Document:

Sale and Servicing Agreement, dated August 1, 2005

 Exhibit 10.1 
 EXECUTION COPY 
  
 SALE AND
SERVICING AGREEMENT 
  
 dated as of August 1, 2005 
  
 by and among 
  
 ACCREDITED MORTGAGE LOAN REIT TRUST, 
 as Depositor, 
  
 ACCREDITED HOME
LENDERS, INC., 
 as Sponsor and Servicer, 
  
 ACCREDITED MORTGAGE LOAN TRUST 2005-3, 
 as
Issuer, 
  
 and 
  
 LASALLE BANK NATIONAL ASSOCIATION, 
 as Indenture Trustee 

 TABLE OF CONTENTS 
  

					
	 	  	 	  	Page

	ARTICLE I	  	 
	DEFINITIONS	  	 
			
	 Section 1.01.
	  	Certain Defined Terms	  	1
	 Section 1.02.
	  	Provisions of General Application	  	2
	
	ARTICLE II
	SALE AND CONVEYANCE OF THE MORTGAGE LOANS
			
	 Section 2.01.
	  	Purchase and Sale of Mortgage Loans; Deposit of Derivatives	  	2
	 Section 2.02.
	  	Reserved	  	3
	 Section 2.03.
	  	Purchase Price	  	3
	 Section 2.04.
	  	Possession of Mortgage Files; Access to Mortgage Files	  	3
	 Section 2.05.
	  	Delivery of Mortgage Loan Documents	  	3
	 Section 2.06.
	  	Acceptance of the Trust Estate; Certain Substitutions; Certification by the Indenture Trustee	  	6
	 Section 2.07.
	  	Grant of Security Interest	  	8
	 Section 2.08.
	  	Further Action Evidencing Assignments	  	9
	 Section 2.09.
	  	Assignment of Agreement	  	9
		
	ARTICLE III	  	 
	REPRESENTATIONS, WARRANTIES AND COVENANTS	  	 
			
	 Section 3.01.
	  	Representations, Warranties and Covenants of the Servicer	  	10
	 Section 3.02.
	  	Representations, Warranties and Covenants of the Sponsor	  	12
	 Section 3.03.
	  	[Reserved]	  	13
	 Section 3.04.
	  	Representations, Warranties and Covenants of the Indenture Trustee	  	13
	 Section 3.05.
	  	Covenants and Representations of the Sponsor and Servicer Regarding Prepayment Charges	  	14
	 Section 3.06.
	  	Representations, Warranties and Covenants of the Depositor	  	14
		
	ARTICLE IV	  	 
	THE MORTGAGE LOANS	  	 
			
	 Section 4.01.
	  	Representations and Warranties Concerning the Mortgage Loans	  	16
	 Section 4.02.
	  	Purchase and Substitution	  	25
		
	ARTICLE V	  	 
	ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS	  	 
			
	 Section 5.01.
	  	The Servicer	  	26
	 Section 5.02.
	  	Collection of Certain Mortgage Loan Payments; Collection Account	  	29
	 Section 5.03.
	  	Permitted Withdrawals from the Collection Account	  	31
	 Section 5.04.
	  	Hazard Insurance Policies; Property Protection Expenses	  	32

  

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	 Section 5.05.
	  	Assumption and Modification Agreements	  	33
	 Section 5.06.
	  	Realization Upon Defaulted Mortgage Loans	  	34
	 Section 5.07.
	  	Indenture Trustee to Cooperate	  	35
	 Section 5.08.
	  	Servicing Compensation; Payment of Certain Expenses by Servicer	  	36
	 Section 5.09.
	  	Annual Statement as to Compliance	  	36
	 Section 5.10.
	  	Annual Independent Public Accountants’ Servicing Report	  	36
	 Section 5.11.
	  	Access to Certain Documentation	  	37
	 Section 5.12.
	  	Maintenance of Fidelity Bond	  	37
	 Section 5.13.
	  	Subservicing Agreements Between the Servicer and Subservicer and Subservicers	  	37
	 Section 5.14.
	  	Reports to the Indenture Trustee; Collection Account Statements	  	38
	 Section 5.15.
	  	Optional Purchase of Defaulted Mortgage Loans	  	38
	 Section 5.16.
	  	Reports to be Provided by the Servicer	  	39
	 Section 5.17.
	  	[Reserved]	  	40
	 Section 5.18.
	  	Delinquency Advances	  	40
	 Section 5.19.
	  	Indemnification; Third Party Claims	  	41
	 Section 5.20.
	  	Maintenance of Corporate Existence and Licenses; Merger or Consolidation of the Servicer	  	41
	 Section 5.21.
	  	Assignment of Agreement by Servicer; Servicer Not to Resign	  	42
	 Section 5.22.
	  	Periodic Filings with the Securities and Exchange Commission Additional Information	  	42
	 Section 5.23.
	  	Administrative Duties	  	43
	 Section 5.24.
	  	Advance Facility	  	44
		
	ARTICLE VI	  	 
	APPLICATION OF FUNDS	  	 
			
	 Section 6.01.
	  	Deposits to the Payment Account	  	46
	 Section 6.02.
	  	Collection of Money	  	47
	 Section 6.03.
	  	Application of Principal and Interest	  	47
	 Section 6.04.
	  	[Reserved]	  	47
	 Section 6.05.
	  	Compensating Interest	  	47
		
	ARTICLE VII	  	 
	SERVICER DEFAULT	  	 
			
	 Section 7.01.
	  	Servicer Events of Default	  	47
	 Section 7.02.
	  	Indenture Trustee to Act: Appointment of Successor	  	50
	 Section 7.03.
	  	Waiver of Defaults	  	53
		
	ARTICLE VIII	  	 
	TERMINATION	  	 
			
	 Section 8.01.
	  	Termination	  	53
	 Section 8.02.
	  	Additional Termination Requirements	  	54
	 Section 8.03.
	  	Accounting Upon Termination of Servicer	  	54

  

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	ARTICLE IX	  	 
	[RESERVED]	  	 
		
	ARTICLE X	  	 
	MISCELLANEOUS PROVISIONS	  	 
			
	 Section 10.01.
	  	Limitation on Liability	  	55
	 Section 10.02.
	  	Acts of Noteholders	  	55
	 Section 10.03.
	  	Amendment	  	56
	 Section 10.04.
	  	Recordation of Agreement	  	57
	 Section 10.05.
	  	Duration of Agreement	  	57
	 Section 10.06.
	  	Notices	  	57
	 Section 10.07.
	  	Severability of Provisions	  	57
	 Section 10.08.
	  	No Partnership	  	58
	 Section 10.09.
	  	Counterparts	  	58
	 Section 10.10.
	  	Successors and Assigns	  	58
	 Section 10.11.
	  	Headings	  	58
	 Section 10.12.
	  	No Petition	  	58
	 Section 10.13.
	  	Third Party Beneficiary	  	58
	 Section 10.14.
	  	Intent of the Parties	  	58
	 Section 10.15.
	  	GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL	  	58
			
	 Schedule I
	  	Mortgage Loan Schedule	  	 
	 Appendix I
	  	Defined Terms	  	 
		
	EXHIBITS	  	 
			
	 Exhibit A
	  	Contents of the Mortgage File	  	 
	 Exhibit B
	  	Reserved	  	 
	 Exhibit C
	  	Indenture Trustee’s Acknowledgement of Receipt	  	 
	 Exhibit D
	  	Initial Certification of Indenture Trustee	  	 
	 Exhibit E
	  	Final Certification of Indenture Trustee	  	 
	 Exhibit F
	  	Request for Release of Documents	  	 
	 Exhibit G
	  	AHL Officer’s Certificate	  	 

  

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 SALE AND SERVICING AGREEMENT, dated as of August 1, 2005 (this “Agreement”), by and
among ACCREDITED MORTGAGE LOAN REIT TRUST, a Maryland real estate investment trust, as depositor (the “Depositor”), ACCREDITED HOME LENDERS, INC., a California corporation, as sponsor (the “Sponsor”), ACCREDITED
MORTGAGE LOAN TRUST 2005-3, a Delaware statutory trust, as issuer (the “Issuer”), ACCREDITED HOME LENDERS, INC., a California corporation, as servicer (the “Servicer”), and LASALLE BANK NATIONAL ASSOCIATION, a
national banking association, as indenture trustee (the “Indenture Trustee”). 
  
 WITNESSETH 
  
 WHEREAS, the
Sponsor has contributed the mortgage loans (the “Mortgage Loans”) listed on Schedule I to this Agreement to the Depositor, pursuant to the Contribution Agreement and Assignment, dated August 11, 2005, between the Sponsor and the
Depositor, (the “Contribution Agreement”); 
  
 WHEREAS, the Depositor desires to sell to the Issuer, and the Issuer desires to purchase from the Depositor, the Mortgage Loans; 
  
 WHEREAS, immediately after such purchase, the Issuer will pledge such Mortgage Loans to the Indenture Trustee pursuant to the terms of an Indenture, dated
as of August 1, 2005 (the “Indenture”), between the Issuer and the Indenture Trustee, and issue the Accredited Mortgage Loan Trust 2005-3, Asset-Backed Notes (the “Notes”); 
  
 WHEREAS, the Servicer has agreed to service the Mortgage Loans, which
constitute the principal assets of the Trust; 
  
 WHEREAS, the
Indenture Trustee will hold the Mortgage Loans and certain other assets pledged to the Indenture Trustee pursuant to the Indenture; 
  
 WHEREAS, the Issuer will enter into an interest rate swap agreement with the Swap Provider where the Issuer agrees to pay certain fixed-rate amounts to
the Swap Provider and the Swap Provider agrees to pay certain floating-rate amounts to the Trust; and 
  
 NOW, THEREFORE, in consideration of the premises and the mutual agreements herein contained, the Depositor, the Sponsor, the Issuer, the Servicer and the
Indenture Trustee hereby agree as follows: 
  
 ARTICLE I

  
 DEFINITIONS 
  
 Section 1.01. Certain Defined Terms. Capitalized terms used herein but
not defined herein shall have the meanings ascribed to such terms in Appendix I attached hereto. 
  

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 Section 1.02. Provisions of General Application. 
  
 (a) The terms defined herein and in Appendix I to the
Indenture include the plural as well as the singular. 
  
 (b) The words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Agreement as a whole. Unless otherwise noted, all references to Articles and Sections shall be deemed to refer to
Articles and Sections of this Agreement. 
  
 (c)
Any reference to statutes are to be construed as including all statutory provisions consolidating, amending or replacing the statute to which reference is made and all regulations promulgated pursuant to such statutes. 
  
 (d) All calculations of interest with respect to the LIBOR
Notes provided for herein shall be on the basis of a 360-day year and the actual number of days elapsed in the related Interest Accrual Period. All calculations of interest with respect to any Mortgage Loan provided for herein shall be made in
accordance with the terms of the related Mortgage Note and Mortgage or, if such documents do not specify the basis upon which interest accrues thereon, on the basis of a 360 day year consisting of twelve 30-day months, to the extent permitted by
applicable law. 
  
 (e) Any Mortgage Loan payment
is deemed to be received on the date such payment is actually received by the Servicer; provided, however, that, for purposes of calculating payments on the Notes, prepayments with respect to any Mortgage Loan are deemed to be received
on the date they are applied in accordance with Accepted Servicing Practices consistent with the terms of the related Mortgage Note and Mortgage to reduce the outstanding Principal Balance of such Mortgage Loan on which interest accrues. 

 
 ARTICLE II 
  
 SALE AND CONVEYANCE OF THE MORTGAGE LOANS 
  
 Section 2.01. Purchase and Sale of Mortgage Loans; Deposit of
Derivatives. 
  
 (a) The Sponsor hereby
directs the Depositor to sell, transfer, assign, set over and convey, and the Depositor does hereby sell, transfer, assign, set over and convey to the Issuer, in each case without recourse, but subject to the terms and provisions of this Agreement,
all of the right, title and interest of the Depositor in and to the Mortgage Loans, including the Cut-Off Date Principal Balance of, and interest due on, such Mortgage Loans listed on Schedule I attached hereto, and all other assets included or to
be included in the Trust Estate (other than the Swap Agreement, which is being entered into directly by the Issuer). 
  
 (b) The Depositor may cause the deposit of derivatives at any time into the Accredited Mortgage Loan Trust 2005-3 and any such deposited
derivatives shall become part of the Trust Estate. 
  

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 (c) The parties hereto understand and agree that it is not intended that any Mortgage
Loan be included in the Issuer that is a “High-Cost Home Loan” as defined by HOEPA or any other applicable predatory or abusive lending laws. 
  
 Section 2.02. Reserved. 
  
 Section 2.03. Purchase Price. On the Closing Date, as full consideration for the Depositor’s sale of the Mortgage Loans to the Issuer, the
Underwriters, on behalf of the Issuer, will deliver to, or at the direction of, the Depositor an amount in cash equal to $1,108,303,297.50. Additionally, the Depositor will receive the Certificates issued by the Issuer pursuant to the Trust
Agreement. 
  
 Section 2.04. Possession of Mortgage Files;
Access to Mortgage Files. 
  
 (a) Upon the
receipt by the Depositor, or its designee, of the purchase price for the Mortgage Loans set forth in Section 2.03 hereof, the ownership of each Mortgage Note, each Mortgage and the contents of the Mortgage File related to each Mortgage Loan will be
vested in the Issuer, and will be pledged to the Indenture Trustee, for the benefit of the Noteholders. 
  
 (b) Pursuant to Section 2.05 hereof, the Depositor has delivered, or caused to be delivered the Indenture Trustee’s Mortgage File
related to each Mortgage Loan to the Indenture Trustee. 
  
 (c) The Indenture Trustee will hold the Indenture Trustee’s Mortgage Files in trust pursuant to the terms of the Indenture for the benefit of all present and future Noteholders and the Swap Provider. 

 
 (d) Consistent with the terms of the Indenture, the
Indenture Trustee shall afford the Depositor, the Sponsor, the Issuer and the Servicer reasonable access to all records and documentation regarding the Mortgage Loans relating to this Agreement, such access being afforded at customary charges, upon
reasonable prior written request and during normal business hours at the offices of the Indenture Trustee. 
  
 (e) No later than the fifth Business Day of each fourth month, commencing in December 2005, the Indenture Trustee shall deliver to the
Servicer a report dated as of the first day of such month, identifying those Mortgage Loans for which it has not yet received (i) an original recorded Mortgage or a copy thereof certified to be true and correct by the public recording office in
possession of such Mortgage or (ii) in the event that Assignments of Mortgage are required to be recorded in accordance with the provisions of Section 2.05, an original recorded Assignment of Mortgage to the Indenture Trustee and any required
intervening Assignments of Mortgage or a copy thereof certified to be a true and correct copy by the public recording office in possession of such Assignment of Mortgage. 
  
 Section 2.05. Delivery of Mortgage Loan Documents. (a) In connection with the transfer and assignment of the Mortgage
Loans, the Depositor shall, on or before the Closing Date, deliver, or cause to be delivered, to the Indenture Trustee (as pledgee of the Issuer pursuant to 

  

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the Indenture), the following documents or instruments constituting the Indenture Trustee’s Mortgage File with respect to each Mortgage Loan so
transferred or assigned: 
  
 (i) the original
Mortgage Note, endorsed without recourse in blank or to “LaSalle Bank National Association, as Indenture Trustee under the Indenture dated as of August 1, 2005, Accredited Mortgage Loan Trust 2005-3” by the Sponsor, including all
intervening endorsements showing a complete chain of endorsement; 
  
 (ii) the related original Mortgage with evidence of recording indicated thereon or a copy thereof certified by the applicable recording office and if the Mortgage Loan is registered on the MERS System, such Mortgage
or an assignment of the mortgage shall reflect MERS as the mortgagee of record and shall include the MIN for such Mortgage Loan; 
  
 (iii) each intervening mortgage assignment, with evidence of recording indicated thereon or if the original is not available, a copy
thereof certified by the applicable recording office, if any, showing a complete chain of assignment from the originator of the related Mortgage Loan to the Sponsor (or to MERS, if the Mortgage Loan is registered on the MERS System), and noting the
presence of a MIN (if the Mortgage Loan is registered on the MERS System), which assignment may, at the Sponsor’s option, be combined with the assignment referred to in subpart (iv) hereof, in which case it must be in recordable form, but need
not have been previously recorded); 
  
 (iv)
unless the Mortgage Loan is registered on the MERS System, a mortgage assignment in recordable form (which, if acceptable for recording in the relevant jurisdiction as evidenced by an Opinion of Counsel addressed to the Indenture Trustee, may be
included in a blanket assignment or assignments) of each Mortgage from the Sponsor to the Indenture Trustee; 
  
 (v) originals of all assumption, modification and substitution agreements in those instances where the terms or provisions of a Mortgage
or Mortgage Note have been modified or such Mortgage or Mortgage Note has been assumed (if any); and 
  
 (vi) an original title insurance policy or title opinion (or (A) a copy of the title insurance policy or title opinion, or (B) the related
binder, commitment or preliminary report, or copy thereof in which case the Sponsor hereby certifies that the original Mortgage has been delivered to the title insurance company that issued such binder, commitment or preliminary report). 

 
 In instances where the original recorded Mortgage or any intervening
mortgage assignment or a completed assignment of the Mortgage in recordable form cannot be delivered by the Sponsor to the Indenture Trustee prior to or concurrently with the execution and delivery of this Agreement due to a delay in connection with
recording, the Sponsor may: 
  
 (x) in lieu of
delivering such original recorded Mortgage or intervening mortgage assignment, deliver to the Indenture Trustee, a copy thereof and the Sponsor hereby certifies that the original Mortgage has been delivered to a title insurance 

  

 4 

 
company for recordation after receipt of its policy of title insurance or the related binder, commitment or preliminary report therefor; and 
  
 (y) with respect to clause (iv) above, in lieu of delivering
the completed assignment in recordable form, deliver to the Indenture Trustee, the assignment in recordable form, otherwise complete except for recording information. 
  
 The Indenture Trustee is hereby authorized and directed, upon an Event of Default and subject to subsection (b) below, with respect to each
assignment described in Section 2.05(a)(iv) hereof, to endorse such assignment as follows: “LaSalle Bank National Association, as Indenture Trustee under the Indenture dated as of August 1, 2005, Accredited Mortgage Loan Trust 2005-3.”

  
 (b) As promptly as practicable, but in any
event within thirty (30) days from the Closing Date, the Sponsor shall promptly submit, or cause to be submitted for recording in the appropriate public office for real property records, each assignment referred to in Section 2.05(a)(iv); provided,
that the Sponsor need not cause to be recorded any assignment which (i) is registered on the MERS System, or (ii) relates to a Mortgage Loan in any jurisdiction under the laws of which, as evidenced by an Opinion of Counsel delivered by the Sponsor
(at the Sponsor’s expense) to the Indenture Trustee, acceptable to the Rating Agencies, the recordation of such assignment is not necessary to protect the Indenture Trustee’s, the Noteholders’, the Swap Provider’s and the
Certificates’ interest in the related Mortgage Loan. The Indenture Trustee, shall retain a copy of each assignment submitted for recording. In the event that any such assignment is lost or returned unrecorded because of a defect therein, the
Sponsor shall promptly prepare a substitute assignment or cure such defect, as the case may be, and thereafter the Sponsor shall submit each such assignment for recording. The costs relating to the delivery and recordation of the documents in
connection with the Mortgage Loans as specified in this Article II shall be borne by the Sponsor. With respect to Mortgage Loans (i) not registered on the MERS System, or (ii) not covered by an Opinion of Counsel described in this section 2.05(b) to
the extent that assignments of mortgage have not been recorded within one year after the Closing Date, the Depositor shall, and if the Depositor fails to, then the Sponsor shall be obligated to repurchase such Mortgage Loans in accordance with the
provisions of Section 4.02. 
  
 In connection with the
assignment of any Mortgage Loan registered on the MERS System, promptly after the Closing Date, the Sponsor will cause, at its own expense, the MERS System to indicate that such Mortgage Loan has been assigned to the Indenture Trustee for the
benefit of the Noteholders by entering (a) the Indenture Trustee’s Org ID in the “Investor” field which identifies the Indenture Trustee and (b) in the “Pool” field a code which identifies the securitization serial number of
the Notes issued in connection with such Mortgage Loans. The Sponsor and the Servicer will not alter the entries referenced in this paragraph with respect to any such Mortgage Loan during the term of this Agreement unless and until such Mortgage
Loan is repurchased or otherwise in accordance with the terms of this Agreement. 
  
 (c) The Sponsor shall, within five (5) Business Days after the receipt thereof, deliver, or cause to be delivered, to the Indenture
Trustee: (i) the original recorded Mortgage and related power of attorney, if any, in those instances where a copy thereof certified by the Sponsor was delivered to the Indenture Trustee; (ii) the original recorded assignment of Mortgage from the
last endorsee to the Indenture Trustee, which, together with any intervening assignments of 

  

 5 

 
Mortgage, evidences a complete chain of assignment from the originator of the Mortgage Loan to the Indenture Trustee, in those instances where copies of such
assignments certified by the Sponsor were delivered to the Indenture Trustee; and (iii) the title insurance policy or title opinion required in Section 2.05(a)(vi). 
  
 Notwithstanding anything to the contrary contained in this Section 2.05, in those instances where the public recording
office retains the original Mortgage, power of attorney, if any, assignment or assignment of Mortgage after it has been recorded or such original has been lost, the Sponsor shall be deemed to have satisfied its obligations hereunder upon delivery to
the Indenture Trustee, of a copy of such Mortgage, power of attorney, if any, assignment or assignment of Mortgage certified by the public recording office to be a true copy of the recorded original thereof. 
  
 From time to time the Sponsor may forward, or cause to be forwarded, to the
Indenture Trustee, additional original documents evidencing any assumption or modification of a Mortgage Loan. 
  
 (d) All original documents relating to the Mortgage Loans that are not required to be delivered to the Indenture Trustee, pursuant to
Section 2.05(a) hereof are, and shall be, held by the Servicer, the Sponsor or the Depositor, as the case may be, in trust for the benefit of the Indenture Trustee, on behalf of the Noteholders and the Swap Provider. In the event that any such
original document is required pursuant to the terms of this Section 2.05 to be a part of an Indenture Trustee’s Mortgage File, such document shall be delivered promptly to the Indenture Trustee. From and after the sale of the Mortgage Loans to
the Issuer pursuant hereto, to the extent that the last assignee thereof retains title of record to any Mortgage Loans prior to the vesting of legal title in the Issuer, such title shall be retained in trust for the Issuer as the owner of the
Mortgage Loans, and the Indenture Trustee, as the pledgee of the Issuer under the Indenture. In acting as custodian of any original document which is part of the Indenture Trustee’s Mortgage Files, the Servicer agrees further that it does not
and will not have or assert any beneficial ownership interest in the related Mortgage Loans or the Mortgage Files. Promptly upon the Servicer’s receipt of any such original document, the Servicer, on behalf of the Issuer, shall mark
conspicuously each such original document, and its master data processing records with a legend evidencing that the Issuer has purchased the related Mortgage Loan and all right and title thereto and interest therein, and pledged such Mortgage Loan
and all right and title thereto and interest therein to the Indenture Trustee, on behalf of the Noteholders and the Swap Provider. 
  
 Section 2.06. Acceptance of the Trust Estate; Certain Substitutions; Certification by the Indenture Trustee. (a) The Indenture Trustee is authorized and
directed to, and agrees to, do the following: 
  
 (i) execute and deliver to the Depositor, the Sponsor and the Servicer, on or prior to the Closing Date with respect to each Mortgage Loan transferred on such date, an acknowledgement of receipt, in the form attached as Exhibit C
hereto, of the original Mortgage Note as required to be included in the Indenture Trustee’s Mortgage File (with any exceptions noted) and declares that it will hold such documents and any amendments, replacements or supplements thereto, as well
as any other assets included in 

  

 6 

 
the definition of Trust Estate and delivered to the Indenture Trustee, subject to the conditions set forth in the Indenture, for the benefit of the
Noteholders. 
  
 (ii) to review (or cause to be
reviewed) each Indenture Trustee’s Mortgage File within sixty (60) days after the Closing Date (or, with respect to any Qualified Substitute Mortgage Loans, within sixty (60) days after receipt thereof), and to deliver to the Servicer, the
Depositor and the Sponsor a certification, in the form attached hereto as Exhibit D, to the effect that, except as otherwise noted, as to each Mortgage Loan listed in the related Mortgage Loan Schedule (other than any Mortgage Loan paid in
full or any Mortgage Loan specifically identified in such certification as not covered by such certification), (i) all documents specified in Section 2.05(a)(i)-(iv) and (vi) are in its possession, (ii) each such document has been reviewed by it and
appears, on its face, not to have been mutilated, damaged, torn or otherwise physically altered (handwritten additions, changes or corrections shall not constitute physical alteration if they reasonably appear to have been initialed), appears
regular on its face and relates to such Mortgage Loan, and (iii) based on its examination and only as to the foregoing documents, the information set forth on the Mortgage Loan Schedule with respect to items (i), (ii) (with respect to property
address only, excluding zip code), (iii) and (vi) of the definition of “Mortgage Loan Schedule” accurately reflects the information set forth in the Indenture Trustee’s Mortgage File delivered on such date; provided
however, no certification of the Indenture Trustee shall constitute a determination by the Indenture Trustee of the proper form, adequacy or enforceability of any document included in the Indenture Trustee’s Mortgage File. 
  
 (iii) to review (or cause to be reviewed) each Indenture
Trustee’s Mortgage File within one hundred eighty (180) days after the Closing Date (or, with respect to any Qualified Substitute Mortgage Loans, within one hundred eighty (180) days after receipt thereof), and to deliver to the Servicer and
the Sponsor a certification in the form attached hereto as Exhibit E to the effect that, except as otherwise noted, as to each Mortgage Loan listed in the related Mortgage Loan Schedule (other than any Mortgage Loan paid in full or any
Mortgage Loan specifically identified in such certification as not covered by such certification), (i) all documents specified in Section 2.05(a)(i)-(iv) and (vi) are in its possession, (ii) each such document has been reviewed by it and has not
been mutilated, damaged, torn or otherwise physically altered (handwritten additions, changes or corrections shall not constitute physical alteration if they reasonably appear to be initialed by the Mortgagor), appears regular on its face and
relates to such Mortgage Loan, and (iii) based on its examination and only as to the foregoing documents, the information set forth in items (i), (ii) (with respect to property address only, excluding zip code), (iii) and (vi) of the definition of
“Mortgage Loan Schedule” accurately reflects the information set forth in the Indenture Trustee’s Mortgage File delivered on such date. 
  
 In performing any such review, the Indenture Trustee may conclusively rely on the Sponsor as to the purported genuineness of any such document and any
signature thereon. It is understood that the scope of the Indenture Trustee’s review of the Indenture Trustee’s Mortgage Files is limited solely to confirming that the documents listed in Section 2.05 have been executed and received and
relate to the Indenture Trustee’s Mortgage Files identified in the related 

  

 7 

 
Mortgage Loan Schedule. The Indenture Trustee shall be under no duty or obligation to inspect, review or examine any such documents, instruments,
certificates or other papers to determine that they are genuine, enforceable, or appropriate for the represented purpose or that they are other than what they purport to be on their face. 
  
 (b) If the Indenture Trustee during the process of reviewing
the Indenture Trustee’s Mortgage Files finds any document constituting a part of a Indenture Trustee’s Mortgage File which is not executed, has not been received, is unrelated to the Mortgage Loan identified in the related Mortgage Loan
Schedule, or does not conform to the requirements of Section 2.05 or the description thereof as set forth in the related Mortgage Loan Schedule, the Indenture Trustee shall promptly so notify the Servicer and the Sponsor. Upon receipt of such notice
respecting such defect, the Depositor and the Sponsor shall have a sixty (60) day period after such notice within which to correct or cure any such defect, or if the Servicer determines that the defect materially and adversely affects the value of
the related Mortgage Loan or the interest of the Noteholders in the related Mortgage Loan, to either (i) substitute in lieu of such Mortgage Loan a Qualified Substitute Mortgage Loan in the manner and subject to the conditions set forth in this
Section 2.06 or (ii) purchase such Mortgage Loan at a purchase price equal to the Loan Repurchase Price. Upon receipt by the Indenture Trustee of two copies of a certification, in the form attached hereto as Exhibit F, of a Servicing Officer
of such substitution or purchase and, in the case of a substitution, upon receipt by the Indenture Trustee, of the related Indenture Trustee’s Mortgage File, and the deposit of the Loan Repurchase Price, in the case of a purchase, or the
Substitution Adjustment, if any, in connection with a substitution, in the Collection Account, the Indenture Trustee shall release to the Servicer for release to the Depositor or the Sponsor, as applicable, the related Indenture Trustee’s
Mortgage File and the Indenture Trustee shall execute, without recourse, and deliver such instruments of transfer furnished by the Depositor or the Sponsor as may be necessary to transfer such Mortgage Loan to the Depositor or the Sponsor, as
applicable. 
  
