Document:

EXHIBIT 4.5.2

                             Dated 28 January 2004
                             ---------------------

                        GRANITE FINANCE FUNDING LIMITED
                                  as Funding

                             THE BANK OF NEW YORK
                              as Security Trustee

                          GRANITE MORTGAGES 04-1 PLC
                               as Current Issuer

                               NORTHERN ROCK PLC
                   as Current Issuer Start-up Loan Provider

                                    - and -

                                    OTHERS

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                           ISSUER DEED OF ACCESSION

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                          SIDLEY AUSTIN BROWN & WOOD
                             1 THREADNEEDLE STREET
                                LONDON EC2R 8AQ
                            TELEPHONE 020 7360 3600
                            FACSIMILE 020 7626 7937

<PAGE>

                                   CONTENTS

1.    Interpretation.........................................................3

2.    Representations and Warranties.........................................3

3.    Accession..............................................................4

4.    Funding Security.......................................................5

5.    Title Guarantee........................................................7

6.    Application............................................................7

7.    Scope of the Funding Deed of Charge....................................7

8.    Notices and Acknowledgements...........................................7

9.    Amendment to the Funding Priority of Payments..........................8

10.   Notices and Demands....................................................8

11.   Non Petition Covenant..................................................9

12.   Third Party Rights....................................................10

13.   Execution in Counterparts.............................................10

14.   Governing Law and Jurisdiction; Appropriate Forum.....................10

15.   Process Agents........................................................10

SCHEDULE I  Utilisation of Issuer Reserves..................................16
APPENDIX 1 Amended and Restated Funding Priority of Payments................17

<PAGE>

THIS DEED OF ACCESSION is made on 28 January 2004

BETWEEN:

(1)   GRANITE FINANCE FUNDING LIMITED (registered number 79308), a private
      limited liability company incorporated under the laws of Jersey whose
      London branch is at 4 Royal Mint Court, London EC3N 4HJ;

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

(3)   THE BANK OF NEW YORK, a New York banking corporation whose London branch
      address is at 48th Floor, One Canada Square, London E14 5AL United
      Kingdom, (1) in its separate capacities as Note Trustee in respect of
      the Previous Issuers and (2) in its capacity as note trustee under the
      Current Issuer Trust Deed and the Current Issuer Deed of Charge (the
      "Current Issuer Note Trustee", which expression shall include such
      person and all other persons for the time being acting as the note
      trustee or note trustees pursuant to those deeds);

(4)   GRANITE MORTGAGES 01-1 PLC (registered number 4129652), a public limited
      company incorporated under the laws of England and Wales whose
      registered office is at Fifth Floor, 100 Wood Street, London EC2V 7EX;

(5)   GRANITE MORTGAGES 01-2 PLC (registered number 4270015), a public limited
      company incorporated under the laws of England and Wales whose
      registered office is at Fifth Floor, 100 Wood Street, London EC2V 7EX;

(6)   GRANITE MORTGAGES 02-1 PLC (registered number 4340767), a public limited
      company incorporated under the laws of England and Wales whose
      registered office is at Fifth Floor, 100 Wood Street, London EC2V 7EX;

(7)   GRANITE MORTGAGES 02-2 PLC (registered number 4482804), a public limited
      company incorporated under the laws of England and Wales whose
      registered office is at Fifth Floor, 100 Wood Street, London EC2V 7EX;

(8)   GRANITE MORTGAGES 03-1 PLC (registered number 4598035), a public limited
      company incorporated under the laws of England and Wales whose
      registered office is at Fifth Floor, 100 Wood Street, London EC2V 7EX;

(9)   GRANITE MORTGAGES 03-2 PLC (registered number 4684567), a public limited
      company incorporated under the laws of England and Wales whose
      registered office is at Fifth Floor, 100 Wood Street, London EC2V 7EX;

                                      1
<PAGE>

(10)  GRANITE MORTGAGES 03-3 PLC (registered number 4823268), a public limited
      company incorporated under the laws of England and Wales whose
      registered office is at Fifth Floor, 100 Wood Street, London EC2V 7EX;

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

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

(13)  LLOYDS TSB BANK PLC, acting through its office at City Office, Bailey
      Drive, Gillingham Business Park, Kent ME8 0LS, in its capacity as
      Account Bank and acting through its office at 25 Monument Street, London
      EC3R 8BQ in its capacity as Funding GIC Provider;

(14)  MOURANT & CO. CAPITAL (SPV) LIMITED, a private limited company
      incorporated under the laws of England and Wales whose registered office
      is 4 Royal Mint Court, London EC3N 4HJ, in its capacity as Corporate
      Services Provider;

(15)  NORTHERN ROCK PLC (registered number 03273685), acting through its
      office at Northern Rock House, Gosforth, Newcastle upon Tyne NE3 4PL, in
      its capacity (1) as the Previous Start-up Loan Provider, and (2) as
      Current Issuer Start-up Loan Provider;

(16)  GRANITE MORTGAGES 04-1 PLC (registered number 4959572), a public limited
      company incorporated under the laws of England and Wales whose
      registered office is at Fifth Floor, 100 Wood Street, London EC2V 7EX as
      Current Issuer.

NOW THIS DEED OF ACCESSION WITNESSES AS FOLLOWS

WHEREAS:

(A)   Pursuant to the terms of the Current Issuer Intercompany Loan
      Confirmation, the Current Issuer has agreed to make available to Funding
      the Current Issuer Intercompany Loan.

(B)   Pursuant to the terms of the Current Issuer Start-up Loan Agreement, the
      Current Issuer Start-up Loan Provider has agreed to grant to Funding the
      Current Issuer Start-up Loan.

                                      2
<PAGE>

(C)   This Deed is supplemental to the Funding Deed of Charge, pursuant to
      which Funding agreed to provide the Security Trustee with the benefit of
      the security described in the Funding Deed of Charge to secure Funding's
      obligations to the Funding Secured Creditors.

(D)   The terms of the Funding Deed of Charge permit Funding to secure its
      obligations to a New Funding Secured Creditor thereunder and (where such
      New Funding Secured Creditor is a New Issuer) permit Funding to create
      certain Security Interests in favour of the Security Trustee for the
      benefit of such New Funding Secured Creditor.

(E)   The Current Issuer Start-up Loan Provider and the Current Issuer, each
      of whom is a New Funding Secured Creditor, have agreed to enter into
      this Deed of Accession (this "Deed") to accede to the provisions of the
      Funding Deed of Charge.

(F)   The Current Issuer Note Trustee has agreed to enter into this Deed to
      accede to the provisions of the Funding Deed of Charge.

(G)   The Funding Secured Creditors have agreed to enter into this Deed to,
      among other things, acknowledge and agree to such accessions, permit any
      consequential changes to the Funding Priority of Payments set out in
      Part I, Part II and Part III of Schedule 3 of the Funding Deed of Charge
      as are required and any other amendment as may be required to give
      effect to this Deed and to acknowledge the Security Interests created
      hereunder.

1.    Interpretation

      The provisions of the Master Definitions Schedule as amended and
      restated by (and appearing in Appendix 1 to) the Master Definitions
      Schedule Seventh Amendment Deed made on 26 January 2004 between, among
      others, the Seller, Funding and the Mortgages Trustee (as the same have
      been and may be amended, varied or supplemented from time to time with
      the consent of the parties hereto) are expressly and specifically
      incorporated into and shall apply to this Agreement.

2.    Representations and Warranties

2.1   The Current Issuer hereby represents and warrants to the Security
      Trustee and each of the Funding Secured Creditors in respect of itself
      that as of the date of this Deed:

      (a)  pursuant to the terms of the Current Issuer Intercompany Loan
           Agreement, Funding has agreed to pay to the Current Issuer fees,
           interest and principal in accordance with the terms of the Current
           Issuer Intercompany Loan Agreement; and

                                      3
<PAGE>

      (b)  the Current Issuer Intercompany Loan Agreement expressly provides
           that all amounts due from Funding thereunder are to be secured by
           or pursuant to the Funding Deed of Charge.

2.2   The Current Issuer Start-up Loan Provider hereby represents and warrants
      to the Security Trustee and each of the Funding Secured Creditors in
      respect of itself that as of the date of this Deed:

      (a)  Funding has agreed to pay interest and repay principal to the
           Current Issuer Start-up Loan Provider in accordance with the terms
           of the Current Issuer Start-up Loan Agreement; and

      (b)  the Current Issuer Start-up Loan Agreement expressly provides that
           all amounts due from Funding thereunder are to be secured by or
           pursuant to the Funding Deed of Charge.

2.3   Funding hereby represents and warrants to the Security Trustee and each
      of the Funding Secured Creditors that as at the date of this Deed, the
      conditions to incurring further secured financial indebtedness set out
      in Clause 2.2 (New Intercompany Loan Agreements) of the Intercompany
      Loan Terms and Conditions are satisfied.

3.    Accession

3.1   In consideration of the Current Issuer New Funding Secured Creditors
      being accepted as Funding Secured Creditors for the purposes of the
      Funding Deed of Charge by the parties thereto as from the date of this
      Deed, each of the Current Issuer New Funding Secured Creditors:

      (a)  confirms that as from the date of this Deed, it will become and
           intends to be a party to the Funding Deed of Charge as a Funding
           Secured Creditor;

      (b)  undertakes to comply with and be bound by all of the provisions of
           the Master Definitions Schedule and the Current Issuer Master
           Definitions Schedule (as the same may be amended, varied or
           restated from time to time) and the Funding Deed of Charge in its
           capacity as a Funding Secured Creditor, as if it had been an
           original party thereto;

      (c)  undertakes to perform, comply with and be bound by all of the
           provisions of the Funding Deed of Charge in its capacity as a
           Funding Secured Creditor, as if it had been an original party
           thereto including, without limitation, Clause 20.3 (Funding Secured
           Creditors), Clause 8.3 (Funding Post-Enforcement Priority of
           Payments), Clause 8.6 (Security Trustee Rights upon Enforcement)
           and Clause 6 (Restrictions on Exercise of Certain Rights); and

                                      4
<PAGE>

      (d)  agrees that the Security Trustee shall be the Security Trustee of
           the Funding Deed of Charge for all Funding Secured Creditors upon
           and subject to the terms set out in the Funding Deed of Charge.

3.2   The Current Issuer Note Trustee:

      (a)  confirms that as of the date of this Deed, it becomes and intends
           to be party to the Funding Deed of Charge; and

      (b)  agrees to comply with and be bound by the provisions of the Funding
           Deed of Charge relating to the Note Trustee and agrees that all
           references to the Note Trustee in the Funding Deed of Charge and
           this Deed shall be construed as including the note trustee under
           the Current Issuer Deed of Charge and Current Issuer Trust Deed.

4.    Funding Security

4.1   Funding, by way of first fixed security for the payment or discharge of
      that portion of the Funding Secured Obligations which represent the
      obligations and liabilities of Funding to the Current Issuer under the
      Current Issuer Intercompany Loan Agreement, subject to Clause 4 (Release
      of Funding Charged Property) of the Funding Deed of Charge, hereby:

      (a)  assigns by way of first fixed security to the Security Trustee for
           the benefit of the Current Issuer all of its right, title, benefit
           and interest, present and future, in, to and under:

           (i)    the Funding (Current Issuer) Bank Account Agreement; and

           (ii)   the Funding (Current Issuer) Guaranteed Investment Contract,

                  including all rights to receive payment of any amounts which
                  may become payable to Funding thereunder and all payments
                  received by Funding thereunder including, without
                  limitation, all rights to serve notices and/or make demands
                  thereunder and/or to take such steps as are required to
                  cause payments to become due and payable thereunder and all
                  rights of action in respect of any breach thereof and all
                  rights to receive damages or obtain relief in respect
                  thereof and the proceeds of any of the foregoing, TO HOLD
                  the same unto the Security Trustee absolutely;

      (b)  assigns by way of first fixed security in favour of the Security
           Trustee for the benefit of the Current Issuer all of its rights,
           title, benefit and interest, present and future, in and to all
           monies now or at any time hereafter standing to the credit of the
           Funding (Current Issuer) GIC Account and the debts represented by
           them together with all rights and claims relating or attached
           thereto

                                      5
<PAGE>

           including, without limitation, the right to interest and the
           proceeds of any of the foregoing, TO HOLD the same unto the
           Security Trustee absolutely; and

      (c)  charges by way of first fixed security to the Security Trustee for
           the benefit of the Current Issuer all of its right, title, benefit
           and interest, present and future in, to and under any Authorised
           Investment purchased using monies standing to the credit of the
           Funding (Current Issuer) GIC Account and all rights in respect of
           or ancillary to such Authorised Investments, including the right to
           income and the proceeds of any of the foregoing, TO HOLD the same
           unto the Security Trustee absolutely.

4.2   (a)  Funding, by way of first fixed security for the payment or
           discharge of the Funding Secured Obligations, subject to Clause 4
           (Release of Funding Charged Property) of the Funding Deed of
           Charge, hereby assigns to the Security Trustee, save to the extent
           that the same may be situate in Jersey at any relevant time, all of
           its right, title, benefit and interest, present and future, in, to
           and under the Current Issuer Start-up Loan Agreement, including,
           without limitation, all rights to receive payment of any amounts
           which may become payable to Funding thereunder and all payments
           received by Funding thereunder, all rights to serve notices and/or
           make demands thereunder and/or to take such steps as are required
           to cause payments to become due and payable thereunder, all rights
           of action in respect of any breach thereof and all rights to
           receive damages or obtain relief in respect thereof and the
           proceeds of any of the foregoing, TO HOLD the same unto the
           Security Trustee absolutely.

      (b)  To the intent that the Security Trustee shall have a security
           interest in accordance with the Jersey Security Law (and as secured
           party for the purposes of such law) for the payment or discharge of
           the Funding Secured Obligations, subject to Clause 4 (Release of
           Funding Charged Property) of the Funding Deed of Charge, Funding
           (as debtor for the purposes of the Jersey Security Law) hereby
           assigns, to the extent that the same may be situate in Jersey at
           any relevant time to the Security Trustee all of its right, title,
           benefit and interest, present and future, in, to and under the
           Current Issuer Start-up Loan Agreement, including, without
           limitation, all rights to receive payment of any amounts which may
           become payable to Funding thereunder and all payments received by
           Funding thereunder, all rights to serve notices and/or make demands
           thereunder and/or to take such steps as are required to cause
           payments to become due and payable thereunder, all rights of action
           in respect of any breach thereof and all rights to receive damages
           or obtain relief in respect thereof and the proceeds of any of the
           foregoing, TO HOLD the same unto the Security Trustee absolutely.

                                      6
<PAGE>

5.    Title Guarantee

      Each of the dispositions of, assignments of and charges over, property
      effected in or pursuant to Clause 4 (Accounts for Issuers) is made with
      full title guarantee.

6.    Application

      Prior to and following enforcement of the Funding Security all amounts
      at any time held by Funding, the Cash Manager or the Security Trustee in
      respect of the security created under this Deed shall be held and/or
      applied by such person subject to and in accordance with the relevant
      provisions of the Funding Deed of Charge.

7.    Scope of the Funding Deed of Charge

      Funding, the Current Issuer New Funding Secured Creditors and the
      Funding Secured Creditors (including the Security Trustee) hereby agree
      that for the relevant purposes under the Funding Deed of Charge and the
      Master Definitions Schedule:

      (a)  the Current Issuer Intercompany Loan Agreement shall be treated as
           a Funding Transaction Document;

      (b)  the Current Issuer Start-up Loan Agreement shall be treated as a
           Funding Transaction Document;

      (c)  the Funding (Current Issuer) Bank Account Agreement shall be
           treated as a Funding Transaction Document;

      (d)  the Funding (Current Issuer) Guaranteed Investment Contract shall
           be treated as a Funding Transaction Document;

      (e)  the property and assets of Funding expressed to be assigned or
           charged pursuant to this Deed shall constitute Funding Charged
           Property; and

      (f)  each of the Current Issuer New Funding Secured Creditors shall be
           treated as a Funding Secured Creditor.

8.    Notices and Acknowledgements

      (a)  The execution of this Deed by the Current Issuer New Funding
           Secured Creditors shall constitute notice to such Current Issuer
           New Funding Secured Creditors of the assignments made by Funding
           pursuant to Clause 3 (Funding Security) of the Funding Deed of
           Charge. The execution of this Deed by each other Funding Secured
           Creditor shall constitute notice to such Funding Secured Creditor
           of the assignments made by Funding pursuant to this Deed.

                                      7
<PAGE>

      (b)  By its execution of this Deed, each of the Current Issuer New
           Funding Secured Creditors acknowledges that it has notice of and
           consents to the assignments, charges and Security Interests
           (including the Jersey Security Interests) made or granted by
           Funding pursuant to Clause 3 (Funding Security) of the Funding Deed
           of Charge and also acknowledges that as at the date hereof it has
           not received from any other person any notice of any assignment or
           charge of any of the property the subject of such Security
           Interests. By its execution of this Deed, each other Funding
           Secured Creditor acknowledges that it has notice of and consents to
           the assignments, charges and Security Interests made or granted by
           Funding pursuant to this Deed and also acknowledges that as at the
           date hereof it has not received from any other person any notice of
           any assignment or charge of any of the property the subject of such
           Security Interests.

      (c)  Notwithstanding the assignments and charges granted pursuant to
           Clause 3 (Funding Security) of the Funding Deed of Charge or
           pursuant to this Deed, the parties hereto acknowledge that, subject
           as provided otherwise in the Funding Deed of Charge, each Funding
           Secured Creditor and each other party to any Funding Transaction
           Document may continue to make all payments becoming due to Funding
           under any Funding Transaction Document in the manner envisaged by
           such Funding Transaction Document until the receipt of written
           notice from the Security Trustee or any Receiver requiring payments
           to be made otherwise.

9.    Amendment to the Funding Priority of Payments

      The Funding Secured Creditors agree to amend and restate the Funding
      Priority of Payments set out in Part I and Part II of Schedule 3 of the
      Funding Deed of Charge in accordance with Appendix 1 hereto.

10.   Notices and Demands

      Any notice or communication under or in connection with this Deed shall
      be given in the manner and at the times set out in Clause 24 (Notices)
      of the Funding Deed of Charge. For the purposes of such Clause 24
      (Notices), as at the date of this Deed the relevant contact details for
      the Current Issuer are:

           Granite Mortgages 04-1 plc
           Fifth Floor
           100 Wood Street
           London EC2V  7EX

           For the attention of:  The Company Secretary

                                      8
<PAGE>

           Telephone:        +44 020 7606 5451
           Facsimile:        +44 020 7606 0643

      and for the Current Issuer Start-up Loan Provider are:

           Northern Rock PLC
           Northern Rock House
           Gosforth
           Newcastle upon Tyne
           NE3 4PL

           For the attention of:  The Group Secretary

           Facsimile:        +44 (0)191 213 2203

      and for the Current Issuer Note Trustee are:

           The Bank of New York
           48th Floor, One Canada Square
           London E14 5AL

           For the attention of:  Corporate Trust (Global Structured Finance)

           Facsimile:        +44 (020) 7964 6399.

11.   Non Petition Covenant

      Each of the parties hereto hereby agrees that it shall not institute
      against Funding, the Mortgages Trustee or any Issuer any winding-up,
      administration, insolvency or similar proceedings in any jurisdiction
      for so long as any sum is outstanding under any Intercompany Loan
      Agreement of any Issuer or for two years plus one day since the last day
      on which any such sum was outstanding provided that the Security Trustee
      may prove or lodge a claim in the event of a liquidation initiated by
      any other person. The provisions of Clause 6 (Restrictions on Exercise
      of Certain Rights) of the Funding Deed of Charge shall prevail in the
      event that and to the extent that they conflict with the provisions of
      this Clause.

                                      9
<PAGE>

12.   Third Party Rights

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

13.   Execution in Counterparts

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

14.   Governing Law and Jurisdiction; Appropriate Forum

14.1  This Deed is governed by and shall be construed in accordance with
      English law save that those parts of this Deed concerned with the
      creation, subsistence or enforcement of Jersey Security Interests shall
      be governed by and in accordance with Jersey law.

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

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

15.   Process Agents

      Funding irrevocably and unconditionally appoints Mourant & Co. Capital
      (SPV) Limited at 4 Royal Mint Court, London EC3N 4HJ or otherwise at the
      registered office of Mourant & Co. Capital (SPV) Limited for the time
      being as its agent for service of process in England in respect of any
      proceedings in respect of this Agreement and undertakes that in the
      event of Mourant & Co. Capital (SPV) Limited ceasing so to act it will
      appoint another person with a registered office in London as its agent
      for service of process.

                                      10
<PAGE>

DULY EXECUTED AND DELIVERED AS A DEED by each of the parties hereto or on its
behalf on the date appearing on page one.

