4.05 since the Cut-off Date up to such date of
determination, (Y) from the first to the second anniversary of the Cut-off Date,
an amount equal to (1) the lesser of (a) the Group I Fraud Loss Amount as of the
most recent anniversary of the Cut-off Date and (b) 2.00% of the aggregate
outstanding principal balance of all of the Group I Loans as of the most recent
anniversary of the Cut-off Date minus (2) the Fraud Losses on the Group I Loans
allocated through Subordination, in accordance with Section 4.05 since the most
recent anniversary of the Cut-off Date up to such date of determination, and (Z)
from the second to the fifth anniversary of the Cut-off Date, an amount equal to
(1) the lesser of (a) the Group I Fraud Loss Amount as of the most recent
anniversary of the Cut-off Date and (b) 1.00% of the aggregate outstanding
principal balance of all of the Group I Loans as of the most recent anniversary
of the Cut-off Date minus (2) the Fraud Losses on the Group I Loans allocated
through Subordination, in accordance with Section 4.05 since the most recent
anniversary of the Cut-off Date up to such date of determination. On and after
the fifth anniversary of the Cut-off Date the Group I Fraud Loss Amount shall be
zero.

         The Group I Fraud Loss Amount may be further reduced by the Master
Servicer (including accelerating the manner in which such coverage is reduced)
provided that prior to any such reduction, the Master Servicer shall (i) obtain
written approval from the Insurer and obtain written confirmation from each
Rating Agency that such reduction shall not reduce the rating assigned to the
Class A-I Certificates by such Rating Agency below the lower of the then-current
rating or the rating assigned to such Certificates as of the Closing Date by
such Rating Agency, without taking into account the Policy; and (ii) provide a
copy of such written confirmation to the Trustee and the Insurer.

         GROUP II FRAUD LOSS AMOUNT: As of any date of determination after the
Cut-off Date, an amount equal to (X) prior to the first anniversary of the
Cut-off Date an amount equal to 3.00% of the aggregate outstanding principal
balance of all of the Group II Loans as of the Cut-off Date minus the aggregate
amount of Fraud Losses on the Group II Loans allocated through Subordination, in
accordance with Section 4.05 since the Cut-off Date up to such date of
determination, (Y) from the

                                       23

<PAGE>

first to the second anniversary of the Cut-off Date, an amount equal to (1) the
lesser of (a) the Group II Fraud Loss Amount as of the most recent anniversary
of the Cut-off Date and (b) 2.00% of the aggregate outstanding principal balance
of all of the Group II Loans as of the most recent anniversary of the Cut-off
Date minus (2) the Fraud Losses on the Group II Loans allocated through
Subordination, in accordance with Section 4.05 since the most recent anniversary
of the Cut-off Date up to such date of determination, and (Z) from the second to
the fifth anniversary of the Cut-off Date, an amount equal to (1) the lesser of
(a) the Group II Fraud Loss Amount as of the most recent anniversary of the
Cut-off Date and (b) 1.00% of the aggregate outstanding principal balance of all
of the Group II Loans as of the most recent anniversary of the Cut-off Date
minus (2) the Fraud Losses on the Group II Loans allocated through
Subordination, in accordance with Section 4.05 since the most recent anniversary
of the Cut-off Date up to such date of determination. On and after the fifth
anniversary of the Cut-off Date the Group II Fraud Loss Amount shall be zero.
The Group II Fraud Loss Amount may be further reduced by the Master Servicer
(including accelerating the manner in which such coverage is reduced) provided
that prior to any such reduction, the Master Servicer shall (i) obtain written
approval from the Insurer and obtain written confirmation from each Rating
Agency that such reduction shall not reduce the rating assigned to the Class
A-II Certificates by such Rating Agency below the lower of the then-current
rating or the rating assigned to such Certificates as of the Closing Date by
such Rating Agency, without taking into account the Policy; and (ii) provide a
copy of such written confirmation to the Trustee and the Insurer.

         GROUP I INTEREST DISTRIBUTION AMOUNT: As defined in Section 4.02(c)(i).
Group II Interest Distribution Amount: As defined in Section 4.02(d)(i).

         GROUP I LOAN: The Mortgage Loans designated on the Mortgage Loan
Schedule attached hereto as Exhibit F-1.

         GROUP II LOAN: The Mortgage Loans designated on the Mortgage Loan
Schedule attached hereto as Exhibit F-2.

         GROUP I OPTIONAL TERMINATION DATE: Any Distribution Date on or after
which the Stated Principal Balance (before giving effect to distributions to be
made on such Distribution Date) of the Group I Loans is less than 10.00% of the
Group I Cut-off Date Balance.

         GROUP II OPTIONAL TERMINATION DATE: Any Distribution Date on or after
which the Stated Principal Balance (before giving effect to distributions to be
made on such Distribution Date) of the Group II Loans is less than 10.00% of the
Group II Cut-off Date Balance.

         GROUP I OVERCOLLATERALIZATION AMOUNT: With respect to any Distribution
Date, the excess, if any, of (a) the aggregate Stated Principal Balances of the
Group I Loans before giving effect to distributions of principal to be made on
such Distribution Date over (b) the aggregate Certificate Principal Balance of
the Class A-I Certificates immediately prior to such date.

         GROUP II OVERCOLLATERALIZATION AMOUNT: With respect to any Distribution
Date, the excess, if any, of (a) the aggregate Stated Principal Balances of the
Group II Loans before giving effect to distributions of principal to be made on
such Distribution Date over (b) the aggregate Certificate Principal Balance of
the Class A-II Certificates immediately prior to such date.

                                       24

<PAGE>

         GROUP I OVERCOLLATERALIZATION INCREASE AMOUNT: With respect to any
Distribution Date, the lesser of (a) the Group I Excess Cash Flow for such
Distribution Date available to make payments pursuant to Section 4.02(c)(viii)
plus the Group II Excess Cash Flow for such Distribution Date available to make
payments pursuant to Section 4.02(d)(vii) and (ix), and (b) the excess of (1)
the Group I Required Overcollateralization Amount for such Distribution Date
over (2) the Group I Overcollateralization Amount for such Distribution Date.

         GROUP II OVERCOLLATERALIZATION INCREASE AMOUNT: With respect to any
Distribution Date, the lesser of (a) the Group II Excess Cash Flow for such
Distribution Date available to make payments pursuant to Section 4.02(d)(viii)
plus the Group I Excess Cash Flow for such Distribution Date available to make
payments pursuant to Section 4.02(c)(vii) and (ix), and (b) the excess of (1)
the Group II Required Overcollateralization Amount for such Distribution Date
over (2) the Group II Overcollateralization Amount for such Distribution Date.

         GROUP I OVERCOLLATERALIZATION REDUCTION AMOUNT: With respect to any
Distribution Date, to the extent the Group I Excess Overcollateralization Amount
is, after taking into account all other distributions to be made on such
Distribution Date, greater than zero, the Group I Overcollateralization
Reduction Amount shall be equal to any amounts relating to principal which would
otherwise be distributed to the holders of the Class A-I Certificates on such
Distribution Date.

         GROUP II OVERCOLLATERALIZATION REDUCTION AMOUNT: With respect to any
Distribution Date, to the extent the Group II Excess Overcollateralization
Amount is, after taking into account all other distributions to be made on such
Distribution Date, greater than zero, the Group II Overcollateralization
Reduction Amount shall be equal to any amounts relating to principal which would
otherwise be distributed to the holders of the Class A-II Certificates on such
Distribution Date.

         GROUP I POOL STATED PRINCIPAL BALANCE: As to any date of determination,
the aggregate of the Stated Principal Balances of each Group I Loan that was an
Outstanding Mortgage Loan on the Due Date immediately preceding the Due Period
preceding such date of determination.

         GROUP II POOL STATED PRINCIPAL BALANCE: As to any date of
determination, the aggregate of the Stated Principal Balances of each Group II
Loan that was an Outstanding Mortgage Loan on the Due Date immediately preceding
the Due Period preceding such date of determination.

         GROUP I PRINCIPAL DISTRIBUTION AMOUNT: With respect to any Distribution
Date, the lesser of (a) the excess of (i) the Group I Available Distribution
Amount over (ii) the Group I Interest Distribution Amount and (b) the sum of:(i)
the principal portion of each Monthly Payment received or Advanced with respect
to the related Due Period on each Outstanding Mortgage Loan that is a Group I
Loan; (ii) the Stated Principal Balance of any Group I Loan repurchased during
the related Prepayment Period (or deemed to have been so repurchased in
accordance with Section 3.07(b)) pursuant to Section 2.02, 2.03, 2.04 or 4.07
and the amount of any shortfall deposited in the Custodial Account in connection
with the substitution of a Deleted Mortgage Loan that is a Group I Loan pursuant
to Section 2.03 or 2.04 during the related Prepayment Period; (iii) the
principal portion of all other unscheduled collections on the Group I Loans
(including, without limitation, Principal Prepayments in Full, Curtailments,
Insurance Proceeds, Liquidation Proceeds and REO

                                       25

<PAGE>

Proceeds) received during the related Prepayment Period (or deemed to have been
so received) to the extent applied by the Master Servicer as recoveries of
principal of the Group I Loans pursuant to Section 3.14; (iv) the principal
portion of any Realized Losses (other than Group I Excess Losses or Group II
Excess Losses) incurred (or deemed to have been incurred) on any Group I Loans
in the calendar month preceding such Distribution Date to the extent covered by
Group I Excess Cash Flow or Group II Excess Cash Flow for such Distribution
Date; and (v) the amount of any Group I Overcollateralization Increase Amount
for such Distribution Date; minus(vi) the amount of any related Group I
Overcollateralization Reduction Amount for such Distribution Date.

         GROUP II PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
Distribution Date, the lesser of (a) the excess of (i) the Group II Available
Distribution Amount over (ii) the Group II Interest Distribution Amount and (b)
the sum of:(i) the principal portion of each Monthly Payment received or
Advanced with respect to the related Due Period on each Outstanding Mortgage
Loan that is a Group II Loan; (ii) the Stated Principal Balance of any Group II
Loan repurchased during the related Prepayment Period (or deemed to have been so
repurchased in accordance with Section 3.07(b)) pursuant to Section 2.02, 2.03,
2.04 or 4.07 and the amount of any shortfall deposited in the Custodial Account
in connection with the substitution of a Deleted Mortgage Loan that is a Group
II Loan pursuant to Section 2.03 or 2.04 during the related Prepayment Period;
(iii) the principal portion of all other unscheduled collections on the Group II
Loans (including, without limitation, Principal Prepayments in Full,
Curtailments, Insurance Proceeds, Liquidation Proceeds and REO Proceeds)
received during the related Prepayment Period (or deemed to have been so
received) to the extent applied by the Master Servicer as recoveries of
principal of the Group II Loans pursuant to Section 3.14; (iv) the principal
portion of any Realized Losses (other than Group I Excess Losses or Group II
Excess Losses) incurred (or deemed to have been incurred) on any Group II Loans
in the calendar month preceding such Distribution Date to the extent covered by
Group I Excess Cash Flow or Group II Excess Cash Flow for such Distribution
Date; and (v) the amount of any Group II Overcollateralization Increase Amount
for such Distribution Date; minus (vi) the amount of any related Group II
Overcollateralization Reduction Amount for such Distribution Date; and (vii) the
amount of any Deferred Interest paid out of principal collections on the Group
II Loans as part of the Group II Interest Distribution Amount for that
Distribution Date.

         GROUP I REQUIRED OVERCOLLATERALIZATION AMOUNT: As of any Distribution
Date, (a) if such Distribution Date is prior to the Group I Stepdown Date, 1.25%
of the Group I Cut-off Date Balance, or (b) if such Distribution Date is on or
after the Group I Stepdown Date, the greatest of (i) 2.50% of the then current
aggregate Stated Principal Balances of the Group I Loans as of the end of the
related Due Period, (ii) 0.50% of the Group I Cut-off Date Balance and (iii) an
amount equal to (a) 2 (two) times (b) the excess of (x) 37.50% of the sum of the
following: (1) 100% of the aggregate Stated Principal Balance of all Group I
Loans that are 90 or more days Delinquent, (2) 75% of the aggregate Stated
Principal Balance of all Group I Loans that are in foreclosure and (3) 100% of
the aggregate Stated Principal Balance of all Group I Loans that are converted
to REO Properties, in each case as of the last day of the related Due Period,
over (y) 5 (five) times the Group I Excess Cash Flow for such Distribution Date.
The initial amount of overcollateralization with respect to the Group I Loans is
equal to approximately 0.00%. The Group I Required Overcollateralization Amount
may be reduced with the prior written consent of the Insurer and prior
notification to the Rating Agencies.

                                       26

<PAGE>

         GROUP II REQUIRED OVERCOLLATERALIZATION AMOUNT: As of any Distribution
Date, (a) if such Distribution Date is prior to the Group II Stepdown Date,
5.05% of the Group II Cut-off Date Balance, or (b) if such Distribution Date is
on or after the Group II Stepdown Date, the greatest of (i) 10.10% of the then
current aggregate Stated Principal Balances of the Group II Loans as of the end
of the related Due Period, (ii) 0.50% of the Group II Cut-off Date Balance and
(iii) an amount equal to (a) 2 (two) times (b) the excess of (x) 37.50% of the
sum of the following: (1) 100% of the aggregate Stated Principal Balance of all
Group II Loans that are 90 or more days Delinquent, (2) 75% of the aggregate
Stated Principal Balance of all Group II Loans that are in foreclosure and (3)
100% of the aggregate Stated Principal Balance of all Group II Loans that are
converted to REO Properties, in each case as of the last day of the related Due
Period, over (y) 5 (five) times the Group II Excess Cash Flow for such
Distribution Date. The initial amount of overcollateralization with respect to
the Group II Loans is equal to approximately 0.00%. The Group II Required
Overcollateralization Amount may be reduced with the prior written consent of
the Insurer and prior notification to the Rating Agencies.

         GROUP I SPECIAL HAZARD AMOUNT: As of any Distribution Date, an amount
equal to $3,767,695 minus the sum of (i) the aggregate amount of Special Hazard
Losses allocated to the Group I Loans through Subordination in accordance with
Section 4.05 and (ii) the Group I Adjustment Amount (as defined below) as most
recently calculated. For each anniversary of the Cut-off Date, the "Group I
Adjustment Amount" shall be equal to the amount, if any, by which the amount
calculated in accordance with the preceding sentence (without giving effect to
the deduction of the Group I Adjustment Amount for such anniversary) exceeds the
greater of (A) the greatest of (i) twice the outstanding principal balance of
the Group I Loan that has the largest outstanding principal balance on the
Distribution Date immediately preceding such anniversary, (ii) the product of
1.00% multiplied by the outstanding principal balance of all Group I Loans on
the Distribution Date immediately preceding such anniversary and (iii) the
aggregate outstanding principal balance (as of the immediately preceding
Distribution Date) of the Group I Loans in any single five-digit California zip
code area with the largest amount of Group I Loans by aggregate principal
balance as of such anniversary and (B) the greater of (i) the product of 0.50%
multiplied by the outstanding principal balance of all Group I Loans on the
Distribution Date immediately preceding such anniversary multiplied by a
fraction, the numerator of which is equal to the aggregate outstanding principal
balance (as of the immediately preceding Distribution Date) of all of the Group
I Loans secured by Mortgaged Properties located in the State of California
divided by the aggregate outstanding principal balance (as of the immediately
preceding Distribution Date) of all of the Group I Loans, expressed as a
percentage, and the denominator of which is equal to 24.3% (which percentage is
equal to the percentage of Group I Loans initially secured by Mortgaged
Properties located in the State of California) and (ii) the aggregate
outstanding principal balance (as of the immediately preceding Distribution
Date) of the largest Group I Loan secured by a Mortgaged Property located in the
State of California. The Group I Special Hazard Amount may be further reduced by
the Master Servicer (including accelerating the manner in which coverage is
reduced) provided that prior to any such reduction, the Master Servicer shall
obtain the written approval of the Insurer and obtain written confirmation from
each Rating Agency that such reduction shall not reduce the rating assigned to
the Class A-I Certificates without regard to the Policy by such Rating Agency
below the lower of the then-current rating or the rating assigned to such
Certificates as of the Closing Date by such Rating Agency.

                                       27

<PAGE>

         GROUP II SPECIAL HAZARD AMOUNT: As of any Distribution Date, an amount
equal to $2,414,884 minus the sum of (i) the aggregate amount of Special Hazard
Losses allocated to the Group II Loans through Subordination in accordance with
Section 4.05 and (ii) the Group II Adjustment Amount (as defined below) as most
recently calculated. For each anniversary of the Cut- off Date, the "Group II
Adjustment Amount" shall be equal to the amount, if any, by which the amount
calculated in accordance with the preceding sentence (without giving effect to
the deduction of the Group II Adjustment Amount for such anniversary) exceeds
the greater of (A) the greatest of (i) twice the outstanding principal balance
of the Group II Loan that has the largest outstanding principal balance on the
Distribution Date immediately preceding such anniversary, (ii) the product of
1.00% multiplied by the outstanding principal balance of all Group II Loans on
the Distribution Date immediately preceding such anniversary and (iii) the
aggregate outstanding principal balance (as of the immediately preceding
Distribution Date) of the Group II Loans in any single five-digit California zip
code area with the largest amount of Group II Loans by aggregate principal
balance as of such anniversary and (B) the greater of (i) the product of 0.50%
multiplied by the outstanding principal balance of all Group II Loans on the
Distribution Date immediately preceding such anniversary multiplied by a
fraction, the numerator of which is equal to the aggregate outstanding principal
balance (as of the immediately preceding Distribution Date) of all of the Group
II Loans secured by Mortgaged Properties located in the State of California
divided by the aggregate outstanding principal balance (as of the immediately
preceding Distribution Date) of all of the Group II Loans, expressed as a
percentage, and the denominator of which is equal to 22.6% (which percentage is
equal to the percentage of Group II Loans initially secured by Mortgaged
Properties located in the State of California) and (ii) the aggregate
outstanding principal balance (as of the immediately preceding Distribution
Date) of the largest Group II Loan secured by a Mortgaged Property located in
the State of California. The Group II Special Hazard Amount may be further
reduced by the Master Servicer (including accelerating the manner in which
coverage is reduced) provided that prior to any such reduction, the Master
Servicer shall obtain the written approval of the Insurer and obtain written
confirmation from each Rating Agency that such reduction shall not reduce the
rating assigned to the Class A-II Certificates without regard to the Policy by
such Rating Agency below the lower of the then-current rating or the rating
assigned to such Certificates as of the Closing Date by such Rating Agency.

         GROUP I STEPDOWN DATE: The later to occur of (i) the Distribution Date
occurring in April 2004 and (ii) the Distribution Date on which the aggregate
Stated Principal Balance of the Group I Loans is less than one-half of the Group
I Cut-off Date Balance.

         GROUP II STEPDOWN DATE: The later to occur of (i) the Distribution Date
occurring in April 2004 and (ii) the Distribution Date on which the aggregate
Stated Principal Balance of the Group II Loans is less than one-half of the
Group II Cut-off Date Balance.

         GROUP I UNCERTIFICATED REGULAR INTERESTS: The REMIC I Regular Interests
and the REMIC III Group I Regular Interests.

         GROUP II UNCERTIFICATED REGULAR INTERESTS: The REMIC II Regular
Interests and the REMIC III Group II Regular Interests.

                                       28

<PAGE>

         GROUP I WEIGHTED AVERAGE NET MORTGAGE RATE: With respect to any
Distribution Date, a per annum rate equal to the weighted average of the Net
Mortgage Rates (or, if applicable, the Modified Net Mortgage Rates) on the Group
I Loans, weighted on the basis of the respective Stated Principal Balances
thereof immediately preceding such Distribution Date.

         GROUP II WEIGHTED AVERAGE NET MORTGAGE RATE: With respect to any
Distribution Date, a per annum rate equal to the weighted average of the Net
Mortgage Rates (or, if applicable, the Modified Net Mortgage Rates) on the Group
II Loans, weighted on the basis of the respective Stated Principal Balances
thereof immediately preceding such Distribution Date.

         GROUP II WEIGHTED AVERAGE ACTUAL/360 NET MORTGAGE RATE: With respect to
any Distribution Date, the product of (i) the Group II Weighted Average Net
Mortgage Rate and (ii) a fraction equal to 30 divided by the actual number of
days in the related Interest Accrual Period.

         HAZARDOUS MATERIALS: Any dangerous, toxic or hazardous pollutants,
chemicals, wastes, or substances, including, without limitation, those so
identified pursuant to the Comprehensive Environmental Response, Compensation
and Liability Act, 42 U.S.C. Section 9601 et seq., or any other environmental
laws now existing, and specifically including, without limitation, asbestos and
asbestos-containing materials, polychlorinated biphenyls, radon gas, petroleum
and petroleum products, urea formaldehyde and any substances classified as being
"in inventory", "usable work in progress" or similar classification which would,
if classified unusable, be included in the foregoing definition.

         HIGH COST LOAN: The Mortgage Loans set forth hereto as Exhibit O that
are subject to special rules, disclosure requirements and other provisions that
were added to the Federal Truth in Lending Act by the Home Ownership and Equity
Protection Act of 1994.

         HOMECOMINGS: HomeComings Financial Network, Inc., a wholly-owned
subsidiary of Residential Funding.

         INDEPENDENT: When used with respect to any specified Person, means such
a Person who (i) is in fact independent of the Depositor, the Master Servicer
and the Trustee, or any Affiliate thereof, (ii) does not have any direct
financial interest or any material indirect financial interest in the Depositor,
the Master Servicer or the Trustee or in an Affiliate thereof, and (iii) is not
connected with the Depositor, the Master Servicer or the Trustee as an officer,
employee, promoter, underwriter, trustee, partner, director or person performing
similar functions.

         INDEX: With respect to any adjustable rate Mortgage Loan and as to any
Adjustment Date therefor, the related index as stated in the related Mortgage
Note.

         INITIAL CERTIFICATE PRINCIPAL BALANCE: With respect to each Class of
Certificates (other than the Class A-I-IO Certificates and the Class R
Certificates), the Certificate Principal Balance of such Class of Certificates
as of the Cut-off Date as set forth in the Preliminary Statement hereto.

         INSURANCE ACCOUNT: The account or accounts created and maintained
pursuant to Section 4.08, which shall be entitled "Bank One, National
Association, as trustee, in trust for the registered holders

                                       29

<PAGE>

of Residential Asset Mortgage Products, Inc., Mortgage Asset-Backed Pass-Through
Certificates, Series 2001-RS3," and which must be an Eligible Account.

         INSURANCE AGREEMENT: The Insurance and Indemnity Agreement, dated as of
October 25, 2001, among the Insurer, the Trustee, the Master Servicer and the
Depositor.

         INSURANCE PROCEEDS: Proceeds paid in respect of the Mortgage Loans
pursuant to any Primary Insurance Policy or any other related insurance policy
covering a Mortgage Loan, to the extent such proceeds are payable to the
mortgagee under the Mortgage, any Subservicer, the Master Servicer or the
Trustee and are not applied to the restoration of the related Mortgaged Property
(or, with respect to a Cooperative Loan, the related Cooperative Apartment) or
released to the Mortgagor in accordance with the procedures that the Master
Servicer would follow in servicing mortgage loans held for its own account.

         INSURED AMOUNT: With respect to the Class A Certificates, as of any
Distribution Date, the Deficiency Amount, if any, for such Distribution Date.

         INSURER: Ambac Assurance Corporation, a Wisconsin-domiciled stock
insurance corporation or its successors in interest.

         INSURER ACCOUNT: An account of the Insurer maintained at Citibank, N.A.
(ABA No. 021- 000089), Account No. 40609486, Attention: Pamela Dottin, or such
other account as may be designated by the Insurer to the Trustee in writing not
less than five Business Days prior to the related Distribution Date.

         INSURER DEFAULT: The existence and continuance of any of the following:
(a) a failure by the Insurer to make a payment required under the Policy in
accordance with its terms; or (b)(i) the Insurer (A) files any petition or
commences any case or proceeding under any provision or chapter of the
Bankruptcy Code or any other similar federal or state law relating to
insolvency, bankruptcy, rehabilitation, liquidation or reorganization, (B) makes
a general assignment for the benefit of its creditors, or (C) has an order for
relief entered against it under the Bankruptcy Code or any other similar federal
or state law relating to insolvency, bankruptcy, rehabilitation, liquidation or
reorganization which is final and nonappealable; or (ii) a court of competent
jurisdiction, the Wisconsin insurance department or other competent regulatory
authority enters a final and nonappealable order, judgment or decree (A)
appointing a custodian, trustee, agent or receiver for the Insurer or for all or
any material portion of its property or (B) authorizing the taking of possession
by a custodian, trustee, agent or receiver of the Insurer (or the taking of
possession of all or any material portion of the property of the Insurer).

         INTEREST ACCRUAL PERIOD: With respect to the Class A-I Certificates
(other than the Class A-I-1 Certificates), the Class SB-I Certificates and any
Distribution Date, the prior calendar month. With respect to the Class A-I-1
Certificates, Class A-II Certificates and Class SB-II Certificates (i) with
respect to the Distribution Date in November 2001, the period commencing the
Closing Date and ending on the day preceding the Distribution Date in November
2001, and (ii) with respect to any Distribution Date after the Distribution Date
in November 2001, the period commencing on the

                                       30

<PAGE>

Distribution Date in the month immediately preceding the month in which such
Distribution Date occurs and ending on the day preceding such Distribution Date.

         INTERIM CERTIFICATION: As defined in Section 2.02.

         INTERESTED PERSON: As of any date of determination, the Depositor, the
Master Servicer, the Insurer, the Trustee, any Mortgagor, any Manager of a
Mortgaged Property, or any Person known to a Responsible Officer of the Trustee
to be an Affiliate of any of them.

         LATE COLLECTIONS: With respect to any Mortgage Loan, all amounts
received during any Due Period, whether as late payments of Monthly Payments or
as Insurance Proceeds, Liquidation Proceeds or otherwise, which represent late
payments or collections of Monthly Payments due but delinquent for a previous
Due Period and not previously recovered.

         LATE PAYMENT RATE: As defined in the Insurance Agreement.

         LIBOR: With respect to any Distribution Date, the arithmetic mean of
the London interbank offered rate quotations for one-month U.S. Dollar deposits,
expressed on a per annum basis, determined in accordance with Section 1.02.

         LIBOR BUSINESS DAY: Any day other than (i) a Saturday or Sunday or (ii)
a day on which banking institutions in London, England are required or
authorized to by law to be closed.

         LIBOR CERTIFICATES: The Class A-I-1 Certificates and the Class A-II
Certificates.

         LIBOR RATE ADJUSTMENT DATE: With respect to each Distribution Date, the
second LIBOR Business Day immediately preceding the commencement of the related
Interest Accrual Period.

         LIQUIDATION PROCEEDS: Amounts (other than Insurance Proceeds) received
by the Master Servicer in connection with the taking of an entire Mortgaged
Property by exercise of the power of eminent domain or condemnation or in
connection with the liquidation of a defaulted Loan through trustee's sale,
foreclosure sale or otherwise, other than REO Proceeds.

         LOAN-TO-VALUE RATIO: As of any date, the fraction, expressed as a
percentage, the numerator of which is the current principal balance of the
related Mortgage Loan at the date of determination and the denominator of which
is the Appraised Value of the related Mortgaged Property.

         MARKER RATE: With respect to the Class SB-I Certificates and any
Distribution Date, a per annum rate equal to two (2) times the weighted average
of the Uncertificated REMIC III Pass- Through Rates for REMIC III Regular
Interest MT-I-2, REMIC III Regular Interest MT-I-3, REMIC III Regular Interest
MT-I-4, REMIC III Regular Interest MT-I-5, REMIC III Regular Interest MT-I-6 and
REMIC III Regular Interest MT-I-7, with the rate on REMIC III Regular Interest
MT-I-2 subject to a cap equal to the least of (a) LIBOR plus 0.23%, (b) 14.00%
per annum and (c) the Group I Adjusted Net WAC Rate for the purpose of this
calculation; with the rate on REMIC III Regular Interest MT-I-3 subject to a cap
equal to the lesser of (a) 4.60% per annum and (b) the Group I Adjusted Net WAC
Rate for the purpose of this calculation; with the rate on REMIC III Regular

                                       31

<PAGE>

Interest MT-I-4 subject to a cap equal to the lesser of (a) 5.50% per annum and
(b) the Group I Adjusted Net WAC Rate for the purpose of this calculation; with
the rate on REMIC III Regular Interest MT-I-5 subject to a cap equal to the
lesser of (a) (i) before the first Distribution Date after the first possible
Group I Optional Termination Date, 6.29% per annum or (ii) on or after the first
Distribution Date after the first possible Group I Optional Termination Date,
6.79% per annum and (b) the Group I Adjusted Net WAC Rate for purposes of this
calculation; with the rate on REMIC III Regular Interest MT-I-6 subject to a cap
equal to the lesser of (a) 5.70% per annum and (b) the Group I Adjusted Net WAC
Rate for purposes of this calculation; and with the rate on REMIC III Regular
Interest MT-I-7 subject to a cap of zero for the purpose of this calculation.
With respect to the Class SB-II Certificates and any Distribution Date, a per
annum rate equal to two (2) times the weighted average of the Uncertificated
REMIC III Pass-Through Rates for REMIC III Regular Interest MT-II-2 and REMIC
III Regular Interest MT-II-3, with the rate on REMIC III Regular Interest
MT-II-2 subject to a cap equal to the least of (a) LIBOR plus the related Class
A-II Margin, (b) the Maximum Class A-II Rate and (c) the Group II Weighted
Average Actual/360 Net Mortgage Rate for the purpose of this calculation; and
with the rate on REMIC III Regular Interest MT-II-3 subject to a cap of zero for
the purpose of this calculation.

         MATURITY DATE: With respect to each Class of Certificates of regular
interest or Uncertificated Regular Interest issued by each of REMIC I, REMIC II,
REMIC III and REMIC IV, the latest possible maturity date, solely for purposes
of Section 1.860G-1(a)(4)(iii) of the Treasury Regulations, by which the
Certificate Principal Balance of each such Class of Certificates representing a
regular interest in the Trust Fund would be reduced to zero, which is, for each
such regular interest other than the Class A-I-IO Certificates, October 25,
2031, which is the Distribution Date following the last scheduled monthly
payment of the Group I Mortgage Loans and the Group II Mortgage Loans, and which
is for the Class A-I-IO Certificates, April 25, 2004.

         MAXIMUM CLASS A-I-1 RATE: With respect to the Class A-I-1 Certificates
and any Interest Accrual Period, 14.00% per annum.

         MAXIMUM CLASS A-II RATE: With respect to the Class A-II Certificates
and any Interest Accrual Period, 14.00% per annum.

         MAXIMUM MORTGAGE RATE: As to any adjustable rate Mortgage Loan, the
rate indicated in Exhibit F-2 hereto as the "NOTE CEILING," which rate is the
maximum interest rate that may be applicable to such adjustable rate Mortgage
Loan at any time during the life of such Mortgage Loan.

         MAXIMUM NET MORTGAGE RATE: As to any Group II Loan and any date of
determination, the Maximum Mortgage Rate minus the sum of (i) the rate at which
the related Subservicing Fee accrues, (ii) the Servicing Fee Rate, and (iii) the
Certificate Insurer Premium Modified Rate as of such date.

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

         MERS(R) SYSTEM: The system of recording transfers of Mortgages
electronically maintained by MERS.

                                       32

<PAGE>

         MIN: The Mortgage Identification Number for Mortgage Loans registered
with MERS on the MERS(R)System.

         MINIMUM MORTGAGE RATE: As to any adjustable rate Mortgage Loan, the
greater of (i) the Note Margin and (ii) the rate indicated in Exhibit F-2 hereto
as the "NOTE FLOOR", which rate may be applicable to such adjustable rate
Mortgage Loan at any time during the life of such adjustable rate Mortgage Loan.

         MODIFIED MORTGAGE LOAN: Any Mortgage Loan that has been the subject of
a Servicing Modification.

         MODIFIED NET MORTGAGE RATE: As to any Mortgage Loan that is the subject
of a Servicing Modification, the Net Mortgage Rate minus the rate per annum by
which the Mortgage Rate on such Mortgage Loan was reduced.

         MOM LOAN: With respect to any Mortgage Loan, MERS acting as the
mortgagee of such Mortgage Loan, solely as nominee for the originator of such
Mortgage Loan and its successors and assigns, at the origination thereof.

         MONTHLY PAYMENT: With respect to any Mortgage Loan (including any REO
Property) and the Due Date in any Due Period, the payment of principal and
interest due thereon in accordance with the amortization schedule at the time
applicable thereto (after adjustment, if any, for Curtailments and for Deficient
Valuations occurring prior to such Due Date but before any adjustment to such
amortization schedule by reason of any bankruptcy, other than a Deficient
Valuation, or similar proceeding or any moratorium or similar waiver or grace
period and before any Servicing Modification that constitutes a reduction of the
interest rate on such Mortgage Loan).

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

         MORTGAGE: With respect to each Mortgage Note related to a Mortgage Loan
which is not a Cooperative Loan, the mortgage, deed of trust or other comparable
instrument creating a first or junior lien on an estate in fee simple or
leasehold interest in real property securing a Mortgage Note.

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

         MORTGAGE LOAN ACCRUED INTEREST: With respect to each Neg Am Loan and
each Due Date, the aggregate amount of interest accrued at the Mortgage Rate in
respect of such Mortgage Loan since the preceding Due Date (or in the case of
the initial Due Date, since the Cut-off Date) to but not including such Due Date
with respect to which the Mortgage Loan Accrued Interest is being calculated in
accordance with the terms of such Mortgage Loan, after giving effect to any
previous Principal Prepayments, Deficient Valuation or Debt Service Reduction in
respect of such Neg Am Loan.

                                       33

<PAGE>

         MORTGAGE LOAN SCHEDULE: The lists of the Mortgage Loans attached hereto
as Exhibit F-1 and Exhibit F-2 (as amended from time to time to reflect the
addition of Qualified Substitute Mortgage Loans), which lists shall set forth at
a minimum the following information as to each Mortgage Loan:

         (i) the Mortgage Loan identifying number ("RFC LOAN #");

         (ii) [reserved];

         (iii) the maturity of the Mortgage Note ("MATURITY DATE", or "MATURITY
         DT" for Mortgage Loans and if such Mortgage Loan is a Balloon Loan, the
         amortization term thereof;

         (iv) the Mortgage Rate as of the Cut-off Date ("ORIG RATE")

         (v) the Mortgage Rate as of the Cut-off Date for an adjustable rate
         Mortgage Loan ("CURR RATE");

         (vi) the Adjusted Net Mortgage Rate as of the Cut-off Date ("CURR
         NET");

         (vii) the scheduled monthly payment of principal, if any, and interest
         as of the Cut-off Date ("ORIGINAL P & I" or "CURRENT P & I" for the
         adjustable rate Mortgage Loans);

         (viii) the Cut-off Date Principal Balance ("PRINCIPAL BAL");

         (ix) the Loan-to-Value Ratio at origination ("LTV");

         (x) a code "T", "BT" or "CT" under the column "LN FEATURE," indicating
         that the Mortgage Loan is secured by a second or vacation residence
         (the absence of any such code means the Mortgage Loan is secured by a
         primary residence);

         (xi) a code "N" under the column "OCCP CODE", indicating that the
         Mortgage Loan is secured by a non-owner occupied residence (the absence
         of any such code means the Mortgage Loan is secured by an owner
         occupied residence);

         (xii) the Maximum Mortgage Rate for the adjustable rate Mortgage Loans
         ("NOTE CEILING");

         (xiii) the maximum Adjusted Net Mortgage Rate for the adjustable rate
         Mortgage Loans ("NET CEILING");

         (xiv) the Note Margin for the adjustable rate Mortgage Loans ("NOTE
         MARGIN");

         (xv) the first Adjustment Date after the Cut-off Date for the
         adjustable rate Mortgage Loans ("NXT INT CHG DT");

                                       34

<PAGE>

         (xvi) the Periodic Cap for the adjustable rate Mortgage Loans
         ("PERIODIC DECR" or "PERIODIC INCR");

         (xvii) the rounding of the semi-annual or annual adjustment to the
         Mortgage Rate with respect to the adjustable rate Mortgage Loans ("NOTE
         METHOD"); and

         (xviii) whether such Mortgage Loan is a Neg Am Loan ("MAX NEG AM"
         greater than 100).

         Such schedules may consist of multiple reports that collectively set
forth all of the information required.

         MORTGAGE LOANS: Such of the mortgage loans transferred and assigned to
the Trustee pursuant to Section 2.01 as from time to time are held or deemed to
be held as a part of the Trust Fund, the Mortgage Loans originally so held being
identified in the initial Mortgage Loan Schedule, and Qualified Substitute
Mortgage Loans held or deemed held as part of the Trust Fund including, without
limitation, (i) with respect to each Cooperative Loan, the related Mortgage
Note, Security Agreement, Assignment of Proprietary Lease, Cooperative Stock
Certificate, Cooperative Lease and Mortgage File and all rights appertaining
thereto, and (ii) with respect to each Mortgage Loan other than a Cooperative
Loan, each related Mortgage Note, Mortgage and Mortgage File and all rights
appertaining thereto.

         MORTGAGE NOTE: The originally executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a Mortgage Loan,
together with any modification thereto.

         MORTGAGE RATE: As to any Mortgage Loan, the interest rate borne by the
related Mortgage Note, or any modification thereto other than a Servicing
Modification. The Mortgage Rate on the adjustable rate Mortgage Loans will
adjust on each Adjustment Date to equal the sum (rounded to the nearest multiple
of one-eighth of one percent (0.125%) or up to the nearest one-eighth of one
percent, which are indicated by a "U" on Exhibit F-1 or Exhibit F-2 hereto, as
applicable, except in the case of the adjustable rate Mortgage Loans indicated
by an "X" on Exhibit F-1 or Exhibit F-2 hereto under the heading "NOTE METHOD"),
of the related Index plus the Note Margin, in each case subject to the
applicable Periodic Cap, Maximum Mortgage Rate and Minimum Mortgage Rate.

         MORTGAGED PROPERTY: The underlying real property securing a Mortgage
Loan or, with respect to a Cooperative Loan, the related Cooperative Lease and
Cooperative Stock.

         MORTGAGOR: The obligor on a Mortgage Note.

         NEG AM LOAN: Any Mortgage Loan providing for negative amortization, as
indicated in the Mortgage Loan Schedule.

         NET COLLECTIONS: With respect to any Corrected Mortgage Loan, an amount
equal to all payments on account of interest and principal on such Mortgage
Loan.

                                       35

<PAGE>

         NET MORTGAGE RATE: With respect to any Mortgage Loan as of any date of
determination, a per annum rate equal to the Adjusted Mortgage Rate for such
Mortgage Loan as of such date minus the sum of (i) the Servicing Fee Rate and
(ii) the Certificate Insurer Premium Modified Rate; provided that, with respect
to any Group II Loans, (i) the Net Mortgage Rate becoming effective on any
Adjustment Date shall not be greater or less than the Net Mortgage Rate
immediately prior to such Adjustment Date plus or minus the Periodic Cap
applicable to such Group II Loan and (ii) the Net Mortgage Rate for any Group II
Loan shall not exceed a rate equal to the Maximum Net Mortgage Rate for such
Group II Loan.

         NON-PRIMARY RESIDENCE LOANS: The Mortgage Loans designated as secured
by second or vacation residences, or by non-owner occupied residences, on the
Mortgage Loan Schedule.

         NON-UNITED STATES PERSON: Any Person other than a United States Person.

         NONRECOVERABLE ADVANCE: Any Advance previously made or proposed to be
made by the Master Servicer in respect of a Mortgage Loan (other than a Deleted
Mortgage Loan) which, in the good faith judgment of the Master Servicer, will
not, or, in the case of a proposed Advance, would not, be ultimately recoverable
by the Master Servicer from related Late Collections, Insurance Proceeds,
Liquidation Proceeds or REO Proceeds. To the extent that any Mortgagor is not
obligated under the related Mortgage documents to pay or reimburse any portion
of any Advances that are outstanding with respect to the related Mortgage Loan
as a result of a modification of such Mortgage Loan by the Master Servicer,
which forgives unpaid Monthly Payments or other amounts which the Master
Servicer had previously advanced, and the Master Servicer determines that no
other source of payment or reimbursement for such advances is available to it,
such Advances shall be deemed to be nonrecoverable; PROVIDED, HOWEVER, that in
connection with the foregoing, the Master Servicer shall provide an Officers'
Certificate as described below. The determination by the Master Servicer that it
has made a Nonrecoverable Advance shall be evidenced by a certificate of a
Servicing Officer, Responsible Officer or Vice President or its equivalent or
senior officer of the Master Servicer, delivered to the Depositor, the Trustee,
the Insurer and the Master Servicer setting forth such determination, which
shall include any other information or reports obtained by the Master Servicer
such as property operating statements, rent rolls, property inspection reports
and engineering reports, which may support such determinations. Notwithstanding
the above, the Trustee shall be entitled to rely upon any determination by the
Master Servicer that any Advance previously made is a Nonrecoverable Advance or
that any proposed Advance, if made, would constitute a Nonrecoverable Advance.

         NONSUBSERVICED MORTGAGE LOAN: Any Mortgage Loan that, at the time of
reference thereto, is not subject to a Subservicing Agreement.

         NOTE MARGIN: As to each adjustable rate Mortgage Loan, the fixed
percentage set forth in the related Mortgage Note and indicated in Exhibit F-2
hereto as the "NOTE MARGIN," which percentage is added to the Index on each
Adjustment Date to determine (subject to rounding in accordance with the related
Mortgage Note, the Periodic Cap, the Maximum Mortgage Rate and the Minimum
Mortgage Rate) the interest rate to be borne by such adjustable rate Mortgage
Loan until the next Adjustment Date.

                                       36

<PAGE>

         NOTICE: As defined in Section 4.04.

         NOTIONAL AMOUNT: With respect to the Class A-I-IO Certificates
immediately prior to any Distribution Date, the lesser of (i)(a) from the
November 2001 through the January 2004 Distribution Date, $47,100,000 or (b)
from the February 2004 through the April 2004 Distribution Dates, $37,677,000
and (ii) the sum of the aggregate Stated Principal Balance of the Group I Loans,
prior to giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced, and unscheduled collections of
principal received during the prior calendar month. For federal income tax
purposes, however, with respect to the Class A-I-IO Certificates will not have a
notional amount, but will be entitled to 100% of the interest payable on REMIC
III Regular Interest MT-I-IO. With respect to the Class SB-I Certificates,
immediately prior to any Distribution Date, the aggregate of the Uncertificated
Principal Balances of the REMIC III Group I Regular Interests (other than REMIC
III Regular Interest MT-I-IO). With respect to the Class SB-II Certificates,
immediately prior to any Distribution Date, the aggregate of the Uncertificated
Principal Balances of the REMIC III Group II Regular Interests.

         OFFICERS' CERTIFICATE: A certificate signed by the Chairman of the
Board, the President or a Vice President or Assistant Vice President, or a
Director or Managing Director, and by the Treasurer, the Secretary, or one of
the Assistant Treasurers or Assistant Secretaries of the Depositor or the Master
Servicer, as the case may be, and delivered to the Trustee and the Insurer, as
required by this Agreement.

         OPINION OF COUNSEL: A written opinion of counsel acceptable to the
Trustee, the Insurer and the Master Servicer, who may be counsel for the
Depositor or the Master Servicer, provided that any opinion of counsel (i)
referred to in the definition of "Disqualified Organization" or (ii) relating to
the qualification of REMIC I, REMIC II, REMIC III or REMIC IV as REMICs or
compliance with the REMIC Provisions must, unless otherwise specified, be an
opinion of Independent counsel.

         OUTSTANDING MORTGAGE LOAN: As to the Due Date in any Due Period, a
Mortgage Loan (including an REO Property) that was not the subject of a
Principal Prepayment in Full, Cash Liquidation or REO Disposition and that was
not purchased, deleted or substituted for prior to such Due Date pursuant to
Section 2.02, 2.03, 2.04 or 4.07.

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

         PASS-THROUGH RATE: With respect to the Class A-I-1 Certificates and
each Interest Accrual Period, a per annum rate equal to the least of (a) LIBOR
plus 0.23% (b) the Maximum Class A-I-1 Rate and (c) the Group I Adjusted Net WAC
Rate. With respect to the Class A-I-2 Certificates and each Interest Accrual
Period, a per annum rate equal to the lesser of (a) 4.60% per annum and (b) the
Group I Adjusted Net WAC Rate. With respect to the Class A-I-3 Certificates and
each Interest Accrual Period, a per annum rate equal to the lesser of (a) 5.50%
per annum and (b) the Group I Adjusted Net WAC Rate. With respect to the Class
A-I-4 Certificates and each Interest Accrual Period, a per annum rate equal to
the lesser of (a) 6.29% per annum and (b) the Group I Adjusted Net WAC Rate and
(ii) on or after the first Distribution Date after the first possible Group I
Optional

                                       37

<PAGE>

Termination Date, a per annum rate equal to the lesser of (a) 6.79% per annum
and (b) the Group I Adjusted Net WAC Rate. With respect to the Class A-I-5
Certificates and each Interest Accrual Period, a per annum rate equal to the
lesser of (a) 5.70% per annum and (b) the Group I Adjusted Net WAC Rate. With
respect to the Class A-I-IO Certificates and each Interest Accrual Period, (i)
in the case of any Distribution Date up to and including the 30th Distribution
Date, 6.00% per annum and (ii) in the case of any Distribution Date after the
30th Distribution Date, 0.00% per annum. For federal income tax purposes,
however, the Class A-I-IO Certificates will not have a Pass-Through Rate but
will be entitled to 100% of the interest on REMIC III Regular Interest MT-I-IO.
With respect to the Class A-II Certificates and each Interest Accrual Period, a
per annum rate equal to the least of (i) LIBOR plus the Class A-II Margin, (ii)
the Maximum Class A-II Rate and (iii) the Group II Weighted Average Actual/360
Net Mortgage Rate. With respect to the Class SB-I Certificates and any
Distribution Date, a rate per annum equal to the percentage equivalent of a
fraction, the numerator of which is the sum of the amounts calculated pursuant
to clauses (i) through (vii) below, and the denominator of which is the
aggregate Uncertificated Principal Balance of the REMIC III Group I Regular
Interests. For purposes of calculating the Pass-Through Rate for the Class SB-I
Certificates, the numerator is equal to the sum of the following components: (i)
the Uncertificated Pass-Through Rate for REMIC III Regular Interest MT-I-1 minus
the Marker Rate, applied to a notional amount equal to the Uncertificated
Principal Balance of REMIC III Regular Interest MT-I-1; (ii) the Uncertificated
Pass-Through Rate for REMIC III Regular Interest MT-I-2 minus the Marker Rate,
applied to a notional amount equal to the Uncertificated Principal Balance of
REMIC III Regular Interest MT-I-1; (iii) the Uncertificated Pass-Through Rate
for REMIC III Regular Interest MT-I-3 minus the Marker Rate, applied to a
notional amount equal to the Uncertificated Principal Balance of REMIC III
Regular Interest MT-I-3; (iv) the Uncertificated Pass-Through Rate for REMIC III
Regular Interest MT-I-4 minus the Marker Rate, applied to a notional amount
equal to the Uncertificated Principal Balance of REMIC III Regular Interest
MT-I-4; (v) the Uncertificated Pass-Through Rate for REMIC III Regular Interest
MT-I-5 minus the Marker Rate, applied to a notional amount equal to the
Uncertificated Principal Balance of REMIC III Regular Interest MT-I-5; (vi) the
Uncertificated Pass-Through Rate for REMIC III Regular Interest MT-I-6 minus the
Marker Rate applied to a notional amount equal to the Uncertificated Principal
Balance Uncertificated REMIC III Regular Interest of MT-I-6; and (vii) the
Uncertificated Pass-Through Rate for REMIC III Regular Interest MT-I-7 minus the
Marker Rate, applied to a notional amount equal to the Uncertificated Principal
Balance of REMIC III Regular Interest MT-I-7;; With respect to the Class SB-II
Certificates and any Distribution Date, a rate per annum equal to the percentage
equivalent of a fraction, the numerator of which is the sum of the amounts
calculated pursuant to clauses (i) through (iii) below, and the denominator of
which is the aggregate Uncertificated Principal Balance of the REMIC III Group
II Regular Interests. For purposes of calculating the Pass-Through Rate for the
Class SB-II Certificates, the numerator is equal to the sum of the following
components: (i) the Uncertificated Pass-Through Rate for REMIC III Regular
Interest MT-II-1 minus the Marker Rate, applied to a notional amount equal to
the Uncertificated Balance of REMIC III Regular Interest MT- II-1; (ii) the
Uncertificated Pass-Through Rate for REMIC III Regular Interest MT-II-2 minus
the Marker Rate, applied to a notional amount equal to the Uncertificated
Balance of REMIC III Regular Interest MT-II-2; and (iii) the Uncertificated
Pass-Through Rate for REMIC III Regular Interest MT- II-3 minus the Marker Rate,
applied to a notional amount equal to the Uncertificated Balance of REMIC III
Regular Interest MT-II-3.

                                       38

<PAGE>

         PAYING AGENT: Bank One, National Association or any successor Paying
Agent appointed by the Trustee.

         PERCENTAGE INTEREST: With respect to any Class A Certificate, the
undivided percentage ownership interest in the related Class evidenced by such
Certificate, which percentage ownership interest shall be equal to the Initial
Certificate Principal Balance thereof divided by the aggregate Initial
Certificate Principal Balance of all of the Certificates of the same Class. The
Percentage Interest with respect to a Class SB or Class R Certificate shall be
stated on the face thereof.

         PERIODIC CAP: With respect to each adjustable rate Mortgage Loan, the
periodic rate cap that limits the increase or the decrease of the related
Mortgage Rate on any Adjustment Date pursuant to the terms of the related
Mortgage Note.

         PERMITTED INVESTMENTS: One or more of the following:

         (i) obligations of or guaranteed as to principal and interest by the
         United States or any agency or instrumentality thereof when such
         obligations are backed by the full faith and credit of the United
         States;

         (ii) repurchase agreements on obligations specified in clause (i)
         maturing not more than one month from the date of acquisition thereof,
         provided that the unsecured obligations of the party agreeing to
         repurchase such obligations are at the time rated by each Rating Agency
         in its highest short-term rating available;

         (iii) federal funds, certificates of deposit, demand deposits, time
         deposits and bankers' acceptances (which shall each have an original
         maturity of not more than 90 days and, in the case of bankers'
         acceptances, shall in no event have an original maturity of more than
         365 days or a remaining maturity of more than 30 days) denominated in
         United States dollars of any U.S. depository institution or trust
         company incorporated under the laws of the United States or any state
         thereof or of any domestic branch of a foreign depository institution
         or trust company; provided that the debt obligations of such depository
         institution or trust company (or, if the only Rating Agency is Standard
         & Poor's, in the case of the principal depository institution in a
         depository institution holding company, debt obligations of the
         depository institution holding company) at the date of acquisition
         thereof have been rated by each Rating Agency in its highest short-term
         rating available; and provided further that, if the only Rating Agency
         is Standard & Poor's and if the depository or trust company is a
         principal subsidiary of a bank holding company and the debt obligations
         of such subsidiary are not separately rated, the applicable rating
         shall be that of the bank holding company; and, provided further that,
         if the original maturity of such short-term obligations of a domestic
         branch of a foreign depository institution or trust company shall
         exceed 30 days, the short- term rating of such institution shall be
         A-1+ in the case of Standard & Poor's if Standard & Poor's is a Rating
         Agency;

         (iv) commercial paper and demand notes (having original maturities of
         not more than 365 days) of any corporation incorporated under the laws
         of the United States or any state thereof which on the date of
         acquisition has been rated by each Rating Agency in its highest short-

                                       39

<PAGE>

         term rating available; provided that such commercial paper and demand
         notes shall have a remaining maturity of not more than 30 days;

         (v) a money market fund or a qualified investment fund rated by each
         Rating Agency in its highest long-term rating available; and

         (vi) other obligations or securities that are acceptable to the Insurer
         and each Rating Agency as a Permitted Investment hereunder and will not
         reduce the rating assigned to any Class of Certificates by such Rating
         Agency below the lower of the then-current rating or the rating
         assigned to such Certificates as of the Closing Date by such Rating
         Agency, as evidenced in writing;

PROVIDED, HOWEVER, that no instrument shall be a Permitted Investment if it
represents, either (1) the right to receive only interest payments with respect
to the underlying debt instrument or (2) the right to receive both principal and
interest payments derived from obligations underlying such instrument and the
principal and interest payments with respect to such instrument provide a yield
to maturity greater than 120% of the yield to maturity at par of such underlying
obligations. References herein to the highest rating available on unsecured
long-term debt shall mean AAA in the case of Standard & Poor's and Fitch and Aaa
in the case of Moody's, and references herein to the highest rating available on
unsecured commercial paper and short-term debt obligations shall mean the
following: A-1 in the case of Standard & Poor's, P-1 in the case of Moody's and
F-1 in the case of Fitch.

         PERMITTED TRANSFEREE: Any Transferee of a Class R Certificate, other
than a Disqualified Organization or Non-United States Person.

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

         POLICY: The Certificate Guaranty Insurance Policy No. AB0496BE issued
by the Insurer in respect of the Class A Certificates, a copy of which is
attached hereto as Exhibit Q.

         PREPAYMENT ASSUMPTION: With respect to the Class A Certificates, the
prepayment assumption to be used for determining the accrual of original issue
discount and premium and market discount on such Certificates for federal income
tax purposes, which assumes a constant prepayment rate of 18% per annum with
respect to the fixed rate Mortgage Loans, and 25% per annum with respect to the
adjustable rate Mortgage Loans.

         PREPAYMENT INTEREST SHORTFALL: As to any Distribution Date and any
Mortgage Loan (other than a Mortgage Loan relating to an REO Property) that was
the subject of (a) a Principal Prepayment in Full during the related Prepayment
Period, an amount equal to the excess of one month's interest at the related Net
Mortgage Rate (or Modified Net Mortgage Rate in the case of a Modified Mortgage
Loan) on the Stated Principal Balance of such Mortgage Loan over the amount of
interest (adjusted to the related Net Mortgage Rate (or Modified Net Mortgage
Rate in the case of a Modified Mortgage Loan)) paid by the Mortgagor for such
Prepayment Period to the date of such Principal Prepayment in Full or (b) a
Curtailment during the prior calendar month, an amount

                                       40

<PAGE>

equal to one month's interest at the related Net Mortgage Rate (or Modified Net
Mortgage Rate in the case of a Modified Mortgage Loan) on the amount of such
Curtailment.

         PREPAYMENT PERIOD: As to any Distribution Date, the calendar month
preceding the month of distribution.

         PRIMARY INSURANCE POLICY: Each primary policy of mortgage guaranty
insurance as indicated on Exhibit F-1 and Exhibit F-2 with the exception of
either code "23" or "96" under the column "MI CO CODE".

         PRINCIPAL PREPAYMENT: Any payment of principal or other recovery on a
Mortgage Loan, including a recovery that takes the form of Liquidation Proceeds
or Insurance Proceeds, which is received in advance of its scheduled Due Date
and is not accompanied by an amount as to interest representing scheduled
interest on such payment due on any date or dates in any month or months
subsequent to the month of prepayment.

         PRINCIPAL PREPAYMENT IN FULL: Any Principal Prepayment made by a
Mortgagor of the entire principal balance of a Mortgage Loan.

         PROGRAM GUIDE: The Residential Funding Seller Guide for mortgage
collateral sellers that participate in Residential Funding's standard mortgage
programs, and Residential Funding's Servicing Guide and any other subservicing
arrangements which Residential Funding has arranged to accommodate the servicing
of the Mortgage Loans.

         PURCHASE PRICE: With respect to any Mortgage Loan (or REO Property)
required to be or otherwise purchased on any date pursuant to Section 2.02,
2.03, 2.04 or 4.07, an amount equal to the sum of (i) 100% of the Stated
Principal Balance thereof plus the principal portion of any related unreimbursed
Advances and (ii) unpaid accrued interest at the Adjusted Mortgage Rate (or
Modified Net Mortgage Rate plus the rate per annum at which the Servicing Fee
and the Certificate Insurer Premium Modified Rate, if any, is calculated in the
case of a Modified Mortgage Loan) (or at the Net Mortgage Rate (or Modified Net
Mortgage Rate in the case of a Modified Mortgage Loan)) plus the Certificate
Insurer Premium Modified Rate, if any, in the case of a purchase made by the
Master Servicer) on the Stated Principal Balance thereof to the first day of the
month following the month of purchase from the Due Date to which interest was
last paid by the Mortgagor.

         QUALIFIED INSURER: A mortgage guaranty insurance company duly qualified
as such under the laws of the state of its principal place of business and each
state having jurisdiction over such insurer in connection with the insurance
policy issued by such insurer, duly authorized and licensed in such states to
transact a mortgage guaranty insurance business in such states and to write the
insurance provided by the insurance policy issued by it, approved as a FNMA- or
FHLMC-approved mortgage insurer or having a claims paying ability rating of at
least "AA" or equivalent rating by a nationally recognized statistical rating
organization. Any replacement insurer with respect to a Mortgage Loan must have
at least as high a claims paying ability rating as the insurer it replaces had
on the Closing Date.

                                       41

<PAGE>

         QUALIFIED SUBSTITUTE MORTGAGE LOAN: A Mortgage Loan substituted by
Residential Funding or the Depositor for a Deleted Mortgage Loan which must, on
the date of such substitution, as confirmed in an Officers' Certificate
delivered to the Trustee, (i) have an outstanding principal balance, after
deduction of the principal portion of the monthly payment due in the month of
substitution (or in the case of a substitution of more than one Mortgage Loan
for a Deleted Mortgage Loan, an aggregate outstanding principal balance, after
such deduction), not in excess of the Stated Principal Balance of the Deleted
Mortgage Loan (the amount of any shortfall to be deposited by Residential
Funding, in the Custodial Account in the month of substitution); (ii) have a
Mortgage Rate and a Net Mortgage Rate no lower than and not more than 1% per
annum higher than the Mortgage Rate and Net Mortgage Rate, respectively, of the
Deleted Mortgage Loan as of the date of substitution; (iii) have a Loan-to-Value
Ratio at the time of substitution no higher than that of the Deleted Mortgage
Loan at the time of substitution; (iv) have a remaining term to stated maturity
not greater than (and not more than one year less than) that of the Deleted
Mortgage Loan; (v) comply with each representation and warranty set forth in
Sections 2.03 and 2.04 hereof and Section 4 of the Assignment Agreement; and
(vi) in the case of the adjustable rate Mortgage Loans, (w) have a Mortgage Rate
that adjusts with the same frequency and based upon the same Index as that of
the Deleted Mortgage Loan, (x) have a Note Margin not less than that of the
Deleted Mortgage Loan; (y) have a Periodic Rate Cap that is equal to that of the
Deleted Mortgage Loan; and (z) have a next Adjustment Date no later than that of
the Deleted Mortgage Loan.

         RATING AGENCY: Standard & Poor's and Moody's. If any agency or a
successor is no longer in existence, "Rating Agency" shall be such statistical
credit rating agency, or other comparable Person, designated by the Depositor
and with respect to the Class A Certificates, the Insurer, notice of which
designation shall be given to the Trustee and the Master Servicer.

         REALIZED LOSS: With respect to each Mortgage Loan (or REO Property) as
to which a Cash Liquidation or REO Disposition has occurred, an amount (not less
than zero) equal to (i) the Stated Principal Balance of the Mortgage Loan (or
REO Property) as of the date of Cash Liquidation or REO Disposition, plus (ii)
interest (and REO Imputed Interest, if any) at the Net Mortgage Rate and the
Certificate Insurer Premium Modified Rate from the Due Date as to which interest
was last paid or advanced to Certificateholders up to the last day of the month
in which the Cash Liquidation (or REO Disposition) occurred on the Stated
Principal Balance of such Mortgage Loan (or REO Property) outstanding during
each Due Period that such interest was not paid or advanced to the extent such
interest does not constitute Deferred Interest that has been added to the
principal balance of such Mortgage Loan, minus (iii) the proceeds, if any,
received during the month in which such Cash Liquidation (or REO Disposition)
occurred, to the extent applied as recoveries of interest at the Net Mortgage
Rate and the Certificate Insurer Premium Modified Rate and to principal of the
Mortgage Loan, net of the portion thereof reimbursable to the Master Servicer or
any Subservicer with respect to related Advances or expenses as to which the
Master Servicer or Subservicer is entitled to reimbursement thereunder but which
have not been previously reimbursed. With respect to each Mortgage Loan which is
the subject of a Servicing Modification, (a) the amount by which the interest
portion of a Monthly Payment or the principal balance of such Mortgage Loan was
reduced, and (b) any such amount with respect to a Monthly Payment that was or
would have been due in the month immediately following the month in which a
Principal Prepayment or the Purchase Price of such Mortgage Loan is received or
is deemed to have been received. With respect to each Mortgage Loan which has
become the subject of a Deficient Valuation, the difference between the

                                       42

<PAGE>

principal balance of the Mortgage Loan outstanding immediately prior to such
Deficient Valuation and the principal balance of the Mortgage Loan as reduced by
the Deficient Valuation. With respect to each Mortgage Loan which has become the
object of a Debt Service Reduction, the amount of such Debt Service Reduction.
Notwithstanding the above, neither a Deficient Valuation nor a Debt Service
Reduction shall be deemed a Realized Loss hereunder so long as the Master
Servicer has notified the Trustee and the Insurer in writing that the Master
Servicer is diligently pursuing any remedies that may exist in connection with
the representations and warranties made regarding the related Mortgage Loan and
either (A) the related Mortgage Loan is not in default with regard to payments
due thereunder or (B) delinquent payments of principal and interest under the
related Mortgage Loan and any premiums on any applicable primary hazard
insurance policy and any related escrow payments in respect of such Mortgage
Loan are being advanced on a current basis by the Master Servicer or a
Subservicer, in either case without giving effect to any Debt Service Reduction.

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

         REGULAR CERTIFICATES: The Class A Certificates and the Class SB
Certificates.

         REGULAR INTEREST: Any one of the regular interests in the Trust Fund.

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

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

         REMIC ADMINISTRATOR: Residential Funding Corporation. If Residential
Funding Corporation is found by a court of competent jurisdiction to no longer
be able to fulfill its obligations as REMIC Administrator under this Agreement
the Master Servicer or Trustee acting as Master Servicer shall appoint a
successor REMIC Administrator, acceptable to the Insurer, subject to assumption
of the REMIC Administrator obligations under this Agreement.

         REMIC I: The segregated pool of assets subject hereto (exclusive of the
Reserve Fund, which is not an asset of any REMIC), constituting a portion of the
primary trust created hereby and to be administered hereunder, with respect to
which a separate REMIC election is to be made (other than with respect to the
items in clause (v) and the proceeds thereof), consisting of:(i) the Group I
Loans (exclusive of any Arrearages) and the related Mortgage Files; (ii) all
payments on and collections in respect of the Group I Loans due after the
Cut-off Date (other than Monthly Payments due in October 2001) as shall be on
deposit in the Custodial Account or in the Certificate Account and identified as
belonging to the Trust Fund, other than any payments in respect of any
Arrearages; (iii) property which secured a Group I Loan and which has been
acquired for the benefit of the Certificateholders by foreclosure or deed in
lieu of foreclosure; (iv) the hazard insurance policies and Primary Insurance
Policy pertaining to the Group I Loans, if any; (v) the Policy; and (vi) all
proceeds of clauses (i) through (v) above.

         REMIC I REGULAR INTERESTS: REMIC I Regular Interest LT-A-1, REMIC I
Regular Interest LT- A-2 and REMIC I Regular Interest I-LTC.

                                       43

<PAGE>

         REMIC I REGULAR INTEREST LT-A-1: A regular interest in REMIC I that is
held as an asset of REMIC III, that has an initial principal balance equal to
the related Uncertificated Principal Balance, that bears interest at the related
Uncertificated REMIC I Pass-Through Rate, and that has such other terms as are
described herein.

         REMIC I REGULAR INTEREST LT-A-2: A regular interest in REMIC I that is
held as an asset of REMIC III, that has an initial principal balance equal to
the related Uncertificated Principal Balance, that bears interest at the related
Uncertificated REMIC I Pass-Through Rate, and that has such other terms as are
described herein.

         REMIC I REGULAR INTEREST LT-A-3: A regular interest in REMIC I that is
held as an asset of REMIC III, that has an initial principal balance equal to
the related Uncertificated Principal Balance, that bears interest at the related
Uncertificated REMIC I Pass-Through Rate, and that has such other terms as are
described herein.

         REMIC II: The segregated pool of assets subject hereto (exclusive of
the Reserve Fund, which is not an asset of any REMIC), constituting a portion of
the primary trust created hereby and to be administered hereunder, with respect
to which a separate REMIC election is to be made (other than with respect to the
items in clause (v) and the proceeds thereof), consisting of:(i) the Group II
Loans (exclusive of any Arrearages) and the related Mortgage Files; (ii) all
payments on and collections in respect of the Group II Loans due after the
Cut-off Date (other than Monthly Payments due in October 2001) as shall be on
deposit in the Custodial Account or in the Certificate Account and identified as
belonging to the Trust Fund, other than any payments in respect of any
Arrearages; (iii) property which secured a Group II Loan and which has been
acquired for the benefit of the Certificateholders by foreclosure or deed in
lieu of foreclosure; (iv) the hazard insurance policies and Primary Insurance
Policy pertaining to the Group II Loans, if any; (v) the Policy; and (vi) all
proceeds of clauses (i) through (v) above.

         REMIC II REGULAR INTEREST: REMIC II Regular Interest LT-B.

         REMIC II REGULAR INTEREST LT-B: A regular interest in REMIC II that is
held as an asset of REMIC III, that has an initial principal balance equal to
the related Uncertificated Principal Balance, that bears interest at the related
Uncertificated REMIC II Pass-Through Rate, and that has such other terms as are
described herein.

         REMIC III: The segregated pool of assets subject hereto, constituting a
portion of the primary trust created hereby and to be administered hereunder,
with respect to which a separate REMIC election is to be made, consisting of the
REMIC I Regular Interests and the REMIC II Regular Interests.

         REMIC III GROUP I DIVERTED EXCESS SPREAD: 1% of the Group I Diverted
Excess Spread.

         REMIC III GROUP II DIVERTED EXCESS SPREAD: 1% of the Group II Diverted
Excess Spread.

         REMIC III GROUP I INTEREST LOSS ALLOCATION AMOUNT: With respect to any
Distribution Date, an amount equal to (a) the product of (i) the aggregate
Uncertificated Principal Balance of the

                                       44

<PAGE>

REMIC III Group I Regular Interests then outstanding and (ii) the Uncertificated
Pass-Through Rate for REMIC III Regular Interest LT1-I minus the related Marker
Rate, divided by (b) 12.

         REMIC III GROUP II INTEREST LOSS ALLOCATION AMOUNT: With respect to any
Distribution Date, an amount equal to (a) the product of (i) the aggregate
Uncertificated Principal Balance of the REMIC III Group II Regular Interests
then outstanding and (ii) the Uncertificated Pass-Through Rate for REMIC III
Regular Interest MT-II-1 minus the related Marker Rate divided by (b) 12.

         REMIC III GROUP I OVERCOLLATERALIZED AMOUNT: With respect to any date
of determination, (i) 1% of the aggregate Uncertificated Principal Balances of
the REMIC III Group I Regular Interests (other than REMIC III Regular Interest
MT-I-IO) minus (ii) the Uncertificated Principal Balances of REMIC III Regular
Interest MT-I-2, MT-I-3, MT-I-4 and MT-I-5, in each case as of such date of
determination.

         REMIC III GROUP II OVERCOLLATERALIZED AMOUNT: With respect to any date
of determination, (i) 1% of the aggregate Uncertificated Principal Balances of
the REMIC III Group II Regular Interests minus (ii) the Uncertificated Principal
Balance of REMIC III Regular Interest MT-II-2 as of such date of determination.

         REMIC III GROUP I PRINCIPAL LOSS ALLOCATION AMOUNT: With respect to any
Distribution Date, an amount equal to the product of (i) the aggregate Stated
Principal Balance of the Group I Loans then outstanding and (ii) 1 minus a
fraction, the numerator of which is two times the sum of the Uncertificated
Principal Balances of REMIC III Regular Interests MT-I-2, MT-I-3, MT-I-4, MT-I-5
and MT-I-6 and the denominator of which is the sum of the Uncertificated
Principal Balances of REMIC III Regular Interests MT-I-2, MT-I-3, MT-I-4,
MT-I-5, MT-I-6 and MT-I-7.

         REMIC III GROUP II PRINCIPAL LOSS ALLOCATION AMOUNT: With respect to
any Distribution Date, an amount equal to the product of (i) the aggregate
Stated Principal Balance of the Group II Loans then outstanding and (ii) 1 minus
a fraction, the numerator of which is two times the Uncertificated Principal
Balance of REMIC III Regular Interest MT-II-2 and the denominator of which is
the sum of the Uncertificated Principal Balances of REMIC III Regular Interests
MT-II-2 and MT-II-3.

