Document:

Unassociated Document

    

      EXECUTION

      

      

      

      

      

      SAXON
        ASSET SECURITIES COMPANY,

       

      Depositor
        

       

       

      SAXON
        MORTGAGE SERVICES, INC.,

       

      Servicer

       

       

      and

       

       

      DEUTSCHE
        BANK NATIONAL TRUST COMPANY

       

      Trustee

       

      _____________________________________________________

       

      POOLING
        AND SERVICING AGREEMENT

       

      Dated
        as
        of February 1, 2007

       

      _____________________________________________________

       

      SAXON
        ASSET SECURITIES TRUST 2007-1

       

       

      MORTGAGE
        LOAN ASSET BACKED CERTIFICATES, SERIES 2007-1

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      TABLE
        OF CONTENTS

       

      Page

      

        
          	
                  ARTICLE
                    1 DEFINITIONS

                	
                  6

                
	 	 	 
	
                  Section
                    1.1

                	
                  Defined
                    Terms

                	
                  6

                
	 	 
	
                  ARTICLE
                    2 CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND
                    WARRANTIES

                	
                  40

                
	 	 	 
	
                  Section
                    2.1

                	
                  Conveyance
                    of Mortgage Loans.

                	
                  40

                
	
                  Section
                    2.2

                	
                  Acceptance
                    by Trustee of the Mortgage Loans.

                	
                  44

                
	
                  Section
                    2.3

                	
                  Representations,
                    Warranties and Covenants of the Depositor and the
                    Servicer.

                	
                  46

                
	
                  Section
                    2.4

                	
                  Delivery
                    of Opinion of Counsel in Connection with Substitutions.

                	
                  50

                
	
                  Section
                    2.5

                	
                  Execution
                    and Delivery of Certificates.

                	
                  50

                
	 	 
	
                  ARTICLE
                    3 ADMINISTRATION AND SERVICING OF MORTGAGE LOANS

                	
                  51

                
	 	 	 
	
                  Section
                    3.1

                	
                  Servicer
                    to Service Mortgage Loans.

                	
                  51

                
	
                  Section
                    3.2

                	
                  Subservicing;
                    Enforcement of the Obligations of Servicers.

                	
                  52

                
	
                  Section
                    3.3

                	
                  Rights
                    of the Trustee in Respect of the Servicer.

                	
                  53

                
	
                  Section
                    3.4

                	
                  Trustee
                    to Act as Servicer.

                	
                  53

                
	
                  Section
                    3.5

                	
                  Collection
                    of Mortgage Loan Payments; Collection Account; Distribution
                    Account.

                	
                  53

                
	
                  Section
                    3.6

                	
                  Collection
                    of Taxes, Assessments and Similar Items; Escrow Accounts.

                	
                  56

                
	
                  Section
                    3.7

                	
                  Access
                    to Certain Documentation and Information Regarding the Mortgage
                    Loans.

                	
                  56

                
	
                  Section
                    3.8

                	
                  Permitted
                    Withdrawals from the Collection Account and Distribution
                    Account.

                	
                  57

                
	
                  Section
                    3.9

                	
                  Maintenance
                    of Hazard Insurance; Maintenance of Primary Insurance
                    Policies.

                	
                  58

                
	
                  Section
                    3.10

                	
                  Enforcement
                    of Due-on-Sale Clauses; Assumption Agreements.

                	
                  60

                
	
                  Section
                    3.11

                	
                  Realization
                    Upon Defaulted Mortgage Loans; Repurchase of Certain Mortgage
                    Loans.

                	
                  61

                
	
                  Section
                    3.12

                	
                  Trustee
                    to Cooperate; Release of Mortgage Files.

                	
                  64

                
	
                  Section
                    3.13

                	
                  Documents
                    Records and Funds in Possession of Servicer to be Held for the
                    Trustee.

                	
                  65

                
	
                  Section
                    3.14

                	
                  Servicing
                    Compensation.

                	
                  66

                
	
                  Section
                    3.15

                	
                  Access
                    to Certain Documentation.

                	
                  66

                
	
                  Section
                    3.16

                	
                  Annual
                    Statement as to Compliance.

                	
                  66

                
	
                  Section
                    3.17

                	
                  Annual
                    Independent Public Accountants’ Servicing Statement.

                	
                  67

                
	
                  Section
                    3.18

                	
                  Errors
                    and Omissions Insurance; Fidelity Bonds.

                	
                  67

                
	
                  Section
                    3.19

                	
                  Advances.

                	
                  67

                
	
                  Section
                    3.20

                	
                  Advance
                    Facility.

                	
                  68

                
	
                  Section
                    3.21

                	
                  Prepayment
                    Penalties.

                	
                  69

                
	 	 

        

         

        
          
            
            

          

          
            i

            
              

            

          

          
            
            

          

        

         

        
          	
                  ARTICLE
                    4 DISTRIBUTIONS

                	
                  69

                
	 	 	 
	
                  Section
                    4.1

                	
                  Priorities
                    of Distribution.

                	
                  69

                
	
                  Section
                    4.2

                	
                  Method
                    of Distribution.

                	
                  74

                
	
                  Section
                    4.3

                	
                  Allocation
                    of Losses.

                	
                  75

                
	
                  Section
                    4.4

                	
                  Reports
                    to the Depositor and the Trustee.

                	
                  76

                
	
                  Section
                    4.5

                	
                  Reports
                    by or on Behalf of the Servicer.

                	
                  76

                
	
                  Section
                    4.6

                	
                  The
                    Calculation Agent.

                	
                  78

                
	
                  Section
                    4.7

                	
                  The
                    Excess Reserve Fund Account.

                	
                  79

                
	
                  Section
                    4.8

                	
                  The
                    Supplemental Interest Trust.

                	
                  79

                
	 	 
	
                  ARTICLE
                    5 THE CERTIFICATES

                	
                  82

                
	 	 	 
	
                  Section
                    5.1

                	
                  The
                    Certificates.

                	
                  82

                
	
                  Section
                    5.2

                	
                  Certificate
                    Register; Registration of Transfer and Exchange of
                    Certificates.

                	
                  83

                
	
                  Section
                    5.3

                	
                  Mutilated,
                    Destroyed, Lost or Stolen Certificates.

                	
                  88

                
	
                  Section
                    5.4

                	
                  Persons
                    Deemed Owners.

                	
                  88

                
	
                  Section
                    5.5

                	
                  Access
                    to List of Certificateholders’ Names and Addresses.

                	
                  88

                
	
                  Section
                    5.6

                	
                  Maintenance
                    of Office or Agency.

                	
                  88

                
	 	 
	
                  ARTICLE
                    6 THE DEPOSITOR AND THE SERVICER

                	
                  89

                
	 	 	 
	
                  Section
                    6.1

                	
                  Respective
                    Liabilities of the Depositor and the Servicer.

                	
                  89

                
	
                  Section
                    6.2

                	
                  Merger
                    or Consolidation of the Depositor and Servicer.

                	
                  89

                
	
                  Section
                    6.3

                	
                  Limitation
                    on Liability of the Depositor, the Servicer and Others.

                	
                  89

                
	
                  Section
                    6.4

                	
                  Limitation
                    on Resignation of Servicer.

                	
                  90

                
	
                  Section
                    6.5

                	
                  Annual
                    Statement as to Compliance.

                	
                  90

                
	
                  Section
                    6.6

                	
                  Annual
                    Independent Public Accountants’ Servicing Statement.

                	
                  91

                
	 	 
	
                  ARTICLE
                    7 SERVICER DEFAULT

                	
                  91

                
	 	 	 
	
                  Section
                    7.1

                	
                  Events
                    of Default.

                	
                  91

                
	
                  Section
                    7.2

                	
                  Notification
                    to Certificateholders.

                	
                  93

                
	 	 
	
                  ARTICLE
                    8 CONCERNING THE TRUSTEE

                	
                  93

                
	 	 	 
	
                  Section
                    8.1

                	
                  Duties
                    of Trustee.

                	
                  93

                
	
                  Section
                    8.2

                	
                  Certain
                    Matters Affecting the Trustee.

                	
                  95

                
	
                  Section
                    8.3

                	
                  Trustee
                    Not Liable for Certificates or Mortgage Loans.

                	
                  96

                
	
                  Section
                    8.4

                	
                  Trustee
                    May Own Certificates.

                	
                  97

                
	
                  Section
                    8.5

                	
                  Trustee’s
                    Fees and Expenses.

                	
                  97

                
	
                  Section
                    8.6

                	
                  Eligibility
                    Requirements for Trustee.

                	
                  97

                
	
                  Section
                    8.7

                	
                  Resignation
                    and Removal of Trustee.

                	
                  98

                
	
                  Section
                    8.8

                	
                  Successor
                    Trustee.

                	
                  99

                
	
                  Section
                    8.9

                	
                  Merger
                    or Consolidation of Trustee.

                	
                  99

                
	
                  Section
                    8.10

                	
                  Appointment
                    of Co-Trustee or Separate Trustee.

                	
                  99

                
	
                  Section
                    8.11

                	
                  Tax
                    Matters.

                	
                  101

                
	
                  Section
                    8.12

                	
                  Trustee
                    Exchange Act Reporting Requirements.

                	
                  102

                
	
                  Section
                    8.13

                	
                  Reports
                    filed with the Securities and Exchange Commission.

                	
                  103

                
	 	 

        

         

        
          
            
            

          

          
            ii

            
              

            

          

          
            
            

          

        

         

        
          	
                  ARTICLE
                    9 TERMINATION

                	
                  106

                
	 	 	 
	
                  Section
                    9.1

                	
                  Termination
                    upon Liquidation or Purchase of all Mortgage Loans.

                	
                  106

                
	
                  Section
                    9.2

                	
                  Final
                    Distribution on the Certificates.

                	
                  107

                
	
                  Section
                    9.3

                	
                  Additional
                    Termination Requirements.

                	
                  108

                
	 	 
	
                  ARTICLE
                    10 [RESERVED]

                	
                  109

                
	 	 
	
                  ARTICLE
                    11 MISCELLANEOUS PROVISIONS

                	
                  109

                
	 	 	 
	
                  Section
                    11.1

                	
                  Amendment.

                	
                  109

                
	
                  Section
                    11.2

                	
                  Recordation
                    of Agreement; Counterparts.

                	
                  111

                
	
                  Section
                    11.3

                	
                  Governing
                    Law.

                	
                  111

                
	
                  Section
                    11.4

                	
                  Intention
                    of Parties.

                	
                  111

                
	
                  Section
                    11.5

                	
                  Notices.

                	
                  112

                
	
                  Section
                    11.6

                	
                  Severability
                    of Provisions.

                	
                  113

                
	
                  Section
                    11.7

                	
                  Assignment.

                	
                  113

                
	
                  Section
                    11.8

                	
                  Limitation
                    on Rights of Certificateholders.

                	
                  113

                
	
                  Section
                    11.9

                	
                  Inspection
                    and Audit Rights.

                	
                  114

                
	
                  Section
                    11.10

                	
                  Certificates
                    Nonassessable and Fully Paid.

                	
                  114

                
	
                  Section
                    11.11

                	
                  Limitations
                    on Actions; No Proceedings.

                	
                  114

                
	
                  Section
                    11.12

                	
                  Mortgage
                    Data.

                	
                  115

                
	
                  Section
                    11.13

                	
                  Third
                    Party Beneficiary

                	
                  115

                
	
                  Section
                    11.14

                	
                  Replacement
                    of Swap Counterparty

                	
                  115

                

        

      

       

      
        
          
          

        

        
          iii

          
            

          

        

        
          
          

        

      

       

      
        	
                SCHEDULES

              
	 
	
                Schedule
                  I:

              	
                Mortgage
                  Loan Schedule (By Group)

              	
                S-I-1

              
	
                Schedule
                  IA:

              	
                [Reserved]

              	
                S-IA-1

              
	
                Schedule
                  IB:

              	
                [Reserved]

              	
                S-IB-1

              
	
                Schedule
                  II:

              	
                Pass-Through
                  Rate Schedule

              	
                S-II-1

              
	
                Schedule
                  III:

              	
                REMIC
                  Structure

              	
                S-III-1

              
	 	 	 
	
                EXHIBITS

              
	 
	
                Exhibit
                  A:

              	
                Form
                  of Senior Certificates

              	
                A-1

              
	
                Exhibit
                  B:

              	
                Form
                  of Subordinate Certificates

              	
                B-1

              
	
                Exhibit
                  C:

              	
                Form
                  of Initial Certification of Trustee

              	
                C-1

              
	
                Exhibit
                  D:

              	
                Form
                  of Final Certification of Trustee

              	
                D-1

              
	
                Exhibit
                  E:

              	
                U.S.
                  Person Affidavit

              	
                E-1

              
	
                Exhibit
                  F:

              	
                Form
                  of Transferor Certificate

              	
                F-1

              
	
                Exhibit
                  G-1:

              	
                Form
                  of Investment Letter (Non-Rule 144A)

              	
                G-1-1

              
	
                Exhibit
                  G-2:

              	
                Benefit
                  Plan Affidavit

              	
                G-2-1

              
	
                Exhibit
                  H:

              	
                Form
                  of Rule 144A Letter - QIB Certification

              	
                H-1

              
	
                Exhibit
                  I:

              	
                Request
                  for Release of Documents and Receipt

              	
                I-1

              
	
                Exhibit
                  J:

              	
                [Reserved]

              	
                J-1

              
	
                Exhibit
                  K:

              	
                Form
                  of Remittance Agency Agreement

              	
                K-1

              
	
                Exhibit
                  L:

              	
                Form
                  of Security Release Certification

              	
                L-1

              
	
                Exhibit
                  M-1:

              	
                [Reserved]

              	
                M-1-1

              
	
                Exhibit
                  M-2:

              	
                [Reserved]

              	
                M-2-1

              
	
                Exhibit
                  N:

              	
                [Reserved]

              	
                N-1

              
	
                Exhibit
                  O:

              	
                Form
                  of Certification to be Provided to the Depositor by the
                  Trustee

              	
                O-1

              
	
                Exhibit
                  P:

              	
                Form
                  of Certification to be Provided to the Depositor by the
                  Servicer

              	
                P-1

              
	
                Exhibit
                  Q:

              	
                Interest
                  Rate Swap Agreement

              	
                Q-1

              
	
                Exhibit
                  R:

              	
                Interest
                  Rate Cap Agreement

              	
                R-1

              
	
                Exhibit
                  S:

              	
                Form
                  10-D, Form 8-K and Form 10-K Reporting Responsibility

              	
                S-1

              
	
                Exhibit
                  T:

              	
                Servicing
                  Criteria to be Addressed in Trustee Assessment of Compliance
                  

              	
                T-1

              

      

      

      

      

      

      
        
          
          

        

        
          iv

          
            

          

        

        
          
          

        

      

      THIS
        POOLING AND SERVICING AGREEMENT, dated as of February 1, 2007 (this “Agreement”)
        among SAXON ASSET SECURITIES COMPANY, a Virginia corporation, as depositor
        (the
“Depositor”), SAXON MORTGAGE SERVICES, INC., a Texas corporation, as servicer
        (the “Servicer”), and DEUTSCHE BANK NATIONAL TRUST COMPANY, a national banking
        association, as trustee (the “Trustee”),

      

      WITNESSETH
        THAT

      

      In
        consideration of the mutual agreements herein contained, the parties hereto
        agree as follows:

      

      PRELIMINARY
        STATEMENT

      

      The
        Depositor is the owner of the assets that are hereby conveyed to the Trustee
        in
        return for the Certificates. For federal income tax purposes, the Trust Fund
        shall comprise multiple REMICs organized in a tiered REMIC structure in the
        manner set forth in Schedule III hereto. The Certificates will represent
        the
        entire beneficial ownership interest in the Trust Fund. 

      

      This
        Preliminary Statement includes definitions of principal terms of the
        Certificates. In addition, the following table sets forth the initial Class
        Principal Balances of the Certificates and the minimum denominations (or
        Percentage Interests) and integral multiples in excess thereof in which such
        Classes shall be issuable (except that one Certificate of each Class of
        Certificates may be issued in a different amount):

      

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

      

      
        	
                 

                Class
                  Designation

              	
                Initial
                  Class

                Principal
                  Balance

              	
                Minimum
                  Percentage 

                Interest/Denomination

              	
                Integral
                  Multiples 

                in
                  Excess
                  Minimum

              
	
                Class
                  A-1

              	
                $209,071,000

              	
                $
                  25,000

              	
                $1,000

              
	
                Class
                  A-2a

              	
                $139,970,000

              	
                25,000

              	
                1,000

              
	
                Class
                  A-2b

              	
                $  35,830,000

              	
                25,000

              	
                1,000

              
	
                Class
                  A-2c

              	
                $  54,750,000

              	
                25,000

              	
                1,000

              
	
                Class
                  A-2d

              	
                $  27,629,000

              	
                25,000

              	
                1,000

              
	
                Class
                  M-1

              	
                $  25,820,000

              	
                100,000

              	
                1,000

              
	
                Class
                  M-2

              	
                $  26,442,000

              	
                100,000

              	
                1,000

              
	
                Class
                  M-3

              	
                $  13,688,000

              	
                100,000

              	
                1,000

              
	
                Class
                  M-4

              	
                $  12,132,000

              	
                100,000

              	
                1,000

              
	
                Class
                  M-5

              	
                $  11,510,000

              	
                100,000

              	
                1,000

              
	
                Class
                  M-6

              	
                $  10,266,000

              	
                100,000

              	
                1,000

              
	
                Class
                  B-1

              	
                $    9,644,000

              	
                100,000

              	
                1,000

              
	
                Class
                  B-2

              	
                $    8,399,000

              	
                100,000

              	
                1,000

              
	
                Class
                  B-3

              	
                $    7,777,000

              	
                100,000

              	
                1,000

              
	
                Class
                  OC

              	
                $  29,243,726

              	
                100%

              	
                N/A

              
	
                Class
                  P

              	
                $           1,000

              	
                100%

              	
                N/A

              
	
                Class
                  R

              	
                N/A

              	
                100%

              	
                N/A

              

      

       

      For
        purposes of this Agreement (and construction of the applicable terms and
        provisions hereof), the Class A-1 Certificates “relate” to Group 1; the Class
        A-2a, Class A-2b, Class A-2c, Class A-2d “relate” to Group 2, Class M and Class
        B Certificates “relate” to Group 1 and Group 2.

      

      ARTICLE
        1

      

      DEFINITIONS

      

      
        	 	
                Section
                  1.1

              	
                Defined
                  Terms

              

      

      

      Whenever
        used in this Agreement, in addition to any capitalized terms defined in the
        Preliminary Statement, the following words and phrases, unless the context
        otherwise requires, shall have the following meanings:

      

      Accepted
        Servicing Practices:
        With
        respect to any Mortgage Loan, those mortgage servicing practices set forth
        in
        Section 3.1 of this Agreement.

      

      Account
        Designation:
        Saxon
        Asset Securities Trust 2007-1 Mortgage Loan Asset Backed Certificates, Series
        2007-1.

      

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      Advance:
        Each
        P&I Advance and Servicing Advance.

      

      Adverse
        REMIC Event:
        Either
        (i) loss of status as a REMIC, within the meaning of Section 860D of the
        Code,
        for any group of assets identified as a REMIC in Schedule III of this Agreement,
        or (ii) imposition of any tax, including the tax imposed under Section
        860F(a)(1) on prohibited transactions, and the tax imposed under Section
        860G(d)
        on certain contributions to a REMIC, on any REMIC created
        hereunder.

      

      Aggregate
        Net WAC Cap
        With
        respect to the Offered Certificates and any Distribution Date, a per annum
        rate
        equal to the product of (i) the excess, if any, of (a) the weighted average
        of
        the Net Mortgage Rates of the Mortgage Loans, weighted based on their relative
        Stated Principal Balances as of the first day of the related Due Period,
        adjusted to reflect prepayments received after the first Day of the related
        Due
        Period that were distributed on the immediately preceding Distribution Date,
        over (b) the Swap Payment Rate for such Distribution Date, multiplied by
        (ii)
        the quotient of 30 divided by the actual number of days in the Interest Accrual
        Period.

      

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

      

      Available
        Distribution Amount:
        With
        respect to any Distribution Date, the sum of the following amounts:

      

      (1) the
        total
        amount of all cash received by or on behalf of the Servicer with respect
        to the
        Mortgage Loans serviced by it and received by the Trustee by the related
        Servicer Remittance Date and not previously distributed (including Liquidation
        Proceeds, condemnation proceeds and Insurance Proceeds), except:

      

      (a) all
        scheduled payments of principal and related interest collected on the Mortgage
        Loans but due on a date after the related Due Date;

      

      (b) all
        partial Principal Prepayments received with respect to the Mortgage Loans
        after
        the related Prepayment Period, together with all related interest accrued
        on
        such Mortgage Loans;

      

      (c) all
        Prepayment Penalties received in connection with the Mortgage
        Loans;

      

      (d) all
        Principal Prepayments in full received with respect to the Mortgage Loans
        after
        the related Prepayment Period, together with all related interest accrued
        on
        such Mortgage Loans;

      

      (e) Liquidation
        Proceeds, condemnation proceeds, Insurance Proceeds and Subsequent Recoveries
        received on such Mortgage Loans after the previous calendar month;

      

      (d) all
        amounts reimbursable to the Servicer pursuant to the terms of this Agreement
        or
        to the Trustee and/or the Custodian pursuant to the terms of this Agreement
        or
        the Custodial Agreement, in each case with respect to the Mortgage Loans
        or
        otherwise allocable to the Certificates;

      

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

      (e) reinvestment
        income on the balance of funds, if any, in the Collection Account or the
        Distribution Account; and

      

      (f) amounts
        as to which the Servicer is entitled to reimbursement from the Collection
        Account pursuant to this Agreement (including Servicing Fees), and as to
        which
        the Trustee and/or the Custodian, as applicable, are entitled with respect
        to
        the Mortgage Loans or otherwise allocable to the Certificates to be reimbursed
        from the Distribution Account or otherwise pursuant to this Agreement or
        the
        Custodial Agreement, as applicable (including the Trustee Fee);

      

      (2) all
        Advances on the Mortgage Loans made by the Servicer (or any successor servicer)
        for that Distribution Date;

      

      (3) any
        amounts paid as Compensating Interest with respect to the Mortgage Loans
        by the
        Servicer for that Distribution Date; 

      

      (4)
         the
        total
        amount of any cash deposited in the Distribution Account in connection with
        the
        repurchase of any Mortgage Loans by the Depositor pursuant to this Agreement
        and
        the Seller pursuant to the Sales Agreement; and

      

      (5) all
        Subsequent Recoveries received with respect to the Mortgage Loans during
        the
        related Prepayment Period.

      

      Basic
        Principal Distribution Amount:
        With
        respect to the Offered Certificates and any Distribution Date, the
        excess of
        the
        Principal Remittance Amount over
        the
        Excess Subordinate Amount.

      

      Basis
        Risk Carry Forward Amount:
        With
        respect to the Group 1 Senior Certificates, the Group 1 Senior Basis Risk
        Carry
        Forward Amount, with respect to the Group 2 Senior Certificates, the Group
        2
        Senior Basis Risk Carry Forward Amount, and with respect to the Subordinate
        Certificates, the Subordinate Basis Risk Carry Forward Amount.

      

      Basis
        Risk Payment:
        For any
        Distribution Date, the aggregate of the Basis Risk Carry Forward Amounts,
        for
        that date. With respect to any Distribution Date, the Basis Risk Payment
        cannot
        exceed the sum of (i) the amount otherwise distributable on the Class OC
        Certificates (other than amounts received by the holder of the Class OC
        Certificates in respect of Interest Rate Cap Payments and Net Swap Receipts),
        (ii) Interest Rate Cap Payments and (iii) amounts payable from Net Swap
        Receipts.

      

      Bankruptcy
        Code:
        The
        United States Bankruptcy Reform Act of 1978, as amended.

      

      Blanket
        Mortgage:
        The
        mortgage or mortgages encumbering a Cooperative Property.

      

      Book-Entry
        Certificates:
        All
        Classes of Certificates other than the Physical Certificates.

      

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

      Business
        Day:
        Any day
        other than (i) a Saturday or a Sunday, or (ii) a day on which banking
        institutions in New York City or the city in which any of the Custodian,
        the
        Servicer, or the Corporate Trust Office of the Trustee is located are authorized
        or obligated by law or executive order to be closed.

      

      Calculation
        Agent:
        Deutsche Bank National Trust Company, a national banking association, and
        its
        successors and assigns in such capacity under this Pooling and Servicing
        Agreement.

      

      Cap
        Agreement:
        The
        interest rate cap agreement documented pursuant to the 1992 ISDA Master
        Agreement, together with a schedule credit support annex and confirmation
        entered into with Morgan Stanley Capital Services Inc., attached hereto as
        Exhibit R.

      

      Cap
        Counterparty:
        Morgan
        Stanley Capital Services Inc.

      

      Certificate:
        Any one
        of the Certificates executed by the Trustee in substantially the forms attached
        hereto as exhibits.

      

      Certificate
        Owner:
        With
        respect to a Book-Entry Certificate, the Person who is the beneficial owner
        of
        such Book-Entry Certificate.

      

      Certificate
        Principal Balance:
        With
        respect to any Certificate other than the Class P Certificate and as of any
        Distribution Date, the Certificate Principal Balance on the date of the initial
        issuance of such Certificate as set forth on the face thereof, as reduced
        by:

      

      
        	 	
                (i)

              	
                all
                  amounts distributed on previous Distribution Dates on such Certificate
                  in
                  reduction of the Certificate Principal Balance thereof;
                  and

              

      

      

      
        	 	
                (ii)

              	
                with
                  respect to the Subordinate Certificates only, the amount of Realized
                  Losses on the Mortgage Loans allocated to such
                  Certificate;

              

      

      

      provided,
        however, that the Certificate Principal Balance of each Subordinate Certificate
        to which Realized Losses have been allocated will be increased, sequentially
        in
        the order of payment priority, by the amount of Subsequent Recoveries on
        the
        Mortgage Loans distributed as principal to any Certificate, but not by more
        than
        the amount of Realized Losses previously allocated to reduce the Certificate
        Principal Balance of such Certificate.

      

      Any
        amounts distributed to a Class of Subordinate Certificates in respect of
        any
        Unpaid Realized Loss Amount will not further reduce the Certificate Principal
        Balance of that Class.

      

      Certificate
        Register:
        The
        register maintained pursuant to Section 5.2 hereof.

      

      Certificateholder
        or Holder:
        The
        person in whose name a Certificate is registered in the Certificate Register,
        except that, solely for the purpose of giving any consent pursuant to this
        Agreement, any Certificate registered in the name of the Depositor or any
        affiliate of the Depositor shall be deemed not to be Outstanding and the
        Percentage Interest evidenced thereby shall not be taken into account in
        determining whether the requisite amount of Percentage Interests necessary
        to
        effect such consent has been obtained; provided, however, that if any such
        Person (including the Depositor) owns 100% of the Percentage Interests evidenced
        by a Class of Certificates, such Certificates shall be deemed to be Outstanding
        for purposes of any provision hereof that requires the consent of the Holders
        of
        Certificates of a particular Class as a condition to the taking of any action
        hereunder. The Trustee is entitled to rely conclusively on a certification
        of
        the Depositor or any affiliate of the Depositor in determining which
        Certificates are registered in the name of an affiliate of the
        Depositor.

      

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

      Class:
        All
        Certificates bearing the same class designation as set forth in the Preliminary
        Statement.

      

      Class
        A Certificates:
        All
        Certificates which include an “A” in their class designation.

      

      Class
        A Principal Allocation Percentage:
        With
        respect to each of the Group 1 Senior Certificates and the Group 2 Senior
        Certificates and any Distribution Date, the percentage equivalent of a fraction,
        determined as follows: (i) in the case of the Group 1 Senior Certificates
        the
        numerator of which is (x) the portion of the Principal Remittance Amount
        for
        such Distribution Date that is attributable to principal received or advanced
        on
        the Group 1 Mortgage Loans, and the denominator of which is (y) the Principal
        Remittance Amount for such Distribution Date and (ii) in the case of the
        Group 2
        Senior Certificates the numerator of which is (x) the portion of the Principal
        Remittance Amount for such Distribution Date that is attributable to principal
        received or advanced on the Group 2 Mortgage Loans, and the denominator of
        which
        is (y) the Principal Remittance Amount for such Distribution Date.

      

      Class
        B Certificates:
        All
        Certificates which include a “B” in their class designation.

      

      Class
        B-1 Principal Distribution Amount:
        with
        respect to the Class B-1 Certificates and any Distribution Date (i) prior
        to the
        Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
        for the Offered Certificates for that Distribution Date, the Principal
        Distribution Amount for that Distribution Date remaining after distribution
        of
        the Senior Principal Distribution Amount, the Class M-1 Principal Distribution
        Amount, the Class M-2 Principal Distribution Amount, the Class M-3 Principal
        Distribution Amount, the Class M-4 Principal Distribution Amount, the Class
        M-5
        Principal Distribution Amount and the Class M-6 Principal Distribution Amount
        or
        (ii) on or after the Stepdown Date if a Trigger Event is not in effect for
        the
        Offered Certificates for that Distribution Date, the lesser of:

      

      
        	 	
                (i)
                  

              	
                the
                  Principal Distribution Amount for that Distribution Date remaining
                  after
                  distribution of the Senior Principal Distribution Amount, the Class
                  M-1
                  Principal Distribution Amount, the Class M-2 Principal Distribution
                  Amount, the Class M-3 Principal Distribution Amount, the Class
                  M-4
                  Principal Distribution Amount, the Class M-5 Principal Distribution
                  Amount
                  and the Class M-6 Principal Distribution Amount; and
                  

              

      

      

      
        	 	
                (ii)
                  

              	
                the
                  excess (if any) of (A) the sum of (1) the Class Principal Balance
                  of the
                  Class B-1 Certificates immediately prior to that Distribution Date
                  and (2)
                  the aggregate Class Principal Balance of the Senior Certificates
                  and the
                  Class M Certificates (after taking into account the payment of
                  the Senior,
                  Class M-1, Class M-2, Class M-3, Class M-4, Class M-5 and Class
                  M-6
                  Principal Distribution Amounts for such Distribution Date) over
                  (B) the
                  lesser of (i) the aggregate Stated Principal Balance of the Mortgage
                  Loans
                  as of the last day of the related Due Period multiplied by approximately
                  85.40% and (ii) the amount, if any, by which (x) the aggregate
                  Stated
                  Principal Balance of the Mortgage Loans as of the last day of the
                  related
                  Due Period exceeds (y) the Overcollateralization
                  Floor.

              

      

      

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

      Class
        B-2 Principal Distribution Amount:
        With
        respect to the Class B-2 Certificates and any Distribution Date (i) prior
        to the
        Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
        for the Offered Certificates for that Distribution Date, the Principal
        Distribution Amount for that Distribution Date remaining after distribution
        of
        the Senior Principal Distribution Amount, the Class M-1 Principal Distribution
        Amount, the Class M-2 Principal Distribution Amount, the Class M-3 Principal
        Distribution Amount, the Class M-4 Principal Distribution Amount, the Class
        M-5
        Principal Distribution Amount, the Class M-6 Principal Distribution Amount
        and
        the Class B-1 Principal Distribution Amount or (ii) on or after the Stepdown
        Date if a Trigger Event is not in effect for the Offered Certificates for
        that
        Distribution Date, the lesser of:

      

      
        	 	
                (i)

              	
                the
                  sum of the Principal Distribution Amount for that Distribution
                  Date
                  remaining after distribution of the Senior Principal Distribution
                  Amount,
                  the Class M-1 Principal Distribution Amount, the Class M-2 Principal
                  Distribution Amount, the Class M-3 Principal Distribution Amount,
                  the
                  Class M-4 Principal Distribution Amount, the Class M-5 Principal
                  Distribution Amount, the Class M-6 Principal Distribution Amount
                  and the
                  Class B-1 Principal Distribution Amount; and

              

      

      

      
        	 	
                (ii)

              	
                the
                  excess (if any) of (A) the sum of (1) the Class Principal Balance
                  of the
                  Class B-2 Certificates immediately prior to that Distribution Date
                  and (2)
                  the aggregate Class Principal Balance of the Senior Certificates,
                  the
                  Class M Certificates and the Class B-1 Certificates (after taking
                  into
                  account the payment of the Senior, Class M-1, Class M-2, Class
                  M-3, Class
                  M-4, Class M-5, Class M-6 and Class B-1 Principal Distribution
                  Amounts for
                  such Distribution Date) over (B) the lesser of (i) the aggregate
                  Stated
                  Principal Balance of the Mortgage Loans as of the last day of the
                  related
                  Due Period multiplied by approximately 88.10% and (ii) the amount,
                  if any,
                  by which (x) the aggregate Stated Principal Balance of the Mortgage
                  Loans
                  as of the last day of the related Due Period exceeds (y) the
                  Overcollateralization Floor.

              

      

      

      Class
        B-3 Principal Distribution Amount:
        With
        respect to the Class B-3 Certificates and any Distribution Date (i) prior
        to the
        Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
        for the Offered Certificates for that Distribution Date, the Principal
        Distribution Amount for that Distribution Date remaining after distribution
        of
        the Senior Principal Distribution Amount, the Class M-1 Principal Distribution
        Amount, the Class M-2 Principal Distribution Amount, the Class M-3 Principal
        Distribution Amount, the Class M-4 Principal Distribution Amount, the Class
        M-5
        Principal Distribution Amount, the Class M-6 Principal Distribution Amount,
        the
        Class B-1 Principal Distribution Amount and the Class B-2 Principal Distribution
        Amount or (ii) on or after the Stepdown Date if a Trigger Event is not in
        effect
        for the Offered Certificates for that Distribution Date, the lesser
        of:

      

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

      
        	 	
                (i)

              	
                the
                  Principal Distribution Amount for that Distribution Date remaining
                  after
                  distribution of the Senior Principal Distribution Amount, the Class
                  M-1
                  Principal Distribution Amount, the Class M-2 Principal Distribution
                  Amount, the Class M-3 Principal Distribution Amount, the Class
                  M-4
                  Principal Distribution Amount, the Class M-5 Principal Distribution
                  Amount, the Class M-6 Principal Distribution Amount, the Class
                  B-1
                  Principal Distribution Amount and the Class B-2 Principal Distribution
                  Amount; and 

              

      

      

      
        	 	
                (ii)

              	
                the
                  excess (if any) of (A) the sum of (1) the Class Principal Balance
                  of the
                  Class B-3 Certificates immediately prior to that Distribution Date
                  and (2)
                  the aggregate Class Principal Balance of the Senior Certificates,
                  the
                  Class M Certificates and the Class B-1 and Class B-2 Certificates
                  (after
                  taking into account the payment of the Senior, Class M-1, Class
                  M-2, Class
                  M-3, Class M-4, Class M-5, Class M-6, Class B-1 and Class B-2 Principal
                  Distribution Amounts for such Distribution Date) over (B) the lesser
                  of
                  (i) the aggregate Stated Principal Balance of the Mortgage Loans
                  as of the
                  last day of the related Due Period multiplied by approximately
                  90.60% and
                  (ii) the amount, if any, by which (x) the aggregate Stated Principal
                  Balance of the Mortgage Loans as of the last day of the related
                  Due Period
                  exceeds (y) the Overcollateralization
                  Floor.

              

      

      

      Class
        M Certificates:
        All
        Certificates which include an “M” in their class designation.

      

      Class
        M-1 Principal Distribution Amount:
        With
        respect to the Class M-1 Certificates and any Distribution Date (i) prior
        to the
        Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
        for the Offered Certificates for that Distribution Date, the Principal
        Distribution Amount for that Distribution Date remaining after distribution
        of
        the Senior Principal Distribution Amount or (ii) on or after the Stepdown
        Date
        if a Trigger Event is not in effect for the Offered Certificates for that
        Distribution Date, the lesser of:

      

      
        	 	
                (i)

              	
                the
                  Principal Distribution Amount for that Distribution Date remaining
                  after
                  distribution of the Senior Principal Distribution Amount;
                  and

              

      

      

      
        	 	
                (ii)

              	
                the
                  excess (if any) of (A) the sum of (1) the Class Principal Balance
                  of the
                  Class M-1 Certificates immediately prior to that Distribution Date
                  and (2)
                  the aggregate Class Principal Balance of the Senior Certificates
                  (after
                  taking into account the payment of the Senior Principal Distribution
                  Amount for such Distribution Date) over (B) the lesser of (i) the
                  aggregate Stated Principal Balance of the Mortgage Loans as of
                  the last
                  day of the related Due Period multiplied by approximately 58.50%
                  and (ii)
                  the amount, if any, by which (x) the aggregate Stated Principal
                  Balance of
                  the Mortgage Loans as of the last day of the related Due Period
                  exceeds
                  (y) the Overcollateralization
                  Floor.

              

      

      

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

      Class
        M-2 Principal Distribution Amount:
        With
        respect to the Class M-2 Certificates and any Distribution Date (i) prior
        to the
        Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
        for the Offered Certificates for that Distribution Date, the Principal
        Distribution Amount for that Distribution Date remaining after distribution
        of
        the Senior Principal Distribution Amount and the Class M-1 Principal
        Distribution Amount or (ii) on or after the Stepdown Date if a Trigger Event
        is
        not in effect for the Offered Certificates for that Distribution Date, the
        lesser of: 

      

      
        	 	
                (i)

              	
                the
                  Principal Distribution Amount for that Distribution Date remaining
                  after
                  distribution of the Senior Principal Distribution Amount and the
                  Class M-1
                  Principal Distribution Amount; and

              

      

      

      
        	 	
                (ii)

              	
                the
                  excess (if any) of (A) the sum of (1) the Class Principal Balance
                  of the
                  Class M-2 Certificates immediately prior to that Distribution Date
                  and (2)
                  the aggregate Class Principal Balance of the Senior Certificates
                  and the
                  Class M-1 Certificates (after taking into account the payment of
                  the
                  Senior and Class M-1 Principal Distribution Amounts for such Distribution
                  Date) over (B) the lesser of (i) the aggregate Stated Principal
                  Balance of
                  the Mortgage Loans as of the last day of the related Due Period
                  multiplied
                  by approximately 67.00% and (ii) the amount, if any, by which (x)
                  the
                  aggregate Stated Principal Balance of the Mortgage Loans as of
                  the last
                  day of the related Due Period exceeds (y) the Overcollateralization
                  Floor.

              

      

      

      Class
        M-3 Principal Distribution Amount:
        With
        respect to the Class M-3 Certificates and any Distribution Date (i) prior
        to the
        Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
        for the Offered Certificates for that Distribution Date, the Principal
        Distribution Amount for that Distribution Date remaining after distribution
        of
        the Senior Principal Distribution Amount, the Class M-1 Principal Distribution
        Amount and the Class M-2 Principal Distribution Amount or (ii) on or after
        the
        Stepdown Date if a Trigger Event is not in effect for the Offered Certificates
        for that Distribution Date, the lesser of:

      

      
        	 	
                (i)

              	
                the
                  Principal Distribution Amount for that Distribution Date remaining
                  after
                  distribution of the Senior Principal Distribution Amount, the Class
                  M-1
                  Principal Distribution Amount and the Class M-2 Principal Distribution
                  Amount; and 

              

      

      

      
        	 	
                (ii)

              	
                the
                  excess (if any) of (A) the sum of (1) the Class Principal Balance
                  of the
                  Class M-3 Certificates immediately prior to that Distribution Date
                  and (2)
                  the aggregate Class Principal Balance of the Senior Certificates
                  and the
                  Class M-1 and Class M-2 Certificates (after taking into account
                  the
                  payment of the Senior, Class M-1 and Class M-2 Principal Distribution
                  Amounts for such Distribution Date) over (B) the lesser of (i)
                  the
                  aggregate Stated Principal Balance of the Mortgage Loans as of
                  the last
                  day of the related Due Period multiplied by approximately 71.40%
                  and (ii)
                  the amount, if any, by which (x) the aggregate Stated Principal
                  Balance of
                  the Mortgage Loans as of the last day of the related Due Period
                  exceeds
                  (y) the Overcollateralization
                  Floor.

              

      

      

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

      Class
        M-4 Principal Distribution Amount:
        With
        respect to the Class M-4 Certificates and any Distribution Date (i) prior
        to the
        Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
        for the Offered Certificates for that Distribution Date, the Principal
        Distribution Amount for that Distribution Date remaining after distribution
        of
        the Senior Principal Distribution Amount, the Class M-1 Principal Distribution
        Amount, the Class M-2 Principal Distribution Amount and the Class M-3 Principal
        Distribution Amount or (ii) on or after the Stepdown Date if a Trigger Event
        is
        not in effect for the Offered Certificates for that Distribution Date, the
        lesser of:

      

      
        	 	
                (i)

              	
                the
                  Principal Distribution Amount for that Distribution Date remaining
                  after
                  distribution of the Senior Principal Distribution Amount, the Class
                  M-1
                  Principal Distribution Amount, the Class M-2 Principal Distribution
                  Amount
                  and the Class M-3 Principal Distribution Amount; and
                  

              

      

      

      
        	 	
                (ii)

              	
                the
                  excess (if any) of (A) the sum of (1) the Class Principal Balance
                  of the
                  Class M-4 Certificates immediately prior to that Distribution Date
                  and (2)
                  the aggregate Class Principal Balance of the Senior Certificates
                  and the
                  Class M Senior Certificates (after taking into account the payment
                  of the
                  Senior, Class M-1, Class M-2 and Class M-3 Principal Distribution
                  Amounts
                  for such Distribution Date) over (B) the lesser of (i) the aggregate
                  Stated Principal Balance of the Mortgage Loans as of the last day
                  of the
                  related Due Period multiplied by approximately 75.30% and (ii)
                  the amount,
                  if any, by which (x) the aggregate Stated Principal Balance of
                  the
                  Mortgage Loans as of the last day of the related Due Period exceeds
                  (y)
                  the Overcollateralization Floor.

              

      

      

      Class
        M-5 Principal Distribution Amount:
        With
        respect to the Class M-5 Certificates and any Distribution Date (i) prior
        to the
        Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
        for the Offered Certificates for that Distribution Date, the Principal
        Distribution Amount for that Distribution Date remaining after distribution
        of
        the Senior Principal Distribution Amount, the Class M-1 Principal Distribution
        Amount, the Class M-2 Principal Distribution Amount, the Class M-3 Principal
        Distribution Amount and the Class M-4 Principal Distribution Amount or (ii)
        on
        or after the Stepdown Date if a Trigger Event is not in effect for the Offered
        Certificates for that Distribution Date, the lesser of:

      

      
        	 	
                (i)

              	
                the
                  Principal Distribution Amount for that Distribution Date remaining
                  after
                  distribution of the Senior Principal Distribution Amount, the Class
                  M-1
                  Principal Distribution Amount, the Class M-2 Principal Distribution
                  Amount, the Class M-3 Principal Distribution Amount and the Class
                  M-4
                  Principal Distribution Amount; and 

              

      

      

      
        	 	
                (ii)

              	
                the
                  excess (if any) of (A) the sum of (1) the Class Principal Balance
                  of the
                  Class M-5 Certificates immediately prior to that Distribution Date
                  and (2)
                  the aggregate Class Principal Balance of the Senior Certificates,
                  the
                  Class M Senior Certificates and the Class M-4 Certificates (after
                  taking
                  into account the payment of the Senior, Class M-1, Class M-2, Class
                  M-3
                  and Class M-4 Principal Distribution Amounts for such Distribution
                  Date)
                  over (B) the lesser of (i) the aggregate Stated Principal Balance
                  of the
                  Mortgage Loans as of the last day of the related Due Period multiplied
                  by
                  approximately 79.00% and (ii) the amount, if any, by which (x)
                  the
                  aggregate Stated Principal Balance of the Mortgage Loans as of
                  the last
                  day of the related Due Period exceeds (y) the Overcollateralization
                  Floor.

              

      

      

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

      Class
        M-6 Principal Distribution Amount:
        With
        respect to the Class M-6 Certificates and any Distribution Date (i) prior
        to the
        Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
        for the Offered Certificates for that Distribution Date, the Principal
        Distribution Amount for that Distribution Date remaining after distribution
        of
        the Senior Principal Distribution Amount, the Class M-1 Principal Distribution
        Amount, the Class M-2 Principal Distribution Amount, the Class M-3 Principal
        Distribution Amount, the Class M-4 Principal Distribution Amount and the
        Class
        M-5 Principal Distribution Amount or (ii) on or after the Stepdown Date if
        a
        Trigger Event is not in effect for the Offered Certificates for that
        Distribution Date, the lesser of:

      

      
        	 	
                (i)

              	
                the
                  Principal Distribution Amount for that Distribution Date remaining
                  after
                  distribution of the Senior Principal Distribution Amount, the Class
                  M-1
                  Principal Distribution Amount, the Class M-2 Principal Distribution
                  Amount, the Class M-3 Principal Distribution Amount, the Class
                  M-4
                  Principal Distribution Amount and the Class M-5 Principal Distribution
                  Amount; and 

              

      

      

      
        	 	
                (ii)

              	
                the
                  excess (if any) of (A) the sum of (1) the Class Principal Balance
                  of the
                  Class M-6 Certificates immediately prior to that Distribution Date
                  and (2)
                  the aggregate Class Principal Balance of the Senior Certificates,
                  the
                  Class M Senior Certificates and the Class M-4 and Class M-5 Certificates
                  (after taking into account the payment of the Senior, Class M-1,
                  Class
                  M-2, Class M-3, Class M-4 and Class M-5 Principal Distribution
                  Amounts for
                  such Distribution Date) over (B) the lesser of (i) the aggregate
                  Stated
                  Principal Balance of the Mortgage Loans as of the last day of the
                  related
                  Due Period multiplied by approximately 82.30% and (ii) the amount,
                  if any,
                  by which (x) the aggregate Stated Principal Balance of the Mortgage
                  Loans
                  as of the last day of the related Due Period exceeds (y) the
                  Overcollateralization Floor.

              

      

      

      Class
        M Senior Certificates:
        The
        Class M-1, Class M-2 and Class M-3 Certificates.

      

      Class
        OC Distributable Amount:
        With
        respect to any Distribution Date and the Class OC Certificates, the excess,
        if
        any, of (x) the sum of (i) the amount of interest accrued during the related
        Interest Accrual Period at the related Pass-Through Rate on the Class Principal
        Balance for such Distribution Date and not included in the Extra Principal
        Distribution Amount on that Distribution Date and (ii) the Overcollateralization
        Release Amount, if any, for such Distribution Date, over (y) the
        Overcollateralization Increase Amount and the amount of any Swap Termination
        Payment, if any, for such Distribution Date.

      

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

      Class
        P Distribution Amount:
        With
        respect to each Distribution Date, an amount equal to the total of all
        Prepayment Penalties received on the Mortgage Loans in the prior Due Period.
        

      

      Class
        Principal Balance:
        With
        respect to any Class of Certificates and as of any Distribution Date, the
        aggregate of the Certificate Principal Balances of all Certificates of such
        Class as of such date.

      

      Closing
        Date:
        March
        7, 2007.

      

      Code:
        The
        Internal Revenue Code of 1986, including any successor or amendatory
        provisions.

      

      Collection
        Account:
        The
        separate Eligible Account or Accounts created and maintained by the Servicer
        pursuant to Section 3.5 hereof with a depository institution for the benefit
        of
        the Trustee on behalf of Certificateholders and designated with the applicable
        Account Designation.

      

      Commission:
        As
        defined in Section 8.12 hereof.

      

      Compensating
        Interest:
        As to
        any Distribution Date and any Principal Prepayment in Full in respect of
        a
        Mortgage Loan that is received during the period from the eighteenth day
        of the
        month prior to the month of such Distribution Date through the last day of
        such
        month, an additional payment made by the Servicer to the extent funds are
        available from the total Servicing Fee payable for such Distribution Date,
        equal
        to the amount of interest at the Mortgage Rate (less the applicable Servicing
        Fee Rate) for that Mortgage Loan from the date of the prepayment through
        the
        last day of the month of such Distribution Date. For the avoidance of doubt,
        no
        Compensating Interest payment shall be required in connection with any
        shortfalls resulting from Principal Prepayments in part or the application
        of
        the Relief Act.

      

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

      

      Coop
        Shares:
        Shares
        issued by a Cooperative Corporation.

      

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

      

      Cooperative
        Property:
        The
        real property and improvements owned by the Cooperative Corporation, including
        the allocation of individual dwelling units to the holders of the Coop Shares
        of
        the Cooperative Corporation.

      

      Cooperative
        Unit:
        A
        single-family dwelling located in a Cooperative Property.

      

      Corporate
        Trust Office:
        The
        designated office of the Trustee at which at any particular time its corporate
        trust business with respect to this Agreement shall be
        administered.

      

      Cumulative
        Loss Trigger Event:
        With
        respect to any Distribution Date, the circumstances in which the aggregate
        amount of Realized Losses on the Mortgage Loans incurred since the Cut-off
        Date
        through the last day of the related Due Period divided by the aggregate
        outstanding principal balance of the Mortgage Loans as of the Cut-off Date
        exceeds the applicable percentages set forth below with respect to such
        Distribution Date: 

      

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

      

      
        	
                Distribution
                  Date

              	
                Percentage

              
	 	 
	
                March
                  2009 — February 2010

              	
                1.65%
                  for the first month, plus an additional 1/12th of 2.10% for each
                  month
                  thereafter

              
	
                March
                  2010 — February 2011

              	
                3.75%
                  for the first month, plus an additional 1/12th of 2.10% for each
                  month
                  thereafter

              
	
                March
                  2011 — February 2012

              	
                5.85%
                  for the first month, plus an additional 1/12th of 1.70% for each
                  month
                  thereafter

              
	
                March
                  2012 — February 2013

              	
                7.55%
                  for the first month, plus an additional 1/12th of 0.95% for each
                  month
                  thereafter

              
	
                March
                  2013 — February 2014

              	
                8.50%
                  for the first month, plus an additional 1/12th of 0.05% for each
                  month
                  thereafter

              
	
                March
                  2014 and thereafter

              	
                8.55%

              

      

      

      Custodial
        Agreement:
        The
        Custodial Agreement between the Custodian and Trustee dated as of February
        1,
        2007.

      

      Custodian:
        Deutsche Bank National Trust Company, and its successors and assigns in such
        capacity.

      

      Cut-off
        Date:
        February 1, 2007.

      

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

      

      Defaulted
        Swap Termination Payment:
        Any
        termination payment required to be made by the Supplemental Interest Trust
        to
        the Swap Counterparty pursuant to the Swap Agreement as a result of an event
        of
        default under the Swap Agreement with respect to which the Swap Counterparty
        is
        the defaulting party or a termination event under that agreement (other than
        illegality or a tax event of the Swap Counterparty) with respect to which
        the
        Swap Counterparty is the sole affected party.

      

      Defective
        Mortgage Loan:
        Any
        Mortgage Loan which is required to be repurchased pursuant to Section 2.2
        or
        2.3.

      

      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 Payment that results
        in a
        permanent forgiveness of principal, which valuation or reduction results
        from an
        order of such court which is final and non-appealable in a proceeding under
        the
        Bankruptcy Code.

      

      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      

      Definitive
        Certificates:
        Any
        Certificate evidenced by a Physical Certificate and any Certificate issued
        in
        lieu of a Book-Entry Certificate pursuant to Section 5.2(e).

      

      Delay
        Certificates:
        All
        interest-bearing Classes of Certificates other than the Non-Delay
        Certificates.

      

      Deleted
        Mortgage Loan:
        As
        defined in Section 2.3(d) hereof.

      

      Delinquency
        Loss Trigger Event:
        (1) with respect to any Distribution Date until the aggregate Class
        Principal Balance of the Senior Certificates has been reduced to zero, the
        circumstances in which the quotient (expressed as a percentage) of (x) the
        Three Month Rolling Average and (y) the aggregate unpaid principal balance
        of the Mortgage Loans, as of the last day of the related Due Period, equals
        or
        exceeds (z) 32.10% of the prior period’s Senior Enhancement Percentage and
        (2) with respect to any Distribution Date on or after the Distribution Date
        on which the aggregate Class Principal Balance of the Senior Certificates
        has
        been reduced to zero, the circumstances in which the quotient (expressed
        as a
        percentage) of (x) the Three Month Rolling Average and (y) the
        aggregate unpaid principal balance of the mortgage loans, as of the last
        day of
        the related Due Period, equals or exceeds (z) 38.55% of the prior period’s
        M-1 Enhancement Percentage.

      

      Delinquent:
        A
        Mortgage Loan is “Delinquent” if any payment due thereon is not made by the
        close of business on the Determination Date immediately following the day
        such
        payment is scheduled to be due. A Mortgage Loan is “30 days Delinquent” if such
        payment has not been received by the close of business on the Determination
        Date
        immediately succeeding the Determination Date on which such payment was
        categorized as “Delinquent.” Similarly for “60 days Delinquent,” “90 days
        Delinquent” and so on.

      

      Denomination:
        With
        respect to each Certificate, the amount set forth on the face thereof as
        the
“Initial Principal Balance of this Certificate” or the Percentage Interest
        appearing on the face thereof.

      

      Depositor:
        Saxon
        Asset Securities Company, a Virginia corporation, or its successor in
        interest.

      

      Depository:
        The
        initial Depository shall be The Depository Trust Company, the nominee of
        which
        is Cede & Co., as the registered Holder of the Book-Entry Certificates. The
        Depository shall at all times be a “clearing corporation” as defined in Section
        8-102(a)(5) of the Uniform Commercial Code of the State of New
        York.

      

      Depository
        Institution:
        The
        Trustee or any depository institution or trust company that (a) is
        incorporated under the laws of the United States of America or any State
        thereof, (b) is subject to supervision and examination by federal or state
        banking authorities and (c) has outstanding unsecured commercial paper or
        other short-term unsecured debt obligations that are rated “P-1” by Moody’s,
“F1+” by Fitch and “A-1” by Standard & Poor’s (to the extent they are Rating
        Agencies hereunder).

      

      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

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

      

      Determination
        Date:
        As to
        any Distribution Date, the earlier of (i) the 17th
        day of
        the month in which such Distribution Date occurs, or (ii) if such day is
        not a
        Business Day, the immediately preceding Business Day.

      

      Distribution
        Account:
        The
        separate Eligible Account created and maintained by the Trustee pursuant
        to
        Section 3.5(c) in the name of the Trustee for the benefit of the
        Certificateholders and designated with the applicable Account Designation.
        

      

      Distribution
        Account Deposit Date:
        As to
        any Distribution Date, the Business Day immediately preceding such Distribution
        Date.

      

      Distribution
        Date:
        The
        25th day of each calendar month after the initial issuance of the Certificates,
        or if such 25th day is not a Business Day, the next succeeding Business Day,
        commencing on the Initial Distribution Date.

      

      Due
        Date:
        With
        respect to any Distribution Date and each Mortgage Loan, the day of the month
        in
        which each Distribution Date occurs on which the related mortgage payment
        is due
        (or, in the case of an Odd Due Date Mortgage Loan, such day in the preceding
        month).