<TABLE>
<CAPTION>
Funding

<S>                                                                     <C>
Executed by
GRANITE FINANCE FUNDING LIMITED
as its deed as follows:                                                    By
Signed for and on its behalf by one of its directors and by                  ------------------------------------------------------
another of its directors/its secretary                                       Director

                                                                         Name
                                                                             ------------------------------------------------------

                                                                           By
                                                                             ------------------------------------------------------
                                                                             Director/Secretary

                                                                         Name
                                                                             ------------------------------------------------------

The Security Trustee/The Note Trustee in respect of the Previous Issuers
and the Current Issuer Note Trustee

Executed by
THE BANK OF NEW YORK
as its deed as follows:                                                    By
Signed for and on its behalf by one of its duly authorised                   ------------------------------------------------------
signatories
                                                                         Name
                                                                             ------------------------------------------------------

Executed by
GRANITE MORTGAGES 01-1 PLC
as its deed as follows:                                                    By
Signed for and on its behalf by one of its directors and by                  ------------------------------------------------------
another of its directors/its secretary                                       for and on behalf of LDC Securitisation Director
                                                                             No.1 Ltd

                                                                        Name Clive Rakestrow
                                                                             ------------------------------------------------------

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

                                                                        Name Ian Bowden
                                                                             ------------------------------------------------------

                                                                 11
<PAGE>

Executed by
GRANITE MORTGAGES 01-2 PLC
as its deed as follows:                                                    By
Signed for and on its behalf by one of its directors and by                  ------------------------------------------------------
another of its directors/its secretary                                       for and on behalf of LDC Securitisation Director
                                                                             No.1 Ltd

                                                                        Name Clive Rakestrow
                                                                             ------------------------------------------------------

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

                                                                        Name Ian Bowden
                                                                             ------------------------------------------------------

Executed by
GRANITE MORTGAGES 02-1 PLC
as its deed as follows:                                                    By
Signed for and on its behalf by one of its directors and by                  ------------------------------------------------------
another of its directors/its secretary                                       for and on behalf of LDC Securitisation Director
                                                                             No.1 Ltd

                                                                        Name Clive Rakestrow
                                                                             ------------------------------------------------------

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

                                                                        Name Ian Bowden
                                                                             ------------------------------------------------------

Executed by
GRANITE MORTGAGES 02-2 PLC
as its deed as follows:                                                    By
Signed for and on its behalf by one of its directors and by                  ------------------------------------------------------
another of its directors/its secretary                                       for and on behalf of LDC Securitisation Director
                                                                             No.1 Ltd

                                                                        Name Clive Rakestrow
                                                                             ------------------------------------------------------

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

                                                                        Name Ian Bowden
                                                                             ------------------------------------------------------

                                                                 12
<PAGE>

Executed by
GRANITE MORTGAGES 03-1 PLC
as its deed as follows:                                                    By
Signed for and on its behalf by one of its directors and by                  ------------------------------------------------------
another of its directors/its secretary                                       for and on behalf of LDC Securitisation Director
                                                                             No.1 Ltd

                                                                        Name Clive Rakestrow
                                                                             ------------------------------------------------------

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

                                                                         NameIan Bowden
                                                                             ------------------------------------------------------

Executed by
GRANITE MORTGAGES 03-2 PLC
as its deed as follows:                                                    By
Signed for and on its behalf by one of its directors and by                  ------------------------------------------------------
another of its directors/its secretary                                       for and on behalf of LDC Securitisation Director
                                                                             No.1 Ltd

                                                                        Name Clive Rakestrow
                                                                             ------------------------------------------------------

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

                                                                        Name Ian Bowden
                                                                             ------------------------------------------------------

Executed by
GRANITE MORTGAGES 03-3 PLC
as its deed as follows:                                                    By
Signed for and on its behalf by one of its directors and by                  ------------------------------------------------------
another of its directors/its secretary                                       for and on behalf of LDC Securitisation Director
                                                                             No.1 Ltd

                                                                        Name Clive Rakestrow
                                                                             ------------------------------------------------------

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

                                                                        Name Ian Bowden
                                                                             ------------------------------------------------------

                                                                 13
<PAGE>

Current Issuer

Executed by
GRANITE MORTGAGES 04-1 PLC
as its deed as follows:                                                    By
Signed for and on its behalf by one of its directors and by                  ------------------------------------------------------
another of its directors/its secretary                                       for and on behalf of LDC Securitisation Director
                                                                             No.1 Ltd

                                                                        Name Clive Rakestrow
                                                                             ------------------------------------------------------

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

                                                                        Name Ian Bowden
                                                                             ------------------------------------------------------

The Cash Manager, the Previous Start-up Loan Provider and
the Current Issuer Start-up Loan Provider

Executed by
northern rock plc
as its deed as follows:                                                    By
Signed for and on its behalf by one of its duly authorised                   ------------------------------------------------------
attorneys/signatories                                                        Duly Authorised Attorney/Signatory

                                                                         Name
                                                                             ------------------------------------------------------
Signature
             -----------------------------------------------------
             Witness
Full name
             -----------------------------------------------------
Occupation   Solicitor
             -----------------------------------------------------
Address      c/o Sidley Austin Brown & Wood
             -----------------------------------------------------
             1 Threadneedle Street
             -----------------------------------------------------
             London EC2R 8AW
             -----------------------------------------------------

The Corporate Services Provider

Executed by
MOURANT & CO. CAPITAL (SPV) LIMITED
as its deed as follows:                                                    By
Signed for and on its behalf by one of its directors and by                  ------------------------------------------------------
another of its directors/its secretary                                       Director

                                                                         Name
                                                                             ------------------------------------------------------

                                                                           By
                                                                             ------------------------------------------------------
                                                                             Director/Secretary

                                                                         Name
                                                                             ------------------------------------------------------

                                                                 14
<PAGE>

The Account Bank and the Funding GIC Provider

Executed by
LLOYDS TSB BANK PLC
as its deed as follows:                                                    By
Signed for and on its behalf by one of its duly authorised                   ------------------------------------------------------
attorneys/signatories                                                        Duly Authorised Attorney/Signatory

                                                                         Name
                                                                             ------------------------------------------------------

Signature
             -----------------------------------------------------
             Witness
Full name
             -----------------------------------------------------
Occupation   Solicitor
             -----------------------------------------------------
Address      c/o Sidley Austin Brown & Wood
             -----------------------------------------------------
             1 Threadneedle Street
             -----------------------------------------------------
             London EC2R 8AW
             -----------------------------------------------------

The Mortgages Trustee

Executed by                                                                By
GRANITE FINANCE TRUSTEES LIMITED
as its deed as follows:
Signed for and on its behalf by one of its directors and by
another of its directors/its secretary
                                                                             ------------------------------------------------------
                                                                             Director

                                                                         Name
                                                                             ------------------------------------------------------

                                                                           By
                                                                             ------------------------------------------------------
                                                                             Director/Secretary

                                                                         Name
                                                                             ------------------------------------------------------
</TABLE>

                                                                 15
<PAGE>

                                  SCHEDULE I

                        Utilisation of Issuer Reserves

Reserves for Current Issuer

1.    Current Issuer Reserve Fund:

1.1   Prior to enforcement of the Current Issuer Security, the Current Issuer
      Reserve Fund shall only be applied on any Payment Date to increase that
      portion of Funding Available Revenue Receipts which are allocated to the
      Current Issuer to make payments of interest and fees due under the
      Current Issuer Intercompany Loan.

1.2   Following enforcement of the Current Issuer Security, to the extent not
      applied on a Payment Date in accordance with 1.1 above, amounts standing
      to the credit of the Current Issuer Reserve Fund Ledger shall only be
      applied in making payments of principal due under the Current Issuer
      Intercompany Loan (but not in respect of any other Intercompany Loan of
      any other Issuer) .

2.    Current Issuer Liquidity Reserve Fund:

2.1   Prior to enforcement of the Current Issuer Security, the Current Issuer
      Liquidity Reserve Fund (if any is required to be established) shall only
      be applied on any Payment Date to:

      (a)  help meet any deficit in Funding Available Revenue Receipts which
           are allocated to the Current Issuer to pay amounts due under the
           Current Issuer Intercompany Loan, but only to the extent necessary
           to fund the payment by the Current Issuer of interest and fees due
           on the relevant Interest Payment Date in respect of the Class A
           Notes and/or the Class B Notes and to credit the Class A Principal
           Deficiency Sub Ledger;

      (b)  (provided that there are no Class A Notes outstanding) help meet
           any deficit in Funding Available Revenue Receipts which are
           allocated to the Current Issuer to pay interest and fees due on the
           Current Issuer Intercompany Loan; and

      (c)  help meet any deficit in Funding Available Principal Receipts which
           are allocated to the Current Issuer to pay all principal due on the
           Final Maturity Date of the Series 1 Class A1 Notes.

2.2   Following enforcement of the Current Issuer Security, to the extent not
      applied on a Payment Date in accordance with 2.1 above, amounts standing
      to the credit of the Current Issuer Liquidity Reserve Ledger shall only
      be applied in making payments of principal due under the Current Issuer
      Intercompany Loan (but not in respect of any other Intercompany Loan of
      any other Issuer).

                                      16
<PAGE>

                                  APPENDIX 1
               Amended and Restated Funding Priority of Payments

                                    Part I

             Funding Pre-Enforcement Revenue Priority of Payments

Distribution of Funding Available Revenue Receipts prior to Enforcement of the
Funding Security

On each Payment Date or, in respect of amounts due to third parties by Funding
under paragraph (B), when due, prior to enforcement of the Funding Security,
the Cash Manager will, subject to the rules for application of Funding
Available Revenue Receipts (set out below), apply Group 1 Available Revenue
Receipts, Group 2 Available Revenue Receipts and amounts standing to the
credit of the Funding Expense Sub-Ledger, as applicable, in the following
order of priority (the "Funding Pre-Enforcement Revenue Priority of
Payments"):

      (A)  first, to pay amounts due to the Security Trustee (together with
           interest and (to the extent not already inclusive) VAT on those
           amounts) and to provide for any amounts due or to become due during
           the following Interest Period to the Security Trustee, under the
           Funding Deed of Charge or any other Transaction Document;

      (B)  second, to pay amounts due to any third party creditors of Funding
           (other than those referred to later in this order of priority of
           payments or in the Funding Pre-enforcement Principal Priority of
           Payments) of which the Cash Manager has notice prior to the
           relevant Payment Date, which amounts have been incurred without
           breach by Funding of the Transaction Documents to which it is a
           party (and for which payment has not been provided for elsewhere)
           and to provide for any such amounts expected to become due and
           payable by Funding during the following Interest Period and to pay
           or discharge any liability of Funding for corporation tax on any
           chargeable income or gain of Funding;

      (C)  third, towards payment of amounts due to the Cash Manager under the
           Cash Management Agreement (together with (to the extent not already
           inclusive) VAT on those amounts);

      (D)  fourth, in no order of priority among them, but in proportion to
           the respective amounts due, towards payment of amounts, if any, due
           to the Account Bank under the terms of the Bank Account Agreement
           and to the Corporate Services Provider under the Corporate Services
           Agreement;

                                      17
<PAGE>

      (E)  fifth, to pay, in no order of priority among them, to each Issuer
           an amount up to its Issuer Allocable Revenue Receipts in respect of
           interest and fees due on that Issuer's Intercompany Loan but not
           exceeding the aggregate amount of, and to be applied in the amounts
           and priorities set forth in, the Issuer Pre-Liquidity Payments for
           that Issuer;

      (F)  sixth, to pay, in no order of priority among them, such amount for
           each Issuer up to its Issuer Allocable Revenue Receipts as is
           necessary to replenish the Issuer Liquidity Reserve Fund, if any,
           established in respect of that Issuer up to the Issuer Liquidity
           Reserve Required Amount (but only to the extent that monies have
           been drawn from the relevant Issuer Liquidity Reserve Fund to pay
           interest and fees due under the relevant Intercompany Loan and only
           to replenish the Issuer Liquidity Reserve Fund of an Issuer to the
           extent that there are Class A Notes issued by the such Issuer
           outstanding on such Payment Date);

      (G)  seventh, to pay, in no order of priority among them, to each Issuer
           an amount up to its Issuer Allocable Revenue Receipts in respect of
           interest and fees due on that Issuer's Intercompany Loan but not
           exceeding the aggregate amount of, and to be applied in the amounts
           and priorities set forth in, the Issuer Post-Liquidity Payments for
           that Issuer;

      (H)  eighth, to pay, in no order of priority among them, such amount for
           each Issuer up to its Issuer Allocable Revenue Receipts as is
           necessary to fund the Issuer Reserve Fund established in respect of
           that Issuer up to the Issuer Reserve Required Amount or to
           replenish such Issuer Reserve Fund up to the related Issuer Reserve
           Required Amount (to the extent that monies have been drawn from
           such Issuer Reserve Fund to pay interest and fees under the
           relevant Intercompany Loan);

      (I)  ninth, to pay in no order of priority among them, to each Issuer an
           amount up to its Issuer Allocable Revenue Receipts in respect of
           interest, principal (in the case of the Special Repayment Notes)
           and fees due on that Issuer's Intercompany Loan but not exceeding
           the aggregate amount of, and to be applied in the amounts and
           priorities set forth in, the Issuer Pre-Reserve Payments for that
           Issuer;

      (J)  tenth, in no order of priority among them, from Issuer Allocable
           Revenue Receipts, to credit the Funding Reserve Ledger in an amount
           up to the Funding Reserve Required Amount;

      (K)  eleventh, to pay to each Issuer, in no order of priority among them
           but in proportion to the respective amounts due, an amount up to
           its Issuer Allocable

                                      18
<PAGE>

           Revenue Receipts in respect of interest and fees due on that
           Issuer's Intercompany Loan but not exceeding the aggregate amount
           of, and to be applied in the amounts and priorities set forth in,
           the Issuer Post-Reserve Payments for that Issuer;

      (L)  twelfth, in no order of priority among them, but in proportion to
           the respective amounts due, from Issuer Allocable Revenue Receipts,
           towards payment of interest and principal amounts due to each
           Issuer Start-up Loan Provider under the relevant Issuer Start-up
           Loan Agreement;

      (M)  thirteenth, in no order of priority among them, but in proportion
           to the respective amounts due, to pay to each Issuer an amount up
           to its Issuer Allocable Revenue Receipts in respect of interest and
           fees and any other amount (if any) due on that Issuer's
           Intercompany Loan but not exceeding the aggregate amount of, and to
           be applied in the amounts and priorities set forth in, the Issuer
           Post Start-up Payments for that Issuer;

      (N)  fourteenth, to the extent required, to apply, on the Payment Date
           for Group 1 Issuers, all Group 1 Shared Issuer Revenue Receipts or,
           on the Payment Date for Group 2 Issuers, Group 2 Shared Issuer
           Revenue Receipts, as applicable, in the priorities set forth in
           items (E) through (M) above;

      (O)  fifteenth, towards payment to Funding of an amount equal to 0.01%
           per annum of the Funding Available Revenue Receipts, which amount
           will be retained by Funding as profit less corporation tax in
           respect of those profits provided for or paid at item (B) above;

      (P)  sixteenth, towards payment of any Deferred Contribution due to the
           Mortgages Trustee pursuant to the terms of the Mortgages Trust
           Deed; and

      (Q)  last, towards payment to the shareholders of Funding of any
           dividend declared by Funding.

PROVIDED THAT no amount will be applied in replenishing any of the reserve
funds held by Funding in respect of an Issuer under paragraphs (F) and/or (H)
above following an enforcement of the Issuer Security relating to that Issuer.

For the avoidance of doubt, references to the Issuer Allocable Revenue
Receipts for a particular Issuer in items (E) through (M) (inclusive) above
shall be reduced by any amounts already allocated to that Issuer in the above
Priority of Payments on that Payment Date.

                                      19
<PAGE>

Rules for application of Funding Available Revenue Receipts

(1)   (A)  Subject as provided in paragraphs (2) through (9) below, the
           portion of Issuer Allocable Revenue Receipts for all Group 1
           Issuers remaining after item (M) of the Funding Pre-Enforcement
           Revenue Priority of Payments, together with any additional Funding
           Available Revenue Receipts under paragraph (3) below, shall
           constitute "Group 1 Shared Issuer Revenue Receipts". Group 1 Shared
           Issuer Revenue Receipts will be reallocated by the Cash Manager on
           a Payment Date for Group 1 Issuers in accordance with item (N) of
           the Funding Pre-Enforcement Revenue Priority of Payments and will
           continue to be distributed on such Payment Date in accordance with
           items (E) through (M) of the Funding Pre-Enforcement Revenue
           Priority of Payments until there are no remaining amounts of Group
           1 Shared Issuer Revenue Receipts to be reallocated and distributed
           on such Payment Date. If there is more than one Group 1 Issuer that
           is entitled to Group 1 Shared Issuer Revenue Receipts then each
           such Group 1 Issuer will be reallocated a portion of the Group 1
           Shared Issuer Revenue Receipts equal to:

<TABLE>
<CAPTION>
           <S>                                                  <C>
                                                                Outstanding Principal Balance of
                                                                the Intercompany Loan of such Group 1 Issuer
           Amount of Shared Group 1 Issuer Revenue Receipts  x  ---------------------------------------------
                                                                Aggregate Outstanding Principal Balance of
                                                                the Intercompany Loans of all Group 1 Issuers
</TABLE>

      (B)  Subject as provided in paragraphs (2) through (4) below, the
           portion of Issuer Allocable Revenue Receipts for all Group 2
           Issuers remaining after item (M) of the Funding Pre-Enforcement
           Revenue Priority of Payments, together with any additional Funding
           Available Revenue Receipts under paragraph (3) below, shall
           constitute "Group 2 Shared Issuer Revenue Receipts". Group 2 Shared
           Issuer Revenue Receipts will be reallocated by the Cash Manager on
           a Payment Date for Group 2 Issuers distributed on such Payment Date
           in accordance with item (N) of the Funding Pre-Enforcement Revenue
           Priority of Payments and will continue to be distributed on such
           Payment Date in accordance with items (E) through (M) of the
           Funding Pre-Enforcement Revenue Priority of Payments until there
           are no remaining amounts of Group 2 Shared Issuer Revenue Receipts
           to be reallocated and distributed on such Payment Date. If there is
           more than one Group 2 Issuer that is entitled to Group 2 Shared
           Issuer Revenue Receipts, then each such Group 2 Issuer will be
           reallocated a portion of Shared Issuer Revenue Receipts equal to:

                                      20
<PAGE>

<TABLE>
<CAPTION>
           <S>                                                  <C>
                                                                Outstanding Principal Balance of
                                                                the Intercompany Loan of such Group 2 Issuer
           Amount of Shared Group 2 Issuer Revenue Receipts  x  ---------------------------------------------
                                                                Aggregate Outstanding Principal Balance of
                                                                the Intercompany Loans of all Group 2 Issuers
</TABLE>

(2)   No Issuer shall be entitled to or shall receive any amount of Issuer
      Allocable Revenue Receipts from Funding on a Payment Date on which such
      Issuer is not required by that Issuer to make a payment on that date in
      accordance with the relevant Issuer Pre-Enforcement Revenue Priority of
      Payments or other relevant Issuer Priority of Payments which applies to
      that Issuer on that date, and the Cash Manager will take account of all
      of the funds which are or will become available to that Issuer on that
      Payment Date and which constitute Issuer Available Revenue Receipts
      (including any payments due under any Swap Agreement and any interest or
      other income received or to be received) for that Issuer for the purpose
      of making this determination.

(3)   Unless and until the Intercompany Loan of any Issuer has been repaid in
      full and Funding has no further liability under the relevant
      Intercompany Loan Agreement, amounts standing to the credit of the
      Issuer Reserve Ledger and the Issuer Liquidity Reserve Ledger, if any,
      established by Funding for that Issuer may only be utilized by Funding
      in making payments due under that Issuer's Intercompany Loan and may not
      be used in or towards the payment of any other liability of Funding. On
      the Payment Date following the repayment in full of the Intercompany
      Loan of that Issuer and provided that Funding has no further liability
      in respect of the relevant Intercompany Loan Agreement, any remaining
      amounts standing to the credit of the Issuer Reserve Ledger and the
      Issuer Liquidity Reserve Ledger, if any, of that Issuer will constitute
      additional Funding Available Revenue Receipts for the purpose of
      paragraphs (N) through (Q) of the Funding Pre-Enforcement Revenue
      Priority of Payments and may be utilized by Funding in paying any other
      liability of Funding subject to and in accordance with the relevant
      Funding Priority of Payments.