         REMIC III GROUP I REGULAR INTERESTS: REMIC III Regular Interest MT-I-1,
REMIC III Regular Interest MT-I-2, REMIC III Regular Interest MT-I-3, REMIC III
Regular Interest MT-I-4, REMIC III Regular Interest MT-I-5, REMIC III Regular
Interest MT-I-6, REMIC III Regular Interest MT-I-7 and REMIC III Regular
Interest MT-I-IO.

         REMIC III GROUP II REGULAR INTERESTS: REMIC III Regular Interest
MT-II-1, REMIC III Regular Interest MT-II-2 and REMIC III Regular Interest
MT-II-3.

         REMIC III GROUP I REQUIRED OVERCOLLATERALIZATION AMOUNT: 1% of the
Group I Required Overcollateralization Amount.

         REMIC III GROUP II REQUIRED OVERCOLLATERALIZED AMOUNT: 1% of the Group
II Required Overcollateralization Amount.

                                       45

<PAGE>

         REMIC III REGULAR INTEREST LT1-I: A regular interest in REMIC III that
is held as an asset of REMIC IV, that has an initial principal balance equal to
the related Uncertificated Principal Balance, that bears interest at the related
Uncertificated Pass-Through Rate, and that has such other terms as are described
herein.

         REMIC III REGULAR INTEREST MT-I-2: A regular interest in REMIC III that
is held as an asset of REMIC IV, that has an initial principal balance equal to
the related Uncertificated Principal Balance, that bears interest at the related
Uncertificated Pass-Through Rate, and that has such other terms as are described
herein.

         REMIC III REGULAR INTEREST MT-I-3: A regular interest in REMIC III that
is held as an asset of REMIC IV, that has an initial principal balance equal to
the related Uncertificated Principal Balance, that bears interest at the related
Uncertificated Pass-Through Rate, and that has such other terms as are described
herein.

         REMIC III REGULAR INTEREST MT-I-4: A regular interest in REMIC III that
is held as an asset of REMIC IV, that has an initial principal balance equal to
the related Uncertificated Principal Balance, that bears interest at the related
Uncertificated Pass-Through Rate, and that has such other terms as are described
herein.

         REMIC III REGULAR INTEREST MT-I-5: A regular interest in REMIC III that
is held as an asset of REMIC IV, that has an initial principal balance equal to
the related Uncertificated Principal Balance, that bears interest at the related
Uncertificated Pass-Through Rate, and that has such other terms as are described
herein.

         REMIC III REGULAR INTEREST MT-I-6: A regular interest in REMIC III that
is held as an asset of REMIC IV, that has an initial principal balance equal to
the related Uncertificated Principal Balance, that bears interest at the related
Uncertificated Pass-Through Rate, and that has such other terms as are described
herein.

         REMIC III REGULAR INTEREST MT-I-7: A regular interest in REMIC III that
is held as an asset of REMIC IV, that has an initial principal balance equal to
the related Uncertificated Principal Balance, that bears interest at the related
Uncertificated Pass-Through Rate, and that has such other terms as are described
herein.

         REMIC III REGULAR INTEREST MT-I-7 MAXIMUM INTEREST DEFERRAL AMOUNT:
With respect to any Distribution Date, the sum of (A) the excess of (i)
Uncertificated Accrued Interest calculated with the REMIC III Regular Interest
MT-I-6 Uncertificated Pass-Through Rate and an Uncertificated Principal Balance
equal to the excess of (x) the Uncertificated Principal Balance of REMIC III
Regular Interest MT-I-6 over (y) the REMIC III Group I Overcollateralized
Amount, in each case for such Distribution Date, over (ii) Uncertificated
Accrued Interest on REMIC III Regular Interest MT-I-2 with the rate on REMIC III
Regular Interest MT-I-2 subject to a cap equal to the least of (a) LIBOR plus
0.23% per annum, (b) the Maximum Class A-I-1 Rate and (c) the Group I Adjusted
Net WAC Rate for the purpose of this calculation; Uncertificated Accrued
Interest on REMIC III Regular Interest MT-I-3 with the rate on REMIC III Regular
Interest MT-I-3 subject to a cap equal to the lesser of (a) 4.60% per annum and
(b) the Group I Adjusted Net WAC Rate for the purpose of this

                                       46

<PAGE>

calculation; Uncertificated Accrued Interest on REMIC III Regular Interest
MT-I-4 with the rate on REMIC III Regular Interest MT-I-4 subject to a cap equal
to the lesser of (a) 5.50% per annum and (b) the Group I Adjusted Net WAC Rate
for the purpose of this calculation and Uncertificated Accrued Interest on REMIC
III Regular Interest MT-I-5 with the rate on REMIC III Regular Interest MT-I-5
subject to a cap equal to the lesser of (a) 6.29% per annum and (b) the Group I
Adjusted Net WAC Rate and (ii) on or after the first Distribution Date after the
first possible Group I Optional Termination Date, a per annum rate equal to the
lesser of (a) 6.79% per annum and (b) the Group I Adjusted Net WAC Rate for the
purpose of this calculation for such Distribution Date; Uncertificated Accrued
Interest on REMIC III Regular Interest MT-I-6 with the rate on REMIC III Regular
Interest MT-I-3 subject to a cap equal to the lesser of (a) 5.70% per annum and
(b) the Group I Adjusted Net WAC Rate for the purpose of this calculation and
(B) the REMIC III Group II Diverted Excess Spread.

         REMIC III REGULAR INTEREST MT-I-IO: A Regular Interest in REMIC III
that is held as an asset of REMIC IV, that has an initial notional balance equal
to the related Notional Balance, that bears interest at the related
Uncertificated Pass-Through Rate and in that has such other terms as are
described herein.

         REMIC III REGULAR INTEREST MT-II-1: A regular interest in REMIC III
that is held as an asset of REMIC IV, that has an initial principal balance
equal to the related Uncertificated Principal Balance, that bears interest at
the related Uncertificated Pass-Through Rate, and that has such other terms as
are described herein.

         REMIC III REGULAR INTEREST MT-II-2: A regular interest in REMIC III
that is held as an asset of REMIC IV, that has an initial principal balance
equal the related Uncertificated Principal Balance, that bears interest at the
related Uncertificated Pass-Through Rate, and that has such other terms as are
described herein.

         REMIC III REGULAR INTEREST MT-II-3: A regular interest in REMIC III
that is held as an asset of REMIC IV, that has an initial principal balance
equal to the related Uncertificated Principal Balance, that bears interest at
the related Uncertificated Pass-Through Rate, and that has such other terms as
are described herein.

         REMIC III REGULAR INTEREST MT-II-3 MAXIMUM INTEREST DEFERRAL AMOUNT:
With respect to any Distribution Date, the sum of (A) the excess of (i)
Uncertificated Accrued Interest calculated with the REMIC III Regular Interest
MT-II-3 Uncertificated Pass-Through Rate and an Uncertificated Principal Balance
equal to the excess of (x) the Uncertificated Principal Balance of REMIC III
Regular Interest MT-II-3 over (y) the REMIC III Group II Overcollateralized
Amount, in each case for such Distribution Date, over (ii) Uncertificated
Accrued Interest on REMIC III Regular Interest MT-II-2 with the rate on REMIC
III Regular Interest MT-I-2 subject to a cap equal to the least of (a) LIBOR
plus the Class A-II Margin, (b) the Maximum Class A-II Rate and (c) the Group II
Weighted Average Actual/360 Net Mortgage Rate for the purpose of this
calculation for such Distribution Date and (B) the REMIC III Group I Diverted
Excess Spread.

                                       47

<PAGE>

         REMIC IV: The segregated pool of assets subject hereto, constituting a
portion of the primary trust created hereby and to be administered hereunder,
with respect to which a separate REMIC election is to be made, consisting of the
REMIC III Regular Interests.

         REMIC PROVISIONS: Provisions of the federal income tax law relating to
real estate mortgage investment conduits, which appear at Sections 860A through
860G of Subchapter M of Chapter 1 of the Code, and related provisions, and
temporary and final regulations (or, to the extent not inconsistent with such
temporary or final regulations, proposed regulations) and published rulings,
notices and announcements promulgated thereunder, as the foregoing may be in
effect from time to time.

         REO ACQUISITION: The acquisition by the Master Servicer on behalf of
the Trustee for the benefit of the Certificateholders of any REO Property
pursuant to Section 3.14.

         REO DISPOSITION: As to any REO Property, a determination by the Master
Servicer that it has received substantially all Insurance Proceeds, Liquidation
Proceeds, REO Proceeds and other payments and recoveries (including proceeds of
a final sale) which the Master Servicer expects to be finally recoverable from
the sale or other disposition of the REO Property.

         REO IMPUTED INTEREST: As to any REO Property, for any period, an amount
equivalent to interest (at a rate equal to the sum of the Net Mortgage Rate and
the Certificate Insurer Premium Modified Rate that would have been applicable to
the related Mortgage Loan had it been outstanding net of amounts that would have
been Deferred Interest, if any) on the unpaid principal balance of the Mortgage
Loan as of the date of acquisition thereof for such period.

         REO PROCEEDS: Proceeds, net of expenses, received in respect of any REO
Property (including, without limitation, proceeds from the rental of the related
Mortgaged Property or, with respect to a Cooperative Loan, the related
Cooperative Apartment) which proceeds are required to be deposited into the
Custodial Account only upon the related REO Disposition.

         REO PROPERTY: A Mortgaged Property acquired by the Master Servicer
through foreclosure or deed in lieu of foreclosure in connection with a
defaulted Mortgage Loan.

         RE-PERFORMING LOANS: The Mortgage Loans listed on Exhibit R which were
contractually delinquent as of the Cut-off Date, but for which the related
Mortgagor had entered into a bankruptcy plan or repayment plan.

         REPURCHASE EVENT: As defined in the Assignment Agreement.

         REPURCHASE PRICE: With respect to any Deleted Mortgage Loan to be
replaced by the substitution of one or more Qualified Substitute Mortgage Loans
pursuant to Section 2.03, an amount, calculated by the Master Servicer equal
to:(a) the unpaid principal balance of such Mortgage Loan (or, in the case of
any REO Property, the related Mortgage Loan) (after application of all principal
payments (including prepayments) collected and other principal amounts recovered
on such Mortgage Loan) as of the date of receipt of the Repurchase Price or the
date of substitution, as the case may be, hereunder; plus(b) unpaid interest
accrued on such Mortgage Loan or Mortgage Loan

                                       48

<PAGE>

related to an REO Property, as applicable, at the related Mortgage Rate (after
application of all interest payments collected and other amounts recovered (and
applied to accrued interest) on such Mortgage Loan) to, but not including, the
Due Date in the Due Period during which the applicable purchase or substitution
occurs; plus(c) any unreimbursed Servicing Advances, all accrued and unpaid
interest on Advances, any unpaid servicing compensation (other than Master
Servicer fees), and any unpaid or unreimbursed expenses of the Trust Fund
allocable to such Mortgage Loan or Mortgage Loan related to an REO Property, as
applicable, as of the date of receipt of such Repurchase Price or the date of
substitution, as the case may be, hereunder; plus(d) in the event that such
Mortgage Loan or Mortgage Loan related to an REO Property, as applicable, is
required to be repurchased or replaced pursuant to Section 2.03, expenses
reasonably incurred or to be incurred by the Master Servicer or the Trustee in
respect of the breach or defect giving rise to the repurchase or replacement
obligation, including any expenses arising out of the enforcement of the
repurchase or replacement obligation.

         REQUEST FOR RELEASE: A request for release, the forms of which are
attached as Exhibit G hereto, or an electronic request in a form acceptable to
the Custodian.

         REQUIRED INSURANCE POLICY: With respect to any Mortgage Loan, any
insurance policy which is required to be maintained from time to time under this
Agreement, the Program Guide or the related Subservicing Agreement in respect of
such Mortgage Loan.

         RESERVE FUND: An "outside reserve fund" within the meaning of Treasury
regulation Section 1.860G-2(h), which is not an asset of any REMIC, ownership of
which is evidenced by the Class SB- II Certificates, and which is established
and maintained pursuant to Section 4.09.

         RESERVE FUND DEPOSIT: With respect to the Reserve Fund, an amount equal
to $5,000, which the Trustee shall deposit into the Trust Fund pursuant to
Section 4.09 hereof.

         RESERVE FUND RESIDUAL RIGHT: The right to distributions from the
Reserve Fund as described in Section 4.09 hereof.

         RESIDENTIAL FUNDING: Residential Funding Corporation, a Delaware
corporation, in its capacity as seller of the Mortgage Loans to the Depositor
and any successor thereto.

         RESPONSIBLE OFFICER: When used with respect to the Trustee, any officer
of the Corporate Trust Department of the Trustee, including any Senior Vice
President, any Vice President, any Assistant Vice President, any Assistant
Secretary, any Trust Officer or Assistant Trust Officer, or any other officer of
the Trustee customarily performing functions similar to those performed by any
of the above designated officers to whom, with respect to a particular matter,
such matter is referred.

         ROLLING SIX-MONTH DELINQUENCY RATIO: As of any Distribution Date, the
fraction, expressed as a percentage, equal to the average of the Delinquency
Ratio for each of the six (or one, two, three, four and five in the case of the
first, second, third, fourth and fifth Distribution Dates) immediately preceding
Due Periods.

                                       49

<PAGE>

         SECURITY AGREEMENT: With respect to a Cooperative Loan, the agreement
creating a security interest in favor of the originator in the related
Cooperative Stock.

         SERVICER BAILEE LOAN: A Mortgage Loan, as indicated on Exhibit S, for
which the Mortgage File is held on the Cut-off Date by the related servicer or
the servicer's attorney.

         SERVICING ACCOUNTS: The account or accounts created and maintained
pursuant to Section 3.08.

         SERVICING ADVANCES: All customary, reasonable and necessary "out of
pocket" costs and expenses incurred in connection with a default, delinquency or
other unanticipated event by the Master Servicer in the performance of its
servicing obligations, including, but not limited to, the cost of (i) the
preservation, restoration and protection of a Mortgaged Property or, with
respect to a Cooperative Loan, the related Cooperative Apartment, (ii) any
enforcement or judicial proceedings, including foreclosures, including any
expenses incurred in relation to any such proceedings that result from the
Mortgage Loan being registered on the MERS System, (iii) the management and
liquidation of any REO Property and (iv) compliance with the obligations under
Sections 3.01, 3.08, 3.12(a) and 3.14, including, if the Master Servicer or any
Affiliate of the Master Servicer provides services such as appraisals and
brokerage services that are customarily provided by Persons other than servicers
of mortgage loans, reasonable compensation for such services.

         SERVICING FEE: With respect to any Mortgage Loan and Distribution Date,
the fee payable monthly to the Master Servicer in respect of master servicing
compensation that accrues at an annual rate equal to the Servicing Fee Rate
multiplied by the Stated Principal Balance of such Mortgage Loan as of the
related Due Date in the related Due Period, as may be adjusted pursuant to
Section 3.16(e).

         SERVICING FEE RATE: The per annum rate designated on the Mortgage Loan
Schedule as the "MSTR SERV FEE," as may be adjusted with respect to successor
Master Servicers as provided in Section 7.02.

         SERVICING MODIFICATION: Any reduction of the interest rate on or the
outstanding principal balance of a Mortgage Loan that is in default or, in the
judgment of the Master Servicer, default is reasonably foreseeable pursuant to a
modification of such Mortgage Loan in accordance with Section 3.07(a).

         SERVICING OFFICER: Any officer of the Master Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans whose
name and specimen signature appear on a list of servicing officers furnished to
the Trustee and the Insurer by the Master Servicer, as such list may from time
to time be amended.

         SERVICING TRIGGER: As of any Distribution Date, for purposes of Section
7.05, "Servicing Trigger; Removal of Master Servicer," the occurrence of any of
the following scenarios:

                  (i) the aggregate Rolling Six-Month Delinquency Ratio is
         greater than 12.00% for the then-current Distribution Date;

                                       50

<PAGE>

         (ii) the aggregate Rolling Six-Month Delinquency Ratio is greater than
         10.00% for the then-current and two preceding Distribution Dates;

         (iii) the aggregate Twelve-Month Loss Amount is greater than or equal
         to 2.75% of the aggregate Stated Principal Balance of the Mortgage
         Loans; or

         (iv) the aggregate Realized Losses on the Mortgage Loans since the
         Cut-off Date exceed (a) with respect to the first 12 Distribution
         Dates, 2.25% of the aggregate Cut-off Date Principal Balance of the
         Mortgage Loans, (b) with respect to the next 12 Distribution Dates,
         3.75% of the aggregate Cut-off Date Principal Balance of the Mortgage
         Loans, (c) with respect to the next 12 Distribution Dates, 5.25% of the
         aggregate Cut-off Date Principal Balance of the Mortgage Loans, (d)
         with respect to the next 12 Distribution Dates, 6.75% of the aggregate
         Cut-off Date Principal Balance of the Mortgage Loans, and (e) with
         respect to all Distribution Dates thereafter, 8.00% of the aggregate
         Cut-off Date Principal Balance of the Mortgage Loans.

         SIMPLE INTEREST LOAN: A Mortgage Loan pursuant to which each Monthly
Payment is applied FIRST, to interest accrued on such Mortgage Loan from the
date on which the previous Monthly Payment was made to the date on which such
Monthly Payment was made, and SECOND to the principal amount outstanding.

         SPECIAL HAZARD LOSS: Any Realized Loss not in excess of the lesser of
the cost of repair or the cost of replacement of a Mortgaged Property (or, with
respect to a Cooperative Loan, the related Cooperative Apartment) suffered by
such Mortgaged Property (or Cooperative Apartment) on account of direct physical
loss, exclusive of (i) any loss of a type covered by a hazard policy or a flood
insurance policy required to be maintained in respect of such Mortgaged Property
pursuant to Section 3.12(a), except to the extent of the portion of such loss
not covered as a result of any coinsurance provision and (ii) any Extraordinary
Loss.

         STANDARD & POOR'S: Standard & Poor's, a division of The McGraw-Hill
Companies, or its successor in interest.

         STARTUP DATE: The day designated as such pursuant to Article X hereof.

         STATED PRINCIPAL BALANCE: With respect to any Mortgage Loan or related
REO Property, at any given time, (i) the Cut-off Date Principal Balance of the
Mortgage Loan, plus (ii) any Deferred Interest added to the principal balance of
the Mortgage Loan pursuant to the terms of the Mortgage Note, minus (iii) the
sum of (a) the principal portion of the Monthly Payments due with respect to
such Mortgage Loan or REO Property during each Due Period ending prior to the
most recent Distribution Date which were received or with respect to which an
Advance was made, and (b) all Principal Prepayments with respect to such
Mortgage Loan or REO Property, and all Insurance Proceeds, Liquidation Proceeds
and REO Proceeds, to the extent applied by the Master Servicer as recoveries of
principal in accordance with Section 3.14 with respect to such Mortgage Loan or
REO Property, in each case which were distributed pursuant to Section 4.02 or
4.03 on any previous Distribution Date, and (c) any Realized Loss allocated to
Certificateholders with respect thereto for any previous Distribution Date.

                                       51

<PAGE>

         SUBORDINATION: The provisions described in Section 4.05 relating to the
allocation of Realized Losses (other than any Realized Losses covered by the
Policy).

         SUBSERVICED MORTGAGE LOAN: Any Mortgage Loan that, at the time of
reference thereto, is subject to a Subservicing Agreement.

         SUBSERVICER: Any Person with whom the Master Servicer has entered into
a Subservicing Agreement and who generally satisfied the requirements set forth
in the Program Guide in respect of the qualification of a Subservicer as of the
date of its approval as a Subservicer by the Master Servicer.

         SUBSERVICER ADVANCE: Any delinquent installment of principal and
interest on a Mortgage Loan which is advanced by the related Subservicer (net of
its Subservicing Fee) pursuant to the Subservicing Agreement.

         SUBSERVICING ACCOUNT: An account established by a Subservicer in
accordance with Section 3.08.

         SUBSERVICING AGREEMENT: The written contract between the Master
Servicer and any Subservicer relating to servicing and administration of certain
Mortgage Loans as provided in Section 3.02, generally in the form of the
servicer contract referred to or contained in the Program Guide or in such other
form as has been approved by the Master Servicer and the Depositor.

         SUBSERVICING FEE: As to any Mortgage Loan, the fee payable monthly to
the related Subservicer (or, in the case of a Nonsubserviced Mortgage Loan, to
the Master Servicer) in respect of subservicing and other compensation that
accrues with respect to each Distribution Date at an annual rate designated as
"SUBSERV FEE" in Exhibit F-1 and Exhibit F-2.

         TAX RETURNS: The federal income tax return on Internal Revenue Service
Form 1066, U.S. Real Estate Mortgage Investment Conduit Income Tax Return,
including Schedule Q thereto, Quarterly Notice to Residual Interest Holders of
REMIC Taxable Income or Net Loss Allocation, or any successor forms, to be filed
on behalf of REMIC I, REMIC II, REMIC III and REMIC IV due to their
classification as REMICs under the REMIC Provisions, together with any and all
other information, reports or returns that may be required to be furnished to
the Certificateholders or filed with the Internal Revenue Service or any other
governmental taxing authority under any applicable provisions of federal, state
or local tax laws.

         TRANSFER: Any direct or indirect transfer, sale, pledge, hypothecation
or other form of assignment of any Ownership Interest in a Certificate.

         TRANSFEREE: Any Person who is acquiring by Transfer any Ownership
Interest in a Certificate.

         TRANSFEROR: Any Person who is disposing by Transfer of any Ownership
Interest in a Certificate.

                                       52

<PAGE>

         TRUST FUND: Collectively, the assets of REMIC I, REMIC II, REMIC III
and REMIC IV, the Reserve Fund and the Reserve Fund Deposit.

         TWELVE-MONTH LOSS AMOUNT: With respect to any Distribution Date, an
amount equal to the aggregate of all Realized Losses on the Mortgage Loans
during the 12 preceding Due Periods.

         UNIFORM SINGLE ATTESTATION PROGRAM FOR MORTGAGE BANKERS: The Uniform
Single Attestation Program for Mortgage Bankers, as published by the Mortgage
Bankers Association of America and effective with respect to fiscal periods
ending on or after December 15, 1995.

         UNCERTIFICATED ACCRUED INTEREST: With respect to any Uncertificated
Regular Interest for any Distribution Date, one month's interest at the related
Uncertificated Pass-Through Rate for such Distribution Date, accrued on the
Uncertificated Principal Balance or Uncertificated Notional Amount, as
applicable, immediately prior to such Distribution Date. Uncertificated Accrued
Interest for the Group I Uncertificated Regular Interests shall accrue on the
basis of a 360-day year consisting of twelve 30-day months. Uncertificated
Accrued Interest for the Group II Uncertificated Regular Interests shall accrue
on the basis of a 360-day year and the actual number of days in the related
Accrual Period. For purposes of calculating the amount of Uncertificated Accrued
Interest for the REMIC I Regular Interests for any Distribution Date, any
Prepayment Interest Shortfalls (to the extent not covered by Compensating
Interest) relating to the Group I Loans for any Distribution Date shall be
allocated first to REMIC I Regular Interest LT-A-1, then to REMIC I Regular
Interest LT-A- 2 and then to REMIC I Regular Interest LT-A-3, in each case to
the extent of one month's interest at the then applicable respective
Uncertificated REMIC I Pass-Through Rate on the respective Uncertificated
Principal Balance of each such Uncertificated REMIC I Regular Interest. For
purposes of calculating the amount of Uncertificated Accrued Interest for the
REMIC II Regular Interest for any Distribution Date, any Prepayment Interest
Shortfalls (to the extent not covered by Compensating Interest) relating to the
Group II Loans for any Distribution Date shall be allocated to REMIC II Regular
Interest LT-B, to the extent of one month's interest at the then applicable
respective Uncertificated REMIC II Pass-Through Rate on the respective
Uncertificated Principal Balance of such Uncertificated REMIC II Regular
Interest. For purposes of calculating the amount of Uncertificated Accrued
Interest for the REMIC III Group I Regular Interests for any Distribution Date,
any Prepayment Interest Shortfalls (to the extent not covered by Compensating
Interest) relating to the Group I Loans for any Distribution Date shall be
allocated first, to Uncertificated Accrued Interest payable to REMIC III Regular
Interest LT1-I and REMIC III Regular Interest MT-I- 6 up to an aggregate amount
equal to the REMIC III Group I Interest Loss Allocation Amount, 98% and 2%,
respectively, and thereafter any remaining Prepayment Interest Shortfalls (to
the extent not covered by Compensating Interest) relating to the Group I Loans
for any Distribution Date shall be allocated among REMIC III Regular Interests
MT-I-1, MT-I-2, MT-I-3, MT-I-4, MT-I-5, MT-I-6, MT-I-7 and MT-I-IO, pro rata
based on, and to the extent of, Uncertificated Accrued Interest, as calculated
without application of this sentence. For purposes of calculating the amount of
Uncertificated Accrued Interest for the REMIC III Group II Regular Interests for
any Distribution Date, any Prepayment Interest Shortfalls (to the extent not
covered by Compensating Interest) relating to the Group II Loans for any
Distribution Date shall be allocated first, to Uncertificated Accrued Interest
payable to REMIC III Regular Interest MT-II-1 and REMIC III Regular Interest
MT-II-3 up to an aggregate amount equal to the REMIC III Group II Interest Loss
Allocation Amount, 98% and 2%, respectively, and thereafter any remaining
Prepayment Interest Shortfalls (to

                                       53

<PAGE>

the extent not covered by Compensating Interest) relating to the Group II Loans
for any Distribution Date shall be allocated among REMIC III Regular Interests
MT-II-1, MT-II-2, and MT-II-3, pro rata based on, and to the extent of,
Uncertificated Accrued Interest, as calculated without application of this
sentence.

         UNCERTIFICATED NOTIONAL AMOUNT: With respect to REMIC III Regular
Interest MT-I-IO and (i) any date of determination after October, 2001 and on or
before February, 2001, the aggregate Uncertificated Principal Balances of REMIC
I Regular Interest LT-A-2 and REMIC I Regular Interest LT-A-3 for such
Distribution Date, or (ii) any date of determination after January, 2001, and on
or before April, 2004, the Uncertificated Principal Balance of REMIC I Regular
Interest LT-A-3 for such Distribution Date.

         UNCERTIFICATED PASS-THROUGH RATE: The Uncertificated REMIC I
Pass-Through Rate, Uncertificated REMIC II Pass-Through Rate or Uncertificated
REMIC III Pass-Through Rate.

         UNCERTIFICATED PRINCIPAL BALANCE: The principal amount of any
Uncertificated Regular Interest (other than REMIC III Regular Interest MT-I-IO)
outstanding as of any date of determination. The Uncertificated Principal
Balance of each Uncertificated Regular Interest shall be reduced by all
distributions of principal made on such Uncertificated Regular Interest, as
applicable, on such Distribution Date and, if and to the extent necessary and
appropriate, shall be further reduced in such Distribution Date by Realized
Losses. The Uncertificated Principal Balance of each Uncertificated Regular
Interest shall never be less than zero. REMIC III Regular Interest MT-I-IO will
not have an Uncertificated Principal Balance.

         UNCERTIFICATED REGULAR INTERESTS: The REMIC I Regular Interests, the
REMIC II Regular Interests and the REMIC III Regular Interests.

         UNCERTIFICATED REMIC I PASS-THROUGH RATE: With respect to any
Distribution Date, a per annum rate equal to the Group I Weighted Average Net
Mortgage Rate.

         UNCERTIFICATED REMIC II PASS-THROUGH RATE: With respect to any
Distribution Date, a per annum rate equal to the Group II Weighted Average Net
Mortgage Rate.

         UNCERTIFICATED REMIC III PASS-THROUGH RATE:

         (a) With respect to REMIC III Regular Interest MT-I-1, REMIC III
Regular Interest MT- I-2, REMIC III Regular Interest MT-I-3, REMIC III Regular
Interest MT-I-4, REMIC III Regular Interest MT-I-5, REMIC III Regular Interest
MT-I-6 and REMIC III Regular Interest MT-I-7, and any Distribution Date, a per
annum rate equal to the Group I Adjusted Net WAC Rate.

         (b) With respect to REMIC III Regular Interest MT-I-IO and the first 30
Distribution Dates, 6.00%, and with respect to REMIC III Regular Interest
MT-I-IO and any Distribution Date thereafter, 0.00% per annum.

                                       54

<PAGE>

         (c) With respect to REMIC III Regular Interest MT-II-1, REMIC III
Regular Interest MT- II-2, and REMIC III Regular Interest MT-II-3, and any
Distribution Date, a per annum rate equal to the Uncertificated REMIC II
Pass-Through Rate.

         UNINSURED CAUSE: Any cause of damage to property subject to a Mortgage
such that the complete restoration of such property is not fully reimbursable by
the hazard insurance policies.

         UNITED STATES PERSON: A citizen or resident of the United States, a
corporation, partnership or other entity (treated as a corporation or
partnership for United States federal income tax purposes) created or organized
in, or under the laws of, the United States, any state thereof, or the District
of Columbia (except in the case of a partnership, to the extent provided in
Treasury regulations) provided that, for purposes solely of the restrictions on
the transfer of Class R Certificates, no partnership or other entity treated as
a partnership for United States federal income tax purposes shall be treated as
a United States Person unless all persons that own an interest in such
partnership either directly or through any entity that is not a corporation for
United States federal income tax purposes are required by the applicable
operative agreement to be United States Persons, or an estate that is described
in Section 7701(a)(30)(D) of the Code, or a trust that is described in Section
7701(a)(30)(E) of the Code.

         VA: The Veterans Administration, or its successor.

         VOTING RIGHTS: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. 96.00% of all of the Voting
Rights shall be allocated among Holders of the Class A Certificates, other than
the Class A-I-IO Certificates, in proportion to the outstanding Certificate
Principal Balances of their respective Certificates; 1% of all of the Voting
Rights shall be allocated among Holders of the Class A-I-IO Certificates; 1% and
1% of all of the Voting Rights shall be allocated among the Holders of the Class
SB-I and Class SB-II Certificates, respectively; 0.25%, 0.25%, 0.25% and 0.25%
of all of the Voting Rights shall be allocated among the Holders of the Class
R-I, Class R-II, Class R-III and Class R-IV Certificates, respectively; in each
case to be allocated among the Certificates of such Class in accordance with
their respective Percentage Interest.

         Section 1.02.     DETERMINATION OF LIBOR.

         LIBOR applicable to the calculation of the Pass-Through Rate on the
Class A-I-1 Certificates and Class A-II Certificates for any Interest Accrual
Period will be determined on each LIBOR Rate Adjustment Date. On each LIBOR Rate
Adjustment Date, LIBOR shall be established by the Trustee and, as to any
Interest Accrual Period, will equal the rate for one month United States dollar
deposits that appears on the Telerate Screen Page 3750 as of 11:00 a.m., London
time, on such LIBOR Rate Adjustment Date. "Telerate Screen Page 3750" means the
display designated as page 3750 on the Telerate Service (or such other page as
may replace page 3750 on that service for the purpose of displaying London
interbank offered rates of major banks). If such rate does not appear on such
page (or such other page as may replace that page on that service, or if such
service is no longer offered, LIBOR shall be so established by use of such other
service for displaying LIBOR or comparable rates as may be selected by the
Trustee after consultation with the Master Servicer and the Insurer), the rate
will be the Reference Bank Rate. The "Reference Bank Rate" will be

                                       55

<PAGE>

determined on the basis of the rates at which deposits in U.S. Dollars are
offered by the reference banks (which shall be any three major banks that are
engaged in transactions in the London interbank market, selected by the Trustee
after consultation with the Master Servicer and the Insurer) as of 11:00 a.m.,
London time, on the LIBOR Rate Adjustment Date to prime banks in the London
interbank market for a period of one month in amounts approximately equal to the
aggregate Certificate Principal Balance of the Class A-I-1 Certificates and
Class A-II Certificates then outstanding. The Trustee will request the principal
London office of each of the reference banks to provide a quotation of its rate.
If at least two such quotations are provided, the rate will be the arithmetic
mean of the quotations rounded up to the next multiple of 1/16%. If on such date
fewer than two quotations are provided as requested, the rate will be the
arithmetic mean of the rates quoted by one or more major banks in New York City,
selected by the Trustee after consultation with the Master Servicer and the
Insurer, as of 11:00 a.m., New York City time, on such date for loans in U.S.
Dollars to leading European banks for a period of one month in amounts
approximately equal to the aggregate Certificate Principal Balance of the Class
A-I-1 Certificates and Class A-II Certificates then outstanding. If no such
quotations can be obtained, the rate will be LIBOR for the prior Distribution
Date; PROVIDED HOWEVER, if, under the priorities described above, LIBOR for a
Distribution Date would be based on LIBOR for the previous Distribution Date for
the third consecutive Distribution Date, the Trustee, after consultation with
the Insurer, shall select an alternative comparable index (over which the
Trustee has no control), used for determining one- month Eurodollar lending
rates that is calculated and published (or otherwise made available) by an
independent party. The establishment of LIBOR by the Trustee on any LIBOR Rate
Adjustment Date and the Trustee's subsequent calculation of the Pass-Through
Rate applicable to the Class A-I-1 Certificates and Class A-II Certificates for
the relevant Interest Accrual Period, in the absence of manifest error, will be
final and binding. Promptly following each LIBOR Rate Adjustment Date the
Trustee shall supply the Master Servicer with the results of its determination
of LIBOR on such date. Furthermore, the Trustee will supply to any
Certificateholder so requesting by telephone the Pass-Through Rate on the Class
A-I-1 Certificates and Class A-II Certificates for the current and the
immediately preceding Interest Accrual Period.

                                       56

<PAGE>

                                   ARTICLE II

                          CONVEYANCE OF MORTGAGE LOANS;
                        ORIGINAL ISSUANCE OF CERTIFICATES

         Section 2.01.     CONVEYANCE OF MORTGAGE LOANS.

         (a) The Depositor, concurrently with the execution and delivery hereof,
does hereby assign to the Trustee without recourse all the right, title and
interest of the Depositor in and to (i) the Mortgage Loans, including all
interest and principal received on or with respect to the Mortgage Loans after
the Cut-off Date (other than payments of principal and interest due on the
Mortgage Loans in the month of October 2001), but excluding any Arrearages and
any payments in respect thereof; (ii) the Reserve Fund Deposit; and (iii) all
proceeds of the foregoing.

         (b) In connection with such assignment, and contemporaneously with the
delivery of this Agreement, the Depositor delivered or caused to be delivered
hereunder to the Trustee the Policy, and except as set forth in Section 2.01(c)
below, the Depositor does hereby deliver to, and deposit with, the Trustee, or
to and with one or more Custodians, as the duly appointed agent or agents of the
Trustee for such purpose, the following documents or instruments (or copies
thereof as permitted by this Section) (I) with respect to each Mortgage Loan so
assigned (other than a Cooperative Loan):

                  (i) The original Mortgage Note, endorsed without recourse to
         the order of the Trustee and showing an unbroken chain of endorsements
         from the originator thereof to the Person endorsing it to the Trustee,
         or with respect to any Destroyed Mortgage Note, an original lost note
         affidavit from the related Seller or Residential Funding stating that
         the original Mortgage Note was lost, misplaced or destroyed, together
         with a copy of the related Mortgage Note;

                  (ii) The original Mortgage, noting the presence of the MIN of
         the Mortgage Loan and language indicating that the Mortgage Loan is a
         MOM Loan if the Mortgage Loan is a MOM Loan, with evidence of recording
         thereon or, if the original Mortgage has not yet been returned from the
         public recording office, a copy of the original Mortgage with evidence
         of recording indicated thereon;

                  (iii) Unless the Mortgage Loan is registered on the MERS(R)
         System, the assignment (which may be included in one or more blanket
         assignments if permitted by applicable law) of the Mortgage to the
         Trustee with evidence of recording indicated thereon or a copy of such
         assignment with evidence of recording indicated thereon;

                  (iv) The original recorded assignment or assignments of the
         Mortgage showing an unbroken chain of title from the originator to the
         Person assigning it to the Trustee (or to MERS, if the Mortgage Loan is
         registered on the MERS(R) System and noting the presence of a MIN) with
         evidence of recordation noted thereon or attached thereto, or a copy of
         such assignment or assignments of the Mortgage with evidence of
         recording indicated thereon;

                                       57

<PAGE>

                  (v) The original of each modification, assumption agreement or
         preferred loan agreement, if any, relating to such Mortgage Loan, or a
         copy of each modification, assumption agreement or preferred loan
         agreement; and

         and (II) with respect to each Cooperative Loan so assigned:

                  (i) The original Mortgage Note, endorsed without recourse to
         the order of the Trustee and showing an unbroken chain of endorsements
         from the originator thereof to the Person endorsing it to the Trustee,
         or with respect to any Destroyed Mortgage Note, an original lost note
         affidavit from the related Seller or Residential Funding stating that
         the original Mortgage Note was lost, misplaced or destroyed, together
         with a copy of the related Mortgage Note;

                  (ii) A counterpart of the Cooperative Lease and the Assignment
         of Proprietary Lease to the originator of the Cooperative Loan with
         intervening assignments showing an unbroken chain of title from such
         originator to the Trustee;

                  (iii) The related Cooperative Stock Certificate, representing
         the related Cooperative Stock pledged with respect to such Cooperative
         Loan, together with an undated stock power (or other similar
         instrument) executed in blank;

                  (iv) The original recognition agreement by the Cooperative of
         the interests of the mortgagee with respect to the related Cooperative
         Loan;

                  (v) The Security Agreement;

                  (vi) Copies of the original UCC-1 financing statement, and any
         continuation statements, filed by the originator of such Cooperative
         Loan as secured party, each with evidence of recording thereof,
         evidencing the interest of the originator under the Security Agreement
         and the Assignment of Proprietary Lease;

                  (vii) Copies of the filed UCC-3 assignments of the security
         interest referenced in clause (vi) above showing an unbroken chain of
         title from the originator to the Trustee, each with evidence of
         recording thereof, evidencing the interest of the originator under the
         Security Agreement and the Assignment of Proprietary Lease;

                  (viii) An executed assignment of the interest of the
         originator in the Security Agreement, Assignment of Proprietary Lease
         and the recognition agreement referenced in clause (iv) above, showing
         an unbroken chain of title from the originator to the Trustee;

                  (ix) The original of each modification, assumption agreement
         or preferred loan agreement, if any, relating to such Cooperative Loan;
         and

                  (x) A duly completed UCC-1 financing statement showing the
         Master Servicer as debtor, the Company as secured party and the Trustee
         as assignee and a duly completed UCC-1 financing statement showing the
         Company as debtor and the Trustee as secured party,

                                       58

<PAGE>

         each in a form sufficient for filing, evidencing the interest of such
         debtors in the Cooperative Loans.

         The Depositor may, in lieu of delivering the original of the documents
set forth in Section 2.01(b)(I)(ii), (iii), (iv) and (v) and Section
(b)(II)(ii), (iv), (vii), (ix) and (x) (or copies thereof as permitted by
Section 2.01(b)) to the Trustee or the Custodian or Custodians, deliver such
documents to the Master Servicer, and the Master Servicer shall hold such
documents in trust for the use and benefit of all present and future
Certificateholders until such time as is set forth in the next sentence. Within
thirty Business Days following the earlier of (i) the receipt of the original of
all of the documents or instruments set forth in Section 2.01(b)(I)(ii), (iii),
(iv) and (v) and Section (b)(II)(ii), (iv), (vii), (ix) and (x) (or copies
thereof as permitted by such Section) for any Mortgage Loan and (ii) a written
request by the Trustee to deliver those documents with respect to any or all of
the Mortgage Loans then being held by the Master Servicer, the Master Servicer
shall deliver a complete set of such documents to the Trustee or the Custodian
or Custodians that are the duly appointed agent or agents of the Trustee.

         (c) In connection with any Mortgage Loan, if the Depositor cannot
deliver the original of the Mortgage, any assignment, modification, assumption
agreement or preferred loan agreement (or copy thereof as permitted by Section
2.01(b)) with evidence of recording thereon concurrently with the execution and
delivery of this Agreement because of (i) a delay caused by the public recording
office where such Mortgage, assignment, modification, assumption agreement or
preferred loan agreement as the case may be, has been delivered for recordation,
or (ii) a delay in the receipt of certain information necessary to prepare the
related assignments, the Depositor shall deliver or cause to be delivered to the
Trustee or the respective Custodian a copy of such Mortgage, assignment,
modification, assumption agreement or preferred loan agreement.

         The Depositor shall promptly cause to be recorded in the appropriate
public office for real property records the Assignment referred to in clause
(I)(iii) of Section 2.01(b), except (a) in states where, in the opinion of
counsel acceptable to the Trustee, the Insurer and the Master Servicer, such
recording is not required to protect the Trustee's interests in the Mortgage
Loan or (b) if MERS is identified on the Mortgage or on a properly recorded
assignment of the Mortgage as the mortgagee of record solely as nominee for
Residential Funding and its successors and assigns, and shall promptly cause to
be filed the Form UCC-3 assignment and UCC-1 financing statement referred to in
clause (II)(vii) and (x), respectively, of Section 2.01(b). If any Assignment,
Form UCC-3 or Form UCC-1, as applicable, is lost or returned unrecorded to the
Depositor because of any defect therein, the Depositor shall prepare a
substitute Assignment, Form UCC-3 or Form UCC-1, as applicable, or cure such
defect, as the case may be, and cause such Assignment, Form UCC-3 or Form UCC-1,
as applicable, to be recorded in accordance with this paragraph. The Depositor
shall promptly deliver or cause to be delivered to the Trustee or the respective
Custodian such Mortgage or Assignment, Form UCC-3 or Form UCC-1, as applicable
(or copy thereof as permitted by Section 2.01(b)), with evidence of recording
indicated thereon upon receipt thereof from the public recording office or from
the related Subservicer. In connection with its servicing of Cooperative Loans,
the Master Servicer will use its best efforts to file timely continuation
statements with regard to each financing statement and assignment relating to
Cooperative Loans as to which the related Cooperative Apartment is located
outside of the State of New York.

                                       59

<PAGE>

         If the Depositor delivers to the Trustee or Custodian any Mortgage Note
or Assignment of Mortgage in blank, the Depositor shall, or shall cause the
Custodian to, complete the endorsement of the Mortgage Note and the Assignment
of Mortgage in the name of the Trustee in conjunction with the Interim
Certification issued by the Custodian, as contemplated by Section 2.02.

         Any of the items set forth in Sections 2.01(b)(I)(ii), (iii), (iv) and
(v) and (II)(vi) and (vii) and that may be delivered as a copy rather than the
original may be delivered to the Trustee or the Custodian.

         In connection with the assignment of any Mortgage Loan registered on
the MERS(R) System, the Depositor further agrees that it will cause, at the
Depositor's own expense, within 30 days after the Closing Date, the MERS(R)
System to indicate that such Mortgage Loans have been assigned by the Depositor
to the Trustee in accordance with this Agreement for the benefit of the
Certificateholders by including (or deleting, in the case of Mortgage Loans
which are repurchased in accordance with this Agreement) in such computer files
(a) the code in the field which identifies the specific Trustee and (b) the code
in the field "Pool Field" which identifies the series of the Certificates issued
in connection with such Mortgage Loans. The Depositor further agrees that it
will not, and will not permit the Master Servicer to, and the Master Servicer
agrees that it will not, alter the codes referenced in this paragraph with
respect to any Mortgage Loan during the term of this Agreement unless and until
such Mortgage Loan is repurchased in accordance with the terms of this
Agreement.

         (d) It is intended that the conveyances by the Depositor to the Trustee
of the Mortgage Loans as provided for in this Section 2.01 be construed as a
sale by the Depositor to the Trustee of the Mortgage Loans for the benefit of
the Certificateholders. Further, it is not intended that any such conveyance be
deemed to be a pledge of the Mortgage Loans by the Depositor to the Trustee to
secure a debt or other obligation of the Depositor. However, in the event that
the Mortgage Loans are held to be property of the Depositor or of Residential
Funding, or if for any reason this Agreement is held or deemed to create a
security interest in the Mortgage Loans, then it is intended that (a) this
Agreement shall also be deemed to be a security agreement within the meaning of
Articles 8 and 9 of the New York Uniform Commercial Code and the Uniform
Commercial Code of any other applicable jurisdiction; (b) the conveyances
provided for in this Section 2.01 shall be deemed to be (1) a grant by the
Depositor to the Trustee of a security interest in all of the Depositor's right
(including the power to convey title thereto), title and interest, whether now
owned or hereafter acquired, in and to (A) the Mortgage Loans, including (i)
with respect to each Cooperative Loan, the related Mortgage Note, Security
Agreement, Assignment of Proprietary Lease, Cooperative Stock Certificate and
Cooperative Lease, (ii) with respect to each Mortgage Loan other than a
Cooperative Loan, the related Mortgage Note and Mortgage, and (iii) any
insurance policies and all other documents in the related Mortgage File, (B) all
amounts payable pursuant to the Mortgage Loans in accordance with the terms
thereof and (C) any and all general intangibles consisting of, arising from or
relating to any of the foregoing, and all proceeds of the conversion, voluntary
or involuntary, of the foregoing into cash, instruments, securities or other
property, including without limitation all amounts from time to time held or
invested in the Certificate Account or the Custodial Account, whether in the
form of cash, instruments, securities or other property and (2) an assignment by
the Depositor to the Trustee of any security interest in any and all of
Residential Funding's right (including the power to convey title thereto), title
and interest, whether now owned or hereafter

                                       60

<PAGE>

acquired, in and to the property described in the foregoing clauses (1)(A), (B)
and (C) granted by Residential Funding to the Depositor pursuant to the
Assignment Agreement; (c) the possession by the Trustee, the Custodian or any
other agent of the Trustee of Mortgage Notes or such other items of property as
constitute instruments, money, negotiable documents or chattel paper shall be
deemed to be "possession by the secured party," or possession by a purchaser or
a person designated by such secured party, for purposes of perfecting the
security interest pursuant to the Minnesota Uniform Commercial Code and the
Uniform Commercial Code of any other applicable jurisdiction (including, without
limitation, Section 9-115, 9-305, 8-102, 8-301, 8-501, 8-503, 8-313 or 8-321
thereof); and (d) notifications to persons holding such property, and
acknowledgments, receipts or confirmations from persons holding such property,
shall be deemed notifications to, or acknowledgments, receipts or confirmations
from, financial intermediaries, bailees or agents (as applicable) of the Trustee
for the purpose of perfecting such security interest under applicable law.

         The Depositor and, at the Depositor's direction, Residential Funding
and the Trustee 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. Without limiting the
generality of the foregoing, the Depositor shall prepare and deliver to the
Trustee not less than 15 days prior to any filing date and, the Trustee shall
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 Uniform Commercial Code as in effect in any
jurisdiction to perfect the Trustee's security interest in or lien on the
Mortgage Loans as evidenced by an Officers' Certificate of the Depositor, with a
copy delivered to the Insurer, including without limitation (x) continuation
statements, and (y) such other statements as may be occasioned by (1) any change
of name of Residential Funding, the Depositor or the Trustee (such preparation
and filing shall be at the expense of the Trustee, if occasioned by a change in
the Trustee's name), (2) any change of location of the place of business or the
chief executive office of Residential Funding or the Depositor or (3) any
transfer of any interest of Residential Funding or the Depositor in any Mortgage
Loan.

         Section 2.02.     ACCEPTANCE BY TRUSTEE.

         The Trustee acknowledges receipt (or, with respect to Mortgage Loans
subject to a Custodial Agreement, and based solely upon a receipt or
certification executed by the Custodian, receipt by the respective Custodian as
the duly appointed agent of the Trustee) of the documents referred to in Section
2.01(b)(I)(i) and Section 2.01(b)(II)(i), (iii), (v), (vi) and (viii) above
(except that for purposes of such acknowledgment only, a Mortgage Note may be
endorsed in blank and an Assignment of Mortgage may be in blank) and declares
that it, or a Custodian as its agent, holds and will hold such documents and the
other documents constituting a part of the Mortgage Files delivered to it, or a
Custodian as its agent, in trust for the use and benefit of all present and
future Certificateholders. The Trustee or Custodian (such Custodian being so
obligated under a Custodial Agreement) agrees, for the benefit of
Certificateholders, to review each Mortgage File delivered to it pursuant to
Section 2.01(b) within 45 days after the Closing Date to ascertain that all
required documents (specifically as set forth in Section 2.01(b)), have been
executed and received, and that such documents relate to the Mortgage Loans
identified on the Mortgage Loan Schedule, as

                                       61

<PAGE>

supplemented, that have been conveyed to it, and to deliver to the Trustee a
certificate (the "Interim Certification") to the effect that all documents
required to be delivered pursuant to Section 2.01(b) above have been executed
and received and that such documents relate to the Mortgage Loans identified on
the Mortgage Loan Schedule, except for any exceptions listed on Schedule A
attached to such Interim Certification. Upon delivery of the Mortgage Files by
the Depositor or the Master Servicer, the Trustee shall acknowledge receipt (or,
with respect to Mortgage Loans subject to a Custodial Agreement, and based
solely upon a receipt or certification executed by the Custodian, receipt by the
respective Custodian as the duly appointed agent of the Trustee) of the
documents referred to in Section 2.01(c) above. If the Custodian, as the
Trustee's agent, finds any document or documents constituting a part of a
Mortgage File to be missing or defective, the Trustee shall promptly so notify
the Master Servicer and the Depositor; provided, that if the Mortgage Loan
related to such Mortgage File is listed on Schedule A of the Assignment
Agreement, no notification shall be necessary. Pursuant to Section 2.3 of the
Custodial Agreement, the Custodian will notify the Master Servicer, the
Depositor and the Trustee of any such omission or defect found by it in respect
of any Mortgage File held by it. If such omission or defect materially and
adversely affects the interests in the related Mortgage Loan of the
Certificateholders or the Insurer, the Master Servicer shall promptly notify the
related Subservicer of such omission or defect and request that such Subservicer
correct or cure such omission or defect within 60 days from the date the Master
Servicer was notified of such omission or defect and, if such Subservicer does
not correct or cure such omission or defect within such period, that such
Subservicer purchase such Mortgage Loan from the Trust Fund at its Purchase
Price, in either case within 90 days from the date the Master Servicer was
notified of such omission or defect; provided that if the omission or defect
would cause the Mortgage Loan to be other than a "qualified mortgage" as defined
in Section 860G(a)(3) of the Code, any such cure or repurchase must occur within
90 days from the date such breach was discovered; and provided further, that no
cure, substitution or repurchase shall be required if such omission or defect is
in respect of a Mortgage Loan listed on Schedule A of the Assignment Agreement.
The Purchase Price for any such Mortgage Loan shall be deposited or caused to be
deposited by the Master Servicer in the Custodial Account maintained by it
pursuant to Section 3.07 and, upon receipt by the Trustee of written
notification of such deposit signed by a Servicing Officer, the Trustee or any
Custodian, as the case may be, shall release to the Master Servicer the related
Mortgage File and the Trustee shall execute and deliver such instruments of
transfer or assignment prepared by the Master Servicer, in each case without
recourse, as shall be necessary to vest in the Subservicer or its designee, as
the case may be, any Mortgage Loan released pursuant hereto and thereafter such
Mortgage Loan shall not be part of the Trust Fund. In furtherance of the
foregoing, if the Subservicer or Residential Funding that repurchases the
Mortgage Loan is not a member of MERS and the Mortgage is registered on the
MERS(R) System, the Master Servicer, at its own expense and without any right of
reimbursement, shall cause MERS to execute and deliver an assignment of the
Mortgage in recordable form to transfer the Mortgage from MERS to such
Subservicer or Residential Funding and shall cause such Mortgage to be removed
from registration on the MERS(R) System in accordance with MERS' rules and
regulations. It is understood and agreed that the obligation of the Subservicer,
to so cure or purchase any Mortgage Loan as to which a material and adverse
defect in or omission of a constituent document exists shall constitute the sole
remedy respecting such defect or omission available to Certificateholders or the
Trustee on behalf of Certificateholders (except for the Insurer's rights under
the Insurance Agreement).

                                       62

<PAGE>

         Section 2.03.     REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE
                           MASTER SERVICER AND THE DEPOSITOR.

         (a) The Master Servicer hereby represents and warrants to the Trustee
for the benefit of the Certificateholders and the Insurer that: (i) The Master
Servicer is a corporation duly organized, validly existing and in good standing
under the laws governing its creation and existence and is or will be in
compliance with the laws of each state in which any Mortgaged Property is
located to the extent necessary to ensure the enforceability of each Mortgage
Loan in accordance with the terms of this Agreement; (ii) The execution and
delivery of this Agreement by the Master Servicer and its performance and
compliance with the terms of this Agreement will not violate the Master
Servicer's Certificate of Incorporation or Bylaws or constitute a material
default (or an event which, with notice or lapse of time, or both, would
constitute a material default) under, or result in the material breach of, any
material contract, agreement or other instrument to which the Master Servicer is
a party or which may be applicable to the Master Servicer or any of its assets;
(iii) This Agreement, assuming due authorization, execution and delivery by the
Trustee and the Depositor, constitutes a valid, legal and binding obligation of
the Master Servicer, enforceable against it in accordance with the terms hereof
subject to applicable bankruptcy, insolvency, reorganization, moratorium and
other laws affecting the enforcement of creditors' rights generally and to
general principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law; (iv) The Master Servicer is not
in default with respect to any order or decree of any court or any order,
regulation or demand of any federal, state, municipal or governmental agency,
which default might have consequences that would materially and adversely affect
the condition (financial or other) or operations of the Master Servicer or its
properties or might have consequences that would materially adversely affect its
performance hereunder; (v) No litigation is pending or, to the best of the
Master Servicer's knowledge, threatened against the Master Servicer which would
prohibit its entering into this Agreement or performing its obligations under
this Agreement; (vi) The Master Servicer will comply in all material respects in
the performance of this Agreement with all reasonable rules and requirements of
each insurer under each Required Insurance Policy; (vii) No information,
certificate of an officer, statement furnished in writing or report delivered to
the Depositor, any Affiliate of the Depositor or the Trustee by the Master
Servicer will, to the knowledge of the Master Servicer, contain any untrue
statement of a material fact or omit a material fact necessary to make the
information, certificate, statement or report not misleading; (viii) The Master
Servicer has examined each existing, and will examine each new, Subservicing
Agreement and is or will be familiar with the terms thereof. The terms of each
existing Subservicing Agreement and each designated Subservicer are acceptable
to the Master Servicer and any new Subservicing Agreements will comply with the
provisions of Section 3.02; and (ix) The Master Servicer is a member of MERS in
good standing, and will comply in all material respects with the rules and
procedures of MERS in connection with the servicing of the Mortgage Loans that
are registered with MERS. It is understood and agreed that the representations
and warranties set forth in this Section 2.03(a) shall survive delivery of the
respective Mortgage Files to the Trustee or any Custodian. Upon discovery by
either the Depositor, the Master Servicer, the Insurer, the Trustee or any
Custodian of a breach of any representation or warranty set forth in this
Section 2.03(a) which materially and adversely affects the interests of the
Certificateholders or the Insurer in any Mortgage Loan, the party discovering
such breach shall give prompt written notice to the other parties (any Custodian
being so obligated under a Custodial Agreement). Within 90 days of its discovery
or its receipt of notice of such breach, the Master Servicer shall either (i)
cure such breach in all material respects or (ii) to the extent that such

                                       63

<PAGE>

breach is with respect to a Mortgage Loan or a related document, purchase such
Mortgage Loan from the Trust Fund at the Purchase Price and in the manner set
forth in Section 2.02; provided that if the omission or defect would cause the
Mortgage Loan to be other than a "qualified mortgage" as defined in Section
860G(a)(3) of the Code, any such cure or repurchase must occur within 90 days
from the date such breach was discovered. The obligation of the Master Servicer
to cure such breach or to so purchase such Mortgage Loan shall constitute the
sole remedy in respect of a breach of a representation and warranty set forth in
this Section 2.03(a) available to the Certificateholders or the Trustee on
behalf of the Certificateholders (except for the Insurer's rights under Section
3.03 of the Insurance Agreement).

         (b) The Depositor hereby represents and warrants to the Trustee for the
benefit of the Certificateholders and the Insurer that as of the Closing Date
(or, if otherwise specified below, as of the date so specified): (i) The
information set forth in Exhibit F-1 and Exhibit F-2 hereto with respect to each
Mortgage Loan or the Mortgage Loans, as the case may be, is true and correct in
all material respects at the respective date or dates which such information is
furnished; (ii) Immediately prior to the conveyance of the Mortgage Loans to the
Trustee, the Depositor had good title to, and was the sole owner of, each
Mortgage Loan free and clear of any pledge, lien, encumbrance or security
interest (other than rights to servicing and related compensation) and such
conveyance validly transfers ownership of the Mortgage Loans to the Trustee free
and clear of any pledge, lien, encumbrance or security interest; and (iii) Each
Mortgage Loan constitutes a qualified mortgage under Section 860G(a)(3)(A) of
the Code and Treasury Regulations Section 1.860G-2(a)(1). It is understood and
agreed that the representations and warranties set forth in this Section 2.03(b)
shall survive delivery of the respective Mortgage Files to the Trustee or any
Custodian. Upon discovery by any of the Depositor, the Master Servicer, the
Insurer, the Trustee or any Custodian of a breach of any of the representations
and warranties set forth in this Section 2.03(b) which materially and adversely
affects the interests of the Certificateholders or the Insurer in any Mortgage
Loan, the party discovering such breach shall give prompt written notice to the
other parties (including the Insurer) (any Custodian being so obligated under a
Custodial Agreement); PROVIDED, HOWEVER, that in the event of a breach of the
representation and warranty set forth in Section 2.03(b)(iii), the party
discovering such breach shall give such notice within five days of discovery.
Within 90 days of its discovery or its receipt of notice of breach, the
Depositor shall either (i) cure such breach in all material respects or (ii)
purchase such Mortgage Loan from the Trust Fund at the Purchase Price and in the
manner set forth in Section 2.02; provided that the Depositor shall have the
option to substitute a Qualified Substitute Mortgage Loan or Loans for such
Mortgage Loan if such substitution occurs within two years following the Closing
Date; provided that if the omission or defect would cause the Mortgage Loan to
be other than a "qualified mortgage" as defined in Section 860G(a)(3) of the
Code, any such cure, substitution or repurchase must occur within 90 days from
the date such breach was discovered. Any such substitution shall be effected by
the Depositor under the same terms and conditions as provided in Section 2.04
for substitutions by Residential Funding. It is understood and agreed that the
obligation of the Depositor to cure such breach or to so purchase or substitute
for any Mortgage Loan as to which such a breach has occurred and is continuing
shall constitute the sole remedy respecting such breach available to the
Certificateholders (other than the Insurer) or the Trustee on behalf of the
Certificateholders (other than the Insurer). Notwithstanding the foregoing, the
Depositor shall not be required to cure breaches or purchase or substitute for
Mortgage Loans as provided in this Section 2.03(b) if the substance of the
breach of a representation set forth above also constitutes fraud in the
origination of the Mortgage Loan.

                                       64

<PAGE>

         Section 2.04.     REPRESENTATIONS AND WARRANTIES OF RESIDENTIAL
                           FUNDING.

         The Depositor, as assignee of Residential Funding under the Assignment
Agreement, hereby assigns to the Trustee for the benefit of the
Certificateholders all of its right, title and interest in respect of the
Assignment Agreement applicable to a Mortgage Loan. Insofar as the Assignment
Agreement relates to the representations and warranties made by Residential
Funding in respect of such Mortgage Loan and any remedies provided thereunder
for any breach of such representations and warranties, such right, title and
interest may be enforced by the Master Servicer on behalf of the Trustee and the
Certificateholders. Upon the discovery by the Depositor, the Master Servicer,
the Trustee, the Insurer or any Custodian of a breach of any of the
representations and warranties made in the Assignment Agreement in respect of
any Mortgage Loan or of any Repurchase Event which materially and adversely
affects the interests of the Certificateholders or the Insurer in such Mortgage
Loan, the party discovering such breach shall give prompt written notice to the
other parties (including the Insurer) (any Custodian being so obligated under a
Custodial Agreement). The Master Servicer shall promptly notify Residential
Funding of such breach or Repurchase Event and request that Residential Funding
either (i) cure such breach or Repurchase Event in all material respects within
90 days from the date the Master Servicer was notified of such breach or
Repurchase Event or (ii) purchase such Mortgage Loan from the Trust Fund at the
Purchase Price and in the manner set forth in Section 2.02; provided that, in
the case of a breach or Repurchase Event under the Assignment Agreement,
Residential Funding shall have the option to substitute a Qualified Substitute
Mortgage Loan or Loans for such Mortgage Loan if such substitution occurs within
two years following the Closing Date; provided that if the breach would cause
the Mortgage Loan to be other than a "qualified mortgage" as defined in Section
860G(a)(3) of the Code, any such cure or substitution must occur within 90 days
from the date the breach was discovered. In the event that Residential Funding
elects to substitute a Qualified Substitute Mortgage Loan or Loans for a Deleted
Mortgage Loan pursuant to this Section 2.04, Residential Funding shall deliver
to the Trustee for the benefit of the Certificateholders with respect to such
Qualified Substitute Mortgage Loan or Loans, the original Mortgage Note, the
Mortgage, an Assignment of the Mortgage in recordable form, and such other
documents and agreements as are required by Section 2.01, with the Mortgage Note
endorsed as required by Section 2.01. No substitution will be made in any
calendar month after the Determination Date for such month. Monthly Payments due
with respect to Qualified Substitute Mortgage Loans in the month of substitution
shall not be part of the Trust Fund and will be retained by the Master Servicer
and remitted by the Master Servicer to Residential Funding on the next
succeeding Distribution Date. For the month of substitution, distributions to
the Certificateholders will include the Monthly Payment due on a Deleted
Mortgage Loan for such month and thereafter Residential Funding shall be
entitled to retain all amounts received in respect of such Deleted Mortgage
Loan. The Master Servicer shall amend or cause to be amended the Mortgage Loan
Schedule for the benefit of the Certificateholders to reflect the removal of
such Deleted Mortgage Loan and the substitution of the Qualified Substitute
Mortgage Loan or Loans and the Master Servicer shall deliver the amended
Mortgage Loan Schedule to the Trustee. Upon such substitution, the Qualified
Substitute Mortgage Loan or Loans shall be subject to the terms of this
Agreement and the related Subservicing Agreement in all respects, and
Residential Funding shall be deemed to have made the representations and
warranties with respect to the Qualified Substitute Mortgage Loan contained in
Section 4 of the Assignment Agreement, as of the date of substitution, and the
covenants, representations and warranties set forth in this Section 2.04, and in
Section 2.03 hereof and in Section 4 of the Assignment Agreement, and the Master
Servicer shall be obligated to

                                       65

<PAGE>

repurchase or substitute for any Qualified Substitute Mortgage Loan as to which
a Repurchase Event (as defined in the Assignment Agreement) has occurred
pursuant to Section 4 of the Assignment Agreement. In connection with the
substitution of one or more Qualified Substitute Mortgage Loans for one or more
Deleted Mortgage Loans, the Master Servicer will determine the amount (if any)
by which the aggregate principal balance of all such Qualified Substitute
Mortgage Loans as of the date of substitution is less than the aggregate Stated
Principal Balance of all such Deleted Mortgage Loans (in each case after
application of the principal portion of the Monthly Payments due in the month of
substitution that are to be distributed to the Certificateholders in the month
of substitution). Residential Funding shall deposit the amount of such shortfall
into the Custodial Account on the day of substitution, without any reimbursement
therefor. Residential Funding shall give notice in writing to the Trustee of
such event, which notice shall be accompanied by an Officers' Certificate as to
the calculation of such shortfall and by an Opinion of Counsel to the effect
that such substitution will not cause (a) any federal tax to be imposed on the
Trust Fund, including without limitation, any federal tax imposed on "prohibited
transactions" under Section 860F(a)(1) of the Code or on "contributions after
the startup date" under Section 860G(d)(1) of the Code or (b) any portion of
REMIC I, REMIC II, REMIC III or REMIC IV to fail to qualify as a REMIC at any
time that any Certificate is outstanding. It is understood and agreed that the
obligation of the Residential Funding to cure such breach or purchase (or in the
case of Residential Funding to substitute for) such Mortgage Loan as to which
such a breach has occurred and is continuing shall constitute the sole remedy
respecting such breach available to the Certificateholders (other than the
Insurer) or the Trustee on behalf of the Certificateholders (other than the
Insurer). If the Master Servicer is Residential Funding, then the Trustee shall
also have the right to give the notification and require the purchase or
substitution provided for in the second preceding paragraph in the event of such
a breach of a representation or warranty made by Residential Funding in the
Assignment Agreement. In connection with the purchase of or substitution for any
such Mortgage Loan by Residential Funding, the Trustee shall assign to
Residential Funding all of the right, title and interest in respect of the
Assignment Agreement applicable to such Mortgage Loan.

         Section 2.05.     EXECUTION AND AUTHENTICATION OF CERTIFICATES;
                           CONVEYANCE OF UNCERTIFICATED REMIC REGULAR INTERESTS.

         (a) The Trustee acknowledges the assignment to it of the Mortgage Loans
and the delivery of the Mortgage Files to it, or any Custodian on its behalf,
subject to any exceptions noted, together with the assignment to it of all other
assets included in the Trust Fund, receipt of which is hereby acknowledged.
Concurrently with such delivery and in exchange therefor, the Trustee, pursuant
to the written request of the Depositor executed by an officer of the Depositor,
has executed and caused to be authenticated and delivered to or upon the order
of the Depositor the Certificates in authorized denominations which evidence
ownership of the entire Trust Fund.

         (b) The Depositor, concurrently with the execution and delivery hereof,
does hereby transfer, assign, set over and otherwise convey in trust to the
Trustee without recourse all the right, title and interest of the Depositor in
and to the REMIC I Regular Interests and the REMIC II Regular Interest for the
benefit of the Holders of the REMIC III Regular Interests and the Holders of the
Class R-III Certificates. The Trustee acknowledges receipt of the REMIC I
Regular Interests and the REMIC II Regular Interest (each of which is
uncertificated) and declares that it holds and will hold the same in trust for
the exclusive use and benefit of the Holders of the REMIC III Regular Interests

                                       66

<PAGE>

and Holders of the Class R-III Certificates. The interests evidenced by the
Class R-III Certificates, together with the REMIC III Regular Interests,
constitute the entire beneficial ownership interest in REMIC III.

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

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

                                       67

<PAGE>

                                   ARTICLE III

                 ADMINISTRATION AND SERVICING OF MORTGAGE LOANS

         Section 3.01.     MASTER SERVICER TO ACT AS SERVICER.

         (a) The Master Servicer shall service and administer the Mortgage Loans
in accordance with the terms of this Agreement and the respective Mortgage
Loans, following such procedures as it would employ in its good faith business
judgment and which are normal and usual in its general mortgage servicing
activities, and shall have full power and authority, acting alone or through
Subservicers as provided in Section 3.02, to do any and all things which it may
deem necessary or desirable in connection with such servicing and
administration. Without limiting the generality of the foregoing, the Master
Servicer in its own name or in the name of a Subservicer is hereby authorized
and empowered by the Trustee when the Master Servicer or the Subservicer, as the
case may be, believes it appropriate in its best judgment, to execute and
deliver, on behalf of the Certificateholders and the Trustee or any of them, any
and all instruments of satisfaction or cancellation, or of partial or full
release or discharge, or of consent to assumption or modification in connection
with a proposed conveyance, or of assignment of any Mortgage and Mortgage Note
in connection with the repurchase of a Mortgage Loan and all other comparable
instruments, or with respect to the modification or re-recording of a Mortgage
for the purpose of correcting the Mortgage, the subordination of the lien of the
Mortgage in favor of a public utility company or government agency or unit with
powers of eminent domain, the taking of a deed in lieu of foreclosure, the
completion of judicial or non-judicial foreclosure, the conveyance of a
Mortgaged Property to the related insurer, the acquisition of any property
acquired by foreclosure or deed in lieu of foreclosure, or the management,
marketing and conveyance of any property acquired by foreclosure or deed in lieu
of foreclosure with respect to the Mortgage Loans and with respect to the
Mortgaged Properties. The Master Servicer further is authorized and empowered by
the Trustee, on behalf of the Certificateholders and the Trustee, in its own
name or in the name of the Subservicer, when the Master Servicer or the
Subservicer, as the case may be, believes it is appropriate in its best judgment
to register any Mortgage Loan on the MERS(R) System, or cause the removal from
the registration of any Mortgage Loan on the MERS(R) System, to execute and
deliver, on behalf of the Trustee and the Certificateholders or any of them, any
and all instruments of assignment and other comparable instruments with respect
to such assignment or re-recording of a Mortgage in the name of MERS, solely as
nominee for the Trustee and its successors and assigns. Any expenses incurred in
connection with the actions described in the preceding sentence shall be borne
by the Master Servicer in accordance with Section 3.16(c), with no right of
reimbursement; provided, that if, as a result of MERS discontinuing or becoming
unable to continue operations in connection with the MERS System, it becomes
necessary to remove any Mortgage Loan from registration on the MERS System and
to arrange for the assignment of the related Mortgages to the Trustee, then any
related expenses shall be reimbursable to the Master Servicer. Notwithstanding
the foregoing, subject to Section 3.07(a), the Master Servicer shall not permit
any modification with respect to any Mortgage Loan that would both constitute a
sale or exchange of such Mortgage Loan within the meaning of Section 1001 of the
Code and any proposed, temporary or final regulations promulgated thereunder
(other than in connection with a proposed conveyance or assumption of such
Mortgage Loan that is treated as a Principal Prepayment in Full pursuant to
Section 3.13(d) hereof) and cause any of REMIC I, REMIC II, REMIC III or REMIC
IV to fail to qualify as a REMIC under the Code. The Trustee shall

                                       68

<PAGE>

furnish the Master Servicer with any powers of attorney and other documents
necessary or appropriate to enable the Master Servicer to service and administer
the Mortgage Loans. The Trustee shall not be liable for any action taken by the
Master Servicer or any Subservicer pursuant to such powers of attorney. In
servicing and administering any Nonsubserviced Mortgage Loan, the Master
Servicer shall, to the extent not inconsistent with this Agreement, comply with
the Program Guide as if it were the originator of such Mortgage Loan and had
retained the servicing rights and obligations in respect thereof. In connection
with servicing and administering the Mortgage Loans, the Master Servicer and any
Affiliate of the Master Servicer (i) may perform services such as appraisals and
brokerage services that are customarily provided by Persons other than servicers
of mortgage loans, and shall be entitled to reasonable compensation therefor in
accordance with Section 3.10 and (ii) may, at its own discretion and on behalf
of the Trustee, obtain credit information in the form of a "credit score" from a
credit repository.