      

      Due
        Period:
        With
        respect to any Distribution Date, the period from and including the second
        day
        of each month through and including the first day of the following
        month.

      

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

      

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

      

      ERISA-Restricted
        Certificates:
        On the
        Closing Date, each of the Class P, Class OC and Class R Certificates;
        thereafter, the Class P, Class OC and Class R Certificates and any Class
        of
        Certificates that no longer satisfies the applicable ratings requirement
        under
        the Underwriter’s Exemption.

      

      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      

      ERISA-Restricted
        Swap Certificates:
        Any of
        the Offered Certificates.

      

      ERISA
        Qualifying Underwriting:
        A best
        efforts or firm commitment underwriting that meets the requirements of the
        Underwriter’s Exemption.

      

      Escrow
        Account:
        The
        Eligible Account or Accounts established and maintained pursuant to Section
        3.6(a) hereof.

      

      Event
        of Default:
        As
        defined in Section 7.1 hereof.

      

      Excess
        Reserve Fund Account:
        The
        separate Eligible Account created and maintained by the Trustee pursuant
        to
        Section 4.7 in the name of the Trustee for the benefit of the
        Certificateholders and designated “Deutsche Bank National Trust Company, in
        trust for registered Holders of Saxon Asset Securities Trust 2007-1, Mortgage
        Pass-Through Certificates, Series 2007-1.” Funds in the Excess Reserve Fund
        Account shall be held in trust for the Certificateholders for the uses and
        purposes set forth in this Agreement. All investments made in respect of
        funds
        on deposit in the Excess Reserve Fund Account shall only be made in Permitted
        Investments.

      

      Excess
        Proceeds:
        With
        respect to any Liquidated Mortgage Loan, the amount, if any, by which the
        sum of
        any Liquidation Proceeds of such Mortgage Loan received during the Prepayment
        Period in which such Mortgage Loan became a Liquidated Mortgage Loan, net
        of any
        amounts previously reimbursed to the Servicer as Nonrecoverable Advance(s)
        with
        respect to such Mortgage Loan pursuant to Section 3.8(a)(iii), exceeds (i)
        the
        unpaid principal balance of such Liquidated Mortgage Loan as of the Due Date
        in
        the month in which such Mortgage Loan became a Liquidated Mortgage Loan plus
        (ii) accrued interest at the Mortgage Rate from the Due Date as to which
        interest was last paid or advanced (and not reimbursed) to Certificateholders
        up
        to the Due Date applicable to the Distribution Date immediately following
        the
        Prepayment Period during which such liquidation occurred. Notwithstanding
        the
        foregoing, Excess Proceeds with respect to any Nonrecoverable Mortgage Loan
        shall be equal to the amount, if any, by which Subsequent Recoveries with
        respect to such Nonrecoverable Mortgage Loan exceed the Realized Loss with
        respect thereto.

      

      Excess
        Subordinate Amount:
        With
        respect to any Distribution Date and the Offered Certificates, the excess,
        if any,
        of (i) the Overcollateralized Amount on that Distribution Date over
        (ii) the
        Overcollateralization Target Amount for such Distribution Date.

      

      Exchange
        Act:
        As
        defined in Section 8.12 hereof.

      

      Extra
        Principal Distribution Amount:
        With
        respect to the Offered Certificates and any Distribution Date will be the
        lesser
        of (i) the excess of (x) the Interest Remittance Amount, over (y) the sum
        of (a)
        the Senior Interest Distribution Amount, (b) the Subordinate Interest
        Distribution Amount and (c) any Net Swap Payments and any Swap Termination
        Payment owed to the Swap Counterparty, but not including any Defaulted Swap
        Termination Payment owed to the Swap Counterparty, if any, in each case,
        on such
        Distribution Date and (ii) the Overcollateralization Increase Amount for
        such
        Distribution Date.

      

      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

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

      

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

      

      FIRREA:
        The
        Financial Institutions Reform, Recovery, and Enforcement Act of
        1989.

      

      Fitch:
        Fitch,
        Inc., or any successor thereto. If Fitch is designated as a Rating Agency
        in the
        Preliminary Statement, the address for notices to Fitch shall be Fitch, Inc.,
        One State Street Plaza, New York, New York 10004, Attention: Residential
        Mortgage Surveillance Group, or such other address as Fitch may hereafter
        furnish to the Depositor and the Servicer.

      

      Freddie
        Mac:
        The
        entity formally known as 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.

      

      Group:
        The
        Group 1 Mortgage Loans or the Group 2 Mortgage Loans, as the context
        requires.

      

      Group
        1 Mortgage Loans:
        The
        pool of Mortgage Loans identified in the Mortgage Loan Schedule as having
        been
        assigned to Group 1 and any Substitute Mortgage Loans delivered in replacement
        of any Mortgage Loan.

      

      Group
        1 Senior Basis Risk Carry Forward Amount:
        With
        respect to any Class of Group 1 Senior Certificates and any Distribution
        Date,
        an amount equal to the sum of (i) the excess, if any, of (x) the amount of
        interest such Class of Group 1 Senior Certificates would have been entitled
        to
        receive on such Distribution Date if neither the Aggregate Net WAC Cap nor
        the
        Group 1 WAC Cap had been applicable to such Class on such Distribution Date
        over
        (y) the amount of interest accrued on such Distribution Date at the lesser
        of:
        (a) the Aggregate Net WAC Cap and (b) the Group 1 WAC Cap and (ii) the related
        Basis Risk Carry Forward Amount for previous Distribution Dates not previously
        distributed together with interest thereon at a rate equal to the related
        Pass-Through Rate (without regard to the Net WAC Cap) for such Class of Group
        1
        Senior Certificates for the most recently ended Interest Accrual
        Period.

      

      Group
        1 Senior Certificates:
        The
        Class A-1 Certificates.

      

      Group
        1 Senior Principal Allocation Amount:
        With
        respect to the Group 1 Senior Certificates and any Distribution Date, the
        product of the Class A Principal Allocation Percentage for the Group 1 Senior
        Certificates for that Distribution Date and the Senior Principal Distribution
        Amount for that Distribution Date.

      

      Group
        1 WAC Cap:
        With
        respect to the Group 1 Senior Certificates and any Distribution Date, a per
        annum rate equal to the product of (i) the excess, if any, of (a) the weighted
        average of the Net Mortgage Rates of the Group 1 Mortgage Loans weighted
        based
        on their relative Stated Principal Balances as of the first day of the related
        Due Period, adjusted to reflect prepayments received after the first Day
        of the
        related Due Period that were distributed on the immediately preceding
        Distribution Date, over (b) the Swap Payment Rate for such Distribution Date,
        multiplied by (ii) the quotient of 30 divided by the actual number of days
        in
        the Interest Accrual Period.

      

      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

      Group
        2 Mortgage Loans:
        The
        pool of Mortgage Loans identified in the Mortgage Loan Schedule as having
        been
        assigned to Group 2 and any Substitute Mortgage Loans delivered in replacement
        of any Mortgage Loan.

      

      Group
        2 Senior Basis Risk Carry Forward Amount:
        With
        respect to any Class of Group 2 Senior Certificates and any Distribution
        Date,
        an amount equal to the sum of (i) the excess, if any, of (x) the amount of
        interest such Class of Group 2 Senior Certificates would have been entitled
        to
        receive on such Distribution Date if neither the Aggregate Net WAC Cap nor
        the
        Group 2 WAC Cap had been applicable to such Class on such Distribution Date
        over
        (y) the amount of interest accrued on such Distribution Date at the lesser
        of:
        (a) the Aggregate Net WAC Cap and (b) the Group 2 WAC Cap and (ii) the related
        Basis Risk Carry Forward Amount for previous Distribution Dates not previously
        distributed together with interest thereon at a rate equal to the related
        Pass-Through Rate (without regard to the Net WAC Cap) for such Class of Group
        2
        Senior Certificates for the most recently ended Interest Accrual
        Period.

      

      Group
        2 Senior Certificates:
        The
        Class A-2a, Class A-2b, Class A-2c and Class A-2d Certificates.

      

      Group
        2 Senior Principal Allocation Amount:
        With
        respect to the Group 2 Senior Certificates and any Distribution Date, the
        product of the Class A Principal Allocation Percentage for the Group 2 Senior
        Certificates for that Distribution Date and the Senior Principal Distribution
        Amount for that Distribution Date.

      

      Group
        2 WAC Cap:
        With
        respect to the Group 2 Senior Certificates and any Distribution Date, a per
        annum rate equal to the product of (i) the excess, if any, of (a) the weighted
        average of the Net Mortgage Rates of the Group 2 Mortgage Loans weighted
        based
        on their relative Stated Principal Balances as of the first day of the related
        Due Period, adjusted to reflect prepayments received after the first Day
        of the
        related Due Period that were distributed on the immediately preceding
        Distribution Date, over (b) the Swap Payment Rate for such Distribution Date,
        multiplied by (ii) the quotient of 30 divided by the actual number of days
        in
        the Interest Accrual Period.

      

      Indirect
        Participant:
        A
        broker, dealer, bank or other financial institution or other Person that
        clears
        through or maintains a custodial relationship with a Depository
        Participant.

      

      Initial
        Distribution Date:
        March
        26, 2007.

      

      Initial
        Optional Termination Date:
        The
        first Distribution Date on or after which the aggregate Stated Principal
        Balance
        of the Mortgage Loans is less than 10% of the aggregate Stated Principal
        Balance
        thereof as of the Cut-off Date.

      

      
        
          
          

        

        
          22

          
            

          

        

        
          
          

        

      

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

      

      Insurance
        Proceeds:
        Proceeds paid by an insurer pursuant to any Insurance Policy, in each case
        other
        than any amount included in such Insurance Proceeds in respect of Insured
        Expenses.

      

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

      

      Interest
        Accrual Period:
        For any
        Class of Offered Certificates and the March 2007 Distribution Date will be
        the
        19-day period commencing on the Closing Date and ending on the day immediately
        preceding that Distribution Date. The Interest Accrual Period for any
        Distribution Date thereafter and any Class of Offered Certificates shall
        be the
        one-month period commencing on the Distribution Date in the month prior to
        the
        month in which that Distribution Date occurs and ending on the day immediately
        preceding that Distribution Date. With respect to each Class of Offered
        Certificates, interest will be calculated on the basis of a 360-day year
        and the
        actual number of days that elapsed in the related Interest Accrual
        Period.

      

      Interest
        Carry Forward Amount:
        With
        respect to any Class of Offered Certificates and any Distribution Date, the
        amount, if any, by which the Interest Distribution Amount for that Class
        of
        Offered Certificates for the immediately preceding Distribution Date exceeded
        the actual amount distributed on such Class in respect of interest on the
        immediately preceding Distribution Date, together with any Interest Carry
        Forward Amount with respect to such Class remaining unpaid from previous
        Distribution Dates, plus interest accrued thereon at the related Pass-Through
        Rate for the most recently ended Interest Accrual Period.

      

      Interest
        Distribution Amount:
        For the
        Offered Certificates and any Distribution Date will be the aggregate of the
        Senior and Subordinate Interest Distribution Amounts for that Distribution
        Date.

      

      Interest
        Determination Date:
        With
        respect to the first Interest Accrual Period, March
        7,
        2007,
        and with respect to any subsequent Interest Accrual Period, the second London
        Business Day preceding such Interest Accrual Period.

      

      Interest
        Rate Cap Payment:
        With
        respect to the Distribution Date, the payment, if any, required to be made
        by
        the Cap Counterparty under the Cap Agreement with respect to such Distribution
        Date.

      

      Interest
        Remittance Amount:
        For the
        Offered Certificates and any Distribution Date will be that portion of the
        Available Distribution Amount for such Distribution Date that represents
        interest received or advanced on the Mortgage Loans.

      

      Last
        Endorsee:
        As
        defined in Section 2.1(b).

      

      
        
          
          

        

        
          23

          
            

          

        

        
          
          

        

      

      Latest
        Possible Maturity Date:
        The
        Distribution Date following the third anniversary of the scheduled maturity
        date
        of the Mortgage Loan having the latest scheduled maturity date as of the
        Cut-off
        Date.

      

      Liquidated
        Mortgage Loan:
        With
        respect to any Distribution Date, a defaulted Mortgage Loan (including any
        REO
        Property) which was liquidated by the Servicer in any manner, including but
        not
        limited to a disposition pursuant to Section 3.11(i), in the Prepayment Period
        for such Distribution Date and as to which the Servicer has determined (in
        accordance with this Agreement) that it has received all amounts it expects
        to
        receive in connection with the liquidation of such Mortgage Loan, including
        the
        final disposition of an REO Property.

      

      Liquidation
        Proceeds:
        Amounts, including Insurance Proceeds, received by the Servicer in connection
        with the partial or complete liquidation of defaulted Mortgage Loans, whether
        through trustee’s sale, foreclosure sale, disposition pursuant to Section
        3.11(i), or otherwise or amounts received in connection with any condemnation
        or
        partial release of a Mortgaged Property and any other proceeds received in
        connection with an REO Property, less the sum of related unreimbursed Servicing
        Fees, Servicing Advances and P&I Advances.

      

      Loan
        Group 1

      

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

      

      London
        Business Day:
        A day
        on which banks are open for dealing in foreign currency and exchange in London
        and New York City.

      

      Lost
        Mortgage Note:
        Any
        Mortgage Note the original of which was permanently lost or destroyed and
        has
        not been replaced.

      

      Lower-Tier
        Interest:
        Any
        interest created in REMIC 1 or REMIC 2.

      

      M-1
        Enhancement Percentage:
        For any
        Distribution Date, the percentage obtained by dividing (x) the aggregate
        Class
        Principal Balance of the Class M-2, Class M-3, Class M-4, Class M-5, Class
        M-6,
        Class B-1, Class B-2 and Class B-3 Certificates (together with the
        Overcollateralized Amount and taking into account the distributions of the
        Principal Distribution Amount and all payments of principal from the Swap
        Account, if any, for such Distribution Date) by (y) the aggregate principal
        balance of the Mortgage Loans as of the last day of the related Due
        Period.

      

      Maintenance:
        With
        respect to any Cooperative Unit, the rent paid by the Mortgagor to the
        Cooperative Corporation pursuant to the Proprietary Lease.

      

      Majority
        in Interest:
        As to
        any Class of Regular Certificates, the Holders of Certificates of such Class
        evidencing, in the aggregate, at least 51% of the Percentage Interests evidenced
        by all Certificates of such Class.

      

      
        
          
          

        

        
          24

          
            

          

        

        
          
          

        

      

      MERS:
        Mortgage Electronic Registration Systems, Inc., a Delaware corporation, or
        any
        successor in interest thereto.

      

      MERS
        Mortgage Loan:
        Any
        Mortgage Loan as to which the related Mortgage, or an assignment of Mortgage,
        has been or will be recorded in the name of MERS, as nominee for the holder
        from
        time to time of the Mortgage Note.

      

      Monthly
        Statement:
        The
        statement delivered to the Certificateholders pursuant to
        Section 4.5.

      

      Moody’s:
        Moody’s
        Investors Service, Inc., or any successor thereto. If Moody’s is designated as a
        Rating Agency in the Preliminary Statement, the address for notices to Moody’s
        shall be Moody’s Investors Service, Inc., 99 Church Street, New York, New York
        10007, Attention: Residential Pass-Through Monitoring, or such other address
        as
        Moody’s may hereafter furnish to the Depositor or the Servicer.

      

      Mortgage:
        The
        mortgage, deed of trust or other instrument creating a first or second lien
        on
        an estate in fee simple or leasehold interest in real property securing a
        Mortgage Note.

      

      Mortgage
        Loan Document Requirements:
        As
        defined in Section 2.2 hereof.

      

      Mortgage
        File:
        The
        mortgage documents listed in Section 2.1 hereof pertaining to a particular
        Mortgage Loan and any additional documents delivered to the Trustee to be
        added
        to the Mortgage File pursuant to this Agreement.

      

      Mortgage
        Loan Documents:
        As
        defined in Section 2.1 hereof.

      

      Mortgage
        Loans:
        Such of
        the mortgage loans transferred and assigned pursuant to the provisions hereof
        as
        from time to time are held as a part of the Trust Fund (including any REO
        Property), the mortgage loans so held being identified in the Mortgage Loan
        Schedule, notwithstanding foreclosure or other acquisition of title of the
        related Mortgaged Property.

      

      Mortgage
        Loan Schedule:
        The
        list of Mortgage Loans (as from time to time amended by the Servicer to reflect
        the addition of Substitute Mortgage Loans and the deletion of Deleted Mortgage
        Loans pursuant to the provisions of this Agreement) transferred to the Trustee
        as part of the Trust Fund and from time to time subject to this Agreement,
        attached hereto as Schedule I, setting forth the following information with
        respect to each Mortgage Loan:

      

      
        	 	
                (i)

              	
                the
                  loan number;

              

      

      

      
        	 	
                (ii)

              	
                the
                  Mortgagor’s name;

              

      

      

      
        	 	
                (iii)

              	
                the
                  original principal balance; 

              

      

      

      
        	 	
                (iv)

              	
                the
                  Stated Principal Balance as of the Cut-off Date;
                  

              

      

      

      
        	 	
                (v)

              	
                the
                  Mortgage Rate;

              

      

      

      
        
          
          

        

        
          25

          
            

          

        

        
          
          

        

      

      
        	 	
                (vi)

              	
                Servicing
                  Fee; and

              

      

      

      
        	 	
                (vii)

              	
                the
                  related Group. 

              

      

      

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

      

      Mortgage
        Rate:
        The
        annual rate of interest borne by a Mortgage Note from time to time.

      

      Mortgaged
        Property:
        The
        underlying property securing a Mortgage Loan, which, in the case of a
        Cooperative Loan, is the related Coop Shares and Proprietary Lease.

      

      Mortgagor:
        Any
        obligor on a Mortgage Note.

      

      Net
        Monthly Excess Cashflow:
        For the
        Certificates and any Distribution Date, the excess, if any, of (x) the Available
        Distribution Amount for the Distribution Date over (y) the sum of (1) the
        aggregate of the Senior Interest Distribution Amounts payable to the holders
        of
        the Senior Certificates, the Subordinate Interest Distribution Amounts payable
        to the holders of the Subordinate Certificates, the Principal Distribution
        Amount and (2) the aggregate of all Net Swap Payments and any Swap Termination
        Payment owed to the Swap Counterparty, including, without limitation, any
        Senior
        Defaulted Swap Termination Payment, but not including any other Defaulted
        Swap
        Termination Payment owed to the Swap Counterparty, if any, remaining unpaid
        on
        that Distribution Date after distributions of the Interest Distribution Amount
        and the Principal Distribution Amount for that Distribution Date.

      

      Net
        Mortgage Rate:
        For
        each Mortgage Loan, the mortgage interest rate thereon less the Servicing
        Fee
        Rate and the Trustee Fee Rate.

      

      Net
        Prepayment Interest Shortfall:
        As to
        any Distribution Date and Group, the amount by which the aggregate of Prepayment
        Interest Shortfalls during the related Prepayment Period exceeds an amount
        equal
        to the Compensating Interest, if any, for such Distribution Date.

      

      Net
        Swap Payment:
        With
        respect to any Distribution Date, any net payment (other than a Swap Termination
        Payment) payable by the Trust to the Swap Provider on the related Fixed Rate
        Payer Payment Date (as defined in the Swap Agreement).

      

      Net
        Swap Receipt:
        With
        respect to any Distribution Date, any net payment (other than a Swap Termination
        Payment) made by the Swap Provider to the Trust on the related Floating Rate
        Payer Payment Date (as defined in the Swap Agreement).

      

      Net
        WAC Cap:
        The
        Aggregate Net WAC Cap, the Group 1 WAC Cap or the Group 2 WAC Cap, as the
        context requires.

      

      Non-MERS
        Mortgage Loan:
        Any
        Mortgage Loan other than a MERS Mortgage Loan.

      

      Nonrecoverable
        Advance:
        Any
        portion of any P&I Advance or Servicing Advance previously made or proposed
        to be made by the Servicer that, in the good faith judgment of the advancing
        party, will not be ultimately recoverable by such advancing party from the
        related Mortgagor, related Liquidation Proceeds or otherwise.

      

      
        
          
          

        

        
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      Nonrecoverable
        Mortgage Loan:
        Any
        Mortgage Loan that has been determined to be a Nonrecoverable Mortgage Loan
        pursuant to Section 3.11(f) hereof and is identified in an Officer’s Certificate
        signed by a Servicing Officer delivered to the Servicer pursuant to Section
        3.11(f) hereof. For the avoidance of doubt, Mortgage Loans represented by
        REO
        Property shall not constitute Nonrecoverable Mortgage Loans.

      

      Nonrecoverable
        Mortgage Loan Purchase Price:
        As to
        any Nonrecoverable Mortgage Loan, an amount equal to the sum of (i) the
        Projected Net Liquidation Value thereof on the date of purchase of such loan
        pursuant to this Agreement; and (ii) any accrued interest at the applicable
        Mortgage Rate from the date through which interest was last paid by the
        Mortgagor to the Due Date occurring in the Due Period immediately preceding
        the
        Distribution Date on which the Nonrecoverable Mortgage Loan Purchase Price
        is to
        be distributed to Certificateholders.

      

      Notice
        Address:
        For
        purposes hereof, the addresses of the Depositor, the Servicer and the Trustee,
        are as follows:

      

      
        	
                (i)

              	
                If
                  to the Depositor:

              

      

       

      Saxon
        Asset Securities Company

      4860
        Cox
        Road

      Glen
        Allen, Virginia 23060

       

      
        	
                (ii)

              	
                If
                  to the Trustee:

              

      

       

      Deutsche
        Bank National Trust Company

      1761
        East
        St. Andrew Place

      Santa
        Ana, California 92705

      Attention:
        SX 0701

      

      
        	
                (iii)

              	
                If
                  to the Servicer:

              

      

       

      Saxon
        Mortgage Services, Inc.

      4708
        Mercantile Drive

      Fort
        Worth, TX 76137

      Attn:
        David Dill, Chief Executive Officer and President

      

      Notice
        of Final Distribution:
        The
        notice to be provided pursuant to Section 9.2 to the effect that final
        distribution on any of the Certificates shall be made only upon presentation
        and
        surrender thereof.

      

      Odd
        Due Date Mortgage Loan:
        Any
        Mortgage Loan whose monthly payments are due on a day other than the first
        day
        of the month.

      

      
        
          
          

        

        
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      Offered
        Certificates:
        The
Class
        A-1, Class A-2a, Class A-2b, Class A-2c, Class A-2d, Class M-1, Class M-2,
        Class
        M-3, Class M-4, Class M-5, Class M-6, Class B-1, Class B-2 and Class B-3
        Certificates.

      

      Officer’s
        Certificate:
        A
        certificate signed by the Chairman of the Board, the Vice Chairman of the
        Board,
        the President, a Managing Director, a Vice President (however denominated),
        an
        Assistant Vice President, the Treasurer, the Secretary, or one of the Assistant
        Treasurers or Assistant Secretaries of the entity required by the terms of
        this
        Agreement to deliver such certificate, or by such officer of such entity
        as may
        be required to sign such certificate by the terms of this Agreement relating
        to
        such particular certificate.

      

      One-Month
        LIBOR:
        As of
        any Interest Determination Date, the rate for one-month U.S. dollar deposits
        which appears in the Telerate Page 3750, as of 11:00 a.m., London time, on
        such
        Interest Determination Date. If such rate does not appear on Telerate Page
        3750,
        the rate for that day will be determined on the basis of the rates at which
        deposits in United States dollars are offered by the Reference Banks at
        approximately 11:00 a.m., London time, on that day to prime banks in the
        London
        interbank market for a period equal to the relevant Interest Accrual Period
        (commencing on the first day of such Interest Accrual Period). The Calculation
        Agent, as agent for the Servicer, 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 for that day will be the arithmetic-
        mean
        of the quotations. If fewer than two quotations are provided as requested,
        the
        rate for that day will be the arithmetic-mean of the rates quoted by major
        banks
        in New York City, selected by the Servicer, at approximately 11:00 a.m.,
        New
        York City time, on that day for loans in United States dollars to leading
        European banks for a period equal to the relevant Interest Accrual Period
        (commencing on the first day of such Interest Accrual Period). The Calculation
        Agent, as agent for the Servicer, shall review Telerate Page 3750 as of the
        required time, make the required requests to the principal offices of the
        Reference Banks and selections of major banks in New York City and shall
        determine the rate which constitutes One-Month LIBOR for each Interest
        Determination Date.

      

      Opinion
        of Counsel:
        A
        written opinion of counsel, who may be counsel for the Depositor or the
        Servicer, including in-house counsel, reasonably acceptable to the Trustee.
        

      

      Optional
        Termination:
        The
        termination of the trust created hereunder in connection with the purchase
        of
        the Mortgage Loans pursuant to Section 9.1 hereof.

      

      OTS:
        The
        Office of Thrift Supervision.

      

      Outstanding:
        With
        respect to the Certificates as of any date of determination, all Certificates
        theretofore executed and authenticated under this Agreement except:

      

      (i) Certificates
        theretofore canceled by the Trustee or delivered to the Trustee for
        cancellation; and

      

      (ii) Certificates
        in exchange for which or in lieu of which other Certificates have been executed
        and delivered by the Trustee pursuant to this Agreement.

      

      
        
          
          

        

        
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      Outstanding
        Mortgage Loan:
        As of
        any Determination Date, a Mortgage Loan with a Stated Principal Balance greater
        than zero which was not the subject of a Principal Prepayment in Full prior
        to
        such Determination Date and which did not become a Liquidated Mortgage Loan
        prior to such Determination Date.

      

      Overcollateralized
        Amount:
        With
        respect to the Offered Certificates as of the Closing Date will be an amount
        equal to approximately $29,243,726. With respect to any Distribution Date
        following the Closing Date, the Overcollateralized Amount is the amount by
        which
        the aggregate Stated Principal Balance of the Mortgage Loans as of the last
        day
        of the related Due Period exceeds the aggregate Class Principal Balance of
        the
        Offered Certificates after taking into account all payments of principal
        on such
        Distribution Date.

      

      Overcollateralization
        Increase Amount:
        With
        respect to the Offered Certificates and any Distribution Date, the amount,
        if
        any, by which the Overcollateralization Target Amount exceeds the
        Overcollateralized Amount for such Distribution Date (calculated for this
        purpose only after assuming that 100% of the Principal Remittance Amount
        on such
        Distribution Date has been distributed).

      

      Overcollateralization
        Target Amount:
        For the
        Offered Certificates and any Distribution Date (i) prior to the Stepdown
        Date,
        the product of (x) 4.70% and (y) the sum of (A) the aggregate Stated Principal
        Balance of the Mortgage Loans as of the Cut-off Date and (B) $3,919.04, (ii)
        on
        and after the Stepdown Date, provided that a Trigger Event is not in effect,
        the
        lesser of (a) the product of (x) 9.40% and (y) the aggregate Stated Principal
        Balance of the Mortgage Loans as of the last day of the related Due Period
        and
        (b) the product of (x) 4.70% and (y) the sum of (A) the aggregate Stated
        Principal Balance of the Mortgage Loans as of the Cut-off Date and (B) $3,919.04
        and (iii) on and after the Stepdown Date, if a Trigger Event is in effect,
        the
        Overcollateralization Target Amount for the immediately preceding Distribution
        Date; provided, however, that on each Distribution Date the
        Overcollateralization Target Amount shall not be lower than the applicable
        Overcollateralization Floor.

      

      Overcollateralization
        Floor:
        Prior
        to the Distribution Date in March 2027, 0.50% of the aggregate principal
        balance
        of the Mortgage Loans as of the Cut-off Date. Thereafter, the
        Overcollateralization Floor will be equal to the greater of (i) 0.50% of
        the
        aggregate principal balance of the Mortgage Loans as of the Cut-off Date,
        and
        (ii) the sum of (a) 0.10% of the aggregate principal balance of the Mortgage
        Loans as of the Cut-off Date and (b) the aggregate principal balance, as
        of the
        last day of the related Due Period, of all outstanding Mortgage Loans having
        original terms to maturity of 40 years.

      

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

      

      P&I
        Advance:
        The
        payment required to be made by the Servicer with respect to any Distribution
        Date pursuant to Section 3.19, the amount of any such payment being equal
        to the
        aggregate of payments of principal and interest (net of the related Servicing
        Fee and any net income in the case of any REO Property) on the Mortgage Loans
        that were due during the related Due Period and not received as of the close
        of
        business on the related Determination Date, less the aggregate amount of
        any
        such delinquent payments that the Servicer has determined would constitute
        a
        Nonrecoverable Advance if advanced.

      

      
        
          
          

        

        
          29

          
            

          

        

        
          
          

        

      

      Pass-Through
        Rate:
        For any
        Class of Offered Certificates and any Distribution Date, the rate described
        in
        the Pass-Through Rate Schedule.

      

      Pass-Through
        Rate Schedule:
        The
        Schedule setting forth the Pass-Through Rates of the Certificates, attached
        as
        Schedule II hereto.

      

      Paying
        Agent:
        Deutsche Bank National Trust Company, a New York banking corporation, and
        its
        successors and assigns in such capacity.

      

      Percentage
        Interest:
        As to
        any Certificate, the percentage interest evidenced thereby in distributions
        required to be made on the related Class, such percentage interest being
        set
        forth on the face thereof or equal to the percentage obtained by dividing
        the
        Denomination of such Certificate by the aggregate of the Denominations of
        all
        Certificates of the same Class.

      

      Permitted
        Investments:
        Any one
        or more of the following obligations or securities acquired at a purchase
        price
        of not greater than par, regardless of whether issued by the Servicer, the
        Trustee or any of their respective Affiliates:

      

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

      

      (ii) demand
        and time deposits in, certificates of deposit of, or 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 and issued by, any Depository Institution and rated
“P-1”
by Moody’s, “F1+” by Fitch and “A-1+” by Standard & Poor’s (to the extent
        they are Rating Agencies hereunder and are so rated by such Rating
        Agency);

      

      (iii) repurchase
        obligations with respect to any security described in clause (i) above
        entered into with a Depository Institution (acting as principal);

      

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

      

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

      

      
        
          
          

        

        
          30

          
            

          

        

        
          
          

        

      

      (vi) units
        of
        money market funds, including money market funds advised by the Depositor,
        the
        Trustee or an Affiliate thereof, that have been rated “Aaa” by Moody’s, “AAAm”
by Standard & Poor’s and at least “AA” by Fitch (to the extent they are
        Rating Agencies hereunder and such funds are so rated by such Rating Agency);
        and

      

      (vii) if
        previously confirmed in writing to the Trustee, any other demand, money market
        or time deposit, or any other obligation, security or investment, as may
        be
        acceptable to the Rating Agencies as a permitted investment of funds backing
        “Aaa” and “AAA” rated securities;

      

      

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

      

      Permitted
        Transferee:
        Any
        person other than a “disqualified organization” as defined in section
        860E(e)(5).

      

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

      

      Physical
        Certificates:
        The
        Private Certificates.

      

      Prepayment
        Interest Excess:
        As to
        any Principal Prepayment in Full received by the Servicer from the first
        day
        through the seventeenth day of any calendar month (other than the calendar
        month
        in which the Cut-off Date occurs), all amounts paid by the related Mortgagor
        in
        respect of interest on such Principal Prepayment. All Prepayment Interest
        Excess
        shall be paid to the Servicer as additional servicing compensation.

      

      Prepayment
        Interest Shortfall:
        As to
        any Distribution Date, Mortgage Loan and Principal Prepayment received (a)
        during the period from the eighteenth day of the month preceding the month
        of
        such Distribution Date through the last day of such month, in the case of
        a
        Principal Prepayment in Full, or (b) during the month preceding the month
        of
        such Distribution Date, in the case of a partial Principal Prepayment, the
        amount, if any, by which one month’s interest at the related Mortgage Rate (less
        the related Servicing Fee) on such Principal Prepayment exceeds the amount
        of
        interest actually paid by the Mortgagor in connection with such Principal
        Prepayment.

      

      Prepayment
        Penalty:
        With
        respect to any Prepayment Period, any prepayment premium, penalty or charge
        collected by the Servicer from a Mortgagor pursuant to the terms of the related
        Mortgage Note.

      

      
        
          
          

        

        
          31

          
            

          

        

        
          
          

        

      

      Prepayment
        Period:
        As to
        each Distribution Date, the period from but excluding the Cut-off Date to
        and
        including the 17th
        day of
        the month in which the first Determination Date occurs and each period
        thereafter from and including the 18th
        day of a
        month to and including the Determination Date occurring in the following
        month.

      

      Primary
        Mortgage Insurance Policy:
        Any
        mortgage guaranty insurance, if any, on an individual Mortgage Loan, as
        evidenced by a policy or certificate, whether such policy is obtained by
        the
        originator, the lender, the borrower or the Seller on behalf of the Trust
        Fund.

      

      Principal
        Distribution Amount:
        For the
        Offered Certificates and any Distribution Date will be the
        sum of
        the
        Basic Principal Distribution Amount and the Extra Principal Distribution
        Amount,
        in each case for that Distribution Date.

      

      Principal
        Remittance Amount:
        For the
        Offered Certificates and any Distribution Date, the
        sum of 

      

      (i)
        the
        principal portion of all Scheduled Payments on the Mortgage Loans due during
        the
        related Due Period, whether or not received on or prior to the related
        Determination Date; 

      

      (ii)
        the
        principal portion of all proceeds received in respect of the repurchase of
        a
        mortgage loan (or, in the case of a substitution, certain amounts representing
        a
        principal adjustment as required by this Agreement) during the related
        Prepayment Period; and 

      

      (iii)
        the
        principal portion of all other unscheduled collections, including Insurance
        Proceeds, condemnation proceeds, Liquidation Proceeds and all full and partial
        Principal Prepayments, received during the related Prepayment Period, to
        the
        extent applied as recoveries of principal on the Mortgage Loans. 

      

      In
        no
        event will the Principal Remittance Amount with respect to any Distribution
        Date
        be (x) less than zero or (y) greater than the then outstanding aggregate
        Class
        Principal Balance of the Offered Certificates.

      

      Principal
        Prepayment:
        Any
        payment of principal by a Mortgagor on a Mortgage Loan that is received in
        advance of its scheduled Due Date and is not accompanied by an amount
        representing scheduled interest due on any date or dates in any month or
        months
        subsequent to the month of prepayment. Partial Principal Prepayments shall
        be
        applied by the Servicer in accordance with the terms of the related Mortgage
        Note.

      

      Principal
        Prepayment in Full:
        Any
        Principal Prepayment made by a Mortgagor of the entire principal balance
        of a
        Mortgage Loan.

      

      Private
        Certificates:
        Any
        Class OC, Class P or Class R Certificate.

      

      Projected
        Net Liquidation Value:
        With
        respect to any Nonrecoverable Mortgage Loan, the amount, set forth in an
        Officer’s Certificate signed by a Servicing Officer in a form acceptable to the
        Trustee, equal to (i) the fair market value of the related Mortgaged Property
        as
        determined by a real estate broker meeting the qualifications, and applying
        broker’s price opinion methodology generally acceptable to, residential mortgage
        servicers, or other property valuation opinion methodology customarily used
        by
        residential mortgage servicers with respect to defaulted loans, less (ii)
        the
        Servicer’s good faith estimate of the total of all related costs of liquidation,
        Servicing Fees, and Advances reasonably expected to be incurred in the event
        the
        Mortgaged Property were the subject of foreclosure or otherwise converted
        to,
        and sold as, REO Property.

      

      
        
          
          

        

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

      

      PUD:
        Planned
        Unit Development.

      

      Purchase
        Price:
        With
        respect to any Mortgage Loan, an amount equal to the sum of (i) 100% of the
        unpaid principal balance of such Mortgage Loan on the date of such purchase,
        (ii) accrued interest thereon at the applicable Mortgage Rate from the date
        through which interest was last paid by the Mortgagor to the Due Date occurring
        in the Due Period immediately preceding the Distribution Date on which the
        Purchase Price is to be distributed to Certificateholders and (iii) any costs
        and damages incurred by the Trust in connection with any violation by such
        Mortgage Loan of any predatory- or abusive-lending law.

      

      Rating
        Agency:
        Each of
        S&P and Moody’s. If any such organization or a successor is no longer in
        existence, “Rating Agency” shall be such nationally recognized statistical
        rating organization, or other comparable Person, as is designated by the
        Depositor, notice of which designation shall be given to the Trustee. References
        herein to a given rating category of a Rating Agency shall mean such rating
        category without giving effect to any modifiers.

      

      Realized
        Loss:
        With
        respect to any Distribution Date and any Mortgage Loan (other than a
        Nonrecoverable Mortgage Loan) that became a Liquidated Loan during the related
        Prepayment Period will be the sum of (i) the principal balance of such Mortgage
        Loan remaining outstanding (after all recoveries of principal have been applied
        thereto) and the principal portion of P&I Advances made by the Servicer with
        respect to such Mortgage Loan which have been reimbursed from Liquidation
        Proceeds, and (ii) the accrued interest on such Mortgage Loan remaining unpaid
        and the interest portion of P&I Advances made by the Servicer with respect
        to such Mortgage Loan which have been reimbursed from Liquidation Proceeds.
        The
        amounts set forth in clause (i) are the principal portion of Realized Losses
        and
        the amounts set forth in clause (ii) are the interest portion of Realized
        Losses. With respect to any Mortgage Loan that is not a Liquidated Loan,
        the
        amount of any Debt Service Reduction or Deficient Valuation incurred with
        respect to such Mortgage Loan as of the related Due Date will be treated
        as a
        Realized Loss. With respect to any Nonrecoverable Mortgage Loan, the sum
        of (i)
        the amount by which the unpaid principal balance thereof exceeds the Projected
        Net Liquidation Value thereof and (ii) the amount, if any, by which the
        Projected Net Liquidation Value thereof exceeds Liquidation Proceeds received
        in
        respect thereof. The Realized Loss in respect of any Nonrecoverable Mortgage
        Loan calculated pursuant to clause (i) of the preceding sentence shall be
        given
        effect as of the Prepayment Period during which the Servicer classifies such
        loan as a Nonrecoverable Mortgage Loan.

      

      
        
          
          

        

        
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      Recognition
        Agreement:
        With
        respect to any Cooperative Loan, an agreement between the Cooperative
        Corporation and the originator of such Mortgage Loan which establishes the
        rights of such originator in the Cooperative Property.

      

      Record
        Date:
        The
        close of business on the Business Day immediately preceding such Distribution
        Date.

      

      Reference
        Bank:
        Leading
        banks selected by the Servicer and engaged in transactions in U.S. dollar
        deposits in the London interbank market.

      

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

      

      Regular
        Certificates:
        Any of
        the Offered Certificates and the Class OC Certificates.

      

      Regulation
        AB:
        Regulation AB promulgated under the Securities Act and the Exchange Act,
        as the
        same may be amended from time to time; and all references to any rule, item,
        section or subsection of, or definition or term contained in, Regulation
        AB mean
        such rule, item, section, subsection, definition or term, as the case may
        be, or
        any successor thereto, in each case as the same may be amended from time
        to
        time.

      

      Relief
        Act:
        The
        Servicemembers’ Civil Relief Act, as amended.

      

      Relief
        Act Interest Shortfall:
        For any
        Distribution Date and a Mortgage Loan will be the reduction in the amount
        of
        interest collectible on such Mortgage Loan for the most recently ended calendar
        month immediately preceding the related Distribution Date as a result of
        the
        application of the Relief Act or similar state laws.

      

      REMIC:
        A “real
        estate mortgage investment conduit” within the meaning of section 860D of the
        Code.

      

      REMIC
        Change of Law:
        Any
        proposed, temporary or final regulation, revenue ruling, revenue procedure
        or
        other official announcement or interpretation relating to REMICs and the
        REMIC
        Provisions issued after the Closing Date.

      

      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 regulations promulgated
        thereunder, as the foregoing may be in effect from time to time.

      

      Remittance
        Agency Agreement:
        As
        defined in Section 2.2 hereof.

      

      REO
        Disposition:
        The
        final sale by the applicable Servicer of any REO Property.

      

      REO
        Property:
        A
        Mortgaged Property acquired by the Trust Fund through foreclosure or
        deed-in-lieu of foreclosure in connection with a defaulted Mortgage
        Loan.

      

      
        
          
          

        

        
          34

          
            

          

        

        
          
          

        

      

      Replacement
        Swap Provider Payment:
        Any
        payments that have been received by the Trust as a result of entering into
        a
        replacement interest rate swap agreement.

      

      Request
        for Release:
        The
        Request for Release submitted by the Servicer to the Trustee, substantially
        in
        the form of Exhibit I.

      

      Required
        Recordation States:
        The
        states of Florida and Mississippi.

      

      Residual
        Certificates:
        The
        Class R Certificates.

      

      Responsible
        Officer:
        When
        used with respect to the Trustee, any Vice President, any Assistant Vice
        President, the Secretary, any Assistant Secretary, Managing Director, Director,
        Associate or any other officer of the Trustee customarily performing functions
        similar to those performed by any of the above designated officers and having
        direct responsibility for the administration of this Agreement and also to
        whom,
        with respect to a particular matter, such matter is referred because of such
        officer’s knowledge of and familiarity with the particular subject.

      

      Sales
        Agreement:
        The
        Sales Agreement between the Depositor and Saxon Funding Management LLC regarding
        the sale of the Mortgage Loans, dated as of the Closing Date.

      

      S&P:
        Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies,
        Inc. If S&P is designated as a Rating Agency in the Preliminary Statement,
        the address for notices to S&P shall be Standard & Poor’s Ratings
        Services, 26 Broadway, 15th Floor, New York, New York 10004, Attention: Mortgage
        Surveillance Monitoring, or such other address as S&P may hereafter furnish
        to the Depositor and the Servicer.

      

      Scheduled
        Notional Amount:
        For any
        Distribution Date and the Swap Agreement, the notional amount with respect
        to
        which payments under the Swap Agreement will be calculated. 

      

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

      

      SEC
        Rules:
        Any
        rules promulgated by the Commission, and any interpretations thereof by the
        staff of the Commission.

      

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

      

      Security
        Release Certification:
        As
        defined in Section 2.2 hereof.

      

      Seller:
        SFM.

      

      Senior
        Certificates:
        The
        Group 1 Senior Certificates and the Group 2 Senior Certificates.

      

      Senior
        Enhancement Percentage:
        For any
        Distribution Date, the percentage obtained by dividing (x) the aggregate
        Class
        Principal Balance of the Subordinate Certificates (together with the
        Overcollateralized Amount and taking into account the distributions of the
        Principal Distribution Amount and all payments of principal from the Swap
        Account, if any, for such Distribution Date) by (y) the aggregate principal
        balance of the mortgage loans as of the last day of the related Due
        Period.

      

      
        
          
          

        

        
          35

          
            

          

        

        
          
          

        

      

      Senior
        Interest Distribution Amount:
        With
        respect to any Class of Senior Certificates and any Distribution Date, interest
        accrued during the related Interest Accrual Period on the related Class
        Principal Balance of that Class immediately prior to the Distribution Date
        at
        the Pass-Through Rate for that Class reduced (to an amount not less than
        zero),
        in the case of such Class, by the allocable share, if any, for that Class
        of
        Prepayment Interest Shortfalls to the extent not covered by Compensating
        Interest paid by the Servicer and Relief Act Interest Shortfalls, together
        with
        the Interest Carry Forward Amount, if any, for such Distribution Date for
        such
        Class of Senior Certificates.

      

      Senior
        Principal Distribution Amount:
        With
        respect to the Senior Certificates and any Distribution Date (i) prior to
        the
        Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect,
        the Principal Distribution Amount or (ii) on or after the Stepdown Date if
        a
        Trigger Event is not in effect for the Offered Certificates for that
        Distribution Date, the lesser of: 

      

      
        	 	
                (i)

              	
                the
                  Principal Distribution Amount for that Distribution Date; and
                  

              

      

      

      
        	 	
                (ii)

              	
                the
                  excess (if any) of (A) the aggregate Class Principal Balance of
                  the Senior
                  Certificates immediately prior to that Distribution Date over (B)
                  the
                  lesser of (i) the aggregate Stated Principal Balance of the mortgage
                  loans
                  as of the last day of the related Due Period multiplied by approximately
                  50.20% and (ii) the amount, if any, by which (x) the aggregate
                  Stated
                  Principal Balance of the Mortgage Loans as of the last day of the
                  related
                  Due Period exceeds (y) the Overcollateralization
                  Floor.

              

      

      

      Servicer:
        Saxon
        Mortgage Services, Inc. and its permitted successors and assigns.

      

      Servicing
        Advances:
        All
        customary, reasonable and necessary “out of pocket” costs and expenses incurred
        in the performance by the Servicer of its servicing obligations hereunder,
        including, but not limited to, the cost of (i) the preservation, restoration
        and
        protection of a Mortgaged Property, (ii) any expenses reimbursable to the
        Servicer pursuant to Section 3.11 and any enforcement or judicial proceedings,
        including foreclosures, (iii) the management and liquidation of any REO Property
        (including reasonable fees paid to any independent contractor in connection
        therewith) and (iv) compliance with the obligations under Section 3.1 and
        Section 3.9.

      

      Servicing
        Criteria:
        The
“servicing criteria” set forth in Item 1122(d) of Regulation AB, as such may be
        amended from time to time.

      

      Servicing
        Fee:
        As to
        each Mortgage Loan and any Distribution Date, an amount payable out of each
        full
        payment of interest received on such Mortgage Loan and equal to one-twelfth
        of
        the Servicing Fee Rate multiplied by the Stated Principal Balance of such
        Mortgage Loan as of the Due Date in the month prior to the month of such
        Distribution Date (or, in the case of an Odd Due Date Mortgage Loan, the
        Due
        Date occurring in the second month preceding the month of such Distribution
        Date).

      

      
        
          
          

        

        
          36

          
            

          

        

        
          
          

        

      

      Servicing
        Fee Rate:
        0.50%
        per annum.

      

      Servicing
        Officer:
        Any of
        the President, any Vice President (however denominated), or Assistant Vice
        President of the Servicer involved in, or responsible for, the administration
        and servicing of one or more Mortgage Loans at the time of performance of
        the
        relevant activity of the Servicer.

      

      SFM:
        Saxon
        Funding Management LLC, and its successor and assigns.

      

      SMS:
        Saxon
        Mortgage Services, Inc., a Texas corporation.

      

      Startup
        Day:
        The
        Closing Date.

      

      Stated
        Principal Balance:
        For any
        Mortgage Loan and Due Date, the unpaid principal balance of the Mortgage
        Loan as
        of that Due Date, as specified in its amortization schedule at that time
        (before
        any adjustment to the amortization schedule for any moratorium or similar
        waiver
        or grace period), after giving effect to (i) the payment of principal due
        on
        that Due Date, irrespective of any delinquency in payment by the related
        mortgagor, and (ii) prepayments of principal and the principal portion of
        Liquidation Proceeds received with respect to that mortgage loan through
        the
        last day of the related Prepayment Period.

      

      Stepdown
        Date:
        With
        respect to the Certificates, the later
        to occur
        of:

      

      
        	 	
                (1)

              	
                the
                  earlier
                  to
                  occur of 

              

      

      

      (x) the
        Distribution Date in March 2010, and 

      

      (y) the
        Distribution Date immediately following the Distribution Date on which the
        aggregate Class Principal Balance of the Senior Certificates is reduced to
        zero;
        and

      

      (2) the
        first
        Distribution Date on which the Senior Enhancement Percentage (calculated
        for
        this purpose only after taking into account distributions of principal on
        the
        Mortgage Loans, but prior to any distribution of the Principal Distribution
        Amount to the holders of the Offered Certificates then entitled to distributions
        of principal on the Distribution Date) is greater than or equal to approximately
        49.80%.

      

      Subcontractor:
        Any
        vendor, subcontractor or other Person that is not responsible for the overall
        servicing (as “servicing” is commonly understood by participants in the
        mortgage-backed securities market) of Mortgage Loans but performs one or
        more
        discrete functions identified in Item 1122(d) of Regulation AB with respect
        to
        Mortgage Loans under the direction or authority of the Servicer or a
        Subservicer.

      

      Subordinate
        Basis Risk Carry Forward Amount:
        With
        respect to any Class of Subordinate Certificates and any Distribution Date,
        an
        amount equal to the sum of (i) the excess, if any, of (x) the amount of interest
        such Class of Subordinate Certificates would have been entitled to receive
        on
        such Distribution Date if the Aggregate Net WAC Cap had not been applicable
        to
        such Class on such Distribution Date over (y) the amount of interest accrued
        on
        such Distribution Date at the Aggregate Net WAC Cap and (ii) the related
        Basis
        Risk Carry Forward Amount for previous Distribution Dates not previously
        distributed together with interest thereon at a rate equal to the related
        Pass-Through Rate for such Class of Subordinate Certificates for the most
        recently ended Interest Accrual Period.

      

      
        
          
          

        

        
          37

          
            

          

        

        
          
          

        

      

      Subordinate
        Certificates:
        The
        Class M Certificates and the Class B Certificates.

      

      Subordinate
        Interest Distribution Amount:
        With
        respect to any Class of Subordinate Certificates and any Distribution Date,
        interest accrued during the related Interest Accrual Period on the related
        Class
        Principal Balance of that Class immediately prior to the Distribution Date
        at
        the Pass-Through Rate for that Class reduced (to an amount not less than
        zero),
        in the case of such Class, by the allocable share, if any, for that Class
        of
        Prepayment Interest Shortfalls to the extent not covered by Compensating
        Interest paid by the Servicer and Relief Act Interest Shortfalls.

      

      Subservicer:
        Any
        Person that services Mortgage Loans on behalf of the Servicer or any
        Subservicer, performing the substantial majority of the material functions
        required to be performed by the Servicer under this Agreement that are
        identified in Item 1122(d) of Regulation AB.

      

      Subservicing
        Agreement:
        Any
        written contract for the subservicing of the Mortgage Loans between the Servicer
        and a Subservicer.

      

      Subsequent
        Recoveries:
        With
        respect to any Mortgage Loan other than a Nonrecoverable Mortgage Loan,
        unexpected recoveries, net of reimbursable expenses, received by the Servicer
        and remitted by it to the Trustee, with respect to a Liquidated Mortgage
        Loan
        that resulted in a Realized Loss in a month prior to the month of receipt
        of
        such recoveries. As to any Nonrecoverable Mortgage Loan, the excess of (i)
        any
        net Liquidation Proceeds received in respect of such loan; over (ii) the
        Projected Net Liquidation Value thereof.

      

      Substitute
        Mortgage Loan:
        A
        Mortgage Loan substituted by the Depositor or Servicer for a Deleted Mortgage
        Loan which must, on the date of such substitution, as confirmed in a Request
        for
        Release, substantially in the form of Exhibit I, (i) have a Stated Principal
        Balance, after deduction of the principal portion of the Scheduled Payment
        due
        in the month of substitution, not in excess of, and not more than 10% less
        than
        the Stated Principal Balance of the Deleted Mortgage Loan; (ii) accrue interest
        on the same basis as the Deleted Mortgage Loan and be accruing interest at
        a
        rate no lower than and not more than 1% per annum higher than, that of the
        Deleted Mortgage Loan; (iii) have a Loan-to-Value Ratio no higher than that
        of
        the Deleted Mortgage Loan; (iv) not be a Cooperative Loan unless the Deleted
        Mortgage Loan was a Cooperative Loan; (v) be covered by a Primary Mortgage
        Insurance Policy if the Deleted Mortgage Loan was so covered; and (vi) comply
        with each representation and warranty set forth in Section 2.3 hereof. Any
        of
        the characteristics described above may be satisfied in the aggregate by
        one or
        more Substitute Mortgage Loans.

      

      
        
          
          

        

        
          38

          
            

          

        

        
          
          

        

      

      Substitution
        Adjustment Amount:
        The
        meaning ascribed to such term pursuant to Section 2.3 hereof.

      

      Supplemental
        Interest Trust:
        The
        corpus of a trust created pursuant to Section 4.8 of this Agreement and
        designated as the “Supplemental Interest Trust” or the “Saxon Asset Securities
        2007-1 Supplemental Interest Trust,” consisting of the Swap Agreement, the Swap
        Account, the Cap Agreement and the Excess Reserve Fund Account.

      

      Swap
        Account:
        The
        meaning ascribed to such term pursuant to Section 4.8 hereof.

      

      Swap
        Agreement:
        The
        interest rate swap agreement documented pursuant to the 1992 ISDA Master
        Agreement, together with a schedule, credit support annex and confirmation,
        between the Trustee, on behalf of the Supplemental Interest Trust, and the
        Swap
        Counterparty attached hereto as Exhibit Q.

      

      Swap
        Counterparty:
        Morgan
        Stanley Capital Services Inc.
        and any
        permitted successor thereto.

      

      Swap
        Payment Allocation:
        For any
        Class of Certificates and any Distribution Date, that Class’s pro rata share of
        the Net Swap Receipts, if any, for that Distribution Date, based on the Class
        Principal Balances at the beginning of the related Due Period of the Classes
        of
        Certificates.

      

      Swap
        Payment Rate:
        With
        respect to any Distribution Date, a per annum rate equal to the quotient
        of (i)
        the product of (a) Net Swap Payment of Swap Termination Payment (other than
        a
        Defaulted Swap Termination Payment) owed to the Swap Counterparty for such
        Distribution Date multiplied by (b) 12, divided by (ii) the aggregate of
        the
        Stated Principal Balances of the Mortgage Loans as of the first day of the
        related Due Period, adjusted to reflect prepayments received after the first
        Day
        of the related Due Period that were distributed on the immediately preceding
        Distribution Date.

      

      Swap
        Termination Payment:
        Any
        payment payable by the Trust or the Swap Counterparty upon termination of
        the
        Swap Agreement as a result of an Event of Default (as defined in the Swap
        Agreement) or a Termination Event (as defined in the Swap Agreement);
provided that
        a Swap
        Termination Payment shall not include any such amount to the extent already
        received by the Swap Counterparty as a Replacement Swap Provider
        Payment.

      

      Telerate
        Page 3750:
        The
        display page currently so designated on the Bridge Telerate Market Report
        (or
        such other page as may replace that page on that service for the purpose
        of
        displaying comparable rates or prices).

      

      Transfer:
        Any
        direct or indirect transfer or sale of any Ownership Interest in a Residual
        Certificate.

      

      Three
        Month Rolling Average:
        With
        respect to the Mortgage Loans and the end of the Due Period related to any
        Distribution Date, the rolling 3 month average percentage of the aggregate
        Stated Principal Balance of the Mortgage Loans that are 60 or more days
        delinquent (including mortgage loans in foreclosure, REO Properties and mortgage
        loans discharged in bankruptcy).

      

      
        
          
          

        

        
          39

          
            

          

        

        
          
          

        

      

      Trigger
        Event:
        either
        a Cumulative Loss Trigger Event or a Delinquency Loss Trigger
        Event.

      

      Trustee:
        Deutsche Bank National Trust Company and its successors and, if a successor
        trustee is appointed hereunder, such successor.

      

      Trustee
        Fee:
        As to
        any Distribution Date, an amount equal to one-twelfth of the Trustee Fee
        Rate
        multiplied by the Stated Principal Balance with respect to such Distribution
        Date.