(4)   If on any Payment Date any Issuer Allocable Revenue Receipts and/or any
      Group 1 Shared Issuer Revenue Receipts or Group 2 Shared Issuer Revenue
      Receipts, as applicable, are paid to an Issuer and are applied by that
      Issuer, in reducing any deficiency recorded on the Issuer Principal
      Deficiency Ledger of that Issuer (but only to the extent that any
      deficiency which has arisen as a result of (i) losses on the Mortgage
      Loans allocated by Funding to the Issuer and/or (ii) the application of
      Funding Available Principal Receipts to fund the Issuer Liquidity
      Reserve Fund of the Issuer, but not as a result of any other principal
      deficiency of the Issuer), then the Issuer Allocable Revenue Receipts
      and/or Group 1 Shared Issuer Revenue Receipts or Group 2 Shared Issuer
      Revenue Receipts, as applicable, so applied shall constitute

                                      21
<PAGE>

      repayments of principal under the relevant Intercompany Loan and shall
      reduce the Outstanding Principal Balance of that Intercompany Loan
      accordingly.

      To the extent that (a) an amount payable to an Issuer pursuant to the
      Funding Pre-Enforcement Revenue Priority of Payments on any Payment Date
      would, in accordance with the Issuer Pre-Enforcement Revenue Priority of
      Payments relating to the Issuer, be credited by the Issuer to its Issuer
      Principal Deficiency Ledger, and (b) the amount to be treated as
      principal as a result of making such credit would result in the Issuer
      Available Principal Receipts of that Issuer on that Payment Date being
      in excess of the Principal Amount to be repaid by that Issuer in respect
      of its Notes on that Payment Date, then an amount equal to that excess
      shall be reapplied by Funding as Group 1 Available Principal Receipts or
      Group 2 Available Principal Receipts, as applicable.

(5)   The Cash Manager will distribute Group 1 Available Revenue Receipts only
      on each Payment Date for Group 1 Issuers and Group 2 Available Revenue
      Receipts only on each Payment Date for Group 2 Issuers. Group 1
      Available Revenue Receipts and Group 2 Available Revenue Receipts will
      be applied (subject to paragraph (7) below) to pay amounts set forth in
      paragraphs (E)-(Q) of the Funding Pre-Enforcement Revenue Priority of
      Payments and (D)-(G) of the Funding Post-Enforcement Priority of
      Payments.

(6)   All references to an "Issuer" or "Issuers" in the Funding
      Pre-Enforcement Revenue Priority of Payments shall be construed to refer
      to an Issuer or Issuers in Group 1 on a Payment Date for Group 1 Issuers
      and in Group 2 on a Payment Date for Group 2 Issuers.

(7)   On Payment Dates for both Group 1 Issuers and Group 2 Issuers, the Cash
      Manager will apply amounts standing to the credit of the Funding Expense
      Sub-Ledger on the immediately preceding Distribution Date to pay the
      amounts set forth in paragraphs (A)-(D) of the Funding Pre-Enforcement
      Revenue Priority of Payments and paragraph (A)-(C) of the Funding
      Post-Enforcement Priority of Payments.

(8)   To the extent that on any Payment Date for Group 1 Issuers or Payment
      Date for Group 2 Issuers amounts standing to the credit of the Funding
      Expense Sub-Ledger distributed pursuant to paragraph (7) above are
      insufficient to pay all amounts described in such paragraph (7), then
      the Cash Manager will apply amounts standing to the credit of the
      Funding Reserve Ledger to meet such a shortfall. To the extent that on
      any Payment Date amounts standing to the credit of the Funding Reserve
      Ledger and applied pursuant to the preceding sentence are insufficient
      to pay all amounts described in paragraph (7) above, then the Cash
      Manager will apply on the Payment Date for Group 1 Issuers, Group 1
      Available Revenue Receipts or on the Payment Date for Group 2 Issuers,
      Group 2 Available Revenue Receipts, as applicable, to pay such amounts.
      To the extent that amounts standing to the credit of the Funding Reserve
      Ledger are applied to pay any amounts described in paragraph (7) above
      then the amounts standing to the credit of the Funding Reserve Ledger as
      at the Distribution Date immediately preceeding the relevant Payment
      Date

                                      22
<PAGE>

      (unless such Payment Date is also a Funding Reserve Adjustment Date, in
      which case the relevant date will be the Distribution Date immediately
      preceding the immediately preceding Payment Date) above shall be deemed
      to have been reduced by the amount applied to pay amounts described in
      paragraph 7 above.

(9)   Group 1 Available Revenue Receipts may not be used to make payments to
      Group 2 Issuers and Group 2 Available Revenue Receipts may not be used
      to make payments to Group 1 Issuers.

                                      23
<PAGE>

                                    Part II

            Funding Pre-Enforcement Principal Priority of Payments

On each Payment Date prior to enforcement of the Funding Security, the Cash
Manager will, subject to the rules for application of Funding Available
Principal Receipts set forth below, apply Group 1 Available Principal Receipts
or Group 2 Available Principal Receipts, as applicable, as follows (the
"Funding Pre-Enforcement Principal Priority of Payments"):

(1)   On each Payment Date for Group 1 Issuers, Group 1 Available Principal
      Receipts to each Group 1 Issuer in the following order of priority:

      (A)  first, to fund or replenish, as the case may be, the Issuer
           Liquidity Reserve Fund, if any, of each Group 1 Issuer up to the
           Issuer Liquidity Reserve Required Amount but only from and to the
           extent of the Issuer Allocable Principal Receipts for that Issuer;

      (B)  second, to pay to (or, if required under that Issuer's Intercompany
           Loan, set aside for) each Group 1 Issuer an amount up to its Issuer
           Allocable Principal Receipts in respect of principal due (or, if
           required under that Issuer's Intercompany Loan, to become due) on
           that Issuer's Intercompany Loan, which shall be an amount up to the
           aggregate amount of, and shall be applied in the amounts and
           priorities set forth in, the Issuer Principal Payments for that
           Issuer;

      (C)  third, to pay to (or, if required under that Issuer's Intercompany
           Loan, set aside for) each Group 1 Issuer an amount up to its
           allocable portion of Group 1 Shared Issuer Principal Receipts in
           respect of principal due (or, if required under that Issuer's
           Intercompany Loan, to become due) on that Issuer's Intercompany
           Loan, which in the case of that Group 1 Issuer shall be an amount
           up to the aggregate amount of, and shall be applied in the amounts
           and priorities set forth in, the Issuer Principal Payments for that
           Issuer until there are no remaining Group 1 Available Principal
           Receipts on such Payment Date; and

      (D)  last, to credit any remaining amounts to the Funding Principal
           Ledger.

(2)   On each Payment Date for Group 2 Issuers, Group 2 Available Principal
      Receipts to each Group 2 Issuer in the following order of priority:

      (A)  first, to fund (either initially or to replenish, as the case may
           be) the Issuer Liquidity Reserve Fund, if any, of each Group 2
           Issuer up to the Issuer Liquidity Reserve Required Amount but only
           from and to the extent of the Issuer Allocable Principal Receipts
           for that Issuer;

                                      24
<PAGE>

      (B)  second, to pay to (or, if required under that Issuer's Intercompany
           Loan, set aside for) each Group 2 Issuer an amount up to its Issuer
           Allocable Principal Receipts in respect of principal due (or, if
           required under that Issuer's Intercompany Loan, to become due) on
           that Issuer's Intercompany Loan, which shall be an amount up to the
           aggregate amount of, and shall be applied in the amounts and
           priorities set forth in, the Issuer Principal Payments for that
           Issuer;

      (C)  third, to pay to (or, if required under the Issuer's Intercompany
           Loan, set aside for) each Group 2 Issuer an amount up to its
           allocable portion of Group 2 Shared Issuer Principal Receipts in
           respect of principal due (or, if required under that Issuer's
           Intercompany Loan, to become due) on that Issuer's Intercompany
           Loan, which in the case of that Group 2 Issuer shall be an amount
           up to the aggregate amount of, and shall be applied in the amounts
           and priorities set forth in, the Issuer Principal Payments for that
           Issuer until there are no remaining Group 2 Available Principal
           Receipts on such Payment Date; and

      (D)  last, to credit any remaining amounts to the Funding Principal
           Ledger.

PROVIDED THAT no amount will be applied in replenishing the Issuer Liquidity
Reserve Fund held by Funding in respect of an Issuer under paragraphs (1)(A)
or (2)(A) above following an enforcement of the Issuer Security relating to
that Issuer.

Rules for application of Funding available principal receipts

(1)   (A) On the Distribution Date immediately preceding a Payment Date for
      Group 1 Issuers, the Cash Manager will calculate the "Issuer Allocable
      Principal Receipts" for each such Issuer in respect of the relevant
      Payment Date which, subject as provided in paragraphs (2) through (8)
      below, is for any Issuer an amount which is equal to the sum of:

      (a)  the aggregate of:

           (i)    for any Group 1 Issuer, the amount, if any, by which the
                  Issuer Liquidity Reserve Fund relating to that Issuer will
                  be less than the Issuer Liquidity Reserve Required Amount in
                  each case prior to the distribution of Group 1 Available
                  Principal Receipts on the Payment Date for Group 1 Issuers
                  immediately succeeding such Distribution Date; and

           (ii)   for any Group 1 Issuer which has a Money Market Note still
                  outstanding up to the amount equal to the Controlled
                  Amortization

                                      25
<PAGE>

                  Amount due on such Money Market Note, if any, on the Payment
                  Date for Group 1 Issuers immediately succeeding such
                  Distribution Date;

      (b)  for any Group 1 Issuer, an amount equal to the lesser of:

           (i)    (only if relevant) the principal amount due on the
                  Intercompany Loan of such Issuer which is an amount equal to
                  the Controlled Amortisation Amount due, if any, on the
                  Payment Date for Group 1 Issuers immediately succeeding such
                  Distribution Date (excluding any amount calculated in
                  accordance with paragraph 1(A)(a)); and

           (ii)   an amount equal to:

<TABLE>
<CAPTION>
                  <S>                                                               <C>
                  Group 1 Available Principal Receipts minus the aggregate          Outstanding Principal Balance on such
                  amount under (1)(A)(a) above in respect of the relevant     x      Group 1 Issuer's Intercompany Loan
                  Issuer on such Payment Date                                       -------------------------------------
                                                                                        Aggregate Outstanding Principal
                                                                                     Balance of all Intercompany Loans of
                                                                                                Group 1 Issuers
</TABLE>

      (B)  On the Distribution Date immediately preceding a Payment Date for
           Group 2 Issuers, the Cash Manager will calculate the "Issuer
           Allocable Principal Receipts" for each such Issuer in respect of
           the relevant Payment Date which, subject as provided in paragraphs
           (2) through (8) below, is an amount which is equal to the sum of:

      (a)  the aggregate of:

           (i)    for any Group 2 Issuer, the amount, if any, by which the
                  Issuer Liquidity Reserve Fund relating to that Issuer will
                  be less than the Issuer Liquidity Reserve Required Amount in
                  each case prior to the distribution of Group 2 Available
                  Principal Receipts on the Payment Date for Group 2 Issuers
                  immediately succeeding such Distribution Date; and

           (ii)   for any Group 2 Issuer which has a Money Market Note still
                  outstanding, up to the amount equal to the Controlled
                  Amortization Amount due on each Money Market Note, if any,
                  on the Payment Date for Group 2 Issuers immediately
                  succeeding such Distribution Date; and

      (b)  for any Group 2 Issuer, an amount equal to the lesser of:

           (i)    (only if relevant) the principal amount due on the
                  Intercompany Loan of such Issuer which is an amount equal to
                  the Controlled Amortization Amount due, if any, on the
                  Payment Date for Group 2 Issuers immediately succeeding such
                  Distribution Date (excluding any amount calculated in
                  accordance with paragraph 1(B)(a)); and

                                      26
<PAGE>

           (ii)   an amount equal to:

<TABLE>
<CAPTION>
                  <S>                                                               <C>
                  Group 2 Available Principal Receipts minus the aggregate          Outstanding Principal Balance on such
                  amount under (1)(B)(a) above in respect of the relevant     x       Group 2 Issuer's Intercompany Loan
                  Issuer on such Payment Date                                       -------------------------------------
                                                                                        Aggregate Outstanding Principal
                                                                                     Balance of all Intercompany Loans of
                                                                                                Group 2 Issuers
</TABLE>

PROVIDED THAT,

      (a)  subject as provided in paragraphs (2) through (8) below, for the
           purpose only of determining the amount of Issuer Allocable
           Principal Receipts which may be allocated and paid to the relevant
           Group 1 Issuer or Group 2 Issuer (but not to any other Issuer) in
           accordance with this paragraph (1), following an enforcement of the
           Issuer Security relating to that Issuer the amount so determined
           may be increased to the extent of the aggregate of any amounts
           standing to the credit of the Issuer Liquidity Reserve Ledger, if
           any, and the Issuer Reserve Ledger of that Issuer remaining on the
           relevant Payment Date after the application of such reserve funds
           in accordance with the Funding Pre-Enforcement Revenue Priority of
           Payments; and

      (b)  for the purposes only of determining the amount of Group 1 Shared
           Issuer Principal Receipts and Group 2 Shared Issuer Principal
           Receipts in accordance with paragraph (6) below, Issuer Allocable
           Principal Receipts (in respect of a Group 1 Issuer) shall be an
           amount equal to the amount calculated in accordance with paragraphs
           1(A)(a) and (1)(A)(b)(ii) and paragraph (1)(A)(b)(i) shall not
           apply and (in respect of a Group 2 Issuer) shall be an amount equal
           to the amount calculated in accordance with paragraphs (1)(B)(a)
           and (1)(B)(b)(ii) above paragraph (1)(B)(b)(i) above shall not
           apply.

(2)   If the Notes of any Issuer have become immediately due and payable as a
      result of the service of a Note Enforcement Notice or if the
      Intercompany Loan of any Issuer and the other Intercompany Loans of any
      other Issuers have become immediately due and payable as a result of the
      service of an Intercompany Loan Enforcement Notice or otherwise on any
      Payment Date following the occurrence of any Asset Trigger Event,
      principal payments in respect of any Intercompany Loan may be made in
      excess of any Controlled Amortisation Amount and paragraphs (1)(A)(a)
      and 1(A)(b)(i) (in respect of a Group 1 Issuer), or paragraphs (1)(B)(a)
      and 1(B)(b)(i) above (in respect of a Group 2 Issuer) shall no longer
      apply in relation to that Issuer and the amount of Issuer Allocable
      Principal Receipts payable to that Issuer on the relevant Payment Date
      may not exceed the amount determined under paragraphs

                                      27
<PAGE>

      (1)(A)(b)(ii) and (1)(B)(b)(ii) above (save that no deduction shall be
      made from Funding Available Principal Receipts) but subject always to
      any increase in that amount as a result of the utilisation of the Issuer
      Reserve Fund and the Issuer Liquidity Reserve Fund (if any) following
      enforcement of the Issuer Security relating to that Issuer as provided
      in that paragraph. Following the occurrence of any Non-Asset Trigger
      Event (but prior to the occurrence of an Asset Trigger Event), (1) the
      reference in paragraph (1)(A)(a)(ii) and (1)(B)(a)(ii) above to the
      "Controlled Amortization Amount due on such Money Market Note" shall be
      deemed to refer to the "Outstanding Principal Balance of such Money
      Market Note", and (2) paragraph (1)(A)(b)(i) above (in respect of a
      Group 1 Issuer), or paragraph (1)(B)(b)(i) above (in respect of a Group
      2 Issuer) shall no longer apply in relation to the relevant Issuer and
      the amount of Issuer Allocable Principal Receipts payable to that Issuer
      on the relevant Payment Date may not exceed the amount determined under
      paragraph (1)(A)(b)(ii) above (in respect of a Group 1 Issuer) and
      (1)(B)(b)(ii) above (in respect of a Group 2 Issuer, subject to the same
      qualifications set forth in the immediately preceding paragraph.

(3)   For the purpose of determining the amount of Issuer Allocable Principal
      Receipts and/or any Group 1 Shared Issuer Principal Receipts or Group 2
      Shared Issuer Principal Receipts which may be paid to any Issuer on a
      Payment Date pursuant to paragraph (1) above or paragraph (6) below, the
      Outstanding Principal Balance of the relevant Intercompany Loan shall be
      deemed to be reduced by the amount of:

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

      (B)  the Outstanding Principal Balance as at such Payment Date of any
           Special Repayment Notes issued by that Issuer.

(4)   The amount of Funding Available Principal Receipts payable to each
      Issuer on a Payment Date will be reduced by an amount equal to the
      aggregate of the Issuer Available Revenue Receipts of that Issuer which
      are to be applied on that Payment Date in reducing deficiencies recorded
      on the Issuer Principal Deficiency Ledgers, but only to the extent that
      the Issuer Available Revenue Receipts which are to be so applied on that
      Payment Date would not otherwise be payable as principal on the relevant
      Notes on such Payment Date.

                                      28
<PAGE>

(5)   No Issuer shall be entitled to, or shall receive on a Payment Date, any
      amount of Issuer Allocable Principal Receipts from Funding which is not
      required by that Issuer to make a payment on that date in accordance
      with the relevant Issuer Pre-Enforcement Principal Priority of Payments
      or otherwise to make a payment of principal on the Notes.

(6)   (A)  The portion of Issuer Allocable Principal Receipts (calculated in
           accordance with paragraph 1(A)(b)(ii) above), if any, not required
           to be applied by a Group 1 Issuer to pay principal on the Notes on
           a Payment Date for Group 1 Issuers together with the portion of
           Issuer Allocable Principal Receipts relating to all other Group 1
           Issuers not required to be so applied by such other Group 1 Issuers
           (or otherwise required to be set aside by Funding for any Group 1
           Issuer) on that Payment Date (excluding the amount of any Group 1
           Issuer Reserve Fund or Issuer Liquidity Reserve Fund (if any) of
           any Group 1 Issuer), shall constitute "Group 1 Shared Issuer
           Principal Receipts". Group 1 Shared Issuer Principal Receipts will
           be reallocated by the Cash Manager and distributed on such Payment
           Date among the Group 1 Issuers until there are no remaining amounts
           of Group 1 Shared Issuer Principal Receipts to be reallocated and
           distributed on such Payment Date. Save as provided in paragraph (2)
           above, if there is more than one Group 1 Issuer that is entitled to
           Group 1 Shared Issuer Principal Receipts, then each such Issuer
           will be reallocated a portion of the Group 1 Shared Issuer
           Principal Receipts equal to:

<TABLE>
<CAPTION>
      <S>                                                    <C>
                                                             Outstanding Principal Balance of
                                                             the Intercompany Loan of such Group 1 Issuer
      amount of Shared Group 1 Issuer Principal Receipts  x  --------------------------------------------
                                                             Aggregate Outstanding Principal Balance of
                                                             the Intercompany Loan of all Group 1 Issuers
</TABLE>

(B)   The portion of Issuer Allocable Principal Receipts (calculated in
      accordance with paragraph (1)(B)(b)(ii) above), if any, not required to
      be applied by a Group 2 Issuer to pay principal of the Notes on a
      Payment Date for Group 2 Issuers together with the portion of Issuer
      Allocable Principal Receipts relating to all other Group 2 Issuers not
      required to be so applied by such other Group 2 Issuers (or otherwise
      required to be set aside by Funding for any Group 2 Issuer) on that
      Payment Date (excluding the amount of any Issuer Reserve Fund or Issuer
      Liquidity Reserve Fund (if any) of any Group 2 Issuer) shall constitute
      "Group 2 Shared Issuer Principal Receipts". Group 2 Shared Issuer
      Principal Receipts will be reallocated by the Cash Manager and
      distributed on such Payment Date among the Group 2 Issuers until there
      are no remaining amounts of Group 2 Shared Issuer Principal Receipts to
      be reallocated and distributed on such Payment Date. Save as provided in
      paragraph (2) above, if there is more than one Group 2 Issuer that is
      entitled to Group 2 Shared Issuer Principal Receipts, then each such
      Group 2 Issuer will

                                      29
<PAGE>

      be reallocated a portion of the Group 2 Shared Issuer Principal Receipts
      equal to:

<TABLE>
<CAPTION>
      <S>                                                     <C>
                                                             Outstanding Principal Balance of
                                                             the Intercompany Loan of such Group 2 Issuer
      Amount of Shared Group 2 Issuer Principal Receipts  x  --------------------------------------------
                                                             Aggregate Outstanding Principal Balance of
                                                             the Intercompany Loan of all Group 2 Issuers
</TABLE>

(7)   The repayment of any Intercompany Loan prior to the occurrence of a
      Trigger Event, enforcement of the Issuer Security by the Note Trustee
      under the relevant Issuer Deed of Charge or enforcement of the Funding
      Security by the Security Trustee under the Funding Deed of Charge will
      be made in accordance with the terms of the relevant Intercompany Loan
      Agreement.