 Section 2.07. Grant of Security Interest.
(a) It is intended that the conveyance of the Mortgage Loans and other property by the Depositor to the Issuer as provided in this Article II be, and be construed for all purposes other than tax and accounting purposes as, a sale of the Mortgage
Loans and such other property by the Depositor to the Issuer. It is, for all purposes other than tax and accounting purposes further, not intended that such conveyance be deemed a pledge of the Mortgage Loans or such other property by the Depositor
to the Issuer to secure a debt or other obligation of the Depositor. However, in the event that the Mortgage Loans or any of such other property are held to be property of the Depositor, or if for any reason this Agreement is held or deemed to
create a security interest in the Mortgage Loans or any of such other property, then it is intended that: (i) this Agreement shall also be deemed to be a security agreement within the meaning of the Uniform Commercial Code; (ii) the conveyance
provided for in this Article II shall be deemed to be a grant by the Depositor to the Issuer of a security interest in all of the Depositor’s right, title and interest in and to the Mortgage Loans and such other property and all amounts payable
to the holders of the Mortgage Loans in accordance with the terms thereof and all proceeds of the conversion, voluntary or involuntary, of the foregoing into cash, instruments, securities or other property, including, without limitation, all amounts
from time to time held or invested in the Accounts whether in the form of cash, instruments, securities or other property; (iii) the possession by the Indenture Trustee, of the Mortgage Notes and such other items of property as constitute
instruments, money, negotiable documents or 

  

 8 

 
chattel paper shall be deemed to be “possession by the secured party” for purposes of perfecting the security interest pursuant to the Uniform
Commercial Code; and (iv) notifications to persons holding such property, and acknowledgments, receipts or confirmations from persons holding such property, shall be deemed notifications to, or acknowledgments, receipts or confirmations from
financial intermediaries, bailees or agents, as applicable, of the Indenture Trustee for the purpose of perfecting such security interest under applicable law. The Depositor, the Sponsor, the Servicer, on behalf of the Issuer and the Indenture
Trustee, shall, to the extent consistent with this Agreement, take such actions as may be reasonably necessary to ensure that, if this Agreement were deemed to create a security interest in the Mortgage Loans or any of such other property, such
security interest would be deemed to be a perfected security interest of first priority under applicable law and will be maintained as such throughout the term of this Agreement. 
  
 (b) The Depositor, the Sponsor and the Servicer shall take no action inconsistent with the Trust’s
ownership of the Trust Estate and each shall indicate or shall cause to be indicated in its records and records held on its behalf that ownership of each Mortgage Loan and the other assets in the Trust Estate is vested in the Issuer, as owner, and
is pledged to the Indenture Trustee, for the benefit of the Noteholders and the Swap Provider pursuant to the terms of the Indenture. The Indenture Trustee is authorized to act, pursuant to the terms of this Agreement for the benefit of the
Noteholders and shall be authorized to act at the direction of such parties. In addition, the Depositor, the Sponsor and the Servicer shall respond to any inquiries from third parties with respect to ownership of a Mortgage Loan or any other asset
in the Trust Estate by stating that it is not the owner of such asset and that the Issuer is the owner of such Mortgage Loan or other asset in the Trust Estate, which is pledged to the Indenture Trustee, for the benefit of the Noteholders and the
Swap Provider. 
  
 Section 2.08. Further Action Evidencing
Assignments. (a) The Servicer agrees that, from time to time, at its expense, it shall cause the Sponsor or Depositor, as the case may be, to, and each of the Sponsor and Depositor agree that it shall, promptly execute and deliver all further
instruments and documents, and take all further action, that may be necessary or appropriate, or that the Servicer or the Indenture Trustee may reasonably request, in order to perfect, protect or more fully evidence the transfer of ownership of the
Mortgage Loans and other assets in the Trust Estate or to enable the Indenture Trustee, to exercise or enforce any of its rights hereunder. Without limiting the generality of the foregoing, the Servicer, the Sponsor and the Depositor shall, upon the
request of the Servicer or the Indenture Trustee execute and file (or cause to be executed and filed) such real estate filings, financing or continuation statements, or amendments thereto or assignments thereof, and such other instruments or
notices, as may be necessary or appropriate. 
  
 (b) Each of the Sponsor and the Depositor hereby grants to the Servicer and the Indenture Trustee powers of attorney to execute all documents on its behalf under this Agreement as may be necessary or desirable to effectuate the foregoing.

  
 Section 2.09. Assignment of Agreement. The Sponsor, the
Depositor and the Servicer hereby acknowledge and agree that the Issuer may assign its interest under this Agreement to the Indenture Trustee, for the benefit of the Noteholders and the Swap Provider, as may be required to effect the purposes of the
Indenture, without further notice to, or consent of, the Sponsor or the 

  

 9 

 
Servicer, and the Indenture Trustee shall succeed to such of the rights of the Issuer hereunder as shall be so assigned. The Issuer shall, pursuant to the
Indenture, assign all of its right, title and interest in and to the Mortgage Loans and its right to exercise the remedies created by Section 4.02 of this Agreement for breaches of the representations, warranties, agreements and covenants of the
Sponsor contained in Sections 3.02 and 4.01 of this Agreement, assign such right, title and interest to the Indenture Trustee, for the benefit of the Noteholders and the Swap Provider. The Sponsor agrees that, upon such assignment to the Indenture
Trustee, such representations, warranties, agreements and covenants will run to and be for the benefit of the Indenture Trustee and the Indenture Trustee may enforce, without joinder of the Sponsor or the Issuer, the repurchase obligations of the
Sponsor set forth herein with respect to breaches of such representations, warranties, agreements and covenants. 
  
 ARTICLE III 
  
 REPRESENTATIONS, WARRANTIES AND COVENANTS 
  
 Section 3.01. Representations, Warranties and Covenants of the Servicer. The Servicer hereby represents, warrants and covenants to the Indenture Trustee, the Depositor, the Sponsor, the Issuer, the Swap Provider and the Noteholders
as of the Closing Date and during the term of this Agreement that: 
  
 (a) The Servicer is duly organized, validly existing and in good standing under the laws of its state of incorporation and has the power to own its assets and to transact the business in which it is currently engaged.
The Servicer is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction in which the character of the business transacted by it or properties owned or leased by it or the performance of its obligations
hereunder requires such qualification and in which the failure so to qualify could reasonably be expected to have a material adverse effect on the business, properties, assets, or condition (financial or other) of the Servicer or the performance of
its obligations hereunder. 
  
 (b) The Servicer
has the power and authority to make, execute, deliver and perform this Agreement and all of the transactions contemplated under this Agreement, and has taken all necessary corporate action to authorize the execution, delivery and performance of this
Agreement, and assuming the due authorization, execution and delivery hereof by the other parties hereto constitutes, or will constitute, the legal, valid and binding obligation of the Servicer, enforceable in accordance with its terms, except as
enforcement of such terms may be limited by bankruptcy, insolvency, reorganization, 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). 
  
 (c) The Servicer is not required to obtain the consent of any other party or any consent, license, approval or authorization from, or registration or declaration with, any governmental authority, bureau or agency which consent already has
not been obtained in connection with the execution, delivery, performance, validity or enforceability of this Agreement, except such as have been obtained prior to the Closing Date. 
  

 10 

 (d) The execution, delivery and performance of this Agreement by the Servicer will not
violate any provision of any existing law or regulation or any order or decree of any court or the charter or bylaws of the Servicer, or constitute a breach of any mortgage, indenture, contract or other Agreement to which the Servicer is a party or
by which it may be bound. 
  
 (e) Except as set
forth in the Prospectus Supplement under the heading “Risk Factors,” there is no action, suit, proceeding or investigation pending or to Servicer’s knowledge threatened against the Servicer which, either in any one instance or
in the aggregate, is, in the Servicer’s judgment, likely to result in any material adverse change in the business, operations, financial condition, properties, or assets of the Servicer, or in any material impairment of the right or ability of
the Servicer to carry on its business substantially as now conducted, or in any material liability on the part of the Servicer, or which would draw into question the validity of this Agreement, the Notes, or the Mortgage Loans or of any action taken
or to be taken in connection with the obligations of the Servicer contemplated herein or therein, or which would be likely to impair materially the ability of the Servicer to perform its obligations hereunder. 
  
 (f) Neither this Agreement nor any statement, report, or
other document furnished by the Servicer pursuant to this Agreement or in connection with the transactions contemplated hereby, including, without limitation, the sale or placement of the Notes, contains any untrue material statement of fact
provided by or on behalf of the Servicer or omits to state a material fact necessary to make the statements provided by or on behalf of the Servicer contained herein or therein not misleading. 
  
 (g) The Servicer does not believe, nor does it have any
reason or cause to believe, that it cannot perform each and every covenant contained in this Agreement. 
  
 (h) The Servicer is not an “investment company” or a company “controlled by an investment company,” within the meaning
of the Investment Company Act of 1940, as amended. 
  
 (i) The Servicer shall take all necessary steps to maintain the Indenture Trustee’s perfection and priority in the Mortgage Loans. 
  
 (j) The Servicer will fully furnish, in accordance with the Fair Credit Reporting Act and its implementing regulations, accurate and
complete information (i.e., favorable and unfavorable) on its borrower credit files to Equifax, Experian, and Trans Union Credit Information Company (three of the credit repositories), on a monthly basis. 
  
 (k) The Servicer is a member of MERS in good standing, and
will comply in all material respects with the rules and procedures of MERS in connection with the servicing of the Mortgage Loans that are registered with MERS. 
  

It is understood and agreed that the representations, warranties and covenants set forth in this Section 3.01 shall survive the delivery of the
respective Indenture Trustee’s Mortgage Files to the Indenture Trustee and inure to the benefit of the Indenture Trustee. 
  

 11 

 Section 3.02. Representations, Warranties and Covenants of the Sponsor. The Sponsor hereby
represents, warrants and covenants to the Indenture Trustee, the Depositor, the Issuer, the Swap Provider and the Servicer that as of the date of this Agreement or as of such date specifically provided herein: 
  
 (a) The Sponsor is a corporation duly organized, validly
existing and in good standing under the laws of the State of California. 
  
 (b) The Sponsor has the corporate power and authority to execute, deliver and perform, and to enter into and consummate the transactions contemplated by this Agreement. 
  
 (c) This Agreement has been duly and validly authorized,
executed and delivered by the Sponsor, all requisite corporate action having been taken, and, assuming the due authorization, execution and delivery hereof by the other parties hereto, constitutes or will constitute the legal, valid and binding
agreement of the Sponsor, enforceable against the Sponsor in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency, reorganization, 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). 
  
 (d) No consent, approval, authorization or order of or registration or filing with, or notice to, any governmental authority or court is
required for the execution, delivery and performance of or compliance by the Sponsor with this Agreement or the consummation by the Sponsor of any of the transactions contemplated hereby, except as have been made on or prior to the Closing Date.

  
 (e) None of the execution and delivery of
this Agreement, the consummation of the transactions contemplated hereby or thereby, or the fulfillment of or compliance with the terms and conditions of this Agreement, (i) conflicts or will conflict with or results or will result in a breach of,
or constitutes or will constitute a default or results or will result in an acceleration under (A) the articles of incorporation or bylaws of the Sponsor, or (B) of any term, condition or provision of any material indenture, deed of trust, contract
or other agreement or instrument to which the Sponsor or any of its subsidiaries is a party or by which it or any of its subsidiaries is bound; (ii) results or will result in a violation of any law, rule, regulation, order, judgment or decree
applicable to the Sponsor of any court or governmental authority having jurisdiction over the Sponsor or its subsidiaries; or (iii) results in the creation or imposition of any lien, charge or encumbrance which would have a material adverse effect
upon the Mortgage Loans or any documents or instruments evidencing or securing the Mortgage Loans. 
  
 (f) Except as set forth in the Prospectus Supplement under the heading “Risk Factors,” there are no actions, suits or
proceedings before or against or investigations of, the Sponsor pending, or to the knowledge of the Sponsor, threatened, before any court, administrative agency or other tribunal, and no notice of any such action, which, in the Sponsor’s
reasonable judgment, might materially and adversely affect the performance by the Sponsor of its obligations under this Agreement, or the validity or enforceability of this Agreement. 
  

 12 

 (g) The Sponsor is not in default with respect to any order or decree of any court or any
order, regulation or demand of any federal, state, municipal or governmental agency that may materially and adversely affect its performance hereunder. 
  
 It is understood and agreed that the representations, warranties and covenants set forth in this Section 3.02 may not be waived and shall survive delivery
of the respective Indenture Trustee’s Mortgage Files to the Indenture Trustee and shall inure to the benefit of the Indenture Trustee. 
  
 Section 3.03. [Reserved.] 
  
 Section 3.04. Representations, Warranties and Covenants of the Indenture Trustee. The Indenture Trustee hereby represents, warrants and covenants
to the Issuer, the Swap Provider, the Servicer, the Depositor and the Sponsor that as of the date of this Agreement or as of such date specifically provided herein: 
  
 (a) The Indenture Trustee is a national banking association duly organized, validly existing and in good
standing under the laws of the United States of America; 
  
 (b) The Indenture Trustee has the requisite power and authority to execute, deliver and perform, and to enter into and consummate transactions contemplated by this Agreement; 
  
 (c) This Agreement has been duly and validly authorized,
executed and delivered by the Indenture Trustee, all requisite action having been taken, and, assuming the due authorization, execution and delivery hereof by the other parties hereto, constitutes or will constitute the legal, valid and binding
agreement of the Indenture Trustee, enforceable against the Indenture Trustee in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency, reorganization, 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); 
  
 (d) No consent, approval, authorization or order of or registration or filing with, or notice to, any
governmental authority or court is required for the execution, delivery and performance of or compliance by the Indenture Trustee with this Agreement or the consummation by the Indenture Trustee of any of the transactions contemplated hereby, except
as have been made on or prior to the Closing Date; 
  
 (e) None of the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby or thereby, or the fulfillment of or compliance with the terms and conditions of this Agreement, (i) conflicts or will
conflict with or results or will result in a breach of, or constitutes or will constitute a default or results or will result in an acceleration under (A) the articles of association or bylaws of the Indenture Trustee, or (B) to the best of its
knowledge, of any term, condition or provision of any material indenture, deed of trust, contract or other agreement or instrument to which the Indenture Trustee is a party or by which it is bound; or (ii) results or will result in a violation of
any statute, rule, regulation, order, judgment or decree applicable to the Indenture Trustee of any court or governmental authority having 

  

 13 

 
jurisdiction over the Indenture Trustee or its subsidiaries which violation would materially and adversely affect the Indenture Trustee’s performance of
its duties hereunder; and 
  
 (f) There are no
actions, suits or proceedings before or against or investigations of, the Indenture Trustee, pending or to the knowledge of the Indenture Trustee threatened, before any court, administrative agency or other tribunal, and no notice of any such
action, which, in the Indenture Trustee’s reasonable judgment, would materially and adversely affect the performance by the Indenture Trustee of its obligations under this Agreement, or the validity or enforceability of this Agreement.

  
 It is understood and agreed that the representations,
warranties and covenants set forth in this Section 3.04 shall survive delivery of the respective Indenture Trustee’s Mortgage Files to the Indenture Trustee. 
  
 Section 3.05. Covenants and Representations of the Sponsor and Servicer Regarding Prepayment Charges. 

  
 (a) The Servicer covenants that it will not
waive any Prepayment Charge or part of a Prepayment Charge unless in connection with a Mortgage Loan that is in default or for which a default is reasonably foreseeable. 
  
 (b) The Sponsor hereby represents and warrants that the information set forth in the Prepayment Charge
Schedule is complete, true and correct in all material respects at the date or dates respecting which such information is furnished and each Prepayment Charge is permissible and enforceable in accordance with its terms (except to the extent that the
enforceability thereof may be limited by bankruptcy, insolvency, moratorium, receivership and other similar laws relating to creditors’ rights generally) under applicable law. 
  
 (c) Upon discovery by the Sponsor or the Indenture Trustee of a breach of the foregoing, the party
discovering such breach shall give prompt written notice to the other parties. Within 60 days of the earlier of discovery by the Servicer or receipt of notice by the Servicer of breach, the Servicer shall cure such breach in all material respects.
If the covenant made by the Servicer in clause (a) above is breached the Servicer must pay into the Collection Account the amount of the waived Prepayment Charge. If the representation made by the Sponsor in clause (b) above is breached, the Sponsor
must pay into the Collection Account the amount of the scheduled Prepayment Charge, less any amount previously collected and paid by the Servicer into the Collection Account. The foregoing obligations of the Servicer and the Sponsor shall be the
sole and exclusive remedies for a breach of this Section 3.05(a) or (b). 
  
 Section 3.06. Representations, Warranties and Covenants of the Depositor. The Depositor hereby represents, warrants and covenants to the Indenture Trustee, the Issuer, the Swap Provider, the Sponsor and the
Servicer that as of the date of this Agreement or as of such date specifically provided herein: 
  
 (a) The Depositor is a Maryland real estate investment trust duly organized, validly existing and in good standing under the laws of the
State of Maryland. 
  

 14 

 (b) The Depositor has the trust power and authority to convey the Mortgage Loans and to
execute, deliver and perform, and to enter into and consummate the transactions contemplated by this Agreement. 
  
 (c) This Agreement has been duly and validly authorized, executed and delivered by the Depositor, all requisite corporate action having
been taken, and, assuming the due authorization, execution and delivery hereof by the other parties hereto, constitutes or will constitute the legal, valid and binding agreement of the Depositor, enforceable against the Depositor in accordance with
its terms, except as such enforcement may be limited by bankruptcy, insolvency, reorganization, 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). 
  
 (d) No consent, approval, authorization or order of or registration or filing with, or notice to, any governmental authority or court is required for the execution, delivery and performance of or compliance by the
Depositor with this Agreement or the consummation by the Depositor of any of the transactions contemplated hereby, except as have been made on or prior to the Closing Date. 
  
 (e) None of the execution and delivery of this Agreement, the consummation of the transactions contemplated
hereby or thereby, or the fulfillment of or compliance with the terms and conditions of this Agreement, (i) conflicts or will conflict with or results or will result in a breach of, or constitutes or will constitute a default or results or will
result in an acceleration under (A) the certificate of trust or bylaws of the Depositor, or (B) of any term, condition or provision of any material indenture, deed of trust, contract or other agreement or instrument to which the Depositor or any of
its subsidiaries is a party or by which it or any of its subsidiaries is bound; (ii) results or will result in a violation of any law, rule, regulation, order, judgment or decree applicable to the Depositor of any court or governmental authority
having jurisdiction over the Depositor or its subsidiaries; or (iii) results in the creation or imposition of any lien, charge or encumbrance which would have a material adverse effect upon the Mortgage Loans or any documents or instruments
evidencing or securing the Mortgage Loans. 
  
 (f) Except as set forth in the Prospectus Supplement under the heading “Risk Factors,” there are no actions, suits or proceedings before or against or investigations of, the Depositor pending, or to the knowledge of the
Depositor, threatened, before any court, administrative agency or other tribunal, and no notice of any such action, which, in the Depositor’s reasonable judgment, might materially and adversely affect the performance by the Depositor of its
obligations under this Agreement, or the validity or enforceability of this Agreement. 
  
 (g) The Depositor is not in default with respect to any order or decree of any court or any order, regulation or demand of any federal,
state, municipal or governmental agency that may materially and adversely affect its performance hereunder. 
  
 (h) The Depositor hereby covenants that it will file a federal income tax return for its taxable year ending December 31, 2004 on Internal
Revenue Service Form 1120 REIT on which the Depositor elects to be taxed as a REIT. The Depositor hereby represents that it has 

  

 15 

 
been organized in conformity with the requirements for qualification for taxation as a REIT and hereby covenants that it at all times the Depositor owns
Trust Certificates, either directly, or indirectly through one or more Qualified REIT Subsidiaries, will conduct its operations so as to qualify as a REIT. If, at any time the Depositor owns Trust Certificates, either directly, or indirectly through
one or more Qualified REIT Subsidiaries, the Depositor determines that is has failed to qualify as a REIT, the Depositor shall, within 30 days of such discovery, notify the Indenture Trustee of such failure. 
  
 It is understood and agreed that the representations,
warranties and covenants set forth in this Section 3.06 shall survive delivery of the respective Indenture Trustee’s Mortgage Files to the Indenture Trustee and shall inure to the benefit of the Indenture Trustee. 
  
 ARTICLE IV 
  
 THE MORTGAGE LOANS 
  
 Section 4.01. Representations and Warranties Concerning the Mortgage
Loans. The Sponsor makes the following representations and warranties to the Depositor, the Servicer, the Indenture Trustee, the Swap Provider and the Issuer as to the Mortgage Loans on which the Issuer relies in accepting the Mortgage Loans in
trust and executing the Notes. All uses and variations of the word “enforceable” in this Section 4.01, shall be deemed to be qualified as such enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors’ rights generally and by general principles of equity (whether considered in a proceeding or action in equity or at law). With respect to the representations and warranties stated in Sections
4.01(i), (r), (ddd), (eee) and (fff), the Sponsor makes such representations and warranties on behalf of itself and the Depositor. Such representations, warranties and covenants are made or deemed to be made as of the Closing Date.

  
 (a) The information with respect to each
Mortgage Loan set forth in the Mortgage Loan Schedule is true and correct as of the Cut-Off Date, based on Cut-Off Date Principal Balances. 
  
 (b) Each Mortgage Loan is being serviced either (i) through the Servicer or (ii) a Person controlling, controlled by or under common
control with the Servicer and qualified to service mortgage loans. 
  
 (c) Each Mortgage Loan was underwritten or reunderwritten pursuant to the Underwriting Guidelines which conform in all material respects to the description thereof set forth in the Prospectus Supplement. 

 
 (d) All of the original or certified documentation
required to be delivered to the Indenture Trustee pursuant to this Agreement (including all material documents related thereto) with respect to each Mortgage Loan has been or will be delivered to the Indenture Trustee in accordance with the terms of
this Agreement. Each of the documents and instruments specified to be included therein has been duly executed and in due and proper form, and each such document or instrument is in a form generally acceptable to prudent mortgage lenders that 

  

 16 

 
regularly originate or purchase mortgage loans comparable to the Mortgage Loans for sale to prudent investors in the secondary market that invest in mortgage
loans such as the Mortgage Loans. 
  
 (e)
[Reserved.] 
  
 (f) Each Mortgaged Property is
improved by a single (one to four) family residential dwelling, which may include condominiums, individual units in a planned unit development and townhouses but shall not include cooperatives. 
  
 (g) No Mortgage Loan had an LTV at origination in excess of
100% (references to loan-to-value ratios are references to combined loan-to-value ratios with respect to second-lien Mortgage Loans). 
  
 (h) Each Mortgage Loan is a valid, subsisting enforceable and perfected first or second lien as identified on the Mortgage Loan Schedule
on the Mortgaged Property and subject in all cases to the exceptions to title set forth in the title insurance policy, with respect to the related Mortgage Loan, which exceptions are generally acceptable to banking institutions in connection with
their regular mortgage lending activities, and such other exceptions to which similar properties are commonly subject and which do not individually, or in the aggregate, materially and adversely affect the benefits of the security intended to be
provided by such Mortgage. At the time each Mortgage Loan was originated, the originator was a mortgagee approved by the Secretary of Housing and Urban Development pursuant to Sections 203 and 211 of the National Housing Act or a savings and loan
association, a savings bank, a commercial bank or similar banking institution which was supervised and examined by a federal or state authority or a mortgage banker or broker licensed or authorized to do business in the jurisdiction in which the
related Mortgaged Property is located, applying the same standards and procedures used by the Sponsor in originating Mortgage Loans directly. 
  
 (i) Immediately prior to the transfer and assignment of the Mortgage Loans to the Depositor pursuant to the Contribution Agreement, the
Sponsor held good and marketable title to, and was the sole owner of each Mortgage Loan, subject to no liens, charges, mortgages or encumbrances or rights of others, except liens of third party warehouse lenders that will be released simultaneously
with the transfer and assignment contemplated herein; and immediately prior to the transfer and assignment herein contemplated, the Depositor held good and marketable title to, and was the sole owner of, each Mortgage Loan subject to no liens,
charges, mortgages, encumbrances or rights of others except liens which will be released simultaneously with such transfer and assignment; and immediately upon the transfer and assignment herein contemplated, the Indenture Trustee will hold good and
marketable title to, and be the sole owner of, each Mortgage Loan subject to no liens, charges, mortgages, encumbrances or rights of others except liens which will be released simultaneously with such transfer and assignment. 
  
 (j) There is no delinquent tax or assessment lien on any
Mortgaged Property, and each Mortgaged Property is free of substantial damage and is in good repair. 
  
 (k) There is no valid and enforceable right of rescission, set-off, defense or counterclaim to any Mortgage Note or Mortgage, including
the obligation of the related 

  

 17 

 
Mortgagor to pay the unpaid principal of or interest on such Mortgage Note or the defense of usury, nor will the operation of any of the terms of the
Mortgage Note or the Mortgage, or the exercise of any right thereunder, render either the Mortgage Note or the Mortgage unenforceable in whole or in part, or subject to any right of rescission, set-off, counterclaim or defense, including the defense
of usury, and no such right of rescission, set-off, counterclaim or defense has been asserted with respect thereto. 
  
 (l) There is no mechanics’ lien or claim for work, labor or material affecting any Mortgaged Property which is or may be a lien prior
to, or equal with and no rights are outstanding that under the law gives rise to such liens, the lien of the related Mortgage except those which are insured against by any title insurance policy referred to in paragraph (n) below. 
  
 (m) Each Mortgage Loan at the time it was made complied
with, and each Mortgage Loan at all times was serviced in compliance with, in each case, in all material respects, applicable local, state and federal laws and regulations, including, without limitation, the federal Truth-in-Lending Act and other
consumer protection laws, the Home Ownership and Equity Protection Act of 1994, real estate settlement procedure, usury, equal credit opportunity, disclosure and recording laws and all applicable predatory and abusive lending laws. 
  
 (n) With respect to each Mortgage Loan, a lender’s
title insurance policy, issued in standard California Land Title Association form or American Land Title Association form, or other form acceptable in a particular jurisdiction by a title insurance company authorized to transact business in the
state in which the related Mortgaged Property is situated, in an amount at least equal to the original Principal Balance of such Mortgage Loan insuring the mortgagee’s interest under the related Mortgage Loan as the holder of a valid first
mortgage lien of record on the real property described in the related Mortgage, as the case may be, subject only to exceptions of the character referred to in paragraph (h) above, was effective on the date of the origination of such Mortgage Loan,
and, as of the Closing Date such policy will be valid and inure to the benefit of the Indenture Trustee on behalf of the Noteholders. 
  
 (o) The improvements upon each Mortgaged Property are covered by a valid and existing hazard insurance policy (which may be a blanket
policy of the type described in this Agreement) with a generally acceptable carrier that provides for fire and extended coverage representing coverage not less than the least of (i) the outstanding Principal Balance of the related Mortgage Loan,
(ii) the minimum amount required to compensate for damage or loss on a replacement cost basis or (iii) the full insurable value of the Mortgaged Property. 
  
 (p) If any Mortgaged Property is in an area identified in the Federal Register by the Federal Emergency Management Agency as having
special flood hazards, a flood insurance policy (which may be a blanket policy of the type described in this Agreement) in a form meeting the requirements of the current guidelines of the Federal Insurance Administration is in effect with respect to
such Mortgaged Property with a generally acceptable carrier in an amount representing coverage not less than the least of (i) the outstanding Principal Balance of the related Mortgage Loan (together, in the case of a second mortgage loan, with the
outstanding principal balance of the first mortgage loan), (ii) the minimum amount required to compensate for damage or loss on a replacement cost basis or (iii) the maximum amount of insurance that is available under the Flood Disaster Protection
Act of 1973. 
  

 18 

 (q) Each Mortgage and Mortgage Note is the legal, valid and binding obligation of the
maker thereof and is enforceable in accordance with its terms, except only as such enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally
and by general principles of equity (whether considered in a proceeding or action in equity or at law), and all parties to each Mortgage Loan had full legal capacity to execute all documents relating to such Mortgage Loan and convey the estate
therein purported to be conveyed. 
  