      

      Trustee
        Fee Rate:
        0.0057%
        per annum.

      

      Trust
        Fund:
        As
        described in Section 2.1 hereof.

      

      Underwriter:
        Morgan
        Stanley & Co. Incorporated.

      

      Underwriter’s
        Exemption:
        Prohibited Transaction Exemption 2002-41, 67 Fed. Reg. 54487 (2002), as amended
        (or any successor thereto), or any substantially similar administrative
        exemption granted by the U.S. Department of Labor.

      

      Underwritten
        Certificates:
        The
        Certificates purchased by the Underwriter pursuant to the Underwriting Agreement
        by and among SFM, Saxon Asset Securities Company and the
        Underwriter.

      

      Unpaid
        Interest Shortfall Amount
        For any
        Class of Offered Certificates, the sum of Relief Act Interest Shortfalls
        and net
        prepayment interest shortfalls on the mortgage loans allocated to such Class
        of
        Offered Certificates on that Distribution Date and such amounts from any
        prior
        Distribution Date remaining unpaid.

      

      Unpaid
        Realized Loss Amount
        For any
        Class of Certificates, the portion of any Realized Losses previously allocated
        to that Class remaining unpaid from prior Distribution Dates.

      

      Upper-Tier
        REMIC:
        REMIC
        3.

      

      Voting
        Rights:
        The
        voting rights of the trust will be allocated as follows: 

      

      
        	
                (i)

              	
                1%
                  to each of the Class OC, Class P and Class R Certificates;
                  and

              

      

      

      (ii) the
        remainder to the Classes of Offered Certificates in proportion to their
        respective outstanding Class Principal Balances.

      

      ARTICLE
        2

      

      CONVEYANCE
        OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES

      

      
        	 	
                Section
                  2.1

              	
                Conveyance
                  of Mortgage Loans.

              

      

      

      
        	 	
                (a)

              	
                To
                  provide for the distribution of the principal of and interest on
                  the
                  Certificates in accordance with their terms, the distribution of
                  all other
                  sums distributable hereunder with respect to the Certificates and
                  the
                  performance of the covenants contained herein, the Depositor hereby
                  bargains, sells, conveys, assigns and transfers to the Trustee,
                  in trust,
                  without recourse and for the exclusive benefit of the Certificateholders
                  as their interests may appear, all the Depositor’s right, title and
                  interest in and to any and all benefits accruing to the Depositor
                  from:
                  (i) the Mortgage Loans, which the Depositor is causing to be
                  delivered to the Trustee (or the Custodian) herewith (and all Substitute
                  Mortgage Loans substituted therefor), together in each case with
                  the
                  related Mortgage Files and the Depositor’s interest in any collateral that
                  secured a Mortgage Loan but that is acquired by foreclosure or
                  deed-in-lieu of foreclosure after the Closing Date, and all Scheduled
                  Payments due after the Cut-off Date and all principal prepayments
                  received
                  with respect to the Mortgage Loans paid by the borrower after the
                  Cut-off
                  Date and proceeds of the conversion, voluntary or involuntary,
                  of the
                  foregoing; (ii) the Sales Agreement; (iii)  the Swap
                  Agreement, (iv) the Cap Agreement; and (v) all proceeds of any
                  of the foregoing (including, but not limited to, all proceeds of
                  any
                  mortgage insurance, hazard insurance, or title insurance policy
                  relating
                  to the Mortgage Loans, cash proceeds, accounts, accounts receivable,
                  notes, drafts, acceptances, chattel paper, checks, deposit accounts,
                  rights to payment of any and every kind, and other forms of obligations
                  and receivables, which at any time constitute all or part or are
                  included
                  in the proceeds of any of the foregoing) to pay the Certificates
                  as
                  specified herein (items (i) through (v) above collectively, the
                  “Trust Fund”). The Trustee is hereby authorized to enter into the Cap
                  Agreement and the Swap Agreement on behalf of the Supplemental
                  Interest
                  Trust.

              

      

      

      
        
          
          

        

        
          40

          
            

          

        

        
          
          

        

      

      
        	 	
                (b)

              	
                In
                  connection with the transfer set forth in clause (a) above, the
                  Depositor
                  has delivered or caused to be delivered to the Trustee or the Custodian
                  on
                  its behalf for the benefit of the Certificateholders the following
                  documents or instruments (collectively, the “Mortgage Loan Documents”)
                  with respect to each Mortgage Loan so
                  transferred:

              

      

      

      (i) (A)
        the
        original Mortgage Note endorsed by manual or facsimile signature to the Trustee
        or the Custodian or in blank, without recourse, with all intervening
        endorsements showing a complete chain of endorsement from the originator
        to the
        Person endorsing the Mortgage Note (the “Last Endorsee”) (each such endorsement
        being sufficient to transfer all right, title and interest of the party so
        endorsing, as noteholder or assignee thereof, in and to that Mortgage Note);
        or

      

      (B)
        with
        respect to any Lost Mortgage Note, a lost note affidavit from the Depositor
        stating that the original Mortgage Note was lost or destroyed, together with
        a
        copy of such Mortgage Note;

      

      (ii) except
        with respect to any Cooperative Loan, the original recorded Mortgage or a
        copy
        of such Mortgage certified by the Depositor, the originating lender, settlement
        agent, or escrow company as being a true and complete copy of the
        Mortgage;

      

      
        
          
          

        

        
          41

          
            

          

        

        
          
          

        

      

      (iii) except
        with respect to any Mortgage Loan for which the related Mortgage names the
        Custodian as nominee for the originating lender (or similar designation
        satisfactory to the Custodian), as beneficiary or mortgagee, either (A) a
        duly
        executed assignment of the Mortgage in blank, or (B) an original recorded
        assignment of the Mortgage from the Last Endorsee to the Custodian or a copy
        of
        such assignment of Mortgage certified by the Depositor, the originating lender,
        settlement agent, or escrow company as being a true and complete copy thereof
        which in either case may be included in a blanket assignment or assignments;
        

      

      (iv) each
        interim recorded assignment of such Mortgage, or a copy of each such interim
        recorded assignment of Mortgage certified by the Depositor, the originating
        lender, settlement agent, or escrow company as being a true and complete
        copy
        thereof; 

      

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

      

      (vi) except
        as
        to any second lien Mortgage Loan in the original principal amount of $50,000.00
        or less, either the original or duplicate original title policy (including
        all
        riders thereto) with respect to the related Mortgaged Property, if available,
        provided that the title policy (including all riders thereto) will be delivered
        as soon as it becomes available, and if the title policy is not available,
        and
        to the extent required pursuant to the second paragraph below or otherwise
        in
        connection with the rating of the Certificates, a written commitment or interim
        binder or preliminary report of the title issued by the title insurance or
        escrow company with respect to the Mortgaged Property; and

      

      (vii) in
        the
        case of a Cooperative Loan, the originals of the following documents or
        instruments:

      

      
        	 	
                (a)

              	
                The
                  Coop Shares, together with a stock power in
                  blank;

              

      

      

      
        	 	
                (b)

              	
                The
                  executed Security Agreement;

              

      

      

      
        	 	
                (c)

              	
                The
                  executed Proprietary Lease;

              

      

      

      
        	 	
                (d)

              	
                The
                  executed Recognition Agreement;

              

      

      

      
        	 	
                (e)

              	
                The
                  executed UCC1 financing statement with evidence of recording thereon
                  which
                  have been filed in all places required to perfect the Depositor’s interest
                  in the Coop Shares and the Proprietary Lease;
                  and

              

      

      

      
        	 	
                (f)

              	
                Executed
                  UCC3 financing statements or other appropriate UCC financing statements
                  required by state law, evidencing a complete and unbroken line
                  from the
                  mortgagee to the Trustee with evidence of recording thereon (or
                  in a form
                  suitable for recordation).

              

      

      

      (viii) the
        original Primary Mortgage Insurance Policy or certificate or, an electronic
        certification evidencing the existence of the Primary Mortgage Insurance
        Policy
        or certificate, if private mortgage guaranty insurance is required;

      

      
        
          
          

        

        
          42

          
            

          

        

        
          
          

        

      

      In
        the
        event that in connection with any Mortgage Loan the Depositor cannot deliver
        (a)
        the original recorded Mortgage or (b) any recorded assignments or interim
        assignments satisfying the requirements of clause (iii) or (iv) above,
        respectively, concurrently with the execution and delivery hereof because
        such
        document or documents have not been returned from the applicable public
        recording office, the Depositor shall deliver such documents to the Trustee
        or
        the Custodian on its behalf as promptly as possible upon receipt thereof
        and, in
        any event, within 720 days following the Closing Date. The Depositor or Servicer
        shall forward or cause to be forwarded to the Trustee or the Custodian on
        its
        behalf (a) from time to time additional original documents evidencing an
        assumption or modification of a Mortgage Loan and (b) any other documents
        required to be delivered by the Depositor or the Servicer to the Trustee.
        In the
        case where a public recording office retains the original recorded Mortgage
        or
        in the case where a Mortgage is lost after recordation in a public recording
        office, the Depositor shall deliver to the Trustee a copy of such Mortgage
        certified (to the extent such certification is reasonably obtainable) by
        such
        public recording office to be a true and complete copy of the original recorded
        Mortgage.

      

      In
        addition, in the event that in connection with any Mortgage Loan the Depositor
        cannot deliver the original or duplicate original lender’s title policy
        (together with all riders thereto), satisfying the requirements of clause
        (vi)
        above, concurrently with the execution and delivery hereof because the related
        Mortgage or a related assignment has not been returned from the applicable
        public recording office, the Depositor shall promptly deliver to the Trustee
        or
        the Custodian on its behalf such original or duplicate original lender’s title
        policy (together with all riders thereto) upon receipt thereof from the
        applicable title insurer, and in any event, within 720 days following the
        Closing Date. 

      

      Subject
        to the immediately following sentence, as promptly as practicable subsequent
        to
        the transfer set forth in clause (a) of this Section 2.1, and in any event,
        within thirty (30) days thereafter, the Servicer shall as to any Mortgage
        Loan
        with respect to which the Depositor delivers an assignment of the Mortgage
        in
        blank pursuant to clause (b)(iii)(A) of this Section 2.1, (i) complete each such
        assignment of Mortgage to conform to clause (b)(iii)(B) of this Section 2.1,
        (ii) cause such assignment to be in proper form for recording in the appropriate
        public office for real property records, and (iii) cause to be delivered
        for
        recording in the appropriate public office for real property records each
        such
        assignment of the Mortgages, except that, with respect to any assignments
        of
        Mortgage as to which the Servicer has not received the information required
        to
        prepare such assignments in recordable form, the Servicer’s obligation to do so
        and to deliver the same for such recording shall be as soon as practicable
        after
        receipt of such information and in any event within thirty (30) days after
        receipt thereof. Notwithstanding the foregoing, the Servicer need not cause
        to
        be recorded any assignment which relates to a Mortgage Loan in any state
        other
        than the Required Recordation States; however
        with
        respect to each MERS Mortgage Loan, the Servicer, at the expense of the
        Depositor, shall take such actions as are necessary to cause the Trustee
        to be
        clearly identified as the owner of each such Mortgage Loan on the record
        of MERS
        for purposes of the system of recording transfers of beneficial ownership
        of
        mortgages maintained by MERS.

      

      In
        the
        case of Mortgage Loans that have been prepaid in full as of the Closing Date,
        the Depositor, in lieu of delivering the above documents to the Trustee or
        the
        Custodian on its behalf, will deposit in the Collection Account the portion
        of
        such payment that is required to be deposited in the Collection Account pursuant
        to Section 3.8 hereof.

      

      
        
          
          

        

        
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                (c)

              	
                It
                  is agreed and understood by the Depositor (and the Depositor so
                  represents
                  and recognizes) that it is not intended that any Mortgage Loan
                  to be
                  included in the Trust Fund be (i) a “High-Cost Home Loan” as defined in
                  the New Jersey Home Ownership Act effective November 27, 2003,
                  (ii) a
                  “High-Cost Home Loan” as defined in the New Mexico Home Loan Protection
                  Act effective January 1, 2004, (iii) a
                  “High-Cost Home Mortgage Loan” as defined in the Massachusetts Predatory
                  Home Loan Practices Act effective November 7, 2004 or (iv) a “High Cost
                  Home Loan” as defined in the Indiana Home Loan Practices Act effective
                  January 1, 2005.
                  

              

      

      

      Section
        2.2 Acceptance
        by Trustee of the Mortgage Loans.

      

      The
        Trustee or the Custodian, on behalf of the Trustee acknowledges receipt of
        the
        documents identified in the initial certification in the form annexed hereto
        as
        Exhibit C (the “Initial Certification”) and declares that it or the Custodian
        holds and will hold such documents and the other documents delivered to it
        constituting the Mortgage Files, and that it or the Custodian holds or will
        hold
        such other assets as are included in the Trust Fund, in trust for the exclusive
        use and benefit of all present and future Certificateholders. 

      

      The
        Trustee agrees to execute and deliver or to cause the Custodian to execute
        and
        deliver on the Closing Date to the Depositor and the Servicer an Initial
        Certification in the form annexed hereto as Exhibit C. Based on its or the
        Custodian’s review and examination, and only as to the documents identified in
        such Initial Certification, the Custodian, on behalf of the Trustee acknowledges
        that such documents appear regular on their face and relate to such Mortgage
        Loan. Neither the Trustee nor the Custodian shall be under any duty or
        obligation to inspect, review or examine said documents, instruments,
        certificates or other papers to determine that the same are genuine, enforceable
        or appropriate for the represented purpose or that they have actually been
        recorded in the real estate records or that they are other than what they
        purport to be on their face.

      

      Not
        later
        than 360 days after the Closing Date, the Trustee shall deliver or shall
        cause
        the Custodian to deliver to the Depositor and the Servicer a Final Certification
        in the form annexed hereto as Exhibit D, with any applicable exceptions noted
        thereon. Notwithstanding anything to the contrary contained herein, in the
        event
        there are exceptions to the Final Certification, the Trustee may transmit
        such
        exceptions electronically (via email) to the Depositor and the Servicer,
        subject
        to the prior approval of the Depositor and the Servicer.

      

      If,
        in
        the course of such review, the Trustee or the Custodian, on behalf of the
        Trustee finds any document constituting a part of a Mortgage File which does
        not
        meet the requirements of Section 2.1 hereof (the “Mortgage Loan Document
        Requirements”), the Trustee shall list or shall cause the Custodian to list such
        as an exception in the Final Certification; provided, however that neither
        the
        Trustee nor the Custodian shall make any determination as to whether (i)
        any
        endorsement is sufficient to transfer all right, title and interest of the
        party
        so endorsing, as noteholder or assignee thereof, in and to that Mortgage
        Note or
        (ii) any assignment is in recordable form or is sufficient to effect the
        assignment of and transfer to the assignee thereof under the mortgage to
        which
        the assignment relates. SFM shall promptly correct or cure such defect within
        90
        days from the date it was so notified of such defect and, if SFM does not
        correct or cure such defect within such period, SFM shall either (a) substitute
        for the related Mortgage Loan a Substitute Mortgage Loan, which substitution
        shall be accomplished in the manner and subject to the conditions set forth
        in
        Section 2.3 hereof, or (b) purchase such Mortgage Loan from the Trustee within
        90 days from the date SFM was notified of such defect in writing at the Purchase
        Price of such Mortgage Loan; provided, however, that in no event shall such
        substitution or purchase occur more than 540 days from the Closing Date,
        except
        that if the substitution or purchase of a Mortgage Loan pursuant to this
        provision is required by reason of a delay in delivery of any documents by
        the
        appropriate recording office, and there is a dispute between either the Servicer
        or SFM and the Trustee over the location or status of the recorded document,
        then such substitution or purchase shall occur within 720 days from the Closing
        Date. Any such substitution pursuant to (a) above shall not be effected prior
        to
        the delivery to the Trustee of the Opinion of Counsel required by Section
        2.4
        hereof, if any, and any substitution pursuant to (a) above shall not be effected
        prior to the additional delivery to the Trustee of a Request for Release
        substantially in the form of Exhibit I. No substitution is permitted to be
        made
        in any calendar month after the Determination Date for such month. The Purchase
        Price for any such Mortgage Loan shall be deposited by SFM in the Collection
        Account on or prior to the Distribution Account Deposit Date for the
        Distribution Date in the month following the month of repurchase and, upon
        receipt of such deposit and certification with respect thereto in the form
        of
        Exhibit I hereto, the Trustee shall cause the Custodian to release the related
        Mortgage File to SFM and shall execute and deliver at SFM’s request such
        instruments of transfer or assignment prepared by SFM, in each case without
        recourse, as shall be necessary to vest in SFM, or a designee, the Trustee’s
        interest in any Mortgage Loan released pursuant hereto. 

      

      
        
          
          

        

        
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      As
        soon
        as practicable after the delivery of a Substitute Mortgage Loan under Section
        2.3 hereof, the Servicer, at the expense of the Depositor, shall (i) with
        respect to a Substitute Mortgage Loan that is a Non-MERS Mortgage Loan, cause
        the assignment of mortgage to be recorded by the Servicer if required pursuant
        to Section 2.1 hereof or (ii) with respect to a Substitute Mortgage Loan
        that is
        a MERS Mortgage Loan, cause to be taken such actions as are necessary to
        cause
        the Trustee to be clearly identified as the owner of each such Mortgage Loan
        on
        the records of MERS if required pursuant to Section 2.1 hereof.

      

      The
        Trustee shall retain or shall cause the Custodian to retain possession and
        custody of each Mortgage File in accordance with and subject to the terms
        and
        conditions set forth herein. The Servicer shall promptly deliver to the Trustee
        or the Custodian on its behalf, upon the execution or receipt thereof, the
        originals of such other documents or instruments constituting the Mortgage
        File
        as come into the possession of the Servicer from time to time.

      

      It
        is
        understood and agreed that the obligation of SFM to substitute for or to
        purchase any Mortgage Loan which does not meet the requirements of Section
        2.1
        hereof shall constitute the sole remedy respecting such defect available
        to the
        Trustee and any Certificateholder against the Depositor or SFM.

      

      In
        order
        to facilitate sales and deliveries of Mortgage Loans to the Trust Fund, the
        Trustee may execute and deliver one or more remittance agency agreements
        in
        substantially the form of Exhibit K hereto (each, a "Remittance Agency
        Agreement"), and in such event the Trustee: (i) shall perform the duties
        of
        Remittance Agent (as that term is defined in the related Remittance Agency
        Agreement); and (ii) may accept as conclusive evidence of the release of
        the
        related security interests one or more security release certifications in
        substantially the form attached as Exhibit L hereto (each, a "Security Release
        Certification").

      

      
        
          
          

        

        
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      Section
        2.3 Representations,
        Warranties and Covenants of the Depositor and the Servicer.

      

      (a) The
        Servicer represents and warrants to the Trustee and the Swap Counterparty
        that,
        as of the Closing Date:

      

      (i) the
        Servicer is a corporation licensed as a mortgage servicer duly organized,
        validly existing and in good standing under the laws of the state of its
        incorporation and has, and had at all relevant times, full corporate power
        to
        service the Mortgage Loans, to own its property, to carry on its business
        as
        presently conducted and to enter into and perform its obligations under this
        Agreement. The Servicer has all necessary licenses and is qualified to transact
        business in and is in good standing under the laws of each state where any
        Mortgaged Property is located or is otherwise exempt under applicable law
        from
        such qualification or is otherwise not required under applicable law to effect
        such qualification and no demand for such qualification has been made upon
        the
        Servicer by any state having jurisdiction;

      

      (ii) the
        execution and delivery of this Agreement by the Servicer and the performance
        by
        it of and compliance with the terms of this Agreement will not (A) violate
        the
        Servicer's articles of incorporation or by-laws or constitute a default (or
        an
        event which, with notice or lapse of time or both, would constitute a default)
        under, or result in the breach or acceleration of, any material contract,
        agreement or other instrument to which the Servicer is a party or which may
        be
        applicable to the Servicer or any of its assets or (B) result in the creation
        or
        imposition of any lien, charge or encumbrance upon any of its properties
        pursuant to the terms of any such contract, agreement or other
        instrument;

      

      (iii) the
        Servicer has the full power and authority to enter into and consummate all
        transactions contemplated by this Agreement to be consummated by it, has
        duly
        authorized the execution, delivery and performance of this Agreement, and
        has
        duly executed and delivered this Agreement. This Agreement, assuming due
        authorization, execution and delivery by the other parties hereto, constitutes
        a
        valid, legal and binding obligation of the Servicer, enforceable against
        it in
        accordance with the terms hereof, except as such enforcement may be limited
        by
        bankruptcy, insolvency, reorganization, receivership, moratorium or other
        similar laws relating to or affecting the rights of creditors generally,
        and by
        general equity principles (regardless of whether such enforcement is considered
        in a proceeding in equity or at law);

      

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

      

      
        
          
          

        

        
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      (v) there
        are
        no actions or proceedings against, or investigations of, the Servicer pending
        or, to the knowledge of the Servicer, threatened, before any court,
        administrative agency or other tribunal (A) that, if determined adversely,
        would
        prohibit its entering into this Agreement, (B) seeking to prevent the
        consummation of any of the transactions contemplated by this Agreement or
        (C)
        that, if determined adversely, would prohibit or materially and adversely
        affect
        the performance by the Servicer of any of its obligations under, or the validity
        or enforceability of, this Agreement.

      

      (b) The
        Depositor represents and warrants to the Trustee and the Swap Counterparty
        that,
        as of the Closing Date:

      

      (i) the
        Depositor is a corporation, duly organized, validly existing and in good
        standing under the laws of the state of its incorporation and has, and had
        at
        all relevant times, full corporate power to own its property, to carry on
        its
        business as presently conducted and to enter into and perform its obligations
        under this Agreement;

      

      (ii) the
        execution and delivery of this Agreement by the Depositor and the performance
        by
        it of and compliance with the terms of this Agreement will not (A) violate
        the
        Depositor's articles of incorporation or by-laws or constitute a default
        (or an
        event which, with notice or lapse of time or both, would constitute a default)
        under, or result in the breach or acceleration of, any material contract,
        agreement or other instrument to which the Depositor is a party or which
        may be
        applicable to the Depositor or any of its assets or (B) result in the creation
        or imposition of any lien, charge or encumbrance upon any of its properties
        pursuant to the terms of any such contract, agreement or other
        instrument;

      

      (iii) the
        Depositor has the full power and authority to enter into and consummate all
        transactions contemplated by this Agreement to be consummated by it, has
        duly
        authorized the execution, delivery and performance of this Agreement, and
        has
        duly executed and delivered this Agreement. This Agreement, assuming due
        authorization, execution and delivery by the other parties hereto, constitutes
        a
        valid, legal and binding obligation of the Depositor, enforceable against
        it in
        accordance with the terms hereof, except as such enforcement may be limited
        by
        bankruptcy, insolvency, reorganization, receivership, moratorium or other
        similar laws relating to or affecting the rights of creditors generally,
        and by
        general equity principles (regardless of whether such enforcement is considered
        in a proceeding in equity or at law);

      

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

      

      
        
          
          

        

        
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      (v) there
        are
        no actions or proceedings against, or investigations of, the Depositor pending
        or, to the knowledge of the Depositor, threatened, before any court,
        administrative agency or other tribunal (A) that, if determined adversely,
        would
        prohibit its entering into this Agreement, (B) seeking to prevent the
        consummation of any of the transactions contemplated by this Agreement or
        (C)
        that, if determined adversely, would prohibit or materially and adversely
        affect
        the performance by the Depositor of any of its obligations under, or the
        validity or enforceability of, this Agreement.

      

      (c) Pursuant
        to Section 2.1(a)(iii) hereof, the Depositor has assigned to the Trustee,
        for
        the benefit of Certificateholders, its rights under each Sales Agreement,
        including each representation and warranty applicable to the Mortgage Loans
        (and
        the applicable remedies) set forth in such Sales Agreement in respect of
        the
        Mortgage Loans. Each Sales Agreement provides remedies against SFM directly
        to
        the Depositor.

      

      Upon
        discovery by any of the parties hereto of a breach of a representation or
        warranty made by the Seller in respect of the Mortgage Loans that (i) materially
        and adversely affects the interests of the Certificateholders in any such
        Mortgage Loan or (ii) is set forth in subsections (B) or (C) of Exhibit B
        to the
        Sales Agreement between the Depositor and SFM, the party discovering such
        breach
        shall give prompt notice thereof to the other parties. SFM hereby covenants
        that
        within 90 days of the earlier of its discovery or its receipt of written
        notice
        from any party of a breach such of any representation or warranty which (x)
        materially and adversely affects the interests of the Certificateholders
        in any
        Mortgage Loan (it being understood that any such breach shall be deemed to
        materially and adversely affect the value of such Mortgage Loan or the interest
        of the Trust Fund therein, if the Trust Fund incurs a loss as the result
        of such
        breach) or (y) is set forth in subsections (B) or (C) of Exhibit B to the
        Sales
        Agreement between the Depositor and SFM, it shall cure such breach in all
        material respects, and if such breach is not so cured, shall, (i) if such
        90-day
        period expires prior to the second anniversary of the Closing Date, remove
        such
        Mortgage Loan (a “Deleted Mortgage Loan”) from the Trust Fund and substitute in
        its place a Substitute Mortgage Loan, in the manner and subject to the
        conditions set forth in this Section; or (ii) repurchase the affected Mortgage
        Loan or Mortgage Loans from the Trustee at the Purchase Price in the manner
        set
        forth below; provided, however, that any such substitution pursuant to (i)
        above
        shall not be effected prior to the delivery to the Trustee of the Opinion
        of
        Counsel required by Section 2.4(a) hereof, if any, and any such substitution
        pursuant to (i) above shall not be effected prior to the additional delivery
        to
        the Trustee or the Custodian on its behalf of a Request for Release
        substantially in the form of Exhibit I and the Mortgage File for any such
        Substitute Mortgage Loan. SFM shall promptly reimburse the Servicer and the
        Trustee for any expenses reasonably incurred by the Servicer or the Trustee
        in
        respect of enforcing the remedies against the Seller. With respect to the
        representations and warranties described in this Section which are made to the
        best of SFM’s knowledge, if it is discovered by either the Servicer or the
        Trustee that the substance of such representation and warranty is inaccurate
        (if
        required to impose the obligations described above on SFM) and such inaccuracy
        materially and adversely affects the value of the related Mortgage Loan or
        the
        interests of the Certificateholders therein, notwithstanding SFM’s lack of
        knowledge with respect to the substance of such representation or warranty,
        such
        inaccuracy shall be deemed a breach of the applicable representation or
        warranty.

      

      
        
          
          

        

        
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      With
        respect to any Substitute Mortgage Loan, SFM shall deliver to the Trustee
        or the
        Custodian on its behalf for the benefit of the Certificateholders the Mortgage
        Note, the Mortgage, the related assignment of the Mortgage, and such other
        documents and agreements as are required by Section 2.1, with the Mortgage
        Note
        endorsed and the Mortgage assigned as required by Section 2.1. No substitution
        is permitted to be made in any calendar month after the Determination Date
        for
        such month. Scheduled Payments due with respect to Substitute Mortgage Loans
        in
        the month of substitution shall not be part of the Trust Fund and will be
        retained by SFM on the next succeeding Distribution Date. For the month of
        substitution, distributions to Certificateholders will include the monthly
        payment due on any Deleted Mortgage Loan for such month and thereafter SFM
        shall
        be entitled to retain all amounts received in respect of such Deleted Mortgage
        Loan. The Servicer shall amend the Mortgage Loan Schedule for the benefit
        of the
        Certificateholders to reflect the removal of such Deleted Mortgage Loan and
        the
        substitution of the Substitute Mortgage Loan or Loans and the Servicer shall
        deliver the amended Mortgage Loan Schedule to the Trustee. Upon such
        substitution, the Substitute Mortgage Loan or Loans shall be subject to the
        terms of this Agreement in all respects, and SFM shall be deemed to have
        made
        with respect to such Substitute Mortgage Loan or Loans, as of the date of
        substitution, the representations and warranties made by SFM pursuant to
        the
        Sales Agreement with respect to such Mortgage Loan. Upon any such substitution
        and the deposit to the Collection Account of the amount required to be deposited
        therein in connection with such substitution as described in the following
        paragraph, the Trustee shall release or shall cause the Custodian to release
        the
        Mortgage File held for the benefit of the Certificateholders relating to
        such
        Deleted Mortgage Loan to SFM and shall execute and deliver at SFM’s direction
        such instruments of transfer or assignment prepared by SFM , in each case
        without recourse, as shall be necessary to vest title in SFM, or its designee,
        the Trustee’s interest in any Deleted Mortgage Loan substituted for pursuant to
        this Section 2.3.

      

      For
        any
        month in which SFM substitutes one or more Substitute Mortgage Loans for
        one or
        more Deleted Mortgage Loans, the Servicer will determine the amount (if any)
        by
        which the aggregate principal balance of all such Substitute Mortgage Loans
        as
        of the date of substitution is less than the aggregate Stated Principal Balance
        of all such Deleted Mortgage Loans (after application of the scheduled principal
        portion of the monthly payments due in the month of substitution). The amount
        of
        such shortage (the “Substitution Adjustment Amount”) plus an amount equal to the
        sum of (i) the aggregate of any unreimbursed Advances with respect to such
        Deleted Mortgage Loans and (ii) any costs and damages actually incurred and
        paid
        by or on behalf of the Trust in connection with any breach of the representation
        and warranty resulting from a violation of a predatory or abusive lending
        law
        applicable to such Mortgage Loan shall be deposited in the Collection Account
        by
        SFM on or before the Distribution Account Deposit Date for the Distribution
        Date
        in the month succeeding the calendar month during which the related Mortgage
        Loan became required to be purchased or replaced hereunder.

      

      In
        the
        event that SFM shall have repurchased a Mortgage Loan, the Purchase Price
        therefor shall be deposited in the Collection Account on or prior to the
        Distribution Account Deposit Date for the Distribution Date in the month
        following the month during which SFM became obligated hereunder to repurchase
        or
        replace such Mortgage Loan and upon such deposit of the Purchase Price, the
        delivery of the Opinion of Counsel required by Section 2.4 hereof and receipt
        of
        a Request for Release in the form of Exhibit I hereto, the Trustee shall
        release
        or shall cause the Custodian to release the related Mortgage File held for
        the
        benefit of the Certificateholders to SFM, and the Trustee shall execute and
        deliver or shall cause the Custodian to execute and deliver at SFM’s direction
        such instruments of transfer or assignment prepared by such Person, in each
        case
        without recourse, as shall be necessary to transfer title from the Trustee.
        It
        is understood and agreed that the obligation under this Agreement of each
        Seller
        to cure, repurchase or replace any Mortgage Loan as to which a breach has
        occurred and is continuing shall constitute the sole remedy respecting such
        breach available to Certificateholders or the Trustee on their
        behalf.

      

      
        
          
          

        

        
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      The
        representations and warranties made pursuant to this Section 2.3 (and the
        representations and warranties with respect to the Mortgage Loans made in
        each
        Sales Agreement) shall survive delivery of the respective Mortgage Files
        to the
        Trustee or the Custodian for the benefit of the Certificateholders.

      

      (d) Upon
        discovery by the Depositor, the Servicer or the Trustee that any Mortgage
        Loan
        does not constitute a “qualified mortgage” within the meaning of Section
        860G(a)(3) of the Code, the party discovering such fact shall promptly (and
        in
        any event within five (5) Business Days of discovery) give written notice
        thereof to the other parties. In connection therewith, the Trustee shall
        require
        SFM, at SFM’s option, to either (i) substitute, if the conditions in Section
        2.3(d) with respect to substitutions are satisfied, a Substitute Mortgage
        Loan
        for the affected Mortgage Loan, or (ii) repurchase the affected Mortgage
        Loan
        within 90 days of such discovery in the same manner as it would a Mortgage
        Loan
        for a breach of representation or warranty made pursuant to this Section
        2.3.
        The Trustee shall reconvey or shall cause the Custodian to reconvey to SFM
        the
        Mortgage Loan to be released pursuant hereto in the same manner, and on the
        same
        terms and conditions, as it would a Mortgage Loan repurchased for breach
        of a
        representation or warranty contained in this Section 2.3.

      

      Section
        2.4 Delivery
        of Opinion of Counsel in Connection with Substitutions.

      

      Notwithstanding
        any contrary provision of this Agreement, no substitution pursuant to Section
        2.2 or Section 2.3 shall be made more than 90 days after the Closing Date
        unless
        the Depositor or SFM delivers to the Trustee an Opinion of Counsel, which
        Opinion of Counsel shall not be at the expense of either the Trustee or the
        Trust Fund, addressed to the Trustee, to the effect that such substitution
        will
        not result in an Adverse REMIC Event.

      

      Section
        2.5 Execution
        and Delivery of Certificates.

      

      The
        Trustee acknowledges the transfer and assignment to it of the Trust Fund
        and,
        concurrently with such transfer and assignment, has executed and delivered
        to or
        upon the order of the Depositor, the Certificates in authorized denominations
        evidencing directly or indirectly the entire ownership of the Trust Fund.
        The
        Trustee agrees to hold the Trust Fund and exercise the rights referred to
        above
        for the benefit of all present and future Holders of the Certificates and
        to
        perform the duties set forth in this Agreement to the best of its ability,
        to
        the end that the interests of the Holders of the Certificates may be adequately
        and effectively protected.

      

      
        
          
          

        

        
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      ARTICLE
        3

      

      ADMINISTRATION
        AND SERVICING OF MORTGAGE LOANS

      

      Section
        3.1 Servicer
        to Service Mortgage Loans.

      

      For
        and
        on behalf of the Certificateholders, the Servicer shall service and administer
        the Mortgage Loans in accordance with the terms of this Agreement and customary
        and usual standards of practice of prudent mortgage loan servicers. In
        connection with such servicing and administration, the Servicer shall have
        full
        power and authority, acting alone and/or through Subservicers as provided
        in
        Section 3.2 hereof, to do or cause to be done any and all things that it
        may
        deem necessary or desirable in connection with such servicing and
        administration, including but not limited to, the power and authority, subject
        to the terms hereof (i) to execute and deliver, on behalf of the
        Certificateholders and the Trustee, customary consents or waivers and other
        instruments and documents, (ii) to consent to transfers of any Mortgaged
        Property and assumptions of the Mortgage Notes and related Mortgages (but
        only
        in the manner provided in this Agreement), (iii) to collect any Insurance
        Proceeds and other Liquidation Proceeds, and (iv) to effectuate foreclosure
        or
        other conversion of the ownership of the Mortgaged Property securing any
        Mortgage Loan; provided that the Servicer shall not take any action that
        is
        inconsistent with or prejudices the interests of the Trust Fund or the
        Certificateholders in any Mortgage Loan or the rights and interests of the
        Depositor, the Trustee and the Certificateholders under this Agreement. The
        Servicer shall represent and protect the interests of the Trust Fund in the
        same
        manner as it protects its own interests in mortgage loans in its own portfolio
        in any claim, proceeding or litigation regarding a Mortgage Loan, provided,
        however, that unless (x) the Mortgagor is in default with respect to the
        Mortgage Loan, or such default is, in the judgment of the Servicer, imminent
        or
        (y) in the absence of default or imminent default, any such waiver,
        modification, postponement or indulgence would not cause an Adverse REMIC
        Event,
        the Servicer may not permit any modification with respect to any Mortgage
        Loan.
        Without limiting the generality of the foregoing, the Servicer, in its own
        name
        or in the name of the Depositor and the Trustee, is hereby authorized and
        empowered by the Depositor and the Trustee, when the Servicer believes it
        appropriate in its reasonable judgment, to execute and deliver, on behalf
        of the
        Trustee, the Depositor, the Certificateholders or any of them, any and all
        instruments of satisfaction or cancellation, or of partial or full release
        or
        discharge and all other comparable instruments, with respect to the Mortgage
        Loans, and with respect to the Mortgaged Properties held for the benefit
        of the
        Certificateholders. The Servicer shall prepare and deliver to the Depositor
        and/or the Trustee such documents requiring execution and delivery by either
        or
        both of them as are necessary or appropriate to enable the Servicer to service
        and administer the Mortgage Loans to the extent that the Servicer is not
        permitted to execute and deliver such documents pursuant to the preceding
        sentence. Upon receipt of such documents, the Depositor and/or the Trustee
        shall
        promptly execute such documents and deliver them to the Servicer.

      

      In
        accordance with the standards of the preceding paragraph, the Servicer shall
        make Servicing Advances as necessary for the purpose of effecting the payment
        of
        taxes and assessments on the Mortgaged Properties, which advances shall be
        reimbursable in the first instance from related collections from the Mortgagors
        pursuant to Section 3.6 hereof, and further as provided in Section 3.8 hereof.
        The costs incurred by the Servicer, if any, in effecting the timely payments
        of
        taxes and assessments on the Mortgaged Properties and related insurance premiums
        shall not, for the purpose of calculating monthly distributions to the
        Certificateholders, be added to the Stated Principal Balances of the related
        Mortgage Loans, notwithstanding that the terms of such Mortgage Loans so
        permit.

      

      
        
          
          

        

        
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      Upon
        request of the Servicer, the Trustee and the Custodian shall furnish the
        Servicer with any powers of attorney necessary or appropriate to enable the
        Servicer to execute in the name of the Trustee or the Custodian, as applicable,
        all documents reasonably required to perform the servicing functions described
        in this Article 3.

      

      Section
        3.2 Subservicing;
        Enforcement of the Obligations of Servicers.

      

      (a) The
        Servicer may arrange for the subservicing of any Mortgage Loan by a Subservicer
        pursuant to a Subservicing Agreement; provided, however, that such subservicing
        arrangement and the terms of the related Subservicing Agreement must provide
        for
        the servicing of such Mortgage Loans in a manner consistent with the servicing
        arrangements contemplated hereunder. Unless the context otherwise requires,
        references in this Agreement to actions taken or to be taken by the Servicer
        in
        servicing the Mortgage Loans include actions taken or to be taken by a
        Subservicer on behalf of the Servicer. Notwithstanding the provisions of
        any
        Subservicing Agreement, any of the provisions of this Agreement relating
        to
        agreements or arrangements between the Servicer and a Subservicer or reference
        to actions taken through a Subservicer or otherwise, the Servicer shall remain
        obligated and liable to the Depositor, the Trustee and the Certificateholders
        for the servicing and administration of the Mortgage Loans in accordance
        with
        the provisions of this Agreement without diminution of such obligation or
        liability by virtue of such subservicing agreements or arrangements or by
        virtue
        of indemnification from the Subservicer and to the same extent and under
        the
        same terms and conditions as if the Servicer alone were servicing and
        administering the Mortgage Loans. All actions of each Subservicer performed
        pursuant to the related Subservicing Agreement shall be performed as an agent
        of
        the Servicer with the same force and effect as if performed directly by the
        Servicer.

      

      (b) For
        purposes of this Agreement, the Servicer shall be deemed to have received
        any
        collections, recoveries or payments with respect to the Mortgage Loans that
        are
        received by a Subservicer regardless of whether such payments are remitted
        by
        the Subservicer to the Servicer.

      

      Notwithstanding
        anything to the contrary set forth herein, as a condition to the utilization
        of
        any Subservicer or Subcontractor determined to be “participating in the
        servicing function” within the meaning of Item 1122 with respect to more than 5
        percent of the pool assets, the Servicer shall obtain from any such Subservicer
        or Subcontractor used by the Servicer for the benefit of the Depositor a
        written
        agreement from such Subservicer or Subcontractor (in form and substance
        satisfactory to the Depositor) to comply with the provisions of Sections
        3.16
        and 3.17 of this Agreement to the same extent as if such Subservicer or
        Subcontractor were the Servicer.

      

      
        
          
          

        

        
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      Section
        3.3 Rights
        of the Trustee in Respect of the Servicer.

      

      The
        Trustee shall not have any responsibility or liability for any action or
        failure
        to act by the Servicer nor shall the Trustee be obligated to supervise the
        performance of the Servicer hereunder or otherwise.

      

      Section
        3.4 Trustee
        to Act as Servicer.

      

      In
        the
        event that the Servicer shall for any reason no longer be the Servicer hereunder
        (including by reason of an Event of Default), the Successor Servicer shall
        thereupon assume all of the rights and obligations of the Servicer hereunder
        arising thereafter (except that the Trustee shall not be (i) liable for losses
        of the Servicer pursuant to Section 3.9 hereof or any acts or omissions of
        the
        predecessor Servicer hereunder, (ii) obligated to make Advances if it is
        prohibited from doing so by applicable law, (iii) obligated to effectuate
        repurchases or substitutions of Mortgage Loans hereunder including, but not
        limited to, repurchases or substitutions of Mortgage Loans pursuant to Section
        2.2 or 2.3 hereof, (iv) responsible for expenses of the Servicer pursuant
        to
        Section 2.3 hereof or (v) deemed to have made any representations and warranties
        of the Servicer hereunder). If the Servicer shall for any reason no longer
        be
        the Servicer (including by reason of any Event of Default), the Successor
        Servicer shall succeed to any rights and obligations of the Servicer under
        this
        Pooling and Servicing Agreement.

      

      The
        Servicer shall, upon request of the Trustee, but at the expense of the Servicer,
        deliver to the assuming party all documents and records relating to the
        Servicing Agreement or substitute servicing agreement and the Mortgage Loans
        then being serviced thereunder and an accounting of amounts collected or
        held by
        it and otherwise use its best efforts to effect the orderly and efficient
        transfer of the substitute Servicing Agreement to the assuming
        party.

      

      Section
        3.5 Collection
        of Mortgage Loan Payments; Collection Account; Distribution
        Account.

      

      (a) The
        Servicer shall make reasonable efforts in accordance with the customary and
        usual standards of practice of prudent mortgage servicers to collect all
        payments called for under the terms and provisions of the Mortgage Loans
        to the
        extent such procedures shall be consistent with this Agreement. Consistent
        with
        the foregoing, and subject to the provisions of Section 3.1 hereof, the Servicer
        may in its discretion (i) waive any late payment charge or penalty interest
        and
        (ii) extend the due dates for payments due on a Mortgage Note for a period
        not
        greater than 180 days; provided, however, that the Servicer cannot extend
        the
        maturity of any such Mortgage Loan past the date on which the final payment
        is
        due on the latest maturing Mortgage Loan as of the Cut-off Date. In the event
        of
        any such arrangement, any P&I Advance required to be made by the Servicer on
        the related Mortgage Loan in accordance with the provisions hereof (i) with
        respect to the Prepayment Period in which such arrangement became effective
        shall be made in accordance with the amortization schedule of such Mortgage
        Loan
        without giving effect to the modification thereof by reason of such arrangements
        and (ii) with respect to any Prepayment Period thereafter shall be made in
        accordance with the amortization schedule of such Mortgage Loan as so modified.
        The Servicer shall not be required to institute or join in litigation with
        respect to collection of any payment (whether under a Mortgage, Mortgage
        Note or
        otherwise or against any public or governmental authority with respect to
        a
        taking or condemnation) if it reasonably believes that enforcing the provision
        of the Mortgage or other instrument pursuant to which such payment is required
        is prohibited by applicable law.

      

      
        
          
          

        

        
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      The
        Servicer shall comply with the provisions of Section 3.21 hereof with respect
        to
        each Prepayment Penalty related to the Mortgage Loans.

      

      (b) The
        Servicer shall establish and maintain a Collection Account into which the
        Servicer shall deposit or cause to be deposited as soon as practicable following
        receipt but in no event no later than two Business Days after receipt, except
        as
        otherwise specifically provided herein, the following payments and collections
        remitted by Subservicers or received by it in respect of Mortgage Loans
        subsequent to the Cut-off Date (other than in respect of principal and interest
        due on the Mortgage Loans on or before the Cut-off Date) and the following
        amounts required to be deposited hereunder:

      

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

      

      (ii) all
        payments on account of interest on the Mortgage Loans, net of the related
        Servicing Fee and any Prepayment Interest Excess;

      

      (iii) each
        Prepayment Penalty required to be deposited by the Servicer
        hereunder;

      

      (iv) all
        Insurance Proceeds and Liquidation Proceeds, other than proceeds to be applied
        to the restoration or repair of the Mortgaged Property or released to the
        Mortgagor in accordance with the Servicer’s normal servicing
        procedures;

      

      (v) any
        amount required to be deposited by the Servicer pursuant to Section 3.5(d)
        in
        connection with any losses on Permitted Investments;

      

      (vi) any
        amounts required to be deposited by the Servicer pursuant to Section 3.9(b)
        and
        (d) hereof, and in respect of net monthly rental income from REO Property
        pursuant to Section 3.11 hereof;

      

      (vii) any
        amounts required to be deposited pursuant to this Agreement in connection
        with
        the repurchase of a Mortgage Loan by SFM;

      

      (viii) all
        Substitution Adjustment Amounts; 

      

      (ix) all
        P&I Advances made by the Servicer pursuant to Section 3.19 hereof;
        and

      

      (x) the
        amount of any Subsequent Recoveries.

      

      In
        addition, with respect to any Mortgage Loan that is subject to a buydown
        agreement, on each Due Date for such Mortgage Loan, in addition to the monthly
        payment remitted by the Mortgagor, the Servicer shall cause funds to be
        deposited into the Collection Account in an amount required to cause an amount
        of interest to be paid with respect to such Mortgage Loan equal to the amount
        of
        interest that has accrued on such Mortgage Loan from the preceding Due Date
        at
        the related Mortgage Rate (net of the Servicing Fee Rate) on such
        date.

      

      
        
          
          

        

        
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      The
        foregoing requirements for remittance by the Servicer shall be exclusive,
        it
        being understood and agreed that, without limiting the generality of the
        foregoing, payments in the nature of late payment charges, assumption fees
        or
        amounts attributable to reimbursements of Advances, if collected, need not
        be
        remitted by the Servicer. In the event that the Servicer shall remit any
        amount
        not required to be remitted, it may at any time withdraw or direct the
        institution maintaining the Collection Account to withdraw such amount from
        the
        Collection Account, any provision herein to the contrary notwithstanding.
        Such
        withdrawal or direction may be accomplished by delivering written notice
        thereof
        to the Trustee or such other institution maintaining the Collection Account
        which describes the amounts deposited in error in the Collection Account.
        The
        Servicer shall maintain adequate records with respect to all withdrawals
        made
        pursuant to this Section. All funds deposited in the Collection Account shall
        be
        held in trust for the Certificateholders until withdrawn in accordance with
        Section 3.8.

      

      (c) The
        Trustee shall establish and maintain, on behalf of Certificateholders, the
        Distribution Account. On each Distribution Account Deposit Date, the Servicer
        shall remit to the Trustee for deposit in the Distribution Account the Available
        Distribution Amount for such date. In addition, the Trustee shall deposit
        any
        amounts received from the Servicer pursuant to Section 3.5(d) in connection
        with
        losses on Permitted Investments in the Distribution Account.

      

      In
        the
        event that the Servicer shall remit any amount not required to be remitted,
        it
        may at any time direct the Trustee to withdraw such amount from the Distribution
        Account, any provision herein to the contrary notwithstanding. Such direction
        may be accomplished by delivering an Officer’s Certificate to the Trustee which
        describes the amounts deposited in error in the Distribution Account. All
        funds
        deposited in the Distribution Account shall be held by the Trustee in trust
        for
        the Certificateholders until disbursed in accordance with this Agreement
        or
        withdrawn in accordance with Section 3.8. In no event shall the Trustee incur
        liability for withdrawals from the Distribution Account at the direction
        of the
        Servicer.

      

      (d) The
        institutions at which the Collection Account and Distribution Account are
        maintained shall invest funds as directed by the Servicer in Permitted
        Investments which in each case shall mature not later than (i) in the case
        of
        the Collection Account, the second Business Day immediately preceding the
        related Distribution Account Deposit Date (except that if such Permitted
        Investment is an obligation of the institution that maintains such account,
        then
        such Permitted Investment shall mature not later than the Business Day next
        preceding such Distribution Account Deposit Date) and (ii) in the case of
        the
        Distribution Account, the Business Day next preceding the related Distribution
        Date (except that if such Permitted Investment is an obligation of the
        institution that maintains such fund or account, then such Permitted Investment
        shall mature not later than such Distribution Date) and, in each case, shall
        not
        be sold or disposed of prior to its maturity. All such Permitted Investments
        shall be made in the name of the Trustee, for the benefit of the
        Certificateholders. All income and gain net of any losses realized from any
        such
        investment of funds on deposit in the Collection Account shall be for the
        benefit of the Servicer as servicing compensation and all income and gain
        net of
        any losses realized from any such investment of funds on deposit in the
        Distribution Account shall be for the benefit of the Servicer. The amount
        of any
        realized losses in the Collection Account or the Distribution Account in
        respect
        of any such investments shall promptly be deposited by the Servicer in the
        Collection Account or the Distribution Account, respectively. The Trustee
        in its
        fiduciary capacity shall not be liable for the amount of any loss incurred
        in
        respect of any investment or lack of investment of funds held in the Collection
        Account and made in accordance with this Section 3.5.

      

      
        
          
          

        

        
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      (e) In
        order
        to comply with laws, rules, regulations and executive orders in effect from
        time
        to time applicable to banking institutions, including those relating to the
        funding of terrorist activities and money laundering (“Applicable Law”), the
        Trustee is required to obtain, verify and record certain information relating
        to
        individuals and entities which maintain a business relationship with the
        Trustee. Accordingly, each of the parties agrees to provide to the Trustee
        upon
        its request from time to time such identifying information and documentation
        as
        may be available for such party in order to enable the Trustee to comply
        with
        Applicable Law. 

      

      Section
        3.6 Collection
        of Taxes, Assessments and Similar Items; Escrow Accounts.

      

      (a) To
        the
        extent required by the related Mortgage Note and not violative of current
        law,
        the Servicer shall establish and maintain one or more accounts (each, an
“Escrow
        Account”) and deposit and retain therein all collections from the Mortgagors (or
        advances by the Servicer) for the payment of taxes, assessments, hazard
        insurance premiums or comparable items for the account of the Mortgagors.
        Nothing herein shall require the Servicer to compel a Mortgagor to establish
        an
        Escrow Account in violation of applicable law.

      

      (b) Withdrawals
        of amounts so collected from the Escrow Accounts may be made only to effect
        timely payment of taxes, assessments, hazard insurance premiums, condominium
        or
        PUD association dues, or comparable items, to reimburse the Servicer out
        of
        related collections for any payments made pursuant to Sections 3.1 hereof
        (with
        respect to taxes and assessments and insurance premiums) and 3.9 hereof (with
        respect to hazard insurance), to refund to any Mortgagors any sums determined
        to
        be overages, to pay interest, if required by law or the terms of the related
        Mortgage or Mortgage Note, to Mortgagors on balances in the Escrow Account
        or to
        clear and terminate the Escrow Account at the termination of this Agreement
        in
        accordance with Section 9.1 hereof. The Escrow Accounts shall not be a part
        of
        the Trust Fund.

      

      (c) The
        Servicer shall advance, as Servicing Advances, any payments referred to in
        Section 3.6(a) that are not timely paid by the Mortgagors on the date when
        the
        tax, premium or other cost for which such payment is intended is due, provided,
        however that the Servicer shall not be required to make any such advance
        if such
        advance, in the good faith judgment of the Servicer, would constitute a
        Nonrecoverable Advance.

      

      Section
        3.7 Access
        to Certain Documentation and Information Regarding the Mortgage
        Loans.

      

      The
        Servicer shall afford the Depositor and the Trustee reasonable access to
        all
        records and documentation regarding the Mortgage Loans and all accounts,
        insurance information and other matters relating to this Agreement, such
        access
        being afforded without charge, but only upon reasonable request and during
        normal business hours at the office designated by the Servicer.

      

      
        
          
          

        

        
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      Upon
        reasonable advance notice in writing, the Servicer will provide to each
        Certificateholder which is a savings and loan association, bank or insurance
        company certain reports and reasonable access to information and documentation
        regarding the Mortgage Loans sufficient to permit such Certificateholder
        to
        comply with applicable regulations of the OTS or other regulatory authorities
        with respect to investment in the Certificates; provided that the Servicer
        shall
        be entitled to be reimbursed by each such Certificateholder for actual expenses
        incurred by the Servicer in providing such reports and access.

      

      Section
        3.8 Permitted
        Withdrawals from the Collection Account and Distribution Account.

      

      (a) The
        Servicer may from time to time make withdrawals from the Collection Account
        for
        the following purposes:

      

      (i) to
        the
        extent not previously retained by the Servicer, to pay to the Servicer the
        servicing compensation to which it is entitled pursuant to Section 3.14,
        and
        earnings on or investment income with respect to funds in or credited to
        the
        Collection Account as additional servicing compensation;

      

      (ii) to
        the
        extent not previously retained by the Servicer, to reimburse the Servicer
        for
        unreimbursed Advances made by it, such right of reimbursement pursuant to
        this
        subclause (ii) being limited to amounts received on the Mortgage Loan(s)
        in
        respect of which any such Advance was made;

      

      (iii) to
        reimburse the Servicer for any Nonrecoverable Advance previously
        made;

      

      (iv) to
        reimburse the Servicer for Insured Expenses from the related Insurance
        Proceeds;

      

      (v) to
        reimburse the Servicer for unpaid Servicing Fees as provided in Section 3.11
        hereof;

      

      (vi) to
        pay to
        the purchaser, with respect to each Mortgage Loan or property acquired in
        respect thereof that has been purchased pursuant to Section 2.2, 2.3 or 3.11,
        all amounts received thereon after the date of such purchase;

      

      (vii) to
        reimburse the Servicer or the Depositor for expenses incurred by any of them
        and
        reimbursable pursuant to Section 6.3 hereof;

      

      (viii) to
        withdraw any amount deposited in the Collection Account and not required
        to be
        deposited therein;

      

      
        
          
          

        

        
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      (ix) on
        or
        prior to the Distribution Account Deposit Date, to withdraw an amount equal
        to
        the Available Distribution Amount and remit such amount to the Trustee for
        deposit in the Distribution Account; and

      

      (x) to
        clear
        and terminate the Collection Account upon termination of this Agreement pursuant
        to Section 9.1 hereof.

      

      The
        Servicer shall keep and maintain separate accounting, on a Mortgage Loan
        by
        Mortgage Loan basis, for the purpose of justifying any withdrawal from the
        Collection Account pursuant to such subclauses (i), (ii), (iv), (v) and (vi).
        Prior to making any withdrawal from the Collection Account pursuant to subclause
        (iii), the Servicer shall deliver to the Trustee an Officer’s Certificate of a
        Servicing Officer indicating the amount of any previous Advance determined
        by
        the Servicer to be a Nonrecoverable Advance and identifying the related Mortgage
        Loan(s), and their respective portions of such Nonrecoverable
        Advance.

