Document:

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                                                                       EXECUTION

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                           AURORA LOAN SERVICES INC.,

                                   as Servicer

          LEHMAN CAPITAL, A DIVISION OF LEHMAN BROTHERS HOLDINGS INC.,

                                    as Seller

                                       and

                           AURORA LOAN SERVICES INC.,

                               as Master Servicer

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

                     Structured Asset Securities Corporation

               Mortgage Pass-Through Certificates, Series 2001-16H

                               SERVICING AGREEMENT

                           Dated as of October 1, 2001

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                                Table of Contents
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                                                                            Page
                                                                            ----

                                   ARTICLE I.

                                   DEFINITIONS

                                   ARTICLE II.
                       SELLER'S ENGAGEMENT OF SERVICER TO
                       PERFORM SERVICING RESPONSIBILITIES

Section 2.01   Contract for Servicing; Possession of Servicing Files..........12
Section 2.02   Books and Records..............................................13

                                  ARTICLE III.
                         SERVICING OF THE MORTGAGE LOANS

Section 3.01   Servicer to Service............................................13
Section 3.02   Collection of Mortgage Loan Payments...........................16
Section 3.03   Establishment of and Deposits to Custodial Account.............16
Section 3.04   Permitted Withdrawals From Custodial Account...................17
Section 3.05   Establishment of and Deposits to Escrow Account................18
Section 3.06   Permitted Withdrawals From Escrow Account......................19
Section 3.07   Maintenance of PMI Policy and/or LPMI Policy; Claims...........19
Section 3.08   Fidelity Bond and Errors and Omissions Insurance...............21
Section 3.09   Notification of Adjustments....................................21
Section 3.10   Completion and Recordation of Assignments of Mortgage and
               FHA and VA Change Notices......................................21
Section 3.11   Protection of Accounts.........................................22
Section 3.12   Title, Management and Disposition of REO Property..............22
Section 3.13   Real Estate Owned Reports......................................24
Section 3.14   MERS...........................................................24

                                   ARTICLE IV.
                           PAYMENTS TO MASTER SERVICER

Section 4.01   Remittances....................................................25
Section 4.02   Statements to Master Servicer..................................25
Section 4.03   Monthly Advances by Servicer...................................26

                                   ARTICLE V.
                          GENERAL SERVICING PROCEDURES

Section 5.01   Servicing Compensation.........................................27

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Section 5.02   Annual Audit Report............................................27
Section 5.03   Annual Officer's Certificate...................................28
Section 5.04   Transfers of Mortgaged Property................................28

                                   ARTICLE VI.
                   REPRESENTATIONS, WARRANTIES AND AGREEMENTS

Section 6.01   Representations, Warranties and Agreements of the Servicer.....29
Section 6.02   Remedies for Breach of Representations and Warranties of
               the Servicer...................................................30
Section 6.03   Additional Indemnification by the Servicer; Third Party
               Claims.........................................................31

                                  ARTICLE VII.
                                  THE SERVICER

Section 7.01   Merger or Consolidation of the Servicer........................32
Section 7.02   Limitation on Liability of the Servicer and Others.............32
Section 7.03   Limitation on Resignation and Assignment by the Servicer.......32

                                  ARTICLE VIII.
                                   TERMINATION

Section 8.01   Termination for Cause..........................................33
Section 8.02   Termination Without Cause......................................35

                                   ARTICLE IX.
                            MISCELLANEOUS PROVISIONS

Section 9.01   Successor to the Servicer......................................36
Section 9.02   Costs..........................................................37
Section 9.03   Notices........................................................38
Section 9.04   Severability Clause............................................39
Section 9.05   No Personal Solicitation.......................................39
Section 9.06   Counterparts...................................................40
Section 9.07   Place of Delivery and Governing Law............................40
Section 9.08   Further Agreements.............................................40
Section 9.09   Intention of the Parties.......................................40
Section 9.10   Successors and Assigns; Assignment of Servicing Agreement......40
Section 9.11   Assignment by Lehman Capital...................................40
Section 9.12   [Reserved.]....................................................41
Section 9.13   Waivers........................................................41
Section 9.14   Exhibits.......................................................41
Section 9.15   General Interpretive Principles................................41
Section 9.16   Reproduction of Documents......................................41

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                              EXHIBITS & SCHEDULES

EXHIBIT A             Mortgage Loan Schedule
EXHIBIT B             Custodial Account Letter Agreement
EXHIBIT C             Escrow Account Letter Agreement

SCHEDULE 1            Servicer Recordation Fees

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                               SERVICING AGREEMENT

     THIS SERVICING AGREEMENT (this "Agreement"), entered into as of the 1st day
of October, 2001, by and between LEHMAN CAPITAL, A DIVISION OF LEHMAN BROTHERS
HOLDINGS INC., a Delaware corporation (the "Seller" or "Lehman Capital"), AURORA
LOAN SERVICES INC., a Delaware corporation ("the Servicer"), and AURORA LOAN
SERVICES INC., as Master Servicer under the Trust Agreement (as defined herein)
recites and provides as follows:

                                    RECITALS

     WHEREAS, the Servicer and Lehman Brothers Bank, FSB are parties to a Flow
Servicing Agreement, dated as of August 31, 1999 (the "LBB Flow Servicing
Agreement"), pursuant to which the Servicer services certain residential, fixed
rate mortgage loans identified in Exhibit A hereto (the "LBB Mortgage Loans").

     WHEREAS, pursuant to an Assignment and Assumption dated as of October 30,
2001 and effective as of October 1, 2001, Lehman Brothers Bank, FSB has assigned
all of its rights, title and interest in the Mortgage Loans and the LBB Flow
Servicing Agreement and delegated all of its obligations under such LBB Flow
Servicing Agreement to the Seller and the Seller has accepted such assignment
and delegation.

     WHEREAS, the Servicer and Lehman Capital are parties to a Flow Servicing
Agreement, dated as of February 15, 2000 (together with the LBB Flow Servicing
Agreement, the "Flow Servicing Agreements"), pursuant to which the Servicer
services certain residential, fixed rate mortgage loans identified in Exhibit A
hereto (together with the LBB Mortgage Loans, the "Mortgage Loans").

     WHEREAS, the Seller has conveyed the Mortgage Loans on a servicing-retained
basis to Structured Asset Securities Corporation (the "Depositor"), which in
turn has conveyed the Mortgage Loans to U.S. Bank National Association, as
trustee (the "Trustee") under a trust agreement dated as of October 1, 2001 (the
"Trust Agreement"), among the Trustee, Aurora Loan Services Inc., as master
servicer (together with any successor Master Servicer appointed pursuant to the
provisions of the Trust Agreement, the "Master Servicer"), and the Depositor.

     WHEREAS, from time to time certain other of the mortgage loans conveyed by
the Depositor to the Trustee under the Trust Agreement on the Closing Date and
serviced by other servicers will subsequent to the Closing Date be transferred
to the Servicer for servicing under this Agreement and Exhibit A hereto will be
amended to include such mortgage loans which will then be "Mortgage Loans" under
this Agreement.

     WHEREAS, Lehman Capital desires that the Servicer service the Mortgage
Loans pursuant to this Agreement, and the Servicer has agreed to do so, subject
to the right of the Seller and of the Master Servicer to terminate the rights
and obligations of the Servicer hereunder at any time and to the other
conditions set forth herein.

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     WHEREAS, Lehman Capital and the Servicer agree that the provisions of the
Flow Servicing Agreements shall not apply to the Mortgage Loans for so long as
such Mortgage Loans remain subject to the provisions of the Trust Agreement;

     WHEREAS, the Master Servicer shall be obligated under the Trust Agreement,
among other things, to supervise the servicing of the Mortgage Loans on behalf
of the Trustee, and shall have the right, under certain circumstances, to
terminate the rights and obligations of the Servicer under this Servicing
Agreement.

     WHEREAS, Lehman Capital and the Servicer acknowledge and agree that Lehman
Capital will assign all of its rights and delegate all of its obligations
hereunder (excluding Lehman Capital's rights and obligations as owner of the
servicing rights relating to the Mortgage Loans) to the Trustee, and that each
reference herein to either Lehman Capital or the Seller is intended, unless
otherwise specified, to mean the Seller or the Trustee, as assignee, whichever
is the owner of the Mortgage Loans from time to time.

     NOW, THEREFORE, in consideration of the mutual agreements hereinafter set
forth and for other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the Seller and the Servicer hereby agree as
follows:

                                   ARTICLE I.

                                   DEFINITIONS

     The following terms are defined as follows (except as otherwise agreed in
writing by the parties):

     Accepted Servicing Practices: With respect to any Mortgage Loan, those
mortgage servicing practices of prudent mortgage lending institutions that
service mortgage loans of the same type as such Mortgage Loans in the
jurisdiction where the related Mortgaged Property is located.

     Act: The National Housing Act, as amended from time to time.

     Adjustable Rate Mortgage Loan: A Mortgage Loan serviced pursuant to this
Agreement under which the Mortgage Interest Rate is adjusted from time to time
in accordance with the terms and provisions of the Mortgage Note.

     Aggregate Loan Balance: At any date of determination, the outstanding
principal balance of the Mortgage Loans serviced hereunder.

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

     Ancillary Income: All income derived from the Mortgage Loans, other than
Servicing Fees, including but not limited to late charges, fees received with
respect to checks or bank drafts returned by the related bank for non-sufficient
funds, Prepayment Penalty Amounts, assumption fees, optional insurance
administrative fees and all other incidental fees and charges.

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     Appraised Value: The value set forth in an appraisal made in connection
with the origination or the refinance of the related Mortgage Loan as the value
of the Mortgaged Property.

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

     Best Efforts: Efforts determined to be reasonably diligent by the Seller or
Servicer, as the case may be, in its sole discretion. Such efforts do not
require the Seller or Servicer, as the case may be, to enter into any
litigation, arbitration or other legal or quasi-legal proceeding, nor do they
require the Seller or Servicer, as the case may be, to advance or expend fees or
sums of money in addition to those specifically set forth in this Agreement.

     Business Day: Any day other than (i) a Saturday or Sunday, or (ii) a day on
which banking and savings and loan institutions in the States of New York,
Colorado and Maryland are authorized or obligated by law or executive order to
be closed.

     Certificates: Any or all of the Certificates issued pursuant to the Trust
Agreement.

     Closing Date: October 30, 2001.

     Code: The Internal Revenue Code of 1986, as it may be amended from time to
time or any successor statute thereto, and applicable U.S. Department of the
Treasury regulations issued pursuant thereto.

     Condemnation Proceeds: All awards of settlements in respect of a Mortgaged
Property, whether permanent or temporary, partial or entire, by exercise of the
power of eminent domain or condemnation, to the extent not required to be
released to a Mortgagor in accordance with the terms of the related Mortgage
Loan documents.

     Conventional Loan: A conventional residential first or second lien fixed or
adjustable rate Mortgage Loan that is neither FHA insured nor VA guaranteed.

     Costs: For any Person, any claims, losses, damages, penalties, fines,
forfeitures, reasonable and necessary legal fees and related costs, judgments,
and other costs and expenses of such Person.

     Custodial Account: The separate account or accounts created and maintained
pursuant to Section 3.03.

     Custodial Agreement: The custodial agreements relating to custody of
certain of the Mortgage Loans, between (i) LaSalle Bank N.A. and the Trustee
and (ii) Wells Fargo Bank Minnesota, N.A. and the Trustee, each dated October 1,
2001.

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     Custodians: Each of LaSalle Bank N.A. and Wells Fargo Bank Minnesota, N.A,
and their respective successors.

     Cut-off Date: October 1, 2001.

     Depositor: Structured Asset Securities Corporation, or any successor in
interest.

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

     Due Date: The day of the month on which the Monthly Payment is due on a
Mortgage Loan, exclusive of any days of grace. With respect to the Mortgage
Loans for which payment from the Mortgagor is due on a day other than the first
day of the month, such Mortgage Loans will be treated as if the Monthly Payment
is due on the first day of the immediately succeeding month.

     Due Period: With respect to each Remittance Date, the period commencing on
the second day of the month immediately preceding the month of the Remittance
Date and ending on the first day of the month of the Remittance Date.

     Eligible Investments: Any one or more of the obligations and securities
listed below which investment provides for a date of maturity not later than the
Determination Date in each month:

         (i) direct obligations of, and obligations fully guaranteed as to
timely payment of principal and interest by, the United States of America or any
agency or instrumentality of the United States of America the obligations of
which are backed by the full faith and credit of the United States of America
("Direct Obligations");

         (ii) federal funds, or demand and time deposits in, certificates of
deposits of, or bankers' acceptances issued by, any depository institution or
trust company (including U.S. subsidiaries of foreign depositories and the
Trustee or any agent of the Trustee, acting in its respective commercial
capacity) incorporated or organized under the laws of the United States of
America or any state thereof and subject to supervision and examination by
federal or state banking authorities, so long as at the time of investment or
the contractual commitment providing for such investment the commercial paper or
other short-term debt obligations of such depository institution or trust
company (or, in the case of a depository institution or trust company which is
the principal subsidiary of a holding company, the commercial paper or other
short-term debt or deposit obligations of such holding company or deposit
institution, as the case may be) have been rated by each Rating Agency in its
highest short-term rating category or one of its two highest long-term rating
categories;

         (iii) repurchase agreements collateralized by Direct Obligations or
securities guaranteed by GNMA, FNMA or FHLMC with any registered broker/dealer
subject to Securities Investors' Protection Corporation jurisdiction or any
commercial bank insured by the FDIC, if such broker/dealer or bank has an
uninsured, unsecured and unguaranteed obligation rated by each Rating Agency in
its highest short-term rating category;

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         (iv) securities bearing interest or sold at a discount issued by any
corporation incorporated under the laws of the United States of America or any
state thereof which have a credit rating from each Rating Agency, at the time of
investment or the contractual commitment providing for such investment, at least
equal to one of the two highest long-term credit rating categories of each
Rating Agency; provided, however, that securities issued by any particular
corporation will not be Eligible Investments to the extent that investment
therein will cause the then outstanding principal amount of securities issued by
such corporation and held as part of the Trust Fund to exceed 20% of the sum of
the Aggregate Loan Balance and the aggregate principal amount of all Eligible
Investments in the Certificate Account; provided, further, that such securities
will not be Eligible Investments if they are published as being under review
with negative implications from either Rating Agency;

         (v) commercial paper (including both non-interest-bearing discount
obligations and interest-bearing obligations payable on demand or on a specified
date not more than 180 days after the date of issuance thereof) rated by each
Rating Agency in its highest short-term rating category;

         (vi) a Qualified GIC;

         (vii) certificates or receipts representing direct ownership interests
in future interest or principal payments on obligations of the United States of
America or its agencies or instrumentalities (which obligations are backed by
the full faith and credit of the United States of America) held by a custodian
in safekeeping on behalf of the holders of such receipts; and

         (viii) any other demand, money market, common trust fund or time
deposit or obligation, or interest-bearing or other security or investment, (A)
rated in the highest rating category by each Rating Agency or (B) that would not
adversely affect the then current rating by either Rating Agency of any of the
Certificates. Such investments in this subsection (viii) may include money
market mutual funds or common trust funds, including any fund for which the
Trustee, the Master Servicer or an affiliate thereof serves as an investment
advisor, administrator, shareholder servicing agent, and/or custodian or
subcustodian, notwithstanding that (x) the Trustee, the Master Servicer or an
affiliate thereof charges and collects fees and expenses from such funds for
services rendered, (y) the Trustee, the Master Servicer or an affiliate thereof
charges and collects fees and expenses for services rendered pursuant to this
Agreement, and (z) services performed for such funds and pursuant to this
Agreement may converge at any time.

     provided, however, that no such instrument shall be an Eligible Investment
if such instrument evidences either (i) a right to receive only interest
payments with respect to the obligations underlying such instrument, or (ii)
both principal and interest payments derived from obligations underlying such
instrument and the principal and interest payments with respect to such
instrument provide a yield to maturity of greater than 120% of the yield to
maturity at par of such underlying obligations.

     Errors and Omissions Insurance: Errors and Omissions Insurance to be
maintained by the Servicer in accordance with the FNMA Guides.

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     Escrow Account: The separate account or accounts created and maintained
pursuant to Section 3.05.

     Escrow Payments: With respect to any Mortgage Loan, the amounts
constituting ground rents, taxes, assessments, water rates, sewer rents,
municipal charges, mortgage insurance premiums, fire and hazard insurance
premiums, condominium charges, and any other payments required to be escrowed by
the Mortgagor with the mortgagee pursuant to the Mortgage or any other document.

     Event of Default: Any event set forth in Section 8.01.

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

     FHA: The Federal Housing Administration, an agency within the United States
Department of Housing and Urban Development, or any successor thereto and
including the Federal Housing Commissioner and the Secretary of Housing and
Urban Development where appropriate under the FHA Regulations.

     FHA Approved Mortgagee: A corporation or institution approved as a
mortgagee by FHA under the Act and applicable HUD regulations, and eligible to
own and service mortgage loans such as the FHA Loans.

     FHA Insurance Contract: The contractual obligation of FHA respecting the
insurance of a Mortgage Loan.

     FHA Loan: A residential Mortgage Loan that, as of the Cut-off Date (or, in
the case of a Qualifying Substitute Mortgage Loan, as of the date of such
substitution), is the subject of an FHA Insurance Contract as evidenced by a
mortgage insurance contract.

     FHA Mortgage Insurance: Mortgage insurance authorized under the Act and
provided by the FHA.

     FHA Regulations: Regulations promulgated by HUD under the National Housing
Act, codified in 24 Code of Federal Regulations, and other HUD issuances
relating to FHA Loans, including the related handbooks, circulars, notices and
mortgagee letters.

     FHLMC: The Federal Home Loan Mortgage Corporation, or any successor
thereto.

     Fidelity Bond: A fidelity bond to be maintained by the Servicer in
accordance with the FNMA Guides.

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

     Fixed Rate Mortgage Loan: Any individual Mortgage Loan serviced pursuant to
this Agreement as to which the Mortgage Interest Rate set forth in the Mortgage
Note is fixed for the term of such Mortgage Loan.

     FNMA: The Federal National Mortgage Association, or any successor thereto.

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     FNMA Guides: The FNMA Selling Guide and the FNMA Servicing Guide and all
amendments or additions thereto.

     GNMA: The Government National Mortgage Association, or any successor
thereto.

     HUD: The Department of Housing and Urban Development, or any federal agency
or official thereof which may from time to time succeed to the functions thereof
with regard to FHA Mortgage Insurance. The term "HUD," for purposes of this
Agreement, is also deemed to include subdivisions thereof such as the FHA and
GNMA.

     Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property
including FHA insurance proceeds, VA guaranty proceeds and proceeds of any PMI
Policy or LPMI Policy.

     Liquidation Proceeds: Cash received in connection with the liquidation of a
defaulted Mortgage Loan, whether through the sale or assignment of such Mortgage
Loan, trustee's sale, foreclosure sale or otherwise, or the sale of the related
REO Property, if the Mortgaged Property is acquired in satisfaction of the
Mortgage Loan.

     LPMI Fee: With respect to each LPMI Loan, the portion of the Mortgage
Interest Rate as set forth on the related Mortgage Loan Schedule (which shall be
payable solely from the interest portion of Monthly Payments, Insurance
Proceeds, Condemnation Proceeds or Liquidation Proceeds), which, during such
period prior to the required cancellation of the LPMI Policy, shall be used to
pay the premium due on the related LPMI Policy.

     LPMI Loan: A Mortgage Loan with an LPMI Policy, as set forth in the
Mortgage Loan Schedule or otherwise identified to the Servicer in writing.

     LPMI Policy: A policy of primary mortgage guaranty insurance issued by a
Qualified Insurer pursuant to which the related premium is to be paid by the
Servicer of the related Mortgage Loan from payments of interest made by the
Mortgagor in an amount as is set forth in the Mortgage Loan Schedule or
otherwise identified to the Servicer in writing.

     Master Servicer: Aurora Loan Services Inc., or any successor in interest,
or if any successor master servicer shall be appointed as provided in the Trust
Agreement, then such successor master servicer.

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

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     MERS Eligible Mortgage Loan: Any Mortgage Loan that has been designated by
the Servicer as recordable in the name of MERS.

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

     Monthly Advance: With respect to each Remittance Date and each Mortgage
Loan, an amount equal to the Monthly Payment (with the interest portion of such
Monthly Payment adjusted to the Mortgage Loan Remittance Rate) that was due on
the Mortgage Loan on the Due Date in the related Due Period, and that (i) was
delinquent at the close of business on the related Determination Date and (ii)
was not the subject of a previous Monthly Advance, but only to the extent that
such amount is expected, in the reasonable judgment of the Servicer, to be
recoverable from collections or other recoveries in respect of such Mortgage
Loan.

     Monthly Payment: The scheduled monthly payment of principal and interest on
a Mortgage Loan.

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

     Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note, which creates a first or second lien on an unsubordinated estate
in fee simple in real property securing the Mortgage Note.

     Mortgage Impairment Insurance Policy: A mortgage impairment or blanket
hazard insurance policy as described in the FNMA Guides.

     Mortgage Interest Rate: The annual rate of interest borne on a Mortgage
Note.

     Mortgage Loan: An individual Mortgage Loan that is the subject of this
Agreement, each Mortgage Loan subject to this Agreement being identified on the
Mortgage Loan Schedule, which Mortgage Loan includes without limitation the
Mortgage Loan documents, the Monthly Payments, Principal Prepayments,
Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds, REO Disposition
Proceeds, and all other rights, benefits, proceeds and obligations arising from
or in connection with such Mortgage Loan.

     Mortgage Loan Remittance Rate: With respect to each Mortgage Loan, the
annual rate of interest remitted to the Master Servicer, which shall be equal to
the Mortgage Interest Rate minus the applicable Servicing Fee.

     Mortgage Loan Schedule: A schedule of the Mortgage Loans setting forth
information with respect to such Mortgage Loans (including any MERS
identification number (if available) with respect to each MERS Mortgage Loan or
MERS Eligible Mortgage Loan), attached hereto as Exhibit A, which may be amended
from time to time to include additional mortgage loans which are transferred to
the Servicer by a Prior Servicer in a Servicing Transfer.

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

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     Mortgaged Property: The real property securing repayment of the debt
evidenced by a Mortgage Note.

     Mortgagor: The obligor on a Mortgage Note.

     Net Sale Proceeds: The proceeds from the sale of REO Property, net of all
expenses incurred by the Servicer in connection with such sale, including,
without limitation, legal fees and expenses, referral fees, brokerage
commissions, conveyance taxes and any other related expense.

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

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

     Opinion of Counsel: A written opinion of counsel, who may be an employee of
the Servicer, reasonably acceptable to the Seller, but which must be independent
outside counsel with respect to any such opinion of counsel concerning (i) the
non-recordation of Mortgage Loans pursuant to Section 2.02 hereof and (ii)
federal income tax matters.

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

     PMI Policy: A policy of primary mortgage guaranty insurance issued by a
Qualified Insurer, as required by this Agreement with respect to certain
Mortgage Loans.

     Prepayment Interest Shortfall Amount: With respect to any Mortgage Loan
that was subject to a Principal Prepayment in full or in part during any Due
Period, which Principal Prepayment was applied to such Mortgage Loan prior to
such Mortgage Loan's Due Date in such Due Period, the amount of interest (net
the related Servicing Fee for Principal Prepayments in full only) that would
have accrued on the amount of such Principal Prepayment during the period
commencing on the date as of which such Principal Prepayment was applied to such
Mortgage Loan and ending on the day immediately preceding such Due Date,
inclusive.

     Prepayment Penalty Amount: With respect to any Remittance Date, all
premiums or charges paid by the obligors under the Mortgage Notes due to
Principal Prepayments collected by the Servicer during the immediately preceding
Prepayment Period.

     Prepayment Period: With respect to any Remittance Date and any full or
partial Principal Prepayment, the calendar month immediately preceding the month
of such Remittance Date.

     Prime Rate: The prime rate published from time to time, as published as the
average rate in The Wall Street Journal Northeast Edition.

     Principal Prepayment: Any Mortgagor payment of principal (other than a
Balloon Payment) or other recovery of principal on a Mortgage Loan that is
recognized as having been

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received or recovered in advance of its scheduled Due Date and applied to reduce
the principal balance of the Mortgage Loan in accordance with the terms of the
Mortgage Note.

     Prior Servicer: Any prior servicer (other than the Servicer) of any of the
Mortgage Loans.

     Qualified Depository: Any of (i) a depository the accounts of which are
insured by the FDIC and the debt obligations of which are rated AA (or its
equivalent) or better by each Rating Agency; (ii) the corporate trust department
of any bank the debt obligations of which are rated at least A-1 or its
equivalent by each Rating Agency; or (iii) Lehman Brothers Bank, F.S.B., a
federal savings bank.

     Qualified Insurer: A mortgage guaranty insurance company duly authorized
and licensed where required by law to transact mortgage guaranty insurance
business and approved as an insurer by FNMA, FHLMC and GNMA.

     Rating Agency: Each of Moody's and Fitch.

     Relief Act Reduction: With respect to any Mortgage Loan as to which there
has been a reduction in the amount of the interest collectible thereon as a
result of the application of the Soldiers' and Sailors' Civil Relief Act of
1940, as amended, any amount by which interest collectible on such Mortgage Loan
for the Due Date in the related Due Period is less than the interest accrued
thereon for the applicable one-month period at the Mortgage Interest Rate
without giving effect to such reduction.

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

     Remittance Date: The 18th day (or if such 18th day is not a Business Day,
the first Business Day immediately following) of any month.

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

     REO Disposition Proceeds: All amounts received with respect to an REO
Disposition pursuant to Section 3.12.

     REO Property: A Mortgaged Property acquired by the Servicer on behalf of
the Trustee through foreclosure or by deed in lieu of foreclosure, pursuant to
Section 3.12.

     Retained Interest: The meaning set forth in the Trust Agreement.

     Retained Interest Holder: The meaning set forth in the Trust Agreement.

     Retained Interest Rate: The meaning set forth in the Trust Agreement.

     Seller: Lehman Capital, A Division of Lehman Brothers Holdings Inc., or its
successors in interest and assigns.

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     Servicer: Aurora Loan Services Inc. or its successor in interest or assigns
or any successor to the Servicer under this Agreement as herein provided.