(8)   The Cash Manager will distribute only Group 1 Available Principal
      Receipts on each Payment Date for Group 1 Issuers and only Group 2
      Available Principal Receipts on each Payment Date for Group 2 Issuers.
      No payment may be made to Group 1 Issuers from Group 2 Available
      Principal Receipts and no payment may be made to Group 2 Issuers from
      Group 2 Available Principal Receipts.

                                      30
<PAGE>

                                   Part III

                 Funding Post-Enforcement Priority of Payments

At any time after the security created under the Funding Deed of Charge has
become enforceable in accordance with Clause 7.2 (Enforceable) thereof and
provided that the Intercompany Loan Enforcement Notice has not been withdrawn,
all Funding Available Revenue Receipts, Funding Available Principal Receipts
and all other monies paid to or received or recovered by or on behalf of
Funding or the Security Trustee or any Receiver appointed on its behalf,
including all proceeds following any sale, realisation or enforcement of the
security created under the Funding Deed of Charge and all amounts not
previously distributed and/or standing to the credit of any Funding Bank
Account and all monies standing to the credit of the Funding Reserve Ledger
(if any) shall (if not already received by the Security Trustee) be paid to
and held by the Security Trustee on trust to apply the same (save to the
extent required otherwise by applicable law) in accordance with the rules and
the order of priority of the Funding Post-Enforcement Priority of Payments.

The Security Trustee (or the Cash Manager on its behalf) will, subject to the
rules for application of Funding Available Principal Receipts and Funding
Available Revenue Receipts set out in Part I and Part II of this Schedule,
apply all such amounts received or recovered following enforcement of the
Funding Security on each Payment Date in accordance with the following order
of priority (the "Funding Post-Enforcement Priority of Payments"):

      (A)  first, from amounts standing to the credit of the Funding Expense
           Sub-Ledger in respect of such Payment Date, to pay amounts due to
           the Security Trustee and any Receiver appointed by the Security
           Trustee, together with interest and (to the extent not already
           inclusive) VAT on those amounts, and to provide for any amounts due
           or to become due to the Security Trustee and the Receiver in the
           following Interest Period under the Funding Deed of Charge or any
           other Transaction Document;

      (B)  second, from amounts standing to the credit of the Funding Expense
           Sub-Ledger in respect of such Payment Date, towards payment of
           amounts due and payable to the Cash Manager and any costs, charges,
           liabilities and expenses then due or to become due and payable to
           the Cash Manager under the Cash Management Agreement, together with
           (to the extent not already inclusive) VAT on those amounts;

      (C)  third, from amounts standing to the credit of the Funding Expense
           Sub-Ledger in respect of such Payment Date, (in no order of
           priority among them but in proportion to the respective amounts
           due) towards payment of amounts (if any) due to the Account Bank
           under the terms of the Bank Account

                                      31
<PAGE>

           Agreement and to the Corporate Services Provider under the
           Corporate Services Agreement;

      (D)  fourth, (1) from Group 1 Available Revenue Receipts and Group 1
           Available Principal Receipts in respect of each Payment Date for
           Group 1 Issuers, (in no order of priority among them but in
           proportion to the respective amounts due) to each Group 1 Issuer
           its share of Issuer Allocable Revenue Receipts and Issuer Allocable
           Principal Receipts towards payment of amounts of interest,
           principal and fees due to such Group 1 Issuer under such Issuer's
           Intercompany Loan Agreement, which in the case of that Issuer shall
           be up to the aggregate amount of the amounts, and shall be applied
           in the amounts and priorities, as set forth in the Issuer
           Post-Enforcement Priority of Payments for that Issuer;

      (2)  from Group 2 Available Revenue Receipts and Group 2 Available
           Principal Receipts in respect of each Payment Date for Group 2
           Issuers (in no order of priority among them but in proportion to
           the respective amounts due) to each Group 2 Issuer its Issuer
           Allocable Revenue Receipts and Issuer Allocable Principal Receipts,
           respectively, towards payment of amounts of interest, principal and
           fees due to such Group 2 Issuer under such Issuer's Intercompany
           Loan Agreement, which in the case of that Group 2 Issuer shall be
           up to the aggregate of the amounts, and shall be applied in the
           amounts and priorities, as set forth in the Issuer Post-Enforcement
           Priority of Payments for that Issuer;

      (E)  fifth, (1) from Group 1 Available Revenue Receipts and Group 1
           Available Principal Receipts in respect of each Payment Date for
           Group 1 Issuers, towards payment of amounts due to each Issuer
           Start-Up Loan Provider under the relevant Issuer Start-up Loan
           Agreement for each Group 1 Issuer;

           (2) from Group 2 Available Revenue Receipts and Group 2 Available
           Principal Receipts in respect of each Payment Date for Group 2
           Issuers, towards the payment of amounts due to each Issuer Start-up
           Loan Provider under the relevant Issuer Start-up Loan Agreement for
           each Group 2 Issuer;

      (F)  sixth, from any remaining Funding Available Revenue Receipts (being
           the remaining Group 1 Available Revenue Receipts, the Group 1
           Available Principal Receipts, the Group 2 Available Revenue
           Receipts and the Group 2 Available Principal Receipts) in respect
           of such Payment Date, towards payment of any Deferred Contribution
           due to the Mortgages Trustee under the Mortgages Trust Deed; and

      (G)  last, to pay any amount remaining following the application of
           principal and revenue set forth in paragraphs (A) through (F)
           above, to Funding,

                                      32
<PAGE>

PROVIDED THAT, to the extent that there is a shortfall in the amounts standing
to the credit of the Funding Expense Sub-Ledger, amounts payable under (A)
through (C) above may also be paid from Group 1 Available Revenue Receipts or
Group 2 Available Revenue Receipts as applicable to the relevant Payment Date.

                                      33Exhibit 4.5.3

                             Dated 28 January 2004
                             ---------------------

                        GRANITE FINANCE FUNDING LIMITED
                                  as Funding

                       GRANITE FINANCE TRUSTEES LIMITED
                             as Mortgages Trustee

                                      and

                             THE BANK OF NEW YORK
                              as Security Trustee

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

                    SECOND PRIORITY FUNDING DEED OF CHARGE

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

                          SIDLEY AUSTIN BROWN & WOOD

                             1 THREADNEEDLE STREET
                                LONDON EC2R 8AW
                            TELEPHONE 020 7360 3600
                            FACSIMILE 020 7626 7937
                             REF: 30507-21/639486

<PAGE>
<TABLE>
<CAPTION>

                                   CONTENTS

Clause                                                                                                   Page No.
<S>      <C>                                                                                                <C>
1.       Interpretation......................................................................................1

2.       Covenant to Pay and to Perform......................................................................2

3.       Funding Security....................................................................................2

4.       Release of Funding Charged Property.................................................................5

5.       Declaration of Trust................................................................................5

6.       Enforcement.........................................................................................5

7.       Upon Enforcement....................................................................................8

8.       Receiver............................................................................................9

9.       Further Assurance and Power of Attorney............................................................12

10.      Crystallisation....................................................................................13

11.      Provisions relating to the Security................................................................13

12.      Protection of Third Parties........................................................................15

13.      Set-Off............................................................................................15

14.      Representations and Covenants:.....................................................................16

15.      Terms of Appointment...............................................................................17

16.      Remuneration of the Security Trustee...............................................................27

17.      Appointment, Removal and Retirement of Security Trustee............................................30

18.      Miscellaneous Provisions...........................................................................32

19.      Rights cumulative..................................................................................32

20.      Corporate Obligations..............................................................................32

21.      Notices............................................................................................33

22.      Third Party Rights.................................................................................34

23.      Execution in Counterparts; Execution and Effectiveness; Severability...............................34

24.      Governing Law and Submission to Jurisdiction.......................................................34

SCHEDULE 1  FORM OF SECURITY POWER OF ATTORNEY..............................................................37

</TABLE>

<PAGE>

THIS DEED OF CHARGE is made on 28 January 2004

BETWEEN:

(1)      GRANITE FINANCE FUNDING LIMITED (registered number 79308) a private
         limited liability company incorporated under the laws of Jersey whose
         London Branch is at 4 Royal Mint Court, London EC3N 4HJ ("Funding");

(2)      THE BANK OF NEW YORK, a New York banking corporation whose London
         branch address is at One Canada Square, 48th Floor, London E14 5AL,
         United Kingdom, as security trustee (the "Security Trustee" which
         expression shall include such person and all other persons for the
         time being acting as the security trustee or security trustees
         pursuant to this Second Priority Funding Deed of Charge); and

(3)      GRANITE FINANCE TRUSTEES LIMITED (registered number 79309) a private
         limited liability company incorporated under the laws of Jersey whose
         registered office is at 22 Grenville Street, St. Helier, Jersey JE4
         8PX Channel Islands as trustee of the Mortgages Trust (the "Mortgages
         Trustee").

WHEREAS:

(A)      Funding has created first ranking fixed and floating security in
         favour of the Security Trustee for the benefit of each of the Funding
         Secured Creditors in respect of Funding's obligations under the
         Funding Transaction Documents upon and subject to the terms of the
         First Priority Funding Deed of Charge. The Security Trustee holds
         such security on trust for the benefit of the Funding Secured
         Creditors.

(B)      Funding has agreed to create the security described in this Second
         Priority Funding Deed of Charge which deed is supplemental to the
         First Priority Funding Deed of Charge. Such security, which the
         Security Trustee shall hold on trust for the benefit of the Funding
         Secured Creditors, will rank subsequent to the existing security
         created under the First Priority Funding Deed of Charge.

NOW THIS DEED WITNESSES AS FOLLOWS:

1.       Interpretation

1.1      Definitions: The provisions of the Master Definitions Schedule as
         amended and restated by (and appearing in Appendix 1 to) the Master
         Definitions Schedule Seventh Amendment Deed made on 26 January 2004
         between, among others, Funding, the Mortgages Trustee and the
         Security Trustee (as the same has been and may be amended, varied or
         supplemented from time to time with the consent of the parties
         hereto) are expressly and specifically incorporated into and shall
         apply to this Agreement.

1.2      Construction:  In this Deed, except where the context otherwise
         requires:

         (a)      This Deed is supplemental to the existing Funding Deed of
                  Charge entered into on 26 March 2001 between the Security
                  Trustee, Funding and the Funding Secured

                                      1
<PAGE>

                  Creditors (the "First Priority Funding Deed of Charge") and
                  is in addition to and does not supersede the terms and effect
                  of the First Priority Funding Deed of Charge (including, for
                  the avoidance of doubt, all Deeds of Accession).

         (b)      the terms of the Master Definitions Schedule and of any
                  agreement in existence at the date hereof between the
                  parties hereto in relation to any such documents are
                  incorporated in this Deed to the extent required to ensure
                  that any proposed disposition of the Funding Charged
                  Property contained in this Deed is a valid disposition in
                  accordance with Section 2(1) of the Law of Property
                  (Miscellaneous Provisions) Act 1989;

         (c)      a reference in this Deed to any property, assets,
                  undertakings or rights includes, unless the context
                  otherwise requires, present and future property, assets,
                  undertakings or rights;

         (d)      "this Second Priority Funding Deed of Charge" or "this Deed"
                  means this Deed of Charge and the Schedule hereto (as the
                  same may be amended, varied or supplemented from time to
                  time with the consent of the parties hereto) and each other
                  document or deed entered into pursuant hereto (as the same
                  may be amended, varied or supplemented from time to time
                  with the consent of the parties hereto) and expressed to be
                  supplemental hereto.

2.       Covenant to Pay and to Perform

         Subject to the provisions of the Funding Transaction Documents,
         including, without limitation, any limited recourse provisions,
         Funding covenants with and undertakes to the Security Trustee for
         itself and as trustee for the Funding Secured Creditors that it will:

         (a)      duly and punctually pay and discharge all monies and
                  liabilities whatsoever which now are or at any time
                  hereafter may (whether before or after demand) become due
                  and payable by Funding to the Security Trustee (whether for
                  its own account or as trustee for the Funding Secured
                  Creditors) or to any of the other Funding Secured Creditors,
                  whether actually or contingently, under this Deed or any
                  other of the Funding Transaction Documents; and

         (b)      observe, perform and satisfy all its other obligations and
                  liabilities under this Deed and/or any of the Funding
                  Transaction Documents,

         PROVIDED THAT every payment in respect of any Funding Transaction
         Document made to the relevant Funding Secured Creditor in the manner
         provided in such Funding Transaction Document shall operate in
         satisfaction pro tanto of the relevant covenant and undertaking by
         Funding in this Clause.

3.       Funding Security

3.1      Trust Property:

                                      2
<PAGE>

         (a)      Funding, by way of a fixed charge for the payment or
                  discharge of the Funding Secured Obligations, subject to
                  Clause 4 (Release of Funding Charged Property), hereby
                  charges to the Security Trustee, all of its right, title,
                  benefit and interest, present and future, in, to and under
                  the Funding Share of the Trust Property (including, without
                  limitation, all Scottish Trust Property, present and future,
                  comprised in the Trust Property) and including all rights to
                  receive payment of any amounts which may become payable to
                  Funding thereunder and all payments received by Funding
                  thereunder including, without limitation, all rights to
                  serve notices and/or make demands thereunder and/or to take
                  such steps as are required to cause payments to become due
                  and payable thereunder and all rights of action in respect
                  of any breach thereof and all rights to receive damages or
                  obtain relief in respect thereof and the proceeds of any of
                  the foregoing, TO HOLD the same unto the Security Trustee
                  absolutely.

         (b)      The fixed charge created under or pursuant to Clause 3.1(a)
                  above ranks subsequent to the first fixed charge created
                  under or pursuant to Clause 3.1 (Trust Property) of the
                  First Priority Funding Deed of Charge.

3.2      Floating Charge:

         (a)      Funding, by way of floating security for the payment or
                  discharge of the Funding Secured Obligations, subject to
                  Clause 4 (Release of Funding Charged Property), hereby
                  charges by way of a floating charge in favour of the
                  Security Trustee the whole of its undertaking and all its
                  property, assets and rights, whatsoever and wheresoever,
                  both present and future (including the whole undertaking,
                  property, assets and rights of Funding situated in Scotland
                  or governed by the law of Scotland).

         (b)      The floating charge created under or pursuant to Clause
                  3.2(a) above ranks subsequent to the first floating charge
                  created under or pursuant to Clause 3.5 (Floating Charge) of
                  the First Priority Funding Deed of Charge.

         (c)      Paragraph 14 of Schedule B1 to the Insolvency Act 1986, as
                  amended, applies to the floating charge created hereunder.

3.3      Title Guarantee: Each of the dispositions of or charges over property
         effected in or pursuant to this Second Priority Funding Deed of
         Charge is made with full title guarantee (or, in relation to assets
         or rights situated in Scotland or governed by the law of Scotland,
         with absolute warrandice).

3.4      Further Acquired Items: For the avoidance of doubt, it is hereby
         confirmed that the Security Interests created under or pursuant to
         Clause 3.1 (Trust Property) are intended to be specific and fixed
         charges over (as the case may be) the property and assets to which
         they relate, both present and future, including property and assets
         which are acquired after the date hereof.

3.5      No Transfer of Obligations: Notwithstanding anything else in this
         Second Priority Funding Deed of Charge, it is hereby agreed that
         dispositions of property effected in or pursuant to this

                                      3
<PAGE>

         Second Priority Funding Deed of Charge do not transfer obligations,
         and nothing herein shall be construed as a transfer of obligations, to
         the Security Trustee.

3.6      Notice and Acknowledgement: Funding hereby intimates and gives notice
         to the Mortgages Trustee as trustee under and in terms of the
         Mortgages Trust Deed of the assignation in security made in terms of
         Clause 3.1 (Trust Property) and the Mortgages Trustee by its
         execution of this Deed as such trustee immediately subsequent to the
         execution hereof by Funding confirms that as at the date hereof it
         has received no intimation of any other dealing with the Funding
         Share of the Trust Property or any part thereof except in accordance
         with the terms of the Funding Transaction Documents.

3.7      Security Trustee's Discretion in relation to Funding Charged
         Property: Without prejudice to any other rights of the Security
         Trustee after the security created under this Deed has become
         enforceable and subject to the terms of the Funding Transaction
         Documents, the Security Trustee may at any time after any part or
         parts of the Funding Security have become enforceable:

         (a)      enter into, make, execute, sign, deliver and do all such
                  contracts, agreements, deeds, receipts, payments,
                  assignments, transfers, conveyances, assurances and things
                  and bring, prosecute, enforce, defend and abandon all such
                  actions, suits and proceedings in relation to the Funding
                  Charged Property as it may think expedient;

         (b)      exercise or refrain from exercising, in such manner as in
                  its absolute discretion the Security Trustee shall think
                  fit, all or any of the rights, powers, authorities
                  discretions or remedies of Funding under or in relation to
                  the Funding Charged Property or incidental to the ownership
                  thereof and, in particular but without limiting the
                  generality of the foregoing, exercise all rights to vote or
                  to give any consent or notification or make any declaration
                  in relation to such Funding Charged Property. For the
                  avoidance of doubt, the Security Trustee shall not be
                  required to have regard to the interests of Funding in the
                  exercise or non-exercise of any such rights, powers,
                  authorities, discretions and remedies or to comply with any
                  direction given by Funding in relation thereto; and

         (c)      demand, sue for and take any advice or institute any
                  proceedings to recover or obtain payment of any amounts
                  which may then be due and payable to Funding but which
                  remains unpaid under or in respect of the Funding Charged
                  Property or any part thereof either in its own name or in
                  the name of Funding.

3.8      Security Trustee Consent: In the event that the creation of the
         Security Interests under or pursuant to this Deed would, in the
         absence of written consent by the Security Trustee, constitute a
         breach of any representation, warranty, covenant or undertaking in
         any Funding Transaction Document, the Security Trustee hereby
         consents to the creation of such Security Interests.

                                      4
<PAGE>

4.       Release of Funding Charged Property

4.1      Release, Reassignment or Discharge: Upon the irrevocable and
         unconditional payment in full or discharge (or any combination of the
         foregoing) of all the Funding Secured Obligations and upon the
         Security Trustee being satisfied that Funding is under no further
         actual or contingent obligation under this Deed or any other Funding
         Transaction Document, the Security Trustee shall at the request and
         cost of Funding release, reassign and/or discharge from the Security
         Interests all the relevant Funding Charged Property to, or to the
         order of, Funding; provided that where any such release,
         re-assignment or discharge is made in whole or in part on the faith
         of any payment, security or other disposition which is avoided or
         which must be repaid on bankruptcy, liquidation or otherwise, the
         security constituted by or pursuant to this Second Priority Funding
         Deed of Charge and the liability of Funding hereunder and thereunder
         shall continue as if there had been no such release, re-assignment or
         discharge.

4.2      Trust Property: On the repurchase by the Seller from the Mortgages
         Trustee of any Mortgage Loan together with its Related Security
         pursuant to and in accordance with the terms of the Mortgage Sale
         Agreement, such Mortgage Loan and its Related Security shall no
         longer form part of the Trust Property (or in the case of any
         Scottish Mortgage Loan and its Related Security, the Scottish Trust
         Property, in accordance with Clause 9 (Termination of Trust) of the
         relevant Scottish Trust Deed) and shall automatically be released
         from any Security Interest created under or pursuant to this Deed in
         respect of the Funding Share of the Trust Property.

5.       Declaration of Trust

         The Security Trustee hereby declares that it holds on trust for the
         Funding Secured Creditors (or, as the case may be, the relevant
         Funding Secured Creditor), upon and subject to the terms and
         conditions of this Second Priority Funding Deed of Charge and the
         First Priority Funding Deed of Charge, all of the covenants,
         undertakings and representations made to the Security Trustee under
         this Second Priority Funding Deed of Charge or any other Funding
         Transaction Document and all of the Security Interests made or given
         to the Security Trustee or to be made or given to it for the purpose
         of securing the Funding Secured Obligations.

6.       Enforcement

6.1      Notification: The Security Trustee shall, if reasonably practicable,
         give prior notification to the Seller, and the Cash Manager and each
         Funding Secured Creditor of the Security Trustee's intention to
         enforce the security created by this Second Priority Funding Deed of
         Charge. However, the failure of the Security Trustee to provide such
         notification shall not in any way prejudice the ability of the
         Security Trustee to enforce the security created by this Second
         Priority Funding Deed of Charge.

6.2      Enforceable:

         (a)      Without prejudice to the provisions of Clause 8 (Receiver)
                  the security created under or pursuant to this Second
                  Priority Funding Deed of Charge shall become immediately
                  enforceable and the power of sale and other powers conferred
                  by

                                      5
<PAGE>

                  Section 101 of the 1925 Act, as varied or amended by this
                  Second Priority Funding Deed of Charge, shall be exercisable
                  by the Security Trustee, in each case at any time:

                  (i)      upon the service on Funding by the Security Trustee
                           of an Intercompany Loan Enforcement Notice; or

                  (ii)     if there are no Intercompany Loans outstanding,
                           following a default in payment of any other Funding
                           Secured Obligation on its due date or within any
                           applicable grace period following such due date
                           stated in the relevant Funding Transaction Document
                           but subject always to Clause 6.7 (No Enforcement by
                           Funding Secured Creditors and Limited Recourse) of
                           the First Priority Funding Deed of Charge.