      

      (b) The
        Trustee shall withdraw funds from the Distribution Account for distributions
        to
        Certificateholders in the manner specified in this Agreement. In addition,
        the
        Trustee may prior to making the distribution pursuant to Section 4.1 from
        time
        to time make withdrawals from the Distribution Account for the following
        purposes:

      

      (i) to
        pay to
        itself the Trustee Fee and reimburse itself for reasonable expenses for the
        related Distribution Date (allocated pro rata by Group, if
        applicable);

      

      (ii) to
        the
        extent not previously retained by the Servicer, to pay to the Servicer the
        servicing compensation to which it is entitled pursuant to Section
        3.14;

      

      (iii) to
        pay to
        the Servicer earnings on or investment income with respect to funds in the
        Distribution Account;

      

      (iv) to
        withdraw and return to the Servicer any amount deposited in the Distribution
        Account and not required to be deposited therein, including any amounts owed
        to
        the Servicer as part of the Servicing Fee in accordance with the terms
        hereunder; and

      

      (v) to
        clear
        and terminate the Distribution Account upon termination of the Agreement
        pursuant to Section 9.1 hereof.

      

      Section
        3.9 Maintenance
        of Hazard Insurance; Maintenance of Primary Insurance Policies.

      

      (a) The
        Servicer shall cause to be maintained, for each Mortgage Loan, hazard insurance
        with extended coverage in an amount that is at least equal to the lesser
        of (i)
        the maximum insurable value of the improvements securing such Mortgage Loan;
        (ii) the outstanding principal balance of the Mortgage Loan and (iii) the
        maximum amount available in the locality of the related Mortgaged Property
        from
        insurers generally acceptable to institutional residential mortgage lenders
        without payment of extraordinary premium. Each such policy of standard hazard
        insurance shall contain, or have an accompanying endorsement that contains,
        a
        standard mortgagee clause. Any amounts collected by the Servicer under any
        such
        policies (other than the amounts to be applied to the restoration or repair
        of
        the related Mortgaged Property or amounts released to the Mortgagor in
        accordance with the Servicer’s normal servicing procedures) shall be deposited
        in the Collection Account. Any cost incurred by the Servicer in maintaining
        any
        such insurance shall not, for the purpose of calculating monthly distributions
        to the Certificateholders or remittances to the Trustee for their benefit,
        be
        added to the principal balance of the Mortgage Loan, notwithstanding that
        the
        terms of the Mortgage Loan so permit. Such costs shall be recoverable by
        the
        Servicer as Servicing Advances or, if applicable, as Nonrecoverable Advances.
        It
        is understood and agreed that no earthquake or other additional insurance
        is to
        be required of any Mortgagor or maintained on property acquired in respect
        of a
        Mortgage other than pursuant to such applicable laws and regulations as shall
        at
        any time be in force and as shall require such additional insurance. If the
        Mortgaged Property is located at the time of origination of the Mortgage
        Loan in
        a federally designated special flood hazard area and such area is participating
        in the national flood insurance program, the Servicer shall cause flood
        insurance to be maintained with respect to such Mortgage Loan. Such flood
        insurance shall be in an amount equal to the least of (i) the original principal
        balance of the related Mortgage Loan, (ii) the replacement value of the
        improvements which are part of such Mortgaged Property, and (iii) the maximum
        amount of such insurance available for the related Mortgaged Property under
        the
        national flood insurance program.

      

      
        
          
          

        

        
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      (b) In
        the
        event that the Servicer shall obtain and maintain a blanket policy insuring
        against hazard losses on any or 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 with respect to all of the Mortgage Loans so covered, it
        being
        understood and agreed that such policy may contain a deductible clause on
        terms
        substantially equivalent to those commercially available and maintained by
        comparable servicers. If such policy contains a deductible clause, the 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,
        and there shall have been a loss that would have been covered by such policy,
        deposit in the Collection Account the amount not otherwise payable under
        the
        blanket policy because of such deductible clause. In connection with its
        activities as Servicer of the Mortgage Loans, the Servicer agrees to present,
        on
        behalf of itself, the Depositor, and the Trustee for the benefit of the
        Certificateholders, claims under any such blanket policy.

      

      (c) The
        Servicer shall not take any action which would result in non-coverage under
        any
        applicable Primary Insurance Policy of any loss which, but for the actions
        of
        the Servicer, would have been covered thereunder. The Servicer shall not
        cancel
        or refuse to renew any such Primary Insurance Policy 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 a Qualified
        Insurer.

      

      The
        Servicer shall not be required to maintain any Primary Insurance Policy (i)
        with
        respect to any Mortgage Loan with a Loan-to-Value Ratio less than or equal
        to
        80% (or such lower Loan-to-Value Ratio as may be provided by applicable law)
        as
        of any date of determination or, based on a new appraisal, the principal
        balance
        of such Mortgage Loan represents 80% or less of the new appraised value (or
        other method of determination as may be provided by applicable law) or (ii)
        if
        maintaining such Primary Insurance Policy is otherwise prohibited by applicable
        law.

      

      
        
          
          

        

        
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      The
        Servicer agrees to effect the timely payment of the premiums on each Primary
        Insurance Policy, and such costs not otherwise recoverable shall be recoverable
        by the Servicer as Servicing Advances or, if applicable, as Nonrecoverable
        Advances.

      

      (d) In
        connection with its activities as Servicer of the Mortgage Loans, the Servicer
        agrees to present on behalf of itself, the Trustee and Certificateholders,
        claims to the insurer under any Primary Insurance Policies and, in this regard,
        to take such reasonable action as shall be necessary to permit recovery under
        any Primary Insurance Policies respecting defaulted Mortgage Loans. Any amounts
        collected by the Servicer under any Primary Insurance Policies shall be
        deposited in the Collection Account.

      

      Section
        3.10 Enforcement
        of Due-on-Sale Clauses; Assumption Agreements.

      

      (a) Except
        as
        otherwise provided in this Section, when any property subject to a Mortgage
        has
        been conveyed by the Mortgagor, the Servicer shall to the extent that it
        has
        knowledge of such conveyance enforce any due-on-sale clause contained in
        any
        Mortgage Note or Mortgage, to the extent, in the Servicer’s reasonable judgment,
        enforcement is permitted under applicable law and governmental regulations.
        Notwithstanding the foregoing, the Servicer is not required to exercise such
        rights with respect to a Mortgage Loan if the Person to whom the related
        Mortgaged Property has been conveyed or is proposed to be conveyed satisfies
        the
        terms and conditions contained in the Mortgage Note and Mortgage related
        thereto
        and the consent of the mortgagee under such Mortgage Note or Mortgage is
        not
        otherwise so required under such Mortgage Note or Mortgage as a condition
        to
        such transfer. In the event that the Servicer is prohibited by law from
        enforcing any such due-on-sale clause, or if nonenforcement is otherwise
        permitted hereunder, the Servicer is authorized, subject to Section 3.10(b),
        to
        take or enter into an assumption and modification agreement from or with
        the
        person to whom such property has been or is about to be conveyed, pursuant
        to
        which such person becomes liable under the Mortgage Note and, unless prohibited
        by applicable state law, the Mortgagor remains liable thereon, provided that
        the
        Mortgage Loan shall continue to be covered (if so covered before the Servicer
        enters such agreement) by the applicable Required Insurance Policies. The
        Servicer, subject to Section 3.10(b), is also authorized with the prior approval
        of the insurers under any Required Insurance Policies to enter into a
        substitution of liability agreement with such Person, pursuant to which the
        original Mortgagor is released from liability and such Person is substituted
        as
        Mortgagor and becomes liable under the Mortgage Note. Notwithstanding the
        foregoing, the Servicer shall not be deemed to be in default under this Section
        by reason of any transfer or assumption which the Servicer reasonably believes
        it is restricted by law from preventing, for any reason whatsoever.

      

      (b) Subject
        to the Servicer’s duty to enforce any due-on-sale clause to the extent set forth
        in Section 3.10(a) hereof, in any case in which a Mortgaged Property has
        been
        conveyed to a Person by a Mortgagor, and such Person is to enter into an
        assumption agreement or modification agreement or supplement to the Mortgage
        Note or Mortgage that requires the signature of the Trustee, or if an instrument
        of release signed by the Trustee is required releasing the Mortgagor from
        liability on the Mortgage Loan, the Servicer shall prepare and deliver or
        cause
        to be prepared and delivered to the Trustee for signature and shall direct,
        in
        writing, the Trustee to execute the assumption agreement with the Person
        to whom
        the Mortgaged Property is to be conveyed and such modification agreement
        or
        supplement to the Mortgage Note or Mortgage or other instruments as are
        reasonable or necessary to carry out the terms of the Mortgage Note or Mortgage
        or otherwise to comply with any applicable laws regarding assumptions or
        the
        transfer of the Mortgaged Property to such Person. In connection with any
        such
        assumption, no material term of the Mortgage Note may be changed. In addition,
        the substitute Mortgagor and the Mortgaged Property must be acceptable to
        the
        Servicer in accordance with its underwriting standards as then in effect.
        Together with each such substitution, assumption or other agreement or
        instrument delivered to the Trustee for execution by it, the Servicer shall
        deliver an Officer’s Certificate signed by a Servicing Officer stating that the
        requirements of this subsection have been met in connection therewith. The
        Servicer shall notify the Trustee that any such substitution or assumption
        agreement has been completed by forwarding to the Trustee the original of
        such
        substitution or assumption agreement, which in the case of the original shall
        be
        added to the related Mortgage File and shall, for all purposes, be considered
        a
        part of such Mortgage File to the same extent as all other documents and
        instruments constituting a part thereof. Any fee collected by the Servicer
        for
        entering into an assumption or substitution of liability agreement will be
        retained by the Servicer as additional servicing compensation.

      

      
        
          
          

        

        
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      Section
        3.11 Realization
        Upon Defaulted Mortgage Loans; Repurchase of Certain Mortgage
        Loans.

      

      (a) The
        Servicer shall use its best efforts, consistent with Accepted Servicing
        Practices, to foreclose upon or otherwise comparably convert (which may include
        an acquisition of REO Property) the ownership of properties securing such
        of the
        Mortgage Loans as come into and continue in default and as to which no
        satisfactory arrangements can be made for collection of delinquent payments
        pursuant to Section 3.5, and which are not released from this Agreement pursuant
        to any other provision hereof. The Servicer shall use reasonable efforts
        to
        realize upon such defaulted Mortgage Loans in such manner as will maximize
        the
        receipt of principal and interest by the Trustee, taking into account, among
        other things, the timing of foreclosure proceedings. The foregoing is subject
        to
        the provisions that, in any case in which Mortgaged Property shall have suffered
        damage from an uninsured cause, the Servicer shall not be required to expend
        its
        own funds toward the restoration of such property unless it shall determine
        in
        its sole discretion (i) that such restoration will increase the net proceeds
        of
        liquidation of the related Mortgage Loan to the Trustee, after reimbursement
        to
        itself for such expenses, and (ii) that such expenses will be recoverable
        by
        such Servicer as contemplated in Section 3.8. The Servicer shall be responsible
        for all other costs and expenses incurred by it in any such proceedings;
        provided, however, that it shall be entitled to reimbursement thereof from
        the
        related Mortgage Loan, as contemplated in Section 3.8.

      

      (b) If
        the
        Servicer has actual knowledge that a Mortgaged Property which the Servicer
        is
        contemplating acquiring in foreclosure or by deed in lieu of foreclosure
        is
        located within a one mile radius of any site with material environmental
        or
        hazardous waste risks known to the Servicer, the Servicer will, prior to
        acquiring the Mortgaged Property, consider such risks and shall proceed with
        such in foreclosure or by deed in lieu of foreclosure only if the Servicer
        reasonably determines that doing so shall more like than not be in the best
        interests of the Trust Fund, considering all relevant factors including such
        environmental matters. For the purpose of this Section, actual knowledge
        of the
        Servicer means actual knowledge of a Servicing Officer involved in the servicing
        of the relevant Mortgage Loan at the time such knowledge was acquired. Actual
        knowledge of the Servicer does not include knowledge imputable by virtue
        of the
        availability of or accessibility to information relating to environmental
        or
        hazardous waste sites or the locations thereof.

      

      
        
          
          

        

        
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      (c) With
        respect to any REO Property, the deed or certificate of sale shall be taken
        in
        the name of the Trustee for the benefit of the Certificateholders, or its
        nominee, on behalf of the Certificateholders, provided that the Servicer
        may
        cause title to be placed in the name of the Custodian or the Servicer if
        the
        Servicer reasonably determines that such manner of holding title is required
        or
        advisable in order to facilitate the foreclosure process as to any one or
        more
        particular Mortgage Loans. The Trustee’s name shall be placed on the title to
        such REO Property solely as the Trustee hereunder and not in its individual
        capacity. The Servicer shall ensure that the title to such REO Property
        references this Agreement and the Trustee’s capacity thereunder. The Servicer
        shall use its reasonable best efforts, to sell, or cause its Subservicer
        to
        sell, in accordance with Accepted Servicing Practices, any REO Property serviced
        by the Servicer or Subservicer as soon as possible, but in no event later
        than
        the conclusion of the third calendar year beginning after the year of its
        acquisition by REMIC 1 unless (i) the Servicer applies for and receives an
        extension of such period from the Internal Revenue Service pursuant to the
        REMIC
        Provisions and Code Section 856(e)(3), in which event such REO Property shall
        be
        sold within the applicable extension period, or (ii) the Servicer obtains
        an
        Opinion of Counsel, addressed to the Depositor, the Trustee and the Servicer,
        to
        the effect that the holding by REMIC 1 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 REMIC to fail to qualify
        as
        a REMIC under the REMIC Provisions or comparable provisions of relevant state
        laws at any time. The Servicer shall manage, conserve, protect and operate
        each
        REO Property serviced by the Servicer for the Trustee solely for the purpose
        of
        its prompt disposition and sale in a manner which does not cause such REO
        Property to fail to qualify as “foreclosure property” within the meaning of
        Section 860G(a)(8) or result in the receipt by REMIC 1 of any “income from non
        permitted assets” within the meaning of Section 860F(a)(2)(B) of the Code or any
“net income from foreclosure property” which is subject to taxation under
        Section 860G(a)(1) of the Code. Pursuant to its efforts to sell such REO
        Property, the Servicer shall either itself or through an agent selected by
        the
        Servicer protect and conserve such REO Property in the same manner and to
        such
        extent as is customary in the locality where such REO Property is located
        and
        may, incident to its conservation and protection of the interests of the
        Trustee
        on behalf of the Certificateholders, rent the same, or any part thereof,
        as the
        Servicer deems to be in the best interest of the Trustee on behalf of the
        Certificateholders for the period prior to the sale of such REO Property;
        provided, however, that any rent received or accrued with respect to such
        REO
        Property qualifies as “rents from real property” as defined in Section 856(d) of
        the Code. An independent contractor, as the agent of the Servicer, may be
        retained by the Servicer to perform functions relating to the title, management
        and disposition of REO Property. The Servicer shall be responsible for such
        independent contractor’s fees and expenses relating to an REO Property and shall
        be entitled to reimbursement thereof from the Liquidation Proceeds with respect
        to the related Mortgaged Property, as Servicing Advances or, if applicable,
        as
        Nonrecoverable Advances. The Servicer shall prepare for and deliver to the
        Trustee a statement with respect to any REO Property that has been rented
        showing the aggregate rental income received and all expenses incurred in
        connection with the management and maintenance of such REO Property at such
        times as is necessary to enable the Trustee to comply with the reporting
        requirements of the REMIC Provisions. The net monthly rental income, if any,
        from such REO Property shall be deposited in the Collection Account no later
        than the close of business on each Determination Date. The Servicer shall
        perform the tax reporting and withholding required by Sections 1445 and 6050J
        of
        the Code with respect to foreclosures and abandonments, the tax reporting
        required by Section 6050H of the Code with respect to the receipt of mortgage
        interest from individuals and any tax reporting required by Section 6050P
        of the
        Code with respect to the cancellation of indebtedness by certain financial
        entities, by preparing such tax and information returns as may be required,
        in
        the form required, and delivering the same to the Trustee for
        filing.

      

      
        
          
          

        

        
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      (d) Reserved.

      

      (e) In
        the
        event of a default on a Mortgage Loan one or more of whose obligors is not
        a
“United States person,” as that term is defined in Section 7701(a)(30) of the
        Code, in connection with any foreclosure or acquisition of a deed in lieu
        of
        foreclosure (together, “foreclosure”) in respect of such Mortgage Loan, the
        Servicer will cause compliance with the provisions of Treasury Regulation
        Section 1.1445-2(d)(3) (or any successor thereto) necessary to assure that
        no
        withholding tax obligation arises with respect to the proceeds of such
        foreclosure except to the extent, if any, that proceeds of such foreclosure
        are
        required to be remitted to the obligor on such Mortgage Loan.

      

      (f) Promptly
        upon making any determination not to foreclose, or to discontinue the
        foreclosure process, as to any Mortgage Loan, the Servicer shall deliver
        to the
        Trustee an Officer’s Certificate signed by a Servicing Officer identifying the
        Mortgage Loans as to which such determination has been made (each such Mortgage
        Loan, a “Nonrecoverable Mortgage Loan”) setting forth the basis for such
        determination.

      

      (g) The
        income earned from the management of any REO Properties, net of reimbursement
        to
        the Servicer for expenses incurred (including any property or other taxes)
        in
        connection with such management, Advances and Servicing Advances, shall be
        applied to the payment of principal of and interest on the related defaulted
        Mortgage Loans (with interest accruing as though such Mortgage Loans were
        still
        current) and all such income shall be deemed, for all purposes in this
        Agreement, to be payments on account of principal and interest on the related
        Mortgage Notes and shall be deposited into the Collection Account. To the
        extent
        the net income received during any calendar month is in excess of the amount
        attributable to amortizing principal and accrued interest at the related
        Mortgage Rate on the related Mortgage Loan for such calendar month, such
        excess
        shall be considered to be a partial prepayment of principal of the related
        Mortgage Loan.

      

      (h) The
        proceeds from any liquidation of a Mortgage Loan, as well as any income from
        an
        REO Property, will be applied in the following order of priority: first,
        to
        reimburse the Servicer for any related unreimbursed Servicing Advances and
        Servicing Fees; second, to reimburse the Servicer for any unreimbursed Advances;
        third, to reimburse the Collection Account for any Nonrecoverable Advances
        (or
        portions thereof) that were previously withdrawn by the Servicer pursuant
        to
        Section 3.8(a)(iii) that related to such Mortgage Loan; fourth, to accrued
        and
        unpaid interest (to the extent no Advance has been made for such amount or
        any
        such Advance has been reimbursed) on the Mortgage Loan or related REO Property,
        at the Mortgage Rate (net of the Servicing Fee Rate) to the Due Date occurring
        in the month in which such amounts are required to be distributed; and fifth,
        as
        a recovery of principal of the Mortgage Loan. Excess Proceeds, if any, from
        the
        liquidation of a Liquidated Mortgage Loan will be retained by the Servicer
        as
        additional servicing compensation pursuant to Section 3.14.

      

      
        
          
          

        

        
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      (i) The
        Servicer shall manage, conserve, protect and operate each related REO Property
        for the Trustee solely for the purpose of its prompt disposition and sale.
        The
        Servicer, either itself or through an agent selected by the Servicer, shall
        manage, conserve, protect and operate the REO Property in the same manner
        that
        it manages, conserves, protects and operates other foreclosed property for
        its
        own account, and in the same manner that similar property in the same locality
        as the REO Property is managed. The Servicer shall attempt to sell the same
        (and
        may temporarily rent the same for a period not greater than one year, except
        as
        otherwise provided below) on such terms and conditions as such Servicer deems
        to
        be in the best interest of the Trustee. The Trustee shall have no obligations
        with respect to any REO Dispositions.

      

      (j) The
        Servicer, in its sole discretion, shall have the right to purchase for its
        own
        account from the Trust Fund any Mortgage Loan which is 91 days or more
        Delinquent at a price equal to the Purchase Price; provided however, that
        for
        any such Mortgage Loan that is a Nonrecoverable Mortgage Loan, such purchase
        shall be at a price equal to the Nonrecoverable Mortgage Loan Purchase Price,
        and provided further that any REO Property may be disposed of pursuant to
        the
        preceding Section 3.11(i). The total price calculated pursuant to the preceding
        sentence for any Mortgage Loan purchased hereunder shall be deposited in
        the
        Collection Account and the Trustee, upon receipt of the Request for Release
        from
        the Servicer in the form of Exhibit I hereto, shall release or cause to be
        released to the purchaser of such Mortgage Loan the related Mortgage File
        and
        shall execute and deliver such instruments of transfer or assignment prepared
        by
        the purchaser of such Mortgage Loan, in each case without recourse, as shall
        be
        necessary to vest in the purchaser of such Mortgage Loan any Mortgage Loan
        released pursuant hereto and the purchaser of such Mortgage Loan shall succeed
        to all the Trustee’s right, title and interest in and to such Mortgage Loan and
        all security and documents related thereto. Such assignment shall be an
        assignment outright and not for security. The purchaser of such Mortgage
        Loan
        shall thereupon own such Mortgage Loan, and all security and documents, free
        of
        any further obligation to the Trustee or the Certificateholders with respect
        thereto.

      

      Section
        3.12 Trustee
        to Cooperate; Release of Mortgage Files.

      

      Upon
        the
        payment in full of any Mortgage Loan, or the receipt by the Servicer of a
        notification that payment in full will be escrowed in a manner customary
        for
        such purposes, the Servicer will immediately notify the Trustee by delivering,
        or causing to be delivered a Request for Release substantially in the form
        of
        Exhibit I. Upon receipt of such request, the Trustee shall or shall cause
        the
        Custodian to promptly release the related Mortgage File to the Servicer,
        and the
        Trustee shall at the Servicer’s direction execute and deliver to the Servicer
        the request for reconveyance, deed of reconveyance or release or satisfaction
        of
        mortgage or such instrument releasing the lien of the Mortgage, in each case
        as
        provided by the Servicer, together with the Mortgage Note with written evidence
        of cancellation thereon. In lieu of the document execution process described
        in
        the preceding two sentences, the Servicer shall be authorized to execute
        each
        such Request for Release, request for reconveyance, deed of reconveyance,
        and
        release, satisfaction of mortgage, or such instrument releasing the lien
        of the
        Mortgage as attorney in fact for the Trustee (or the Custodian, if applicable)
        pursuant to the powers of attorney described in Section 3.1. Expenses incurred
        in connection with any instrument of satisfaction or deed of reconveyance
        shall
        be chargeable to the related Mortgagor.

      

      
        
          
          

        

        
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      From
        time
        to time and as shall be appropriate for the servicing or foreclosure of any
        Mortgage Loan, including for such purpose, collection under any policy of
        flood
        insurance, any fidelity bond or errors or omissions policy, or for the purposes
        of effecting a partial release of any Mortgaged Property from the lien of
        the
        Mortgage or the making of any corrections to the Mortgage Note or the Mortgage
        or any of the other documents included in the Mortgage File, the Trustee
        shall,
        upon delivery to the Trustee of a Request for Release in the form of Exhibit
        I
        signed by a Servicing Officer, release the Mortgage File to the Servicer.
        Subject to the further limitations set forth below, the Servicer shall cause
        the
        Mortgage File or documents so released to be returned to the Trustee or its
        Custodian when the need therefor by the Servicer no longer exists.

      

      If
        the
        Servicer at any time seeks to initiate a foreclosure proceeding in respect
        of
        any Mortgaged Property as authorized by this Agreement, the Servicer shall
        deliver or cause to be delivered to the Trustee, for signature, as appropriate,
        any court pleadings, requests for trustee’s sale or other documents necessary to
        effectuate such foreclosure or any legal action brought to obtain judgment
        against the Mortgagor on the Mortgage Note or the Mortgage or to obtain a
        deficiency judgment or to enforce any other remedies or rights provided by
        the
        Mortgage Note or the Mortgage or otherwise available at law or in
        equity.

      

      Section
        3.13 Documents
        Records and Funds in Possession of Servicer to be Held for the
        Trustee.

      

      Notwithstanding
        any other provisions of this Agreement, the Servicer shall transmit to the
        Trustee, or the Custodian on its behalf, all documents and instruments described
        in Section 2.1(b), and shall hold as Servicer and agent of the Trustee all
        other
        documents, in respect of a Mortgage Loan coming into the possession of the
        Servicer from time to time and shall account fully to the Trustee for any
        funds
        received by the Servicer or which otherwise are collected by the Servicer
        as
        Liquidation Proceeds or Insurance Proceeds in respect of any Mortgage Loan.
        All
        Mortgage Files and funds collected or held by, or under the control of, the
        Servicer in respect of any Mortgage Loans, whether from the collection of
        principal and interest payments or from Liquidation Proceeds, including but
        not
        limited to, any funds on deposit in the Collection Account, shall be held
        by the
        Servicer for and on behalf of the Trustee and shall be and remain the sole
        and
        exclusive property of the Trustee, subject to the applicable provisions of
        this
        Agreement. The Servicer also agrees that it shall not create, incur or subject
        any Mortgage File or any funds that are deposited in the Collection Account,
        Distribution Account or any Escrow Account, or any funds that otherwise are
        or
        may become due or payable to the Trustee for the benefit of the
        Certificateholders, to any claim, lien, security interest, judgment, levy,
        writ
        of attachment or other encumbrance, or assert by legal action or otherwise
        any
        claim or right of setoff against any Mortgage File or any funds collected
        on, or
        in connection with, a Mortgage Loan, except, however, that the Servicer shall
        be
        entitled to set off against and deduct from any such funds any amounts that
        are
        properly due and payable to the Servicer under this Agreement.

      

      
        
          
          

        

        
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      Section
        3.14 Servicing
        Compensation.

      

      As
        compensation for its activities hereunder, the Servicer shall be entitled
        to
        retain or withdraw from the Collection Account an amount equal to the Servicing
        Fee for each Mortgage Loan, provided that the aggregate Servicing Fee with
        respect to any Distribution Date shall be reduced (i) by the amount of any
        Compensating Interest paid by the Servicer with respect to such Distribution
        Date, and (ii) with respect to the first Distribution Date, an amount equal
        to
        any amount to be deposited into the Distribution Account by the Depositor
        pursuant to Section 2.1(a) and not so deposited.

      

      Additional
        servicing compensation in the form of (i) Prepayment Interest Excess and
        all
        income and gain net of any losses realized from Permitted Investments and
        (ii)
        assumption fees, late payment charges, and other receipts not required to
        be
        deposited to the Collection Account pursuant to Section 3.5 hereof, including
        any Excess Proceeds, shall be retained by the Servicer as additional servicing
        compensation. The Servicer shall be required to pay all expenses incurred
        by
        them respectively in connection with their respective activities hereunder
        to
        the extent such expenses do not constitute Advances or Nonrecoverable Advances
        as defined in this Agreement and shall not be entitled to reimbursement therefor
        except as specifically provided in this Agreement.

      

      Section
        3.15 Access
        to Certain Documentation.

      

      The
        Servicer shall provide to the OTS and the FDIC and to comparable regulatory
        authorities supervising Holders of Subordinate Certificates and the examiners
        and supervisory agents of the OTS, the FDIC and such other authorities, access
        to the documentation regarding the Mortgage Loans required by applicable
        regulations of the OTS and the FDIC. Such access shall be afforded without
        charge, but only upon reasonable and prior written request and during normal
        business hours at the offices designated by the Servicer. Nothing in this
        Section shall limit the obligation of the Servicer to observe any applicable
        law
        prohibiting disclosure of information regarding the Mortgagors and the failure
        of the Servicer to provide access as provided in this Section as a result
        of
        such obligation shall not constitute a breach of this Section.

      

      Section
        3.16 Annual
        Statement as to Compliance.

      

      Commencing
        in 2008, the Servicer shall deliver to the Depositor and the Trustee on or
        before March 15 of each applicable calendar year (or March 24 if there is
        no
        requirement to file a Form 10-K in that calendar year) an Officer’s Certificate
        stating, as to the signer thereof, that (i) a review of the activities of
        the
        Servicer during the preceding fiscal year and of the performance of the Servicer
        under this Agreement has been made under such officer’s supervision and (ii) to
        the best of such officer’s knowledge, based on such review, the Servicer has
        fulfilled all of its material obligations under this Agreement throughout
        such
        year, or, if there has been a material default in the fulfillment of any
        such
        obligation, specifying each such default known to such officer and the nature
        and status thereof. Upon request, the Trustee shall forward a copy of each
        such
        statement to each Rating Agency and each Underwriter.

      

      Commencing
        in 2008, on or before March 15 of each calendar year (or March 24 if there
        is no
        requirement to file a Form 10-K in that calendar year), the Servicer shall
        deliver to the Depositor, the Servicer and the Trustee a report regarding
        its
        assessment of compliance with the servicing criteria specified in paragraph
        (d)
        of Item 1122 of Regulation AB (§ 229.1122(d)), as of and for the period ending
        the end of each fiscal year, with respect to asset-backed security transactions
        taken as a whole involving the Servicer, and that are backed by the same
        asset
        type as the Mortgage Loans. Each such report shall include all of the statements
        required under paragraph (a) of Item 1122 of Regulation AB (§
229.1122(a)).

      

      
        
          
          

        

        
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      Copies
        of
        such statements shall be provided to any Securityholder upon request, by
        the
        Servicer or by the Trustee at the Servicer’s expense if the Servicer failed to
        provide such copies (unless (i) the Servicer shall have failed to provide
        the
        Trustee with such statement or (ii) the Trustee shall be unaware of the
        Servicer’s failure to provide such statement).

      

      The
        Servicer shall promptly notify the Depositor and the Trustee (i) of any legal
        proceedings pending against the Servicer of the type described in Item 1117
        (§
229.1117) of Regulation AB and (ii) if the Servicer shall become (but only
        to
        the extent not previously disclosed to the Trustee and the Depositor) at
        any
        time an affiliate of any of the Seller, the Trustee or any Servicer,
        Subservicer, Subcontractor or “Originator” contemplated by Item 1110 (§
229.1110) of Regulation AB, any significant obligor contemplated by Item
        1112 (§
229.1112) of Regulation AB, any enhancement or support provider contemplated
        by
        Items 1114 or 1115 (§§ 229.1114-1115) of Regulation AB or any other material
        party to the Trust Fund contemplated by Item 1100(d)(1) (§ 229.1100(d)(1)) of
        Regulation AB.

      

      Section
        3.17 Annual
        Independent Public Accountants’ Servicing Statement.

      

      Commencing
        in 2008, on or before March 15 of each calendar year (or March 24 if there
        is no
        requirement to file a Form 10-K in that calendar year), the Servicer shall
        deliver to the Trustee and the Depositor a report by a registered public
        accounting firm that attests to, and reports on, the assessment made by the
        Servicer pursuant to the second paragraph of Section 3.16. Such report shall
        be
        made in accordance with standards for attestation engagements issued or adopted
        by the Public Company Accounting Oversight Board.

      

      Section
        3.18 Errors
        and Omissions Insurance; Fidelity Bonds.

      

      The
        Servicer shall for so long as it acts as Servicer under this Agreement, obtain
        and maintain in force (a) a policy or policies of insurance covering errors
        and
        omissions in the performance of its obligations as Servicer hereunder and
        (b) a
        fidelity bond in respect of its officers, employees and agents. Each such
        policy
        or policies and bond shall, together, comply with the requirements from time
        to
        time of Fannie Mae or Freddie Mac for persons performing servicing for mortgage
        loans purchased by Fannie Mae or Freddie Mac. In the event that any such
        policy
        or bond ceases to be in effect, the Servicer shall obtain a comparable
        replacement policy or bond from an insurer or issuer, meeting the requirements
        set forth above as of the date of such replacement.

      

      Section
        3.19 Advances.

      

      The
        Servicer shall determine on or before each Determination Date whether it
        is
        required to make a P&I Advance pursuant to the definition thereof. If the
        Servicer determines it is required to make a P&I Advance, it shall, before
        the Distribution Account Deposit Date, deposit into the Distribution Account
        an
        amount equal to the P&I Advance. The Servicer shall be entitled to be
        reimbursed for all P&I Advances of its own funds made pursuant to this
        Section as provided in Section 3.8 hereof. The obligation to make P&I
        Advances with respect to any Mortgage Loan shall continue if such Mortgage
        Loan
        has been foreclosed or otherwise terminated and the related Mortgaged Property
        has not been liquidated, provided that in no event shall the Servicer be
        required to make any proposed Advance that, if made, would in the good faith
        judgment of the Servicer to be a Nonrecoverable Advance.

      

      
        
          
          

        

        
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      The
        Servicer shall deliver to the Trustee on the related Distribution Account
        Deposit Date an Officer’s Certificate of a Servicing Officer indicating the
        amount of any proposed Advance that, if made, would in the good faith judgment
        of the Servicer be a Nonrecoverable Advance.

      

      Section
        3.20 Advance
        Facility.

      

      The
        Servicer is hereby authorized to enter into any facility with any Person
        (any
        such Person, an “Advance Facility Counterparty”) which provides that the
        Servicer may pledge or sell its rights to receive reimbursement of Advances
        pursuant to this Agreement (“Advance Reimbursement Rights”) pursuant to credit
        facilities, repurchase facilities, or similar facilities providing liquidity
        for
        the funding of Advances, including facilities providing that such Advance
        Facility Counterparty may make all or a portion of the Advances (any such
        facility, an “Advance Facility”), although no Advance Facility shall reduce or
        otherwise affect the Servicer’s obligations to fund such Advances. If so
        required pursuant to the terms of an Advance Facility, to the extent that
        an
        Advance Facility Counterparty makes all or a portion of any Advance and the
        Advance Facility Counterparty and the Servicer provide the Trustee with notice
        acknowledged by the Servicer that such Advance Facility Counterparty is entitled
        to reimbursement, such Advance Facility Counterparty shall be entitled to
        receive reimbursement pursuant to this Agreement for such amount to the extent
        provided. Such notice from the Advance Facility Counterparty and the Servicer
        must specify the amount of the reimbursement and must specify which Section
        of
        this Agreement permits the Advance to be reimbursed. The Trustee shall be
        entitled to conclusively rely without independent investigation on the Advance
        Facility Counterparty’s statement with respect to the amount of any
        reimbursement pursuant to this Section 3.20 and with respect to the Advance
        Facility Counterparty’s statement with respect to the Section of this Agreement
        permits the Advance to be reimbursed. An Advance Facility Counterparty whose
        obligations are limited to the making of Advances will not be deemed to be
        a
        Subservicer under this Agreement.

      

      (b) If
        so
        required pursuant to the terms of an Advance Facility, the Servicer may direct,
        and if so directed in writing the Trustee is hereby authorized to and shall
        pay
        to the Advance Facility Counterparty (i) reimbursements for Advances; and
        (ii)
        all or such portion of the Servicing Fee as may be so specified in the Advance
        Facility, that would otherwise be payable to the Servicer pursuant to this
        Agreement or the Servicing Agreement. 

      

      (c) Upon
        request of the Servicer, the Trustee agrees to execute such acknowledgments
        recognizing the interests of any Advance Facility Counterparty in such Advance
        Reimbursement Rights and Servicing Fees as the Servicer may cause to be made
        subject to Advance Facilities pursuant to this Section 3.20, and such other
        documents in connection with such Advance Facilities as may be reasonably
        requested from time to time by any Advance Facility Counterparty. The
        implementation of the arrangement described in this Section shall not require
        the consent of Certificateholders or the Trustee.

      

      
        
          
          

        

        
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      Section
        3.21 Prepayment
        Penalties.

      

      The
        Servicer will not waive any Prepayment Penalty or part of a Prepayment Penalty
        unless (i) such waiver relates to a default or a reasonably foreseeable default
        and would, in the reasonable judgment of the Servicer, maximize recovery
        of
        total net proceeds taking into account the value of such Prepayment Penalty
        and
        related Mortgage Loan and, if such waiver is made in connection with a
        refinancing of the related Mortgage Loan, such refinancing is related to
        a
        default or a reasonably foreseeable default; (ii) the related Mortgage Loan
        indebtedness has been accelerated; or (iii) the Servicer obtains an Opinion
        of
        Counsel, which may be in-house counsel for the Servicer, opining that the
        Prepayment Penalty is not legally enforceable in the circumstances under
        which
        the related prepayment occurs. In no event will the Servicer waive a Prepayment
        Penalty in connection with a refinancing of a Mortgage Loan that is not related
        to a default or a reasonably foreseen default.

      

      ARTICLE
        4

      

      DISTRIBUTIONS

      

      Section
        4.1 Priorities
        of Distribution.
        

      

      (a) On
        each
        Distribution Date, the Trustee shall make the following distributions from
        the
        Distribution Account, net of the Trustee Fee and Trustee’s expenses, of an
        amount equal to the Interest Remittance Amount in the following order of
        priority:

      

      (i) to
        the
        Swap Account, the sum of (x) all Net Swap Payments and (y) any Swap Termination
        Payment owed to the Swap Counterparty, but not including any Defaulted Swap
        Termination Payment owed to the Swap Counterparty, if any;

      

      (ii) concurrently,
        (1) from the remaining portion of the Interest Remittance Amount related
        to the
        Group 1 Mortgage Loans, to the Class A-1 Certificates, their Senior Interest
        Distribution Amount for such Distribution Date, and (2) from the remaining
        portion of the Interest Remittance Amount related to the Group 2 Mortgage
        Loans,
        concurrently, to the Group 2 Senior Certificates, their respective Senior
        Interest Distribution Amounts for such Distribution Date, pro rata based
        on
        their respective Senior Interest Distribution Amounts for such Distribution
        Date; 

      

      (iii) concurrently,
        (1) from the remaining portion of the Interest Remittance Amount related
        to the
        Group 1 Mortgage Loans, concurrently, to the Group 2 Senior Certificates,
        their
        respective Senior Interest Distribution Amounts for such Distribution Date
        remaining unpaid after clause second above, pro rata based on their respective
        Senior Interest Distribution Amounts for such Distribution Date, and (2)
        from
        the remaining portion of the Interest Remittance Amount related to the Group
        2
        Mortgage Loans, to the Class A-1 Certificates, their Senior Interest
        Distribution Amount for such Distribution Date remaining unpaid after clause
        second above;

      

      
        
          
          

        

        
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      (iv) sequentially,
        to the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6,
        Class
        B-1, Class B-2 and Class B-3 Certificates, in that order, their respective
        Subordinate Interest Distribution Amounts, in each case, to the extent of
        the
        Interest Remittance Amount remaining after distributions of interest to the
        Classes of Certificates with a higher payment priority; and

      

      (v) any
        remaining Interest Remittance Amount on any Distribution Date will be
        distributed as part of Net Monthly Excess Cashflow pursuant to Section 4.1(d)
        below;

      

      (b) On
        each
        Distribution Date (a) prior to the Stepdown Date or (b) on which a Trigger
        Event
        is in effect, the holders of each Class of Certificates shall be entitled
        to
        receive distributions in respect of principal from the Principal Distribution
        Amount and the Swap Counterparty shall be entitled to the payments described
        below, in each case to the extent of the Available Distribution Amount available
        therefor after payment of the Interest Distribution Amount, in the following
        order of priority:

      

      (i) to
        the
        Swap Account, the sum of (x) all Net Swap Payments and (y) any Swap Termination
        Payment owed to the Swap Counterparty, but not including any Defaulted Swap
        Termination Payment owed to the Swap Counterparty, if any, remaining unpaid
        on
        that Distribution Date after distributions from the Interest Remittance Amount
        for that Distribution Date;

      

      (ii) to
        the
        Senior Certificates in accordance with Section 4.1(e);

      

      (iii) sequentially,
        to the holders of the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5,
        Class M-6, Class B-1, Class B-2 and Class B-3 Certificates, in that order,
        until
        their respective Class Principal Balances are reduced to zero; and

      

      (iv) any
        remaining Principal Distribution Amount on any Distribution Date will be
        distributed as part of Net Monthly Excess Cashflow pursuant to Section 4.1(d)
        below;

      

      (c) On
        each
        Distribution Date (a) on or after the Stepdown Date and (b) on which a Trigger
        Event is not in effect, the holders of each Class of Certificates and the
        Swap
        Counterparty shall be entitled to receive distributions from the Principal
        Distribution Amount, in the following order of priority: 

      

      (i) to
        the
        Swap Account, the sum of (x) all Net Swap Payments and (y) any Swap Termination
        Payment owed to the Swap Counterparty, but not including any Defaulted Swap
        Termination Payment owed to the Swap Counterparty, if any, remaining unpaid
        on
        that Distribution Date after distributions from the Interest Remittance Amount
        for that Distribution Date;

      

      (ii) to
        the
        holders of the Senior Certificates, in an amount up to the Senior Principal
        Distribution Amount, in accordance with Section 4.1(e), until their respective
        Class Principal Balances are reduced to zero;

      

      
        
          
          

        

        
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      (iii) to
        the
        Class M-1 Certificates, in an amount up to the Class M-1 Principal Distribution
        Amount, until its Class Principal Balance is reduced to zero;

      

      (iv) to
        the
        Class M-2 Certificates, in an amount up to the Class M-2 Principal Distribution
        Amount, until its Class Principal Balance is reduced to zero;

      

      (v) to
        the
        Class M-3 Certificates, in an amount up to the Class M-3 Principal Distribution
        Amount, until its Class Principal Balance is reduced to zero; 

      

      (vi) to
        the
        Class M-4 Certificates, in an amount up to the Class M-4 Principal Distribution
        Amount, until its Class Principal Balance is reduced to zero;

      

      (vii) to
        the
        Class M-5 Certificates, in an amount up to the Class M-5 Principal Distribution
        Amount, until its Class Principal Balance is reduced to zero;

      

      (viii) to
        the
        Class M-6 Certificates, in an amount up to the Class M-6 Principal Distribution
        Amount, until its Class Principal Balance is reduced to zero;

      

      (ix) to
        the
        Class B-1 Certificates, in an amount up to the Class B-1 Principal Distribution
        Amount, until its Class Principal Balance is reduced to zero;

      

      (x) to
        the
        Class B-2 Certificates, in an amount up to the Class B-2 Principal Distribution
        Amount, until its Class Principal Balance is reduced to zero;

      

      (xi) to
        the
        Class B-3 Certificates, in an amount up to the Class B-3 Principal Distribution
        Amount, until its Class Principal Balance is reduced to zero;

      

      (xii) any
        remaining Principal Distribution Amount on any Distribution Date will be
        distributed as part of Net Monthly Excess Cashflow pursuant to Section 4.1(d)
        below; 

      

      (d) On
        each
        Distribution Date, the Net Monthly Excess Cashflow and, for purposes of making
        distributions at priorities (i), and (xxi) through (xxv) below, from the
        Excess
        Reserve Fund, will be distributed to the certificates and the Swap Counterparty
        in the following order of priority: 

      

      (i) from
        any
        Interest Rate Cap Payment on deposit in the Excess Reserve Fund Account with
        respect to that Distribution Date, first, concurrently, to the Classes of
        Offered Certificates then outstanding, first pro rata, based on their respective
        Class Principal Balances, to the extent needed to pay any Interest Carry
        Forward
        Amount for each such Class and then, pro rata, based on any Interest Carry
        Forward Amount remaining for each such Class, in an amount up to the amount
        of
        any Interest Carry Forward Amount remaining unpaid for such Classes of
        Certificates;

      

      (ii) to
        the
        Class M-1 Certificates, the related Interest Carry Forward Amount;

      

      (iii) to
        the
        Class M-1 Certificates, the related Unpaid Realized Loss Amount;

      

      
        
          
          

        

        
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      (iv) to
        the
        Class M-2 Certificates, the related Interest Carry Forward Amount;

      

      (v) to
        the
        Class M-2 Certificates, the related Unpaid Realized Loss Amount;

      

      (vi) to
        the
        Class M-3 Certificates, the related Interest Carry Forward Amount;

      

      (vii) to
        the
        Class M-3 Certificates, the related Unpaid Realized Loss Amount;

      

      (viii) to
        the
        Class M-4 Certificates, the related Interest Carry Forward Amount;

      

      (ix) to
        the
        Class M-4 Certificates, the related Unpaid Realized Loss Amount;

      

      (x) to
        the
        Class M-5 Certificates, the related Interest Carry Forward Amount;

      

      (xi) to
        the
        Class M-5 Certificates, the related Unpaid Realized Loss Amount;

      

      (xii) to
        the
        Class M-6 Certificates, the related Interest Carry Forward Amount;

      

      (xiii) to
        the
        Class M-6 Certificates, the related Unpaid Realized Loss Amount;

      

      (xiv) to
        the
        Class B-1 Certificates, the related Interest Carry Forward Amount;

      

      (xv) to
        the
        Class B-1 Certificates, the related Unpaid Realized Loss Amount;

      

      (xvi) to
        the
        Class B-2 Certificates, the related Interest Carry Forward Amount;

      

      (xvii) to
        the
        Class B-2 Certificates, the related Unpaid Realized Loss Amount;

      

      (xviii) to
        the
        Class B-3 Certificates, the related Interest Carry Forward Amount;

      

      (xix) to
        the
        Class B-3 Certificates, the related Unpaid Realized Loss Amount;

      

      (xx) to
        the
        Excess Reserve Fund Account, the amount of any Basis Risk Payment for that
        Distribution Date;

      

      (xxi) from
        any
        remaining Interest Rate Cap Payment on deposit in the Excess Reserve Fund
        Account with respect to that Distribution Date, first, concurrently, to the
        Classes of Offered Certificates then outstanding, first pro rata, based on
        their
        respective Class Principal Balances, to the extent needed to pay any Basis
        Risk
        Carry Forward Amount for each such Class and then, pro rata, based on any
        Basis
        Risk Carry Forward Amount remaining for each such Class, in an amount up
        to the
        amount of any Basis Risk Carry Forward Amount remaining unpaid for such Classes
        of Certificates;

      

      
        
          
          

        

        
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      (xxii) from
        funds on deposit in the Excess Reserve Fund Account (not including any Interest
        Rate Cap Payment included in that account), sequentially, first (i)
        concurrently, to the Classes of Senior Certificates currently outstanding,
        first
        pro rata, based on their respective Class Principal Balances, to the extent
        needed to pay any Basis Risk Carry Forward Amount for each such Class and
        then,
        pro rata, based on any Basis Risk Carry Forward Amount remaining unpaid for
        each
        such Class, in an amount up to the amount of any Basis Risk Carry Forward
        Amount
        remaining unpaid for such Classes of Certificates and then (ii) sequentially,
        to
        the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class
        B-1,
        Class B-2 and Class B-3 Certificates, in that order, in an amount up to the
        amount of any Basis Risk Carry Forward Amount for such Classes of
        Certificates;

      

      (xxiii) from
        all
        remaining amounts (including remaining funds on deposit in the Excess Reserve
        Fund Account), sequentially, first (i) concurrently, to the Senior Certificates,
        first pro rata, based on their respective Class Principal Balances to the
        extent
        needed to pay any Unpaid Interest Shortfall Amount for each such Class and
        then,
        pro rata, based on any Unpaid Interest Shortfall Amount remaining unpaid
        for
        each such Class, in an amount up to the amount of any Unpaid Interest Shortfall
        Amount remaining unpaid for such Classes of Certificates and then (ii)
        sequentially, to the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5,
        Class M-6, Class B-1, Class B-2 and Class B-3 Certificates, in that order,
        in an
        amount up to the amount of any Unpaid Interest Shortfall Amount for such
        Classes
        of Certificates;

      

      (xxiv) from
        all
        remaining amounts (including remaining funds on deposit in the Excess Reserve
        Fund Account), to the Swap Account, the amount of any Defaulted Swap Termination
        Payment owed to the Swap Counterparty;

      

      (xxv) from
        all
        remaining amounts (including remaining funds on deposit in the Excess Reserve
        Fund Account), to the holders of the Class OC Certificates, the Class OC
        Distributable Amount and any remaining Interest Rate Cap Payment;
        and

      

      (xxvi) to
        the
        holders of the Class R Certificates, any remaining amounts; provided that
        if
        such Distribution Date is the Distribution Date immediately following the
        expiration of the latest prepayment charge term with respect to the Mortgage
        Loans or any Distribution Date thereafter, then any such remaining amounts,
        together with the Class P Distribution Amount, will be distributed first,
        to the
        holders of the Class P Certificates, until the Class Principal Balance thereof
        has been reduced to zero; and second, to the holders of the Class R
        Certificates.

      

      (e) All
        principal distributions to the holders of the Senior Certificates on any
        Distribution Date will be allocated concurrently between the Group 1 Senior
        Certificates and the Group 2 Senior Certificates, based on their respective
        Class A Principal Allocation Percentages for that Distribution Date. Any
        payments of principal to the Group 1 Senior Certificates will first be made
        from
        payments relating to the Group 1 Mortgage Loans and any payments of principal
        to
        the Group 2 Senior Certificates will first be made from payments relating
        to the
        Group 2 Mortgage Loans.

      

      
        
          
          

        

        
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      However,
        commencing with the Distribution Date on which the aggregate Class Principal
        Balance of either the Group 1 Senior Certificates or the Group 2 Senior
        Certificates has been reduced to zero, the remaining principal distributions
        distributable to the Senior Certificates on that Distribution Date and all
        of
        the principal distributions distributable to the Senior Certificates on all
        subsequent Distribution Dates will be distributed to the holders of the
        remaining Senior Certificates in accordance with the principal distribution
        allocations described below, until their Class Principal Balances have been
        reduced to zero (without regard to the Group 1 Senior Principal Allocation
        Amount or Group 2 Principal Allocation Amount).

      

      Distributions
        to the Group 1 Senior Certificates.
        On each
        Distribution Date, the Group 1 Senior Principal Allocation Amount will be
        distributed to the Class A-1 Certificates, until its Class Principal Balance
        is
        reduced to zero;

      

      Distributions
        to the Group 2 Senior Certificates.
        On each
        Distribution Date, the Group 2 Senior Principal Allocation Amount will be
        distributed, sequentially, to the Class A-2a, Class A-2b, Class A-2c and
        Class
        A-2d Certificates, in that order, until their respective Class Principal
        Balances have been reduced to zero.

      

      However,
        from and after the Distribution Date on which the aggregate Class Principal
        Balances of the Class M-1, Class M-2, Class M-3, Class M-4,
        Class M-5, Class M-6, Class B-1, Class B-2 and
        Class B-3 Certificates and the Class Principal Balance of the Class OC
        Certificates have been reduced to zero, any principal distributions allocated
        to
        the Class A-2a, Class A-2b, Class A-2c and Class A-2d
        Certificates are required to be distributed pro rata among those Classes,
        based
        on their Class Principal Balances, until their Class Principal Balances have
        been reduced to zero.

      

      (f) On
        each
        Distribution Date, the Class P Distribution Amount received during the related
        Prepayment Period will be distributed to the holders of the Class P
        Certificates.

      

      Section
        4.2 Method
        of Distribution.

      

      (a) All
        distributions with respect to each Class of Certificates on each Distribution
        Date shall be made pro rata among the outstanding Certificates of such Class,
        based on the Percentage Interest in such Class represented by each Certificate.
        Payments to the Certificateholders on each Distribution Date shall be made
        by
        the Trustee to the Certificateholders of record on the related Record Date
        by
        check or money order mailed to a Certificateholder at the address appearing
        in
        the Certificate Register, or upon written request by such Certificateholder
        to
        the Trustee made not later than the applicable Record Date, by wire transfer
        to
        a U.S. depository institution acceptable to the Trustee, or by such other
        means
        of payment as such Certificateholder and the Trustee shall agree.

      

      (b) Each
        distribution with respect to a Book-Entry Certificate shall be paid to the
        Depository, which shall credit the amount of such distribution to the accounts
        of its Depository Participants in accordance with its normal procedures.
        Each
        Depository Participant shall be responsible for disbursing such distribution
        to
        the Certificate Owners that it represents and to each financial intermediary
        for
        which it acts as agent. Each such financial intermediary shall be responsible
        for disbursing funds to the Certificate Owners that it represents. All such
        credits and disbursements with respect to a Book-Entry Certificate are to
        be
        made by the Depository and the Depository Participants in accordance with
        the
        provisions of the applicable Certificates. Neither the Trustee nor the Servicer
        shall have any responsibility therefor except as otherwise provided by
        applicable law.

      

      
        
          
          

        

        
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      (c) The
        Trustee shall withhold or cause to be withheld such amounts as it reasonably
        determines are required by the Code (giving full effect to any exemptions
        from
        withholding and related certifications required to be furnished by
        Certificateholders or Certificate Owners and any reductions to withholding
        by
        virtue of any bilateral tax treaties and any applicable certification required
        to be furnished by Certificateholders or Certificate Owners with respect
        thereto) from distributions to be made to a “Foreign Person” as defined in
        Section 1445(f)(3) of the Code. 

      

      Section
        4.3 Allocation
        of Losses.

      

      (a) On
        each
        Distribution Date, the Trustee shall allocate any excess of the aggregate
        Class
        Principal Balance of the Certificates over the aggregate Stated Principal
        Balance of the Mortgage Loans to reduce the Class Principal Balances of the
        Subordinate Certificates in the following order of priority:

      

      (i) to
        the
        Class B-3 Certificates, until the Class Principal Balance thereof is reduced
        to
        zero;

      

      (ii) to
        the
        Class B-2 Certificates, until the Class Principal Balance thereof is reduced
        to
        zero;

      

      (iii) to
        the
        Class B-1 Certificates, until the Class Principal Balance thereof is reduced
        to
        zero;

      

      (iv) to
        the
        Class M-6 Certificates, until the Class Principal Balance thereof is reduced
        to
        zero;

      

      (v) to
        the
        Class M-5 Certificates, until the Class Principal Balance thereof is reduced
        to
        zero;

      

      (vi) to
        the
        Class M-4 Certificates until the Class Principal Balance thereof has been
        reduced to zero;

      

      (vii) to
        the
        Class M-3 Certificates until the Class Principal Balance thereof has been
        reduced to zero; 

      

      (viii) to
        the
        Class M-2 Certificates until the Class Principal Balance thereof is reduced
        to
        zero; and

      

      (ix) to
        the
        Class M-1 Certificates until the Class Principal Balance thereof is reduced
        to
        zero.

      

      (b) Realized
        Losses shall not be allocated to the Senior Certificates or the Class P
        Certificates.

      

      
        
          
          

        

        
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      (c) Notwithstanding
        the foregoing, the Class Principal Balance of a Class of Subordinate
        Certificates that has been reduced because of allocations of Realized Losses
        may
        also be increased as a result of Subsequent Recoveries. If a final liquidation
        of a Mortgage Loan resulted in a Realized Loss and thereafter the Servicer
        receives a recovery specifically related to that Mortgage Loan, such recovery
        (net of any reimbursable expenses) shall be distributed to the
        Certificateholders on any Distribution Date in the same manner as prepayments
        received in
        the
        related Prepayment Period. In addition, the Class Principal Balance of each
        Class of Subordinate Certificates to which Realized Losses have been allocated,
        shall be increased, sequentially in the order of payment priority, to the
        extent
        that such Subsequent Recoveries are distributed as principal to any Class
        of
        Subordinate Certificates to the extent that (i) the related Realized Loss
        was
        allocated to any Class of Subordinate Certificates and (ii) the aggregate
        Stated
        Principal Balance of the Mortgage Loans as of immediately preceding Due Date
        (after giving effect to unscheduled receipts of principal in the Prepayment
        Period related to that prior Due Date) exceeds the aggregate Class Principal
        Balance of the Senior Certificates immediately prior to that Distribution
        Date.
        However, the Class Principal Balance of each such Class of Subordinate
        Certificates will not be increased by more than the amount of Realized Losses
        previously applied to reduce the Class Principal Balance of each such Class
        of
        Subordinate Certificates. Holders of Certificates whose Class Principal Balance
        is increased in this manner shall not be entitled to interest on the increased
        balance for any Interest Accrual Period preceding the Distribution Date on
        which
        the increase occurs. The foregoing provisions shall apply even if the Class
        Principal Balance of a Class of Subordinate Certificates was previously reduced
        to zero. Accordingly, each Class of Subordinate Certificates will be considered
        to remain outstanding until the termination of the Trust Fund.