     Servicing Advances: All customary, reasonable and necessary "out of pocket"
costs and expenses (including reasonable attorneys' fees and disbursements)
incurred in the performance by the Servicer of its servicing obligations,
including, but not limited to, the cost of (a) the preservation, restoration and
protection of the Mortgaged Property, (b) any enforcement or administrative or
judicial proceedings, including foreclosures, (c) the management and liquidation
of the Mortgaged Property if the Mortgaged Property is acquired in satisfaction
of the Mortgage, (d) taxes, assessments, water rates, sewer rents and other
charges which are or may become a lien upon the Mortgaged Property, and PMI
Policy premiums and fire and hazard insurance coverage, (e) any losses sustained
by the Servicer with respect to the liquidation of the Mortgaged Property and
(f) compliance with the obligations pursuant to the provisions of the FNMA
Guides.

     Servicing Fee: An amount equal to the sum of one-twelfth the product of (i)
a rate per annum equal to 0.25% and (ii) the outstanding principal balance of
such Mortgage Loan. The obligation of the Trustee to pay the Servicing Fee is
limited to, and the Servicing Fee is payable solely from, the interest portion
(including recoveries with respect to interest from Liquidation Proceeds to the
extent permitted by Section 3.02 of this Agreement) of such Monthly Payment
collected by the Servicer, or as otherwise provided under this Agreement.

     Servicing File: The items pertaining to a particular Mortgage Loan
including, but not limited to, the computer files, data disks, books, records,
data tapes, notes, and all additional documents generated as a result of or
utilized in originating and/or servicing each Mortgage Loan, which are held in
trust for the Trustee by the Servicer.

     Servicing Officer: Any officer of the Servicer involved in or responsible
for, the administration and servicing of the Mortgage Loans whose name appears
on a list of servicing officers furnished by the Servicer to the Master Servicer
or Seller upon request, as such list may from time to time be amended.

     Servicing Transfer: Any transfer of the servicing by a Prior Servicer of
Mortgage Loans to the Servicer under this Agreement.

     Servicing Transfer Date: The date on which a Servicing Transfer occurs.

     Trust Agreement: The Trust Agreement dated as of October 1, 2001, among the
Trustee, the Master Servicer and the Depositor.

     Trust Fund: The trust fund established by the Trust Agreement, the assets
of which consist of the Mortgage Loans and any related assets.

                                       11
<PAGE>

     Trustee: U.S. Bank National Association, or any successor in interest, or
if any successor trustee or co-trustee shall be appointed as provided in the
Trust Agreement, then such successor trustee or such co-trustee, as the case may
be.

     VA: The Veterans Administration, an agency of the United States of America,
or any successor thereto including the Administrator of Veterans Affairs.

     VA Approved Lender: Those lenders which are approved by the VA to act as a
lender in connection with the origination of VA Loans.

     VA Loan: A Mortgage Loan that, as of the Cut-off Date (or, in the case of a
Qualifying Substitute Mortgage Loan, as of the date of such substitution), is
the subject of a VA Loan Guaranty Agreement as evidenced by a Loan Guaranty
Certificate, or a Mortgage Loan which is a vendee loan sold by the VA.

     VA Loan Guaranty Agreement: The obligation of the United States to pay a
specific percentage of a Mortgage Loan (subject to a maximum amount) upon
default of the Mortgagor pursuant to the Servicemen's Readjustment Act, as
amended.

     VA Loan Guaranty Certificate: The certificate evidencing a VA Loan Guaranty
Agreement.

     VA Regulations: Regulations promulgated by the Veteran's Administration
pursuant to the Servicemen's Readjustment Act, as amended, codified in 38 Code
of Federal Regulations, and other VA issuances relating to VA Loans, including
related Handbooks, Circulars and Notices.

     Any capitalized terms used and not defined in this Agreement shall have the
meanings ascribed to such terms in the Trust Agreement.

                                   ARTICLE II.

              SELLER'S ENGAGEMENT OF SERVICER TO PERFORM SERVICING
                                RESPONSIBILITIES

     Section 2.01 Contract for Servicing; Possession of Servicing Files.

     The Seller, by execution and delivery of this Agreement, does hereby
contract with the Servicer, subject to the terms of this Agreement, for the
servicing of the Mortgage Loans. On or before the Closing Date or Servicing
Transfer Date, as applicable, the Seller shall cause to be delivered the
Servicing Files with respect to the Mortgage Loans listed on the Mortgage Loan
Schedule to the Servicer. Each Servicing File delivered to a Servicer shall be
held in trust by such Servicer for the benefit of the Trustee; provided,
however, that the Servicer shall have no liability for any Servicing Files (or
portions thereof) not delivered by the Seller. The Servicer's possession of any
portion of the Mortgage Loan documents shall be at the will of the Trustee for
the sole purpose of facilitating servicing of the related Mortgage Loan pursuant
to this Agreement, and such retention and possession by the Servicer shall be in
a custodial capacity only. The ownership of each Mortgage Note, Mortgage, and
the contents of the Servicing File

                                       12
<PAGE>

shall be vested in the Trustee and the ownership of all records and documents
with respect to the related Mortgage Loan prepared by or which come into the
possession of the Servicer shall immediately vest in the Trustee and shall be
retained and maintained, in trust, by the Servicer at the will of the Trustee in
such custodial capacity only. The portion of each Servicing File retained by the
Servicer pursuant to this Agreement shall be segregated from the other books and
records of the Servicer and shall be appropriately marked to clearly reflect the
ownership of the related Mortgage Loan by the Trustee. The Servicer shall
release from its custody the contents of any Servicing File retained by it only
in accordance with this Agreement.

     Section 2.02 Books and Records.

     (a) Subject to Section 3.01(a) hereof, as soon as practicable after the
Closing Date, the Servicing Transfer Date or the date on which a Qualifying
Substitute Mortgage Loan is delivered pursuant to Section 2.05 of the Trust
Agreement, as applicable (but in no event more than 90 days thereafter except to
the extent delays are caused by the applicable recording office), the Servicer,
at the expense of the Depositor, shall cause the Mortgage or Assignment of
Mortgage, as applicable, with respect to each MERS Eligible Mortgage Loan, to be
properly recorded in the name of MERS in the public recording office in the
applicable jurisdiction, or shall ascertain that such have previously been so
recorded.

     (b) Subject to Section 3.01(a) hereof, an Assignment of Mortgage in favor
of the Trustee shall be recorded as to each Non-MERS Mortgage Loan unless
instructions to the contrary are delivered to the Servicer, in writing, by the
Trustee. Subject to the preceding sentence, as soon as practicable after the
Closing Date or Servicing Transfer Date, as applicable (but in no event more
than 90 days thereafter except to the extent delays are caused by the applicable
recording office), the Servicer, at the expense of the Depositor, shall cause to
be properly recorded in each public recording office where such Non-MERS
Eligible Mortgage Loans are recorded each Assignment of Mortgage.

     (c) Additionally, the Servicer shall prepare and execute, at the direction
of the Trustee, any note endorsements relating to any of the Non-MERS Mortgage
Loans.

     (d) All rights arising out of the Mortgage Loans shall be vested in the
Trustee, subject to the Servicer's right to service and administer the Mortgage
Loans hereunder in accordance with the terms of this Agreement. All funds
received on or in connection with a Mortgage Loan, other than the Servicing Fee
and other compensation to which the Servicer is entitled as set forth herein,
including but not limited to in Section 5.01 below, shall be received and held
by the Servicer in trust for the benefit of the Trustee pursuant to the terms of
this Agreement.

                                  ARTICLE III.

                         SERVICING OF THE MORTGAGE LOANS

     Section 3.01 Servicer to Service.

     The Servicer, as an independent contractor, shall service and administer
the Mortgage Loans from and after the Closing Date or Servicing Transfer Date,
as applicable, and shall have full power and authority, acting alone, to do any
and all things in connection with such servicing

                                       13
<PAGE>

and administration which the Servicer may deem necessary or desirable,
consistent with the terms of this Agreement and with Accepted Servicing
Practices, including taking all actions that a mortgagee is permitted or
required to take by the FHA or VA, with respect to any FHA Loans or VA Loans, as
the case may be. Except as set forth in this Agreement, the Servicer shall
service the Mortgage Loans in strict compliance with the servicing provisions
related to the FNMA MBS Program (Special Servicing Option) of the FNMA Guides,
which include, but are not limited to, provisions regarding the liquidation of
Mortgage Loans, the collection of Mortgage Loan payments, the payment of taxes,
insurance and other charges, the maintenance of hazard insurance, the
maintenance of Mortgage Impairment Insurance Policies, the maintenance of
Fidelity Bond and Errors and Omissions Insurance, inspections, the restoration
of Mortgaged Property, the maintenance of PMI Policies, insurance claims, the
title, management and disposition of REO Property, permitted withdrawals with
respect to REO Property, REO reports, liquidation reports, and reports of
foreclosures and abandonments of Mortgaged Property, the transfer of Mortgaged
Property, the release of Mortgage Loan documents, annual statements, and
examination of records and facilities. In the event of any conflict,
inconsistency or discrepancy between any of the servicing provisions of this
Agreement and any of the servicing provisions of the FNMA Guides, the provisions
of this Agreement shall control and be binding upon the Seller, the Master
Servicer and the Servicer.

     The Seller and the Servicer additionally agree as follows:

     (a) The Servicer shall (A) record or cause to be recorded the Mortgage or
the Assignment of Mortgage, as applicable, with respect to all MERS Eligible
Mortgage Loans, in the name of MERS, or shall ascertain that such have
previously been so recorded; (B) prepare or cause to be prepared all Assignments
of Mortgage with respect to all Non-MERS Eligible Mortgage Loans; (C) record or
cause to be recorded, subject to Section 2.02(b) hereof, all Assignments of
Mortgage with respect to Non-MERS Mortgage Loans in the name of the Trustee; (D)
pay the recording costs pursuant to Section 2.02 hereof; and/or (E) track such
Mortgages and Assignments of Mortgage to ensure they have been recorded. The
Servicer shall be entitled to be paid by the Seller the fees set forth on
Schedule 1 hereto for the preparation and recordation of the Mortgages and
Assignments of Mortgage. After the expenses of such recording costs pursuant to
Section 2.02 hereof shall have been paid by the Servicer, the Servicer shall
submit to the Depositor a reasonably detailed invoice for reimbursement of
recording costs it incurred hereunder.

     (b) The Servicer shall, in accordance with the relevant provisions of the
Cranston-Gonzales National Affordable Housing Act of 1990, as the same may be
amended from time to time, and the regulations provided in accordance with the
Real Estate Settlement Procedures Act, provide notice to the Mortgagor of each
Mortgage of the transfer of the servicing thereto to the Servicer.

     (c) The Servicer shall be responsible for the preparation of and costs
associated with notifications to Mortgagors of the assumption of servicing by
the Servicer.

     Consistent with the terms of this Agreement, the Servicer may waive any
late payment charge, assumption fee or other fee that may be collected in the
ordinary course of servicing the Mortgage Loans. The Servicer shall not make any
future advances to any obligor under any

                                       14
<PAGE>

Mortgage Loan, and (unless the Mortgagor is in default with respect to the
Mortgage Loan or such default is, in the judgment of the Servicer, reasonably
foreseeable) the Servicer shall not permit any modification of any material term
of any Mortgage Loan, including any modification that would change the Mortgage
Interest Rate, defer or forgive the payment of principal or interest, reduce or
increase the outstanding principal balance (except for actual payments of
principal) or change the final maturity date on such Mortgage Loan. In the event
of any such modification which permits the deferral of interest or principal
payments on any Mortgage Loan, the Servicer shall, on the Business Day
immediately preceding the Remittance Date in any month in which any such
principal or interest payment has been deferred, make a Monthly Advance in
accordance with Section 4.03, in an amount equal to the difference between (a)
such month's principal and one month's interest at the Mortgage Loan Remittance
Rate on the unpaid principal balance of such Mortgage Loan and (b) the amount
paid by the Mortgagor. The Servicer shall be entitled to reimbursement for such
advances to the same extent as for all other advances made pursuant to Section
4.03. Without limiting the generality of the foregoing, the Servicer shall
continue, and is hereby authorized and empowered, to execute and deliver on
behalf of itself and the Trustee, all instruments of satisfaction or
cancellation, or of partial or full release, discharge and all other comparable
instruments, with respect to the Mortgage Loans and with respect to the
Mortgaged Properties. Upon the request of the Servicer, the Trustee shall
execute and deliver to the Servicer any powers of attorney and other documents,
furnished to it by the Servicer and reasonably satisfactory to the Trustee,
necessary or appropriate to enable the Servicer to carry out its servicing and
administrative duties under this Agreement. Promptly after the execution of any
assumption, modification, consolidation or extension of any Mortgage Loan, the
Servicer shall forward to the Master Servicer copies of any documents evidencing
such assumption, modification, consolidation or extension. Notwithstanding
anything to the contrary contained in this Servicing Agreement, the Servicer
shall not make or permit any modification, waiver or amendment of any term of
any Mortgage Loan that would cause any REMIC created under the Trust Agreement
to fail to qualify as a REMIC or result in the imposition of any tax under
Section 860F(a) or Section 860G(d) of the Code.

     Notwithstanding anything to the contrary in this Agreement, the Servicer
shall not (unless the Servicer determines, in its own discretion, that there
exists a situation of extreme hardship to the Mortgagor), waive any premium or
penalty in connection with a prepayment of principal of any Mortgage Loan, and
shall not consent to the modification of any Mortgage Note to the extent that
such modification relates to payment of a prepayment premium or penalty.

     In servicing and administering any FHA Loans or VA Loans, the Servicer
shall comply strictly with the National Housing Act and the FHA Regulations, the
Servicemen's Readjustment Act, the VA Regulations and administrative guidelines
issued thereunder or pursuant thereto, and, to the extent permitted hereunder,
promptly discharge all of the obligations of the mortgagee thereunder and under
each Mortgage including the payment of any fees, premiums and charges and the
timely giving of notices.

     In servicing and administering the Mortgage Loans, the Servicer shall
employ procedures (including collection procedures) and exercise the same care
that it customarily employs and exercises in servicing and administering
mortgage loans for its own account, giving due consideration to Accepted
Servicing Practices where such practices do not conflict with the

                                       15
<PAGE>

requirements of this Agreement, the FNMA Guides, the FHA Regulations and the VA
Regulations, and the Master Servicer's and the Seller's reliance on the
Servicer.

     Section 3.02 Collection of Mortgage Loan Payments.

     Continuously from the Closing Date or Servicing Transfer Date, as
applicable, until the date each Mortgage Loan ceases to be subject to this
Agreement, the Servicer shall proceed diligently to collect all payments due
under each of the Mortgage Loans when the same shall become due and payable and
shall take special care in ascertaining and estimating Escrow Payments and all
other charges that will become due and payable with respect to the Mortgage
Loans and each related Mortgaged Property, to the end that the installments
payable by the Mortgagors will be sufficient to pay such charges as and when
they become due and payable.

     Section 3.03 Establishment of and Deposits to Custodial Account.

     The Servicer shall segregate and hold all funds collected and received
pursuant to the Mortgage Loans separate and apart from any of its own funds and
general assets and shall establish and maintain one or more Custodial Accounts,
in the form of time deposit or demand accounts, titled as directed by the Master
Servicer. The Custodial Account shall be established with a Qualified
Depository. Any funds deposited in the Custodial Account may be invested in
Eligible Investments subject to the provisions of Section 3.11 hereof. Funds
deposited in the Custodial Account may be drawn on by the Servicer in accordance
with Section 3.04. The creation of any Custodial Account shall be evidenced by a
letter agreement in the form of Exhibit B. A copy of such certification or
letter agreement shall be furnished to the Master Servicer and, upon request, to
any subsequent owner of the Mortgage Loans.

     The Servicer shall deposit in the Custodial Account on a daily basis, and
retain therein, the following collections received by the Servicer and payments
made by the Servicer after the Closing Date or Servicing Transfer Date, as
applicable:

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

         (ii) all payments on account of interest on the Mortgage Loans adjusted
to the Mortgage Loan Remittance Rate;

         (iii) all Liquidation Proceeds;

         (iv) all Insurance Proceeds;

         (v) all Condemnation Proceeds that are not applied to the restoration
or repair of the Mortgaged Property or released to the Mortgagor;

         (vi) any Prepayment Interest Shortfall Amount;

         (vii) all Advances made by the Servicer pursuant to Section 4.03;

                                       16
<PAGE>

         (viii) any amounts required to be deposited by the Servicer in
connection with the deductible clause in any blanket hazard insurance policy;

         (ix) any amounts received with respect to or related to any REO
Property or REO Disposition Proceeds; and

         (x) any other amount required hereunder to be deposited by the Servicer
in the Custodial Account.

     Any interest paid on funds deposited in the Custodial Account by the
depository institution shall accrue to the benefit of the Servicer and the
Servicer shall be entitled to retain and withdraw such interest from the
Custodial Account pursuant to Section 3.04. Additionally, any other benefit
derived from the Custodial Account associated with the receipt, disbursement and
accumulation of principal, interest, taxes, hazard insurance, mortgage
insurance, etc. shall accrue to the Servicer.

     Section 3.04 Permitted Withdrawals From Custodial Account.

     The Servicer shall, from time to time, withdraw funds from the Custodial
Account for the following purposes:

         (i) to make payments to the Master Servicer in the amounts and in the
manner provided for in Section 4.01;

         (ii) with respect to each LPMI Loan, in the amount of the related LPMI
Fee, to make payments with respect to premiums for LPMI Policies;

         (iii) in the event the Servicer has elected not to retain the Servicing
Fee out of any Mortgagor payments on account of interest or other recovery of
interest with respect to a particular Mortgage Loan (including late collections
of interest on such Mortgage Loan, or interest portions of Insurance Proceeds or
Liquidation Proceeds) prior to the deposit of such Mortgagor payment or recovery
in the Custodial Account, to pay to itself the related Servicing Fee from all
such Mortgagor payments on account of interest or other such recovery for
interest with respect to that Mortgage Loan;

         (iv) to pay itself investment earnings on funds deposited in the
Custodial Account;

         (v) to clear and terminate the Custodial Account upon the termination
of this Agreement;

         (vi) to transfer funds to another Qualified Depository in accordance
with Section 3.11 hereof;

         (vii) to invest funds in certain Eligible Investments in accordance
with Section 3.11 hereof;

                                       17
<PAGE>

         (viii) to reimburse itself for Monthly Advances of the Servicer's funds
made pursuant to Section 4.03, the Servicer's right to reimburse itself pursuant
to this subclause (viii) with respect to any Mortgage Loan being limited to
amounts received on or in respect of the related Mortgage Loan which represent
late recoveries of payments of principal or interest with respect to which a
Monthly Advance was made, it being understood that, in the case of any such
reimbursement, the Servicer's right thereto shall be prior to the rights of the
Trust Fund; provided, however, that following the final liquidation of a
Serviced Mortgage Loan, the Servicer may reimburse itself for previously
unreimbursed Monthly Advances in excess of Liquidation Proceeds or Insurance
Proceeds with respect to such Serviced Mortgage Loan from any funds in the Trust
Custodial Account, it being understood, in the case of any such reimbursement,
that the Servicer's right thereto shall be prior to the rights of the Trust
Fund. The Servicer may recover at any time from amounts on deposit in the
Custodial Account the amount of any Monthly Advances that the Servicer deems
nonrecoverable or that remain unreimbursed to the Servicer from related
Liquidation Proceeds after the final liquidation of the Serviced Mortgage Loan.
In addition, the Servicer may, at any time, withdraw from the Trust Custodial
Account funds that were not included in the Total Available Amount (as defined
in the Trust Agreement) for the preceding Distribution Date to reimburse itself
for Monthly Advances previously made by the Servicer; and,

         (ix) to reimburse itself for unreimbursed Servicing Advances, and for
any unpaid Servicing Fees, the Servicer's right to reimburse itself pursuant to
this subclause (ix) with respect to any Mortgage Loan being limited to related
Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds, REO Disposition
Proceeds and other amounts received in respect of the related REO Property, and
such other amounts as may be collected by the Servicer from the Mortgagor or
otherwise relating to the Mortgage Loan, it being understood that, in the case
of any such reimbursement, the Servicer's right thereto shall be prior to the
rights of the Trust Fund.

     Section 3.05 Establishment of and Deposits to Escrow Account.

     The Servicer shall segregate and hold all funds collected and received
pursuant to a Mortgage Loan constituting Escrow Payments separate and apart from
any of its own funds and general assets and shall establish and maintain one or
more Escrow Accounts, in the form of time deposit or demand accounts, titled as
directed by the Master Servicer. The Escrow Accounts shall be established with a
Qualified Depository in a manner that shall provide maximum available insurance
thereunder. Funds deposited in the Escrow Account may be drawn on by the
Servicer in accordance with Section 3.06. The creation of any Escrow Account
shall be evidenced by a letter agreement in the form of Exhibit C. A copy of
such certification or letter agreement shall be furnished to the Master Servicer
and, upon request, to any subsequent owner of the Mortgage Loans.

     The Servicer shall deposit in the Escrow Account or Accounts on a daily
basis, and retain therein:

         (i) all Escrow Payments collected on account of the Mortgage Loans, for
the purpose of effecting timely payment of any such items as required under the
terms of this Agreement; and

                                       18
<PAGE>

         (ii) all amounts representing Insurance Proceeds or Condemnation
Proceeds that are to be applied to the restoration or repair of any Mortgaged
Property.

     The Servicer shall make withdrawals from the Escrow Account only to effect
such payments as are required under this Agreement, as set forth in Section
3.06. The Servicer shall retain any interest paid on funds deposited in the
Escrow Account by the depository institution, other than interest on escrowed
funds required by law to be paid to the Mortgagor. Additionally, any other
benefit derived from the Escrow Account associated with the receipt,
disbursement and accumulation of principal, interest, taxes, hazard insurance,
mortgage insurance, etc. shall accrue to the Servicer. To the extent required by
law, the Servicer shall pay interest on escrowed funds to the Mortgagor
notwithstanding that the Escrow Account may be non-interest bearing or that
interest paid thereon is insufficient for such purposes.

     Section 3.06 Permitted Withdrawals From Escrow Account.

     Withdrawals from the Escrow Account or Accounts may be made by the Servicer
only:

         (i) to effect timely payments of ground rents, taxes, assessments,
water rates, sewer rents, mortgage insurance premiums, condominium charges, fire
and hazard insurance premiums or other items constituting Escrow Payments for
the related Mortgage;

         (ii) to refund to any Mortgagor any funds found to be in excess of the
amounts required under the terms of the related Mortgage Loan;

         (iii) for transfer to the Custodial Account and application to reduce
the principal balance of the Mortgage Loan in accordance with the terms of the
related Mortgage and Mortgage Note;

         (iv) for application to restoration or repair of the Mortgaged Property
in accordance with the FNMA Guides;

         (v) for transfer to the Custodial Account of fire and hazard insurance
proceeds and Escrow Payments with respect to any FHA Loan or VA Loan, where the
FHA or the VA, respectively, has directed application of funds as a credit
against the proceeds of the FHA Insurance Contract or VA Loan Guaranty
Agreement;

         (vi) to pay to the Servicer, or any Mortgagor to the extent required by
law, any interest paid on the funds deposited in the Escrow Account; and

         (vii) to clear and terminate the Escrow Account on the termination of
this Agreement.

     Section 3.07 Maintenance of PMI Policy and/or LPMI Policy; Claims.

     The Servicer shall comply with all provisions of applicable state and
federal law relating to the cancellation of, or collection of premiums with
respect to, PMI Policies, including, but not limited to, the provisions of the
Homeowners Protection Act of 1998, and all regulations promulgated thereunder,
as amended from time to time. The Servicer shall be obligated to make

                                       19
<PAGE>

premium payments with respect to (a) LPMI Policies, and (b) if the Mortgagor
fails to pay any PMI Policy premium, such PMI Policy.

     With respect to each Mortgage Loan (other than LPMI Loans) with a loan to
value ratio at origination in excess of 80%, the Servicer shall maintain or
cause the Mortgagor to maintain (to the extent that the Mortgage Loan requires
the Mortgagor to maintain such insurance) in full force and effect a PMI Policy,
and shall pay or shall cause the Mortgagor to pay the premium thereon on a
timely basis, until the LTV of such Mortgage Loan is reduced to 80%. In the
event that such PMI Policy shall be terminated, the Servicer shall obtain from
another Qualified Insurer a comparable replacement policy, with a total coverage
equal to the remaining coverage of such terminated PMI Policy, at substantially
the same fee level. The Servicer shall not take any action which would result in
noncoverage under any applicable PMI Policy of any loss which, but for the
actions of the Servicer would have been covered thereunder. In connection with
any assumption or substitution agreements entered into or to be entered into
with respect to a Mortgage Loan, the Servicer shall promptly notify the insurer
under the related PMI Policy, if any, of such assumption or substitution of
liability in accordance with the terms of such PMI Policy and shall take all
actions which may be required by such insurer as a condition to the continuation
of coverage under such PMI Policy. If such PMI Policy is terminated as a result
of such assumption or substitution of liability, the Servicer shall obtain a
replacement PMI Policy as provided above.

     With respect to LPMI Loans, the Servicer shall maintain in full force and
effect the related LPMI Policy, and from time to time, withdraw the LPMI Fee
with respect to such LPMI Loan from the Custodial Account in order to pay the
premium thereon on a timely basis, until the LTV of such Mortgage Loan is
reduced to 80%. In the event that the interest payments made with respect to any
LPMI Loan are less than the LPMI Fee, the Servicer shall advance from its own
funds the amount of any such shortfall in the LPMI Fee, in payment of the
premium on the related LPMI Policy. Any such advance shall be a Servicing
Advance subject to reimbursement pursuant to the provisions on Section 3.04. In
the event that such LPMI Policy shall be terminated, the Servicer shall obtain
from another Qualified Insurer a comparable replacement policy, with a total
coverage equal to the remaining coverage of such terminated LPMI Policy, at
substantially the same fee level. The Servicer shall not take any action which
would result in noncoverage under any applicable LPMI Policy of any loss which,
but for the actions of the Servicer would have been covered thereunder. In
connection with any assumption or substitution agreement entered into or to be
entered into with respect to a Mortgage Loan, the Servicer shall promptly notify
the insurer under the related LPMI Policy, if any, of such assumption or
substitution of liability in accordance with the terms of such LPMI Policy and
shall take all actions which may be required by such insurer as a condition to
the continuation of coverage under such PMI Policy. If such LPMI Policy is
terminated as a result of such assumption or substitution of liability, the
Servicer shall obtain a replacement LPMI Policy as provided above.