         (b) All costs incurred by the Master Servicer or by Subservicers in
effecting the timely payment of taxes and assessments on the properties subject
to the Mortgage Loans shall not, for the purpose of calculating monthly
distributions to the Certificateholders, be added to the amount owing under the
related Mortgage Loans, notwithstanding that the terms of such Mortgage Loan so
permit, and such costs shall be recoverable to the extent permitted by Section
3.10(a)(ii).

         (c) The Master Servicer may enter into one or more agreements in
connection with the offering of pass-through certificates evidencing interests
in one or more of the Certificates providing for the payment by the Master
Servicer of amounts received by the Master Servicer as servicing compensation
hereunder and required to cover certain Prepayment Interest Shortfalls on the
Mortgage Loans, which payment obligation will thereafter be an obligation of the
Master Servicer hereunder.

         (d) To the extent the Master Servicer or any Subservicer receives
payments in respect of Arrearages, such payments shall be retained by the Master
Servicer or Subservicer and shall not be deposited in the Custodial Account. Any
monthly payment received with respect to a Mortgage Loan subject to a repayment
plan (other than a bankruptcy plan) that is not sufficient to satisfy the
Monthly Payment and the monthly Arrearage shall be applied by the Master
Servicer first to the Monthly Payment and then in payment of the monthly
Arrearage. Any monthly payment received with respect to a Mortgage Loan subject
to a repayment plan (other than a bankruptcy plan) that is greater than the
payment required under the repayment plan shall be applied first, in reduction
of any remaining Arrearage with respect to such Mortgage Loan, and then in
reduction of the principal balance thereof as a principal prepayment.

         (e) Any payment made by a Mortgagor under a Mortgage Loan subject to a
bankruptcy plan shall be allocated between the Arrearage and the Monthly Payment
as provided in the related bankruptcy plan.

         Section 3.02.     SUBSERVICING AGREEMENTS BETWEEN MASTER SERVICER AND
                           SUBSERVICERS; ENFORCEMENT OF SUBSERVICERS'
                           OBLIGATIONS.

         (a) The Master Servicer may continue in effect Subservicing Agreements
entered into by Residential Funding and Subservicers prior to the execution and
delivery of this Agreement, and

                                       69

<PAGE>

may enter into new Subservicing Agreements with Subservicers, for the servicing
and administration of all or some of the Mortgage Loans. Each Subservicer shall
be either (i) an institution the accounts of which are insured by the FDIC or
(ii) another entity that engages in the business of originating or servicing
mortgage loans, and in either case shall be authorized to transact business in
the state or states in which the related Mortgaged Properties it is to service
are situated, if and to the extent required by applicable law to enable the
Subservicer to perform its obligations hereunder and under the Subservicing
Agreement, and in either case shall be a Freddie Mac, Fannie Mae or HUD approved
mortgage servicer. In addition, any Subservicer of a Mortgage Loan insured by
the FHA must be an FHA-approved servicer, and any Subservicer of a Mortgage Loan
guaranteed by the VA must be a VA-approved servicer. Each Subservicer of a
Mortgage Loan shall be entitled to receive and retain, as provided in the
related Subservicing Agreement and in Section 3.07, the related Subservicing Fee
from payments of interest received on such Mortgage Loan after payment of all
amounts required to be remitted to the Master Servicer in respect of such
Mortgage Loan. For any Mortgage Loan that is a Nonsubserviced Mortgage Loan, the
Master Servicer shall be entitled to receive and retain an amount equal to the
Subservicing Fee from payments of interest. Unless the context otherwise
requires, references in this Agreement to actions taken or to be taken by the
Master Servicer in servicing the Mortgage Loans include actions taken or to be
taken by a Subservicer on behalf of the Master Servicer. Each Subservicing
Agreement will be upon such terms and conditions as are generally required by,
permitted by or consistent with the Program Guide and are not inconsistent with
this Agreement and as the Master Servicer and the Subservicer have agreed. With
the approval of the Master Servicer, a Subservicer may delegate its servicing
obligations to third- party servicers, but such Subservicer will remain
obligated under the related Subservicing Agreement. The Master Servicer and a
Subservicer may enter into amendments thereto or a different form of
Subservicing Agreement, and the form referred to or included in the Program
Guide is merely provided for information and shall not be deemed to limit in any
respect the discretion of the Master Servicer to modify or enter into different
Subservicing Agreements; PROVIDED, HOWEVER, that any such amendments or
different forms shall be consistent with and not violate the provisions of
either this Agreement or the Program Guide in a manner which would materially
and adversely affect the interests of the Certificateholders or the Insurer.

         (b) As part of its servicing activities hereunder, the Master Servicer,
for the benefit of the Trustee, the Insurer and the Certificateholders, shall
use its best reasonable efforts to enforce the obligations of each Subservicer
under the related Subservicing Agreement, to the extent that the non-
performance of any such obligation would have a material and adverse effect on a
Mortgage Loan, including, without limitation, the obligation to purchase a
Mortgage Loan on account of defective documentation, as described in Section
2.02, or on account of a breach of a representation or warranty, as described in
Section 2.04. Such enforcement, including, without limitation, the legal
prosecution of claims, termination of Subservicing Agreements, as appropriate,
and the pursuit of other appropriate remedies, shall be in such form and carried
out to such an extent and at such time as the Master Servicer would employ in
its good faith business judgment and which are normal and usual in its general
mortgage servicing activities. The Master Servicer shall pay the costs of such
enforcement at its own expense, and shall be reimbursed therefor only (i) from a
general recovery resulting from such enforcement to the extent, if any, that
such recovery exceeds all amounts due in respect of the related Mortgage Loan or
(ii) from a specific recovery of costs, expenses or attorneys fees against the
party against whom such enforcement is directed.

                                       70

<PAGE>

         Section 3.03.     SUCCESSOR SUBSERVICERS.

         The Master Servicer shall be entitled to terminate any Subservicing
Agreement that may exist in accordance with the terms and conditions of such
Subservicing Agreement and without any limitation by virtue of this Agreement;
PROVIDED, HOWEVER, that in the event of termination of any Subservicing
Agreement by the Master Servicer or the Subservicer, the Master Servicer shall
either act as servicer of the related Mortgage Loan or enter into a Subservicing
Agreement with a successor Subservicer which will be bound by the terms of the
related Subservicing Agreement. If the Master Servicer or any Affiliate of
Residential Funding acts as servicer, it will not assume liability for the
representations and warranties of the Subservicer which it replaces. If the
Master Servicer enters into a Subservicing Agreement with a successor
Subservicer, the Master Servicer shall use reasonable efforts to have the
successor Subservicer assume liability for the representations and warranties
made by the terminated Subservicer in respect of the related Mortgage Loans and,
in the event of any such assumption by the successor Subservicer, the Master
Servicer may, in the exercise of its business judgment, release the terminated
Subservicer from liability for such representations and warranties.

         Section 3.04.     LIABILITY OF THE MASTER SERVICER.

         Notwithstanding any Subservicing Agreement, any of the provisions of
this Agreement relating to agreements or arrangements between the Master
Servicer or a Subservicer or reference to actions taken through a Subservicer or
otherwise, the Master Servicer shall remain obligated and liable to the Trustee,
the Insurer and Certificateholders for the servicing and administering of the
Mortgage Loans in accordance with the provisions of Section 3.01 without
diminution of such obligation or liability by virtue of such Subservicing
Agreements or arrangements or by virtue of indemnification from the Subservicer
or the Depositor and to the same extent and under the same terms and conditions
as if the Master Servicer alone were servicing and administering the Mortgage
Loans. The Master Servicer shall be entitled to enter into any agreement with a
Subservicer for indemnification of the Master Servicer and nothing contained in
this Agreement shall be deemed to limit or modify such indemnification.

         Section 3.05.     NO CONTRACTUAL RELATIONSHIP BETWEEN SUBSERVICER AND
                           TRUSTEE OR CERTIFICATEHOLDERS.

         Any Subservicing Agreement that may be entered into and any other
transactions or services relating to the Mortgage Loans involving a Subservicer
in its capacity as such and not as an originator shall be deemed to be between
the Subservicer and the Master Servicer alone and the Trustee and
Certificateholders shall not be deemed parties thereto and shall have no claims,
rights, obligations, duties or liabilities with respect to the Subservicer in
its capacity as such except as set forth in Section 3.06. The foregoing
provision shall not in any way limit a Subservicer's obligation to cure an
omission or defect or to repurchase a Mortgage Loan as referred to in Section
2.02 hereof.

         Section 3.06.     ASSUMPTION OR TERMINATION OF SUBSERVICING AGREEMENTS
                           BY TRUSTEE.

         (a) In the event the Master Servicer shall for any reason no longer be
the master servicer (including by reason of an Event of Default), the Trustee,
its designee or its successor shall thereupon assume all of the rights and
obligations of the Master Servicer under each Subservicing

                                       71

<PAGE>

Agreement that may have been entered into. The Trustee, its designee or the
successor servicer for the Trustee shall be deemed to have assumed all of the
Master Servicer's interest therein and to have replaced the Master Servicer as a
party to the Subservicing Agreement to the same extent as if the Subservicing
Agreement had been assigned to the assuming party except that the Master
Servicer shall not thereby be relieved of any liability or obligations under the
Subservicing Agreement.

         (b) The Master Servicer shall, upon request of the Trustee but at the
expense of the Master Servicer, deliver to the assuming party all documents and
records relating to each Subservicing Agreement and the Mortgage Loans then
being serviced and an accounting of amounts collected and held by it and
otherwise use its best efforts to effect the orderly and efficient transfer of
each Subservicing Agreement to the assuming party.

         (c) Unless an Insurer Default exists, the Master Servicer will, if it
is authorized to do so under the relevant Subservicing Agreement, upon request
of the Insurer at a time when the Insurer may remove the Master Servicer under
the terms hereof, terminate any Subservicing Agreement.

         Section 3.07.     COLLECTION OF CERTAIN MORTGAGE LOAN PAYMENTS;
                           DEPOSITS TO CUSTODIAL ACCOUNT.

         (a) The Master Servicer shall make reasonable efforts to collect all
payments called for under the terms and provisions of the Mortgage Loans, and
shall, to the extent such procedures shall be consistent with this Agreement and
the terms and provisions of any related Primary Insurance Policy, follow such
collection procedures as it would employ in its good faith business judgment and
which are normal and usual in its general mortgage servicing activities.
Consistent with the foregoing, the Master Servicer may in its discretion (i)
waive any late payment charge or any prepayment charge or penalty interest in
connection with the prepayment of a Mortgage Loan and (ii) extend the Due Date
for payments due on a Mortgage Loan in accordance with the Program Guide,
PROVIDED, HOWEVER, that the Master Servicer shall first determine that any such
waiver or extension will not impair the coverage of any related Primary
Insurance Policy or materially adversely affect the lien of the related
Mortgage. In the event of any such arrangement, the Master Servicer shall make
timely advances on the related Mortgage Loan during the scheduled period in
accordance with the amortization schedule of such Mortgage Loan without
modification thereof by reason of such arrangements unless otherwise agreed to
by the Holders of the Classes of Certificates affected thereby; PROVIDED,
HOWEVER, that no such extension shall be made if any advance would be a
Nonrecoverable Advance. Consistent with the terms of this Agreement, the Master
Servicer may also waive, modify or vary any term of any Mortgage Loan or consent
to the postponement of strict compliance with any such term or in any manner
grant indulgence to any Mortgagor if in the Master Servicer's determination such
waiver, modification, postponement or indulgence is not materially adverse to
the interests of the Certificateholders or the Insurer (taking into account any
estimated Realized Loss that might result absent such action), PROVIDED,
HOWEVER, that the Master Servicer may not modify materially or permit any
Subservicer to modify any Mortgage Loan, including without limitation any
modification that would change the Mortgage Rate, forgive the payment of any
principal or interest (unless in connection with the liquidation of the related
Mortgage Loan or except in connection with prepayments to the extent that such
reamortization is not inconsistent with the terms of the Mortgage Loan), or
extend the final maturity date of such Mortgage Loan, unless such Mortgage Loan
is in default or, in the judgment of the Master Servicer, such default is
reasonably

                                       72

<PAGE>

foreseeable. In connection with any Curtailment of a Mortgage Loan, the Master
Servicer, to the extent not inconsistent with the terms of the Mortgage Note and
local law and practice, may permit the Mortgage Loan to be re-amortized such
that the Monthly Payment is recalculated as an amount that will fully amortize
the remaining Stated Principal Amount thereof by the original Maturity Date
based on the original Mortgage Rate; provided, that such reamortization shall
not be permitted if it would constitute a reissuance of the Mortgage Loan for
federal income tax purposes.

         (b) The Master Servicer shall establish and maintain a Custodial
Account in which the Master Servicer shall deposit or cause to be deposited on a
daily basis, except as otherwise specifically provided herein, the following
payments and collections remitted by Subservicers or received by it in respect
of the Mortgage Loans subsequent to the Cut-off Date (other than in respect of
principal and interest on the Mortgage Loans due on or before the Cut-off Date):
(i) All payments on account of principal, including Principal Prepayments made
by Mortgagors on the Mortgage Loans and the principal component of any
Subservicer Advance or of any REO Proceeds received in connection with an REO
Property for which an REO Disposition has occurred (other than any payments
received in respect of any Arrearages); (ii) All payments on account of interest
at the Adjusted Mortgage Rate on the Mortgage Loans, including the interest
component of any Subservicer Advance or of any REO Proceeds received in
connection with an REO Property for which an REO Disposition has occurred; (iii)
Insurance Proceeds and Liquidation Proceeds (net of any related expenses of the
Subservicer); (iv) All proceeds of any Mortgage Loans purchased pursuant to
Section 2.02, 2.03, 2.04 or 4.07 and all amounts required to be deposited in
connection with the substitution of a Qualified Substitute Mortgage Loan
pursuant to Section 2.03 or 2.04; and (v) Any amounts required to be deposited
pursuant to Section 3.07(c) or 3.21. The foregoing requirements for deposit in
the Custodial Account shall be exclusive, it being understood and agreed that,
without limiting the generality of the foregoing, payments on the Mortgage Loans
which are not part of the Trust Fund (consisting of payments in respect of
principal and interest on the Mortgage Loans due on or before the Cut-off Date)
and payments or collections in the nature of prepayment charges or late payment
charges or assumption fees may but need not be deposited by the Master Servicer
in the Custodial Account. In the event any amount not required to be deposited
in the Custodial Account is so deposited, the Master Servicer may at any time
withdraw such amount from the Custodial Account, any provision herein to the
contrary notwithstanding. The Custodial Account may contain funds that belong to
one or more trust funds created for mortgage pass-through certificates of other
series and may contain other funds respecting payments on mortgage loans
belonging to the Master Servicer or serviced or master serviced by it on behalf
of others. Notwithstanding such commingling of funds, the Master Servicer shall
keep records that accurately reflect the funds on deposit in the Custodial
Account that have been identified by it as being attributable to the Mortgage
Loans. With respect to Insurance Proceeds, Liquidation Proceeds, REO Proceeds
and the proceeds of the purchase of any Mortgage Loan pursuant to Sections 2.02,
2.03, 2.04 and 4.07 received in any calendar month, the Master Servicer may
elect to treat such amounts as included in the related Group I or Group II
Available Distribution Amount for the Distribution Date in the month of receipt,
but is not obligated to do so. If the Master Servicer so elects, such amounts
will be deemed to have been received (and any related Realized Loss shall be
deemed to have occurred) on the last day of the month prior to the receipt
thereof.

         (c) The Master Servicer shall use its best efforts to cause the
institution maintaining the Custodial Account to invest the funds in the
Custodial Account attributable to the Mortgage Loans

                                       73

<PAGE>

in Permitted Investments which shall mature not later than the Certificate
Account Deposit Date next following the date of such investment (with the
exception of the Amount Held for Future Distribution) and which shall not be
sold or disposed of prior to their maturities. All income and gain realized from
any such investment shall be for the benefit of the Master Servicer as
additional servicing compensation and shall be subject to its withdrawal or
order from time to time. The amount of any losses incurred in respect of any
such investments attributable to the investment of amounts in respect of the
Mortgage Loans shall be deposited in the Custodial Account by the Master
Servicer out of its own funds immediately as realized.

         (d) The Master Servicer shall give notice to the Trustee and the
Depositor of any change in the location of the Custodial Account and the
location of the Certificate Account prior to the use thereof.

         Section 3.08.     SUBSERVICING ACCOUNTS; SERVICING ACCOUNTS.

         (a) In those cases where a Subservicer is servicing a Mortgage Loan
pursuant to a Subservicing Agreement, the Master Servicer shall cause the
Subservicer, pursuant to the Subservicing Agreement, to establish and maintain
one or more Subservicing Accounts which shall be an Eligible Account or, if such
account is not an Eligible Account, shall generally satisfy the requirements of
the Program Guide and be otherwise acceptable to the Master Servicer, the
Insurer and each Rating Agency. The Subservicer will be required thereby to
deposit into the Subservicing Account on a daily basis all proceeds of Mortgage
Loans received by the Subservicer, less its Subservicing Fees and unreimbursed
advances and expenses, to the extent permitted by the Subservicing Agreement. If
the Subservicing Account is not an Eligible Account, the Master Servicer shall
be deemed to have received such monies upon receipt thereof by the Subservicer.
The Subservicer shall not be required to deposit in the Subservicing Account
payments or collections in the nature of prepayment charges or late charges or
assumption fees. On or before the date specified in the Program Guide, but in no
event later than the Determination Date, the Master Servicer shall cause the
Subservicer, pursuant to the Subservicing Agreement, to remit to the Master
Servicer for deposit in the Custodial Account all funds held in the Subservicing
Account with respect to each Mortgage Loan serviced by such Subservicer that are
required to be remitted to the Master Servicer. The Subservicer will also be
required, pursuant to the Subservicing Agreement, to advance on such scheduled
date of remittance amounts equal to any scheduled monthly installments of
principal and interest less its Subservicing Fees on any Mortgage Loans for
which payment was not received by the Subservicer. This obligation to advance
with respect to each Mortgage Loan will continue up to and including the first
of the month following the date on which the related Mortgaged Property is sold
at a foreclosure sale or is acquired by the Trust Fund by deed in lieu of
foreclosure or otherwise. All such advances received by the Master Servicer
shall be deposited promptly by it in the Custodial Account.

         (b) The Subservicer may also be required, pursuant to the Subservicing
Agreement, to remit to the Master Servicer for deposit in the Custodial Account
interest at the Adjusted Mortgage Rate (or Modified Net Mortgage Rate plus the
rate per annum at which the Servicing Fee and the Certificate Insurer Premium
Modified Rate, if any, accrues in the case of a Modified Mortgage Loan) on any
Curtailment received by such Subservicer in respect of a Mortgage Loan from the
related Mortgagor during any month that is to be applied by the Subservicer to
reduce the unpaid principal

                                       74

<PAGE>

balance of the related Mortgage Loan as of the first day of such month, from the
date of application of such Curtailment to the first day of the following month.
Any amounts paid by a Subservicer pursuant to the preceding sentence shall be
for the benefit of the Master Servicer as additional servicing compensation and
shall be subject to its withdrawal or order from time to time pursuant to
Sections 3.10(a)(iv) and (v).

         (c) In addition to the Custodial Account and the Certificate Account,
the Master Servicer shall for any Nonsubserviced Mortgage Loan, and shall cause
the Subservicers for Subserviced Mortgage Loans to, establish and maintain one
or more Servicing Accounts and deposit and retain therein all collections from
the Mortgagors (or advances from Subservicers) for the payment of taxes,
assessments, hazard insurance premiums, Primary Insurance Policy premiums, if
applicable, or comparable items for the account of the Mortgagors. Each
Servicing Account shall satisfy the requirements for a Subservicing Account and,
to the extent permitted by the Program Guide or as is otherwise acceptable to
the Master Servicer, may also function as a Subservicing Account. Withdrawals of
amounts related to the Mortgage Loans from the Servicing Accounts may be made
only to effect timely payment of taxes, assessments, hazard insurance premiums,
Primary Insurance Policy premiums, if applicable, or comparable items, to
reimburse the Master Servicer or Subservicer out of related collections for any
payments made pursuant to Sections 3.11 (with respect to the Primary Insurance
Policy) and 3.12(a) (with respect to hazard insurance), to refund to any
Mortgagors any sums as may be determined to be overages, to pay interest, if
required, to Mortgagors on balances in the Servicing Account or to clear and
terminate the Servicing Account at the termination of this Agreement in
accordance with Section 9.01 or in accordance with the Program Guide. As part of
its servicing duties, the Master Servicer shall, and the Subservicers will,
pursuant to the Subservicing Agreements, be required to pay to the Mortgagors
interest on funds in this account to the extent required by law.

         (d) The Master Servicer shall advance the payments referred to in the
preceding subsection that are not timely paid by the Mortgagors or advanced by
the Subservicers on the date when the tax, premium or other cost for which such
payment is intended is due, but the Master Servicer shall be required so to
advance only to the extent that such advances, in the good faith judgment of the
Master Servicer, will be recoverable by the Master Servicer out of Insurance
Proceeds, Liquidation Proceeds or otherwise.

         Section 3.09.     ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION
                           REGARDING THE MORTGAGE LOANS.

         In the event that compliance with this Section 3.09 shall make any
Class of Certificates legal for investment by federally insured savings and loan
associations, the Master Servicer shall provide, or cause the Subservicers to
provide, to the Trustee, the Office of Thrift Supervision or the FDIC and the
supervisory agents and examiners thereof access to the documentation regarding
the Mortgage Loans required by applicable regulations of the Office of Thrift
Supervision, such access being afforded without charge but only upon reasonable
request and during normal business hours at the offices designated by the Master
Servicer. The Master Servicer shall permit such representatives to photocopy any
such documentation and shall provide equipment for that purpose at a charge
reasonably approximating the cost of such photocopying to the Master Servicer.

                                       75

<PAGE>

         Section 3.10.     PERMITTED WITHDRAWALS FROM THE CUSTODIAL ACCOUNT.

         (a) The Master Servicer may, from time to time as provided herein, make
withdrawals from the Custodial Account of amounts on deposit therein pursuant to
Section 3.07 that are attributable to the Mortgage Loans for the following
purposes: (i) to make deposits into the Certificate Account in the amounts and
in the manner provided for in Section 4.01; (ii) to reimburse itself or the
related Subservicer for previously unreimbursed advances or expenses made
pursuant to Sections 3.01, 3.08, 3.12(a), 3.14 and 4.04 or otherwise
reimbursable pursuant to the terms of this Agreement, such withdrawal right
being limited to amounts received on particular Mortgage Loans (including, for
this purpose, REO Proceeds, Insurance Proceeds, Liquidation Proceeds and
proceeds from the purchase of a Mortgage Loan pursuant to Section 2.02, 2.03,
2.04 or 4.07) which represent (A) Late Collections of Monthly Payments for which
any such advance was made in the case of Subservicer Advances or Advances
pursuant to Section 4.04 and (B) late recoveries of the payments for which such
advances were made in the case of Servicing Advances; (iii) to pay to itself or
the related Subservicer (if not previously retained by such Subservicer) out of
each payment received by the Master Servicer on account of interest on a
Mortgage Loan as contemplated by Sections 3.14 and 3.16, an amount equal to that
remaining portion of any such payment as to interest (but not in excess of the
Servicing Fee and the Subservicing Fee, if not previously retained) which, when
deducted, will result in the remaining amount of such interest being interest at
a rate per annum equal to the Net Mortgage Rate (or Modified Net Mortgage Rate
in the case of a Modified Mortgage Loan) plus the Certificate Insurer Premium
Modified Rate on the amount specified in the amortization schedule of the
related Mortgage Loan as the principal balance thereof at the beginning of the
period respecting which such interest was paid after giving effect to any
previous Curtailments; (iv) to pay to itself as additional servicing
compensation any interest or investment income earned on funds deposited in the
Custodial Account that it is entitled to withdraw pursuant to Section 3.07(c);
(v) to pay to itself as additional servicing compensation any Foreclosure
Profits, and any amounts remitted by Subservicers as interest in respect of
Curtailments pursuant to Section 3.08(b); (vi) to pay to itself, a Subservicer,
Residential Funding, the Depositor or any other appropriate Person, as the case
may be, with respect to each Mortgage Loan or property acquired in respect
thereof that has been purchased or otherwise transferred pursuant to Section
2.02, 2.03, 2.04, 3.23, 4.07 or 9.01, all amounts received thereon and not
required to be distributed to Certificateholders as of the date on which the
related Stated Principal Balance or Purchase Price is determined; (vii) to
reimburse itself or the related Subservicer for any Nonrecoverable Advance or
Advances in the manner and to the extent provided in subsection (c) below, any
Advance made in connection with a modification of a Mortgage Loan that is in
default or, in the judgment of the Master Servicer, default is reasonably
foreseeable pursuant to Section 3.07(a), to the extent the amount of the Advance
has been added to the outstanding principal balance of the Mortgage Loan; (viii)
to reimburse itself or the Depositor for expenses incurred by and reimbursable
to it or the Depositor pursuant to Section 3.14(c), 6.03, 10.01 or otherwise;
(ix) to reimburse itself for amounts expended by it (a) pursuant to Section 3.14
in good faith in connection with the restoration of property damaged by an
Uninsured Cause, and (b) in connection with the liquidation of a Mortgage Loan
or disposition of an REO Property to the extent not otherwise reimbursed
pursuant to clause (ii) or (viii) above; and (x) to withdraw any amount
deposited in the Custodial Account that was not required to be deposited therein
pursuant to Section 3.07, including any payoff fees or penalties or any other
additional amounts payable to the Master Servicer or Subservicer pursuant to the
terms of the Mortgage Note.

                                       76

<PAGE>

         (b) Since, in connection with withdrawals pursuant to clauses (ii),
(iii), (v) and (vi), the Master Servicer's entitlement thereto is limited to
collections or other recoveries on the related Mortgage Loan, the Master
Servicer shall keep and maintain separate accounting, on a Mortgage Loan by
Mortgage Loan basis, for the purpose of justifying any withdrawal from the
Custodial Account pursuant to such clauses.

         (c) The Master Servicer shall be entitled to reimburse itself or the
related Subservicer for any advance made in respect of a Mortgage Loan that the
Master Servicer determines to be a Nonrecoverable Advance by withdrawal from the
Custodial Account of amounts on deposit therein attributable to the Mortgage
Loans on any Certificate Account Deposit Date succeeding the date of such
determination. Such right of reimbursement in respect of a Nonrecoverable
Advance on any such Certificate Account Deposit Date shall be limited to an
amount not exceeding the portion of such advance previously paid to
Certificateholders (and not theretofore reimbursed to the Master Servicer or the
related Subservicer).

         Section 3.11.     MAINTENANCE OF PRIMARY INSURANCE COVERAGE.

         (a) The Master Servicer shall not take, or permit any Subservicer to
take, any action which would result in noncoverage under any applicable Primary
Insurance Policy of any loss which, but for the actions of the Master Servicer
or Subservicer, would have been covered thereunder. To the extent coverage is
available, the Master Servicer shall keep or cause to be kept in full force and
effect each such Primary Insurance Policy until the principal balance of the
related Mortgage Loan secured by a Mortgaged Property is reduced to 80% or less
of the Appraised Value at origination in the case of such a Mortgage Loan having
a Loan-to-Value Ratio at origination in excess of 80%, provided that such
Primary Insurance Policy was in place as of the Cut-off Date and the Master
Servicer had knowledge of such Primary Insurance Policy. The Master Servicer
shall not cancel or refuse to renew any such Primary Insurance Policy applicable
to a Nonsubserviced Mortgage Loan, or consent to any Subservicer canceling or
refusing to renew any such Primary Insurance Policy applicable to a Mortgage
Loan subserviced by it, that is in effect at the date of the initial issuance of
the Certificates and is required to be kept in force hereunder unless the
replacement Primary Insurance Policy for such canceled or non-renewed policy is
maintained with an insurer whose claims-paying ability is acceptable to each
Rating Agency for mortgage pass-through certificates having a rating equal to or
better than the lower of the then-current rating or the rating assigned to the
Certificates as of the Closing Date by such Rating Agency.

         (b) In connection with its activities as administrator and servicer of
the Mortgage Loans, the Master Servicer agrees to present or to cause the
related Subservicer to present, on behalf of the Master Servicer, the
Subservicer, if any, the Trustee and Certificateholders, claims to the insurer
under any Primary Insurance Policies, in a timely manner in accordance with such
policies, and, in this regard, to take or cause to be taken such reasonable
action as shall be necessary to permit recovery under any Primary Insurance
Policies respecting defaulted Mortgage Loans. Pursuant to Section 3.07, any
Insurance Proceeds collected by or remitted to the Master Servicer under any
Primary Insurance Policies shall be deposited in the Custodial Account, subject
to withdrawal pursuant to Section 3.10.

         Section 3.12.     MAINTENANCE OF FIRE INSURANCE AND OMISSIONS AND
                           FIDELITY COVERAGE.

                                       77

<PAGE>

         (a) The Master Servicer shall cause to be maintained for each Mortgage
Loan (other than a Cooperative Loan) fire insurance with extended coverage in an
amount which is equal to the lesser of the principal balance owing on such
Mortgage Loan (together with the principal balance of any mortgage loan secured
by a lien that is senior to the Mortgage Loan) or 100 percent of the insurable
value of the improvements; PROVIDED, HOWEVER, that such coverage may not be less
than the minimum amount required to fully compensate for any loss or damage on a
replacement cost basis. To the extent it may do so without breaching the related
Subservicing Agreement, the Master Servicer shall replace any Subservicer that
does not cause such insurance, to the extent it is available, to be maintained.
The Master Servicer shall also cause to be maintained on property acquired upon
foreclosure, or deed in lieu of foreclosure, of any Mortgage Loan (other than a
Cooperative Loan), fire insurance with extended coverage in an amount which is
at least equal to the amount necessary to avoid the application of any
co-insurance clause contained in the related hazard insurance policy. Pursuant
to Section 3.07, any amounts collected by the Master Servicer under any such
policies (other than amounts to be applied to the restoration or repair of the
related Mortgaged Property or property thus acquired or amounts released to the
Mortgagor in accordance with the Master Servicer's normal servicing procedures)
shall be deposited in the Custodial Account, subject to withdrawal pursuant to
Section 3.10. Any cost incurred by the Master Servicer in maintaining any such
insurance shall not, for the purpose of calculating monthly distributions to
Certificateholders, be added to the amount owing under the Mortgage Loan,
notwithstanding that the terms of the Mortgage Loan so permit. Such costs shall
be recoverable by the Master Servicer out of related late payments by the
Mortgagor or out of Insurance Proceeds and Liquidation Proceeds to the extent
permitted by Section 3.10. It is understood and agreed that no earthquake or
other additional insurance is to be required of any Mortgagor or maintained on
property acquired in respect of a Mortgage Loan other than pursuant to such
applicable laws and regulations as shall at any time be in force and as shall
require such additional insurance. Whenever the improvements securing a Mortgage
Loan (other than a Cooperative Loan) are located at the time of origination of
such Mortgage Loan in a federally designated special flood hazard area, the
Master Servicer shall cause flood insurance (to the extent available) to be
maintained in respect thereof. Such flood insurance shall be in an amount equal
to the lesser of (i) the amount required to compensate for any loss or damage to
the Mortgaged Property on a replacement cost basis and (ii) the maximum amount
of such insurance available for the related Mortgaged Property under the
national flood insurance program (assuming that the area in which such Mortgaged
Property is located is participating in such program).In the event that the
Master Servicer shall obtain and maintain a blanket fire insurance policy with
extended coverage insuring against hazard losses on all of the Mortgage Loans,
it shall conclusively be deemed to have satisfied its obligations as set forth
in the first sentence of this Section 3.12(a), it being understood and agreed
that such policy may contain a deductible clause, in which case the Master
Servicer shall, in the event that there shall not have been maintained on the
related Mortgaged Property a policy complying with the first sentence of this
Section 3.12(a) and there shall have been a loss which would have been covered
by such policy, deposit in the Certificate Account the amount not otherwise
payable under the blanket policy because of such deductible clause. Any such
deposit by the Master Servicer shall be made on the Certificate Account Deposit
Date next preceding the Distribution Date which occurs in the month following
the month in which payments under any such policy would have been deposited in
the Custodial Account. In connection with its activities as administrator and
servicer of the Mortgage Loans, the Master Servicer agrees to present, on behalf
of itself, the Trustee and Certificateholders, claims under any such blanket
policy.

                                       78

<PAGE>

         (b) The Master Servicer shall obtain and maintain at its own expense
and keep in full force and effect throughout the term of this Agreement a
blanket fidelity bond and an errors and omissions insurance policy covering the
Master Servicer's officers and employees and other persons acting on behalf of
the Master Servicer in connection with its activities under this Agreement. The
amount of coverage shall be at least equal to the coverage that would be
required by Fannie Mae or Freddie Mac, whichever is greater, with respect to the
Master Servicer if the Master Servicer were servicing and administering the
Mortgage Loans for Fannie Mae or Freddie Mac. In the event that any such bond or
policy ceases to be in effect, the Master Servicer shall obtain a comparable
replacement bond or policy from an issuer or insurer, as the case may be,
meeting the requirements, if any, of the Program Guide and acceptable to the
Depositor. Coverage of the Master Servicer under a policy or bond obtained by an
Affiliate of the Master Servicer and providing the coverage required by this
Section 3.12(b) shall satisfy the requirements of this Section 3.12(b).

         Section 3.13.     ENFORCEMENT OF DUE-ON-SALE CLAUSES; ASSUMPTION AND
                           MODIFICATION AGREEMENTS; CERTAIN ASSIGNMENTS.

         (a) When any Mortgaged Property is conveyed by the Mortgagor, the
Master Servicer or Subservicer, to the extent it has knowledge of such
conveyance, shall enforce any due-on-sale clause contained in any Mortgage Note
or Mortgage, to the extent permitted under applicable law and governmental
regulations, but only to the extent that such enforcement will not adversely
affect or jeopardize coverage under any Required Insurance Policy.
Notwithstanding the foregoing: (i) the Master Servicer shall not be deemed to be
in default under this Section 3.13(a) by reason of any transfer or assumption
which the Master Servicer is restricted by law from preventing; and (ii) if the
Master Servicer determines that it is reasonably likely that any Mortgagor will
bring, or if any Mortgagor does bring, legal action to declare invalid or
otherwise avoid enforcement of a due-on- sale clause contained in any Mortgage
Note or Mortgage, the Master Servicer shall not be required to enforce the
due-on-sale clause or to contest such action.

         (b) Subject to the Master Servicer's duty to enforce any due-on-sale
clause to the extent set forth in Section 3.13(a), in any case in which a
Mortgaged Property is to be conveyed to a Person by a Mortgagor, and such Person
is to enter into an assumption or modification agreement or supplement to the
Mortgage Note or Mortgage which requires the signature of the Trustee, or if an
instrument of release signed by the Trustee is required releasing the Mortgagor
from liability on the Mortgage Loan, the Master Servicer is authorized, subject
to the requirements of the sentence next following, to execute and deliver, on
behalf of the Trustee, the assumption agreement with the Person to whom the
Mortgaged Property is to be conveyed and such modification agreement or
supplement to the Mortgage Note or Mortgage or other instruments as are
reasonable or necessary to carry out the terms of the Mortgage Note or Mortgage
or otherwise to comply with any applicable laws regarding assumptions or the
transfer of the Mortgaged Property to such Person; PROVIDED, HOWEVER, none of
such terms and requirements shall both constitute a "significant modification"
effecting an exchange or reissuance of such Mortgage Loan under the Code (or
final, temporary or proposed Treasury regulations promulgated thereunder) and
cause any of REMIC I, REMIC II, REMIC III or REMIC IV to fail to qualify as
REMICs under the Code or the imposition of any tax on "prohibited transactions"
or "contributions" after the startup date under the REMIC Provisions. The Master
Servicer shall execute and deliver such documents only if it reasonably
determines that (i) its execution and delivery thereof will not conflict with or
violate any terms of this Agreement

                                       79

<PAGE>

or cause the unpaid balance and interest on the Mortgage Loan to be
uncollectible in whole or in part, (ii) any required consents of insurers under
any Required Insurance Policies have been obtained and (iii) subsequent to the
closing of the transaction involving the assumption or transfer (A) the Mortgage
Loan will continue to be secured by a first mortgage lien (or junior lien of the
same priority in relation to any senior mortgage loan, with respect to any
Mortgage Loan secured by a junior Mortgage) pursuant to the terms of the
Mortgage, (B) such transaction will not adversely affect the coverage under any
Required Insurance Policies, (C) the Mortgage Loan will fully amortize over the
remaining term thereof, (D) no material term of the Mortgage Loan (including the
interest rate on the Mortgage Loan) will be altered nor will the term of the
Mortgage Loan be changed and (E) if the seller/transferor of the Mortgaged
Property is to be released from liability on the Mortgage Loan, the
buyer/transferee of the Mortgaged Property would be qualified to assume the
Mortgage Loan based on generally comparable credit quality and such release will
not (based on the Master Servicer's or Subservicer's good faith determination)
adversely affect the collectability of the Mortgage Loan. Upon receipt of
appropriate instructions from the Master Servicer in accordance with the
foregoing, the Trustee shall execute any necessary instruments for such
assumption or substitution of liability as directed by the Master Servicer. Upon
the closing of the transactions contemplated by such documents, the Master
Servicer shall cause the originals or true and correct copies of the assumption
agreement, the release (if any), or the modification or supplement to the
Mortgage Note or Mortgage to be delivered to the Trustee or the Custodian and
deposited with the Mortgage File for such Mortgage Loan. Any fee collected by
the Master Servicer or such related Subservicer for entering into an assumption
or substitution of liability agreement will be retained by the Master Servicer
or such Subservicer as additional servicing compensation.

         (c) The Master Servicer or the related Subservicer, as the case may be,
shall be entitled to approve a request from a Mortgagor for a partial release of
the related Mortgaged Property, the granting of an easement thereon in favor of
another Person, any alteration or demolition of the related Mortgaged Property
(or, with respect to a Cooperative Loan, the related Cooperative Apartment)
without any right of reimbursement or other similar matters if it has
determined, exercising its good faith business judgment in the same manner as it
would if it were the owner of the related Mortgage Loan, that the security for,
and the timely and full collectability of, such Mortgage Loan would not be
adversely affected thereby and that each of REMIC I, REMIC II, REMIC III or
REMIC IV would continue to qualify as a REMIC under the Code as a result thereof
and that no tax on "prohibited transactions" or "contributions" after the
startup day would be imposed on any of REMIC I, REMIC II, REMIC III or REMIC IV
as a result thereof. Any fee collected by the Master Servicer or the related
Subservicer for processing such a request will be retained by the Master
Servicer or such Subservicer as additional servicing compensation.

         (d) Subject to any other applicable terms and conditions of this
Agreement, the Trustee and Master Servicer shall be entitled to approve an
assignment in lieu of satisfaction with respect to any Mortgage Loan, provided
the obligee with respect to such Mortgage Loan following such proposed
assignment provides the Trustee and Master Servicer with a "Lender Certification
for Assignment of Mortgage Loan" in the form attached hereto as Exhibit M, in
form and substance satisfactory to the Trustee and Master Servicer, providing
the following: (i) that the Mortgage Loan is secured by Mortgaged Property
located in a jurisdiction in which an assignment in lieu of satisfaction is
required to preserve lien priority, minimize or avoid mortgage recording taxes
or otherwise comply with, or facilitate a refinancing under, the laws of such
jurisdiction; (ii) that the

                                       80

<PAGE>

substance of the assignment is, and is intended to be, a refinancing of such
Mortgage Loan and that the form of the transaction is solely to comply with, or
facilitate the transaction under, such local laws; (iii) that the Mortgage Loan
following the proposed assignment will have a rate of interest at least 0.25
percent below or above the rate of interest on such Mortgage Loan prior to such
proposed assignment; and (iv) that such assignment is at the request of the
borrower under the related Mortgage Loan. Upon approval of an assignment in lieu
of satisfaction with respect to any Mortgage Loan, the Master Servicer shall
receive cash in an amount equal to the unpaid principal balance of and accrued
interest on such Mortgage Loan and the Master Servicer shall treat such amount
as a Principal Prepayment in Full with respect to such Mortgage Loan for all
purposes hereof.

         Section 3.14.     REALIZATION UPON DEFAULTED MORTGAGE LOANS.

         (a) The Master Servicer shall foreclose upon or otherwise comparably
convert (which may include an REO Acquisition) the ownership of properties
securing such of the Mortgage Loans as come into and continue in default
(including a default with respect to a required payment of an Arrearage) and as
to which no satisfactory arrangements can be made for collection of delinquent
payments pursuant to Section 3.07. Alternatively, the Master Servicer may take
other actions in respect of a defaulted Mortgage Loan, which may include (i)
accepting a short sale (a payoff of the Mortgage Loan for an amount less than
the total amount contractually owed in order to facilitate a sale of the
Mortgaged Property by the Mortgagor) or permitting a short refinancing (a payoff
of the Mortgage Loan for an amount less than the total amount contractually owed
in order to facilitate refinancing transactions by the Mortgagor not involving a
sale of the Mortgaged Property), (ii) arranging for a repayment plan or (iii)
agreeing to a modification in accordance with Section 3.07. In connection with
such foreclosure or other conversion or action, the Master Servicer shall,
consistent with Section 3.11, follow such practices and procedures as it shall
deem necessary or advisable, as shall be normal and usual in its general
mortgage servicing activities and as shall be required or permitted by the
Program Guide; provided that the Master Servicer shall not be liable in any
respect hereunder if the Master Servicer is acting in connection with any such
foreclosure or other conversion or action in a manner that is consistent with
the provisions of this Agreement. The Master Servicer, however, shall not be
required to expend its own funds or incur other reimbursable charges in
connection with any foreclosure, or attempted foreclosure which is not
completed, or towards the correction of any default on a related senior mortgage
loan, or towards the restoration of any property unless it shall determine (i)
that such restoration and/or foreclosure will increase the proceeds of
liquidation of the Mortgage Loan to Holders of Certificates of one or more
Classes or the Insurer after reimbursement to itself for such expenses or
charges and (ii) that such expenses and charges will be recoverable to it
through Liquidation Proceeds, Insurance Proceeds, or REO Proceeds (respecting
which it shall have priority for purposes of withdrawals from the Custodial
Account pursuant to Section 3.10, whether or not such expenses and charges are
actually recoverable from related Liquidation Proceeds, Insurance Proceeds or
REO Proceeds). In the event of such a determination by the Master Servicer
pursuant to this Section 3.14(a), the Master Servicer shall be entitled to
reimbursement of its funds so expended pursuant to Section 3.10. In addition,
the Master Servicer may pursue any remedies that may be available in connection
with a breach of a representation and warranty with respect to any such Mortgage
Loan in accordance with Sections 2.03 and 2.04. However, the Master Servicer is
not required to continue to pursue both foreclosure (or similar remedies) with
respect to the Mortgage Loans and remedies in connection with a breach of a
representation and warranty if the Master Servicer determines in its reasonable
discretion that

                                       81

<PAGE>

one such remedy is more likely to result in a greater recovery as to the
Mortgage Loan. Upon the occurrence of a Cash Liquidation or REO Disposition,
following the deposit in the Custodial Account of all Insurance Proceeds,
Liquidation Proceeds and other payments and recoveries referred to in the
definition of "Cash Liquidation" or "REO Disposition," as applicable, upon
receipt by the Trustee of written notification of such deposit signed by a
Servicing Officer, the Trustee or any Custodian, as the case may be, shall
release to the Master Servicer the related Mortgage File and the Trustee shall
execute and deliver such instruments of transfer or assignment prepared by the
Master Servicer, in each case without recourse, as shall be necessary to vest in
the Master Servicer or its designee, as the case may be, the related Mortgage
Loan, and thereafter such Mortgage Loan shall not be part of the Trust Fund.
Notwithstanding the foregoing or any other provision of this Agreement, in the
Master Servicer's sole discretion with respect to any defaulted Mortgage Loan or
REO Property as to either of the following provisions, (i) a Cash Liquidation or
REO Disposition may be deemed to have occurred if substantially all amounts
expected by the Master Servicer to be received in connection with the related
defaulted Mortgage Loan or REO Property have been received, and (ii) for
purposes of determining the amount of any Liquidation Proceeds, Insurance
Proceeds, REO Proceeds or other unscheduled collections or the amount of any
Realized Loss, the Master Servicer may take into account minimal amounts of
additional receipts expected to be received or any estimated additional
liquidation expenses expected to be incurred in connection with the related
defaulted Mortgage Loan or REO Property.

         (b) In the event that title to any Mortgaged Property is acquired by
the Trust Fund as an REO Property by foreclosure or by deed in lieu of
foreclosure, the deed or certificate of sale shall be issued to the Trustee or
to its nominee on behalf of Certificateholders. Notwithstanding any such
acquisition of title and cancellation of the related Mortgage Loan, such REO
Property shall (except as otherwise expressly provided herein) be considered to
be an Outstanding Mortgage Loan held in the Trust Fund until such time as the
REO Property shall be sold. Consistent with the foregoing for purposes of all
calculations hereunder so long as such REO Property shall be considered to be an
Outstanding Mortgage Loan it shall be assumed that, notwithstanding that the
indebtedness evidenced by the related Mortgage Note shall have been discharged,
such Mortgage Note and the related amortization schedule in effect at the time
of any such acquisition of title (after giving effect to any previous
Curtailments and before any adjustment thereto by reason of any bankruptcy or
similar proceeding or any moratorium or similar waiver or grace period) remain
in effect.

         (c) In the event that the Trust Fund acquires any REO Property as
aforesaid or otherwise in connection with a default or imminent default on a
Mortgage Loan, the Master Servicer on behalf of the Trust Fund shall dispose of
such REO Property within three full years after the taxable year of its
acquisition by the Trust Fund for purposes of Section 860G(a)(8) of the Code (or
such shorter period as may be necessary under applicable state (including any
state in which such property is located) law to maintain the status of each of
REMIC I, REMIC II, REMIC III or REMIC IV as a REMIC under applicable state law
and avoid taxes resulting from such property failing to be foreclosure property
under applicable state law) or, at the expense of the Trust Fund, request, more
than 60 days before the day on which such grace period would otherwise expire,
an extension of such grace period unless the Master Servicer obtains for the
Trustee and the Insurer an Opinion of Counsel, addressed to the Trustee, the
Insurer and the Master Servicer, to the effect that the holding by the Trust
Fund of such REO Property subsequent to such period will not result in the
imposition of taxes on "prohibited transactions" as defined in Section 860F of
the Code or cause any of REMIC

                                       82

<PAGE>

I, REMIC II, REMIC III or REMIC IV to fail to qualify as a REMIC (for federal
(or any applicable State or local) income tax purposes) at any time that any
Certificates are outstanding, in which case the Trust Fund may continue to hold
such REO Property (subject to any conditions contained in such Opinion of
Counsel). The Master Servicer shall be entitled to be reimbursed from the
Custodial Account for any costs incurred in obtaining such Opinion of Counsel,
as provided in Section 3.10. Notwithstanding any other provision of this
Agreement, no REO Property acquired by the Trust Fund shall be rented (or
allowed to continue to be rented) or otherwise used by or on behalf of the Trust
Fund in such a manner or pursuant to any terms that would (i) cause such REO
Property to fail to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code or (ii) subject REMIC I, REMIC II, REMIC III or
REMIC IV to the imposition of any federal income taxes on the income earned from
such REO Property, including any taxes imposed by reason of Section 860G(c) of
the Code, unless the Master Servicer has agreed to indemnify and hold harmless
the Trust Fund with respect to the imposition of any such taxes.

         (d) The proceeds of any Cash Liquidation, REO Disposition or purchase
or repurchase of any Mortgage Loan pursuant to the terms of this Agreement, as
well as any recovery resulting from a collection of Liquidation Proceeds,
Insurance Proceeds or REO Proceeds, will be applied in the following order of
priority: FIRST, to reimburse the Master Servicer or the related Subservicer in
accordance with Section 3.10(a)(ii); SECOND, to the Certificateholders to the
extent of accrued and unpaid interest on the Mortgage Loan, and any related REO
Imputed Interest, at the Net Mortgage Rate (or the Modified Net Mortgage Rate in
the case of a Modified Mortgage Loan) (less Deferred Interest, if any), to the
Due Date in the related Due Period prior to the Distribution Date on which such
amounts are to be distributed; THIRD, to the Certificateholders as a recovery of
principal on the Mortgage Loan (or REO Property) (provided that if any such
Class of Certificates to which such Realized Loss was allocated is no longer
outstanding, such subsequent recovery shall be distributed to the persons who
were the Holders of such Class of Certificates when it was retired), other than
with respect to any Arrearage; FOURTH, to the Master Servicer (or the owner of
the Arrearage) in respect of any Arrearage; FIFTH, to all Servicing Fees and
Subservicing Fees payable therefrom (and the Master Servicer and the Subservicer
shall have no claims for any deficiencies with respect to such fees which result
from the foregoing allocation); SIXTH, to the Insurer for reimbursement for any
payments made pursuant to the Policy to the extent not reimbursed pursuant to
Section 4.02(c)(v) and (vi) or 4.02(d)(v) and (vi); and SEVENTH, to Foreclosure
Profits.

         (e) Notwithstanding the foregoing paragraphs of this Section 3.14, in
the event that a Foreclosure Restricted Loan goes into foreclosure, if acquiring
title to the related Mortgaged Property by foreclosure or by deed in lieu of
foreclosure would cause the adjusted basis (for federal income tax purposes) of
the Mortgaged Properties underlying the Foreclosure Restricted Loans in Loan
Group I or Loan Group II that are currently owned by REMIC I or REMIC II,
respectively, after foreclosure (along with any other assets owned by REMIC I or
REMIC II, respectively, other than "qualified mortgages" and "permitted
investments" within the meaning of Section 860G of the Code) to exceed 0.75% of
the adjusted basis of the assets in Loan Group I or Loan Group II, respectively,
the Master Servicer shall not be permitted to acquire title to such Mortgaged
Property on behalf of REMIC I or REMIC II, respectively. Instead, the Master
Servicer shall dispose of the Mortgage Loan for cash in the foreclosure sale. In
addition, if the Master Servicer determines that following a distribution on any
Distribution Date the adjusted bases of the Mortgaged Properties underlying the
Foreclosure Restricted Loans in foreclosure (along with any other assets owned
by REMIC I or

                                       83

<PAGE>

REMIC II, as the case may be, other than "qualified mortgages" and "permitted
investments" within the meaning of Section 860G of the Code) exceed 1.0% of the
adjusted bases of the assets of REMIC I or REMIC II, as the case may be,
immediately after the distribution, then prior to such Distribution Date, the
Master Servicer shall dispose of enough of such Mortgaged Properties in
foreclosure, for cash, so that the adjusted bases of such Mortgaged Properties
in foreclosure (along with any other assets owned by REMIC I or REMIC II, as the
case may be, other than "qualified mortgages" and "permitted investments" within
the meaning of Section 860G of the Code) will be less than 1.0% of the adjusted
bases of the assets of REMIC I or REMIC II, as the case may be. In either event,
the Master Servicer is permitted to acquire (for its own account and not on
behalf of the Trust) the Mortgaged Property at the foreclosure sale for an
amount not less than the greater of: (i) the highest amount bid by any other
person at the foreclosure sale, or (ii) the estimated fair value of the
Mortgaged Property, as determined by the Master Servicer in good faith.

         Section 3.15.     TRUSTEE TO COOPERATE; RELEASE OF MORTGAGE FILES.

         (a) Upon becoming aware of the payment in full of any Mortgage Loan, or
upon the receipt by the Master Servicer of a notification that payment in full
will be escrowed in a manner customary for such purposes, the Master Servicer
will immediately notify the Trustee (if it holds the related Mortgage File) or
the Custodian by a certification of a Servicing Officer (which certification
shall include a statement to the effect that all amounts received or to be
received in connection with such payment which are required to be deposited in
the Custodial Account pursuant to Section 3.07 have been or will be so
deposited), substantially in one of the forms attached hereto as Exhibit G
requesting delivery to it of the Mortgage File. Upon receipt of such
certification and request, the Trustee shall promptly release, or cause the
Custodian to release, the related Mortgage File to the Master Servicer. The
Master Servicer is authorized to execute and deliver to the Mortgagor the
request for reconveyance, deed of reconveyance or release or satisfaction of
mortgage or such instrument releasing the lien of the Mortgage, together with
the Mortgage Note with, as appropriate, written evidence of cancellation thereon
and to cause the removal from the registration on the MERS(R) System of such
Mortgage and to execute and deliver, on behalf of the Trustee and the
Certificateholders or any of them, any and all instruments of satisfaction or
cancellation or of partial or full release, including any applicable UCC
termination statements. No expenses incurred in connection with any instrument
of satisfaction or deed of reconveyance shall be chargeable to the Custodial
Account or the Certificate Account.

         (b) From time to time as is appropriate for the servicing or
foreclosure of any Mortgage Loan, the Master Servicer shall deliver to the
Custodian, with a copy to the Trustee, a certificate of a Servicing Officer
substantially in one of the forms attached as Exhibit G hereto, requesting that
possession of all, or any document constituting part of, the Mortgage File be
released to the Master Servicer and certifying as to the reason for such release
and that such release will not invalidate any insurance coverage provided in
respect of the Mortgage Loan under any Required Insurance Policy. Upon receipt
of the foregoing, the Trustee shall deliver, or cause the Custodian to deliver,
the Mortgage File or any document therein to the Master Servicer. The Master
Servicer shall cause each Mortgage File or any document therein so released to
be returned to the Trustee, or the Custodian as agent for the Trustee when the
need therefor by the Master Servicer no longer exists, unless (i) the Mortgage
Loan has been liquidated and the Liquidation Proceeds relating to the Mortgage
Loan have been deposited in the Custodial Account or (ii) the Mortgage File or
such document has been

                                       84

<PAGE>

delivered directly or through a Subservicer to an attorney, or to a public
trustee or other public official as required by law, for purposes of initiating
or pursuing legal action or other proceedings for the foreclosure of the
Mortgaged Property either judicially or non-judicially, and the Master Servicer
has delivered directly or through a Subservicer to the Trustee a certificate of
a Servicing Officer certifying as to the name and address of the Person to which
such Mortgage File or such document was delivered and the purpose or purposes of
such delivery. In the event of the liquidation of a Mortgage Loan, the Trustee
shall deliver the Request for Release with respect thereto to the Master
Servicer upon deposit of the related Liquidation Proceeds in the Custodial
Account.

         (c) The Trustee or the Master Servicer on the Trustee's behalf shall
execute and deliver to the Master Servicer, if necessary, any court pleadings,
requests for trustee's sale or other documents necessary to the foreclosure or
trustee's sale in respect of a Mortgaged Property or to any legal action brought
to obtain judgment against any Mortgagor on the Mortgage Note or Mortgage or to
obtain a deficiency judgment, or to enforce any other remedies or rights
provided by the Mortgage Note or Mortgage or otherwise available at law or in
equity. Together with such documents or pleadings (if signed by the Trustee),
the Master Servicer shall deliver to the Trustee a certificate of a Servicing
Officer requesting that such pleadings or documents be executed by the Trustee
and certifying as to the reason such documents or pleadings are required and
that the execution and delivery thereof by the Trustee will not invalidate any
insurance coverage under any Required Insurance Policy or invalidate or
otherwise affect the lien of the Mortgage, except for the termination of such a
lien upon completion of the foreclosure or trustee's sale.

         Section 3.16.     SERVICING AND OTHER COMPENSATION; COMPENSATING
                           INTEREST.

         (a) The Master Servicer, as compensation for its activities hereunder,
shall be entitled to receive on each Distribution Date the amounts provided for
by clauses (iii), (iv), (v) and (vi) of Section 3.10(a), subject to clause (e)
below. The amount of servicing compensation provided for in such clauses shall
be accounted for on a Mortgage Loan-by-Mortgage Loan basis. In the event that
Liquidation Proceeds, Insurance Proceeds and REO Proceeds (net of amounts
reimbursable therefrom pursuant to Section 3.10(a)(ii)) in respect of a Cash
Liquidation or REO Disposition exceed the unpaid principal balance of such
Mortgage Loan plus unpaid interest accrued thereon (including REO Imputed
Interest) at a per annum rate equal to the related Net Mortgage Rate (or the
Modified Net Mortgage Rate in the case of a Modified Mortgage Loan), the Master
Servicer shall be entitled to retain therefrom and to pay to itself and/or the
related Subservicer, any Foreclosure Profits and any Servicing Fee or
Subservicing Fee considered to be accrued but unpaid. If the portion of a
Monthly Payment on a Simple Interest Loan that is applied to interest is less
than the portion of such Monthly Payment that would have been applied to
interest if such payment had been received on the related Due Date, the
aggregate Servicing Fee payable on the related Distribution Date to the Master
Servicer in respect of all of the Mortgage Loans shall be reduced by such
difference. If the portion of a Monthly Payment on a Simple Interest Loan that
is applied to interest is more than the portion of such Monthly Payment that
would have been applied to interest if such payment had been received on the
related Due Date, the aggregate Servicing Fee payable on the related
Distribution Date to the Master Servicer in respect of all of the Mortgage Loans
shall be increased by such difference.

                                       85

<PAGE>

         (b) Additional servicing compensation in the form of prepayment
charges, assumption fees, late payment charges, investment income on amounts in
the Custodial Account or the Certificate Account or otherwise shall be retained
by the Master Servicer or the Subservicer to the extent provided herein, subject
to clause (e) below.

         (c) The Master Servicer shall be required to pay, or cause to be paid,
all expenses incurred by it in connection with its servicing activities
hereunder (including payment of premiums for the Primary Insurance Policies, if
any, to the extent such premiums are not required to be paid by the related
Mortgagors, and the fees and expenses of the Trustee and any Custodian) and
shall not be entitled to reimbursement therefor except as specifically provided
in Sections 3.10 and 3.14.

         (d) The Master Servicer's right to receive servicing compensation may
not be transferred in whole or in part except in connection with the transfer of
all of its responsibilities and obligations of the Master Servicer under this
Agreement.

         (e) Notwithstanding clauses (a) and (b) above, the amount of servicing
compensation that the Master Servicer shall be entitled to receive for its
activities hereunder for the period ending on each Distribution Date shall be
reduced (but not below zero) by an amount equal to Compensating Interest (if
any) for such Distribution Date. Such reduction shall be applied during such
period as follows: FIRST, to any Servicing Fee or Subservicing Fee to which the
Master Servicer is entitled pursuant to Section 3.10(a)(iii); SECOND, to any
income or gain realized from any investment of funds held in the Custodial
Account or the Certificate Account to which the Master Servicer is entitled
pursuant to Sections 3.07(c) or 4.01(b), respectively; and THIRD, to any amounts
of servicing compensation to which the Master Servicer is entitled pursuant to
Section 3.10(a)(v) or (vi). In making such reduction, the Master Servicer shall
not withdraw from the Custodial Account any such amount representing all or a
portion of the Servicing Fee to which it is entitled pursuant to Section
3.10(a)(iii); (ii) shall not withdraw from the Custodial Account or Certificate
Account any such amount to which it is entitled pursuant to Section 3.07(c) or
4.01(b) and (iii) shall not withdraw from the Custodial Account any such amount
of servicing compensation to which it is entitled pursuant to Section 3.10(a)(v)
or (vi). With respect to any Distribution Date, Compensating Interest derived
from Loan Group I shall be used on such Distribution Date (i) to cover any
Prepayment Interest Shortfalls on the Group I Loans and (ii) to cover any
Prepayment Interest Shortfalls on the Group II Loans, but only to the extent not
covered by Compensating Interest derived from Loan Group II. With respect to any
Distribution Date, Compensating Interest derived from Loan Group II shall be
used on such Distribution Date (i) to cover any Prepayment Interest Shortfalls
on the Group II Loans and (ii) to cover any Prepayment Interest Shortfalls on
the Group I Loans, but only to the extent not covered by Compensating Interest
derived from Loan Group I.

         Section 3.17.     REPORTS TO THE TRUSTEE AND THE DEPOSITOR.

         Not later than fifteen days after each Distribution Date, the Master
Servicer shall forward to the Trustee and the Depositor a statement, certified
by a Servicing Officer, setting forth the status of the Custodial Account as of
the close of business on such Distribution Date as it relates to the Mortgage
Loans and showing, for the period covered by such statement, the aggregate of
deposits in or withdrawals from the Custodial Account in respect of the Mortgage
Loans for each category of deposit specified in Section 3.07 and each category
of withdrawal specified in Section 3.10.

                                       86

<PAGE>

         Section 3.18.     ANNUAL STATEMENT AS TO COMPLIANCE.

         The Master Servicer will deliver to the Depositor, the Trustee and the
Insurer on or before March 31 of each year, beginning with the first March 31
that occurs at least six months after the Cut-off Date, an Officers' Certificate
stating, as to each signer thereof, that (i) a review of the activities of the
Master Servicer during the preceding calendar year related to its servicing of
mortgage loans and of its performance under the pooling and servicing
agreements, including this Agreement, has been made under such officers'
supervision, (ii) to the best of such officers' knowledge, based on such review,
the Master Servicer has complied in all material respects with the minimum
servicing standards set forth in the Uniform Single Attestation Program for
Mortgage Bankers and has fulfilled all of its material obligations in all
material respects throughout such year, or, if there has been material
noncompliance with such servicing standards or a default in the fulfillment in
all material respects of any such obligation relating to this Agreement, such
statement shall include a description of such noncompliance or specify each such
default, as the case may be, known to such officer and the nature and status
thereof and (iii) to the best of such officers' knowledge, each Subservicer has
complied in all material respects with the minimum servicing standards set forth
in the Uniform Single Attestation Program for Mortgage Bankers and has fulfilled
all of its material obligations under its Subservicing Agreement in all material
respects throughout such year, or if there has been material noncompliance with
such servicing standards or a material default in the fulfillment of such
obligations relating to this Agreement, specifying such statement shall include
a description of such noncompliance or specify each such default, as the case
may be, known to such officer and the nature and status thereof.

         Section 3.19.     ANNUAL INDEPENDENT PUBLIC ACCOUNTANTS' SERVICING
                           REPORT.

         On or before March 31 of each year, beginning with the first March 31
that occurs at least six months after the Cut-off Date, the Master Servicer at
its expense shall cause a firm of independent public accountants which shall be
members of the American Institute of Certified Public Accountants to furnish a
report to the Depositor, the Insurer and the Trustee stating its opinion that,
on the basis of an examination conducted by such firm substantially in
accordance with standards established by the American Institute of Certified
Public Accountants, the assertions made pursuant to Section 3.18 regarding
compliance with the minimum servicing standards set forth in the Uniform Single
Attestation Program for Mortgage Bankers during the preceding calendar year are
fairly stated in all material respects, subject to such exceptions and other
qualifications that, in the opinion of such firm, such accounting standards
require it to report. In rendering such statement, such firm may rely, as to
matters relating to the direct servicing of mortgage loans by Subservicers, upon
comparable statements for examinations conducted by independent public
accountants substantially in accordance with standards established by the
American Institute of Certified Public Accountants (rendered within one year of
such statement) with respect to such Subservicers.

         Section 3.20.     RIGHT OF THE DEPOSITOR IN RESPECT OF THE MASTER
                           SERVICER.

         The Master Servicer shall afford the Depositor, upon reasonable notice,
during normal business hours access to all records maintained by the Master
Servicer in respect of its rights and obligations hereunder and access to
officers of the Master Servicer responsible for such obligations. Upon request,
the Master Servicer shall furnish the Depositor with its most recent financial

                                       87

<PAGE>

statements and such other information as the Master Servicer possesses regarding
its business, affairs, property and condition, financial or otherwise. The
Master Servicer shall also cooperate with all reasonable requests for
information including, but not limited to, notices, tapes and copies of files,
regarding itself, the Mortgage Loans or the Certificates from any Person or
Persons identified by the Depositor or Residential Funding. The Insurer hereby
is so identified. The Depositor may, but is not obligated to perform, or cause a
designee to perform, any defaulted obligation of the Master Servicer hereunder
or exercise the rights of the Master Servicer hereunder; provided that the
Master Servicer shall not be relieved of any of its obligations hereunder by
virtue of such performance by the Depositor or its designee. The Depositor shall
not have the responsibility or liability for any action or failure to act by the
Master Servicer and is not obligated to supervise the performance of the Master
Servicer under this Agreement or otherwise.

                                       88

<PAGE>

                                   ARTICLE IV

                         PAYMENTS TO CERTIFICATEHOLDERS

         Section 4.01.     CERTIFICATE ACCOUNT.

         (a) The Master Servicer acting as agent of the Trustee shall establish
and maintain a Certificate Account in which the Master Servicer shall cause to
be deposited on behalf of the Trustee on or before 2:00 P.M. New York time on
each Certificate Account Deposit Date by wire transfer of immediately available
funds an amount equal to the sum of (i) any Advance for the immediately
succeeding Distribution Date, (ii) any amount required to be deposited in the
Certificate Account pursuant to Section 3.12(a), (iii) any amount required to be
deposited in the Certificate Account pursuant to Section 3.16(e) or Section
4.07, (iv) any amount to be deposited in the Reserve Fund pursuant to Section
4.09, (v) any amount required to be paid pursuant to Section 9.01, (vi) an
amount equal to the Certificate Insurer Premium payable on such Distribution
Date and (vii) all other amounts constituting the Group I or Group II Available
Distribution Amount for the immediately succeeding Distribution Date. In
addition, as and to the extent required pursuant to Section 4.08(b), the Trustee
shall withdraw from the Insurance Account and deposit into the Certificate
Account the amount necessary to pay the Insured Amount on each Distribution Date
to the extent received from the Insurer.

         (b) On each Distribution Date, prior to making any other distributions
referred to in Section 4.02 herein, the Trustee shall withdraw from the
Certificate Account and pay to the Insurer, by wire transfer of immediately
available funds to the Insurer Account, the Certificate Insurer Premium for such
Distribution Date. The Trustee shall deposit any amounts received pursuant to
the Policy into the Certificate Account. Any such amounts shall be distributed
on the immediately following Distribution Date as part of the Group I or Group
II Available Distribution Amount, as applicable.

         (c) The Trustee shall, upon written request from the Master Servicer,
invest or cause the institution maintaining the Certificate Account to invest
the funds in the Certificate Account in Permitted Investments designated in the
name of the Trustee for the benefit of the Certificateholders and the Insurer,
which shall mature not later than the Business Day next preceding the
Distribution Date next following the date of such investment (except that (i)
any investment in the institution with which the Certificate Account is
maintained may mature on such Distribution Date and (ii) any other investment
may mature on such Distribution Date if the Trustee shall advance funds on such
Distribution Date to the Certificate Account in the amount payable on such
investment on such Distribution Date, pending receipt thereof to the extent
necessary to make distributions on the Certificates) and shall not be sold or
disposed of prior to maturity. All income and gain realized from any such
investment shall be for the benefit of the Master Servicer and shall be subject
to its withdrawal or order from time to time. The amount of any losses incurred
in respect of any such investments shall be deposited in the Certificate Account
by the Master Servicer out of its own funds immediately as realized.

         Section 4.02.     DISTRIBUTIONS.

                                       89

<PAGE>

         (a) On each Distribution Date, the Trustee (or the Paying Agent on
behalf of the Trustee) shall allocate and distribute the Principal Distribution
Amount for such date to the interests issued in respect of REMIC I, REMIC II,
REMIC III and REMIC IV as specified in this Section.