      

      Section
        4.4 Reports
        to the Depositor and the Trustee.

      

      On
        or
        before the Business Day preceding each Distribution Date, the Servicer shall
        notify, or cause to be notified, the Depositor and the Trustee of the following
        information with respect to the next Distribution Date (which notification
        may
        be given by facsimile, electronic transmission or by telephone promptly
        confirmed in writing):

      

      
        	 	
                (a)

              	
                the
                  aggregate amount then on deposit in the Distribution Account and
                  the
                  source thereof (identified as interest, scheduled principal or
                  unscheduled
                  principal);

              

      

      

      
        	 	
                (b)

              	
                the
                  amount of any Realized Losses and Unpaid Realized Loss
                  Amounts;

              

      

      

      
        	 	
                (c)

              	
                the
                  application of the amounts distributed on such Distribution Date
                  pursuant
                  to Section 4.1 hereof (including the distribution of any Subsequent
                  Recoveries); 

              

      

      

      
        	 	
                (d)

              	
                whether
                  a Trigger Event has occurred; and

              

      

      

      Section
        4.5 Reports
        by or on Behalf of the Servicer.

      

      (a) On
        or as
        soon as practicable following each Distribution Date, the Servicer shall
        report
        or cause to be published on the Trustee’s website located at
        https://www.tss.db.com/invr, or such other website designated by the Trustee
        as
        may be set forth in a notice provided to the Holder of each of the Certificates
        and each Rating Agency, the following information: 

      

      
        
          
          

        

        
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      (i) with
        respect to each Class of Certificates (other than Class OC and Class R) (based
        on a Certificate in the original principal amount of $1,000):

      

      
        	 	
                (A)

              	
                the
                  amount of the aggregate distributions on such Distribution
                  Date;

              

      

       

      (B)   the
        amount of such distribution allocable to interest;

      

      
        	 	
                (C)

              	
                the
                  amount of such distributions allocable to principal, separately
                  identifying the aggregate amount of any prepayments, Substitution
                  Adjustment Amounts, repurchase amounts pursuant to Article 2 or
                  other
                  recoveries of principal included therein, any Extra Principal Distribution
                  Amount for such Distribution Date;

              

      

      

      
        	 	
                (D)

              	
                the
                  Class Principal Balance after giving effect to any distribution
                  allocable
                  to principal; and

              

      

      

      
        	 	
                (E)

              	
                any
                  Interest Carry Forward Amount and any Basis Risk Carry Forward
                  Amount;

              

      

      

      (ii) the
        Net
        WAC Cap applicable to each Class of Certificates;

      

      (iii) any
        Subsequent Recoveries and Realized Losses for the period and since the Cut-off
        Date;

      

      (iv) the
        largest Mortgage Loan balance outstanding in each Group;

      

      (v) Prepayment
        Penalties collected and owed;

      

      (vi) the
        Servicing Fees allocable to each Group, and any fees paid to the Trustee
        or the
        Custodian;

      

      (vii) One-Month
        LIBOR on the most recent Interest Determination Date; 

      

      (viii) the
        Pass-Through Rates for the Certificates for the current Interest Accrual
        Period
        and whether such rates have been capped; 

      

      (ix) the
        number and aggregate principal balances of Mortgage Loans in each Group (a)
        30-59 days Delinquent, (b) 60-89 days Delinquent and (c) 90 or more days
        Delinquent, as of the close of business as of the end of the related prepayment
        period;

      

      (x) the
        percentage that each of the Stated Principal Balances set forth pursuant
        to
        clauses (a), (b) and (c) of paragraph (ix) above represent with respect to
        all
        Mortgage Loans in each Group;

      

      (xi) the
        number and Stated Principal Balance of all Mortgage Loans in each Group in
        foreclosure proceedings as of the close of business as of the end of the
        related
        Prepayment Period and in the immediately preceding Prepayment
        Period;

      

      
        
          
          

        

        
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      (xii) the
        number of Mortgagors and the Stated Principal Balances of Mortgage Loans
        in each
        Group involved in bankruptcy proceedings as of the close of business as of
        the
        end of the related Prepayment Period;

      

      (xiii) the
        aggregate number and aggregate book value of any REO Property in each Group
        as
        of the close of business as of the end of the related Prepayment Period;
        

      

      (xiv) the
        number and amount by principal balance of 60+ Day Delinquent Loans in each
        Group
        as of the end of the related Prepayment Period; 

      

      (xv) the
        aggregate Stated Principal Balance of the Mortgage Loans, the Mortgage Rates
        (in
        incremental ranges), the Weighted Average Net Rate, the weighted average
        life
        and the weighted average remaining term of the Mortgage Loans, at the beginning
        and at the end of the related Prepayment Period;

      

      (xvi) the
        Stated Principal Balance of the Mortgage Loans whose Mortgage Rates adjust
        on
        the basis of six-month LIBOR at the end of the related Prepayment
        Period;

      

      (xvii) the
        amount of cash flow received for such Distribution Date, and the sources
        thereof;

      

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

      

      (xix) the
        applicable Record Date, Interest Accrual Period and calculation date for
        each
        Class of Certificates and such Distribution Date; 

      

      (xx) the
        amount on deposit in the Distribution Account as of such Distribution Date
        (after giving effect to distributions on such date) and as of the prior
        Distribution Date; and 

      

      (xxi) the
        amount of any payments under the Swap Agreement.

      

      (b) All
        allocations made by the Trustee shall be based on information the Trustee
        receives from the Servicer which the Trustee shall be protected in relying
        on.

      

      In
        addition to the information listed above, such report shall also include
        such
        other information as is required by Form 10-D, including, but not limited
        to,
        the information required by Item 1121 (§ 229.1121) of Regulation AB, to the
        extent such information is provided to the Trustee on a timely basis by the
        responsible party as set forth in Exhibit S.

      

      Section
        4.6 The
        Calculation Agent.

      

      (a) The
        Calculation Agent, as agent for the Servicer, shall timely and accurately
        (i)
        perform and provide to the Trustee calculations of all amounts of principal
        and
        interest required to be distributed on each Distribution Date pursuant to
        this
        Article 4; and (ii) in connection with such calculations, determine the
        appropriate One Month LIBOR with respect to each Interest Determination Date
        in
        accordance with the definition of “One Month LIBOR” set forth in Section 1.1.
        The Calculation Agent shall not resign from its capacity as the Calculation
        Agent on fewer than sixty (60) prior written days notice to the
        Servicer.

      

      
        
          
          

        

        
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      (b) The
        compensation of the Calculation Agent shall be the responsibility of the
        Servicer, payable from the Servicing Fee.

      

      (c) The
        Servicer may terminate the Calculation Agent, in its capacity as the Calculation
        Agent, at any time, with or without cause, upon thirty (30) days notice in
        writing to the Calculation Agent. No fee shall be payable to the Calculation
        Agent in connection with any such termination. 

      

      Section
        4.7 The
        Excess Reserve Fund Account.

      

      (a) The
        Trustee shall establish and maintain an Excess Reserve Fund Account to be
        held
        in trust for the benefit of Holders of the Certificates. The Excess Reserve
        Fund
        Account shall at all times be an Eligible Account. On each Distribution Date,
        the Trustee shall deposit in the Excess Reserve Fund Account all amounts
        received on the Cap Agreement since the preceding Distribution Date. Amounts
        on
        deposit in the Excess Reserve Fund Account shall be invested at the direction
        of
        the Depositor on behalf of the Holders of the Class OC Certificate. Investments
        in the Excess Reserve Fund Account shall be limited to Permitted
        Investments.

      

      (b) The
        Excess Reserve Fund Account shall not be an asset of any REMIC created pursuant
        to this Agreement. For state and federal tax purposes, the Holder of the
        Class
        OC Certificate shall be the beneficial owner of the Excess Reserve Fund
        Account.

      

      Section
        4.8 The
        Supplemental Interest Trust.

      

      (a) A
        separate trust is hereby established (the “Supplemental Interest Trust” or the
“Saxon Asset Securities Trust 2007-1 Supplemental Interest Trust”), the corpus
        of which shall be held by the Trustee in trust for the benefit of the
        Certificateholders. The Trustee shall be the trustee of the Supplemental
        Interest Trust. The Trustee, as trustee of the Supplemental Interest Trust,
        shall establish an account (the “Swap Account”). The Swap Account shall be an
        Eligible Account, and funds on deposit therein shall be held separate and
        apart
        from, and shall not be commingled with, any other moneys, including, without
        limitation, other moneys of the Trustee held pursuant to this Agreement.
        The
        Supplemental Interest Trust will not be an asset of any REMIC
        hereunder.

      

      (b) On
        each
        Distribution Date, Swap Termination Payments, Net Swap Payments owed to the
        Swap
        Counterparty and Net Swap Receipts will be deposited into the Swap Account.
        Funds in the Swap Account will be distributed in the following order of
        priority:

      

      (i) to
        the
        Swap Counterparty, all Net Swap Payments, if any, owed to the Swap Counterparty
        for that Distribution Date;

      

      (ii) to
        the
        Swap Counterparty, any Swap Termination Payment, but not including any Defaulted
        Swap Termination Payment, for that Distribution Date;

      

      
        
          
          

        

        
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      (iii) concurrently,
        to the Senior Certificates, pro rata, any unpaid Senior Interest Distribution
        Amount remaining unpaid after distribution of the Interest Remittance Amount
        and
        any unpaid Interest Carry Forward Amounts;

      

      (iv) sequentially,
        to the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6,
        Class
        B-1, Class B-2 and Class B-3 Certificates, in that order, any unpaid Subordinate
        Interest Distribution Amount remaining unpaid after distribution of the Interest
        Remittance Amount and any unpaid Interest Carry Forward Amounts;

      

      (v) to
        the
        Offered Certificates in accordance with the principal distribution rules
        in
        effect for such Distribution Date, in an amount equal to the amount necessary
        to
        meet the Overcollateralization Target for that Distribution Date (to the
        extent
        remaining unpaid from the Available Distribution Amount);

      

      (vi) concurrently,
        to the Senior Certificates, pro rata, in an amount up to their respective
        Swap
        Payment Allocations for that Distribution Date, any remaining Basis Risk
        Carry
        Forward Amounts, to the extent unpaid from funds on deposit in the Excess
        Reserve Fund Account;

      

      (vii) sequentially,
        to the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6,
        Class
        B-1, Class B-2 and Class B-3 Certificates, in that order, in an amount up
        to
        their respective Swap Payment Allocations for that Distribution Date, any
        remaining Basis Risk Carry Forward Amounts, to the extent unpaid from funds
        on
        deposit in the Excess Reserve Fund Account;

      

      (viii) concurrently,
        to the Offered Certificates, pro rata by need, any remaining Basis Risk Carry
        Forward Amounts, to the extent unpaid;

      

      (ix) sequentially
        to the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6,
        Class
        B-1, Class B-2 and Class B-3 Certificates, in that order, any remaining Unpaid
        Realized Loss Amounts;

      

      (x) sequentially,
        first (i) concurrently, to the Senior Certificates, first
        pro
        rata, based on their respective Class Principal Balances to the extent needed
        to
        pay any Unpaid Interest Shortfall Amount for each such Class and then,
        pro
        rata, based on any Unpaid Interest Shortfall Amount remaining unpaid for
        each
        such Class, in an amount up to the amount of any Unpaid Interest Shortfall
        Amount remaining unpaid for such Classes of Certificates and then (ii)
        sequentially, to the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5,
        Class M-6, Class B-1, Class B-2 and Class B-3 Certificates, in that order,
        in an
        amount up to the amount of any Unpaid Interest Shortfall Amount for such
        Classes
        of Certificates;

      

      (xi) to
        the
        Swap Counterparty, any Defaulted Swap Termination Payment owed to the Swap
        Counterparty for that Distribution Date; and

      

      (xii) all
        remaining amounts to the holder of the Class OC Certificates.

      

      
        
          
          

        

        
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      Notwithstanding
        the foregoing, in the event that the Trust receives a Swap Termination Payment,
        the Trustee shall use the Swap Termination Payment to enter into a replacement
        interest rate swap agreement as directed by the Depositor with a successor
        swap
        counterparty (or its guarantor) meeting the ratings requirements set forth
        in
        the Swap Agreement being terminated on the same remaining terms as those
        in the
        Swap Agreement being terminated, so long as the Swap Termination Payment
        is
        sufficient to obtain such replacement interest rate swap agreement. In the
        event
        that the Trust receives a Swap Termination Payment, and a successor swap
        counterparty (or its guarantor) cannot be obtained, then the Trustee shall
        be
        required to deposit any Swap Termination Payment into the reserve account
        that
        is a sub-account of the Swap Account. On each subsequent Distribution Date
        (so
        long as funds are available in such reserve account), the Trustee will be
        required to withdraw from the reserve account and deposit into the Swap Account
        an amount equal to the amount of any Net Swap Receipt due the trust (calculated
        in accordance with the terms of the original Swap Agreement) and treat such
        amount as a Net Swap Receipt for purposes of determining the distributions
        from
        the Swap Account. The remaining amount in the reserve account shall remain
        in
        that account and not treated as a Swap Termination Payment for purposes of
        determining the distributions from the Swap Account until the final Distribution
        Date.

      

      In
        the
        event that, upon the Supplemental Interest Trust entering into a replacement
        interest rate swap, the Trust is entitled to receive a Replacement Swap
        Counterparty Payment from a replacement swap provider, such replacement interest
        rate swap shall provide that the replacement swap counterparty shall make
        such
        Replacement Swap Counterparty Payment to the Swap Account, which obligation
        shall be enforced by the Trustee pursuant to the terms of such replacement
        interest rate swap. Notwithstanding the foregoing, any Replacement Swap
        Counterparty Payment shall be made from the Swap Account to the Swap
        Counterparty immediately upon receipt of such payment, regardless of whether
        the
        date of receipt thereof is a Distribution Date. To the extent that any
        Replacement Swap Counterparty Payment is made to an account other than the
        Swap
        Account, then, notwithstanding anything to the contrary contained in this
        Agreement, any Replacement Swap Counterparty Payment shall be paid to the
        Swap
        Counterparty immediately upon receipt of such Replacement Swap Counterparty
        Payment by the Trust, regardless of whether the date of receipt thereof is
        a
        Distribution Date and without regard to anything to the contrary contained
        in
        this Agreement. For the avoidance of doubt, the parties agree that the Swap
        Counterparty shall have first priority to any Replacement Swap Counterparty
        Payment over the payment by the Trust to Certificateholders, any Servicer,
        the
        Custodian, the Trustee or any other Person. However, to the extent any
        Replacement Swap Counterparty Payment received from a replacement swap
        counterparty and paid to the Swap Counterparty being replaced is less than
        the
        full amount of a Swap Termination Payment owed to the Swap Counterparty ,
        any
        remaining amount of the Swap Termination Payment shall be paid to the Swap
        Counterparty on subsequent Distribution Dates in accordance with this Section
        4.8 and Section 4.1 (unless the Replacement Swap Counterparty Payment is
        paid to
        the Swap Counterparty on a Distribution Date, in which case such remaining
        amounts will be paid on such Distribution Date).

      

      (c) Funds
        in
        the Swap Account shall be invested in Permitted Investments. Any earnings
        on
        such amounts shall be added to the amounts distributed on each Distribution
        Date
        pursuant to Section 4.10(b). The Class OC Certificates shall evidence ownership
        of the Swap Account for federal income tax purposes and the Depositor on
        behalf
        of the Holder thereof shall direct the Trustee, in writing, as to investment
        of
        amounts on deposit therein. The Depositor shall be liable for any losses
        incurred on such investments.

      

      
        
          
          

        

        
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      (d) Upon
        termination of the Trust, any amounts remaining in the Swap Account shall
        be
        distributed to the Class OC Certificates.

      

      (e) It
        is the
        intention of the parties hereto that, for federal and state income and state
        and
        local franchise tax purposes, the Supplemental Interest Trust be disregarded
        as
        an entity separate from the holder of the Class OC Certificates unless and
        until
        the date when either (a) there is more than one Class OC Certificateholder
        or (b) any Class of Certificates in addition to the Class OC Certificates
        is recharacterized as an equity interest in the Supplemental Interest Trust
        for
        federal income tax purposes. The Trustee shall not be responsible for any
        entity
        level tax reporting for the Supplemental Interest Trust.

      

      To
        the
        extent that the Supplemental Interest Trust is determined to be a separate
        legal
        entity from the Trustee, any obligation of the Trustee under the Swap Agreement
        shall be deemed to be an obligation of the Supplemental Interest
        Trust.

      

      ARTICLE
        5

      

      THE
        CERTIFICATES

      

      Section
        5.1 The
        Certificates.

      

      The
        Certificates shall be substantially in the forms attached as exhibits hereto.
        The Certificates shall be issuable in registered form, in the minimum
        denominations, integral multiples in excess thereof (except that one Certificate
        in each Class may be issued in a different amount which must be in excess
        of the
        applicable minimum denomination) and aggregate denominations per Class set
        forth
        in the Preliminary Statement.

      

      Subject
        to Section 9.2 hereof respecting the final distribution on the Certificates,
        on
        each Distribution Date the Trustee shall make distributions to each
        Certificateholder of record on the preceding Record Date either (x) by wire
        transfer in immediately available funds to the account of such Holder at
        a bank
        or other entity having appropriate facilities therefor, if (i) such Holder
        has
        so notified the Trustee at least five Business Days prior to the related
        Record
        Date and (ii) such Holder shall hold (A) 100% of the Class Principal Balance
        of
        any Class of Certificates or (B) Certificates of any Class with aggregate
        principal Denominations of not less than $1,000,000 or (y) by check mailed
        by
        first class mail to such Certificateholder at the address of such Holder
        appearing in the Certificate Register.

      

      The
        Certificates shall be executed by manual or facsimile signature on behalf
        of the
        Trustee by an authorized officer. Certificates bearing the manual or facsimile
        signatures of individuals who were, at the time when such signatures were
        affixed, authorized to sign on behalf of the Trustee shall bind the Trustee,
        notwithstanding that such individuals or any of them have ceased to be so
        authorized prior to the countersignature and delivery of such Certificates
        or
        did not hold such offices at the date of such Certificate. No Certificate
        shall
        be entitled to any benefit under this Agreement, or be valid for any purpose,
        unless countersigned by the Trustee by manual signature, and such
        countersignature upon any Certificate shall be conclusive evidence, and the
        only
        evidence, that such Certificate has been duly executed and delivered hereunder.
        All Certificates shall be dated the date of their countersignature. On the
        Closing Date, the Trustee shall countersign the Certificates to be issued
        at the
        direction of the Depositor, or any affiliate thereof.

      

      
        
          
          

        

        
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      The
        Depositor shall provide, or cause to be provided, to the Trustee on a continuous
        basis, an adequate inventory of Certificates to facilitate
        transfers.

      

      Section
        5.2 Certificate
        Register; Registration of Transfer and Exchange of Certificates.

      

      (a) The
        Trustee shall maintain, or cause to be maintained in accordance with the
        provisions of Section 5.6 hereof, a Certificate Register for the Trust Fund
        in
        which, subject to the provisions of subsections (b) and (c) below and to
        such
        reasonable regulations as it may prescribe, the Trustee shall provide for
        the
        registration of Certificates and of transfers and exchanges of Certificates
        as
        herein provided. Upon surrender for registration of transfer of any Certificate,
        the Trustee shall execute and deliver, in the name of the designated transferee
        or transferees, one or more new Certificates of the same Class and aggregate
        Percentage Interest.

      

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

      

      No
        service charge to the Certificateholders shall be made for any registration
        of
        transfer or exchange of Certificates, but payment of a sum sufficient to
        cover
        any tax or governmental charge that may be imposed in connection with any
        transfer or exchange of Certificates may be required.

      

      All
        Certificates surrendered for registration of transfer or exchange shall be
        cancelled and subsequently destroyed by the Trustee in accordance with the
        Trustee’s customary procedures.

      

      (b) No
        Person
        shall transfer a Private Certificate unless such transfer (i) is made pursuant
        to an effective registration statement under the Securities Act and any
        applicable state securities laws, or (ii) is exempt from the registration
        requirements under said Act and such state securities laws. In the event
        that a
        transfer is to be made in reliance upon an exemption from the Securities
        Act and
        such laws, in order to assure compliance with the Securities Act and such
        laws,
        the Certificateholder desiring to effect such transfer and such
        Certificateholder’s prospective transferee shall each certify to the Trustee in
        writing the facts surrounding the transfer in substantially the forms set
        forth
        in Exhibit F (the “Transferor Certificate”) and (i) deliver a letter in
        substantially the form of either Exhibit G (the “Investment Letter”) or Exhibit
        H (the “Rule 144A Letter”) or (ii) there shall be delivered to the Trustee at
        the expense of the transferor an Opinion of Counsel that such transfer may
        be
        made pursuant to an exemption from the Securities Act. The Depositor shall
        provide to any Holder of a Private Certificate and any prospective transferee
        designated by any such Holder, information regarding the related Certificates
        and the Mortgage Loans and such other information as shall be necessary to
        satisfy the condition to eligibility set forth in Rule 144A(d)(4) for transfer
        of any such Certificate without registration thereof under the Securities
        Act
        pursuant to the registration exemption provided by Rule 144A. The Trustee
        and
        the Servicer shall cooperate with the Depositor in providing the Rule 144A
        information referenced in the preceding sentence, including providing to
        the
        Depositor such information regarding the Certificates, the Mortgage Loans
        and
        other matters regarding the Trust Fund as the Depositor shall reasonably
        request
        to meet its obligation under the preceding sentence. Each Holder of a Private
        Certificate desiring to effect such transfer shall, and does hereby agree
        to,
        indemnify the Trustee and the Depositor, the Depositor and the Servicer against
        any liability that may result if the transfer is not so exempt or is not
        made in
        accordance with such federal and state laws.

      

      
        
          
          

        

        
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      No
        transfer of an ERISA-Restricted Certificate shall be made unless the Trustee
        shall have received either (i) a representation from the transferee of such
        Certificate acceptable to and in form and substance satisfactory to the Trustee
        (in the event such Certificate is a Private Certificate, such requirement
        is
        satisfied only by the Trustee’s receipt of a representation letter from the
        transferee substantially in the form of Exhibit G-1), to the effect that
        such
        transferee is not an employee benefit plan or arrangement subject to Section
        406
        of ERISA, as amended, or a plan or arrangement subject to Section 4975 of
        the
        Code, or a person acting on behalf of any such plan or arrangement, or using
        the
        assets of any such plan or arrangement to effect such transfer (collectively
        a
“Benefit Plan Investor”), (ii) if the purchaser is an insurance company, a
        representation in the form of Exhibit G-2 that (a) the purchaser is an insurance
        company which is purchasing such Certificates pursuant to an ERISA-Qualifying
        Underwriting with funds contained in an “insurance company general account” (as
        such term is defined in Section V(e) of Prohibited Transaction Class Exemption
        (“PTCE”) 95-60) and (b) all of the requirements of PTCE 95-60 are met, or (iii)
        in the case of any such ERISA-Restricted Certificate presented for registration
        in the name of a Benefit Plan Investor, an Opinion of Counsel satisfactory
        to
        the Trustee, which Opinion of Counsel shall not be an expense of either the
        Trustee or the Trust Fund, addressed to the Trustee to the effect that the
        purchase or holding of such ERISA-Restricted Certificate will not result
        in
        prohibited transactions under Title I of ERISA and/or Section 4975 of the
        Code
        and will not subject the Servicer, the Trustee or the Underwriter to any
        obligation in addition to those expressly undertaken in this Agreement.
        Notwithstanding anything else to the contrary herein, any purported transfer
        of
        an ERISA-Restricted Certificate to a Benefit Plan Investor without the above
        representations or the delivery to the Trustee of an Opinion of Counsel
        satisfactory to the Trustee as described above shall be void and of no effect.
        Any representations required to be made in subsection (i) and (ii) above
        in the
        case of ERISA-Restricted Certificates which are the Book-Entry-Certificates
        shall be deemed to have been made by the acquisition of such
        Certificates.

      

      No
        transfer of an ERISA-Restricted Swap Certificate prior to the termination
        of the
        Swap Agreement shall be made unless the Trustee shall have received a
        representation letter from the transferee of such Certificate, substantially
        in
        the form set forth in Exhibit G-2, to the effect that either (i) such transferee
        is not a Benefit Plan Investor or (ii) the acquisition and holding of the
        ERISA-Restricted Swap Certificate are eligible for exemptive relief under
        PTCE
        84-14, PTCE 90-1, PTCE 91-38, PTCE 95-60 or PTCE 96-23. Notwithstanding anything
        else to the contrary herein, any purported transfer of an ERISA-Restricted
        Swap
        Certificate prior to the termination of the Swap Agreement to or on behalf
        of a
        Benefit Plan Investor without the delivery to the Trustee of a representation
        letter as described above shall be void and of no effect. If the
        ERISA-Restricted Swap Certificate is a Book-Entry Certificate, the transferee
        will be deemed to have made a representation as provided in clause (i) or
        (ii)
        of this paragraph, as applicable.

      

      
        
          
          

        

        
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      If
        any
        ERISA-Restricted Swap Certificate, or any interest therein, is acquired or
        held
        in violation of the provisions of the preceding paragraph, the next preceding
        permitted beneficial owner will be treated as the beneficial owner of that
        Certificate, retroactive to the date of transfer to the purported beneficial
        owner. Any purported beneficial owner whose acquisition or holding of an
        ERISA-Restricted Swap Certificate, or interest therein, was effected in
        violation of the provisions of the preceding paragraph shall indemnify to
        the
        extent permitted by law and hold harmless the Depositor, the Trustee and
        the
        Servicer from and against any and all liabilities, claims, costs or expenses
        incurred by such parties as a result of such acquisition or
        holding.

      

      To
        the
        extent permitted under applicable law (including, but not limited to, ERISA),
        the Trustee shall be under no liability to any Person for any registration
        of
        transfer of any ERISA-Restricted Certificate or ERISA-Restricted Swap
        Certificate that is in fact not permitted by this Section 5.2(b) or for making
        any payments due on such Certificate to the Holder thereof or taking any
        other
        action with respect to such Holder under the provisions of this Agreement
        so
        long as the transfer was registered by the Trustee in accordance with the
        foregoing requirements.

      

      No
        transfer of any Private Certificate presented or surrendered for registration
        of
        transfer or exchange shall be made unless the transfer or exchange is
        accompanied by a written instrument of transfer and accompanied by IRS Form
        W-8ECI, W-8BEN, W-8IMY (and all appropriate attachments) or W-9 duly executed
        by
        the Certificateholder or its representative or nominee duly authorized in
        writing. The Trustee shall promptly forward any such IRS Form (other than
        with
        respect to the Residual Certificates) received to the Swap Counterparty located
        at 1585 Broadway New York, New York 10036, Attention: NY ISD SPV Team, Fax:
        (212) 507-7754. Each Holder of a Private Certificate and each transferee
        thereof
        shall be deemed to have consented to the Trustee forwarding to the Swap
        Counterparty any such tax certification form such Certificateholder or
        transferee has provided and updated in accordance with these transfer
        restrictions by its purchase of such Private Certificate. The Trustee shall
        not
        be liable for the completeness, accuracy, content or truthfulness of any
        such
        tax certification provided to it.

      

      (c) Each
        Person who has or who acquires any Ownership Interest in a Residual Certificate
        shall be deemed by the acceptance or acquisition of such Ownership Interest
        to
        have agreed to be bound by the following provisions, and the rights of each
        Person acquiring any Ownership Interest in a Residual Certificate are expressly
        subject to the following provisions:

      

      (i) Each
        Person holding or acquiring any Ownership Interest in a Residual Certificate
        shall be a Permitted Transferee.

      

      (ii) No
        Ownership Interest in a Residual Certificate may be registered on the Closing
        Date or thereafter transferred, and the Trustee shall not register the Transfer
        of any Residual Certificate unless, in addition to the certificates required
        to
        be delivered to the Trustee under subparagraph (b) above, the Trustee shall
        have
        been furnished with an affidavit (a “Transfer Affidavit”) of the initial owner
        or the proposed transferee in the form attached hereto as Exhibit
        E.

      

      
        
          
          

        

        
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      (iii) Each
        Person holding or acquiring any Ownership Interest in a Residual Certificate
        shall agree (A) to obtain a Transfer Affidavit from any other Person to whom
        such Person attempts to Transfer its Ownership Interest in a Residual
        Certificate, (B) to obtain a Transfer Affidavit from any Person for whom
        such
        Person is acting as nominee, trustee or agent in connection with any Transfer
        of
        a Residual Certificate and (C) not to Transfer its Ownership Interest in
        a
        Residual Certificate or to cause the Transfer of an Ownership Interest in
        a
        Residual Certificate to any other Person if it has actual knowledge that
        such
        Person is not a Permitted Transferee.

      

      (iv) Any
        attempted or purported Transfer of any Ownership Interest in a Residual
        Certificate in violation of the provisions of this Section 5.2(c) shall be
        absolutely null and void and shall vest no rights in the purported Transferee.
        If any purported transferee shall become a Holder of a Residual Certificate
        in
        violation of the provisions of this Section 5.2(c), then the last preceding
        Permitted Transferee shall be restored to all rights as Holder thereof
        retroactive to the date of registration of Transfer of such Residual
        Certificate. The Trustee shall be under no liability to any Person for any
        registration of Transfer of a Residual Certificate that is in fact not permitted
        by Section 5.2(b) and this Section 5.2(c) or for making any payments due
        on such
        Certificate to the Holder thereof or taking any other action with respect
        to
        such Holder under the provisions of this Agreement so long as the Transfer
        was
        registered after receipt of the related Transfer Affidavit, Transferor
        Certificate and either the Rule 144A Letter or the Investment Letter. The
        Trustee shall be entitled but not obligated to recover from any Holder of
        a
        Residual Certificate that was in fact not a Permitted Transferee at the time
        it
        became a Holder or, at such subsequent time as it became other than a Permitted
        Transferee, all payments made on such Residual Certificate at and after either
        such time. Any such payments so recovered by the Trustee shall be paid and
        delivered by the Trustee to the last preceding Permitted Transferee of such
        Certificate.

      

      (v) The
        Depositor shall make available, upon receipt of written request from the
        Trustee, all information necessary to compute any tax imposed under Section
        860E(e) of the Code as a result of a Transfer of an Ownership Interest in
        a
        Residual Certificate to any Holder who is not a Permitted
        Transferee.

      

      The
        restrictions on Transfers of a Residual Certificate set forth in this Section
        5.2(c) shall cease to apply (and the applicable portions of the legend on
        a
        Residual Certificate may be deleted) with respect to Transfers occurring
        after
        delivery to the Trustee of an Opinion of Counsel, which Opinion of Counsel
        shall
        not be an expense of the Trust Fund, the Trustee, the Depositor or the Servicer,
        to the effect that the elimination of such restrictions will not cause an
        Adverse REMIC Event. Each Person holding or acquiring any Ownership Interest
        in
        a Residual Certificate hereby consents to any amendment of this Agreement
        which,
        based on an Opinion of Counsel furnished to the Trustee, is reasonably necessary
        (a) to ensure that the record ownership of, or any beneficial interest in,
        a
        Residual Certificate is not transferred, directly or indirectly, to a Person
        that is not a Permitted Transferee and (b) to provide for a means to compel
        the
        Transfer of a Residual Certificate which is held by a Person that is not
        a
        Permitted Transferee to a Holder that is a Permitted Transferee.

      

      
        
          
          

        

        
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      (d) The
        preparation and delivery of all certificates and opinions referred to above
        in
        this Section 5.2 in connection with transfer shall be at the expense of the
        parties to such transfers.

      

      (e) Except
        as
        provided below, the Book-Entry Certificates shall at all times remain registered
        in the name of the Depository or its nominee and at all times: (i) registration
        of the Certificates may not be transferred by the Trustee except to another
        Depository; (ii) the Depository shall maintain book-entry records with respect
        to the Certificate Owners and with respect to ownership and transfers of
        such
        Book-Entry Certificates; (iii) ownership and transfers of registration of
        the
        Book-Entry Certificates on the books of the Depository shall be governed
        by
        applicable rules established by the Depository; (iv) the Depository may collect
        its usual and customary fees, charges and expenses from its Depository
        Participants; (v) the Trustee shall deal with the Depository, Depository
        Participants and indirect participating firms as representatives of the
        Certificate Owners of the Book-Entry Certificates for purposes of exercising
        the
        rights of holders under this Agreement, and requests and directions for and
        votes of such representatives shall not be deemed to be inconsistent if they
        are
        made with respect to different Certificate Owners; and (vi) the Trustee may
        rely
        and shall be fully protected in relying upon information furnished by the
        Depository with respect to its Depository Participants and furnished by the
        Depository Participants with respect to indirect participating firms and
        persons
        shown on the books of such indirect participating firms as direct or indirect
        Certificate Owners.

      

      All
        transfers by Certificate Owners of Book-Entry Certificates shall be made
        in
        accordance with the procedures established by the Depository Participant
        or
        brokerage firm representing such Certificate Owner. Each Depository Participant
        shall only transfer 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.

      

      If
        (x)
        (i) the Depository or the Depositor advises the Trustee in writing that the
        Depository is no longer willing or able to properly discharge its
        responsibilities as Depository, and (ii) the Trustee or the Depositor is
        unable
        to locate a qualified successor or (y) after the occurrence of an Event of
        Default, Certificate Owners representing at least 51% of the Class Principal
        Balance of the Book-Entry Certificates together advise the Trustee and the
        Depository through the Depository Participants in writing that the continuation
        of a book-entry system through the Depository is no longer in the best interests
        of the Certificate Owners, the Trustee shall notify all Certificate Owners,
        through the Depository, of the occurrence of any such event and of the
        availability of definitive, fully-registered Certificates (the “Definitive
        Certificates”) to Certificate Owners requesting the same. Upon surrender to the
        Trustee of the related Class of Certificates by the Depository, accompanied
        by
        the instructions from the Depository for registration, the Trustee shall
        issue
        the Definitive Certificates. Neither the Servicer, the Depositor nor the
        Trustee
        shall be liable for any delay in delivery of such instruction and each may
        conclusively rely on, and shall be protected in relying on, such instructions.
        The Servicer shall provide the Trustee with an adequate inventory of
        certificates to facilitate the issuance and transfer of Definitive Certificates.
        Upon the issuance of Definitive Certificates all references herein to
        obligations imposed upon or to be performed by the Depository shall be deemed
        to
        be imposed upon and performed by the Trustee, to the extent applicable with
        respect to such Definitive Certificates and the Trustee shall recognize the
        Holders of the Definitive Certificates as Certificateholders hereunder; provided
        that the Trustee shall not by virtue of its assumption of such obligations
        become liable to any party for any act or failure to act of the
        Depository.

      

      
        
          
          

        

        
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      Section
        5.3 Mutilated,
        Destroyed, Lost or Stolen Certificates.

      

      If
        (a)
        any mutilated Certificate is surrendered to the Trustee, or the Trustee receives
        evidence to its satisfaction of the destruction, loss or theft of any
        Certificate and (b) there is delivered to the Servicer and the Trustee such
        security or indemnity as may be required by them to save each of them harmless,
        then, in the absence of notice to the Trustee that such Certificate has been
        acquired by a bona fide purchaser, the Trustee shall execute, countersign
        and
        deliver, in exchange for or in lieu of any such mutilated, destroyed, lost
        or
        stolen Certificate, a new Certificate of like Class, tenor and Percentage
        Interest. In connection with the issuance of any new Certificate under this
        Section 5.3, the Trustee may require the payment of a sum sufficient to cover
        any tax or other governmental charge that may be imposed in relation thereto
        and
        any other expenses (including the fees and expenses of the Trustee) connected
        therewith. Any replacement Certificate issued pursuant to this Section 5.3
        shall
        constitute complete and indefeasible evidence of ownership, as if originally
        issued, whether or not the lost, stolen or destroyed Certificate shall be
        found
        at any time.

      

      Section
        5.4 Persons
        Deemed Owners.

      

      The
        Trustee and any agent of the Trustee may treat the Person in whose name any
        Certificate is registered as the owner of such Certificate for the purpose
        of
        receiving distributions as provided in this Agreement and for all other purposes
        whatsoever, and neither the Trustee nor any agent of the Trustee shall be
        affected by any notice to the contrary.

      

      Section
        5.5 Access
        to List of Certificateholders’ Names and Addresses.

      

      If
        three
        or more Certificateholders (a) request such information in writing from the
        Trustee, (b) state that such Certificateholders desire to communicate with
        other
        Certificateholders with respect to their rights under this Agreement or under
        the Certificates, and (c) provide a copy of the communication which such
        Certificateholders propose to transmit, or if the Depositor or Servicer shall
        request such information in writing from the Trustee, then the Trustee shall,
        within ten Business Days after the receipt of such request, provide the
        Depositor, the Servicer or such Certificateholders at such recipients’ expense
        the most recent list of the Certificateholders of such Trust Fund held by
        the
        Trustee, if any. The Depositor and every Certificateholder, by receiving
        and
        holding a Certificate, agree that the Trustee shall not be held accountable
        by
        reason of the disclosure of any such information as to the list of the
        Certificateholders hereunder, regardless of the source from which such
        information was derived.

      

      Section
        5.6 Maintenance
        of Office or Agency.

      

      The
        Trustee will maintain or cause to be maintained at its expense an office
        or
        offices or agency or agencies where Certificates may be surrendered for
        registration of transfer or exchange. The Trustee initially designates its
        office DB Services Tennessee, 648 Grassmere Park Road, Nashville, Tennessee
        37211-3658; Attention: Transfer Unit, for such purposes. The Trustee will
        give
        prompt written notice to the Certificateholders of any change in such location
        of any such office or agency.

      

      
        
          
          

        

        
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      ARTICLE
        6

      

      THE
        DEPOSITOR AND THE SERVICER

      

      Section
        6.1 Respective
        Liabilities of the Depositor and the Servicer.

      

      The
        Depositor and Servicer shall each be liable in accordance herewith only to
        the
        extent of the obligations specifically and respectively imposed upon and
        undertaken by them herein.

      

      Section
        6.2 Merger
        or Consolidation of the Depositor and Servicer.

      

      The
        Depositor and Servicer will each keep in full effect its existence, rights
        and
        franchises as a corporation (or, in the case of the Servicer, a limited
        partnership) under the laws of the United States or under the laws of one
        of the
        states thereof 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, or any of the Mortgage Loans and to perform
        its respective duties under this Agreement.

      

      Any
        Person into which the Depositor or the Servicer may be merged or consolidated,
        or any Person resulting from any merger or consolidation to which the Depositor
        or the Servicer shall be a party, or any person succeeding to the business
        of
        the Depositor or the Servicer, shall be the successor of the Depositor or
        the
        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 Servicer shall be qualified to sell mortgage loans
        to,
        and to service mortgage loans on behalf of, Fannie Mae or Freddie
        Mac.

      

      Section
        6.3 Limitation
        on Liability of the Depositor, the Servicer and Others.

      

      None
        of
        the Depositor, the Servicer or any of the directors, officers, employees
        or
        agents of the Depositor or the Servicer shall be under any liability to the
        Certificateholders for any action taken or for refraining from the taking
        of any
        action in good faith pursuant to this Agreement, or for errors in judgment;
        provided, however, that this provision shall not protect the Depositor, the
        Servicer or any such Person against any breach of representations or warranties
        made by it herein or protect the Depositor, the Servicer or any such Person
        from
        any liability which would otherwise be imposed by reasons of willful
        misfeasance, bad faith or negligence in the performance of duties or by reason
        of reckless disregard of obligations and duties hereunder. The Depositor,
        the
        Servicer and any director, officer, employee or agent of the Depositor or
        the
        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 Servicer and any director, officer, employee or agent
        of the
        Depositor or the Servicer shall be indemnified by the Trust Fund and held
        harmless against any loss, liability or expense incurred in connection with
        any
        audit, controversy or judicial proceeding relating to a governmental taxing
        authority or any legal action relating to this Agreement or the performance
        thereof, 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 negligence in the performance of duties hereunder or by reason
        of
        reckless disregard of obligations and duties hereunder. None of the Depositor
        or
        the Servicer shall be under any obligation to appear in, prosecute or defend
        any
        legal action that is not incidental to its respective duties hereunder and
        which
        in its opinion may involve it in any expense or liability; provided, however,
        that any of the Depositor or the Servicer may in its discretion undertake
        any
        such action that it may deem necessary or desirable in respect of this Agreement
        and the rights and duties of the parties hereto and interests of the Trustee
        and
        the Certificateholders hereunder. In such event, the legal expenses and costs
        of
        such action and any liability resulting therefrom shall be expenses, costs
        and
        liabilities of the Trust Fund, and the Depositor and the Servicer shall be
        entitled to be reimbursed therefor out of the Collection Account.

      

      
        
          
          

        

        
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      Section
        6.4 Limitation
        on Resignation of Servicer.

      

      The
        Servicer shall not resign from the obligations and duties hereby imposed
        on it
        except (a) upon appointment of a successor servicer who is a member in good
        standing of MERS and receipt by the Trustee of a letter from each Rating
        Agency
        that such a resignation and appointment will not result in a downgrading
        of the
        rating of any of the Certificates, or (b) upon determination that its duties
        hereunder are no longer permissible under applicable law. Any such determination
        under clause (b) permitting the resignation of the Servicer shall be evidenced
        by an Opinion of Counsel to such effect delivered to the Trustee. No such
        resignation shall become effective until the Trustee or a successor servicer
        shall have assumed the Servicer’s responsibilities, duties, liabilities and
        obligations hereunder.

      

      Section
        6.5 Annual
        Statement as to Compliance.

      

      Commencing
        in 2008, the Servicer shall deliver to the Depositor and the Trustee on or
        before March 15 of each applicable calendar year, (or March 24 if there is
        no
        requirement to file a Form 10-K in that calendar year), an Officer’s Certificate
        stating, as to the signer thereof, that (i) a review of the activities of
        the
        Servicer during the preceding fiscal year and of the performance of the Servicer
        under this Agreement has been made under such officer’s supervision and (ii) to
        the best of such officer’s knowledge, based on such review, the Servicer has
        fulfilled all of its material obligations under this Agreement throughout
        such
        year, or, if there has been a material default in the fulfillment of any
        such
        obligation, specifying each such default known to such officer and the nature
        and status thereof. Upon request, the Trustee shall forward a copy of each
        such
        statement to each Rating Agency and each Underwriter.

      

      Commencing
        in 2008, on or before March 15 of each calendar year (or March 24 if there
        is no
        requirement to file a Form 10-K in that calendar year), the Servicer shall
        deliver to the Depositor and the Trustee a report regarding its assessment
        of
        compliance with the servicing criteria specified in paragraph (d) of Item
        1122
        of Regulation AB (§ 229.1122(d)), as of and for the period ending the end of
        each fiscal year, with respect to asset-backed security transactions taken
        as a
        whole involving the Servicer, and that are backed by the same asset type
        as the
        Mortgage Loans. Each such report shall include all of the statements required
        under paragraph (a) of Item 1122 of Regulation AB (§ 229.1122(a)).

      

      
        
          
          

        

        
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      Copies
        of
        such statements shall be provided to any Securityholder upon request, by
        the
        Servicer or by the Trustee at the Servicer’s expense if the Servicer failed to
        provide such copies (unless (i) the Servicer shall have failed to provide
        the
        Trustee with such statement or (ii) the Trustee shall be unaware of the
        Servicer’s failure to provide such statement.

      

      The
        Servicer shall promptly notify the Depositor and the Trustee (i) of any legal
        proceedings pending against the Servicer of the type described in Item 1117
        (§
229.1117) of Regulation AB and (ii) if the Servicer shall become (but only
        to
        the extent not previously disclosed to the Trustee and the Depositor) at
        any
        time an affiliate of any of the Seller, the Trustee or any Servicer,
        Subservicer, Subcontractor or “Originator” contemplated by Item 1110 (§
229.1110) of Regulation AB, any significant obligor contemplated by Item
        1112 (§
229.1112) of Regulation AB, any enhancement or support provider contemplated
        by
        Items 1114 or 1115 (§§ 229.1114-1115) of Regulation AB or any other material
        party to the Trust contemplated by Item 1100(d)(1) (§ 229.1100(d)(1)) of
        Regulation AB.

      

      Section
        6.6 Annual
        Independent Public Accountants’ Servicing Statement.

      

      Commencing
        in 2008, on or before March 15 of each calendar year (or March 24 if there
        is no
        requirement to file a Form 10-K in that calendar year), the Servicer shall
        deliver to the Trustee and the Depositor a report by a registered public
        accounting firm that attests to, and reports on, the assessment made by the
        Servicer pursuant to the second paragraph of Section 8.5. Such report shall
        be
        made in accordance with standards for attestation engagements issued or adopted
        by the Public Company Accounting Oversight Board.

      

      ARTICLE
        7

      

      SERVICER
        DEFAULT

      

      Section
        7.1 Events
        of Default.

      

      “Event
        of
        Default,” wherever used herein, means any one of the following
        events:

      

      (i) any
        failure by the Servicer to deposit in the Collection Account or remit to
        the
        Trustee any payment required to be made under the terms of this Agreement,
        which
        failure shall continue unremedied for five days after the date upon which
        written notice of such failure shall have been given to the Servicer by the
        Trustee or the Depositor and the Trustee by the Holders of Certificates having
        not less than 51% of the Voting Rights evidenced by the Certificates;
        or

      

      (ii) any
        failure by the Servicer to observe or perform in any material respect any
        other
        of the covenants or agreements on the part of the Servicer contained in this
        Agreement, which failure materially affects the rights of Certificateholders,
        which failure continues unremedied for a period of 60 days after the date
        on
        which written notice of such failure shall have been given to the Servicer
        by
        the Trustee or the Depositor, or to the Servicer and the Trustee by the Holders
        of Certificates evidencing not less than 51% of the Voting Rights evidenced
        by
        the Certificates; provided, however, that the 60-day cure period shall not
        apply
        to the initial delivery of the Mortgage File for Delay Delivery Mortgage
        Loans
        nor the failure to substitute or repurchase in lieu thereof; or

      

      
        
          
          

        

        
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      (iii) a
        decree
        or order of a court or agency or supervisory authority having jurisdiction
        in
        the premises for the appointment of a receiver or liquidator in any insolvency,
        readjustment of debt, marshalling of assets and liabilities or similar
        proceedings, or for the winding-up or liquidation of its affairs, shall have
        been entered against the Servicer and such decree or order shall have remained
        in force undischarged or unstayed for a period of 60 consecutive days;
        or

      

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

      

      (v) the
        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.

      

      Upon
        its
        obtaining actual knowledge of the occurrence of an Event of Default, the
        Trustee
        shall promptly deliver to the Depositor, an Officer’s Certificate that an event
        has occurred that may justify termination of the Servicer hereunder and
        describing the circumstances surrounding such event. Upon the occurrence
        of an
        Event of Default, the Trustee may terminate the Servicer hereunder, if in
        its
        judgment such termination is in the best interests of the Trust Fund. The
        Trustee shall so terminate the Servicer if directed to do so by the Holders
        of
        Certificates evidencing not less than 51% of the Voting Rights evidenced
        by the
        Certificates exercised in writing following delivery to such Holders by the
        Trustee of notice of the occurrence of such Event of Default pursuant to
        Section
        7.2(b).

      

      Upon
        any
        such termination, the Trustee shall enter into a substitute servicing
        arrangement with another mortgage loan servicing company acceptable to the
        Trustee and Rating Agency under which such mortgage loan servicing company
        shall
        assume, satisfy, perform and carry out all liabilities, duties, responsibilities
        and obligations that are to be, or otherwise were to have been, satisfied,
        performed and carried out by the terminated Servicer hereunder. Until such
        time
        as the Trustee enters into a substitute servicing agreement with respect
        to the
        Mortgage Loans, the Trustee shall assume, satisfy, perform and carry out
        all
        obligations which otherwise were to have been satisfied, performed and carried
        out by the terminated Servicer. As compensation to the Trustee for any servicing
        obligations fulfilled or assumed by the Trustee, the Trustee shall be entitled
        to any servicing compensation to which the terminated Servicer would have
        been
        entitled if such Servicer had not been terminated.

      

      Notwithstanding
        any termination of the activities of the Servicer hereunder, the Servicer
        shall
        be entitled to receive, out of any late collection of a Scheduled Payment
        on a
        Mortgage Loan which was due prior to the notice terminating such Servicer’s
        rights and obligations as Servicer hereunder and received after such notice,
        that portion thereof to which such Servicer would have been entitled pursuant
        to
        Sections 3.8(a)(i) through (vii), and any other amounts payable to such Servicer
        hereunder the entitlement to which arose prior to the termination of its
        activities hereunder.

      

      
        
          
          

        

        
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      In
        no
        event shall the termination of the Servicer under this Agreement result in
        any
        diminution of the Servicer’s right to reimbursement for any outstanding Advances
        due such Servicer at the time of termination. The successor Servicer shall
        be
        obligated to promptly reimburse the terminated Servicer for outstanding Advances
        provided, however, that if the Trustee becomes the successor Servicer, such
        reimbursement obligation shall be limited to the funds available in the
        Collection Account for such purposes pursuant to Sections 3.8(a)(ii) and
        3.8(iii) of the Pooling and Servicing Agreement. In addition, any such
        reimbursement for outstanding Advances shall be made on a first in, first
        out
        (“FIFO”) basis no later than the 18th
        day
        of
        each month provided that the successor Servicer has received prior written
        notice from the appropriate party, under the Pooling and Servicing Agreement,
        of
        such reimbursement amount.

      

      Section
        7.2 Notification
        to Certificateholders.

      

      (a) Upon
        any
        termination of or appointment of a successor to the Servicer, the Trustee
        shall
        give prompt written notice thereof to Certificateholders and to each Rating
        Agency.

      

      (b) Within
        60
        days after the occurrence of any Event of Default, the Trustee shall transmit
        by
        mail to all Certificateholders notice of each such Event of Default hereunder
        known to the Trustee, unless such Event of Default shall have been cured
        or
        waived.

      

      ARTICLE
        8

      

      CONCERNING
        THE TRUSTEE

      

      Section
        8.1 Duties
        of Trustee.

      

      The
        Trustee, prior to the occurrence of an Event of Default of which a Responsible
        Officer of the Trustee has actual knowledge and after the curing of all Events
        of Default that may have occurred, shall undertake to perform such duties
        and
        only such duties as are specifically set forth in this Agreement. In case
        an
        Event of Default of which a Responsible Officer of the Trustee has actual
        knowledge has occurred and remains uncured, the Trustee shall exercise such
        of
        the rights and powers vested in it by this Agreement, and use the same degree
        of
        care and skill in their exercise as a prudent person would exercise or use
        under
        the circumstances in the conduct of such person’s own affairs.

      

      The
        Trustee, upon receipt of all resolutions, certificates, statements, opinions,
        reports, documents, orders or other instruments furnished to the Trustee
        that
        are specifically required to be furnished pursuant to any provision of this
        Agreement shall examine them to determine whether they are in the form required
        by this Agreement; provided, however, that the Trustee shall not be responsible
        for the accuracy or content of any such resolution, certificate, statement,
        opinion, report, document, order or other instrument. If any such instrument
        is
        found not to conform in any material respect to the requirements of this
        Agreement, the Trustee shall notify the Certificateholders of such instrument
        in
        the event that the Trustee, after so requesting, does not receive a
        satisfactorily corrected instrument.

      

      
        
          
          

        

        
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      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) unless
        an
        Event of Default of which a Responsible Officer of the Trustee has actual
        knowledge shall have occurred and be continuing, 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 the Trustee may conclusively rely, as to the truth of the statements
        and the correctness of the opinions expressed therein, upon any certificates
        or
        opinions furnished to the Trustee and conforming to the requirements of this
        Agreement which it believed in good faith to be genuine and to have been
        duly
        executed by the proper authorities respecting any matters arising
        hereunder;

      

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

      

      (iii) the
        Trustee shall not be liable with respect to any action taken, suffered or
        omitted to be taken by it in good faith in accordance with the direction
        of
        Holders of Certificates evidencing not less than 25% of the Voting Rights
        of
        Certificates relating 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 required to expend or risk its own funds or otherwise
        incur
        financial liability in the performance of any of its duties hereunder or
        the
        exercise of any of its rights or powers if there is reasonable ground for
        believing that the repayment of such funds or adequate indemnity against
        such
        risk or liability is not assured to it, and none of the provisions contained
        in
        this Agreement shall in any event require the Trustee to perform, or be
        responsible for the manner of performance of, any of the obligations of the
        Servicer under this Agreement except during such time, if any, as the Trustee
        shall be the successor to, and be vested with the rights, duties, powers
        and
        privileges of, the Servicer; and

      

      (v) without
        limiting the generality of this Section 8.1, the Trustee shall have no duty
        (A)
        to see to any recording, filing, or depositing of this Agreement or any
        agreement referred to herein or any financing statement or continuation
        statement evidencing a security interest, or to see to the maintenance of
        any
        such recording or filing or deposit or to any rerecording, refiling or
        redepositing of any thereof, (B) to see to any insurance, (C) to see to the
        payment or discharge of any tax, assessment, or other governmental charge
        or any
        lien or encumbrance of any kind owing with respect to, assessed or levied
        against, any part of the Trust Fund other than from funds available in the
        Distribution Account (D) to confirm or verify the contents of any reports
        or
        certificates of the Servicer delivered to the Trustee pursuant to this Agreement
        believed by the Trustee to be genuine and to have been signed or presented
        by
        the proper party or parties.

      

      
        
          
          

        

        
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      (vi) The
        Trustee shall deliver or cause to be delivered a correct, complete and duly
        executed IRS Form W-9 of the Supplemental Interest Trust to the Swap
        Counterparty no later than the first Payment Date under the Cap Agreement
        or
        Swap Agreement, and, if requested by the Swap Counterparty an applicable
        IRS
        Form W-8IMY.

      

      Section
        8.2 Certain
        Matters Affecting the Trustee.