     In connection with its activities as servicer, the Servicer agrees to
prepare and present, on behalf of itself and the Owner, claims to the insurer
under any PMI Policy or LPMI Policy in a timely fashion in accordance with the
terms of such PMI Policy or LPMI Policy and, in this regard, to take such action
as shall be necessary to permit recovery under any PMI Policy or LPMI Policy
respecting a defaulted Mortgage Loan. Any amounts collected by the Servicer

                                       20
<PAGE>

under any PMI Policy or LPMI Policy shall be deposited in the Custodial Account,
subject to withdrawal pursuant to Section 3.04.

     Section 3.08 Fidelity Bond and Errors and Omissions Insurance.

     The Servicer shall keep in force during the term of this Agreement a
Fidelity Bond and Errors and Omissions Insurance. Such Fidelity Bond and Errors
and Omissions Insurance shall be maintained with recognized insurers and shall
be in such form and amount as would permit the Servicer to be qualified as a
FNMA or FHLMC seller-servicer. The Servicer shall be deemed to have complied
with this provision if an affiliate of the Servicer has such errors and
omissions and fidelity bond coverage and, by the terms of such insurance policy
or fidelity bond, the coverage afforded thereunder extends to the Servicer. The
Servicer shall furnish to the Master Servicer a copy of each such bond and
insurance policy if (i) the Master Servicer so requests and (ii) the Servicer is
not an affiliate of Lehman Brothers Inc. at the time of such request.

     Section 3.09 Notification of Adjustments.

     With respect to each Adjustable Rate Mortgage Loan, the Servicer shall
adjust the Mortgage Interest Rate on the related interest rate adjustment date
and shall adjust the Monthly Payment on the related mortgage payment adjustment
date, if applicable, in compliance with the requirements of applicable law and
the related Mortgage and Mortgage Note. The Servicer shall execute and deliver
any and all necessary notices required under applicable law and the terms of the
related Mortgage Note and Mortgage regarding the Mortgage Interest Rate and
Monthly Payment adjustments. The Servicer shall promptly, upon written request
therefor, deliver to the Master Servicer such notifications and any additional
applicable data regarding such adjustments and the methods used to calculate and
implement such adjustments. Upon the discovery by the Servicer or the receipt of
notice from the Master Servicer that the Servicer has failed to adjust a
Mortgage Interest Rate or Monthly Payment in accordance with the terms of the
related Mortgage Note, the Servicer shall immediately deposit in the Custodial
Account from its own funds the amount of any interest loss or deferral caused
thereby.

     Section 3.10 Completion and Recordation of Assignments of Mortgage and FHA
and VA Change Notices.

     As soon as practicable after the Closing Date, the Servicing Transfer Date
or the date on which a Qualifying Substitute Mortgage Loan is delivered pursuant
to Section 2.05 of the Trust Agreement, as applicable (but in no event more than
90 days thereafter except to the extent delays are caused by the applicable
government agency), the Servicer shall cause the endorsements on the Mortgage
Note (if applicable), the Assignments of Mortgage (subject to Section 3.01(a)),
the assignment of security agreement and the HUD form 92080 Mortgage Record
Change with respect to all FHA Loans to be completed in the name of the Trustee
(or MERS, as applicable), and shall give notice to the VA of a transfer of
insurance credits, if applicable, with respect to VA Loans on the form
prescribed by the VA.

                                       21
<PAGE>

     Section 3.11 Protection of Accounts.

     The Servicer may transfer the Custodial Account or the Escrow Account to a
different Qualified Depository from time to time. Such transfer shall be made
only upon obtaining the consent of the Master Servicer, which consent shall not
be withheld unreasonably.

     The Servicer shall bear any expenses, losses or damages sustained by the
Master Servicer or the Trustee if the Custodial Account and/or the Escrow
Account are not demand deposit accounts.

     Amounts on deposit in the Custodial Account and the Escrow Account may at
the option of the Servicer be invested in Eligible Investments; provided that in
the event that amounts on deposit in the Custodial Account or the Escrow Account
exceed the amount fully insured by the FDIC (the "Insured Amount") the Servicer
shall be obligated to invest the excess amount over the Insured Amount in
Eligible Investments on the same Business Day as such excess amount becomes
present in the Custodial Account or the Escrow Account. Any such Eligible
Investment shall mature no later than the Business Day immediately preceding the
related Remittance Date, provided, however, that if such Eligible Investment is
an obligation of a Qualified Depository (other than the Servicer) that maintains
the Custodial Account or the Escrow Account, then such Eligible Investment may
mature on the related Remittance Date. Any such Eligible Investment shall be
made in the name of the Servicer in trust for the benefit of the Trustee. All
income on or gain realized from any such Eligible Investment shall be for the
benefit of the Servicer and may be withdrawn at any time by the Servicer. Any
losses incurred in respect of any such investment shall be deposited in the
Custodial Account or the Escrow Account, by the Servicer out of its own funds
immediately as realized.

     Section 3.12 Title, Management and Disposition of REO Property.

     In the event that title to any Mortgaged Property is acquired in
foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale
shall be taken in the name of the Trustee (or MERS, as applicable), or in the
event the Trustee is not authorized or permitted to hold title to real property
in the state where the REO Property is located, or would be adversely affected
under the "doing business" or tax laws of such state by so holding title, the
deed or certificate of sale shall be taken in the name of such Person or Persons
as shall be consistent with an Opinion of Counsel obtained by the Servicer from
any attorney duly licensed to practice law in the state where the REO Property
is located. The Person or Persons holding such title other than the Trustee
shall acknowledge in writing that such title is being held as nominee for the
Trustee.

     The Servicer shall manage, conserve, protect and operate each REO Property
for the Trustee solely for the purpose of its prompt disposition and sale. The
Servicer, either itself or through an agent selected by the Servicer, shall
manage, conserve, protect and operate the REO Property in the same manner that
it manages, conserves, protects and operates other foreclosed property for its
own account, and in the same manner that similar property in the same locality
as the REO Property is managed. The Servicer shall attempt to sell the same (and
may temporarily rent the same for a period not greater than one year, except as
otherwise provided below) on such terms and conditions as the Servicer deems to
be in the best interest of the Trustee.

                                       22
<PAGE>

     Notwithstanding anything to the contrary contained in this Section 3.12, in
connection with a foreclosure or acceptance of a deed in lieu of foreclosure, in
the event the Servicer has reasonable cause to believe that a Mortgaged Property
is contaminated by hazardous or toxic substances or wastes, or if the Trustee or
the Master Servicer otherwise requests, an environmental inspection or review of
such Mortgaged Property to be conducted by a qualified inspector shall be
arranged by the Servicer. Upon completion of the inspection, the Servicer shall
provide the Trustee and the Master Servicer with a written report of such
environmental inspection. In the event that the environmental inspection report
indicates that the Mortgaged Property is contaminated by hazardous or toxic
substances or wastes, the Servicer shall not proceed with foreclosure or
acceptance of a deed in lieu of foreclosure. In the event that the environmental
inspection report is inconclusive as to the whether or not the Mortgaged
Property is contaminated by hazardous or toxic substances or wastes, the
Servicer shall not, without the prior approval of the Trustee, proceed with
foreclosure or acceptance of a deed in lieu of foreclosure. In such instance,
the Trustee shall be deemed to have approved such foreclosure or acceptance of a
deed in lieu of foreclosure unless the Trustee notifies the Servicer in writing,
within two (2) Business Days after its receipt of written notice of the proposed
foreclosure or deed in lieu of foreclosure from the Servicer, that it
disapproves of the related foreclosure or acceptance of a deed in lieu of
foreclosure. The Servicer shall be reimbursed for all Servicing Advances made
pursuant to this paragraph with respect to the related Mortgaged Property from
the Custodial Account.

     The Servicer shall use its Best Efforts to dispose of the REO Property as
soon as possible and shall sell such REO Property in any event within three
years after title has been taken to such REO Property, unless (a) a REMIC
election has not been made with respect to the arrangement under which the
Mortgage Loans and the REO Property are held, and (b) the Servicer determines,
and gives an appropriate notice to the Master Servicer to such effect, that a
longer period is necessary for the orderly liquidation of such REO Property. If
a period longer than three years is permitted under the foregoing sentence and
is necessary to sell any REO Property, (i) the Servicer shall report monthly to
the Master Servicer as to the progress being made in selling such REO Property
and (ii) if, with the written consent of the Trustee, a purchase money mortgage
is taken in connection with such sale, such purchase money mortgage shall name
the Servicer as mortgagee, and such purchase money mortgage shall not be held
pursuant to this Agreement, but instead a separate participation agreement among
the Servicer and Trustee shall be entered into with respect to such purchase
money mortgage. Notwithstanding anything herein to the contrary, the Servicer
shall not be required to provide financing for the sale of any REO Property.

     The Servicer shall also maintain on each REO Property fire and hazard
insurance with extended coverage in amount which is at least equal to the
maximum insurable value of the improvements which are a part of such property,
liability insurance and, to the extent required and available under the Flood
Disaster Protection Act of 1973, as amended, flood insurance in the amount
required above.

     Subject to the approval of the Master Servicer as described in this
paragraph, the disposition of REO Property shall be carried out by the Servicer
at such price, and upon such terms and conditions, as the Servicer deems to be
in the best interests of the Trust Fund. Prior to acceptance by the Servicer of
an offer to sell any REO Property, the Servicer shall notify the

                                       23
<PAGE>

Master Servicer and the Trustee of such offer in writing which notification
shall set forth all material terms of said offer (each a "Notice of Sale"). The
Master Servicer shall be deemed to have approved the sale of any REO Property
unless the Master Servicer notifies the Servicer in writing, within 2 Business
Days after its receipt of the related Notice of Sale, that it disapproves of the
related sale. With respect to any REO Property, upon a REO Disposition, the
Servicer shall be entitled to retain from REO Disposition Proceeds a disposition
fee equal to $1,250.

     The Servicer shall withdraw from the Custodial Account funds necessary for
the proper operation, management and maintenance of the REO Property, including
the cost of maintaining any hazard insurance pursuant to the FNMA Guides. The
Servicer shall make monthly distributions on each Remittance Date to the Master
Servicer of the net cash flow from the REO Property (which shall equal the
revenues from such REO Property net of the expenses described in this Section
3.12 and of any reserves reasonably required from time to time to be maintained
to satisfy anticipated liabilities for such expenses).

     Section 3.13 Real Estate Owned Reports.

     Together with the statement furnished pursuant to Section 4.02, the
Servicer shall furnish to the Master Servicer on or before the Remittance Date
each month a statement with respect to any REO Property covering the operation
of such REO Property for the previous month and the Servicer's efforts in
connection with the sale of such REO Property and any rental of such REO
Property incidental to the sale thereof for the previous month. That statement
shall be accompanied by such other information as the Master Servicer shall
reasonably request.

     Section 3.14 MERS.

     (a) The Servicer shall take such actions as are necessary to cause the
Trustee to be clearly identified as the owner of each MERS Mortgage Loan on the
records of MERS for purposes of the system of recording transfers of beneficial
ownership of mortgages maintained by MERS.

     (b) The Servicer shall maintain in good standing its membership in MERS. In
addition, the Servicer shall comply with all rules, policies and procedures of
MERS, including the Rules of Membership, as amended, and the MERS Procedures
Manual, as amended.

     (c) With respect to all MERS Mortgage Loans serviced hereunder, the
Servicer shall promptly notify MERS as to any transfer of beneficial ownership
or release of any security interest in such Mortgage Loans.

     (d) With respect to all MERS Mortgage Loans serviced hereunder, the
Servicer shall notify MERS as to any transfer of servicing pursuant to Section
3.15 or Section 9.01 within 10 Business Days of such transfer of servicing. The
Servicer shall cooperate with the Trustee, the Master Servicer and any successor
Servicer to the extent necessary to ensure that such transfer of servicing is
appropriately reflected on the MERS system.

                                       24
<PAGE>

                                  ARTICLE IV.

                           PAYMENTS TO MASTER SERVICER

     Section 4.01 Remittances.

     On each Remittance Date the Servicer shall remit by wire transfer of
immediately available funds to the Master Servicer (a) all amounts deposited in
the Custodial Account as of the close of business on the last day of the related
Due Period (net of charges against or withdrawals from the Custodial Account
pursuant to Section 3.04), plus (b) all Monthly Advances, if any, which the
Servicer is obligated to make pursuant to Section 4.03, minus (c) any amounts
attributable to Principal Prepayments, Liquidation Proceeds, Insurance Proceeds,
Condemnation Proceeds or REO Disposition Proceeds received after the applicable
Prepayment Period, which amounts shall be remitted on the following Remittance
Date, together with any additional interest required to be deposited in the
Custodial Account in connection with such Principal Prepayment in accordance
with Section 3.03(vi), and minus (d) any amounts attributable to Monthly
Payments collected but due on a Due Date or Due Dates subsequent to the first
day of the month in which such Remittance Date occurs, which amounts shall be
remitted on the Remittance Date next succeeding the Due Date related to such
Monthly Payment.

     With respect to any remittance received by the Master Servicer after the
Business Day on which such payment was due, the Servicer shall pay to the Master
Servicer interest on any such late payment at an annual rate equal to the Prime
Rate, adjusted as of the date of each change, plus two (2) percentage points,
but in no event greater than the maximum amount permitted by applicable law.
Such interest shall be deposited in the Custodial Account by the Servicer on the
date such late payment is made and shall cover the period commencing with the
day following such Business Day and ending with the Business Day on which such
payment is made, both inclusive. Such interest shall be remitted along with the
distribution payable on the next succeeding Remittance Date. The payment by the
Servicer of any such interest shall not be deemed an extension of time for
payment or a waiver of any Event of Default by the Servicer.

     All remittances required to be made to the Master Servicer shall be made to
the following wire account or to such other account as may be specified by the
Master Servicer from time to time:

          The Chase Manhattan Bank
          New York, New York
          ABA#: 021-000-021
          Account Name:  Aurora Loan Services Inc.
                         Master Servicing Payment Clearing Account
          Account Number: 666-611059
          Beneficiary: Aurora Loan Services Inc.
          For further credit to: SASCO 2001-16H

     Section 4.02 Statements to Master Servicer.

                                       25
<PAGE>

     Not later than the tenth calendar day of each month, the Servicer shall
furnish to the Master Servicer (a) a monthly remittance advice containing such
information in the form of FNMA Form 2010 or such other form as shall be
required by the FNMA Guides or by the Master Servicer as to the accompanying
remittance and the period ending on the last day of the preceding Determination
Date and (b) all such information required pursuant to clause (a) above on a
magnetic tape or other similar media reasonably acceptable to the Master
Servicer.

     In addition, not more than 60 days after the end of each calendar year,
commencing December 31, 2001, the Servicer shall furnish to each Person who was
an owner of the Mortgage Loans at any time during such calendar year as required
by applicable law or if not required by applicable law, at the request of such
owner as to the aggregate of remittances for the applicable portion of such
year.

     Such obligation of the Servicer shall be deemed to have been satisfied to
the extent that substantially comparable information shall be provided by the
Servicer pursuant to any requirements of the Internal Revenue Code as from time
to time are in force.

     Beginning with calendar year 2001, the Servicer shall prepare and file any
and all tax returns, information statements or other filings for the portion of
the tax year 2001 and the portion of subsequent tax years for which the Servicer
has serviced some or all of the Mortgage Loans hereunder as such returns,
information statements or other filings are required to be delivered to any
governmental taxing authority or to the Master Servicer pursuant to any
applicable law with respect to the Mortgage Loans and the transactions
contemplated hereby. In addition, the Servicer shall provide the Master Servicer
with such information concerning the Mortgage Loans as is necessary for the
Master Servicer to prepare the Trust Fund's federal income tax return as the
Master Servicer may reasonably request from time to time.

     Section 4.03 Monthly Advances by Servicer.

     The Servicer shall make Monthly Advances through the Remittance Date
immediately preceding the distribution of all Liquidation Proceeds and other
payments or recoveries (including Insurance Proceeds and Condemnation Proceeds)
with respect to the related Mortgage Loans.

                                       26
<PAGE>

                                   ARTICLE V.

                          GENERAL SERVICING PROCEDURES

     Section 5.01 Servicing Compensation.

     As consideration for servicing the Mortgage Loans subject to this
Agreement, the Servicer shall retain (a) the relevant Servicing Fee for each
Mortgage Loan remaining subject to this Agreement during any month and (b)
Ancillary Income. In addition, if at any time the Servicer is the Retained
Interest Holder with respect to any Mortgage Loans, then the Servicer, as the
Retained Interest Holder, shall retain an amount equal to the Retained Interest
relating to such Mortgage Loans; provided, that (i) the Trustee shall have no
obligation to make payment of the Retained Interest to the Servicer and (ii) the
Servicer's right to retain the Retained Interest is limited to (and the Retained
Interest may only be retained from) the interest portion (including recoveries
with respect to interest from Liquidation Proceeds to the extent permitted by
Section 3.02 of this Agreement) of the Monthly Payments collected by the
Servicer with respect to those Mortgage Loans for which payment is in fact made
of the entire amount of the Monthly Payment. The Servicing Fee shall be payable
monthly. The Servicing Fees shall be payable only at the time of and with
respect to those Mortgage Loans for which payment is in fact made of the entire
amount of the Monthly Payment or as otherwise provided in Section 3.04. The
obligation of the Trustee to pay the Servicing Fees is limited as provided in
Section 3.04. The aggregate of the Servicing Fees payable to the Servicer for
any month with respect to the Mortgage Loans shall be reduced by any Prepayment
Interest Shortfall Amount with respect to such month.

     The Servicer shall be required to pay all expenses incurred by it in
connection with its servicing activities hereunder and shall not be entitled to
reimbursement thereof except as specifically provided for herein.

     Section 5.02 Annual Audit Report.

     On or before April 30 of each year, beginning with April 30, 2002, Servicer
shall, at its own expense, cause a firm of independent public accountants (who
may also render other services to Servicer), which is a member of the American
Institute of Certified Public Accountants, to furnish to the Seller and Master
Servicer (i) year-end audited (if available) financial statements of the
Servicer and (ii) a statement to the effect that such firm has examined certain
documents and records for the preceding fiscal year (or during the period from
the date of commencement of such servicer's duties hereunder until the end of
such preceding fiscal year in the case of the first such certificate) and that,
on the basis of such examination conducted substantially in compliance with the
Uniform Single Attestation Program for Mortgage Bankers, such firm is of the
opinion that Servicer's overall servicing operations have been conducted in
compliance with the Uniform Single Attestation Program for Mortgage Bankers
except for such exceptions that, in the opinion of such firm, the Uniform Single
Attestation Program for Mortgage Bankers requires it to report, in which case
such exceptions shall be set forth in such statement.

                                       27
<PAGE>

     Section 5.03 Annual Officer's Certificate.

     On or before April 30 of each year, beginning with April 30, 2002, the
Servicer, at its own expense, will deliver to the Seller and Master Servicer a
Servicing Officer's certificate stating, as to each signer thereof, that (i) a
review of the activities of the Servicer during such preceding fiscal year and
of performance under this Agreement has been made under such officers'
supervision, and (ii) to the best of such officers' knowledge, based on such
review, the Servicer has fulfilled all its obligations under this Agreement for
such year, or, if there has been a default in the fulfillment of all such
obligations, specifying each such default known to such officers and the nature
and status thereof including the steps being taken by the Servicer to remedy
such default.

     Section 5.04 Transfers of Mortgaged Property.

     The Servicer shall use its best efforts to enforce any "due-on-sale"
provision contained in any Mortgage or Mortgage Note and to deny assumption by
the person to whom the Mortgaged Property has been or is about to be sold
whether by absolute conveyance or by contract of sale, and whether or not the
Mortgagor remains liable on the Mortgage and the Mortgage Note; provided that,
if in the Servicer's prudent business judgment, it determines that an assumption
of the Mortgage Loan is in the best interests of the Trust Fund, it shall
deliver notice of such determination to the Master Servicer and may permit such
assumption if approved by the Master Servicer. When the Mortgaged Property has
been conveyed by the Mortgagor, the Servicer shall, to the extent it has
knowledge of such conveyance, so long as the Master Servicer has not consented
to an assumption in accordance with the preceding sentence, exercise its rights
to accelerate the maturity of such Mortgage Loan under the "due-on-sale" clause
applicable thereto, provided, however, that the Servicer shall not be required
to take such action if the Servicer, in its prudent business judgment, believes
it is not in the best interests of the Trust Fund and shall not exercise such
rights if prohibited by law from doing so or if the exercise of such rights
would impair or threaten to impair any recovery under the related PMI Policy or
LPMI Policy, if any.

     If the Servicer reasonably believes it is unable under applicable law to
enforce such "due-on-sale" clause or if the Master Servicer approves such
assumption pursuant to the preceding paragraph, the Servicer shall enter into
(i) an assumption and modification agreement with the person to whom such
property has been conveyed, pursuant to which such person becomes liable under
the Mortgage Note and the original Mortgagor remains liable thereon or (ii) in
the event the Servicer is unable under applicable law to require that the
original Mortgagor remain liable under the Mortgage Note and the Servicer has
the prior consent of the primary mortgage guaranty insurer, a substitution of
liability agreement with the owner of the Mortgaged Property pursuant to which
the original Mortgagor is released from liability and the owner of the Mortgaged
Property is substituted as Mortgagor and becomes liable under the Mortgage Note;
provided that no such substitutions should be permitted unless such person
satisfies the underwriting criteria of the Servicer and has a credit risk rating
at least equal to that of the original Mortgagor. The Mortgage Loan, as assumed,
shall conform in all respects to the requirements, representations and
warranties of this Agreement. The Servicer shall notify the Master Servicer that
any such assumption or substitution agreement has been contemplated by
forwarding to the Master Servicer a copy of such assumption or substitution
agreement (indicating the Mortgage File to which it relates). The Servicer shall
forward an original copy of

                                       28
<PAGE>

such agreement to the Custodian to be held by the Custodian with the other
documents related to such Mortgage Loan. The Servicer shall be responsible for
recording any such assumption or substitution agreements. In connection with any
such assumption or substitution agreement, the Monthly Payment on the related
Mortgage Loan shall not be changed but shall remain as in effect immediately
prior to the assumption or substitution, the Mortgage Interest Rate, the stated
maturity or the outstanding principal amount of such Mortgage Loan shall not be
changed nor shall any required monthly payments of principal or interest be
deferred or forgiven. Any assumption fee collected by the Servicer for entering
into an assumption agreement shall be retained by the Servicer as additional
servicing compensation. In connection with any such assumption, neither the
Mortgage Interest Rate borne by the related Mortgage Note, the term of the
Mortgage Loan nor the outstanding principal amount of the Mortgage Loan shall be
changed.

                                   ARTICLE VI.

                           REPRESENTATIONS, WARRANTIES
                                 AND AGREEMENTS

     Section 6.01 Representations, Warranties and Agreements of the Servicer.

     The Servicer, as a condition to the consummation of the transactions
contemplated hereby, hereby makes the following representations and warranties
to the Seller as of the Closing Date:

     (a) Due Organization and Authority. The Servicer is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and has all licenses necessary to carry on its business as now being
conducted and is licensed, qualified and in good standing in each state where a
Mortgaged Property is located if the laws of such state require licensing or
qualification in order to conduct business of the type conducted by the
Servicer, and in any event the Servicer is in compliance with the laws of any
such state to the extent necessary to ensure the enforceability of the terms of
this Agreement; the Servicer has the full power and authority to execute and
deliver this Agreement and to perform in accordance herewith; the execution,
delivery and performance of this Agreement (including all instruments of
transfer to be delivered pursuant to this Agreement) by the Servicer and the
consummation of the transactions contemplated hereby have been duly and validly
authorized; this Agreement evidences the valid, binding and enforceable
obligation of the Servicer and all requisite action has been taken by the
Servicer to make this Agreement valid and binding upon the Servicer in
accordance with its terms;

     (b) Ordinary Course of Business. The consummation of the transactions
contemplated by this Agreement are in the ordinary course of business of the
Servicer;

     (c) No Conflicts. Neither the execution and delivery of this Agreement, the
acquisition of the servicing responsibilities by the Servicer or the
transactions contemplated hereby, nor the fulfillment of or compliance with the
terms and conditions of this Agreement, will conflict with or result in a breach
of any of the terms, conditions or provisions of the Servicer's organizational
documents or any legal restriction or any agreement or instrument to which the
Servicer is now a party or by which it is bound, or constitute a default or
result in an

                                       29
<PAGE>

acceleration under any of the foregoing, or result in the violation of any law,
rule, regulation, order, judgment or decree to which the Servicer or its
property is subject, or impair the ability of the Servicer to service the
Mortgage Loans, or impair the value of the Mortgage Loans;

     (d) Ability to Perform. The Servicer does not believe, nor does it have any
reason or cause to believe, that it cannot perform each and every covenant
contained in this Agreement;

     (e) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or threatened against the Servicer which, either in any
one instance or in the aggregate, may result in any material adverse change in
the business, operations, financial condition, properties or assets of the
Servicer, or in any material impairment of the right or ability of the Servicer
to carry on its business substantially as now conducted, or in any material
liability on the part of the Servicer, or which would draw into question the
validity of this Agreement or of any action taken or to be taken in connection
with the obligations of the Servicer contemplated herein, or which would be
likely to impair materially the ability of the Servicer to perform under the
terms of this Agreement;

     (f) No Consent Required. No consent, approval, authorization or order of
any court or governmental agency or body is required for the execution, delivery
and performance by the Servicer of or compliance by the Servicer with this
Agreement;

     (g) Ability to Service. The Servicer is an FHA Approved Mortgagee, a VA
Approved Lender and an approved seller/servicer of conventional residential
mortgage loans for FNMA, FHLMC or GNMA, with the facilities, procedures, and
experienced personnel necessary for the sound servicing of mortgage loans of the
same type as the Mortgage Loans. The Servicer is in good standing to service
mortgage loans for the FHA and the VA and either FNMA, FHLMC or GNMA. The
Servicer is a member in good standing of the MERS system;

     (h) No Untrue Information. Neither this Agreement nor any statement, report
or other document furnished or to be furnished pursuant to this Agreement or in
connection with the transactions contemplated hereby contains any untrue
statement of fact or omits to state a fact necessary to make the statements
contained therein not misleading; and

     (i) No Commissions to Third Parties. The Servicer has not dealt with any
broker or agent or anyone else who might be entitled to a fee or commission in
connection with this transaction other than the Seller.