         (b) (1) On each Distribution Date, the following amounts, in the
following order of priority, shall be distributed by REMIC I to REMIC III on
account of the REMIC I Regular Interests:

                  (i) to the extent of the Group I Available Distribution
         Amounts, FIRST, to the Holders of REMIC I Regular Interest LT-A-2 and
         REMIC I Regular Interest LT-A-3, in an amount equal to

                           (A) the Uncertificated Accrued Interest for such
                           Distribution Date, plus

                           (B) any amounts in respect thereof remaining unpaid
                           from previous Distribution Dates and

         SECOND, to Holders of REMIC I Regular Interest LT-A-1 in an amount
         equal to

                           (A) the Uncertificated Accrued Interest for such
                           Distribution Date, plus

                           (B) any amounts in respect thereof remaining unpaid
                           from previous Distribution Dates; and

                  (ii) to the Holders of REMIC I Regular Interests, in an amount
         equal to the remainder of the Group I Available Distribution Amount for
         such Distribution Date after the distributions made pursuant to clause
         (i) above, allocated in the following order of priority:

                           (A) to the Holders of REMIC I Regular Interest
                           LT-A-1, until the Uncertificated Principal Balance of
                           REMIC I Regular Interest LT-A-1 is reduced to zero;

                           (B) to the Holders of REMIC I Regular Interest
                           LT-A-2, until the Uncertificated Principal Balance of
                           REMIC I Regular Interest LT-A-2 is reduced to zero;

                           (C) to the Holders of REMIC I Regular Interest
                           LT-A-3, until the Uncertificated Principal Balance of
                           REMIC I Regular Interest LT-A-3, is reduced to zero;
                           and

                           (D) any remaining amount to the Holders of the Class
                           R-I Certificates.

                  (2) On each Distribution Date, the following amounts, in the
following order of priority, shall be distributed by REMIC II to REMIC III on
account of the REMIC II Regular Interests:

                                       90

<PAGE>

                  (i) to the extent of the Group II Available Distribution
         Amounts, to the Holders of REMIC II Regular Interest LT-B, in an amount
         equal to (A) the related Uncertificated Accrued Interest for such
         Distribution Date, plus (B) any amounts in respect thereof remaining
         unpaid from previous Distribution Dates; and

                  (ii) to the Holders of REMIC II Regular Interest LT-B, in an
         amount equal to the remainder of the Group II Available Distribution
         Amount for such Distribution Date after the distributions made pursuant
         to clause (i) above, allocated in the following order of priority:

                           (A) to the Holders REMIC II Regular Interest LT-B,
                           until the Uncertificated Principal Balance of REMIC
                           II Regular Interest LT-B is reduced to zero; and

                           (B) any remaining amount to the Holders of the Class
                           R-II Certificates.

                  (3) On each Distribution Date, the following amounts, in the
following order of priority, shall be distributed by REMIC III to REMIC IV on
account of the REMIC III Regular Interests:

                  (i) to the extent of the Group I Available Distribution
         Amount, FIRST, to the Holders of REMIC III Regular Interest MT-I-IO, in
         an amount equal to (A) the related Uncertificated Accrued Interest for
         such Distribution Date, plus (B) any amounts in respect thereof
         remaining unpaid from previous Distribution Dates, and SECOND, to the
         Holders of REMIC III Regular Interest MT-I-1, REMIC III Regular
         Interest MT-I-2, REMIC III Regular Interest MT-I-3, REMIC III Regular
         Interest MT-I-4, REMIC III Regular Interest MT-I-5, REMIC III Regular
         Interest MT-I-6 and REMIC III Regular Interest MT-I-7, pro rata, in an
         amount equal to (A) the related Uncertificated Accrued Interest for
         such Distribution Date, plus (B) any amounts in respect thereof
         remaining unpaid from previous Distribution Dates. Amounts payable as
         Uncertificated Accrued Interest in respect of REMIC III Regular
         Interest MT-I-7 shall be reduced when the REMIC III Group I
         Overcollateralization Amount is less than the REMIC III Group I
         Required Overcollateralization Amount, by the lesser of (x) the amount
         of such difference and (y) the REMIC III Group I Regular Interest
         MT-I-7 Maximum Interest Deferral Amount , and such amount will be
         payable to the Holders of REMIC III Regular Interest MT-I-1, REMIC III
         Regular Interest MT-I-2, REMIC III Regular Interest MT-I-3, REMIC III
         Regular Interest MT-I-4, REMIC III Regular Interest MT-I-5 and REMIC
         III Regular Interest MT-I-6 in the same proportion as the Group I
         Overcollateralization Increase Amount is allocated to the Class A-I-1
         Certificates, Class A-I-2 Certificates, Class A-I-3 Certificates, Class
         A-I-4 Certificates and Class A-I-5 Certificates, respectively; and

                  (ii) on each Distribution Date, to the Holders of REMIC III
         Group I Regular Interests (other than REMIC III Regular Interest
         MT-I-IO), in an amount equal to the remainder of the Group I Available
         Distribution Amount after the distributions made pursuant to clause (i)
         above, allocated as follows (except as provided below): (A) to the
         Holders of the REMIC III Regular Interest MT-I-1, 98.00% of such
         remainder until the Uncertificated Principal Balance of such REMIC III
         Regular Interest is reduced to zero; (B)

                                       91

<PAGE>

         to the Holders of the REMIC III Regular Interest MT-I-2, MT-I-3,
         MT-I-4, MT-I-5 and MT- I-6, 1.00% of such remainder, in the same
         proportion as principal payments are allocated to the Class A-I-1
         Certificates, Class A-I-2 Certificates, Class A-I-3 Certificates, Class
         A-I-4 Certificates and Class A-I-5 Certificates, respectively; (C) to
         the Holders of the REMIC III Regular Interest MT-I-7, 1.00% of such
         remainder; and (D) any remaining amounts to the Holders of the Class
         R-III Certificates; PROVIDED, HOWEVER, that 98.00% and 2.00% of any
         principal payments that are attributable to an Overcollateralization
         Reduction Amount shall be allocated to Holders of the REMIC III Regular
         Interest MT-I-1 and REMIC III Regular Interest MT-I-7, respectively.

                  (iii) to the extent of the Group II Available Distribution
         Amount, to the Holders of REMIC III Regular Interest MT-II-1, REMIC III
         Regular Interest MT-II-2, and REMIC III Regular Interest MT-II-3, pro
         rata, in an amount equal to (A) the related Uncertificated Accrued
         Interest for such Distribution Date, plus (B) any amounts in respect
         thereof remaining unpaid from previous Distribution Dates. Amounts
         payable as Uncertificated Accrued Interest in respect of REMIC III
         Regular Interest MT-II-3 shall be reduced when the REMIC III Group II
         Overcollateralization Amount is less than the REMIC III Group II
         Required Overcollateralization Amount, by the lesser of (x) the amount
         of such difference and (y) the REMIC III Group II Regular Interest
         MT-II-3 Maximum Interest Deferral Amount , and such amount will be
         payable to the Holders of REMIC III Regular Interest MT- II-2 in an
         amount equal to the amount of Group II Overcollateralization Increase
         Amount allocated to the Class A-II Certificates, respectively; and (iv)
         on each Distribution Date, to the Holders of REMIC III Group II Regular
         Interests, in an amount equal to the remainder of the Group II
         Available Distribution Amount after the distributions made pursuant to
         clause (iii) above, allocated as follows (except as provided below):
         (A) to the Holders of the REMIC III Regular Interest MT-II-1, 98.00% of
         such remainder until the Uncertificated Principal Balance of such REMIC
         III Regular Interest is reduced to zero; (B) to the Holders of the
         REMIC III Regular Interest MT-II-2, 1.00% of such remainder, (C) to the
         Holders of the REMIC III Regular Interest MT-II-3, 1.00% of such
         remainder; and (D) any remaining amounts to the Holders of the Class
         R-III Certificates; PROVIDED, HOWEVER, that 98.00% and 2.00% of any
         principal payments that are attributable to an Overcollateralization
         Reduction Amount shall be allocated to Holders of the REMIC III Regular
         Interest MT-II-1 and REMIC III Regular Interest MT-II-3, respectively.

                  (4) Notwithstanding the distributions on the REMIC Regular
Interests described in this Section 4.02(b), distribution of funds from the
Certificate Account shall be made only in accordance with Section 4.02(c) and
(d).

         (c) On each Distribution Date (x) the Master Servicer on behalf of the
Trustee or (y) the Paying Agent appointed by the Trustee, shall distribute to
each Certificateholder of record on the next preceding Record Date (other than
as provided in Section 9.01 respecting the final distribution) either in
immediately available funds (by wire transfer or otherwise) to the account of
such Certificateholder at a bank or other entity having appropriate facilities
therefor, if such Certificateholder has so notified the Master Servicer or the
Paying Agent, as the case may be, or, if such Certificateholder has not so
notified the Master Servicer or the Paying Agent by the Record Date, by check
mailed to such Certificateholder at the address of such Holder appearing in the

                                       92

<PAGE>

Certificate Register such Certificateholder's share (which share with respect to
each Class of Certificates, shall be based on the aggregate of the Percentage
Interests represented by Certificates of the applicable Class held by such
Holder of the following amounts), in the following order of priority, in each
case to the extent of the Group I Available Distribution Amount:

                  (i) to the Class A-I Certificateholders, Accrued Certificate
         Interest payable on such Certificates with respect to such Distribution
         Date, plus any Accrued Certificate Interest remaining unpaid from any
         prior Distribution Date, less any Prepayment Interest Shortfalls on the
         Group I Loans, to the extent not covered by Compensating Interest
         pursuant to Section 3.16 (the "Group I Interest Distribution Amount"),
         with such amount allocated among the Class A-I Certificateholders on a
         pro rata basis;

                  (ii) to the Class A-I Certificateholders (other than the Class
         A-I-IO Certificateholders), the lesser of (a) the excess of (i) the
         Group I Available Distribution Amount over (ii) the Group I Interest
         Distribution Amount and (b) the Group I Principal Distribution Amount
         (other than with respect to clauses (iv) and (v) thereof), in the order
         described in Section 4.02(e), until the aggregate Certificate Principal
         Balance of the Class A-I Certificates has been reduced to zero;

                  (iii) to the Class A-I Certificateholders (other than the
         Class A-I-IO Certificateholders), from the Group I Available
         Distribution Amount remaining after the foregoing distributions (such
         amount, the "Group I Excess Cash Flow"), an amount equal to the
         Realized Losses on the Group I Loans during the immediately preceding
         Due Period, applied to reduce the Certificate Principal Balances of the
         Class A-I Certificates, in the order described in Section 4.02(e),
         until the aggregate Certificate Principal Balance of the Class A-I
         Certificates has been reduced to zero;

                  (iv) to the Class A-II Certificateholders, from the amount, if
         any, of the Group I Available Distribution Amount remaining after the
         foregoing distributions, an amount equal to the Realized Losses on the
         Group II Loans during the immediately preceding Due Period to the
         extent not covered by the Group II Excess Cash Flow, applied to reduce
         the Certificate Principal Balance of the Class A-II Certificates, until
         the Certificate Principal Balance of the Class A-II Certificates has
         been reduced to zero;

                  (v) to the Insurer, from the amount, if any, of the Group I
         Available Distribution Amount remaining after the foregoing
         distributions, in respect of any Group I Cumulative Insurance Payments;

                  (vi) to the Insurer, from the amount, if any, of the Group I
         Available Distribution Amount remaining after the foregoing
         distributions, in respect of any Group II Cumulative Insurance
         Payments, to the extent not covered by the Group II Excess Cash Flow;

                  (vii) to the Class A-II Certificateholders, from the amount,
         if any, of the Group I Available Distribution Amount remaining after
         the foregoing distributions, the Group II Overcollateralization
         Increase Amount for such Distribution Date, in reduction of the
         Certificate Principal Balance thereof, until the Certificate Principal
         Balance of the Class A-II

                                       93

<PAGE>

         Certificates has been reduced to zero, but only to the extent the
         Certificate Principal Balance of the Class A-II Certificates
         immediately prior to such Distribution Date exceeded the aggregate
         Stated Principal Balance of the Group II Loans at the end of the
         immediately preceding Due Period and to the extent not covered by the
         Group II Excess Cash Flow;

                  (viii) except on the first two Distribution Dates, to the
         Class A-I Certificateholders (other than the Class A-I-IO
         Certificateholders), from the amount, if any, of the Group I Available
         Distribution Amount remaining after the foregoing distributions, the
         Group I Overcollateralization Increase Amount for such Distribution
         Date, in the order described in Section 4.02(e), until the aggregate
         Certificate Principal Balance of such Class A-I Certificates has been
         reduced to zero;

                  (ix) except on the first two Distribution Dates, to the Class
         A-II Certificateholders, from the amount, if any, of the Group I
         Available Distribution Amount remaining after the foregoing
         distributions, the Group II Overcollateralization Increase Amount for
         such Distribution Date to the extent not covered by the Group II Excess
         Cash Flow for such Distribution Date, in reduction of the Certificate
         Principal Balance thereof, until the Certificate Principal Balance of
         the Class A-II Certificates has been reduced to zero;

                  (x) to the Class A-I Certificateholders from the amount, if
         any, of the Group I Available Distribution Amount remaining after the
         foregoing distributions, the amount of any Prepayment Interest
         Shortfalls allocated thereto with respect to the Group I Loans, to the
         extent not covered by Compensating Interest on such Distribution Date;

                  (xi) to the Class A-II Certificateholders from the amount, if
         any, of the Group I Available Distribution Amount remaining after the
         foregoing distributions, the amount of any Prepayment Interest
         Shortfalls allocated thereto with respect to the Group II Loans, to the
         extent not covered by Compensating Interest and any Group II Excess
         Cash Flow on such Distribution Date;

                  (xii) to the Class A-I Certificateholders from the amount, if
         any, of the Group I Available Distribution Amount remaining after the
         foregoing distributions, the amount of any Prepayment Interest
         Shortfalls allocated thereto remaining unpaid from prior Distribution
         Dates together with interest thereon;

                  (xiii) to the Class A-II Certificateholders from the amount,
         if any, of the Group I Available Distribution Amount remaining after
         the foregoing distributions, the amount of any Prepayment Interest
         Shortfalls allocated thereto remaining unpaid from prior Distribution
         Dates together with interest thereon, to the extent not covered by any
         Group II Excess Cash Flow on such Distribution Date;

                  (xiv) to make payments, from amounts otherwise payable to the
         Class SB-I Certificates (but in no event more than the Accrued
         Certificate Interest on such Class), (i) FIRST, to the Reserve Fund to
         pay to the Class A-II Certificates the amount of any Basis Risk
         Shortfall Carry-Forward Amount on such Certificate to the extent not
         covered by payments

                                       94

<PAGE>

         pursuant to Section 4.02(d)(xiv), and (ii) SECOND, to maintain a
         balance in the Reserve Fund equal to the Reserve Fund Deposit;

                  (xv) to the Class SB-I Certificates, from the amount, if any,
         of the Group I Available Distribution Amount remaining after the
         foregoing distributions, Accrued Certificate Interest thereon and the
         amount of any Group I Overcollateralization Reduction Amount for such
         Distribution Date; and

                  (xvi) to the related Class R Certificateholders, the balance,
         if any, of the Group I Available Distribution Amount.

         (d) On each Distribution Date (x) the Master Servicer on behalf of the
Trustee or (y) the Paying Agent appointed by the Trustee, shall distribute to
each Certificateholder of record on the next preceding Record Date (other than
as provided in Section 9.01 respecting the final distribution) either in
immediately available funds (by wire transfer or otherwise) to the account of
such Certificateholder at a bank or other entity having appropriate facilities
therefor, if such Certificateholder has so notified the Master Servicer or the
Paying Agent, as the case may be, or, if such Certificateholder has not so
notified the Master Servicer or the Paying Agent by the Record Date, by check
mailed to such Certificateholder at the address of such Holder appearing in the
Certificate Register such Certificateholder's share (which share with respect to
each Class of Certificates, shall be based on the aggregate of the Percentage
Interests represented by Certificates of the applicable Class held by such
Holder of the following amounts, in the following order of priority, subject to
the provisions of Section 4.02(e)), in each case to the extent of the Group II
Available Distribution Amount:

                  (i) to the Class A-II Certificateholders, Accrued Certificate
         Interest payable on such Certificates with respect to such Distribution
         Date, plus any Accrued Certificate Interest remaining unpaid from any
         prior Distribution Date, less any Prepayment Interest Shortfalls on the
         Group II Loans, to the extent not covered by Compensating Interest
         pursuant to Section 3.16 (the "Group II Interest Distribution Amount");

                  (ii) to the Class A-II Certificateholders, the lesser of (a)
         the excess of (i) the Group II Available Distribution Amount over (ii)
         the Group II Interest Distribution Amount and (b) the Group II
         Principal Distribution Amount (other than with respect to clauses (iv)
         and (v) thereof), until the Certificate Principal Balance of the Class
         A-II Certificates has been reduced to zero;

                  (iii) to the Class A-II Certificateholders, from the amount,
         if any, of the Group II Available Distribution Amount remaining after
         the foregoing distributions (such amount, the "Group II Excess Cash
         Flow") an amount equal to the Realized Losses on the Group II Loans
         during the immediately preceding Due Period, applied to reduce the
         Certificate Principal Balance of the Class A-II Certificates, until the
         Certificate Principal Balance of the Class A- II Certificates has been
         reduced to zero;

                  (iv) to the Class A-I Certificateholders (other than the Class
         A-I-IO Certificateholders), from the amount, if any, of the Group II
         Available Distribution Amount

                                       95

<PAGE>

         remaining after the foregoing distributions an amount equal to the
         Realized Losses on the Group I Loans during the immediately preceding
         Due Period to the extent not covered by the Group I Excess Cash Flow,
         applied to reduce the Certificate Principal Balances of the Class A-I
         Certificates, in the order described in Section 4.02(e), until the
         aggregate Certificate Principal Balance of the Class A-I Certificates
         has been reduced to zero;

                  (v) to the Insurer, from the amount, if any, of the Group II
         Available Distribution Amount remaining after the foregoing
         distributions, in respect of any Group II Cumulative Insurance
         Payments;

                  (vi) to the Insurer, from the amount, if any, of the Group II
         Available Distribution Amount remaining after the foregoing
         distributions, in respect of any Group I Cumulative Insurance Payments,
         to the extent not covered by the Group I Excess Cash Flow;

                  (vii) to the Class A-I Certificateholders (other than the
         Class A-I-IO Certificateholders), from the amount, if any, of the Group
         II Available Distribution Amount remaining after the foregoing
         distributions, the Group I Overcollateralization Increase Amount for
         such Distribution Date, in reduction of the Certificate Principal
         Balance thereof, until the aggregate Certificate Principal Balance of
         the Class A-I Certificates has been reduced to zero, but only to the
         extent the aggregate Certificate Principal Balance of the Class A-I
         Certificates immediately prior to such Distribution Date exceeded the
         aggregate Stated Principal Balance of the Group I Loans at the end of
         the immediately preceding Due Period and to the extent not covered by
         the Group I Excess Cash Flow, in the order described in Section
         4.02(e);

                  (viii) except on the first two Distribution Dates, to the
         Class A-II Certificateholders, from the amount, if any, of the Group II
         Available Distribution Amount remaining after the foregoing
         distributions, the Group II Overcollateralization Increase Amount for
         such Distribution Date, in reduction of the Certificate Principal
         Balance of the Class A-II Certificates, until the aggregate Certificate
         Principal Balance of the Class A-II Certificates has been reduced to
         zero;

                  (ix) except on the first two Distribution Dates, to the Class
         A-I Certificateholders (other than the Class A-I-IO
         Certificateholders), from the amount, if any, of the Group II Available
         Distribution Amount remaining after the foregoing distributions, the
         Group I Overcollateralization Increase Amount for such Distribution
         Date to the extent not covered by the Group I Excess Cash Flow for such
         Distribution Date, in reduction of the Certificate Principal Balance
         thereof, until the Certificate Principal Balance of the Class A-I
         Certificates has been reduced to zero;

                  (x) to the Class A-II Certificateholders from the amount, if
         any, of the Group II Available Distribution Amount remaining after the
         foregoing distributions, the amount of any Prepayment Interest
         Shortfalls allocated thereto with respect to the Group II Loans, to the
         extent not covered by Compensating Interest on such Distribution Date;

                                       96

<PAGE>

                  (xi) to the Class A-I Certificateholders from the amount, if
         any, of the Group II Available Distribution Amount remaining after the
         foregoing distributions, the amount of any Prepayment Interest
         Shortfalls allocated thereto with respect to the Group I Loans, to the
         extent not covered by Compensating Interest and any Group I Excess Cash
         Flow on such Distribution Date;

                  (xii) to the Class A-II Certificateholders from the amount, if
         any, of the Group II Available Distribution Amount remaining after the
         foregoing distributions, the amount of any Prepayment Interest
         Shortfalls allocated thereto remaining unpaid from prior Distribution
         Dates together with interest thereon;

                  (xiii) to the Class A-I Certificateholders from the amount, if
         any, of the Group II Available Distribution Amount remaining after the
         foregoing distributions, the amount of any Prepayment Interest
         Shortfalls allocated thereto remaining unpaid from prior Distribution
         Dates together with interest thereon, to the extent not covered by any
         Group I Excess Cash Flow on such Distribution Date;

                  (xiv) to make payments, from amounts otherwise payable to the
         Class SB-II Certificates (but in no event more than the Accrued
         Certificate Interest on such Class), (i) FIRST, to the Reserve Fund to
         pay to the Class A-II Certificates, the amount of any Basis Risk
         Shortfall Carry-Forward Amount on such Certificate, and (ii) SECOND, to
         maintain a balance in the Reserve Fund equal to the Reserve Fund
         Deposit;

                  (xv) to the Class SB-II Certificates, from the amount, if any,
         of the Group II Available Distribution Amount remaining after the
         foregoing distributions, Accrued Certificate Interest thereon and the
         amount of any Group II Overcollateralization Reduction Amount for such
         Distribution Date; and

                  (xvi) to the related Class R Certificateholders, the balance,
         if any, of the Group II Available Distribution Amount.

         (e) Any amounts payable to the Class A-I Certificateholders (other than
the Class A-I-IO Certificateholders) pursuant to 4.02(c)(ii), (iii) and (viii)
and Section 4.02(d)(iv) and (vii) above shall be allocated as follows:

                  (i) FIRST, to the to the Class A-I-5 Certificates, an amount
         equal to the Class A-I-5 Lockout Distribution Amount for that
         Distribution Date, until the Certificate Principal Balance of the Class
         A-I-5 Certificates has been reduced to zero; and

                  (ii) SECOND, to the Class A-I-1, Class A-I-2, Class A-I-3,
         Class A-I-4 and Class A-I-5 Certificates, in that order, in each case
         until the Certificate Principal Balance thereof has been reduced to
         zero.

         (f) Within five Business Days before the related Distribution Date, the
Master Servicer shall notify the Trustee of the amounts, if any, payable to the
Insurer pursuant to Section 4.02(c)(v) and (vi) and (d)(v) and (vi).

                                       97

<PAGE>

         (g) In addition to the foregoing distributions, with respect to any
Mortgage Loan that was previously the subject of a Cash Liquidation or an REO
Disposition that resulted in a Realized Loss, in the event that within two years
of the date on which such Realized Loss was determined to have occurred the
Master Servicer receives amounts which the Master Servicer reasonably believes
to represent subsequent recoveries (net of any related liquidation expenses), or
determines that it holds surplus amounts previously reserved to cover estimated
expenses specifically related to such Mortgage Loan (including, but not limited
to, recoveries (net of any related liquidation expenses) in respect of the
representations and warranties made by the related Seller pursuant to the
applicable Seller's Agreement), the Master Servicer shall distribute such
amounts to the Class or Classes to which such Realized Loss was allocated (with
the amounts to be distributed allocated among such Classes in the same
proportions as such Realized Loss was allocated), and within each such Class to
the Certificateholders of record as of the Record Date immediately preceding the
date of such distribution (or if such Class of Certificates is no longer
outstanding, to the Certificateholders of record at the time that such Realized
Loss was allocated); provided that no such distribution to any Class of
Certificates of subsequent recoveries related to a Mortgage Loan shall exceed,
either individually or in the aggregate and together with any other amounts paid
in reimbursement therefor, the amount of the related Realized Loss that was
allocated to such Class of Certificates. For the purposes of this Section
4.02(g) any allocation of a Realized Loss to Group I or Group II Excess Cash
Flow will be treated as an allocation of a Realized Loss to the Class A-I or
Class A-II Certificates, as applicable. Notwithstanding the foregoing, to the
extent that the Master Servicer receives recoveries with respect to Realized
Losses which were allocated to the related Class A Certificates and which were
paid by the Insurer pursuant to the Policy and not previously reimbursed
pursuant to Section 4.02(c)(v) and (vi) or (d)(v) and (vi), such recoveries
shall be paid directly to the Insurer and applied to reduce the Group I or Group
II Cumulative Insurance Payments then due to the Insurer prior to any payment of
such amounts to any current Certificateholder or any previous Certificateholder.
Any amounts to be so distributed shall not be remitted to or distributed from
the Trust Fund, and shall constitute subsequent recoveries with respect to
Mortgage Loans that are no longer assets of the Trust Fund.

         (h) Each distribution with respect to a Book-Entry Certificate shall be
paid to the Depository, as Holder thereof, and the Depository shall be
responsible for crediting the amount of such distribution to the accounts of its
Depository Participants in accordance with its normal procedures. Each
Depository Participant shall be responsible for disbursing such distribution to
the Certificate Owners that it represents and to each indirect participating
brokerage firm (a "brokerage firm" or "indirect participating firm") for which
it acts as agent. Each brokerage firm shall be responsible for disbursing funds
to the Certificate Owners that it represents. None of the Trustee, the
Certificate Registrar, the Depositor or the Master Servicer shall have any
responsibility therefor except as otherwise provided by this Agreement or
applicable law.

         (i) Except as otherwise provided in Section 9.01, if the Master
Servicer anticipates that a final distribution with respect to any Class of
Certificates will be made on the next Distribution Date, the Master Servicer
shall, no later than the Determination Date in the month of such final
distribution, notify the Trustee and the Trustee shall, no later than two (2)
Business Days after such Determination Date, mail on such date to each Holder of
such Class of Certificates a notice to the effect that: (i) the Trustee
anticipates that the final distribution with respect to such Class of
Certificates will be made on such Distribution Date but only upon presentation
and surrender of such

                                       98

<PAGE>

Certificates at the office of the Trustee or as otherwise specified therein, and
(ii) no interest shall accrue on such Certificates from and after the end of the
prior calendar month. In the event that Certificateholders required to surrender
their Certificates pursuant to Section 9.01(c) do not surrender their
Certificates for final cancellation, the Trustee shall cause funds distributable
with respect to such Certificates to be withdrawn from the Certificate Account
and credited to a separate escrow account for the benefit of such
Certificateholders as provided in Section 9.01(d).

         (j) To the extent on any Distribution Date the Group II Available
Distribution Amount is less than Accrued Certificate Interest on the Class A-II
Certificates on such Distribution Date (without regard to clause (iii) of the
definition thereof) and Deferred Interest exists on such Distribution Date, the
lesser of such excess and the amount of Deferred Interest shall result in a
reduction in Accrued Certificate Interest on the Class A-II Certificates and an
increase in the Certificate Principal Balance of the Class A-II Certificates.

         Section 4.03.     STATEMENTS TO CERTIFICATEHOLDERS.

         (a) Concurrently with each distribution charged to the Certificate
Account and with respect to each Distribution Date the Master Servicer shall
forward to the Trustee and the Trustee shall forward by mail or otherwise make
available electronically to each Holder, the Insurer and the Depositor a
statement setting forth the following information as to each Class of
Certificates, in each case to the extent applicable:

                  (i) (A) the amount of such distribution to the
         Certificateholders of such Class applied to reduce the Certificate
         Principal Balance thereof, and (B) the aggregate amount included
         therein representing Principal Prepayments;

                  (ii) the amount of such distribution to Holders of such Class
         of Certificates allocable to interest;

                  (iii) if the distribution to the Holders of such Class of
         Certificates is less than the full amount that would be distributable
         to such Holders if there were sufficient funds available therefor, the
         amount of the shortfall;

                  (iv) the amount of any Advance by the Master Servicer with
         respect to the Group I Loans and Group II Loans pursuant to Section
         4.04;

                  (v) the number of Group I and Group II Loans and the Stated
         Principal Balance after giving effect to the distribution of principal
         on such Distribution Date;

                  (vi) the aggregate Certificate Principal Balance or Notional
         Amount, as applicable, of each Class of the Certificates, after giving
         effect to the amounts distributed on such Distribution Date, separately
         identifying any reduction thereof due to Realized Losses other than
         pursuant to an actual distribution of principal;

                  (vii) on the basis of the most recent reports furnished to it
         by Subservicers, the number and aggregate principal balances of Group I
         Loans and Group II Loans that are

                                       99

<PAGE>

         Delinquent (A) one month, (B) two months and (C) three or more months
         and the number and aggregate principal balance of Group I Loans and
         Group II Loans that are in foreclosure;

                  (viii) the number, aggregate principal balance and book value
         of any REO Properties;

                  (ix) the aggregate Accrued Certificate Interest remaining
         unpaid, if any, for each Class of Certificates, after giving effect to
         the distribution made on such Distribution Date;

                  (x) the aggregate amount of Realized Losses for such
         Distribution Date and the aggregate amount of Realized Losses on the
         Group I Loans and Group II Loans incurred since the Cut-off Date;

                  (xi) the Group I and Group II Special Hazard Amount, Group I
         and Group II Fraud Loss Amount and Group I and Group II Bankruptcy
         Amount as of the close of business on such Distribution Date and a
         description of any change in the calculation of such amounts;

                  (xii) the amount of any Insured Amount paid on such
         Distribution Date, the amount of any reimbursement payment made to the
         Insurer on such Distribution Date pursuant to Section 4.02(c)(v) and
         (vi) and 4.02(d)(v) and (vi) and the amount of Group I and Group II
         Cumulative Insurance Payments after giving effect to any such Insured
         Amount or any such reimbursement payment to the Insurer;

                  (xiii) the Pass-Through Rate on each Class of Certificates,
         the Group I Weighted Average Net Mortgage Rate, Group I Weighted
         Average Actual/360 Net Mortgage Rate and the Group II Weighted Average
         Actual/360 Net Mortgage Rate;

                  (xiv) the weighted average of the Maximum Net Mortgage Rates
         on the Group I Loans and Group II Loans;

                  (xv) the Basis Risk Shortfall, Basis Risk Shortfall
         Carry-Forward Amount and Group I and Group II Prepayment Interest
         Shortfalls;

                  (xvi) the Group I and Group II Overcollateralization Amount
         and the Group I and Group II Required Overcollateralization Amount
         following such Distribution Date;

                  (xvii) the number and aggregate principal balance of Group I
         Loans and Group II Loans repurchased under Section 4.07;

                  (xviii) the aggregate amount of Deferred Interest added to the
         Stated Principal Balance of the Group II Loans;

                  (xix) the aggregate amount of any recoveries on previously
         foreclosed loans from Residential Funding due to a breach of
         representation or warranty;

                                       100

<PAGE>

                  (xx) the weighted average remaining term to maturity of the
         Group I Loans and Group II Loans after giving effect to the amounts
         distributed on such Distribution Date;

                  (xxi) the weighted average Mortgage Rates of the Group I Loans
         and Group II Loans after giving effect to the amounts distributed on
         such Distribution Date;

                  (xxii) the aggregate of any deposits to and withdrawals from
         the Reserve Fund for such Distribution Date and the remaining amount on
         deposit in the Reserve Fund after such deposits and withdrawals; and

                  (xxiii) the current aggregate Rolling Six-Month Delinquency
         Ratio and the current Twelve-Month Loss Amount.

         In the case of information furnished pursuant to clauses (i) and (ii)
above, the amounts shall be expressed as a dollar amount per Certificate with a
$1,000 denomination. In addition to the statement provided to the Trustee as set
forth in this Section 4.03(a), the Master Servicer shall provide to any manager
of a trust fund consisting of some or all of the Certificates, upon reasonable
request, such additional information as is reasonably obtainable by the Master
Servicer at no additional expense to the Master Servicer.

         (b) Within a reasonable period of time after the end of each calendar
year, the Master Servicer shall prepare, or cause to be prepared, and the
Trustee shall forward, or cause to be forwarded, to each Person who at any time
during the calendar year was the Holder of a Certificate, other than a Class R
Certificate, a statement containing the information set forth in clauses (i) and
(ii) of subsection (a) above aggregated for such calendar year or applicable
portion thereof during which such Person was a Certificateholder. Such
obligation of the Master Servicer and Trustee shall be deemed to have been
satisfied to the extent that substantially comparable information shall be
provided by the Master Servicer and Trustee pursuant to any requirements of the
Code.

         (c) As soon as reasonably practicable, upon the written request of any
Certificateholder, the Master Servicer shall provide the requesting
Certificateholder with such information as is necessary and appropriate, in the
Master Servicer's sole discretion, for purposes of satisfying applicable
reporting requirements under Rule 144A.

         Section 4.04.     DISTRIBUTION OF REPORTS TO THE TRUSTEE AND THE
                           DEPOSITOR; ADVANCES BY THE MASTER SERVICER.

         (a) Prior to the close of business on the Business Day next succeeding
each Determination Date, the Master Servicer shall furnish a written statement
(which may be in a mutually agreeable electronic format) to the Trustee, the
Insurer, any Paying Agent and the Depositor (the information in such statement
to be made available to Certificateholders by the Master Servicer on request)
(provided that the Master Servicer will use its best efforts to deliver such
written statement not later than 12:00 p.m. New York time on the second Business
Day prior to the Distribution Date) setting forth (i) the Group I or Group II
Available Distribution Amounts, (ii) the amounts required to be withdrawn from
the Custodial Account and deposited into the Certificate Account on the
immediately succeeding Certificate Account Deposit Date pursuant to clause (iii)
of Section 4.01(a),

                                       101

<PAGE>

(iii) the amounts required to be withdrawn from and deposited into the Reserve
Fund pursuant to Section 4.09, (iv) the Certificate Insurer Premium and, if the
Master Servicer determines that a Deficiency Amount exists for such Distribution
Date, the amount necessary to complete the notice in the form of Exhibit A to
the Policy (the "Notice"), (v) the amount of Prepayment Interest Shortfalls,
Basis Risk Shortfalls and Basis Risk Shortfall Carry-Forward Amounts, and (vi)
to the extent required, a report detailing the Stated Principal Balance,
Mortgage Rate, Modified Mortgage Rate, remaining term to maturity and Monthly
Payment for any Modified Mortgage Loan pursuant to Section 3.13. The
determination by the Master Servicer of such amounts shall, in the absence of
obvious error, be presumptively deemed to be correct for all purposes hereunder
and the Trustee shall be protected in relying upon the same without any
independent check or verification.

         (b) On or before 2:00 P.M. New York time on each Certificate Account
Deposit Date, the Master Servicer shall either (i) deposit in the Certificate
Account from its own funds, or funds received therefor from the Subservicers, an
amount equal to the Advances to be made by the Master Servicer in respect of the
related Distribution Date, which shall be in an aggregate amount equal to the
sum of (A) the aggregate amount of Monthly Payments other than Balloon Payments
(with each interest portion thereof adjusted to a per annum rate equal to the
Net Mortgage Rate plus the Certificate Insurer Premium Modified Rate, if
applicable), less the amount of any related Servicing Modifications, Deferred
Interest, if any, Debt Service Reductions or reductions in the amount of
interest collectable from the Mortgagor pursuant to the Relief Act or similar
legislation or regulations then in effect, on the Outstanding Mortgage Loans as
of the related Due Date in the related Due Period, which Monthly Payments were
due during the related Due Period and not received as of the close of business
as of the related Determination Date; provided that no Advance shall be made if
it would be a Nonrecoverable Advance and (B) with respect to each Balloon Loan
delinquent in respect of its Balloon Payment as of the close of business on the
related Determination Date, an amount equal to the excess, if any, of interest
on the unpaid principal balance thereof (with each interest portion thereof
adjusted to a per annum rate equal to the Net Mortgage Rate plus the Certificate
Insurer Premium Modified Rate, if applicable), over any payments of interest
(with each interest portion thereof adjusted to a per annum rate equal to the
Net Mortgage Rate) received from the related Mortgagor as of the close of
business on the related Determination Date and allocable to the Due Date during
the related Due Period for each month until such Balloon Loan is finally
liquidated, (ii) withdraw from amounts on deposit in the Custodial Account and
deposit in the Certificate Account all or a portion of the Amount Held for
Future Distribution in discharge of any such Advance, or (iii) make advances in
the form of any combination of (i) and (ii) aggregating the amount of such
Advance. Any portion of the Amount Held for Future Distribution so used shall be
replaced by the Master Servicer by deposit in the Certificate Account on or
before 11:00 A.M. New York time on any future Certificate Account Deposit Date
to the extent that funds attributable to the Mortgage Loans that are available
in the Custodial Account for deposit in the Certificate Account on such
Certificate Account Deposit Date shall be less than payments to
Certificateholders required to be made on the following Distribution Date. The
Master Servicer shall be entitled to use any Advance made by a Subservicer as
described in Section 3.07(b) that has been deposited in the Custodial Account on
or before such Distribution Date as part of the Advance made by the Master
Servicer pursuant to this Section 4.04.The determination by the Master Servicer
that it has made a Nonrecoverable Advance or that any proposed Advance, if made,
would constitute a Nonrecoverable Advance, shall be evidenced by a certificate
of a Servicing Officer delivered to the Depositor, the Insurer and the Trustee.
In the event that the Master Servicer determines as of the Business Day

                                       102

<PAGE>

preceding any Certificate Account Deposit Date that it will be unable to deposit
in the Certificate Account an amount equal to the Advance required to be made
for the immediately succeeding Distribution Date, it shall give notice to the
Trustee and the Insurer of its inability to advance (such notice may be given by
telecopy), not later than 3:00 P.M., New York time, on such Business Day,
specifying the portion of such amount that it will be unable to deposit. Not
later than 3:00 P.M., New York time, on the Certificate Account Deposit Date the
Trustee shall, unless by 12:00 Noon, New York time, on such day the Trustee
shall have been notified in writing (by telecopy) that the Master Servicer shall
have directly or indirectly deposited in the Certificate Account such portion of
the amount of the Advance as to which the Master Servicer shall have given
notice pursuant to the preceding sentence, pursuant to Section 7.01, (a)
terminate all of the rights and obligations of the Master Servicer under this
Agreement in accordance with Section 7.01 and (b) assume the rights and
obligations of the Master Servicer hereunder, including the obligation to
deposit in the Certificate Account an amount equal to the Advance for the
immediately succeeding Distribution Date. The Trustee shall deposit all funds it
receives pursuant to this Section 4.04 into the Certificate Account.

         Section 4.05.     ALLOCATION OF REALIZED LOSSES.

         (a) Prior to each Distribution Date, the Master Servicer shall
determine the total amount of Realized Losses, if any, that resulted from any
Cash Liquidation, Servicing Modifications, Debt Service Reduction, Deficient
Valuation or REO Disposition that occurred during the related Prepayment Period
or, in the case of a Servicing Modification that constitutes a reduction of the
interest rate on a Mortgage Loan, the amount of the reduction in the interest
portion of the Monthly Payment due in the month in which such Distribution Date
occurs. The amount of each Realized Loss shall be evidenced by an Officers'
Certificate. All Realized Losses on the Group I Loans (other than Group I Excess
Losses) shall be allocated as follows: FIRST, to the Group I Excess Cash Flow as
provided in Section 4.02(c)(iii), to the extent of the Group I Excess Cash Flow
for such Distribution Date, SECOND, to the Group II Excess Cash Flow as provided
in Section 4.02(d)(iv), to the extent of the Group II Excess Cash Flow for such
Distribution Date remaining after distributions pursuant to Section
4.02(d)(iii); THIRD, in reduction of the Group I Overcollateralization Amount,
until such amount has been reduced to zero; FOURTH, in reduction of the Group II
Overcollateralization Amount, until such amount has been reduced to zero; and
thereafter, to the extent not covered by the Policy, to the Class A-I
Certificates on a pro rata basis. Any Group I Excess Losses on the Mortgage
Loans, to the extent not covered by the Policy, will be allocated to the Class
A-I Certificates on a pro rata basis, in an amount equal to a fraction of such
losses equal to (x) the aggregate Certificate Principal Balance of the Class A-I
Certificates over (y) the aggregate Stated Principal Balance of the Group I
Loans, and the remainder of such losses shall be allocated to the Group I
Overcollateralization Amount in reduction of the amount thereof. All Realized
Losses on the Group II Loans (other than Group II Excess Losses) shall be
allocated as follows: FIRST, to the Group II Excess Cash Flow as provided in
Section 4.02(d)(iii), to the extent of the Group II Excess Cash Flow for such
Distribution Date, SECOND, to the Group I Excess Cash Flow as provided in
Section 4.02(c)(iv), to the extent of the Group I Excess Cash Flow for such
Distribution Date remaining after distributions pursuant to Section
4.02(c)(iii); THIRD, in reduction of the Group II Overcollateralization Amount,
until such amount has been reduced to zero; FOURTH, in reduction of the Group I
Overcollateralization Amount, until such amount has been reduced to zero; and
thereafter, to the extent not covered by the Policy, to the Class A-II
Certificates. Any Group II Excess Losses on the Mortgage Loans, to the extent
not covered by the Policy, will be allocated to the Class A-II Certificates, in
an amount equal to a

                                       103

<PAGE>

fraction of such losses equal to (x) the Certificate Principal Balance of the
Class A-II Certificates over (y) the aggregate Stated Principal Balance of the
Group II Loans, and the remainder of such losses shall be allocated to the Group
II Overcollateralization Amount in reduction of the amount thereof.

         (b) Any allocation of the principal portion of Realized Losses (other
than Debt Service Reductions) to the Class A Certificates shall be made by
reducing the Certificate Principal Balance thereof by the amount so allocated,
which allocation shall be deemed to have occurred on such Distribution Date.
Allocations of the interest portions of Realized Losses shall be made by
operation of the definition of "Accrued Certificate Interest" and by operation
of the provisions of Section 4.02(c) and (d). All Realized Losses and all other
losses allocated to a Class of Certificates hereunder will be allocated among
the Certificates of such Class in proportion to the Percentage Interests
evidenced thereby.

         (c) All Realized Losses on the Group I Loans shall be allocated on each
Distribution Date to REMIC I Regular Interest LT-A-1 until the Uncertificated
Principal Balance thereof has been reduced to zero and then to REMIC I Regular
Interest LT-A-2 and LT-A-3 until the Uncertificated Principal Balances thereof
has been reduced to zero. All Realized Losses on the Group II Loans shall be
allocated on each Distribution Date to REMIC I Regular Interest LT-B until the
Uncertificated Principal Balance thereof has been reduced to zero.

         (d) (i) All Realized Losses on the Group I Loans shall be allocated on
each Distribution Date to the following REMIC III Group I Regular Interests
(other than REMIC III Regular Interest MT-I- IO) in the specified percentages,
as follows: FIRST, to Uncertificated Accrued Interest payable to the REMIC III
Regular Interests MT-I-1 and MT-1-7 up to an aggregate amount equal to the
excess of (a) the REMIC III Group I Interest Loss Allocation Amount over (b)
Prepayment Interest Shortfalls (to the extent not covered by Compensating
Interest) relating to the Group I Loans for such Distribution Date, 98% and 2%,
respectively; SECOND, to the Uncertificated Principal Balances of the REMIC III
Regular Interests MT-I-1 and MT-I-7 up to an aggregate amount equal to the REMIC
III Group I Principal Loss Allocation Amount, 98% and 2%, respectively; THIRD,
to the Uncertificated Principal Balances of REMIC III Regular Interests MT-I-1,
98%, MT-I-2, MT-I-3, MT-I-4, MT-I-5 and MT-I-6, 1% pro rata, and MT-I-7, 1%,
until the Uncertificated Balance of each of REMIC III Regular Interests MT-I-2,
MT-I-3, MT-I-4, MT-I-5 and MT-I-6 have been reduced to zero.

         (ii) All Realized Losses on the Group II Loans shall be allocated on
each Distribution Date to the following REMIC III Group II Regular Interests in
the specified percentages, as follows: FIRST, to Uncertificated Accrued Interest
payable to the REMIC III Regular Interests MT-II-1 and MT-II-3 up to an
aggregate amount equal to the excess of (a) the REMIC III Group II Interest Loss
Allocation Amount over (b) Prepayment Interest Shortfalls (to the extent not
covered by Compensating Interest) relating to the Group II Loans for such
Distribution Date, 98% and 2%, respectively; SECOND, to the Uncertificated
Principal Balances of the REMIC III Regular Interests MT-II-1 and MT-II-3 up to
an aggregate amount equal to the REMIC III Group II Principal Loss Allocation
Amount, 98% and 2%, respectively; THIRD, to the Uncertificated Principal
Balances of REMIC III Regular Interests MT-II-1, MT-II-2 and MT-II-3, 98%, 1%
and 1%, respectively, until the Uncertificated Balance of REMIC III Regular
Interest MT-II-2 has been reduced to zero.

                                       104

<PAGE>

         Section 4.06.     REPORTS OF FORECLOSURES AND ABANDONMENT OF MORTGAGED
                           PROPERTY.

         The Master Servicer or the Subservicers shall file information returns
with respect to the receipt of mortgage interest received in a trade or
business, the reports of foreclosures and abandonments of any Mortgaged Property
and the informational returns relating to cancellation of indebtedness income
with respect to any Mortgaged Property required by Sections 6050H, 6050J and
6050P of the Code, respectively, and deliver to the Trustee an Officers'
Certificate on or before March 31 of each year stating that such reports have
been filed. Such reports shall be in form and substance sufficient to meet the
reporting requirements imposed by such Sections 6050H, 6050J and 6050P of the
Code.

         Section 4.07.     OPTIONAL PURCHASE OF DEFAULTED MORTGAGE LOANS.

         As to any Mortgage Loan which is delinquent in payment by 90 days or
more, the Master Servicer may, at its option, purchase such Mortgage Loan from
the Trustee at the Purchase Price therefor; provided, that any such Mortgage
Loan that becomes 90 days or more delinquent during any given Calendar Quarter
shall only be eligible for purchase pursuant to this Section during the period
beginning on the first Business Day of the following Calendar Quarter, and
ending at the close of business on the second-to-last Business Day of such
following Calendar Quarter. Such option if not exercised shall not thereafter be
reinstated as to any Mortgage Loan, unless the delinquency is cured and the
Mortgage Loan thereafter again becomes delinquent in payment by 90 days or more
in a subsequent Calendar Quarter. If at any time the Master Servicer makes a
payment to the Certificate Account covering the amount of the Purchase Price for
such a Mortgage Loan, and the Master Servicer provides to the Trustee a
certification signed by a Servicing Officer stating that the amount of such
payment has been deposited in the Certificate Account, then the Trustee shall
execute the assignment of such Mortgage Loan at the request of the Master
Servicer without recourse to the Master Servicer which shall succeed to all the
Trustee's right, title and interest in and to such Mortgage Loan, and all
security and documents relative thereto. Such assignment shall be an assignment
outright and not for security. The Master Servicer will thereupon own such
Mortgage, and all such security and documents, free of any further obligation to
the Trustee or the Certificateholders with respect thereto.

         Section 4.08.     THE POLICY.

         (a) If pursuant to Section 4.04(a)(iv), the Master Servicer determines
that a Deficiency Amount exists for such Distribution Date, the Trustee shall
complete the Notice and submit such Notice in accordance with the Policy to the
Insurer no later than 12:00 P.M., New York City time, on the Business Day
immediately preceding each Distribution Date, as a claim for an Insured Amount
(provided that the Trustee shall submit such notice on the second Business Day
immediately preceding such Distribution Date if it is able to do so) in an
amount equal to such Deficiency Amount.

         (b) The Trustee shall establish and maintain the Insurance Account on
behalf of the Holders of the Class A Certificates. Upon receipt of an Insured
Amount from the Insurer on behalf of the Class A Certificateholders, the Trustee
shall deposit such Insured Amount in the Insurance Account. All amounts on
deposit in the Insurance Account shall remain uninvested. On each Distribution

                                       105

<PAGE>

Date, the Trustee shall transfer any Insured Amount then on deposit in the
Insurance Account to the Certificate Account. The Trustee shall distribute on
each Distribution Date the Deficiency Amount for such Distribution Date from the
Certificate Account, together with the distributions due to the Class A
Certificateholders on such Distribution Date, as follows: (i) the portion of any
such Deficiency Amount related to clauses (i) and (ii) of the definition of
Deficiency Amount shall be distributed among the related Class A
Certificateholders on a pro rata basis in accordance with their respective
shortfalls or allocations of Realized Losses; and (ii) the portion of any such
Deficiency Amount related to clause (iii) of the definition of Deficiency Amount
shall be distributed to the related Class A Certificateholders in accordance
with Section 9.01(c).

         (c) The Trustee shall (i) receive as attorney-in-fact of each Class A
Certificateholder any Insured Amount from the Insurer and (ii) distribute such
Insured Amount to such Class A Certificateholders as set forth in subsection (b)
above. Insured Amounts disbursed by the Trustee from proceeds of the Policy
shall not be considered payment by the Trust Fund with respect to the Class A
Certificates, nor shall such disbursement of such Insured Amounts discharge the
obligations of the Trust Fund with respect to the amounts thereof, and the
Insurer shall become owner of such amounts to the extent covered by such Insured
Amounts as the deemed assignee of such Class A Certificateholders. The Trustee
hereby agrees on behalf of each Class A Certificateholder (and each Class A
Certificateholder, by its acceptance of its Class A Certificates, hereby agrees)
for the benefit of the Insurer that the Trustee shall recognize that to the
extent the Insurer pays Insured Amounts, either directly or indirectly (as by
paying through the Trustee), to the Class A Certificateholders, the Insurer will
be entitled to be subrogated to the rights of the Class A Certificateholders to
the extent of such payments.

         Section 4.09.     DISTRIBUTION OF BASIS RISK SHORTFALL CARRY-FORWARD
                           AMOUNT; RESERVE FUND.

         (a) On the Closing Date, the Trustee shall establish and maintain in
its name, in trust for the benefit of Class A-II Certificates, the Reserve Fund.
In addition, on the Closing Date, the Trustee shall deposit into the Reserve
Fund the Reserve Fund Deposit. On each Distribution Date, the Trustee shall
transfer from the Certificate Account to the Reserve Fund the amounts specified
pursuant to Sections 4.02(c)(xiv) and 4.02(d)(xiv). On each Distribution Date,
to the extent required, the Trustee shall make withdrawals from the Reserve Fund
and use the amounts in the Reserve Fund to make distributions to the Class A-II
Certificates, in an amount equal to the amount of any Basis Risk Shortfall
Carry-Forward Amount on such Certificate. Any such amounts transferred shall be
treated for federal tax purposes as amounts distributed by REMIC IV to the Class
SB-II Certificateholders as transferee thereof. On each Distribution Date, to
the extent that the balance of deposits in the Reserve Fund is in excess of
$5,000 after the distributions described in the second preceding sentence, the
Trustee shall, based upon the information provided by the Master Servicer,
withdraw from the Reserve Fund (to the extent of funds available on deposit
therein) such amounts in excess of $5,000, if any, and distribute them to the
holder of the Reserve Fund Residual Right.

         (b) The Reserve Fund shall be an Eligible Account. Amounts held in the
Reserve Fund from time to time shall continue to constitute assets of the Trust
Fund, but not of the REMICs, until released from the Reserve Fund pursuant to
this Section 4.09. The Reserve Fund constitutes an "outside reserve fund" within
the meaning of Treasury Regulation ss. 1.860G-2(h) and is not an asset of the
REMICs. The Class SB-II Certificateholders shall be the owners of the Reserve
Fund, and for

                                       106

<PAGE>

all federal tax purposes, amounts transferred by the REMICs to the Reserve Fund
shall be treated as amounts distributed by the REMICs to the Class SB-II
Certificateholders. The Trustee shall keep records that accurately reflect the
funds on deposit in the Reserve Fund. The Trustee shall, at the direction of the
Master Servicer, invest amounts on deposit in the Reserve Fund in Permitted
Investments. In the absence of written direction to the Trustee from the Master
Servicer, all funds in the Reserve Fund shall remain uninvested. On each
Distribution Date, the Trustee shall distribute any interest on the Reserve Fund
to the holder of the Reserve Fund Residual Right.

         (c) The holder of the Reserve Fund Residual Right with respect to the
Reserve Fund shall initially be Residential Funding as holder of the Class SB-II
Certificates, and such Reserve Fund Residual Right shall at all times be owned
by and allocated to Class SB-II Certificateholders on a pro rata basis. So long
as Residential Funding is the holder of the Class SB-II Certificates, any
amounts payable pursuant to this Section 4.09 shall be payable to Residential
Funding. In the event of a transfer of the ownership in any of the Class SB-II
Certificates by Residential Funding, the Reserve Fund Residual Right will be
transferred along with such Class SB-II Certificates.

         Section 4.10.     Special Report to Insurer.

         On each Distribution Date, the Master Servicer shall forward to the
Insurer a statement setting forth the following information as to the
Re-Performing Loans and Foreclosure Restricted Loans, separately for Loan Group
I and Loan Group II, with respect to both the number of Mortgage Loans and their
aggregate Stated Principal Balance, that are: (i) current (not 30 days or more
Delinquent), (ii) 30 to 59 days Delinquent, (iii) 60 to 89 days Delinquent and
(iv) 90 days or more Delinquent (including such Mortgage Loans that are in
foreclosure or are REO Properties).

                                       107

<PAGE>

                                    ARTICLE V

                                THE CERTIFICATES

         Section 5.01.     THE CERTIFICATES.

         (a) The Class A Certificates, Class SB Certificates and Class R
Certificates shall be substantially in the forms set forth in Exhibits A, B and
D, respectively, and shall, on original issue, be executed and delivered by the
Trustee to the Certificate Registrar for authentication and delivery to or upon
the order of the Depositor upon receipt by the Trustee or one or more Custodians
of the documents specified in Section 2.01. The Class A Certificates shall be
issuable in minimum dollar denominations of $25,000 and integral multiples of $1
in excess thereof. The Class SB Certificates shall be issuable in registered,
certificated form in minimum percentage interests of 5.00% and integral
multiples of 0.01% in excess thereof. Each Class of Class R Certificates shall
be issued in registered, certificated form in minimum percentage interests of
20.00% and integral multiples of 0.01% in excess thereof; PROVIDED, HOWEVER,
that one Class R Certificate of each Class will be issuable to the REMIC
Administrator as "tax matters person" pursuant to Section 10.01(c) in a minimum
denomination representing a Percentage Interest of not less than 0.01%.The
Certificates shall be executed by manual or facsimile signature on behalf of an
authorized officer of the Trustee. Certificates bearing the manual or facsimile
signatures of individuals who were at any time the proper officers of the
Trustee shall bind the Trustee, notwithstanding that such individuals or any of
them have ceased to hold such offices prior to the authentication and delivery
of such Certificate or did not hold such offices at the date of such
Certificates. 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 the Certificate Registrar by manual signature, and such certificate
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.

         (b) The Class A Certificates shall initially be issued as one or more
Certificates registered in the name of the Depository or its nominee and, except
as provided below, registration of such Certificates may not be transferred by
the Trustee except to another Depository that agrees to hold such Certificates
for the respective Certificate Owners with Ownership Interests therein. The
Certificate Owners shall hold their respective Ownership Interests in and to
each Class A Certificate, through the book-entry facilities of the Depository
and, except as provided below, shall not be entitled to Definitive Certificates
in respect of such Ownership Interests. All transfers by Certificate Owners of
their respective Ownership Interests in the Book-Entry Certificates shall be
made in accordance with the procedures established by the Depository Participant
or brokerage firm representing such Certificate Owner. Each Depository
Participant shall transfer the Ownership Interests only in the Book-Entry
Certificates of Certificate Owners it represents or of brokerage firms for which
it acts as agent in accordance with the Depository's normal procedures.

         The Trustee, the Master Servicer and the Depositor may for all purposes
(including the making of payments due on the respective Classes of Book-Entry
Certificates) deal with the Depository as the authorized representative of the
Certificate Owners with respect to the respective Classes of Book-Entry
Certificates for the purposes of exercising the rights of Certificateholders

                                       108

<PAGE>

hereunder. The rights of Certificate Owners with respect to the respective
Classes of Book-Entry Certificates shall be limited to those established by law
and agreements between such Certificate Owners and the Depository Participants
and brokerage firms representing such Certificate Owners. Multiple requests and
directions from, and votes of, the Depository as Holder of any Class of Book-
Entry Certificates with respect to any particular matter shall not be deemed
inconsistent if they are made with respect to different Certificate Owners. The
Trustee may establish a reasonable record date in connection with solicitations
of consents from or voting by Certificateholders and shall give notice to the
Depository of such record date. If (i)(A) the Depositor advises the Trustee in
writing that the Depository is no longer willing or able to properly discharge
its responsibilities as Depository and (B) the Depositor is unable to locate a
qualified successor or (ii) the Depositor at its option advises the Trustee in
writing that it elects to terminate the book-entry system through the
Depository, the Trustee shall notify all Certificate Owners, through the
Depository, of the occurrence of any such event and of the availability of
Definitive Certificates to Certificate Owners requesting the same. Upon
surrender to the Trustee of the Book-Entry Certificates by the Depository,
accompanied by registration instructions from the Depository for registration of
transfer, the Trustee shall issue the Definitive Certificates. Neither the
Depositor, the Master Servicer nor the Trustee shall be liable for any actions
taken by the Depository or its nominee, including, without limitation, 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 Depositor in connection with the issuance of the Definitive
Certificates pursuant to this Section 5.01 shall be deemed to be imposed upon
and performed by the Trustee, and the Trustee and the Master Servicer shall
recognize the Holders of the Definitive Certificates as Certificateholders
hereunder.

         (c) Each of the Certificates is intended to be a "security" governed by
Article 8 of the Uniform Commercial Code as in effect in the State of New York
and any other applicable jurisdiction, to the extent that any of such laws may
be applicable.

         Section 5.02.     REGISTRATION OF TRANSFER AND EXCHANGE OF
                           CERTIFICATES.

         (a) The Trustee shall cause to be kept at one of the offices or
agencies to be appointed by the Trustee in accordance with the provisions of
Section 8.12 a Certificate Register in which, subject to such reasonable
regulations as it may prescribe, the Trustee shall provide for the registration
of Certificates and of transfers and exchanges of Certificates as herein
provided. The Trustee is initially appointed Certificate Registrar for the
purpose of registering Certificates and transfers and exchanges of Certificates
as herein provided. The Certificate Registrar, or the Trustee, shall provide the
Master Servicer with a certified list of Certificateholders as of each Record
Date prior to the related Determination Date.

         (b) Upon surrender for registration of transfer of any Certificate at
any office or agency of the Trustee maintained for such purpose pursuant to
Section 8.12 and, in the case of any Class SB or R Certificate, upon
satisfaction of the conditions set forth below, the Trustee shall execute and
the Certificate Registrar shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Certificates of a like
Class and aggregate Percentage Interest.

                                       109

<PAGE>

         (c) At the option of the Certificateholders, Certificates may be
exchanged for other Certificates of authorized denominations of a like Class and
aggregate Percentage Interest, upon surrender of the Certificates to be
exchanged at any such office or agency. Whenever any Certificates are so
surrendered for exchange the Trustee shall execute and the Certificate Registrar
shall authenticate and deliver the Certificates of such Class which the
Certificateholder making the exchange is entitled to receive. Every Certificate
presented or surrendered for transfer or exchange shall (if so required by the
Trustee or the Certificate Registrar) be duly endorsed by, or be accompanied by
a written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by, the Holder thereof or his attorney duly
authorized in writing.

         (d) No transfer, sale, pledge or other disposition of a Class SB or
Class R Certificate shall be made unless such transfer, sale, pledge or other
disposition is exempt from the registration requirements of the Securities Act
of 1933, as amended (the "1933 Act"), and any applicable state securities laws
or is made in accordance with said Act and laws. Except as otherwise provided in
this Section 5.02(d), in the event that a transfer of a Class SB or Class R
Certificate is to be made, (i) unless the Depositor directs the Trustee
otherwise, the Trustee shall require a written Opinion of Counsel acceptable to
and in form and substance satisfactory to the Trustee and the Depositor that
such transfer may be made pursuant to an exemption, describing the applicable
exemption and the basis therefor, from said Act and laws or is being made
pursuant to said Act and laws, which Opinion of Counsel shall not be an expense
of the Trustee, the Trust Fund, the Depositor or the Master Servicer, and (ii)
the Trustee shall require the transferee to execute a representation letter,
substantially in the form of Exhibit I hereto, and the Trustee shall require the
transferor to execute a representation letter, substantially in the form of
Exhibit J hereto, each acceptable to and in form and substance satisfactory to
the Depositor and the Trustee certifying to the Depositor and the Trustee the
facts surrounding such transfer, which representation letters shall not be an
expense of the Trustee, the Trust Fund, the Depositor or the Master Servicer. In
lieu of the requirements set forth in the preceding sentence, transfers of Class
SB or Class R Certificates may be made in accordance with this Section 5.02(d)
if the prospective transferee of such a Certificate provides the Trustee and the
Master Servicer with an investment letter substantially in the form of Exhibit N
attached hereto, which investment letter shall not be an expense of the Trustee,
the Depositor, or the Master Servicer, and which investment letter states that,
among other things, such transferee (i) is a "qualified institutional buyer" as
defined under Rule 144A, acting for its own account or the accounts of other
"qualified institutional buyers" as defined under Rule 144A, and (ii) is aware
that the proposed transferor intends to rely on the exemption from registration
requirements under the 1933 Act provided by Rule 144A. The Holder of a Class SB
or Class R Certificate desiring to effect any transfer, sale, pledge or other
disposition shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Master Servicer and the Certificate Registrar against any
liability that may result if the transfer, sale, pledge or other disposition is
not so exempt or is not made in accordance with such federal and state laws and
this Agreement.

         (e) In the case of any Class SB or Class R Certificate presented for
registration in the name of any Person, either (i) the Trustee shall require an
Opinion of Counsel acceptable to and in form and substance satisfactory to the
Trustee, the Depositor and the Master Servicer to the effect that the purchase
or holding of such Class SB or Class R Certificate is permissible under
applicable law, will not constitute or result in any non-exempt prohibited
transaction under Section 406 of ERISA, or Section 4975 of the Code (or
comparable provisions of any subsequent enactments), and will not

                                       110

<PAGE>

subject the Trustee, the Depositor or the Master Servicer to any obligation or
liability (including obligations or liabilities under ERISA or Section 4975 of
the Code) in addition to those undertaken in this Agreement, which Opinion of
Counsel shall not be an expense of the Trustee, the Depositor or the Master
Servicer or (ii) the prospective transferee shall be required to provide the
Trustee, the Depositor and the Master Servicer with a certification to the
effect set forth in Exhibit P (with respect to a Class SB Certificate) or in
paragraph fourteen of Exhibit H-1 (with respect to a Class R Certificate), which
the Trustee may rely upon without further inquiry or investigation, or such
other certifications as the Trustee may deem desirable or necessary in order to
establish that such transferee or the Person in whose name such registration is
requested is not an employee benefit plan or other plan subject to the
prohibited transaction provisions of ERISA or Section 4975 of the Code, or any
Person (including an insurance company investing its general accounts, an
investment manager, a named fiduciary or a trustee of any such plan) who is
using "plan assets" of any such plan to effect such acquisition.

         (f) (i) Each Person who has or who acquires any Ownership Interest in a
Class R Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions and to
have irrevocably authorized the Trustee or its designee under clause (iii)(A)
below to deliver payments to a Person other than such Person and to negotiate
the terms of any mandatory sale under clause (iii)(B) below and to execute all
instruments of transfer and to do all other things necessary in connection with
any such sale. The rights of each Person acquiring any Ownership Interest in a
Class R Certificate are expressly subject to the following provisions:

                  (A) Each Person holding or acquiring any Ownership Interest in
         a Class R Certificate shall be a Permitted Transferee and shall
         promptly notify the Trustee of any change or impending change in its
         status as a Permitted Transferee.

                  (B) In connection with any proposed Transfer of any Ownership
         Interest in a Class R Certificate, the Trustee shall require delivery
         to it, and shall not register the Transfer of any Class R Certificate
         until its receipt of,

                           (I) an affidavit and agreement (a "Transfer Affidavit
                           and Agreement," in the form attached hereto as
                           Exhibit H-1) from the proposed Transferee, in form
                           and substance satisfactory to the Master Servicer,
                           representing and warranting, among other things, that
                           it is a Permitted Transferee, that it is not
                           acquiring its Ownership Interest in the Class R
                           Certificate that is the subject of the proposed
                           Transfer as a nominee, trustee or agent for any
                           Person who is not a Permitted Transferee, that for so
                           long as it retains its Ownership Interest in a Class
                           R Certificate, it will endeavor to remain a Permitted
                           Transferee, and that it has reviewed the provisions
                           of this Section 5.02(f) and agrees to be bound by
                           them, and

                           (II) a certificate, in the form attached hereto as
                           Exhibit H-2, from the Holder wishing to transfer the
                           Class R Certificate, in form and substance
                           satisfactory to the Master Servicer, representing and
                           warranting, among other things, that

                                       111

<PAGE>

                           no purpose of the proposed Transfer is to impede the
                           assessment or collection of tax.

                  (C) Notwithstanding the delivery of a Transfer Affidavit and
                  Agreement by a proposed Transferee under clause (B) above, if
                  a Responsible Officer of the Trustee who is assigned to this
                  Agreement has actual knowledge that the proposed Transferee is
                  not a Permitted Transferee, no Transfer of an Ownership
                  Interest in a Class R Certificate to such proposed Transferee
                  shall be effected.

                  (D) Each Person holding or acquiring any Ownership Interest in
                  a Class R Certificate shall agree (x) to require a Transfer
                  Affidavit and Agreement from any other Person to whom such
                  Person attempts to transfer its Ownership Interest in a Class
                  R Certificate and (y) not to transfer its Ownership Interest
                  unless it provides a certificate to the Trustee in the form
                  attached hereto as Exhibit H-2.

                  (E) Each Person holding or acquiring an Ownership Interest in
                  a Class R Certificate, by purchasing an Ownership Interest in
                  such Certificate, agrees to give the Trustee written notice
                  that it is a "pass-through interest holder" within the meaning
                  of Temporary Treasury Regulations Section 1.67-3T(a)(2)(i)(A)
                  immediately upon acquiring an Ownership Interest in a Class R
                  Certificate, if it is, or is holding an Ownership Interest in
                  a Class R Certificate on behalf of, a "pass-through interest
                  holder."

         (ii) The Trustee will register the Transfer of any Class R Certificate
only if it shall have received the Transfer Affidavit and Agreement, a
certificate of the Holder requesting such transfer in the form attached hereto
as Exhibit H-2 and all of such other documents as shall have been reasonably
required by the Trustee as a condition to such registration. Transfers of the
Class R Certificates to Non-United States Persons and Disqualified Organizations
(as defined in Section 860E(e)(5) of the Code) are prohibited.

                  (A) If any Disqualified Organization shall become a holder of
                  a Class R Certificate, then the last preceding Permitted
                  Transferee shall be restored, to the extent permitted by law,
                  to all rights and obligations as Holder thereof retroactive to
                  the date of registration of such Transfer of such Class R
                  Certificate. If a Non-United States Person shall become a
                  holder of a Class R Certificate, then the last preceding
                  United States Person shall be restored, to the extent
                  permitted by law, to all rights and obligations as Holder
                  thereof retroactive to the date of registration of such
                  Transfer of such Class R Certificate. If a transfer of a Class
                  R Certificate is disregarded pursuant to the provisions of
                  Treasury Regulations Section 1.860E-1 or Section 1.860G-3,
                  then the last preceding Permitted Transferee shall be
                  restored, to the extent permitted by law, to all rights and
                  obligations as Holder thereof retroactive to the date of
                  registration of such Transfer of such Class R Certificate. The
                  Trustee shall be under no liability to any Person for any
                  registration of Transfer of a Class R Certificate that is in
                  fact not permitted by this Section 5.02(f) or for making any
                  payments due on such Certificate to the holder thereof or for
                  taking any other action with respect to such holder under the
                  provisions of this Agreement.

                                       112

<PAGE>

                  (B) If any purported Transferee shall become a Holder of a
                  Class R Certificate in violation of the restrictions in this
                  Section 5.02(f) and to the extent that the retroactive
                  restoration of the rights of the Holder of such Class R
                  Certificate as described in clause (iii)(A) above shall be
                  invalid, illegal or unenforceable, then the Master Servicer
                  shall have the right, without notice to the holder or any
                  prior holder of such Class R Certificate, to sell such Class R
                  Certificate to a purchaser selected by the Master Servicer on
                  such terms as the Master Servicer may choose. Such purported
                  Transferee shall promptly endorse and deliver each Class R
                  Certificate in accordance with the instructions of the Master
                  Servicer. Such purchaser may be the Master Servicer itself or
                  any Affiliate of the Master Servicer. The proceeds of such
                  sale, net of the commissions (which may include commissions
                  payable to the Master Servicer or its Affiliates), expenses
                  and taxes due, if any, will be remitted by the Master Servicer
                  to such purported Transferee. The terms and conditions of any
                  sale under this clause (iii)(B) shall be determined in the
                  sole discretion of the Master Servicer, and the Master
                  Servicer shall not be liable to any Person having an Ownership
                  Interest in a Class R Certificate as a result of its exercise
                  of such discretion.