      

      Except
        as
        otherwise provided in Section 8.1:

      

      (i) the
        Trustee may request and rely upon and shall be protected in acting or refraining
        from acting upon any resolution, Officers’ Certificate, certificate of auditors
        or any other certificate, statement, instrument, opinion, report, notice,
        request, consent, order, appraisal, bond or other paper or document believed
        by
        it to be genuine and to have been signed or presented by the proper party
        or
        parties and the Trustee shall have no responsibility to ascertain or confirm
        the
        genuineness of any signature of any such party or parties;

      

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

      

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

      

      (iv) 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 Holders of Certificates evidencing
        not
        less than 25% of the Voting Rights allocated to each Class of Certificates;
        provided, however, that if the payment within a reasonable time to the Trustee
        of the costs, expenses or liabilities likely to be incurred by it in the
        making
        of such investigation is, in the opinion of the Trustee, not assured to the
        Trustee by the security afforded to it by the terms of this Agreement, the
        Trustee may require indemnity satisfactory to the Trustee against such cost,
        expense or liability as a condition to taking any such action. 

      

      
        
          
          

        

        
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      (v) the
        Trustee may execute any of the trusts or powers hereunder or perform any
        duties
        hereunder either directly or by or through agents, accountants or attorneys
        and
        the Trustee shall not be responsible for any misconduct or negligence on
        the
        part of such agent, accountant or attorney appointed by the Trustee with
        due
        care;

      

      (vi) the
        Trustee shall not be required to risk or expend its own funds or otherwise
        incur
        any financial liability in the performance of any of its duties or in the
        exercise of any of its rights or powers hereunder if it shall have reasonable
        grounds for believing that repayment of such funds or adequate indemnity
        against
        such risk or liability is not assured to it;

      

      (vii) the
        Trustee shall not be liable for any loss on any investment of funds pursuant
        to
        this Agreement (other than as issuer of the investment security);

      

      (viii) the
        Trustee or its Affiliates shall be permitted to receive additional compensation
        that could be deemed to be in the Trustee’s economic self-interest for (i)
        serving as investment adviser, administrator, shareholder servicing agent,
        custodian or sub-custodian with respect to certain of the Eligible Investments,
        (ii) using Affiliates to effect transactions in certain Eligible Investments
        and
        (iii) effecting transactions in certain Eligible Investments.

      

      (ix) the
        Trustee shall not be deemed to have knowledge of an Event of Default until
        a
        Responsible Officer of the Trustee shall have received written notice thereof
        and in the absence of such notice, the Trustee may conclusively assume that
        there is no Event of Default;

      

      (x) the
        Trustee shall be under no obligation to exercise any of the trusts, rights
        or
        powers vested in it by this Agreement or to institute, conduct or defend
        any
        litigation hereunder or in relation hereto at the request, order or direction
        of
        any of the Certificateholders, pursuant to the provisions of this Agreement,
        unless such Certificateholders shall have offered to the Trustee reasonable
        security or indemnity satisfactory to the Trustee against the costs, expenses
        and liabilities which may be incurred therein or thereby;

      

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

      

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

      

      Section
        8.3 Trustee
        Not Liable for Certificates or Mortgage Loans.

      

      The
        recitals contained herein and in the Certificates shall be taken as the
        statements of the Depositor, the Depositor or 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, the
        Swap
        Agreement, the Cap Agreement or of the Certificates or of any Mortgage Loan
        or
        related document other than with respect to the Trustee’s execution and
        counter-signature of the Certificates. The Trustee shall not be accountable
        for
        the use or application by the Depositor or the Servicer of any funds paid
        to the
        Depositor or the Servicer in respect of the Mortgage Loans or deposited in
        or
        withdrawn from the Collection Account by the Depositor or the
        Servicer.

      

      
        
          
          

        

        
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      Section
        8.4 Trustee
        May Own Certificates.

      

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

      

      Section
        8.5 Trustee’s
        Fees and Expenses.

      

      The
        Trustee, as compensation for its activities prior to making the distributions
        pursuant to Section 4.1 hereunder, shall be entitled to deduct from the
        Distribution Account on each Distribution Date an amount equal to the Trustee
        Fee and reasonable expenses for such Distribution Date. SMS shall indemnify
        and
        hold harmless the Trustee, the Paying Agent or the Custodian and any director,
        officer, employee or agent thereof against any loss, liability or expense,
        including reasonable attorney’s fees, incurred in connection with or arising out
        of or in connection with this Agreement, the Swap Agreement, the Cap Agreement,
        any custodial agreement or the Certificates, including, but not limited to,
        any
        such loss, liability or expense incurred in connection with any legal action
        against the Trust or the Trustee, the Paying Agent or the Custodian or any
        director, officer, employee or agent thereof, or the performance of any of
        the
        duties of the Trustee or the Paying Agent under this Agreement, the Swap
        Agreement or the Cap Agreement, or the duties of the Custodian under any
        custodial agreement (including, but not limited to, the execution and delivery
        of documents in connection with a foreclosure sale, trustee’s sale, or deed in
        lieu of foreclosure of a Mortgage Loan, including, but not, limited to, any
        deed
        of reconveyance, any substitution of trustee documents or any other documents
        to
        release, satisfy, cancel or discharge any Mortgage Loan) other than any loss,
        liability or expense incurred by reason of the willful misfeasance, bad faith
        or
        negligence in the performance of the duties under this Agreement, the Swap
        Agreement or the Cap Agreement or by reason of the willful misfeasance, bad
        faith or gross negligence of the Custodian under any custodial agreement
        (including specifically any loss, liability or expense incurred by the Custodian
        by reason of simple negligence under any custodial agreement). The provisions
        of
        this Section 8.5 shall survive the resignation or removal of the Trustee
        or the
        Paying Agent and the termination of this Agreement and the resignation or
        removal of the Custodian under any custodial agreement. The Trustee may receive
        an additional indemnity from a party acceptable to the Trustee.

      

      Section
        8.6 Eligibility
        Requirements for Trustee.

      

      The
        Trustee hereunder shall at all times be a corporation or association organized
        and doing business under the laws of a state or the United States of America,
        authorized under such laws to exercise corporate trust powers, having a combined
        capital and surplus of at least $50,000,000, subject to super-vision or
        examination by federal or state authority and with a credit rating which
        would
        not cause either of the Rating Agencies to reduce their respective then current
        ratings of the Certificates (or having provided such security from time to
        time
        as is sufficient to avoid such reduction). If such corporation or 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 8.6 the combined capital and surplus of such
        corporation or association shall be deemed to be its combined capital and
        surplus as set forth in its most recent report of condition so published.
        In
        case at any time the Trustee shall cease to be eligible in accordance with
        the
        provisions of this Section 8.6, the Trustee shall resign immediately in the
        manner and with the effect specified in Section 8.7 hereof. The entity serving
        as Trustee may have normal banking and trust relationships with the Depositor
        and its affiliates or the Servicer and its affiliates; provided, however,
        that
        such entity cannot be an affiliate of the Servicer other than the Trustee
        in its
        role as successor to the Servicer.

      

      
        
          
          

        

        
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      Section
        8.7 Resignation
        and Removal of Trustee.

      

      The
        Trustee may at any time resign and be discharged from the trusts hereby created
        by giving written notice of resignation to the Depositor, the Swap Counterparty,
        the Cap Counterparty and the Servicer and each Rating Agency not less than
        60
        days before the date specified in such notice when, subject to Section 8.8,
        such
        resignation is to take effect, and acceptance by a successor trustee in
        accordance with Section 8.8 meeting the qualifications set forth in Section
        8.6.
        If no successor trustee meeting such qualifications shall have been so appointed
        and have accepted appointment within 30 days after the giving of such notice
        or
        resignation, the resigning Trustee may petition any court of competent
        jurisdiction for the appointment of a successor trustee.

      

      If
        at any
        time the Trustee shall cease to be eligible in accordance with the provisions
        of
        Section 8.6 hereof and shall fail to resign after written request thereto
        by the
        Depositor, or if at any time the Trustee shall become incapable of acting,
        or
        shall be adjudged as bankrupt or insolvent, or a receiver of the Trustee
        or of
        its property shall be appointed, or any public officer shall take charge
        or
        control of the Trustee or of its property or affairs for the purpose of
        rehabilitation, conservation or liquidation, or a tax is imposed with respect
        to
        the Trust Fund by any state in which the Trustee or the Trust Fund is located
        and the imposition of such tax would be avoided by the appointment of a
        different trustee, then the Depositor or the Servicer may remove the Trustee
        and
        appoint a successor trustee by written instrument, in triplicate, one copy
        of
        which instrument shall be delivered to the Trustee, one copy of which shall
        be
        delivered to the Servicer and one copy to the successor trustee.

      

      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
        by the
        successor Trustee to the Servicer, one complete set to the Trustee so removed
        and one complete set to the successor so appointed. Notice of any removal
        of the
        Trustee shall be given to each Rating Agency by the Successor
        Trustee.

      

      Any
        resignation or removal of the Trustee and appointment of a successor trustee
        pursuant to any of the provisions of this Section 8.7 shall become effective
        upon acceptance of appointment by the successor trustee as provided in Section
        8.8 hereof.

      

      
        
          
          

        

        
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      Section
        8.8 Successor
        Trustee.

      

      Any
        successor trustee appointed as provided in Section 8.7 hereof shall execute,
        acknowledge and deliver to the Depositor and to its predecessor trustee and
        the
        Servicer an instrument accepting such appointment hereunder and thereupon
        the
        resignation or removal of the predecessor trustee shall become effective
        and
        such successor trustee, without any further act, deed or conveyance, shall
        become fully vested with all the rights, powers, duties and obligations of
        its
        predecessor hereunder, with the like effect as if originally named as trustee
        herein. The Depositor, the Servicer and the predecessor trustee shall execute
        and deliver such instruments and do such other things as may reasonably be
        required for more fully and certainly vesting and confirming in the successor
        trustee all such rights, powers, duties, and obligations.

      

      No
        successor trustee shall accept appointment as provided in this Section 8.8
        unless at the time of such acceptance such successor trustee shall be eligible
        under the provisions of Section 8.6 hereof and its appointment shall not
        adversely affect the then current rating of the Certificates.

      

      Upon
        acceptance of appointment by a successor trustee as provided in this Section
        8.8, the Depositor shall mail notice of the succession of such trustee hereunder
        to all Holders of Certificates and the Swap Counterparty and the Cap
        Counterparty. 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
        8.9 Merger
        or Consolidation of Trustee.

      

      Any
        corporation into which the Trustee may be merged or converted or with which
        it
        may be consolidated or any corporation resulting from any merger, conversion
        or
        consolidation to which the Trustee shall be a party, or any corporation
        succeeding to the business of the Trustee, shall be the successor of the
        Trustee
        hereunder, provided that such corporation shall be eligible under the provisions
        of Section 8.6 hereof without the execution or filing of any paper or further
        act on the part of any of the parties hereto, anything herein to the contrary
        notwithstanding.

      

      Section
        8.10 Appointment
        of Co-Trustee or Separate Trustee.

      

      Notwithstanding
        any other provisions of this Agreement, at any time, for the purpose of meeting
        any legal requirements of any jurisdiction in which any part of the Trust
        Fund
        or property securing any Mortgage Note may at the time be located, the Servicer
        and the Trustee acting jointly shall have the power and shall execute and
        deliver all instruments to appoint one or more Persons approved by the Trustee
        to act as co-trustee or co-trustees jointly with the Trustee, or separate
        trustee or separate trustees, of all or any part of the Trust Fund, and to
        vest
        in such Person or Persons, in such capacity and for the benefit of the
        Certificateholders, such title to the Trust Fund or any part thereof, whichever
        is applicable, and, subject to the other provisions of this Section 8.10,
        such
        powers, duties, obligations, rights and trusts as the Servicer and the Trustee
        may consider necessary or desirable. If the Servicer shall not have joined
        in
        such appointment within 15 days after the receipt by it of a request to do
        so,
        or in the case an Event of Default shall have occurred and be continuing,
        the
        Trustee alone shall have the power to make such appointment. No co-trustee
        or
        separate trustee hereunder shall be required to meet the terms of eligibility
        as
        a successor trustee under Section 8.6 and no notice to Certificateholders
        of the
        appointment of any co-trustee or separate trustee shall be required under
        Section 8.8.

      

      
        
          
          

        

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

      

      (i) To
        the
        extent necessary to effectuate the purposes of 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 (it being understood that such separate
        trustee or co-trustee is not authorized to act separately without the Trustee
        joining in such act), except to the extent that under any law of any
        jurisdiction in which any particular act or acts are to be performed (whether
        as
        Trustee hereunder or as successor to the Servicer hereunder), the Trustee
        shall
        be incompetent or unqualified to perform such act or acts, in which event
        such
        rights, powers, duties and obligations (including the holding of title to
        the
        applicable Trust Fund or any portion thereof in any such jurisdiction) shall
        be
        exercised and performed singly by such separate trustee or co-trustee, but
        solely at the direction of the Trustee;

      

      (ii) No
        trustee hereunder shall be held personally liable by reason of any act or
        omission of any other trustee hereunder and such appointment shall not, and
        shall not be deemed to, constitute any such separate trustee or co-trustee
        as
        agent of the Trustee;

      

      (iii) The
        Trustee may at any time accept the resignation of or remove any separate
        trustee
        or co-trustee; and

      

      (iv) The
        Servicer, and not the Trustee, shall be liable for the payment of reasonable
        compensation, reimbursement and indemnification to any such separate trustee
        or
        co-trustee.

      

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

      

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

      

      
        
          
          

        

        
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      Section
        8.11 Tax
        Matters.

      

      It
        is
        intended that the assets with respect to which the REMIC elections are to
        be
        made, as set forth in Schedule III, shall constitute, and that the conduct
        of
        matters relating to such assets shall be such as to qualify such assets as
        REMICs as defined in and in accordance with the REMIC Provisions. In furtherance
        of such intention, the Servicer covenants and agrees that it shall act as
        agent
        (and the Servicer is hereby appointed to act as agent) on behalf of each
        such
        REMIC and that in such capacity it shall: (a) prepare and file, or cause
        to be
        prepared and filed, in a timely manner, a U.S. Real Estate Mortgage Investment
        Conduit Income Tax Return (Form 1066 or any successor form adopted by the
        Internal Revenue Service) and prepare and file or cause to be prepared and
        filed
        with the Internal Revenue Service and applicable state or local tax authorities
        income tax or information returns for each taxable year with respect to each
        such REMIC, containing such information and at the times and in the manner
        as
        may be required by the Code or state or local tax laws, regulations, or rules,
        and furnish or cause to be furnished to Certificateholders the schedules,
        statements or information at such times and in such manner as may be required
        thereby; (b) within thirty days of the Closing Date, furnish or cause to
        be
        furnished to the Internal Revenue Service, on Forms 8811 or as otherwise
        may be
        required by the Code, the name, title, address, and telephone number of the
        person that the Holders of the Certificates may contact for tax information
        relating thereto, together with such additional information as may be required
        by such Form, and update such information at the time or times in the manner
        required by the Code; (c) make or cause to be made REMIC elections as directed
        in Schedule III on the federal tax returns for each such REMIC’s first taxable
        year (and, if necessary, under applicable state law); (d) prepare and forward,
        or cause to be prepared and forwarded, to the Certificateholders and to the
        Internal Revenue Service and, if necessary, state tax authorities, all
        information returns and reports as and when required to be provided to them
        in
        accordance with the REMIC Provisions, including without limitation, the
        calculation of any original issue discount using the prepayment assumption
        and
        any information returns due to payments from the Excess Reserve Fund Account
        and
        the Supplemental Interest Trust; (e) provide information necessary for the
        computation of tax imposed on the transfer of a Residual Certificate to a
        Person
        that is not a Permitted Transferee, or an agent (including a broker, nominee
        or
        other middleman) of a Non-Permitted Transferee, or a pass-through entity
        in
        which a Non-Permitted Transferee is the record holder of an interest (the
        reasonable cost of computing and furnishing such information may be charged
        to
        the Person liable for such tax); (f) to the extent that they are under its
        control conduct matters relating to such assets at all times that any
        Certificates are outstanding so as to maintain the status of each REMIC created
        hereunder under the REMIC Provisions; (g) not knowingly or intentionally
        take
        any action or omit to take any action that would cause an Adverse REMIC Event;
        (h) pay the amount of any federal, state or local tax, including prohibited
        transaction taxes as described below, imposed on any such REMIC prior to
        its
        termination when and as the same shall be due and payable (but such obligation
        shall not prevent the Servicer or any other appropriate Person from contesting
        any such tax in appropriate proceedings and shall not prevent the Servicer
        from
        withholding payment of such tax, if permitted by law, pending the outcome
        of
        such proceedings); (i) ensure that federal, state or local income tax or
        information returns shall be signed by the Trustee or such other person as
        may
        be required to sign such returns by the Code or state or local laws, regulations
        or rules; (j) maintain records relating to any such REMIC, including but
        not
        limited to the income, expenses, assets and liabilities thereof and the fair
        market value and adjusted basis of the assets determined at such intervals
        as
        may be required by the Code, as may be necessary to prepare the foregoing
        returns, schedules, statements or information; and (k) as and when necessary
        and
        appropriate, represent any such REMIC in any administrative or judicial
        proceedings relating to an examination or audit by any governmental taxing
        authority, request an administrative adjustment as to any taxable year of
        any
        such REMIC, enter into settlement agreements with any governmental taxing
        agency, extend any statute of limitations relating to any tax item of any
        such
        REMIC, and otherwise act on behalf of any such REMIC in relation to any tax
        matter or controversy involving it.

      

      
        
          
          

        

        
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      To
        enable
        the Servicer to perform its duties as set forth herein, the Depositor shall
        provide, or cause to be provided, to the Servicer within ten (10) days after
        the
        Closing Date all information or data that the Servicer requests in writing
        and
        determines to be relevant for tax purposes to the valuations and offering
        prices
        of the Certificates, including, without limitation, the price, yield, prepayment
        assumption and projected cash flows of the Certificates and the Mortgage
        Loans.
        Thereafter, the Depositor shall provide to the Servicer promptly upon written
        request therefor, any such additional information or data that the Servicer
        may,
        from time to time, reasonably request in order to enable the Servicer to
        perform
        its duties as set forth herein. The Depositor hereby indemnifies the Servicer
        for any losses, liabilities, damages, claims or expenses of the Servicer
        arising
        from any errors or miscalculations of the Servicer that result from any failure
        of the Depositor to provide, or to cause to be provided, accurate information
        or
        data to the Servicer on a timely basis.

      

      The
        Depositor, the Servicer and the Trustee covenant and agree that (i) they
        shall,
        to the extent that they are under their control, conduct matters relating
        to the
        assets of the Trust Fund at all times that any Certificates are outstanding
        so
        as to maintain the status of each REMIC created hereunder under the REMIC
        Provisions (and, with respect to matters that are under its control and which
        are otherwise required to be performed by the Trustee pursuant to this
        Agreement, the Trustee shall maintain the treatment of the Excess Reserve
        Fund
        Account and the rights with respect to payments from the Excess Reserve Fund
        Account as provided in paragraph (b) below), and (ii) they shall not knowingly
        or intentionally take any action or omit to take any action that would cause
        an
        Adverse REMIC Event.

      

      Section
        8.12 Trustee
        Exchange Act Reporting Requirements.

      

      (a) On
        or
        before March 15 of each calendar year (or March 24 if there is no requirement
        to
        file a Form 10-K in that calendar year), the Trustee shall deliver to the
        Servicer and the Depositor a report regarding its assessment of compliance
        with
        the servicing criteria specified in paragraph (d) of Item 1122 of Regulation
        AB
        (§ 229.1122(d)), as of and for the period ending the end of each fiscal year,
        with respect to asset-backed security transactions taken as a whole involving
        the Trustee and that are backed by the same asset type as the Mortgage Loans.
        Each such report shall include all of the statements required to be provided
        under paragraph (a) of Item 1122 of Regulation AB (§ 229.1122(a)) as set forth
        in Exhibit T hereto.

      

      (b) On
        or
        before March 15 of each calendar year (or March 24 if there is no requirement
        to
        file a Form 10-K in that calendar year), the Trustee shall each deliver to
        the
        Servicer and the Depositor a report by a registered public accounting firm
        that
        attests to, and reports on, the assessment made by the Trustee pursuant to
        subsection (a) above. Each such report shall be made in accordance with
        standards for attestation engagements issued or adopted by the Public Company
        Accounting Oversight Board.

      

      
        
          
          

        

        
          102

          
            

          

        

        
          
          

        

      

      (c) The
        Trustee shall promptly notify the Servicer and the Depositor of any legal
        proceedings pending against the Trustee of the type described in Item 1117
        (§
229.1117) of Regulation AB.

      

      (d) In
        order
        to comply with laws, rules, regulations and executive orders in effect from
        time
        to time applicable to banking institutions, including those relating to the
        funding of terrorist activities and money laundering (“Applicable Law”), the
        Trustee is required to obtain, verify and record certain information relating
        to
        individuals and entities which maintain a business relationship with the
        Trustee. Accordingly, each of the parties agrees to provide to Trustee upon
        its
        request from time to time such identifying information and documentation
        as may
        be available for such party in order to enable the Trustee to comply with
        Applicable Law.

      

      Section
        8.13 Reports
        filed with the Securities and Exchange Commission.

      

      (a) The
        Trustee and the Servicer shall reasonably cooperate with the Depositor in
        connection with the satisfaction of the reporting requirements under the
        Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Trustee
        shall prepare on behalf of the Trust Fund any Forms 8-K, 10-D and 10-K as
        provided in Section 8.13(b). 

      

      (b) The
        Depositor shall prepare or cause to be prepared the initial current report
        on
        Form 8-K. Thereafter, within 15 days after each Distribution Date, the Trustee
        shall, in accordance with industry standards, file with the Commission via
        the
        Electronic Data Gathering and Retrieval System (EDGAR) filing requirements,
        a
        Form 10-D executed by the Depositor with (i) a copy of the Monthly Statement
        for
        such Distribution Date and (ii) such other information as is required by
        Form
        10-D, including, but not limited to, the information required by Item 1121
        (§229.1121) of Regulation AB (so long as such information is made available
        to
        the Trustee in a format compatible with EDGAR filing requirements).

      

      Any
        disclosure in addition to the monthly statement required to be included on
        the
        Form 10-D (“Additional Form 10-Disclosure”) shall be determined and prepared by
        the entity that is indicated in Exhibit S as the responsible entity for
        providing that information. Any Additional Form 10-D Disclosure shall be
        provided to the Trustee by email to DBSec.Notifications@db.com within 5 calendar
        days after the related Determination Date. Any Additional Form 10-D Disclosure
        shall clearly identify which item of Form 10-D the information relates to.
        The
        Depositor shall also be copied on any Additional Form 10-D
        Disclosure.

      

      The
        Trustee shall compile the information provided to it, prepare the Form 10-D
        and
        forward the Form 10-D to the Depositor for review and verification. No later
        than three Business Days prior to the 15th calendar day after the related
        Distribution Date, an officer of the Depositor shall sign the Form 10-D and
        return such executed Form 10-D to the Trustee by email (with an original
        executed hard copy to follow by overnight mail).

      

      
        
          
          

        

        
          103

          
            

          

        

        
          
          

        

      

      Prior
        to
        January 30 of the first year in which the Trustee is able to do so under
        applicable law, the Trustee shall file a Form 15 Suspension Notice with respect
        to the Trust Fund, if applicable. Prior to (x) March 31, 2008 and (y) unless
        and
        until a Form 15 Suspension Notice shall have been filed, prior to March 31
        of
        each year thereafter, the Trustee shall prepare a Form 10-K with respect
        to the
        Trust Fund. The Trustee shall file each such Form 10-K by March 31 of the
        applicable year. Such Form 10-K shall be signed by an appropriate officer
        of the
        Depositor by March 25, 2008 and shall include the certification required
        pursuant to the Sarbanes-Oxley Act of 2002, as amended from time to time,
        and
        any rules promulgated thereunder by the Commission (the “Form 10-K
        Certification”), which certification shall be signed by an appropriate officer
        of the Depositor. Such Form 10-K shall also include as exhibits (i) the annual
        statement as to compliance and the assessments of compliance with servicing
        criteria described in Section 3.16 and Section 6.5 of this Agreement, (ii)
        the
        public accounting firm attestation reports described in Section 3.17 and
        Section
        6.6 of this Agreement, relating to the assessments of compliance with servicing
        criteria described therein and (iii) the items described in (i) and (ii)
        above
        with respect to any Subservicer or Subcontractor. If any party’s report on
        assessment of compliance with servicing criteria required by clause (i) in
        the
        immediately preceding sentence, or the related public accounting firm
        attestation report required by clause (ii) in the immediately preceding
        sentence, identifies any material instance of noncompliance with the servicing
        criteria specified in paragraph (d) of Item 1122 of Regulation AB
        (§229.1122(d)), the Form 10-K shall identify the material instance of
        noncompliance. If these items have not been delivered to the Trustee within
        a
        reasonable period of time before the Trustee files any Form 10-K, the Trustee
        shall cooperate with the Depositor to file an amended Form 10-K including
        such
        missing documents as exhibits reasonably promptly after receipt of such items
        by
        the Trustee. 

      

      Prior
        to
        (x) March 1, 2008 and (y) unless an until a Form 15 Suspension Notice shall
        have
        been filed, prior to March 1 of each year thereafter, each entity that is
        indicated in Exhibit S as a responsible entity for providing any disclosure
        or
        information in addition that described in the preceding paragraph that is
        required to be included on Form 10-K (“Additional Form 10-K Disclosure”) shall
        be required to provide to the Trustee by email to DBSec.Notifications@db.com.
        Any Additional Form 10-K Disclosure shall clearly identify which item of
        Form
        10-K the information relates to. The Depositor shall also be copied on any
        Additional Form 10-K Disclosure.

      

      (c) The
        Trustee shall sign a certification (in the form attached hereto as Exhibit
        O)
        for the benefit of the Depositor and its officers, directors and affiliates
        (provided, however, that the Trustee shall not undertake an analysis of the
        accountant’s report referred to in Section 3.17 and Section 6.5 of this
        Agreement), and the Servicer shall sign a certification in the form attached
        hereto as Exhibit P for the benefit of the Depositor, the Trust Fund, the
        Trustee and their officers, directors and affiliates.

      

      In
        addition, (i) the Trustee shall indemnify and hold harmless the Depositor
        and
        its officers, and directors from and against losses, damages (except for
        special, indirect or consequential loss or damage) penalties, fines,
        forfeitures, reasonable and necessary legal fees and related costs, judgments
        and other costs and expenses arising out of or based upon an intentional
        breach
        by the Trustee of its obligations under this Section or the Trustee’s
        negligence, bad faith or willful misconduct in connection therewith, (ii)
        the
        Servicer shall indemnify and hold harmless the Depositor, the Trustee and
        each
        of their respective officers, directors and affiliates from and against any
        losses, damages, penalties, fines, forfeitures, reasonable and necessary
        legal
        fees and related costs, judgments and other costs and expenses arising out
        of or
        based upon a breach of the Servicer’s obligations under this Section or the
        Servicer’s negligence, bad faith or willful misconduct in connection therewith
        and (iii) the Depositor shall indemnify and hold harmless the Trustee and
        its
        officers, directors and affiliates from and against any losses, damages,
        penalties, fines, forfeitures, reasonable and necessary legal fees and related
        costs, judgments and other costs and expenses arising out of or based upon
        a
        breach of the Depositor’s obligations under this Section or the Depositor’s
        negligence, bad faith or willful misconduct in connection
        therewith.

      

      
        
          
          

        

        
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      (d) Within
        four (4) Business Days after the occurrence of an event requiring disclosure
        on
        Form 8-K (each such event, a “Reportable Event”), the Trustee shall prepare and
        file on behalf of the Trust Fund any Form 8-K, as required by the Exchange
        Act,
        provided that the Depositor shall file the initial Form 8-K in connection
        with
        the issuance of the Certificates. Any disclosure or information related to
        a
        Reportable Event or that is otherwise required to be included on Form 8-K
        (“Form
        8-K Disclosure Information”) shall be prepared by the party responsible for
        preparing such disclosure as set forth on Exhibit S hereto and compiled by
        the
        Trustee pursuant to the following paragraph. Any Form 8-K Disclosure shall
        be
        forwarded to the Trustee by email to DBSec.Notifications@db.com. The Depositor
        shall be copied on any Form 8-K Disclosure. The Trustee will have no duty
        or
        liability for any failure hereunder to determine or prepare any Form 8-K
        Disclosure Information or any Form 8-K, except as set forth in the next
        paragraph.

      

      As
        set
        forth on Exhibit S hereto, for so long as the Issuing Entity is subject to
        the
        Exchange Act reporting requirements, no later than noon (Eastern Standard
        Time)
        on the 2nd Business Day after the occurrence of a Reportable Event, certain
        parties to this Agreement shall be required to provide to the Depositor and
        the
        Trustee, to the extent known by such applicable parties, any Form 8-K Disclosure
        Information, if applicable. The Trustee shall compile all such information
        provided to it in a Form 8-K prepared by it.

      

      After
        preparing the Form 8-K, the Trustee shall forward electronically a draft
        copy of
        the Form 8-K to the Depositor for review, verification and execution by the
        Depositor. No later than the end of the 3rd Business Day after the Reportable
        Event, an officer of the Depositor shall sign the Form 8-K and return an
        electronic or fax copy of such signed Form 8-K (with an original executed
        hard
        copy to follow by overnight mail) to the Trustee. If a Form 8-K cannot be
        filed
        on time or if a previously filed Form 8-K needs to be amended, the Trustee
        will
        cooperate with the Depositor to file an amendment.

      

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

      

      (f) The
        Trustee will have no duty to verify the accuracy or sufficiency of any
        information not prepared by it included in any Form 10-D, Form 10-K or Form
        8-K.
        The Trustee shall have no liability with respect to any failure to properly
        prepare or file any Form 10-D or Form 10-K resulting from or relating to
        the
        Trustee’s inability or failure to obtain any information or signature in a
        timely manner from the party responsible for delivery of such information
        or
        signature, so long as any such failure does not result from the negligence
        or
        willful misconduct of the Trustee. The Trustee shall have no liability with
        respect to any failure to properly file any Form 10-D, Form 10-K or Form
        8-K
        resulting from or relating to the Depositor’s failure to timely comply with the
        provisions of this section. Nothing herein shall be construed to require
        the
        Trustee or any officer, director or Affiliate thereof to sign any Form 10-D,
        Form 10-K or Form 8-K.

      

      
        
          
          

        

        
          105

          
            

          

        

        
          
          

        

      

      ARTICLE
        9

      

      TERMINATION

      

      Section
        9.1 Termination
        upon Liquidation or Purchase of all Mortgage Loans.

      

      (a) Subject
        to Section 9.3, the obligations and responsibilities of the Depositor, the
        Servicer and the Trustee created hereby with respect to the Trust Fund shall
        terminate upon the earlier of: 

      

      (i) the
        purchase by the Servicer or its designee of all Mortgage Loans (including
        REO
        Properties not otherwise disposed of pursuant to Section 3.11(i)) remaining
        in
        the Trust Fund at a price equal to the sum of (A) 100% of the Stated Principal
        Balance of each Mortgage Loan that is not a Nonrecoverable Mortgage Loan;
        (B)
        the Projected Net Liquidation Value of each Nonrecoverable Mortgage Loan
        (not
        including any REO), (C) the lesser of (x) the appraised value of any REO
        Property as determined by a real estate broker meeting the qualifications,
        and
        applying broker’s price opinion methodology, generally acceptable to residential
        mortgage servicers, or other property valuation opinion methodology customarily
        used by residential mortgage servicers with respect to defaulted loans and
        (y)
        the Stated Principal Balance of each Mortgage Loan related to any REO Property
        and (D) any remaining Swap Termination Payments payable to the Swap
        Counterparty. In addition, such purchase price shall include with respect
        to the
        Mortgage Loans (including REO Properties) accrued and unpaid interest thereon
        at
        the applicable Net Rate, except to the extent the Servicer was not or would
        not
        be required to make a P&I Advance hereunder; and 

      

      (ii) the
        later
        of (A) the maturity or other liquidation (or any Advance with respect thereto)
        of the last Mortgage Loan remaining in the Trust Fund and the disposition
        of all
        REO Property and (B) the distribution to Certificateholders of all amounts
        required to be distributed to them pursuant to this Agreement. In no event
        shall
        the trusts created hereby continue beyond the earlier of (i) the expiration
        of
        21 years from the death of the survivor of the descendants of Joseph P. Kennedy,
        the late Ambassador of the United States to the Court of St. James’s, living on
        the date hereof, and (ii) the Latest Possible Maturity Date. 

      

      The
        right
        to purchase all Mortgage Loans and REO Properties pursuant to clause (i)
        above
        shall be conditioned upon the aggregate Stated Principal Balance of the Mortgage
        Loans, at the time of any such repurchase, aggregating less than ten percent
        of
        the Stated Principal Balance of the Mortgage Loans as of the Cut-Off
        Date.

      

      
        
          
          

        

        
          106

          
            

          

        

        
          
          

        

      

      (b) With
        respect to any purchase pursuant to subsection (a), upon deposit of the price
        determined pursuant to subsection (a)(i) in the Distribution Account, the
        Trustee shall release or cause to be released to the purchaser of each such
        Mortgage Loan the related Mortgage File and shall execute and deliver such
        instruments of transfer or assignment prepared by the purchaser of such Mortgage
        Loan (including appropriate instruments with respect to any REO Property),
        in
        each case without recourse, as shall be necessary to vest in the purchaser
        of
        such Mortgage Loan any Mortgage Loan sold pursuant hereto, and the purchaser
        of
        such Mortgage Loan shall succeed to all the Trustee’s right, title and interest
        in and to such Mortgage Loan and all security and documents related thereto.
        Such assignment shall be an assignment outright and not for security. The
        purchaser of such Mortgage Loan shall thereupon own such Mortgage Loan, and
        all
        security and documents, free of any further obligation to the Trustee or
        the
        Certificateholders with respect thereto.

      

      (c) Notwithstanding
        anything to the contrary contained herein, the Servicer hereby agrees that
        it
        shall not exercise its right to purchase the Mortgage Loans in accordance
        with
        paragraph (a) of this Section 9.1 for so long as any NIM securities are
        outstanding. For purposes of this paragraph (c), “NIM securities” shall mean any
        securities issued by a trust into which the Class C Certificates are
        transferred.

      

      Section
        9.2 Final
        Distribution on the Certificates.

      

      If
        on any
        Determination Date, the Servicer determines that there are no Outstanding
        Mortgage Loans and no other funds or assets in the Trust Fund other than
        the
        funds in the Collection Account, the Servicer shall direct the Trustee promptly
        to send a final distribution notice to each Certificateholder. If the Servicer
        elects to terminate the Trust Fund pursuant to clause (a) of Section 9.1,
        at
        least 20 days prior to the date notice is to be mailed to the affected
        Certificateholders, the Servicer shall notify the Depositor, the Swap
        Counterparty, the Cap Counterparty and the Trustee of the date the Servicer
        intends to terminate the Trust Fund and of the applicable repurchase price
        of
        the Mortgage Loans and REO Properties.

      

      Notice
        of
        any termination of the Trust Fund, specifying the Distribution Date on which
        Certificateholders may surrender their Certificates for payment of the final
        distribution and cancellation, shall be given promptly by the Trustee by
        letter
        to Certificateholders mailed not earlier than the 10th day and no later than
        the
        15th day of the month next preceding the month of such final distribution.
        Any
        such notice shall specify (a) the Distribution Date upon which final
        distribution on the Certificates will be made upon presentation and surrender
        of
        Certificates at the office therein designated, (b) the amount of such final
        distribution, (c) the location of the office or agency at which such
        presentation and surrender must be made, and (d) that the Record Date otherwise
        applicable to such Distribution Date is not applicable, distributions being
        made
        only upon presentation and surrender of the Certificates at the office therein
        specified. The Servicer will give such notice to each Rating Agency at the
        time
        such notice is given to Certificateholders.

      

      In
        the
        event such notice is given, the Servicer shall cause all funds in the Collection
        Account to be remitted to the Trustee for deposit in the Distribution Account
        on
        the Business Day prior to the applicable Distribution Date in an amount equal
        to
        the final distribution in respect of the Certificates. Upon such final deposit
        with respect to the Trust Fund and the receipt by the Trustee of a Request
        for
        Release therefor, the Trustee shall promptly release to the Servicer the
        Mortgage Files for the Mortgage Loans.

      

      
        
          
          

        

        
          107

          
            

          

        

        
          
          

        

      

      Upon
        presentation and surrender of the Certificates, the Trustee shall cause to
        be
        distributed to the Certificateholders of each Class, in the order set forth
        in
        Section 4.2 hereof, on the final Distribution Date, in the case of the
        Certificateholders, in proportion to their respective Percentage Interests,
        with
        respect to Certificateholders of the same Class, an amount equal to (i) as
        to
        each Class of Regular Certificates, the Class Principal Balance thereof plus
        accrued interest thereon (or on their Notional Principal Balance, if applicable)
        in the case of an interest bearing Certificate, and (ii) as to the Residual
        Certificates, the amount, if any, which remains on deposit in the Distribution
        Account (other than the amounts retained to meet claims) after application
        pursuant to clause (i) above.

      

      In
        the
        event that any affected Certificateholders shall not surrender Certificates
        for
        cancellation within six months after the date specified in the above mentioned
        written notice, the Trustee shall give a second written notice to the remaining
        Certificateholders to surrender their Certificates for cancellation and receive
        the final distribution with respect thereto. If within six months after the
        second notice all the applicable Certificates shall not have been surrendered
        for cancellation, the Trustee may take appropriate steps, or may appoint
        an
        agent to take appropriate steps, to contact the remaining Certificateholders
        concerning surrender of their Certificates, and the cost thereof shall be
        paid
        out of the funds and other assets which remain a part of the Trust Fund.
        If
        within one year after the second notice all Certificates shall not have been
        surrendered for cancellation, the holder of each of the Class R Certificates
        shall be entitled to all unclaimed funds and other assets of the REMICs held
        for
        distribution to such Certificateholders, which remain subject
        hereto.

      

      Section
        9.3 Additional
        Termination Requirements.

      

      (a) In
        the
        event the Servicer exercises its purchase option as provided in Section 9.1,
        the
        Trust Fund shall be terminated in accordance with the following additional
        requirements, unless the Trustee has been supplied with an Opinion of Counsel,
        at the expense of the Servicer, to the effect that the failure to comply
        with
        the requirements of this Section 9.3 will not result in an Adverse REMIC
        Event:

      

      (i) The
        Trustee shall sell all of the assets that constitute the Trust Fund for cash
        as
        provided in Section 9.01(a)(i), and, within 90 days of such sale, shall
        distribute to (or credit to the account of) the Holders of the Certificates
        the
        proceeds of such sale together with other cash on hand (less amounts retained
        to
        meet claims) in complete liquidation of the Trust Fund and each REMIC created
        hereunder; 

      

      (ii) The
        Trustee shall attach a statement to the final federal income tax return for
        each
        REMIC created hereunder stating that pursuant to Treasury Regulation § 1.860F-1,
        the first day of the 90-day liquidation period for each such REMIC was the
        date
        on which the Trustee sold the assets of the Trust Fund pursuant to Section
        9.01(a)(i); and

      

      
        
          
          

        

        
          108

          
            

          

        

        
          
          

        

      

      (iii) If
        the
        Swap Agreement is still outstanding at the time of termination of the Trust
        Fund, the Trustee shall notify the Swap Counterparty of such
        termination.

      

      (b) By
        their
        acceptance of the Certificates, the Holders thereof hereby authorize the
        Trustee
        to undertake the above-described actions.

      

      ARTICLE
        10

      

      [RESERVED]

      

      ARTICLE
        11

      

      MISCELLANEOUS
        PROVISIONS

      

      Section
        11.1 Amendment.

      

      This
        Agreement may be amended from time to time by the Depositor, Servicer and
        the
        Trustee without the consent of any of the Certificateholders (i) to cure
        any
        ambiguity or mistake, (ii) to cause the provisions herein to conform to or
        be
        consistent with or in furtherance of the statements made with respect to
        the
        Certificates, the Trust Fund or this Agreement in any disclosure document
        pursuant to which any Certificates were offered; to correct any defective
        provision herein or to supplement any provision herein which may be inconsistent
        with any other provision herein, (iii) to add to the duties of the Depositor
        or
        the Servicer, (iv) to add any other provisions with respect to matters or
        questions arising hereunder or (v) to modify, alter, amend, add to or rescind
        any of the terms or provisions contained in this Agreement; provided that
        any
        action pursuant to clauses (iv) or (v) above shall not, as evidenced by an
        Opinion of Counsel delivered to the Trustee (which Opinion of Counsel shall
        not
        be an expense of the Trustee or the Trust Fund), adversely affect in any
        material respect the interests of any Certificateholder; provided, however,
        that
        the amendment shall not be deemed to adversely affect in any material respect
        the interests of the Certificateholders if the Person requesting the amendment
        obtains a letter from each Rating Agency stating that the amendment would
        not
        result in the downgrading or withdrawal of the respective ratings then assigned
        to the Certificates; it being understood and agreed that any such letter
        in and
        of itself will not represent a determination as to the materiality of any
        such
        amendment and will represent a determination only as to the credit issues
        affecting any such rating. The Trustee, the Depositor and the Servicer also
        may
        at any time and from time to time amend this Agreement without the consent
        of
        the Certificateholders to modify, eliminate or add to any of its provisions
        to
        such extent as shall be necessary or helpful to (i) maintain the qualification
        of each REMIC created hereunder as a REMIC under the Code, (ii) avoid or
        minimize the risk of the imposition of any tax on any such REMIC pursuant
        to the
        Code that would be a claim at any time prior to the final redemption of the
        Certificates or (iii) comply with any other requirements of the Code, provided
        that the Trustee have been provided an Opinion of Counsel, which opinion
        shall
        be an expense of the party requesting such opinion but in any case shall
        not be
        an expense of the Trustee or the Trust Fund, to the effect that such action
        is
        necessary or helpful to, as applicable, (i) maintain such qualification,
        (ii)
        avoid or minimize the risk of the imposition of such a tax or (iii) comply
        with
        any such requirements of the Code.

      

      
        
          
          

        

        
          109

          
            

          

        

        
          
          

        

      

      This
        Agreement may also be amended from time to time by the Depositor, Servicer
        and
        the Trustee with the consent of the Holders of a Majority in Interest of
        each
        Class of Certificates affected thereby for the purpose of adding any provisions
        to or changing in any manner or eliminating any of the provisions of this
        Agreement or of modifying in any manner the rights of the Holders of
        Certificates; provided, however, that no such amendment shall (i) reduce
        in any
        manner the amount of, or delay the timing of, payments required to be
        distributed on any Certificate without the consent of the Holder of such
        Certificate, (ii) adversely affect in any material respect the interests
        of the
        Holders of any Class of Certificates in a manner other than as described
        in (i),
        without the consent of the Holders of Certificates of such Class evidencing,
        as
        to such Class, Percentage Interests aggregating 66%, or (iii) reduce the
        aforesaid percentages of Certificates the Holders of which are required to
        consent to any such amendment, without the consent of the Holders of all
        such
        Certificates then outstanding and without the consent of the Swap Counterparty,
        but only to the extent that the Swap Counterparty is adversely affected by
        such
        amendment.

      

      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, which opinion shall not be an expense of the Trustee or the Trust
        Fund,
        to the effect that such amendment will not cause an Adverse REMIC
        Event.

      

      The
        Trustee shall provide the Swap Counterparty with at least ten (10) days prior
        written notice of any proposed amendment of this Agreement. Notwithstanding
        any
        contrary provision of this Agreement, the Trustee shall not, without the
        prior
        written consent of the Swap Counterparty, consent to any amendment to this
        Agreement that would (i) adversely affect its ability to perform, timely
        and
        fully, its obligations under the Swap Agreement, (ii) adversely affect or
        change
        the rights of the Swap Counterparty or the benefits accorded to it under
        this
        Agreement or the Swap Agreement, (iii) adversely affect or change the
        obligations of the Swap Counterparty under the Swap Agreement or (iv) modify
        the
        meaning of any term used in the Swap Agreement and defined in this Agreement,
        or
        any component thereof.

      

      Promptly
        after the execution of any amendment to this Agreement requiring the consent
        of
        Certificateholders, the Trustee shall furnish written notification of the
        substance or a copy of such amendment to each Certificateholder, Swap
        Counterparty and each Rating Agency.

      

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

      

      Nothing
        in this Agreement shall require the Trustee to enter into an amendment without
        receiving an Opinion of Counsel (which Opinion shall not be an expense of
        the
        Trustee or the Trust Fund), satisfactory to the Trustee that (i) such amendment
        is permitted and is not prohibited by this Agreement and that all requirements
        for amending this Agreement have been complied with; and (ii) either (A)
        the
        amendment does not adversely affect in any material respect the interests
        of any
        Certificateholder or the Swap Counterparty or (B) the conclusion set forth
        in
        the immediately preceding clause (A) is not required to be reached pursuant
        to
        this Section 11.1.

      

      
        
          
          

        

        
          110

          
            

          

        

        
          
          

        

      

      Section
        11.2 Recordation
        of Agreement; Counterparts.

      

      This
        Agreement is subject to recordation in all appropriate public offices for
        real
        property records in all the counties or other comparable jurisdictions in
        which
        any or all of the properties subject to the Mortgages are situated, and in
        any
        other appropriate public recording office or elsewhere, such recordation
        to be
        effected by the Servicer at its expense, but only upon direction a majority
        of
        the Certificateholders to the effect that such recordation materially and
        beneficially affects the interests of the Certificateholders. However, the
        foregoing sentence notwithstanding, the Servicer may provide copies hereof
        to
        counsel, judicial officers, and government agencies, or may cause this Agreement
        to be recorded, in any jurisdiction in which, in the Servicer’s judgment, such
        disclosure or recording may facilitate foreclosure or other recovery with
        respect to any one or more of the Mortgage Loans. 

      

      For
        the
        purpose of facilitating the recordation of this Agreement as herein provided
        and
        for other purposes, this Agreement may be executed (by facsimile or otherwise)
        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
        11.3 Governing
        Law.

      

      THIS
        AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE SUBSTANTIVE
        LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED
        IN THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
        PARTIES
        HERETO AND THE CERTIFICATEHOLDERS SHALL BE DETERMINED IN ACCORDANCE WITH
        SUCH
        LAWS.

      

      Section
        11.4 Intention
        of Parties.

      

      It
        is the
        express intent of the parties hereto that the conveyance of the Trust Fund
        by
        the Depositor to the Trustee be, and be construed as, absolute sales thereof
        to
        the Trustee. It is, further, not the intention of the parties that such
        conveyances be deemed a pledge thereof by the Depositor to the Trustee. However,
        in the event that, notwithstanding the intent of the parties, such assets
        are
        held to be the property of the Depositor, or if for any other reason this
        Agreement is held or deemed to create a security interest in such assets,
        then
        (i) this Agreement shall be deemed to be a security agreement within the
        meaning
        of the Uniform Commercial Code of the State of New York and (ii) the conveyance
        provided for in this Agreement shall be deemed to be an assignment and a
        grant
        by the Depositor to the Trustee, for the benefit of the Certificateholders,
        of a
        security interest in all of the assets that constitute the Trust Fund, whether
        now owned or hereafter acquired.

      

      The
        Depositor, for the benefit of the Certificateholders, shall, to the extent
        consistent with this Agreement, take such actions as may be necessary to
        ensure
        that, if this Agreement were deemed to create a security interest in the
        Trust
        Fund, such security interest would be deemed to be a perfected security interest
        of first priority under applicable law and will be maintained as such throughout
        the term of the Agreement. The Depositor shall arrange for filing any Uniform
        Commercial Code continuation statements in connection with any security interest
        granted or assigned to the Trustee for the benefit of the
        Certificateholders.

      

      
        
          
          

        

        
          111

          
            

          

        

        
          
          

        

      

      Section
        11.5 Notices.

      

      (a) The
        Trustee shall use its best efforts to promptly provide notice to each Rating
        Agency and Swap Counterparty and Cap Counterparty with respect to each of
        the
        following of which it has actual knowledge:

      

      1. any
        material change or amendment to this Agreement;

      

      2. the
        occurrence of any Event of Default that has not been cured;

      

      
        	 	
                3.

              	
                the
                  resignation or termination of the Servicer or the Trustee and the
                  appointment of any successor;

              

      

      

      
        	 	
                4.

              	
                the
                  repurchase or substitution of Mortgage Loans pursuant to Section
                  2.3
                  hereof;

              

      

      

      5. the
        final
        payment to Certificateholders; and

      

      6. any
        rating action involving the long-term credit rating of the Servicer, which
        notice shall be made by first-class mail within two Business Days after the
        Trustee gains actual knowledge thereof.

      

      In
        addition, the Trustee shall promptly furnish to each Rating Agency copies
        of the
        following:

      

      1. Each
        report to Certificateholders described in Section 4.5 hereof;

      

      2. Each
        annual statement as to compliance described in Section 3.16 hereof;

      

      
        	 	
                3.
                  

              	
                Each
                  annual independent public accountants’ servicing report described in
                  Section 3.17 hereof; and

              

      

      

      
        	 	
                4.

              	
                Any
                  notice of a purchase of a Mortgage Loan pursuant to Section 2.2,
                  2.3 or
                  3.11 hereof.

              

      

      

      
        	 	
                (b)

              	
                All
                  directions, demands, authorizations, consents, waivers, communications
                  and
                  notices hereunder shall be in writing and shall be deemed to have
                  been
                  duly given when delivered by first class mail, facsimile or courier
                  to the
                  applicable Notice Address, or in the case of the Rating Agencies,
                  the
                  address specified therefor in the definition corresponding to the
                  name of
                  such Rating Agency. Notices to Certificateholders shall be deemed
                  given
                  when mailed, first class postage prepaid, to their respective addresses
                  appearing in the Certificate
                  Register.

              

      

      

      
        
          
          

        

        
          112

          
            

          

        

        
          
          

        

      

      Section
        11.6 Severability
        of Provisions.

      

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

      

      Section
        11.7 Assignment.

      

      Notwithstanding
        anything to the contrary contained herein, except as provided in Section
        6.02,
        this Agreement may not be assigned by the Servicer without the prior written
        consent of the Trustee and Depositor. As a condition to the utilization of
        any
        Subservicer or Subcontractor determined to be “participating in the servicing
        function” within the meaning of Item 1122, the Servicer shall obtain from any
        such Subservicer or Subcontractor used by the Servicer for the benefit of
        the
        Depositor a written agreement from such Subservicer or Subcontractor (in
        form
        and substance satisfactory to the Depositor) to comply with the provisions
        of
        Sections 6.5 and 6.6 of this Agreement to the same extent as if such Subservicer
        or Subcontractor were the Servicer.

      

      Section
        11.8 Limitation
        on Rights of Certificateholders.

      

      The
        death
        or incapacity of any Certificateholder shall not operate to terminate this
        Agreement or the trust created hereby, nor entitle such Certificateholder’s
        legal representative or heirs to claim an accounting or to take any action
        or
        commence any proceeding in any court for a petition or winding up of the
        trust
        created hereby, or otherwise affect the rights, obligations and liabilities
        of
        the parties hereto or any of them.

      

      No
        Certificateholder shall have any right to vote (except as provided herein)
        or in
        any manner otherwise control the operation and management of the Trust Fund,
        or
        the obligations of the parties hereto, nor shall anything herein set forth
        or
        contained in the terms of the Certificates be construed so as to constitute
        the
        Certificateholders from time to time as partners or members of an association;
        nor shall any Certificateholder be under any liability to any third party
        by
        reason of any action taken by the parties to this Agreement pursuant to any
        provision hereof.

      

      No
        Certificateholder shall have any right by virtue or by availing itself of
        any
        provisions of this Agreement to institute any suit, action or proceeding
        in
        equity or at law upon or under or with respect to this Agreement, unless
        such
        Holder previously shall have given to the Trustee a written notice of an
        Event
        of Default and of the continuance thereof, as herein provided, and unless
        the
        Holders of Certificates evidencing not less than 25% of the Voting Rights
        evidenced by the Certificates shall also have made written request to the
        Trustee to institute such action, suit or proceeding in its own name as Trustee
        hereunder and shall have offered to the Trustee such reasonable indemnity
        as it
        may require against the costs, expenses, and liabilities to be incurred therein
        or thereby, and the Trustee, for 60 days after its receipt of such notice,
        request and offer of indemnity shall have neglected or refused to institute
        any
        such action, suit or proceeding; it being understood and intended, and being
        expressly covenanted by each Certificateholder with every other
        Certificateholder and the Trustee, that no one or more Holders of Certificates
        shall have any right in any manner whatever by virtue or by availing itself
        or
        themselves of any provisions of this Agreement to affect, disturb or prejudice
        the rights of the Holders of any other of the Certificates, or to obtain
        or seek
        to obtain priority over or preference to any other such Holder or to enforce
        any
        right under this Agreement, except in the manner herein provided and for
        the
        common benefit of all Certificateholders. For the protection and enforcement
        of
        the provisions of this Section 11.8, each and every Certificateholder and
        the
        Trustee shall be entitled to such relief as can be given either at law or
        in
        equity.

      

      
        
          
          

        

        
          113

          
            

          

        

        
          
          

        

      

      Section
        11.9 Inspection
        and Audit Rights.

      

      The
        Servicer agrees that, on reasonable prior notice, it will permit and will
        cause
        each Subservicer to permit any representative of the Depositor or the Trustee
        during the Servicer’s normal business hours, to examine all the books of
        account, records, reports and other papers of the Servicer relating to the
        Mortgage Loans, to make copies and extracts therefrom, to cause such books
        to be
        audited by independent certified public accountants selected by the Depositor
        or
        the Trustee and to discuss its affairs, finances and accounts relating to
        the
        Mortgage Loans with its officers, employees and independent public accountants
        (and by this provision the Servicer hereby authorizes said accountants to
        discuss with such representative such affairs, finances and accounts), all
        at
        such reasonable times and as often as may be reasonably requested. Any
        out-of-pocket expense incident to the exercise by the Depositor or the Trustee
        of any right under this Section 11.9 shall be borne by the party requesting
        such
        inspection; all other such expenses shall be borne by the Servicer or the
        related Subservicer.

      

      Section
        11.10 Certificates
        Nonassessable and Fully Paid.

      

      It
        is the
        intention of the Depositor that Certificateholders shall not be personally
        liable for obligations of the Trust Fund, that the interests in the Trust
        Fund
        represented by the Certificates shall be nonassessable for any reason
        whatsoever, and that the Certificates, upon due authentication thereof by
        the
        Trustee pursuant to this Agreement, are and shall be deemed fully
        paid.

      

      Section
        11.11 Limitations
        on Actions; No Proceedings.

      

      (a) Other
        than pursuant to this Agreement, or in connection with or incidental to the
        provisions or purposes of this Agreement, the trust created hereunder shall
        not
        (i) issue debt or otherwise borrow money, (ii) merge or consolidate with
        any
        other entity reorganize, liquidate or transfer all or substantially all of
        its
        assets to any other entity, or (iii) otherwise engage in any activity or
        exercise any power not provided for in this Agreement.