     Section 6.02 Remedies for Breach of Representations and Warranties of the
Servicer.

     It is understood and agreed that the representations and warranties set
forth in Section 6.01 shall survive the engagement of the Servicer to perform
the servicing responsibilities as of the Closing Date or Servicing Transfer
Date, as applicable, hereunder and the delivery of the Servicing Files to the
Servicer and shall inure to the benefit of the Seller and the Trustee. Upon
discovery by either the Servicer, the Master Servicer or the Seller of a breach
of any of the foregoing representations and warranties which materially and
adversely affects the ability of the Servicer to perform its duties and
obligations under this Agreement or otherwise materially and adversely affects
the value of the Mortgage Loans, the Mortgaged Property or the priority of the

                                       30
<PAGE>

security interest on such Mortgaged Property or the interest of the Seller or
the Trustee, the party discovering such breach shall give prompt written notice
to the other.

     Within 60 days of the earlier of either discovery by or notice to the
Servicer of any breach of a representation or warranty set forth in Section 6.01
which materially and adversely affects the ability of the Servicer to perform
its duties and obligations under this Agreement or otherwise materially and
adversely affects the value of the Mortgage Loans, the Mortgaged Property or the
priority of the security interest on such Mortgaged Property, the Servicer shall
use its Best Efforts promptly to cure such breach in all material respects and,
if such breach cannot be cured, the Servicer shall, at the Trustee's or the
Master Servicer's option, assign the Servicer's rights and obligations under
this Agreement (or respecting the affected Mortgage Loans) to a successor
Servicer. Such assignment shall be made in accordance with Sections 9.01 and
9.02.

     In addition, the Servicer shall indemnify the Seller and the Master
Servicer and hold each of them harmless against any Costs resulting from any
claim, demand, defense or assertion based on or grounded upon, or resulting
from, a breach of the Servicer representations and warranties contained in this
Agreement. It is understood and agreed that the remedies set forth in this
Section 6.02 constitute the sole remedies of the Master Servicer and the Trustee
respecting a breach of the foregoing representations and warranties.

     Any cause of action against the Servicer relating to or arising out of the
breach of any representations and warranties made in Section 6.01 shall accrue
upon (i) discovery of such breach by the Servicer or notice thereof by the
Seller or Master Servicer to the Servicer, (ii) failure by the Servicer to cure
such breach within the applicable cure period, and (iii) demand upon the
Servicer by the Seller or the Master Servicer for compliance with this
Agreement.

     Section 6.03 Additional Indemnification by the Servicer; Third Party
Claims.

     The Servicer shall indemnify the Seller, the Master Servicer and the Trust
Fund and hold them harmless against any and all Costs that the indemnified party
may sustain in any way related to (i) the failure of the Servicer to perform its
duties and service the Mortgage Loans in material compliance with the terms of
this Agreement or (ii) the failure of the Servicer to cause any event to occur
which requires its "Best Efforts" under this Agreement. The Servicer shall
immediately notify the Seller, the Master Servicer, the Trustee, or any other
relevant party if a claim is made by a third party with respect to this
Agreement or the Mortgage Loans, assume (with the prior written consent of the
indemnified party) the defense of any such claim and pay all expenses in
connection therewith, including counsel fees, promptly pay, discharge and
satisfy any judgment or decree which may be entered against it or any
indemnified party in respect of such claim and follow any written instructions
received from such indemnified party in connection with such claim. Each
indemnified party, as applicable, promptly shall reimburse the Servicer for all
amounts advanced by it pursuant to the preceding sentence except when the claim
is in any way related to the Servicer's indemnification pursuant to Section
6.02, or the failure of the Servicer to service and administer the Mortgage
Loans in material compliance with the terms of this Agreement. In the event a
dispute arises between an indemnified party and the Servicer with respect to any
of the rights and obligations of the parties pursuant to this Agreement, and
such dispute is adjudicated in a court of law, by an arbitration panel or any
other

                                       31
<PAGE>

judicial process, then the losing party shall indemnify and reimburse the
winning party for all attorney's fees and other costs and expenses related to
the adjudication of said dispute.

                                  ARTICLE VII.

                                  THE SERVICER

     Section 7.01 Merger or Consolidation of the Servicer.

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

     Any Person into which the Servicer may be merged or consolidated, or any
corporation resulting from any merger, conversion or consolidation to which the
Servicer shall be a party, or any Person succeeding to the business of the
Servicer, shall be the successor of the Servicer hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding, provided,
however, that the successor or surviving Person shall be an institution (i)
having a net worth of not less than $25,000,000, and (ii) which is a FNMA-,
FHLMC-, and GNMA-approved servicer in good standing and an FHA approved
Mortgagee and a VA Approved Lender.

     Section 7.02 Limitation on Liability of the Servicer and Others.

     Neither the Servicer nor any of the directors, officers, employees or
agents of the Servicer shall be under any liability to the Seller, the Master
Servicer or the Trustee for any action taken or for refraining from the taking
of any action in good faith pursuant to this Agreement, or for errors in
judgment; provided, however, that this provision shall not protect the Servicer
or any such person against any breach of warranties or representations made
herein, or failure to perform its obligations in strict compliance with any
standard of care set forth in this Agreement, or any liability which would
otherwise be imposed by reason of any breach of the terms and conditions of this
Agreement. The Servicer and any director, officer, employee or agent of the
Servicer may rely in good faith on any document of any kind prima facie properly
executed and submitted by any Person respecting any matters arising hereunder.
The Servicer shall not be under any obligation to appear in, prosecute or defend
any legal action which is not incidental to its duties to service the Mortgage
Loans in accordance with this Agreement and which in its opinion may involve it
in any expense or liability, provided, however, that the Servicer may, with the
consent of the Master Servicer, undertake any such action which it may deem
necessary or desirable in respect of this Agreement and the rights and duties of
the parties hereto. In such event, the Servicer shall be entitled to
reimbursement from the Trust Fund for the reasonable legal expenses and costs of
such action.

     Section 7.03 Limitation on Resignation and Assignment by the Servicer.

     The Seller has entered into this Agreement with the Servicer in reliance
upon the independent status of the Servicer, and the representations as to the
adequacy of its servicing

                                       32
<PAGE>

facilities, plant, personnel, records and procedures, its integrity, reputation
and financial standing, and the continuance thereof. Therefore, the Servicer
shall neither assign its rights under this Agreement or the servicing hereunder
nor delegate its duties hereunder or any portion thereof, or sell or otherwise
dispose of all or substantially all of its property or assets without, in each
case, the prior written consent of the Seller and the Master Servicer, which
consent, in the case of an assignment of rights or delegation of duties, shall
be granted or withheld in the discretion of the Seller and the Master Servicer,
and which consent, in the case of a sale or disposition of all or substantially
all of the property or assets of the Servicer, shall not be unreasonably
withheld; provided, that in each case, there must be delivered to the Master
Servicer and the Trustee a letter from each Rating Agency to the effect that
such transfer of servicing or sale or disposition of assets will not result in a
qualification, withdrawal or downgrade of the then-current rating of any of the
Certificates. Notwithstanding the foregoing, the Servicer, without the consent
of the Seller, the Master Servicer or the Trustee, may retain third party
contractors to perform certain servicing and loan administration functions,
including without limitation, hazard insurance administration, tax payment and
administration, flood certification and administration, collection services and
similar functions; provided, that the retention of such contractors by Servicer
shall not limit the obligation of the Servicer to service the Mortgage Loans
pursuant to the terms and conditions of this Agreement.

     The Servicer shall not resign from the obligations and duties hereby
imposed on it except by mutual consent of the Servicer and the Master Servicer
or upon the determination that its duties hereunder are no longer permissible
under applicable law and such incapacity cannot be cured by the Servicer. Any
such determination permitting the resignation of the Servicer shall be evidenced
by an Opinion of Counsel to such effect delivered to the Master Servicer and the
Trustee which Opinion of Counsel shall be in form and substance acceptable to
the Master Servicer and the Trustee. No such resignation shall become effective
until a successor shall have assumed the Servicer's responsibilities and
obligations hereunder in the manner provided in Section 9.01.

     Without in any way limiting the generality of this Section 7.03, in the
event that the Servicer either shall assign this Agreement or the servicing
responsibilities hereunder or delegate its duties hereunder or any portion
thereof or sell or otherwise dispose of all or substantially all of its property
or assets, without the prior written consent of the Seller and the Master
Servicer, then the Seller or the Master Servicer shall have the right to
terminate this Agreement upon notice given as set forth in Section 8.01, without
any payment of any penalty or damages and without any liability whatsoever to
the Servicer or any third party.

                                  ARTICLE VIII.

                                   TERMINATION

     Section 8.01 Termination for Cause.

     This Agreement shall be terminable at the option of the Seller or the
Master Servicer if any of the following events of default exist on the part of
the Servicer:

                                       33
<PAGE>

         (i) any failure by the Servicer to remit to the Master Servicer any
payment required to be made under the terms of this Agreement which continues
unremedied for a period of two Business Days after the date upon which written
notice of such failure, requiring the same to be remedied, shall have been given
to the Servicer by the Master Servicer; or

         (ii) failure by the Servicer duly to observe or perform in any material
respect any other of the covenants or agreements on the part of the Servicer set
forth in this Agreement which continues unremedied for a period of 30 days; or

         (iii) failure by the Servicer to maintain its license to do business or
service residential mortgage loans in any jurisdiction, if required by such
jurisdiction, where the Mortgaged Properties are located; or

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

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

         (vi) the Servicer shall admit in writing its inability to pay its debts
generally as they become due, file a petition to take advantage of any
applicable insolvency, bankruptcy or reorganization statute, make an assignment
for the benefit of its creditors, voluntarily suspend payment of its obligations
or cease its normal business operations for three Business Days; or

         (vii) the Servicer ceases to meet the qualifications of a FNMA, FHLMC
or GNMA lender/servicer or ceases to be an FHA Approved Mortgagee or ceases to
be a VA Approved Lender; or

         (viii) the Servicer attempts to assign the servicing of the Mortgage
Loans or its right to servicing compensation hereunder or the Servicer attempts
to sell or otherwise dispose of all or substantially all of its property or
assets or to assign this Agreement or the servicing responsibilities hereunder
or to delegate its duties hereunder or any portion thereof, in each case without
complying fully with the provisions of Section 7.03.

     In each and every such case, so long as an event of default shall not have
been remedied, in addition to whatever rights the Seller or the Master Servicer
may have at law or equity to damages, including injunctive relief and specific
performance, the Seller or the Master Servicer, by notice in writing to the
Servicer, may terminate all the rights and obligations of the Servicer under
this Agreement and in and to the servicing contract established hereby and the
proceeds thereof.

                                       34
<PAGE>

     Upon receipt by the Servicer of such written notice, all authority and
power of the Servicer under this Agreement, whether with respect to the Mortgage
Loans or otherwise, shall pass to and be vested in a successor Servicer
appointed by the Seller and the Master Servicer. Upon written request from the
Seller, the Servicer shall prepare, execute and deliver to the successor entity
designated by the Seller any and all documents and other instruments, place in
such successor's possession all Servicing Files, and do or cause to be done all
other acts or things necessary or appropriate to effect the purposes of such
notice of termination, including but not limited to the transfer and endorsement
or assignment of the Mortgage Loans and related documents, at the Servicer's
sole expense. The Servicer shall cooperate with the Seller and the Master
Servicer and such successor in effecting the termination of the Servicer's
responsibilities and rights hereunder, including without limitation, the
transfer to such successor for administration by it of all cash amounts which
shall at the time be credited by the Servicer to the Custodial Account or Escrow
Account or thereafter received with respect to the Mortgage Loans.

     By a written notice, the Seller and the Master Servicer may waive any
default by the Servicer in the performance of its obligations hereunder and its
consequences. Upon any waiver of a past default, such default shall cease to
exist, and any Event of Default arising therefrom shall be deemed to have been
remedied for every purpose of this Agreement. No such waiver shall extend to any
subsequent or other default or impair any right consequent thereon except to the
extent expressly so waived.

     Section 8.02 Termination Without Cause.

     This Agreement shall terminate upon: (i) the later of (a) the distribution
of the final payment or liquidation proceeds on the last Mortgage Loan to the
Master Servicer (or advances by the Servicer for the same), and (b) the
disposition of all REO Property acquired upon foreclosure of the last Mortgage
Loan and the remittance of all funds due hereunder, (ii) mutual consent of the
Servicer, Seller and the Master Servicer in writing or (iii) at the sole
discretion of the Seller (acting in its capacity as owner of the servicing
rights relating to the Mortgage Loans). Any such termination pursuant to clause
(iii) above shall be with 30 days' prior notice, in writing and delivered to the
Trustee, the Master Servicer and the Servicer by registered mail to the
addresses set forth in Section 9.03 of this Agreement (in the case of the
Servicer) or in the Trust Agreement (in the case of the Trustee or the Master
Servicer). The Servicer shall comply with the termination procedures set forth
in Sections 7.03, 8.01 and 9.01 hereof. The Master Servicer or the Trustee shall
have no right to terminate the Servicer pursuant to this Section 8.02. In
connection with a termination by the Seller pursuant to clause (iii) of this
Section 8.02, the Servicer will be reimbursed from the Trust Fund, to the extent
provided in the Trust Agreement, for all unreimbursed out-of-pocket Servicing
Advances, Monthly Advances and Servicing Fees at the time of such transfer of
servicing.

                                       35
<PAGE>

                                   ARTICLE IX.

                            MISCELLANEOUS PROVISIONS

     Section 9.01 Successor to the Servicer.

     Simultaneously with the termination of the Servicer's responsibilities and
duties under this Agreement (a) pursuant to Sections 6.02, 7.03, 8.01 or
8.02(ii), the Master Servicer shall (i) succeed to and assume all of the
Servicer's responsibilities, rights, duties and obligations under this
Agreement, or (ii) appoint a successor having the characteristics set forth in
clauses (i) and (ii) of Section 7.01 and which shall succeed to all rights and
assume all of the responsibilities, duties and liabilities of the Servicer under
this Agreement simultaneously with the termination of the Servicer's
responsibilities, duties and liabilities under this Agreement; or (b) pursuant
to a termination under Section 8.02(iii), the Seller shall appoint a successor
having the characteristics set forth in clauses (i) and (ii) of Section 7.01 and
which shall succeed to all rights and assume all of the responsibilities, duties
and liabilities of the Servicer under this Agreement simultaneously with the
termination of the Servicer's responsibilities, duties and liabilities under
this Agreement. Any successor to the Servicer shall be subject to the approval
of the Master Servicer and, to the extent required by the Trust Agreement, the
Trustee, shall be a member in good standing of the MERS system (if any of the
Mortgage Loans are MERS Eligible Mortgage Loans, unless such Mortgage Loans are
withdrawn from MERS and Assignments of Mortgage are recorded in favor of the
Trustee at the expense of the successor Servicer) and shall be an FHA Approved
Mortgagee and a VA Approved Lender. Any approval of a successor servicer by the
Master Servicer and, to the extent required by the Trust Agreement, the Trustee,
shall, if the successor servicer is not at that time a servicer of other
Mortgage Loans for the Trust Fund, be conditioned upon the receipt by the Master
Servicer and the Trustee of a letter from each Rating Agency to the effect that
such transfer of servicing will not result in a qualification, withdrawal or
downgrade of the then-current rating of any of the Certificates. In addition,
with respect to any FHA Loans serviced hereunder, the Servicer shall provide
notice of such change in servicers to HUD on HUD form 92080 or such other form
as prescribed by HUD, within 10 days after such transfer of servicing. In
connection with such appointment and assumption, the Master Servicer or the
Seller, as applicable, may make such arrangements for the compensation of such
successor out of payments on Mortgage Loans as it and such successor shall
agree, provided, however, that no such compensation shall be in excess of that
permitted the Servicer under this Agreement. In the event that the Servicer's
duties, responsibilities and liabilities under this Agreement should be
terminated pursuant to the aforementioned sections, the Servicer shall discharge
such duties and responsibilities during the period from the date it acquires
knowledge of such termination until the effective date thereof with the same
degree of diligence and prudence which it is obligated to exercise under this
Agreement, and shall take no action whatsoever that might impair or prejudice
the rights or financial condition of its successor. The resignation or removal
of the Servicer pursuant to the aforementioned sections shall not become
effective until a successor shall be appointed pursuant to this Section 9.01 and
shall in no event relieve the Servicer of the representations and warranties
made pursuant to Sections 6.01 and the remedies available to the Master Servicer
and the Seller under Section 6.02 and 6.03, it being understood and agreed that
the provisions of such Sections 6.01, 6.02 and 6.03 shall be applicable to the
Servicer notwithstanding any such resignation or termination of the Servicer, or
the termination of this Agreement.

                                       36
<PAGE>

     Within a reasonable period of time, but in no event longer than 30 days of
the appointment of a successor entity, the Servicer shall prepare, execute and
deliver to the successor entity any and all documents and other instruments,
place in such successor's possession all Servicing Files, and do or cause to be
done all other acts or things necessary or appropriate to effect the purposes of
such notice of termination, including but not limited to the transfer and
endorsement of the Mortgage Notes and related documents, and the preparation and
recordation of Assignments of Mortgage. The Servicer shall cooperate with the
Trustee, the Master Servicer or the Seller, as applicable, and such successor in
effecting the termination of the Servicer's responsibilities and rights
hereunder and the transfer of servicing responsibilities to the successor
Servicer, including without limitation, the transfer to such successor for
administration by it of all cash amounts which shall at the time be credited by
the Servicer to the Custodial Account or Escrow Account or thereafter received
with respect to the Mortgage Loans.

     Any successor appointed as provided herein shall execute, acknowledge and
deliver to the Trustee, the Servicer, the Master Servicer and the Seller an
instrument (i) accepting such appointment, wherein the successor shall make the
representations and warranties set forth in Section 6.01 (including a
representation that the successor Servicer is a member of MERS, unless none of
the Mortgage Loans are MERS Mortgage Loans or MERS Eligible Mortgage Loans or
any such Mortgage Loans have been withdrawn from MERS and Assignments of
Mortgage are recorded in favor of the Trustee) and (ii) an assumption of the due
and punctual performance and observance of each covenant and condition to be
performed and observed by the Servicer under this Agreement, whereupon such
successor shall become fully vested with all the rights, powers, duties,
responsibilities, obligations and liabilities of the Servicer, with like effect
as if originally named as a party to this Agreement. Any termination or
resignation of the Servicer or termination of this Agreement pursuant to
Sections 6.02, 7.03, 8.01 or 8.02 shall not affect any claims that the Master
Servicer or the Trustee may have against the Servicer arising out of the
Servicer's actions or failure to act prior to any such termination or
resignation. In addition, in the event any successor Servicer is appointed
pursuant to Section 8.02(iii) of this Agreement, such successor Servicer must
satisfy the conditions relating to the transfer of servicing set forth in the
Trust Agreement.

     The Servicer shall deliver promptly to the successor Servicer the funds in
the Custodial Account and Escrow Account and all Mortgage Loan documents and
related documents and statements held by it hereunder and the Servicer shall
account for all funds and shall execute and deliver such instruments and do such
other things as may reasonably be required to more fully and definitively vest
in the successor all such rights, powers, duties, responsibilities, obligations
and liabilities of the Servicer.

     Upon a successor's acceptance of appointment as such, the Servicer shall
notify the Trustee, the Seller and Master Servicer of such appointment in
accordance with the procedures set forth in Section 9.03.

     Section 9.02 Costs.

     The Seller shall pay any legal fees and expenses of its attorneys. Costs
and expenses incurred in connection with the transfer of the servicing
responsibilities, including fees for delivering Servicing Files, shall be paid
by the Seller. Subject to Sections 2.02 and 3.01(a), the

                                       37
<PAGE>

Depositor shall pay the costs associated with the preparation, delivery and
recording of Assignments of Mortgages.

     Section 9.03 Notices.

     All demands, notices and communications hereunder shall be in writing and
shall be deemed to have been duly given if sent by facsimile or mailed by
overnight courier, addressed as follows (or such other address as may hereafter
be furnished to the other party by like notice):

         (i)      if to the Seller:

                  Lehman Capital, A Division of
                  Lehman Brothers Holdings Inc.
                  101 Hudson Street
                  Jersey City, New Jersey 07302
                  Attention: Manager, Contract Finance
                  Telephone No.:  (201) 524-2000

         (ii)     if to the Servicer:

                  Aurora Loan Services Inc.
                  2530 South Parker Road
                  Suite 601
                  Aurora, Colorado  80014
                  Attention:  Rick Skogg
                  Telephone No.:  (303) 632-3000
                  Telecopier No.:  (303) 632-3001

                  with a copy to:

                  Aurora Loan Services Inc.
                  601 Fifth Avenue
                  P.O. Box 1706
                  Scottsbluff, Nebraska  69361
                  Attention:  Manager, Loan Administration
                  Telephone No.:  (308) 635-3500
                  Telecopier No.:  (308) 632-4287

         (iii)    if to the Master Servicer:

                  Aurora Loan Services Inc.
                  2530 South Parker Road
                  Suite 601
                  Aurora, Colorado 80014
                  Attention:  E. Todd Whittemore
                  Telephone:  (303) 632-3422
                  Telecopier:  (303) 632-3123

                                       38
<PAGE>

         (iv)     if to the Trustee:

                  U.S. Bank National Association
                  180 East Fifth Street, SPFT0210
                  St. Paul, Minnesota 55101
                  Corporate Trust (SASCO 2001-16H)
                  Attention:  Sheryl Christopherson
                  Telephone:  (651) 244-0739
                  Facsimile:   (651) 244-0089

     Any such demand, notice or communication hereunder shall be deemed to have
been received on the date delivered to or received at the premises of the
addressee.

     Section 9.04 Severability Clause.

     Any part, provision, representation or warranty of this Agreement which is
prohibited or which is held to be void or unenforceable shall be ineffective to
the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof. Any part, provision, representation or warranty of
this Agreement which is prohibited or unenforceable or is held to be void or
unenforceable in any jurisdiction shall be ineffective, as to such jurisdiction,
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction as to any Mortgage Loan shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent permitted
by applicable law, the parties hereto waive any provision of law which prohibits
or renders void or unenforceable any provision hereof. If the invalidity of any
part, provision, representation or warranty of this Agreement shall deprive any
party of the economic benefit intended to be conferred by this Agreement, the
parties shall negotiate, in good-faith, to develop a structure the economic
effect of which is as close as possible to the economic effect of this Agreement
without regard to such invalidity.

     Section 9.05 No Personal Solicitation.

     From and after the Closing Date, the Servicer hereby agrees that it will
not take any action or permit or cause any action to be taken by any of its
agents or affiliates, or by any independent contractors on the Servicer's
behalf, to personally, by telephone or mail, solicit the borrower or obligor
under any Mortgage Loan (on a targeted basis) for any purposes of prepayment,
refinancing or modification of the related Mortgage Loan, provided, however,
that this limitation shall not prohibit Servicer from soliciting such Mortgagor
for purposes of prepayment, refinance or modification of any loan owned or
serviced by Servicer other than a Mortgage Loan. It is understood and agreed
that, among other marketing activities, promotions undertaken by Servicer which
are directed of the general public at large or which are directed generally to a
segment of the then existing customers of Servicer or any of its direct or
indirect subsidiaries (including, without limitation, the mailing of promotional
materials to Servicer's deposit customers by inserting such materials into
customer account statements, mass mailings based on commercially acquired
mailing lists and newspaper, radio and television advertisements) shall not
constitute solicitation under this section. In the event the Servicer does

                                       39
<PAGE>

refinance any Mortgage Loan as a result of a violation of the requirements set
forth in this Section 9.05, Servicer hereby agrees to pay to the Trust Fund an
amount equal to the difference, if any, between the amount that the Trust Fund
would have received if it had sold the Mortgage Loan to a third party, and the
proceeds received by the Trust Fund as a result of such refinancing.

     Section 9.06 Counterparts.

     This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original, and all such
counterparts shall constitute one and the same instrument.

     Section 9.07 Place of Delivery and Governing Law.

     This Agreement shall be deemed in effect when a fully executed counterpart
thereof is received by the Seller in the State of New York and shall be deemed
to have been made in the State of New York. THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, NOTWITHSTANDING NEW YORK OR
OTHER CHOICE OF LAW RULES TO THE CONTRARY.

     Section 9.08 Further Agreements.

     The Seller and the Servicer each agree to execute and deliver to the other
such reasonable and appropriate additional documents, instruments or agreements
as may be necessary or appropriate to effectuate the purposes of this Agreement.

     Section 9.09 Intention of the Parties.

     It is the intention of the parties that the Seller is conveying, and the
Servicer is receiving only a contract for servicing the Mortgage Loans.
Accordingly, the parties hereby acknowledge that the Trust Fund remains the sole
and absolute owner of the Mortgage Loans and all rights (other than the
servicing rights) related thereto.

     Section 9.10 Successors and Assigns; Assignment of Servicing Agreement.

     This Agreement shall bind and inure to the benefit of and be enforceable by
the Servicer, the Seller, the Trustee and the Master Servicer and their
respective successors and assigns. This Agreement shall not be assigned, pledged
or hypothecated by the Servicer to a third party except in accordance with
Section 7.03.

     Section 9.11 Assignment by Lehman Capital.

     The Seller shall have the right, upon notice to but without the consent of
the Servicer, to assign, in whole or in part, its interest under this Agreement
to the Depositor, which in turn shall assign such rights to the Trustee, and the
Trustee then shall succeed to all rights of the Seller under this Agreement. All
references to the Seller in this Agreement shall be deemed to include

                                       40
<PAGE>

its assignee or designee and any subsequent assignee or designee, specifically
including the Trustee, except with respect to the Seller's retained servicing
rights pursuant to Section 8.02(iii).