 (r) The
Sponsor has directed and the Depositor has caused to be performed any and all acts required to be performed to preserve the rights and remedies of the Indenture Trustee in any Insurance Policies applicable to any Mortgage Loan delivered by the
Sponsor or the Depositor including, to the extent such Mortgage Loan is not covered by a blanket policy described in this Agreement, any necessary notifications of insurers, assignments of policies or interests therein, and establishments of
coinsured, joint loss payee and mortgagee rights in favor of the Indenture Trustee. 
  
 (s) The Sponsor has caused or will have caused, within ten days, the filing of all appropriate financing statements in the proper filing
office in the appropriate jurisdictions under applicable law in order to perfect the security interest in the original Mortgage Note and all subsequent assignments of the original Mortgage, granted to the Indenture Trustee hereunder, subject to the
provisions of Section 2.05(b) of this Agreement. 
  
 (t) The terms of each Mortgage Note and each Mortgage have not been impaired, altered, waived or modified in any respect, except by a written instrument which has been recorded, if necessary, to protect the interest of the Noteholders and
which has been delivered to the Indenture Trustee. 
  
 (u) The proceeds of each Mortgage Loan have been fully disbursed, and there is no obligation on the part of the mortgagee to make future advances thereunder. All costs, fees and expenses incurred in making or closing or recording such
Mortgage Loans were paid. 
  
 (v) Except as
otherwise required by law or pursuant to the statute under which the related Mortgage Loan was made, the related Mortgage Note is not and has not been secured by any collateral, pledged account or other security except the lien of the corresponding
Mortgage. 
  
 (w) No Mortgage Loan was originated
under a buydown plan. 
  
 (x) No Mortgage Loan
provides for negative amortization, has a shared appreciation feature, or other contingent interest feature. 
  
 (y) Each Mortgaged Property is located in the state identified in the Mortgage Loan Schedule and consists of one or more parcels of real
property with a residential dwelling erected thereon and that no residence or dwelling is a mobile home. 
  
 (z) Each Mortgage securing a Mortgage Note contains a provision for the acceleration of the payment of the unpaid Principal Balance of the
related Mortgage Loan in the 

  

 19 

 
event the related Mortgaged Property is sold without the prior consent of the mortgagee thereunder. 
  
 (aa) Any advances made after the date of origination of a
Mortgage Loan but prior to the Cut-Off Date, have been consolidated with the outstanding principal amount secured by the related Mortgage, and the secured principal amount, as consolidated, bears a single interest rate and single repayment term
reflected on the Mortgage Loan Schedule. The consolidated principal amount does not exceed the original principal amount of the related Mortgage Loan. No Mortgage Note permits or obligates the Depositor, the Servicer, the Sponsor or any other Person
to make future advances to the related Mortgagor at the option of the Mortgagor. 
  
 (bb) There is no proceeding pending or threatened for the total or partial condemnation of any Mortgaged Property, nor is such a
proceeding currently occurring, and each Mortgaged Property is undamaged by waste, fire, earthquake or earth movement, flood, tornado or other casualty, so as to affect adversely the value of the Mortgaged Property as security for the Mortgage Loan
or the use for which the premises were intended. 
  
 (cc) All of the improvements which were included for the purposes of determining the Appraised Value of any Mortgaged Property lie wholly within the boundaries and building restriction lines of such Mortgaged Property, and no improvements
on adjoining properties encroach upon such Mortgaged Property, except as stated in the related title insurance policy and affirmatively insured. 
  
 (dd) No improvement located on or being part of any Mortgaged Property is in violation of any applicable zoning law or regulation. As of
the related date of origination, all inspections, licenses and certificates required to be made or issued with respect to all occupied portions of each Mortgaged Property and, with respect to the use and occupancy of the same, including, but not
limited to, certificates of occupancy and fire underwriting certificates, have been made or obtained from the appropriate authorities and such Mortgaged Property is lawfully occupied under the applicable law. 
  
 (ee) With respect to each Mortgage constituting a deed of
trust, a trustee, duly qualified under applicable law to serve as such, has been properly designated and currently so serves and is named in such Mortgage, and no fees or expenses are or will become payable by the Sponsor, the Depositor, or the
Issuer to the trustee under the deed of trust, except in connection with a trustee’s sale after default by the related Mortgagor. 
  
 (ff) [Reserved.] 
  
 (gg) [Reserved.] 
  
 (hh) Each Mortgage contains customary and enforceable provisions which render the rights and remedies of the holder thereof adequate for
the realization against the related Mortgaged Property of the benefits of the security, including (i) in the case of a Mortgage designated as a deed of trust, by trustee’s sale and (ii) otherwise by judicial foreclosure. There is no homestead
or other exemption available which materially interferes with the right to sell the related Mortgaged Property at a trustee’s sale or the right to foreclose the related Mortgage. 
  

 20 

 (ii) There is no default, breach, violation or event of acceleration existing under any
Mortgage or the related Mortgage Note and no event which, with the passage of time or with notice and the expiration of any grace or cure period, would constitute a default, breach, violation or event of acceleration; and the Depositor has not
waived any default, breach, violation or event of acceleration. 
  
 (jj) No instrument of release or waiver has been executed in connection with any Mortgage Loan, and no Mortgagor has been released, in whole or in part. 
  
 (kk) [Reserved.] 
  

(ll) The Sponsor has no actual knowledge that there exists on any Mortgaged Property any hazardous substances, hazardous wastes or
solid wastes, as such terms are defined in the CERCLA, the Resource Conservation and Recovery Act of 1976, or other federal, state or local environmental legislation. 
  
 (mm) No action, error, omission, misrepresentation, negligence, fraud or similar occurrence with respect to
the origination of a Mortgage Loan has taken place on the part of any person, including, without limitation, the Mortgagor, any appraiser, any builder or developer, or any other party involved in the origination of the Mortgage Loan or in the
application of any insurance in relation to such Mortgage Loan. 
  
 (nn) The Sponsor has not solicited the Mortgagor in connection with any refinancing. 
  
 (oo) If the Mortgage Loan is an adjustable rate Mortgage Loan, all of the adjustments to the Mortgage Interest Rate, to the amount of the
monthly payment, and to the principal balance have been made in accordance with the terms of the related Mortgage Note. 
  
 (pp) The origination and collection practices used with respect to the Mortgage Loan have been in all respects legal, proper, prudent and
customary in the mortgage origination and servicing business. 
  
 (qq) An appraisal of the related Mortgaged Property was made and signed, prior to the approval of the Mortgage Loan application, by a qualified appraiser who met the requirements of the Sponsor’s appraisal policy
and procedures and who had no interest, direct or indirect in the Mortgaged Property or in any loan made on the security thereof, whose compensation was not affected by the approval or disapproval of the Mortgage Loan. 
  
 (rr) The Mortgagor has received all disclosure materials
required by applicable law with respect to the making of adjustable rate mortgage loans; and if the Mortgage Loan is a refinanced Mortgage Loan, the Mortgagor has received all disclosure and rescission materials required by applicable law with
respect to the making of a refinanced Mortgage Loan, and evidence of such receipt is and will remain in the Servicer’s file. 
  
 (ss) If the residential dwelling on the Mortgaged Property is a condominium unit or a unit in a planned unit development (other than a de
minimis planned unit development), 

  

 21 

 
such condominium or planned unit development project meets the Sponsor’s eligibility requirements. 
  
 (tt) None of the Mortgage Loans was more than one payment
past due or had been dishonored. None of the Mortgage Loans have been thirty or more days delinquent more than one time in the twelve months preceding the Cut-Off Date. 
  
 (uu) The Sponsor has not advanced funds, or induced, solicited or knowingly received any advance of funds by
a person other than the Mortgagor, directly or indirectly, for the payment of any amount required under the Mortgage Loan, except for interest prepaid upon the closing of the Mortgage Loan. No Mortgage Loan contains any provision pursuant to which
Monthly Payments are: (i) paid or partially paid with funds deposited in any separate account established by the Sponsor, the Mortgagor, or anyone on behalf of the Mortgagor or (ii) paid by any source other than the Mortgagor. The Mortgage Loan is
not deemed a graduated payment mortgage loan and the Mortgage Loan does not have a shared appreciation or other contingent interest feature. 
  
 (vv) No foreclosure proceedings are pending against the Mortgaged Property and the Mortgage Loan is not subject to any pending bankruptcy
or insolvency proceeding, and to the Sponsor’s best knowledge, no material litigation or material lawsuit relating to the Mortgage Loan is pending. 
  
 (ww) Principal payments on the Mortgage Loan commenced or will commence within sixty days after the proceeds of the Mortgage Loan were
disbursed. 
  
 (xx) With respect to escrow
deposits, if any, all such payments are in the possession of, or under the control of, the Servicer and there exists no deficiencies in connection therewith for which customary arrangements for repayment thereof have not been made or could be made.
No escrow deposits or escrow advances or other charges or payments due the Servicer have been capitalized under any Mortgage or the related Mortgage Note. 
  
 (yy) With respect to the conveyance of the Mortgage Loans by the Sponsor to the Depositor, the Sponsor used no selection procedures that
identified the Mortgage Loans as being less desirable or valuable than other comparable mortgage loans originated or acquired by the Sponsor. The Mortgage Loans are representative of the Sponsor’s portfolio of fixed-rate or adjustable-rate
mortgage loans, as applicable. With respect to the conveyance of the Mortgage Loans pursuant to this Agreement, the Depositor used no selection procedures that identified the Mortgage Loans as being less desirable or valuable than other comparable
mortgage loans originated or acquired by the Depositor. The Mortgage Loans are representative of the Depositor’s portfolio of fixed-rate or adjustable-rate mortgage loans, as applicable. 
  
 (zz) Each Mortgage Loan conforms, and all such Mortgage
Loans in the aggregate conform in all material respects to the description thereof set forth in the Prospectus Supplement. 
  
 (aaa) All requirements for the valid transfer of each Insurance Policy, including any assignments or notices required in each Insurance
Policy, have been satisfied. 
  

 22 

 (bbb) This Agreement creates a valid and continuing security interest (as defined in the
applicable UCC) in the Mortgage Loans in favor of the Indenture Trustee, which security interest is prior to all other liens, and is enforceable as such as against creditors of and purchasers from the Depositor. 
  
 (ccc) The Mortgage Loans constitute “instruments”
within the meaning of the applicable UCC. 
  
 (ddd) The Sponsor received all consents and approvals required by the terms of the Mortgage Loans to the contribution of the Mortgage Loans pursuant to the Contribution Agreement to the Depositor and the Depositor has received all consents
and approvals required by the terms of the Mortgage Loans to the sale of the Mortgage Loans hereunder to the Owner Trustee and the subsequent pledge to the Indenture Trustee. 
  
 (eee) Other than the security interest granted to the Indenture Trustee pursuant to the Indenture, neither
the Sponsor nor the Depositor has pledged, assigned, sold, granted a security interest in, or otherwise conveyed any of the Mortgage Loans. Neither the Sponsor nor the Depositor has authorized the filing of nor is aware of any financing statements
against the Sponsor or the Depositor that include a description of collateral covering the Mortgage Loans other than any financing statement relating to the security interest granted to the Indenture Trustee hereunder or that has been terminated.
Neither the Sponsor nor the Depositor is aware of any judgment or tax lien filings affecting the Mortgage Loans against either the Depositor or the Sponsor. 
  
 (fff) All financing statements filed or to be filed against the Sponsor or the Depositor in favor of the Indenture Trustee in connection
herewith describing the Mortgage Loans contain a statement to the following effect: “A purchase of or security interest in any collateral described in this financing statement will violate the rights of the Indenture Trustee.” 

 
 (ggg) None of the Mortgage Loans are classified as (a)
“high cost” loans under the Home Ownership and Equity Protection Act of 1994 or (b) “high cost,” “threshold,” “covered”, “predatory” or “abusive” loans under any other applicable state,
federal or local law (including without limitation any regulation or ordinance) (or a similarly classified loan using different terminology under a law imposing heightened regulatory scrutiny or additional legal liability for residential mortgage
loans having high interest rates, points and/or fees). 
  
 (hhh) No proceeds from any Mortgage Loan were used to finance single-premium credit insurance policies. 
  
 (iii) No Mortgage Loan is a “High Cost Home Loan” or “Covered Loan,” as applicable, (as such terms are defined in the
then current Standard & Poor’s LEVELS Glossary which is now Version 5.6b Revised, Appendix E) and no Mortgage Loan originated on or after October 1, 2002 through March 6, 2003 is governed by the Georgia Fair Lending Act. No Mortgage Loan
that was originated on or after October 1, 2002 and before March 7, 2003 is secured by property located in the State of Georgia. There is no Mortgage Loan that was originated on or after March 7, 2003 which is a “high cost home loan” as
defined under the Georgia Fair Lending Act. 
  

 23 

 (jjj) No Mortgage Loan is secured by a leasehold interest, unless such leasehold interest
extends 60 months beyond the stated maturity of the Mortgage Note. 
  
 (kkk) There is no pending action or proceeding directly involving the Mortgaged Property in which compliance with any environmental law, rule or regulation is an issue. Based upon customary and prudent residential
mortgage industry underwriting standards, there is no violation of any environmental law, rule or regulation with respect to the Mortgaged Property, and nothing further remains to be done to satisfy in full all requirements of each such law, rule or
regulation constituting a prerequisite to use and enjoyment of said property. 
  
 (lll) The Mortgagor has not notified Accredited, and Accredited has no knowledge of any relief requested or allowed to the Mortgagor under the Servicemembers Civil Relief Act or any similar state statute. 

 
 (mmm) No Mortgage Loan was made in connection with the
construction (other than a “construct to perm” loan) or rehabilitation of a Mortgaged Property or facilitating the trade in or exchange of a Mortgaged Property. 
  
 (nnn) Accredited has complied with all applicable anti money laundering laws and regulations, including
without limitation the USA Patriot Act of 2001 (collectively, the “Anti-Money Laundering Laws”). 
  
 (ooo) No Mortgage Loan imposes a Prepayment Charge for a term in excess of five years. 
  
 (ppp) No Mortgage Loan is a “High-Cost Home Loan”
as defined in the New Jersey Home Ownership Act, effective as of November 27, 2003, or the Home Loan Protection Act of New Mexico, effective as of January 1, 2004. 
  
 (qqq) No Mortgage Loan is a “High-Cost Home Loan” as defined in the Massachusetts Predatory Home
Loan Practice Act effective November 7, 2004 (MA House Bill 4880). 
  
 (rrr) With respect to the Mortgage Loans in Group I, (i) no Mortgage Loan imposes a Prepayment Charge for a term in excess of three years, (ii) the servicer for each Mortgage Loan has fully furnished (and, on a going
forward basis, will fully furnish), in accordance with the Fair Credit Reporting Act and its implementing regulations, accurate and complete information (i.e., favorable and unfavorable) on its borrower credit files to Equifax, Experian, and Trans
Union Credit Information Company (three of the credit repositories), on a monthly basis, (iii) with respect to any Mortgage Loan originated on or after August 1, 2004, neither the related mortgage nor the related mortgage note requires the borrower
to submit to arbitration to resolve any dispute arising out of or relating in any way to the mortgage loan transaction, (iv) no Mortgage Loan is covered by the Home Ownership and Equity Protection Act of 1994 (“HOEPA”), (v) no Mortgage
Loan is a “high cost home,” “covered” (excluding home loans defined as “covered home loans” in the New Jersey Home Ownership Security Act of 2002 that were originated between November 26, 2003 and July 7, 2004),
“high risk home” or “predatory” loan under any applicable state, federal or local law (or a similarly classified loan using different terminology under a law imposing heightened regulatory scrutiny or additional 

  

 24 

 
legal liability for residential mortgage loans having high interest rates, points and/or fees), and (vi) the original Principal Balance of each Mortgage Loan
was within Freddie Mac’s dollar amount limits for conforming one- to four-family mortgage loans, as follows: 
  

					
	 Number of Units

	  	 Maximum Original Loan Amount of First Mortgage

	  	 Continental United States or Puerto
Rico

	  	 Alaska, Guam, Hawaii or

 Virgin Islands

	 1
	  	359,650	  	539,475
	 2
	  	460,400	  	690,000
	 3
	  	556,500	  	834,750
	 4
	  	691,600	  	1,037,550

  
 (sss)
A breach of any one of the representations set forth in paragraphs (ggg), (hhh), (iii) and (qqq) above, will be deemed to materially and adversely affect the interests of the Noteholders and shall require a repurchase of the affected Mortgage Loan
pursuant to Section 4.02. 
  
 It is understood and agreed that the
representations, warranties and covenants set forth in this Section 4.01 shall survive delivery of the respective Indenture Trustee’s Mortgage Files to the Indenture Trustee and shall inure to the benefit of the Indenture Trustee on behalf of
the Noteholders. 
  
 Section 4.02. Purchase and
Substitution. (a) It is understood and agreed that the representations and warranties set forth in Section 4.01 shall survive the transfer of the Mortgage Loans by the Depositor to the Issuer, the subsequent pledge thereof by the Issuer to the
Indenture Trustee, for the benefit of the Noteholders, and the delivery of the Notes to the Noteholders, and shall continue in full force and effect, notwithstanding any restrictive or qualified endorsement on the Mortgage Notes and notwithstanding
subsequent termination of this Agreement. 
  
 (b) Upon discovery by the Depositor, the Sponsor, the Servicer, the Indenture Trustee or a Noteholder of a breach of any of the representations and warranties in Section 4.01 which materially and adversely affects the value of any Mortgage
Loan, or which materially and adversely affects the interests of the Noteholders in the related Mortgage Loan, the party discovering such breach or failure shall promptly (and in any event within five (5) days of the discovery) give written notice
thereof to the others. Within sixty (60) days of the earlier of its discovery or its receipt of notice of any breach of a representation or warranty, the Depositor shall, and if the Depositor fails to, then the Sponsor shall (a) promptly cure such
breach in all material respects, (b) purchase such Mortgage Loan on a Servicer Remittance Date, in the manner and at the price specified in Section 2.06(b) and this Section 4.02, or (c) remove such Mortgage Loan from the Trust Estate (in which case
it shall become a Deleted Mortgage Loan) and substitute one or more Qualified Substitute Mortgage Loans in the manner specified in Section 2.06 and this Section 4.02. The Indenture Trustee shall deliver prompt written notice to the Rating Agencies
of any repurchase or substitution made pursuant to this Section 4.02 or Section 2.06(b). 
  

 25 

 (c) As to any Deleted Mortgage Loan for which the Depositor or the Sponsor substitutes a
Qualified Substitute Mortgage Loan or Loans, the Servicer shall cause the Depositor or Sponsor to effect such substitution by delivering to the Indenture Trustee a certification, in the form attached hereto as Exhibit F, executed by a
Servicing Officer, and the documents described in Sections 2.05(a)(i)-(vi) for such Qualified Substitute Mortgage Loan or Loans. 
  
 (d) The Servicer shall deposit in the Collection Account all payments received in connection with such Qualified Substitute Mortgage Loan
or Loans after the date of such substitution. Monthly Payments due with respect to Qualified Substitute Mortgage Loans in or before the Due Period in which the substitution occurs shall not be part of the Trust Estate and will be retained by the
Sponsor on the next succeeding Payment Date. For the Due Period in which the substitution occurs, distributions to Noteholders will include the Monthly Payment due on any Deleted Mortgage Loan for such Due Period and thereafter the Sponsor shall be
entitled to retain all amounts received in respect of such Deleted Mortgage Loan. The Servicer shall give written notice to the Indenture Trustee that such substitution has taken place and shall amend the Mortgage Loan Schedule to reflect the
removal of such Deleted Mortgage Loan from the terms of this Agreement and the substitution of the Qualified Substitute Mortgage Loan or Loans. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of
this Agreement in all respects. 
  
 (e) With
respect to any Mortgage Loan that has been converted to an REO Mortgage Loan, all references in this Section 4.02 or Section 2.06 to “Mortgage Loan” shall be deemed to also refer to the REO Mortgage Loan. With respect to any Mortgage Loan
that the Depositor and Sponsor are required to repurchase that is or becomes a Liquidated Mortgage Loan, in lieu of repurchasing such Mortgage Loan, the Servicer shall deposit into the Payment Account, pursuant to Section 8.01 of the Indenture, an
amount equal to the amount of the Liquidated Loan Loss, if any, incurred in connection with the liquidation of such Mortgage Loan within the same time period in which the Servicer, Depositor or Sponsor would have otherwise been required to
repurchase such Mortgage Loan. 
  
 (f) It is
understood and agreed that the obligations of the Depositor and the Sponsor set forth in Sections 2.06 and 4.02 to cure, purchase or substitute for a defective Mortgage Loan, or to indemnify as described in Section 4.02(g) constitute the sole
remedies of the Indenture Trustee and the Noteholders respecting a breach of the representations and warranties of the Sponsor set forth in Section 4.01 of this Agreement. 
  
 (g) The Sponsor shall be obligated to indemnify the Depositor, the Indenture Trustee, the Issuer, the Owner
Trustee and the Noteholders for any third party claims arising out of a breach by the Sponsor of representations or warranties regarding the Mortgage Loans. 
  
 ARTICLE V 
  
 ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS 
  
 Section 5.01. The Servicer. (a) The Servicer shall service and administer the Mortgage Loans in accordance with this Agreement and in accordance
with Accepted Servicing Practices, 

  

 26 

 
and shall have full power and authority, acting alone, to do or cause to be done any and all things in connection with such servicing and administration
which it may deem necessary or desirable. 
  
 (b)
The Servicer shall exercise its discretion consistent with Accepted Servicing Practices and the terms of this Agreement, with respect to the enforcement of defaulted Mortgage Loans in such manner as will maximize the receipt of principal and
interest with respect thereto, including but not limited to the sale of such Mortgage Loan to a third party, the modification of such Mortgage Loan, or foreclosure upon the related property with a Mortgage and disposition thereof. 
  
 (c) The duties of the Servicer shall include collecting and
posting of all payments, responding to inquiries of Mortgagors or by federal, state or local government authorities with respect to the Mortgage Loans, investigating delinquencies, reporting tax information to Mortgagors in accordance with its
customary practices and accounting for collections and furnishing monthly and annual statements to the Indenture Trustee with respect to distributions, paying Compensating Interest and making Delinquency Advances and Servicing Advances pursuant
hereto. The Servicer shall follow its customary standards, policies and procedures in performing its duties as Servicer. The Servicer shall cooperate with the Indenture Trustee and furnish to the Indenture Trustee with reasonable promptness
information in its possession as may be necessary or appropriate to enable the Indenture Trustee to perform its tax reporting duties hereunder. The Indenture Trustee shall furnish the Servicer with any powers of attorney and other documents as the
Indenture Trustee shall deem necessary or appropriate to enable the Servicer to carry out its servicing and administrative duties hereunder; provided, however, the Servicer shall prepare for and deliver to the Indenture Trustee for its execution any
such powers of attorney; provided, further, that the Indenture Trustee shall not be responsible for any misuse of any such power of attorney. Notwithstanding anything contained herein to the contrary, the Servicer shall not, without the Indenture
Trustee’s written consent: (i) initiate any action, suit or proceeding directly relating to the servicing of the Mortgage Loan solely under the Indenture Trustee’s name without indicating the Servicer’s representative capacity, (ii)
initiate any other action, suit or proceeding not directly relating to the servicing of any Mortgage Loan (including but not limited to actions, suits or proceedings against Noteholders or Certificateholders, or against the Depositor for breaches of
representations and warranties) solely under the Indenture Trustee’s name, (iii) engage counsel to represent the Indenture Trustee in any action, suit or proceeding not directly related to the servicing of any Mortgage Loan (including but not
limited to actions, suits or proceedings against Noteholders or Certificateholders, or against the Depositor for breaches of representations and warranties, or (iv) prepare, execute or deliver any government filings, forms, permits, registrations or
other documents or take any action with the intent to cause, and that actually causes, the Indenture Trustee to be registered to do business in any state. 
  
 (d) [Reserved.] 
  
 (e) The Servicer shall, in accordance with Accepted Servicing Practices, have the right to approve requests of Mortgagors for consent to
(i) partial releases of Mortgage Loans and (ii) alterations, removal, demolition or division of Mortgaged Properties subject to Mortgage Loans. No such request shall be approved by the Servicer unless: (x) the provisions of the related Mortgage Note
have been complied with; (y) the LTV (which may, for this purpose, be 

  

 27 

 
determined at the time of any such action) after any release does not exceed the LTV set forth for such Mortgage Loan in the Mortgage Loan Schedule; and (z)
the lien priority, monthly payment, Mortgage Interest Rate or maturity date of the related Mortgage is not affected except in accordance with Section 5.01(f); provided, however, that the foregoing requirements (x), (y) and (z) shall
not apply to any such situation described in this paragraph if such situation results from any condemnation or easement activity by a governmental entity. 
  
 (f) Notwithstanding anything else contained herein, the Servicer may not agree to a modification or extension of any Mortgage Loan unless
both (i) such Mortgage Loan is in default or a default thereon is reasonably foreseeable and (ii) such modification or extension would not result in the Servicer agreeing to modifications or extensions on Mortgage Loans with Initial Pool Balances of
the related Group of more than 5.0% of the Maximum Collateral Amount. In addition, the Servicer may not agree to more than (i) one modification or extension with respect to any individual Mortgage Loan in a calendar year or (ii) three modifications
or extensions of an individual Mortgage Loan during the life of such Mortgage Loan. 
  
 (g) [Reserved.] 
  
 (h) Without limiting the generality of the foregoing, but subject to Sections 5.05 and 5.06, the Servicer in its own name may be
authorized and empowered pursuant to a power of attorney executed and delivered by the Indenture Trustee to execute and deliver, and may be authorized and empowered by the Indenture Trustee, to execute and deliver, on behalf of itself, the
Noteholders and the Indenture Trustee or any of them, (i) 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, (ii) and to institute foreclosure proceedings or obtain a deed in lieu of foreclosure so as to effect ownership of any Mortgaged Property on behalf of the Indenture Trustee, and (iii) to hold title to any Mortgaged Property
upon such foreclosure or deed in lieu of foreclosure on behalf of the Indenture Trustee; provided, however, that Section 5.07(a) shall constitute a power of attorney from the Indenture Trustee to the Servicer to execute an instrument
of satisfaction (or assignment of mortgage without recourse) with respect to any Mortgage Loan paid in full (or with respect to which payment in full has been escrowed). Subject to Sections 5.05 and 5.06, the Indenture Trustee shall furnish the
Servicer with any powers of attorney and other documents as the Servicer shall reasonably request to enable the Servicer to carry out its servicing and administrative duties hereunder; provided, however, the Servicer shall prepare for and deliver to
the Indenture Trustee for its execution any such powers of attorney; provided, further, that the Indenture Trustee shall not be responsible for any misuse of any such power of attorney. Notwithstanding anything contained herein to the contrary, the
Servicer shall not, without the Indenture Trustee’s written consent: (i) initiate any action, suit or proceeding directly relating to the servicing of the Mortgage Loan solely under the Indenture Trustee’s name without indicating the
Servicer’s representative capacity, (ii) initiate any other action, suit or proceeding not directly relating to the servicing of any Mortgage Loan (including but not limited to actions, suits or proceedings against Noteholders or
Certificateholders, or against the Depositor for breaches of representations and warranties) solely under the Indenture Trustee’s name, (iii) engage counsel to represent the Indenture Trustee in any action, suit or proceeding not directly
related to the servicing of any Mortgage Loan (including but not limited to actions, suits or proceedings against Noteholders or Certificateholders, or against the Depositor for breaches of 

  

 28 

 
representations and warranties, or (iv) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any
action with the intent to cause, and that actually causes, the Indenture Trustee to be registered to do business in any state. 
  
 (i) The Servicer shall give prompt notice to the Indenture Trustee of any action, of which the Servicer has actual knowledge, to (i)
assert a claim against the Issuer or (ii) assert jurisdiction over the Trust. 
  
 (j) Servicing Advances incurred by the Servicer in connection with the servicing of the Mortgage Loans (including any penalties in connection with the payment of any taxes and assessments or other charges) on any
Mortgaged Property shall be recoverable by the Servicer to the extent described herein. 
  