         (iv) The Master Servicer, on behalf of the Trustee, shall make
available, upon written request from the Trustee, all information necessary to
compute any tax imposed

                  (A) as a result of the Transfer of an Ownership Interest in a
                  Class R Certificate to any Person who is a Disqualified
                  Organization, including the information regarding "excess
                  inclusions" of such Class R Certificates required to be
                  provided to the Internal Revenue Service and certain Persons
                  as described in Treasury Regulations Sections 1.860D-1(b)(5)
                  and 1.860E-2(a)(5), and

                  (B) as a result of any regulated investment company, real
                  estate investment trust, common trust fund, partnership,
                  trust, estate or organization described in Section 1381 of the
                  Code that holds an Ownership Interest in a Class R Certificate
                  having as among its record holders at any time any Person who
                  is a Disqualified Organization. Reasonable compensation for
                  providing such information may be required by the Master
                  Servicer from such Person.

         (v) The provisions of this Section 5.02(f) set forth prior to this
clause (v) may be modified, added to or eliminated, provided that there shall
have been delivered to the Trustee the following:

                  (A) Written consent of the Insurer and written notification
                  from each Rating Agency to the effect that the modification,
                  addition to or elimination of such provisions will not cause
                  such Rating Agency to downgrade its then-current ratings, if
                  any, of the Class A Certificates below the lower of the
                  then-current rating or the rating assigned to such
                  Certificates as of the Closing Date by such Rating Agency; and

                  (B) a certificate of the Master Servicer stating that the
                  Master Servicer has received an Opinion of Counsel, in form
                  and substance satisfactory to the Master Servicer, to the
                  effect that such modification, addition to or absence of such
                  provisions will not

                                       113

<PAGE>

                  cause any of REMIC I, REMIC II, REMIC III or REMIC IV to cease
                  to qualify as a REMIC and will not cause (x) any of REMIC I or
                  REMIC III to be subject to an entity-level tax caused by the
                  Transfer of any Class R Certificate to a Person that is a
                  Disqualified Organization or (y) a Certificateholder or
                  another Person to be subject to a REMIC-related tax caused by
                  the Transfer of a Class R Certificate to a Person that is not
                  a Permitted Transferee.

         (g) No service charge shall be made for any transfer or exchange of
Certificates of any Class, but the Trustee may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.

         (h) All Certificates surrendered for transfer and exchange shall be
destroyed by the Certificate Registrar.

         Section 5.03.     MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES.

         If (i) any mutilated Certificate is surrendered to the Certificate
Registrar, or the Trustee and the Certificate Registrar receive evidence to
their satisfaction of the destruction, loss or theft of any Certificate, and
(ii) 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 Trustee or the Certificate Registrar that
such Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute and the Certificate Registrar shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of like tenor, Class and Percentage Interest but
bearing a number not contemporaneously outstanding. Upon the issuance of any new
Certificate under this Section, the Trustee may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Trustee and the Certificate Registrar) connected therewith. Any duplicate
Certificate issued pursuant to this Section shall constitute complete and
indefeasible evidence of ownership in the Trust Fund, as if originally issued,
whether or not the lost, stolen or destroyed Certificate shall be found at any
time.

         Section 5.04.     PERSONS DEEMED OWNERS.

         Prior to due presentation of a Certificate for registration of
transfer, the Depositor, the Master Servicer, the Insurer, the Trustee, the
Certificate Registrar and any agent of the Depositor, the Master Servicer, the
Insurer, the Trustee or the Certificate Registrar may treat the Person in whose
name any Certificate is registered as the owner of such Certificate for the
purpose of receiving distributions pursuant to Section 4.02 and for all other
purposes whatsoever, except as and to the extent provided in the definition of
"Certificateholder" and in Section 4.08, and neither the Depositor, the Master
Servicer, the Insurer, the Trustee, the Certificate Registrar nor any agent of
the Depositor, the Master Servicer, the Trustee or the Certificate Registrar
shall be affected by notice to the contrary except as provided in Section
5.02(f).

         Section 5.05.     APPOINTMENT OF PAYING AGENT.

                                       114

<PAGE>

         The Trustee may, with the consent of the Insurer (so long as no Insurer
Default exists), which consent shall not be unreasonably withheld, appoint a
Paying Agent for the purpose of making distributions to Certificateholders
pursuant to Section 4.02. In the event of any such appointment, on or prior to
each Distribution Date the Master Servicer on behalf of the Trustee shall
deposit or cause to be deposited with the Paying Agent a sum sufficient to make
the payments to Certificateholders in the amounts and in the manner provided for
in Section 4.02 and 4.03, such sum to be held in trust for the benefit of
Certificateholders. The Trustee shall cause each 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 trust for the benefit of the Certificateholders
entitled thereto until such sums shall be paid to such Certificateholders. Any
sums so held by such Paying Agent shall be held only in Eligible Accounts to the
extent such sums are not distributed to the Certificateholders on the date of
receipt by such Paying Agent.

                                       115

<PAGE>

                                   ARTICLE VI

                      THE DEPOSITOR AND THE MASTER SERVICER

         Section 6.01.     RESPECTIVE LIABILITIES OF THE DEPOSITOR AND THE
                           MASTER SERVICER.

         The Depositor and the Master Servicer shall each be liable in
accordance herewith only to the extent of the obligations specifically and
respectively imposed upon and undertaken by the Depositor and the Master
Servicer herein. By way of illustration and not limitation, the Depositor is not
liable for the servicing and administration of the Mortgage Loans, nor is it
obligated by Section 7.01 or 10.01 to assume any obligations of the Master
Servicer or to appoint a designee to assume such obligations, nor is it liable
for any other obligation hereunder that it may, but is not obligated to, assume
unless it elects to assume such obligation in accordance herewith.

         Section 6.02.     MERGER OR CONSOLIDATION OF THE DEPOSITOR OR THE
                           MASTER SERVICER; ASSIGNMENT OF RIGHTS AND DELEGATION
                           OF DUTIES BY MASTER SERVICER.

         (a) The Depositor and the Master Servicer will each keep in full effect
its existence, rights and franchises as a corporation under the laws of the
state of its incorporation, and will each obtain and preserve its qualification
to do business as a foreign corporation in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its respective duties under this Agreement.

         (b) Any Person into which the Depositor or the Master Servicer may be
merged or consolidated, or any corporation resulting from any merger or
consolidation to which the Depositor or the Master Servicer shall be a party, or
any Person succeeding to the business of the Depositor or the Master Servicer,
shall be the successor of the Depositor or the Master Servicer, as the case may
be, hereunder, without the execution or filing of any paper or any further act
on the part of any of the parties hereto, anything herein to the contrary
notwithstanding; PROVIDED, HOWEVER, that the successor or surviving Person to
the Master Servicer shall be qualified to service mortgage loans on behalf of
Fannie Mae or Freddie Mac; and provided further that each Rating Agency's
ratings, if any, of the Class A Certificates without taking into account the
Policy in effect immediately prior to such merger or consolidation will not be
qualified, reduced or withdrawn as a result thereof (as evidenced by a letter to
such effect from each Rating Agency).

         (c) Notwithstanding anything else in this Section 6.02 and Section 6.04
to the contrary, the Master Servicer may assign its rights and delegate its
duties and obligations under this Agreement; provided that the Person accepting
such assignment or delegation shall be a Person which is qualified to service
mortgage loans on behalf of Fannie Mae or Freddie Mac, is reasonably
satisfactory to the Trustee, the Insurer and the Depositor, is willing to
service the Mortgage Loans and executes and delivers to the Depositor, the
Insurer and the Trustee an agreement, in form and substance reasonably
satisfactory to the Depositor, the Insurer and the Trustee, which contains an
assumption by such Person of the due and punctual performance and observance of
each covenant and condition to be performed or observed by the Master Servicer
under this Agreement; provided further that each

                                       116

<PAGE>

Rating Agency's rating of the Classes of Certificates (without taking into
account the Policy) that have been rated in effect immediately prior to such
assignment and delegation will not be qualified, reduced or withdrawn as a
result of such assignment and delegation (as evidenced by a letter to such
effect from each Rating Agency). In the case of any such assignment and
delegation, the Master Servicer shall be released from its obligations under
this Agreement, except that the Master Servicer shall remain liable for all
liabilities and obligations incurred by it as Master Servicer hereunder prior to
the satisfaction of the conditions to such assignment and delegation set forth
in the next preceding sentence.

         Section 6.03.     LIMITATION ON LIABILITY OF THE DEPOSITOR, THE MASTER
                           SERVICER AND OTHERS.

         Neither the Depositor, the Master Servicer nor any of the directors,
officers, employees or agents of the Depositor or the Master Servicer shall be
under any liability to the Trust Fund or the Certificateholders for any action
taken or for refraining from the taking of any action in good faith pursuant to
this Agreement, or for errors in judgment; PROVIDED, HOWEVER, that this
provision shall not protect the Depositor, the Master Servicer or any such
Person against any breach of warranties or representations made herein or any
liability which would otherwise be imposed by reason of willful misfeasance, bad
faith or gross negligence in the performance of duties or by reason of reckless
disregard of obligations and duties hereunder. The Depositor, the Master
Servicer and any director, officer, employee or agent of the Depositor or the
Master Servicer may rely in good faith on any document of any kind prima facie
properly executed and submitted by any Person respecting any matters arising
hereunder. The Depositor, the Master Servicer and any director, officer,
employee or agent of the Depositor or the Master Servicer shall be indemnified
by the Trust Fund and held harmless against any loss, liability or expense
incurred in connection with any legal action relating to this Agreement or the
Certificates, other than any loss, liability or expense related to any specific
Mortgage Loan or Mortgage Loans (except as any such loss, liability or expense
shall be otherwise reimbursable pursuant to this Agreement) and any loss,
liability or expense incurred by reason of willful misfeasance, bad faith or
gross negligence in the performance of duties hereunder or by reason of reckless
disregard of obligations and duties hereunder. Neither the Depositor nor the
Master Servicer shall be under any obligation to appear in, prosecute or defend
any legal or administrative action, proceeding, hearing or examination that is
not incidental to its respective duties under this Agreement and which in its
opinion may involve it in any expense or liability; PROVIDED, HOWEVER, that the
Depositor or the Master Servicer may in its discretion undertake any such
action, proceeding, hearing or examination that it may deem necessary or
desirable in respect to this Agreement and the rights and duties of the parties
hereto and the interests of the Certificateholders hereunder. In such event, the
legal expenses and costs of such action, proceeding, hearing or examination and
any liability resulting therefrom shall be expenses, costs and liabilities of
the Trust Fund, and the Depositor and the Master Servicer shall be entitled to
be reimbursed therefor out of amounts attributable to the Mortgage Loans on
deposit in the Custodial Account as provided by Section 3.10 and, on the
Distribution Date(s) following such reimbursement, the aggregate of such
expenses and costs shall be allocated in reduction of the Accrued Certificate
Interest on each Class entitled thereto in the same manner as if such expenses
and costs constituted a Prepayment Interest Shortfall.

         Section 6.04.     DEPOSITOR AND MASTER SERVICER NOT TO RESIGN.

                                       117

<PAGE>

         Subject to the provisions of Section 6.02, neither the Depositor nor
the Master Servicer shall resign from its respective obligations and duties
hereby imposed on it except upon determination that its duties hereunder are no
longer permissible under applicable law. Any such determination permitting the
resignation of the Depositor or the Master Servicer shall be evidenced by an
Opinion of Counsel (at the expense of the resigning party) to such effect
delivered to the Trustee and the Insurer. No such resignation by the Master
Servicer shall become effective until the Trustee or a successor servicer shall
have assumed the Master Servicer's responsibilities and obligations in
accordance with Section 7.02.

                                       118

<PAGE>

                                   ARTICLE VII

                                     DEFAULT

         Section 7.01.     EVENTS OF DEFAULT.

         Event of Default, wherever used herein, means any one of the following
events (whatever reason for such Event of Default and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment, decree or order of any court or any order, rule or regulation of any
administrative or governmental body):

         (i) the Master Servicer shall fail to distribute or cause to be
distributed to Holders of Certificates of any Class any distribution required to
be made under the terms of the Certificates of such Class and this Agreement
and, in either case, such failure shall continue unremedied for a period of 5
days after the date upon which written notice of such failure, requiring such
failure to be remedied, shall have been given to the Master Servicer by the
Trustee, the Insurer or the Depositor or to the Master Servicer, the Depositor
and the Trustee by the Holders of Certificates of such Class evidencing
Percentage Interests aggregating not less than 25%; or

         (ii) the Master Servicer shall fail to observe or perform in any
material respect any other of the covenants or agreements on the part of the
Master Servicer contained in the Certificates of any Class or in this Agreement
and such failure shall continue unremedied for a period of 30 days (except that
such number of days shall be 15 in the case of a failure to pay the premium for
any Required Insurance Policy) after the date on which written notice of such
failure, requiring the same to be remedied, shall have been given to the Master
Servicer by the Trustee, the Insurer or the Depositor, or to the Master
Servicer, the Depositor and the Trustee by the Holders of Certificates of any
Class evidencing, as to such Class, Percentage Interests aggregating not less
than 25%; or

         (iii) a decree or order of a court or agency or supervisory authority
having jurisdiction in the premises in an involuntary case under any present or
future federal or state bankruptcy, insolvency or similar law or appointing a
conservator or receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs, shall have been entered against the
Master Servicer and such decree or order shall have remained in force
undischarged or unstayed for a period of 60 days; or

         (iv) the Master Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities, or similar proceedings of, or relating
to, the Master Servicer or of, or relating to, all or substantially all of the
property of the Master Servicer; or

         (v) the Master Servicer shall admit in writing its inability to pay its
debts generally as they become due, file a petition to take advantage of, or
commence a voluntary case under, any applicable insolvency or reorganization
statute, make an assignment for the benefit of its creditors, or voluntarily
suspend payment of its obligations; or

                                       119

<PAGE>

         (vi) the Master Servicer shall notify the Trustee pursuant to Section
4.04(b) that it is unable to deposit in the Certificate Account an amount equal
to the Advance.

If an Event of Default described in clauses (i)-(vi) of this Section shall
occur, then, and in each and every such case, so long as such Event of Default
shall not have been remedied, either the Depositor or the Trustee shall at the
direction of the Insurer (unless an Insurance Default is continuing) or at the
direction of Holders of Certificates entitled to at least 51% of the Voting
Rights (which Voting Rights of the Class A Certificateholders may be exercised
by the Insurer without the consent of such Holders and may only be exercised by
such Holders with the prior written consent of the Insurer so long as there does
not exist a failure by the Insurer to make a required payment under the Policy),
by notice in writing to the Master Servicer (and to the Depositor and the
Insurer if given by the Trustee or to the Trustee and the Insurer if given by
the Depositor), terminate all of the rights and obligations of the Master
Servicer under this Agreement and in and to the Mortgage Loans and the proceeds
thereof, other than its rights as a Certificateholder hereunder; PROVIDED,
HOWEVER, that unless an Insurer Default is continuing the successor to the
Master Servicer appointed pursuant to Section 7.02 shall be acceptable to the
Insurer and shall have accepted the duties of Master Servicer effective upon the
resignation of the Master Servicer. If an Event of Default described in clause
(vi) hereof shall occur, the Trustee with the consent of the Insurer shall, by
notice to the Master Servicer, the Insurer and the Depositor, immediately
terminate all of the rights and obligations of the Master Servicer under this
Agreement and in and to the Mortgage Loans and the proceeds thereof, other than
its rights as a Certificateholder hereunder as provided in Section 4.04(b). On
or after the receipt by the Master Servicer of such written notice, all
authority and power of the Master Servicer under this Agreement, whether with
respect to the Certificates (other than as a Holder thereof) or the Mortgage
Loans or otherwise, shall subject to Section 7.02 pass to and be vested in the
Trustee or the Trustee's designee appointed pursuant to Section 7.02; and,
without limitation, the Trustee is hereby authorized and empowered to execute
and deliver, on behalf of the Master Servicer, as attorney-in- fact or
otherwise, any and all documents and other instruments, and to do or accomplish
all other acts or things necessary or appropriate to effect the purposes of such
notice of termination, whether to complete the transfer and endorsement or
assignment of the Mortgage Loans and related documents, or otherwise. The Master
Servicer agrees to cooperate with the Trustee in effecting the termination of
the Master Servicer's responsibilities and rights hereunder, including, without
limitation, the transfer to the Trustee or its designee for administration by it
of all cash amounts which shall at the time be credited to the Custodial Account
or the Certificate Account or thereafter be received with respect to the
Mortgage Loans. No such termination shall release the Master Servicer for any
liability that it would otherwise have hereunder for any act or omission prior
to the effective time of such termination. Notwithstanding any termination of
the activities of Residential Funding in its capacity as Master Servicer
hereunder, Residential Funding shall be entitled to receive, out of any late
collection of a Monthly Payment on a Mortgage Loan which was due prior to the
notice terminating Residential Funding's rights and obligations as Master
Servicer hereunder and received after such notice, that portion to which
Residential Funding would have been entitled pursuant to Sections 3.10(a)(ii),
(vi) and (vii) as well as its Servicing Fee in respect thereof, and any other
amounts payable to Residential Funding hereunder the entitlement to which arose
prior to the termination of its activities hereunder. Upon the termination of
Residential Funding as Master Servicer hereunder the Depositor shall deliver to
the Trustee a copy of the Program Guide and upon the request of the Insurer, a
copy of the Program Guide to the Insurer.

                                       120

<PAGE>

         Section 7.02.     TRUSTEE OR DEPOSITOR TO ACT; APPOINTMENT OF
                           SUCCESSOR.

         (a) On and after the time the Master Servicer receives a notice of
termination pursuant to Section 7.01 or resigns in accordance with Section 6.04,
the Insurer may appoint a successor Master Servicer and if the Insurer fails to
do so within 30 days, the Trustee or, upon notice to the Insurer and the
Depositor and with the Depositor's and the Insurer's consent (which shall not be
unreasonably withheld) a designee (which meets the standards set forth below) of
the Trustee, shall be the successor in all respects to the Master Servicer in
its capacity as servicer under this Agreement and the transactions set forth or
provided for herein and shall be subject to all the responsibilities, duties and
liabilities relating thereto placed on the Master Servicer (except for the
responsibilities, duties and liabilities contained in Sections 2.02 and 2.03(a),
excluding the duty to notify related Subservicers as set forth in such Sections,
and its obligations to deposit amounts in respect of losses incurred prior to
such notice or termination on the investment of funds in the Custodial Account
or the Certificate Account pursuant to Sections 3.07(c) and 4.01(c) by the terms
and provisions hereof); PROVIDED, HOWEVER, that any failure to perform such
duties or responsibilities caused by the preceding Master Servicer's failure to
provide information required by Section 4.04 shall not be considered a default
by the Trustee hereunder. As compensation therefor, the Trustee shall be
entitled to all funds relating to the Mortgage Loans which the Master Servicer
would have been entitled to charge to the Custodial Account or the Certificate
Account if the Master Servicer had continued to act hereunder and, in addition,
shall be entitled to the income from any Permitted Investments made with amounts
attributable to the Mortgage Loans held in the Custodial Account or the
Certificate Account. If the Trustee has become the successor to the Master
Servicer in accordance with Section 6.04 or Section 7.01, then notwithstanding
the above, the Insurer may appoint a successor Master Servicer and if the
Insurer fails to do so within 30 days, the Trustee may, if it shall be unwilling
to so act, or shall, if it is unable to so act, appoint, or petition a court of
competent jurisdiction to appoint, any established housing and home finance
institution, which is also a Fannie Mae or Freddie Mac-approved mortgage
servicing institution, having a net worth of not less than $10,000,000 as the
successor to the Master Servicer hereunder in the assumption of all or any part
of the responsibilities, duties or liabilities of the Master Servicer hereunder.
Pending appointment of a successor to the Master Servicer hereunder, the Trustee
shall become successor to the Master Servicer and shall act in such capacity as
hereinabove provided. In connection with such appointment and assumption, the
Trustee may make such arrangements for the compensation of such successor out of
payments on Mortgage Loans as it and such successor shall agree; PROVIDED,
HOWEVER, that no such compensation shall be in excess of that permitted the
initial Master Servicer hereunder. The Depositor, the Trustee, the Custodian and
such successor shall take such action, consistent with this Agreement, as shall
be necessary to effectuate any such succession. The Servicing Fee for any
successor Master Servicer appointed pursuant to this Section 7.02 will be
lowered with respect to those Mortgage Loans, if any, where the Subservicing Fee
accrues at a rate of less than 0.50% per annum in the event that the successor
Master Servicer is not servicing such Mortgage Loans directly and it is
necessary to raise the related Subservicing Fee to a rate of 0.50% per annum in
order to hire a Subservicer with respect to such Mortgage Loans.

         (d) In connection with the termination or resignation of the Master
Servicer hereunder, either (i) the successor Master Servicer, including the
Trustee if the Trustee is acting as successor Master Servicer, shall represent
and warrant that it is a member of MERS in good standing and shall agree to
comply in all material respects with the rules and procedures of MERS in
connection with the

                                       121

<PAGE>

servicing of the Mortgage Loans that are registered with MERS, in which case the
predecessor Master Servicer shall cooperate with the successor Master Servicer
in causing MERS to revise its records to reflect the transfer of servicing to
the successor Master Servicer as necessary under MERS' rules and regulations, or
(ii) the predecessor Master Servicer shall cooperate with the successor Master
Servicer in causing MERS to execute and deliver an assignment of Mortgage in
recordable form to transfer the Mortgage from MERS to the Trustee and to execute
and deliver such other notices, documents and other instruments as may be
necessary or desirable to effect a transfer of such Mortgage Loan or servicing
of such Mortgage Loan on the MERS(R) System to the successor Master Servicer.
The predecessor Master Servicer shall file or cause to be filed any such
assignment in the appropriate recording office. The predecessor Master Servicer
shall bear any and all fees of MERS, costs of preparing any assignments of
Mortgage, and fees and costs of filing any assignments of Mortgage that may be
required under this subsection (b). The successor Master Servicer shall cause
such assignment to be delivered to the Trustee or the Custodian promptly upon
receipt of the original with evidence of recording thereon or a copy certified
by the public recording office in which such assignment was recorded.

         Section 7.03.     NOTIFICATION TO CERTIFICATEHOLDERS.

         (a) Upon any such termination or appointment of a successor to the
Master Servicer, the Trustee shall give prompt written notice thereof to the
Insurer and to the Certificateholders at their respective addresses appearing in
the Certificate Register.

         (b) Within 60 days after the occurrence of any Event of Default, the
Trustee shall transmit by mail to all Holders of Certificates and the Insurer
notice of each such Event of Default hereunder known to the Trustee, unless such
Event of Default shall have been cured or waived as provided in Section 7.04
hereof.

         Section 7.04.     WAIVER OF EVENTS OF DEFAULT.

         The Insurer or the Holders representing at least 66% of the Voting
Rights of Certificates affected by a default or Event of Default hereunder may
waive any default or Event of Default, with the written consent of the Insurer,
which consent shall not be unreasonably withheld; PROVIDED, HOWEVER, that (a) a
default or Event of Default under clause (i) of Section 7.01 may be waived with
the written consent of the Insurer, only by all of the Holders of Certificates
affected by such default or Event of Default (which Voting Rights of the Class A
Certificateholders may be exercised by the Insurer without the consent of such
Holders and may only be exercised by such Holders with the prior written consent
of the Insurer so long as there does not exist a failure by the Insurer to make
a required payment under the Policy) and (b) no waiver pursuant to this Section
7.04 shall affect the Holders of Certificates in the manner set forth in Section
11.01(b)(i), (ii) or (iii). Upon any such waiver of a default or Event of
Default by the Insurer or the Holders representing the requisite percentage of
Voting Rights of Certificates affected by such default or Event of Default with
the consent of the Insurer, which consent shall not be unreasonably withheld,
such default or Event of Default shall cease to exist and shall be deemed to
have been remedied for every purpose hereunder. No such waiver shall extend to
any subsequent or other default or Event of Default or impair any right
consequent thereon except to the extent expressly so waived.

                                       122

<PAGE>

         Section 7.05.     SERVICING TRIGGER; REMOVAL OF MASTER SERVICER.

         (a) Upon determination by the Insurer that a Servicing Trigger has
occurred, the Insurer shall give notice of such Servicing Trigger to the Master
Servicer, the Depositor, the Trustee and to each Rating Agency.

         (b) At any time after such determination and while a Servicing Trigger
is continuing, the Insurer may direct the Trustee to remove the Master Servicer
if the Insurer makes a determination that the manner of master servicing was a
factor contributing to the size of the delinquencies or losses incurred in the
Trust Fund.

         (c) Upon receipt of directions to remove the Master Servicer pursuant
to the preceding clause (b), the Trustee shall notify the Master Servicer that
it has been terminated and the Master Servicer shall be terminated in the same
manner as specified in Sections 7.01 and 7.02.

         (d) After notice of occurrence of a Servicing Trigger has been given
and while a Servicing Trigger is continuing, until and unless the Master
Servicer has been removed as provided in clause (b), the Master Servicer
covenants and agrees to act as the Master Servicer for a term from the
occurrence of the Servicing Trigger to the end of the calendar quarter in which
such Servicing Trigger occurs, which term may at the Insurer's discretion be
extended by notice to the Trustee for successive terms of three (3) calendar
months each, until the termination of the Trust Fund. The Master Servicer will,
upon the receipt of each such notice of extension (a "Master Servicer Extension
Notice") become bound for the duration of the term covered by such Master
Servicer Extension Notice to continue as Master Servicer subject to and in
accordance with this Agreement. If, as of the fifteenth (15th) day prior to the
last day of any term as the Master Servicer, the Trustee shall not have received
any Master Servicer Extension Notice from the Insurer, the Trustee shall, within
five (5) days thereafter, give written notice of such \nonreceipt to the Insurer
and the Master Servicer. If any such term expires without a Master Servicer
Extension Notice then the Trustee shall act as Master Servicer as provided in
Section 7.02.

         (e) No provision of this Section 7.05 shall have the effect of limiting
the rights of the Depositor, the Trustee, the Certificateholders or the Insurer
under Section 7.01.

                                       123

<PAGE>

                                  ARTICLE VIII

                             CONCERNING THE TRUSTEE

         Section 8.01.     DUTIES OF TRUSTEE.

         (a) The Trustee, prior to the occurrence of an Event of Default and
after the curing of all Events of Default which may have occurred, undertakes to
perform such duties and only such duties as are specifically set forth in this
Agreement. In case an Event of Default has occurred (which has not 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 investor would exercise or use under the circumstances in the
conduct of such investor'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
conform to the requirements of this Agreement. The Trustee shall notify the
Insurer and the Certificateholders of any such documents which do not materially
conform to the requirements of this Agreement in the event that the Trustee,
after so requesting, does not receive satisfactorily corrected documents. The
Trustee shall forward or cause to be forwarded in a timely fashion the notices,
reports and statements required to be forwarded by the Trustee pursuant to
Sections 4.03, 4.06, 7.03, and 10.01. The Trustee shall furnish in a timely
fashion to the Master Servicer such information as the Master Servicer may
reasonably request from time to time for the Master Servicer to fulfill its
duties as set forth in this Agreement and the Trustee shall furnish in a timely
fashion to the Insurer such information as the Insurer may reasonably request
from time to time for the Insurer to protect its interests and to fulfill its
duties under the Policy. The Trustee covenants and agrees that it shall perform
its obligations hereunder in a manner so as to maintain the status of each of
REMIC I, REMIC II, REMIC III and REMIC IV as a REMIC under the REMIC Provisions
and to prevent the imposition of any federal, state or local income, prohibited
transaction (except as provided in Section 2.04 herein), contribution or other
tax on the Trust Fund to the extent that maintaining such status and avoiding
such taxes are reasonably within the control of the Trustee and are reasonably
within the scope of its duties under this Agreement.

         (c) No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct; PROVIDED, HOWEVER, that:

         (i) Prior to the occurrence of an Event of Default, and after the
curing or waiver of all such Events of Default which may have occurred, the
duties and obligations of the Trustee shall be determined solely by the express
provisions of this Agreement, the Trustee shall not be liable except for the
performance of such duties and obligations as are specifically set forth in this
Agreement, no implied covenants or obligations shall be read into this Agreement
against the Trustee and, in the absence of bad faith on the part of the Trustee,
the Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates or opinions
furnished to the Trustee by the Depositor or the Master Servicer and which on
their face, do not contradict the requirements of this Agreement;

                                       124

<PAGE>

         (ii) The Trustee shall not be personally liable for an error of
judgment made in good faith by a Responsible Officer or Responsible Officers of
the Trustee, unless it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts;

         (iii) The Trustee shall not be personally liable with respect to any
action taken, suffered or omitted to be taken by it in good faith in accordance
with the direction of the Insurer or the Certificateholders holding Certificates
which evidence, Percentage Interests aggregating not less than 25% of the
affected classes 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;

         (iv) The Trustee shall not be charged with knowledge of any default
(other than a default in payment to the Trustee) specified in clauses (i) and
(ii) of Section 7.01 or an Event of Default under clauses (iii), (iv) and (v) of
Section 7.01 unless a Responsible Officer of the Trustee assigned to and working
in the Corporate Trust Office obtains actual knowledge of such failure or event
or the Trustee receives written notice of such failure or event at its Corporate
Trust Office from the Master Servicer, the Insurer, the Depositor or any
Certificateholder; and

         (v) Except to the extent provided in Section 7.02, no provision in this
Agreement shall require the Trustee to expend or risk its own funds (including,
without limitation, the making of any Advance) or otherwise incur any personal
financial liability in the performance of any of its duties as Trustee
hereunder, or in the exercise of any of its rights or powers, if the Trustee
shall have reasonable grounds for believing that repayment of funds or adequate
indemnity against such risk or liability is not reasonably assured to it.

         (d) The Trustee shall timely pay, from its own funds, the amount of any
and all federal, state and local taxes imposed on the Trust Fund or its assets
or transactions including, without limitation, (A) "prohibited transaction"
penalty taxes as defined in Section 860F of the Code, if, when and as the same
shall be due and payable, (B) any tax on contributions to a REMIC after the
Closing Date imposed by Section 860G(d) of the Code and (C) any tax on "net
income from foreclosure property" as defined in Section 860G(c) of the Code, but
only if such taxes arise out of a breach by the Trustee of its obligations
hereunder, which breach constitutes negligence or willful misconduct of the
Trustee.

         Section 8.02.     CERTAIN MATTERS AFFECTING THE TRUSTEE.

         (a) Except as otherwise provided in Section 8.01:

         (i) The Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, Officers' Certificate, certificate of auditors
or any other certificate, statement, instrument, opinion, report, notice,
request, consent, order, appraisal, bond or other paper or document 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 Opinion of Counsel
shall be full and complete authorization and protection in respect of any action
taken or suffered or omitted by it hereunder in good faith and in accordance
with such Opinion of Counsel;

                                       125

<PAGE>

         (iii) The Trustee shall be under no 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 at the request, order or
direction of any of the Certificateholders or the Insurer, pursuant to the
provisions of this Agreement, unless such Certificateholders or the Insurer
shall have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which may be incurred therein or thereby and the
Insurer has given its consent; nothing contained herein shall, however, relieve
the Trustee of the obligation, upon the occurrence of an Event of Default (which
has not been cured), to exercise such of the rights and powers vested in it by
this Agreement, and to use the same degree of care and skill in their exercise
as a prudent investor would exercise or use under the circumstances in the
conduct of such investor's own affairs;

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

         (v) Prior to the occurrence of an Event of Default hereunder and after
the curing of all Events of Default which may have occurred, the Trustee shall
not be bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, bond or other paper or document, unless
requested in writing so to do by the Insurer or the Holders of Certificates of
any Class evidencing, as to such Class, Percentage Interests, aggregating not
less than 50% with the written consent of the Insurer; 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 as a condition to so
proceeding. The reasonable expense of every such examination shall be paid by
the Master Servicer, if an Event of Default shall have occurred and is
continuing, and otherwise by the Certificateholder or the Insurer requesting the
investigation;

         (vi) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys provided that the Trustee shall remain liable for any acts of such
agents or attorneys; and

         (vii) To the extent authorized under the Code and the regulations
promulgated thereunder, each Holder of a Class R Certificate hereby irrevocably
appoints and authorizes the Trustee to be its attorney-in-fact for purposes of
signing any Tax Returns required to be filed on behalf of the Trust Fund. The
Trustee shall sign on behalf of the Trust Fund and deliver to the Master
Servicer in a timely manner any Tax Returns prepared by or on behalf of the
Master Servicer that the Trustee is required to sign as determined by the Master
Servicer pursuant to applicable federal, state or local tax laws, provided that
the Master Servicer shall indemnify the Trustee for signing any such Tax Returns
that contain errors or omissions.

         (b) Following the issuance of the Certificates (and except as provided
for in Section 2.04), the Trustee shall not accept any contribution of assets to
the Trust Fund unless it shall have obtained or been furnished with an Opinion
of Counsel to the effect that such contribution will not (i) cause any of REMIC
I, REMIC II, REMIC III or REMIC IV to fail to qualify as a REMIC at any time
that

                                       126

<PAGE>

any Certificates are outstanding or (ii) cause the Trust Fund to be subject to
any federal tax as a result of such contribution (including the imposition of
any federal tax on "prohibited transactions" imposed under Section 860F(a) of
the Code).

         Section 8.03.     TRUSTEE NOT LIABLE FOR CERTIFICATES OR MORTGAGE
                           LOANS.

         The recitals contained herein and in the Certificates (other than the
execution of the Certificates and relating to the acceptance and receipt of the
Mortgage Loans) shall be taken as the statements of the Depositor or the Master
Servicer as the case may be, and the Trustee assumes no responsibility for their
correctness. The Trustee makes no representations as to the validity or
sufficiency of this Agreement or of the Certificates (except that the
Certificates shall be duly and validly executed and authenticated by it as
Certificate Registrar) or of any Mortgage Loan or related document, or of MERS
or the MERS(R) System. Except as otherwise provided herein, the Trustee shall
not be accountable for the use or application by the Depositor or the Master
Servicer of any of the Certificates or of the proceeds of such Certificates, or
for the use or application of any funds paid to the Depositor or the Master
Servicer in respect of the Mortgage Loans or deposited in or withdrawn from the
Custodial Account or the Certificate Account by the Depositor or the Master
Servicer.

         Section 8.04.     TRUSTEE MAY OWN CERTIFICATES.

         The Trustee in its individual or any other capacity may become the
owner or pledgee of Certificates with the same rights it would have if it were
not Trustee.

         Section 8.05.     MASTER SERVICER TO PAY TRUSTEE'S FEES AND EXPENSES;
                           INDEMNIFICATION.

         (a) The Master Servicer covenants and agrees to pay to the Trustee and
any co-trustee from time to time, and the Trustee and any co-trustee shall be
entitled to, reasonable compensation (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an express trust)
for all services rendered by each of them in the execution of the trusts hereby
created and in the exercise and performance of any of the powers and duties
hereunder of the Trustee and any co- trustee, and the Master Servicer will pay
or reimburse the Trustee and any co-trustee upon request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee or any co-
trustee in accordance with any of the provisions of this Agreement (including
the reasonable compensation and the expenses and disbursements of its counsel
and of all persons not regularly in its employ, and the expenses incurred by the
Trustee or any co-trustee in connection with the appointment of an office or
agency pursuant to Section 8.12) except any such expense, disbursement or
advance as may arise from its negligence or bad faith.

         (b) The Master Servicer agrees to indemnify the Trustee for, and to
hold the Trustee harmless against, any loss, liability or expense incurred
without negligence or willful misconduct on its part, arising out of, or in
connection with, the acceptance and administration of the Trust Fund, including
the costs and expenses (including reasonable legal fees and expenses) of
defending itself against any claim in connection with the exercise or
performance of any of its powers or duties under this Agreement, provided that:

                                       127

<PAGE>

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

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

         (iii) notwithstanding anything in this Agreement to the contrary, the
Master Servicer shall not be liable for settlement of any claim by the Trustee
entered into without the prior consent of the Master Servicer which consent
shall not be unreasonably withheld. No termination of this Agreement shall
affect the obligations created by this Section 8.05(b) of the Master Servicer to
indemnify the Trustee under the conditions and to the extent set forth herein.
Notwithstanding the foregoing, the indemnification provided by the Master
Servicer in this Section 8.05(b) shall not pertain to any loss, liability or
expense of the Trustee, including the costs and expenses of defending itself
against any claim, incurred in connection with any actions taken by the Trustee
at the direction of Certificateholders pursuant to the terms of this Agreement.

         Section 8.06.     ELIGIBILITY REQUIREMENTS FOR TRUSTEE.

         The Trustee hereunder shall at all times be a national banking
association or a New York banking corporation having its principal office in a
state and city acceptable to the Depositor and the Insurer and organized and
doing business under the laws of such state or the United States of America,
authorized under such laws to exercise corporate trust powers, having a combined
capital and surplus of at least $50,000,000 and subject to supervision or
examination by federal or state authority. 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 shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section, the Trustee shall resign immediately in the manner
and with the effect specified in Section 8.07.

         Section 8.07.     RESIGNATION AND REMOVAL OF THE TRUSTEE.

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

         (b) If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 8.06 and shall fail to resign after written
request therefor by the Insurer or the Depositor with the consent of the
Insurer, or if at any time the Trustee shall become incapable of acting, or
shall be

                                       128

<PAGE>

adjudged bankrupt or insolvent, or a receiver of the Trustee or of its property
shall be appointed, or any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then the Insurer or the Depositor with the consent
of the Insurer may remove the Trustee and appoint a successor trustee by written
instrument, in duplicate, one copy of which instrument shall be delivered to the
Trustee so removed and one copy to the successor trustee. In addition, in the
event that the Insurer or the Depositor determines that the Trustee has failed
(i) to distribute or cause to be distributed to Certificateholders any amount
required to be distributed hereunder, if such amount is held by the Trustee or
its Paying Agent (other than the Master Servicer or the Depositor) for
distribution or (ii) to otherwise observe or perform in any material respect any
of its covenants, agreements or obligations hereunder, and such failure shall
continue unremedied for a period of 5 days (in respect of clause (i) above) or
30 days (in respect of clause (ii) above) after the date on which written notice
of such failure, requiring that the same be remedied, shall have been given to
the Trustee by the Depositor or the Insurer, then the Depositor with the consent
of the Insurer, which consent shall not be unreasonably withheld, may remove the
Trustee and appoint a successor trustee by written instrument delivered as
provided in the preceding sentence. In connection with the appointment of a
successor trustee pursuant to the preceding sentence, the Depositor shall, on or
before the date on which any such appointment becomes effective, obtain from
each Rating Agency written confirmation that the appointment of any such
successor trustee will not result in the reduction of the ratings on any class
of the Certificates below the lesser of the then current or original ratings on
such Certificates without taking into account the Policy.

         (c) During the continuance of an Insurer Default, the Holders of
Certificates entitled to at least 51% of the Voting Rights may at any time
remove the Trustee and appoint a successor trustee by written instrument or
instruments, in triplicate, signed by such Holders or their attorneys-in-fact
duly authorized, one complete set of which instruments shall be delivered to the
Depositor, one complete set to the Trustee so removed and one complete set to
the successor so appointed.

         (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 8.08.

         Section 8.08.     SUCCESSOR TRUSTEE.

         (a) Any successor trustee appointed as provided in Section 8.07 shall
execute, acknowledge and deliver to the Depositor and the Insurer 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 shall become effective and such successor
trustee, without any further act, deed or conveyance, shall become fully vested
with all the rights, powers, duties and obligations of its predecessor
hereunder, with the like effect as if originally named as trustee herein. The
predecessor trustee shall deliver to the successor trustee all Mortgage Files
and related documents and statements held by it hereunder (other than any
Mortgage Files at the time held by a Custodian, which shall become the agent of
any successor trustee hereunder), and the Depositor, the Master Servicer and the
predecessor trustee shall execute and deliver such instruments and do such other
things as may reasonably be required for more fully and certainly vesting and
confirming in the successor trustee all such rights, powers, duties and
obligations.

                                       129

<PAGE>

         (b) No successor trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of Section 8.06.

         (c) Upon acceptance of appointment by a successor trustee as provided
in this Section, the Depositor shall mail notice of the succession of such
trustee hereunder to all Holders of Certificates at their addresses as shown in
the Certificate Register. If the Depositor fails to mail such notice within 10
days after acceptance of appointment by the successor trustee, the successor
trustee shall cause such notice to be mailed at the expense of the Depositor.

         Section 8.09.     MERGER OR CONSOLIDATION OF TRUSTEE.

         Any corporation or national banking association into which the Trustee
may be merged or converted or with which it may be consolidated or any
corporation or national banking association resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation or national banking association succeeding to the business of the
Trustee, shall be the successor of the Trustee hereunder, provided such
corporation or national banking association shall be eligible under the
provisions of Section 8.06, 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. The Trustee shall mail notice of any such merger or
consolidation to the Certificateholders at their address as shown in the
Certificate Register.

         Section 8.10.     APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.

         (a) Notwithstanding any other provisions hereof, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Fund or property securing the same may at the time be located, the
Master Servicer and the Trustee acting jointly shall have the power and shall
execute and deliver all instruments to appoint one or more Persons approved by
the Trustee to act as co-trustee or co-trustees, jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust Fund, and
to vest in such Person or Persons, in such capacity, such title to the Trust
Fund, or any part thereof, and, subject to the other provisions of this Section
8.10, such powers, duties, obligations, rights and trusts as the Master Servicer
and the Trustee may consider necessary or desirable. If the Master Servicer
shall not have joined in such appointment within 15 days after the receipt by it
of a request so to do, or in case an Event of Default shall have occurred and be
continuing, the Trustee alone shall have the power to make such appointment. No
co-trustee or separate trustee hereunder shall be required to meet the terms of
eligibility as a successor trustee under Section 8.06 hereunder and no notice to
Holders of Certificates of the appointment of co-trustee(s) or separate
trustee(s) shall be required under Section 8.08 hereof.

         (b) In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 8.10 all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee, and such separate trustee or co-trustee
jointly, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed (whether as Trustee hereunder or
as successor to the Master Servicer hereunder), the Trustee shall be incompetent
or unqualified to perform such act or acts, in which event such rights, powers,
duties and obligations (including the holding of title to the Trust Fund or

                                       130

<PAGE>

any portion thereof in any such jurisdiction) shall be exercised and performed
by such separate trustee or co-trustee at the direction of the Trustee.

         (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 or co-trustee shall refer to this Agreement and the conditions
of this Article VIII. Each separate trustee and co-trustee, upon its acceptance
of the trusts conferred, shall be vested with the estates or property specified
in its instrument of appointment, either jointly with the Trustee or separately,
as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee.

         (d) Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co- trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.

         Section 8.11.     APPOINTMENT OF CUSTODIANS.

         The Trustee may, with the consent of the Master Servicer, the Insurer
and the Depositor, appoint one or more Custodians who are not Affiliates of the
Depositor or the Master Servicer to hold all or a portion of the Mortgage Files
as agent for the Trustee, by entering into a Custodial Agreement. Subject to
Article VIII, the Trustee agrees to comply with the terms of each Custodial
Agreement and to enforce the terms and provisions thereof against the Custodian
for the benefit of the Certificateholders. Each Custodian shall be a depository
institution subject to supervision by federal or state authority, shall have a
combined capital and surplus of at least $15,000,000 and shall be qualified to
do business in the jurisdiction in which it holds any Mortgage File. Each
Custodial Agreement may be amended only as provided in Section 11.01. The
Trustee shall notify the Certificateholders of the appointment of any Custodian
(other than the Custodian appointed as of the Closing Date) pursuant to this
Section 8.11.Section 15.24. Appointment of Office or Agency. The Trustee will
maintain an office or agency in the City of New York where Certificates may be
surrendered for registration of transfer or exchange. The Trustee initially
designates its offices located at 14 Wall Street, 8th Floor, New York, New York
10005 for the purpose of keeping the Certificate Register. The Trustee will
maintain an office at the address stated in Section 11.05(c) hereof where
notices and demands to or upon the Trustee in respect of this Agreement may be
served.

                                       131

<PAGE>

                                   ARTICLE IX

                                   TERMINATION

         Section 9.01.     TERMINATION UPON PURCHASE BY THE MASTER SERVICER OR
                           LIQUIDATION OF ALL MORTGAGE LOANS.

         (a) Subject to Section 9.02, the respective obligations and
responsibilities of the Depositor, the Master Servicer and the Trustee created
hereby in respect of the Certificates (other than the obligation of the Trustee
to make certain payments after the Final Distribution Date to Certificateholders
and the obligation of the Depositor to send certain notices as hereinafter set
forth) shall terminate upon the last action required to be taken by the Trustee
on the Final Distribution Date pursuant to this Article IX following the earlier
of:

         (i) the later of the final payment or other liquidation (or any Advance
with respect thereto) of the last Mortgage Loan remaining in the Trust Fund or
the disposition of all property acquired upon foreclosure or deed in lieu of
foreclosure of any Mortgage Loan, or

         (ii) the purchase by the Master Servicer of all Group I Loans and all
property acquired in respect of any Group I Loan remaining in the Trust Fund
(other than the Policy) and the purchase by the Master Servicer of all Group II
Loans and all property acquired in respect of any Group II Loan remaining in the
Trust Fund (other than the Policy), in each case, at a price equal to 100% of
the unpaid principal balance of each Mortgage Loan (or, if less than such unpaid
principal balance, the fair market value of the related underlying property of
such Mortgage Loan with respect to Mortgage Loans as to which title has been
acquired if such fair market value is less than such unpaid principal balance)
(net of any unreimbursed Advances attributable to principal) on the day of
repurchase, plus accrued interest thereon at the Net Mortgage Rate (or Modified
Net Mortgage Rate in the case of any Modified Mortgage Loan), plus the
Certificate Insurer Premium Modified Rate, to, but not including, the first day
of the month in which such repurchase price is distributed, including the
payment of any amounts due to the Insurer under the Insurance Agreement;
PROVIDED, HOWEVER, that in no event shall the trust created hereby continue
beyond the expiration of 21 years from the death of the last survivor of the
descendants of Joseph P. Kennedy, the late ambassador of the United States to
the Court of St. James, living on the date hereof; provided further, that, if
the amount due under any Certificate shall not have been reduced to zero prior
to the Maturity Date, the Master Servicer shall be required to terminate this
Agreement in accordance with this clause (ii); and provided further, that the
purchase price set forth above shall be increased as is necessary, as determined
by the Master Servicer, to avoid disqualification of any of REMIC I, REMIC II,
REMIC III or REMIC IV as a REMIC.

         The right of the Master Servicer or the Company to purchase all the
assets of the Trust Fund relating to the Group I Loans, pursuant to clause (ii)
above is conditioned upon the date of such purchase occurring on or after the
Group I Optional Termination Date. The right of the Master Servicer or the
Company to purchase all the assets of the Trust Fund relating to the Group II
Loans, pursuant to clause (ii) above is conditioned upon the date of such
purchase occurring on or after the Group II Optional Termination Date. If such
right is exercised by the Master Servicer, the Master Servicer shall be deemed
to have been reimbursed for the full amount of any unreimbursed Advances

                                       132

<PAGE>

theretofore made by it with respect to the Mortgage Loans being purchased. In
addition, the Master Servicer shall provide to the Trustee the certification
required by Section 3.15 and the Trustee and any Custodian shall, promptly
following payment of the purchase price, release to the Master Servicer the
Mortgage Files pertaining to the Mortgage Loans being purchased. No purchase
pursuant to clause (ii) of this Section 9.01(a) is permitted if it would result
in, or if the Insurer can show a reasonable probability that it would result in,
a draw on the Policy unless the Insurer consents in writing.

         In addition to the foregoing, on any Distribution Date on or after the
Group I Optional Termination Date, the Master Servicer shall have the right, at
its option, to purchase the Class A-I Certificates in whole, but not in part, at
a price equal to the sum of the outstanding Certificate Principal Balance of
such Certificates plus the sum of one month's Accrued Certificate Interest
thereon, or, with respect to the Class A-IO Certifciates, on their Notional
Amount, any previously unpaid Accrued Certificate Interest, and any unpaid
Prepayment Interest Shortfall previously allocated thereto, including the
payment of any amounts due to the Insurer under the Insurance Agreement;
PROVIDED, HOWEVER, that no early termination of REMIC I will be permitted if it
would result in, or if the Insurer can show a reasonable probability that it
would result in, a draw under the Policy unless the Insurer consents to the
termination. On any Distribution Date on or after the Group II Optional
Termination Date, the Master Servicer shall have the right, at its option, to
purchase the Class A-II Certificates in whole, but not in part, at a price equal
to the sum of the outstanding Certificate Principal Balance of such Certificates
plus the sum of one month's Accrued Certificate Interest thereon, any previously
unpaid Accrued Certificate Interest, and any unpaid Prepayment Interest
Shortfall previously allocated thereto, including the payment of any amounts due
to the Insurer under the Insurance Agreement; PROVIDED, HOWEVER, that no early
termination of REMIC II will be permitted if it would result in, or if the
Insurer can show a reasonable probability that it would result in, a draw under
the Policy unless the Insurer consents to the termination. If the Master
Servicer exercises this right to purchase the outstanding Class A-I Certificates
or Class A-II Certificates, the Master Servicer will promptly terminate the
respective obligations and responsibilities created hereby in respect of these
Certificates pursuant to this Article IX.

         (b) The Master Servicer shall give the Trustee and the Insurer not less
than 60 days' prior notice of the Distribution Date on which the Master Servicer
anticipates that the final distribution will be made to Certificateholders
(whether as a result of the exercise by the Master Servicer of its right to
purchase the assets of the Trust Fund or otherwise). Notice of any termination,
specifying the anticipated Final Distribution Date (which shall be a date that
would otherwise be a Distribution Date) upon which the Certificateholders may
surrender their Certificates to the Trustee for payment of the final
distribution and cancellation, shall be given promptly by the Master Servicer
(if it is exercising its right to purchase the assets of the Trust Fund), or by
the Trustee (in any other case) by letter to Certificateholders mailed not
earlier than the 15th day and not later than the 25th day of the month next
preceding the month of such final distribution specifying:

         (i) the anticipated Final Distribution Date upon which final payment of
the Certificates is anticipated to be made upon presentation and surrender of
Certificates at the office or agency of the Trustee therein designated,

         (ii) the amount of any such final payment, if known, and

                                       133

<PAGE>

         (iii) that the Record Date otherwise applicable to such Distribution
Date is not applicable, and that payment will be made only upon presentation and
surrender of the Certificates at the office or agency of the Trustee therein
specified.

If the Master Servicer is obligated to give notice to Certificateholders as
aforesaid, it shall give such notice to the Certificate Registrar at the time
such notice is given to Certificateholders. In the event such notice is given by
the Master Servicer, the Master Servicer shall deposit in the Certificate
Account before the Final Distribution Date in immediately available funds an
amount equal to the purchase price for the assets of the Trust Fund computed as
above provided. The Master Servicer shall provide to the Trustee written
notification of any change to the anticipated Final Distribution Date as soon as
practicable. If the Trust Fund is not terminated on the anticipated Final
Distribution Date, for any reason, the Trustee shall promptly mail notice
thereof to each affected Certificateholder.

         (c) Upon presentation and surrender of the Certificates by the
Certificateholders, the Trustee shall distribute to the Certificateholders and
the Insurer (i) the amount otherwise distributable on such Distribution Date, if
not in connection with the Master Servicer's election to repurchase, or (ii) if
the Master Servicer elected to so repurchase, an amount determined as follows:
(A) with respect to the Class A Certificates, the outstanding Certificate
Principal Balance thereof, plus Accrued Certificate Interest thereon for the
related Interest Accrual Period and any previously unpaid Accrued Certificate
Interest, and (B) with respect to the Insurer, any amounts owed to it pursuant
to the Insurance Agreement.

         (d) In the event that any Certificateholders shall not surrender their
Certificates for final payment and cancellation on or before the Final
Distribution Date, the Trustee shall on such date cause all funds in the
Certificate Account not distributed in final distribution to Certificateholders
to be withdrawn therefrom and credited to the remaining Certificateholders by
depositing such funds in a separate escrow account for the benefit of such
Certificateholders, and the Master Servicer (if it exercised its right to
purchase the assets of the Trust Fund), or the Trustee (in any other case) shall
give a second written notice to the remaining Certificateholders to surrender
their Certificates for cancellation and receive the final distribution with
respect thereto. If within six months after the second notice any Certificate
shall not have been surrendered for cancellation, the Trustee shall take
appropriate steps as directed by the Master Servicer to contact the remaining
Certificateholders concerning surrender of their Certificates. The costs and
expenses of maintaining the escrow account and of contacting Certificateholders
shall be paid out of the assets which remain in the escrow account. If within
nine months after the second notice any Certificates shall not have been
surrendered for cancellation, the Trustee shall pay to the Master Servicer all
amounts distributable to the holders thereof and the Master Servicer shall
thereafter hold such amounts until distributed to such holders. No interest
shall accrue or be payable to any Certificateholder on any amount held in the
escrow account or by the Master Servicer as a result of such Certificateholder's
failure to surrender its Certificate(s) for final payment thereof in accordance
with this Section 9.01 and the Certificateholders shall look only to the Master
Servicer for such payment.

         Section 9.02.     ADDITIONAL TERMINATION REQUIREMENTS.

                                       134

<PAGE>

         (a) Each of REMIC I, REMIC II, REMIC III and REMIC IV, as the case may
be, shall be terminated in accordance with the following additional
requirements, unless the Trustee and the Master Servicer have received an
Opinion of Counsel (which Opinion of Counsel shall not be an expense of the
Trustee) to the effect that the failure of any of REMIC I, REMIC II, REMIC III
and REMIC IV, as the case may be, to comply with the requirements of this
Section 9.02 will not (i) result in the imposition on the Trust Fund of taxes on
"prohibited transactions," as described in Section 860F of the Code, or (ii)
cause any of REMIC I, REMIC II, REMIC III or REMIC IV to fail to qualify as a
REMIC at any time that any Certificate is outstanding:

         (i) The Master Servicer shall establish a 90-day liquidation period for
each of REMIC I, REMIC II, REMIC III and REMIC IV, and specify the first day of
such period in a statement attached to the Trust Fund's final Tax Return
pursuant to Treasury regulations Section 1.860F-1. The Master Servicer also
shall satisfy all of the requirements of a qualified liquidation for each of
REMIC I, REMIC II, REMIC III and REMIC IV, under Section 860F of the Code and
the regulations thereunder;

         (ii) The Master Servicer shall notify the Trustee at the commencement
of such 90-day liquidation period and, at or prior to the time of making of the
final payment on the Certificates, the Trustee shall sell or otherwise dispose
of all of the remaining assets of the Trust Fund in accordance with the terms
hereof; and

         (iii) If the Master Servicer is exercising its right to purchase the
assets of the Trust Fund, the Master Servicer shall, during the 90-day
liquidation period and at or prior to the Final Distribution Date, purchase all
of the assets of the Trust Fund for cash;

PROVIDED, HOWEVER, that in the event that a calendar quarter ends after the
commencement of the 90- day liquidation period but prior to the Final
Distribution Date, the Master Servicer shall not purchase any of the assets of
the Trust Fund prior to the close of that calendar quarter.

         (b) Each Holder of a Certificate and the Trustee hereby irrevocably
approves and appoints the Master Servicer as its attorney-in-fact to adopt a
plan of complete liquidation for each of REMIC I, REMIC II, REMIC III and REMIC
IV at the expense of the Trust Fund in accordance with the terms and conditions
of this Agreement.

                                       135

<PAGE>

                                    ARTICLE X

                                REMIC PROVISIONS

         Section 10.01.    REMIC ADMINISTRATION.

         (a) The REMIC Administrator shall make an election to treat each of
REMIC I, REMIC II, REMIC III and REMIC IV as a REMIC under the Code and, if
necessary, under applicable state law. Such election will be made on Form 1066
or other appropriate federal tax or information return (including Form 8811) or
any appropriate state return for the taxable year ending on the last day of the
calendar year in which the Certificates are issued. The REMIC I Regular
Interests shall be designated as the "regular interests" and the Class R-I
Certificates shall be designated as the sole class of "residual interests" in
REMIC I. The REMIC II Regular Interests shall be designated as the "regular
interests" and the Class R-II Certificates shall be designated as the sole class
of "residual interests" in REMIC II. The REMIC III Regular Interests shall be
designated as the "regular interests" and the Class R-III Certificates shall be
designated as the sole class of "residual interests" in REMIC III. The Class
A-I, Class A-II, Class SB-I and Class SB-II Certificates shall be designated as
the "regular interests" in REMIC IV and the Class R-IV Certificates shall be
designated the sole class of "residual interests" in REMIC IV. The REMIC
Administrator and the Trustee shall not permit the creation of any "interests"
(within the meaning of Section 860G of the Code) in the REMIC other than the
Certificates.

         (b) The Closing Date is hereby designated as the "startup day" of each
of REMIC I, REMIC II, REMIC III and REMIC IV within the meaning of Section
860G(a)(9) of the Code.

         (c) The REMIC Administrator shall hold a Class R Certificate in each
REMIC representing a 0.01% Percentage Interest of the Class R Certificates in
each REMIC and shall be designated as the "tax matters person" with respect to
each of REMIC I, REMIC II, REMIC III and REMIC IV in the manner provided under
Treasury regulations section 1.860F-4(d) and Treasury regulations section
301.6231(a)(7)-1. The REMIC Administrator, as tax matters person, shall (i) act
on behalf of each of REMIC I, REMIC II, REMIC III and REMIC IV in relation to
any tax matter or controversy involving the Trust Fund and (ii) 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 legal expenses, including without limitation attorneys' or accountants'
fees, and costs of any such proceeding and any liability resulting therefrom
shall be expenses of the Trust Fund and the REMIC Administrator shall be
entitled to reimbursement therefor out of amounts attributable to the Mortgage
Loans on deposit in the Custodial Account as provided by Section 3.10 unless
such legal expenses and costs are incurred by reason of the REMIC
Administrator's willful misfeasance, bad faith or gross negligence. If the REMIC
Administrator is no longer the Master Servicer hereunder, at its option the
REMIC Administrator may continue its duties as REMIC Administrator and shall be
paid reasonable compensation not to exceed $3,000 per year by any successor
Master Servicer hereunder for so acting as the REMIC Administrator.

         (d) The REMIC Administrator shall prepare or cause to be prepared all
of the Tax Returns that it determines are required with respect to the REMIC
created hereunder and deliver such Tax Returns in a timely manner to the Trustee
and the Trustee shall sign and file such Tax Returns in a

                                       136

<PAGE>

timely manner. The expenses of preparing such returns shall be borne by the
REMIC Administrator without any right of reimbursement therefor. The REMIC
Administrator agrees to indemnify and hold harmless the Trustee with respect to
any tax or liability arising from the Trustee's signing of Tax Returns that
contain errors or omissions. The Trustee and Master Servicer shall promptly
provide the REMIC Administrator with such information as the REMIC Administrator
may from time to time request for the purpose of enabling the REMIC
Administrator to prepare Tax Returns.

         (e) The REMIC Administrator shall provide (i) to any Transferor of a
Class R Certificate such information as is necessary for the application of any
tax relating to the transfer of a Class R Certificate to any Person who is not a
Permitted Transferee, (ii) to the Trustee and the Trustee shall forward to the
Certificateholders such information or reports as are required by the Code or
the REMIC Provisions including reports relating to interest, original issue
discount, if any, and market discount or premium (using the Prepayment
Assumption) and (iii) to the Internal Revenue Service the name, title, address
and telephone number of the person who will serve as the representative of each
REMIC created hereunder.

         (f) The Master Servicer and the REMIC Administrator shall take such
actions and shall cause each REMIC created hereunder to take such actions as are
reasonably within the Master Servicer's or the REMIC Administrator's control and
the scope of its duties more specifically set forth herein as shall be necessary
or desirable to maintain the status thereof as a REMIC under the REMIC
Provisions (and the Trustee shall assist the Master Servicer and the REMIC
Administrator, to the extent reasonably requested by the Master Servicer and the
REMIC Administrator to do so). In performing their duties as more specifically
set forth herein, the Master Servicer and the REMIC Administrator shall not
knowingly or intentionally take any action, cause the Trust Fund to take any
action or fail to take (or fail to cause to be taken) any action reasonably
within their respective control and the scope of duties more specifically set
forth herein, that, under the REMIC Provisions, if taken or not taken, as the
case may be, could (i) endanger the status of any of REMIC I, REMIC II, REMIC
III or REMIC IV as a REMIC or (ii) result in the imposition of a tax upon any of
REMIC I, REMIC II, REMIC III or REMIC IV (including but not limited to the tax
on prohibited transactions as defined in Section 860F(a)(2) of the Code (except
as provided in Section 2.04) and the tax on contributions to a REMIC set forth
in Section 860G(d) of the Code) (either such event, in the absence of an Opinion
of Counsel or the indemnification referred to in this sentence, an "Adverse
REMIC Event") unless the Master Servicer or the REMIC Administrator, as
applicable, has received an Opinion of Counsel (at the expense of the party
seeking to take such action or, if such party fails to pay such expense, and the
Master Servicer or the REMIC Administrator, as applicable, determines that
taking such action is in the best interest of the Trust Fund and the
Certificateholders and is not adverse to the interest of the Insurer, at the
expense of the Trust Fund, but in no event at the expense of the Master
Servicer, the REMIC Administrator or the Trustee) to the effect that the
contemplated action will not, with respect to the Trust Fund created hereunder,
endanger such status or, unless the Master Servicer or the REMIC Administrator
or both, as applicable, determine in its or their sole discretion to indemnify
the Trust Fund against the imposition of such a tax, result in the imposition of
such a tax. Wherever in this Agreement a contemplated action may not be taken
because the timing of such action might result in the imposition of a tax on the
Trust Fund, or may only be taken pursuant to an Opinion of Counsel that such
action would not impose a tax on the Trust Fund, such action may nonetheless be
taken provided that the indemnity given in the preceding sentence with respect
to any taxes that might be

                                       137

<PAGE>

imposed on the Trust Fund has been given and that all other preconditions to the
taking of such action have been satisfied. The Trustee shall not take or fail to
take any action (whether or not authorized hereunder) as to which the Master
Servicer or the REMIC Administrator, as applicable, has advised it in writing
that it has received an Opinion of Counsel to the effect that an Adverse REMIC
Event could occur with respect to such action. In addition, prior to taking any
action with respect to the Trust Fund or its assets, or causing the Trust Fund
to take any action, which is not expressly permitted under the terms of this
Agreement, the Trustee will consult with the Master Servicer or the REMIC
Administrator, as applicable, or its designee, in writing, with respect to
whether such action could cause an Adverse REMIC Event to occur with respect to
the Trust Fund and the Trustee shall not take any such action or cause the Trust
Fund to take any such action as to which the Master Servicer or the REMIC
Administrator, as applicable, has advised it in writing that an Adverse REMIC
Event could occur. The Master Servicer or the REMIC Administrator, as
applicable, may consult with counsel to make such written advice, and the cost
of same shall be borne by the party seeking to take the action not expressly
permitted by this Agreement, but in no event at the expense of the Master
Servicer or the REMIC Administrator. At all times as may be required by the
Code, the Master Servicer or the REMIC Administrator, as applicable, will to the
extent within its control and the scope of its duties more specifically set
forth herein, maintain substantially all of the assets of the REMIC as
"qualified mortgages" as defined in Section 860G(a)(3) of the Code and
"permitted investments" as defined in Section 860G(a)(5) of the Code.

         (g) In the event that any tax is imposed on "prohibited transactions"
of any REMIC created hereunder as defined in Section 860F(a)(2) of the Code, on
"net income from foreclosure property" of any REMIC as defined in Section
860G(c) of the Code, on any contributions to any REMIC after the startup day
therefor pursuant to Section 860G(d) of the Code, or any other tax imposed by
the Code or any applicable provisions of state or local tax laws, such tax shall
be charged (i) to the Master Servicer, if such tax arises out of or results from
a breach by the Master Servicer of any of its obligations under this Agreement
or the Master Servicer has in its sole discretion determined to indemnify the
Trust Fund against such tax, (ii) to the Trustee, if such tax arises out of or
results from a breach by the Trustee of any of its obligations under this
Article X, or (iii) otherwise against amounts on deposit in the Custodial
Account as provided by Section 3.10 and on the Distribution Date(s) following
such reimbursement the aggregate of such taxes shall be allocated in reduction
of the Accrued Certificate Interest on each Class entitled thereto in the same
manner as if such taxes constituted a Prepayment Interest Shortfall.

         (h) The Trustee and the Master Servicer shall, for federal income tax
purposes, maintain books and records with respect to each REMIC on a calendar
year and on an accrual basis or as otherwise may be required by the REMIC
Provisions.

         (i) Following the startup day, neither the Master Servicer nor the
Trustee shall accept any contributions of assets to any REMIC unless (subject to
Section 10.01(f)) the Master Servicer and the Trustee shall have received an
Opinion of Counsel (at the expense of the party seeking to make such
contribution) to the effect that the inclusion of such assets in any REMIC will
not cause any of REMIC I, REMIC II, REMIC III or REMIC IV to fail to qualify as
a REMIC at any time that any Certificates are outstanding or subject any such
REMIC to any tax under the REMIC Provisions or other applicable provisions of
federal, state and local law or ordinances.

                                       138

<PAGE>

         (j) Neither the Master Servicer nor the Trustee shall (subject to
Section 10.01(f)) enter into any arrangement by which any of REMIC I, REMIC II,
REMIC III or REMIC IV will receive a fee or other compensation for services nor
permit any of REMIC I, REMIC II, REMIC III or REMIC IV to receive any income
from assets other than "qualified mortgages" as defined in Section 860G(a)(3) of
the Code or "permitted investments" as defined in Section 860G(a)(5) of the
Code.

         (k) Solely for the purposes of Section 1.860G-1(a)(4)(iii) of the
Treasury Regulations, the "latest possible maturity date" by which the principal
balance of each regular interest in each REMIC would be reduced to zero is
October 25, 2031.

         (l) Within 30 days after the Closing Date, the REMIC Administrator
shall prepare and file with the Internal Revenue Service Form 8811, "Information
Return for Real Estate Mortgage Investment Conduits (REMIC) and Issuers of
Collateralized Debt Obligations" for the Trust Fund.

         (m) Neither the Trustee nor the Master Servicer shall sell, dispose of
or substitute for any of the Mortgage Loans (except in connection with (i) the
default, imminent default or foreclosure of a Mortgage Loan, including but not
limited to, the acquisition or sale of a Mortgaged Property acquired by deed in
lieu of foreclosure, (ii) the bankruptcy of the Trust Fund, (iii) the
termination of any REMIC pursuant to Article IX of this Agreement or (iv) a
purchase of Mortgage Loans pursuant to Article II or III of this Agreement) or
acquire any assets for any REMIC or sell or dispose of any investments in the
Custodial Account or the Certificate Account for gain, or accept any
contributions to any REMIC after the Closing Date unless it has received an
Opinion of Counsel that such sale, disposition, substitution or acquisition will
not (a) affect adversely the status of any of REMIC I, REMIC II, REMIC III or
REMIC IV as a REMIC or (b) unless the Master Servicer has determined in its sole
discretion to indemnify the Trust Fund against such tax, cause any REMIC to be
subject to a tax on "prohibited transactions" or "contributions" pursuant to the
REMIC Provisions. The Trustee shall treat the Reserve Fund as an outside reserve
fund within the meaning of Treasury Regulation 1.860G-2(h). The Reserve Fund
shall be owned by the Class SB-II Certificateholders, and is not an asset of the
REMICs. The Trustee shall treat the rights of the Class A-II Certificateholders
to receive payments from the Reserve Fund as rights in an interest rate cap
contract written by the Class SB-II Certificateholders in favor of the Class
A-II Certificateholders. Thus, each Class A-II Certificate shall be treated as
representing ownership of not only REMIC IV regular interests, but also
ownership of an interest in an interest rate cap contract. For purposes of
determining the issue price of the REMIC IV regular interests, the Trustee shall
assume that the interest rate cap contract with respect to the Class A-II
Certificates has a de minimis value.

         Section 10.02.    MASTER SERVICER, REMIC ADMINISTRATOR AND TRUSTEE
                           INDEMNIFICATION.

         (a) The Trustee agrees to indemnify the Trust Fund, the Insurer, the
Depositor, the REMIC Administrator and the Master Servicer for any taxes and
costs including, without limitation, any reasonable attorneys fees imposed on or
incurred by the Trust Fund, the Insurer, the Depositor or the Master Servicer,
as a result of a breach of the Trustee's covenants set forth in Article VIII or
this Article X. In the event that Residential Funding is no longer the Master
Servicer, the Trustee shall indemnify Residential Funding for any taxes and
costs including, without limitation, any reasonable attorneys fees imposed on or
incurred by Residential Funding as a result of a breach of the Trustee's
covenants set forth in Article VIII or this Article X.