     Section 9.12 [Reserved.]

     Section 9.13 Waivers.

     No term or provision of this Agreement may be waived or modified unless
such waiver or modification is in writing and signed by the party against whom
such waiver or modification is sought to be enforced.

     Section 9.14 Exhibits.

     The exhibits to this Agreement are hereby incorporated and made a part
hereof and are an integral part of this Agreement.

     Section 9.15 General Interpretive Principles.

     For purposes of this Agreement, except as otherwise expressly provided or
unless the context otherwise requires:

     (a) the terms defined in this Agreement have the meanings assigned to them
in this Agreement and include the plural as well as the singular, and the use of
any gender herein shall be deemed to include the other gender;

     (b) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles;

     (c) references herein to "Articles", "Sections", "Subsections",
"Paragraphs", and other subdivisions without reference to a document are to
designated Articles, Sections, Subsections, Paragraphs and other subdivisions of
this Agreement;

     (d) a reference to a Subsection without further reference to a Section is a
reference to such Subsection as contained in the same Section in which the
reference appears, and this rule shall also apply to Paragraphs and other
subdivisions;

     (e) the words "herein", "hereof", "hereunder" and other words of similar
import refer to this Agreement as a whole and not to any particular provision;
and

     (f) the term "include" or "including" shall mean by reason of enumeration.

     Section 9.16 Reproduction of Documents.

     This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications which may hereafter be
executed, (b) documents received by any party at the closing, and (c) financial
statements, certificates and other information previously or hereafter
furnished, may be reproduced by any photographic, photostatic, microfilm,
micro-card, miniature photographic or other similar process. The parties agree
that

                                       41
<PAGE>

any such reproduction shall be admissible in evidence as the original itself in
any judicial or administrative proceeding, whether or not the original is in
existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.

                                       42
<PAGE>

     IN WITNESS WHEREOF, the Servicer, the Seller and the Master Servicer have
caused their names to be signed hereto by their respective officers thereunto
duly authorized as of the date first above written.

                                           LEHMAN CAPITAL, A DIVISION OF
                                             LEHMAN BROTHERS HOLDINGS INC.,
                                             as Seller

                                           By: /s/ Joseph J. Kelly
                                              ----------------------------------
                                              Name:  Joseph J. Kelly
                                              Title: Authorized Signatory

                                           AURORA LOAN SERVICES INC.,
                                             as Servicer

                                           By: /s/ Rick W. Skogg
                                              ----------------------------------
                                              Name:  Rick W. Skogg
                                              Title: President

                                           AURORA LOAN SERVICES INC.,
                                             as Master Servicer

                                           By: /s/ E. Todd Whittemore
                                              ----------------------------------
                                              Name:  E. Todd Whittemore
                                              Title: Exec. Vice President

ACKNOWLEDGED BY:

U.S. BANK NATIONAL ASSOCIATION, as Trustee

By: /s/ S. Christopherson
   ----------------------------------
   Name:  S. Christopherson
   Title: Vice President

<PAGE>

                                    EXHIBIT A

                             MORTGAGE LOAN SCHEDULE

(retained in a separate closing binder entitled "SASCO 2001-16H Mortgage Loan
Schedule" at McKee Nelson LLP)

<PAGE>

                                    EXHIBIT B

                       CUSTODIAL ACCOUNT LETTER AGREEMENT

                                                                _______ __, 20__

To:
     ---------------------------

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

---------------------------
(the "Depository")

     As Servicer under the Servicing Agreement, dated as of October 1, 2001 (the
"Agreement"), we hereby authorize and request you to establish an account, as a
Custodial Account pursuant to Section 3.03 of the Agreement, to be designated as
"Aurora Loan Services Inc., in trust for the Master Servicer for Structured
Asset Securities Corporation 2001-16H." All deposits in the account shall be
subject to withdrawal therefrom by order signed by the Servicer. This letter is
submitted to you in duplicate. Please execute and return one original to us.

                                           AURORA LOAN SERVICES INC.

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

     The undersigned, as Depository, hereby certifies that the above described
account has been established under Account Number __________, at the office of
the Depository indicated above, and agrees to honor withdrawals on such account
as provided above.

                                           -------------------------------------
                                           Depository

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

<PAGE>

                                    EXHIBIT C

                         ESCROW ACCOUNT LETTER AGREEMENT

                                                                _______ __, 20__

To:
     ---------------------------

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

---------------------------
(the "Depository")

     As Servicer under the Servicing Agreement, dated as of October 1, 2001 (the
"Agreement"), we hereby authorize and request you to establish an account, as an
Escrow Account pursuant to Section 3.05 of the Agreement, to be designated as
"Aurora Loan Services Inc., in trust for the Master Servicer for Structured
Asset Securities Corporation 2001-16H." All deposits in the account shall be
subject to withdrawal therefrom by order signed by the Servicer. This letter is
submitted to you in duplicate. Please execute and return one original to us.

                                           AURORA LOAN SERVICES INC.

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

         The undersigned, as Depository, hereby certifies that the above
described account has been established under Account Number __________, at the
office of the Depository indicated above, and agrees to honor withdrawals on
such account as provided above.

                                           -------------------------------------
                                           Depository

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

<PAGE>

                                   SCHEDULE 1

                            SERVICER RECORDATION FEES<PAGE>

                        RECONSTITUTED SERVICING AGREEMENT

         THIS RECONSTITUTED SERVICING AGREEMENT (this "Agreement"), entered into
as of the 1st day of October, 2001, by and between LEHMAN CAPITAL, A DIVISION OF
LEHMAN BROTHERS HOLDINGS INC. ("Lehman Capital"), a Delaware corporation, and
BANK OF AMERICA, N.A. (the "Servicer"), a national banking association, recites
and provides as follows:

                                    RECITALS

         WHEREAS, Lehman Brothers Bank, FSB ("Bank"), an affiliate of Lehman
Capital, acquired certain first lien, fixed rate and adjustable rate,
residential mortgage loans from the Servicer, which mortgage loans were either
originated or acquired by the Servicer.

         WHEREAS, such mortgage loans are currently serviced by the Servicer for
the Bank pursuant to a Mortgage Loan Sale and Servicing Agreement (Loan Package
LBB004) (the "Sale and Servicing Agreement"), dated October 1, 2001 and
annexed as Exhibit B hereto, by and between Bank, as purchaser, and the
Servicer, as seller and servicer.

         WHEREAS, pursuant to the Master Mortgage Loan Purchase and Warranties
Agreement, dated as of February 18, 2000 (the "Master Mortgage Loan Purchase
Agreement"), and annexed as Exhibit C hereto, Lehman Capital has purchased or
received from CCGI all of CCGI's right, title and interest in and to certain of
the mortgage loans currently serviced under the Master Servicing Agreement
(hereinafter, the "Mortgage Loans") and assumed for the benefit of each of the
Servicers and the obligations of CCGI as owner under such Agreement.

         WHEREAS, Lehman Capital has conveyed certain of the Mortgage Loans as
identified on Exhibit D hereto (the "Serviced Mortgage Loans") to Structured
Asset Securities Corporation, a Delaware special purpose corporation ("SASCO"),
which in turn has conveyed the Serviced Mortgage Loans to The Chase Manhattan
Bank (the "Trustee"), pursuant to a trust agreement dated as of October 1, 2001
(the "Trust Agreement"), among the Trustee, Aurora Loan Services Inc., as master
servicer ("Aurora," and, together with any successor Master Servicer appointed
pursuant to the provisions of the Trust Agreement, the "Master Servicer") and
SASCO.

         WHEREAS, Lehman Capital desires that the Servicer continue to service
the Serviced Mortgage Loans, and the Servicer has agreed to do so, subject to
the rights of the Lehman Capital (with the consent of the Trustee) to terminate
the rights and obligations of the Servicer hereunder at any time without cause
and to the other conditions set forth herein.

         WHEREAS, Lehman Capital and the Servicer agree that the provisions of
the Sale and Servicing Agreement shall continue to apply to the Serviced
Mortgage Loans, but only to the extent provided herein and that this Agreement
shall govern the Serviced Mortgage Loans for so long as such Serviced Mortgage
Loans remain subject to the provisions of the Trust Agreement.

         WHEREAS, the Master Servicer and any successor master servicer shall be
obligated, among other things, to supervise the servicing of the Serviced
Mortgage Loans on behalf of the

<PAGE>

Trustee, and shall have the right under the conditions specified herein to
terminate for cause the rights and obligations of the Servicer under this
Agreement.

         WHEREAS, Lehman Capital and the Servicer intend that each of the Master
Servicer and the Trustee is an intended third party beneficiary of this
Agreement.

         NOW, THEREFORE, in consideration of the mutual agreements hereinafter
set forth and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, Lehman Capital and the Servicer
hereby agree as follows:

                                    AGREEMENT

         1. Definitions. Capitalized terms used and not defined in this
Agreement, including Exhibit A hereto and any provisions of the Sale and
Servicing Agreement incorporated by reference herein shall have the meanings
ascribed to such terms in the Trust Agreement.

         2. Custodianship. The parties hereto acknowledge that U.S. Bank
National Association will act as custodian of the Serviced Mortgage Files for
the Trustee pursuant to a Custodial Agreement, dated October 1, 2001, between
U.S. Bank Trust National Association and the Trustee.

         3. Servicing. The Servicer agrees, with respect to the Serviced
Mortgage Loans, to perform and observe the duties, responsibilities and
obligations that are to be performed and observed under the provisions of the
Sale and Servicing Agreement, except as otherwise provided herein and on Exhibit
A hereto, and that the provisions of the Sale and Servicing Agreement, as so
modified, are and shall be a part of this Agreement to the same extent as if set
forth herein in full.

         4. Trust Cut-off Date. The parties hereto acknowledge that by operation
of Subsection 11.05 and Subsection 11.15 of the Sale and Servicing Agreement,
the remittance on [OCTOBER 18], 2001 to the Trust Fund is to include principal
due after October 1, 2001 (the "Trust Cut-off Date") plus interest, at the
Mortgage Loan Remittance Rate collected during the related Due Period exclusive
of any portion thereof allocable to a period prior to the Trust Cut-off Date,
with the adjustments specified in clauses (b), (c) and (d) of Subsection 11.15
of the Sale and Servicing Agreement.

         5. Master Servicing; Termination of Servicer. The Servicer, including
any successor servicer hereunder, shall be subject to the supervision of the
Master Servicer, which Master Servicer shall be obligated to ensure that the
Servicer services the Serviced Mortgage Loans in accordance with the provisions
of this Agreement. The Master Servicer, acting on behalf of the Trustee and the
SASCO 2001-16H Trust Fund (the "Trust Fund") created pursuant to the Trust
Agreement, shall have the same rights as the Bank, as purchaser, under the Sale
and Servicing Agreement to enforce the obligations of the Servicer under the
Sale and Servicing Agreement and the term "Purchaser" as used in the Sale and
Servicing Agreement in connection with any rights of the Purchaser shall refer
to the Trust Fund or, as the context requires, the Master Servicer acting in its
capacity as agent for the Trust Fund, except as otherwise specified in

                                       2
<PAGE>

Exhibit A hereto. The Master Servicer shall be entitled to terminate the rights
and obligations of the Servicer under this Agreement upon the failure of the
Servicer to perform any of its obligations under this Agreement, which failure
results in an Event of Default as provided in Subsection 13.01 of the Sale and
Servicing Agreement. Notwithstanding anything herein to the contrary, in no
event shall the Master Servicer assume any of the obligations of the Bank under
the Sale and Servicing Agreement and in connection with the performance of the
Master Servicer's duties hereunder, the parties and other signatories hereto
agree that the Master Servicer shall be entitled to all of the rights,
protections and limitations of liability afforded to the Master Servicer under
the Trust Agreement.

         6. No Representations. Neither the Servicer nor the Master Servicer
shall be obligated or required to make any representations and warranties
regarding the characteristics of the Serviced Mortgage Loans (other than
representations and warranties made by the Servicer in Subsection 7.01 of the
Sale and Servicing Agreement) in connection with the transactions contemplated
by the Trust Agreement and issuance of the Certificates issued pursuant thereto.

         7. Notices. All notices and communications between or among the parties
hereto (including any third party beneficiary thereof) or required to be
provided to the Trustee shall be in writing and shall be deemed received or
given when mailed first-class mail, postage prepaid, addressed to each other
party at its address specified below or, if sent by facsimile or electronic
mail, when facsimile or electronic confirmation of receipt by the recipient is
received by the sender of such notice. Each party may designate to the other
parties in writing, from time to time, other addresses to which notices and
communications hereunder shall be sent.

         All notices required to be delivered to the Master Servicer under this
Agreement shall be delivered to the Master Servicer at the following address:

                Aurora Loan Services Inc.
                2530 South Parker Road
                Suite 601
                Aurora, Colorado  80014
                Attention:  E. Todd Whittemore, Master Servicing, SASCO 2001-16H
                Telephone:  (303) 632-3000
                Telecopier:  (303) 632-3001

         All remittances required to be made to the Master Servicer under this
Agreement shall be made on a scheduled/scheduled basis to the following wire
account:

                                       3
<PAGE>

               U.S. Bank National Association
               180 East Fifth Street
               St. Paul, MN 55101
               ABA#:  021-000-021
               ACCOUNT NAME: AURORA LOAN SERVICES INC., MASTER SERVICING PAYMENT
                             CLEARING ACCOUNT
               ACCOUNT NO.:  066-611059
               BENEFICIARY:  AURORA LOAN SERVICES INC.
               FOR FURTHER CREDIT TO:  SASCO 2001-16H

         All notices required to be delivered to the Trustee hereunder shall be
delivered to the Trustee at the following address:

               U.S. Bank National Association
               180 East Fifth Street
               St. Paul, MN 55101
               Telephone:  (651) 244-5000

         All notices required to be delivered to Lehman Capital hereunder shall
be delivered to Lehman Capital at the following address:

               Lehman Capital, a Division of
                 Lehman Brothers Holdings Inc.
               101 Hudson Street
               Jersey City, New Jersey
               33rd Floor
               Attention:  Structured Finance
               Telephone:  (201) 524-2320

         All notices required to be delivered to the Servicer hereunder shall be
delivered to the address of its office as set forth in the first paragraph of
this Agreement.

         8. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, NOTWITHSTANDING NEW YORK OR
OTHER CHOICE OF LAW RULES TO THE CONTRARY.

         9. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
but all of which counterparts shall together constitute but one and the same
instrument.

                                       4
<PAGE>

         Executed as of the day and year first above written.

                                           LEHMAN CAPITAL, A DIVISION OF
                                             LEHMAN BROTHERS HOLDINGS INC.,
                                                as Owner

                                           By:/S/ Joseph J. Kelly
                                              ---------------------------------
                                              Name:  Joseph J. Kelly
                                              Title: Senior Vice President

                                           BANK OF AMERICA, N.A.,
                                                as Servicer

                                           By:/s/ Jill E. Payne
                                              ---------------------------------
                                              Name:  Jill E. Payne
                                              Title: Vice President

ACKNOWLEDGED BY:

AURORA LOAN SERVICES INC.,
     as Master Servicer

By:/s/ E. Todd Whittemore
   ------------------------------
Name:  E. Todd Whittemore
Title: Exec. Vice President

U.S. BANK NATIONAL ASSOCIATION,
     as Trustee

By:/s/ S. Christopherson
   ------------------------------
Name:  S. Christopherson
Title: Vice President

<PAGE>

                                    EXHIBIT A

                Modifications to the Sale and Servicing Agreement

1.   A new definition of "Best Efforts" is hereby added to Section 1 to
     immediately follow the definition of "Assignment of Mortgage", to read as
     follows:

          Best Efforts: Efforts determined to be reasonably diligent by the
          Servicer in its reasonable discretion. Such efforts do not require the
          Servicer to enter into any litigation, arbitration or other legal or
          quasi-legal proceeding, nor do they require the Servicer to advance or
          expend fees or sums of money in addition to those specifically set
          forth in this Agreement.

2.   The definition of "Eligible Investments" in Section 1 is hereby amended and
     restated to read as follows:

          Eligible Investments: Any one or more of the obligations and
          securities listed below which investment provides for a date of
          maturity not later than the Determination Date in each month:

               (i) direct obligations of, and obligations fully guaranteed as to
          timely payment of principal and interest by, the United States of
          America or any agency or instrumentality of the United States of
          America the obligations of which are backed by the full faith and
          credit of the United States of America ("Direct Obligations");

               (ii) federal funds, or demand and time deposits in, certificates
          of deposits of, or bankers' acceptances issued by, any depository
          institution or trust company (including U.S. subsidiaries of foreign
          depositories and the Trustee or any agent of the Trustee, acting in
          its respective commercial capacity) incorporated or organized under
          the laws of the United States of America or any state thereof and
          subject to supervision and examination by federal or state banking
          authorities, so long as at the time of investment or the contractual
          commitment providing for such investment the commercial paper or other
          short-term debt obligations of such depository institution or trust
          company (or, in the case of a depository institution or trust company
          which is the principal subsidiary of a holding company, the commercial
          paper or other short-term debt or deposit obligations of such holding
          company or deposit institution, as the case may be) have been rated by
          each Rating Agency in its highest short-term rating category or one of
          its two highest long-term rating categories;

               (iii) repurchase agreements collateralized by Direct Obligations
          or securities guaranteed by GNMA, Fannie Mae or Freddie Mac with any
          registered broker/dealer subject to Securities Investors' Protection
          Corporation jurisdiction or any commercial bank insured by the FDIC,
          if such broker/dealer or bank has an

<PAGE>

          uninsured, unsecured and unguaranteed obligation rated by each Rating
          Agency in its highest short-term rating category;

               (iv) securities bearing interest or sold at a discount issued by
          any corporation incorporated under the laws of the United States of
          America or any state thereof which have a credit rating from each
          Rating Agency, at the time of investment or the contractual commitment
          providing for such investment, at least equal to one of the two
          highest long-term credit rating categories of each Rating Agency;
          provided, however, that securities issued by any particular
          corporation will not be Eligible Investments to the extent that
          investment therein will cause the then outstanding principal amount of
          securities issued by such corporation and held as part of the Trust
          Fund to exceed 20% of the sum of the aggregate principal balance of
          the Mortgage Loans; provided, further, that such securities will not
          be Eligible Investments if they are published as being under review
          with negative implications from either Rating Agency;

               (v) commercial paper (including both non-interest-bearing
          discount obligations and interest-bearing obligations payable on
          demand or on a specified date not more than 180 days after the date of
          issuance thereof) rated by each Rating Agency in its highest
          short-term rating category;

               (vi) a Qualified GIC;

               (vii) certificates or receipts representing direct ownership
          interests in future interest or principal payments on obligations of
          the United States of America or its agencies or instrumentalities
          (which obligations are backed by the full faith and credit of the
          United States of America) held by a custodian in safekeeping on behalf
          of the holders of such receipts; and

               (viii) any other demand, money market, common trust fund or time
          deposit or obligation, or interest-bearing or other security or
          investment, (A) rated in the highest rating category by each Rating
          Agency or (B) that would not adversely affect the then current rating
          by each Rating Agency of any of the Certificates. Such investments in
          this subsection (viii) may include money market mutual funds or common
          trust funds, including any fund for which the Trustee, the Master
          Servicer or an affiliate thereof serves as an investment advisor,
          administrator, shareholder servicing agent, and/or custodian or
          subcustodian, notwithstanding that (x) the Trustee, the Master
          Servicer or an affiliate thereof charges and collects fees and
          expenses from such funds for services rendered, (y) the Trustee, the
          Master Servicer or an affiliate thereof charges and collects fees and
          expenses for services rendered pursuant to this Agreement, and (z)
          services performed for such funds and pursuant to this Agreement may
          converge at any time, provided, however, that no such instrument shall
          be an Eligible Investment if such instrument evidences either (i) a
          right to receive only interest payments with respect to the
          obligations underlying such instrument, or (ii) both principal and
          interest payments derived from obligations underlying such instrument
          and the principal and interest payments with respect to such
          instrument provide a yield

                                      A-2
<PAGE>

          to maturity of greater than 120% of the yield to maturity at par of
          such underlying obligations.

3.   The definition of "Index" is hereby amended and restated to read as
     follows:

          Index: The index for the Mortgage Loans will be the "One-Year LIBOR",
          which is defined to be the arithmetic mean of the London interbank
          offered rate quotations for one year U.S. Dollar-denominated deposits,
          as published in The Wall Street Journal and most recently available
          either (i) as of the first Business Day in the month preceding the
          month of the applicable Adjustment Date or (ii) forty-five days before
          the applicable Adjustment Date. In the event such Index is no longer
          available, the Servicer will select a substitute Index in accordance
          with the terms of the related mortgage note and in compliance with
          federal and state law.

4.   The definition of "Mortgage Loan" is hereby amended and restated to read as
     follows:

          Mortgage Loan: An individual servicing retained Mortgage Loan which
          has been sold by Bank to Lehman Capital pursuant to the Assignment and
          Assumption Agreement and is subject to this Agreement being identified
          on the Mortgage Loan Schedule to this Agreement, which Mortgage Loan
          includes without limitation the Mortgage Loan documents, the monthly
          reports, Principal Prepayments, Liquidation Proceeds, Condemnation
          Proceeds, Insurance Proceeds, REO Disposition Proceeds and all other
          rights, benefits, proceeds and obligations arising from or in
          connection with such Mortgage Loan.

5.   The definition of "Mortgage Loan Schedule" is hereby amended and restated
     to read as follows:

          Mortgage Loan Schedule: The schedules of Mortgage Loans attached as
          Exhibit D to this Agreement setting forth certain information with
          respect to the Mortgage Loans acquired by the Bank from the Servicer
          pursuant to the Sale and Servicing Agreement which were in turn
          acquired by Lehman Capital from the Bank pursuant to the Assignment
          and Assumption Agreement.

6.   The definition of "Opinion of Counsel" in Section 1 is hereby amended by
     adding the following proviso at the end of such definition:

          ;provided, that any Opinion of Counsel relating to (a) qualification
          of the Mortgage Loans in a REMIC or (b) compliance with the REMIC
          Provisions, must be an opinion of counsel who (i) is in fact
          independent of the Servicer and the Master Servicer of the Mortgage
          Loans, (ii) does not have any material direct or indirect financial
          interest in the Servicer or the Master Servicer of the Mortgage Loans
          or in an affiliate of either and (iii) is not connected with the
          Servicer or the Master Servicer of the Mortgage Loans as an officer,
          employee, director or person performing similar functions.

                                      A-3
<PAGE>

7.   The definition of "Principal Prepayment" is hereby amended and restated to
     read as follows:

          "Principal Prepayment": Any payment or other recovery of principal on
          a Mortgage Loan which is received in advance of its scheduled Due Date
          that is not accompanied by an amount of interest representing
          scheduled interest due on any date or dates in any month or months
          subsequent to the month of prepayment and is applied to reduce the
          principal balance of the Mortgage Loan in accordance with the terms of
          the Mortgage Note.

8.   A new definition of "Qualified Depository" is hereby added to Section 1 to
     immediately follow the definition of "Qualified Appraiser" to read as
     follows:

          Qualified Depository: Any of (i) a federal or state-chartered
          depository institution the accounts of which are insured by the FDIC
          and whose commercial paper, short-term debt obligations or other
          short-term deposits are rated at least "A-1+" by Standard & Poor's
          Ratings Service ("S&P") if the deposits are to be held in the account
          for less than 30 days, or whose long-term unsecured debt obligations
          are rated at least "AA-" by S&P if the deposits are to be held in the
          account for more than 30 days, or (ii) the corporate trust department
          of a federal or state-chartered depository institution subject to
          regulations regarding fiduciary funds on deposit similar to Title 12
          of the Code of Federal Regulations Section 9.10(b), which, in either
          case, has corporate trust powers, acting in its fiduciary capacity, or
          (iii) Lehman Brothers Bank, F.S.B., a federal savings bank.

9.   A new definition of "Qualified GIC" is hereby added to Section 1 to
     immediately follow the definition of "Qualified Depository" to read as
     follows:

          Qualified GIC: A guaranteed investment contract or surety bond
          providing for the investment of funds in the Custodial Account and
          insuring a minimum, fixed or floating rate of return on investments of
          such funds, which contract or surety bond shall:

               (a) be an obligation of an insurance company or other corporation
          whose long-term debt is rated by each Rating Agency in one of its two
          highest rating categories or, if such insurance company has no
          long-term debt, whose claims paying ability is rated by each Rating
          Agency in one of its two highest rating categories, and whose
          short-term debt is rated by each Rating Agency in its highest rating
          category;

               (b) provide that the Servicer may exercise all of the rights
          under such contract or surety bond without the necessity of taking any
          action by any other Person;

               (c) provide that if at any time the then current credit standing
          of the obligor under such guaranteed investment contract is such that
          continued investment pursuant to such contract of funds would result
          in a downgrading of

                                      A-4
<PAGE>

          any rating of the Servicer, the Servicer shall terminate such contract
          without penalty and be entitled to the return of all funds previously
          invested thereunder, together with accrued interest thereon at the
          interest rate provided under such contract to the date of delivery of
          such funds to the Trustee;

               (d) provide that the Servicer's interest therein shall be
          transferable to any successor Servicer or the Master Servicer
          hereunder; and

               (e) provide that the funds reinvested thereunder and accrued
          interest thereon be returnable to the Custodial Account, as the case
          may be, not later than the Business Day prior to any Determination
          Date.

10.  A new definition of "Rating Agency" is hereby added to Section 1 to
     immediately follow the definition of "Qualified Depository", to read as
     follows:

          Rating Agency: Any of Moody's Investors Service, Inc., Standard &
          Poor's Ratings Service, a division of the McGraw-Hill Agencies, Inc.,
          or Fitch, Inc., or any successor of the foregoing.

11.  The definition of "Servicing Fee" in Section 1 is hereby amended in its
     entirety to read as follows:

          Servicing Fee: An amount equal to one-twelfth the product of (a) the
          Servicing Fee Rate and (b) the outstanding principal balance of the
          Mortgage Loan. The Servicing Fee is payable solely from the interest
          portion (including recoveries with respect to interest from
          Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds, REO
          Disposition Proceeds) of such Monthly Payment collected by the
          Servicer or as otherwise provided under this Agreement.