 (k) The Servicer shall be entitled to rely, and shall be fully protected in relying, upon any promissory note, writing, resolution,
notice, consent, certificate, affidavit, letter, e-mail, cablegram, telegram, telecopy, telex or teletype message, statement, order or other document reasonably believed by it to be genuine and correct and to have been signed, sent or made by the
proper person or persons and upon advice and statements of legal counsel (including, without limitation, counsel to the Mortgagor(s)), independent accountants and other experts selected by the Servicer. 
  
 (l) The Servicer shall have no liability to the Depositor,
the Sponsor, the Indenture Trustee, the Owner Trustee, any Noteholder or any other Person 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 the foregoing shall not apply to any breach of representations or warranties made by the Servicer herein, or to any specific liability imposed upon the Servicer pursuant to this Agreement or any liability that would otherwise be imposed upon
the Servicer by reason of its willful misconduct, bad faith or negligence in the performance of its duties hereunder or by reason of its failure to perform its obligations or duties hereunder. 
  
 (m) The Servicer further is authorized and empowered by the
Indenture Trustee, on behalf of the Noteholders and the Indenture Trustee, when the Servicer believes it is appropriate in its best judgment to register any Mortgage Loan on the MERS System, or cause the removal from the registration of any Mortgage
Loan on the MERS System, to execute and deliver, on behalf of the Indenture Trustee and the Noteholders or any of them, any and all instruments of assignment and other comparable instruments with respect to such assignment or re-recording of a
Mortgage in the name of MERS, solely as nominee for the Indenture Trustee and its successors and assigns. Any expenses incurred in connection with the actions described in the preceding sentence shall be reimbursable to the Servicer as Servicing
Advances. 
  
 Section 5.02. Collection of Certain Mortgage Loan
Payments; Collection Account. (a) The Servicer shall make reasonable efforts to collect all payments called for under the terms and provisions of the Mortgage Loans, and shall, to the extent such procedures shall be consistent with this
Agreement, follow Accepted Servicing Practices. Consistent with the foregoing, the Servicer may in its discretion waive any assumption fees or other fees which may be collected in the ordinary course of servicing such Mortgage Loans. 
  

 29 

 (b) The Servicer shall establish and maintain, in the name of the Indenture Trustee, a
segregated account (the “Collection Account”), in trust for the benefit of the Noteholders. The Collection Account shall be established and maintained as an Eligible Account. 
  
 (c) The Servicer shall deposit in the Collection Account any amounts representing Monthly Payments on the
Mortgage Loans due or to be applied as of a date after the Cut-Off Date on each Business Day, not more than two Business Days after the date of collection, the following payments and collections received or made by it (other than in respect of
monthly payments of principal on and interest of the Mortgage Loans that were due on or before the related Cut-Off Date and Monthly Payments due on August 1, 2005): 
  
 (i) payments of interest on the Mortgage Loans including Prepayment Charges; 
  
 (ii) payments of principal of the Mortgage Loans, including
Principal Prepayments; 
  
 (iii) the Loan
Repurchase Price of Mortgage Loans repurchased pursuant to Sections 2.06(b) or 4.02; 
  
 (iv) the Substitution Adjustment received in connection with Mortgage Loans for which Qualified Substitute Mortgage Loans are received
pursuant to Sections 2.06 and 4.02; 
  
 (v) all
Net REO Proceeds; 
  
 (vi) all Net Liquidation
Proceeds; and 
  
 (vii) all Insurance Proceeds
(including, for this purpose, any amounts required to be deposited by the Servicer pursuant to Section 5.04 hereof). 
  
 It is understood that the Servicer need not deposit amounts representing fees, late payment charges or extension or other administrative charges (other
than Prepayment Charges) payable by Mortgagors, or amounts received by the Servicer for the account of Mortgagors for application towards the payment of taxes, insurance premiums, assessments and similar items or foreclosure proceeds to the extent
payable to the related Mortgagor. 
  
 (d) The
Servicer shall invest any funds in the Collection Account in Permitted Investments, which shall mature not later than the Business Day next preceding the Servicer Remittance Date next following the date of such investment (except that any investment
held by the Indenture Trustee may mature on such Servicer Remittance Date) and shall not be sold or disposed of prior to its maturity. All net income and gain realized from any such investment shall be for the benefit of the Servicer and shall be
subject to its withdrawal or order on a Servicer Remittance Date. The Servicer shall deposit from its own funds the amount of any loss, to the extent not offset by investment income or earnings, in the Collection Account upon the realization of such
loss. 
  

 30 

 Section 5.03. Permitted Withdrawals from the Collection Account. The Servicer may make withdrawals
from the Collection Account, on or prior to any Servicer Remittance Date, for the following purposes: 
  
 (a) to pay to the Sponsor amounts received in respect of any Defective Mortgage Loan purchased or substituted for by the Sponsor to the
extent that the payment of any such amounts on the Servicer Remittance Date upon which the proceeds of such purchase are paid would make the total amount distributed in respect of any such Mortgage Loan on such Servicer Remittance Date greater than
the Loan Repurchase Price or the Substitution Adjustment therefor; 
  
 (b) to reimburse the Servicer for unreimbursed Delinquency Advances and unreimbursed Servicing Advances with respect to the Mortgage Loans for which it has made a Delinquency Advance or Servicing Advance, from late or
deferred payments collected, collections other than timely Monthly Payments, Liquidation Proceeds and/or the Loan Repurchase Price or Substitution Adjustment of or relating to such Mortgage Loans; 
  
 (c) to reimburse the Servicer for any Delinquency Advances
and Servicing Advances determined in good faith to have become Nonrecoverable Advances, such reimbursement to be made from any funds in the Collection Account; 
  

(d) to withdraw any amount received from a Mortgagor that is recoverable and sought to be recovered as a voidable preference by a
trustee in bankruptcy pursuant to the Bankruptcy Code in accordance with a final, nonappealable order of a court having competent jurisdiction; 
  
 (e) to withdraw any funds deposited in the Collection Account that were not required to be deposited therein; 
  
 (f) to pay the Servicer the Servicing Compensation pursuant
to Section 5.08 hereof to the extent not retained or paid; 
  
 (g) [Reserved]; 
  
 (h) without duplication, and solely out of amounts which are payable to a former servicer pursuant to Section 7.02(g), to pay to the Indenture Trustee or any successor servicer amounts paid by them in connection with the transfer of the
Servicer’s servicing obligations pursuant to Article VII hereof and required under such Article VII to be borne by the Servicer; 
  
 (i) to withdraw income on the Collection Account as provided in Section 5.02(d); and 
  
 (j) amounts deposited into the Collection Account in respect
of late fees, assumption fees and similar fees (other than Prepayment Charges). 
  

 31 

 The Servicer shall keep and maintain a separate accounting for each Mortgage Loan for the purpose of
accounting for withdrawals from the Collection Account pursuant to this Section 5.03. 
  
 Section 5.04. Hazard Insurance Policies; Property Protection Expenses. (a) The Servicer shall cause to be maintained with respect to each Mortgage Loan a hazard insurance policy with a carrier licensed in the
state in which the Mortgaged Property is located that provides for fire and extended coverage, and which provides for a recovery by the named insured of insurance proceeds relating to such Mortgage Loan in an amount not less than the least of (i)
the outstanding Principal Balance of the Mortgage Loan plus the outstanding principal balance of any mortgage loan senior to such Mortgage Loan, but in no event shall such amount be less than is necessary to prevent the Mortgagor from becoming a
coinsurer thereunder, (ii) the minimum amount required to compensate for loss or damage on a replacement cost basis and (iii) the full insurable value of the related Mortgage Property. The Servicer shall also maintain on property acquired upon
foreclosure, or by deed in lieu of foreclosure, hazard insurance with extended coverage in an amount which is at least equal to the lesser of (i) the maximum insurable value from time to time of the improvements which are a part of such property or
(ii) the sum of the Principal Balance of such Mortgage Loan and the principal balance of any mortgage loan senior to such Mortgage Loan at the time of such foreclosure plus accrued interest and the good-faith estimate of the Servicer of related
Liquidation Expenses to be incurred in connection therewith. Amounts collected by the Servicer under any such policies shall be deposited in the Collection Account to the extent that they constitute Liquidation Proceeds or Insurance Proceeds. Each
hazard insurance policy shall contain a standard mortgage clause naming the Servicer, its successors and assigns, as mortgagee. The Servicer shall be under no obligation to require that any Mortgagor maintain earthquake (except as provided herein)
or other additional insurance and shall be under no obligation itself to maintain any such additional insurance on property acquired in respect of a Mortgage Loan, other than pursuant to such applicable laws and regulations as shall at any time be
in force and as shall require such additional insurance. 
  
 (b) In the event that the Servicer shall obtain and maintain a blanket policy with an insurer which satisfies the corresponding requirements of Fannie Mae or Freddie Mac, insuring against fire, flood and hazards of
extended coverage on all of the Mortgage Loans, then, to the extent such policy names the Servicer as loss payee and provides coverage in an amount equal to the aggregate unpaid Principal Balance on the Mortgage Loans without co-insurance, and
otherwise complies with the requirements of this Section 5.04, the Servicer shall be deemed conclusively to have satisfied its obligations with respect to fire and hazard insurance coverage under this Section 5.04, it being understood and agreed
that such blanket policy may contain a deductible clause (payable by the Servicer), in which case the Servicer shall, in the event that there shall not have been maintained on the related Mortgaged Property a policy complying with the preceding
paragraph of this Section 5.04, and there shall have been a loss which would have been covered by such policy, deposit in the Collection Account from the Servicer’s own funds the difference, if any, between the amount that would have been
payable under a policy complying with the preceding paragraph of this Section 5.04 and the amount paid under such blanket policy. Upon the request of the Indenture Trustee, the Servicer shall cause to be delivered to the Indenture Trustee, a
certified true copy of such policy. 
  

 32 

 (c) If the Mortgage Loan at the time of origination relates to a Mortgaged Property in an
area identified in the Federal Register by the Federal Emergency Management Agency as having special flood hazards as designated to the Servicer by the Sponsor, the Servicer will cause to be maintained with respect thereto a flood insurance policy
in a form meeting the requirements of the current guidelines of the Federal Insurance Administration with a generally acceptable carrier in an amount representing coverage, and which provides for a recovery by the Servicer on behalf of the Issuer of
insurance proceeds relating to such Mortgage Loan of not less than the least of (i) the outstanding Principal Balance of the related Mortgage Loan, plus the principal balance of the related first lien, if any, (ii) the minimum amount required to
compensate for damage or loss on a replacement cost basis and (iii) the maximum amount of insurance that is available under the Flood Disaster Protection Act of 1973. The Servicer shall indemnify the Issuer out of the Servicer’s own funds for
any loss to the Issuer resulting from the Servicer’s failure to maintain the insurance required by this Section. 
  
 Section 5.05. Assumption and Modification Agreements. When a Mortgaged Property has been or is about to be conveyed by the Mortgagor, the Servicer
shall, to the extent it has knowledge of such conveyance or prospective conveyance, exercise its rights to accelerate the maturity of the related Mortgage Loan under any “due-on-sale” clause contained in the related Mortgage or Mortgage
Note; provided, however, that the Servicer shall not exercise any such right if (i) the “due-on-sale” clause, in the reasonable belief of the Servicer, is not enforceable under applicable law or (ii) the Servicer reasonably
believes that to permit an assumption of the Mortgage Loan would not materially and adversely affect the interest of the Noteholders. In such event, the Servicer shall enter into an assumption and modification agreement 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 law or the mortgage documents, the Mortgagor remains liable thereon. If the foregoing is not
permitted under applicable law, the Servicer is authorized 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. The Mortgage Loan, if assumed, shall conform in all respects to the requirements and representations and warranties of this Agreement. The Servicer shall notify the Indenture Trustee that any applicable
assumption or substitution agreement has been completed by forwarding to the Indenture Trustee the original copy of such assumption or substitution agreement, which copy shall be added by the Indenture Trustee to the related Indenture Trustee’s
Mortgage File and which shall, for all purposes, be considered a part of such Indenture Trustee’s Mortgage File to the same extent as all other documents and instruments constituting a part thereof. The Servicer shall be responsible for
promptly recording any such assumption or substitution agreements. In connection with any such assumption or substitution agreement, the required monthly payment on the related Mortgage Loan shall not be changed but shall remain as in effect
immediately prior to the assumption or substitution, the stated maturity or outstanding Principal Balance of such Mortgage Loan shall not be changed, the Mortgage Interest Rate shall not be changed nor shall any required monthly payments of
principal or interest be deferred or forgiven. Any fee collected by the Servicer for consenting to any such conveyance or entering into an assumption or substitution agreement shall be retained by or paid to the Servicer as additional servicing
compensation. 
  

 33 

 Notwithstanding the foregoing paragraph or any other provision of this Agreement, the Servicer shall not
be deemed to be in default, breach or any other violation of its obligations hereunder by reason of any assumption of a Mortgage Loan by operation of law or any assumption which the Servicer may be restricted by law from preventing, for any reason
whatsoever. 
  
 Section 5.06. Realization Upon Defaulted
Mortgage Loans. (a) The Servicer shall foreclose upon or otherwise comparably effect the ownership on behalf of the Issuer of Mortgaged Properties relating to defaulted Mortgage Loans as to which no satisfactory arrangements can be made for
collection of Delinquent payments and which the Sponsor has not purchased pursuant to Section 5.15, unless the Servicer reasonably believes that Net Liquidation Proceeds with respect to such Mortgage Loan would not be increased as a result of such
foreclosure or other action, in which case, such Mortgage Loan will be charged-off and will become a Liquidated Mortgage Loan. The Servicer shall have no obligation to purchase any Mortgaged Property at any foreclosure sale. In connection with such
foreclosure or other conversion, the Servicer shall exercise foreclosure procedures with the same degree of care and skill in their exercise or use, as it would ordinarily exercise or use under the circumstances in the conduct of their own affairs.
Any amounts including Liquidation Expenses, advanced by the Servicer in connection with such foreclosure or other action shall constitute Servicing Advances. 
  
 Pursuant to its efforts to sell any REO Property, the Servicer either itself or through an agent selected by the Servicer shall manage, conserve, protect
and operate 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 Servicer, rent the same, or any part
thereof, as the Servicer deems to be in the best interest of the Issuer for the period prior to the sale of such REO Property. The net income generated from the REO Property and the proceeds from a sale of any REO Property shall be deposited in the
Collection Account. 
  
 (b) If the Servicer has
reason to believe that a Mortgaged Property which the Servicer is contemplating acquiring in foreclosure or by deed in lieu of foreclosure contains environmental or hazardous waste risks known to the Servicer, the Servicer shall notify the Indenture
Trustee prior to acquiring the Mortgaged Property. The Servicer shall not institute foreclosure actions with respect to such a property if it reasonably believes that such action would not be consistent with the Accepted Servicing Practices, and in
no event shall the Servicer be required to manage, operate or take any other action with respect thereto which the Servicer in good faith believes will result in “clean-up” or other liability under applicable law, unless the Servicer
receives an indemnity acceptable to it in its sole discretion. 
  
 (c) The Servicer shall determine, with respect to each defaulted Mortgage Loan, when it has recovered, whether through trustee’s sale, foreclosure sale or otherwise, all amounts if any it expects to recover from
or on account of such defaulted Mortgage Loan, whereupon such Mortgage Loan shall become a Liquidated Mortgage Loan. 
  
 (d) Net Foreclosure Profits, if any, shall be paid directly to the Sponsor. 
  
 (e) With respect to its obligations under this Section 5.06, the Servicer shall take all such actions as it
reasonably believes are consistent with Accepted Servicing Practices. 
  

 34 

 Section 5.07. Indenture Trustee to Cooperate. (a) 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 shall deliver to the Indenture Trustee one copy of a Request for Release. Upon receipt of such copy of the
Request for Release, the Indenture Trustee shall promptly release the related Indenture Trustee’s Mortgage File, in trust to (i) the Servicer (ii) an escrow agent or (iii) any employee, agent or attorney of the Indenture Trustee, in each case
pending its release by the Servicer, such escrow agent or such employee, agent or attorney of the Indenture Trustee, as the case may be. Upon any such payment in full, or the receipt of such notification that such funds have been placed in escrow,
the Servicer is authorized to give, as attorney-in-fact for the Indenture Trustee and the mortgagee under the Mortgage which secured the Mortgage Note, an instrument of satisfaction (or assignment of Mortgage without recourse) regarding the
Mortgaged Property relating to such Mortgage, which instrument of satisfaction or assignment, as the case may be, shall be delivered to the Person or Persons entitled thereto against receipt therefor of payment in full, it being understood and
agreed that no expense incurred in connection with such instrument of satisfaction or assignment, as the case may be, shall be chargeable to the Collection Account. 
  
 (b) (i) From time to time and as appropriate in the servicing of any Mortgage Loan, including, without
limitation, foreclosure or other comparable conversion of a Mortgage Loan, the Indenture Trustee shall (except in the case of the payment or liquidation pursuant to which the related Indenture Trustee’s Mortgage File is released to an escrow
agent or an employee, agent or attorney of the Indenture Trustee), upon request of the Servicer and delivery to the Indenture Trustee of one copy of a Request for Release, release the related Indenture Trustee’s Mortgage File to the Servicer
and shall execute such documents as shall be necessary to the prosecution of any such proceedings, including, without limitation, an assignment without recourse of the related Mortgage to the Servicer. The Indenture Trustee shall complete in the
name of the Indenture Trustee any endorsement in blank on any Mortgage Note prior to releasing such Mortgage Note to the Servicer. Such receipt shall obligate the Servicer to return the Indenture Trustee’s Mortgage File to the Indenture Trustee
when the need therefor by the Servicer no longer exists unless the Mortgage Loan shall be liquidated, in which case, the Servicer shall deliver one copy of a Request for Release indicating such loan has been paid in full. 
  
 (ii) Each Request for Release may be delivered to the
Indenture Trustee (x) via mail or courier, (y) via facsimile or (z) by such other means, including, without limitation, electronic or computer readable medium, as the Servicer and the Indenture Trustee shall mutually agree. The Indenture Trustee
shall promptly release the related Indenture Trustee’s Mortgage File(s) within five (5) Business Days of receipt of one copy of a properly completed Request for Release pursuant to clauses (x), (y) or (z) above or such shorter period as may be
agreed upon by the Servicer and the Indenture Trustee. Receipt of a Request for Release pursuant to clauses (x), (y) or (z) above shall be authorization to the Indenture Trustee to release such Indenture Trustee’s Mortgage Files, provided the
Indenture Trustee has determined that such Request for Release has been executed, with respect to clauses (x) or (y) above, or approved, with respect to clause (z) above, by a Servicing Officer of the Servicer. If the Indenture Trustee is unable to
release the Indenture Trustee’s Mortgage Files within the time frames previously specified, the Indenture Trustee shall immediately notify the Servicer, 

  

 35 

 
indicating the reason for such delay, but in no event shall such notification be later than seven (7) Business Days after receipt of a Request for Release.
If the Servicer, is required to pay penalties or damages due solely to the Indenture Trustee’s negligent failure to release the related Indenture Trustee’s Mortgage File or the Indenture Trustee’s negligent failure to execute and
release documents in a timely manner, the Indenture Trustee shall be liable for such penalties or damages. 
  
 (c) No costs associated with the procedures described in this Section 5.07 shall be an expense of the Issuer or the Indenture Trustee and
the Indenture Trustee shall have no liability or obligation whatsoever to pay or advance any such amounts, except for any penalties and damages as set forth in Section 5.07(b)(ii) above. 
  
 Section 5.08. Servicing Compensation; Payment of Certain Expenses by Servicer. The Servicer shall be entitled to
receive and retain, out of collections on the Mortgage Loans for each Due Period, as servicing compensation for such Due Period, an amount (the “Servicing Fee”) equal to the product of one-twelfth of the Servicing Fee Rate and the
aggregate Stated Principal Balance of the Mortgage Loans in each Loan Group as of the beginning of such Due Period. Additional servicing compensation in the form of assumption fees, late payment charges or extension and other administrative charges
(other than Prepayment Charges) shall be retained by the Servicer. The Servicer shall be required to pay all expenses incurred by it in connection with its activities hereunder (including payment of all other fees and expenses not expressly stated
hereunder to be payable by or from another source) and shall not be entitled to reimbursement therefor except as specifically provided herein. 
  
 Section 5.09. Annual Statement as to Compliance. The Servicer will deliver to the Issuer, the Indenture Trustee, the Rating Agencies and the
Sponsor on or before March 15 of each year, beginning March 15, 2006, an Officer’s Certificate of the Servicer stating that (a) a review of the activities of the Servicer during the preceding calendar year and of its performance under this
Agreement has been made under such officer’s supervision and (b) to the best of such officer’s knowledge, based on such review, the Servicer has fulfilled all its material obligations under this Agreement throughout such year, or, if there
has been a default in the fulfillment of any such obligation, specifying each such default known to such officer and the nature and status thereof. 
  
 Section 5.10. Annual Independent Public Accountants’ Servicing Report. On or before March 15 of each year, beginning March 15, 2006, the
Servicer at its expense shall cause a firm of independent public accountants that is a member of the American Institute of Certified Public Accountants (who may also render other services to the Servicer) to furnish a report to the Issuer, the
Indenture Trustee, the Rating Agencies and the Sponsor to the effect that such firm has examined certain documents and records relating to the servicing of mortgage loans under servicing agreements (including this Agreement) substantially similar to
this Agreement, and that such examination, which has been conducted substantially in compliance with the Uniform Single Attestation Program for Mortgage Bankers or the Audit Guide for Audits of HUD Approved Nonsupervised Mortgagees (to the extent
that the procedures in such audit guide are applicable to the servicing obligations set forth in such agreements), has disclosed no items of noncompliance with the provisions of this Agreement which, in the opinion of such firm, are material, except
for such items of noncompliance as shall be set forth in such report. 
  

 36 

 Section 5.11. Access to Certain Documentation. The Servicer shall provide to the Indenture
Trustee, the FDIC and the supervisory agents and examiners (as required in the latter case by applicable State and federal regulations) of each of the foregoing access to the documentation regarding the Mortgage Loans, such access being afforded
without charge but only upon reasonable request and during normal business hours at the offices of the Servicer designated by it. 
  
 Upon any change in the format of the computer tape maintained by the Servicer in respect of the Mortgage Loans, the Servicer shall deliver a copy of such
computer tape to the Indenture Trustee and in addition shall provide a copy of such computer tape to the Indenture Trustee at such other times as the Indenture Trustee may reasonably request. 
  
 The Servicer shall keep confidential (including from affiliates thereof)
information concerning the Mortgage Loans, except as required by law. 
  
 Section 5.12. Maintenance of Fidelity Bond. The Servicer shall, during the term of its service as Servicer maintain in force a fidelity bond and errors and omissions insurance in respect of its officers, employees or agents. Such
bond and insurance shall comply with the requirements from time to time of Fannie Mae or Freddie Mac for Persons performing servicing for mortgage loans purchased by such association. 
  
 Section 5.13. Subservicing Agreements Between the Servicer and Subservicer and Subservicers. (a) The Servicer may
enter into subservicing agreements for any servicing and administration of Mortgage Loans with any institution which is in compliance with the laws of each state necessary to enable it to perform its obligations under such subservicing agreement.
The Servicer shall give notice to the Indenture Trustee of the appointment of any subservicer and shall furnish to the Indenture Trustee a copy of the subservicing agreement. The Servicer shall give notice to each Rating Agency of the appointment of
any subservicer. For purposes of this Agreement, the Servicer shall be deemed to have received payments on Mortgage Loans when any subservicer has received such payments. Any such subservicing agreement shall be consistent with and not violate the
provisions of this Agreement. 
  
 (b) The
Servicer may terminate any subservicing agreement in accordance with the terms and conditions of such subservicing agreement and thereafter directly service the related Mortgage Loans itself or enter into a subservicing agreement with a successor
subservicer that qualifies under Subsection (a) of this Section 5.13. The Servicer shall give notice to each Rating Agency of the termination of any subservicer and the appointment of any successor subservicer. 
  
 (c) The Servicer shall not be relieved of its obligations
under this Agreement notwithstanding any subservicing agreement or any of the provisions of this Agreement relating to agreements or arrangements between the Servicer and a subservicer or otherwise, and the Servicer shall be obligated to the same
extent and under the same terms and conditions as if it alone were servicing and administering the Mortgage Loans. The Servicer shall be entitled to enter into any agreement with a subservicer for indemnification of the Servicer by such subservicer
and nothing contained in such subservicing agreement shall be deemed to limit or 

  

 37 

 
modify this Agreement. The Issuer shall not indemnify the Servicer for any losses due to the Servicer’s negligence. 
  
 (d) Any subservicing agreement and any other transactions or
services relating to the Mortgage Loans involving a subservicer shall be deemed to be between the subservicer and the Servicer alone and the Indenture Trustee and the Noteholders shall not be deemed parties thereto and shall have no claims, rights,
obligations, duties or liabilities with respect to any Subservicer except as set forth in Subsection (e) of this Section 5.13 and the related Subservicing Agreement. 
  
 (e) Notwithstanding any contrary provision contained herein, in connection with the assumption of the
responsibilities, duties and liabilities and of the authority, power and rights of the Servicer hereunder by the Indenture Trustee or any other successor servicer pursuant to Section 7.02, it is understood and agreed that the Servicer’s rights
and obligations under any subservicing agreement then in force between the Servicer and a subservicer may be assumed or terminated (without cost) by the Indenture Trustee or any other successor servicer at its option as successor to the Servicer.

  
 The Servicer shall, upon request of the Indenture Trustee, but
at the expense of the Servicer, deliver to the assuming party documents and records relating to each subservicing agreement and an accounting of amounts collected and held by it and otherwise use its best reasonable efforts to effect the orderly and
efficient transfer of the subservicing agreements to the assuming party, without the payment of any fee by the Indenture Trustee, any Noteholders, notwithstanding any contrary provision in any subservicing agreement. 
  
 Section 5.14. Reports to the Indenture Trustee; Collection Account
Statements. Not later than twenty-five (25) days after each Payment Date, the Servicer shall provide to the Indenture Trustee a statement, certified by a Servicing Officer, setting forth the status of the Collection Account as of the close of
business on the last day of the Due Period preceding such Payment Date, stating that all payments required by this Agreement to be made by the Servicer on behalf of the Indenture Trustee have been made (or if any required payment has not been made
by the Servicer, specifying the nature and status thereof) and showing, for the period covered by such statement, the aggregate of deposits into and withdrawals from the Collection Account and the aggregate of deposits into the Payment Account as
specified in Section 6.01. Such statement shall also state the aggregate Stated Principal Balance and the aggregate unpaid principal balance of all the Mortgage Loans as of the close of business on the last day of the month preceding the month in
which such Payment Date occurs. 
  
 Section 5.15. Optional
Purchase of Defaulted Mortgage Loans. (a) The Depositor, in its sole discretion, shall have the right to elect (by written notice sent to the Servicer and the Indenture Trustee), but shall not be obligated, to purchase for its own account from
the Issuer any Mortgage Loan which is ninety (90) days or more Delinquent in the manner at the Loan Repurchase Price (except that the amount described in the definition of Loan Repurchase Price shall in no case be net of the Servicing Fee). The
purchase price for any Mortgage Loan purchased hereunder shall be deposited in the Collection Account and the Indenture Trustee, upon the Indenture Trustee’s receipt of written notice by the Servicer of such deposit, shall release or cause to
be released to the purchaser of such Mortgage Loan the related Indenture 

  

 38 

 
Trustee’s 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 Indenture 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 Indenture Trustee or the Noteholders with respect thereto. 
  
 (b) After the Depositor or its Affiliate has repurchased any Mortgage Loans which are 90 days or more Delinquent in an aggregate amount
equal to 1% of the Maximum Collateral Amount, then notwithstanding the foregoing, the Depositor or its Affiliate may only exercise its option pursuant to this Section 5.15 with respect to the Mortgage Loan or Mortgage Loans (including REO Mortgage
Loans) that have been Delinquent for the longest period at the time of such repurchase. 
  
 (c) The Depositor may not repurchase pursuant to this Section 5.15 more than 10% of the Mortgage Loans, measured by the outstanding
Principal Balance of the Mortgage Loans repurchased as a percentage of the Initial Pool Balance. 
  