                                       139

<PAGE>

         (b) The REMIC Administrator agrees to indemnify the Trust Fund, the
Insurer, the Depositor, the Master Servicer and the Trustee for any taxes and
costs (including, without limitation, any reasonable attorneys' fees) imposed on
or incurred by the Trust Fund, the Insurer, the Depositor, the Master Servicer
or the Trustee, as a result of a breach of the REMIC Administrator's covenants
set forth in this Article X with respect to compliance with the REMIC
Provisions, including without limitation, any penalties arising from the
Trustee's execution of Tax Returns prepared by the REMIC Administrator that
contain errors or omissions; PROVIDED, HOWEVER, that such liability will not be
imposed to the extent such breach is a result of an error or omission in
information provided to the REMIC Administrator by the Master Servicer in which
case Section 10.02(c) will apply.

         (c) The Master Servicer agrees to indemnify the Trust Fund, the
Insurer, the Depositor, the REMIC Administrator and the Trustee for any taxes
and costs (including, without limitation, any reasonable attorneys' fees)
imposed on or incurred by the Trust Fund, the Insurer, the Depositor or the
Trustee, as a result of a breach of the Master Servicer's covenants set forth in
this Article X or in Article III with respect to compliance with the REMIC
Provisions, including without limitation, any penalties arising from the
Trustee's execution of Tax Returns prepared by the Master Servicer that contain
errors or omissions.

                                       140

<PAGE>

                                   ARTICLE XI

                            MISCELLANEOUS PROVISIONS

         Section 11.01.    AMENDMENT.

         (a) This Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer and the Trustee, with the consent
of the Insurer and without the consent of any of the Certificateholders:

         (i)      to cure any ambiguity,

         (ii)     to correct or supplement any provisions herein or therein,
                  which may be inconsistent with any other provisions herein or
                  therein or to correct any error,

         (iii)    to modify, eliminate or add to any of its provisions to such
                  extent as shall be necessary or desirable to maintain the
                  qualification of REMIC I, REMIC II, REMIC III or REMIC IV as
                  REMICs at all times that any Certificate is outstanding or to
                  avoid or minimize the risk of the imposition of any tax on the
                  Trust Fund pursuant to the Code that would be a claim against
                  the Trust Fund, provided that the Trustee has received an
                  Opinion of Counsel to the effect that (A) such action is
                  necessary or desirable to maintain such qualification or to
                  avoid or minimize the risk of the imposition of any such tax
                  and (B) such action will not adversely affect in any material
                  respect the interests of any Certificateholder,

         (iv)     to change the timing and/or nature of deposits into the
                  Custodial Account or the Certificate Account or to change the
                  name in which the Custodial Account is maintained, provided
                  that (A) the Certificate Account Deposit Date shall in no
                  event be later than the related Distribution Date, (B) such
                  change shall not, as evidenced by an Opinion of Counsel,
                  adversely affect in any material respect the interests of any
                  Certificateholder and (C) such change shall not result in a
                  reduction of the rating assigned to any Class of Certificates
                  below the lower of the then-current rating or the rating
                  assigned to such Certificates as of the Closing Date (without
                  taking into account the Policy), as evidenced by a letter from
                  each Rating Agency to such effect,

         (v)      to modify, eliminate or add to the provisions of Section
                  5.02(f) or any other provision hereof restricting transfer of
                  the Class R Certificates by virtue of their being the
                  "residual interests" in the Trust Fund provided that (A) such
                  change shall not result in reduction of the rating assigned to
                  any such Class of Certificates below the lower of the
                  then-current rating or the rating assigned to such
                  Certificates as of the Closing Date, as evidenced by a letter
                  from each Rating Agency to such effect, and (B) such change
                  shall not, as evidenced by an Opinion of Counsel (at the
                  expense of the party seeking so to modify, eliminate or add
                  such provisions), cause the Trust Fund or any of the
                  Certificateholders (other than the transferor) to be subject
                  to a federal tax caused by a transfer to a Person that is not
                  a Permitted Transferee, or

                                       141

<PAGE>

         (vi)     to make any other provisions with respect to matters or
                  questions arising under this Agreement or such Custodial
                  Agreement which shall not be materially inconsistent with the
                  provisions of this Agreement, provided that such action shall
                  not, as evidenced by an Opinion of Counsel, adversely affect
                  in any material respect the interests of any Certificateholder
                  and is authorized or permitted under Section 11.09(d).

         (b) This Agreement or any Custodial Agreement may also be amended from
time to time with the consent of the Insurer by the Depositor, the Master
Servicer, the Trustee and the Holders of Certificates evidencing in the
aggregate not less than 66% of the Percentage Interests 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
such Custodial Agreement or of modifying in any manner the rights of the Holders
of Certificates of such Class; PROVIDED, HOWEVER, that no such amendment shall:

                  (i) reduce in any manner the amount of, or delay the timing
         of, payments which are required to be distributed on any Certificate
         without the consent of the Holder of such Certificate,

                  (ii) adversely affect in any material respect the interest of
         the Holders of Certificates of any Class in a manner other than as
         described in clause (i) hereof without the consent of Holders of
         Certificates of such Class evidencing, as to such Class, Percentage
         Interests aggregating not less than 66%, or

                  (iii) reduce the aforesaid percentage of Certificates of any
         Class the Holders of which are required to consent to any such
         amendment, in any such case without the consent of the Holders of all
         Certificates of such Class then outstanding.

         (c) Notwithstanding any contrary provision of this Agreement, the
Trustee shall not consent to any amendment to this Agreement unless it shall
have first received an Opinion of Counsel (at the expense of the party seeking
such amendment) to the effect that such amendment or the exercise of any power
granted to the Master Servicer, the Depositor or the Trustee in accordance with
such amendment will not result in the imposition of a federal tax on the Trust
Fund or cause REMIC I, REMIC II, REMIC III or REMIC IV to fail to qualify as
REMICs at any time that any Certificate is outstanding. The Trustee may but
shall not be obligated to enter into any amendment pursuant to this Section that
affects its rights, duties and immunities and this agreement or otherwise;
PROVIDED HOWEVER, such consent shall not be unreasonably withheld.

         (d) Promptly after the execution of any such amendment the Trustee
shall furnish written notification of the substance of such amendment to each
Certificateholder. It shall not be necessary for the consent of
Certificateholders under this Section 11.01 to approve the particular form of
any proposed amendment, but it shall be sufficient if such consent shall approve
the substance thereof. The manner of obtaining such consents and of evidencing
the authorization of the execution thereof by Certificateholders shall be
subject to such reasonable regulations as the Trustee may prescribe.

                                       142

<PAGE>

         (e) The Depositor shall have the option, in its sole discretion, to
obtain and deliver to the Trustee any corporate guaranty, payment obligation,
irrevocable letter of credit, surety bond, insurance policy or similar
instrument or a reserve fund, or any combination of the foregoing, for the
purpose of protecting the Holders of the Class R Certificates against any or all
Realized Losses or other shortfalls. Any such instrument or fund shall be held
by the Trustee for the benefit of the Class R Certificateholders, but shall not
be and shall not be deemed to be under any circumstances included in the REMIC.
To the extent that any such instrument or fund constitutes a reserve fund for
federal income tax purposes, (i) any reserve fund so established shall be an
outside reserve fund and not an asset of the REMIC, (ii) any such reserve fund
shall be owned by the Depositor, and (iii) amounts transferred by the REMIC to
any such reserve fund shall be treated as amounts distributed by the REMIC to
the Depositor or any successor, all within the meaning of Treasury regulations
Section 1.860G-2(h). In connection with the provision of any such instrument or
fund, this Agreement and any provision hereof may be modified, added to, deleted
or otherwise amended in any manner that is related or incidental to such
instrument or fund or the establishment or administration thereof, such
amendment to be made by written instrument executed or consented to by the
Depositor and such related insurer but without the consent of any
Certificateholder and without the consent of the Master Servicer or the Trustee
being required unless any such amendment would impose any additional obligation
on, or otherwise adversely affect the interests of the Certificateholders, the
Master Servicer or the Trustee, as applicable; provided that the Depositor
obtains an Opinion of Counsel (which need not be an opinion of Independent
counsel) to the effect that any such amendment will not cause (a) any federal
tax to be imposed on the Trust Fund, including without limitation, any federal
tax imposed on "prohibited transactions" under Section 860F(a)(1) of the Code or
on "contributions after the startup date" under Section 860G(d)(1) of the Code
and (b) any of REMIC I, REMIC II, REMIC III or REMIC IV to fail to qualify as a
REMIC at any time that any Certificate is outstanding. In the event that the
Depositor elects to provide such coverage in the form of a limited guaranty
provided by General Motors Acceptance Corporation, the Depositor may elect that
the text of such amendment to this Agreement shall be substantially in the form
attached hereto as Exhibit K (in which case Residential Funding's Subordinate
Certificate Loss Obligation as described in such exhibit shall be established by
Residential Funding's consent to such amendment) and that the limited guaranty
shall be executed in the form attached hereto as Exhibit L, with such changes as
the Depositor shall deem to be appropriate; it being understood that the Trustee
has reviewed and approved the content of such forms and that the Trustee's
consent or approval to the use thereof is not required.

         Section 11.02.    RECORDATION OF AGREEMENT; COUNTERPARTS.

         (a) To the extent permitted by applicable law, this Agreement is
subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which any or
all of the properties subject to the Mortgages are situated, and in any other
appropriate public recording office or elsewhere, such recordation to be
effected by the Master Servicer and at its expense on direction by the Trustee
(pursuant to the request of the Insurer or the Holders of Certificates entitled
to at least 25% of the Voting Rights), but only upon direction accompanied by an
Opinion of Counsel to the effect that such recordation materially and
beneficially affects the interests of the Certificateholders.

                                       143

<PAGE>

         (b) For the purpose of facilitating the recordation of this Agreement
as herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.

         Section 11.03.    LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS.

         (a) The death or incapacity of any Certificateholder shall not operate
to terminate this Agreement or the Trust Fund, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting or to
take any action or proceeding in any court for a partition or winding up of the
Trust Fund, nor otherwise affect the rights, obligations and liabilities of any
of the parties hereto.

         (b) No Certificateholder shall have any right to vote (except as
expressly provided herein) or in any manner otherwise control the operation and
management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of the Certificates,
be construed so as to constitute the Certificateholders from time to time as
partners or members 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.

         (c) No Certificateholder shall have any right by virtue of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee and the Insurer a written
notice of default and of the continuance thereof, as hereinbefore provided, and
unless also the Holders of Certificates of any Class evidencing in the aggregate
not less than 25% of the related Percentage Interests of such Class, shall have
made written request upon the Trustee to institute such action, suit or
proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs, expenses
and liabilities to be incurred therein or thereby, and the Insurer shall have
given its written consent and the Trustee, for 60 days after its receipt of such
notice, request and offer of indemnity, shall have neglected or refused to
institute any such action, suit or proceeding it being understood and intended,
and being expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of Certificates
of any Class shall have any right in any manner whatever by virtue of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such Certificates of such Class or any other Class, or
to obtain or seek to obtain priority over or preference to any other such
Holder, or to enforce any right under this Agreement, except in the manner
herein provided and for the common benefit of Certificateholders of such Class
or all Classes, as the case may be. For the protection and enforcement of the
provisions of this Section 11.03, each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or in
equity.

         Section 11.04.    GOVERNING LAW.

         This agreement and the Certificates shall be governed by and construed
in accordance with the laws of the State of New York and the obligations, rights
and remedies of the parties hereunder shall be determined in accordance with
such laws.

                                       144

<PAGE>

         Section 11.05. NOTICES.

         All demands and notices hereunder shall be in writing and shall be
deemed to have been duly given if personally delivered at or mailed by
registered mail, postage prepaid (except for notices to the Trustee which shall
be deemed to have been duly given only when received), to (a) in the case of the
Depositor, 8400 Normandale Lake Boulevard, Suite 250, Minneapolis, Minnesota
55437, Attention: President (RAMP), or such other address as may hereafter be
furnished to the Master Servicer and the Trustee in writing by the Depositor;
(b) in the case of the Master Servicer, 2255 North Ontario Street, Burbank,
California 91504-3120, Attention: Bond Administration or such other address as
may be hereafter furnished to the Depositor and the Trustee by the Master
Servicer in writing; (c) in the case of the Trustee, 1 Bank One Plaza, Suite
IL1-0126, Chicago, Illinois 60670- 0126, Attention: Residential Asset Mortgage
Products Inc. Series 2001-RS3 or such other address as may hereafter be
furnished to the Depositor and the Master Servicer in writing by the Trustee;
(d) in the case of Standard & Poor's, 55 Water Street, New York, New York 10041
Attention: Mortgage Surveillance or such other address as may be hereafter
furnished to the Depositor, Trustee and Master Servicer by Standard & Poor's;
(e) in the case of Moody's, 99 Church Street, New York, New York 10007,
Attention: ABS Monitoring Department, or such other address as may be hereafter
furnished to the Depositor, the Trustee and the Master Servicer in writing by
Moody's; and (f) in the case of the Insurer, Ambac Assurance Corporation, One
State Street Plaza, New York, New York 10004, Attention: Consumer Asset-Backed
Securities Group or such other address as may be hereafter furnished to the
Depositor, the Trustee and the Master Servicer in writing by the Insurer. Any
notice required or permitted to be mailed to a Certificateholder shall be given
by first class mail, postage prepaid, at the address of such holder as shown in
the Certificate Register. Any notice so mailed within the time prescribed in
this Agreement shall be conclusively presumed to have been duly given, whether
or not the Certificateholder receives such notice.

         Section 11.06.    NOTICES TO RATING AGENCIES AND THE INSURER.

         The Depositor, the Master Servicer or the Trustee, as applicable, shall
notify each Rating Agency, the Insurer and each Subservicer at such time as it
is otherwise required pursuant to this Agreement to give notice of the
occurrence of, any of the events described in clause (a), (b), (c), (d), (g),
(h), (i) or (j) below or provide a copy to each Rating Agency and the Insurer at
such time as otherwise required to be delivered pursuant to this Agreement of
any of the statements described in clauses (e) and (f) below:

         (a) a material change or amendment to this Agreement,

         (b) the occurrence of an Event of Default,

         (c) the termination or appointment of a successor Master Servicer or
Trustee or a change in the majority ownership of the Trustee,

         (d) the filing of any claim under the Master Servicer's blanket
fidelity bond and the errors and omissions insurance policy required by Section
3.12 or the cancellation or modification of coverage under 152 any such
instrument,

                                       145

<PAGE>

         (e) the statement required to be delivered to the Holders of each Class
of Certificates pursuant to Section 4.03,

         (f) the statements required to be delivered pursuant to Sections 3.18
and 3.19,

         (g) a change in the location of the Custodial Account or the
Certificate Account,

         (h) the occurrence of any monthly cash flow shortfall to the Holders of
any Class of Certificates resulting from the failure by the Master Servicer to
make an Advance pursuant to Section 4.04,

         (i) the occurrence of the Final Distribution Date, and

         (j) the repurchase of or substitution for any Mortgage Loan, PROVIDED,
HOWEVER, that with respect to notice of the occurrence of the events described
in clauses (d), (g) or (h) above, the Master Servicer shall provide prompt
written notice to each Rating Agency, the Insurer and the Subservicer of any
such event known to the Master Servicer. In addition to the above delivery
requirements, the Depositor, the Master Servicer or the Trustee, as applicable,
shall provide a copy to the Insurer, at such time as it otherwise is required to
deliver pursuant to this Agreement, of any other written confirmation, written
notice or legal opinion.

         Section 11.07.    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 or the
Insurer.

         Section 11.08.    SUPPLEMENTAL PROVISIONS FOR RESECURITIZATION.

         (a) This Agreement may be supplemented by means of the addition of a
separate Article hereto (a "Supplemental Article") for the purpose of
resecuritizing any of the Certificates issued hereunder, under the following
circumstances. With respect to any Class or Classes of Certificates issued
hereunder, or any portion of any such Class, as to which the Depositor or any of
its Affiliates (or any designee thereof) is the registered Holder (the
"Resecuritized Certificates"), the Depositor may deposit such Resecuritized
Certificates into a new REMIC, grantor trust, FASIT or custodial arrangement (a
"Restructuring Vehicle") to be held by the Trustee pursuant to a Supplemental
Article. The instrument adopting such Supplemental Article shall be executed by
153 the Depositor, the Master Servicer and the Trustee; provided, that neither
the Master Servicer nor the Trustee shall withhold their consent thereto if
their respective interests would not be materially adversely affected thereby.
To the extent that the terms of the Supplemental Article do not in any way
affect any provisions of this Agreement as to any of the Certificates initially
issued hereunder, the adoption of the Supplemental Article shall not constitute
an "amendment" of this Agreement. Each Supplemental Article shall set forth all
necessary provisions relating to the holding of the Resecuritized Certificates
by the Trustee, the establishment of the Restructuring Vehicle, the issuing of
various classes of new

                                       146

<PAGE>

certificates by the Restructuring Vehicle and the distributions to be made
thereon, and any other provisions necessary to the purposes thereof. In
connection with each Supplemental Article, the Depositor shall deliver to the
Trustee an Opinion of Counsel to the effect that (i) the Restructuring Vehicle
will qualify as a REMIC, grantor trust, FASIT or other entity not subject to
taxation for federal income tax purposes and (ii) the adoption of the
Supplemental Article will not endanger the status of any of REMIC I, REMIC II,
REMIC III or REMIC IV as a REMIC or result in the imposition of a tax upon the
Trust Fund (including but not limited to the tax on prohibited transaction as
defined in Section 860F(a)(2) of the Code and the tax on contributions to a
REMIC as set forth in Section 860G(d) of the Code.

         Section 11.09.    RIGHTS OF THE INSURER.

         (a) The Insurer is an express third-party beneficiary of this
Agreement.

         (b) On each Distribution Date the Trustee shall forward to the Insurer
a copy of the reports furnished to the Class A Certificateholders and the
Depositor on such Distribution Date.

         (c) The Trustee shall provide to the Insurer copies of any report,
notice, Opinion of counsel, Officers' Certificate, request for consent or
request for amendment to any document related hereto promptly upon the Trustee's
production or receipt thereof.

         (d) Unless an Insurer Default exists, the Trustee and the Depositor
shall not agree to any amendment to this Agreement without first having obtained
the prior written consent of the Insurer, which consent shall not be
unreasonably withheld.

         (e) So long as there does not exist a failure by the Insurer to make a
required payment under the Policy, the Insurer shall have the right to exercise
all rights of the Holders of the Class A Certificates under this Agreement
without any consent of such Holders, and such Holders may exercise such rights
only with the prior written consent of the Insurer, except as provided herein.

         (f) The Insurer shall not be entitled to exercise any of its rights
hereunder so long as there exists a failure by the Insurer to make a required
payment under the Policy.

                                       147

<PAGE>

         IN WITNESS WHEREOF, the Company, the Master Servicer and the Trustee
have caused their names to be signed hereto by their respective officers
thereunto duly authorized and their respective seals, duly attested, to be
hereunto affixed, all as of the day and year first above written.

[Seal]                                      RESIDENTIAL ASSET MORTGAGE
                                            PRODUCTS, INC.

Attest:                                     By:
        ----------------------------           ---------------------------------
         Name:                                 Name:
         Title:  Vice President                Title:    Vice President

[Seal]
                                            RESIDENTIAL FUNDING CORPORATION

Attest:                                     By:
        ----------------------------           ---------------------------------
         Name:                                 Name:
         Title:   Director                     Title:    Director

[Seal]                                      BANK ONE, NATIONAL ASSOCIATION
                                                         as Trustee

Attest:                                     By:
        ----------------------------           ---------------------------------
         Name:                                 Name:
         Title:                                Title:    Vice President

                                       148

<PAGE>

STATE OF MINNESOTA       )
                         ) ss.:
COUNTY OF HENNEPIN       )

                  On the 30th day of October, 2001 before me, a notary public in
and for said State, personally appeared _____________, known to me to be a Vice
President of Residential Asset Mortgage Products, Inc., one of the corporations
that executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.

                  IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.

                                                               Notary Public

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

[Notarial Seal]

<PAGE>

STATE OF MINNESOTA      )
                        ) ss.:
COUNTY OF HENNEPIN      )

                  On the 30th day of October, 2001 before me, a notary public in
and for said State, personally appeared ________________, known to me to be a
Director of Residential Funding Corporation, one of the corporations that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.

                  IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.

                                                              Notary Public

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

[Notarial Seal]

<PAGE>

STATE OF                 )
                         ) ss.:
COUNTY OF                )

                  On the 30th day of October, 2001 before me, a notary public in
and for said State, personally appeared ________________, known to me to be a
Vice President of Bank One, National Association, a national banking association
that executed the within instrument, and also known to me to be the person who
executed it on behalf of said banking corporation and acknowledged to me that
such banking corporation executed the within instrument.

                  IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.

                                                             Notary Public

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

[Notarial Seal]RESIDENTIAL FUNDING MORTGAGE SECURITIES I, INC.,
                                    Company,

                        RESIDENTIAL FUNDING CORPORATION,
                                Master Servicer,

                                       and
                         BANK ONE, NATIONAL ASSOCIATION,
                                     Trustee

                               SERIES SUPPLEMENT,
                          DATED AS OF OCTOBER 1, 2001,

                                       TO

                                STANDARD TERMS OF
                         POOLING AND SERVICING AGREEMENT

                            Dated as of July 1, 2001

                       Mortgage Pass-Through Certificates

                                 Series 2001-S23

<PAGE>

<TABLE>
<CAPTION>
                                                 TABLE OF CONTENTS

                                                                                                               Page
<S>                                                                                                            <C>
                                                     ARTICLE I

                                                    DEFINITIONS
         Section 1.01      Definitions............................................................................6
         Section 1.02      Use of Words and Phrases..............................................................29
         Section 1.03      Determination of LIBOR................................................................29

                                                    ARTICLE II

                                           CONVEYANCE OF MORTGAGE LOANS;
                                         ORIGINAL ISSUANCE OF CERTIFICATES
         Section 2.01      Conveyance of Mortgage Loans.  (See Section 2.01 of the
                           Standard Terms).......................................................................30
         Section 2.02      Acceptance by Trustee.  (See Section 2.02 of the Standard Terms)......................30
         Section 2.03      Representations, Warranties and Covenants of the Master Servicer and the
                           Company...............................................................................30
         Section 2.04      Representations and Warranties of Sellers. (See Section 2.04 of the Standard
                           Terms)................................................................................33
         Section 2.05      Execution and Authentication of Certificates..........................................33
         Section 2.06      Conveyance of Uncertificated REMIC I and REMIC II Regular Interests;
                           Acceptance by the Trustee.............................................................33
         Section 2.07      Issuance of Certificates Evidencing Interest in REMIC III.............................34

                                                    ARTICLE III

                                           ADMINISTRATION AND SERVICING
                                                 OF MORTGAGE LOANS

                                                    ARTICLE IV

                                          PAYMENTS TO CERTIFICATEHOLDERS
         Section 4.01      Certificate Account.  (See Section 4.01 of the Standard Terms)........................35
         Section 4.02      Distributions.........................................................................35
         Section 4.03      Statements to Certificateholders.  (See Section 4.03(a) through (d) of the
                           Standard Terms and Exhibit Four attached hereto)......................................51
         Section 4.04      Distribution of Reports to the Trustee and the Company; Advances by the
                           Master Servicer. (See Section 4.04 of the Standard Terms).............................51
         Section 4.05      Allocation of Realized Losses.........................................................51

<PAGE>

         Section 4.06      Reports of Foreclosures and Abandonment of Mortgaged Property.  (See
                           Section 4.06 of the Standard Terms)...................................................53
         Section 4.07      Optional Purchase of Defaulted Mortgage Loans.  (See Section 4.07 of the
                           Standard Terms).......................................................................53
         Section 4.08      Surety Bond.  (See Section 4.08 of the Standard Terms)................................53
         Section 4.09      Distributions on the Uncertificated REMIC I Regular Interests.........................53
         Section 4.10      Distributions on the Uncertificated REMIC II Regular Interests........................53
         Section 4.11      Distributions on the Uncertificated Class A-V REMIC Regular
                           Interests.............................................................................55

                                                     ARTICLE V

                                                 THE CERTIFICATES
         Section 5.01.     The Certificates.  (See Section 5.01 of the Standard Terms)...........................56
         Section 5.02.     Registration of Transfer and Exchange of Certificates.................................56
         Section 5.03.     Mutilated, Destroyed, Lost or Stolen Certificates.  (See Section 5.03 of the
                           Standard Terms).......................................................................56
         Section 5.04.     Persons Deemed Owners.  (See Section 5.04 of the Standard Terms)......................56
         Section 5.05.     Appointment of Paying Agent.  (See Section 5.05 of the Standard
                           Terms)................................................................................56

                                                    ARTICLE VI

                                        THE COMPANY AND THE MASTER SERVICER

                                                    ARTICLE VII

                                                      DEFAULT

                                                   ARTICLE VIII

                                              CONCERNING THE TRUSTEE

                                                    ARTICLE IX

                                                    TERMINATION

                                                     ARTICLE X

                                                 REMIC PROVISIONS
         Section 10.01     REMIC Administration.  (See Section 10.01 of the Standard Terms)......................61
         Section 10.02     Master Servicer; REMIC Administrator and Trustee Indemnification.  (See
                           Section 10.02 of the  Standard Terms).................................................61
         Section 10.03     Designation of REMIC(s)...............................................................61

<PAGE>

         Section 10.04     [Reserved]............................................................................61
         Section 10.05     Compliance with Withholding Requirements..............................................61

                                                    ARTICLE XI

                                             MISCELLANEOUS PROVISIONS
         Section 11.01     Amendment.  (See Section 11.01 of the Standard Terms).................................62
         Section 11.02     Recordation of Agreement.  Counterparts.  (See Section 11.02 of the Standard
                           Terms)................................................................................62
         Section 11.03     Limitation on Rights of Certificateholders.  (See Section 11.03 of the
                           Standard Terms).......................................................................62
         Section 11.04     Governing Laws.  (See Section 11.04 of the Standard Terms)............................62
         Section 11.05     Notices...............................................................................62
         Section 11.06     Required Notices to Rating Agency and Subservicer.  (See Section 11.06 of
                           the Standard Terms)...................................................................63
         Section 11.07     Severability of Provisions. (See Section 11.07 of the Standard Terms).................63
         Section 11.08     Supplemental Provisions for Resecuritization.  (See Section 11.08 of the
                           Standard Terms).......................................................................63
         Section 11.09     Allocation of Voting Rights...........................................................63

                                                    ARTICLE XII

                                                    [RESERVED]
</TABLE>

<PAGE>

EXHIBITS

Exhibit One:               Mortgage Loan Schedule for Loan Group 1
Exhibit Two:               Mortgage Loan Schedule for Loan Group 2
Exhibit Three:             Schedule of Discount Fractions
Exhibit Four:              Information to be Included in
                           Monthly Distribution Date Statement
Exhibit Five:              Standard Terms of Pooling and Servicing
                           Agreement dated as of July 1, 2001
Exhibit Six:               Aggregate Planned Principal Balances

<PAGE>

         This is a Series Supplement, dated as of October 1, 2001 (the "Series
Supplement"), to the Standard Terms of Pooling and Servicing Agreement, dated as
of July 1, 2001 and attached as Exhibit Five hereto (the "Standard Terms" and,
together with this Series Supplement, the "Pooling and Servicing Agreement" or
"Agreement"), among RESIDENTIAL FUNDING MORTGAGE SECURITIES I, INC., as the
company (together with its permitted successors and assigns, the "Company"),
RESIDENTIAL FUNDING CORPORATION, as master servicer (together with its permitted
successors and assigns, the "Master Servicer"), and BANK ONE, NATIONAL
ASSOCIATION, as Trustee (together with its permitted successors and assigns, the
"Trustee").

                              PRELIMINARY STATEMENT

         The Company intends to sell Mortgage Pass-Through Certificates
(collectively, the "Certificates"), to be issued hereunder in multiple classes,
which in the aggregate will evidence the entire beneficial ownership interest in
the Trust Fund. As provided herein, the REMIC Administrator will make an
election to treat the entire segregated pool of assets described in the
definition of REMIC I (as defined herein), and subject to this Agreement
(including the Mortgage Loans but excluding the Initial Monthly Payment Fund),
as a real estate mortgage investment conduit (a "REMIC") for federal income tax
purposes and such segregated pool of assets will be designated as "REMIC I." The
Uncertificated REMIC I Regular Interests will be "regular interests" in REMIC I
and the Class R-I Certificates will be the sole class of "residual interests" in
REMIC I for purposes of the REMIC Provisions (as defined herein). A segregated
pool of assets consisting of the Uncertificated REMIC I Regular Interests will
be designated as "REMIC II" and the REMIC Administrator will make a separate
REMIC election with respect thereto. The Uncertificated REMIC II Regular
Interests will be "regular interests" in REMIC II and the Class R-II
Certificates will be the sole class of "residual interests" in REMIC II for
purposes of the REMIC Provisions. A segregated pool of assets consisting of the
Uncertificated REMIC II Regular Interests will be designated as "REMIC III" and
the REMIC Administrator will make a separate REMIC election with respect
thereto. The Class 1-A-1 Certificates, Class 1-A-2 Certificates, Class 1-A-3
Certificates, Class 1-A-4 Certificates, Class 1-A-5 Certificates, Class 1-A-6
Certificates, Class 1-A-7 Certificates, Class 1-A-8 Certificates, Class 1-A-9
Certificates, Class 1-A-10 Certificates, Class 1-A-11 Certificates, Class 1-A-12
Certificates, Class 1-A-13 Certificates, Class 1-A-14 Certificates, Class 1-A-15
Certificates, Class 1-A-16 Certificates, Class 1-A-17 Certificates, Class 1-A-18
Certificates, Class 1-A-19 Certificates, Class 1-A-20 Certificates, Class 1-A-P
Certificates, Class 2- A-1 Certificates, Class 2-A-2 Certificates, Class 2-A-3
Certificates, Class 2-A-4 Certificates, Class 2-A-5 Certificates, Class 2-A-6
Certificates, Class 2-A-7 Certificates, Class 2-A-8 Certificates, Class 2-A-9
Certificates, Class 2-A-10 Certificates, Class 2-A-11 Certificates, Class 2-A-12
Certificates, Class 2-A-13 Certificates, Class 2-A-P Certificates, Class M-1
Certificates, Class M-2 Certificates, Class M-3 Certificates, Class B-1
Certificates, Class B-2 Certificates, Class B-3 Certificates, Uncertificated
Class 1-A-V REMIC Regular Interests and Uncertificated Class 2-A-V REMIC Regular
Interests will be "regular interests" in REMIC III and the Class R-III
Certificates will be the sole class of "residual interests" therein for purposes
of the REMIC Provisions. The Class 1-A-V and Class 2-A-V Certificates will
represent the entire beneficial ownership interest in the Uncertificated Class
1-A-V REMIC Regular Interests and the Uncertificated Class 2-A-V

<PAGE>

REMIC Regular Interests, respectively.

         The terms and provisions of the Standard Terms are hereby incorporated
by reference herein as though set forth in full herein. If any term or provision
contained herein shall conflict with or be inconsistent with any provision
contained in the Standard Terms, the terms and provisions of this Series
Supplement shall govern. Any cross-reference to a section of the Pooling and
Servicing Agreement, to the extent the terms of the Standard Terms and Series
Supplement conflict with respect to that section, shall be a cross-reference to
the related section of the Series Supplement. All capitalized terms not
otherwise defined herein shall have the meanings set forth in the Standard
Terms. The Pooling and Servicing Agreement shall be dated as of the date of the
Series Supplement.

         The following table irrevocably sets forth the designation, the
Uncertificated REMIC I Pass- Through Rate, the initial Uncertificated Principal
Balance, and solely for purposes of satisfying Treasury regulation Section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for each of the
Uncertificated REMIC I Regular Interests. None of the Uncertificated REMIC I
Regular Interests will be certificated.

<TABLE>
<CAPTION>
                                  Uncertificated
                                   REMIC I Pass-         Initial Uncertificated                Latest
         Designation               Through Rate             Principal Balance           Possible Maturity(1)
         -----------               ------------             -----------------           --------------------
<S>                               <C>                 <C>                               <C>
  REMIC I Regular Interest             6.75%          $       412,464,927.00              October 25, 2031
            LT-1A
  REMIC I Regular Interest             6.50%          $       129,069,962.95              October 25, 2031
            LT-2A
  REMIC I Regular Interest             6.50%          $               100.00              October 25, 2031
            LT-2R
  REMIC I Regular Interest             0.00%          $         1,136,409.09              October 25, 2031
            LT-1P
  REMIC I Regular Interest             0.00%          $            11,377.14              October 25, 2031
            LT-2P
       REMIC I Group 1                  (2)                           N/A (3)             October 25, 2031
      Regular Interests
       REMIC I Group 2                  (2)                           N/A (3)             October 25, 2031
      Regular Interests
</TABLE>

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

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

(3)      The REMIC I Group 1 IO Regular Interests and REMIC I Group 2 IO Regular
         Interests have no Uncertificated Principal Balance.

The following table irrevocably sets forth the designation, the Uncertificated
REMIC II Pass-

                                       -2-

<PAGE>

Through Rate, the initial Uncertificated Principal Balance, and solely for
purposes of satisfying Treasury regulation Section 1.860G-1(a)(4)(iii), the
"latest possible maturity date" for each of the REMIC I Regular Interests. None
of the Uncertificated REMIC II Regular Interests will be certificated.

<TABLE>
<CAPTION>
                                   Uncertificated
                                      REMIC I
                                    Pass-Through         Initial Uncertificated                Latest
         Designation                    Rate                Principal Balance           Possible Maturity(1)
         -----------                    ----                -----------------           --------------------
<S>                                <C>                <C>                               <C>
  REMIC II Regular Interest         Variable (2)      $                   1,240.89        October 25, 2031
           MT-1SUB
  REMIC II Regular Interest            6.75%          $                  41,246.49        October 25, 2031
           MT-1Pool
  REMIC II Regular Interest         Variable (2)      $                     387.29        October 25, 2031
           MT-2SUB
  REMIC II Regular Interest            6.50%          $                  12,907.01        October 25, 2031
           MT-2Pool
  REMIC II Regular Interest         Variable (2)      $             319,898,108.27        October 25, 2031
             MT-X
  REMIC II Regular Interest         Variable (2)      $              35,000,000.00        October 25, 2031
            MT-1A1
  REMIC II Regular Interest         Variable (2)      $              25,000,000.00        October 25, 2031
            MT-1A3
  REMIC II Regular Interest         Variable (2)      $               8,000,000.00        October 25, 2031
            MT-1A5
  REMIC II Regular Interest         Variable (2)      $               2,000,000.00        October 25, 2031
            MT-1A6
  REMIC II Regular Interest         Variable (2)      $               1,882,000.00        October 25, 2031
            MT-1A9
  REMIC II Regular Interest         Variable (2)      $               1,412,000.00        October 25, 2031
           MT-1A10
  REMIC II Regular Interest         Variable (2)      $               2,353,000.00        October 25, 2031
           MT-1A11
  REMIC II Regular Interest         Variable (2)      $               1,412,000.00        October 25, 2031
           MT-1A12
  REMIC II Regular Interest         Variable (2)      $               1,832,000.00        October 25, 2031
           MT-1A13
  REMIC II Regular Interest         Variable (2)      $              46,104,000.00        October 25, 2031
           MT-1A14
  REMIC II Regular Interest         Variable (2)      $              38,017,000.00        October 25, 2031
           MT-1A15
  REMIC II Regular Interest         Variable (2)      $              14,193,000.00        October 25, 2031
            MT-2A1
  REMIC II Regular Interest         Variable (2)      $              25,000,000.00        October 25, 2031
            MT-2A4
  REMIC II Regular Interest         Variable (2)      $              19,376,000.00        October 25, 2031
           MT-2A13
  REMIC II Regular Interest            0.00%          $               1,136,409.09        October 25, 2031
              Y

                                       -3-

<PAGE>

  REMIC II Regular Interest            0.00%          $                  11,377.14        October 25, 2031
              Z
     REMIC II Group 1 IO            Variable (2)      $                    N/A (3)        October 25, 2031
      Regular Interests
     REMIC II Group 2 IO            Variable (2)      $                    N/A (3)        October 25, 2031
      Regular Interests
  REMIC II Regular Interest         Variable (2)      $                    N/A (3)        October 25, 2031
            MT-IO
</TABLE>

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

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

(3)      The REMIC II Group 1 IO Regular Interests, the REMIC II Group 2 IO
         Regular Interests and REMIC II Regular Interest MT- IO have no
         Uncertificated Principal Balance.

         The following table sets forth the designation, type, Pass-Through
Rate, aggregate Initial Certificate Principal Balance, Maturity Date, initial
ratings and certain features for each Class of Certificates comprising the
interests in the Trust Fund created hereunder.

                                       -4-

<PAGE>

<TABLE>
<CAPTION>
                                     Aggregate
                                      Initial
                                    Certificate
                  Pass-Through       Principal                                       Maturity                           Minimum
  Designation         Rate            Balance              Features (1)                Date          Fitch/S&P     Denominations (2)
<S>               <C>            <C>                 <C>                         <C>                 <C>           <C>
Class 1-A-1           4.45%      $35,000,000.00       Senior/PAC/Fixed Rate      October 25, 2031     AAA/AAA           $25,000
Class 1-A-2           6.75%      $53,648,000.00         Senior/Fixed Rate        October 25, 2031     AAA/AAA           $25,000
Class 1-A-3           6.25%      $25,000,000.00         Senior/Fixed Rate        October 25, 2031     AAA/AAA           $25,000
                                                              Super
                                                       Senior/Lockout/Fixed
Class 1-A-4           6.75%      $40,850,000.00                Rate              October 25, 2031     AAA/AAA           $25,000
Class 1-A-5           6.50%      $8,000,000.00       Senior/Retail/Fixed Rate    October 25, 2031     AAA/AAA           $1,000
Class 1-A-6           6.50%      $2,000,000.00       Senior/Retail/Fixed Rate    October 25, 2031     AAA/AAA           $1,000
                                                         Senior/Floater/
                   Adjustable                          Companion/Adjustable
Class 1-A-7         Rate (3)     $112,007,117.00               Rate              October 25, 2031     AAA/AAA           $25,000
                                                          Senior/Inverse
                   Adjustable                           Floater/Companion/
Class 1-A-8         Rate (3)     $29,038,883.00          Adjustable Rate         October 25, 2031     AAA/AAA           $25,000
Class 1-A-9           6.50%      $1,882,000.00       Senior/Retail/Fixed Rate    October 25, 2031     AAA/AAA           $1,000
Class 1-A-10          6.50%      $1,412,000.00       Senior/Retail/Fixed Rate    October 25, 2031     AAA/AAA           $1,000
Class 1-A-11          6.50%      $2,353,000.00       Senior/Retail/Fixed Rate    October 25, 2031     AAA/AAA           $1,000
Class 1-A-12          6.50%      $1,412,000.00       Senior/Retail/Fixed Rate    October 25, 2031     AAA/AAA           $1,000
Class 1-A-13          6.50%      $1,832,000.00       Senior/Retail/Fixed Rate    October 25, 2031     AAA/AAA           $1,000
Class 1-A-14          6.00%      $46,104,000.00       Senior/PAC/Fixed Rate      October 25, 2031     AAA/AAA           $25,000
Class 1-A-15          5.50%      $39,017,000.00       Senior/PAC/Fixed Rate      October 25, 2031     AAA/AAA           $25,000

--------
(1)      The Class 1-A-1, Class 1-A-2, Class 1-A-3, Class 1-A-4, Class 1-A-5,
         Class 1-A-6, Class 1-A-7, Class 1-A-8, Class 2-A-1, Class 2-A-2, Class
         2-A-3, Class 2-A-4, Class 2-A-5, Class 2-A-6 and Class M Certificates
         shall be Book-Entry Certificates. The Class A-P, Class A-V, Class R and
         Class B Certificates shall be delivered to the holders thereof in
         physical form.

(2)      The Certificates, other than the Class 1-A-6, Class A-V and Class R
         Certificates, shall be issuable in minimum dollar denominations as
         indicated above (by Certificate Principal Balance or Notional Amount,
         as applicable) and integral multiples of $1 (or $1,000 in the case of
         the Class A-P, Class B-1, Class B-2 and Class B-3 Certificates) in
         excess thereof, except that one Certificate of any of the Certificates
         that contains an uneven multiple of $1,000 shall be issued in a
         denomination equal to the sum of the related minimum denomination set
         forth above and such uneven multiple for such Class or the sum of such
         denomination and an integral multiple of $1,000. The Class 1-A-6
         Certificates shall be issuable in minimum denominations of not less
         than a 10% Percentage Interest. The Class R Certificates and Class A-V
         Certificates shall be issuable in minimum denominations of not less
         than a 20% Percentage Interest; PROVIDED, HOWEVER, that one Class R
         Certificate will be issuable to Residential Funding as "tax matters
         person" pursuant to Section 10.01(c) and (e) in a minimum denomination
         representing a Percentage Interest of not less than 0.01%.

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

                                       -5-

<PAGE>

                                                         Senior/Interest
Class 1-A-16          6.75%      $0.00                   Only/Fixed Rate         October 25, 2031     AAA/AAA           $25,000
                                                         Senior/Interest
Class 1-A-17          6.75%      $0.00                   Only/Fixed Rate         October 25, 2031     AAA/AAA           $25,000
                                                         Senior/Interest
Class 1-A-18          6.75%      $0.00                   Only/Fixed Rate         October 25, 2031     AAA/AAA           $25,000
                                                         Senior/Interest
Class 1-A-19          6.75%      $0.00                   Only/Fixed Rate         October 25, 2031     AAA/AAA           $25,000
                                                              Senior
                                                      Support/Lockout/Fixed
Class 1-A-20          6.75%      $500,000.00                   Rate              October 25, 2031     AAA/AAA           $25,000
Class 2-A-1           5.50%      $14,193,000.00       Senior/PAC/Fixed Rate      October 25, 2031     AAA/AAA           $25,000
                                                         Senior/Floater/
                   Adjustable                          Companion/Adjustable
Class 2-A-2         Rate (3)     $27,657,882.00                Rate              October 25, 2031     AAA/AAA           $25,000
                                                     Senior/Inverse Floater/
                   Adjustable                          Companion/Adjustable
Class 2-A-3         Rate (3)     $8,510,118.00                 Rate              October 25, 2031     AAA/AAA           $25,000
Class 2-A-4           5.75%      $25,000,000.00         Senior/Fixed Rate        October 25, 2031     AAA/AAA           $25,000
                                                         Senior/Interest
Class 2-A-5           6.50%      $0.00                   Only/Fixed Rate         October 25, 2031     AAA/AAA           $25,000
Class 2-A-6           6.50%      $12,612,000.00         Senior/Fixed Rate        October 25, 2031     AAA/AAA           $25,000
Class 2-A-7           6.75%      $1,150,000.00       Senior/Retail/Fixed Rate    October 25, 2031     AAA/AAA           $1,000
Class 2-A-8           6.25%      $1,150,000.00       Senior/Retail/Fixed Rate    October 25, 2031     AAA/AAA           $1,000
Class 2-A-9           6.75%      $1,297,500.00       Senior/Retail/Fixed Rate    October 25, 2031     AAA/AAA           $1,000
Class 2-A-10          6.25%      $1,297,500.00       Senior/Retail/Fixed Rate    October 25, 2031     AAA/AAA           $1,000
                                                         Senior/Interest
Class 2-A-11          6.50%      $0.00                   Only/Fixed Rate         October 25, 2031     AAA/AAA           $25,000
                                                       Senior/Lockout/Fixed
Class 2-A-12          6.50%      $12,953,000.00                Rate              October 25, 2031     AAA/AAA           $25,000
Class 2-A-13          5.50%      $19,376,000.00       Senior/PAC/Fixed Rate      October 25, 2031     AAA/AAA           $25,000
Class 1-A-P          0.000%      $1,136,409.09        Senior/Principal Only      October 25, 2031     AAA/AAA           $25,000
                                                         Senior/Interest
Class 1-A-V       Variable Rate  $0.00                  Only/Variable Rate       October 25, 2031     AAA/AAA             20%
Class 2-A-P          0.000%      $11,377.14           Senior/Principal Only      October 25, 2031     AAA/AAA           $25,000
                                                         Senior/Interest
Class 2-A-V       Variable Rate  $0.00                  Only/Variable Rate       October 25, 2031     AAA/AAA             20%
                                                      Senior/Residual/Fixed
Class R-1             6.50%      $100.00                       Rate              October 25, 2031     AAA/AAA             20%
                                                      Senior/Residual/Fixed
Class R-2             6.50%      $100.00                       Rate              October 25, 2031     AAA/AAA             20%
                                                      Senior/Residual/Fixed
Class R-3             6.50%      $100.00                       Rate              October 25, 2031     AAA/AAA             20%

                                                        -6-

<PAGE>

                    Variable
Class M-1           Rate (4)     $8,141,000.00              Mezzanine            October 25, 2031      AA/NA            $25,000
                    Variable
Class M-2           Rate (4)     $3,256,000.00              Mezzanine            October 25, 2031       A/NA           $250,000
                    Variable
Class M-3           Rate (4)     $1,900,000.00              Mezzanine            October 25, 2031      BBB/NA          $250,000
                    Variable
Class B-1            Rate(4)     $1,085,000.00             Subordinate           October 25, 2031      BB/NA           $250,000
                    Variable
Class B-2           Rate (4)     $814,000.00               Subordinate           October 25, 2031       B/NA           $250,000
Class B-3           Variable
                    Rate (4)     $1,085,789.95             Subordinate           October 25, 2031      NA/NA           $250,000
</TABLE>

         The Mortgage Loans are comprised of two Loan Groups and have an
aggregate principal balance as of the Cut-off Date of $542,682,876.18.

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

--------
(4)      The Class, M-1, Class M-2, Class M-3, Class B-1, Class B-2 and Class
         B-3 Certificates will bear interest at a variable Pass-Through Rate
         equal to the weighted average of the Uncertificated Pass-Through Rates
         on each Uncertificated REMIC II Regular Interest ending with the
         designation "SUB;" provided that, for purposes of such weighted
         average, the Pass-Through Rate of REMIC II Regular Interest MT-1SUB
         will be subject to a cap and a floor equal to the Uncertificated
         Pass-Through Rate of REMIC II Regular Interest MT-1Pool and the
         Pass-Through Rate of REMIC II Regular Interest MT-2SUB will be subject
         to a cap and a floor equal to the Uncertificated Pass-Through Rate of
         REMIC II Regular Interest MT-2 Pool. The Pass-Through Rate for the
         Class M-1, Class M-2, Class M-3, Class B-1, Class B-2 and Class B-3
         Certificates with respect to the first interest accrual period is
         expected to be approximately 6.6905% per annum.

                                       -7-

<PAGE>

                                    ARTICLE I

                                   DEFINITIONS

         Section 1.01      DEFINITIONS.

         Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the meanings specified in this
Article.

         AGGREGATE PLANNED PRINCIPAL BALANCE: With respect to the PAC
Certificates and each Distribution Date, the amount set forth for such Classes
on such Distribution Date on Exhibit Six hereto.

         BANKRUPTCY AMOUNT: As of any date of determination prior to the first
anniversary of the Cut-off Date, an amount equal to the excess, if any, of (A)
$149,919 over (B) the aggregate amount of Bankruptcy Losses allocated solely to
one or more specific Classes of Certificates in accordance with Section 4.05 of
this Series Supplement. As of any date of determination on or after the first
anniversary of the Cut-off Date, an amount equal to the excess, if any, of

                  (1) the lesser of (a) the Bankruptcy Amount calculated as of
         the close of business on the Business Day immediately preceding the
         most recent anniversary of the Cut-off Date coinciding with or
         preceding such date of determination (or, if such date of determination
         is an anniversary of the Cut-off Date, the Business Day immediately
         preceding such date of determination) (for purposes of this definition,
         the "Relevant Anniversary") and (b) the greater of

                           (A) the greater of (i) 0.0006 times the aggregate
                  principal balance of all the Mortgage Loans in the Mortgage
                  Pool as of the Relevant Anniversary (other than Additional
                  Collateral Loans, if any) having a Loan-to-Value Ratio at
                  origination which exceeds 75% and (ii) $100,000; and

                           (B) the greater of (i) the product of (x) an amount
                  equal to the largest difference in the related Monthly Payment
                  for any Non-Primary Residence Loan remaining in the Mortgage
                  Pool (other than Additional Collateral Loans, if any) which
                  had an original Loan-to-Value Ratio of 80% or greater that
                  would result if the Net Mortgage Rate thereof was equal to the
                  weighted average (based on the principal balance of the
                  Mortgage Loans as of the Relevant Anniversary) of the Net
                  Mortgage Rates of all Mortgage Loans as of the Relevant
                  Anniversary less 1.25% per annum, (y) a number equal to the
                  weighted average remaining term to maturity, in months, of all
                  Non-Primary Residence Loans remaining in the Mortgage Pool as
                  of the Relevant Anniversary, and (z) one plus the quotient of
                  the number of all Non-Primary Residence Loans remaining in the
                  Mortgage Pool divided by the total number of

                                       -8-

<PAGE>

                  Outstanding Mortgage Loans in the Mortgage Pool as of the
                  Relevant Anniversary, and (ii) $50,000, over (2) the aggregate
                  amount of Bankruptcy Losses allocated solely to one or more
                  specific Classes of Certificates in accordance with Section
                  4.05 since the Relevant Anniversary.

         The Bankruptcy Amount may be further reduced by the Master Servicer
(including accelerating the manner in which such coverage is reduced) provided
that prior to any such reduction, the Master Servicer shall (i) obtain written
confirmation from each Rating Agency that such reduction shall not reduce the
rating assigned to any Class of Certificates by such Rating Agency below the
lower of the then-current rating or the rating assigned to such Certificates as
of the Closing Date by such Rating Agency and (ii) provide a copy of such
written confirmation to the Trustee.

         CERTIFICATE:  Any Class A, Class M, Class B or Class R Certificate.

         CERTIFICATE ACCOUNT: The separate account or accounts created and
maintained pursuant to Section 4.01 of the Standard Terms, which shall be
entitled "Bank One, National Association, as trustee, in trust for the
registered holders of Residential Funding Mortgage Securities I, Inc., Mortgage
Pass-Through Certificates, Series 2001-S23" and which must be an Eligible
Account.

         CLASS A CERTIFICATE: Any one of the Group 1 Certificates or the Group 2
Certificates (other than the Class R Certificates), executed by the Trustee and
authenticated by the Certificate Registrar substantially in the form annexed to
the Standard Terms as Exhibit A.

         CLASS A-V CERTIFICATE: Any one of the Class 1-A-V Certificates or Class
2-A-V Certificates

         CLASS A-P CERTIFICATE: Any one of the Class 1-A-P Certificates or Class
2-A-P Certificates

         CLASS R CERTIFICATE: Any one of the Class R-1 Certificates, Class R-2
Certificates or Class R-3 Certificates executed by the Trustee and authenticated
by the Certificate Registrar substantially in the form annexed to the Standard
Terms as Exhibit D and evidencing an interest designated as a "residual
interest" in the REMIC for purposes of the REMIC Provisions.

         CLOSING DATE: October 30, 2001.

         CORPORATE TRUST OFFICE: The principal office of the Trustee at which at
any particular time its corporate trust business with respect to this Agreement
shall be administered, which office at the date of the execution of this
Agreement is located at 1 Bank One Plaza, Suite IL1-0126, Chicago, Illinois
60670-0126, Attention: Residential Funding Corporation Series 2001-S23.

         CORRESPONDING CERTIFICATED INTERESTS: With respect to REMIC II Regular
Interest MT-1A1, the Class 1-A-1 Certificates; with respect to REMIC II Regular
Interest MT-1A3, the Class 1-A-3 Certificates; with respect to REMIC II Regular
Interest MT-1A5, the Class 1-A-5 Certificates; with

                                       -9-

<PAGE>

respect to REMIC II Regular Interest MT-1A6, the Class 1-A-6 Certificates; with
respect to REMIC II Regular Interest MT-1A9, the Class 1-A-9 Certificates; with
respect to REMIC II Regular Interest MT-1A10, the Class 1-A-10 Certificates;
with respect to REMIC II Regular Interest MT-1A11, the Class 1-A-11
Certificates; with respect to REMIC II Regular Interest MT-1A12, the Class
1-A-12 Certificates; with respect to REMIC II Regular Interest MT-1A13, the
Class 1-A-13 Certificates; with respect to REMIC II Regular Interest MT-1A14,
the Class 1-A-14 Certificates; with respect to REMIC II Regular Interest
MT-1A15, the Class 1-A-15 Certificates; with respect to REMIC II Regular
Interest MT-2A1, the Class 2-A-1 Certificates; with respect to REMIC II Regular
Interest MT-2A4, the Class 2-A-4 Certificates; with respect to REMIC II Regular
Interest MT-2A13, the Class 2-A-13 Certificates; with respect to REMIC II
Regular Interest Y, the Class 1-A-P Certificates; with respect to REMIC II
Regular Interest Z, the Class 2-A-P Certificates; with respect to each REMIC II
Group 1 IO Regular Interest, the related Uncertificated Class 1-A-V REMIC
Regular Interest; and with respect to each REMIC II Group 2 IO Regular Interest,
the related Uncertificated Class 2-A-V REMIC Regular Interest.

         CORRESPONDING UNCERTIFICATED INTERESTS: With respect to REMIC I Regular
Interest LT-1P, REMIC II Regular Interest Y; with respect to REMIC I Regular
Interest LT-2P, REMIC II Regular Interest Z; with respect to REMIC I Regular
Interest LT-2R, the Class R-2 Certificate; with respect to each REMIC I Group 1
IO Regular Interest, the related REMIC II Group 1 IO Regular Interest; with
respect to each REMIC I Group 2 IO Regular Interest, the related REMIC II Group
2 IO Regular Interest.

         CUT-OFF DATE: October 1, 2001.

         DETERMINATION DATE: With respect to any Distribution Date, the second
Business Day prior to each Distribution Date.

         DISCOUNT NET MORTGAGE RATE: With respect to Loan Group 1, 6.75% per
annum. With respect to Loan Group 2, 6.50% per annum.

         DUE PERIOD: With respect to each Distribution Date and any Mortgage
Loan, the period commencing on the second day of the month prior to the month in
which such Distribution Date occurs and ending on the first day of the month in
which such Distribution Date occurs.

         ELIGIBLE FUNDS: On any Distribution Date, the portion, if any, of the
Available Distribution Amount remaining after reduction by the sum of (i) the
aggregate amount of Accrued Certificate Interest on the related Senior
Certificates, (ii) the related Senior Principal Distribution Amount (determined
without regard to Section 4.02(a)(ii)(Y)(D) of this Series Supplement), (iii)
the related Class A-P Principal Distribution Amount (determined without regard
to Section 4.02(b)(i)(E) of this Series Supplement) and (iv) the aggregate
amount of Accrued Certificate Interest on the Class M, Class B-1 and Class B-2
Certificates.

         FLOATER CERTIFICATES: Any one of the Class 1-A-7 Certificates or Class
2-A-2 Certificates.

                                      -10-

<PAGE>

         FRAUD LOSS AMOUNT: As of any date of determination after the Cut-off
Date, an amount equal to: (X) prior to the third anniversary of the Cut-off
Date, an amount equal to 1.00% of the aggregate outstanding principal balance of
all of the Mortgage Loans as of the Cut-off Date minus the aggregate amount of
Fraud Losses allocated solely to one or more specific Classes of Certificates in
accordance with Section 4.05 of this Series Supplement since the Cut-off Date up
to such date of determination and (Y) from the third to the fifth anniversary of
the Cut-off Date, an amount equal to (1) the lesser of (a) the Fraud Loss Amount
as of the most recent anniversary of the Cut-off Date and (b) 0.50% of the
aggregate outstanding principal balance of all of the Mortgage Loans as of the
most recent anniversary of the Cut-off Date minus (2) the aggregate amount of
Fraud Losses allocated solely to one or more specific Classes of Certificates in
accordance with Section 4.05 of this Series Supplement since the most recent
anniversary of the Cut-off Date up to such date of determination. On and after
the fifth anniversary of the Cut-off Date, the Fraud Loss Amount shall be zero.

         The Fraud Loss Amount may be further reduced by the Master Servicer
(including accelerating the manner in which such coverage is reduced) provided
that prior to any such reduction, the Master Servicer shall (i) obtain written
confirmation from each Rating Agency that such reduction shall not reduce the
rating assigned to any Class of Certificates by such Rating Agency below the
lower of the then-current rating or the rating assigned to such Certificates as
of the Closing Date by such Rating Agency and (ii) provide a copy of such
written confirmation to the Trustee.

         GROUP 1 CERTIFICATE: Any one of the Class 1-A-1, Class 1-A-2, Class
1-A-3, Class 1-A-4, Class 1-A-5, Class 1-A-6, Class 1-A-7, Class 1-A-8, Class
1-A-9, Class 1-A-10, Class 1-A-11, Class 1-A-12, Class 1-A-13, Class 1-A-14,
Class 1-A-15, Class 1-A-16, Class 1-A-17, Class 1-A-18, Class 1-A-19, Class
1-A-20, Class 1-A-P and Class 1-A-V Certificates executed by the Trustee and
authenticated by the Certificate Registrar substantially in the form annexed to
the Standard Terms as Exhibit A, each such Certificate (other than the Class
1-A-V and Class R-1 Certificates) evidencing an interest designated as a
"regular interest" in REMIC II for purposes of the REMIC Provisions and
representing an undivided interest in Loan Group I.

         GROUP 1 LOANS:  The Mortgage Loans designated in Exhibit One.

         GROUP 1 SENIOR CERTIFICATES: The Class 1-A-1, Class 1-A-2, Class 1-A-3,
Class 1-A-4, Class 1-A-5, Class 1-A-6, Class 1-A-7, Class 1-A-8, Class 1-A-9,
Class 1-A-10, Class 1-A-11, Class 1-A- 12, Class 1-A-13, Class 1-A-14, Class
1-A-15, Class 1-A-16, Class 1-A-17, Class 1-A-18, Class 1- A-19 and Class 1-A-P
Certificates.

         GROUP 1 SENIOR PERCENTAGE: As of any Distribution Date, the lesser of
100% and a fraction, expressed as a percentage, the numerator of which is the
aggregate Certificate Principal Balance of the Group 1 Certificates (other than
the Class 1-A-P Certificates) immediately prior to such Distribution Date and
the denominator of which is the aggregate Stated Principal Balance of all of the
Mortgage Loans (or related REO Properties) (other than the related Discount
Fraction of each

                                      -11-

<PAGE>

Discount Mortgage Loan) in Loan Group 1 immediately prior to such Distribution
Date.

         GROUP 1 SENIOR PRINCIPAL DISTRIBUTION AMOUNT: As to any Distribution
Date, the lesser of (a) the balance of the Available Distribution Amount related
to Loan Group 1 remaining after the distribution therefrom of all amounts
required to be distributed therefrom pursuant to Section 4.02(a)(i)(X) and
Section 4.02(a)(ii)(X) of this Series Supplement, and (b) the sum of the amounts
required to be distributed therefrom to the Group 1 Certificateholders on such
Distribution Date pursuant to Section 4.02(a)(ii)(Y) and Section 4.02(a)(xvi).

         GROUP 2 CERTIFICATE: Any one of the Class 2-A-1, Class 2-A-2, Class
2-A-3, Class 2-A-4, Class 2-A-5, Class 2-A-6, Class 2-A-7, Class 2-A-8, Class
2-A-9, Class 2-A-10, Class 2-A-11, Class 2-A-12, Class 2-A-13, Class 2-A-P,
Class 2-A-V, Class R-1, Class R-2 and Class R-3 Certificates, executed by the
Trustee and authenticated by the Certificate Registrar substantially in the form
annexed to the Standard Terms as Exhibit A, each such Certificate (other than
the Class 2-A-V and Class R-2 Certificates) representing an interest designated
as a "regular interest" in REMIC II for purposes of the REMIC Provisions, and
representing an undivided interest in Loan Group 2.

         GROUP 2 LOANS:  The Mortgage Loans designated in Exhibit Two.

         GROUP 2 SENIOR CERTIFICATES: The Class 2-A-1, Class 2-A-2, Class 2-A-3,
Class 2-A-4, Class 2-A-5, Class 2-A-6, Class 2-A-7, Class 2-A-8, Class 2-A-9,
Class 2-A-10, Class 2-A-11, Class 2-A- 12, Class 2-A-13, Class 2-A-P, Class R-2
and Class R-3 Certificates.

         GROUP 2 SENIOR PERCENTAGE: As of any Distribution Date, the lesser of
100% and a fraction, expressed as a percentage, the numerator of which is the
aggregate Certificate Principal Balance of the Group 2 Certificates (other than
the Class 2-A-P Certificates) immediately prior to such Distribution Date and
the denominator of which is the aggregate Stated Principal Balance of all of the
Mortgage Loans (or related REO Properties) (other than the related Discount
Fraction of each Discount Mortgage Loan) in Loan Group 2 immediately prior to
such Distribution Date.

         GROUP 2 SENIOR PRINCIPAL DISTRIBUTION AMOUNT: As to any Distribution
Date, the lesser of (a) the balance of the Available Distribution Amount related
to Loan Group 2 remaining after the distribution therefrom of all amounts
required to be distributed therefrom pursuant to Section 4.02(a)(i)(Y) and
Section 4.02(a)(ii)(X) of this Series Supplement, and (b) the sum of the amounts
required to be distributed therefrom to the Group 2 Certificateholders on such
Distribution Date pursuant to Section 4.02(a)(ii)(Y) and Section 4.02(a)(xvi)
and (xvii).

         INDIRECT DEPOSITORY PARTICIPANT: An institution that is not a
Depository Participant but clears through or maintains a custodial relationship
with Participants and has access to the Depository's clearing system.

         INITIAL MONTHLY PAYMENT FUND: $172,107, representing scheduled
principal amortization and interest at the Net Mortgage Rate during the Due
Period ending in October 2001, for those Mortgage

                                      -12-

<PAGE>

Loans for which the Trustee will not be entitled to receive such payment in
accordance with the definition of "Trust Fund".

         INITIAL NOTIONAL AMOUNT: With respect to REMIC II Regular Interest
MT-IO, $100. With respect to the Class 1-A-16 Certificates, $2,890,148.15. For
federal income tax purposes, however, the Initial Notional Amount of the Class
1-A-16 Certificates will be $39,017,000.00. With respect to the Class 1-A-17
Certificates, $21,383,814.81. For federal income tax purposes, however, the
Initial Notional Amount of the Class 1-A-17 Certificates will be $120,121,000.
With respect to the Class 1-A-18 Certificates, $1,851,851.85. For federal income
tax purposes, however, the Initial Notional Amount of the Class 1-A-18
Certificates will be $25,000,000.00. With respect to the Class 1-A-19
Certificates, $699,666.67. For federal income tax purposes, however, the Initial
Notional Amount of the Class 1-A-19 Certificates will be $18,891,000.00. With
respect to the Class 2-A-5 Certificates, $2,884,615.38. For federal income tax
purposes, however, the Initial Notional Amount of the Class 2-A-5 Certificates
will be $25,000,000.00. With respect to the Class 2-A-11 Certificates,
$5,164,461.54. For federal income tax purposes, however, the Initial Notional
Amount of the Class 2-A-11 Certificates will be $33,569,000.00. With respect to
any Class A-V Certificates or Subclass thereof issued pursuant to Section
5.01(c), the aggregate Cut-off Date Principal Balance of the Mortgage Loans
corresponding to the Uncertificated Class A-V REMIC Regular Interests
represented by such Class or Subclass on such date.

         INITIAL SUBORDINATE CLASS PERCENTAGE: With respect to each Class of
Subordinate Certificates, an amount which is equal to the initial aggregate
Certificate Principal Balance of such Class of Subordinate Certificates divided
by the aggregate Stated Principal Balance of all the Mortgage Loans as of the
Cut-off Date as follows:

         Class M-1: 1.50%                            Class B-1: 0.20%
         Class M-2: 0.60%                            Class B-2: 0.15%
         Class M-3: 0.35%                            Class B-3: 0.20%

         INTEREST ACCRUAL PERIOD: With respect to any Certificates, other than
the Adjustable Rate Certificates, the calendar month preceding the month in
which the Distribution Date occurs. The Interest Accrual Period for the
Adjustable Rate Certificates is the one-month 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.

         INTEREST ONLY CERTIFICATES: Any one of Class 1-A-16 Certificates, Class
1-A-17 Certificates, Class 1-A-18 Certificates, Class 1-A-19 Certificates, Class
2-A-5 Certificates, Class 2-A-11 Certificates, or any one of the Class A-V
Certificates. The Interest Only Certificates will have no Certificate Principal
Balance.

         INVERSE FLOATER CERTIFICATES: Any one of Class 1-A-8 Certificates or
Class 2-A-3 Certificates.

         LOAN GROUP:  Loan Group 1 or Loan Group 2.

                                      -13-

<PAGE>

         LOAN GROUP 1: The group of Mortgage Loans comprised of the Group 1
Loans.

         LOAN GROUP 2: The group of Mortgage Loans comprised of the Group 2
Loans.

         LOCKOUT CERTIFICATES: Any one of the Class 1-A-4, Class 1-A-20 or
2-A-12 Certificates.

         LOCKOUT PERCENTAGE: For any Distribution Date occurring prior to the
Distribution Date in November 2006, 0%. For any Distribution Date occurring
after the first five years following the Closing Date, a percentage determined
as follows: (i) for any Distribution Date during the sixth year after the
Closing Date, 30%; (ii) for any Distribution Date during the seventh year after
the Closing Date, 40%; (iii) for any Distribution Date during the eighth year
after the Closing Date, 60%; (iv) for any Distribution Date during the ninth
year after the Closing Date, 80%; and (v) for any Distribution Date thereafter,
100%.

         MATURITY DATE: October 25, 2031, the Distribution Date immediately
following the latest scheduled maturity date of any Mortgage Loan.

         MORTGAGE LOAN SCHEDULE: The list or lists of the Mortgage Loans
attached hereto as Exhibit One (with respect to the Group 1 Loans) and Exhibit
Two (with respect to the Group 2 Loans) (as amended from time to time to reflect
the addition of Qualified Substitute Mortgage Loans), which list or lists shall
set forth the following information as to each Mortgage Loan in the related Loan
Group:
         (a)      the Mortgage Loan identifying number ("RFC LOAN #");
         (b)      the maturity of the Mortgage Note ("MATURITY DATE");
         (c)      the Mortgage Rate ("ORIG RATE");
         (d)      the Subservicer pass-through rate ("CURR NET");
         (e)      the Net Mortgage Rate ("NET MTG RT");
         (f)      the Pool Strip Rate ("STRIP");
         (g)      the initial scheduled monthly payment of principal, if any,
                  and interest ("ORIGINAL P & I");
         (h)      the Cut-off Date Principal Balance ("PRINCIPAL BAL");
         (i)      the Loan-to-Value Ratio at origination ("LTV");
         (j)      the rate at which the Subservicing Fee accrues ("SUBSERV FEE")
                  and at which the Servicing Fee accrues ("MSTR SERV FEE");
         (k)      a code "T," "BT" or "CT" under the column "LN FEATURE,"
                  indicating that the Mortgage Loan is secured by a second or
                  vacation residence;
         (l)      a code "N" under the column "OCCP CODE," indicating that the
                  Mortgage Loan is secured by a non-owner occupied residence;
                  and
         (m)      whether such Mortgage Loan constitutes a Group 1 Loan or Group
                  2 Loan.

Such schedule may consist of multiple reports that collectively set forth all of
the information required.