6.3      Power of Sale:

         (a)      Notwithstanding any other provision of this Second Priority
                  Funding Deed of Charge, the Funding Secured Obligations
                  shall be deemed to have become due and payable for the
                  purposes of Section 101 of the 1925 Act and (to the extent
                  applicable) the statutory power of sale and of appointing a
                  receiver and other powers which are conferred on mortgagees
                  under the 1925 Act as varied or extended by this Second
                  Priority Funding Deed of Charge shall be deemed to arise
                  immediately after execution of this Deed.

         (b)      Section 103 of the 1925 Act shall not apply to this Deed and
                  forthwith after the security has become enforceable in
                  accordance with Clause 6.2 (Enforceable) the statutory power
                  of sale, as extended by this Second Priority Funding Deed of
                  Charge, and all other powers shall become immediately
                  exercisable without notice to Funding and the provisions of
                  the 1925 Act regulating the power of sale shall, so far as
                  they relate to the Funding Charged Property, be varied and
                  extended accordingly.

6.4      Discretionary Enforcement: Subject to the provisions of this Second
         Priority Funding Deed of Charge, at any time after the security has
         become enforceable in accordance with Clause 6.2 (Enforceable), the
         Security Trustee may, at its discretion and without notice, take such
         steps as it may think fit to enforce the security created pursuant to
         this Second Priority Funding Deed of Charge.

6.5      Law of Property Act 1925: The provisions of the 1925 Act relating to
         the power of sale and the other powers conferred by Section 101(1)
         and (2) are hereby extended in relation to Funding as if such
         extensions were contained in the 1925 Act such that at any time after
         the security constituted by this Second Priority Funding Deed of
         Charge has become enforceable in accordance with Clause 6.2
         (Enforceable) above, the Security Trustee may in its absolute
         discretion:

         (a)      make demand in the name of the Funding Secured Creditors or
                  in its own right for any monies and liabilities in respect
                  of the Funding Charged Property;

                                      6
<PAGE>

         (b)      enforce any rights it may have in respect of the whole or
                  any part of the Funding Charged Property in such manner and
                  upon such terms as the Security Trustee shall think fit;

         (c)      take possession of, get in and collect the Funding Charged
                  Property and perfect the interests comprised therein;

         (d)      subject as expressly provided in Clause 6.6 (Restriction on
                  Disposal of Funding Charged Property), sell, transfer,
                  convey, dispose of vary or otherwise deal with, and also to
                  grant any option to purchase, and to effect exchanges of,
                  the whole or any part of the Funding Charged Property or any
                  interest therein in such manner, for such consideration (if
                  any) and generally upon such terms (including by deferred
                  payment or payment by instalments) as it may think fit
                  and/or to concur in any of the foregoing (and nothing shall
                  preclude any such disposal being made to a Funding Secured
                  Creditor);

         (e)      carry out any transaction, scheme or arrangement which the
                  Security Trustee may, in its absolute discretion, consider
                  appropriate with a view to or in connection with the sale of
                  the Funding Charged Property;

         (f)      do all or any of the things or exercise all or any of the
                  powers, authorities and discretions conferred expressly or
                  by implication on any Receiver under Clause 8.6 (Powers of
                  the Receiver) or otherwise under this Second Priority
                  Funding Deed of Charge; and

         (g)      exercise all or any of the powers conferred on mortgagees by
                  the 1925 Act as varied or extended by this Second Priority
                  Funding Deed of Charge and any other rights and remedies
                  that may be conferred by statute or common law or in equity
                  on mortgagees or receivers.

6.6      Restriction on Disposal of Funding Charged Property: Notwithstanding
         the foregoing provisions of this Clause 6 (Enforcement), if the
         Funding Security has become enforceable otherwise than by reason of a
         default in payment of any amount due in respect of any Intercompany
         Loan which would be utilised to fund the payment of any amount due on
         the Class A Notes of any Issuer, the Security Trustee will not be
         entitled to dispose of all or part of the Funding Charged Property
         unless either:

         (a)      a sufficient amount would be realised to allow a full and
                  immediate discharge of such amount under each Intercompany
                  Loan as would be sufficient to fund the payment in full of
                  all amounts owing in respect of the Class A Notes of each
                  Issuer and all prior ranking amounts due by Funding in
                  accordance with the relevant Funding Priority of Payments;
                  or

         (b)      the Security Trustee is of the opinion, which shall be
                  binding on the Funding Secured Creditors, reached after
                  considering at any time and from time to time the advice of
                  any financial or such other professional advisers selected
                  by the Security Trustee for the purpose of giving such
                  advice that the cashflow prospectively receivable by

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<PAGE>

                  Funding  will not, or that there is a significant risk that
                  it will not, be sufficient, having regard to any other
                  relevant actual, contingent or prospective liabilities of
                  Funding, to discharge in full in due course such amount under
                  each Intercompany Loan as would be sufficient to fund the
                  payment in full of all amounts owing in respect of the Class
                  A Notes of each Issuer and all prior ranking amounts due by
                  Funding. The fees and expenses of the aforementioned financial
                  adviser or such other professional adviser selected by the
                  Security Trustee shall be paid by Funding; and

         (c)      the Security Trustee shall not be bound to make the
                  determination set out above unless it shall have been
                  indemnified and/or secured to its satisfaction against all
                  liabilities to which it may thereby become liable or which
                  it may incur by so doing,

         PROVIDED THAT if the Security Trustee is unable to obtain the advice
         referred to in paragraph (b) above having made reasonable efforts to
         do so, this Clause 6.6 (Restriction on Disposal of Funding Charged
         Property) shall not apply.

6.7      Authorised Investments: Any monies which under the trusts of this
         Second Priority Funding Deed of Charge ought to or may be invested by
         the Security Trustee (or the Cash Manager on its behalf) after the
         security has become enforceable in accordance with Clause 6.2
         (Enforceable) may be invested in the name or under the control of the
         Security Trustee in any Authorised Investments and the Security
         Trustee may at any time vary or transfer (or direct the Cash Manager
         to vary or transfer) any of such Authorised Investments for or into
         other such Authorised Investments as the Security Trustee in its
         absolute discretion may determine, and shall not be responsible (save
         where any loss results from the Security Trustee's fraud, wilful
         default or gross negligence or that of its officers or employees) for
         any loss occasioned by reason of any such investments whether by
         depreciation in value or otherwise, provided that such Authorised
         Investments were made in accordance with the foregoing provisions.

7.       Upon Enforcement

7.1      Upon Service of Intercompany Loan Enforcement Notice: From and
         including the date when the Security Trustee serves an Intercompany
         Loan Enforcement Notice (which has not been withdrawn) on Funding
         (provided that the Mortgages Trustee and the Cash Manager have been
         notified of the service of an Intercompany Loan Enforcement Notice)
         no action whatsoever may be taken by the Mortgages Trustee in
         relation to or in respect of the Funding Charged Property without the
         prior written consent of the Security Trustee save for any action
         required to preserve or protect the Mortgages Trustee's right, title
         or interest therein.

7.2      Application: Prior to and following enforcement of the Funding
         Security all amounts at any time held by Funding, the Cash Manager or
         the Security Trustee in respect of the security created under this
         Deed shall be held and/or applied by such person subject to and in
         accordance with the relevant provisions of the First Priority Funding
         Deed of Charge.

7.3      Scottish Trust Property: Without prejudice to the foregoing
         provisions of this Clause 7 (Upon Enforcement), Funding and the
         Mortgages Trustee hereby covenant and agree with and undertake to the
         Security Trustee that if at any time after the security constituted
         under this Deed shall have become enforceable the Security Trustee or
         any Receiver shall so require,

                                      8
<PAGE>

         they will join together in directing the Seller to sell or dispose
         of all or any part of the Scottish Trust Property on terms previously
         approved by the Security Trustee and/or in causing the trusts
         constituted by all and any Scottish Trust Deeds to be wound up or
         performed and they will take all such actions and execute all such
         documents as may be necessary to effect such sale or disposal or
         winding up or performance and the distribution or transfer of the
         Scottish Trust Property or any part thereof in accordance with the
         terms of each Scottish Trust Deed, the Mortgages Trust Deed and this
         Second Priority Funding Deed of Charge. The Seller and the Mortgages
         Trustee hereby acknowledge and consent to the foregoing as trustee and
         beneficiary respectively in terms of each Scottish Trust Deed.

8.       Receiver

8.1      Appointment: At any time after the security constituted hereunder
         becomes enforceable, and whether or not the Security Trustee has
         taken possession of the Funding Charged Property, the Security
         Trustee may appoint, by writing or by deed, such person or persons
         (including an officer or officers of the Security Trustee) as the
         Security Trustee thinks fit to be a receiver, a receiver and manager
         or an administrative receiver of the Funding Charged Property or any
         part thereof (each a "Receiver") and, in the case of an appointment
         of more than one person, to act together or independently of the
         other or others.

8.2      Removal and Replacement: Except as otherwise required by statute, the
         Security Trustee may by writing or by deed remove a Receiver and
         appoint another in its place or to act with a Receiver and the
         Security Trustee may apply to the court for an order removing an
         administrative receiver.

8.3      Extension of Appointment: The exclusion of any part of the Funding
         Charged Property from the appointment of the Receiver shall not
         preclude the Security Trustee from subsequently extending its
         appointment (or that of the Receiver replacing it) to that part of
         the Funding Charged Property or appointing another Receiver over any
         other part of the Funding Charged Property.

8.4      Agent of Funding: The Receiver shall, so far as the law permits, be
         the agent of Funding and Funding alone shall be responsible for the
         Receiver's contracts, engagements, acts, omissions, misconduct,
         negligence or default and for liabilities incurred by it; and in no
         circumstances whatsoever shall the Security Trustee or any Funding
         Secured Creditor be in any way responsible for or incur any liability
         in connection with its contracts, engagements, acts, omissions,
         misconduct, negligence or default, and if a liquidator of Funding
         shall be appointed, the Receiver shall act as principal and not as
         agent for the Security Trustee. Notwithstanding the generality of the
         foregoing, such Receiver shall in the exercise of its powers,
         authorities and discretions conform to the regulations (if any) from
         time to time made and given by the Security Trustee.

8.5      Remuneration: Subject as provided otherwise by applicable law, the
         remuneration of the Receiver shall be fixed by the Security Trustee
         and may be or include a commission calculated by reference to the
         gross amount of all monies received or otherwise. Such remuneration
         and such commission) (if any) shall be payable hereunder by Funding
         alone subject always to Clause 8.3 (Funding Post-Enforcement Priority
         of Payments) of the First

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<PAGE>

         Priority Funding Deed of Charge and the amount of such remuneration
         shall form part of the Funding Secured Obligations and shall
         accordingly be secured on the Funding Charged Property under the
         security created by or pursuant to this Second Priority Funding Deed
         of Charge.

8.6      Powers of the Receiver: The Receiver of Funding, in addition to any
         powers conferred on an administrative receiver, receiver, manager or
         receiver and manager by statute or common law, shall have the power
         to:

         (a)      take possession of, get in and collect the Funding Charged
                  Property;

         (b)      subject as expressly provided in Clause 6.6 (Restriction on
                  Disposal of Funding Charged Property), sell, transfer,
                  convey, license, release or otherwise dispose of vary or
                  deal with, and also to grant any option to purchase, and to
                  effect exchanges of, the whole or any part of Funding
                  Charged Property or any interest therein and to grant or
                  accept surrenders, disclaimers and variations in relation to
                  or otherwise affecting the Funding Charged Property in each
                  case in such manner, for such consideration (if any) and
                  generally upon such terms (including by deferred payment or
                  payment by instalments) as it may think fit and/or to concur
                  in any of the foregoing (and nothing shall preclude any such
                  disposal being made to a Funding Secured Creditor);

         (c)      carry out any transaction, scheme or arrangement which the
                  Security Trustee may, in its absolute discretion, consider
                  appropriate with a view to or in connection with the sale of
                  the Funding Charged Property;

         (d)      insure the Funding Charged Property against such risks and
                  for such amounts as the Security Trustee may consider
                  prudent and to obtain bonds and performance guarantees;

         (e)      otherwise protect, maintain or improve, the Funding Charged
                  Property or any part thereof in any manner and for any
                  purpose whatsoever as it shall think fit;

         (f)      transfer all or any of the Funding Charged Property and/or
                  any of the liabilities to any other company or body
                  corporate, whether or not formed or acquired for the purpose
                  (and whether or not a subsidiary or associated company of
                  the Security Trustee or any other party to the Funding
                  Transaction Documents) and to form a subsidiary or
                  subsidiaries of Funding;

         (g)      carry on and manage or concur in managing or appoint a
                  manager of, the whole or any part of the business of Funding
                  in such manner as it shall in its absolute discretion think
                  fit including the power to enter into any contract and to
                  perform, repudiate, rescind or vary any contract to which
                  Funding is a party;

         (h)      sell or concur in selling the whole or any part of Funding's
                  business whether as a going concern or otherwise;

                                      10
<PAGE>

         (i)      appoint, dismiss, engage or vary the terms of employment of
                  any employees, managers, agents or advisers of Funding upon
                  such terms as to remuneration and otherwise for such periods
                  as it may in its absolute discretion think fit;

         (j)      in connection with the exercise or proposed exercise of any
                  of its powers or in order to obtain payment of its
                  remuneration or reimbursement of its expenses (in each case,
                  whether or not already due), to borrow or raise money from
                  any person, without security or on the security of the
                  Funding Charged Property (either in priority to the security
                  constituted by this Second Priority Funding Deed of Charge
                  or otherwise) and generally in such manner and on such terms
                  as it may think fit;

         (k)      bring, defend, submit to arbitration, negotiate, compromise,
                  enforce, abandon and settle actions, suits, claims and
                  proceedings concerning or affecting the Funding Charged
                  Property or the security created under or pursuant to this
                  Second Priority Funding Deed of Charge;

         (l)      exercise any powers, discretions, voting, conversion or
                  other rights or entitlements in relation to any of the
                  Funding Charged Property or incidental to the ownership of
                  or rights in or to any of the Funding Charged Property and
                  to complete or effect any transaction entered into by
                  Funding or disclaim, abandon or modify all or any of the
                  outstanding contracts or arrangements of Funding relating to
                  or affecting the Funding Charged Property;

         (m)      generally carry out, or cause to be carried out any
                  transaction or scheme or arrangement whatsoever, whether
                  similar or not to any of the foregoing, in relation to the
                  Funding Charged Property which it may consider expedient as
                  effectual as if it were solely and absolutely entitled to
                  the Funding Charged Property;

         (n)      in connection with the exercise of any of its powers,
                  execute or do, or cause or authorise to be executed or done,
                  on behalf of or in the name of Funding or otherwise, as it
                  may think fit, all documents, acts or things, acts or things
                  which it may consider appropriate;

         (o)      redeem, discharge or compromise any security whether or not
                  having priority to the security created hereunder;

         (p)      enter into covenants, guarantees, commitments, indemnities
                  and other obligations or liabilities as it shall think fit;

         (q)      pay and discharge out of the profits and income of the
                  Funding Charged Property and the monies to be made by it
                  carrying on any such business as aforesaid the expenses in
                  and about the carrying on and management of such business or
                  in the exercise of any of the powers conferred by Clause 8
                  (Receiver) or otherwise in respect of the Funding Charged
                  Property and all outgoings which it shall think fit to pay
                  and to apply the residue of the said profits, income or
                  monies in the manner provided by Clause 8.3 (Funding
                  Post-Enforcement Priority of Payments) of the First Priority
                  Funding Deed of Charge; and

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<PAGE>

         (r)      exercise any other powers, rights and/or remedies that may
                  be available at law or in equity including the powers
                  referred to in Section 1 of the Insolvency Act 1986.

8.7      Security: The Security Trustee may from time to time and at any time
         require any such Receiver to give security for the due performance of
         its duties and may fix the nature and amount of the security to be so
         given but the Security Trustee shall not be bound in any such case to
         require any such security.

8.8      Application by Receiver: Save so far as otherwise directed by the
         Security Trustee, all monies from time to time received by such
         Receiver shall be paid over to the Security Trustee to be held by it
         on the trusts declared under this Second Priority Funding Deed of
         Charge and to be distributed in accordance with Clause 8.3 (Funding
         Post-Enforcement Priority of Payments) of the First Priority Funding
         Deed of Charge and Schedule 3 (Funding Priority of Payments) to the
         First Priority Funding Deed of Charge.

8.9      Payment to Receiver: The Security Trustee may pay over to such
         Receiver any monies constituting part of the Funding Charged Property
         to the intent that the same may be applied for the purposes of this
         Second Priority Funding Deed of Charge by such Receiver and the
         Security Trustee may from time to time determine what funds the
         Receiver shall be at liberty to keep in hand with a view to the
         performance of its duties as such Receiver.

8.10     No Restrictions: None of the restrictions imposed by the 1925 Act in
         relation to the appointment of receivers or the giving of notice or
         otherwise shall apply in relation to the Receiver.

9.       Further Assurance and Power of Attorney

9.1      Further Assurance: Funding covenants with and undertakes to the
         Security Trustee from time to time (notwithstanding that the security
         may not have become enforceable and the Security Trustee may not have
         served an Intercompany Loan Enforcement Notice) upon demand:

         (a)      to execute, at Funding's cost, any document or do any act or
                  thing which the Security Trustee or any Receiver may specify
                  (including executing such Security Interests over its rights
                  in and over the Funding Charged Property and any other
                  assets of Funding in such form as the Security Trustee
                  and/or any Receiver may require) with a view to:

                  (i)      registering, perfecting, protecting or improving
                           any charge or security or Security Interest created
                           or intended to be created by or pursuant to this
                           Second Priority Funding Deed or Charge (including
                           any act or document which may be required or
                           desirable under the laws of any jurisdiction in
                           which any property or assets may be located in
                           order to confer on the Security Trustee security
                           over such property and assets equivalent or similar
                           to the security intended to be conferred by or
                           pursuant to this Second Priority Funding Deed of
                           Charge) and in such form as the Security Trustee or
                           the Receiver may specify; and/or

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<PAGE>

                  (ii)     facilitating the realisation of or enforcement of
                           rights of, all or any part of the Funding Charged
                           Property or the exercise, or proposed exercise, of
                           any of the powers, duties or discretions vested or
                           intended to be vested in the Security Trustee or
                           such Receiver by or pursuant to this Second
                           Priority Funding Deed of Charge or doing any act or
                           thing deemed necessary by the Security Trustee or
                           the Receiver,

         (b)      to give or join in giving or procuring the giving of any
                  notices to any persons and obtain or procure that there is
                  obtained any necessary acknowledgements in relation to such
                  notices, all in such form as the Security Trustee or the
                  Receiver may require and at the cost of Funding,

         and for the purpose of this Clause 9.1 a certificate in writing
         signed by the Security Trustee to the effect that any particular
         assurance or thing is required by it shall be conclusive evidence of
         that fact.

9.2      Execution of Power of Attorney: Immediately upon execution of this
         Deed, Funding shall execute and deliver to the Security Trustee the
         Power of Attorney in or substantially in the form set out in Schedule
         1.

10.      Crystallisation

         Notice: The Security Trustee may, by notice in writing to Funding,
         declare that the floating charge hereby created shall be converted
         into a specific fixed charge over such of the undertaking, property
         and assets of Funding as the Security Trustee may specify in such
         notice at any time if:

         (a)      a Potential Intercompany Loan Event of Default or
                  Intercompany Loan Event of Default has occurred; or

         (b)      it believes that the Funding Charged Property or any part
                  thereof is in danger of being seized or sold under any form
                  of distress, execution or diligence levied or is otherwise
                  in jeopardy or;

         (c)      it considers that it is desirable in order to protect the
                  priority of the security created by this Second Priority
                  Funding Deed of Charge.

11.      Provisions relating to the Security

11.1     Continuing Security:  The security created under or pursuant to this
         Second Priority Funding Deed of Charge shall be:

         (a)      in addition to and independent of and shall not operate so
                  as to prejudice or affect or merge in any other security,
                  right of recourse or other right whatsoever which may be
                  held by any of the Funding Secured Creditors or the Security
                  Trustee on their behalf in respect of the whole or any part
                  of the Funding Secured Obligations and shall not be affected
                  by any release, reassignment or discharge of such other
                  security; and

                                      13
<PAGE>

(b)               a continuing security for the Funding Secured Obligations
                  and shall remain in force as continuing security for the
                  Funding Secured Creditors and shall not be considered as
                  satisfied or discharged by any intermediate payment or
                  settlement of the whole or any part of the Funding Secured
                  Obligations or the existence at any time of a credit balance
                  on any current or other account or any other matter or thing
                  whatsoever.