 Section 5.16. Reports to be Provided by the Servicer. (a) By 3:00 p.m. eastern time on the second Business Day following the fifteenth (15th) day
of each month (the “Servicer Reporting Date”), the Servicer shall deliver to the Indenture Trustee, the Underwriter, Intex and Bloomberg a Servicer Remittance Report for the related Servicer Remittance Date in an electronic format
reporting on a loan-by-loan basis in such format as the Servicer and the Indenture Trustee may agree, and setting forth the following information with respect to all Mortgage Loans as well as a break out as to each Loan Group as of the close of
business on the last Business Day of the prior calendar month (except as otherwise provided in clause (v) below): 
  
 (i) the total number of Mortgage Loans and the Aggregate Principal Balances thereof, together with the number, Aggregate Principal
Balances of such Mortgage Loans and the percentage (based on the Aggregate Principal Balances of the Mortgage Loans) of the Aggregate Principal Balances of such Mortgage Loans to the Aggregate Principal Balance of all Mortgage Loans (A) 31-60 days
Delinquent, (B) 61-90 days Delinquent and (C) 91 or more days Delinquent; 
  
 (ii) the number, Aggregate Principal Balances of all Mortgage Loans and percentage (based on the Aggregate Principal Balances of the Mortgage Loans) of the Aggregate Principal Balances of such Mortgage Loans to the
Aggregate Principal Balance of all Mortgage Loans in foreclosure proceedings and the number, Aggregate Principal Balances of all Mortgage Loans and percentage (based on the Aggregate Principal Balances of the Mortgage Loans) of any such Mortgage
Loans also included in any of the statistics described in the foregoing clause (i); 
  
 (iii) the number, Aggregate Principal Balances of all Mortgage Loans and percentage (based on the Aggregate Principal Balances of the
Mortgage Loans) of 

  

 39 

 
the Aggregate Principal Balances of such Mortgage Loans to the Aggregate Principal Balance of all Mortgage Loans relating to Mortgagors in bankruptcy
proceedings and the number, Aggregate Principal Balances of all Mortgage Loans and percentage (based on the Aggregate Principal Balances of the Mortgage Loans) of any such Mortgage Loans also included in any of the statistics described in the
foregoing clause (i); 
  
 (iv) the number,
Aggregate Principal Balances of all Mortgage Loans and percentage (based on the Aggregate Principal Balances of the Mortgage Loans) of the Aggregate Principal Balances of such Mortgage Loans to the Aggregate Principal Balance of all Mortgage Loans
relating to REO Properties and the number, Aggregate Principal Balances of all Mortgage Loans and percentage (based on the Aggregate Principal Balances of the Mortgage Loans) of any such Mortgage Loans also included in any of the statistics
described in the foregoing clause (i); 
  
 (v)
the weighted average Mortgage Interest Rate for the Mortgage Loans in Loan Group I and Loan Group II, in each case, as of the Due Date occurring in the Due Period related to such Payment Date; 
  
 (vi) the weighted average remaining term to stated maturity
of all Mortgage Loans; 
  
 (vii) the book value
of any REO Property; 
  
 (viii) the Cumulative
Realized Loss Percentage and the Rolling Six Month Delinquency Ratio as of the related Payment Date; 
  
 (ix) with respect to each Monthly Payment, the amount of such remittance allocable to principal (including a separate breakdown of any
Principal Prepayment, including the date of such prepayment, and any Prepayment Charges); 
  
 (x) with respect to each Monthly Payment, the amount of such remittance allocable to interest; 
  
 (xi) the number and the Aggregate Principal Balance of
Mortgage Loans repurchased pursuant to Section 5.15; and 
  
 (xii) such other loan level information as either the Indenture Trustee may reasonably request to enable it to prepare the Indenture Trustee’s Remittance Report. 
  
 (b) [Reserved.] 
  
 (c) [Reserved.] 
  
 Section 5.17. [Reserved.] 
  
 Section 5.18. Delinquency Advances. If, on any Servicer Remittance
Date, the Servicer determines that any Monthly Payments due during the related Due Period have not been received as of the end of the related Due Period, the Servicer shall determine the amount of any 

  

 40 

 
Delinquency Advance required to be made with respect to the related Payment Date. The Servicer shall include in the amount to be deposited in the Payment
Account on such Servicer Remittance Date an amount equal to the Delinquency Advance, if any, which deposit may be made in whole or in part from funds in the Collection Account being held for future payment or withdrawal on or in connection with
Payment Dates in subsequent months, other than any such amounts which are voluntary Principal Prepayments in full. Any funds being held for future payment to Noteholders and so used shall be replaced by the Servicer from its own funds by deposit in
the Collection Account on or before the Business Day preceding any future Servicer Remittance Date to the extent that funds in the Collection Account on such Servicer Remittance Date shall be less than the Servicer Remittance Amount for such Payment
Date. 
  
 The Servicer shall designate on its records the specific
Mortgage Loans and related installments (or portions thereof) as to which such Delinquency Advance shall be deemed to have been made, such determination being conclusive for purposes of withdrawals from the Collection Account pursuant to Section
5.03 hereof. 
  
 Section 5.19. Indemnification; Third Party
Claims. The Servicer agrees to indemnify and to hold each of the Issuer, the Owner Trustee, the Depositor, the Sponsor, the Indenture Trustee and each Noteholder harmless against any and all claims, losses, penalties, fines, forfeitures, legal
fees and related costs, judgments, and any other costs, fees and expenses (including attorneys’ fees and expenses) that the Issuer, the Owner Trustee, the Depositor, the Sponsor, the Indenture Trustee and any Noteholder (or any director,
officer, employee or agent of the foregoing) may sustain in any way related to the failure of the Servicer to perform its duties and service the Mortgage Loans in compliance with the terms of this Agreement and the other Basic Documents and in
connection with the Indenture as provided in Section 6.16 thereof. Each indemnified party and the Servicer shall immediately notify the other indemnified parties if a claim is made by a third party with respect to this Agreement and the other Basic
Documents and the Servicer shall assume the defense of any such claim and pay all expenses in connection therewith, including reasonable counsel fees, and promptly pay, discharge and satisfy any judgment or decree which may be entered against the
Issuer, the Owner Trustee, the Depositor, the Sponsor, the Servicer, the Indenture Trustee and/or a Noteholder (or any director, officer, employee or agent of the foregoing) in respect of such claim. The obligations of the Servicer under this
Section 5.19 arising prior to any resignation or termination of the Servicer hereunder shall survive the resignation or termination of the Servicer or the termination of this Agreement or the Indenture. 
  
 Section 5.20. Maintenance of Corporate Existence and Licenses; Merger or
Consolidation of the Servicer. (a) The Servicer will keep in full effect its existence, rights and franchises as a corporation, will obtain and preserve its qualification to do business as a foreign corporation in each jurisdiction necessary to
protect the validity and enforceability of this Agreement or any of the Mortgage Loans and to perform its duties under this Agreement and will otherwise operate its business so as to cause the representations and warranties under Section 3.01 hereof
to be true and correct at all times under this Agreement. 
  
 (b) Any corporation into which the Servicer 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 Servicer shall be a
party, or any corporation succeeding to all or 

  

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substantially all of the business of the Servicer, shall be the successor of the Servicer, hereunder, without the execution or filing of any paper or any
further act on the part of any of the parties hereto provided that, such corporation meets the qualifications set forth in Section 7.02(b). The Servicer, as applicable, shall send notice of any such merger or consolidation to the Owner Trustee, the
Indenture Trustee and the Servicer, as applicable. 
  
 Section
5.21. Assignment of Agreement by Servicer; Servicer Not to Resign. The Servicer shall not assign this Agreement nor resign from the obligations and duties hereby imposed on it except upon the determination that the Servicer’s duties
hereunder are no longer permissible under applicable law and that such incapacity cannot be cured by the Servicer, without incurring unreasonable expense. Any such determination that the Servicer’s duties hereunder are no longer permissible
under applicable law permitting the resignation of the Servicer, as applicable, shall be evidenced by a written Opinion of Counsel (who may be counsel for the Servicer) to such effect delivered to the Indenture Trustee, the Issuer, the Depositor,
the Sponsor and the Servicer, as applicable. No such resignation of the Servicer shall become effective until a successor servicer appointed in accordance with the terms of this Agreement has assumed the Servicer’s responsibilities and
obligations hereunder in accordance with Section 7.02. The Servicer shall provide the Indenture Trustee and the Rating Agencies with 30 days’ prior written notice of its intention to resign pursuant to this Section 5.21. 
  
 Section 5.22. Periodic Filings with the Securities and Exchange Commission
Additional Information. 
  
 (a) The Indenture
Trustee shall reasonably cooperate with the Servicer in connection with the satisfaction of the reporting requirements under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Indenture Trustee shall prepare on
behalf of the Trust Fund any Forms 8-K and 10-K customary for similar securities as required by the Exchange Act and the Rules and Regulations of the Securities and Exchange Commission (the “Commission”) thereunder, and shall file (via the
Commission’s Electronic Data Gathering and Retrieval System) such Forms on behalf of the Servicer. The Servicer hereby grants to the Indenture Trustee a limited power of attorney to execute and file each such Form 8-K but only to the extent no
accompanying certification is required to be filed on behalf of the Servicer. Such power of attorney shall continue until the earlier of (i) receipt by the Indenture Trustee from the Servicer of written termination of such power of attorney and (ii)
termination of the Trust Fund. The Servicer shall execute the Form 10-Ks. The Indenture Trustee shall have no liability with respect to any failure to properly prepare or file such periodic reports resulting from or relating to the Indenture
Trustee’s inability or failure to obtain any information not resulting from its own negligence or willful misconduct. 
  
 (b) Each Form 8-K shall be filed by the Indenture Trustee within 15 days after each Payment Date, with a copy of the Indenture
Trustee’s Remittance Report for such Payment Date as an exhibit thereto. Prior to March 30th of each year (or such earlier date as may be required by the Exchange Act and the Rules and Regulations of the Commission) commencing with 2006, the
Indenture Trustee shall file a Form 10-K, in substance as required by applicable law or the Commission’s staff interpretations. Such Form 10-K shall include as exhibits the Servicer’s annual statement of compliance described under Section
5.09 and the accountant’s report described under Section 5.10, in each case to the extent they have been timely delivered to 

  

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the Indenture Trustee. If they are not so timely delivered, the Indenture Trustee shall file the incomplete Form 10-K, together with a Form 12b-25, and
thereafter shall file an amended Form 10-K including such documents as exhibits reasonably promptly after they are delivered to the Indenture Trustee. The Indenture Trustee shall have no liability with respect to any failure to properly prepare or
file such periodic reports resulting from or relating to the Indenture Trustee’s inability or failure to obtain any information not resulting from its own negligence or willful misconduct. The Form 10-K shall also include a certification in the
form attached hereto as Exhibit G (the “Certification”), which shall be signed by the senior officer of the Servicer in charge of securitization. The Indenture Trustee shall prepare and deliver each Form 10-K to the Servicer for
execution no later than March 20th of each year. The Servicer shall return the executed Form 10-K and the Certification to the Indenture Trustee for filing no later than March 25th of each year. 
  
 (c) The Servicer shall indemnify and hold harmless the
Indenture 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 Servicer’s obligations under this Section or the Sponsor’s negligence, bad faith or willful misconduct in connection therewith. 
  

(d) Upon any filing with the Commission, the Indenture Trustee shall promptly deliver to the Servicer a copy of any executed report,
statement or information. 
  
 (e) The Indenture
Trustee shall prepare and file a voluntary suspension of filing on Form 15 as soon as it is permitted to do so under the Exchange Act and the rules and regulations of the Commission. 
  
 Section 5.23. Administrative Duties. (a) Duties with Respect to the Basic Documents. The Servicer shall
perform all its duties and the duties of the Issuer under the Basic Documents. In addition, the Servicer shall consult with the Owner Trustee as the Servicer deems appropriate regarding the duties of the Issuer under the Basic Documents. The
Servicer shall monitor the performance of the Issuer and shall advise the Owner Trustee when action is necessary to comply with the Trust’s duties under the Basic Documents. The Servicer shall prepare for execution by the Issuer or shall cause
the preparation by other appropriate Persons of all such documents, reports, filings, instruments, certificates and opinions as it shall be the duty of the Issuer to prepare, file or deliver pursuant to the Basic Documents. In furtherance of the
foregoing, the Servicer shall take all necessary action that is the duty of the Issuer to take pursuant to the Basic Documents. 
  
 (b) Duties with Respect to the Issuer. In addition to the duties of the Servicer set forth in this Agreement or any of the Basic
Documents, the Servicer shall perform such calculations and shall prepare for execution by the Issuer or the Owner Trustee or shall cause the preparation by other appropriate Persons of all such documents, reports, filings, instruments, certificates
and opinions as it shall be the duty of the Issuer or the Owner Trustee to prepare, file or deliver pursuant to this Agreement or any of the Basic Documents or under state and federal tax and securities laws and shall take all appropriate action
that it is the duty of the Issuer to take pursuant to this Agreement or any of the Basic Documents. In accordance with the directions of the Issuer or the Owner Trustee, the Servicer shall administer, perform, or supervise the 

  

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performance of such other activities in connection with the Basic Documents as are not covered by any of the foregoing provisions and as are expressly
requested by the Issuer or the Owner Trustee and are reasonably within the capability of the Servicer. 
  
 In carrying out the foregoing duties under this Agreement, the Servicer may enter into transactions with or otherwise deal with any of its Affiliates;
provided, however, that the terms of any such transactions or dealings shall be in accordance with any directions received from the Issuer and shall be, in the Servicer’s opinion, no less favorable to the Issuer in any material respect.

  
 (c) Additional Information to be Furnished
to the Issuer. The Servicer shall furnish to the Owner Trustee from time to time such additional information regarding the Issuer or the Basic Documents as the Owner Trustee shall reasonably request. The Servicer shall prepare, execute and
deliver all certificates or other documents required to be delivered by the Issuer pursuant to the Sarbanes-Oxley Act of 2002 or the rules and regulations promulgated thereunder. 
  
 Section 5.24. Advance Facility. 
  
 (a) The Servicer on behalf of the Issuer, is hereby authorized to enter into a facility (such an
arrangement, an “Advance Facility”) with any Person which provides that such Person (an “Advancing Person”) may fund Delinquency Advances and/or Servicing Advances under this Agreement, although no such facility shall reduce or
otherwise affect the Servicer’s obligation to fund such Delinquency Advances and/or Servicing Advances. No consent of the Indenture Trustee, Noteholders or any other party shall be required before the Servicer may enter into an Advance Facility
nor shall the Indenture Trustee or the Noteholders be a third party beneficiary of any obligation of an Advancing Person to the Servicer. If the Servicer enters into an Advance Facility, the Servicer and the related Advancing Person shall deliver to
the Indenture Trustee at the address set forth in Section 10.06 hereof a written notice (an “Advance Facility Notice”), stating (a) the identity of the Advancing Person and (b) the identity of the Person (the “Servicer’s
Assignee”) that will, subject to Section 5.24(b) hereof, have the right to make withdrawals from the Collection Account pursuant to Section 5.03(b) hereof to reimburse previously unreimbursed Delinquency Advances and/or Servicing Advances
(“Advance Reimbursement Amounts”). If the Servicer enters into such an Advance Facility pursuant to this Section 5.24, upon reasonable request of the Advancing Person, the Indenture Trustee shall execute a letter of acknowledgment, as
prepared by the Servicer confirming its receipt of written notice of the existence of such Advance Facility. To the extent that an Advancing Person purchases or funds any Delinquency Advance or any Servicing Advance and provides the Indenture
Trustee with written notice acknowledged by the Servicer that such Advancing Person is entitled to reimbursement directly from the Indenture Trustee pursuant to the terms of the Advance Facility, such Advancing Person shall be entitled to receive
reimbursement pursuant to this Agreement for such amount to the extent provided in Section 5.24(b). Such notice from the Advancing Person must specify the amount of the reimbursement, the Section of this Agreement that permits the applicable
Delinquency Advance or Servicing Advance to be reimbursed and the section(s) of the Advance Facility that entitle the Advancing Person to request reimbursement from the Indenture Trustee, rather than the Servicer, and include the Servicer’s
acknowledgment thereto or proof of an Event of Default under the Advance Facility. The Indenture Trustee shall 

  

 44 

 
have no duty or liability with respect to any calculation of any reimbursement to be paid to an Advancing Person and shall be entitled to rely without
independent investigation on the Advancing Person’s notice provided pursuant to this Section 5.24. For the avoidance of doubt, an Advancing Person whose obligations under the Advance Facility are limited to the funding of Delinquency Advances
and/or Servicing Advances shall not be considered to be a subservicer hereunder. 
  
 (b) Notwithstanding the foregoing, and for the avoidance of doubt, (i) the Servicer and/or the Servicer’s Assignee shall only be
entitled to reimbursement of Delinquency Advance reimbursement amounts hereunder from withdrawals from the Collection Account pursuant to Section 5.03(b) and (c) of this Agreement and shall not otherwise be entitled to make withdrawals or receive
amounts that shall be deposited in the Payment Account, and (ii) none of the Indenture Trustee or the Noteholders shall have any right to, or otherwise be entitled to, receive any Delinquency Advance reimbursement amounts to which the Servicer or
Servicer’s Assignee, as applicable, shall be entitled pursuant to Section 5.03(b) and (c) hereof. An Advance Facility may be terminated by the joint written direction of the Servicer and the related Advancing Person. Written notice of such
termination shall be delivered to the Indenture Trustee in the manner set forth in Section 10.06 hereof. Neither the Issuer nor the Indenture Trustee shall, as a result of the existence of any Advance Facility, have any additional duty or liability
with respect to the calculation or payment of any Delinquency Advance reimbursement amount, nor, as a result of the existence of any Advance Facility, shall the Issuer or the Indenture Trustee have any additional responsibility to track or monitor
the administration of the Advance Facility or the payment of Delinquency Advance reimbursement amounts to the Servicer’s Assignee. The Servicer shall indemnify the Indenture Trustee, any successor Servicer and the Issuer for any claim, loss,
liability or damage resulting from any claim by the related Advancing Person, except to the extent that such claim, loss, liability or damage resulted from or arose out of negligence, recklessness or willful misconduct on the part of the Indenture
Trustee or any successor Servicer, as the case may be, or failure by the successor Servicer to remit funds as required by this Agreement or the commission of an act or omission to act by the successor Servicer and the passage of any applicable cure
or grace period, such that an Event of Default under this Agreement occurs or such entity is subject to termination for cause under this Agreement. The Servicer shall maintain and provide to any successor Servicer and, upon request, the Indenture
Trustee a detailed accounting on a loan-by-loan basis as to amounts advanced by, pledged or assigned to, and reimbursed to any Advancing Person. The successor Servicer and the Indenture Trustee, as applicable, shall be entitled to rely on any such
information provided by the predecessor Servicer, and the successor Servicer and the Indenture Trustee, as applicable, shall not be liable for any errors in such information. 
  
 (c) If an Advancing Person is entitled to reimbursement for any particular Delinquency Advance or Servicing
Advance as set forth in Section 5.24(a), then the Servicer shall not be permitted to reimburse itself therefor under Section 5.03(b) and (c), but instead the Servicer shall include such amounts in the applicable remittance to the Indenture Trustee
made pursuant to Section 5.02 to the extent of amounts on deposit in the Collection Account on the related Servicer Remittance Date. The Indenture Trustee is hereby authorized to pay to an Advancing Person reimbursements for Delinquency Advances and
Servicing Advances from the Payment Account to the same extent the Servicer would have been permitted to reimburse itself 

  

 45 

 
for such Delinquency Advances and/or Servicing Advances in accordance with Section 5.03(b) and (c), had the Servicer made such Delinquency Advance or
Servicing Advance. 
  
 (d) All Delinquency
Advances and Servicing Advances made pursuant to the terms of this Agreement shall be deemed made and shall be reimbursed on a “first in first out” (FIFO) basis. In the event the Servicer’s Assignee shall have received some or all of
an Delinquency Advance reimbursement amount related to Delinquency Advances and/or Servicing Advances that were made by a Person other than the Servicer or its related Advancing Person in error, then such Servicer’s Assignee shall be required
to remit any portion of such Delinquency Advance reimbursement amount to each Person entitled to such portion of such Delinquency Advance reimbursement amount. Without limiting the generality of the foregoing, the Servicer shall remain entitled to
be reimbursed pursuant to Section 5.03(b) and (c) for all Delinquency Advances and/or Servicing Advances funded by the Servicer to the extent the related Delinquency Advance reimbursement amounts have not been assigned, sold or pledged to such
Advancing Person or Servicer’s Assignee. 
  
 (e) In the event the Servicer is terminated pursuant to Section 7.01, the Advancing Person shall succeed to the terminated Servicer’s right of reimbursement set forth in Section 5.03(b) and (c) to the extent of such Advancing
Person’s financing of Delinquency Advances or Servicing Advances hereunder then remaining unreimbursed. 
  
 (f) Any amendment to this Section 5.24 or to any other provision of this Agreement that may be necessary or appropriate to effect the
terms of an Advance Facility as described generally in this Section 5.24, including amendments to add provisions relating to a successor Servicer, may be entered into by the Indenture Trustee, the Sponsor, the Depositor, the Issuer and the Servicer
without the consent of any Noteholder, provided such amendment complies with Section 10.03 hereof. All reasonable costs and expenses (including attorneys’ fees) of each party hereto of any such amendment shall be borne solely by the Servicer.
The parties hereto hereby acknowledge and agree that: (a) the Delinquency Advances and/or Servicing Advances financed by, sold and/or pledged to an Advancing Person under any Advance Facility are obligations owed to the Servicer payable only from
the cash flows and proceeds received under this Agreement for reimbursement of Delinquency Advances and/or Servicing Advances only to the extent provided herein, and the Indenture Trustee and the Issuer are not, as a result of the existence of any
Advance Facility, obligated or liable to repay any Delinquency Advances and/or Servicing Advances financed by the Advancing Person; (b) the Servicer will be responsible for remitting to the Advancing Person the applicable amounts collected by it as
reimbursement for Delinquency Advances and/or Servicing Advances purchased or funded by the Advancing Person, subject to the provisions of this Agreement; and (c) the Indenture Trustee shall not have any responsibility to track or monitor the
administration of the financing arrangement between the Servicer and any Advancing Person. 
  
 ARTICLE VI 
  
 APPLICATION OF FUNDS 
  
 Section 6.01. Deposits
to the Payment Account. By 12:00 noon (Eastern Time) on each Servicer Remittance Date, the Servicer shall remit to the Indenture Trustee for deposit in the 

  

 46 

 
Payment Account, from funds on deposit in the Collection Account, an amount equal to the Servicer Remittance Amount with respect to the related Payment Date,
minus any portion thereof payable to the Servicer pursuant to Section 5.03. 
  
 Section 6.02. Collection of Money. Except as otherwise expressly provided herein, the Indenture Trustee may demand payment or delivery of all money and other property payable to or receivable by the Indenture
Trustee pursuant to this Agreement, including all payments due on the Mortgage Loans in accordance with the respective terms and conditions of such Mortgage Loans and required to be paid over to the Indenture Trustee by the Servicer. The Indenture
Trustee shall hold all such money and property received by it, as part of the Trust Estate and shall apply it as provided in the Indenture. 
  
 Section 6.03. Application of Principal and Interest. In the event that Net Liquidation Proceeds on a Liquidated Mortgage Loan are less than the
Principal Balance of the related Mortgage Loan plus accrued interest thereon, or any Mortgagor makes a partial payment of any Monthly Payment due on a Mortgage Loan, such Net Liquidation Proceeds or partial payment shall be applied to payment of the
related Mortgage Note as provided therein, and if not so provided, first to interest accrued at the Mortgage Interest Rate and then to principal. 
  
 Section 6.04. [Reserved.] 
  
 Section 6.05. Compensating Interest. Not later than the Servicer Remittance Date, the Servicer shall remit to the Indenture Trustee (without right
to reimbursement therefor) for deposit into the Payment Account, an amount equal to, for all of the Mortgage Loans, the lesser of (a) the Prepayment Interest Shortfalls for all of the Mortgage Loans for the related Payment Date resulting from
Principal Prepayments in full during the related Prepayment Period and (b) its aggregate Servicing Fee with respect to all of the Mortgage Loans for the related Due Period (the “Compensating Interest”). 
  
 ARTICLE VII 
  
 SERVICER DEFAULT 
  
 Section 7.01. Servicer Events of Default. (a) The following events
shall each constitute a “Servicer Event of Default” hereunder: 
  
 (i) any failure by the Servicer to remit to the Indenture Trustee any payment required to be made by the Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii) below and
Delinquency Advances, which shall have no cure period), which continues unremedied for one (1) Business Day after the date upon which notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Indenture
Trustee or to the Servicer and Indenture Trustee by the Noteholders affected thereby evidencing Percentage Interests of at least 25%; provided however that any failed remittance cured within one Business Day of such failure shall include interest
accrued at the Prime Rate (as set forth in the Wall Street Journal) on the amount of such remittance from and including the date the remittance was required to be made to and including the date the remittance was actually made; 
  

 47 

 (ii) the failure by the Servicer to make any required Servicing Advance, which failure
continues unremedied for a period of thirty (30) days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Indenture Trustee or to the Servicer and the Indenture
Trustee by the Noteholders affected thereby evidencing Percentage Interests of at least 25%; 
  
 (iii) any failure on the part of the Servicer duly 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, or the failure of any representation and warranty made pursuant to Section 3.01(a) hereof to be true and correct which continues unremedied for a period of thirty (30) days after the date on
which written notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the Indenture Trustee or to the Servicer and the Indenture Trustee by the Noteholders affected thereby evidencing Percentage Interests
of at least 25%; 
  
 (iv) a decree or order of a
court or agency or supervisory authority having jurisdiction in an involuntary case under any present or future federal or state bankruptcy, insolvency or similar law or for the appointment of a conservator or receiver or liquidation 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 ninety (90) days; 
  
 (v) the Servicer shall consent to the appointment of a conservator or receiver or liquidator in any insolvency, readjustment of debt, marshalling of assets and liabilities or similar proceedings of or relating to the
Servicer or of or relating to all or substantially all of the Servicer’s property; 
  
 (vi) the Servicer shall admit in writing its inability generally to pay its debts as they become due, file a petition to take advantage of
any applicable insolvency or reorganization statute, make an assignment for the benefit of its creditors, or voluntarily suspend payment of its obligations; 
  
 (vii) if on any Payment Date the Rolling Six Month Delinquency Ratio exceeds 17%; 
  
 (viii) if on any Payment Date, the Cumulative Realized Loss
Percentage exceeds the following percentages on any Payment Date during the following periods: 
  

				
	 Payment Date Occurring During

	  	Percentage

	 
	 September 2008 - August 2009
	  	6.50	%
	 September 2009 - August 2010
	  	7.00	%
	 September 2010 - August 2011
	  	7.50	%
	 September 2011 and thereafter
	  	8.00	%

  
 (ix)
the occurrence of an Event of Default under the Indenture. 
  

 48 

 So long as a Servicer Event of Default shall have occurred and not have been remedied: (x) with respect
solely to Section 7.01(a)(i), if such payment is in respect of Delinquency Advances or Compensating Interest owing by the Servicer and such payment is not made by 12:00 noon New York time on the second Business Day prior to the applicable Payment
Date, the Indenture Trustee, upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee of such failure, shall give immediate telephonic and facsimile notice of such failure to a Servicing Officer of the
Servicer and the Indenture Trustee may, and upon request of the Holders representing more than 50% of the Class Note Balance, shall, terminate all of the rights and obligations of the Servicer under this Agreement, except for the Servicer’s
indemnification obligation under Section 5.19, and the Indenture Trustee (if it is the successor servicer) or a successor servicer appointed in accordance with Section 7.02, shall immediately make such Delinquency Advance or payment of Compensating
Interest as provided in Section 7.02 and assume, pursuant to Section 7.02 hereof, the duties of a successor servicer; (y) with respect to that portion of Section 7.01(a)(i) not referred to in the preceding clause (x) and with respect to clauses
(ii), (iii), (iv), (v), (vi) and (xii) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee shall, but only at the direction of the Majority Noteholders, by
notice in writing to the Servicer and a Responsible Officer of the Indenture Trustee, and in addition to whatever rights such Noteholders may have at law or equity to damages, including injunctive relief and specific performance, terminate all the
rights and obligations of the Servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer; and (z) with respect to clauses
(vii)-(ix) of Section 7.01(a), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture Trustee shall, after notice in writing to the Servicer and a Responsible Officer of the Indenture
Trustee, terminate all the rights and obligations of the Servicer under this Agreement, except for the Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Servicer. Upon
receipt by the Servicer of such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Mortgage Loans or otherwise, shall, subject to Section 7.02, pass to and be vested in another successor
servicer, and another successor servicer is hereby authorized and empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, at the expense of the Servicer, any and all documents and other instruments and do or
cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, including, but not limited to, the transfer and endorsement or assignment of the Mortgage Loans and related documents. The
Servicer agrees to cooperate (and to pay any related costs and expenses) with the Indenture Trustee or another successor servicer in effecting the termination of the Servicer’s responsibilities and rights hereunder, including, without
limitation, the transfer to another successor servicer, for administration by it of all amounts which shall at the time be credited by the Servicer to the Collection Account or thereafter received with respect to the Mortgage Loans. The Indenture
Trustee shall promptly notify the Rating Agencies and the Swap Provider of the occurrence of a Servicer Event of Default upon discovery or receipt of notice by a Responsible Officer of the Indenture Trustee; provided, however, the Indenture Trustee
shall not be obligated to monitor the Servicer’s compliance with the terms hereof or to determine the occurrence of any Servicer Event of Default. 
  