                                      -14-

<PAGE>

         NOTIONAL AMOUNT: As of any date of determination, the Notional Amount
of the Class 1-A- 16 Certificates is equal to 2/27 multiplied by the Certificate
Principal Balance of the Class 1-A-15 Certificates immediately prior to that
date. The initial Notional Amount of the Class 1-A-16 Certificates is
$2,890,148.15. For federal income tax purposes, however, the Notional Amount of
the Class 1-A-16 Certificates is the Uncertificated Principal Balance of REMIC
II Regular Interest MT-1A15. As of any date of determination, the Notional
Amount of the Class 1-A-17 Certificates is equal to the sum of (i) 46/135
multiplied by the Certificate Principal Balance of the Class 1-A-1 Certificates,
(ii) 3/27 multiplied by the Certificate Principal Balance of the Class 1-A-14
Certificates and (iii) 3/27 multiplied by the Certificate Principal Balance of
the Class 1-A-15 Certificates, in each case immediately prior to that date. The
initial Notional Amount of the Class 1-A-17 Certificates is $21,383,814.81. For
federal income tax purposes, however, the Notional Amount of the Class 1-A-17
Certificates is the aggregate of the Uncertificated Principal Balances of REMIC
II Regular Interests MT-1A1, MT-1A14 and MT-1A15. As of any date of
determination, the Notional Amount of the Class 1-A-18 Certificates is equal to
2/27 multiplied by the Certificate Principal Balance of the Class 1-A-3
Certificates immediately prior to that date. The initial Notional Amount of the
Class 1-A-18 Certificates is $1,851,851.85. For federal income tax purposes,
however, the Notional Amount of the Class 1-A-18 Certificates is the
Uncertificated Principal Balance of REMIC II Regular Interest MT-1A3. As of any
date of determination, the Notional Amount of the Class 1-A-19 Certificates is
equal to the sum of (i) 1/27 multiplied by the Certificate Principal Balance of
the Class 1-A-5 Certificates, (ii) 1/27 multiplied by the Certificate Principal
Balance of the Class 1-A-6 Certificates, (iii) 1/27 multiplied by the
Certificate Principal Balance of the Class 1-A-9 Certificates, (iv) 1/27
multiplied by the Certificate Principal Balance of the Class 1-A-10
Certificates, (v) 1/27 multiplied by the Certificate Principal Balance of the
Class 1-A-11 Certificates, (vi) 1/27 multiplied by the Certificate Principal
Balance of the Class 1-A-12 Certificates and (vii) 1/27 multiplied by the
Certificate Principal Balance of the Class 1-A-13 Certificates, in each case
immediately prior to that date. The initial Notional Amount of the Class 1-A-19
Certificates is $699,666.67. For federal income tax purposes, however, the
Notional Amount of the Class 1-A-19 Certificates is the aggregate of the
Uncertificated Principal Balances of REMIC II Regular Interests MT-1A5, MT-1A6,
MT-1A9, MT-1A10, MT-1A11, MT-1A12, and MT-1A13. As of any date of determination,
the Notional Amount of the Class 2-A-5 Certificates is equal to 3/26 multiplied
by the Certificate Principal Balance of the Class 2-A-4 Certificates immediately
prior to that date. The initial Notional Amount of the Class 2-A-5 Certificates
is $2,884,615.38. For federal income tax purposes, however, the Notional Amount
of the Class 2-A-5 Certificates is the Uncertificated Principal Balance of REMIC
II Regular Interest MT-2A4. As of any date of determination, the Notional Amount
of the Class 2-A-11 Certificates is equal to sum of (i) 2/13 multiplied by the
Certificate Principal Balance of the Class 2-A-1 Certificates and (ii) 2/13
multiplied by the Certificate Principal Balance of the Class 2-A-13
Certificates, in each case immediately prior to that date. The initial Notional
Amount of the Class 2-A-11 Certificates is $5,164,461.54. For federal income tax
purposes, however, the Notional Amount of the Class 1-A-19 Certificates is the
aggregate of the Uncertificated Principal Balances of REMIC II Regular Interests
MT-2A1 and MT-2A13. As of any date of determination, the Notional Amount of the
Variable Strip Certificates is equal to the aggregate Stated Principal Balance
of the Mortgage Loans corresponding to the applicable Uncertificated Class A-V
REMIC Regular Interests represented by such Class immediately prior to that
date. Reference to a Notional

                                      -15-

<PAGE>

Amount with respect to any Interest Only Certificate is solely for convenience
in specific calculations and does not represent the right to receive any
distributions allocable to principal.

         PASS-THROUGH RATE: With respect to the Class A Certificates (other than
the Floater, Inverse Floater, Class A-V and Principal Only Certificates), Class
M Certificates, Class B Certificates and Class R Certificates and any
Distribution Date, the per annum rates set forth in the Preliminary Statement
hereto. With respect to the Class 1-A-7 Certificates and the initial Interest
Accrual Period, 3.46625% per annum, and as to any Interest Accrual Period
thereafter, a per annum rate equal to LIBOR plus 0.80%, subject to a maximum
rate of 8.50% per annum and a minimum rate of 0.80% per annum. With respect to
the Class 1-A-8 Certificates and the initial Interest Accrual Period,
19.4158928571% per annum, and as to any Interest Accrual Period thereafter, a
per annum rate equal to 29.70% minus the product of LIBOR and 3.8571428571,
subject to a maximum rate of 29.70% per annum and a minimum rate of 0.00% per
annum. With respect to the Class 2-A-2 Certificates and the initial Interest
Accrual Period, 3.43% per annum, and as to any Interest Accrual Period
thereafter, a per annum rate equal to LIBOR plus 0.80%, subject to a maximum
rate of 8.50% per annum and a minimum rate of 0.80% per annum. With respect to
the Class 2-A-3 Certificates and the initial Interest Accrual Period, 16.4775%
per annum, and as to any Interest Accrual Period thereafter, a per annum rate
equal to 25.025% minus the product of LIBOR and 3.25, subject to a maximum rate
of 25.025% per annum and a minimum rate of 0.00% per annum. For federal income
tax purposes, the Pass-Through Rate of the Class 1-A-16 Certificates will be
0.50%, and when such Pass-Through Rate is multiplied by a Notional Amount equal
to the Uncertificated Principal Balance of Uncertificated REMIC II Regular
Interest MT-1A15, the resulting Accrued Certificate Interest will be the
economic equivalent of the Accrued Certificate Interest resulting under the
definition thereof. For federal income tax purposes, the Pass-Through Rate of
the Class 1-A-17 Certificates will be the sum of 2.3% applied to a Notional
Amount equal to the Uncertificated Principal Balance of REMIC II Regular
Interest MT-1A1, 0.75% applied to a Notional Amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest MT-1A14 and 0.75% applied to a
Notional Amount equal to the Uncertificated Principal Balance of REMIC II
Regular Interest MT- 1A15, and when such Pass-Through Rate is multiplied by such
Notional Amount, the resulting Accrued Certificate Interest will be the economic
equivalent of the Accrued Certificate Interest resulting under the definition
thereof. For federal income tax purposes, the Pass-Through Rate of the Class
1-A-18 Certificates will be 0.50%, and when such Pass-Through Rate is multiplied
by a Notional Amount equal to the Uncertificated Principal Balance of
Uncertificated REMIC II Regular Interest MT-1A3, the resulting Accrued
Certificate Interest will be the economic equivalent of the Accrued Certificate
Interest resulting under the definition thereof. For federal income tax
purposes, the Pass-Through Rate of the Class 1-A-19 Certificates will be 0.25%,
and when such Pass-Through Rate is multiplied by a Notional Amount equal to the
aggregate Uncertificated Principal Balance of Uncertificated REMIC II Regular
Interests MT-1A5, MT-1A6, MT-1A9, MT-1A10, MT-1A11, MT- 1A12, and MT-1A13, the
resulting Accrued Certificate Interest will be the economic equivalent of the
Accrued Certificate Interest resulting under the definition thereof. For federal
income tax purposes, the Pass-Through Rate of the Class 2-A-5 Certificates will
be 0.75%, and when such Pass- Through Rate is multiplied by a Notional Amount
equal to the Uncertificated Principal Balance of Uncertificated REMIC II Regular
Interest MT-2A4, the resulting Accrued Certificate Interest will

                                      -16-

<PAGE>

be the economic equivalent of the Accrued Certificate Interest resulting under
the definition thereof. For federal income tax purposes, the Pass-Through Rate
of the Class 2-A-11 Certificates will be 1.00%, and when such Pass-Through Rate
is multiplied by a Notional Amount equal to the Uncertificated Principal Balance
of Uncertificated REMIC II Regular Interest MT-2A1 and MT- 2A13, the resulting
Accrued Certificate Interest will be the economic equivalent of the Accrued
Certificate Interest resulting under the definition thereof. With respect to the
Class A-V Certificates (other than any Subclass thereof) and any Distribution
Date, a rate equal to the weighted average, expressed as a percentage, of the
Pool Strip Rates of all Mortgage Loans in the related Loan Group as of the Due
Date in the related Due Period, weighted on the basis of the respective Stated
Principal Balances of such Mortgage Loans as of the day immediately preceding
such Distribution Date (or, with respect to the initial Distribution Date, at
the close of business on the Cut-off Date). With respect to the Class 1-A-V
Certificates and the initial Distribution Date, the Pass-Through Rate is equal
to 0.2396% per annum. With respect to the Class 2-A-V Certificates and the
initial Distribution Date, the Pass-Through Rate is equal to 0.4630% per annum.
With respect to any Subclass of Class A-V Certificates and any Distribution
Date, a rate equal to the weighted average, expressed as a percentage, of the
Pool Strip Rates of all Mortgage Loans corresponding to the applicable
Uncertificated Class A-V REMIC Regular Interests represented by such Subclass as
of the Due Date in the related Due Period, weighted on the basis of the
respective Stated Principal Balances of such Mortgage Loans as of the day
immediately preceding such Distribution Date (or with respect to the initial
Distribution Date, at the close of business on the Cut-off Date). The Principal
Only Certificates have no Pass-Through Rate and are not entitled to Accrued
Certificate Interest.

         PREPAYMENT ASSUMPTION: A prepayment assumption of 300% of the
prepayment speed assumption, used for determining the accrual of original issue
discount and market discount and premium on the Certificates for federal income
tax purposes. The prepayment speed assumption assumes a constant rate of
prepayment of mortgage loans of 0.2% per annum of the then outstanding principal
balance of such mortgage loans in the first month of the life of the mortgage
loans, increasing by an additional 0.2% per annum in each succeeding month until
the thirtieth month, and a constant 6% per annum rate of prepayment thereafter
for the life of the mortgage loans.

         PREPAYMENT DISTRIBUTION PERCENTAGE: With respect to any Distribution
Date and each Class of Subordinate Certificates for each Loan Group, under the
applicable circumstances set forth below, the respective percentages set forth
below:

                  (i) For any Distribution Date prior to the Distribution Date
         in November 2006 (unless the Certificate Principal Balances of the
         related Senior Certificates (other than the Class A-P Certificates)
         have been reduced to zero), 0%.

                  (ii) For any Distribution Date for which clause (i) above does
         not apply, and on which any Class of Subordinate Certificates are
         outstanding:

                           (a) in the case of the Class of Subordinate
                  Certificates then outstanding with

                                      -17-

<PAGE>

                  the Highest Priority and each other Class of Subordinate
                  Certificates for which the related Prepayment Distribution
                  Trigger has been satisfied, a fraction, expressed as a
                  percentage, the numerator of which is the Certificate
                  Principal Balance of such Class immediately prior to such date
                  and the denominator of which is the sum of the Certificate
                  Principal Balances immediately prior to such date of (1) the
                  Class of Subordinate Certificates then outstanding with the
                  Highest Priority and (2) all other Classes of Subordinate
                  Certificates for which the respective Prepayment Distribution
                  Triggers have been satisfied; and

                           (b) in the case of each other Class of Subordinate
                  Certificates for which the Prepayment Distribution Triggers
                  have not been satisfied, 0%; and

                  (iii) Notwithstanding the foregoing, if the application of the
         foregoing percentages on any Distribution Date as provided in Section
         4.02 of this Series Supplement (determined without regard to the
         proviso to the definition of "Subordinate Principal Distribution
         Amount") would result in a distribution in respect of principal of any
         Class or Classes of Subordinate Certificates in an amount greater than
         the remaining Certificate Principal Balance thereof (any such class, a
         "Maturing Class"), then: (a) the Prepayment Distribution Percentage of
         each Maturing Class shall be reduced to a level that, when applied as
         described above, would exactly reduce the Certificate Principal Balance
         of such Class to zero; (b) the Prepayment Distribution Percentage of
         each other Class of Subordinate Certificates (any such Class, a
         "Non-Maturing Class") shall be recalculated in accordance with the
         provisions in paragraph (ii) above, as if the Certificate Principal
         Balance of each Maturing Class had been reduced to zero (such
         percentage as recalculated, the "Recalculated Percentage"); (c) the
         total amount of the reductions in the Prepayment Distribution
         Percentages of the Maturing Class or Classes pursuant to clause (a) of
         this sentence, expressed as an aggregate percentage, shall be allocated
         among the Non-Maturing Classes in proportion to their respective
         Recalculated Percentages (the portion of such aggregate reduction so
         allocated to any Non-Maturing Class, the "Adjustment Percentage"); and
         (d) for purposes of such Distribution Date, the Prepayment Distribution
         Percentage of each Non-Maturing Class shall be equal to the sum of (1)
         the Prepayment Distribution Percentage thereof, calculated in
         accordance with the provisions in paragraph (ii) above as if the
         Certificate Principal Balance of each Maturing Class had not been
         reduced to zero, plus (2) the related Adjustment Percentage.

         PRINCIPAL ONLY CERTIFICATES: Any one of the Class 1-A-P Certificates or
Class 2-A-P Certificates.

         REMIC I: The segregated pool of assets related to this Series, with
respect to which a REMIC election is to be made (except as provided below)
pursuant to this Agreement, consisting of:

         (i)      the Mortgage Loans and the related Mortgage Files and
                  collateral securing such Mortgage Loans,

                                      -18-

<PAGE>

         (ii)     all payments on and collections in respect of the Mortgage
                  Loans due after the Cut-off Date as shall be on deposit in the
                  Custodial Account or in the Certificate Account and identified
                  as belonging to the Trust Fund, including the proceeds from
                  the liquidation of Pledged Assets for any Pledged Asset Loan,
                  including amounts on deposit in the Initial Monthly Payment
                  Fund,

         (iii)    property that secured a Mortgage Loan and that has been
                  acquired for the benefit of the Certificateholders by
                  foreclosure or deed in lieu of foreclosure,

         (iv)     the hazard insurance policies and Primary Insurance Policies,
                  if any, the Pledged Assets with respect to each Pledged Asset
                  Loan, and

         (v)      all proceeds of clauses (i) through (iv) above.

         Notwithstanding the foregoing, the REMIC election specifically excludes
the Initial Monthly Payment Fund.

         REMIC I CERTIFICATES:  The Class R-1 Certificates.

         REMIC I WEIGHTED AVERAGE RATE: The weighted average of the
Uncertificated REMIC I Pass-Through Rates for REMIC I Regular Interest LT-1A,
REMIC I Regular Interest LT-2A and REMIC I Regular Interest LT-2R.

         REMIC II: The segregated pool of assets consisting of the
Uncertificated REMIC I Regular Interests conveyed in trust to the Trustee for
the benefit of the holders of the Uncertificated REMIC II Regular Interests and
the Class R-2 Certificates pursuant to Section 2.06, with respect to which a
separate REMIC election is to be made.

         REMIC III: The segregated pool of assets consisting of the
Uncertificated REMIC II Regular Interests conveyed in trust to the Trustee for
the benefit of the holders of the Class 1-A-1, Class 1- A-2, Class 1-A-3, Class
1-A-4, Class 1-A-5, Class 1-A-6, Class 1-A-7, Class 1-A-8, Class 1-A-9, Class
1-A-10, Class 1-A-11, Class 1-A-12, Class 1-A-13, Class 1-A-14, Class 1-A-15,
Class 1-A-16, Class 1-A-17, Class 1-A-18, Class 1-A-19, Class 1-A-20, Class
2-A-1, Class 2-A-2, Class 2-A-3, Class 2-A-4, Class 2-A-5, Class 2-A-6, Class
2-A-7, Class 2-A-8, Class 2-A-9, Class 2-A-10, Class 2-A-11, Class 2-A-12, Class
2-A-13, Class 1-A-P, Class 2-A-P, Class 1-A-V, Class 2-A-V, Class M-1, Class
M-2, Class M-3, Class B-1, Class B-2, Class B-3 and R-2 Certificates pursuant to
Section 2.06, with respect to which a separate REMIC election is to be made.

         REMIC III CERTIFICATES: Any of the Class 1-A-1, Class 1-A-2, Class
1-A-3, Class 1-A-4, Class 1-A-5, Class 1-A-6, Class 1-A-7, Class 1-A-8, Class
1-A-9, Class 1-A-10, Class 1-A-11, Class 1-A-12, Class 1-A-13, Class 1-A-14,
Class 1-A-15, Class 1-A-16, Class 1-A-17, Class 1-A-18, Class 1-A-19, Class
1-A-20, Class 2-A-1, Class 2-A-2, Class 2-A-3, Class 2-A-4, Class 2-A-5, Class
2- A-6, Class 2-A-7, Class 2-A-8, Class 2-A-9, Class 2-A-10, Class 2-A-11, Class
2-A-12, Class 2-A-

                                      -19-

<PAGE>

13, Class 1-A-P, Class 2-A-P, Class 1-A-V, Class 2-A-V, Class M-1, Class M-2,
Class M-3, Class B-1, Class B-2, Class B-3 and R-3 Certificates.

         SENIOR CERTIFICATE: Any one of the Class A Certificates or Class R
Certificates, executed by the Trustee and authenticated by the Certificate
Registrar substantially in the form annexed to the Standard Terms as Exhibit A
and Exhibit D, respectively.

         SENIOR PERCENTAGE: The Group 1 Senior Percentage, with respect to Loan
Group 1, or the Group 2 Senior Percentage, with respect to Loan Group 2.

         SENIOR PRINCIPAL DISTRIBUTION AMOUNT: The Group 1 Senior Principal
Distribution Amount or Group 2 Senior Principal Distribution Amount.

         SENIOR SUPPORT CERTIFICATES:  Any of the Class 1-A-20 Certificates.

         SPECIAL HAZARD AMOUNT: As of any Distribution Date, an amount equal to
$5,426,829 minus the sum of (i) the aggregate amount of Special Hazard Losses
allocated solely to one or more specific Classes of Certificates in accordance
with Section 4.05 of this Series Supplement and (ii) the Adjustment Amount (as
defined below) as most recently calculated. For each anniversary of the Cut- off
Date, the Adjustment Amount shall be equal to the amount, if any, by which the
amount calculated in accordance with the preceding sentence (without giving
effect to the deduction of the Adjustment Amount for such anniversary) exceeds
the greater of (A) the greatest of (i) twice the outstanding principal balance
of the Mortgage Loan in the Trust Fund which has the largest outstanding
principal balance on the Distribution Date immediately preceding such
anniversary, (ii) the product of 1.00% multiplied by the outstanding principal
balance of all Mortgage Loans on the Distribution Date immediately preceding
such anniversary and (iii) the aggregate outstanding principal balance (as of
the immediately preceding Distribution Date) of the Mortgage Loans in any single
five-digit California zip code area with the largest amount of Mortgage Loans by
aggregate principal balance as of such anniversary and (B) the greater of (i)
the product of 0.50% multiplied by the outstanding principal balance of all
Mortgage Loans on the Distribution Date immediately preceding such anniversary
multiplied by a fraction, the numerator of which is equal to the aggregate
outstanding principal balance (as of the immediately preceding Distribution
Date) of all of the Mortgage Loans secured by Mortgaged Properties located in
the State of California divided by the aggregate outstanding principal balance
(as of the immediately preceding Distribution Date) of all of the Mortgage
Loans, expressed as a percentage, and the denominator of which is equal to 47.9%
(which percentage is equal to the percentage of Mortgage Loans initially secured
by Mortgaged Properties located in the State of California) and (ii) the
aggregate outstanding principal balance (as of the immediately preceding
Distribution Date) of the largest Mortgage Loan secured by a Mortgaged Property
(or, with respect to a Cooperative Loan, the related Cooperative Apartment)
located in the State of California.

         The Special Hazard Amount may be further reduced by the Master Servicer
(including accelerating the manner in which coverage is reduced) provided that
prior to any such reduction, the

                                      -20-
<PAGE>

Master Servicer shall (i) obtain written confirmation from each Rating Agency
that such reduction shall not reduce the rating assigned to any Class of
Certificates by such Rating Agency below the lower of the then-current rating or
the rating assigned to such Certificates as of the Closing Date by such Rating
Agency and (ii) provide a copy of such written confirmation to the Trustee.

         SUBORDINATE BALANCE RATIO: The desired ratio between the Uncertificated
Principal Balances of REMIC II Regular Interests MT-1SUB AND MT-2SUB, equal to
the ratio of (1) the excess of (x) the Uncertificated Principal Balance of REMIC
I Regular Interest LT-1A over (y) the Certificate Principal Balance of the Group
1 Senior Certificates to (2) the excess of (x) the aggregate Uncertificated
Principal Balance of REMIC I Regular Interests LT-2A and LT-2R over (y) the
Certificate Principal Balance of the Group 2 Senior Certificates.

         SUBORDINATE PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
Distribution Date and Loan Group and each Class of Subordinate Certificates, (a)
the sum of (i) the product of (x) the Class's pro rata share, based on the
Certificate Principal Balance of each such Class then outstanding, and (y) the
aggregate of the amounts calculated for such Distribution Date under clauses
(1), (2) and (3) of Section 4.02(a)(ii)(Y)(A) of this Series Supplement (without
giving effect to the Senior Percentage) to the extent not payable to the Senior
Certificates; (ii) such Class's pro rata share, based on the Certificate
Principal Balance of each Class of Subordinate Certificates then outstanding, of
the principal collections described in Section 4.02(a)(ii)(Y)(B)(b) of this
Series Supplement (without giving effect to the Senior Accelerated Distribution
Percentage) to the extent such collections are not otherwise distributed to the
Senior Certificates; (iii) the product of (x) the related Prepayment
Distribution Percentage and (y) the aggregate of all Principal Prepayments in
Full received in the related Prepayment Period and Curtailments received in the
preceding calendar month (other than the related Discount Fraction of such
Principal Prepayments in Full and Curtailments with respect to a Discount
Mortgage Loan) to the extent not payable to the Senior Certificates; (iv) if
such Class is the Class of Subordinate Certificates with the Highest Priority,
any Excess Subordinate Principal Amount for such Distribution Date to the extent
of Eligible Funds for such Distribution Date; and (v) any amounts described in
clauses (i), (ii) and (iii) as determined for any previous Distribution Date,
that remain undistributed to the extent that such amounts are not attributable
to Realized Losses which have been allocated to a Class of Subordinate
Certificates minus (b) with respect to the Class of Subordinate Certificates
with the Lowest Priority, any Excess Subordinate Principal Amount for such
Distribution Date; PROVIDED, HOWEVER, that the Subordinate Principal
Distribution Amount for any Class of Subordinate Certificates on any
Distribution Date shall in no event exceed the outstanding Certificate Principal
Balance of such Class of Certificates immediately prior to such date.

         SUPER SENIOR CERTIFICATES: Any of the Class 1-A-4 Certificates.

         SUPER SENIOR OPTIMAL PRINCIPAL DISTRIBUTION AMOUNT: As to any
Distribution Date on or after the Credit Support Depletion Date and the Super
Senior Certificates relating to a Loan Group, the product of (a) the
then-applicable Super Senior Optimal Percentage and (b) the related Senior
Principal Distribution Amount.

                                      -21-
<PAGE>

         SUPER SENIOR OPTIMAL PERCENTAGE: As to any Distribution Date on or
after the Credit Support Depletion Date and the Super Senior Certificates
relating to a Loan Group, a fraction, expressed as a percentage, the numerator
of which is the Certificate Principal Balance of the applicable Super Senior
Certificates immediately prior to such Distribution Date and the denominator of
which is the aggregate Certificate Principal Balance of the related Senior
Certificates (other than the related Class A-P Certificates) immediately prior
to such Distribution Date.

         TRUST FUND: REMIC I, REMIC II, REMIC III and the Initial Monthly
Payment Fund.

         UNCERTIFICATED CLASS A-V REMIC REGULAR INTERESTS: The Uncertificated
Class 1-A-V REMIC Regular Interests or Uncertificated Class 2-A-V REMIC Regular
Interests

         UNCERTIFICATED CLASS 1-A-V REMIC ACCRUED INTEREST: With respect to each
Distribution Date, as to each Uncertificated Class 1-A-V REMIC Regular Interest,
an amount equal to the aggregate amount of Accrued Certificate Interest that
would result under the terms of the definition thereof on each such
uncertificated interest, if the Pass-Through Rate on such uncertificated
interest was equal to the related Uncertificated Class 1-A-V REMIC Pass-Through
Rate and the notional amount of such uncertificated interest was equal to the
related Uncertificated Class 1-A-V REMIC Notional Amount; provided, that any
reduction in the amount of Accrued Certificate Interest resulting from the
allocation of Prepayment Interest Shortfalls, Realized Losses or other amounts
to the Class 1-A-V Certificateholders pursuant to Section 4.05 hereof shall be
allocated to the Uncertificated Class 1-A-V REMIC Regular Interests pro rata in
accordance with the amount of interest accrued with respect to each related
Uncertificated Class 1-A-V REMIC Notional Amount and such Distribution Date. For
federal income tax purposes, however, with respect to each Distribution Date, as
to each Uncertificated Class 1-A-V REMIC Regular Interest, an amount equal to
100% of the interest paid on the related REMIC II Group 1 IO Regular Interest.

         UNCERTIFICATED CLASS 1-A-V REMIC NOTIONAL AMOUNT: With respect to each
Uncertificated Class 1-A-V REMIC Regular Interest, the amount of the related
Uncertificated REMIC II Group 1 IO Notional Amount.

         UNCERTIFICATED CLASS 1-A-V REMIC PASS-THROUGH RATE: With respect to
each Uncertificated Class 1-A-V REMIC Regular Interest, the related
Uncertificated REMIC II Pass-Through Rate.

         UNCERTIFICATED CLASS 1-A-V REMIC REGULAR INTERESTS: The 849
uncertificated partial undivided beneficial ownership interests in the Trust
Fund numbered sequentially from 1 through 849 each relating to the particular
Group 1 Loan identified by sequential number on the Mortgage Loan Schedule, each
having no principal balance, and each bearing the respective Pool Strip Rate on
the Stated Principal Balance of the related Mortgage Loan.

         UNCERTIFICATED CLASS 2-A-V REMIC ACCRUED INTEREST: With respect to each
Distribution Date, as to each Uncertificated Class 2-A-V REMIC Regular Interest,
an amount equal to the aggregate amount of Accrued Certificate Interest that
would result under the terms of the definition

                                      -22-
<PAGE>

thereof on each such uncertificated interest, if the Pass-Through Rate on such
uncertificated interest was equal to the related Uncertificated Class 2-A-V
REMIC Pass-Through Rate and the notional amount of such uncertificated interest
was equal to the related Uncertificated Class 2-A-V REMIC Notional Amount;
provided, that any reduction in the amount of Accrued Certificate Interest
resulting from the allocation of Prepayment Interest Shortfalls, Realized Losses
or other amounts to the Class 2-A-V Certificateholders pursuant to Section 4.05
hereof shall be allocated to the Uncertificated Class 2-A-V REMIC Regular
Interests pro rata in accordance with the amount of interest accrued with
respect to each related Uncertificated Class 2-A-V REMIC Notional Amount and
such Distribution Date. For federal income tax purposes, however, with respect
to each Distribution Date, as to each Uncertificated Class 2-A-V REMIC Regular
Interest, an amount equal to 100% of the interest paid on the related REMIC II
Group 2 IO Regular Interest.

         UNCERTIFICATED CLASS 2-A-V REMIC NOTIONAL AMOUNT: With respect to each
Uncertificated Class 2-A-V REMIC Regular Interest, the amount of the related
Uncertificated REMIC II Group 2 IO Notional Amount.

         UNCERTIFICATED CLASS 2-A-V REMIC PASS-THROUGH RATE: With respect to
each Uncertificated Class 2-A-V REMIC Regular Interest, the related
Uncertificated REMIC II Pass-Through Rate.

         UNCERTIFICATED CLASS 2-A-V REMIC REGULAR INTERESTS: The 319
uncertificated partial undivided beneficial ownership interests in the Trust
Fund numbered sequentially from 1 through 319 each relating to the particular
Group 2 Loan identified by sequential number on the Mortgage Loan Schedule, each
having no principal balance, and each bearing the respective Pool Strip Rate on
the Stated Principal Balance of the related Mortgage Loan.

         UNCERTIFICATED NOTIONAL AMOUNT: With respect to the REMIC I Group 1 IO
Regular Interests, the related Uncertificated REMIC I Group 1 IO Notional
Amount; with respect to the REMIC I Group 2 IO Regular Interests, the related
Uncertificated REMIC I Group 2 IO Notional Amount; with respect to the REMIC II
Group 1 IO Regular Interests, the related Uncertificated REMIC II Group 1 IO
Notional Amount; with respect to the REMIC II Group 2 IO Regular Interests, the
related Uncertificated REMIC II Group 2 IO Notional Amount; and with respect to
REMIC II Regular Interest MT-IO, the Uncertificated Principal Balance of REMIC I
Regular Interest LT-2R.

         UNCERTIFICATED PRINCIPAL BALANCE: With respect to each Uncertificated
REMIC I Regular Interest (other than the REMIC I Group 1 IO Regular Interests
and the REMIC I Group 2 IO Regular Interests) on any date of determination, an
amount equal to (A)(i) $412,464,927.00 with respect to REMIC I Regular Interest
LT-1A, (ii) $129,069,962.65 with respect to REMIC I Regular Interest LT-2A,
(iii) $100.00 with respect to REMIC I Regular Interest LT-2R, (iv) $1,136,409.09
with respect to REMIC I Regular Interest LT-1P and (v) $11,377.14 with respect
to REMIC I Regular Interest LT-2P, minus (B) the sum of (x) the aggregate of all
amounts previously deemed distributed with respect to such interest and applied
to reduce the Uncertificated Principal Balance thereof pursuant to Section
4.09(a)(ii) and (y) the aggregate of all reductions in Uncertificated Principal
Balance deemed to have occurred in connection with Realized Losses that were
previously deemed

                                      -23-
<PAGE>

allocated to the Uncertificated Principal Balance of such Uncertificated REMIC I
Regular Interest pursuant to Section 4.09(d). With respect to each
Uncertificated REMIC II Regular Interest (other than the REMIC II Group 1 IO
Regular Interests and the REMIC II Group 2 IO Regular Interests) on any date of
determination, an amount equal to (A)(i) $1,240.89 with respect to REMIC II
Regular Interest MT-1SUB, (ii) $41,246.49 with respect to REMIC II Regular
Interest MT-1Pool, (iii) $387.29 with respect to REMIC II Regular Interest
MT-2SUB, (iv) $12,907.01 with respect to REMIC II Regular Interest MT-2Pool, (v)
$319,898,108.27 with respect to REMIC II Regular Interest MT-X, (vi)
$35,000,000.00 with respect to REMIC II Regular Interest MT-1A1, (vii)
$25,000,000.00 with respect to REMIC II Regular Interest MT-1A3, (viii)
$8,000,000.00 with respect to REMIC II Regular Interest MT-1A5, (ix)
$2,000,000.00 with respect to REMIC II Regular Interest MT-1A6, (x)
$1,882,000.00 with respect to REMIC II Regular Interest MT-1A9, (xi)
$1,412,000.00 with respect to REMIC II Regular Interest MT-1A10, (xii)
$2,353,000.00 with respect to REMIC II Regular Interest MT-1A11, (xiii)
$1,412,000.00 with respect to REMIC II Regular Interest MT-1A12, (xiv)
$1,832,000.00 with respect to REMIC II Regular Interest MT- 1A13, (xv)
$46,104,000.00 with respect to REMIC II Regular Interest MT-1A14, (xvi)
$38,017,000.00 with respect to REMIC II Regular Interest MT-1A15, (xvii)
$14,193,00.00 with respect to REMIC II Regular Interest MT-2A1, (xviii)
$25,000,000.00 with respect to REMIC II Regular Interest MT-2A4, (xix)
$19,376,000.00 with respect to REMIC II Regular Interest MT- 2A13, (xx)
$1,136,409 with respect to REMIC II Regular Interest Y and (xxii) $11,377.00
with respect to REMIC II Regular Interest Z, minus (B) the sum of (x) the
aggregate of all amounts previously deemed distributed with respect to such
interest and applied to reduce the Uncertificated Principal Balance thereof
pursuant to Section 4.09(a)(ii) and (y) the aggregate of all reductions in
Uncertificated Principal Balance deemed to have occurred in connection with
Realized Losses that were previously deemed allocated to the Uncertificated
Principal Balance of such Uncertificated REMIC II Regular Interest pursuant to
Section 4.09(d).

         UNCERTIFICATED REMIC I ACCRUED INTEREST: With respect to each
Distribution Date, as to any REMIC I Regular Interest (other than REMIC I
Regular Interest LT-1P and REMIC I Regular Interest LT-2P), interest accrued
during the related Interest Accrual Period at the related Uncertificated
Pass-Through Rate on the Uncertificated Principal Balance or Uncertificated
Notional Amount thereof immediately prior to such Distribution Date.
Uncertificated REMIC I Accrued Interest will be calculated on the basis of a
360-day year, consisting of twelve 30-day months. In each case Uncertificated
REMIC I Accrued Interest on any REMIC I Regular Interest (other than REMIC I
Regular Interest LT-1P and REMIC I Regular Interest LT-2P) will be reduced by
the amount of: (i) Prepayment Interest Shortfalls on all Mortgage Loans (to the
extent not offset by the Master Servicer with a payment of Compensating Interest
as provided in Section 4.01), (ii) the interest portion (adjusted to the Net
Mortgage Rate (or the Modified Net Mortgage Rate in the case of a Modified
Mortgage Loan)) of Realized Losses on all Mortgage Loans (including Excess
Special Hazard Losses, Excess Fraud Losses, Excess Bankruptcy Losses and
Extraordinary Losses), (iii) the interest portion of Advances that were (A)
previously made with respect to a Mortgage Loan or REO Property on all Mortgage
Loans which remained unreimbursed following the Cash Liquidation or REO
Disposition of such Mortgage Loan or REO Property or (B) made with respect to
delinquencies that were ultimately determined to be Excess Special Hazard
Losses, Excess Fraud Losses, Excess

                                      -24-
<PAGE>

Bankruptcy Losses or Extraordinary Losses, and (iv) any other interest
shortfalls, including interest that is not collectible from the Mortgagor
pursuant to the Soldiers' and Sailors' Civil Relief Act of 1940, as amended, or
similar legislation or regulations as in effect from time to time, with all such
reductions allocated among all of the REMIC I Regular Interests (other than
REMIC I Regular Interest LT-1P and REMIC I Regular Interest LT-2P) in proportion
to their respective amounts of Uncertificated REMIC I Accrued Interest payable
on such Distribution Date absent such reductions.

         UNCERTIFICATED REMIC II ACCRUED INTEREST: With respect to each
Distribution Date, as to any Uncertificated REMIC II Regular Interest (other
than REMIC II Regular Interest Y and REMIC I Regular Interest Z), interest
accrued during the related Interest Accrual Period at the related Uncertificated
Pass-Through Rate on the Uncertificated Principal Balance or Uncertificated
Notional Amount thereof immediately prior to such Distribution Date.
Uncertificated REMIC II Accrued Interest will be calculated on the basis of a
360-day year, consisting of twelve 30-day months. In each case Uncertificated
REMIC II Accrued Interest on any Uncertificated REMIC II Regular Interest (other
than REMIC II Regular Interest Y and REMIC II Regular Interest Z) will be
reduced by the amount of: (i) Prepayment Interest Shortfalls on all Mortgage
Loans (to the extent not offset by the Master Servicer with a payment of
Compensating Interest as provided in Section 4.01), (ii) the interest portion
(adjusted to the Net Mortgage Rate (or the Modified Net Mortgage Rate in the
case of a Modified Mortgage Loan)) of Realized Losses on all Mortgage Loans
(including Excess Special Hazard Losses, Excess Fraud Losses, Excess Bankruptcy
Losses and Extraordinary Losses), (iii) the interest portion of Advances that
were (A) previously made with respect to a Mortgage Loan or REO Property on all
Mortgage Loans which remained unreimbursed following the Cash Liquidation or REO
Disposition of such Mortgage Loan or REO Property or (B) made with respect to
delinquencies that were ultimately determined to be Excess Special Hazard
Losses, Excess Fraud Losses, Excess Bankruptcy Losses or Extraordinary Losses,
and (iv) any other interest shortfalls, including interest that is not
collectible from the Mortgagor pursuant to the Soldiers' and Sailors' Civil
Relief Act of 1940, as amended, or similar legislation or regulations as in
effect from time to time, with all such reductions allocated among all of the
Uncertificated REMIC II Regular Interests (other than REMIC II Regular Interest
Y and REMIC II Regular Interest Z) in proportion to their respective amounts of
Uncertificated REMIC I Accrued Interest payable on such Distribution Date absent
such reductions.

         UNCERTIFICATED REMIC I GROUP 1 IO NOTIONAL AMOUNT: With respect to each
Uncertificated REMIC I Group 1 IO Regular Interest, the Stated Principal Balance
of the related Non-Discount Mortgage Loan.

         UNCERTIFICATED REMIC I GROUP 1 IO REGULAR INTERESTS: The 849
uncertificated partial undivided beneficial ownership interests in REMIC I, each
relating to a Group 1 Mortgage Loan with a Net Mortgage Rate in excess of 6.75%,
each having no principal balance, and each bearing interest at the respective
Uncertificated REMIC I Pass-Through Rate on the Uncertificated REMIC I IO
Notional Amount.

                                      -25-
<PAGE>

         UNCERTIFICATED REMIC I GROUP 1 IO REGULAR INTEREST DISTRIBUTION
AMOUNTS: With respect to any Distribution Date, the sum of the amounts deemed to
be distributed on the Uncertificated REMIC I Group 1 IO Regular Interests for
such Distribution Date pursuant to Section 4.09(a).

         UNCERTIFICATED REMIC I GROUP 2 IO NOTIONAL AMOUNT: With respect to each
Uncertificated REMIC I Group 2 IO Regular Interest, the Stated Principal Balance
of the related Non-Discount Mortgage Loan.

         UNCERTIFICATED REMIC I GROUP 2 IO REGULAR INTERESTS: The 319
uncertificated partial undivided beneficial ownership interests in REMIC I, each
relating to a Group 2 Mortgage Loan with a Net Mortgage Rate in excess of 6.50%,
each having no principal balance, and each bearing interest at the respective
Uncertificated REMIC I Pass-Through Rate on the Uncertificated REMIC I Group 2
IO Notional Amount.

         UNCERTIFICATED REMIC I GROUP 2 IO REGULAR INTEREST DISTRIBUTION
AMOUNTS: With respect to any Distribution Date, the sum of the amounts deemed to
be distributed on the Uncertificated REMIC I Group 2 IO Regular Interests for
such Distribution Date pursuant to Section 4.09(a).

         UNCERTIFICATED REMIC II GROUP 1 IO NOTIONAL AMOUNT: With respect to
each Uncertificated REMIC II Group 1 IO Regular Interest, the Uncertificated
Notional Amount of the related Uncertificated REMIC I Group 1 IO Regular
Interest.

         UNCERTIFICATED REMIC II GROUP 1 IO REGULAR INTERESTS: The 849
uncertificated partial undivided beneficial ownership interests in REMIC II,
each relating to an Uncertificated REMIC I Group 1 IO Regular Interest, having
no principal balance, and each entitled to 100% of the interest on the related
Uncertificated REMIC I Group 1 IO Regular Interest.

         UNCERTIFICATED REMIC II GROUP 1 IO REGULAR INTEREST DISTRIBUTION
AMOUNTS: With respect to any Distribution Date, the sum of the amounts deemed to
be distributed on the Uncertificated REMIC II Group 1 IO Regular Interests for
such Distribution Date pursuant to Section 4.10(a).

         UNCERTIFICATED REMIC II GROUP 2 IO NOTIONAL AMOUNT: With respect to
each Uncertificated REMIC II Group 2 IO Regular Interest, the Uncertificated
Notional Amount of the related Uncertificated REMIC I Group 2 IO Regular
Interest.

         UNCERTIFICATED REMIC II GROUP 2 IO REGULAR INTERESTS: The 319
uncertificated partial undivided beneficial ownership interests in REMIC II,
each relating to an Uncertificated REMIC I Group 2 IO Regular Interest, each
having no principal balance, and each entitled to 100% of the interest on the
related Uncertificated REMIC I Group 2 IO Regular Interest.

         UNCERTIFICATED REMIC II GROUP 2 IO REGULAR INTEREST DISTRIBUTION
AMOUNTS: With respect to any Distribution Date, the sum of the amounts deemed to
be distributed on the Uncertificated REMIC II Group 2 IO Regular Interests for
such Distribution Date pursuant to Section 4.10(a).

                                      -26-
<PAGE>

         UNCERTIFICATED REMIC I PASS-THROUGH RATE: With respect to each of the
Uncertificated REMIC I Regular Interests LT-1A, LT-2A, LT-2R, LT-1P and LT-2P,
6.75%, 6.50%, 6.50%, 0.00% and 0.00%, respectively. With respect to each REMIC I
Group 1 IO Regular Interest and each REMIC I Group 2 IO Regular Interest, a rate
equal to the Pool Strip Rate for the related Mortgage Loan.

         UNCERTIFICATED REMIC I REGULAR INTERESTS: The uncertificated partial
undivided beneficial ownership interests in REMIC I, designated as REMIC I
Regular Interest LT-1A, REMIC I Regular Interest LT-2A, REMIC I Regular Interest
LT-2R, REMIC I Regular Interest LT-1P, REMIC I Regular Interest LT-2P, the
Uncertificated REMIC I Group 1 IO Regular Interests and the Uncertificated REMIC
I Group 2 IO Regular Interests, each having an Uncertificated Principal Balance
(or Uncertificated Notional Amount) as specified herein and bearing interest at
a rate equal to the related Uncertificated REMIC I Pass-Through Rate.

         UNCERTIFICATED REMIC I REGULAR INTEREST DISTRIBUTION AMOUNT: With
respect to any Distribution Date, and any Uncertificated REMIC I Regular
Interest, the sum of the amounts deemed to be distributed on such Uncertificated
REMIC I Regular Interest for such Distribution Date pursuant to Section 4.09(a).

         UNCERTIFICATED REMIC II PASS-THROUGH RATE: With respect to each of the
Uncertificated REMIC II Regular Interests MT-1Pool, MT-2Pool, Y, Z and MT-IO,
6.75%, 6.50%, 0.00%, 0.00% and the excess, if any, of the REMIC I Weighted
Average Rate over 6.50%, respectively. With respect to each of the
Uncertificated REMIC II Regular Interests MT-1SUB, MT-2SUB, MT-X, MT- 1A1,
MT-1A3, MT-1A5, MT-1A6, MT-1A9, MT-1A10, MT-1A11, MT-1A12, MT-1A13, MT- 1A14,
MT-1A15, MT-2A1, MT-2A4, MT-2A13, the REMIC I Weighted Average Rate. With
respect to each Uncertificated REMIC II Group 1 IO Regular Interest, an amount
equal to 100% of the interest on the related Uncertificated REMIC I Group 1 IO
Regular Interest. With respect to each Uncertificated REMIC II Group 2 IO
Regular Interest, an amount equal to 100% of the interest on the related
Uncertificated REMIC I Group 2 IO Regular Interest.

         UNCERTIFICATED REMIC II REGULAR INTERESTS: The uncertificated partial
undivided beneficial ownership interests in REMIC II, designated as REMIC II
Regular Interest MT-1SUB, REMIC II Regular Interest MT-1SUB, REMIC II Regular
Interest MT-1SUB, REMIC II Regular Interest MT- 1Pool, REMIC II Regular Interest
MT-2SUB, REMIC II Regular Interest MT-2Pool, REMIC II Regular Interest MT-X,
REMIC II Regular Interest MT-1A1, REMIC II Regular Interest MT-1A3, REMIC II
Regular Interest MT-1A5, REMIC II Regular Interest MT-1A6, REMIC II Regular
Interest MT-1A9, REMIC II Regular Interest MT-1A10, REMIC II Regular Interest
MT-1A11, REMIC II Regular Interest MT-1A12, REMIC II Regular Interest MT-1A13,
REMIC II Regular Interest MT- 1A14, REMIC II Regular Interest MT-1A15, REMIC II
Regular Interest MT-2A1, REMIC II Regular Interest MT-2A4, REMIC II Regular
Interest MT-2A13, REMIC II Regular Interest Y, REMIC II Regular Interest Z,
REMIC II Group 1 IO Regular Interests, REMIC II Group 2 IO Regular Interests and
REMIC II Regular Interest MT-IO, each having an Uncertificated Principal Balance
(or

                                      -27-
<PAGE>

Uncertificated Notional Amount) as specified herein and bearing interest at a
rate equal to the related Uncertificated REMIC II Pass-Through Rate.

         UNCERTIFICATED REMIC II REGULAR INTEREST DISTRIBUTION AMOUNT: With
respect to any Distribution Date, and any Uncertificated REMIC II Regular
Interest, the sum of the amounts deemed to be distributed on such Uncertificated
REMIC II Regular Interest for such Distribution Date pursuant to Section
4.10(a).

         UNDERWRITER:  Banc of America Securities LLC.

         Section 1.02      USE OF WORDS AND PHRASES.

         "Herein," "hereby," "hereunder," "hereof," "hereinbefore,"
"hereinafter" and other equivalent words refer to the Pooling and Servicing
Agreement as a whole. All references herein to Articles, Sections or Subsections
shall mean the corresponding Articles, Sections and Subsections in the Pooling
and Servicing Agreement. The definitions set forth herein include both the
singular and the plural.

         Section 1.03      DETERMINATION OF LIBOR.

         LIBOR applicable to the calculation of the Pass-Through Rates on the
Floater Certificates and Inverse Floater Certificates, if any, for any Interest
Accrual Period (other than the initial Interest Accrual Period) will be
determined on each LIBOR Rate Adjustment Date.

         On each LIBOR Rate Adjustment Date (other than for the initial Interest
Accrual Period), LIBOR shall be established by the Trustee and, as to any
Interest Accrual Period, will equal the rate for one month United States dollar
deposits that appears on the Telerate Screen Page 3750 as of 11:00 a.m., London
time, on such LIBOR Rate Adjustment Date. "Telerate Screen Page 3750" means the
display designated as page 3750 on the Telerate Service (or such other page as
may replace page 3750 on that service for the purpose of displaying London
interbank offered rates of major banks). If such rate does not appear on such
page (or such other page as may replace that page on that service, or if such
service is no longer offered, LIBOR shall be so established by use of such other
service for displaying LIBOR or comparable rates as may be selected by the
Trustee after consultation with the Master Servicer), the rate will be the
Reference Bank Rate. The "Reference Bank Rate" will be determined on the basis
of the rates at which deposits in U.S. Dollars are offered by the reference
banks (which shall be any three major banks that are engaged in transactions in
the London interbank market, selected by the Trustee after consultation with the
Master Servicer) as of 11:00 a.m., London time, on the LIBOR Rate Adjustment
Date to prime banks in the London interbank market for a period of one month in
amounts approximately equal to the aggregate Certificate Principal Balance of
the Floater Certificates and Inverse Floater Certificates then outstanding. The
Trustee will request the principal London office of each of the reference banks
to provide a quotation of its rate. If at least two such quotations are
provided, the rate will be the arithmetic mean of the quotations rounded up to
the next multiple of 1/16%. If on such date fewer

                                      -28-
<PAGE>

than two quotations are provided as requested, the rate will be the arithmetic
mean of the rates quoted by one or more major banks in New York City, selected
by the Trustee after consultation with the Master Servicer, as of 11:00 a.m.,
New York City time, on such date for loans in U.S. Dollars to leading European
banks for a period of one month in amounts approximately equal to the
Certificate Principal Balances of the Floater Certificates and Inverse Floater
Certificates, respectively, then outstanding. If no such quotations can be
obtained, the rate will be LIBOR for the prior Distribution Date, or in the case
of the first LIBOR rate adjustment date, 2.66625% with respect to the Class
1-A-7 Certificates and Class 1-A-8 Certificates, and 2.63% with respect to the
Class 2-A-2 Certificates and Class 2-A-3 Certificates; provided however, if,
under the priorities listed previously in this paragraph, LIBOR for a
Distribution Date would be based on LIBOR for the previous Distribution Date for
the third consecutive Distribution Date, the Trustee shall select an alternative
comparable index over which the Trustee has no control, used for determining
one-month Eurodollar lending rates that is calculated and published or otherwise
made available by an independent party. LIBOR business day means any day other
than (i) a Saturday or a Sunday or (ii) a day on which banking institutions in
the city of London, England are required or authorized by law to be closed.

         The establishment of LIBOR by the Trustee on any LIBOR Rate Adjustment
Date and the Trustee's subsequent calculation of the Pass-Through Rates
applicable to each of the Floater Certificates and Inverse Floater Certificates
for the relevant Interest Accrual Period, in the absence of manifest error, will
be final and binding.

         Promptly following each LIBOR Rate Adjustment Date the Trustee shall
supply the Master Servicer with the results of its determination of LIBOR on
such date. Furthermore, the Trustee will supply to any Certificateholder so
requesting by telephone the Pass-Through Rates on each of the Floater
Certificates and Inverse Floater Certificates for the current and the
immediately preceding Interest Accrual Period.

                                      -29-
<PAGE>

                                   ARTICLE II

                          CONVEYANCE OF MORTGAGE LOANS;
                        ORIGINAL ISSUANCE OF CERTIFICATES

         Section 2.01      CONVEYANCE OF MORTGAGE LOANS. (SEE SECTION 2.01 OF
                           THE STANDARD TERMS)

         Section 2.02      ACCEPTANCE BY TRUSTEE. (SEE SECTION 2.02 OF THE
                           STANDARD TERMS)

         Section 2.03      REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE
                           MASTER SERVICER AND THE COMPANY.

                  (a) For representations, warranties and covenants of the
         Master Servicer, see Section 2.03(a) of the Standard Terms.

                  (b) The Company hereby represents and warrants to the Trustee
         for the benefit of Certificateholders that as of the Closing Date (or,
         if otherwise specified below, as of the date so specified):

                           (i) No Mortgage Loan is 30 or more days Delinquent in
                  payment of principal and interest as of the Cut-off Date and
                  no Mortgage Loan has been so Delinquent more than once in the
                  12-month period prior to the Cut-off Date;

                           (ii) The information set forth in Exhibits One and
                  Two hereto with respect to each Mortgage Loan or the Mortgage
                  Loans, as the case may be, in Loan Group I and Loan Group 2,
                  respectively, is true and correct in all material respects at
                  the date or dates respecting which such information is
                  furnished;

                           (iii) The Mortgage Loans are fully-amortizing,
                  fixed-rate mortgage loans with level Monthly Payments due on
                  the first day of each month and terms to maturity at
                  origination or modification of not more than 30 years;

                           (iv) To the best of the Company's knowledge, if a
                  Mortgage Loan is secured by a Mortgaged Property with a
                  Loan-to-Value Ratio at origination in excess of 80%, such
                  Mortgage Loan is the subject of a Primary Insurance Policy
                  that insures that (a) at least 30% of the Stated Principal
                  Balance of the Mortgage Loan at origination if the
                  Loan-to-Value Ratio is between 95.00% and 90.01%, (b) at least
                  25% of such balance if the Loan-to-Value Ratio is between
                  90.00% and 85.01%, and (c) at least 12% of such balance if the
                  Loan-to-Value Ratio is between 85.00% and 80.01%. To the best
                  of the Company's knowledge, each such Primary Insurance Policy
                  is in full force and effect and the Trustee is entitled to the
                  benefits thereunder;

                                      -30-
<PAGE>

                           (v) The issuers of the Primary Insurance Policies are
                  insurance companies whose claims-paying abilities are
                  currently acceptable to each Rating Agency;

                           (vi) No more than 0.8% of the Group 1 Loans and no
                  more than 1.3% of the Group 2 Loans, by aggregate Stated
                  Principal Balance as of the Cut-off Date are secured by
                  Mortgaged Properties located in any one zip code area in
                  California and no more than 0.8% of the Group 1 Loans and no
                  more than 0.8% of the Group 2 Loans, by aggregate Stated
                  Principal Balance as of the Cut-off Date are secured by
                  Mortgaged Properties located in any one zip code area outside
                  California;

                           (vii) The improvements upon the Mortgaged Properties
                  are insured against loss by fire and other hazards as required
                  by the Program Guide, including flood insurance if required
                  under the National Flood Insurance Act of 1968, as amended.
                  The Mortgage requires the Mortgagor to maintain such casualty
                  insurance at the Mortgagor's expense, and on the Mortgagor's
                  failure to do so, authorizes the holder of the Mortgage to
                  obtain and maintain such insurance at the Mortgagor's expense
                  and to seek reimbursement therefor from the Mortgagor;

                           (viii) Immediately prior to the assignment of the
                  Mortgage Loans to the Trustee, the Company had good title to,
                  and was the sole owner of, each Mortgage Loan free and clear
                  of any pledge, lien, encumbrance or security interest (other
                  than rights to servicing and related compensation) and such
                  assignment validly transfers ownership of the Mortgage Loans
                  to the Trustee free and clear of any pledge, lien, encumbrance
                  or security interest;

                           (ix) No more than 9.66% of the Group 1 Loans and no
                  more than 9.41% of the Group 2 Loans by aggregate Stated
                  Principal Balance as of the Cut-off Date were underwritten
                  under a reduced loan documentation program;

                           (x) Each Mortgagor represented in its loan
                  application with respect to the related Mortgage Loan that the
                  Mortgaged Property would be owner-occupied and therefore would
                  not be an investor property as of the date of origination of
                  such Mortgage Loan. No Mortgagor is a corporation or a
                  partnership;

                           (xi) None of the Group 1 Loans or Group 2 Loans as of
                  the Cut-off Date were Buydown Mortgage Loans;

                           (xii) Each Mortgage Loan constitutes a qualified
                  mortgage under Section 860G(a)(3)(A) of the Code and Treasury
                  Regulations Section 1.860G-2(a)(1);

                           (xiii) A policy of title insurance was effective as
                  of the closing of each Mortgage Loan and is valid and binding
                  and remains in full force and effect, unless the Mortgaged
                  Properties are located in the State of Iowa and an attorney's
                  certificate

                                      -31-
<PAGE>

                  has been provided as described in the Program Guide;

                           (xiv) None of the Mortgage Loans are Cooperative
                  Loans;

                           (xv) With respect to each Mortgage Loan originated
                  under a "streamlined" Mortgage Loan program (through which no
                  new or updated appraisals of Mortgaged Properties are obtained
                  in connection with the refinancing thereof), the related
                  Seller has represented that either (a) the value of the
                  related Mortgaged Property as of the date the Mortgage Loan
                  was originated was not less than the appraised value of such
                  property at the time of origination of the refinanced Mortgage
                  Loan or (b) the Loan- to-Value Ratio of the Mortgage Loan as
                  of the date of origination of the Mortgage Loan generally
                  meets the Company's underwriting guidelines;

                           (xvi) Interest on each Mortgage Loan is calculated on
                  the basis of a 360-day year consisting of twelve 30-day
                  months;

                           (xvii) None of the Mortgage Loans contains in the
                  related Mortgage File a Destroyed Mortgage Note; and

                           (xviii) Two of the Mortgage Loans are Pledged Asset
                  Loans.

It is understood and agreed that the representations and warranties set forth in
this Section 2.03(b) shall survive delivery of the respective Mortgage Files to
the Trustee or any Custodian.

         Upon discovery by any of the Company, the Master Servicer, the Trustee
or any Custodian of a breach of any of the representations and warranties set
forth in this Section 2.03(b) that materially and adversely affects the
interests of the Certificateholders in any Mortgage Loan, the party discovering
such breach shall give prompt written notice to the other parties (any Custodian
being so obligated under a Custodial Agreement); PROVIDED, HOWEVER, that in the
event of a breach of the representation and warranty set forth in Section
2.03(b)(xii), the party discovering such breach shall give such notice within
five days of discovery. Within 90 days of its discovery or its receipt of notice
of breach, the Company shall either (i) cure such breach in all material
respects or (ii) purchase such Mortgage Loan from the Trust Fund at the Purchase
Price and in the manner set forth in Section 2.02; provided that the Company
shall have the option to substitute a Qualified Substitute Mortgage Loan or
Loans for such Mortgage Loan if such substitution occurs within two years
following the Closing Date; provided that if the omission or defect would cause
the Mortgage Loan to be other than a "qualified mortgage" as defined in Section
860G(a)(3) of the Code, any such cure or repurchase must occur within 90 days
from the date such breach was discovered. Any such substitution shall be
effected by the Company under the same terms and conditions as provided in
Section 2.04 for substitutions by Residential Funding. It is understood and
agreed that the obligation of the Company to cure such breach or to so purchase
or substitute for any Mortgage Loan as to which such a breach has occurred and
is continuing shall constitute the sole remedy respecting such breach available
to the Certificateholders or the Trustee on behalf of the Certificateholders.

                                      -32-
<PAGE>

Notwithstanding the foregoing, the Company shall not be required to cure
breaches or purchase or substitute for Mortgage Loans as provided in this
Section 2.03(b) if the substance of the breach of a representation set forth
above also constitutes fraud in the origination of the Mortgage Loan.

         Section 2.04      REPRESENTATIONS AND WARRANTIES OF SELLERS. (SEE
                           SECTION 2.04 OF THE STANDARD TERMS)

         Section 2.05      EXECUTION AND AUTHENTICATION OF CERTIFICATES.

         The Trustee acknowledges the assignment to it of the Mortgage Loans and
the delivery of the Mortgage Files to it, or any Custodian on its behalf,
subject to any exceptions noted, together with the assignment to it of all other
assets included in the Trust Fund, receipt of which is hereby acknowledged.
Concurrently with such delivery and in exchange therefor, the Trustee, pursuant
to the written request of the Company executed by an officer of the Company has
executed and caused to be authenticated and delivered to or upon the order of
the Company the Certificates in authorized denominations which evidence
ownership of the entire Trust Fund.

         Section 2.06      CONVEYANCE OF UNCERTIFICATED REMIC I AND REMIC II
                           REGULAR INTERESTS; ACCEPTANCE BY THE TRUSTEE.

                  (a) The Company, as of the Closing Date, and concurrently with
         the execution and delivery hereof, does hereby assign without recourse
         all the right, title and interest of the Company in and to the
         Uncertificated REMIC I Regular Interests to the Trustee for the benefit
         of the Holders of the Uncertificated REMIC II Regular Interests and the
         Class R-2 Certificates. The Trustee acknowledges receipt of the
         Uncertificated REMIC I Regular Interests and declares that it holds and
         will hold the same in trust for the exclusive use and benefit of all
         present and future Holders of each of the Uncertificated REMIC II
         Regular Interests and the Class R-2 Certificates. The rights of
         theHolders of the Uncertificated REMIC II Regular Interests and the
         Class R-2 Certificates to receive distributions from the proceeds of
         REMIC II in respect of such Interests and such Class, and all ownership
         interests of the Holders of such Interests and such Class in such
         distributions, shall be as set forth in this Agreement.

                  (b) The Company, as of the Closing Date, and concurrently with
         the execution and delivery hereof, does hereby assign without recourse
         all the right, title and interest of the Company in and to the
         Uncertificated REMIC II Regular Interests to the Trustee for the
         benefit of the Holders of each Class of Certificates (other than the
         Class R-1 Certificates and Class R-2 Certificates). The Trustee
         acknowledges receipt of the Uncertificated REMIC II Regular Interests
         and declares that it holds and will hold the same in trust for the
         exclusive use and benefit of all present and future Holders of each
         Class of Certificates (other than the Class R-1 Certificates and Class
         R-2 Certificates). The rights of the Holders of each Class of
         Certificates (other than the Class R-1 Certificates and Class R-2
         Certificates) to receive distributions from the proceeds of REMIC III
         in respect of such Classes, and all ownership

                                      -33-
<PAGE>

         interests of the Holders of Classes in such distributions, shall be as
         set forth in this Agreement.

         Section 2.07      ISSUANCE OF CERTIFICATES EVIDENCING INTEREST IN REMIC
                           III.

         The Trustee acknowledges the assignment to it of the Uncertificated
REMIC II Regular Interests and, concurrently therewith and in exchange therefor,
pursuant to the written request of the Company executed by an officer of the
Company, the Trustee has executed and caused to be authenticated and delivered
to or upon the order of the Company, all Classes of Certificates (other than the
Class R-1 Certificates and Class R-2 Certificates) in authorized denominations,
which evidence ownership of the entire REMIC III.

                                      -34-
<PAGE>

                                   ARTICLE III

                          ADMINISTRATION AND SERVICING
                                OF MORTGAGE LOANS
                     (SEE ARTICLE III OF THE STANDARD TERMS)

                                      -35-
<PAGE>

                                   ARTICLE IV

                         PAYMENTS TO CERTIFICATEHOLDERS

         Section 4.01      CERTIFICATE ACCOUNT. (SEE SECTION 4.01 OF THE
                           STANDARD TERMS)

         Section 4.02      DISTRIBUTIONS.

                  (a) On each Distribution Date (x) the Master Servicer on
         behalf of the Trustee or (y) the Paying Agent appointed by the Trustee,
         shall distribute to the Master Servicer, in the case of a distribution
         pursuant to Section 4.02(a)(iii) below, the amount required to be
         distributed to the Master Servicer or a Sub-Servicer pursuant to
         Section 4.02(a)(iii) below, and to each Certificateholder of record on
         the next preceding Record Date (other than as provided in Section 9.01
         respecting the final distribution) either in immediately available
         funds (by wire transfer or otherwise) to the account of such
         Certificateholder at a bank or other entity having appropriate
         facilities therefor, if such Certificateholder has so notified the
         Master Servicer or the Paying Agent, as the case may be, or, if such
         Certificateholder has not so notified the Master Servicer or the Paying
         Agent by the Record Date, by check mailed to such Certificateholder at
         the address of such Holder appearing in the Certificate Register such
         Certificateholder's share (which share (A) with respect to each Class
         of Certificates (other than any Subclass of the Class A-V
         Certificates), shall be based on the aggregate of the Percentage
         Interests represented by Certificates of the applicable Class held by
         such Holder or (B) with respect to any Subclass of the Class A-V
         Certificates, shall be equal to the amount (if any) distributed
         pursuant to Section 4.02(a)(i) below to each Holder of a Subclass
         thereof) of the following amounts, in the following order of priority
         (subject to the provisions of Section 4.02(b) below), in each case to
         the extent of the Available Distribution Amount:

                           (i) (X) from the Available Distribution Amount
                  related to the Group 1 Loans, to the Group 1 Certificates
                  (other than the Class 1-A-P Certificates), on a pro rata basis
                  based on the Accrued Certificate Interest payable on such
                  Classes of Certificates (or Subclasses, if any, with respect
                  to the Class 1-A-V Certificates) for such Distribution Date,
                  plus any Accrued Certificate Interest thereon remaining unpaid
                  from any previous Distribution Date except as provided in the
                  last paragraph of this Section 4.02(a) (the "Group 1 Senior
                  Interest Distribution Amount"); and

                                    (Y) from the Available Distribution Amount
                  related to the Group 2 Loans, to the Group 2 Certificates
                  (other than the Class 2-A-P Certificates), on a pro rata basis
                  based on Accrued Certificate Interest payable on such Classes
                  of Certificates (or Subclasses, if any, with respect to the
                  Class 2-A-V Certificates) for such Distribution Date, plus any
                  Accrued Certificate Interest thereon remaining unpaid from any
                  previous Distribution Date except as provided in the last
                  paragraph of this Section 4.02(a) (the "Group 2 Senior
                  Interest Distribution Amount"); and

                                      -36-
<PAGE>

                           (ii) (X) to the Class A-P Certificates, the related
                  Class A-P Principal Distribution Amount (as defined in Section
                  4.02(b)(i) herein); and

                                    (Y) to the Senior Certificates (other than
                  the Class A-P Certificates), in the priorities and amounts set
                  forth in Section 4.02(b)(ii) through Section 4.02(e), the sum
                  of the following (applied to reduce the Certificate Principal
                  Balances of such Senior Certificates, as applicable):

                                    (A) the related Senior Percentage for such
                           Distribution Date times the sum of the following:

                                            (1) the principal portion of each
                                    Monthly Payment due during the related Due
                                    Period on each Outstanding Mortgage Loan
                                    (other than the related Discount Fraction of
                                    the principal portion of such payment with
                                    respect to a Discount Mortgage Loan) in the
                                    related Loan Group, whether or not received
                                    on or prior to the related Determination
                                    Date, minus the principal portion of any
                                    related Debt Service Reduction (other than
                                    the related Discount Fraction of the
                                    principal portion of such Debt Service
                                    Reductions with respect to each Discount
                                    Mortgage Loan in such Loan Group) which
                                    together with other Bankruptcy Losses
                                    exceeds the Bankruptcy Amount;

                                            (2) the Stated Principal Balance of
                                    any Mortgage Loan in the related Loan Group
                                    repurchased during the preceding calendar
                                    month (or deemed to have been so repurchased
                                    in accordance with Section 3.07(b) of the
                                    Standard Terms) pursuant to Sections 2.02,
                                    2.04 or 4.07 of the Standard Terms and
                                    Section 2.03 of the Standard Terms and this
                                    Series Supplement, and the amount of any
                                    shortfall deposited in the Custodial Account
                                    in connection with the substitution of a
                                    Deleted Mortgage Loan from the related Loan
                                    Group pursuant to Section 2.04 of the
                                    Standard Terms or Section 2.03 of the
                                    Standard Terms and this Series Supplement,
                                    during the preceding calendar month (other
                                    than the related Discount Fraction of such
                                    Stated Principal Balance or shortfall with
                                    respect to each Discount Mortgage Loan in
                                    such Loan Group); and

                                            (3) the principal portion of all
                                    other unscheduled collections with respect
                                    to the related Loan Group (other than
                                    Principal Prepayments in Full and
                                    Curtailments and amounts received in
                                    connection with a Cash Liquidation or REO
                                    Disposition of a Mortgage Loan in such Loan
                                    Group described in Section 4.02(a)(ii)(Y)(B)
                                    of this Series Supplement, including without
                                    limitation any related Insurance Proceeds,
                                    Liquidation Proceeds and

                                      -37-
<PAGE>

                                    REO Proceeds) received during the preceding
                                    calendar month (or deemed to have been so
                                    received in accordance with Section 3.07(b)
                                    of the Standard Terms) to the extent applied
                                    by the Master Servicer as recoveries of
                                    principal of the related Mortgage Loan
                                    pursuant to Section 3.14 of the Standard
                                    Terms (other than the related Discount
                                    Fraction of the principal portion of such
                                    unscheduled collections, with respect to
                                    each Discount Mortgage Loan);

                                    (B) with respect to each Mortgage Loan in
                           the related Loan Group for which a Cash Liquidation
                           or a REO Disposition occurred during the preceding
                           calendar month (or was deemed to have occurred during
                           such period in accordance with Section 3.07(b) of the
                           Standard Terms) and did not result in any Excess
                           Special Hazard Losses, Excess Fraud Losses, Excess
                           Bankruptcy Losses or Extraordinary Losses, an amount
                           equal to the lesser of (a) the related Senior
                           Percentage for such Distribution Date times the
                           Stated Principal Balance of such Mortgage Loan (other
                           than the related Discount Fraction of such Stated
                           Principal Balance, with respect to each Discount
                           Mortgage Loan) and (b) the related Senior Accelerated
                           Distribution Percentage for such Distribution Date
                           times the related unscheduled collections (including
                           without limitation Insurance Proceeds, Liquidation
                           Proceeds and REO Proceeds) to the extent applied by
                           the Master Servicer as recoveries of principal of the
                           related Mortgage Loan pursuant to Section 3.14 of the
                           Standard Terms (in each case other than the portion
                           of such unscheduled collections, with respect to a
                           Discount Mortgage Loan, included in Section
                           4.02(b)(i)(C) of this Series Supplement);

                                    (C) the related Senior Accelerated
                           Distribution Percentage for such Distribution Date
                           times the aggregate of all Principal Prepayments in
                           Full received in the related Prepayment Period and
                           Curtailments with respect to the related Loan Group
                           received in the preceding calendar month (other than
                           the related Discount Fraction of such Principal
                           Prepayments in Full and Curtailments, with respect to
                           each Discount Mortgage Loan);

                                    (D) any Excess Subordinate Principal Amount
                           for such Distribution Date allocated to the related
                           Loan Group but only to the extent of Eligible Funds
                           in the related Loan Group for such Distribution Date;

                                    (E) any amounts described in subsection
                           (ii)(Y), clauses (A), (B) and (C) of this Section
                           4.02(a), as determined for any previous Distribution
                           Date, which remain unpaid after application of
                           amounts previously distributed pursuant to this
                           clause (E) to the extent that such amounts are not
                           attributable to Realized Losses which have been
                           allocated to the Subordinate Certificates; and

                                      -38-
<PAGE>

                                    (F) to the Holders of the Group 1
                           Certificates or Group 2 Certificates, as applicable,
                           amounts required to be distributed pursuant to
                           Section 4.02(c);

                           (iii) if the Certificate Principal Balances of the
                  Subordinate Certificates have not been reduced to zero, to the
                  Master Servicer or a Sub-Servicer, by remitting for deposit to
                  the Custodial Account, to the extent of and in reimbursement
                  for any Advances or Sub-Servicer Advances previously made with
                  respect to any Mortgage Loan or REO Property which remain
                  unreimbursed in whole or in part following the Cash
                  Liquidation or REO Disposition of such Mortgage Loan or REO
                  Property, minus any such Advances that were made with respect
                  to delinquencies that ultimately constituted Excess Special
                  Hazard Losses, Excess Fraud Losses, Excess Bankruptcy Losses
                  or Extraordinary Losses;

                           (iv) to the Holders of the Class M-1 Certificates,
                  the Accrued Certificate Interest thereon for such Distribution
                  Date, plus any Accrued Certificate Interest thereon remaining
                  unpaid from any previous Distribution Date, except as provided
                  below;

                           (v) to the Holders of the Class M-1 Certificates, an
                  amount equal to (x) the Subordinate Principal Distribution
                  Amount derived from each Loan Group for such Class of
                  Certificates for such Distribution Date, minus (y) the amount
                  of any related Class A-P Collection Shortfalls for such
                  Distribution Date or remaining unpaid for all previous
                  Distribution Dates, to the extent the amounts available
                  pursuant to clause (x) of Sections 4.02(a)(vii), (ix), (xi),
                  (xiii), (xiv) and (xv) of this Series Supplement are
                  insufficient therefor, applied in reduction of the Certificate
                  Principal Balance of the Class M-1 Certificates;

                           (vi) to the Holders of the Class M-2 Certificates,
                  the Accrued Certificate Interest thereon for such Distribution
                  Date, plus any Accrued Certificate Interest thereon remaining
                  unpaid from any previous Distribution Date, except as provided
                  below;

                           (vii) to the Holders of the Class M-2 Certificates,
                  an amount equal to (x) the Subordinate Principal Distribution
                  Amount derived from each Loan Group for such Class of
                  Certificates for such Distribution Date, minus (y) the amount
                  of any related Class A-P Collection Shortfalls for such
                  Distribution Date or remaining unpaid for all previous
                  Distribution Dates, to the extent the amounts available
                  pursuant to clause (x) of Sections 4.02(a)(ix), (xi), (xiii),
                  (xiv) and (xv) of this Series Supplement are insufficient
                  therefor, applied in reduction of the Certificate Principal
                  Balance of the Class M-2 Certificates;

                                      -39-
<PAGE>

                           (viii) to the Holders of the Class M-3 Certificates,
                  the Accrued Certificate Interest thereon for such Distribution
                  Date, plus any Accrued Certificate Interest thereon remaining
                  unpaid from any previous Distribution Date, except as provided
                  below;

                           (ix) to the Holders of the Class M-3 Certificates, an
                  amount equal to (x) the Subordinate Principal Distribution
                  Amount derived from each Loan Group for such Class of
                  Certificates for such Distribution Date minus (y) the amount
                  of any related Class A-P Collection Shortfalls for such
                  Distribution Date or remaining unpaid for all previous
                  Distribution Dates, to the extent the amounts available
                  pursuant to clause (x) of Sections 4.02(a)(xi), (xiii), (xiv)
                  and (xv) of this Series Supplement are insufficient therefor,
                  applied in reduction of the Certificate Principal Balance of
                  the Class M-3 Certificates;

                           (x) to the Holders of the Class B-1 Certificates, the
                  Accrued Certificate Interest thereon for such Distribution
                  Date, plus any Accrued Certificate Interest thereon remaining
                  unpaid from any previous Distribution Date, except as provided
                  below;

                           (xi) to the Holders of the Class B-1 Certificates, an
                  amount equal to (x) the Subordinate Principal Distribution
                  Amount derived from each Loan Group for such Class of
                  Certificates for such Distribution Date minus (y) the amount
                  of any related Class A-P Collection Shortfalls for such
                  Distribution Date or remaining unpaid for all previous
                  Distribution Dates, to the extent the amounts available
                  pursuant to clause (x) of Sections 4.02(a)(xiii), (xiv) and
                  (xv) of this Series Supplement are insufficient therefor,
                  applied in reduction of the Certificate Principal Balance of
                  the Class B-1 Certificates;

                           (xii) to the Holders of the Class B-2 Certificates,
                  the Accrued Certificate Interest thereon for such Distribution
                  Date, plus any Accrued Certificate Interest thereon remaining
                  unpaid from any previous Distribution Date, except as provided
                  below;

                           (xiii) to the Holders of the Class B-2 Certificates,
                  an amount equal to (x) the Subordinate Principal Distribution
                  Amount derived from each Loan Group for such Class of
                  Certificates for such Distribution Date minus (y) the amount
                  of any related Class A-P Collection Shortfalls for such
                  Distribution Date or remaining unpaid for all previous
                  Distribution Dates, to the extent the amounts available
                  pursuant to clause (x) of Sections 4.02(a)(xiv) and (xv) of
                  this Series Supplement are insufficient therefor, applied in
                  reduction of the Certificate Principal Balance of the Class
                  B-2 Certificates;

                           (xiv) to the Holders of the Class B-3 Certificates,
                  an amount equal to (x)

                                      -40-
<PAGE>

                  the Accrued Certificate Interest thereon for such Distribution
                  Date, plus any Accrued Certificate Interest thereon remaining
                  unpaid from any previous Distribution Date, except as provided
                  below, minus (y) the amount of any Class A-P Collection
                  Shortfalls for such Distribution Date or remaining unpaid for
                  all previous Distribution Dates, to the extent the amounts
                  available pursuant to clause (x) of Section 4.02(a) (xv) of
                  this Series Supplement are insufficient therefor;

                           (xv) to the Holders of the Class B-3 Certificates, an
                  amount equal to (x) the Subordinate Principal Distribution
                  Amount derived from each Loan Group for such Class of
                  Certificates for such Distribution Date minus (y) the amount
                  of any related Class A-P Collection Shortfalls for such
                  Distribution Date or remaining unpaid for all previous
                  Distribution Dates applied in reduction of the Certificate
                  Principal Balance of the Class B-3 Certificates;

                           (xvi) to the Senior Certificates, in the priority set
                  forth in Section 4.02(b) of this Series Supplement, the
                  portion, if any, of the Available Distribution Amount for the
                  related Loan Group remaining after the foregoing
                  distributions, applied to reduce the Certificate Principal
                  Balances of such Senior Certificates, but in no event more
                  than the aggregate of the outstanding Certificate Principal
                  Balances of each such Class of Senior Certificates, and
                  thereafter, to each Class of Subordinate Certificates then
                  outstanding beginning with such Class with the Highest
                  Priority, any portion of the Available Distribution Amount for
                  each Loan Group remaining after the Senior Certificates have
                  been retired, applied to reduce the Certificate Principal
                  Balance of each such Class of Subordinate Certificates, but in
                  no event more than the outstanding Certificate Principal
                  Balance of each such Class of Subordinate Certificates; and

                           (xvii) to the Class R-2 Certificates, the balance, if
                  any, of the Available Distribution Amount for both Loan
                  Groups.