      

      (b) Notwithstanding
        any prior termination of this Agreement, the Trustee, the Servicer, the
        Depositor and the Swap Counterparty as a third-party beneficiary shall not,
        prior to the date which is one year and one day after the termination of
        this
        Agreement, acquiesce, petition or otherwise invoke or cause any Person to
        invoke
        the process of any court or government authority for the purpose of commencing
        or sustaining a case against the Depositor or the Trust Fund under any federal
        or state bankruptcy, insolvency or other similar law or appointing a receiver,
        liquidator, assignee, trustee, custodian, sequestrator or other similar official
        of the Depositor or the Trust Fund or any substantial part of their respective
        property, or ordering the winding up or liquidation of the affairs of the
        Depositor or the Trust Fund.

      

      
        
          
          

        

        
          114

          
            

          

        

        
          
          

        

      

      Section
        11.12 Mortgage
        Data.

      

      The
        Depositor hereby represents to S&P that, to the Depositor’s knowledge, the
        information provided to such Rating Agency, including any loan level detail,
        is
        true and correct according to such Rating Agency’s requirements.

      

      Section
        11.13 Third
        Party Beneficiary

      

      The
        Swap
        Counterparty shall be deemed a third-party beneficiary of this Agreement
        to the
        same extent as if it were a party hereto and shall have the right to enforce
        the
        obligations of the Trustee regarding the Supplemental Interest Trust, the
        Swap
        Agreement or otherwise relating to the Swap Counterparty. For the protection
        and
        enforcement of the provisions of this Section, the Swap Counterparty shall
        be
        entitled to relief as can be given either at law or in equity subject to
        the
        restrictions set forth in this Agreement.

      

      Section
        11.14 Replacement
        of Swap Counterparty

      

      Notwithstanding
        anything to the contrary contained herein, in the event that a replacement
        swap
        agreement is not obtained within 30 days after receipt by the Trustee of
        the
        Swap Termination Payment paid by the terminated Swap Counterparty, the Trustee
        shall deposit such Swap Termination Payment into the Supplemental Interest
        Account and the Trustee shall, on each Distribution Date, withdraw from such
        Supplemental Interest Account, an amount equal to the Net Swap Payment, if
        any,
        that would have been paid to the Supplemental Interest

      

      Trust
        by
        the original Swap Counterparty (computed in accordance with the terms of
        the
        original Swap Agreement) and distribute such amount in accordance with Section
        4.10(b) of this Agreement. 

      

      *
        *
        *

      

      

       

      
        
          
          

        

        
          115

          
            

          

        

        
          
          

        

      

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

       

      SAXON
        ASSET SECURITIES COMPANY

      

      

      By:
        /s/
        Ernest G. Bretana        

      Name:
        Ernest G. Bretana

      Title:
        Executive Vice President

      

      SAXON
        MORTGAGE SERVICES, INC.

      

      

      By:
        /s/
        David
        L. Dill            

      Name:
        David L. Dill

      Title:
        Chief Executive Officer and President

      

      

      DEUTSCHE
        BANK
        NATIONAL TRUST

      COMPANY

      

      

      By:
        /s/
        Barbara Campbell        

      Name:
        Barbara Campbell

      Title:
        Vice President

      

      By:
        /s/
        Karlene Benvenuto        

      Name:
        Karlene Benvenuto

      Title:
        Authorized Signer

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      Schedule
        I

       

      MORTGAGE
        LOAN SCHEDULE (BY GROUP)

      

      [On
        file at the offices of Saxon
        Asset Securities Company]

      

      

      

      
        
          
          

        

        
          S-I-1

          
            

          

        

        
          
          

        

      

      Schedule
        II

      

      PASS-THROUGH
        RATE SCHEDULE 

      

      Set
        forth
        below are the Pass-Through Rates for each interest bearing Class of
        Certificates:

      

      Class
        A-1 Pass-Through Rate:
        The
        Pass-Through Rate for the Class A-1 Certificates for the Interest Accrual
        Period
        related to any Distribution Date on or prior to the first related Initial
        Optional Termination Date will be a per annum rate equal to the least of
        (i)
        one-month LIBOR + 0.1300%, (ii) the Aggregate Net WAC Cap and (iii) the Group
        1
        WAC Cap. Beginning with the Interest Accrual period related to the Distribution
        Date immediately following the first related Initial Optional Termination
        Date,
        the Pass-Through Rate for the Class A-1 Certificates will be a per annum
        rate
        equal to the least of (i) one-month LIBOR + 0.2600%, (ii) the Aggregate Net
        WAC
        Cap and (iii) the Group 1 WAC Cap.

      

      Class
        A-2a Pass-Through Rate:
        The
        Pass-Through Rate for the Class A-2a Certificates for the Interest Accrual
        Period related to any Distribution Date on or prior to the first related
        Initial
        Optional Termination Date will be a per annum rate equal to the least of
        (i)
        one-month LIBOR + 0.0800%, (ii) the Aggregate Net WAC Cap and (iii) the Group
        2
        WAC Cap. Beginning with the Interest Accrual period related to the Distribution
        Date immediately following the first related Initial Optional Termination
        Date,
        the Pass-Through Rate for the Class A-2a Certificates will be a per annum
        rate
        equal to the least of (i) one-month LIBOR + 0.1600%, (ii) the Aggregate Net
        WAC
        Cap and (iii) the Group 2 WAC Cap.

      

      Class
        A-2b Pass-Through Rate:
        The
        Pass-Through Rate for the Class A-2b Certificates for the Interest Accrual
        Period related to any Distribution Date on or prior to the first related
        Initial
        Optional Termination Date will be a per annum rate equal to the least of
        (i)
        one-month LIBOR + 0.1100%, (ii) the Aggregate Net WAC Cap and (iii) the Group
        2
        WAC Cap. Beginning with the Interest Accrual period related to the Distribution
        Date immediately following the first related Initial Optional Termination
        Date,
        the Pass-Through Rate for the Class A-2b Certificates will be a per annum
        rate
        equal to the least of (i) one-month LIBOR + 0.2200%, (ii) the Aggregate Net
        WAC
        Cap and (iii) the Group 2 WAC Cap.

      

      Class
        A-2c Pass-Through Rate:
        The
        Pass-Through Rate for the Class A-2c Certificates for the Interest Accrual
        Period related to any Distribution Date on or prior to the first related
        Initial
        Optional Termination Date will be a per annum rate equal to the least of
        (i)
        one-month LIBOR + 0.1500%, (ii) the Aggregate Net WAC Cap and (iii) the Group
        2
        WAC Cap. Beginning with the Interest Accrual period related to the Distribution
        Date immediately following the first related Initial Optional Termination
        Date,
        the Pass-Through Rate for the Class A-2c Certificates will be a per annum
        rate
        equal to the least of (i) one-month LIBOR + 0.3000%, (ii) the Aggregate Net
        WAC
        Cap and (iii) the Group 2 WAC Cap.

      

      
        
          
          

        

        
          S-II-1

          
            

          

        

        
          
          

        

      

      Class
        A-2d Pass-Through Rate: The
        Pass-Through Rate for the Class A-2d Certificates for the Interest Accrual
        Period related to any Distribution Date on or prior to the first related
        Initial
        Optional Termination Date will be a per annum rate equal to the least of
        (i)
        one-month LIBOR + 0.2400%, (ii) the Aggregate Net WAC Cap and (iii) the Group
        2
        WAC Cap. Beginning with the Interest Accrual period related to the Distribution
        Date immediately following the first related Initial Optional Termination
        Date,
        the Pass-Through Rate for the Class A-2d Certificates will be a per annum
        rate
        equal to the least of (i) one-month LIBOR + 0.4800%, (ii) the Aggregate Net
        WAC
        Cap and (iii) the Group 2 WAC Cap.

      

      Class
        B-1 Pass-Through Rate:
        The
        Pass-Through Rate for the Class B-1 Certificates for the Interest Accrual
        Period
        related to any Distribution Date on or prior to the first related Initial
        Optional Termination Date will be a per annum rate equal to the lesser of
        (i)
        one-month LIBOR + 2.1500% and (ii) the Aggregate Net WAC Cap. Beginning with
        the
        Interest Accrual Period related to the Distribution Date immediately following
        the first Initial Optional Termination Date, the Pass-Through Rate for the
        Class
        B-1 Certificates will be a per annum rate equal to the lesser of (i) one-month
        LIBOR + 3.2250% and (ii) the Aggregate Net WAC Cap.

      

      Class
        B-2 Pass-Through Rate:
        The
        Pass-Through Rate for the Class B-2 Certificates for the Interest Accrual
        Period
        related to any Distribution Date on or prior to the first related Initial
        Optional Termination Date will be a per annum rate equal to the lesser of
        (i)
        one-month LIBOR + 2.2500% and (ii) the Aggregate Net WAC Cap. Beginning with
        the
        Interest Accrual Period related to the Distribution Date immediately following
        the first Initial Optional Termination Date, the Pass-Through Rate for the
        Class
        B-2 Certificates will be a per annum rate equal to the lesser of (i) one-month
        LIBOR + 3.3750% and (ii) the Aggregate Net WAC Cap.

      

      Class
        B-3 Pass-Through Rate:
        The
        Pass-Through Rate for the Class B-3 Certificates for the Interest Accrual
        Period
        related to any Distribution Date on or prior to the first related Initial
        Optional Termination Date will be a per annum rate equal to the lesser of
        (i)
        one-month LIBOR + 3.0000% and (ii) the Aggregate Net WAC Cap. Beginning with
        the
        Interest Accrual Period related to the Distribution Date immediately following
        the first Initial Optional Termination Date, the Pass-Through Rate for the
        Class
        B-3 Certificates will be a per annum rate equal to the lesser of (i) one-month
        LIBOR + 4.5000% and (ii) the Aggregate Net WAC Cap.

      

      Class
        M-1 Pass-Through Rate:
        The
        Pass-Through Rate for the Class M-1 Certificates for the Interest Accrual
        Period
        related to any Distribution Date on or prior to the first related Initial
        Optional Termination Date will be a per annum rate equal to the lesser of
        (i)
        one-month LIBOR + 0.2900% and (ii) the Aggregate Net WAC Cap. Beginning with
        the
        Interest Accrual Period related to the Distribution Date immediately following
        the first Initial Optional Termination Date, the Pass-Through Rate for the
        Class
        M-1 Certificates will be a per annum rate equal to the lesser of (i) one-month
        LIBOR + 0.4350% and (ii) the Aggregate Net WAC Cap.

      

      Class
        M-2 Pass-Through Rate:
        The
        Pass-Through Rate for the Class M-2 Certificates for the Interest Accrual
        Period
        related to any Distribution Date on or prior to the first related Initial
        Optional Termination Date will be a per annum rate equal to the lesser of
        (i)
        one-month LIBOR + 0.3200% and (ii) the Aggregate Net WAC Cap. Beginning with
        the
        Interest Accrual Period related to the Distribution Date immediately following
        the first Initial Optional Termination Date, the Pass-Through Rate for the
        Class
        M-2 Certificates will be a per annum rate equal to the lesser of (i) one-month
        LIBOR + 0.4800% and (ii) the Aggregate Net WAC Cap.

      

      
        
          
          

        

        
          S-II-2

          
            

          

        

        
          
          

        

      

      Class
        M-3 Pass-Through Rate:
        The
        Pass-Through Rate for the Class M-3 Certificates for the Interest Accrual
        Period
        related to any Distribution Date on or prior to the first related Initial
        Optional Termination Date will be a per annum rate equal to the lesser of
        (i)
        one-month LIBOR + 0.3900% and (ii) the Aggregate Net WAC Cap. Beginning with
        the
        Interest Accrual Period related to the Distribution Date immediately following
        the first Initial Optional Termination Date, the Pass-Through Rate for the
        Class
        M-3 Certificates will be a per annum rate equal to the lesser of (i) one-month
        LIBOR + 0.5850% and (ii) the Aggregate Net WAC Cap.

      

      Class
        M-4 Pass-Through Rate:
        The
        Pass-Through Rate for the Class M-4 Certificates for the Interest Accrual
        Period
        related to any Distribution Date on or prior to the first related Initial
        Optional Termination Date will be a per annum rate equal to the lesser of
        (i)
        one-month LIBOR + 0.4600% and (ii) the Aggregate Net WAC Cap. Beginning with
        the
        Interest Accrual Period related to the Distribution Date immediately following
        the first Initial Optional Termination Date, the Pass-Through Rate for the
        Class
        M-4 Certificates will be a per annum rate equal to the lesser of (i) one-month
        LIBOR + 0.6900% and (ii) the Aggregate Net WAC Cap.

      

      Class
        M-5 Pass-Through Rate:
        The
        Pass-Through Rate for the Class M-5 Certificates for the Interest Accrual
        Period
        related to any Distribution Date on or prior to the first related Initial
        Optional Termination Date will be a per annum rate equal to the lesser of
        (i)
        one-month LIBOR + 0.6000% and (ii) the Aggregate Net WAC Cap. Beginning with
        the
        Interest Accrual Period related to the Distribution Date immediately following
        the first Initial Optional Termination Date, the Pass-Through Rate for the
        Class
        M-5 Certificates will be a per annum rate equal to the lesser of (i) one-month
        LIBOR + 0.9000% and (ii) the Aggregate Net WAC Cap.

      

      Class
        M-6 Pass-Through Rate:
        The
        Pass-Through Rate for the Class M-6 Certificates for the Interest Accrual
        Period
        related to any Distribution Date on or prior to the first related Initial
        Optional Termination Date will be a per annum rate equal to the lesser of
        (i)
        one-month LIBOR + 0.8000% and (ii) the Aggregate Net WAC Cap. Beginning with
        the
        Interest Accrual Period related to the Distribution Date immediately following
        the first Initial Optional Termination Date, the Pass-Through Rate for the
        Class
        M-6 Certificates will be a per annum rate equal to the lesser of (i) one-month
        LIBOR + 1.2000% and (ii) the Aggregate Net WAC Cap.

      

      
        
          
          

        

        
          S-II-3

          
            

          

        

        
          
          

        

      

      Schedule
        III

      

      The
        Trustee shall make elections to treat each of the segregated groups of assets
        described below as a real estate mortgage investment conduit (each a “REMIC” or,
        in the alternative, “REMIC 1”, “REMIC 2”, and “REMIC 3,” REMIC 3 also being
        referred to as the Upper-Tier REMIC). The Certificates, other than the Class
        R
        Certificate, represent ownership of the regular interests in the Upper-Tier
        REMIC for purposes of the REMIC Provisions. In addition, the Offered
        Certificates represent the right to receive payments in respect of Basis
        Risk
        Carryforward Amounts, which right is not treated as an interest in any REMIC
        created under this agreement. The Class R Certificate represents ownership
        of
        the sole class of residual interest in each of REMIC 1, REMIC 2, and the
        Upper-Tier REMIC for purposes of the REMIC Provisions.

      

      The
        Upper-Tier REMIC shall hold as its assets the several classes of uncertificated
        Lower-Tier Interests in REMIC 2, other than the Class LT2-R Interest, and
        each
        such Lower-Tier Interest is hereby designated as a regular interest in REMIC
        2.
        REMIC 2 shall hold as its assets the several classes of uncertificated
        Lower-Tier Interests in REMIC 1, other than the Class LT1-R Interest, and
        each
        such Lower-Tier Interest is hereby designated as a regular interest in REMIC
        1.
        REMIC 1 shall hold as its assets the property of the Trust Fund other than
        the
        (i) Lower Tier Interests in REMIC 1 and REMIC 2, (ii) the Excess Reserve
        Fund
        Account, (iii) the Cap Agreement (iv) the Swap Agreement, and (v) the
        Supplemental Interest Trust.

      

      The
        startup day for each REMIC created hereby for purposes of the REMIC Provisions
        is the Closing Date. In addition, for purposes of the REMIC Provisions, the
        latest possible maturity date for each regular interest in each REMIC created
        hereby is the Latest Possible Maturity Date.

      

      Definitions
        

      

      Capitalized
        terms used in this Schedule III but not otherwise defined herein or in the
        Agreement shall have the meaning set forth below:

      

      Adjusted
        Net Rate:
        For any
        Distribution Date (and the related Interest Accrual Period), a per annum
        rate
        equal to the product of (i) two and (ii) the REMIC 2 Net WAC, computed for
        this
        purpose by subjecting the interest rate on the Class LT2-Q Interest to a
        cap
        equal to 0% and subjecting the interest rate on each of the other REMIC 2
        Regular Interest to a cap equal to the Pass-Through Rate for such Distribution
        Date on the Corresponding Class of Certificates (each such Pass-Through Rate
        computed for this purpose by substituting “REMIC 2 Net WAC for the applicable
        Net WAC).

      

      Class
        SIO Shortfall:
        For any
        Distribution Date, the excess, if any, of (i) the Net Swap Payment or Swap
        Termination Payment owed to the Swap Counterparty on the Fixed Rate Payer
        Payment Date (as defined in the Swap Agreement) related to such Distribution
        Date over (ii) the amount distributable with respect to the UT-SIO Interest
        in
        REMIC 3 of such Distribution Date.

      

      Corresponding
        Class:
        With
        respect to any REMIC 2 Regular Interest or REMIC 3 Regular Interest, the
        Class
        of Certificates having the same alphanumeric designation as described in
        the
        tables set out in this Schedule III for REMIC 2 and REMIC 3,
        respectively.

      

      
        
          
          

        

        
          S-III-1

          
            

          

        

        
          
          

        

      

      REMIC
        1 Net WAC:
        For any
        Distribution Date, a per annum rate equal to the weighted average of the
        Net
        Mortgage Rates of the Mortgage Loans, weighted based on their relative Stated
        Principal Balances as of the first day of the related Due Period, adjusted
        to
        reflect prepayments received after the first Day of the related Due Period
        that
        were distributed on the immediately preceding Distribution Date.

      

      REMIC
        2 Net WAC:
        For any
        Distribution Date, the weighted average of the interest rates on the REMIC
        1
        Regular Interests (other than the LT1-P Interest) for such Distribution Date.
        

      

      REMIC
        Swap Rate:
        A per
        annum rate pf 9.60%. 

      

      Swap
        LIBOR:
        A per
        annum rate equal to the product of (i) the Floating Rate Option (as defined
        in
        the Swap Agreement) for the Distribution Date, multiplied by (ii) two multiplied
        by (iii) the quotient of the actual number of days in the Interest Accrual
        Period divided by 30. 

      

      REMIC
        1 

      

      The
        following table sets forth the designations, initial principal amounts, and
        interest rates for each interest in REMIC 2, each of which (other than the
        Class
        LT2-R Interest is hereby designated as a regular interest in REMIC 1 (the
“REMIC
        1 Regular Interests”):

      

      
        	
                REMIC
                  1 Lower-

                Tier
                  Designation

              	 	
                Initial Principal 

                Amount

              	 	
                REMIC
                  1 Lower-

                Tier

                Interest
                  Rate

              
	
                LT1-A

              	 	
                $     241,151,259.65

              	 	
                (1)

              
	
                LT1-F1

              	 	
                $         7,920,678.74

              	 	
                (2)

              
	
                LT1-V1

              	 	
                $         7,920,678.74

              	 	
                (3)

              
	
                LT1-F2

              	 	
                $         7,686,807.85

              	 	
                (2)

              
	
                LT1-V2

              	 	
                $         7,686,807.85

              	 	
                (3)

              
	
                LT1-F3

              	 	
                $         7,390,571.05

              	 	
                (2)

              
	
                LT1-V3

              	 	
                $         7,390,571.05

              	 	
                (3)

              
	
                LT1-F4

              	 	
                $         7,085,086.31

              	 	
                (2)

              
	
                LT1-V4

              	 	
                $         7,085,086.31

              	 	
                (3)

              
	
                LT1-F5

              	 	
                $         6,775,296.01

              	 	
                (2)

              
	
                LT1-V5

              	 	
                $         6,775,296.01

              	 	
                (3)

              
	
                LT1-F6

              	 	
                $         6,486,824.49

              	 	
                (2)

              
	
                LT1-V6

              	 	
                $         6,486,824.49

              	 	
                (3)

              
	
                LT1-F7

              	 	
                $         6,210,725.20

              	 	
                (2)

              
	
                LT1-V7

              	 	
                $         6,210,725.20

              	 	
                (3)

              
	
                LT1-F8

              	 	
                $         6,045,997.02

              	 	
                (2)

              
	
                LT1-V8

              	 	
                $         6,045,997.02

              	 	
                (3)

              
	
                LT1-F9

              	 	
                $         5,773,008.56

              	 	
                (2)

              
	
                LT1-V9

              	 	
                $         5,773,008.56

              	 	
                (3)

              
	
                LT1-F10

              	 	
                $         7,759,583.38

              	 	
                (2)

              
	
                LT1-V10

              	 	
                $         7,759,583.38

              	 	
                (3)

              
	
                LT1-F11

              	 	
                $       28,256,238.36

              	 	
                (2)

              
	
                LT1-V11

              	 	
                $       28,256,238.36

              	 	
                (3)

              

      

      

      
        
          
          

        

        
          S-III-2

          
            

          

        

        
          
          

        

      

      

      
        	
                REMIC
                  1 Lower-

                Tier
                  Designation

              	 	
                Initial Principal 

                Amount

              	 	
                REMIC
                  1 Lower-

                Tier

                Interest
                  Rate

              
	
                LT1-V12

              	 	
                $         4,188,418.26

              	 	
                (3)

              
	
                LT1-F13

              	 	
                $         3,677,954.29

              	 	
                (2)

              
	
                LT1-V13

              	 	
                $         3,677,954.29

              	 	
                (3)

              
	
                LT1-F14

              	 	
                $         3,577,364.79

              	 	
                (2)

              
	
                LT1-V14

              	 	
                $         3,577,364.79

              	 	
                (3)

              
	
                LT1-F15

              	 	
                $         3,419,503.11

              	 	
                (2)

              
	
                LT1-V15

              	 	
                $         3,419,503.11

              	 	
                (3)

              
	
                LT1-F16

              	 	
                $         4,463,851.95

              	 	
                (2)

              
	
                LT1-V16

              	 	
                $         4,463,851.95

              	 	
                (3)

              
	
                LT1-F17

              	 	
                $       15,369,652.16

              	 	
                (2)

              
	
                LT1-V17

              	 	
                $       15,369,652.16

              	 	
                (3)

              
	
                LT1-F18

              	 	
                $         2,544,477.83

              	 	
                (2)

              
	
                LT1-V18

              	 	
                $         2,544,477.83

              	 	
                (3)

              
	
                LT1-F19

              	 	
                $         2,261,421.86

              	 	
                (2)

              
	
                LT1-V19

              	 	
                $         2,261,421.86

              	 	
                (3)

              
	
                LT1-F20

              	 	
                $         2,186,174.60

              	 	
                (2)

              
	
                LT1-V20

              	 	
                $         2,186,174.60

              	 	
                (3)

              
	
                LT1-F21

              	 	
                $         2,144,774.10

              	 	
                (2)

              
	
                LT1-V21

              	 	
                $         2,144,774.10

              	 	
                (3)

              
	
                LT1-F22

              	 	
                $         5,758,546.03

              	 	
                (2)

              
	
                LT1-V22

              	 	
                $         5,758,546.03

              	 	
                (3)

              
	
                LT1-F23

              	 	
                $       13,574,001.36

              	 	
                (2)

              
	
                LT1-V23

              	 	
                $       13,574,001.36

              	 	
                (3)

              
	
                LT1-F24

              	 	
                $         1,379,340.30

              	 	
                (2)

              
	
                LT1-V24

              	 	
                $         1,379,340.30

              	 	
                (3)

              
	
                LT1-F25

              	 	
                $         1,086,575.35

              	 	
                (2)

              
	
                LT1-V25

              	 	
                $         1,086,575.35

              	 	
                (3)

              
	
                LT1-F26

              	 	
                $         1,044,858.67

              	 	
                (2)

              
	
                LT1-V26

              	 	
                $         1,044,858.67

              	 	
                (3)

              
	
                LT1-F27

              	 	
                $         1,031,793.10

              	 	
                (2)

              
	
                LT1-V27

              	 	
                $         1,031,793.10

              	 	
                (3)

              
	
                LT1-F28

              	 	
                $         2,755,924.48

              	 	
                (2)

              
	
                LT1-V28

              	 	
                $         2,755,924.48

              	 	
                (3)

              
	
                LT1-F29

              	 	
                $         5,009,961.33

              	 	
                (2)

              
	
                LT1-V29

              	 	
                $         5,009,961.33

              	 	
                (3)

              
	
                LT1-F30

              	 	
                $            726,561.04

              	 	
                (2)

              
	
                LT1-V30

              	 	
                $            726,561.04

              	 	
                (3)

              
	
                LT1-F31

              	 	
                $            603,880.75

              	 	
                (2)

              
	
                LT1-V31

              	 	
                $            603,880.75

              	 	
                (3)

              
	
                LT1-F32

              	 	
                $            582,354.92

              	 	
                (2)

              
	
                LT1-V32

              	 	
                $            582,354.92

              	 	
                (3)

              
	
                LT1-F33

              	 	
                $            570,397.27

              	 	
                (2)

              

      

      

      
        
          
          

        

        
          S-III-3

          
            

          

        

        
          
          

        

      

      

      
        	
                REMIC
                  1 Lower-

                Tier
                  Designation

              	 	
                Initial Principal 

                Amount

              	 	
                REMIC
                  1 Lower-

                Tier

                Interest
                  Rate

              
	
                LT1-F34

              	 	
                $         1,124,631.16

              	 	
                (2)

              
	
                LT1-V34

              	 	
                $         1,124,631.16

              	 	
                (3)

              
	
                LT1-F35

              	 	
                $         1,852,989.97

              	 	
                (2)

              
	
                LT1-V35

              	 	
                $         1,852,989.97

              	 	
                (3)

              
	
                LT1-F36

              	 	
                $            449,212.83

              	 	
                (2)

              
	
                LT1-V36

              	 	
                $            449,212.83

              	 	
                (3)

              
	
                LT1-F37

              	 	
                $            402,422.44

              	 	
                (2)

              
	
                LT1-V37

              	 	
                $            402,422.44

              	 	
                (3)

              
	
                LT1-F38

              	 	
                $            388,818.61

              	 	
                (2)

              
	
                LT1-V38

              	 	
                $            388,818.61

              	 	
                (3)

              
	
                LT1-F39

              	 	
                $            375,666.76

              	 	
                (2)

              
	
                LT1-V39

              	 	
                $            375,666.76

              	 	
                (3)

              
	
                LT1-F40

              	 	
                $            362,952.21

              	 	
                (2)

              
	
                LT1-V40

              	 	
                $            362,952.21

              	 	
                (3)

              
	
                LT1-F41

              	 	
                $            350,660.74

              	 	
                (2)

              
	
                LT1-V41

              	 	
                $            350,660.74

              	 	
                (3)

              
	
                LT1-F42

              	 	
                $            338,778.59

              	 	
                (2)

              
	
                LT2-V42

              	 	
                $            338,778.59

              	 	
                (3)

              
	
                LT1-F43

              	 	
                $            327,292.40

              	 	
                (2)

              
	
                LT1-V43

              	 	
                $            327,292.40

              	 	
                (3)

              
	
                LT1-F44

              	 	
                $         9,188,203.02

              	 	
                (2)

              
	
                LT1-V44

              	 	
                $         9,188,203.02

              	 	
                (3)

              
	
                LT1-P

              	 	
                $                1,000.00

              	 	
                0.00%

              
	
                LT2-R

              	 	
                (4)

              	 	
                (4)

              

      

      ___________________________

      
        	
                (1)

              	
                For
                  any Distribution Date (and the related Interest Accrual Period)
                  the
                  interest rate for the LT1-A Interest shall equal the REMIC 1 Net
                  WAC.

              

      

       

      
        	
                (2)

              	
                For
                  any Distribution Date (and the related Interest Accrual Period)
                  the
                  interest rate for each of these REMIC 1 Regular Interests shall
                  be the
                  lesser of (i) the REMIC Swap Rate and (ii) the product of (a) two
                  multiplied by (b) the REMIC 1 Net
                  WAC.

              

      

       

      
        	
                (3)

              	
                For
                  any Distribution Date (and the related Interest Accrual Period)
                  the
                  interest rate for each of these REMIC 1 Regular Interests shall
                  be the
                  excess, if any, of (i) the product of (a) two multiplied by (b)
                  the REMIC
                  1 Net WAC over (ii) the REMIC Swap Rate.

              

      

       

      
        	
                (4)

              	
                The
                  LT1-R Interest is the sole residual interest in REMIC 1. It does
                  not have
                  a principal amount or an interest
                  rate.

              

      

       

      On
        each
        Distribution Date, the Trustee shall distribute interest with respect to
        each of
        the REMIC 1 Regular Interests based on the above-described interest
        rates.

       

      On
        each
        Distribution Date, the Trustee shall distribute the principal with respect
        to
        the REMIC 1 Regular Interests in the following order of priority:

       

      
        
          
          

        

        
          S-III-4

          
            

          

        

        
          
          

        

      

      (i)
        to
        the Class LT1-A Interest until its principal balance is reduced to zero;
        and

       

      (ii)
        then
        sequentially, to the other REMIC 1 Regular Interests (other than the LT1-P
        Interest) in ascending order of their numerical designation, and, with respect
        to each pair of REMIC 1 Regular Interests having the same numerical designation,
        in equal amounts to each such REMIC 1 Regular Interest, until the principal
        balance of each such REMIC 1 Regular Interest is reduced to zero. 

       

      Realized
        losses shall be allocated among the REMIC 1 Regular Interests in the same
        manner
        that principal distributions are allocated.

       

      On
        each
        Distribution Date, the Prepayment Penalties collected during the preceding
        calendar month, shall be allocated to the LT1-P Interest, and, on the
        Distribution Date immediately following the expiration of the latest
        Distribution Date upon which a Mortgage Loan would be subject to a Prepayment
        Penalty upon prepayment, principal shall be distributed in respect of the
        LT1-P
        Interest until its principal balance is reduced to zero.

       

      REMIC
        2

       

      The
        following table sets forth the designations, initial principal amounts, and
        interest rates for each interest in REMIC 2, each of which (other than the
        Class
        LT3-R Interest) is hereby designated as a regular interest in REMIC 2 (the
        “REMIC 2 Regular Interests”):

       

      
        	
                REMIC
                  2

                Lower
                  Tier 

                Designation

              	 	
                REMIC
                  2

                Lower
                  Tier

                Interest
                  Rate

              	 	
                Initial
                  

                Principal
                  Amount

              	 	
                Corresponding
                  Class 

                of
                  Certificate(s)

              
	
                LT2-A-1

              	 	
                (1)

              	 	
                $     104,535,500.00

              	 	
                A-1

              
	
                LT2-A-2a

              	 	
                (1)

              	 	
                $       69,985,000.00

              	 	
                A-2a

              
	
                LT2-A-2b

              	 	
                (1)

              	 	
                $       17,915,000.00

              	 	
                A-2b

              
	
                LT2-A-2c

              	 	
                (1)

              	 	
                $       27,375,000.00

              	 	
                A-2c

              
	
                LT2-A-2d

              	 	
                (1)

              	 	
                $       13,814,500.00

              	 	
                A-2d

              
	
                LT2-M-1

              	 	
                (1)

              	 	
                $       12,910,000.00

              	 	
                M-1

              
	
                LT2-M-2

              	 	
                (1)

              	 	
                $       13,221,000.00

              	 	
                M-2

              
	
                LT2-M-3

              	 	
                (1)

              	 	
                $         6,844,000.00

              	 	
                M-3

              
	
                LT2-M-4

              	 	
                (1)

              	 	
                $         6,066,000.00

              	 	
                M-4

              
	
                LT2-M-5

              	 	
                (1)

              	 	
                $         5,755,000.00

              	 	
                M-5

              
	
                LT2-M-6

              	 	
                (1)

              	 	
                $         5,133,000.00

              	 	
                M-6

              
	
                LT2-B-1

              	 	
                (1)

              	 	
                $         4,822,000.00

              	 	
                B-1

              
	
                LT2-B-2

              	 	
                (1)

              	 	
                $         4,199,500.00

              	 	
                B-2

              
	
                LT2-B-3

              	 	
                (1)

              	 	
                $         3,888,500.00

              	 	
                B-3

              
	
                LT2-P

              	 	
                0.00%

              	 	
                $                1,000.00

              	 	
                P

              
	
                LT2-Q

              	 	
                (1)

              	 	
                $     325,707,726.00

              	 	
                N/A

              
	
                LT2-SIO

              	 	
                (2)

              	 	
                (2)

              	 	
                OC

              
	
                LT2-R

              	 	
                (3)

              	 	
                (3)

              	 	
                R

              

      

      ___________________________

      
        	 	
                (1)

              	
                For
                  any Distribution Date (and the related Interest Accrual Period)
                  the
                  interest rate for each of these REMIC 2 Regular Interests is a
                  per annum
                  rate equal to the weighted average of the interest rates on the
                  REMIC 1
                  Regular Interests for such Distribution Date, provided,
                  however, that
                  for any Distribution Date on which the Class LT2-SIO Interest is
                  entitled
                  to a portion of the interest accruals on a REMIC 1 Regular Interest
                  having
                  an “F” in its designation, as described in footnote (2) below, such
                  weighted average shall be computed by first subjecting the rate
                  on such
                  REMIC 1 Regular Interest to a cap equal to Swap LIBOR for such
                  Distribution Date. 

              

      

       

      
        
          
          

        

        
          S-III-5

          
            

          

        

        
          
          

        

      

      
        	 	
                (2)

              	
                The
                  Class LT2-SIO Interest is an interest only REMIC 2 Regular Interest
                  that
                  does not have a principal balance. For only those Distribution
                  Dates
                  listed in the first column in the table below, the Class LT2-SIO
                  Interest
                  shall be entitled to interest accrued on the REMIC 1 Regular Interests
                  listed in the second column in the table below at a per annum rate
                  equal
                  to the excess, if any, of (i) the interest rate for such REMIC
                  1 Regular
                  Interest for such Distribution Date over (ii) Swap LIBOR for such
                  Distribution Date.

              

      

       

      
        	
                Distribution
                  Dates

              	
                REMIC
                  1 Class Designation

              
	
                12

              	
                LT1-F1

              
	
                12-13

              	
                LT1-F2

              
	
                12-14

              	
                LT1-F3

              
	
                12-15

              	
                LT1-F4

              
	
                12-16

              	
                LT1-F5

              
	
                12-17

              	
                LT1-F6

              
	
                12-18

              	
                LT1-F7

              
	
                12-19

              	
                LT1-F8

              
	
                12-20

              	
                LT1-F9

              
	
                12-21

              	
                LT1-F10

              
	
                12-22

              	
                LT1-F11

              
	
                12-23

              	
                LT1-F12

              
	
                12-24

              	
                LT1-F13

              
	
                12-25

              	
                LT1-F14

              
	
                12-26

              	
                LT1-F15

              
	
                12-27

              	
                LT1-F16

              
	
                12-28

              	
                LT1-F17

              
	
                12-29

              	
                LT1-F18

              
	
                12-30

              	
                LT1-F19

              
	
                12-31

              	
                LT1-F20

              
	
                12-32

              	
                LT1-F21

              
	
                12-33

              	
                LT1-F22

              
	
                12-34

              	
                LT1-F23

              
	
                12-35

              	
                LT1-F24

              
	
                12-36

              	
                LT1-F25

              
	
                12-37

              	
                LT1-F26

              
	
                12-38

              	
                LT1-F27

              
	
                12-39

              	
                LT1-F28

              
	
                12-40

              	
                LT1-F29

              
	
                12-41

              	
                LT1-F30

              
	
                12-42

              	
                LT1-F31

              
	
                12-43

              	
                LT1-F32

              
	
                12-44

              	
                LT1-F33

              
	
                12-45

              	
                LT1-F34

              
	
                12-46

              	
                LT1-F35

              
	
                12-47

              	
                LT1-F36

              

      

      

      
        
          
          

        

        
          S-III-6

          
            

          

        

        
          
          

        

      

      

      
        	
                12-48

              	
                LT1-F37

              
	
                12-49

              	
                LT1-F38

              
	
                12-50

              	
                LT1-F39

              
	
                12-51

              	
                LT1-F40

              
	
                12-52

              	
                LT1-F41

              
	
                12-53

              	
                LT1-F42

              
	
                12-54

              	
                LT1-F43

              
	
                12-55

              	
                LT1-F44

              

      

      

       

      
        	 	
                (3)

              	
                The
                  Class LT2-R interest is the sole residual interests in REMIC 2.
                  It does
                  not have an interest rate or a principal
                  balance.

              

      

       

      On
        each
        Distribution Date, interest shall be distributed on the REMIC 2 Regular
        Interests based on the above-described interest rates,
        provided, however,
        that
        interest that accrues on the LT2-Q Interest shall be deferred in an amount
        equal
        to one-half of the increase, if any, in the Overcollateralization Amount
        for
        such Distribution Date. Any interest so deferred shall itself bear interest
        at
        the interest rate for the LT2-Q Interest. An amount equal to the interest
        so
        deferred shall be distributed as additional principal on the other REMIC
        2
        Regular Interests that have a principal balance in the manner described under
        priority first
        below.

       

      On
        each
        Distribution Date principal shall be distributed, and Realized Losses shall
        be
        allocated, among the REMIC 2 Regular Interests in the following order of
        priority:

       

      First,
        to each
        REMIC 2 Regular Interest for which there is a Corresponding Class of
        Certificates until the principal balance of each such REMIC 2 Regular Interest
        equals one-half of the Class Certificate Balance of the Corresponding Class
        of
        Certificates immediately after such Distribution Date; and

       

      Second,
        to the
        Class LT2-Q Interests, any remaining amounts.

       

      On
        each
        Distribution Date, all amounts distributable with respect to the LT1-P Interest
        in REMIC 1 shall be passed through on the LT2-P Interest in REMIC
        2.

       

      REMIC
        3

      

      The
        following table sets forth the designations, initial principal amounts, and
        interest rates for each interest in REMIC 3, each of which (other than the
        Class
        UT-R Interest) is hereby designated as a regular interest in REMIC 3(the
“REMIC
        3 Regular Interests”): 

       

      
        	
                REMIC
                  3

                Designation

              	 	
                REMIC
                  3

                Interest
                  Rate

              	 	
                Initial Principal Amount

              	 	
                Corresponding
                  Class 

                of
                  Certificates

              
	
                UT-A-1

              	 	
                (1)

              	 	
                $    209,071,000.00

              	 	
                A-1

              
	
                UT-A-2a

              	 	
                (1)

              	 	
                $    139,970,000.00

              	 	
                A-2a

              
	
                UT-A-2b

              	 	
                (1)

              	 	
                $      35,830,000.00

              	 	
                A-2b

              
	
                UT-A-2c

              	 	
                (1)

              	 	
                $      54,750,000.00

              	 	
                A-2c

              
	
                UT-A-2d

              	 	
                (1)

              	 	
                $      27,629,000.00

              	 	
                A-2d

              
	
                UT-M-1

              	 	
                (1)

              	 	
                $      25,820,000.00

              	 	
                M-1

              

      

       

      
        
          
          

        

        
          S-III-7

          
            

          

        

        
          
          

        

      

       

      
        	
                REMIC
                  3

                Designation

              	 	
                REMIC
                  3

                Interest
                  Rate

              	 	
                Initial Principal Amount

              	 	
                Corresponding
                  Class 

                of
                  Certificates

              
	
                UT-M-2

              	 	
                (1)

              	 	
                $      26,442,000.00

              	 	
                M-2

              
	
                UT-M-3

              	 	
                (1)

              	 	
                $      13,688,000.00

              	 	
                M-3

              
	
                UT-M-4

              	 	
                (1)

              	 	
                $      12,132,000.00

              	 	
                M-4

              
	
                UT-M-5

              	 	
                (1)

              	 	
                $      11,510,000.00

              	 	
                M-5

              
	
                UT-M-6

              	 	
                (1)

              	 	
                $      10,266,000.00

              	 	
                M-6

              
	
                UT-B-1

              	 	
                (1)

              	 	
                $        9,644,000.00

              	 	
                B-1

              
	
                UT-B-2

              	 	
                (1)

              	 	
                $        8,399,000.00

              	 	
                B-2

              
	
                UT-B-3

              	 	
                (1)

              	 	
                $        7,777,000.00

              	 	
                B-3

              
	
                UT-P

              	 	
                0.00%

              	 	
                $               1,000.00

              	 	
                P

              
	
                S-IO

              	 	
                (2)

              	 	
                (2)

              	 	
                C-2

              
	
                OC

              	 	
                (3)

              	 	
                (3)

              	 	
                C-2

              
	
                UT-R

              	 	
                (4)

              	 	
                (4)

              	 	
                R

              

      

       

      
        	 	
                (1)

              	
                For
                  any Distribution Date, the interest rate for each of these REMIC
                  3 Regular
                  Interests shall equal the Pass-Through Rate for the Corresponding
                  Class of
                  Certificates, provided, however, that references in the definition
                  of
                  Pass-Through Rate to the applicable Net WAC Cap shall be deemed,
                  for
                  purposes of the REMIC Provisions, to be references to a per annum
                  rate
                  equal to the product of (i) the REMIC 2 Net WAC multiplied by (ii)
                  the
                  quotient of 30 divided by the actual number of days in the related
                  Interest Accrual Period. If, on any Distribution Date, the interest
                  rate
                  on any of these REMIC 3 Regular Interests exceeds the Pass-Through
                  Rate on
                  the Corresponding Class of Certificates, then the excess interest
                  so
                  accrued shall be treated as having been paid to the beneficial
                  owner of
                  the affected Class of Certificates and then paid by such beneficial
                  owner
                  to (i) the Supplemental Interest Trust to the extent of any Class
                  SIO
                  Shortfalls(such Class SIO Shortfalls to be apportioned ratably
                  among the
                  REMIC 3 Regular Interests in proportion to the amount of excess
                  interest,
                  if any, accrued on each such REMIC 3 Regular Interest) , or (ii)
                  to the
                  Excess Reserve Fund Account, any additional excess. If for any
                  REMIC 3
                  Regular Interest, the Pass-Through Rate on the Corresponding Class
                  of
                  Certificates exceeds the REMIC 2 Net WAC, interest distributions
                  in
                  respect of such excess shall be treated for purposes of the REMIC
                  Provisions as having been paid from the Excess Reserve Fund Account.
                  

              

      

       

      
        	 	
                (2)

              	
                The
                  UT3-SIO Interest is any interest only interest; it does not have
                  a
                  principal amount. For each Distribution Date, the UT3-SIO Interest
                  shall
                  be entitled to all amounts distributed on such Distribution Date
                  with
                  respect to the LT2-SIO Interest. Ownership of the UT3-SIO shall
                  be
                  evidenced by the Class OC Certificates.

              

      

       

      
        	 	
                (3)

              	
                For
                  purposes of the REMIC Provisions, the UT-OC Interest comprises
                  two
                  components, a principal only component and an interest only component.
                  The
                  principal amount of the principal only component equals the
                  Overcollateralization Amount on the Closing Date. The interest
                  only
                  component has a notional amount equal at al times to the sum of
                  the
                  principal amounts of the REMIC 2 Regular Interests (other than
                  the LT2-P
                  and LT2-SIO Interests). For each Distribution Date (and the related
                  Interest Accrual Period), the UT-OC Interest shall accrue interest
                  at a
                  per annum rate equal to the excess, if any, of (i) the REMIC 2
                  Net WAC
                  over (ii) the Adjusted Net Rate. Interest accrued on the UT-OC
                  Interest
                  during each Interest Accrual Period shall be deferred to the extent
                  it is
                  applied to increase the Overcollateralization Amount for the related
                  Distribution Date. Any interest so deferred shall not itself bear
                  interest. Ownership of the UT-OC Interest shall be evidenced by
                  the Class
                  OC Certificate. 

              

      

       

      
        	 	
                (4)

              	
                The
                  UT-R Interest is the sole residual interest in the Upper-Tier REMIC.
                  It
                  does not have an interest rate or a principal balance. The Class
                  R
                  Certificate evidences ownership of the LT1-R, LT2-R, and UT-R
                  Interests.

              

      

       

      
        
          
          

        

        
          S-III-8

          
            

          

        

        
          
          

        

      

      For
        any Distribution Date, distributions shall be made and Realized Losses shall
        be
        allocated among the REMIC 3 Regular Interests in the same manner in which
        such
        amounts are allocated among the Corresponding Classes of Certificates as
        provided in this Agreement.

       

      

      
        
          
          

        

        
          S-III-9

          
            

          

        

        
          
          

        

      

      EXHIBIT
        A

       

      FORM
        OF SENIOR CERTIFICATES

       

      

       

      
        
          
          

        

        
          A-1

          
            

          

        

        
          
          

        

      

      EXHIBIT
        B

       

      FORM
        OF SUBORDINATE CERTIFICATES

       

      
        
          
          

        

        
          B-1

          
            

          

        

        
          
          

        

      

      EXHIBIT
        C

       

      FORM
        OF INITIAL CERTIFICATION OF TRUSTEE

       

      March
        __,
        2007

       

      Deutsche
        Bank National Trust Company, as Trustee

      1761
        East
        St. Andrew Place

      Santa
        Ana, California 92705

      

      Saxon
        Asset Securities Company

      4860
        Cox
        Road

      Glen
        Allen, Virginia 23060

      Attention:
        President

       

      SAXON
        ASSET SECURITIES COMPANY

      MORTGAGE
        LOAN ASSET BACKED

      SECURITIES,
        SERIES 2007-1

       

      Ladies
        and Gentlemen:

       

      In
        accordance with Section 2.3(a) of the Standard Terms of Custody Agreement
        (June
        2000 Edition) (the “Standard Terms”) incorporated into the Custody Agreement,
        dated as of February 1, 2007 (together with the Standard Terms, the “Custody
        Agreement”), between Deutsche Bank National Trust Company, as trustee (the
“Trustee”), and Deutsche Bank National Trust Company, as custodian (the
“Custodian”), the Custodian hereby certifies that it has received and is holding
        a Mortgage File with respect to each Mortgage Loan (other than any Mortgage
        Loan
        listed on the schedule of exceptions attached hereto) listed on Schedule
        I (a
        copy of which is attached hereto) to the Custody Agreement.

       

      In
        connection therewith, the Custodian has examined each Mortgage File to confirm
        that:

       

      (i) no
        Note,
        on the face or the reverse side(s) thereof, contains evidence, except for
        the
        endorsement to the Custodian, of any unsatisfied claims, liens, security
        interests, encumbrances or restrictions on transfer;

       

      (ii) the
        Note
        bears an endorsement that appears to be an original either in blank or to
        the
        Custodian, as set forth substantially as follows “Without Recourse, pay to the
        order of Bankers Trust Company or Deutsche Bank National Trust Company, as
        Custodian or Trustee”;

       

      (iii) all
        documents required to be contained in the Mortgage File are in its
        possession;

       

      (iv) such
        documents have been reviewed by it and appear to relate to such Mortgage
        Loan
        and are not torn or mutilated; and

       

      
        
          
          

        

        
          C-1

          
            

          

        

        
          
          

        

      

      (v) based
        on
        its examination and only as to the foregoing documents, the mortgage information
        set forth on the Mortgage Loan Schedule, with respect to the loan number,
        mortgagor name, property address (including city, state and zip code),
        origination date and maturity date, accurately reflects information set forth
        in
        the Mortgage File and each balance listed as the “Original Balance” on Schedule
        I to the Custody Agreement is identical to the original principal amount
        of the
        corresponding Note (or, if applicable, the amount set forth in a lost note
        affidavit).

       

      The
        Custodian further certifies that the Custodian’s review of each Mortgage File
        included each of the procedures set forth in Section 2.3(a) of the Standard
        Terms.

       

      The
        Custodian has not (1) inspected, reviewed or examined any such documents,
        instruments, securities or other papers to determine that they or the signatures
        thereon are genuine, enforceable, or appropriate for the represented purpose,
        any such documents, instruments, securities or other papers have actually
        been
        recorded or that any document that appears to be an original is in fact an
        original, or (2) determined whether any Mortgage File should include any
        surety
        or guaranty, Note Assumption Rider, buydown agreement, assumption agreement,
        modification agreement, written assurance or substitution
        agreement.

       

      Capitalized
        words and phrases used herein shall have the respective meanings assigned
        to
        them in the Custody Agreement.

       

      DEUTSCHE
        BANK NATIONAL TRUST 

      COMPANY,
        as Custodian

       

      By:____________________________________

      Name:__________________________________

      Title:
        ___________________________________

      

      
        
          
          

        

        
          C-2

          
            

          

        

        
          
          

        

      

      EXHIBIT
        D

       

      FORM
        OF FINAL CERTIFICATION OF TRUSTEE

       

      ____
        __,
        2007

       

       

      Deutsche
        Bank National Trust Company, as Trustee

      1761
        East
        St. Andrew Place

      Santa
        Ana, California 92705

       

      Saxon
        Asset Securities Company

      4860
        Cox
        Road

      Glen
        Allen, Virginia 23060

      Attention:
        President

       

      Saxon
        Mortgage Services, Inc.

      4708
        Mercantile Drive

      Fort
        Worth, Texas 76137 

      Attention:
        President

       

      SAXON
        ASSET SECURITIES COMPANY

      MORTGAGE
        LOAN ASSET BACKED

      SECURITIES,
        SERIES 2007-1

       

      Ladies
        and Gentlemen:

       

      In
        accordance with (i) Section 2.02 of the Pooling and Servicing Agreement among
        Saxon Asset Securities Company, as depositor, Saxon Mortgage Services, Inc.,
        as
        servicer and Deutsche Bank National Trust Company, as trustee (the “Trustee”)
        and (ii) Section 2.3(a) of the Standard Terms of Custody Agreement (June
        2000
        Edition) (the “Standard Terms”) incorporated into the Custody Agreement, dated
        as of February 1, 2007 (together with the Standard Terms, the “Custody
        Agreement”), between the Trustee, and Deutsche Bank National Trust Company, as
        custodian (the “Custodian”), the Custodian hereby certifies that it has received
        and is holding a Mortgage File with respect to each Mortgage Loan (other
        than
        any Mortgage Loan listed on the schedule of exceptions attached hereto) listed
        on Schedule I (a copy of which is attached hereto) to the Custody
        Agreement.

       

      In
        connection therewith, the Custodian has examined each Mortgage File to confirm
        that:

       

      (vi) no
        Note,
        on the face or the reverse side(s) thereof, contains evidence, except for
        the
        endorsement to the Custodian, of any unsatisfied claims, liens, security
        interests, encumbrances or restrictions on transfer;

       

      
        
          
          

        

        
          D-1

          
            

          

        

        
          
          

        

      

      (vii) the
        Note
        bears an endorsement that appears to be an original either in blank or to
        the
        Custodian, as set forth substantially as follows “Without Recourse, pay to the
        order of Bankers Trust Company or Deutsche Bank National Trust Company, as
        Custodian or Trustee”;

       

      (viii) all
        documents required to be contained in the Mortgage File are in its
        possession;

       

      (ix) such
        documents have been reviewed by it and appear to relate to such Mortgage
        Loan
        and are not torn or mutilated; and

       

      (x) based
        on
        its examination and only as to the foregoing documents, the mortgage information
        set forth on the Mortgage Loan Schedule, with respect to the loan number,
        mortgagor name, property address (including city, state and zip code),
        origination date and maturity date, accurately reflects information set forth
        in
        the Mortgage File and each balance listed as the “Original Balance” on Schedule
        I to the Custody Agreement is identical to the original principal amount
        of the
        corresponding Note (or, if applicable, the amount set forth in a lost note
        affidavit).

       

      The
        Custodian further certifies that the Custodian’s review of each Mortgage File
        included each of the procedures set forth in Section 2.3(a) of the Standard
        Terms.

       

      The
        Custodian has not (1) inspected, reviewed or examined any such documents,
        instruments, securities or other papers to determine that they or the signatures
        thereon are genuine, enforceable, or appropriate for the represented purpose,
        any such documents, instruments, securities or other papers have actually
        been
        recorded or that any document that appears to be an original is in fact an
        original, or (2) determined whether any Mortgage File should include any
        surety
        or guaranty, Note Assumption Rider, buydown agreement, assumption agreement,
        modification agreement, written assurance or substitution
        agreement.

       

      Capitalized
        words and phrases used herein shall have the respective meanings assigned
        to
        them in the Custody Agreement.

       

      DEUTSCHE
        BANK NATIONAL TRUST 

      COMPANY,
        as Custodian

       

      By:____________________________________

      Name:__________________________________

      Title:
        ___________________________________

      

       

       

       

      
        
          
          

        

        
          D-2

          
            

          

        

        
          
          

        

      

      EXHIBIT
        E

       

      U.S.
        PERSON AFFIDAVIT

      PURSUANT
        TO SECTIONS 860D(a)(6)(A) and 860E(e)(4)

      OF
        THE INTERNAL REVENUE CODE OF 1986, AS AMENDED

      

      Re:
        Saxon
        Asset Securities Company 

      Series
        2007-1 Trust (the “Trust”) 

      Mortgage
        Loan Asset Backed Certificates, Class R 

      

      STATE
        OF
        [                          
]

      ss:

      CITY
        OF
        [                          
]

      

      Under
        penalties of perjury, I, the undersigned, declare that to the best of my
        knowledge and belief, the following representations are true, correct and
        complete: 

       

      1. I
        am a
        duly authorized officer of
        [                              
 ], a
        [                                  
] (the “Transferee”) and on behalf of which I have the authority to make this
        affidavit.

       

      2. The
        Transferee is acquiring all or a portion of the Class R Certificates (the
        “Residual Certificates”), which represent a residual interest in one or more
        real estate mortgage investment conduits (each, a “REMIC”) for which elections
        are to be made under Section 860D of the Internal Revenue Code of 1986, as
        amended (the “Code”). 

       

      3. The
        Transferee either is (i) a citizen or resident of the United States, (ii)
        a
        domestic partnership or corporation, (iii) an estate or trust that is subject
        to
        United States federal income tax regardless of the source of its income,
        or (iv)
        a foreign person who would be subject to United States income taxation on
        a net
        basis on income derived from the Residual Certificates (a “U.S.
        Person”).

       

      4. The
        Transferee is not a “Disqualified Organization” (as defined below), and the
        Transferee is not acquiring a Residual Certificate for the account of, or
        as
        agent or nominee of, or with a view to the transfer of direct or indirect
        record
        or beneficial ownership to, a Disqualified Organization. For the purposes
        hereof, a Disqualified Organization is any of the following: (i) the United
        States, any state or political subdivision thereof, any foreign government,
        any
        international organization, or any agency or instrumentality of any of the
        foregoing; (ii) any organization (other than a farmer’s cooperative as defined
        in section 521 of the Code) that is exempt from federal income taxation
        (including taxation under the unrelated business taxable income provisions
        of
        the Code); (iii) any rural telephone or electrical service cooperative described
        in section 1381(a)(2)(C) of the Code; or (iv) any other entity so designated
        by
        Treasury rulings or regulations promulgated or otherwise in effect as of
        the
        date hereof. In addition, a corporation will not be treated as an
        instrumentality of the United States or of any state or political subdivision
        thereof if all its activities are subject to tax and, with the exception
        of the
        Federal Home Loan Mortgage Corporation, a majority of its board of directors
        is
        not selected by such governmental unit.