12.  The parties acknowledge that Section 2 shall be inapplicable to this
     Agreement.

13.  The parties acknowledge that the provisions of Section 3 are superseded by
     Exhibit D attached hereto.

14.  The parties acknowledge that Section 4 shall be inapplicable to this
     Agreement.

15.  The parties acknowledge that Section 5 shall be inapplicable to this
     Agreement.

16.  The parties hereto acknowledge that Section 6 (Delivery of Mortgage Loan
     Documents) of the Sale and Servicing Agreement shall be (i) superseded by
     the provisions of the Custodial Agreement, and (ii) modified to indicate
     that the Servicer shall prepare and execute at the direction of the Lehman
     Capital any note endorsements in connection with the transfer of the
     Mortgage Loans to the Trust Fund as the Owner of the Mortgage Loans and
     that Lehman Capital shall pay for any fees associated with the preparation
     and execution of such note endorsements to the Trust Fund.

                                      A-5
<PAGE>

17.  Subsection 7.03 (Remedies for Breach of Representations and Warranties) is
     hereby amended in its entirety to read as follows:

               It is understood and agreed that the representations and
          warranties set forth in Subsection 7.02 shall survive the engagement
          of the Servicer to perform the servicing responsibilities hereunder
          and the delivery of the servicing files to the Servicer and shall
          inure to the benefit of the Trustee, the Trust Fund and the Master
          Servicer. Upon discovery by either the Servicer, the Master Servicer
          or the Trustee of a breach of any of the foregoing representations and
          warranties set forth in Subsection 7.02 which materially and adversely
          affects the ability of the Servicer to perform its duties and
          obligations under this Agreement or otherwise materially and adversely
          affects the value of the Mortgage Loans, the Mortgaged Property or the
          priority of the security interest on such Mortgaged Property or the
          interest of the Trustee or the Trust Fund, the party discovering such
          breach shall give prompt written notice to the other.

               Within 60 days of the earlier of either discovery by or notice to
          the Servicer of any breach of a representation or warranty set forth
          in Subsection 7.02 which materially and adversely affects the ability
          of the Servicer to perform its duties and obligations under this
          Agreement or otherwise materially and adversely affects the value of
          the Loans, the Mortgaged Property or the priority of the security
          interest on such Mortgaged Property, the Servicer shall use its best
          efforts promptly to cure such breach in all material respects and, if
          such breach cannot be cured, the Servicer shall, at the Trustee's
          option, assign the Servicer's rights and obligations under this
          Agreement (or respecting the affected Loans) to a successor Servicer
          selected by the Trustee with the prior consent and approval of the
          Master Servicer. Such assignment shall be made in accordance with
          Subsection 14.03.

               In addition, the Servicer shall indemnify (from its own funds)
          the Trustee, the Trust Fund and Master Servicer and hold each of them
          harmless against any costs resulting from any claim, demand, defense
          or assertion based on or grounded upon, or resulting from, a breach of
          the Servicer's representations and warranties contained in Subsection
          7.02. It is understood and agreed that the remedies set forth in this
          Subsection 7.03 constitute the sole remedies of the Master Servicer,
          the Trust Fund and the Trustee respecting a breach of the foregoing
          representations and warranties.

               Any cause of action against the Servicer relating to or arising
          out of the breach of any representations and warranties made in
          Subsection 7.02 shall accrue upon (i) discovery of such breach by the
          Servicer or notice thereof by the Trustee or Master Servicer to the
          Servicer, (ii) failure by the Servicer to cure such breach within the
          applicable cure period, and (iii) demand upon the Servicer by the
          Trustee or the Master Servicer for compliance with this Agreement.

18.  The parties acknowledge that Section 8 shall be inapplicable to this
     Agreement.

19.  The parties acknowledge that Section 9 shall be inapplicable to this
     Agreement.

                                      A-6
<PAGE>

20.  The parties acknowledge that Section 10 shall be inapplicable to this
     Agreement.

21.  Subsection 11.01 (Servicer to Act as Servicer; Subservicing) is hereby
     amended as follows:

          (i) by deleting the fifth paragraph of such subsection and replacing
     it with the following:

               Consistent with the terms of this Agreement, the Servicer may
          waive, modify or vary any term of any Mortgage Loan or consent to the
          postponement of any such term or in any manner grant indulgence to any
          Mortgagor if in the Servicer's reasonable and prudent determination
          such waiver, modification, postponement or indulgence is not
          materially adverse to the Master Servicer, the Trustee or the Trust,
          provided, however, that unless the Mortgagor is in default with
          respect to the Mortgage Loan or such default is, in the judgment of
          the Servicer, imminent, the Servicer shall not permit any modification
          with respect to any Mortgage Loan that would change the mortgage
          interest rate, forgive the payment of principal or interest, reduce or
          increase the outstanding principal balance (except for actual payments
          of principal) or change the final maturity date on such Mortgage Loan.

          (ii) by adding the following to the end of the fifth paragraph of such
     subsection:

               Promptly after the execution of any assumption, modification,
          consolidation or extension of any Mortgage Loan, the Servicer shall
          forward to the Master Servicer copies of any documents evidencing such
          assumption, modification, consolidation or extension. Notwithstanding
          anything to the contrary contained in this Agreement, the Servicer
          shall not make or permit any modification, waiver or amendment of any
          term of any Mortgage Loan that would cause any REMIC created under the
          Trust Agreement to fail to qualify as a REMIC or result in the
          imposition of any tax under Section 860F(a) or Section 860G(d) of the
          Code.

22.  Subsection 11.03 (Collection of Mortgage Loan Payments) is hereby amended
     by replacing the words "Continuously from the date hereof until the
     principal and interest on all Mortgage Loans are paid in full" in the first
     and second lines thereof to "Continuously from the Closing Date until the
     date the Mortgage Loans cease to be subject to this Agreement".

23.  Subsection 11.04 (Establishment of Custodial Account; Deposits in Custodial
     Account) is hereby amended by:

          (i)  replacing the words "for Lehman Brothers Bank, FSB, as Purchaser
               of the Mortgage Loans and various Mortgagors" in the first
               paragraph of such Subsection with the words "for SASCO 2001-16H
               Trust Fund and various Mortgagors"; and

                                      A-7
<PAGE>

               (ii) by replacing the words "Principal Prepayment in full" in
          clause (i) of such Subsection with "Principal Prepayment in full or in
          part" in each place where those words appear.

24.  Subsection 11.05 (Withdrawals From the Custodial Account) is hereby amended
     by deleting the word "and" at the end of clause (h), by replacing the
     period at the end of clause (i) with a semicolon and by adding the
     following new clauses (j) and (k):

                    (j) to invest funds in the Custodial Account in Eligible
               Investments in accordance with Subsection 11.04; and

                    (k) to transfer funds to another Qualified Depository in
               accordance with Subsection 11.09 hereof.

25.  Subsection 11.06 (Establishment of Escrow Account; Deposits in Escrow
     Account) is hereby amended by replacing the words "for Lehman Brothers
     Bank, FSB, as Purchaser of Mortgage Loans and various Mortgagors" with "for
     SASCO 2001-16H Trust Fund and various Mortgagors."

26.  Subsection 11.09 (Transfer of Accounts) is hereby amended by replacing the
     words "depository institution" with "Qualified Depository."

27.  Subsection 11.13 (Title, Management and Disposition of REO Property) is
     hereby amended by adding the following paragraphs after the second
     paragraph of such Subsection:

               The Servicer shall use its Best Efforts to dispose of the REO
          Property as soon as possible and shall sell such REO Property in any
          event within three years after title has been taken to such REO
          Property, unless (a) a REMIC election has not been made with respect
          to the arrangement under which the Mortgage Loans and the REO Property
          are held, and (b) the Servicer determines, and gives an appropriate
          notice to the Master Servicer to such effect, that a longer period is
          necessary for the orderly liquidation of such REO Property. If a
          period longer than three years is permitted under the foregoing
          sentence and is necessary to sell any REO Property, (i) the Servicer
          shall report monthly to the Master Servicer as to the progress being
          made in selling such REO Property and (ii) if, with the written
          consent of the Trustee, a purchase money mortgage is taken in
          connection with such sale, such purchase money mortgage shall name the
          Servicer as mortgagee, and such purchase money mortgage shall not be
          held pursuant to this Agreement, but instead a separate participation
          agreement among the Servicer and Trustee shall be entered into with
          respect to such purchase money mortgage. Notwithstanding anything
          herein to the contrary, the Servicer shall not be required to provide
          financing for the sale of any REO Property.

               Prior to acceptance by the Servicer of an offer to sell any REO
          Property, the Servicer shall notify the Master Servicer of such offer
          in writing which notification shall set forth all material terms of
          said offer (each, a "Notice of

                                      A-8
<PAGE>

          Sale"). The Master Servicer shall be deemed to have approved the sale
          of any REO Property unless the Master Servicer notifies the Servicer
          in writing, within five (5) days after its receipt of the related
          Notice of Sale, that it disapproves of the related sale, in which case
          the Servicer shall not proceed with such sale.

28.  Subsection 11.15 (Distributions) is hereby amended by adding the following
     after the last paragraph of such Subsection:

               All remittances required to be made to the Master Servicer shall
          be made to the following wire account or to such other account as may
          be specified by the Master Servicer from time to time:

                       U.S. Bank National Association
                       180 East Fifth Street
                       St. Paul, MN 55101
                       ABA #: 021-000-021
                       ACCOUNT NAME: AURORA LOAN SERVICES INC.
                            MASTER SERVICING PAYMENT CLEARING ACCOUNT
                       ACCOUNT NUMBER: 066-611059
                       BENEFICIARY: AURORA LOAN SERVICES INC.
                       FOR FURTHER CREDIT TO:  AURORA LOAN SERVICES 2001-16H

29.  Subsection 11.16 (Statements to the Purchaser) is hereby amended as
     follows:

          (i) by adding the following paragraph immediately after the first
     paragraph of such Subsection:

               The monthly statement shall also include (A) on a current and
          cumulative basis the amount of any (i) claims filed, (ii) claim
          payments made, (iii) claims denied, (iv) policies cancelled with
          respect to those Serviced Mortgage Loans covered by any PMI Policy and
          (v) all such other information reasonably required by the Master
          Servicer and (B) the amount of any Monthly Advances made by the
          Servicer on such Monthly Remittance Date.

          (ii) by replacing the last paragraph of such Subsection in its
     entirety with the following paragraph:

               Beginning with calendar year 2001, the Servicer shall prepare and
          file any and all tax returns, information statements or other filings
          for the portion of the tax year 2000 and the portion of subsequent tax
          years for which the Servicer has serviced some or all of the Mortgage
          Loans hereunder as such returns, information statements or other
          filings are required to be delivered to any governmental taxing
          authority or to the Master Servicer pursuant to any applicable law
          with respect to the Mortgage Loans and the transactions contemplated
          hereby. In addition, the Servicer shall provide the Master Servicer
          with such information concerning the Mortgage Loans as is necessary
          for the

                                      A-9
<PAGE>

          Master Servicer to prepare the Trust Fund's federal income tax return
          as the Master Servicer may reasonably request from time to time.

30.  Subsection 11.20 (Annual Statement as to Compliance) is hereby amended by
     replacing the words "Within ninety (90) days after the Servicer's fiscal
     year end, beginning with the fiscal year end 2001" with "On or before April
     30th of each year, beginning with April 30, 2002."

31.  Subsection 11.21 (Annual Independent Public Accountants' Servicing Report)
     is hereby amended and restated in its entirety to read as follows:

               On or before April 30th of each year, beginning with April 30,
          2002, Servicer shall, at its own expense, cause a firm of independent
          public accountants (who may also render other services to Servicer),
          which is a member of the American Institute of Certified Public
          Accountants, to furnish to Lehman Capital and Master Servicer (i)
          year-end audited (if available) financial statements of the Servicer
          and (ii) a statement to the effect that such firm has examined certain
          documents and records for the preceding fiscal year (or during the
          period from the date of commencement of such Servicer's duties
          hereunder until the end of such preceding fiscal year in the case of
          the first such certificate) and that, on the basis of such examination
          conducted substantially in compliance with the Uniform Single
          Attestation Program for Mortgage Bankers, such firm is of the opinion
          that Servicer's overall servicing operations have been conducted in
          compliance with the Uniform Single Attestation Program for Mortgage
          Bankers except for such exceptions that, in the opinion of such firm,
          the Uniform Single Attestation Program for Mortgage Bankers requires
          it to report, in which case such exceptions shall be set forth in such
          statement.

32.  Subsections 12.01 (Indemnification; Third Party Claims) is amended and
     restated in its entirety to read as follows:

               The Servicer shall indemnify Lehman Capital, the Trust Fund, the
          Trustee and the Master Servicer and hold each of them harmless against
          any and all claims, losses, damages, penalties, fines, forfeitures,
          reasonable and necessary legal fees and related costs, judgements, and
          any other costs, fees and expenses that any of such parties may
          sustain in any way related to the failure of the Servicer to perform
          its duties and service the Mortgage Loans in strict compliance with
          the terms of this Agreement. The Servicer immediately shall notify
          Lehman Capital, the Master Servicer and the Trustee or any other
          relevant party if a claim is made by a third party with respect to
          this Agreement or the Mortgage Loans, assume (with the prior written
          consent of the indemnified party, which consent shall not be
          unreasonably withheld or delayed) the defense of any such claim and
          pay all expenses in connection therewith, including counsel fees, and
          promptly pay, discharge and satisfy any judgement or decree which may
          be entered against it or any of such parties in respect of such claim.
          The Servicer shall follow any written instructions received from the
          Trustee in connection with such claim. The Servicer shall provide the
          Trustee with a written report of all expenses and

                                      A-10
<PAGE>

          advances incurred by the Servicer pursuant to this Subsection 12.01,
          and the Trustee from the assets of the Trust Fund promptly shall
          reimburse the Servicer for all amounts advanced by it pursuant to the
          preceding sentence except when the claim is in any way relates to the
          failure of the Servicer to service and administer the Mortgage Loans
          in strict compliance with the terms of this Agreement or gross
          negligence, bad faith or willful misconduct of the Servicer.

33.  Subsection 13.01 (Events of Default) is hereby amended by changing all
     references to "Purchaser" with "Master Servicer" in such Subsection.

34.  Subsection 13.02 (Waiver of Default) is hereby amended by replacing the
     reference to "Purchaser" in such Subsection with "Master Servicer with the
     prior consent of the Trustee."

35.  Subsection 14.01 (Termination ) is hereby amended by adding the word "or"
     after clause (a) and deleting the word "or" at the end of clause (b) and
     deleting all of clause (c) and the last paragraph of such Subsection.

36.  Subsection 14.02 (Termination Without Cause) is hereby amended by replacing
     the first reference to "Purchaser" with "Lehman Capital (with the prior
     consent of the Trustee)" and by replacing all other references to
     "Purchaser" with "Lehman Capital."

37.  Subsection 14.03 (Successors to the Servicer) is hereby amended in its
     entirety to read as follows:

               Simultaneously with the termination of the Servicer's
          responsibilities and duties under this Agreement pursuant to
          Subsections 12.04, 13.01 or 14.01, the Master Servicer shall, in
          accordance with the provisions of the Trust Agreement (i) succeed to
          and assume all of the Servicer's responsibilities, rights, duties and
          obligations under this Agreement, or (ii) appoint a successor meeting
          the eligibility requirements of this Agreement, which shall succeed to
          all rights and assume all of the responsibilities, duties and
          liabilities of the Servicer under this Agreement with the termination
          of the Servicer's responsibilities, duties and liabilities under this
          Agreement. Any successor to the Servicer that is not at that time a
          Servicer of other mortgage loans for the Trust Fund shall be subject
          to the approval of the Master Servicer, Lehman Capital, the Trustee
          and each Rating Agency (as such term is defined in the Trust
          Agreement). Unless the successor servicer is at that time a servicer
          of other mortgage loans for the Trust Fund, each Rating Agency must
          deliver to the Trustee a letter to the effect that such transfer of
          servicing will not result in a qualification, withdrawal or downgrade
          of the then-current rating of any of the Certificates. In connection
          with such appointment and assumption, the Master Servicer or Lehman
          Capital, as applicable, may make such arrangements for the
          compensation of such successor out of payments on the Mortgage Loans
          as it and such successor shall agree; provided, however, that no such
          compensation shall be in excess of that permitted the Servicer under
          this Agreement. In the event that the Servicer's duties,
          responsibilities and liabilities under this Agreement should be
          terminated pursuant

                                      A-11
<PAGE>

          to the aforementioned Subsections, the Servicer shall discharge such
          duties and responsibilities during the period from the date it
          acquires knowledge of such termination until the effective date
          thereof with the same degree of diligence and prudence which it is
          obligated to exercise under this Agreement, and shall take no action
          whatsoever that might impair or prejudice the rights or financial
          condition of its successor. The resignation or removal of the Servicer
          pursuant to the aforementioned Subsections shall not become effective
          until a successor shall be appointed pursuant to this Subsection 14.03
          and shall in no event relieve the Servicer of the representations and
          warranties made pursuant to Section 7 shall be applicable to the
          Servicer notwithstanding any such resignation or termination of the
          Servicer, or the termination of this Agreement.

               Within a reasonable period of time, but in no event longer than
          30 days of the appointment of a successor entity, the Servicer shall
          prepare, execute and deliver to the successor entity any and all
          documents and other instruments, place in such successor's possession
          all Servicing Files, and do or cause to be done all other acts or
          things necessary or appropriate to effect the purposes of such notice
          of termination. The Servicer shall cooperate with the Trustee and the
          Master Servicer, as applicable, and such successor in effecting the
          termination of the Servicer's responsibilities and rights hereunder
          and the transfer of servicing responsibilities to the successor
          Servicer, including without limitation, the transfer to such successor
          for administration by it of all cash amounts which shall at the time
          be credited by the Servicer to the Custodial Account or any Escrow
          Account or thereafter received with respect to the Mortgage Loans.

               Any successor appointed as provided herein shall execute,
          acknowledge and deliver to the Trustee, the Servicer and the Master
          Servicer an instrument (i) accepting such appointment, wherein the
          successor shall make an assumption of the due and punctual performance
          and observance of each covenant and condition to be performed and
          observed by the Servicer under this Agreement, whereupon such
          successor shall become fully vested with all the rights, powers,
          duties, responsibilities, obligations and liabilities of the Servicer,
          with like effect as if originally named as a party to this Agreement.
          Any termination or resignation of the Servicer or termination of this
          Agreement pursuant to Subsections 13.01, 14.01 or 14.02 shall not
          affect any claims that the Master Servicer or the Trustee may have
          against the Servicer arising out of the Servicer's actions or failure
          to act prior to any such termination or resignation.

               The Servicer shall deliver within three (3) Business Days to the
          successor Servicer the funds in the Custodial Account and Escrow
          Account and all Mortgage Loan Documents and related documents and
          statements held by it hereunder and the Servicer shall account for all
          funds and shall execute and deliver such instruments and do such other
          things as may reasonably be required to more fully and definitively
          vest in the successor all such rights, powers, duties,
          responsibilities, obligations and liabilities of the Servicer.

                                      A-12
<PAGE>

               Upon a successor's acceptance of appointment as such, the
          Servicer shall notify the Trustee and Master Servicer of such
          appointment in accordance with the notice procedures set forth herein.

               Except as otherwise provided in this Agreement, all reasonable
          costs and expenses incurred in connection with any transfer of
          servicing hereunder (whether as a result of termination or removal of
          the Servicer with cause or resignation of the Servicer or otherwise),
          including, without limitation, the costs and expenses of the Master
          Servicer or any other Person in appointing a successor servicer, or of
          the Master Servicer in assuming the responsibilities of the Servicer
          hereunder, or of transferring the Servicing Files and the other
          necessary data to the successor servicer shall be paid by the
          terminated, removed or resigning Servicer from its own funds without
          reimbursement other than as provided in Section 14.02.

38.  Intended Third Party Beneficiaries. Notwithstanding any provision herein to
     the contrary, the parties to this Agreement agree that it is appropriate,
     in furtherance of the intent of such parties as set forth herein, that the
     Master Servicer and the Trustee receive the benefit of the provisions of
     this Agreement as intended third party beneficiaries of this Agreement to
     the extent of such provisions. The Servicer shall have the same obligations
     to the Master Servicer and the Trustee as if they were parties to this
     Agreement, and the Master Servicer and the Trustee shall have the same
     rights and remedies to enforce the provisions of this Agreement as if they
     were parties to this Agreement. The Servicer shall only take direction from
     the Master Servicer (if direction by the Master Servicer is required under
     this Agreement) unless otherwise directed by this Agreement.
     Notwithstanding the foregoing, all rights and obligations of the Master
     Servicer and the Trustee hereunder (other than the right to
     indemnification) shall terminate upon termination of the Trust Agreement
     and of the Trust Fund pursuant to the Trust Agreement.

                                      A-13
<PAGE>

                                    EXHIBIT B

                          Sale and Servicing Agreement

(retained in a separate closing binder entitled "SASCO 2001-16H Master
Servicing Agreement" at McKee Nelson LLP)

<PAGE>

                                    EXHIBIT C

                        Master Mortgage Loan Purchase and

                              Warranties Agreement

(retained in a separate closing binder entitled "SASCO 2001-16H Master Mortgage
Loan Purchase and Warranties Agreement" at McKee Nelson LLP)

<PAGE>

                                    EXHIBIT D

                             Mortgage Loan Schedules

(retained in a separate closing binder entitled "SASCO 2001-16H Mortgage Loan
Schedule" at McKee Nelson LLP)

<PAGE>

                                                                  EXECUTION COPY

                           MASTER SERVICING AGREEMENT

                                     between

                           CENTRE CAPITAL GROUP, INC.,

                                      OWNER

                                       and

                              BANK OF AMERICA, N.A.

                                    SERVICER

                            Dated as of May ___, 2000

                    Fixed and Adjustable Rate Mortgage Loans

<PAGE>

                                TABLE OF CONTENTS

                                                                            Page

                                    ARTICLE I

                                   DEFINITIONS

                                   ARTICLE II

      OWNER'S ENGAGEMENT OF SERVICER TO PERFORM SERVICING RESPONSIBILITIES

Section 2.01  Contract for Servicing; Possession of Servicing Files.........12
Section 2.02  Books and Records.............................................12
Section 2.03  Commencement of Servicing Responsibilities....................13
Section 2.04  Custodial Agreement...........................................13

                                   ARTICLE III

                         SERVICING OF THE MORTGAGE LOANS

Section 3.01  Servicer to Service...........................................14
Section 3.02  Liquidation of Mortgage Loans.................................15
Section 3.03  Collection of Mortgage Loan Payments..........................16
Section 3.04  Establishment of and Deposits to Custodial Account............16
Section 3.05  Permitted Withdrawals From Custodial Account..................17
Section 3.06  Establishment of and Deposits to Escrow Account...............18
Section 3.07  Permitted Withdrawals From Escrow Account.....................19
Section 3.08  Notification of Adjustments...................................20
Section 3.09  Completion and Recordation of Assignment of Mortgage..........20
Section 3.10  Protection of Accounts........................................20
Section 3.11  Payment of Taxes, Insurance and Other Charges.................21
Section 3.12  Maintenance of Hazard Insurance...............................21
Section 3.13  Force Placed Insurance........................................23
Section 3.14  Maintenance of Fidelity Bond and Errors and Omissions
               Insurance....................................................23
Section 3.15  Inspections...................................................24
Section 3.16  Restoration of Mortgaged Property.............................24
Section 3.17  Maintenance of PMI Policy and/or LPMI Policy; Claims..........25
Section 3.18  Title, Management and Disposition of REO Property.............26
Section 3.19  Real Estate Owned Reports.....................................27
Section 3.20  Liquidation Reports...........................................27
Section 3.21  Reports of Foreclosures and Abandonments of Mortgaged
               Property.....................................................27

                                      -i-
<PAGE>

Section 3.22  PMI and LPMI Obligations......................................28

                                   ARTICLE IV

                                PAYMENTS TO OWNER

Section 4.01  Remittances...................................................29
Section 4.02  Statements to Owner...........................................29
Section 4.03  Monthly Advances by Servicer..................................30
Section 4.04  Due Dates Other Than the First of the Month...................30

                                    ARTICLE V

                          GENERAL SERVICING PROCEDURES

Section 5.01  Servicing Compensation........................................31
Section 5.02  Transfers of Mortgaged Property...............................31
Section 5.03  Right to Examine Servicer Records.............................32
Section 5.04  Servicing Tape................................................32
Section 5.05  Satisfaction of Mortgages and Release of Mortgage Files.......32
Section 5.06  Annual Independent Public Accountants' Servicing Report.......33

                                   ARTICLE VI

                           REPRESENTATIONS, WARRANTIES
                                 AND AGREEMENTS

Section 6.01 Representations, Warranties and Agreements of the Servicer.....34
Section 6.02 Remedies for Breach of Representations and Warranties of the
               Servicer.....................................................35
Section 6.03  Representations and Warranties of the Owner...................36
Section 6.04  Remedies for Breach of Representations and Warranties of the
               Owner........................................................37

                                   ARTICLE VII

                   WHOLE LOAN TRANSFER; PASS-THROUGH TRANSFER

Section 7.01  Removal of Mortgage Loans from Inclusion Under this
               Agreement Upon a Pass-Through Transfer or a Whole Loan
               Transfer on One or More Reconstitution Dates.................39
Section 7.02  Owner's Repurchase and Indemnification Obligations............41
Section 7.03  Indemnification; Third Party Claims...........................42

                                      -ii-
<PAGE>

                                  ARTICLE VIII

                                  THE SERVICER

Section 8.01  Merger or Consolidation of the Servicer.......................44
Section 8.02  Limitation on Liability of the Servicer and Others............44
Section 8.03  Limitation on Resignation and Assignment by Servicer..........44

                                   ARTICLE IX

                                   TERMINATION

Section 9.01  Termination for Cause.........................................46
Section 9.02  Termination Without Cause.....................................47

                                    ARTICLE X

                            MISCELLANEOUS PROVISIONS

Section 10.01 Successor to the Servicer.....................................49
Section 10.02 Closing.......................................................50
Section 10.03 Closing Documents.............................................51
Section 10.04 Appointment and Designation of Master Servicer................52
Section 10.05 Costs.........................................................52
Section 10.06 Protection of Confidential Information........................52
Section 10.07 Notices.......................................................52
Section 10.08 Severability Clause...........................................53
Section 10.09 No Personal Solicitation......................................53
Section 10.10 Counterparts..................................................54
Section 10.11 Place of Delivery and Governing Law...........................54
Section 10.12 Further Agreements............................................54
Section 10.13 Intention of the Parties......................................54
Section 10.14 Successors and Assigns; Assignment of Agreement...............54
Section 10.15 Waivers.......................................................54
Section 10.16 Exhibits......................................................54
Section 10.17 General Interpretive Principles...............................55
Section 10.18 Reproduction of Documents.....................................55

                                      -iii-
<PAGE>

                                    EXHIBITS

EXHIBIT A MORTGAGE LOAN SCHEDULE
EXHIBIT B FORM OF ACKNOWLEDGMENT AGREEMENT
EXHIBIT C CUSTODIAL ACCOUNT LETTER AGREEMENT
EXHIBIT D ESCROW ACCOUNT LETTER AGREEMENT
EXHIBIT E-1 OFFICER'S CERTIFICATE FOR CLOSING
EXHIBIT E-2 OFFICER'S CERTIFICATE FOR SUBSEQUENT CLOSINGS
EXHIBIT F CUSTODIAL AGREEMENT
EXHIBIT G FORM OF OPINION OF COUNSEL OF THE SERVICER
EXHIBIT H INTENTIONALLY OMITTED
EXHIBIT I FORM OF ASSIGNMENT AND ASSUMPTION
EXHIBIT J FORM OF ASSIGNMENT AND ASSUMPTION

                                      -iv-
<PAGE>

                           MASTER SERVICING AGREEMENT

         This is a Master Servicing Agreement (the "Agreement"), dated as of May
__, 2000, by and between Centre Capital Group, Inc., having an office at 200
Pringle Avenue, Suite 500, Walnut Creek, CA 94596 (the "Owner") and Bank of
America, N.A. having an office at 2810 North Parham Road, Richmond VA 23294-4400
(the "Servicer").