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 Section 7.02. Indenture Trustee to Act: Appointment of Successor. (a) (i) On and after the time
the Servicer receives a notice of termination pursuant to Section 7.01, or the Indenture Trustee receives the resignation of the Servicer evidenced by an Opinion of Counsel pursuant to Section 5.21, or the Servicer is removed as Servicer pursuant to
this Article VII, in which event the Indenture Trustee shall promptly notify the Rating Agencies, and except as otherwise provided in this Section 7.02, the Indenture Trustee (provided the Indenture Trustee receives 20 days’ prior written
notice) or another successor servicer shall be the successor in all respects to the Servicer in its capacity as servicer under this Agreement and the transactions set forth or provided for in this Agreement, and shall be subject to all the
responsibilities, restrictions, duties, liabilities and termination provisions relating thereto placed on the Servicer by the terms and provisions of this Agreement. The Indenture Trustee or another successor servicer shall take such action,
consistent with this Agreement, as shall be necessary to effect any such succession. If the Indenture Trustee or any other successor servicer is acting as Servicer hereunder, it shall be subject to termination under Section 7.01 upon the occurrence
or continuation of a Servicer Event of Default applicable to it as Servicer. The Indenture Trustee hereby agrees to act as successor servicer pursuant to the terms of this Agreement upon the termination or resignation of the Servicer as provided in
this Section 7.02, provided that the Indenture Trustee receives all of the necessary documents relating to the Mortgage Loans and computer records reflecting the status of the Mortgage Loans as of the date of such transfer of servicing. The
Indenture Trustee and any successor servicer will not be obligated to incur any expenses or costs (including, without limitation, legal fees and the preparation and recording of all intervening assignments of mortgage) in connection with the
transfer of servicing of the Mortgage Loans to the Indenture Trustee, as successor servicer, or any other successor servicer, as applicable, or to compel the performance of any obligations by any party to this Agreement. Any successor servicer and
the Indenture Trustee prior to its becoming the successor servicer shall not be liable for any actions, omissions or defaults of any servicer prior to it or breaches of representations and warranties of the servicer prior to it. The Indenture
Trustee or any other successor servicer, as successor servicer, shall be obligated to pay Compensating Interest pursuant to Section 6.05 in any event and to make Delinquency Advances pursuant to Section 5.18 unless, and only to the extent the
successor servicer determines reasonably and in good faith that such advances would not be recoverable from the proceeds of the related Mortgage Loan pursuant to Section 5.03, such determination to be evidenced by a certification of a Responsible
Officer of the successor servicer delivered to the Indenture Trustee. Furthermore, neither the Indenture Trustee nor any successor servicer shall be obligated to fund any resulting discrepancy or shortfall in the Collection Account. Upon the
transfer of the servicing of the Mortgage Loans, the Indenture Trustee shall provide the successor servicer with an officer’s certificate that contains: (i) a complete description of all Events of Default by the Servicer under the Agreement of
which a Responsible Officer of the Indenture Trustee has actual knowledge, which have not been fully cured and (ii) confirmation that the Servicer Remittance Report and the reports described in Sections 5.09 and 5.10 have been timely filed by the
Servicer with the Indenture Trustee. 
  
 (ii) In
the event that any successor servicer is terminated or resigns pursuant to this Agreement or otherwise becomes unable to perform its obligations under this Agreement, the Indenture Trustee will appoint a successor servicer in accordance with the
provisions of this Section 7.02; provided, that any successor servicer, shall satisfy the requirements set forth in Section 7.02(b) and shall be approved by the Rating Agencies. 
  

 50 

 (b) Any successor servicer hereunder (other than the Indenture Trustee) shall be a
housing and home finance institution, bank or mortgage servicing institution which has been designated as an approved seller-servicer by Fannie Mae or Freddie Mac, having equity of not less than $5,000,000 as determined in accordance with GAAP, as
the successor to the Servicer hereunder in the assumption of all or any part of the responsibilities, duties or liabilities of the Servicer hereunder. 
  
 (c) In the event the Indenture Trustee is the successor servicer, it shall be entitled to the same Servicing Compensation (including the
Servicing Fee as adjusted pursuant to the definition thereof) and other funds pursuant to Section 5.08 hereof as the Servicer if the Servicer had continued to act as servicer hereunder. 
  
 (d) The Indenture Trustee and any successor servicer shall take such action, consistent with this Agreement,
as shall be necessary to effectuate any such succession. The Servicer agrees to cooperate with the Indenture Trustee and any successor servicer in effecting the termination of the Servicer’s servicing responsibilities and rights hereunder and
shall promptly provide the Indenture Trustee, or such successor servicer, as applicable, at the Servicer’s cost and expense, all documents and records reasonably requested by it to enable it to assume the Servicer’s functions hereunder and
shall promptly also transfer to the Indenture Trustee, or such successor servicer, as applicable, all amounts that then have been or should have been deposited in the Collection Account by the Servicer or that are thereafter received with respect to
the Mortgage Loans, including without limitation all Liquidation Proceeds and Insurance Proceeds, and payments of insurance deductible amounts by the Servicer pursuant to Section 5.04(b) with respect to all insurance claims arising during the
Servicer’s tenure. Any collections received by the Servicer after such removal or resignation shall be endorsed by it to the Indenture Trustee or a successor servicer, as applicable, and remitted directly to the Indenture Trustee (or, at the
direction of the Indenture Trustee, to any other successor servicer). Neither the Indenture Trustee nor any other successor servicer shall be held liable by reason of any failure to make, or any delay in making, any payment hereunder or any portion
thereof caused by (i) the failure of the Servicer to deliver, or any delay in delivering, cash, documents or records to it, or (ii) restrictions imposed by any regulatory authority having jurisdiction over the Servicer hereunder. The Servicer shall
not resign as Servicer until a successor servicer has been appointed. 
  
 (e) In the event that the Servicer is terminated hereunder and no successor servicer has been appointed hereunder, the Indenture Trustee may appoint a successor servicer (which may be an affiliate of the Indenture
Trustee) or petition a court of competent jurisdiction to appoint a successor servicer. Pending appointment of such a successor servicer hereunder, the Indenture Trustee shall be the successor servicer and act in such capacity; provided, however,
that the Indenture Trustee, in its capacity as successor servicer pending appointment of another successor servicer, (i) shall be obligated to make Delinquency Advances or Servicing Advances only to the extent that the Indenture Trustee deems such
advances to be recoverable, (ii) shall be obligated to make Compensating Interest payments in respect of any Payment Date only to the extent of any Servicing Fee received by the Indenture Trustee in respect of such Payment Date, (iii) shall not be
obligated to perform any other duties or obligations of the Servicer hereunder until the Indenture Trustee has received all servicing records and files from the predecessor servicer and in no event later than 90 days following the termination of the
Servicer; provided, 

  

 51 

 
however, the Indenture Trustee shall use its reasonable efforts to perform the duties and obligations of the Servicer prior to the end of such 90 day period,
(iv) shall not be obligated to perform any of the administrative duties specified in Section 5.23 hereof, and (v) shall be entitled to payment of all Servicing Compensation. In connection with any appointment and assumption of duties of a successor
servicer, the Indenture Trustee may make such arrangements for the compensation of such successor servicer out of payments on Mortgage Loans; provided, however, that such compensation may not be in excess of that permitted the Servicer pursuant to
Section 5.08, together with other Servicing Compensation. The Servicer, the Indenture Trustee and such successor Servicer shall take such action, consistent with this Agreement, as shall be necessary to effectuate any such succession. 
  
 (f) In the event the Indenture Trustee, or any successor
servicer incurs out-of-pocket expenses other than Servicing Advances or Delinquency Advances in connection with the transfer of servicing hereunder, which expenses are required to be borne by the Servicer hereunder, and such expenses are not
promptly reimbursed by the Servicer or recoverable out of amounts reimbursable to the Servicer out of the Collection Account, the Indenture Trustee shall make such reimbursement to the applicable party out of funds in the Payment Account on any
Payment Date after all Payments to Noteholders on such Payment Date have been made but before any distribution to the Certificateholders. The right of the Indenture Trustee to reimbursement from the Payment Account for any of the Indenture
Trustee’s costs and expenses in connection with the transfer of any servicing hereunder shall be in addition to any rights of the Indenture Trustee to indemnification and reimbursement under the Indenture. 
  
 (g) In the event that the Servicer is terminated or resigns
hereunder, and at such time the Servicer has made unreimbursed Delinquency Advances or Servicing Advances out of its own funds, 
  
 (i) any such Delinquency Advances or Servicing Advances shall be allocated by the successor servicer in whole or in part to specific
Mortgage Loans which are delinquent at the time of the transfer of servicing, which allocation shall be based on loan-level accounts of the portion of each Delinquency Advance or Servicing Advance which has been funded by the Servicer from its own
funds consistently maintained by the former Servicer, or, if no such accounts exist, then in the successor servicer’s discretion; 
  
 (ii) following the transfer of servicing, the successor servicer shall reimburse the former Servicer for such Delinquency Advances and
Servicing Advances in accordance with the allocations determined in accordance with clause (i) above only out of the proceeds of the Mortgage Loans to which they relate and otherwise subject to Section 5.03, or, to the extent the successor servicer
determines any such Delinquency Advance or Servicing Advance to be a Nonrecoverable Advance, out of any funds in the Collection Account. 
  
 (h) In connection with the termination or resignation of the Servicer hereunder, the successor Servicer shall represent and warrant that
it is a member of MERS in good standing and shall agree to comply in all material respects with the rules and procedures of MERS in connection with the servicing of the Mortgage Loans that are registered with MERS, in which case the predecessor
Servicer shall cooperate with the successor Servicer in causing the 

  

 52 

 
MERS System to be revised to reflect the transfer of servicing to the successor Servicer as necessary under MERS’ rules and regulations. 
  
 Section 7.03. Waiver of Defaults. The Majority Noteholders may, on
behalf of all Noteholders, waive any events permitting removal of the Servicer as servicer pursuant to this Article VII; provided, however, that the Majority Noteholders may not waive a default in making a required payment on a Note
without the consent of the Holder of such Note. Upon any waiver of a past default, such default shall cease to exist, and any Servicer Event of Default arising therefrom shall be deemed to have been remedied for every purpose of this Agreement. No
such waiver shall extend to any subsequent or other default or impair any right consequent thereto except to the extent expressly so waived. Notice of any such waiver shall be given by the Indenture Trustee to the Rating Agencies. 
  
 ARTICLE VIII 
  
 TERMINATION 
  
 Section 8.01. Termination. (a) Subject to Section 8.02, this Agreement
shall terminate upon notice to the Indenture Trustee of either: (i) the disposition of all funds with respect to the last Mortgage Loan and the remittance of all funds due hereunder and the payment of all amounts due and payable to the Indenture
Trustee or (ii) mutual consent of the Owner Trustee, on behalf of the Issuer, at the direction of all the Certificateholders, the Indenture Trustee, the Servicer, the Swap Provider (if the Swap Agreement is still outstanding) and all Noteholders in
writing. 
  
 (b) In addition, subject to Section
8.02, the Sponsor may, at its sole option, cost and expense, terminate the Issuer in accordance with the terms of Section 10.01 of the Indenture. 
  
 (c) If on any date, the Servicer determines that there are no outstanding Mortgage Loans and no other funds or assets in the Trust Estate
other than funds in the Payment Account, the Servicer shall send a final payment notice promptly to the Indenture Trustee, who shall forward notice to each Noteholder in accordance with Section 8.01(d). 
  
 (d) Notice of any termination, specifying the Payment Date
upon which the Issuer will terminate and the Noteholders shall surrender their Notes to the Indenture Trustee for final payment and cancellation, shall be given promptly by the Servicer to the Indenture Trustee, who shall forward the notice by
letter to Noteholders mailed during the month of such final payment before the Servicer Remittance Date in such month, specifying (i) the Payment Date upon which final payment of the Notes will be made upon presentation and surrender of Notes at the
office of the Indenture Trustee therein designated, (ii) the amount of any such final payment and (iii) that the Record Date otherwise applicable to such Payment Date is not applicable, payments being made only upon presentation and surrender of the
Notes at the office of the Indenture Trustee therein specified. 
  
 (e) In the event that all of the Noteholders do not surrender their Notes for cancellation within six (6) months after the time specified in the above-mentioned written notice, 

  

 53 

 
the Indenture Trustee shall give a second written notice to the remaining Noteholders to surrender their Notes for cancellation and receive the final payment
with respect thereto. If within six (6) months after the second notice, all of the Notes shall not have been surrendered for cancellation, the Indenture Trustee may take appropriate steps, or may appoint an agent to take appropriate steps, to
contact the remaining Noteholders concerning surrender of their Notes and the cost thereof shall be paid out of the funds and other assets which remain subject hereto. If within nine (9) months after the second notice all the Notes shall not have
been surrendered for cancellation, the Certificateholders shall be entitled to all unclaimed funds and other assets which remain subject hereto and the Indenture Trustee upon transfer of such funds shall be discharged of any responsibility for such
funds and the Noteholders shall look only to the Certificateholders for payment. Such funds shall remain uninvested. 
  
 Section 8.02. Additional Termination Requirements. By their acceptance of the Notes, the Holders thereof hereby agree to appoint the Servicer as
their attorney in fact to: (i) adopt a plan of complete liquidation (and the Noteholders hereby appoint the Indenture Trustee as their attorney in fact to sign such plan) as appropriate and (ii) to take such other action in connection therewith as
may be reasonably required to carry out such plan of complete liquidation all in accordance with the terms hereof. 
  
 Section 8.03. Accounting Upon Termination of Servicer. Upon termination of the Servicer, the Servicer shall, at its expense: 
  
 (a) deliver to the successor servicer or, if none shall yet
have been appointed, to the Indenture Trustee, the funds in any Account administered by the Servicer; 
  
 (b) deliver to the successor servicer or, if none shall yet have been appointed, to the Indenture Trustee all Mortgage Files and related
documents and statements held by it hereunder and a Mortgage Loan portfolio computer tape; 
  
 (c) deliver to the successor servicer, or, if none shall yet have been appointed, to the Indenture Trustee a full accounting of all funds,
including a statement showing the Monthly Payments collected by it and a statement of monies held in trust by it for the payments or charges with respect to the Mortgage Loans; and 
  
 (d) execute and deliver such instruments and perform all acts reasonably requested in order to effect the
orderly and efficient transfer of servicing of the Mortgage Loans to the successor servicer and to more fully and definitively vest in such successor all rights, powers, duties, responsibilities, obligations and liabilities of the Servicer under
this Agreement. 
  

 54 

 ARTICLE IX 
  

[RESERVED] 
  
 ARTICLE X 
  
 MISCELLANEOUS PROVISIONS 
  
 Section 10.01.
Limitation on Liability. (a) None of the Issuer, the Owner Trustee, the Depositor, the Sponsor, the Servicer, the Indenture Trustee or any of the directors, officers, employees or agents of such Persons shall be under any liability to the
Issuer, the Noteholders 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 Issuer,
the Owner Trustee, the Depositor, the Sponsor, the Servicer, the Indenture Trustee or any such Person against liability for any breach of warranties or representations made herein by such party, or against any specific liability imposed on each such
party pursuant to this Agreement or against any liability which would otherwise be imposed upon such party by reason of willful misfeasance, bad faith or negligence in the performance of duties or by reason of failure to perform its obligations or
duties hereunder. The Issuer, the Owner Trustee, the Depositor, the Sponsor, the Servicer, the Indenture Trustee and any director, officer, employee or agent of such Person may rely in good faith on any document of any kind which, prima facie, is
properly executed and submitted by any appropriate Person respecting any matters arising hereunder. 
  
 (b) It is expressly understood and agreed by the parties hereto that (i) this Agreement is executed and delivered by U.S. Bank Trust
National Association, not individually or personally but solely as Owner Trustee under the Trust Agreement, in the exercise of the powers and authority conferred and vested in it under the Trust Agreement, (ii) each of the representations,
undertakings and agreements herein made on the part of the Issuer is made and intended not as personal representations, undertakings and agreements by U.S. Bank Trust National Association but is made and intended for the purpose for binding only the
Issuer, (iii) nothing herein contained shall be construed as creating any liability on U.S. Bank Trust National Association, individually or personally, to perform any covenant either expressed or implied contained herein, all such liability, if
any, being expressly waived by the parties hereto and by any Person claiming by, through or under the parties hereto and (iv) under no circumstances shall U.S. Bank Trust National Association be personally liable for the payment of any indebtedness
or expenses of the Issuer or be liable for the breach or failure of any obligation, representation, warranty or covenant made or undertaken by the Issuer under this Agreement or any other related documents. 
  
 Section 10.02. Acts of Noteholders. (a) Subject to Section 7.04 and
except as otherwise specifically provided herein, whenever Noteholder action, consent or approval is required under this Agreement, such action, consent or approval shall be deemed to have been taken or given on behalf of, and shall be binding upon,
all Noteholders if the Majority Noteholders agree to take such action or give such consent or approval. 
  
 (b) The death or incapacity of any Noteholder shall not operate to terminate this Agreement or the Issuer, nor entitle such
Noteholder’s legal representatives or heirs to claim 

  

 55 

 
an accounting or to take any action or proceeding in any court for a partition or winding up of the Issuer, nor otherwise affect the rights, obligations and
liabilities of the parties hereto or any of them. 
  
 (c) No Noteholder shall have any right to vote (except as expressly provided for herein) or in any manner otherwise control the operation and management of the Issuer, or the obligations of the parties hereto, nor shall anything herein set
forth, or contained in the terms of the Notes, be construed so as to constitute the Noteholders from time to time as partners or members of an association; nor shall any Noteholder be under any liability to any third person by reason of any action
taken by the parties to this Agreement pursuant to any provision hereof. 
  
 Section 10.03. Amendment. (a) This Agreement may be amended from time to time by the Owner Trustee, on behalf of the Issuer, the Servicer, the Depositor, Sponsor and the Indenture Trustee by written agreement,
without notice to or consent of the Noteholders and without the consent of the Swap Provider to cure any ambiguity, to correct or supplement any provisions herein, to comply with any changes in the Code, or to make any other provisions with respect
to matters or questions arising under this Agreement which shall not be inconsistent with the provisions of this Agreement; provided, however, that such action shall not adversely affect in any material respect the interests of any
Noteholder or the Swap Provider and will not prevent the Notes from being characterized as debt for United States federal income tax purposes or cause the Issuer to be subject to federal income tax, as evidenced by (i) an Opinion of Counsel, at the
expense of the party requesting the change, delivered to the Indenture Trustee to such effect or (ii) a letter from each Rating Agency confirming that such action will not result in the reduction, qualification or withdrawal of the then-current
ratings on the Notes. The Indenture Trustee shall give prompt written notice to the Rating Agencies and the Swap Provider of any amendment made pursuant to this Section 10.03. 
  
 (b) This Agreement may be amended from time to time by the Owner Trustee, on behalf of the Issuer, the
Servicer, the Depositor, the Sponsor and the Indenture Trustee, with the consent of the Noteholders representing more than 50% of the outstanding Principal Balance of the Notes of each affected Class and all of the Certificateholders and with the
consent of the Swap Provider (if the Swap Agreement is still outstanding and affected); provided, however, that no such amendment shall reduce in any manner the amount of, or delay the timing of, payments received on Mortgage Loans
which are required to be paid on any Class of Notes without the consent of the Holders of such Class of Notes or reduce the percentage for the Holders of which are required to consent to any such amendment without the consent of the Holders of 100%
of such Class of Notes affected thereby. 
  
 (c)
It shall not be necessary for the consent of Holders under this Section 10.03 to approve the particular form of any proposed amendment, but it shall be sufficient if such consent shall approve the substance thereof. 
  
 (d) In executing, or accepting the additional trusts created
by, any supplemental indenture permitted by Article IX of the Indenture or the modifications thereby of the trusts created by the Indenture, the Indenture Trustee shall be entitled to receive, and (subject to Section 6.01 of the Indenture) shall be
fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by the 

  

 56 

 
Indenture. The Indenture Trustee may, but shall not be obligated to, enter into any such supplemental indenture that affects the Indenture Trustee’s own
rights, duties or immunities under the Indenture or otherwise. The Servicer, on behalf of the Issuer, shall cause executed copies of any supplemental indentures to be delivered to the Rating Agencies. 
  
 Section 10.04. Recordation of Agreement. To the extent permitted by
applicable law, this Agreement, or a memorandum thereof if permitted under applicable law, is subject to recordation in all appropriate public offices for real property records in all of the counties or other comparable jurisdictions in which any or
all of the 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 the Noteholders’ expense on direction and at the expense of
Majority Noteholders requesting such recordation, but only when accompanied by an Opinion of Counsel to the effect that such recordation materially and beneficially affects the interests of the Noteholders or is necessary for the administration or
servicing of the Mortgage Loans. 
  
 Section 10.05. Duration of
Agreement. This Agreement shall continue in existence and effect until terminated as herein provided. 
  
 Section 10.06. Notices. All demands, notices and communications hereunder shall be in writing and shall be deemed to have been duly given when
delivered to (i) in the case of the Servicer, Accredited Home Lenders, Inc., 15090 Avenue of Science, San Diego, California 92128, Attention: Director of Operations with a copy to General Counsel; (ii) in the case of the Issuer, Accredited Mortgage
Loan Trust 2005-3, c/o the Owner Trustee at its Corporate Trust Office, Attention: Corporate Trust Administration; (iii) in the case of the Indenture Trustee, LaSalle Bank National Association, 135 South LaSalle Street, Suite 1625, Chicago, Illinois
60603, Attn: Global Securities and Trust Services Group - Accredited 2005-3; (iv) in the case of the Sponsor, Accredited Home Lenders, Inc., 15090 Avenue of Science, San Diego, California 92128, Attention: Investor Reporting; (v) in the case of the
Underwriter, Morgan Stanley & Co. Incorporated, 1585 Broadway, New York, New York 10036, Attention: Steve Shapiro; (vi) in the case of Standard & Poor’s Rating Services, 55 Water Street, New York, New York 10004, Attention: Residential
Mortgage Surveillance Group; (vii) in the case of Moody’s Investors Service, Inc., 99 Church Street, New York, New York 10007, Attention: RMBS Monitoring Department, 4th Floor; (viii) in the case of Dominion Bond Rating Service, Inc. 55
Broadway, 15th Floor, New York, New York 10006; (ix) in the case of the Depositor, Accredited Mortgage Loan REIT Trust, 15090 Avenue of Science, San Diego, California 92128, Attention: General Counsel; (x) in the case of the Swap Provider, Swiss Re
Financial Products Corporation, 55 East 52nd Street, New York, New York 10055 and (xi) in the case of the Noteholders, as set forth in the Note Register. Any such notices shall be deemed to be effective with respect to any party hereto upon the
receipt of such notice by such party, except that notices to the Noteholders shall be effective upon mailing or personal delivery. 
  
 Section 10.07. Severability of Provisions. If any one or more of the covenants, agreements, provisions or terms of this Agreement shall be held
invalid for any reason whatsoever, 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 covenants, agreements, provisions or terms of this Agreement. 
  

 57 

 Section 10.08. No Partnership. Nothing herein contained shall be deemed or construed to create a
co-partnership or joint venture between the parties hereto and the services of the Servicer shall be rendered as an independent contractor and not as agent for the Noteholders. 
  
 Section 10.09. Counterparts. This Agreement may be executed in one or more counterparts and by the different parties
hereto on separate counterparts, each of which, when so executed, shall be deemed to be an original; such counterparts, together, shall constitute one and the same agreement. 
  
 Section 10.10. Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the Issuer,
the Servicer, the Depositor, the Sponsor, the Indenture Trustee and the Noteholders and their respective successors and permitted assigns. 
  
 Section 10.11. Headings. The headings of the various sections of this Agreement have been inserted for convenience of reference only and shall not
be deemed to be part of this Agreement. 
  
 Section 10.12. No
Petition. The Servicer, by entering into this Agreement hereby covenants and agrees, and the Noteholders, by the acceptance of their Notes are deemed to covenant and agree, that they will not at any time institute against the Issuer, or join in
any institution against the Issuer of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States Federal or state bankruptcy law in connection with any obligations relating to
the Certificates, the Notes, this Agreement or any of the other Basic Documents. 
  
 This Section 10.12 will survive for one year and one day following the termination of this Agreement. 
  
 Section 10.13. Third Party Beneficiary. The parties agree that each of the Owner Trustee and the Swap Provider (if the Swap Agreement is still
outstanding) is intended and shall have all rights of a third-party beneficiary of this Agreement. 
  
 Section 10.14. Intent of the Parties. It is the intent of the parties hereto and Noteholders that, for federal income taxes, state and local income
or franchise taxes and other taxes imposed on or measured by income, the Notes be treated as debt. The parties to this Agreement and the Holder of each Note, by acceptance of its Note, and each Beneficial Owner thereof, agree to treat, and to take
no action inconsistent with the treatment of, the related Notes in accordance with the preceding sentence for purposes of federal income taxes, state and local income and franchise taxes and other taxes imposed on or measured by income. 

 
 Section 10.15. GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF JURY
TRIAL. (a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS (AS OPPOSED TO CONFLICT OF LAWS PROVISIONS) OF THE STATE OF NEW YORK. 
  
 (b) THE TRUST, THE SERVICER, THE DEPOSITOR, THE SPONSOR, THE INDENTURE TRUSTEE HEREBY SUBMITS TO THE
NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND THE UNITED 

  

 58 

 
STATES DISTRICT COURT LOCATED IN THE BOROUGH OF MANHATTAN IN NEW YORK CITY, AND WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON IT AND CONSENTS THAT ALL
SUCH SERVICE OF PROCESS BE MADE BY REGISTERED MAIL DIRECTED TO THE ADDRESS SET FORTH IN SECTION 10.06 HEREOF AND SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN DEPOSITED IN THE U.S. MAILS, POSTAGE
PREPAID. THE ISSUER, THE DEPOSITOR, THE SPONSOR, THE SERVICER AND THE INDENTURE TRUSTEE EACH HEREBY WAIVE ANY OBJECTION BASED ON FORUM NON CONVENIENS, AND ANY OBJECTION TO VENUE OF ANY ACTION INSTITUTED HEREUNDER AND CONSENTS TO THE GRANTING OF SUCH
LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY THE COURT. NOTHING IN THIS SECTION 10.15 SHALL AFFECT THE RIGHT OF THE ISSUER, THE DEPOSITOR, THE SPONSOR, THE SERVICER OR THE INDENTURE TRUSTEE TO SERVE LEGAL PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR AFFECT ANY OF THEIR RIGHTS TO BRING ANY ACTION OR PROCEEDING IN THE COURTS OF ANY OTHER JURISDICTION. 
  
 (c) THE ISSUER, THE DEPOSITOR, THE SPONSOR, THE SERVICER, THE INDENTURE TRUSTEE AND THE SWAP PROVIDER EACH HEREBY WAIVES ANY RIGHT TO HAVE
A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE ARISING OUT OF, CONNECTED WITH, RELATED TO, OR IN CONNECTION WITH THIS AGREEMENT. INSTEAD, ANY DISPUTE WILL BE RESOLVED IN A BENCH TRIAL WITHOUT A JURY.