       

      
        
          
          

        

        
          E-1

          
            

          

        

        
          
          

        

      

      5. The
        Transferee agrees to consent to any amendment of the Pooling and Servicing
        Agreement that shall be deemed necessary by Saxon (upon the advice of counsel
        to
        Saxon) to constitute a reasonable arrangement to ensure that no interest
        in a
        Residual Certificate will be owned directly or indirectly by a Disqualified
        Organization. 

       

      6. The
        Transferee acknowledges that Section 860E(e) of the Code would impose a
        substantial tax on the transferor or, in certain circumstances, on an agent
        for
        the Transferee, with respect to any transfer of any interest in any Residual
        Certificate to a Disqualified Organization. 

       

      Capitalized
        terms used and not otherwise defined herein shall have the meanings assigned
        to
        them in the Pooling and Servicing Agreement, dated as of February 1, 2007,
        by
        and among Saxon Asset Securities Company, the Servicer and the Trustee.

       

      IN
        WITNESS WHEREOF, the undersigned has caused this instrument to be executed
        by
        its duly authorized representative as of the [__] day of
        [                
] 200[  ]. 

       

      [NAME
        OF
        TRANSFEROR/TRANSFEREE]

      

      By:
        ______________________

      

      Name:
        ____________________

      

      Title:
        _____________________

      

      Personally
        appeared before me [_____________________], known or proved to me to be the
        same
        person who executed the foregoing instrument and to be a [____________________]
        of the Transferee, and acknowledged to me that he or she executed the same
        as
        his or her free act and deed and as the free act and deed of the Transferee.
        

       

      Subscribed
        and sworn before me this [__] day of
        [               
 ] 200[  ]. 

       

      Notary
        Public

      

      My
        commission expires the [____] day of [________] 200[__].

      

      
        
          
          

        

        
          E-2

          
            

          

        

        
          
          

        

      

      EXHIBIT
        F

       

      FORM
        OF TRANSFEROR CERTIFICATE

       

      [date]

       

      Saxon
        Asset Securities Company

      4860
        Cox
        Road

      Glen
        Allen, Virginia 23060

       

      Deutsche
        Bank National Trust Company 

      1761
        E. St. Andrews Place

      Santa
        Ana, California 92705

       

      
        	 	
                Re:
                  

              	
                Saxon
                  Asset Securities Trust 2007-1, 

              

      

      Mortgage
        Loan Pass-Through Certificates, Series 2007-1  

       

      Ladies
        and Gentlemen:

       

      In
        connection with our disposition of the above Certificates we certify that
        (a) we
        have not offered or sold any Certificates to, or solicited offers to buy
        any
        Certificates from, any person, or otherwise approached or negotiated with
        any
        person with respect thereto, in a manner that would be deemed, or taken any
        other action which would result in, a violation of Section 5 of the Act,
        (b) to
        the extent we are disposing of a Class ___ Certificate, we have no knowledge
        the
        Transferee is not a Permitted Transferee and (c) no purpose of the proposed
        disposition of a Class ___ Certificate is to impede the assessment or collection
        of tax.

       

      Very
        truly yours,

       

      [NAME
        OF
        TRANSFEROR]

       

      By:
        ______________________________

      

       

      

       

      
        
          
          

        

        
          F-1

          
            

          

        

        
          
          

        

      

      EXHIBIT
        G-1

       

      FORM
        OF INVESTMENT LETTER [NON-RULE 144A]

       

      [date]

       

      

      Saxon
        Asset Securities Company

      4860
        Cox
        Road

      Glen
        Allen, Virginia 23060

       

      Deutsche
        Bank National Trust Company 

      1761
        E. St. Andrew Place

      Santa
        Ana, California 92705

       

      
        	 	
                Re:

              	
                Saxon
                  Asset Securities Trust 2007-1, 

                Mortgage
                  Loan Pass-Through Certificates, Series
                  2007-1 

              

      

       

      Ladies
        and Gentlemen:

       

      In
        connection with our acquisition of the above-captioned Certificates, we certify
        that (a) we understand that the Certificates are not being registered under
        the
        Securities Act of 1933, as amended (the “Act”), or any state securities laws and
        are being transferred to us in a transaction that is exempt from the
        registration requirements of the Act and any such laws, (b) we are an
“accredited investor”, as defined in Regulation D under the Act, and have such
        knowledge and experience in financial and business matters that we are capable
        of evaluating the merits and risks of investments in the Certificates, (c)
        we
        have had the opportunity to ask questions of and receive answers from the
        Depositor concerning the purchase of the Certificates and all matters relating
        thereto or any additional information deemed necessary to our decision to
        purchase the Certificates, (d) we are not an employee benefit plan that is
        subject to the Employee Retirement Income Security Act of 1974, as amended,
        or a
        plan that is subject to Section 4975 of the Internal Revenue Code of 1986,
        as
        amended, nor are we acting on behalf of any such plan or using the assets
        of any
        such plan or arrangement, (e) we are acquiring the Certificates for investment
        for our own account and not with a view to any distribution of such Certificates
        (but without prejudice to our right at all times to sell or otherwise dispose
        of
        the Certificates in accordance with clause (g) below), (f) we have not offered
        or sold any Certificates to, or solicited offers to buy any Certificates
        from,
        any person, or otherwise approached or negotiated with any person with respect
        thereto, or taken any other action which would result in a violation of Section
        5 of the Act, and (g) we will not sell, transfer or otherwise dispose of
        any
        Certificates unless (1) such sale, transfer or other disposition is made
        pursuant to an effective registration statement under the Act or is exempt
        from
        such registration requirements, and if requested, we will at our expense
        provide
        an opinion of counsel satisfactory to the addressees of this Certificate
        that
        such sale, transfer or other disposition may be made pursuant
        to an exemption from the Act, (2) the purchaser or transferee of such
        Certificate has executed and delivered to you a certificate to substantially
        the
        same effect as this certificate, and (3) the purchaser or transferee has
        otherwise complied with any conditions for transfer set forth in the Pooling
        and
        Servicing Agreement.

      
        
          
          

        

        
          G-1-1

          
            

          

        

        
          
          

        

      

       

      Very
        truly yours,

       

      [NAME
        OF TRANSFEREE]

       

      By:
        ________________________________

      Authorized
        Officer

      

      

      

      
        
          
          

        

        
          G-1-2

          
            

          

        

        
          
          

        

      

      EXHIBIT
        G-2

       

      BENEFIT
        PLAN AFFIDAVIT

      

      
        	 	
                Re:

              	
                [Trust
                  Information] ERISA-Restricted Certificates and ERISA-Restricted
                  Swap
                  Certificates 

              

      

      

      
        	
                STATE
                  OF [_________]

              	
                )
                  

              
	 	
                )ss:

              
	
                COUNTY/CITY
                  OF [_______]

              	
                )

              

      

      

      

      Under
        penalties of perjury, I, the undersigned, declare that, to the best of my
        knowledge and belief, the following representations are true, correct, and
        complete.

       

      1. That
        I am
        a duly authorized officer of [Organization], a [State] corporation (the
“Purchaser”), whose taxpayer identification number is [____________], and on
        behalf of which I have the authority to make this affidavit.

      

      2. In
        the
        case of an ERISA-Restricted Certificate, the Purchaser either (x) is not,
        and on
        __________________ [date of transfer] will not be, an employee benefit plan
        or
        other retirement arrangement subject to Section 406 of the Employee Retirement
        Income Security Act of 1974, as amended (“ERISA”), or Section 4975 of the
        Internal Revenue Code of 1986, as amended (the “Code”), (collectively, a “Plan”)
        or a person acting on behalf of any such Plan or investing the assets of
        any
        such Plan to acquire a Certificate; (y) if the Certificate has been the subject
        of an ERISA-Qualifying Underwriting, is an insurance company that is purchasing
        the Certificate with funds contained in an “insurance company general account”
as defined in Section V(e) of Prohibited Transaction Class Exemption (“PTCE”)
        95-60 and the purchase and holding of the Certificate are covered under Sections
        I and III of PTCE 95-60; or (z) herewith delivers to the Trustee an opinion
        of
        counsel (a “Benefit Plan Opinion”) satisfactory to the Trustee, and upon which
        the Trustee, the Servicer and the Depositor shall be entitled to rely, to
        the
        effect that the purchase or holding of such Certificate by the Investor will
        not
        result in any non-exempt prohibited transactions under Title I of ERISA or
        Section 4975 of the Code and will not subject the Trustee, the Depositor,
        the
        Servicer or any NIMS Insurer to any obligation in addition to those undertaken
        by such entities in the Pooling and Servicing Agreement, which opinion of
        counsel shall not be an expense of the Trust Fund or any of the above
        parties.

       

      4.
         In
        the
        case of an ERISA-Restricted Swap Certificate prior to the termination of
        the
        Swap Agreement, either (i) the Purchaser is neither a Plan nor a person acting
        on behalf of any such Plan or using the assets of any such Plan to effect
        such
        transfer or (ii) the acquisition and holding of the ERISA-Restricted Swap
        Certificate are eligible for exemptive relief under PTCE 84-14, PTCE 90-1,
        PTCE
        91-38, PTCE 95-60 or PTCE 96-23.

       

      Capitalized
        terms used but not otherwise defined herein shall have the meanings assigned
        to
        such terms in the Pooling and Servicing Agreement, dated as of [__________],
        among [__________________].

       

      
        
          
          

        

        
          G-2-1

          
            

          

        

        
          
          

        

      

      [NAME
        OF
        PURCHASER]

       

      

       

      By: 
        ________________________________
[TITLE]

       

      

       

      
        
          
          

        

        
          G-2-2

          
            

          

        

        
          
          

        

      

      EXHIBIT
        H

       

      FORM
        OF RULE 144A AGREEMENT-QIB
        CERTIFICATION 

      SAXON
        ASSET SECURITIES COMPANY

      MORTGAGE
        LOAN ASSET BACKED CERTIFICATES, SERIES 2007-1, CLASS _

       

       

      [date]

       

      Deutsche
        Bank National Trust Company, as Trustee

      1761
        East
        St. Andrew Place

      Santa
        Ana, California 92705

      Attention:
        Alice D. Tatusian

       

      Deutsche
        Bank National Trust Company, as Certificate Registrar

      1761
        East
        St. Andrew Place

      Santa
        Ana, California 92705

      Attention:
        Alice D. Tatusian 

      

      Saxon
        Mortgage Services, Inc.

      4708
        Mercantile Drive

      Fort
        Worth, Texas 76137 

      Attention:
        President

      

      Saxon
        Asset Securities Company, as Depositor

      4860
        Cox
        Road

      Glen
        Allen, Virginia 23060

      Attention:
        Ernie Bretana

       

      Ladies
        and Gentlemen:

       

      In
        connection with the purchase on the date hereof of the captioned Certificates
        (the “Purchased Certificates”), the undersigned (the “Transferee”) hereby
        certifies and covenants to the transferor, Saxon, the Servicer, the Certificate
        Registrar, the Trustee and the Trust as follows:

       

      
        	
                1.

              	
                The
                  Transferee is a “qualified institutional buyer” as that term is defined in
                  Rule 144A (“Rule 144A”) promulgated under the Securities Act of 1933, as
                  amended (the “Securities Act”) and has completed the form of certification
                  to that effect attached hereto as Annex A. The Transferee is aware
                  that
                  the sale to it is being made in reliance on Rule
                  144A.

              

      

       

      
        	
                2.

              	
                The
                  Transferee understands that the Purchased Certificates have not
                  been
                  registered under the Securities Act or registered or qualified
                  under any
                  state securities laws and that no transfer may be made unless the
                  Purchased Certificates are registered under the Securities Act
                  and under
                  applicable state law or unless an exemption from such registration
                  is
                  available. The Transferee further understands that neither Saxon,
                  the
                  Servicer, the Certificate Registrar, the Paying Agent, the Calculation
                  Agent, the Trustee nor the Trust is under any obligation to register
                  the
                  Purchased Certificates or make an exemption from such registration
                  available.

              

      

       

      
        
          
          

        

        
          H-1

          
            

          

        

        
          
          

        

      

      
        	
                3.

              	
                The
                  Transferee is acquiring the Purchased Certificates for its own
                  account or
                  for the account of a “qualified institutional buyer,” and understands that
                  such Purchased Certificates may be resold, pledged or transferred
                  only (a)
                  to a person reasonably believed to be such a qualified institutional
                  buyer
                  that purchases for its own account or for the account of a qualified
                  institutional buyer to whom notice is given that the resale, pledge
                  or
                  transfer is being made in reliance on Rule 144A, or (b) pursuant
                  to
                  another exemption from registration under the Securities Act and
                  under
                  applicable state securities laws. In addition, such transfer may
                  be
                  subject to additional restrictions, as set forth in Section 5.2
                  of the
                  Pooling and Servicing Agreement.

              

      

       

      
        	
                4.

              	
                The
                  Transferee has been furnished with all information that it requested
                  regarding (a) the Purchased Certificates and distributions thereon
                  and (b)
                  the Pooling and Servicing Agreement referred to
                  below.

              

      

       

      
        	
                5.

              	
                If
                  applicable, the Transferee has complied or will comply in all material
                  respects with applicable regulatory guidelines relating to the
                  ownership
                  of mortgage derivative products.

              

      

       

      All
        capitalized terms used but not otherwise defined herein have the respective
        meanings assigned thereto in the Pooling and Servicing Agreement, dated as
        of
        February 1, 2007, by and among Saxon Asset Securities Company, the Servicer,
        the
        Certificate Registrar and the Trustee, pursuant to which the Purchased
        Certificates were issued.

       

      IN
        WITNESS WHEREOF, the undersigned has caused this Rule 144A Agreement—QIB
        Certification to be executed by a duly authorized representative this [__]
        day
        of [ ] 200[ ].

       

      [NAME
        OF TRANSFEREE]

       

       

      By:______________________________

      Title:____________________________

       

      
        
          
          

        

        
          H-2

          
            

          

        

        
          
          

        

      

      EXHIBIT
        I

       

      REQUEST
        FOR RELEASE OF DOCUMENTS AND RECEIPT

       

      __________________

      Date

       

      [Addressed
        to Trustee

      or,
        if
        applicable, custodian]

       

      In
        connection with the administration of the mortgages held by you as Trustee
        under
        a certain Pooling and Servicing Agreement, dated as of February 1, 2007,
        among
        Saxon Asset Securities Company, as Depositor, Saxon Mortgage Services, Inc.,
        as
        Servicer, and you, as Trustee (the “Pooling and Servicing Agreement”), the
        undersigned Servicer hereby requests a release of the Mortgage File held
        by you
        as Trustee with respect to the following described Mortgage Loan for the
        reason
        indicated below.

       

      Mortgagor’s
        Name:

       

      Address:

       

      Loan
        No.:

       

      Reason
        for requesting file:

       

      1. Mortgage
        Loan paid in full. (The Servicer hereby certifies that all amounts received
        in
        connection with the loan have been or will be credited to the Collection
        Account
        pursuant to the Pooling and Servicing Agreement.)

       

      2. The
        Mortgage Loan is being foreclosed.

       

      3. Mortgage
        Loan substituted. (The Servicer hereby certifies that a Qualifying Substitute
        Mortgage Loan has been assigned and delivered to you along with the related
        Mortgage File pursuant to the Pooling and Servicing Agreement.)

       

      4. Mortgage
        Loan repurchased. (The Servicer hereby certifies that the Purchase Price
        has
        been credited to the Collection Account pursuant to the Pooling and Servicing
        Agreement.)

       

      5. Other.
        (Describe)

       

      6. California
        Mortgage Loan expected to be paid in full.

       

      The
        undersigned acknowledges that the above Mortgage File will be held by the
        undersigned in accordance with the provisions of the Pooling and Servicing
        Agreement and will be returned to you within 10 days of our receipt of the
        Mortgage File, except if the Mortgage Loan has been paid in full, or repurchased
        or substituted for a Qualifying Substitute Mortgage Loan (in which case the
        Mortgage File will be retained by us permanently) and except if the Mortgage
        Loan is being foreclosed or is a California Mortgage Loan specified in #6
        above
        (in which case the Mortgage File will be returned when no longer required
        by us
        for such purpose).

       

      
        
          
          

        

        
          I-1

          
            

          

        

        
          
          

        

      

      Capitalized
        terms used herein shall have the meanings ascribed to them in the Pooling
        and
        Servicing Agreement.

       

      _____________________________________

      [Name
        of
        Servicer]

       

      By: 
        __________________________________

      Name:

      Title:
        Servicing Officer

       

      
        
          
          

        

        
          I-2

          
            

          

        

        
          
          

        

      

      EXHIBIT
        J

       

      [RESERVED]

       

      
        
          
          

        

        
          J-1

          
            

          

        

        
          
          

        

      

      EXHIBIT
        K

       

      FORM
        OF REMITTANCE AGENCY AGREEMENT

       

      This
        Remittance Agency Agreement, dated as of June ____,
        2006,
        is made by and among, Saxon Asset Securities Company, as buyer (the
“Counterparty”), Saxon Asset Securities Company (“SAXON”) and Deutsche Bank
        National Trust Company (the “Remittance Agent”).

       

      The
        Counterparty hereby appoints the Remittance Agent, and the Remittance Agent
        hereby accepts its appointment as agent of the Counterparty in connection
        with
        the receipt of $[  ]
        (the
“Remitted Amount”) in connection with the sale of mortgage-backed securities by
        Saxon Asset Securities Trust, Series 2007-1 in immediately available funds
        on
        the date hereof. The Counterparty delivers herewith to the Remittance Agent,
        in
        escrow pending wire transfer of the Remitted Amount as provided herein, a
        security release certification (the “Security Release Certification”)
        referencing the above-mentioned Saxon Asset Securities Trust, Series 2007-1.
        Upon receipt by the Remittance Agent of the Remitted Amount on the
        Counterparty’s behalf, the Counterparty hereby authorizes the Remittance Agent
        to release the Counterparty’s right, title, interest or claim of any kind with
        respect to the Mortgage Loans and the related collateral and assets identified
        in the Security Release Certification by delivering the Security Release
        Certification to SAXON and such other parties as SAXON may
        designate.

       

      The
        Remittance Agent shall wire the Remitted Amounts promptly as reasonably possible
        pursuant to the Counterparty’s wiring instructions set forth below:

       

      [                                 ]

      

      Bank:  [                   ]

      ABA:  [                   ]

      Acct:   [                   ] 

      Re:  Saxon Mortgage Services, Inc.

      Attn:   [                   ]

      

      In
        no
        event shall the Remitted Amount be remitted to SAXON, Saxon Mortgage Services,
        Inc. or any party other than the Counterparty.

       

      The
        parties agree that if for reasons not arising from the Remittance Agent’s
        negligence or willful misconduct, the Remittance Agent is unable to wire
        the
        Remitted Amount, then the Remittance Agent shall incur no liability for any
        reasonable delay; provided
        that the
        Remittance Agent shall make commercially reasonable efforts to invest such
        funds
        on the Counterparty’s behalf, and shall remit the Remitted Amount together with
        any investment earnings thereof as soon as possible thereafter, and in any
        event, within 1 Business Day.

       

      In
        consideration of the execution and delivery of this Remittance Agency Agreement
        by the Counterparty, SAXON hereby represents and warrants to the Counterparty
        that the Remitted Amount includes the total amount to which the Counterparty
        is
        entitled to receive pursuant to the terms of any and all existing agreements
        between the Counterparty and SAXON prior to delivering the release set forth
        in
        the Security Release Certification (such total amount, the “Required Amount”).
        In the event that upon final audit by the Counterparty the Remitted Amount
        is
        determined to be less than the Required Amount, SAXON shall pay the difference
        between the Remitted Amount and the Required Amount to the Counterparty in
        immediately available funds within two Business Days following notice
        thereof.

       

      
        
          
          

        

        
          K-1

          
            

          

        

        
          
          

        

      

      IN
        WITNESS WHEREOF, the Remittance Agent, the Counterparty and SAXON have caused
        this Remittance Agency Agreement to be executed and delivered by its duly
        authorized officer as of the date first set forth above.

       

      DEUTSCHE
        BANK NATIONAL TRUST 
COMPANY, as Remittance Agent

       

      By____________________________

      Name:_________________________

      Title:__________________________

      Telephone:
        _____________________

       

      By____________________________

      Name:_________________________

      Title:__________________________

      Telephone:
        _____________________

       

      

       

      [                                                           ]
as
        Counterparty

       

      By____________________________

      Name:_________________________

      Title:__________________________

      Telephone:
        _____________________

       

      

       

      SAXON
        ASSET SECURITIES COMPANY

       

      By____________________________

      Name:
        _________________________

      Title:
        __________________________

      Telephone:
        _____________________

       

      
        
          
          

        

        
          K-2

          
            

          

        

        
          
          

        

      

      EXHIBIT
        L

       

      FORM
        OF SECURITY RELEASE CERTIFICATION

       

      Definitions.
        As used
        in this Security Release Certification, the term “Remittance Agency Agreement”
shall mean the Remittance Agency Agreement, dated as of June ___,
        2006,
        among the undersigned financial institution (the “Counterparty”), Saxon Asset
        Securities Company (“SAXON”), and Deutsche Bank National Trust Company (the
“Remittance Agent”) relating to Saxon Asset Securities Trust 2007-1. The term
“Pooling and Servicing Agreement” shall mean the Pooling and Servicing Agreement
        among Saxon Asset Securities Company (“Saxon”), Saxon Mortgage Services, Inc.
        (“Saxon”), as Servicer, and the Trustee named therein relating to the said Saxon
        Asset Securities Trust.

       

      Release.
        Simultaneously with receipt by wire transfer of the Remitted Amount as defined
        in the Remittance Agency Agreement, the Counterparty hereby, without further
        act, releases any and all right, title, interest, or security interest in
        the
        Mortgage Loans identified in the Pooling and Servicing Agreement, together
        with
        all of the Counterparty’s rights and interests in and to the related loan files,
        rights, assets of any kind, and proceeds thereof, related to the Mortgage
        Loans.
        Until payment for such Mortgage Loans is received by the Remittance Agent,
        the
        Counterparty’s aforesaid ownership interest therein will remain in full force
        and effect.

       

      The
        Counterparty agrees that upon receipt by the Remittance Agent of the Remitted
        Amount it shall execute and deliver to SFM and such other parties as SFM
        may
        designate such further release documents, and file with the appropriate filing
        officials, as required, any and all documents appropriate to further evidence
        such release and to reflect such release in appropriate public records.

       

      IN
        WITNESS WHEREOF, the Counterparty has caused this Security Release Certification
        to be executed and delivered by its duly authorized officer as of the date
        first
        set forth above.

       

      [                                                          ]

       

      By:____________________________________

      Name:__________________________________

      Title:
        ___________________________________

      Telephone:______________________________

      

      

      
        
          
          

        

        
          L-1

          
            

          

        

        
          
          

        

      

      EXHIBIT
        M-1

       

      RESERVED

       

      

       

      
        
          
          

        

        
          M-1-1

          
            

          

        

        
          
          

        

      

      EXHIBIT
        M-2

       

      RESERVED

      
        
          
          

        

        
          M-2-1

          
            

          

        

        
          
          

        

      

      EXHIBIT
        N

       

      [RESERVED]

      

      

       

      
        
          
          

        

        
          N-1

          
            

          

        

        
          
          

        

      

      EXHIBIT
        O

       

      FORM
        CERTIFICATION TO BE PROVIDED 

      TO
        THE DEPOSITOR BY THE TRUSTEE

      

      

      Re:
        Saxon
        Asset Securities Trust 2007-1

      

      I,
        [identify the certifying individual], a [title] of Deutsche Bank National
        Trust
        Company, as Trustee, hereby certify to Saxon Asset Securities Company (the
        “Depositor”), and its officers, directors and affiliates, and with the knowledge
        and intent that they will reply upon this certification that:

      

      1. [I
        have
        reviewed the annual report on Form 10-K (including the exhibits provided
        by the
        Depositor to the Trustee for attachment thereto) for the fiscal year [____],
        and
        all reports on Form 10-D containing distribution reports filed in respect
        of
        periods included in the year covered by that annual report, of the Depositor,
        relating to the above-referenced trust;]

       

      2. [Based
        on
        my actual knowledge, without independent investigation or inquiry, the
        information provided by the Servicer in these distribution reports prepared
        by
        the Trustee, taken as a whole, does not contain any untrue statement of a
        material fact or omit to state a material fact necessary to make the statements
        made, in light of the circumstances under which such statements were made
        not
        misleading as of the last day of the period covered by that annual report;
        and]

       

      3. [Based
        on
        my knowledge, the distribution information required to be provided by the
        trustee under the pooling and servicing agreement is included in these
        distribution reports.]

       

      

      Date:  
        _________________________________
Deutsche
        Bank National Trust Company,
as
        Trustee

       

      By:     
        ____________________________________
[Signature]
[Title]

      

      
        
          
          

        

        
          O-1

          
            

          

        

        
          
          

        

      

      EXHIBIT
        P

      

      FORM
        CERTIFICATION TO BE 

      PROVIDED
        TO THE DEPOSITOR BY THE SERVICER

      

      

      Re:
        Saxon
        Asset Securities Trust 2007-1

      

      I,
        [identify the certifying individual], certify to Saxon Asset Securities Company
        (the “Depositor”), and its officers, directors and affiliates, and with the
        knowledge and intent that they will rely upon this certification,
        that:

      

      1. [I
        have
        reviewed the servicing reports contained in the annual report on Form 10-K
        for
        the fiscal year [___], and the servicing reports contained in all reports
        on
        Form 10-D containing such reports filed in respect of periods included in
        the
        year covered by that annual report, of the Depositor relating to the
        above-referenced trust;]

       

      2. [Based
        on
        my knowledge, the information in these reports, taken as a whole, does not
        contain any untrue statement of a material fact or omit to state a material
        fact
        necessary to make the statements made in light of the circumstances under
        which
        such statements were made, not misleading as of the last day of the period
        covered by that annual report;]

       

      3. [Based
        on
        my knowledge, the servicing information required to be provided to the trustee
        by the servicer under the pooling and servicing agreement is included in
        these
        reports;]

       

      4. [I
        am
        responsible for reviewing the activities performed by the servicer under
        the
        pooling and servicing agreement and based upon the review required under
        the
        pooling and servicing agreement, and except as disclosed in the report, the
        servicer has fulfilled its obligations under the pooling and servicing
        agreement; and]

       

      5. [I
        have
        disclosed to the Depositor’s certified public accountants all significant
        deficiencies relating to the servicer’s compliance with the minimum servicing
        standards in accordance with a review conducted in compliance with the Uniform
        Single Attestation Program for Mortgage Bankers or similar standard as set
        forth
        in the pooling and servicing agreement.]

       

      

      _____________________________

      _____________________________

      [Signature]

      [Title]

      Date:

      

      
        
          
          

        

        
          P-1

          
            

          

        

        
          
          

        

      

      EXHIBIT
        Q

      

      INTEREST
        RATE SWAP AGREEMENT

      

      
        
          
          

        

        
          Q-1

          
            

          

        

        
          
          

        

      

      EXHIBIT
        R

      

      INTEREST
        RATE CAP AGREEMENT

      

      
        
          
          

        

        
          R-1

          
            

          

        

        
          
          

        

      

      EXHIBIT
        S

      

      FORM
        10-D, FORM 8-K AND FORM 10-K

      REPORTING
        RESPONSIBILITY

      

      As
        to
        each item described below, the entity indicated as the Responsible Entity
        shall
        be primarily responsible for reporting the information to the Trustee pursuant
        to Section 8.13(b). If the Trustee is indicated below as the Responsible
        Entity
        as to any item, then the Trustee is primarily responsible for obtaining that
        information.

      

      Under
        Item 1 of Form 10-D: a) items marked “4.5 statement” are required to be included
        in the periodic Distribution Date statement under Section 4.5 of the Pooling
        and
        Servicing Agreement, provided by the Trustee based on information received
        from
        the Servicer; and b) items marked “Form 10-D report” are required to be in the
        Form 10-D report but not the 4.5 statement, provided by the party indicated.
        Information under all other Items of Form 10-D is to be included in the Form
        10-D report.

      

        
          	
                  Form

                   

                	 	
                  Item

                   

                	 	
                  Description

                   

                	 	
                  Responsible
                    Entity

                   

                
	
                  10-D

                   

                	 	
                  1

                   

                	 	
                  Distribution
                    and Pool Performance Information

                   

                	 	 
	 	 	 	 	
                  Item
                    1121(a) - Distribution and Pool Performance Information

                   

                	 	 
	 	 	 	 	
                  (1)    Any
                    applicable record dates, accrual dates, determination dates for
                    calculating payments and actual payment dates for the payment
                    period.

                   

                	 	
                  4.5
                    statement

                   

                
	 	 	 	 	
                  (2)    Cash
                    flows received and the sources thereof for payments, fees and
                    expenses.

                   

                	 	
                  4.5
                    statement

                   

                
	 	 	 	 	
                  (3)    Calculated
                    amounts and distribution of the flow of funds for the period
                    itemized by
                    type and priority of payment, including:

                   

                	 	
                  4.5
                    statement

                   

                
	 	 	 	 	
                  (i) Fees
                    or expenses accrued and paid, with an identification of the general
                    purpose of such fees and the party receiving such fees or
                    expenses.

                   

                	 	
                  4.5
                    statement

                   

                
	 	 	 	 	
                  (ii) Payments
                    accrued or paid with respect to enhancement or other support
                    identified in
                    Item 1114 of Regulation AB (such as insurance premiums or other
                    enhancement maintenance fees), with an identification of the
                    general
                    purpose of such payments and the party receiving such
                    payments.

                   

                	 	
                  4.5
                    statement

                   

                
	 	 	 	 	
                  (iii) Principal,
                    interest and other payments accrued and paid on the asset-backed
                    securities by type and by class or series and any principal or
                    interest
                    shortfalls or carryovers.

                   

                	 	
                  4.5
                    statement

                   

                

        

         

        
          
            
            

          

          
            S-1

            
              

            

          

          
            
            

          

        

         

        
          	 	 	 	 	
                  (iv) The
                    amount of excess cash flow or excess spread and the disposition
                    of excess
                    cash flow.

                   

                	 	
                  4.5
                    statement

                   

                
	 	 	 	 	
                  (4)    Beginning
                    and ending principal balances of the asset-backed securities.

                   

                	 	
                  4.5
                    statement

                   

                
	 	 	 	 	
                  (5)    Interest
                    rates applicable to the pool assets and the asset-backed securities,
                    as
                    applicable. Consider providing interest rate information for
                    pool assets
                    in appropriate distributional groups or incremental ranges.

                   

                	 	
                  4.5
                    statement

                   

                
	 	 	 	 	
                  (6)    Beginning
                    and ending balances of transaction accounts, such as reserve
                    accounts, and
                    material account activity during the period.

                   

                	 	
                  4.5
                    statement

                   

                
	 	 	 	 	
                  (7)    Any
                    amounts drawn on any credit enhancement or other support identified
                    in
                    Item 1114 of Regulation AB, as applicable, and the amount of
                    coverage
                    remaining under any such enhancement, if known and
                    applicable.

                   

                	 	
                  4.5
                    statement

                   

                
	 	 	 	 	
                  (8)    Number
                    and amount of pool assets at the beginning and ending of each
                    period, and
                    updated pool composition information, such as weighted average
                    coupon,
                    weighted average life, weighted average remaining term, pool
                    factors and
                    prepayment amounts.

                   

                	 	
                  4.5
                    statement

                   

                   

                   

                  Updated
                    pool composition information filed to be as specified by Depositor
                    or
                    Servicer from time to time.

                   

                
	 	 	 	 	
                  (9)    Delinquency
                    and loss information for the period.

                   

                   

                   

                  In
                    addition, describe any material changes to the information specified
                    in
                    Item 1100(b)(5) of Regulation AB regarding the pool assets.

                   

                	 	
                  4.5
                    statement

                   

                   

                   

                  Form
                    10-D report; Depositor or Servicer

                   

                
	 	 	 	 	
                  (10)        
                    Information
                    on the amount, terms and general purpose of any advances made
                    or
                    reimbursed during the period, including the general use of funds
                    advanced
                    and the general source of funds for reimbursements.

                   

                	 	
                  4.5
                    statement

                   

                

        

         

        
          
            
            

          

          
            S-2

            
              

            

          

          
            
            

          

        

         

        
          	 	 	 	 	
                  (11)        
                    Any
                    material modifications, extensions or waivers to pool asset terms,
                    fees,
                    penalties or payments during the distribution period or that
                    have
                    cumulatively become material over time.

                   

                	 	
                  Form
                    10-D report; Servicer

                   

                
	 	 	 	 	
                  (12)        
                    Material
                    breaches of pool asset representations or warranties or transaction
                    covenants.

                   

                	 	
                  Form
                    10-D report; Servicer

                   

                
	 	 	 	 	
                  (13)        
                    Information
                    on ratio, coverage or other tests used for determining any early
                    amortization, liquidation or other performance trigger and whether
                    the
                    trigger was met.

                   

                	 	
                  4.5
                    statement

                   

                
	 	 	 	 	
                  (14)        
                    Information
                    regarding any new issuance of asset-backed securities backed
                    by the same
                    asset pool, [information regarding] any pool asset changes (other
                    than in
                    connection with a pool asset converting into cash in accordance
                    with its
                    terms), such as additions or removals in connection with a prefunding
                    or
                    revolving period and pool asset substitutions and repurchases
                    (and
                    purchase rates, if applicable), and cash flows available for
                    future
                    purchases, such as the balances of any prefunding or revolving
                    accounts,
                    if applicable. Disclose any material changes in the solicitation,
                    credit-granting, underwriting, origination, acquisition or pool
                    selection
                    criteria or procedures, as applicable, used to originate, acquire
                    or
                    select the new pool assets.

                   

                	 	
                  Form
                    10-D report: Depositor, Servicer

                   

                
	 	 	
                  2

                   

                	 	
                  Legal
                    Proceedings

                   

                	 	 
	 	 	 	 	
                  Item
                    1117 - Legal proceedings pending against the following entities,
                    or their
                    respective property, that is material to Certificateholders,
                    including
                    proceedings known to be contemplated by governmental
                    authorities:

                   

                  Seller

                   

                  Depositor

                   

                  Trustee

                   

                  Issuing
                    entity

                   

                  Servicer

                   

                  Originator

                   

                  Custodian

                   

                	 	
                   

                   

                  Seller

                  Depositor

                  Trustee

                  Issuing
                    Entity

                  Servicer

                  Originator

                  Custodian

                   

                

        

         

        
          
            
            

          

          
            S-3

            
              

            

          

          
            
            

          

        

         

        
          	 	 	
                  3

                   

                	 	
                  Sales
                    of Securities and Use of Proceeds

                   

                	 	 
	 	 	 	 	
                  Information
                    from Item 2(a) of Part II of Form 10-Q:

                   

                   

                   

                  With
                    respect to any sale of securities by the sponsor, depositor or
                    issuing
                    entity, that are backed by the same asset pool or are otherwise
                    issued by
                    the issuing entity, whether or not registered, provide the sales
                    and use
                    of proceeds information in Item 701 of Regulation S-K. Pricing
                    information
                    can be omitted if securities were not registered.

                   

                	 	
                   

                   

                   

                   

                  Depositor
                    or Servicer

                   

                
	 	 	
                  4

                   

                	 	
                  Defaults
                    Upon Senior Securities

                   

                	 	 
	 	 	 	 	
                  Information
                    form Item 3 of Part II of Form 10-Q:

                   

                   

                   

                  Report
                    the occurrence of any Event of Default (after expiration of any
                    grace
                    period and provision of any required notice)

                   

                	 	
                   

                   

                   

                   

                  N/A

                   

                
	 	 	
                  5

                   

                	 	
                  Submission
                    of Matters to a Vote of Security Holders

                   

                	 	 
	 	 	 	 	
                  Information
                    from Item 4 of Part II of Form 10-Q

                   

                	 	
                  Trustee

                   

                
	 	 	
                  6

                   

                	 	
                  Significant
                    Obligors of Pool Assets

                   

                	 	 
	 	 	 	 	
                  Item
                    1112(b) - Significant Obligor Financial Information*

                   

                   

                   

                  *This
                    information need only be reported on the Form 10-D for the distribution
                    period in which updated information is required pursuant to the
                    Item

                   

                	 	 
	 	 	
                  7

                   

                	 	
                  Significant
                    Enhancement Provider Information

                   

                	 	 
	 	 	 	 	
                  Item
                    1114(b)(2) - Credit Enhancement Provider Financial
                    Information*

                   

                  Determining
                    applicable disclosure threshold

                   

                  Obtaining
                    required financial information or effecting incorporation by
                    reference

                   

                	 	
                   

                  N/A

                   

                  N/A

                   

                

        

         

        
          
            
            

          

          
            S-4

            
              

            

          

          
            
            

          

        

         

        
          	 	 	 	 	
                  Item
                    1115(b) - Derivative Counterparty Financial Information*

                   

                  Determining
                    current maximum probable exposure

                   

                  Determining
                    current significance percentage

                   

                  Obtaining
                    required financial information or effecting incorporation by
                    reference

                   

                	 	
                   

                   

                  [TBD]

                   

                  [TBD]

                   

                  Depositor
                    

                   

                
	 	 	 	 	
                  *This
                    information need only be reported on the Form 10-D for the distribution
                    period in which updated information is required pursuant to the
                    Items.

                   

                	 	 
	 	 	
                  8

                   

                	 	
                  Other
                    Information

                   

                	 	 
	 	 	 	 	
                  Disclose
                    any information required to be reported on Form 8-K during the
                    period
                    covered by the Form 10-D but not reported

                   

                	 	
                  The
                    Responsible Entity for the applicable Form 8-K item as indicated
                    below

                   

                
	 	 	
                  9

                   

                	 	
                  Exhibits

                   

                	 	 
	 	 	 	 	
                  Distribution
                    report

                   

                	 	
                  Trustee

                   

                
	 	 	 	 	
                  Exhibits
                    required by Item 601 of Regulation S-K, such as material
                    agreements

                   

                	 	
                  Depositor

                   

                
	
                  8-K

                   

                	 	 	 	 	 	 
	 	 	
                  1.01

                   

                	 	
                  Entry
                    into a Material Definitive Agreement

                   

                	 	 
	 	 	 	 	
                  Disclosure
                    is required regarding entry into or amendment of any definitive
                    agreement
                    that is material to the securitization, even if depositor is
                    not a
                    party.

                   

                  Examples:
                    servicing agreement, custodial agreement

                   

                  Note:
                    disclosure not required as to definitive agreements that are
                    fully
                    disclosed in the prospectus

                   

                	 	
                  Depositor

                   

                

        

         

        
          
            
            

          

          
            S-5

            
              

            

          

          
            
            

          

        

         

        
          	 	 	
                  1.02

                   

                	 	
                  Termination
                    of a Material Definitive Agreement

                   

                	 	 
	 	 	 	 	
                  Disclosure
                    is required regarding termination of any definitive agreement
                    that is
                    material to the securitization (other than expiration in accordance
                    with
                    its terms), even if depositor is not a party. Examples: servicing
                    agreement, custodial agreement.

                   

                	 	
                  Depositor

                   

                
	 	 	
                  1.03

                   

                	 	
                  Bankruptcy
                    or Receivership

                   

                	 	 
	 	 	 	 	
                  Disclosure
                    is required regarding the bankruptcy or receivership, if known
                    to the
                    Depositor or Servicer or Trustee, with respect to any of the
                    following:

                   

                   

                   

                  Sponsor
                    (Seller), Depositor, Trustee, Swap Counterparty, Cap Counterparty,
                    Custodian

                   

                	 	
                  Depositor/Trustee

                   

                
	 	 	
                  2.04

                   

                	 	
                  Triggering
                    Events that Accelerate or Increase a Direct Financial Obligation
                    or an
                    Obligation under an Off-Balance Sheet Arrangement

                   

                	 	 
	 	 	 	 	
                  Includes
                    an early amortization, performance trigger or other event, including
                    event
                    of default, that would materially alter the payment priority/distribution
                    of cash flows/amortization schedule.

                   

                  Disclosure
                    will be made of events other than waterfall triggers which are
                    disclosed
                    in the 4.05 statement

                   

                	 	
                  N/A

                   

                
	 	 	
                  3.03

                   

                	 	
                  Material
                    Modification to Rights of Security Holders

                   

                	 	 
	 	 	 	 	
                  Disclosure
                    is required of any material modification to documents defining
                    the rights
                    of Certificateholders, including the Pooling and Servicing
                    Agreement

                   

                	 	
                  Party
                    requesting material modification

                   

                
	 	 	
                  5.03

                   

                	 	
                  Amendments
                    to Articles of Incorporation or Bylaws; Change in Fiscal
                    Year

                   

                	 	 

        

         

        
          
            
            

          

          
            S-6

            
              

            

          

          
            
            

          

        

         

        
          	 	 	 	 	
                  Disclosure
                    is required of any amendment “to the governing documents of the issuing
                    entity”

                   

                	 	
                  Depositor

                   

                
	 	 	
                  6.02

                   

                	 	
                  Change
                    of Servicer or Trustee

                   

                	 	 
	 	 	 	 	
                  Requires
                    disclosure of any removal, replacement, substitution or addition
                    of any
                    servicer, affiliated servicer, other servicer servicing 10% or
                    more of
                    pool assets at time of report, other material servicers, certificate
                    administrator or trustee. Reg AB disclosure about any new servicer
                    or
                    trustee is also required.

                   

                	 	
                  Trustee
                    or Servicer

                   

                
	 	 	
                  6.03

                   

                	 	
                  Change
                    in Credit Enhancement or Other External Support

                   

                	 	 
	 	 	 	 	
                  Covers
                    termination of any enhancement in manner other than by its terms,
                    the
                    addition of an enhancement, or a material change in the enhancement
                    provided. Applies to external credit enhancements as well as
                    derivatives.
                    Reg AB disclosure about any new enhancement provider is also
                    required.

                   

                	 	
                  Depositor
                    or Servicer

                   

                
	 	 	
                  6.04

                   

                	 	
                  Failure
                    to Make a Required Payment

                   

                	 	
                  Trustee

                   

                
	 	 	
                  6.05

                   

                	 	
                  Securities
                    Act Updating Disclosure

                   

                	 	 
	 	 	 	 	
                  If
                    any material pool characteristic differs by 5% or more at the
                    time of
                    issuance of the securities from the description in the final
                    prospectus,
                    provide updated Reg AB disclosure about the actual asset
                    pool.

                   

                	 	
                  Depositor
                    or Servicer

                   

                
	 	 	 	 	
                  If
                    there are any new servicers or originators required to be disclosed
                    under
                    Regulation AB as a result of the foregoing, provide the information
                    called
                    for in Items 1108 and 1110 respectively.

                   

                	 	
                  Depositor
                    or Servicer

                   

                
	 	 	
                  7.01

                   

                	 	
                  Regulation
                    FD Disclosure

                   

                	 	
                  Depositor
                    or Servicer

                   

                
	 	 	
                  8.01

                   

                	 	
                  Other
                    Events

                   

                	 	 
	 	 	 	 	
                  Any
                    event, with respect to which information is not otherwise called
                    for in
                    Form 8-K, that the registrant deems of importance to security
                    holders.

                   

                	 	
                  Depositor
                    or Servicer

                   

                

        

         

        
          
            
            

          

          
            S-7

            
              

            

          

          
            
            

          

        

         

        
          	 	 	
                  9.01

                   

                	 	
                  Financial
                    Statements and Exhibits

                   

                	 	
                  The
                    Responsible Entity applicable to reportable event

                   

                
	
                  10-K

                   

                	 	 	 	 	 	 
	 	 	
                  9B

                   

                	 	
                  Other
                    Information

                   

                	 	 
	 	 	 	 	
                  Disclose
                    any information required to be reported on Form 8-K during the
                    fourth
                    quarter covered by the Form 10-K but not reported

                   

                	 	
                  The
                    Responsible Entity for the applicable Form 8-K item as indicated
                    above

                   

                
	 	 	
                  15

                   

                	 	
                  Exhibits
                    and Financial Statement Schedules

                   

                	 	 
	 	 	 	 	
                  Item
                    1112(b) - Significant Obligor Financial Information

                   

                	 	
                  N/A

                   

                
	 	 	 	 	
                  Item
                    1114(b)(2) - Credit Enhancement Provider Financial
                    Information

                   

                  Determining
                    applicable disclosure threshold

                   

                  Obtaining
                    required financial information or effecting incorporation by
                    reference

                   

                	 	
                   

                   

                  N/A

                   

                  N/A

                   

                
	 	 	 	 	
                  Item
                    1115(b) - Derivative Counterparty

                   

                	 	 

        

      

      

      

        
          
            
            

          

          
            S-8

            
              

            

          

          
            
            

          

        

      EXHIBIT
        T

       

      SERVICING
        CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE

       

       

      The
        assessment of compliance to be delivered by the Trustee shall address, at
        a
        minimum, the criteria identified below:

      

        
          	
                   

                  Reference

                   

                	
                   

                  Servicing
                    Criteria

                   

                
	
                   

                  1122(d)(1)(i)

                   

                	
                   

                  Policies
                    and procedures are instituted to monitor any performance or other
                    triggers
                    and events of default in accordance with the transaction
                    agreements.

                   

                
	
                   

                  1122(d)(1)(ii)

                   

                	
                   

                  If
                    any material servicing activities are outsourced to third parties,
                    policies and procedures are instituted to monitor the third party's
                    performance and compliance with such servicing activities.

                   

                
	
                   

                  1122(d)(2)(ii)

                   

                	
                   

                  Disbursements
                    made via wire transfer on behalf of an obligor or to an investor
                    are made
                    only by authorized personnel.

                   

                
	
                   

                  1122(d)(2)(iv)

                   

                	
                   

                  The
                    related accounts for the transaction, such as cash reserve accounts
                    or
                    accounts established as a form of overcollateralization, are
                    separately
                    maintained (e.g. with respect to commingling of cash) as set
                    forth in the
                    transaction documents.

                   

                
	
                   

                  1122(d)(2)(v)

                   

                	
                   

                  Each
                    custodial account is maintained by a federally insured depository
                    institution as set forth in the transaction documents.

                   

                
	
                   

                  1122(d)(2)(vi)

                   

                	
                   

                  Unissued
                    checks are safeguarded so as to prevent unauthorized access.

                   

                
	
                   

                  1122(d)(2)(vii)

                   

                	
                   

                  Reconciliations
                    are prepared on a monthly basis for all asset-backed securities
                    related
                    bank accounts, including custodial accounts and related bank
                    clearing
                    accounts. These reconciliations are (A) mathematically accurate;
                    (B)
                    prepared within 30 calendar days after the bank statement cutoff
                    date, or
                    such other number of days specified in the transaction documents;
                    (C)
                    reviewed and approved by someone other than the person who prepared
                    the
                    reconciliation; and (D) contain explanations for reconciling
                    items. These
                    reconciling items are resolved within 90 calendar days of their
                    original
                    identification, or such other number of day specified in the
                    transaction
                    agreements.

                   

                

        

         

        
          
            
            

          

          
            T-1

            
              

            

          

          
            
            

          

        

         

        
          	
                   

                  1122(d)(3)(i)

                   

                	
                   

                  Reports
                    to investors, including those to be filed with the Commission,
                    are
                    maintained in accordance with the transaction agreements and
                    applicable
                    Commission requirements. Specifically, such reports (A) are prepared
                    in
                    accordance with timeframes and other terms set forth in the transaction
                    agreements; (B) provide information calculated in accordance
                    with the
                    terms specified in the transaction agreements; (C) are filed
                    with the
                    Commission as required by its rules and regulations and (D) agree
                    with
                    investors' or the trustee's records as to the total unpaid principal
                    balance and number of mortgage loans.

                   

                
	
                   

                  1122(d)(3)(ii)

                   

                	
                   

                  Amounts
                    due to investors are allocated and remitted in accordance with
                    the
                    timeframes, distribution priority and other terms set forth in
                    the
                    transaction agreements.

                   

                
	
                   

                  1122(d)(3)(iii)

                   

                	
                   

                  Disbursements
                    made to an investor are posted within two business days to the
                    servicer's
                    investor records, or such other number of days specified in the
                    transaction documents.

                   

                
	
                   

                  1122(d)(3)(iv)

                   

                	
                   

                  Amounts
                    remitted to investors per the investor reports agree with cancelled
                    checks, or other forms of payment, or custodial bank
                    statements.

                   

                
	
                   

                  1122(d)(4)(i)

                   

                	
                   

                  Collateral
                    or security on mortgage loans is maintained as required by the
                    transaction
                    agreements or related mortgage loan documents.

                   

                
	
                   

                  1122(d)(4)(ii)

                   

                	
                   

                  Mortgage
                    loan and related documents are safeguarded as required by the
                    transaction
                    agreements.

                   

                

        

         

        
          
            
            

          

          
            T-2

            
              

            

          

          
            
            

          

        

         

        
          	
                   

                  1122(d)(4)(iii)

                   

                	
                   

                  Any
                    additions, removals or substitutions to the asset pool are made,
                    reviewed
                    and approved in accordance with any conditions or requirements
                    in the
                    transaction agreements.

                   

                
	
                   

                  1122(d)(4)(xv)

                   

                	
                   

                  Any
                    external enhancement or other support, identified in Item 1114(a)(1)
                    through (3) or Item 1115 of Regulation AB, is maintained as set
                    forth in
                    the transaction agreements.

                   

                

        

      

       

      

       

      
        
          
          

        

        
          T-3Unassociated Document

    EXHIBIT
      4.1

    

     

    ______________________________________

    

    AMENDMENT
      NUMBER ONE

    to
      the

    MORTGAGE
      LOAN PURCHASE AGREEMENT

    dated
      as
      of February 15, 2007

    by
      and
      between

    ACE
      SECURITIES CORP.

    and

    DB
      STRUCTURED PRODUCTS, INC. 

    ______________________________________

    

     

    THIS
      AMENDMENT NUMBER ONE (this “Amendment Number One”) is made this 22nd
      day of
      March, 2007, by and between ACE SECURITIES CORP. (the “Purchaser”) and DB
      STRUCTURED PRODUCTS, INC. (the “Seller”),
      to the Mortgage Loan Purchase Agreement, dated as of February 15, 2007, by
      and
      between the Purchaser and the Seller (the “Agreement”).

     

    
      WITNESSETH

    

    

    WHEREAS,
      the Purchaser and the Seller desire to amend the Agreement, subject to the
      terms
      hereof, to modify the Agreement as specified herein; and 

     

    WHEREAS,
      the Purchaser and the Seller each have agreed to execute and deliver this
      Amendment Number One on the terms and conditions set forth herein.

    

    NOW
      THEREFORE, for good and valuable consideration, the receipt and sufficiency
      of
      which are hereby acknowledged, and of the mutual covenants herein contained,
      the
      parties hereto hereby agree as follows:

     

    SECTION
      1. Defined
      Terms.
      For
      purposes of this Amendment Number One, unless the context clearly requires
      otherwise, all capitalized terms which are used but not otherwise defined herein
      shall have the respective meanings assigned to such terms in the
      Agreement.

    

    SECTION
      2. The
      Amendments.
      

    

    (a)  Section
      6
      of the Agreement is hereby amended by: (i) deleting the word “and” at the end of
      subpart (lxxii) thereof and (ii) inserting the following new subpart at the
      end
      of subpart (lxxiii) thereof:

    

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

       

    

    ;
      and
      (lxxiv) With respect to any Group I Mortgage Loan for which the date of the
      related mortgage note is more than 1 year before the Closing Date, 

     

    (i) The
      Sponsor represents that it currently operates or actively participates in an
      on-going and active program or business (A) to originate mortgages, and/or
      (B)
      to make periodic purchases of mortgage loans from originators or other sellers,
      and/or (C) to issue and/or purchase securities or bonds supported by the
      mortgages, with a portion of the proceeds generated by such program or business
      being used to purchase or originate mortgages made to borrowers who
      are:

     

    (a)
      low-income families (families with incomes of 80% or less of area median income)
      living in low-income areas (a census tract or block numbering area in which
      the
      median income does not exceed 80 percent of the area median income)
      and/or

     

    (b)
      very
      low-income families (families with incomes of 60% or less of area median
      income), and

     

    (ii)
      The
      Sponsor agrees that Freddie Mac for a period of two (2) years following the
      date
      of this Agreement may contact the Sponsor to confirm that it continues to
      operate or actively participate in the mortgage program or business and to
      obtain other nonproprietary information about the Sponsor’s activities that may
      assist Freddie Mac in completing its regulatory reporting requirements. The
      Sponsor will make reasonable efforts to provide such information to Freddie
      Mac.

     

    

     

    SECTION
      3. Limited
      Effect.
      Except as amended hereby, the Agreement shall continue in full force and effect
      in accordance with its terms. Reference to this Amendment need not be made
      in
      the Agreement or any other instrument or document executed in connection
      therewith, or in any certificate, letter or communication issued or made
      pursuant to, or with respect to, the Agreement, any reference in any of such
      items to the Agreement being sufficient to refer to the Agreement as amended
      hereby. Except
      as
      modified and expressly amended by this Amendment Number One, the Agreement
      is in
      all respects ratified and confirmed, and all the terms, provisions and
      conditions thereof shall be and remain in full force and effect.

    

    SECTION
      4. Governing
      Law.
      This
      Amendment Number One shall be construed in accordance with the substantive
      laws
      of the State of New York (without regard to conflict of law principles other
      than Section 5-1401 of the New York General Obligations Law which shall govern)
      and the obligations, rights and remedies of the parties hereto shall be
      determined in accordance with such laws.

    

    SECTION
      5. Severability
      of Provisions.
      If any
      one or more of the provisions or terms of this Amendment Number One shall be
      for
      any reason whatsoever held invalid, then such provisions or terms shall be
      deemed severable from the remaining provisions or terms of this Amendment Number
      One and shall in no way affect the validity or enforceability of the other
      provisions or terms of this Amendment Number One.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

       

    

    SECTION
      6. Section
      Headings.
      The
      section headings herein are for convenience of reference only, and shall not
      limit or otherwise affect the meaning hereof.

     

    SECTION
      7. Counterparts.
      This
      Amendment Number One may be executed in several counterparts, each of which
      shall be an original and all of which shall constitute but one and the same
      instrument.

     

    

    [signature
      page follows]

    

    

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

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

    

    
      	
              ACE
                SECURITIES CORP.,

              as
                Purchaser

               

               

              By:/s/
                Evelyn Echevarria         

              Name:
                Evelyn Echevarria

              Title:
                Vice President

               

              By:
                /s/
                Doris J. Hearn          

              Name:
                Doris J. Hearn

              Title:
                Vice President

            	
              DB
                STRUCTURED PRODUCTS, INC.,

              as
                Seller

               

               

              By:
                /s/
                Rika Yano           

              Name:
                Rika Yano

              Title:
                Vice President

               

              By:
                /s/
                Susan Valenti           

              Name:
                Susan Valenti

              Title:
                Director

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