                               W I T N E S S E T H

         WHEREAS, the Owner has acquired certain first lien fixed and adjustable
rate conventional mortgage loans on a servicing-retained basis (the "Mortgage
Loans") originated or acquired by the Servicer;

         WHEREAS, the Owner desires to contract with the Servicer, from time to
time, for the servicing responsibilities associated with the Mortgage Loans and
the Servicer desires to assume the servicing responsibilities to such Mortgage
Loans, from time to time, and the parties desire to provide the terms and
conditions of such servicing by the Servicer; and

         WHEREAS, the Owner desires to sell some or all of the Mortgage Loans
from time to time (a) to one or more third party purchasers in one or more whole
loan pools (each a "Whole Loan Transfer"); or (b) directly or indirectly, to
certain trusts to be formed as part of publicly-issued or privately placed,
rated or unrated, mortgage pass-through transactions (each a "Pass-Through
Transfer"), in any or all cases (subject to the terms of this Agreement)
retaining the Servicer to service the Mortgage Loans.

         NOW, THEREFORE, in consideration of the mutual agreements hereinafter
set forth, and for other good and reasonable consideration, the receipt and
adequacy of which is hereby acknowledged, the Owner and Servicer hereby agree as
follows:

<PAGE>

                                    ARTICLE I

                                   DEFINITIONS

         The following terms are defined as follows (except as otherwise agreed
in writing by the parties):

         Accepted Servicing Practices: With respect to any Mortgage Loan, those
mortgage servicing practices of prudent mortgage lending institutions which
service mortgage loans of the similar type as such Mortgage Loans in the
jurisdiction where the related Mortgaged Property is located.

         Acknowledgment Agreement: The document, substantially in the form of
Exhibit B, to be executed by the Owner and the Servicer on or prior to each
Closing Date which document shall amend the Mortgage Loan Schedule attached as
Exhibit A hereto to reflect the addition of Mortgage Loans to such Exhibit A and
which document reflects the addition of Mortgage Loans which are subject to the
terms and conditions of this Agreement.

         Agreement: This Master Servicing Agreement and all amendments hereof
and supplements hereto for the servicing and administering of the Mortgage
Loans.

         Ancillary Income: All income derived from the Mortgage Loans, other
than Servicing Fees, including but not limited to, late charges, prepayment
penalties, fees received with respect to checks or bank drafts returned by the
related bank for non-sufficient funds, assumption fees, optional insurance
administrative fees and all other incidental fees and charges. The Servicer
shall retain all Ancillary Income to the extent not required to be deposited
into the Custodial Account.

         ARM Mortgage Loan: A Mortgage Loan pursuant to which the interest rate
shall be adjusted from time to time in accordance with the related Mortgage
Note.

         Assignment of Mortgage: An assignment of the Mortgage, notice of
transfer or equivalent instrument in recordable form, sufficient under the laws
of the jurisdiction wherein the related Mortgaged Property is located to reflect
the transfer of the Mortgage to the party indicated therein.

         Best Efforts: Efforts determined to be reasonably diligent by the Owner
or Servicer, as the case may be, in its sole discretion. Such efforts do not
require the Owner or Servicer, as the case may be, to enter into any litigation,
arbitration or other legal or quasi-legal proceeding, nor do they require the
Owner or Servicer, as the case may be, to advance or expend fees or sums of
money in addition to those specifically set forth in this Agreement.

         BIF: The Bank Insurance Fund, or any successor thereto.

         Business Day: Any day other than (i) a Saturday or Sunday, or (ii) a
federal holiday.

                                      -2-
<PAGE>

         CCGI: Centre Capital Group, Inc.

         Closing Dates: The date or dates stated in the related Acknowledgment
Agreement, on which the Owner from time to time shall contract with the Servicer
for, and Servicer shall assume the servicing responsibilities for, the Mortgage
Loans on the related Mortgage Loan Schedule.

         Condemnation Proceeds: All awards of settlements in respect of a
Mortgaged Property, whether permanent or temporary, partial or entire, by
exercise of the power of eminent domain or condemnation, to the extent not
required to be released to a Mortgagor in accordance with the terms of the
related Mortgage Loan Documents.

         Custodial Account: The separate account or accounts created and
maintained pursuant to Section 3.04.

         Custodial Agreement: The agreement governing the retention of the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage and other
Mortgage Loan documents, which is annexed hereto as Exhibit F.

         Custodian: The Custodian under the Custodial Agreement, or its
successor in interest or assigns or any successor to the Custodian under the
Custodial Agreement as provided therein.

         Cut-off Date: With respect to each Mortgage Loan, the date set forth in
the related Mortgage Loan Schedule.

         Determination Date: The fifteenth (15th) day of the calendar month of
the related Remittance Date (or if such day is not a Business Day, the Business
Day immediately preceding such day).

         Due Date: The day of the month on which the Monthly Payment is due on a
Mortgage Loan, exclusive of any days of grace.

         Due Period: With respect to each Remittance Date, the period commencing
on the first day of the month preceding the month of the Remittance Date and
ending in the last day of the month preceding the Remittance Date.

         Duff & Phelps: Duff & Phelps Credit Rating Co. or any successor
thereto.

         Eligible Investments: Any one or more of the obligations and securities
listed below which investment provides for a date of maturity not later than the
Determination Date in each month:

         (a) direct general obligations of, or obligations fully and
unconditionally guaranteed as to the timely payment of principal and interest
by, the United States or any agency or instrumentality thereof, provided such
obligations are backed by the full faith and credit of the United States,
Federal Housing Administration debentures, Freddie Mac senior debt obligations,

                                      -3-
<PAGE>

and Fannie Mae senior debt obligations, but excluding any of such securities
whose terms do not provide for payment of a fixed dollar amount upon maturity or
call for redemption;

         (b) Federal Housing Administration debentures; provided, that any such
investment shall be rated in one of the two highest ratings categories by each
Rating Agency;

         (c) Freddie Mac participation certificates which guaranty timely
payment of principal and interest and senior debt obligations;

         (d) Consolidated senior debt obligations of any Federal Home Loan Bank;

         (e) Fannie Mae mortgage-backed securities (other than stripped mortgage
securities which are valued greater than par on the portion of unpaid principal)
and senior debt obligations;

         (f) Federal funds, certificates of deposit, time deposits, and bankers'
acceptances (having original maturities of not more than 365 days) of any
domestic bank, the short-term debt obligations of which have been rated F-1 or
better by Fitch, A-1 or better by Standard & Poor's and P-1 by Moody's;

         (g) Deposits of any bank or savings and loan association (the long-term
deposit rating of which is Baa3 or better by Moody's and BBB by each of Standard
& Poor's and Fitch) which has combined capital, surplus and undivided profits of
at least $50,000,000 which deposits are insured by the FDIC and held up to the
limits insured by the FDIC;

         (h) Investment agreements provided:

              (i) The agreement is with a bank or insurance company which has
         unsecured, uninsured and unguaranteed senior debt obligations rated Aa2
         or better by Moody's and AA or better by each of Standard & Poor's and
         Fitch, or is the lead bank of a parent bank holding company with an
         uninsured, unsecured and unguaranteed senior debt obligation meeting
         such rating requirements;

              (ii) Moneys invested thereunder may be withdrawn without any
         penalty, premium or charge upon not more than one day's notice
         (provided such notice may be amended or canceled at any time prior to
         the withdrawal date);

              (iii) The agreement is not subordinated to any other obligations
         of such insurance company or bank;

              (iv) The same guaranteed interest rate will be paid on any future
         deposits made pursuant to such agreement; and

              (v) The Owner receives an opinion of counsel (at the expense of
         the party requesting the investment) that such agreement is an
         enforceable obligation of such insurance company or bank.

                                      -4-
<PAGE>

         (i) Repurchase agreements collateralized by securities described in
(a), (c), or (e) above with any registered broker/dealer subject to the
Securities Investors Protection Corporation's jurisdiction and subject to
applicable limits therein promulgated by Securities Investors Protection
Corporation or any commercial bank, if such broker/dealer or bank has an
uninsured, unsecured and unguaranteed short-term or long-term obligation rated
P-1 or Aa2, respectively, or better by Moody's, A-1 or AA, respectively, or
better by Standard & Poor's and A-1 or AA, respectively, or better by Fitch,
provided:

              (i) A master repurchase agreement or specific written repurchase
         agreement governs the transaction;

              (ii) The securities are held free and clear of any lien by the
         Owner or an independent third party acting solely as agent for the
         Owner, and such third party is (a) a Federal Reserve Bank or (b) a bank
         which is a member of the FDIC and which has combined capital, surplus
         and undivided profits of not less than $125 million, and the Owner
         shall have received written confirmation from such third party that it
         holds such securities, free and clear of any lien, as agent for the
         Owner;

              (iii) A perfected first security interest under the Uniform
         Commercial Code, or book entry procedures prescribed at 31 CFR 306.1 et
         seq. or 31 CFR 350.0 et seq., in such securities is created for the
         benefit of the Owner;

              (iv) The repurchase agreement has a term of thirty days or less
         and the Owner will value the collateral securities no less frequently
         than monthly and will liquidate the collateral securities if any
         deficiency in the required collateral percentage is not restored within
         two business days of such valuation; and

              (v) The fair market value of the collateral securities in relation
         to the amount of the repurchase obligation, including principal and
         interest, is equal to at least 106%;

         (j) Commercial paper (having original maturities of not more than 270
days) rated in the highest short-term rating categories of each Rating Agency;

         (k) Investments in no load money market funds registered under the
Investment Company Act of 1940, whose shares are registered under the Securities
Act and rated Aaa by Moody's, AAAm or AAAm-G by Standard & Poor's and AAA, if
rated by Fitch; and

         (l) such other investments bearing interest or sold at a discount
approved in writing by the Owner in its sole discretion

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

                                      -5-
<PAGE>

all instruments described hereunder shall mature at par on or prior to the next
succeeding Payment Date unless otherwise provided in this Agreement and that no
instrument described hereunder may be purchased at a price greater than par if
such instrument may be prepaid or called at a price less than its purchase price
prior to stated maturity.

         Notwithstanding anything herein to the contrary, with respect to
Mortgage Loans subject to a Whole Loan Transfer or a Pass-Through Transfer, in
the event that the applicable Reconstitution Agreement has a more limiting
definition of "Eligible Investments", then the definition contained in such
Reconstitution Agreement shall apply to such Mortgage Loans.

         Errors and Omissions Insurance Policy: An errors and omissions
insurance policy to be maintained by the Servicer pursuant to Section 3.14.

         Escrow Account: The separate account or accounts operated and
maintained pursuant to Section 3.05.

         Escrow Mortgage Loans: The Mortgage Loans for which the Servicer has
established an Escrow Account for items constituting Escrow Payments.

         Escrow Payments: With respect to any Mortgage Loan, the amounts
constituting ground rents, taxes, assessments, water rates, sewer rents,
municipal charges, mortgage blanket insurance premiums, fire and hazard
insurance premiums, condominium charges, and any other payments required to be
escrowed by the Mortgagor with the mortgagee pursuant to the Mortgage or any
other related document.

         Event of Default: Any event set forth in Section 9.01.

         Fannie Mae: Fannie Mae, or any successor thereto.

         Fannie Mae Guides: The Fannie Mae Selling Guide and the Fannie Mae
Servicing Guide and all amendments or additions thereto.

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

         Fidelity Bond: A fidelity bond to be maintained by the Servicer
pursuant to the Section 3.14.

         First Remittance Date: With respect to each Mortgage Loan, the 18th day
of the month following the month in which the related Closing Date occurs, or if
such 18th day is not a Business Day, the first Business Day immediately
following such 18th day.

         Fitch: Fitch IBCA, Inc. or any successor thereto.

         Freddie Mac: Freddie Mac, or any successor thereto.

         Index: With respect to each ARM Mortgage Loan and with respect to each
related interest rate adjustment date, the index as specified in the related
Mortgage Note.

                                      -6-
<PAGE>

         Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.

         Liquidation Proceeds: Cash received in connection with the liquidation
of a defaulted Mortgage Loan, whether through the sale or assignment of such
Mortgage Loan, trustee's sale, foreclosure sale or otherwise, or the sale of the
related REO Property, if the Mortgaged Property is acquired in satisfaction of
the Mortgage Loan.

         LPMI Loan: A Mortgage Loan with a LPMI Policy.

         LPMI Policy: A policy of primary mortgage guaranty insurance issued by
United Guaranty Corporation or another Qualified Insurer pursuant to which the
related premium is to be paid by the Servicer of the related Mortgage Loan from
payments of interest made by the Mortgagor in an amount as is set forth in the
related Trade Confirmation Letter and Mortgage Loan Schedule.

         LPMI Fee: With respect to each LPMI Loan, the portion of the Mortgage
Interest Rate as set forth on the related Mortgage Loan Schedule (which shall be
payable solely from the interest portion of Monthly Payments, Insurance
Proceeds, Condemnation Proceeds or Liquidation Proceeds), which, during such
period prior to the required cancellation of the LPMI Policy, shall be used to
pay the premium due on the related LPMI Policy.

         Monthly Advance: With respect to each Remittance Date and each Mortgage
Loan, an amount equal to the Monthly Payment (with the interest portion of such
Monthly Payment, adjusted to the Mortgage Loan Remittance Rate) which was due on
the Mortgage Loan, and (i) which was delinquent at the close of business on the
immediately preceding Determination Date, and (ii) which was not the subject of
a previous Monthly Advance.

         Monthly Payment: The scheduled monthly payment of principal and
interest on a Mortgage Loan.

         Monthly Remittance Advice: The monthly report required to be furnished
by Servicer to Owner pursuant to Section 4.02.

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

         Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note, which creates a first lien on an unsubordinated estate in fee
simple in real property securing the Mortgage Note.

         Mortgage File: The items pertaining to a particular Mortgage Loan held
by the Custodian, and any additional documents required to be delivered to the
Custodian pursuant to this Agreement.

         Mortgage Interest Rate: The annual rate of interest borne on a Mortgage
Note. With respect to ARM Mortgage Loans, the Mortgage Interest Rate shall be
adjusted from time to time in accordance with the provisions of the Mortgage
Note.

                                      -7-
<PAGE>

         Mortgage Loan: An individual servicing retained Mortgage Loan which is
the subject of this Agreement, each Mortgage Loan subject to this Agreement
being identified on the Mortgage Loan Schedule, which Mortgage Loan includes
without limitation the Mortgage Loan documents, the Monthly Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
REO Disposition Proceeds, and all other rights, benefits, proceeds and
obligations arising from or in connection with such Mortgage Loan.

         Mortgage Loan Remittance Rate: With respect to each Mortgage Loan, the
annual rate of interest remitted to the Owner, which shall be equal to the
Mortgage Interest Rate minus the sum of (a) the Servicing Fee Rate and (b) with
respect to LPMI Loans, the LPMI Fee.

         Mortgage Loan Schedule: The schedule of certain Mortgage Loans setting
forth information with respect to such Mortgage Loans, which schedule
supplements this Agreement and becomes part of Exhibit A hereof on the related
Closing Date to reflect the addition of such Mortgage Loan to the terms of this
Agreement.

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

         Mortgaged Property: The real property securing repayment of the debt
evidenced by a Mortgage Note.

         Mortgagor: The obligor on a Mortgage Note.

         Non-Escrow Mortgage Loan: Any Mortgage Loan which is not an Escrow
Mortgage Loan.

         Officer's Certificate: A certificate signed by the Chairman of the
Board or the Vice Chairman of the Board or the President or a Vice President or
an Assistant Vice President and by the Treasurer or the Secretary or one of the
Assistant Treasurers or Assistant Secretaries of the Owner or Servicer, as
applicable, and delivered as required by this Agreement.

         Opinion of Counsel: A written opinion of counsel, who may be an
employee of the Servicer, reasonably acceptable to the Owner.

         Originator: The originator of the related Mortgage Loan.

         Owner: Centre Capital Group, Inc., or its successors in interest and
assigns.

         Pass-Through Transfer: The sale or transfer of some or all of the
Mortgage Loans to (i) a trust to be formed as part of a publicly-issued and/or
privately placed, rated or unrated, mortgage pass-through transaction, or (ii)
to Fannie Mae, Freddie Mac or GNMA on a negotiated basis, in each case,
retaining the Servicer as "servicer" (with or without a master servicer)
thereunder.

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

                                      -8-
<PAGE>

         PMI Policy: A policy of primary mortgage guaranty insurance issued by
United Guaranty Corporation or other AAA rated primary mortgage guaranty insurer
which meets all the requirements set forth in this agreement, in each case,
acceptable to the Owner in its sole discretion.

         Prepayment Interest Shortfall Amount: With respect to any Mortgage Loan
that was subject to a Principal Prepayment in full during the related Principal
Prepayment Period, which Principal Prepayment was applied to such Mortgage Loan
prior to such Mortgage Loan's Due Date in such related Principal Prepayment
Period, the amount of interest (net of the related Servicing Fee, and with
respect to the LPMI Loans, the LPMI Fee) that would have accrued on the amount
of such Principal Prepayment during the period commencing on the date as of
which such Principal Prepayment was applied to such Mortgage Loan and ending on
the day immediately preceding such Due Date, inclusive.

         Prime Rate: The prime rate announced to be in effect from time to time,
as published as the average rate in The Wall Street Journal Northeast Edition.

         Principal Prepayment: Any payment or other recovery of principal on a
Mortgage Loan which is received in advance of its scheduled Due Date, including
any prepayment charge or premium thereon and which is not accompanied by an
amount of interest representing scheduled interest due on any date or dates in
any month or months subsequent to the month of prepayment.

         Principal Prepayment Period: The month preceding the month in which the
related Remittance Date occurs.

         Qualified Depository: A depository the accounts of which are insured by
the FDIC through the BIF or the SAIF and the debt obligations of which are rated
AA or better by Standard & Poor's.

         Qualified Insurer: An insurer acceptable to the Owner in its sole
discretion.

         Rating Agency: Any of Fitch, Moody's, Standard & Poor's, Duff & Phelps
or their respective successors designed by the Owner.

         Reconstitution Agreements: The agreement or agreements entered into by
the Owner, the Servicer, and certain third parties on the Reconstitution Date(s)
with respect to any or all of the Mortgage Loans serviced hereunder, in
connection with a Whole Loan Transfer or a Pass-Through Transfer as set forth in
Section 7.01, including, but not limited to, a pooling and servicing agreement
and/or a subservicing/master servicing agreement and related custodial/trust
agreement and related documents with respect to a Pass-Through Transfer. Such
agreement or agreements shall prescribe the rights and obligations of the
Servicer in servicing the related Mortgage Loans and shall provide for servicing
compensation to the Servicer (calculated on a weighted average basis for all the
related Mortgage Loans as of the Reconstitution Date), at least equal to the
Servicing Fee and Ancillary Income due the Servicer in accordance with this
Agreement or the servicing fee required pursuant to the Reconstitution
Agreement, whichever is greater. The form of relevant Reconstitution Agreement
to be entered into by the Owner and/or

                                      -9-
<PAGE>

master servicer or trustee and the Servicer with respect to Pass-Through
Transfers and/or Whole Loan Transfers shall be reasonably satisfactory in form
and substance to the Owner and the Servicer (giving due regard to any rating or
master servicing requirements) and servicing provisions contained therein shall
be substantially similar to those contained in this Agreement and shall not
contain any obligations materially more onerous than those contained herein that
materially increase the expenses or obligations of the Servicer, unless
otherwise mutually agreed by the parties.

         Reconstitution Date: The date or dates on which any or all of the
Mortgage Loans serviced under this Agreement shall be removed from this
Agreement and reconstituted as part of a Pass-Through Transfer or a Whole Loan
Transfer pursuant to Section 7.01 hereof. On such date or dates, the Mortgage
Loans transferred shall cease to be covered by this Agreement and the Servicer's
servicing responsibilities shall cease under this Agreement with respect to the
related transferred Mortgage Loans.

         Remittance Date: The remittance date shall be the 18th day of each
calendar month (or if such 18th day is not a Business Day, the first Business
Day immediately following).

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

         REO Disposition Proceeds: All amounts received with respect to an REO
Disposition pursuant to Section 3.18.

         REO Property: A Mortgaged Property acquired by the Servicer on behalf
of the Owner through foreclosure or by deed in lieu of foreclosure, as described
in Section 3.18.

         Repurchase Price: With respect to any Mortgage Loan, a price equal to
(i) the Stated Principal Balance of the Mortgage Loan plus (ii) interest on such
Stated Principal Balance at the Mortgage Loan Remittance Rate, in each case from
the date on which interest has last been paid and distributed to the Owner to
the date of repurchase, less amounts received, if any, plus amounts advanced, if
any, by any servicer, in respect of such repurchased Mortgage Loan.

         SAIF: The Savings Association Insurance Fund, or any successor thereto.

         Servicer: Bank of America, N.A. or its successor in interest or assigns
or any successor to the Servicer under this Agreement as herein provided.

         Servicing Advances: All customary, reasonable and necessary "out of
pocket" costs and expenses (including reasonable attorneys' fees and
disbursements) incurred in the performance by the Servicer of its servicing
obligations, including, but not limited to, the cost of (a) the preservation,
restoration, inspection and protection of the Mortgaged Property, (b) any
enforcement or administrative or judicial proceedings, including foreclosures,
(c) the management and liquidation of any REO Property, and (d) compliance with
the obligations under Section 3.01, 3.02, 3.03, 3.04, 3.07, 3.12, 3.13, 3.16,
3.17, 3.18 and 3.22.

         Servicing Fee: With respect to each Mortgage Loan that has not been
removed from this Agreement as part of a Pass-Through Transfer or a Whole Loan
Transfer and with

                                      -10-
<PAGE>

respect to each Mortgage Loan that has been removed from this agreement as part
of a Pass-Through Transfer or a Whole Loan Transfer and subsequently repurchased
by the Owner pursuant to Section 7.02 hereof and again becoming subject to this
Agreement, the monthly amount of the annual fee the Owner shall pay to the
Servicer, which shall, for a period of one full month, be equal to one-twelfth
of the product of (a) the Servicing Fee Rate and (b) the outstanding principal
balance of such Mortgage Loan. Such fee shall be payable monthly, computed on
the basis of the same principal amount and period respecting which any related
interest payment on a Mortgage Loan is computed.

         Servicing Fee Rate: With respect to all Mortgage Loans, a rate equal to
0.25% per annum.

         Servicing File: The items pertaining to a particular Mortgage Loan
including, but not limited to, the computer files, data disks, books, records,
data tapes, notes, and all additional documents generated as a result of or
utilized in originating and/or servicing each Mortgage Loan, which are held in
trust for the Owner by the Servicer.

         Servicing Officer: Any officer of the Servicer involved in or
responsible for, the administration and servicing of the Mortgage Loans whose
name appears on a list of servicing officers furnished by the Servicer to the
Owner upon request, as such list may from time to time be amended.

         Standard & Poor's: Standard and Poor's Ratings Service, a division of
the McGraw-Hill Companies, Inc. or any successor thereto.

         Whole Loan Transfer: The sale or transfer of some or all of the
Mortgage Loans to a third party purchaser in a whole loan transaction pursuant
to a seller's warranties and servicing agreement or a participation and
servicing agreement, retaining the Servicer as "servicer" thereunder.

                                      -11-
<PAGE>

                                   ARTICLE II

      OWNER'S ENGAGEMENT OF SERVICER TO PERFORM SERVICING RESPONSIBILITIES

         Section 2.01 Contract for Servicing; Possession of Servicing Files.

         From time to time, the Owner, by execution and delivery of the related
Acknowledgment Agreement, in the form attached hereto as Exhibit B, and the
related Mortgage Loan Schedule, does hereby contract with the Servicer, subject
to the terms of this Agreement, for the servicing of the Mortgage Loans. The
Servicer has in its possession the Servicing Files with respect to the Mortgage
Loans listed on the related Mortgage Loan Schedule and the Servicer shall hold
the Servicing Files in trust for the Owner pursuant to this Agreement. Each
Servicing File shall be held by the Servicer in order to service the Mortgage
Loans pursuant to this Agreement and are and shall be held in trust by the
Servicer for the benefit of the Owner as the owner thereof. The Servicer's
possession of any portion of the Mortgage Loan documents shall be at the will of
the Owner for the sole purpose of facilitating servicing of the related Mortgage
Loan pursuant to this Agreement, and such retention and possession by the
Servicer shall be in a custodial capacity only. The ownership of each Mortgage
Note, Mortgage, and the contents of the Servicing File shall be vested in the
Owner and the ownership of all records and documents with respect to the related
Mortgage Loan prepared by or which come into the possession of the Servicer
shall immediately vest in the Owner and shall be retained and maintained, in
trust, by the Servicer at the will of the Owner in such custodial capacity only.
The portion of each Servicing File retained by the Servicer pursuant to this
Agreement shall be segregated from the other books and records of the Servicer
and shall be appropriately marked to clearly reflect the ownership of the
related Mortgage Loan by the Owner. The Servicer shall release from its custody
the contents of any Servicing File retained by it only in accordance with this
Agreement.