  
 [Remainder of Page Intentionally Left Blank] 
  

 59 

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

					
	 ACCREDITED HOME LENDERS, INC.,
as Sponsor and Servicer

		
	By:	 	 
	 	 	 Name:
	 	 David E. Hertzel

	 	 	 Title:
	 	 GC, AVP & Ass’t Sec’y

	
	 ACCREDITED MORTGAGE LOAN TRUST 2005-3

		
	By:	 	U.S. BANK TRUST NATIONAL ASSOCIATION, not in its individual capacity, but solely as Owner Trustee under the Trust Agreement
		
	By:	 	 
	 	 	 Name:
	 	 
	 	 	 Title:
	 	 
	
	 ACCREDITED MORTGAGE LOAN REIT TRUST
as Depositor

		
	By:	 	 
	 	 	 Name:
	 	 Melissa Dant

	 	 	 Title:
	 	Senior Secondary Markets Counsel, Ass’t Vice President, and Ass’t Secretary
	
	 LASALLE BANK NATIONAL ASSOCIATION,
 as Indenture Trustee

		
	By:	 	 
	 	 	 Name:
	 	 
	 	 	 Title:
	 	 
		
	By:	 	 
	 	 	 Name:
	 	 
	 	 	 Title:
	 	 

  
 [Signature Page
to Sale and Servicing Agreement] 
  

 60 

  
 SCHEDULE I 
  
 MORTGAGE LOAN SCHEDULE 
  
 [Delivered to the Sponsor, the Servicer, the Depositor and the Trustee at the
Closing] 
  

 A-1 

  
 APPENDIX I 
  
 DEFINED TERMS 
  
 [See Appendix I to Indenture] 

  
 EXHIBIT A 
  
 CONTENTS OF THE MORTGAGE FILE 
  
 With respect to each Mortgage Loan, the Mortgage File shall include each of
the following items (copies to the extent the originals have been delivered to the Indenture Trustee for the benefit of the Noteholders, pursuant to Section 2.05 of the Sale and Servicing Agreement), all of which shall be available for inspection by
the Noteholders, to the extent required by applicable laws: 
  
 1.
the original Mortgage Note, endorsed without recourse in blank from the last endorsee thereof, including all intervening endorsements showing a complete chain of endorsement; 
  
 2. the related original Mortgage with evidence of recording indicated thereon or a copy thereof certified by the applicable
recording office and if the Mortgage Loan is registered on the MERS System, such Mortgage or an assignment of the Mortgage shall reflect MERS as the mortgagee of record and shall include the MIN for such Mortgage Loan; 
  
 3. each intervening mortgage assignment, with evidence of recording indicated
thereon or if the original is not available, a copy thereof certified by the applicable recording office, if any, showing a complete chain of assignment from the last assignee thereof of the related Mortgage Loan to the Sponsor (or to MERS, if the
Mortgage Loan is registered on the MERS System), and noting the presence of a MIN (if the Mortgage Loan is registered on the MERS System) (which assignment may, at the Sponsor’s option, be combined with the assignment referred to in subpart (4)
hereof, in which case it must be in recordable form, but need not have been previously recorded); 
  
 4. unless the Mortgage Loan is recorded on the MERS System, a mortgage assignment in recordable form (which, if acceptable for recording in the relevant
jurisdiction as evidenced by an Opinion of Counsel addressed to the Indenture Trustee, may be included in a blanket assignment or assignments) of each Mortgage from the Sponsor to the Indenture Trustee; 
  
 5. originals of all assumption, modification and substitution agreements in
those instances where the terms or provisions of a Mortgage or Mortgage Note have been modified or such Mortgage or Mortgage Note has been assumed (if any); and 
  

6. an original title insurance policy or title opinion (or (A) a copy of the title insurance policy or title opinion, or (B) the related binder,
commitment or preliminary report, or copy thereof in which case the Sponsor hereby certifies that the original Mortgage has been delivered to the title insurance company that issued such binder, commitment or preliminary report). 
  

 A-1 

 In instances where the original recorded Mortgage or any intervening mortgage assignment or a completed
assignment of the Mortgage in recordable form cannot be delivered by the Sponsor to the Indenture Trustee prior to or concurrently with the execution and delivery of this Agreement, due to a delay in connection with recording, the Sponsor may:

  
 (a) with respect to item (3) above, in lieu of delivering such
original recorded Mortgage or intervening mortgage assignment, deliver to the Indenture Trustee, a copy thereof; provided, that the Sponsor certifies that the original Mortgage has been delivered to a title insurance company for recordation after
receipt of its policy of title insurance or the related binder, commitment or preliminary report; and 
  
 (b) in lieu of delivering the completed assignment in recordable form, deliver to the Indenture Trustee, the assignment in recordable form, otherwise
complete except for recording information. 
  

 A-2 

  
 EXHIBIT B 
  
 [RESERVED] 
  

 B-1 

  
 EXHIBIT C 
  
 INDENTURE TRUSTEE’S ACKNOWLEDGEMENT OF RECEIPT 
  
 August [_], 2005 
  

			
	 Morgan Stanley & Co. Incorporated
 1585
Broadway
 New York, New York 10036
	  	 Accredited Home Lenders, Inc.
 15090 Avenue of
Science
 San Diego, California 92128

		
	 Accredited Mortgage Loan REIT Trust
 15090 Avenue of
Science
 San Diego, California 92128
	  	 

  

	 	Re:	Sale and Servicing Agreement, dated as of August 1, 2005 among Accredited Home Lenders, Inc., as Sponsor and Servicer, Accredited Mortgage Loan REIT Trust, as depositor, Accredited
Mortgage Loan Trust 2005-3, and LaSalle Bank National Association, as Indenture Trustee  

  
 Ladies and Gentlemen: 
  
 In accordance with Section 2.06(b)(i) of the above-captioned Sale and Servicing Agreement, the undersigned, as Indenture Trustee, hereby acknowledges
receipt by it in good faith without notice of adverse claims, subject to the provisions of Sections 2.04 and 2.05 of the Sale and Servicing Agreement (as such provisions relate to the Mortgage Loan), of, with respect to each Mortgage Loan, a
Mortgage File containing the original Mortgage Note, except with respect to the list of exceptions attached hereto, and based on its examination and only as to the foregoing, the information set forth in items (i), (ii) (with respect to property
address only, excluding zip code), (iii) and (vi) of the definition of the “Mortgage Loan Schedule” accurately reflects information set forth in the Mortgage Note, and declares that it holds and will hold such documents and the other
documents delivered to it constituting the Indenture Trustee’s Mortgage Files, and that it holds or will hold all such assets and such other assets included in the definition of “Trust Estate” that are delivered to it for the
exclusive use and benefit of all present and future Noteholders. 
  
 The Indenture Trustee has made no independent examination of any such documents beyond the review specifically required in the above-referenced Sale and Servicing Agreement. The Indenture Trustee makes no representations as to: (i) the
validity, legality, recordability, sufficiency, perfection, priority, enforceability or genuineness of any such documents or any of the Mortgage Loans identified on the Mortgage Loan Schedule, or (ii) the collectability, insurability, effectiveness
or suitability of any such Mortgage Loan. 
  

 C-1 

 The Mortgage Loan Schedule is attached to this Receipt. 
  
 Capitalized words and phrases used herein shall have the respective meanings
assigned to them in Appendix I to the Indenture, dated as of August 1, 2005, by and between Accredited Mortgage Loan Trust 2005-3 and the Indenture Trustee. 
  

					
	 LASALLE BANK NATIONAL ASSOCIATION,
 as
Indenture Trustee

		
	By:	 	 
	 	 	 Name:
	 	 
	 	 	 Title:
	 	 

  

 C-2 

  
 EXHIBIT D 
  
 INITIAL CERTIFICATION OF INDENTURE TRUSTEE 
  
                     , 2005 
  

			
	 Morgan Stanley & Co. Incorporated
 1585
Broadway
 New York, New York 10036
	  	 Accredited Home Lenders, Inc.
 15090 Avenue of
Science
 San Diego, California 92128

		
	 Accredited Mortgage Loan REIT Trust
 15090 Avenue of
Science
 San Diego, California 92128
	  	 

  

	 	Re:	Sale and Servicing Agreement, dated as of August 1, 2005 among Accredited Home Lenders, Inc., as Sponsor and Servicer, Accredited Mortgage Loan REIT Trust, as depositor, Accredited
Mortgage Loan Trust 2005-3, and LaSalle Bank National Association, as Indenture Trustee  

  
 Ladies and Gentlemen: 
  
 In
accordance with the provisions of Section 2.06(b)(ii) of the above-referenced Sale and Servicing Agreement, the undersigned, as Indenture Trustee, hereby certifies that as to each Mortgage Loan listed in the Mortgage Loan Schedule (other than any
Mortgage Loan paid in full or any Mortgage Loan listed on the attachment hereto), it has reviewed the documents delivered to it pursuant to Section 2.05(a) of the Sale and Servicing Agreement and has determined that, except as noted on the
attachment hereto, (i) all documents required to be delivered to it pursuant to Section 2.05(a)(i)-(iv) and (vi) of the above-referenced Sale and Servicing Agreement are in its possession, (ii) such documents have been reviewed by it and appear
regular on their face and have not been mutilated, damaged, torn or otherwise physically altered (handwritten additions, changes or corrections do not constitute physical alteration if they reasonably appear to have been initialed by the Mortgagor)
and relates to such Mortgage Loan and (iii) based on its examination and only as to the foregoing documents, the information set forth in the Mortgage Loan Schedule as to the information in clauses (i), (ii) (with respect to property address only,
excluding zip code), (iii) and (vi) of the definition of “Mortgage Loan Schedule” respecting such Mortgage Loan accurately reflects the information set forth in Indenture Trustee’s Mortgage File. The Indenture Trustee has made no
independent examination of such documents beyond the review specifically required in the above-referenced Sale and Servicing Agreement. The Indenture Trustee makes no representations as to: (x) the validity, legality, recordability, sufficiency,
perfection, priority, enforceability or genuineness of any such documents contained in each or any of the Mortgage Loans identified on the Mortgage Loan Schedule, or (y) the collectability, insurability, effectiveness or suitability of any such
Mortgage Loan. 
  

 D-1 

 Capitalized words and phrases used herein shall have the respective meanings assigned to them in the
above-captioned Sale and Servicing Agreement. 
  

					
	 LASALLE BANK NATIONAL ASSOCIATION,
 as
Indenture Trustee

		
	By:	 	 
	 	 	 Name:
	 	 
	 	 	 Title:
	 	 

  

 D-2 

  
 EXHIBIT E 
  
 FINAL CERTIFICATION OF INDENTURE TRUSTEE 
  
                     , 2005 
  

			
	 Morgan Stanley & Co. Incorporated
 1585
Broadway
 New York, New York 10036
	  	 Accredited Home Lenders, Inc.
 15090 Avenue of
Science
 San Diego, California 92128

		
	 Accredited Mortgage Loan REIT Trust
 15090 Avenue of
Science
 San Diego, California 92128
	  	 

  

	 	Re:	Sale and Servicing Agreement, dated as of August 1, 2005 among Accredited Home Lenders, Inc., as Sponsor and Servicer, Accredited Mortgage Loan REIT Trust, as depositor, Accredited
Mortgage Loan Trust 2005-3, and LaSalle Bank National Association, as Indenture Trustee  

  
 Ladies and Gentlemen: 
  
 In
accordance with the provisions of Section 2.06(b)(iii) of the above-referenced Sale and Servicing Agreement, the undersigned, as Indenture Trustee, hereby certifies that as to each Mortgage Loan listed in the Mortgage Loan Schedule (other than any
Mortgage Loan paid in full or any Mortgage Loan listed on the attachment hereto), it has reviewed the documents delivered to it pursuant to Section 2.05(a) of the Sale and Servicing Agreement and has determined that (i) all documents required to be
delivered to it pursuant to Section 2.05(a)(i)-(iv) and (vi) of the above referenced Sale and Servicing Agreement are in its possession, (ii) such documents have been reviewed by it and appear regular on their face and have not been mutilated,
damaged, torn or otherwise physically altered (handwritten additions, changes or corrections do not constitute physical alteration if they reasonably appear to have been initialed by the Mortgagor) and relates to such Mortgage Loan and (iii) based
on its examination and only as to the foregoing documents, the information set forth in items (i), (ii) (with respect to property address only, excluding zip code), (iii) and (vi) of the definition of the Mortgage Loan Schedule respecting such
Mortgage Loan that can be determined from the face of such documents accurately reflects the information set forth in the Indenture Trustee’s Mortgage File. The Indenture Trustee has made no independent examination of such documents beyond the
review specifically required in the above-referenced Sale and Servicing Agreement. The Indenture Trustee makes no representations as to: (x) the validity, legality, recordability, sufficiency, perfection, priority, enforceability or genuineness of
any such documents contained in each or any of the Mortgage Loans identified on the Mortgage Loan Schedule, or (y) the collectability, insurability, effectiveness or suitability of any such Mortgage Loan. 
  

 E-1 

 Capitalized words and phrases used herein shall have the respective meanings assigned to them in the
above-captioned Sale and Servicing Agreement. 
  

					
	 LASALLE BANK NATIONAL ASSOCIATION,
 as
Indenture Trustee

		
	By:	 	 
	 	 	 Name:
	 	 
	 	 	 Title:
	 	 

  

 E-2 

  
 EXHIBIT F 
  
 REQUEST FOR RELEASE OF DOCUMENTS 
  

	To:	LaSalle Bank National Association 

	    	135 South LaSalle Street, Suite 1625 

	    	Chicago, IL 60603 

	    	Attn: Global Securities and Trust Services Group - Accredited 2005-3 

  

	 	Re:	Sale and Servicing Agreement, dated as of August 1, 2005 among Accredited Home Lenders, Inc., as Sponsor and Servicer, Accredited Mortgage Loan REIT Trust, as depositor, Accredited
Mortgage Loan Trust 2005-3, and LaSalle Bank National Association, as Indenture Trustee (“Custodian/Indenture Trustee”) 

  
 In connection with the administration of the Mortgage Loans held by you as Indenture Trustee for the Issuer pursuant to the above-captioned Sale and
Servicing Agreement, we request the release, and hereby acknowledge receipt, of the Indenture Trustee’s Mortgage File for the Mortgage Loan described below, for the reason indicated. 
  
 Mortgage Loan Number: 
  
 Mortgagor Name, Address & Zip Code: 
  
 Reason for Requesting Documents (check one): 
  

							
	  ̈
	  	1.	  	Mortgage Paid in Full	  	 
				
	  ̈
	  	2.	  	Foreclosure	  	 
				
	  ̈
	  	3.	  	Substitution	  	 
				
	  ̈
	  	4.	  	Other Liquidation (Repurchases, etc.)	  	 
				
	  ̈
	  	5.	  	Nonliquidation Reason:	  	Reason:                                     
   

  
 Address to which
Indenture Trustee should 
  

									
	 Deliver the Mortgage File:
	 	 	 	 _____________________________________

	 	 	 	 	 _____________________________________

	 	 	 	 	 _____________________________________

					
	 	 	 	 	 	 	By:	 	 
	 	 	 	 	 	 	 	 	(authorized signer)
					
	 	 	 	 	 	 	 Issuer: 
	 	 
					
	 	 	 	 	 	 	 Address: 
	 	 
	 	 	 	 	 	 	 	 	 
					
	 	 	 	 	 	 	 Date: 
	 	 

  

 F-1 

  
 EXHIBIT G 
  
 ACCREDITED HOME LENDERS, INC. 
 OFFICER’S CERTIFICATE 
  
 I,                     , certify that: 
  

	1.	I have reviewed this annual report on Form 10-K, and all reports on Form 8-K containing distribution or servicing reports filed in respect of periods included in the year covered by
this annual report, of Accredited Mortgage Loan Trust 2005-3; 

  

	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 this annual report; 

  

	3.	Based on my knowledge, the distribution or servicing information required to be provided to the trustee by the servicer under the pooling and servicing, or similar, agreement is
included in these reports; 

  

	4.	Based on my knowledge and upon the annual compliance statement included in the report and required to be delivered to the trustee in accordance with the terms of the pooling and
servicing, or similar, agreement, and except as disclosed in the reports, the servicer has fulfilled its obligations under the servicing agreement; and 

  

	5.	The reports disclose all significant deficiencies relating to the servicer’s compliance with the minimum servicing standards based upon the report provided by an independent
public accountant, after conducting a review in compliance with the Uniform Single Attestation Program for Mortgage Bankers or similar procedure, as set forth in the pooling and servicing, or similar, agreement that is included in these reports.

  
 In giving the certifications above, I have reasonably relied on
information provided to me by the following unaffiliated parties:                             .

  

	
	 Date:

	
	  
	 Name:

	 Title:

  

 G-1Master Agreement, dated August 25, 2005

 Exhibit 10.2 
 Execution Copy 
 (Multicurrency – Cross Border) 
  
 ISDA® 
  
 International Swap Dealers Association, Inc. 
 MASTER AGREEMENT 
  
 dated as of August 25, 2005

  

					
	SWISS RE FINANCIAL PRODUCTS
CORPORATION	  	and	  	ACCREDITED MORTGAGE LOAN TRUST 2005-3
	(“Party A”)	  	 	  	(“Party B”)

  
 have entered and/or anticipate
entering into one of more transactions (each a “Transaction”) that are or will be governed by this Master Agreement, which includes the schedule (the “Schedule”), and the documents and other confirming evidence (each a
“Confirmation”) exchanged between the parties confirming those Transactions. 
 Accordingly, the parties agree as follows: — 
  

	1.	Interpretation 

  
 (a) Definitions. The terms defined in Section 14 and in the Schedule will have the meanings therein specified for the purpose of this Master Agreement. 
  
 (b) Inconsistency. In the event of any inconsistency between the provisions of
the Schedule and the other provisions of this Master Agreement, the Schedule will prevail. In the event of any inconsistency between the provisions of any Confirmation and this Master Agreement (including the Schedule), such Confirmation will
prevail for the purpose of the relevant Transaction. 
  
 (c) Single
Agreement. All Transactions are entered into in reliance on the fact that this Master Agreement and all Confirmations form a single agreement between the parties (collectively referred to as this “Agreement”), and the parties would
not otherwise enter into any Transactions. 
  

	2.	Obligations 

  
 (a) General Conditions. 
  
 (i) Each party will make each payment or delivery specified in each Confirmation to be made by it, subject to the other provisions of this Agreement. 
  

(ii) Payments under this Agreement will be made on the due date for value on that date in the place of the account specified in the relevant
Confirmation or otherwise pursuant to this Agreement, in freely transferable funds and in the manner customary for payments in the required currency. Where settlement is by delivery (that is, other than by payment), such delivery will be made for
receipt on the due date in the manner customary for the relevant obligation unless otherwise specified in the relevant Confirmation or elsewhere in this Agreement. 
  
 (iii) Each obligation of each party under Section 2(a)(i) is subject to (1) the condition precedent that no Event of Default
or Potential Event of Default with respect to the other party has occurred and is continuing, (2) the condition precedent that no Early Termination Date in respect of the relevant Transaction has occurred or been effectively designated and (3) each
other applicable condition precedent specified in this Agreement. 
  

				
	Copyright © 1992 by International Swap Dealers Association, Inc.	  	ISDA	® 1992

 value of that which was (or would have been) required to be delivered as of the originally scheduled date for delivery,
in each case together with (to the extent permitted under applicable law) interest, in the currency of such amounts, from (and including) the date such amounts or obligations were or would have been required to have been paid or performed to (but
excluding) such Early Termination Date, at the Applicable Rate. Such amounts of interest will be calculated on the basis of daily compounding and the actual number of days elapsed. The fair market value of any obligation referred to in clause (b)
above shall be reasonably determined by the party obliged to make the determination under Section 6(e) or, if each party is so obliged, it shall be the average of the Termination Currency Equivalents of the fair market values reasonably determined
by both parties. 
  
 IN WITNESS WHEREOF the parties have executed this document on
the respective dates specified below with effect from the date specified on the first page of this document. 
  

									
	SWISS RE FINANCIAL PRODUCTS	 	 	 	ACCREDITED MORTGAGE LOAN TRUST 2005-3
	CORPORATION	 	 	 	 By: U.S. Bank Trust National Association, not in its
 individual capacity but solely as Owner Trustee under the Trust Agreement.

					
	 By
	 	 	 	 	 	 By
	 	 
	 Name:
	 	 	 	 	 	 Name:
	 	 
	 Title:
	 	 	 	 	 	 Title:
	 	 
	 Date:
	 	 	 	 	 	 Date:
	 	 

  

 ISDA® 1992 

  
 Execution Copy

  
 SCHEDULE 
  
 to the 
  
 MASTER AGREEMENT 
  
 dated as of August 25, 2005 
  
 between 
  
 SWISS RE FINANCIAL PRODUCTS CORPORATION, 
 a corporation organized 
 under the laws of Delaware 
 (“Party
A”), 
 and 
  
 ACCREDITED MORTGAGE LOAN TRUST 2005-3, 
 a
statutory trust organized 
 under the laws of Delaware 
 (“Party B”). 
  
 Part
1. Termination Provisions. 
  
 (a) “Specified
Entity” means in relation to Party A for the purpose of: 
  
 Section 5(a)(v), Not Applicable. 
 Section 5(a)(vi), Not Applicable. 
 Section 5(a)(vii), Not Applicable. 
 Section
5(b)(iv), Not Applicable. 
  
 and in relation to
Party B for the purpose of: 
  
 Section 5(a)(v), Not Applicable.

 Section 5(a)(vi), Not Applicable. 
 Section 5(a)(vii), Not Applicable. 
 Section 5(b)(iv), Not Applicable. 
  
 (b) “Specified Transaction” shall have the meaning specified in Section 14 of this Agreement. 

 
 (c) The “Breach of Agreement” provisions of Section
5(a)(ii) will not apply. 
  
 (d) The “Credit Support
Default” provisions of Section 5(a)(iii) will apply to Party A and will not apply to Party B. 
  
 (e) The “Misrepresentation” provisions of Section 5(a)(iv) will not apply. 

 (f) (i) With respect to Party A only, Section 5(a)(vi) is hereby amended by deleting in the seventh line
thereof the words “, or becoming capable at such time of being declared,”. 
  

	 	(ii)	The “Cross Default” provisions of Section 5(a)(vi) will apply to Party A, but not to Party B. 

  

	 	(iii)	If such provisions apply: 

  
 “Specified Indebtedness” will have the meaning specified in Section 14. 
  
 “Threshold Amount” means with respect to Party A U.S. $100,000,000 or its equivalent in another currency.

  
 (g) With respect to Party B only, Section 5(a)(vii)(2) is
hereby amended as follows: 
  
 “(2) becomes insolvent or is
unable to pay its debts (other than payments due to holders of its subordinate notes) or fails or admits in writing its inability generally to pay its debts (other than payments to holders of its subordinate notes) as they become due”

  
 (h) The “Merger without Assumption”
provisions of Section 5(a)(viii) will apply to Party A and will not apply to Party B. 
  
 (i) The “Credit Event Upon Merger” provisions of Section 5(b)(iv) will not apply. 
  
 (j) The “Automatic Early Termination” provisions of Section 6(a) will not apply. 
  
 (k) Payments on Early Termination. For the purpose of Section 6(e):

  

	 	(i)	Market Quotation will apply. 

  

	 	(ii)	The Second Method will apply. 

  
 (l) “Termination Currency” means U.S. Dollars. 
  

(m) The “Additional Termination Event” provisions of Section 5(b)(v) will apply as set forth in Part 5(n) hereof. 
  
 (n) The “Default under Specified Transaction” provisions of
Section 5(a)(v) will not apply. 
  
 (o) The “Tax
Event” provisions of Section 5(b)(ii) will apply to Party A and will not apply to Party B. 
  

 2 

 (p) The “Tax Event Upon Merger” provisions of Section 5(b)(iii) will apply to Party A
and will not apply to Party B. 
  
 Part 2.  Tax Representations.

  
 (a) Payer Representations. For purposes of Section
3(e) of this Agreement, Party A and Party B each make the following representation: 
  
 It is not required by any applicable law, as modified by the practice of any relevant governmental revenue authority, of any Relevant Jurisdiction to make any deduction or withholding for or on account of any Tax from
any payment (other than interest under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to be made by it to the other party under this Agreement. In making this representation, it may rely on (i) the accuracy of any representations made by the
other party pursuant to Section 3(f) of this Agreement, (ii) the satisfaction of the agreement contained in Section 4(a)(i) or 4(a)(iii) of this Agreement and the accuracy and effectiveness of any document provided by the other party pursuant to
Section 4(a)(i) or 4(a)(iii) of this Agreement, and (iii) the satisfaction of the agreement of the other party contained in Section 4(d) of this Agreement, provided that it shall not be a breach of this representation where reliance is placed on
subclause (ii) and the other party does not deliver a form or document under Section 4(a)(iii) by reason of material prejudice to its legal or commercial position. 
  
 (b) Party A Payee Representations. For the purpose of Section 3(f) of this Agreement, Party A makes the following
representations: 
  

	 	(i)	It is a “U.S. payee” within the meaning of Treasury Regulation Section 1.1441-5(b). 

  

	 	(ii)	It is a United States person within the meaning of Section 7701(a)(30) of the Internal Revenue Code of 1986, as amended. 

  
 (c) Party B Payee Representations. For the purpose of Section 3(f) of
this Agreement, Party B makes the following representation: 
  

	 	(i)	It is a trust created under an agreement governed by Delaware law. 

  
 Part 3.  Agreement to Deliver Documents. 
  
 For the purpose of Section 4(a), each party agrees to deliver the following documents, as applicable: 
  
 (a) Tax forms, documents, or certificates to be delivered are: 
  
 Party A agrees to complete, execute, and deliver to Party B, United States
Internal Revenue Service Form W-9 or any successor of such form: (i) on 

  

 3 

 
a date which is before the first scheduled payment date under this Agreement; (ii) promptly upon reasonable demand by Party B; and (iii) promptly upon
learning that any such forms previously provided by Party A has become obsolete or incorrect. 
  
 Party B agrees to complete, execute, and deliver to Party A, United States Internal Revenue Service Form W-9 or any successor of such forms: (i) on a date which is before the first scheduled payment date under this
Agreement; (ii) promptly upon reasonable demand by Party A; and (iii) promptly upon learning that any such forms previously provided by Party B has become obsolete or incorrect. 
  
 (b) Other documents to be delivered are: 
  

							
	 Party required
to deliver
document

	  	 Form/Document/
Certificate

	  	 Date by which to
be delivered

	  	 Covered by
Section 3(d)
Representation

	Party A	  	Guaranty dated as of August 25, 2005 by Swiss Reinsurance Company (the “Guaranty”),	  	At execution of this Agreement	  	Yes
				
	Party A	  	Most recently prepared annual balance sheet of Party A	  	As soon as possible following request of Party B	  	Yes
				
	Party A	  	Legal opinions with respect to Party A	  	At execution of this Agreement	  	No
				
	Party A and Party B	  	Incumbency certificate or other documents evidencing the authority, incumbency and specimen signature of each person executing this Agreement, any Credit Support Document or any Confirmation, as
the case may be.	  	At execution of this Agreement	  	Yes
				
	Party B	  	Servicer Remittance Reports	  	Promptly upon becoming available	  	Yes

  

 4 

							
	 Party required
to deliver
document

	  	 Form/Document/
Certificate

	  	 Date by which to
be delivered

	  	 Covered by
Section 3(d)
Representation

	Party B	  	Legal opinion with respect to Party B	  	At execution of this Agreement	  	No
				
	Party B	  	An executed copy of the Indenture, dated as of August 1, 2005, between Party B and LaSalle Bank National Association (the “Indenture”)	  	Within 30 days after the date of this Agreement	  	No

  

 5 

 Part 4. Miscellaneous. 
  