11.2     Consolidation: Section 93 of the 1925 Act shall not apply in relation
         to any of the Security Interest contained in this Second Priority
         Funding Deed of Charge.

11.3     Ruling Off: If the Security Trustee receives notice of any
         Encumbrance affecting the whole or any part of the Funding Charged
         Property or any security granted hereunder in contravention of the
         provisions hereof, in each case other than the Security Interests
         created under or pursuant to the First Priority Funding Deed of
         Charge:

         (a)      the Security Trustee may open a new account in the name of
                  Funding and, if it does not, it shall nevertheless be deemed
                  to have done so at the time it received such notice; and

         (b)      all payments made by Funding to the Security Trustee after
                  the Security Trustee receives such notice shall be credited
                  or deemed to have been credited to the new account, and in
                  no circumstances whatsoever shall operate to reduce the
                  Funding Secured Obligations as at the time the Security
                  Trustee received such notice.

11.4     Avoidance of Payments: Any settlement, discharge or release between
         (a) Funding and (b) the Security Trustee or any Receiver (the
         "Relevant Person(s)") shall be conditional upon no security or
         payment granted or made to the Relevant Person(s) by Funding or any
         other person being avoided or reduced by virtue of any provisions or
         enactments relating to bankruptcy, insolvency or liquidation for the
         time being in force and, in the event of such security or payment
         being so avoided or reduced, the Relevant Person(s) shall be entitled
         to recover the value or amount of such security or payment from
         Funding and from the security subsequently as if such settlement,
         discharge or release had not occurred.

11.5     Retention of Charges: If the Security Trustee shall have reasonable
         grounds for believing that Funding may be insolvent or deemed to be
         insolvent pursuant to the provisions of the Insolvency Act 1986, as
         amended, (and production of a solvency certificate of a duly
         authorised officer of Funding shall be prima facie evidence of the
         solvency of Funding) as at the date of any payment made by Funding to
         the Security Trustee or otherwise in respect of the Funding Secured
         Obligations and that as a result, such payment may be capable of
         being avoided or clawed back, the Security Trustee shall be at
         liberty to retain the charges contained in or created pursuant to
         this Second Priority Funding Deed of Charge until the expiry of a
         period of one month plus such statutory period within which any
         assurance, security, guarantee or payment can be avoided or
         invalidated after the payment and discharge in full of all Funding
         Secured Obligations notwithstanding any release, settlement,
         discharge or arrangement which may be given or made by the Security
         Trustee on, or as a consequence of, such payment or discharge of
         liability provided that, if at any time within such period, a
         petition shall be presented to a competent court for an order for the
         winding up or the making of an administration order in respect of
         Funding, or if Funding shall commence to be wound

                                      14
<PAGE>

         up or to go into administration or any analogous proceedings shall be
         commenced by or against Funding, as the case may be, the Security
         Trustee shall be at liberty to continue to retain such security for
         such further period as the Security Trustee may determine and such
         security shall be deemed to continue to have been held as security
         for the payment and discharge to the Security Trustee of all Funding
         Secured Obligations.

11.6     Possession: Entry into possession of the Funding Charged Property or
         any part thereof shall not render the Security Trustee or any
         Receiver of Funding liable to account as mortgagee or creditor in
         possession for anything except actual receipts. If and whenever the
         Security Trustee or the Receiver enters into possession of the
         Funding Charged Property, it shall be entitled at any time to go out
         of such possession.

11.7     Change of Name, etc.: This Second Priority Funding Deed of Charge
         shall remain valid and enforceable notwithstanding any change in the
         name, composition or constitution of the Security Trustee or Funding
         or any amalgamation, merger or consolidation by the Security Trustee
         or Funding, with any other corporation (whether, in the case of
         Funding, permitted under the Funding Transaction Documents or not).

12.      Protection of Third Parties

12.1     No Enquiry: No purchaser from, or other person dealing with, the
         Security Trustee or a Receiver shall be concerned to enquire whether
         any of the powers exercised or purported to be exercised under this
         Second Priority Funding Deed of Charge has arisen or become
         exercisable, whether the Funding Secured Obligations remain
         outstanding or have become payable, whether the Security Trustee or
         the Receiver is authorised to act or as to the propriety or validity
         of the exercise or purported exercise of any power; and the title and
         the position of such a purchaser or other person shall not be
         impeachable by reference to any of those matters and all the
         protection to purchasers contained in Sections 104 and 107 of the
         1925 Act shall apply to any person purchasing from or dealing with
         the Security Trustee or any such Receiver.

12.2     Receipts to Third Parties: Upon any sale, calling in, collection,
         enforcement or other realisation of the Funding Charged Property in
         accordance with the terms hereof and upon any other dealing or
         transaction under or pursuant to this Second Priority Funding Deed of
         Charge, the receipt of the Security Trustee or any Receiver shall be
         an absolute and a conclusive discharge to a purchaser or other person
         dealing with the Security Trustee or such Receiver and shall relieve
         it of any obligation to see to the application of any monies paid to
         or by the direction of the Security Trustee or such Receiver.

13.      Set-Off

         The Security Trustee may at any time following the service of an
         Intercompany Loan Enforcement Notice without notice and
         notwithstanding any settlement of account or other matter whatsoever
         combine or consolidate all or any existing accounts of Funding
         whether in its own name or jointly with others and held by it or any
         Funding Secured Creditor and may set-off or transfer all or any part
         of any credit balance or any sum standing to the credit of any such
         account (whether or not the same is due to Funding from the Security
         Trustee or relevant

                                      15
<PAGE>

         Funding Secured Creditor and whether or not the credit balance and
         the account in debit or the Funding Secured Obligations are
         expressed in the same currency in which case the Security Trustee
         is hereby authorised to effect any necessary conversions at its
         prevailing rates of exchange) in or towards satisfaction of
         any of the Funding Secured Obligations (and on or at any time
         after the security created under this Second Priority Funding
         Deed of Charge has become enforceable in accordance with
         Clause 6.2 (Enforceable) the Security Trustee may make such
         application notwithstanding any specified maturity of any deposits)
         but subject always to the Funding Priority of Payments and may in its
         absolute discretion estimate the amount of any liability of Funding
         which is contingent or unascertained and thereafter set-off such
         estimated amount and no amount shall be payable by the Security
         Trustee to Funding unless and until all Funding Secured Obligations
         have been ascertained and fully repaid or discharged.

14.      Representations and Covenants:

14.1     Funding hereby represents to the Security Trustee that it is, as of
         the date hereof, the beneficial owner of all of the Funding Charged
         Property free and clear of all liens, claims, charges or Encumbrances
         except those specifically created by the First Priority Funding Deed
         of Charge and this Second Priority Funding Deed of Charge, and
         undertakes that it will retain all rights associated with ownership
         of the Funding Charged Property free and clear of all liens, claims,
         charges, Encumbrances except those specifically created by the First
         Priority Funding Deed of Charge and this Second Priority Funding Deed
         of Charge or any other Funding Transaction Document.

14.2     Funding represents that it has taken all necessary steps to enable it
         to create the Security Interests in respect of the Funding Charged
         Property in accordance with this Second Priority Funding Deed of
         Charge and has taken no action or steps which will or may prejudice
         its right, title and interest in, to and under the Funding Charged
         Property.

14.3     Funding hereby undertakes that, for so long as any Funding Secured
         Obligation remains outstanding, Funding shall not, save to the extent
         contemplated in or provided in the Funding Transaction Documents or
         unless it has obtained the prior written consent of the Security
         Trustee:

         (a)      either in a single transaction or in a series of
                  transactions, whether related or not and whether voluntarily
                  or involuntarily, sell, transfer, lease or otherwise dispose
                  of or grant any option over all or any part of its assets,
                  properties or undertakings or any interest, estate, right,
                  title or benefit therein or agree or purport to do any of
                  the foregoing, other than as provided for pursuant to the
                  Funding Transaction Documents;

         (b)      create or permit to subsist any Security Interest over or in
                  respect of any of its assets (unless arising by operation of
                  law) other than as provided for pursuant to the First
                  Priority Funding Deed of Charge and this Second Priority
                  Funding Deed of Charge.

                                      16
<PAGE>

15.      Terms of Appointment

15.1     By way of supplement to the Trustee Act 1925 and the Trustee Act 2000
         it is expressly declared as set out in the following provisions of
         this Clause 15 (Terms of Appointment).

15.2     Reliance on Information:

         (a)      The Security Trustee may in relation to this Second Priority
                  Funding Deed of Charge act on the opinion or advice of, or a
                  certificate or any information obtained from, any lawyer,
                  banker, valuer, surveyor, securities company, broker,
                  auctioneer, accountant or other expert in the United Kingdom
                  or elsewhere, whether obtained by the Security Trustee or
                  any Receiver, and shall not be responsible for any loss
                  occasioned by so acting. Any such opinion, advice,
                  certificate or information may be sent or obtained by
                  letter, facsimile reproduction or in any other form and the
                  Security Trustee shall not be liable for acting in good
                  faith on any opinion, advice, certificate or information
                  purporting to be so conveyed although the same shall contain
                  some error or shall not be authentic provided that such
                  error or lack of authenticity is not manifest.

         (b)      The Security Trustee may call for and shall be entitled to
                  rely upon, unless any of its officers in charge of the
                  administration of this Second Priority Funding Deed of
                  Charge shall have actual knowledge or express notice to the
                  contrary, a certificate signed by two directors of Funding
                  or a certificate of any other person in respect of every
                  matter and circumstance for which a certificate is expressly
                  provided for under this Second Priority Funding Deed of
                  Charge or the other Funding Transaction Documents and to
                  call for and rely upon, unless any of its officers in charge
                  of the administration of this Second Priority Funding Deed
                  of Charge shall have actual knowledge or express notice to
                  the contrary, a certificate of Funding or any other person
                  as to any other fact or matter prima facie within the
                  knowledge of Funding or such person as sufficient evidence
                  thereof and the Security Trustee shall not be bound in any
                  such case to call for further evidence or be responsible for
                  any loss, liability, costs, damages, expenses or
                  inconvenience that may be caused by it failing to do so.

         (c)      The Security Trustee may call for and shall be entitled to
                  rely, unless any of its officers in charge of the
                  administration of this Second Priority Funding Deed of
                  Charge shall have actual knowledge or express notice to the
                  contrary, upon any document provided to it by Funding, the
                  Mortgages Trustee or the Cash Manager in respect of every
                  matter and circumstance prima facie within the knowledge of
                  Funding, the Mortgages Trustee or the Cash Manager and the
                  Security Trustee shall not be bound in any such case to call
                  for further evidence or be responsible for any loss,
                  liability, costs, damages, expenses or inconvenience that
                  may be caused by it failing to do so.

         (d)      The Security Trustee shall be entitled to act on any
                  requests or instructions of the Note Trustee without further
                  enquiry and to assume that any requests or instructions of
                  the Note Trustee pursuant to this Second Priority Funding
                  Deed of Charge or any of the other Transaction Documents are
                  (a) given in accordance with the provisions of this Second
                  Priority Funding Deed of Charge and (b) given, where
                  appropriate, in

                                      17
<PAGE>

                  accordance with the directions of the Noteholders of the
                  relevant class, and the Security Trustee shall not be
                  liable to any person for any action taken or omitted under
                  or in connection with this Second Priority Funding Deed
                  of Charge in accordance with any such instructions or
                  requests. The Security Trustee shall be entitled to act
                  upon any notice, request or other communication of any
                  party to this Second Priority Funding Deed of Charge for
                  the purposes of this Second Priority Funding Deed of
                  Charge or any of the Transaction Documents if such notice,
                  request or other communication purports to be signed or
                  sent by or on behalf of any authorised signatory of such
                  party.

15.3     Powers and Duties:

         (a)      The Security Trustee shall not have any responsibility for
                  or have any duty to make any investigation in respect of or
                  in any way be liable whatsoever for the nature, status,
                  creditworthiness or solvency of Funding.

         (b)      The Security Trustee shall not be responsible for the scope
                  or accuracy of any recitals, statements, warranty,
                  representation or covenant of any party (other than the
                  Security Trustee) contained herein or in any other Funding
                  Transaction Document or any other document entered into in
                  connection therewith and shall assume the accuracy and
                  correctness thereof.

         (c)      The Security Trustee shall (save as expressly otherwise
                  provided herein or in the other Transaction Documents) as
                  regards all trusts, powers, authorities and discretions
                  vested in it by this Second Priority Funding Deed of Charge,
                  the other Transaction Documents or by operation of law, have
                  absolute and uncontrolled discretion as to the exercise or
                  non-exercise thereof and the Security Trustee shall not be
                  responsible for any liability that may result from the
                  exercise or non-exercise thereof but whenever the Security
                  Trustee is under the provisions of this Second Priority
                  Funding Deed of Charge bound to act at the request or
                  direction any party, the Security Trustee shall nevertheless
                  not be so bound unless first indemnified and/or provided
                  with security to its satisfaction against all actions,
                  proceedings, claims and demands to which it may render
                  itself liable and all costs, charges, damages, expenses and
                  liabilities which it may incur by so doing.

         (d)      The Security Trustee may accept without enquiry, requisition
                  or objection such title as Funding may have to the Funding
                  Charged Property or any part thereof from time to time and
                  shall not be required to investigate or make any enquiry
                  into or be liable for any defect or failure in the right or
                  title of Funding to the Funding Charged Property or any part
                  thereof from time to time whether or not any defect was
                  known to the Security Trustee or might have been discovered
                  upon examination, inquiry or investigation and whether or
                  not capable of remedy.

         (e)      The Security Trustee shall not be responsible for exercising
                  the rights of any of the parties under the Transaction
                  Documents or considering the basis upon which the approvals
                  or consents are granted by any of the parties under the
                  Transaction Documents.

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<PAGE>

         (f)      The Security Trustee shall not be bound to give notice to
                  any person of the execution of this Second Priority Funding
                  Deed of Charge nor shall it have any duty to make any
                  investigation in respect of or in any way be liable
                  whatsoever for the registration, filing, protection or
                  perfection of any security constituted by this Second
                  Priority Funding Deed of Charge or the other Funding
                  Transaction Documents relating to the Funding Charged
                  Property or the priority of the security thereby and shall
                  not be liable for any failure, omission or defect in
                  perfecting, protecting, procuring the registration of or
                  further assuring the security created or purported to be
                  created by or pursuant to this Second Priority Funding Deed
                  of Charge or other documents entered into in connection
                  herewith.

         (g)      The Security Trustee shall not have any duty to make any
                  investigation in respect of or in any way be liable
                  whatsoever for the failure to call for delivery of documents
                  of title to or require any transfers, legal mortgages,
                  charges or other further assurances in relation to any of
                  the assets the subject matter of this Funding Deed or Charge
                  or any other document.

         (h)      The Security Trustee shall be under no obligation to monitor
                  or supervise and shall not have any duty to make any
                  investigation in respect of or in any way be liable
                  whatsoever for the performance or observance by Funding or
                  any other person of the provisions of this Second Priority
                  Funding Deed of Charge or any other Funding Transaction
                  Document and shall be entitled to assume that each person is
                  properly performing and complying with its obligations.

         (i)      The Security Trustee shall not have any responsibility for
                  or have any duty to make any investigation in respect of or
                  in any way be liable whatsoever for the existence, accuracy
                  or sufficiency of any legal or other opinions, searches,
                  reports, certificates, valuations or investigations
                  delivered or obtained or required to be delivered or
                  obtained at any time in connection with the Funding Charged
                  Property.

         (j)      The Security Trustee shall not be liable or responsible for
                  any loss, cost, damage, expense or inconvenience which may
                  result from anything done or omitted to be done by it under
                  this Second Priority Funding Deed of Charge or under any of
                  the other Funding Transaction Documents save where the same
                  arises as a result of the Security Trustee's fraud, wilful
                  default or gross negligence.

         (k)      The Security Trustee shall have no responsibility whatsoever
                  to any Funding Secured Creditor as regards any deficiency
                  which might arise because the Security Trustee is subject to
                  any Tax in respect of the Funding Charged Property or any
                  part thereof or any income therefrom or any proceeds thereof
                  or is required by law to make any withholding or deduction
                  from any payment to any Funding Secured Creditor.

         (l)      The Security Trustee will not be responsible or liable for
                  any inadequacy or unfitness of any Funding Charged Property
                  as security or any decline in value or any loss realised
                  upon any disposition of the Funding Charged Property.

                                      19
<PAGE>

         (m)      The Security Trustee shall not be obliged to perfect the
                  legal title to any Mortgage in its name or any of the
                  Related Security if, in its opinion, such perfection would
                  or might result in the Security Trustee becoming liable to
                  or incurring any obligation to Funding under a Mortgage or
                  any of the Related Security and/or in its opinion, there is
                  or would be insufficient cash to discharge, in accordance
                  with the provisions of this Second Priority Funding Deed of
                  Charge such liabilities or obligations as and when they
                  arise.

         (n)      Notwithstanding the generality of the above, the Security
                  Trustee shall not be responsible for the execution,
                  legality, effectiveness, adequacy, genuineness, validity,
                  enforceability or suitability of any of the Transaction
                  Documents or any of the documents relating to the Mortgage
                  Loans or Mortgages or other documents entered into in
                  connection therewith or any security or the priority thereof
                  constituted or purported to be constituted thereby or
                  pursuant thereto nor shall it be responsible or liable to
                  any person because of any invalidity of any provisions of
                  such documents or the unenforceability thereof, whether
                  arising from statute, law or decision of any court and
                  (without prejudice to the generality of the foregoing) the
                  Security Trustee shall not have any responsibility for, or
                  have any duty to make any investigation in respect of or in
                  any way be liable whatsoever for:

                  (i)      the nature, status, creditworthiness or solvency of
                           Funding or any other person or entity who has at
                           any time provided any security or support whether
                           by way of guarantee, charge or otherwise in respect
                           of any advance made to Funding;

                  (ii)     the title, ownership, value, sufficiency or
                           existence of any Mortgaged Property;

                  (iii)    the registration, filing, protection or perfection
                           of any Mortgage Loans or Mortgages or the priority
                           of the security created thereby whether in respect
                           of any initial advance or any subsequent advance or
                           any other sums or liabilities;

                  (iv)     the scope or accuracy of any representation,
                           warranties or statements made by or on behalf of
                           Funding in any application for any advance or in
                           any mortgage or charge or any document entered into
                           in connection therewith;

                  (v)      the performance or observance by Funding or any
                           other person of any provisions of any Mortgage
                           Loans or Mortgages or in any document entered into
                           in connection therewith or the fulfilment or
                           satisfaction of any conditions contained therein or
                           relating thereto or as to the existence or
                           occurrence at any time of any default, event of
                           default or similar event contained therein or
                           waiver or consent which has at any time been
                           granted in relation to any of the foregoing;

                  (vi)     the existence, accuracy or sufficiency of any legal
                           or other opinions, searches, reports, certificates,
                           valuations or investigations delivered or obtained
                           or

                                      20
<PAGE>

                           required to be delivered or obtained at any time in
                           connection with Mortgage Loans or Mortgages;

                  (vii)    the title of the Seller or the Mortgages Trustee to
                           Mortgage Loans or Mortgages;

                  (viii)   the suitability, adequacy or sufficiency of any
                           Lending Criteria and any arrears and enforcement
                           procedures operated by the Seller or compliance
                           therewith or compliance with any applicable
                           criteria for any Further Advances or the legality
                           or recoverability or enforceability thereof or the
                           priority of the security in relation thereto;

                  (ix)     the compliance of the provisions and contents of
                           and the manner and formalities applicable to the
                           execution of the Mortgage Loans or Mortgages and
                           any documents connected therewith or the making of
                           any advance intended to be secured thereby, with
                           the relevant mortgage indemnity policies and with
                           any applicable laws or regulations (including
                           without prejudice to the generality of the
                           foregoing, the Consumer Credit Act 1974);

                    (x)    the failure by the Seller to obtain or comply with
                           any licence, consent or other authority in connection
                           with the origination, sale or purchase of any of the
                           Mortgage Loans or Mortgages or the making of any
                           advances in connection therewith or the failure to
                           effect or procure registration of or to give notice
                           to any person in relation to or otherwise protect the
                           security created or purported to be created by or
                           pursuant to any of the Mortgage Loans or Mortgages or
                           other documents entered into in connection therewith;

                    (xi)   the failure to call for delivery of documents of
                           title to or require any transfers, legal mortgages,
                           charges or other further assurances in relation to
                           any of the assets the subject matter of any of the
                           Funding Transaction Documents or any other document;

                    (xii)  any accounts, books, records or files maintained by
                           the Seller, the Administrator or any other person in
                           respect of any of the Mortgage Loans or Mortgages; or

                    (xiii) any other matter or thing relating to or in any way
                           connected with any Mortgage Loans or Mortgages or any
                           document entered into in connection therewith whether
                           or not similar to the foregoing.