         Notwithstanding the foregoing, on any Distribution Date, with respect
to the Class of Subordinate Certificates outstanding on such Distribution Date
with the Lowest Priority, or in the event the Subordinate Certificates are no
longer outstanding, the Senior Certificates, Accrued Certificate Interest
thereon remaining unpaid from any previous Distribution Date will be
distributable only to the extent that such unpaid Accrued Certificate Interest
was attributable to interest shortfalls relating to the failure of the Master
Servicer to make any required Advance, or the determination by the Master
Servicer that any proposed Advance would be a Nonrecoverable Advance with
respect to the related Mortgage Loan where such Mortgage Loan has not yet been
the subject of a Cash Liquidation or REO Disposition or the related Liquidation
Proceeds, Insurance Proceeds and REO Proceeds have not yet been distributed to
the Certificateholders.

                  (b) Distributions of principal on the Senior Certificates on
         each Distribution Date occurring prior to the Credit Support Depletion
         Date will be made as follows:

                                      -41-
<PAGE>

                           (i) to the Class 1-A-P Certificates and Class 2-A-P
                  Certificates from the related Available Distribution Amount,
                  until the Certificate Principal Balance thereof is reduced to
                  zero, an amount (in the case of the Class 1-A-P Certificates,
                  the "Class 1-A-P Principal Distribution Amount," and in the
                  case of the Class 2-A-P Certificates, the "Class 2-A-P
                  Principal Distribution Amount," and collectively, the "Class
                  A-P Principal Distribution Amount") equal to the aggregate of:

                                    (A) the related Discount Fraction of the
                           principal portion of each Monthly Payment on each
                           Discount Mortgage Loan in the related Loan Group due
                           during the related Due Period, whether or not
                           received on or prior to the related Determination
                           Date, minus the Discount Fraction of the principal
                           portion of any related Debt Service Reduction which
                           together with other Bankruptcy Losses exceeds the
                           Bankruptcy Amount;

                                    (B) the related Discount Fraction of the
                           principal portion of all unscheduled collections on
                           each Discount Mortgage Loan in the related Loan Group
                           received during the preceding calendar month or, in
                           the case of Principal Prepayments in Full, during the
                           related Prepayment Period (other than amounts
                           received in connection with a Cash Liquidation or REO
                           Disposition of a Discount Mortgage Loan described in
                           clause (C) below), including Principal Prepayments in
                           Full, Curtailments and repurchases (including deemed
                           repurchases under Section 3.07(b) of the Standard
                           Terms) of Discount Mortgage Loans in the related Loan
                           Group (or, in the case of a substitution of a Deleted
                           Mortgage Loan, the Discount Fraction of the amount of
                           any shortfall deposited in the Custodial Account in
                           connection with such substitution);

                                    (C) in connection with the Cash Liquidation
                           or REO Disposition of a Discount Mortgage Loan in the
                           related Loan Group that did not result in any Excess
                           Special Hazard Losses, Excess Fraud Losses, Excess
                           Bankruptcy Losses or Extraordinary Losses, an amount
                           equal to the lesser of (1) the applicable Discount
                           Fraction of the Stated Principal Balance of such
                           Discount Mortgage Loan immediately prior to such
                           Distribution Date and (2) the aggregate amount of the
                           collections on such Discount Mortgage Loan to the
                           extent applied as recoveries of principal;

                                    (D) any amounts allocable to principal for
                           the related Loan Group for any previous Distribution
                           Date (calculated pursuant to clauses (A) through (C)
                           above) that remain undistributed; and

                                    (E) the amount of any related Class A-P
                           Collection Shortfalls for such Distribution Date and
                           the amount of any such Class A-P Collection

                                      -42-
<PAGE>

                           Shortfalls remaining unpaid for all previous
                           Distribution Dates, but only to the extent of the
                           Eligible Funds in the related Loan Group for such
                           Distribution Date;

                           (ii) Group 1 Senior Principal Distribution Amount
                  shall be distributed, concurrently on a pro rata basis, to the
                  Class 1-A-4 Certificates and Class 1-A-20 Certificates, in
                  reduction of the Certificate Principal Balance thereof, until
                  the Certificate Principal Balance thereof has been reduced to
                  zero, in an amount equal to the Lockout Percentage of the
                  Class 1-A-4 Certificates and Class 1-A-20 Certificates PRO
                  RATA share (based on the Certificate Principal Balance thereof
                  relative to the aggregate Stated Principal Balance of the
                  Group 1 Loans (other than the related Discount Fraction of the
                  Discount Mortgage Loans in Loan Group 1)) of the aggregate of
                  the collections described in Section 4.02(a)(ii)(Y)(A), (B),
                  (C) and (E) without any application of the Group 1 Senior
                  Percentage or Group 1 Senior Accelerated Distribution
                  Percentage;

         PROVIDED that, if the aggregate of the amounts set forth in Section
         4.02(a)(ii)(Y)(A), (B), (C) and (E) is more than the balance of the
         related Available Distribution Amount remaining after the related
         Senior Interest Distribution Amount and the Class 1-A-P Distribution
         Amount have been distributed, the amount paid to the Class 1-A-4
         Certificates and Class 1- A-20 Certificates pursuant to this clause
         (ii) shall be reduced by an amount equal to the Class 1-A-4 and Class
         1-A-20 Certificates PRO RATA share (based on the Certificate Principal
         Balance thereof related to the aggregate Stated Principal Balance of
         the Group 1 Loans (other than the related Discount Fraction of the
         Discount Mortgage Loans in Loan Group 1)) of such difference;

                           (iii) the balance of the Group 1 Senior Principal
         Distribution Amount remaining after the distribution described in
         clause (ii) above shall be distributed, concurrently as follows:

                           (A) 8.73615756% to the Class 1-A-3 Certificates,
                until the Certificate Principal Balance thereof has been reduced
                to zero; and

                           (B) 91.26384244% in the following manner and
                  priority:

                                    (1) FIRST, to the Class 1-A-1, Class 1-A-14
                           and Class 1-A-15 Certificates, in each case until the
                           aggregate of the Certificate Principal Balances of
                           the Class 1-A-1, Class 1-A-14 and Class 1-A-15
                           Certificates has been reduced to the Aggregate
                           Planned Principal Balance for such Distribution Date,
                           concurrently as follows:

                                             (a) 29.13728657% to the Class 1-A-1
                                    Certificates, until the Certificate
                                    Principal Balance thereof has been reduced
                                    to zero; and

                                      -43-
<PAGE>

                                             (b) 70.86271343% sequentially to
                                    the Class 1-A-15 Certificates and Class
                                    1-A-14 Certificates, in each case until the
                                    Certificate Principal Balance thereof has
                                    been reduced to zero;

                                    (2) SECOND, concurrently on a pro rata
                           basis, to the Class 1-A-7 Certificates and Class
                           1-A-8 Certificates, until the Certificate Principal
                           Balances thereof have been reduced to zero; and

                                    (3) THIRD, to the Class 1-A-1, Class 1-A-14
                           and Class 1-A-15 Certificates, in the manner and
                           priority set forth in clause (iii)(B)(1) above,
                           without regard to the Aggregate Planned Principal
                           Balance for such Distribution Date, in each case
                           until the Certificate Principal Balance thereof has
                           been reduced to zero;

                (iv) the balance of the Group 1 Senior Principal Distribution
      Amount remaining after the distributions described in clauses (ii) and
      (iii) above shall be distributed to the Class 1-A-2 Certificates, until
      the Certificate Principal Balance thereof has been reduced to zero;

                (v) the balance of the Group 1 Senior Principal Distribution
      Amount remaining after the distributions described in clauses (ii) through
      (iv) above shall be distributed to the Class 1- A-5, Class 1-A-6, Class
      1-A-9, Class 1-A-10, Class 1-A-11, Class 1-A-12 and Class 1-A-13
      Certificates, concurrently as follows:

                                             (a) 47.06473982% sequentially to
                                    the Class 1-A-9, Class 1-A-10, Class 1-A-11,
                                    Class 1-A-12 and Class 1- A-13 Certificates,
                                    in each case until the Certificate Principal
                                    Balance thereof has been reduced to zero;
                                    and

                                             (b) 52.93526018% sequentially to
                                    the Class 1-A-5 Certificates and Class 1-A-6
                                    Certificates, in each case until the
                                    Certificate Principal Balance thereof has
                                    been reduced to zero; and

                (vi) the balance of the Group 1 Senior Principal Distribution
      Amount remaining after the distributions described in clauses (ii) through
      (v) above shall be distributed, concurrently on a pro rata basis, to the
      Class 1-A-4 Certificates and Class 1-A-20 Certificates, until the
      Certificate Principal Balances thereof has been reduced to zero.

                (vii) the Group 2 Senior Principal Distribution Amount shall be
      distributed, concurrently on a pro rata basis, to the Class R-1, Class R-2
      and Class R-3 Certificates, until the Certificate Principal Balances
      thereof have been reduced to zero;

                                      -44-
<PAGE>

                (viii) the balance of the Group 2 Senior Principal Distribution
      Amount remaining after the distribution described in clause (vii) above
      shall be distributed to the Class 2-A-12 Certificates, in reduction of the
      Certificate Principal Balance thereof, until the Certificate Principal
      Balance thereof has been reduced to zero, in an amount equal to the
      Lockout Percentage of the Class 2-A-12 Certificates PRO RATA share (based
      on the Certificate Principal Balance thereof relative to the aggregate
      Stated Principal Balance of the Group 2 Loans (other than the related
      Discount Fraction of the Discount Mortgage Loans in Loan Group 2)) of the
      aggregate of the collections described in Section 4.02(a)(ii)(Y)(A), (B)
      and (E) without any application of the Group 2 Senior Percentage or Group
      2 Senior Accelerated Distribution Percentage;

      PROVIDED that, if the aggregate of the amounts set forth in Section
      4.02a(ii)(Y)(A), (B) and (E) is more than the balance of the related
      Available Distribution Amount remaining after the related Senior Interest
      Distribution Amount and the Class 2-A-P Distribution Amount have been
      distributed, the amount paid to the Class 2-A-12 Certificates pursuant to
      this clause (viii) shall be reduced by an amount equal to the Class 2-A-12
      Certificates PRO RATA share (based on the Certificate Principal Balance
      thereof related to the aggregate Stated Principal Balance of the Group 2
      Loans (other than the related Discount Fraction of the Discount Mortgage
      Loans in Loan Group 2)) of such difference;

                (ix) the balance of the Group 2 Senior Principal Distribution
      Amount remaining after the distributions described in clauses (vii) and
      (viii) above shall be distributed, concurrently as follows:

                           (A) 26.38884491% to the Class 2-A-4 Certificates,
                until the Certificate Principal Balance thereof has been reduced
                to zero; and

                           (B) 73.61115509% in the following manner and
                  priority:

                                    (1) FIRST, sequentially, to the Class 2-A-1
                           Certificates and Class 2-A- 13 Certificates, in each
                           case until the Certificate Principal Balance thereof
                           has been reduced to the Aggregate Planned Principal
                           Balance for such Distribution Date;

                                    (2) SECOND, concurrently on a pro rata
                           basis, to the Class 2-A-2 and Class 2-A-3
                           Certificates, until the Certificate Principal
                           Balances thereof have been reduced to zero;

                                    (3) THIRD, sequentially, to the Class 2-A-1
                           Certificates and Class 2-A- 13 Certificates, without
                           regard to the Planned Principal Balance for such
                           Distribution Date, in each case until the Certificate
                           Principal Balance thereof has been reduced to zero;

                                      -45-
<PAGE>

                (x) the balance of the Group 2 Senior Principal Distribution
      Amount remaining after the distributions described in clauses (vii)
      through (ix) above shall be distributed to the Class 2-A-6 Certificates,
      until the Certificate Principal Balance thereof has been reduced to zero;

                (xi) the balance of the Group 2 Senior Principal Distribution
      Amount remaining after the distributions described in clauses (vii)
      through (x) above shall be distributed, concurrently on a pro rata basis,
      to the Class 2-A-7 Certificates and Class 2-A-8 Certificates, until the
      Certificate Principal Balances thereof have been reduced to zero;

                (xii) the balance of the Group 2 Senior Principal Distribution
      Amount remaining after the distributions described in clauses (vii)
      through (xi) above shall be distributed, concurrently on a pro rata basis,
      to the Class 2-A-9 Certificates and Class 2-A-10 Certificates, until the
      Certificate Principal Balances thereof have been reduced to zero; and

                (xiii) the balance of the Group 2 Senior Principal Distribution
      Amount remaining after the distributions described in clauses (vii)
      through (xii) above shall be distributed to the Class 2-A-12 Certificates,
      until the Certificate Principal Balance thereof has been reduced to zero.

         (c) Prior to the occurrence of the Credit Support Depletion Date but
      after the reduction of the Certificate Principal Balances of either the
      Group 1 Certificates or the Group 2 Certificates to zero, the remaining
      Group 1 Certificates or Group 2 Certificates as applicable, will be
      entitled to receive, in addition to any Principal Prepayments in Full and
      Curtailments related to such Certificates' respective Loan Group, 100% of
      the Principal Prepayments in Full and Curtailments on the Mortgage Loans
      in the other Loan Group, and in accordance with the priorities set forth
      in clause 4.02(b) above, and in reduction of the Certificate Principal
      Balances thereof, on any Distribution Date unless (i) the weighted average
      of the initial Subordinate Percentages for both Loan Groups, weighted on
      the basis of the Stated Principal Balances of the Mortgage Loans in the
      related Loan Group, is at least two times the weighted average of the
      initial Subordinate Percentages for both Loan Groups (calculated on such
      basis) and (ii) the outstanding principal balance of the Mortgage Loans in
      both Loan Groups delinquent 60 days or more averaged over the last six
      months, as a percentage of the aggregate outstanding Certificate Principal
      Balance of the Class M Certificates and Class B Certificates, is less than
      50%. In addition, on any Distribution Date prior to the Credit Support
      Depletion Date on which the aggregate Certificate Principal Balance of
      either the Group 1 Certificates or the Group 2 Certificates, as
      applicable, is greater than the aggregate Stated Principal Balance of the
      Mortgage Loans in the related Loan Group in each case after giving effect
      to distributions to be made on such Distribution Date, (1) 100% of the
      Principal Prepayments in Full and Curtailments allocable to the Class M
      Certificates and Class B Certificates on the Mortgage Loans in the other
      Loan Group will be distributed to such Class or Classes of Group 1
      Certificates or Group 2 Certificates, as applicable, and in accordance
      with the priorities set forth in clause 4.02(b) above, and in reduction of
      the Certificate Principal Balances thereof, until the aggregate
      Certificate Principal Balance of such Class or Classes of Certificates
      equals the aggregate Stated Principal Balance of the Mortgage Loans in the
      related Loan Group, and (2)

                                      -46-
<PAGE>

      an amount equal to one month's interest at the applicable Pass-Through
      Rate for such Class or Classes of Certificates on the amount of such
      difference will be distributed from the Available Distribution Amount for
      the other Loan Group allocable to the Class M Certificates and Class B
      Certificates first to pay any unpaid interest on such Class or Classes of
      Certificates and then to pay principal on such Classes in the manner
      described in (1) above.

         (d) On or after the occurrence of the Credit Support Depletion Date but
      prior to the reduction of the Certificate Principal Balances of the Senior
      Support Certificates to zero, all priorities relating to distributions as
      described above in respect of principal among the various Classes of
      Senior Certificates (other than the Class A-P Certificates) will be
      disregarded, and (i) the remaining Group 1 Senior Principal Distribution
      Amount will be distributed to the Group 1 Certificates (other than the
      Class 1-A-P Certificates) pro rata in accordance with their respective
      outstanding Certificate Principal Balances, (ii) the remaining Group 2
      Senior Principal Distribution Amount will be distributed to the Group 2
      Certificates (other than the Class 2-A-P Certificates) pro rata in
      accordance with their respective outstanding Certificate Principal
      Balances, (iii) the related Senior Interest Distribution Amount will be
      distributed as described in Section 4.02(a)(i)(X) and (Y) and (iv) an
      amount equal to the Discount Fraction of the principal portion of
      scheduled payments and unscheduled collections received or advanced in
      respect of Discount Mortgage Loans in each Loan Group will be distributed
      to the related Class A-P Certificates;, provided that the aggregate amount
      distributable to the Senior Support Certificates and Super Senior
      Certificates will be distributed among such Certificates in the following
      priority: first, to the related Super Senior Certificates, up to an amount
      equal to the Accrued Certificate Interest thereon; second to the related
      Super Senior Certificates, up to the related Super Senior Optimal
      Principal Distribution Amount, in reduction of the Certificate Principal
      Balance thereof, until such Certificate Principal Balance has been reduced
      to zero; third, to the related Senior Support Certificates, up to an
      amount equal to the Accrued Certificate Interest thereon; and fourth, to
      the related Senior Support Certificates, the remainder, until the
      Certificate Principal Balance thereof is reduced to zero.

         (e) On or after the occurrence of the Credit Support Depletion Date and
      upon reduction of the Certificate Principal Balances of the Senior Support
      Certificates to zero, all priorities relating to distributions as
      described above in respect of principal among the various Classes of
      Senior Certificates (other than the Class A-P Certificates) will be
      disregarded, and (i) the remaining Group 1 Senior Principal Distribution
      Amount will be distributed to the Group 1 Certificates (other than the
      Class 1-A-P Certificates) pro rata in accordance with their respective
      outstanding Certificate Principal Balances, (ii) the remaining Group 2
      Senior Principal Distribution Amount will be distributed to the Group 2
      Certificates (other than the Class 2-A-P Certificates) pro rata in
      accordance with their respective outstanding Certificate Principal
      Balances, (iii) the related Senior Interest Distribution Amount will be
      distributed as described in Section 4.02(a)(i)(X) and (Y) and (iv) an
      amount equal to the Discount Fraction of the principal portion of
      scheduled payments and unscheduled collections received or advanced in
      respect of Discount Mortgage Loans in each Loan Group will be distributed
      to the related Class A-P Certificates; provided that the aggregate amount
      distributable to the Super Senior

                                      -47-
<PAGE>

      Certificates and Senior Support Certificates in respect of the aggregate
      Accrued Certificate Interest thereon and in respect of their aggregate pro
      rata portion of the Senior Principal Distribution Amount will be
      distributed among those certificates in the following priority: first, to
      the Super Senior Certificates, up to an amount equal to the Accrued
      Certificate Interest on those Super Senior Certificates; second, to the
      Super Senior Certificates, up to an amount equal to the Super Senior
      Optimal Principal Distribution Amount, in reduction of the Certificate
      Principal Balance thereof, until the Certificate Principal Balance thereof
      has been reduced to zero; third, to the Senior Support Certificates, up to
      an amount equal to the Accrued Certificate Interest thereon; and fourth,
      to the Senior Support Certificates, the remainder, until the Certificate
      Principal Balance thereof has been reduced to zero.

         (f) On or after the occurrence of the Credit Support Depletion Date and
      after the reduction of the Certificate Principal Balance of the Senior
      Support Certificates to zero, all priorities relating to distributions as
      described above in respect of principal among the various classes of
      Senior Certificates (other than the Class A-P Certificates) will be
      disregarded, and (i) the remaining Group 1 Principal Distribution Amount
      will be distributed to the Group 1 Certificates (other than the Class
      1-A-P Certificates) pro rata in accordance with their respective
      outstanding Certificate Principal Balances, (ii) the remaining Group 2
      Principal Distribution Amount will be distributed to the Group 2
      Certificates (other than the Class 2-A-P Certificates) pro rata in
      accordance with their respective outstanding Certificate Principal
      Balances, (iii) the Senior Interest Distribution Amount will be
      distributed as described under "--Interest Distributions" and (iv) an
      amount equal to the Discount Fraction of the principal portion of
      scheduled payments and unscheduled collections received or advanced in
      respect of Discount Mortgage Loans in each loan group will be distributed
      to the related Class A-P Certificates.

         (g) After the reduction of the Certificate Principal Balances of the
      Senior Certificates in a certificate group (other than the related Class
      A-P Certificates) to zero but prior to the Credit Support Depletion Date,
      the related Senior Certificates (other than the related Class A-P
      Certificates) will be entitled to no further distributions of principal
      thereon and the related Available Distribution Amount will be paid solely
      to the holders of the related Class A-P Certificates, the related Variable
      Strip Certificates and the Subordinate Certificates, in each case as
      described herein.

         (h) In addition to the foregoing distributions, with respect to any
      Mortgage Loan that was previously the subject of a Cash Liquidation or an
      REO Disposition that resulted in a Realized Loss, in the event that within
      two years of the date on which such Realized Loss was determined to have
      occurred the Master Servicer receives amounts, which the Master Servicer
      reasonably believes to represent subsequent recoveries (net of any related
      liquidation expenses), or determines that it holds surplus amounts
      previously reserved to cover estimated expenses, specifically related to
      such Mortgage Loan (including, but not limited to, recoveries in respect
      of the representations and warranties made by the related Seller pursuant
      to the applicable Seller's Agreement and assigned to the Trustee pursuant
      to Section 2.04), the Master Servicer shall distribute such amounts to the
      applicable Certificateholders of the Class or Classes to

                                      -48-
<PAGE>

      which such Realized Loss was allocated (with the amounts to be distributed
      allocated among such Classes in the same proportions as such Realized Loss
      was allocated), and within each such Class to the Certificateholders of
      record as of the Record Date immediately preceding the date of such
      distribution (or if such Class of Certificates is no longer outstanding,
      to the Certificateholders of record at the time that such Realized Loss
      was allocated); provided that no such distribution to any Class of
      Certificates of subsequent recoveries related to a Mortgage Loan shall
      exceed, either individually or in the aggregate and together with any
      other amounts paid in reimbursement therefor, the amount of the related
      Realized Loss that was allocated to such Class of Certificates.
      Notwithstanding the foregoing, no such distribution shall be made with
      respect to the Certificates of any Class to the extent that either (i)
      such Class was protected against the related Realized Loss pursuant to any
      instrument or fund established under Section 11.01(e) or (ii) such Class
      of Certificates has been deposited into a separate trust fund or other
      structuring vehicle and separate certificates or other instruments
      representing interests therein have been issued in one or more classes,
      and any of such separate certificates or other instruments were protected
      against the related Realized Loss pursuant to any limited guaranty,
      payment obligation, irrevocable letter of credit, surety bond, insurance
      policy or similar instrument or a reserve fund, or a combination thereof.
      Any amount to be so distributed with respect to the Certificates of any
      Class shall be distributed by the Master Servicer to the
      Certificateholders of record as of the Record Date immediately preceding
      the date of such distribution (i) with respect to the Certificates of any
      Class (other than the Class A-V Certificates), on a pro rata basis based
      on the Percentage Interest represented by each Certificate of such Class
      as of such Record Date and (ii) with respect to the Class A-V
      Certificates, to the related Class A-V Certificates or any Subclass
      thereof in the same proportion as the related Realized Loss was allocated.
      Any amounts to be so distributed shall not be remitted to or distributed
      from the Trust Fund, and shall constitute subsequent recoveries with
      respect to Mortgage Loans that are no longer assets of the Trust Fund.

         (i) Each distribution with respect to a Book-Entry Certificate shall be
      paid to the Depository, as Holder thereof, and the Depository shall be
      solely responsible for crediting the amount of such distribution to the
      accounts of its Depository Participants in accordance with its normal
      procedures. Each Depository Participant shall be responsible for
      disbursing such distribution to the Certificate Owners that it represents
      and to each indirect participating brokerage firm (a "brokerage firm") for
      which it acts as agent. Each brokerage firm shall be responsible for
      disbursing funds to the Certificate Owners that it represents. None of the
      Trustee, the Certificate Registrar, the Company or the Master Servicer
      shall have any responsibility therefor.

         (j) Except as otherwise provided in Section 9.01, if the Master
      Servicer anticipates that a final distribution with respect to any Class
      of Certificates will be made on the next Distribution Date, the Master
      Servicer shall, no later than the Determination Date in the month of such
      final distribution, notify the Trustee and the Trustee shall, no later
      than two (2) Business Days after such Determination Date, mail on such
      date to each Holder of such Class of Certificates a notice to the effect
      that: (i) the Trustee anticipates that the final distribution with

                                      -49-
<PAGE>

      respect to such Class of Certificates will be made on such Distribution
      Date but only upon presentation and surrender of such Certificates at the
      office of the Trustee or as otherwise specified therein, and (ii) no
      interest shall accrue on such Certificates from and after the end of the
      related Interest Accrual Period. In the event that Certificateholders
      required to surrender their Certificates pursuant to Section 9.01(c) do
      not surrender their Certificates for final cancellation, the Trustee shall
      cause funds distributable with respect to such Certificates to be
      withdrawn from the Certificate Account and credited to a separate escrow
      account for the benefit of such Certificateholders as provided in Section
      9.01(d).

      Section 4.03         STATEMENTS TO CERTIFICATEHOLDERS. (SEE SECTION
                           4.03(A) THROUGH (D) OF THE STANDARD TERMS AND EXHIBIT
                           FOUR ATTACHED HERETO)

      (e) The Trustee will make the reports referred to in this Section 4.03
(and, at its option, any additional files containing the same information in an
alternative format) available each month to Certificateholders and other parties
to the Agreement via the Trustee's website, which is presently located at
www.abs.bankone.com. Persons that are unable to use the above website are
entitled to have a paper copy mailed to them via first class mail by calling the
Trustee at (800) 524-9472. The Trustee shall have the right to change the way
the reports referred to in this Section 4.03 are distributed in order to make
such distribution more convenient and/or more accessible to the above parties
and to the Certificateholders. The Trustee shall provide timely and adequate
notification to all the parties mentioned above and to the Certificateholders
regarding any such change.

      Section 4.04         DISTRIBUTION OF REPORTS TO THE TRUSTEE AND THE
                           COMPANY; ADVANCES BY THE MASTER SERVICER. (SEE
                           SECTION 4.04 OF THE STANDARD TERMS)

      Section 4.05         ALLOCATION OF REALIZED LOSSES.

      Prior to each Distribution Date, the Master Servicer shall determine the
total amount of Realized Losses, if any, that resulted from any Cash
Liquidation, Servicing Modification, Debt Service Reduction, Deficient Valuation
or REO Disposition that occurred during the related Prepayment Period or, in the
case of a Servicing Modification that constitutes a reduction of the interest
rate on a Mortgage Loan, the amount of the reduction in the interest portion of
the Monthly Payment due during the related Due Period. The amount of each
Realized Loss shall be evidenced by an Officers' Certificate. All Realized
Losses, other than Excess Special Hazard Losses, Extraordinary Losses, Excess
Bankruptcy Losses or Excess Fraud Losses, shall be allocated as follows: first,
to the Class B-3 Certificates until the Certificate Principal Balance thereof
has been reduced to zero; second, to the Class B-2 Certificates until the
Certificate Principal Balance thereof has been reduced to zero; third, to the
Class B-1 Certificates until the Certificate Principal Balance thereof has been
reduced to zero; fourth, to the Class M-3 Certificates until the Certificate
Principal Balance thereof has been reduced to zero; fifth, to the Class M-2
Certificates until the Certificate Principal Balance thereof has been reduced to
zero; sixth, to the Class M-1 Certificates until the Certificate Principal
Balance thereof has been reduced to zero; and, thereafter, if any such Realized
Losses are on a Discount Mortgage Loan, to the related Class A-P Certificates in
an amount equal to the related Discount

                                      -50-
<PAGE>

Fraction of the principal portion thereof, and the remainder of such Realized
Losses on the Discount Mortgage Loans and the entire amount of such Realized
Losses on Non-Discount Mortgage Loans (A) in the case of a Group 1 Loan, among
the Group 1 Certificates (other than the Class 1-A-P Certificates) and the Class
1-A-V Certificates in the case of an interest loss, on a pro rata basis or (B)
in the case of a Group 2 Loan, among the Group 2 Certificates (other than the
Class 2-A-P Certificates) and the Class 2-A-V Certificates in the case of an
interest loss, on a pro rata basis (subject to Section 4.02(c)), as described
below. Any Excess Special Hazard Losses, Excess Bankruptcy Losses, Excess Fraud
Losses, Extraordinary Losses on Discount Mortgage Loans will be allocated to the
Class A-P Certificates in an amount equal to the Discount Fraction thereof and
the Group 1 Senior Percentage or Group 2 Senior Percentage (as applicable) of
the remainder of such Realized Losses on the Discount Mortgage Loans and the
entire amount of such Realized Losses on Non-Discount Mortgage Loans will be
allocated (A) in the case of a Group 1 Loan, among the Group 1 Certificates
(other than the Class 1-A-P Certificates) and the Class 1-A-V Certificates in
the case of an interest loss, on a pro rata basis or (B) in the case of a Group
2 Loan, among the Group 2 Certificates (other than the Class 2-A-P Certificates)
and the Class 2-A-V Certificates in the case of an interest loss, on a pro rata
basis, as described below; and the remainder of such Realized Losses will be
allocated among the Class M Certificates and Class B Certificates, on a pro rata
basis, as described below , provided, however, that Realized Losses otherwise
allocable to the Super Senior Certificates will be allocated to the related
Senior Support Certificates until the Certificate Principal Balance of such
Senior Support Certificates is reduced to zero.

      As used herein, an allocation of a Realized Loss on a "pro rata basis"
among two or more specified Classes of Certificates means an allocation on a pro
rata basis, among the various Classes so specified, to each such Class of
Certificates on the basis of their then outstanding Certificate Principal
Balances prior to giving effect to distributions to be made on such Distribution
Date in the case of the principal portion of a Realized Loss (without regard to
any Compensating Interest for such Distribution Date) in the case of an interest
portion of a Realized Loss. Except as provided in the following sentence, any
allocation of the principal portion of Realized Losses (other than Debt Service
Reductions) to a Class of Certificates shall be made by reducing the Certificate
Principal Balance thereof by the amount so allocated, which allocation shall be
deemed to have occurred on such Distribution Date. Any allocation of the
principal portion of Realized Losses (other than Debt Service Reductions) to the
Subordinate Certificates then outstanding with the Lowest Priority shall be made
by operation of the definition of "Certificate Principal Balance" and by
operation of the provisions of Section 4.02(a). Allocations of the principal
portion of Debt Service Reductions shall be made by operation of the provisions
of Section 4.02(a). All Realized Losses and all other losses allocated to a
Class of Certificates hereunder will be allocated among the Certificates of such
Class in proportion to the Percentage Interests evidenced thereby.

      Section 4.06         REPORTS OF FORECLOSURES AND ABANDONMENT OF MORTGAGED
                           PROPERTY. (SEE SECTION 4.06 OF THE STANDARD TERMS)

      Section 4.07         OPTIONAL PURCHASE OF DEFAULTED MORTGAGE LOANS. (SEE
                           SECTION 4.07 OF THE STANDARD TERMS)

                                      -51-
<PAGE>

      Section 4.08         SURETY BOND. (SEE SECTION 4.08 OF THE STANDARD TERMS)

      Section 4.09         DISTRIBUTIONS ON THE UNCERTIFICATED REMIC I REGULAR
                           INTERESTS.

         (i) Uncertificated REMIC I Accrued Interest on the REMIC I Regular
      Interests for such Distribution Date, plus any Uncertificated REMIC I
      Accrued Interest thereon remaining unpaid from any previous Distribution
      Date; and

         (ii) In accordance with the priorities set forth in Section 4.09(b), an
      amount equal to the sum of the amounts in respect of principal
      distributable on the REMIC II Certificates and the REMIC III Certificates
      (other than the Class 1-A-16 Certificates, Class 1-A-17 Certificates,
      Class 1-A-18 Certificates, Class 1-A-19 Certificates, Class 2-A-5
      Certificates, Class 2-A-11 Certificates, Class 1-A-V Certificates and
      Class 2-A-V Certificates) under Section 4.02(a), as allocated thereto
      pursuant to Section 4.02(b).

      (b) The amount described in Section 4.09(a)(ii) shall be deemed
distributed first, in an amount equal to the sum of the amounts in respect of
principal distributable (or deemed distributable) on REMIC II Regular Interest
Y, REMIC II Regular Interest Z and the Class R-2 Certificate pursuant to
Sections 4.10 and 4.02, to REMIC I Regular Interests LT-1P, LT-2P and LT- 2R in
the same amounts and priorities as distributed to the Corresponding
Uncertificated Interests pursuant to Section 4.10 and 4.02; second, to the
extent of the remainder of the Available Distribution Amount attributable to
principal in respect of Group 1 Loans, to REMIC I Regular Interest LT-1A; and
third, to the extent of the remainder of the Available Distribution Amount
attributable to principal in respect of Group 2 Loans, to REMIC I Regular
Interest LT-2A.

      (c) The portion of the Uncertificated REMIC I Regular Interest
Distribution Amounts described in Section 4.09(a) shall be deemed distributed by
REMIC I to REMIC II in accordance with the priority assigned to the REMIC III
Certificates relative to that assigned to the REMIC I Certificates under Section
4.02(b).

      (d) In determining from time to time the Uncertificated REMIC I Regular
Interest Distribution Amounts, Realized Losses allocated to the Uncertificated
REMIC II Regular Interests and REMIC II Certificates shall be allocated to the
Uncertificated REMIC I Regular Interests as follows: first, in an amount equal
to the aggregate Realized Losses allocated to REMIC II Regular Interest Y, REMIC
II Regular Interest Z, the REMIC II Group 1 IO Interests, the REMIC II Group 2
IO Interests and the Class R-2 Certificate pursuant to Sections 4.10 and 4.05,
to REMIC I Regular Interests LT-1P, LT-2P, the REMIC I Group 1 IO Interests, the
REMIC I Group 2 IO Interests and REMIC I Regular Interest LT-2R, in the same
amounts and priorities as allocated to the Corresponding Uncertificated
Interests; second, other Realized Losses attributable to Group 1 Loans to REMIC
I Regular Interest LT-1A; and third, other Realized Losses attributable to Group
2 Loans to REMIC I Regular Interest LT-2A

      (e) Notwithstanding the deemed distributions on the Uncertificated REMIC I
Regular

                                      -52-
<PAGE>

Interests described in this Section 4.09, distributions of funds from the
Certificate Account shall be made only in accordance with Section 4.02.

      Section 4.10 DISTRIBUTIONS ON THE UNCERTIFICATED REMIC II REGULAR
INTERESTS.

      (a) On each Distribution Date the Trustee shall be deemed to distribute to
itself, as the holder of the Uncertificated REMIC II Regular Interests, from
REMIC II, the following amounts in the following order of priority to the extent
of the Available Distribution Amount reduced by distributions made to the Class
R-1 Certificates and Class R-2 Certificates pursuant to Section 4.02(a):

         (i) Uncertificated REMIC II Accrued Interest on the Uncertificated
      REMIC II Regular Interests for such Distribution Date, plus any
      Uncertificated REMIC II Accrued Interest thereon remaining unpaid from any
      previous Distribution Date; and

         (ii) In accordance with the priorities set forth in Section 4.10(b), an
      amount equal to the sum of the amounts in respect of principal
      distributable on the REMIC III Certificates (other than the Class 1-A-16
      Certificates, Class 1-A-17 Certificates, Class 1-A-18 Certificates, Class
      1-A-19 Certificates, Class 2-A-5 Certificates, Class 2-A-11 Certificates,
      Class 1-A-V Certificates and Class 2-A-V Certificates) under Section
      4.02(a), as allocated thereto pursuant to Section 4.02(b).

      (b) The amount described in Section 4.10(a)(ii) shall be deemed
distributed first, to REMIC II Regular Interests MT-1Pool and MT-2Pool so as to
keep the Uncertificated Principal Balance of REMIC II Regular Interest MT-1Pool
equal to 1% of the Uncertificated Principal Balance of REMIC I Regular Interest
LT-1A and the Uncertificated Principal Balance of REMIC II Regular Interest MT-
2Pool equal to 1% of the aggregate Uncertificated Principal Balance of REMIC I
Regular Interests LT-2A and LT-2R; second, to REMIC II Regular Interests MT-1SUB
and MT-2SUB so that the Uncertificated Principal Balance of each such REMIC II
Regular Interest is equal to 0.01% of the excess of (x) the aggregate Stated
Principal Balance of the Group 1 Loans or Group 2 Loans, respectively, over (y)
the aggregate Certificate Principal Balance of the Group 1 Senior Certificates
or Group 2 Senior Certificates, respectively (except that if any such excess is
a larger number than in the preceding distribution period, the least amount of
principal shall be distributed to such REMIC II Regular Interests such that the
Subordinate Balance Ratio is maintained); third, an amount equal to the sum of
the amounts in respect of principal distributable on the Class 1-A-1
Certificate, Class 1-A-3 Certificate, Class 1-A-5 Certificate, Class 1-A-6
Certificate, Class 1-A-9 Certificate, Class 1-A-10 Certificate, Class 1-A-11
Certificate, Class 1-A-12 Certificate, Class 1-A-13 Certificate, Class 1-A-14
Certificate, Class 1-A-15 Certificate, Class 2-A-1 Certificate, Class 2-A-4
Certificate, Class 2-A-13 Certificate, Class 1-A-P Certificate and Class 2-A-P
Certificate under Section 4.02(a), as allocated thereto pursuant to Section
4.02(b), shall be distributed to REMIC II Regular Interest MT-1A1, REMIC II
Regular Interest MT-1A3, REMIC II Regular Interest MT-1A5, REMIC II Regular
Interest MT-1A6, REMIC II Regular Interest MT-1A9, REMIC II Regular Interest
MT-1A10, REMIC II Regular Interest MT-1A11, REMIC II Regular Interest MT-1A12,
REMIC II

                                      -53-
<PAGE>

Regular Interest MT-1A13, REMIC II Regular Interest MT-1A14, REMIC II Regular
Interest MT-1A15, REMIC II Regular Interest MT-2A1, REMIC II Regular Interest
MT-2A4, REMIC II Regular Interest MT-2A13, REMIC II Regular Interest Y, REMIC II
Regular Interest Z in the same amounts and priorities as distributed to the
Corresponding Certificated Interests; and fourth, any remaining principal to
REMIC II Regular Interest MT-X.

      (c) The portion of the Uncertificated REMIC II Regular Interest
Distribution Amounts described in Section 4.10(a) shall be deemed distributed by
REMIC II to REMIC III in accordance with the priority assigned to the REMIC III
Certificates relative to that assigned to the REMIC II Certificates under
Section 4.02(b).

      (d) In determining from time to time the Uncertificated REMIC II Regular
Interest Distribution Amounts, Realized Losses allocated to the REMIC III
Certificates (other than the Class A-V Certificates) and the Uncertificated
Class A-V Regular Interests shall be allocated to the Uncertificated REMIC I
Regular Interests as follows: first, to REMIC II Regular Interests MT-1Pool and
MT-2Pool so as to keep the Uncertificated Principal Balance of REMIC II Regular
Interest MT- 1Pool equal to 1% of the Uncertificated Principal Balance of REMIC
I Regular Interest LT-1A and the Uncertificated Principal Balance of REMIC II
Regular Interest MT-2Pool equal to 1% of the aggregate Uncertificated Principal
Balance of REMIC I Regular Interests LT-2A and LT-2R; second, to REMIC II
Regular Interests MT-1SUB and MT-2SUB so that the Uncertificated Principal
Balance of each such REMIC II Regular Interest is equal to 0.01% of the excess
of (x) the aggregate Stated Principal Balance of the Group 1 Loans and Group 2
Loans, respectively, over (y) the Certificate Principal Balance of the Group 1
Senior Certificates or Group 2 Senior Certificates, respectively (except that if
any such excess is a larger number than in the preceding distribution period,
the least amount of Realized Losses shall be applied to such REMIC II Regular
Interests such that the Subordinate Balance Ratio is maintained); third, an
amount of Realized Losses equal to the aggregate Realized Losses applied to the
Class 1-A-1 Certificate, Class 1-A-3 Certificate, Class 1-A- 5 Certificate,
Class 1-A-6 Certificate, Class 1-A-9 Certificate, Class 1-A-10 Certificate,
Class 1-A- 11 Certificate, Class 1-A-12 Certificate, Class 1-A-13 Certificate,
Class 1-A-14 Certificate, Class 1-A-15 Certificate, Class 2-A-1 Certificate,
Class 2-A-4 Certificate, Class 2-A-13 Certificate, Class 1-A-P Certificate,
Class 2-A-P Certificate, the Uncertificated Class 1-A-V REMIC Regular Interests
and the Uncertificated Class 2-A-V REMIC Regular Interests under Section 4.05
and 4.11(b) shall be applied to REMIC II Regular Interest MT-1A1, REMIC II
Regular Interest MT-1A3, REMIC II Regular Interest MT-1A5, REMIC II Regular
Interest MT-1A6, REMIC II Regular Interest MT-1A9, REMIC II Regular Interest
MT-1A10, REMIC II Regular Interest MT-1A11, REMIC II Regular Interest MT-1A12,
REMIC II Regular Interest MT-1A13, REMIC II Regular Interest MT-1A14, REMIC II
Regular Interest MT-1A15, REMIC II Regular Interest MT-2A1, REMIC II Regular
Interest MT-2A4, REMIC II Regular Interest MT-2A13, REMIC II Regular Interest Y,
REMIC II Regular Interest Z, the REMIC II Group 1 IO Interests and the REMIC II
Group 2 IO Interests in the same amounts and priorities as applied to the
Corresponding Certificated Interests; fourth, the remaining Realized Losses
shall be allocated to REMIC II Regular Interest MT-X.

      (e) On each Distribution Date, the Trustee shall be deemed to distribute
from REMIC III,

                                      -54-
<PAGE>

in the priority set forth in Sections 4.02(a) and (b), to the REMIC III
Certificates the amounts distributable thereon, from the Uncertificated REMIC II
Regular Interest Distribution Amounts deemed to have been received by REMIC III
from REMIC II under this Section 4.10.

      (f) Notwithstanding the deemed distributions on the Uncertificated REMIC
II Regular Interests described in this Section 4.10, distributions of funds from
the Certificate Account shall be made only in accordance with Section 4.02.

      Section 4.11         DISTRIBUTIONS ON THE UNCERTIFICATED CLASS A-V REMIC
                           REGULAR INTERESTS.

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

      (b) In determining from time to time the Uncertificated Class A-V REMIC
Regular Interest Distribution Amounts, Realized Losses allocated to the Class
A-V Certificates under Section 4.05 shall be deemed allocated to related
Uncertificated Class A-V REMIC Regular Interests on a pro rata basis based on
the related Uncertificated Class A-V REMIC Accrued Interest for the related
Distribution Date.

      (c) On each Distribution Date, the Trustee shall be deemed to distribute
from the Trust Fund, in the priority set forth in Sections 4.02(a), to the Class
A-V Certificates, the amounts distributable thereon from the related
Uncertificated Class A-V REMIC Regular Interest Distribution Amounts deemed to
have been received by the Trustee from the Trust Fund under this Section 4.11.
The amount deemed distributable hereunder with respect to the Class 1-A-V
Certificates shall equal 100% of the amounts payable with respect to the
Uncertificated Class 1-A-V REMIC Regular Interests. The amount deemed
distributable hereunder with respect to the Class 2-A-V Certificates shall equal
100% of the amounts payable with respect to the Uncertificated Class 2-A-V REMIC
Regular Interests.

      (d) Notwithstanding the deemed distributions on the Uncertificated Class
A-V REMIC Regular Interests described in this Section 4.11, distributions of
funds from the Certificate Account shall be made only in accordance with Section
4.02.

                                      -55-
<PAGE>

                                    ARTICLE V

                                THE CERTIFICATES

      Section 5.01.        THE CERTIFICATES. (SEE SECTION 5.01 OF THE STANDARD
                           TERMS)

      Section 5.02.        REGISTRATION OF TRANSFER AND EXCHANGE OF
                           CERTIFICATES.

         (a) - (e)(iii)(A). (See Section 5.02(a) - (e)(iii)(A) of the Standard
         Terms)

         (B) Any purported Certificate Owner whose acquisition or holding of any
         Class M Certificate (or interest therein) was effected in violation of
         the restrictions in this Section 5.02(e) shall indemnify and hold
         harmless the Company, the Trustee, the Master Servicer, any
         Subservicer, the Underwriter and the Trust Fund from and against any
         and all liabilities, claims, costs or expenses incurred by such parties
         as a result of such acquisition or holding.

         (f) - (h). (See Section 5.02(f) - (h) of the Standard Terms)

      Section 5.03.        MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES.
                           (SEE SECTION 5.03 OF THE STANDARD TERMS)

      Section 5.04.        PERSONS DEEMED OWNERS. (SEE SECTION 5.04 OF THE
                           STANDARD TERMS)

      Section 5.05.        APPOINTMENT OF PAYING AGENT. (SEE SECTION 5.05 OF THE
                           STANDARD TERMS)

                                      -56-
<PAGE>

                                   ARTICLE VI

                       THE COMPANY AND THE MASTER SERVICER
                     (SEE ARTICLE VI OF THE STANDARD TERMS)

                                      -57-
<PAGE>

                                   ARTICLE VII

                                     DEFAULT
                     (SEE ARTICLE VII OF THE STANDARD TERMS)

                                      -58-
<PAGE>

                                  ARTICLE VIII

                             CONCERNING THE TRUSTEE
                    (SEE ARTICLE VIII OF THE STANDARD TERMS)

                                      -59-
<PAGE>

                                   ARTICLE IX

                                   TERMINATION
                     (SEE ARTICLE IX OF THE STANDARD TERMS)

                                      -60-
<PAGE>

                                    ARTICLE X

                                REMIC PROVISIONS

      Section 10.01        REMIC ADMINISTRATION. (SEE SECTION 10.01 OF THE
                           STANDARD TERMS)

      Section 10.02        MASTER SERVICER; REMIC ADMINISTRATOR AND TRUSTEE
                           INDEMNIFICATION. (SEE SECTION 10.02 OF THE STANDARD
                           TERMS)

      Section 10.03        DESIGNATION OF REMIC(S).

      The REMIC Administrator will make elections to treat each of REMIC I and
REMIC II, and subject to this Agreement (including the Mortgage Loans but
excluding the Initial Monthly Payment Fund) as a REMIC for federal income tax
purposes.

      The Uncertificated REMIC I Regular Interests shall be designated as the
"regular interests" and the Class R-1 Certificates shall be designated as the
sole class of "residual interest" in REMIC I. The Class 1-A-1, Class 1-A-2,
Class 1-A-3, Class 1-A-4, Class 1-A-5, Class 1-A-6, Class 1-A-7, Class 1-A-8,
Class 1-A-9, Class 1-A-10, Class 1-A-11, Class 1-A-12, Class 1-A-13, Class
1-A-14, Class 1-A-15, Class 1-A-16, Class 1-A-17, Class 1-A-18, Class 1-A-19,
Class 1-A-20, Class 2-A-1, Class 2-A-2, Class 2-A-3, Class 2-A-4, Class 2-A-5,
Class 2-A-6, Class 2-A-7, Class 2-A-8, Class 2-A-9, Class 2-A-10, Class 2-A-11,
Class 2-A-12, Class 2-A-13, Class 1-A-P, Class 2-A-P, Class M-1, Class M-2,
Class M-3, Class B-1, Class B-2 and Class B-3 Certificates and the rights in and
to which will be represented by the related Class A-V Certificates, will be
"regular interests" in REMIC II, and the Class R-2 Certificates will be the sole
class of "residual interests" therein for purposes of the REMIC Provisions (as
defined in the Standard Terms) under federal income tax law. On and after the
date of issuance of any Subclass of Class A-V Certificates pursuant to Section
5.01(c) of the Standard Terms, any such Subclass will represent the related
Uncertificated Class A-V REMIC Regular Interest or Interests specified by the
initial Holder of the related Class A-V Certificates pursuant to said Section.

      Section 10.04        [RESERVED].

      Section 10.05        COMPLIANCE WITH WITHHOLDING REQUIREMENTS.

      Notwithstanding any other provision of this Agreement, the Trustee or any
Paying Agent, as applicable, shall comply with all federal withholding
requirements respecting payments to Certificateholders, including interest or
original interest discount payments or advances thereof that the Trustee or any
Paying Agent, as applicable, reasonably believes are applicable under the Code.
The consent of Certificateholders shall not be required for such withholding. In
the event the Trustee or any Paying Agent, as applicable, does withhold any
amount from interest or original issue discount payments or advances thereof to
any Certificateholder pursuant to federal withholding requirements, the Trustee
or any Paying Agent, as applicable, shall indicate the amount withheld to

                                      -61-
<PAGE>

such Certificateholder pursuant to the terms of such requirements.

                                      -62-
<PAGE>

                                   ARTICLE XI

                            MISCELLANEOUS PROVISIONS

      Section 11.01        AMENDMENT.  (SEE SECTION 11.01 OF THE STANDARD TERMS)

      Section 11.02        RECORDATION OF AGREEMENT. COUNTERPARTS. (SEE SECTION
                           11.02 OF THE STANDARD TERMS)

      Section 11.03        LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS. (SEE
                           SECTION 11.03 OF THE STANDARD TERMS)

      Section 11.04        GOVERNING LAWS. (SEE SECTION 11.04 OF THE STANDARD
                           TERMS)

      Section 11.05        NOTICES. All demands and notices hereunder shall be
                           in writing and shall be deemed to have been duly
                           given if personally delivered at or mailed by
                           registered mail, postage prepaid (except for notices
                           to the Trustee which shall be deemed to have been
                           duly given only when received), to the appropriate
                           address for each recipient listed in the table below
                           or, in each case, such other address as may hereafter
                           be furnished in writing to the Master Servicer, the
                           Trustee and the Company, as applicable:

<TABLE>
<CAPTION>
               RECIPIENT                            ADDRESS
<S>                                     <C>
Company                                 8400 Normandale Lake Boulevard
                                        Suite 250, Minneapolis, Minnesota  55437,
                                        Attention:  President

Master Servicer                         2255 N. Ontario Street, Suite 400
                                        Burbank, California 91504-2130,
                                        Attention:  Managing Director/Master Servicing

                                        Corporate Trust Office
                                        The Trustee designates its offices located at
Trustee                                 14 Wall Street, 8th Floor
                                        New York, New York 10005, for the purposes of Section 8.12
                                        of the Standard Terms

Fitch                                   One State Street Plaza
                                        New York, New York 10004

Standard & Poor's                       55 Water Street
                                        New York, New York 10041
</TABLE>

Any notice required or permitted to be mailed to a Certificateholder shall be
given by first class mail,

                                      -63-
<PAGE>

postage prepaid, at the address of such holder as shown in the Certificate
Register. Any notice so mailed within the time prescribed in this Agreement
shall be conclusively presumed to have been duly given, whether or not the
Certificateholder receives such notice.

         Section 11.06     REQUIRED NOTICES TO RATING AGENCY AND SUBSERVICER.
                           (SEE SECTION 11.06 OF THE STANDARD TERMS)

         Section 11.07     SEVERABILITY OF PROVISIONS. (SEE SECTION 11.07 OF THE
                           STANDARD TERMS)

         Section 11.08     SUPPLEMENTAL PROVISIONS FOR RESECURITIZATION. (SEE
                           SECTION 11.08 OF THE STANDARD TERMS)

         Section 11.09     ALLOCATION OF VOTING RIGHTS.

         91.5% of all voting rights will be allocated among all holders of the
certificates, other than the Interest Only Certificates and Residual
Certificates, in proportion to their then outstanding Certificate Principal
Balances, 1.0%, 1.0%, 1.0%, 1.0%, 1.0% and 1.0% of all voting rights will be
allocated among the each of the Holders of the Class 1-A-16, Class 1-A-17, Class
1-A-18, Class 1- A-18, Class 1-A-19, Class 2-A-5 and Class 2-A-11 Certificates,
0.5% and 0.5% of all voting rights will be allocated among the Holders of the
Class 1-A-V Certificates and Class 2-A-V Certificates, respectively, and 0.5%,
0.5% and 0.5% of all voting rights will be allocated among the Holders of the
Class R-1, Class R-2 and Class R-3 Certificates, respectively, in proportion to
their respective Percentage Interests.

                                      -64-
<PAGE>

                                   ARTICLE XII

                                   [RESERVED]

                                      -65-
<PAGE>

         IN WITNESS WHEREOF, the Company, the Master Servicer and the Trustee
have caused their names to be signed hereto by their respective officers
thereunto duly authorized and their respective seals, duly attested, to be
hereunto affixed, all as of the day and year first above written.

[Seal]                                       RESIDENTIAL FUNDING MORTGAGE
                                                      SECURITIES I, INC.

Attest:                                      By:_________________________
         Name:    Lisa Lundsten              Name:  Randy Van Zee
         Title:   Vice President             Title: Vice President

[Seal]
                                             RESIDENTIAL FUNDING CORPORATION

Attest:                                      By:__________________________
         Name:    Randy Van Zee              Name:    Lisa Lundsten
         Title:   Director                   Title:   Managing Director

[Seal]                                       BANK ONE, NATIONAL ASSOCIATION
                                                           as Trustee

Attest:
         Name:                               By:__________________________
         Title:                              Name:   Keith R. Richardson
                                             Title:  Vice President

<PAGE>

STATE OF MINNESOTA              )
                                ) ss.:
COUNTY OF HENNEPIN              )

                  On the 30th day of October, 2001 before me, a notary public in
and for said State, personally appeared Randy Van Zee, known to me to be a Vice
President of Residential Funding Mortgage Securities I, Inc., one of the
corporations that executed the within instrument, and also known to me to be the
person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.

                  IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.

                                                               Notary Public

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

[Notarial Seal]

<PAGE>

STATE OF MINNESOTA      )
                        ) ss.:
COUNTY OF HENNEPIN      )

                  On the 30th day of October, 2001 before me, a notary public in
and for said State, personally appeared Lisa Lundsten, known to me to be a
Managing Director of Residential Funding Corporation, one of the corporations
that executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.

                  IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.

                                                              Notary Public

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

[Notarial Seal]

<PAGE>

STATE OF ILLINOIS       )
                        ) ss.:
COUNTY OF COOK          )

                  On the 30th day of October, 2001 before me, a notary public in
and for said State, personally appeared Keith R. Richardson, known to me to be a
Vice President of Bank One, National Association, a national banking association
that executed the within instrument, and also known to me to be the person who
executed it on behalf of said banking corporation and acknowledged to me that
such banking corporation executed the within instrument.

                  IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.

                                                             Notary Public

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

[Notarial Seal]

<PAGE>

                                   EXHIBIT ONE
                     MORTGAGE LOAN SCHEDULE FOR LOAN GROUP 1

                            (Available Upon Request)

<PAGE>

                                   EXHIBIT TWO
                     MORTGAGE LOAN SCHEDULE FOR LOAN GROUP 2

                            (Available Upon Request)

<PAGE>

                                  EXHIBIT THREE
                         SCHEDULE OF DISCOUNT FRACTIONS

                            (Available Upon Request)

<PAGE>

                                  EXHIBIT FOUR

                          INFORMATION TO BE INCLUDED IN
                       MONTHLY DISTRIBUTION DATE STATEMENT

                  (i) (a) the amount of such distribution to the
         Certificateholders of such Class applied to reduce the Certificate
         Principal Balance thereof, and (b) the aggregate amount included
         therein representing Principal Prepayments;

                  (ii) the amount of such distribution to Holders of such Class
         of Certificates allocable to interest;

                  (iii) if the distribution to the Holders of such Class of
         Certificates is less than the full amount that would be distributable
         to such Holders if there were sufficient funds available therefor, the
         amount of the shortfall;

                  (iv) the amount of any Advance by the Master Servicer pursuant
         to Section 4.04;

                  (v) the number and Pool Stated Principal Balance of the
         Mortgage Loans after giving effect to the distribution of principal on
         such Distribution Date;

                  (vi) the aggregate Certificate Principal Balance of each Class
         of Certificates and each of the Group 1 Senior, Group 2 Senior, Class M
         and Class B Percentages, after giving effect to the amounts distributed
         on such Distribution Date, separately identifying any reduction thereof
         due to Realized Losses other than pursuant to an actual distribution of
         principal;

                  (vii) the related Subordinate Principal Distribution Amount
         and Prepayment Distribution Percentage, if applicable;

                  (viii) on the basis of the most recent reports furnished to it
         by Sub-Servicers, the number and aggregate principal balances of
         Mortgage Loans that are Delinquent (A) 30-59 days, (B) 60-89 days and
         (C) 90 or more days and the number and aggregate principal balance of
         Mortgage Loans that are in foreclosure;

                  (ix) the number, aggregate principal balance and book value of
         any REO Properties;

                  (x) the aggregate Accrued Certificate Interest remaining
         unpaid, if any, for each Class of Certificates, after giving effect to
         the distribution made on such Distribution Date;

                  (xi) the Special Hazard Amount, Fraud Loss Amount and
         Bankruptcy Amount as of the close of business on such Distribution Date
         and a description of any change in the

                                       -1-

<PAGE>

         calculation of such amounts;

                  (xii) the weighted average Pool Strip Rate for such
         Distribution Date and the Pass- Through Rate with respect to the Class
         A-V Certificates and each Subclass, if any, thereof;

                  (xiii)   [RESERVED];

                  (xiv) the Notional Amount with respect to each class of
         Interest Only Certificates and each Subclass Notional Amount;

                  (xv) the occurrence of the Credit Support Depletion Date;

                  (xvi) the related Senior Accelerated Distribution Percentage
         applicable to such distribution;

                  (xvii) the related Senior Percentage for such Distribution
         Date;

                  (xviii) the aggregate amount of Realized Losses for such
         Distribution Date;

                  (xix) the aggregate amount of any recoveries on previously
         foreclosed loans from Sellers due to a breach of representation or
         warranty assigned to the Trustee pursuant to Section 2.04;

                  (xx) the weighted average remaining term to maturity of the
         Mortgage Loans after giving effect to the amounts distributed on such
         Distribution Date; and

                  (xxi) the weighted average Mortgage Rates of the Mortgage
         Loans after giving effect to the amounts distributed on such
         Distribution Date.

In the case of information furnished pursuant to clauses (i) and (ii) above, the
amounts shall be expressed as a dollar amount per Certificate with a $1,000
denomination.

The Trustee's internet website will initially be located at
http://www.abs.bankone.com. To receive this statement via first class mail,
telephone the Trustee at (800) 524-9472.

                                       -2-

<PAGE>

                                  EXHIBIT FIVE

                     STANDARD TERMS OF POOLING AND SERVICING
                       AGREEMENT DATED AS OF JULY 1, 2001

                                       -1-

<PAGE>

                                   EXHIBIT SIX

                      AGGREGATE PLANNED PRINCIPAL BALANCES

                                    AGGREGATE                  AGGREGATE
                                PLANNED PRINCIPAL          PLANNED PRINCIPAL
                             BALANCES FOR CLASSES 1     BALANCES FOR CLASSES 2
                              A-1, 1-A-14 AND 1-A-15         A-1 AND 2-A-13
DISTRIBUTION DATE                  CERTIFICATES               CERTIFICATES

Initial Balance............      $120,121,000.00             $33,569,000.00
November 25, 2001..........       119,597,849.59              33,457,320.31
December 25, 2001..........       118,994,589.75              33,325,190.98
January 25, 2002...........       118,311,400.45              33,172,865.40
February 25, 2002..........       117,548,513.15              33,000,389.10
March 25, 2002.............       116,706,210.76              32,807,820.57
April 25, 2002.............       115,784,827.58              32,595,231.29
May 25, 2002...............       114,784,749.15              32,362,705.70
June 25, 2002..............       113,706,412.10              32,110,341.14
July 25, 2002..............       112,550,303.87              31,838,247.85
August 25, 2002 ...........       111,316,962.44              31,546,548.86
September 25, 2002.........       110,006,975.98              31,235,379.97
October 25, 2002...........       108,620,982.44              30,904,889.61
November 25, 2002..........       107,159,669.08              30,555,238.77
December 25, 2002..........       105,623,771.99              30,186,600.86
January 25, 2003...........       104,014,075.47              29,799,161.62
February 25, 2003..........       102,331,411.48              29,393,118.92
March 25, 2003.............       100,576,658.90              28,968,682.66
April 25, 2003.............        98,750,742.83              28,526,074.57
May 25, 2003...............        96,854,633.83              28,065,528.01
June 25, 2003..............        94,889,347.07              27,587,287.84
July 25, 2003..............       $92,855,941.49             $27,091,610.12
August 25, 2003 ...........        90,755,518.81              26,578,761.97
September 25, 2003.........        88,589,222.62              26,049,021.29
October 25, 2003...........        86,358,237.34              25,502,676.53
November 25, 2003..........        84,063,787.16              24,940,026.43
December 25, 2003..........        81,707,134.90              24,361,379.75
January 25, 2004...........        79,289,580.93              23,767,055.01
February 25, 2004..........        76,812,461.92              23,157,380.16
March 25, 2004.............        74,351,651.94              22,532,692.33
April 25, 2004.............        71,907,046.13              21,912,117.41
May 25, 2004...............        69,478,540.28              21,295,628.96
June 25, 2004..............        67,066,030.90              20,683,200.71
July 25, 2004..............        64,669,415.14              20,074,806.55
August 25, 2004 ...........        62,288,590.85              19,470,420.56
September 25, 2004.........        59,923,456.51              18,870,016.95
October 25, 2004...........        57,573,911.30              18,273,570.16
November 25, 2004..........        55,239,855.03              17,681,054.73
December 25, 2004..........        52,921,188.19              17,092,445.42
January 25, 2005...........        50,617,811.90              16,507,717.12
February 25, 2005..........        48,329,627.93              15,926,844.89

                                       -1-

<PAGE>

March 25, 2005.............        46,056,538.69              15,349,803.98
April 25, 2005.............        43,798,447.23              14,776,569.77
May 25, 2005...............        41,555,257.24              14,207,117.81
June 25, 2005..............        39,326,873.03              13,641,423.82
July 25, 2005..............        37,113,199.52              13,079,463.65
August 25, 2005 ...........        34,914,142.29              12,521,213.35
September 25, 2005.........        32,729,607.51              11,966,649.09
October 25, 2005...........        30,559,501.96              11,415,747.21
November 25, 2005..........        28,403,733.04              10,868,484.22
December 25, 2005..........        26,262,208.76              10,324,836.75
January 25, 2006...........        24,134,837.71               9,784,781.60
February 25, 2006..........        22,021,529.10               9,248,295.74
March 25, 2006.............        19,922,192.72               8,715,356.25
April 25, 2006.............        17,836,738.95               8,185,940.40
May 25, 2006...............        15,765,078.78               7,660,025.59
June 25, 2006..............        13,707,123.74               7,137,589.35
July 25, 2006..............        11,662,785.97               6,618,609.40
August 25, 2006............         9,631,978.18               6,103,063.57
September 25, 2006.........         7,614,613.64               5,590,929.85
October 25, 2006...........         5,610,606.20               5,082,186.36
November 25, 2006..........         3,727,412.37               4,603,952.58
December 25, 2006..........         1,857,213.22               4,129,017.34
January 25, 2007...........                 0.00               3,657,359.31
February 25, 2007..........                 0.00               3,188,957.27
March 25, 2007.............                 0.00               2,723,790.15
April 25, 2007.............                 0.00               2,261,837.04
May 25, 2007...............                 0.00               1,803,077.14
June 25, 2007..............                 0.00               1,347,489.80
July 25, 2007..............                 0.00                 895,054.49
August 25, 2007............                 0.00                 445,750.85
September 25, 2007 and
thereafter.................                 0.00                       0.00

                                       -2-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00031-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00031-of-00352.parquet"}]]