 (a) Addresses for Notices. For the purpose of Section 12(a): Address for notices or communications to Party A:

  

			
	 Address:
	  	Swiss Re Financial Products
Corporation
55 East 52nd
Street
New York, New York 10055
		
	 Attention:
	  	Head of Operations
		
	 Facsimile No.:
	  	(212) 317-5335

  
 With a copy to: 
  

			
	 Address:
	  	Swiss Re Financial Products
Corporation
55 East 52nd
Street
New York, New York 10055
		
	 Attention:
	  	Head of Legal
		
	 Facsimile No.
	  	(212) 317-5474

  
 Address for notices or communications
to Party B: 
  

			
	Address:	  	 Accredited Home Lenders
 15090 Avenue of
Sciences,
 Suite 200, San Diego, CA 92128

		
	Attention:	  	John Tull, CPA
		
	Facsimile No.:	  	(858) 676-8110

  
 With a copy to U.S. Bank Trust
National Association 
  

			
	Address:	  	 209 South LaSalle Street, Suite 300
 Chicago, IL
60604

		
	Attention:	  	Corporate Trust Services
		
	Facsimile No.:	  	(312) 325-8905
		
	Telephone No.:	  	(312) 325-8902

  

 6 

 With a copy to LaSalle Bank National Association: 
  

			
	Address:	  	 135 S. LaSalle Street
 Suite 1625
 Chicago, Illinois 60603

		
	Attention:	  	Global Securities and Trust Services
Group – Accredited Mortgage Loan
Trust 2005-3
		
	 Facsimile:
 Telephone No.:
	  	 (312) 904-1368
 (312) 904-0351

  
 (b) Process Agent.
For the purpose of Section 13(c): 
  
 Party A appoints as its Process Agent:
Not Applicable 
  
 Party B appoints as its Process Agent: Not Applicable

  
 With a copy to: 
  

			
	Address:	  	 Standard & Poor’s Ratings Services,
 55 Water
Street,
 New York, New York 10041-0003

		
	Attention:	  	Residential Mortgage Surveillance Group
		
	Facsimile:	  	212-438-2652

  
 With a copy to: 
  

			
	Address:	  	Moody’s Investors Service, 99 Church
Street, New York, New York 10007
		
	Attention:	  	Keith Wofford
		
	Facsimile:	  	212-553-4773

  
 With a copy to: 
  

			
	Address:	  	 Dominion Bond Rating Service Inc.,
 55 Broadway, Suite
1502,
 New York, New York 10006

		
	Attention:	  	Quincy Tang
		
	Facsimile:	  	212-635-3278

  

 7 

 (c) Offices; Multibranch Parties. 
  

	 	(i)	The provisions of Section 10(a) will be applicable. 

  

	 	(ii)	For the purpose of Section 10(c): 

  
 Party A is not a Multibranch Party. 
  
 Party B is not a Multibranch Party. 
  
 (d) Calculation Agent. The Calculation Agent is Party A. 
  

(e) Credit Support Document. Details of any Credit Support Document. 
  

	 	(i)	With respect to Party A, (A) the Support Agreement, (B) the Guaranty and (C) any Credit Support Annex that may be entered into in connection with any of the events described in Part
5(n)(ii) of this Schedule. 

  

	 	(ii)	With respect to Party B, the Indenture. 

  
 Each Credit Support Document is incorporated by reference into and constitutes part of this Agreement and each Confirmation as if set forth in full in
this Agreement or such Confirmation. 
  
 (f) Credit Support
Provider. 
  

	 	(i)	Credit Support Provider means in relation to Party A, Swiss Reinsurance Company. 

  

	 	(ii)	Credit Support Provider means in relation to Party B, Not Applicable. 

  
 (g) Governing Law. This Agreement and each Confirmation will be governed by, and construed and enforced in accordance with, the substantive law of the
State of New York, without reference to its choice of law doctrine. 
  
 (h) Jurisdiction. Section 13(b) is hereby amended by: (i) deleting in the second line of subparagraph (i) thereof the word “non-”; and (ii) deleting the final paragraph thereof. 
  
 (i) Netting of Payments. Subparagraph (ii) of Section 2(c) will apply
to Transactions with effect from the date of this Agreement. 
  
 (j) “Affiliate” will have the meaning specified in Section 14; provided, however, that for purposes of Section 3(c), such term shall only refer to any Credit 

  

 8 

 
Support Provider of the party and/or any party that is a Specified Entity for Bankruptcy and shall apply to Party A only. Party B shall be deemed to have no
Affiliates. 
  
 Part 5. Other Provisions. 
  
 (a) Accuracy of Specified Information. With respect to Party A,
Section 3(d) is hereby amended by adding in the third line thereof after the word “respect” and before the period the words “or, in the case of audited or unaudited financial statements or balance sheets, a fair presentation of the
financial condition of the relevant person.” 
  
 (b)
Transfer. Section 7 is hereby amended by: 
  

	 	(i)	adding in the third line thereof after the word “party,” the words “which consent shall not be unreasonably withheld or delayed” and adding in the third line
thereof after the clause “that: -” the words “provided” that the Rating Agency Condition is satisfied; 

  

	 	(ii)	adding in the second line of subparagraph (a) thereof after the words “assets to,” the words “or reorganization, incorporation, reincorporation, reconstitution, or
reformation into or as”; 

  

	 	(iii)	deleting at the end of subparagraph (a) thereof the word “and”; 

  

	 	(iv)	deleting in the second line of subparagraph (b) thereof the period and replacing it with “; and”; 

  

	 	(v)	adding after subparagraph (b) thereof the following subparagraph (c): 

  
 (c) in addition to, and not in lieu of, the preceding transfer rights, Party A may, without recourse by Party B or Party A’s transferee to or
against Party A, transfer this Agreement, in whole, but not in part, to any of Party A’s Affiliates or any of the Affiliates of Swiss Reinsurance Company pursuant to documentation prepared by Party A, provided that: 
  

	 	(i)	either (A) such transferee must have a long-term, unsecured, unsubordinated debt obligation ratings or financial program ratings (or other similar ratings) by S&P and
Moody’s which are equal to or greater than the comparable long-term, unsecured, unsubordinated debt obligation ratings or financial program ratings (or other similar ratings) of Party A immediately prior to such transfer, or (B) the obligations
transferred to such transferee must be guaranteed by Party A pursuant to a guaranty in substantially the form of the Guaranty of the Credit Support Provider or other agreement or instrument consented to by Party B or other agreement or instrument
mutually agreed upon by both parties and satisfactory to S&P; 

  

 9 

	 	(ii)	the transferee will not, as a result of such transfer, be required to withhold or deduct on account of a Tax under Section 2(d)(i) on the next succeeding Scheduled Payment Date an
amount in excess of that which Party A would have been required to so withhold or deduct on the next succeeding Scheduled Payment Date in the absence of such transfer unless the transferee will be required to make payments of additional amounts
pursuant to Section 2(d)(i)(4) in respect of such excess; 

  

	 	(iii)	an Event of Default or a Termination Event does not occur as a result of such transfer; 

  

	 	(iv)	the Rating Agency Condition is satisfied. With respect to the results described in subclause (ii) above, Party A will cause the transferee to make, and Party B will make, such
reasonable Payer Tax Representations and Payee Tax Representations as may be mutually agreed upon by the transferee and Party B in order to permit such parties to determine that such results will not occur upon or after the transfer;

  

	 	(v)	Party A agrees to transfer only to a transferee in a jurisdiction, which it is aware is a “netting” jurisdiction, that is in which, by opinion of counsel published by
ISDA, netting under this Agreement shall be enforceable; and 

  

	 	(vi)	Party A will be responsible for any costs or expenses incurred in connection with such transfer. 

  

	 	(vi)	adding at the end of Section 7 the following sentence: 

  
 Except as may otherwise be stated in Section 7(c) hereof or in the documentation evidencing a transfer, a transfer of all of the obligations of Party A
made in compliance with this Section will constitute an acceptance and assumption of such obligations (and any related interests so transferred) by the transferee, a novation of the transferee in place of Party A with respect to such obligations
(and any related interests so transferred), and a release and discharge by Party B of Party A from, and an agreement by Party B not to make any claim for payment, liability, or otherwise against Party A with respect to, such obligations from and
after the effective date of the transfer. 
  
 (c) Set-Off.
Without affecting the provisions of this Agreement requiring the calculation of certain net payment amounts, as a result of an Event of Default or 

  

 10 

 
Termination Event or otherwise, all payments under this Agreement will be made without setoff or counterclaim. 
  
 (d) Reference Market-makers. The definition of “Reference
Market-makers” in Section 14 is hereby amended by adding in the fourth line thereof after the word “credit” the words “or to enter into transactions similar in nature to Transactions”. 
  
 (e) Procedures for Entering into Transactions. On or promptly
following the Trade Date or other transaction date of each Transaction, Party A will send to Party B a Confirmation. Party B will promptly thereafter request any correction of such Confirmation (indicating how it believes the terms of such
Confirmation should be correctly stated and such other terms which should be added to or deleted from such Confirmation to make it correct). 
  
 (f) Severability. If any term, provision, covenant, or condition of this Agreement, or the application thereof to any party or circumstance, shall
be held to be invalid or unenforceable (in whole or in part) for any reason, the remaining terms, provisions, covenants, and conditions hereof shall continue in full force and effect as if this Agreement had been executed with the invalid or
unenforceable portion eliminated, so long as this Agreement as so modified continues to express, without material change, the original intentions of the parties as to the subject matter of this Agreement and the deletion of such portion of this
Agreement will not substantially impair the respective benefits or expectations of the parties to this Agreement; provided, however, that this severability provision shall not be applicable if any provision of Section 2, 5, 6, or 13 (or any
definition or provision in Section 14 to the extent it relates to, or is used in or in connection with any such Section) shall be so held to be invalid or unenforceable. 
  
 (g) Waiver of Right to Trial by Jury. Each party hereby irrevocably waives, to the fullest extent permitted by
applicable law, any right it may have to trial by jury in respect of any suit, action or proceeding relating to this Agreement. 
  
 (h) Credit Support Default. Subparagraph (3) of Section 5(a)(iii) is hereby amended by adding in the second line thereof after the word
“Document” and before the semicolon the words “(or such action is taken by any person or entity appointed or empowered to operate it or act on its behalf).” 
  
 (i) Additional Representations. Section 3 is hereby amended by adding the following additional subsections:

  

	 	(i)	No Agency. It is entering into this Agreement and each Transaction as principal (and not as agent or in any other capacity, fiduciary or otherwise). 

 

	 	(ii)	Eligible Contract Participant. It is an “eligible contract participant” as defined in the U.S. Commodity Exchange Act. 

  

	 	(iii)	 No Reliance. In connection with the negotiation of, the entering into, and the confirming of the execution of, this Agreement and 

  

 11 

	 	 
each Transaction: (i) the other party is not acting as a fiduciary or financial or investment advisor for it; (ii) it is not relying upon any representations
(whether written or oral) of the other party other than the representations expressly set forth in this Agreement; and (iii) it has consulted with its own legal, regulatory, tax, business, investment, financial, and accounting advisors to the extent
it has deemed necessary, and it has made its own investment, hedging, and trading decisions based upon its own judgment and upon any advice from such advisors as it has deemed necessary and not upon any view expressed by the other party.

  
 (j) Consent to Assignment.
Notwithstanding Section 7 of this Agreement, Party A hereby acknowledges and consents to the assignment of this Agreement, solely for security purposes for the benefit of the Noteholders, by Party B to LaSalle Bank National Association, as trustee
(the “Indenture Trustee”) under the Indenture. The Indenture Trustee shall not be deemed to be a party to this Agreement; provided, however, that the Indenture Trustee, acting on behalf of the Noteholders, shall have the
right to enforce this Agreement, including the terms of Part 5(n), against Party A. Party A shall be entitled to rely on any notice or communication from the Indenture Trustee to that effect; provided, further, that any such notice
shall be in writing and delivered to Party A in accordance with Section 12 hereof. Party A shall be entitled to assume the authenticity of any such notice and shall have no obligation to verify the accuracy of any facts asserted therein and shall be
entitled to reasonably rely on the apparent authority of the sender thereof. Party B hereby indemnifies Party A against any losses, costs, claims or liabilities arising from Party A’s reliance on any such notice and Party A shall be released
from any further obligations to Party B with respect to the rights transferred to the Indenture Trustee (for so long as Party A has fulfilled its obligations hereunder to the Indenture Trustee). Notwithstanding any provision to the contrary
contained herein, the parties acknowledge that the indemnity contained in this Part 5(j) shall be considered an accrued and unpaid expense of the Trustee (reimbursable to Party A) (which expense shall be payable with Interest Proceeds under Section
5.07(i) of the Indenture and not as a payment due to a Swap Provider under the Swap Agreement) and is only due to the extent funds are available for the payment thereof in accordance with the priority of payments described in Article VIII of the
Indenture. 
  
 (k) Regarding Party A. Party B
acknowledges and agrees that Party A has had and will have no involvement in and, accordingly, accepts no responsibility for: (i) the establishment, structure, or choice of assets of Party B; (ii) the selection of any person performing services for
or acting on behalf of Party B; (iii) the selection of Party A as the counterparty; (iv) the terms of the Notes and the Certificates; (v) the preparation of or passing on the disclosure and other information contained in any prospectus or prospectus
supplement for the Notes and the Certificates, the Sale and Servicing Agreement, or any other agreements or documents used by Party B or any other party in connection with the marketing and sale of the Notes and the Certificates; (vi) the ongoing
operations and administration of Party B, including the furnishing of any information to Party B which is not specifically required under this Agreement; or (vii) any other aspect of Party B’s existence except for those matters specifically
identified in this Agreement. 
  

 12 

 (l) No Recourse. The Notes represent the non-recourse obligations of Party B only and the
Certificates represent an equity interest in Party B only and each of the foregoing does not represent an interest in or obligation of Party A, and no recourse may be had by the holders of the Notes and the Certificates against Party A or its assets
with respect to the Notes and the Certificates and/or this Agreement. 
  
 (m) Indemnifiable Tax. Party A agrees that Party B will not be required to pay any additional amounts pursuant to Section 2(d)(i)(4) of the Agreement in respect of an Indemnifiable Tax. If Party A is required to pay additional
amounts in respect of a withholding tax pursuant to Section 2(d)(i)(4) of this Agreement, Party A may transfer this Agreement, subject to satisfaction of the Rating Agency Condition, as provided in Section 6(b)(ii) of this Agreement and such
transfer shall not require the consent of Party B to the extent it is in conformance with the provisions of Section 7(c), as amended herein. 
  
 (n) Additional Termination Events. 
  

	 	(i)	It shall be an Additional Termination Event, with Party B as the sole Affected Party, if all Indenture Collateral is liquidated and the proceeds thereof distributed following an
Event of Default that has resulted in the principal of all the Notes being declared to be immediately due and payable. 

  

	 	(ii)	It shall also be an Additional Termination Event if (i) the Indenture Trustee receives direction (a “Redemption Notice”) for an optional redemption, in whole, of the Notes
under Article 10 of the Indenture (a “Redemption Termination”) and (ii) there remains no more than 5 Business Days prior to the proposed Redemption Date. In the case of a Redemption Termination, both Party A and Party B shall have the
right to cause a termination of this Agreement and, for purposes of Section 6(e)(ii) of this Agreement, Party B shall be the sole Affected Party. Following notification from the Indenture Trustee that it has received a Redemption Notice, Party A
shall provide the Indenture Trustee from time to time, upon request, with good faith estimates of the amount that would be payable under Section 6(e)(ii) in the event of such Redemption Termination. Any termination payment payable in respect of such
Additional Termination Event shall be paid on the relevant Redemption Date. 

  

	 	(iii)	 (I) It shall also be an Additional Termination Event, with Party A the sole Affected Party (except as expressly provided herein) if Party A, a replacement
counterparty, or a person or an entity that guarantees the obligations of Party A or a replacement counterparty, as the case may be, has a rating that does not satisfy the Required Hedge Counterparty Rating (but is at least “BBB-” or

  

 13 

	 	 
“A-3” (if applicable) by S&P or S&P or Moody’s withdraws its ratings and none of the following events has occurred:

  

	 	(A)	within 30 days of such failure to satisfy the Required Hedge Counterparty Rating, Party A or such replacement counterparty, as the case may be, transfers this Agreement, in whole,
but not in part, to a counterparty that satisfies the Required Hedge Counterparty Rating, subject to satisfaction of the Rating Agency Condition; 

  

	 	(B)	within 30 days of such failure to satisfy the Required Hedge Counterparty Rating, Party A or such replacement counterparty, as the case may be, collateralizes its Exposure to Party
B pursuant to an ISDA Credit Support Annex, subject to satisfaction of the Rating Agency Condition, as applicable; provided that such ISDA Credit Support Annex shall be made a Credit Support Document for Party A pursuant to an amendment of this
Agreement in a form acceptable to the Indenture Trustee; 

  

	 	(C)	within 30 days of such failure to satisfy the Required Hedge Counterparty Rating, the obligations of Party A or such replacement counterparty, as the case may be, under this
Agreement are guaranteed by a person or entity that satisfies the Required Hedge Counterparty Rating, subject to satisfaction of the Rating Agency Condition; or 

  

	 	(D)	within 30 days of such failure to satisfy the Required Hedge Counterparty Rating, Party A or such replacement counterparty, as the case may be, takes such other steps, if any, to
enable the Issuer to satisfy the Rating Agency Condition. 

  
 (II) It shall also be an Additional Termination Event, with Party A as the sole Affected Party (except as expressly provided herein) if Party A, a replacement counterparty, or a person or an entity that guarantees the
obligations of Party A or a replacement counterparty, as the case may be, has a rating of less than “BBB-” or “A-3” (if applicable) by S&P and within 7 days thereafter, Party A or such replacement counterparty, as the case
may be, while collateralizing its Exposure to Party B, fails to transfers this Agreement, in whole, but not in part, to a counterparty that satisfies the Required Hedge Counterparty Rating, subject to satisfaction of the Rating Agency Condition.

  
 Upon downgrade of Party A below the Required Hedge
Counterparty Rating or below “BBB-” or “A-3”, or if S&P or 

  

 14 

 
Moody’s withdraws its ratings for any reason, Party A will promptly give notice of the circumstances to Party B and to the rating agencies that at the
time are providing ratings for the Notes and Certificates. 
  
 Party B shall be entitled to (A)(1) in case of an Additional Termination Event described in Part 5(n)(iii)(I), designate a date that is not earlier than the expiration of the 30 day period referred to in Part 5(n)(iii)(I) as an Early
Termination Date in respect of all transactions under this Agreement by giving notice to Party A at least 10 days prior to the date so designated (which notice may be given prior to the expiration of such 30 day period) and (2) in case of an
Additional Termination Event described in this Part 5(n)(iii)(II), immediately designate an Early Termination Date, in respect of all transactions under this Agreement by giving notice to Party A and (B) no later than the respective dates specified
in clause (A)(1) and (A)(2), transfer the rights and obligations of Party A hereunder to a counterparty that satisfies the Required Hedge Counterparty Rating, subject to satisfaction of the Rating Agency Condition. 
  
 In connection with a transfer of this Agreement as described in this Part
5(n)(iii), Party A shall, at its sole cost and expense, use commercially reasonable efforts to seek a replacement counterparty and Party A shall reimburse Party B for (I) commercially reasonable fees and expenses incurred in connection with any of
the alternative actions contemplated in paragraphs (A), (B), (C) and (D) of Part 5(n)(iii)(I) above (whether or not they are completed within the 30 day period) and, if applicable, with the negotiation and documentation of a replacement hedge
agreement and (II) the fees and expenses, if any, incurred in connection with any of the alternative actions contemplated in paragraphs (A), (B), (C) and (D) of Part 5(n)(iii)(I) above (whether or not they are completed within the 30 day period)
and, if applicable, with the negotiation and documentation of a replacement hedge agreement that is not covered by subclause (I) for so long as Party A shall have consented to such fees and expenses prior to their incurrence by Party B, with
Party’s A consent not to be unreasonably withheld or delayed. 
  
 As used herein, “Required Hedge Counterparty Rating” means, with respect to a counterparty or entity guaranteeing the obligations of such counterparty, (x) either (i) if such counterparty or entity has only a long-term rating by
Moody’s, a long-term senior, unsecured debt obligation rating, financial program rating or other similar rating (as the case may be, the “Long-Term rating”) of at least “Aa3” by Moody’s and if rated “Aa3” by

  

 15 

 
Moody’s is not on negative credit watch by Moody’s or (ii) if such counterparty or entity has a Long-Term Rating and a short-term rating by
Moody’s, a Long-Term Rating of at least “A1” by Moody’s and a short-term rating of “P-1” by Moody’s and, in each case, such rating is not on negative credit watch by Moody’s and (y) (i) a short-term rating of
at least “A-1” by S&P or (ii) if such counterparty or entity does not have a short-term rating by S&P, a Long-Term Rating of at least “A+” by S&P. 
  
 For the purposes of determining the Settlement Amount with respect to the designation of an Early Termination Date arising
from the Additional Termination Event specified in Party 5(n)(iii), both Party A and Party B shall be Affected Parties. If the Settlement Amount calculated pursuant to this subclause (iii) is an amount owing by Party B to Party A, then such payment
shall be a Swap Termination Payment payable by Party B to Party A in accordance with the priority of payments described in the Indenture; provided, however, that (a) if Party A does not after the exercise of commercially reasonable
efforts cause any of the conditions specified in Part 5(n)(iii)(I)(A) to (D) to be satisfied, Party B shall use commercially reasonable efforts to enter into a replacement Transaction(s) with a counterparty acceptable to the Rating Agencies, in
respect of the Affected Transaction(s) relating to the Additional Termination Event; and (b) where multiple quotations are available such replacement Transaction(s) shall be entered into based on the quoted price(s) that would result in the largest
payment made to Party B by the replacement counterparty (it being understood that Party A may be permitted to actively solicit and obtain such quotations on behalf of Party B); and (c) to the extent that payments (“Replacement Payments”)
are received from a replacement counterparty by Party B as a result of entering into such replacement Transaction(s), then Party A shall have first priority as to such Replacement Payments versus all other creditors of Party B and Party B shall pay
from the Replacement Payments received the lesser of (x) the Replacement Payments so received and (y) the Swap Termination Payment to the extent not already paid by Party B over to Party A immediately upon receipt. 
  
 As used herein, “Exposure” means, as of any date of
determination, the amount, if any, that would be payable to Party B by Party A under this Agreement if an Early Termination Date were to occur as of such date of determination as a result of a Termination Event, Party A were the sole Affected Party,
all Transactions were terminated in connection with such Early Termination Date and (solely for purposes of determining Exposure) the amount of such payment were calculated using Market Quotation. 
  

 16 

	 	(iv)	It shall be an Additional Termination Event, with Party B as the sole Affected Party, if the Indenture is amended or modified in a manner that materially and adversely affects Party
A’s interests, without the prior consent of Party A, where such consent is required under the terms of the Indenture. 

  
 For any Additional Termination Event, the date that Party A or Party B, as the case may be, specifies in its notice of its election to terminate shall be
the Early Termination Date for the Transactions; provided, that solely in the case of an Additional Termination Event described in subclause (ii) above, the Early Termination Date shall be no earlier than the 3rd Business Day preceding the
Redemption Date and no later than the Redemption Date. 
  
 (o)
Indemnifiable Tax. The definition of “Indemnifiable Tax” in Section 14 is hereby amended by adding the following sentence at the end thereof: 
  

Notwithstanding the foregoing, “Indemnifiable Tax” also means any Tax imposed in respect of a payment under this Agreement by reason
of a Change in Tax Law by a government or taxing authority of a Relevant Jurisdiction of the party making such payment, unless the other party is incorporated, organized, managed and controlled, or considered to have its seat in such jurisdiction,
or is acting for purposes of this Agreement through a branch or office located in such jurisdiction. 
  
 (p) Limited Recourse; Non-petition. Party A agrees that the obligations of Party B hereunder are limited recourse obligations payable solely
from the Indenture Collateral, and due to the extent funds are available for the payment thereof in accordance with the priority of payments described in Article VIII of the Indenture, all outstanding obligations of Party B hereunder shall be
extinguished. Party A agrees that it will not, prior to the date which is at least one year and one day or, if longer, the then applicable preference period following the payment in full of all the Notes issued pursuant to the Indenture and the
expiration of all applicable preference periods under Title 11 of the United States Code or other applicable law relating to any such payment, acquiesce, petition or otherwise invoke or cause Party B to invoke the process of any governmental
authority for the purpose of commencing or sustaining a case (whether voluntary or involuntary) against Party B under any bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other
similar official of Party B or any substantial part of its property or ordering the winding-up or liquidation of the affairs of Party B. Nothing contained herein shall prohibit Party A from submitting a claim, or proof of claim, in any proceeding or
process instituted by or against Party B by any person other than Party A or its Affiliates. Party A and Party B agree that this Part 5(p) shall survive the termination of this Agreement for any reason whatsoever. 
  
 (q) Acknowledgement of Pledge of Collateral. Party A acknowledges
Party B’s pledge of its assets under the Indenture and understands that the proceeds of such 

  

 17 

 
assets will be applied, including to payments hereunder, only in the order set forth in the Indenture. 
  
 (r) Replacement Counterparty. Following a failure to satisfy the
Required Hedge Counterparty Rating in accordance with Part 5(n)(iii)(I), Party A will take one of the alternative actions contemplated in paragraphs (A), (B) and (C) of Part 5(n)(iii)(I) above. 
  
 (s) Confirmations. Transactions shall be promptly confirmed by the
parties by Confirmations exchanged by mail, telex, facsimile or other electronic means. Where a Transaction is confirmed by means of an electronic messaging system that the parties have elected to use to confirm such Transaction (i) such
confirmation will constitute a “Confirmation” as referred to in this Agreement even where not so specified in the confirmation and (ii) such Confirmation will supplement, form part of, and be subject to this Agreement and all provisions in
this Agreement will govern the Confirmation except as modified therein. 
  
 (t) Tax Documentation. Section 4(a)(iii) of the Agreement is hereby amended by adding prior to the existing text: 
  
 “upon the earlier of learning that any such form or document is required or” 
  
 (u) Inconsistency-Trade Call. In the event of any inconsistency between a telephone conversation, including a trade
call and a Confirmation signed by both parties, the Confirmation shall govern. 
  
 (v) Condition Precedent. The condition precedent in Section 2(a)(iii)(1) does not apply to a payment and delivery owing by a party if the other party shall have satisfied in full all its payment or delivery
obligations under Section 2(a)(i) and shall at the relevant time have no future payment or delivery obligations, whether absolute or contingent, under Section 2(a)(i). 
  
 (w) Definitions. This Agreement shall be subject to the 2000 Definitions (the “2000 Definitions”) as
published by the International Swaps and Derivatives Association Inc. The provisions of the 2000 Definitions are incorporated by reference in and shall be deemed a part of this Agreement, except that all references in the 2000 Definitions to a
“Swap Transaction” shall be deemed references to a “Transaction” for the purposes of this Agreement. Capitalized terms used and not otherwise defined herein (or in the 2000 Definitions) shall have the respective meanings ascribed
to such terms in the Sale and Servicing Agreement referred to in Part 5(k), except that for purposes hereof “Indenture Collateral” shall have the meaning ascribed to the term “Collateral” in the Indenture. If in relation to any
Transaction there is any inconsistency between the 2000 Definitions, this Agreement, the Indenture, any Confirmation and any other definitions published by ISDA that are incorporated into any Confirmation, the following will prevail for purposes of
such Transaction in the order of precedence indicated: (i) such Confirmation (without reference to any definitions or provisions incorporated therein); (ii) the Indenture; (iii) this Agreement; (iv) such other definitions; and (v) the 2000
Definitions. 
  

 18 

 (x) Amendments. Section 9(b) is hereby amended as follows: 
  

	 	(i)	by inserting the following phrase immediately prior to the period at the end of the sentence: “and the Rating Agency Condition is satisfied”; and 

 

	 	(ii)	by adding the following text thereto immediately following the first sentence: “Amendments to this Agreement or the Schedule may not be effected in a Confirmation.”

  
 (z) It is expressly understood and agreed by the
parties hereto that (i) this Agreement is executed and delivered by U.S. Bank Trust National Association, not individually or personally but solely as Owner Trustee of Party B, in the exercise of the powers and authority conferred and vested in it
under the Trust Agreement, (ii) each of the representations, undertakings and agreements herein made on the part of Party B is made and intended not as personal representations, undertakings and agreements by U.S. Bank Trust National Association but
is made and intended for the purpose of binding only Party B, (iii) nothing herein contained shall be construed as creating any liability on U.S. Bank Trust National Association, individually or personally, to perform any covenant either expressed
or implied contained herein, all such liability, if any, being expressly waived by the parties hereto and by any Person claiming, by through or under the parties hereto and (iv) under no circumstances shall U.S. Bank Trust National Association be
personally liable for the payment of any indebtedness or expenses of Party B or be liable for the breach or failure of any obligation, representation, warranty or covenant made or undertaken by Party B under this Agreement or any other related
documents. 
  

 19 

 IN WITNESS WHEREOF, the parties have executed this document on the respective dates specified
below with effect from the date specified on the first page of this document. 
  

			
	 SWISS RE FINANCIAL

	 PRODUCTS CORPORATION

		
	 By:
	 	 
	 	 	 Name:

	 	 	 Title:

	 	 	 Date:

	
	 ACCREDITED MORTGAGE

	 LOAN TRUST 2005-3

	
	 By: U.S. Bank Trust National Association, not in its
 individual capacity but solely as Owner Trustee
 under the Trust Agreement.

		
	 By:
	 	 
	 	 	 Name:

	 	 	 Title:

	 	 	 Date:

  

 20

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