               (o)  The Security Trustee shall not be responsible for, nor
                    shall it have any liability with respect to, any loss or
                    theft of the Funding Charged Property and, without
                    prejudice to any provisions relating to insurance under
                    the Funding Transaction Documents, the Security Trustee
                    shall not be under any obligation to insure any of the
                    Funding Charged Property or any deeds or documents of
                    title or other evidence in respect of the Security or to
                    require any other person to maintain such insurance and
                    the

                                      21
<PAGE>

                    Security Trustee shall not be responsible for any
                    loss, expense or liability which may be suffered as a
                    result of the lack of or inadequacy of such insurance.

               (p)  The Security Trustee shall not be responsible for any
                    liability occasioned to the Funding Charged Property
                    however caused, whether by an act or omission of Funding
                    or any other party to the Transaction Documents or any
                    other person (including any bank, broker, depositary,
                    warehouseman or other intermediary or any clearing system
                    or operator thereof) or otherwise irrespective of whether
                    the Funding Charged Property is held by or to the order of
                    any such persons, unless such loss is caused by the fraud,
                    wilful default or gross negligence of the Security
                    Trustee.

               (q)  The Security Trustee shall not be responsible for the
                    receipt or application by Funding of the proceeds of any
                    Intercompany Loan or any Start-up Loan.

               (r)  The Security Trustee shall have full power to determine
                    all questions and doubts arising in relation to any of the
                    provisions of this Second Priority Funding Deed of Charge
                    and the other Funding Transaction Documents and every such
                    determination, whether made upon a question actually
                    raised or implied in the acts or proceedings of the
                    Security Trustee, shall be conclusive and shall bind the
                    Security Trustee and the Funding Secured Creditors.

               (s)  The Security Trustee may determine whether or not a
                    default in the performance by Funding of any obligation
                    under the provisions of this Second Priority Funding Deed
                    of Charge or any other Funding Transaction Document is
                    capable of remedy and/or whether the same is materially
                    prejudicial to the interests of the Funding Secured
                    Creditors or any of them and if the Security Trustee shall
                    certify that any such default is, in its opinion, not
                    capable of remedy and/or materially prejudicial to the
                    interests of the Funding Secured Creditors or any of them,
                    such certificate shall be conclusive and binding upon the
                    Funding Secured Creditors.

               (t)  The Security Trustee shall be entitled to assume for the
                    purposes of exercising any power, trust, authority, duty
                    or discretion under or in relation to these presents or
                    any of the other Transaction Documents, that such exercise
                    will not be materially prejudicial to the interests of the
                    Noteholders if the Rating Agencies have confirmed in
                    writing that the then current ratings of the Notes would
                    not be adversely affected by such exercise.

               (u)  Unless provided otherwise in any Transaction Document,
                    where an Intercompany Loan Event of Default or a
                    Completion Event refers to materiality or like
                    terminology, any determination of materiality or like
                    terminology or the absence thereof will be in the opinion
                    of Funding as certified to the Security Trustee, which
                    certificate shall be conclusive evidence of the occurrence
                    of (or absence of) such circumstances.

               (v)  The Security Trustee shall have no liability whatsoever
                    for any loss, cost, damages or expenses directly or
                    indirectly suffered or incurred by any person as a result
                    of the delivery by the Security Trustee to Funding or any
                    other party to the Transaction

                                      22
<PAGE>

                    Documents of a certificate as to material prejudice or as
                    to no material prejudice pursuant to the Conditions or any
                    Transaction Document and any such certificate shall be
                    binding on the Funding Secured Creditors.

               (w)  The Security Trustee may, in the conduct of its trust
                    business, instead of acting personally, employ and pay an
                    agent, whether or not a lawyer or other professional
                    person, to transact or conduct, or concur in transacting
                    or conducting, any business and to do or concur in doing
                    all acts required to be done by the Security Trustee
                    (including the receipt and payment of monies). The
                    Security Trustee shall not be responsible for any
                    misconduct or omission on the part of any person appointed
                    by it or be bound to supervise the proceedings or acts of
                    any such persons and shall not be responsible for any
                    loss, costs, liability or expenses incurred by any
                    misconduct or default on the part of any such person,
                    provided that the Security Trustee has exercised
                    reasonable care in selecting any such agent.

               (x)  Any trustee of this Second Priority Funding Deed of Charge
                    being a lawyer, accountant, broker or other person engaged
                    in any profession or business shall be entitled to charge
                    and be paid all usual professional and other charges for
                    business transacted and acts done by him or his firm in
                    connection with the trusts of this deed and the Funding
                    Transaction Documents and also his charges in addition to
                    disbursements for all other work and business done and all
                    time spent by him or his firm in connection with matters
                    arising in connection with this Second Priority Funding
                    Deed of Charge and the Funding Transaction Documents,
                    including matters which might or should have been attended
                    to in person by a trustee not being a lawyer, accountant,
                    broker or other professional person.

               (y)  The Security Trustee may, in the execution of all or any
                    of the trusts, powers, authorities and discretions vested
                    in it by this Second Priority Funding Deed of Charge or
                    any of the other Funding Transaction Documents, act by
                    responsible officers or a responsible officer for the time
                    being of the Security Trustee. The Security Trustee may
                    also, whenever it thinks expedient in the interests of the
                    Funding Secured Creditors, whether by power of attorney or
                    otherwise, delegate to any person or persons all or any of
                    the trusts, rights, powers, duties, authorities and
                    discretions vested in it by this Second Priority Funding
                    Deed of Charge or any of the other Funding Transaction
                    Documents. Any such delegation may be made upon such terms
                    and conditions and subject to such regulations (including
                    power to sub-delegate) as the Security Trustee may think
                    fit in the interests of the Funding Secured Creditors,
                    provided that the Security Trustee shall have exercised
                    reasonable care in the selection of such delegate and,
                    where a power to sub-delegate has been given, shall oblige
                    the delegate to exercise reasonable care in the selection
                    of any sub-delegate. The Security Trustee shall not be
                    bound to supervise the proceedings of, or be responsible
                    for any loss, costs, liability or expenses incurred by any
                    misconduct or default on the part of, such delegate or
                    sub-delegate. The Security Trustee shall give prompt
                    notice to Funding of the appointment of any delegate as
                    aforesaid and shall procure that any delegate shall also
                    give prompt notice of the appointment of any sub-delegate
                    to Funding.

                                      23
<PAGE>

               (z)  Where it is necessary or desirable for any purpose in
                    connection with this Second Priority Funding Deed of
                    Charge to convert any sum from one currency to another it
                    shall (unless otherwise provided by this Second Priority
                    Funding Deed of Charge or required by law) be converted at
                    such rate or rates in accordance with such method and as
                    at such date for the determination of such rate of
                    exchange, as may be specified by the Security Trustee in
                    its absolute discretion but having regard to current rates
                    of exchange if available and the Security Trustee shall
                    not be liable for any loss occasioned by the said
                    conversion and any rate, method and date so specified
                    shall be binding on Funding and the Funding Secured
                    Creditors.

               (aa) Any consent given by the Security Trustee for the purposes
                    of this Second Priority Funding Deed of Charge or any of
                    the other Transaction Documents may be given on such terms
                    and subject to such conditions (if any) as the Security
                    Trustee thinks fit and may be given retrospectively.

               (bb) The Security Trustee shall not be liable for any error of
                    judgment made in good faith by any officer or employee of
                    the Security Trustee assigned by the Security Trustee to
                    administer its corporate trust matters unless the Security
                    Trustee was grossly negligent in ascertaining the
                    pertinent facts.

               (cc) The Security Trustee shall not (unless required by law or
                    ordered to do so by a court of competent jurisdiction) be
                    required to disclose to any Funding Secured Creditor or
                    other person any information made available to the
                    Security Trustee by Funding or any other person in
                    connection with the trusts of this Second Priority Funding
                    Deed of Charge or the Funding Transaction Documents and no
                    Funding Secured Creditor or other person shall be entitled
                    to take any action to obtain from the Security Trustee any
                    such information.

               (dd) Notwithstanding anything else in this Second Priority
                    Funding Deed of Charge or the other Funding Transaction
                    Documents, the Security Trustee may refrain from doing
                    anything which would or might in its opinion be contrary
                    to any law of any jurisdiction or any directive or
                    regulation of any governmental agency or which would or
                    might otherwise render it liable to any person and may do
                    anything which is, in its opinion, necessary to comply
                    with any such law, directive or regulation.

               (ee) The powers conferred by this Second Priority Funding Deed
                    of Charge upon the Security Trustee or any Receiver shall
                    be in addition to and not in substitution for any powers
                    which may from time to time be conferred on the Security
                    Trustee or any such Receiver by statute or under common
                    law.

               (ff) The Security Trustee has no duties or responsibilities
                    except those expressly set out in this Second Priority
                    Funding Deed of Charge or in the Funding Transaction
                    Documents.

               (gg) The Security Trustee shall not be responsible for the
                    maintenance of the rating of the Notes.

                                      24
<PAGE>

15.4     No Financial Liability: Notwithstanding anything else herein
         contained, the Security Trustee may refrain from taking any action or
         exercising any right, power, authority or discretion vested in it
         under this Second Priority Funding Deed of Charge, any other
         Transaction Document, any Funding Charged Property or any other
         agreement relating to the transactions herein or therein contemplated
         until it has been indemnified and/or secured to its satisfaction
         against and all liabilities which might be brought, made or conferred
         against or suffered, incurred or sustained by it as a result.
         Notwithstanding any other provision of this Second Priority Funding
         Deed of Charge or of any other Transaction Document, nothing shall
         require the Security Trustee to risk its own funds or otherwise incur
         any financial liability in the performance of any of its duties or in
         the exercise of any of its rights or powers or otherwise in
         connection with this Second Priority Funding Deed of Charge or any
         other Funding Transaction Document (including, without limitation,
         forming any opinion or employing any legal, financial or other
         adviser), if it shall believe that repayment of such funds or
         adequate indemnity against such risk or liability is not assured to
         it. Further, without prejudice to the right of indemnity by law given
         to trustees, Funding hereby covenants further, to reimburse, pay or
         discharge (on a full indemnity basis) on demand the Security Trustee
         and every attorney, receiver, manager, agent, delegate or other
         person appointed by it under this Second Priority Funding Deed of
         Charge from and against all liabilities, losses, damages, costs,
         expenses, actions, proceedings, claims and demands (including without
         limitation legal fees and any applicable value added tax or similar
         tax) incurred by or made against it or him in the execution or
         purported execution of the trusts of this Second Priority Funding
         Deed of Charge or of its or his powers or in respect of any matter or
         thing done or omitted in any way relating to this Second Priority
         Funding Deed of Charge or any of the other Funding Transaction
         Documents except such as may arise from the gross negligence or
         wilful misconduct or fraud of any such indemnified person.

15.5     Assumption of No Default:

         (a)   The Security Trustee shall not be bound to ascertain whether
               any Intercompany Loan Event of Default or Potential
               Intercompany Loan Event of Default has happened and, until it
               shall have actual knowledge or express notice to the contrary,
               the Security Trustee shall be entitled to assume that no such
               Intercompany Loan Event of Default or Potential Intercompany
               Loan Event of Default has happened and that Funding is
               observing and performing all the obligations on its part
               contained in each Intercompany Loan Agreement and no event has
               happened as a consequence of which any Intercompany Loan may
               become repayable.

         (b)   The Security Trustee shall not be bound to ascertain whether
               any Completion Event or any failure by the Seller to comply
               with any of its obligations under the Mortgage Sale Agreement
               or any event which with the giving of notice or expiry of any
               grace period or certification as specified in respect of such
               Completion Event or Seller failure of its obligations would
               constitute the same has happened and, until it shall receive
               express notice to the contrary from any party to the
               Transaction Documents, the Security Trustee shall be entitled
               to assume that no such Completion Event or Seller failure of
               its obligations or such other event as described above has
               happened and that Funding, the Administrator or the Seller (as
               the case may be) is observing

                                      25
<PAGE>

               and performing all of their respective obligations contained in
               each of the Transaction Documents to which they are a party.

          (c)  The Security Trustee shall not be bound to ascertain whether
               any material breach of any of the Representations and
               Warranties referred to in Clause 8 of the Mortgage Sale
               Agreement or any event which with the giving of notice or
               expiry of any grace period or certification as specified in
               such representation and warranties would constitute the same
               has happened and, until it shall receive express notice to the
               contrary from any party to the Transaction Documents, the
               Security Trustee shall be entitled to assume that no such
               breach or such other event as described above has happened and
               that the Seller is observing and performing its obligations
               contained in the Mortgage Sale Agreement.

          (d)  The Security Trustee shall not be bound to ascertain whether
               any termination event under the Administration Agreement or any
               event which with the giving of notice or expiry of any grace
               period or certification as specified in respect of such
               termination event would constitute the same has happened and,
               until it shall receive express notice to the contrary pursuant
               to Clause 19.5 of the Administration Agreement, the Security
               Trustee shall be entitled to assume that no such termination
               event under the Administration Agreement or such other event as
               described above has happened and that the Administrator is
               observing and performing all of its obligations contained in
               each of the Transaction Documents to which it is a party.

          (e)  The Security Trustee shall not be bound to ascertain whether
               any Cash Manager Termination Event or any event which with the
               giving of notice or expiry of any grace period or certification
               as specified in such Cash Manager Termination Event would
               constitute the same has happened and, until it shall receive
               express notice to the contrary pursuant to Clause 12.4 of the
               Cash Management Agreement, the Security Trustee shall be
               entitled to assume that no such Cash Manager Termination Event
               or such other event as described above has happened and that
               the Cash Manager is observing and performing its obligations
               contained in the Cash Management Agreement.

          (f)  The Security Trustee shall not be bound to ascertain whether
               any Termination Event under the Bank Account Agreement or the
               Funding (First Issuer) Bank Account Agreement or any event
               which with the giving of notice or expiry of any grace period
               or certification as specified in such Bank Account Agreement or
               such Funding (First Issuer) Bank Account Agreement, as
               applicable, would constitute the same has happened and, until
               it shall receive express notice to the contrary pursuant to
               Clause 8.3 of the Bank Account Agreement or the Funding (First
               Issuer) Bank Account Agreement, as applicable, the Security
               Trustee shall be entitled to assume that no such termination
               event under the Bank Account Agreement or the Funding (First
               Issuer) Bank Account Agreement or such other event as described
               above has happened and that the relevant Account Bank is
               observing and performing its obligations contained in the Bank
               Account Agreement or the Funding (First Issuer) Bank Account
               Agreement, as applicable.

                                      26
<PAGE>

          (g)  The Security Trustee shall not be bound to ascertain whether
               any Flexible Mortgages Loans or part thereof is unenforceable
               and/or does not fall within the first ranking charge by way of
               legal mortgage over the relevant Mortgaged Property has
               happened and, until it shall receive express notice to the
               contrary from any party to the Transaction Documents, the
               Security Trustee shall be entitled to assume that no such event
               has happened.

15.6     Commercial Transactions: The Security Trustee shall not, and no
         director, officer or employee of any corporation being a Security
         Trustee hereof shall by reason of the fiduciary position of the
         Security Trustee be in any way precluded from making any commercial
         contracts or entering into any commercial transactions with any party
         to the Funding Transaction Documents, whether directly or through any
         subsidiary or associated company, or from accepting the trusteeship
         of any other debenture stock, debentures or securities of any party
         to the Funding Transaction Documents, and without prejudice to the
         generality of these provisions, it is expressly declared that such
         contracts and transactions include any contract or transaction in
         relation to the placing, underwriting, purchasing, subscribing for or
         dealing with or lending monies upon or making payments in respect of
         or any stock, shares, debenture stock, debentures or other securities
         of any party to the Funding Transaction Documents or any contract of
         banking or insurance of any party to the Funding Transaction
         Documents and neither the Security Trustee nor any such director,
         officer or employee shall be accountable to any Funding Secured
         Creditor or to any party to the Funding Transaction Documents for any
         profit, fees, commissions, interest, discounts or share of brokerage
         earned, arising or resulting from any such contracts or transactions,
         and the Security Trustee and any such director, officer or employee
         shall also be at liberty to retain the same without accounting
         therefor.

15.7     Trustee Liable for Negligence: None of the provisions of this Second
         Priority Funding Deed of Charge shall, in any case in which the
         Security Trustee has failed to show the degree of care and diligence
         required of it as security trustee under this Second Priority Funding
         Deed of Charge, having regard to the provisions of this Second
         Priority Funding Deed of Charge conferring on the Security Trustee
         any powers, authorities or discretions, relieve or indemnify the
         Security Trustee against any liabilities which by virtue of any rule
         of law would otherwise attach to it in respect of any gross
         negligence, default, breach of duty or breach of trust of which it
         may be guilty in relation to its duties under this Second Priority
         Funding Deed of Charge.

15.8     Delegation of Certain Functions to Authorised Third Party: Without
         prejudice to the provisions of this Second Priority Funding Deed of
         Charge, references to the Security Trustee taking action in
         connection with any duty of the Seller or Administrator under any
         Transaction Document shall be read subject to clause 25 and Schedule
         4 of the Administration Agreement.

16.      Remuneration of the Security Trustee

16.1     Remuneration: Funding shall (subject as hereinafter provided) pay to
         the Security Trustee an annual fee of such amount as shall from time
         to time be agreed by Funding and the Security Trustee. Such
         remuneration shall be payable on Payment Dates subject to and in
         accordance with the Funding Pre-Enforcement Revenue Priority of
         Payments or, as the case may be, the

                                      27
<PAGE>

         Funding Post-Enforcement Priority of Payments. Such remuneration
         shall accrue from day to day and be payable up to and including the
         date when all of the Funding Secured Obligations have been paid or
         discharged and the Security Trustee has released, reassigned and/or
         discharged the Funding Charged Property as provided in Clause 4
         (Release of Funding Charged Property).

16.2     Additional Remuneration: In the event of the occurrence of an
         Intercompany Loan Event of Default or a Potential Intercompany Loan
         Event of Default or the Security Trustee giving an Intercompany Loan
         Enforcement Notice or the Security Trustee using its reasonable
         endeavours to appoint and maintain an Authorised Third Party or
         considering it expedient or necessary or being requested by Funding
         to undertake duties which the Security Trustee and Funding agree to
         be of an exceptional nature or otherwise outside the scope of the
         normal duties of the Security Trustee under this Second Priority
         Funding Deed of Charge, Funding shall pay to the Security Trustee
         such additional remuneration as shall be agreed between them. In the
         event of the Security Trustee failing to agree upon whether such
         duties shall be of an exceptional nature or otherwise outside the
         scope of the normal duties of the Security Trustee under this Second
         Priority Funding Deed of Charge, or upon such additional
         remuneration, then such matter shall be determined by a merchant bank
         (acting as an expert and not as an arbitrator) selected by the
         Security Trustee and approved by Funding or, failing such approval,
         nominated (on the application of the Security Trustee) by the
         President for the time being of the Law Society of England and Wales
         (the expense involved in such nomination and the fees of such
         merchant bank being payable by Funding) and the determination of any
         such merchant bank shall be final and binding upon the Security
         Trustee and Funding.

16.3     Expenses: Funding shall on written request, pay all other costs,
         charges and expenses (including legal and travelling expenses and the
         cost of using its reasonable endeavours to appoint and maintain an
         Authorised Third Party) (against production of invoices) which the
         Security Trustee or any persons appointed by it to whom any trust,
         power, authority or discretion may be delegated by it in relation to
         this Second Priority Funding Deed of Charge may properly incur.
         including but not limited to:

         (a)  the negotiation, preparation and execution of, the exercise of
              its powers and the performance of its duties under this Second
              Priority Funding Deed of Charge;

         (b)  the preservation or attempted preservation of any of the
              charges contained in or granted pursuant to this Second
              Priority Funding Deed of Charge; and

         (c)  any other action taken by or on behalf of the Security Trustee
              with a view to the recovery of the Funding Secured Obligations
              or for enforcing the security constituted in this Second
              Priority Funding Deed of Charge.

16.4     Indemnity: Funding shall indemnify the Security Trustee and any
         Receiver in respect of all proceedings, claims, actions, demands,
         losses, costs, charges, expenses and liabilities to which it (or any
         person appointed by it to whom any trust, power, authority or
         discretion may be delegated by it in the execution or purported
         execution of the trusts, powers, authorities or discretions vested in
         it by or pursuant to this Second Priority Funding Deed of Charge and

                                      28
<PAGE>

         any of the other Funding Transaction Documents to which the Security
         Trustee is a party) may be or become liable or which may be properly
         incurred by it (or any such person as aforesaid) in the execution or
         purported execution of any of its trusts, powers, authorities and
         discretions hereunder or its functions under any such appointment or
         in respect of any other matter or thing done or omitted in any way
         relating to this Second Priority Funding Deed of Charge and any of
         the other Funding Transaction Documents to which the Security Trustee
         is a party save where the same arises as a result of the fraud, gross
         negligence or wilful default by the Security Trustee or, as the case
         may be, such Receiver or any of their officers or employees or the
         breach by the Security Trustee of the terms of this Second Priority
         Funding Deed of Charge.

16.5     Stamp Duties: Funding shall, to the extent permitted by applicable
         United Kingdom law, pay all stamp duties and other duties or taxes of
         a similar nature, including for the avoidance of doubt any duty
         levied under the Stamp Act 1891 as amended and supplemented, (if any)
         payable on or arising out of or in consequence of:

         (a)  the creation of the security constituted by or pursuant to this
              Second Priority Funding Deed of Charge; and

         (b)  the execution and delivery of this Second Priority Funding Deed
              of Charge and documents executed pursuant hereto and the other
              Funding Transaction Documents (except where the obligation to
              pay all stamp duties and other duties or taxes of a similar
              nature is expressed to be the obligation of a person other than
              Funding).

16.6     VAT: All sums payable by Funding under this Second Priority Funding
         Deed of Charge are deemed to be exclusive of any amount in respect of
         VAT. If, pursuant to any provision of this Second Priority Funding
         Deed of Charge, the Security Trustee or the Receiver of Funding makes
         any taxable or deemed taxable supply to Funding, then Funding shall
         pay to the Security Trustee or the Receiver of Funding (as the case
         may be) (in addition to the consideration for the supply) an amount
         equal to the VAT charged in respect of such taxable or deemed taxable
         supply against production of a valid VAT invoice.

16.7     Interest: Subject as provided in Clause 16.8 (Payment), all sums
         payable by Funding under this Clause 16 (Remuneration of the Security
         Trustee) shall be payable on demand or, in the case of any
         remuneration payable under Clause 16.1 (Remuneration) on the due date
         specified therein and shall carry interest at the rate per annum,
         which is one per cent. per annum above the base rate from time to
         time of the National Westminster Bank Plc from the date on which they
         were paid, charged or incurred by the Security Trustee or any
         Receiver or, in the case of remuneration, the due date for payment
         thereof, to the date of actual payment.

16.8     Payment: Notwithstanding the other provisions of this Second Priority
         Funding Deed of Charge, any amount owing by Funding pursuant to this
         Clause 16 (Remuneration of the Security Trustee) shall only be
         payable by Funding subject to and in accordance with the Funding
         Pre-Enforcement Revenue Priority of Payments or, as the case may be,
         the Funding Post-Enforcement Priority of Payments.

                                      29
<PAGE>

16.9     Survival: Unless otherwise specifically stated in any discharge of
         this Second Priority Funding Deed of Charge, the provisions of this
         Clause 16 (Remuneration of the Security Trustee) shall continue in
         full force and effect notwithstanding such discharge.

17.      Appointment, Removal and Retirement of Security Trustee

17.1     Power of Funding: The power of appointing a new Security Trustee and
         removing the Security Trustee or any new Security Trustee shall be
         vested in Funding but such appointment or removal must be approved by
         the Note Trustee, after consultation with each of the Funding Secured
         Creditors (such approval not to be unreasonably withheld or delayed).
         A trust corporation may be appointed sole trustee hereof but subject
         thereto there shall be at least two trustees hereof, one at least of
         which shall be a trust corporation. Any appointment of a new Security
         Trustee and any retirement of an existing Security Trustee hereof
         shall as soon as practicable thereafter be notified by Funding to the
         Funding Secured Creditors.

17.2     U.S. Investment Company Act: Any new Security Trustee must (i) meet
         the requirements of section 26(a)(1) of the U.S. Investment Company
         Act of 1940; (ii) not be an affiliate (as defined in Rule 405 of the
         U.S. Securities Act of 1933, as amended) of any relevant Issuer or of
         any person involved in the organisation or operation of any relevant
         Issuer; (iii) not offer or provide credit or credit enhancement to
         any relevant Issuer; and (iv) execute an agreement or instrument
         concerning the Notes containing provisions to the effect set forth in
         section 26(a)(3) of the U.S. Investment Company Act of 1940.

17.3     Powers of Security Trustee to appoint: Notwithstanding the provisions
         of Clause 17.1 (Power of Funding), the Security Trustee may (as
         attorney for Funding) upon giving prior notice to Funding but without
         the consent of Funding or the Funding Secured Creditors appoint any
         person established or resident in any jurisdiction (whether a trust
         corporation or not) to act either as a separate trustee or as a
         co-trustee jointly with the Security Trustee:

         (a)  if the Security Trustee considers such appointment to be in the
              interests of the Funding Secured Creditors; or

         (b)  for the purposes of conforming to any legal requirement,
              restriction or condition in any jurisdiction in which any
              particular act or acts are to be performed or any Funding
              Charged Property is or is to be located; or

         (c)  for the purposes of obtaining a judgment in any jurisdiction or
              the enforcement in any jurisdiction either of a judgment
              already obtained or of the provisions of this Second Priority
              Funding Deed of Charge or any of the other Funding Transaction
              Documents to which the Security Trustee is a party or
              obligations arising pursuant thereto or of any of the security
              constituted by or pursuant to this Second Priority Funding Deed
              of Charge.

         Funding hereby irrevocably appoints the Security Trustee to be its
         attorney in its name and on its behalf to execute any such instrument
         of appointment. Such a person shall (subject always to the provisions
         of this Second Priority Funding Deed of Charge and any other Funding
         Transaction Document to which the Security Trustee is a party) have
         such trusts, powers,

                                      30
<PAGE>

         authorities and discretions (not exceeding those conferred on
         the Security Trustee by this Second Priority Funding Deed of
         Charge or any of the other Funding Transaction Documents to
         which the Security Trustee is a party) and such duties and
         obligations as shall be conferred or imposed on it by the instrument
         of appointment. The Security Trustee shall have power in like manner
         to remove any such person. Such proper remuneration as the Security
         Trustee may pay to any such person, together with any attributable
         costs, charges and expenses incurred by it in performing its function
         as such separate trustee or co-trustee, shall for the purposes of
         this Second Priority Funding Deed of Charge be treated as costs,
         charges and expenses incurred by the Security Trustee.

17.4     Multiple Trustees: Whenever there shall be more than two trustees
         hereof, the majority of such trustees shall (provided such majority
         includes a trust corporation) be competent to execute and exercise
         all the trusts, powers, authorities and discretions vested by this
         Second Priority Funding Deed of Charge and any of the other Funding
         Transaction Documents in the Security Trustee generally.

17.5     Retirement of Security Trustee: Subject as provided in Clause 17.6
         (Retirement or Removal not Effective), any Security Trustee for the
         time being of this Second Priority Funding Deed of Charge may retire
         at any time upon giving not less than three calendar months' prior
         notice in writing to Funding without assigning any reason therefor
         and without being responsible for any costs resulting from such
         retirement.

17.6     Retirement or Removal not Effective: The retirement or removal of any
         Security Trustee shall not become effective unless (1) there remains
         at least one trustee hereof being a trust corporation in office upon
         such retirement or removal and (2) there remains at least one trustee
         of each Issuer Trust Deed and Issuer Deed of Charge being the same
         trust corporation. Funding covenants that, in the event of a trustee
         (being a sole trustee or the only trust corporation) giving notice
         under Clause 17.5 (Retirement of Security Trustee) or being removed
         as referred to in Clause 17.1 (Power of Funding) it shall use its
         best endeavours to procure a new Security Trustee of this Deed (being
         a trust corporation) to be appointed as soon as reasonably
         practicable thereafter (for the avoidance of doubt, in the same terms
         as this Second Priority Funding Deed of Charge). If within 60 days of
         having given notice of its intention to retire, Funding has failed to
         appoint a replacement Security Trustee, the outgoing Security Trustee
         will be entitled to appoint its successor (provided that the Rating
         Agencies confirm that the then current ratings of the Notes shall not
         be either downgraded, reviewed or withdrawn as a result of such
         appointment).

17.7     Retirement or Removal of Note Trustee: If the Note Trustee retires or
         is removed in accordance with the provisions of the First Issuer
         Trust Deed and each other Issuer Trust Deed, then the Security
         Trustee shall retire at the same time in accordance with the
         provisions of this Clause 17 (Appointment, Removal and Retirement of
         Security Trustee). The successor Security Trustee and the successor
         Note Trustee shall be the same person or persons.

17.8     Merger: Any corporation into which the Security Trustee may be merged
         or converted or with which it may be consolidated, or any corporation
         resulting from any merger, conversion or consolidation to which the
         Security Trustee shall be a party, or any corporation succeeding to
         all or substantially all the corporate trust business of the Security
         Trustee, shall be the

                                      31
<PAGE>

         successor of the Security Trustee hereunder, provided such corporation
         shall be otherwise qualified and eligible under this Clause, without
         the execution or filing of any paper or any further act on the part
         of any of the parties hereto.

18.      Miscellaneous Provisions

18.1     Evidence of Indebtedness: In any action, proceedings or claim
         relating to this Second Priority Funding Deed of Charge or the
         charges contained in this Second Priority Funding Deed of Charge, a
         statement as to any amount due to any Funding Secured Creditor or of
         the Funding Secured Obligations or any part thereof or a statement of
         any amounts which have been notified to the Security Trustee as being
         amounts due to any Funding Secured Creditor which is certified as
         being correct by an officer of the Security Trustee or an officer of
         the relevant Funding Secured Creditor shall, save in the case of
         manifest error, be conclusive evidence that such amount is in fact
         due and payable.

18.2     Liability:  All the liabilities and obligations of Funding under or
         by virtue of this Second Priority Funding Deed of Charge shall not be
         impaired by:

         (a)  any failure of this Second Priority Funding Deed of Charge to
              be legal, valid, binding and enforceable as regards Funding
              whether as a result of a lack of corporate powers or of
              directors' authority, defective execution or for any other
              reason whatsoever;

         (b)  any giving of time, forbearance, indulgence or waiver as
              regards Funding;

         (c)  a discharge or release of Funding; or

         (d)  any other matter or event whatsoever whether similar to the
              foregoing or not which might have the effect of impairing all
              or any of its liabilities or obligations except proper and
              valid payment or discharge of all Funding Secured Obligations
              and amounts whatsoever which this Second Priority Funding Deed
              of Charge provides are to be paid by Funding or an absolute
              discharge or release of Funding signed by the Funding Secured
              Creditors and the Security Trustee.

19.      Rights cumulative

         The respective rights of the Security Trustee, the Mortgages Trustee,
         Funding and any Receiver to this Second Priority Funding Deed of
         Charge are cumulative and may be exercised as often as each considers
         appropriate and are in addition to their respective rights under the
         general law. No failure on the part of the Security Trustee, the
         Mortgages Trustee, Funding or any Receiver to exercise, and no delay
         in exercising, any right hereunder shall operate as a waiver thereof,
         nor shall any single or partial exercise of any such right preclude
         any other or further exercise thereof or the exercise of any other
         right. The remedies in this Deed are cumulative and not exclusive of
         any remedies provided by law.

20.      Corporate Obligations

20.1     Corporate Obligations: To the extent permitted by law, no recourse
         under any obligation, covenant, or agreement of any person contained
         in this Second Priority Funding Deed of

                                      32
<PAGE>

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

21.      Notices

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

         (a)   in the case of Funding, to Granite Finance Funding Limited
               situated at 4 Royal Mint Court, London EC3N 4HJ (facsimile
               number 020 7073 7874) for the attention of The Company
               Secretary with a copy to Northern Rock plc, Northern Rock
               House, Gosforth, Newcastle upon Tyne NE3 4PL (facsimile number
               0191 213 2203) for the attention of the Group Secretary;

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

         (c)   in the case of the Mortgages Trustee, to Granite Finance
               Trustees Limited situated at 22 Grenville Street, St. Helier,
               Jersey JE4 8PX, Channel Islands, (facsimile number 01534
               609333) for the attention of The Company Secretary with a copy
               to Northern Rock plc, Northern Rock House, Gosforth, Newcastle
               upon Tyne NE3 4PL (facsimile number 0191 213 2203) for the
               attention of the Group Secretary;

         or to such other address or facsimile number or for the attention of
         such other person or entity as may from time to time be notified by
         any party to the others by fifteen days prior written notice in
         accordance with the provisions of this Clause 21.

                                      33
<PAGE>

22.      Third Party Rights

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

23.      Execution in Counterparts; Execution and Effectiveness; Severability

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

23.2     Effectiveness of Execution: This Second Priority Funding Deed of
         Charge shall be fully effective and binding upon Funding and the
         Security Trustee upon at least one copy of this Second Priority
         Funding Deed of Charge having been executed and delivered by both
         Funding and the Security Trustee notwithstanding that any other
         person expressed to be a party to this Second Priority Funding Deed
         of Charge has not then executed and delivered this Deed and
         notwithstanding any such party has executed or executes and has
         delivered or delivers a counterpart of this Deed.

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

24.      Governing Law and Submission to Jurisdiction

24.1     Governing Law: This Second Priority Funding Deed of Charge is
         governed by, and shall be construed in accordance with, English law,
         provided that any terms hereof which are particular to the law of
         Scotland shall be construed in accordance with Scots law.

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

24.3     Process Agent: The Mortgages Trustee irrevocably and unconditionally
         appoints Mourant & Co. Capital (SPV) Limited at 4 Royal Mint Court,
         London EC3N 4HJ or otherwise at its registered office for the time
         being as its agent for service of process in England in respect of
         any proceedings in respect of this Second Priority Funding Deed of
         Charge and undertakes that in the event of Mourant & Co. Capital
         (SPV) Limited ceasing so to act it will appoint another person with a
         registered office in London as its agent for service of process.

                                      34
<PAGE>

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

IN WITNESS of which this Second Priority Funding Deed of Charge has been
executed by the parties hereto as a deed which has been delivered on the date
first appearing on page one.

EXECUTED AS A DEED by                      )
GRANITE FINANCE FUNDING LIMITED            )
acting by:                                 )

---------------------------------
Director

Name:

Title:

---------------------------------
Director/Secretary

Name:

Title:

EXECUTED AS A DEED for and                 )
on behalf of                               )
THE BANK OF NEW YORK                       )
by:                                        )

---------------------------------
Authorised Signatory

Name:

Title:

                                      35
<PAGE>

EXECUTED AS A DEED for and                 )
on behalf of                               )
GRANITE FINANCE TRUSTEES LIMITED           )
acting by:                                 )

---------------------------------
Director

Name:

Title:

---------------------------------
Director/Secretary

Name:

Title:

                                      36
<PAGE>

                                  SCHEDULE 1

                      FORM OF SECURITY POWER OF ATTORNEY

THIS POWER OF ATTORNEY is made on 28 January 2004 by Granite Finance Funding
Limited. (registered number 79308) a private limited liability company
incorporated under the laws of Jersey whose registered office is at 22
Grenville Street, St. Helier, Jersey JE4 8PX, Channel Islands (the
"Principal").

WHEREAS

(1)      By virtue of a Second Priority Funding Deed of Charge dated 28
         January 2004 between Granite Finance Funding Limited, the Security
         Trustee and the Mortgages Trustee (as amended and supplemented from
         time to time, the "Second Priority Funding Deed of Charge"),
         provision was made for the execution by the Principal of this Power
         of Attorney.

(2)      Words and phrases in this Power of Attorney shall (save where
         expressed to the contrary) have the same meanings respectively as the
         words and phrases in the Second Priority Funding Deed of Charge.

NOW THIS POWER OF ATTORNEY WITNESSETH

1.       The Principal hereby irrevocably (within the meaning of Section 4 of
         the Powers of Attorney Act 1971) and by way of security for the
         payment and performance of the Funding Secured Obligations and the
         covenants, conditions, obligations and undertakings on the part of
         the Principal contained in the Second Priority Funding Deed of Charge
         and the other Funding Transaction Documents to which the Principal is
         a party from time to time appoints The Bank of New York and any other
         person or persons for the time being the Security Trustee or Security
         Trustees of and under the Second Priority Funding Deed of Charge (the
         "Attorney") and each and every person to whom the Security Trustee
         shall from time to time have delegated the exercise of the power of
         attorney conferred by this Power of Attorney (each a "Delegate") and
         any receiver including any administrative receiver and any manager
         (the "Receiver") and/or administrator (the "Administrator") appointed
         from time to time by the Attorney or on its behalf its true and
         lawful attorney for and in the Principal's name or otherwise jointly
         and severally to sign, seal, execute, deliver, perfect and do any
         assurance, act, matter or thing which the Attorney, Delegate,
         Receiver or Administrator considers in each case to be necessary for
         the protection or preservation of the Attorney's and the Funding
         Secured Creditors' interests and rights (as described in the Second
         Priority Funding Deed of Charge) in and to the Funding Charged
         Property or which ought to be done by the Principal under the
         covenants, undertakings and provisions contained in the Second
         Priority Funding Deed of Charge and the other Funding Transaction
         Documents to which the Principal is a party from time to time and
         generally to in its name and on its behalf to exercise all or any of
         the powers, authorities or discretions conferred by or pursuant to
         the Second Priority Funding Deed of Charge on the Security Trustee
         and/or any Receiver whether on or at any time after the security has
         become enforceable in accordance with Clause 6.2 (Enforceable) of the
         Second Priority Funding Deed of Charge or in any other circumstances
         where the Attorney

                                      37
<PAGE>

         has become entitled to take any of the steps referred to in the
         Second Priority Funding Deed of Charge including (without limitation)
         any or all of the following:

         (a)      to do every act or thing which the Attorney, Delegate,
                  Receiver or Administrator may deem to be necessary, proper
                  or expedient for getting in any of the Funding Charged
                  Property and/or fully and effectively vesting, transferring
                  or assigning the Funding Charged Property or any part
                  thereof and/or the Principal's estate, right, title, benefit
                  and/or interest therein or thereto in or to the Attorney and
                  its successors in title or other person or persons entitled
                  to the benefit thereof or for carrying into effect any other
                  dealing with the Funding Charged Property whatsoever
                  permitted under the Second Priority Funding Deed of Charge
                  in the same manner and as fully and effectively as the
                  Principal could have done;

         (b)      the power by writing under its hand by an officer of the
                  Attorney (including every Receiver appointed under the
                  Second Priority Funding Deed of Charge) from time to time to
                  appoint a substitute attorney (each a "Substitute") who
                  shall have power to act on behalf of the Principal as if
                  that Substitute shall have been originally appointed
                  Attorney by this Power of Attorney and/or to revoke any such
                  appointment at any time without assigning any reason
                  therefor.

2.       In favour of the Attorney, any Delegate, any Receiver and/or
         Administrator and/or Substitute, or a person dealing with any of them
         and the successors and assigns of such a person, all acts properly
         done and documents executed or signed by the Attorney, a Delegate, a
         Receiver, an Administrator or a Substitute in the purported exercise
         of any power conferred by this Power of Attorney shall for all
         purposes be valid and binding on the Principal and its successors and
         assigns.

3.       The Principal irrevocably and unconditionally undertakes to indemnify
         the Attorney and each Delegate, Receiver and/or Administrator and/or
         Substitute appointed from time to time by the Attorney and their
         respective estates (each an "Indemnified Party") against all actions,
         proceedings, claims, costs, expenses and liabilities of every
         description arising from the exercise, or the purported exercise, of
         any of the powers conferred by this Power of Attorney, save where the
         same arises as the result of the fraud, negligence or wilful default
         of the relevant Indemnified Party or its officers or employees.

4.       The provisions of Clause 3 (Funding Security) of the Second Priority
         Funding Deed of Charge shall continue in force after the revocation
         or termination, howsoever arising, of this Power of Attorney.

5.       The laws of England and Wales shall apply to this Power of Attorney
         and the interpretation thereof and to all acts of the Attorney and
         each Delegate, Receiver and/or Administrator and/or Substitute
         carried out or purported to be carried out under the terms hereof.

6.       The Principal hereby agrees at all times hereafter to ratify and
         confirm whatsoever the said Attorney or its attorney or attorneys or
         any Delegate, Receiver or Administrator or Substitute shall properly
         and lawfully do or cause to be done in and concerning the Funding
         Charged Property.

                                      38
<PAGE>

IN WITNESS whereof this Power of Attorney has been executed as a deed by the
Principal the day and year first before written.

EXECUTED AS A DEED by                      )
GRANITE FINANCE FUNDING LIMITED            )
acting by:                                 )

---------------------------------
Director

Name:

Title:

---------------------------------
Director/Secretary

Name:

Title:

                                      39

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