         Section 2.02 Books and Records.

         Record title to each Mortgage and the related Mortgage Note shall
remain in the name of (i) the Owner, (ii) the Servicer or (iii) in the name as
the Owner shall designate. Unless otherwise indicated herein, the Servicer shall
prepare and record any Assignments of Mortgage required pursuant to this Section
2.02. The Servicer shall pay all necessary fees associated with the initial
preparation, endorsement, and recording of the Assignments of Mortgage. The
Owner shall pay for any fee associated with the preparation, endorsement, or
recording of any subsequent Assignments of Mortgage. Additionally, the Servicer
shall prepare and execute, at the direction of the Owner, any note endorsements
in connection with any and all Reconstitution Agreements. The Servicer shall pay
all necessary fees associated with the preparation and execution of the initial
note endorsements; the Owner shall pay for any fee associated with the
preparation and execution of any subsequent note endorsements. All rights
arising out of the Mortgage Loans shall be vested in the Owner. All funds, other
than Servicing Fees and other amounts owed to the Servicer, received on or in
connection with a Mortgage Loan shall be

                                      -12-
<PAGE>

received and held by the Servicer in trust for the benefit of the Owner as the
owner of the Mortgage Loans pursuant to the terms of this Agreement.

         Section 2.03 Commencement of Servicing Responsibilities.

         On each Closing Date, the Owner shall appoint the Servicer to perform,
and the Servicer shall assume and accept such appointment for, all servicing
responsibilities for the related Mortgage Loans on the related Mortgage Loan
Schedule. Prior to each Closing Date, the Servicer shall have serviced the
related Mortgage Loans in accordance with Accepted Servicing Practices from the
date of origination of the related Mortgage Loans to the related Closing Date.

         Section 2.04 Custodial Agreement.

         On or prior to each Closing Date, the Custodian shall have certified
its receipt of all such Mortgage Loan documents required to be delivered
pursuant to the Custodial Agreement, as evidenced by the Initial Certification
of the Custodian in the form annexed to the Custodial Agreement. The applicable
purchaser shall be responsible for, as and when due, (i) any and all initial
document review fees, (ii) initial and final certification fees and
recertification fees, and (iii) any costs associated with correcting any
deficiencies identified in connection with such review(s). The applicable
purchaser shall be responsible for, as and when due, (x) any and all annual and
warehousing fees of the Custodian, (y) any and all termination fees in the event
the Custodian is terminated by the Servicer, and (z) any and all fees due in
connection with the deposit or retrieval of a Mortgage Loan document or
documents.

         The Servicer shall forward to the Custodian original documents
evidencing an assumption, modification, consolidation or extension of any
Mortgage Loan entered into in accordance with this Agreement within two (2)
weeks of their execution and shall provide the original of any document
submitted for recordation or a copy of such document certified by the
appropriate public recording office to be a true and complete copy of the
original within 180 days of its submission for recordation. In the event the
Servicer cannot provide a copy of such document certified by the public
recording office within such 180 day period, an Officer's Certificate of the
Servicer which shall (A) identify the recorded document, (B) state that the
recorded document has not been delivered to the Owner due solely to a delay
caused by the public recording office, (C) state the amount of time generally
required by the applicable recording office to record and return a document
submitted for recordation, if known, and (D) specify the date the applicable
recorded document is expected to be delivered to the Owner, and upon receipt of
a copy of such document certified by the public recording office, the Servicer
shall immediately deliver such document to the Owner. In the event the
appropriate public recording office will not certify as to the accuracy of such
document, the Servicer shall deliver a copy of such document certified by an
Officer's Certificate of the Servicer to be a true and complete copy of the
original to the Owner.

                                      -13-
<PAGE>

                                   ARTICLE III

                         SERVICING OF THE MORTGAGE LOANS

         Section 3.01 Servicer to Service.

         From the date of origination of the related Mortgage Loans to the
related Closing Date, the Servicer shall have serviced the related Mortgage
Loans in accordance with Accepted Servicing Practices. From and after the
related Closing Date, the Servicer, as an independent contractor, shall service
and administer the Mortgage Loans pursuant to this Agreement and shall have full
power and authority, acting alone, to do any and all things in connection with
such servicing and administration which the Servicer may deem necessary or
desirable, consistent with the terms of this Agreement and with Accepted
Servicing Practices.

         Consistent with the terms of this Agreement, the Servicer may waive,
modify or vary any term of any Mortgage Loan or consent to the postponement of
strict compliance with any such term or in any manner grant indulgence to any
Mortgagor if in the Servicer's reasonable and prudent determination such waiver,
modification, postponement or indulgence is not materially adverse to the Owner,
provided, however, that the Servicer shall not make any future advances with
respect to a Mortgage Loan and (unless the Mortgagor is in default with respect
to the Mortgage Loan or such default is, in the judgment of the Servicer,
imminent and the Servicer has obtained the prior written consent of the Owner)
the Servicer shall not permit any modification with respect to any Mortgage Loan
that would change the Mortgage Interest Rate, defer or forgive the payment of
principal or interest, reduce or increase the outstanding principal balance
(except for actual payments of principal) or change the final maturity date on
such Mortgage Loan. With respect to a Reconstitution Agreement, in the event of
any such modification which permits the deferral of interest or principal
payments on any Mortgage Loan, the Servicer shall, on the Business Day
immediately preceding the Remittance Date in any month in which any such
principal or interest payment has been deferred, deposit in the Custodial
Account from its own funds, in accordance with Section 3.04, the difference
between (a) such month's principal and one month's interest at the Mortgage Loan
Remittance Rate on the unpaid principal balance of such Mortgage Loan and (b)
the amount paid by the Mortgagor. Without limiting the generality of the
foregoing, the Servicer shall continue, and is hereby authorized and empowered,
to execute and deliver on behalf of itself and the Owner, all instruments of
satisfaction or cancellation, or of partial or full release, discharge and all
other comparable instruments, with respect to the Mortgage Loans and with
respect to the Mortgaged Properties. If reasonably required by the Servicer, the
Owner shall furnish the Servicer with any powers of attorney and other documents
necessary or appropriate to enable the Servicer to carry out its servicing and
administrative duties under this Agreement.

         In servicing and administering the Mortgage Loans, the Servicer shall
employ procedures (including collection procedures) and exercise the same care
that it customarily employs and exercises in servicing and administering
mortgage loans for its own account, giving due consideration to Accepted
Servicing Practices where such practices do not conflict with the requirements
of this Agreement, and the Owner's reliance on the Servicer.

                                      -14-
<PAGE>

         Absent written consultation and approval by the Owner, as specified in
this Section 3.01, the Servicer may take actions relative to the servicing and
administration of the Mortgage Loans that are consistent with Accepted Servicing
Practices.

         Section 3.02 Liquidation of Mortgage Loans.

         In the event that any payment due under any Mortgage Loan is not paid
when the same becomes due and payable, or in the event the Mortgagor fails to
perform any other covenant or obligation under the Mortgage Loan and such
failure continues beyond any applicable grace period, the Servicer shall take
such action as it shall deem to be in the best interest of the Owner, consistent
with any related PMI Policy or LPMI Policy. With respect to any defaulted
Mortgage Loan, the Servicer shall have the right to review the status of the
related forbearance plan and, subject to the second paragraph of Section 3.01,
may modify such forbearance plan; including extending the Mortgage Loan
repayment date for a period of one year. In connection with a foreclosure or
other conversion, the Servicer shall exercise such rights and powers vested in
it hereunder and use the same degree of care and skill in its exercise as
prudent mortgage servicers would exercise or use under the circumstances in the
conduct to their own affairs, including, without limitation, advancing funds for
the payment of taxes and insurance premiums. During this period and in the
administration of such defaulted Mortgage Loans, the Servicer shall be
responsible for making all customary Servicing Advances.

         Notwithstanding anything to the contrary contained herein, in
connection with a foreclosure or acceptance of a deed in lieu of foreclosure, in
the event the Servicer has reasonable cause to believe that a Mortgaged Property
is contaminated by hazardous or toxic substances or wastes, or if the Owner
otherwise requests an environmental inspection or review of such Mortgaged
Property to be conducted by a qualified inspector, the Servicer shall cause such
inspection to occur. Inspections conducted upon the Owner's request shall be at
the Owner's expense. Upon completion of the inspection, the Servicer shall
promptly provide the Owner with a written report of the environmental
inspection.

         After reviewing the environmental inspection report, the Owner shall
determine how the Servicer shall proceed with respect to the Mortgaged Property.
In the event (a) the environmental inspection report indicates that the
Mortgaged Property is contaminated by hazardous or toxic substances or wastes
and (b) the Owner directs the Servicer to proceed with foreclosure or acceptance
of a deed in lieu of foreclosure, the Servicer shall be reimbursed for all
reasonable costs associated with such foreclosure or acceptance of a deed in
lieu of foreclosure and any related environmental clean up costs, as applicable,
from the related Liquidation Proceeds, or if the Liquidation Proceeds are
insufficient to fully reimburse the Servicer, the Servicer shall be entitled to
be reimbursed from amounts in the Custodial Account pursuant to Section 3.05
hereof. In the event the Owner directs the Servicer not to proceed with
foreclosure or acceptance of a deed in lieu of foreclosure, the Servicer shall
be reimbursed for all Servicing Advances made with respect to the related
Mortgaged Property from the Custodial Account pursuant to Section 3.05 hereof.

                                      -15-
<PAGE>

         Section 3.03 Collection of Mortgage Loan Payments.

         Continuously from the related Closing Date until the date each Mortgage
Loan ceases to be subject to this Agreement, the Servicer shall proceed
diligently to collect all payments due under each of the Mortgage Loans when the
same shall become due and payable and, with respect to Escrow Mortgage Loans
only, shall take special care in ascertaining and estimating Escrow Payments and
all other charges that will become due and payable with respect to the Mortgage
Loans and each related Mortgaged Property, to the end that the installments
payable by the Mortgagors will be sufficient to pay such charges as and when
they become due and payable.

         Section 3.04 Establishment of and Deposits to Custodial Account.

         The Servicer shall segregate and hold all funds collected and received
pursuant to the Mortgage Loans separate and apart from any of its own funds and
general assets and shall establish and maintain one or more Custodial Accounts,
in the form of time deposit or demand accounts, titled "Bank of America, N.A. in
trust for Centre Capital Group, Inc., owner of Fixed and Adjustable Rate
Mortgage Loans, and various Mortgagors" (provided, in the event that this
Agreement is assigned to a third party, the Custodial Account(s) shall be
reestablished in trust for such Assignee). The Custodial Account shall be
established with a Qualified Depository acceptable to the Owner. Any funds
deposited in the Custodial Account shall at all times be fully insured to the
full extent permitted under applicable law. Funds deposited in the Custodial
Account may be drawn on by the Servicer in accordance with Section 3.05. The
creation of any Custodial Account shall be evidenced by a letter agreement in
the form of Exhibit C hereto. A copy of such letter agreement shall be furnished
to the Owner and, upon request, to any subsequent owner of the Mortgage Loans.

         The Servicer shall deposit in the Custodial Account within 48 hours of
receipt, and retain therein, the following collections received by the Servicer
and payments made by the Servicer after the related Closing Date, other than
payments of principal and interest due on or before the Cut-off Date, or
received by the Servicer prior to the Cut-off Date but allocable to a period
subsequent thereto:

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

         (ii) any amounts received from the Originator in connection with the
    repurchase of any Mortgage Loan;

         (iii) all payments on account of interest on the Mortgage Loans
    adjusted to the Mortgage Loan Remittance Rate;

         (iv) all Liquidation Proceeds;

         (v) all Insurance Proceeds including amounts required to be deposited
    pursuant to Section 3.12 (other than proceeds to be held in the Escrow
    Account and applied to the

                                      -16-
<PAGE>

    restoration and repair of the Mortgaged Property or released to the
    Mortgagor in accordance with Section 3.17) and Section 3.17;

         (vi) all Condemnation Proceeds that are not applied to the restoration
    or repair of the Mortgaged Property or released to the Mortgagor;

         (vii) any amount required to be deposited in the Custodial Account
    pursuant to Sections 3.01, 3.10, 4.03, 5.01 or 5.02;

         (viii) with respect to each Principal Prepayment in full or in part,
    the Prepayment Interest Shortfall Amount, if any, for the month of
    distribution. Such deposit shall be made from the Servicer's own funds,
    without reimbursement therefor up to a maximum amount per month of the
    Servicing Fee actually received for such month for the Mortgage Loans; and

         (ix) any amounts received with respect to or related to any REO
    Property or REO Disposition Proceeds.

         The foregoing requirements for deposit into the Custodial Account shall
be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, payments in the nature of (a) Servicing Fees which
are payable solely from the interest portion of Monthly Payments, Insurance
Proceeds, Condemnation Proceeds, Liquidation Proceeds, or (b) Ancillary Income,
need not be deposited by the Servicer into the Custodial Account. Any interest
paid on funds deposited in the Custodial Account by the depository institution
shall accrue to the benefit of the Servicer and the Servicer shall be entitled
to retain and withdraw such interest from the Custodial Account pursuant to
Section 3.05. Additionally, any other benefit derived from the Custodial Account
associated with the receipt, disbursement and accumulation of principal,
interest, taxes, hazard insurance, mortgage blanket insurance, etc. shall accrue
to the Servicer.

         Section 3.05 Permitted Withdrawals From Custodial Account.

         The Servicer shall, from time to time, withdraw funds from the
Custodial Account for the following purposes:

         (i) to make payments to the Owner in the amounts and in the manner
    provided for in Section 4.01;

         (ii) with respect to each LPMI Loan, in the amount of LPMI Fee, to make
    payments with respect to premiums for LPMI Policies;

         (iii) to reimburse itself for Monthly Advances of the Servicer's funds
    made pursuant to Section 4.03, the Servicer's right to reimburse itself
    pursuant to this subclause (ii) being limited to amounts received on the
    related Mortgage Loan which represent late payments of principal and/or
    interest respecting which any such advance was made, it being understood
    that, in the case of any such reimbursement, the Servicer's right thereto
    shall be prior to the rights of Owner;

                                      -17-
<PAGE>

         (iv) to reimburse itself for unreimbursed Servicing Advances, the
    Servicer's right to reimburse itself pursuant to this subclause (iii) with
    respect to any Mortgage Loan (a) being limited to related Liquidation
    Proceeds, Condemnation Proceeds, Insurance Proceeds and such other amounts
    as may be collected by the Servicer from the Mortgagor or otherwise relating
    to the Mortgage Loan and (b) if, after the liquidation of such Mortgage
    Loan, such payments are insufficient to satisfy such unreimbursed Servicing
    Advances then the Servicer may seek reimbursement from other amounts in the
    Custodial Account, it being understood that, in the case of any such
    reimbursement, the Servicer's right thereto shall be prior to the rights of
    the Owner;

         (v) to pay itself interest on funds deposited in the Custodial Account
    and to pay itself the Servicing Fee pursuant to Section 5.01 hereof;

         (vi) to clear and terminate the Custodial Account upon the termination
    of this Agreement;

         (vii) to transfer funds to another Qualified Depository in accordance
    with Section 3.10 hereof;

         (viii) to pay any amount required to be paid pursuant to Section 3.18
    related to any REO Property, it being understood that in the case of any
    such expenditure or withdrawal related to a particular REO Property, the
    amount of such expenditure or withdrawal from the Custodial Account shall be
    limited to amounts on deposit in the Custodial Account with respect to the
    related REO Property;

         (ix) to invest funds in certain Eligible Investments in accordance with
    Section 3.10 hereof; and

         (x) to withdraw funds deposited in error.

         In the event that the Custodial Account is interest bearing, on each
Remittance Date, the Servicer shall withdraw all funds from the Custodial
Account except for those amounts which, pursuant to Section 4.01, the Servicer
is not obligated to remit on such Remittance Date. The Servicer may use such
withdrawn funds only for the purposes described in this Section 3.05.

         Section 3.06 Establishment of and Deposits to Escrow Account.

         The Servicer shall segregate and hold all funds collected and received
pursuant to a Mortgage Loan constituting Escrow Payments separate and apart from
any of its own funds and general assets and shall establish and maintain one or
more Escrow Accounts, in the form of time deposit or demand accounts, titled,
"Bank of America, N.A. in trust for Centre Capital Group, Inc., owner of Fixed
and Adjustable Rate Mortgage Loans, and various Mortgagors" (provided, in the
event that this Agreement is assigned to a third party, the Escrow Account(s)
shall be reestablished in trust for such Assignee). The Escrow Accounts shall be
established with a Qualified Depository in a manner that shall provide maximum
available insurance thereunder. Funds deposited in the Escrow Account may be
drawn on by the Servicer in accordance with Section 3.07. The creation of any
Escrow Account shall be evidenced by a letter agreement in

                                      -18-
<PAGE>

the form of Exhibit D hereto. A copy of such letter agreement shall be furnished
to the Owner and, upon request, to any subsequent owner of the Mortgage Loans.

         The Servicer shall deposit in the Escrow Account or Accounts within 48
hours of receipt, and retain therein:

         (i) all Escrow Payments collected on account of the Mortgage Loans, for
    the purpose of effecting timely payment of any such items as required under
    the terms of this Agreement; and

         (ii) all amounts representing Insurance Proceeds or Condemnation
    Proceeds which are to be applied to the restoration or repair of any
    Mortgaged Property.

         The Servicer shall make withdrawals from the Escrow Account only to
effect such payments as are required under this Agreement, as set forth in
Section 3.07. The Servicer shall retain any interest paid on funds deposited in
the Escrow Account by the depository institution, other than interest on
escrowed funds required by law to be paid to the Mortgagor. To the extent
required by law, the Servicer shall pay interest on escrowed funds to the
Mortgagor notwithstanding that the Escrow Account may be non-interest bearing or
that interest paid thereon is insufficient for such purposes.

         Section 3.07 Permitted Withdrawals From Escrow Account.

         Withdrawals from the Escrow Account or Accounts may be made by the
Servicer only:

         (i) to effect timely payments of ground rents, taxes, assessments,
    water rates, mortgage insurance premiums, condominium charges, fire and
    hazard insurance premiums or other items constituting Escrow Payments for
    the related Mortgage;

         (ii) to reimburse the Servicer for any Servicing Advance made by the
    Servicer with respect to a related Mortgage Loan, but only from amounts
    received on the related Mortgage Loan which represent late collections of
    Escrow Payments thereunder;

         (iii) to refund to any Mortgagor any funds found to be in excess of the
    amounts required under the terms of the related Mortgage Loan;

         (iv) for transfer to the Custodial Account and application to reduce
    the principal balance of the Mortgage Loan in accordance with the terms of
    the related Mortgage and Mortgage Note;

         (v) for application to restoration or repair of the Mortgaged Property
    in accordance with the procedures outlined in Section 3.16;

         (vi) to pay to the Servicer, or any Mortgagor to the extent required by
    law, any interest paid on the funds deposited in the Escrow Account;

                                      -19-
<PAGE>

         (vii) to clear and terminate the Escrow Account on the termination of
    this Agreement; and

         (viii) to withdraw funds deposited in error.

         Section 3.08 Notification of Adjustments.

         With respect to each ARM Mortgage Loan, the Servicer shall adjust the
Mortgage Interest Rate on the related interest rate adjustment date and shall
adjust the Monthly Payment on the related mortgage payment adjustment date, if
applicable, in compliance with the requirements of applicable law and the
related Mortgage and Mortgage Note. The Servicer shall execute and deliver any
and all necessary notices required under applicable law and the terms of the
related Mortgage Note and Mortgage regarding the Mortgage Interest Rate and
Monthly Payment adjustments. The Servicer shall promptly, upon written request
therefor, deliver to the Owner, at the Owner's expense, such notifications and
any additional applicable data regarding such adjustments and the methods used
to calculate and implement such adjustments. Upon the discovery by the Servicer
or the receipt of notice from the Owner that the Servicer has failed to adjust a
Mortgage Interest Rate or Monthly Payment in accordance with the terms of the
related Mortgage Note, the Servicer shall immediately deposit in the Custodial
Account from its own funds the amount of any interest loss or deferral caused
the Owner thereby.

         Section 3.09 Completion and Recordation of Assignment of Mortgage.

         To the extent permitted by applicable law, each of the Assignments of
Mortgage is subject to recordation in all appropriate public offices for real
property records in all the counties or other comparable jurisdictions in which
any or all of the Mortgaged Properties are situated, and in any other
appropriate public recording office or elsewhere, such recordation to be
effected at the Servicer's expense at the direction of the Owner. At the Owner's
direction and expense (provided that the Servicer shall be responsible only for
such expenses with respect to the first set of Assignments of Mortgages prepared
and recorded after the related Closing Date), the Servicer shall cause the
endorsements on the Mortgage Note, the Assignment of Mortgage, and the
assignment of security agreement to be completed. Notwithstanding the transfer
of rights pursuant to any Assignments of Mortgage, the Servicer shall remain
liable for the expenses associated with the preparation, endorsement and
recordation with respect to the first set of Assignments of Mortgages prepared
and recorded after the related Closing Date.

         Section 3.10 Protection of Accounts.

         The Servicer may transfer the Custodial Account or the Escrow Account
to a different Qualified Depository from time to time. Such transfer shall be
made only upon obtaining the consent of the Owner, which consent shall not be
withheld unreasonably, provided, however, if the Owner does not respond within
30 days after receipt of request for consent, the Owner shall have been deemed
to consent to such transfer.

         The Servicer shall bear any expenses, losses or damages sustained by
the Owner because the Custodial Account and/or the Escrow Account are not demand
deposit accounts and/or money market accounts.

                                      -20-
<PAGE>

         Amounts on deposit in the Custodial Account may at the option of the
Servicer be invested in Eligible Investments; provided that in the event that
amounts on deposit in the Custodial Account or the Escrow Account exceed the
amount fully insured by the FDIC (the "Insured Amount") the Servicer shall be
obligated to invest the excess amount over the Insured Amount in Eligible
Investments on the same Business Day as such excess amount becomes present in
the Custodial Account or the Escrow Account. Any such Eligible Investment shall
mature no later than the Determination Date next following the date of such
Eligible Investment, provided, however, that if such Eligible Investment is an
obligation of a Qualified Depository that maintains the Custodial Account, then
such Eligible Investment may mature on such Remittance Date. Any such Eligible
Investment shall be made in the name of the Servicer in trust for the benefit of
the Owner. All income on or gain realized from any such Eligible Investment
shall be for the benefit of the Servicer and may be withdrawn at any time by the
Servicer. Any losses incurred in respect of any such investment shall be
deposited in the Custodial Account, by the Servicer out of its own funds
immediately as realized.

         Section 3.11 Payment of Taxes, Insurance and Other Charges.

         With respect to each Mortgage Loan, the Servicer shall maintain
accurate records reflecting the status of ground rents, taxes, assessments,
water rates, sewer rents, and other charges which are or may become a lien upon
the Mortgaged Property and the status of PMI Policy and LPMI Policy premiums and
fire and hazard insurance coverage and shall obtain, from time to time, all
bills for the payment of such charges (including renewal premiums) and shall
effect payment thereof prior to the applicable penalty or termination date,
employing for such purpose deposits of the Mortgagor in the Escrow Account which
shall have been estimated and accumulated by the Servicer in amounts sufficient
for such purposes, as allowed under the terms of the Mortgage. The Servicer
assumes full responsibility for the timely payment of all such bills, shall
effect timely payment of all such charges irrespective of each Mortgagor's
faithful performance in the payment of same or the making of the Escrow
Payments, and shall make advances from its own funds to effect such payments.
With regard to Non-Escrow Mortgage Loans, the Servicer shall use reasonable
efforts consistent with Accepted Servicing Practices to determine that any such
payments are made by the Mortgagor at the time they first became due and shall
insure that the Mortgaged Property is not lost to a tax lien as a result of
nonpayment and that such Mortgage is not left uninsured and shall make advances
from its own funds to effect any such delinquent payments to avoid the lapse of
insurance coverage on the Mortgaged Property or to avoid the imposition of a tax
lien.

         Section 3.12 Maintenance of Hazard Insurance.

         The Servicer shall cause to be maintained for each Mortgage Loan hazard
insurance such that all buildings upon the Mortgaged Property are insured by a
generally acceptable insurer rated B:III or better in the current Best's Key
Rating Guide ("Best's") against loss by fire, hazards of extended coverage and
such other hazards as are customary in the area where the Mortgaged Property is
located, in an amount which is at least equal to the lesser of (i) 100% of the
maximum insurable value of the improvements securing such Mortgage Loan and (ii)
the greater of (a) the outstanding principal balance of the Mortgage Loan and
(b) an amount

                                      -21-
<PAGE>

such that the proceeds thereof shall be sufficient to prevent the Mortgagor or
the loss payee from becoming a co-insurer.

         If upon origination of the Mortgage Loan, the related Mortgaged
Property was located in an area identified in the Federal Register by the Flood
Emergency Management Agency as having special flood hazards (and such flood
insurance has been made available) a flood insurance policy meeting the
requirements of the current guidelines of the Federal Insurance Administration
is in effect with a generally acceptable insurance carrier rated B:III or better
in Best's in an amount representing coverage equal to the lesser of (i) the
minimum amount required, under the terms of coverage, to compensate for any
damage or loss on a replacement cost basis (or the unpaid balance of the
mortgage if replacement cost coverage is not available for the type of building
insured) and (ii) the maximum amount of insurance which is available under the
Flood Disaster Protection Act of 1973, as amended. If at any time during the
term of the Mortgage Loan, the Servicer determines in accordance with applicable
law and pursuant to the Fannie Mae Guides that a Mortgaged Property is located
in a special flood hazard area and is not covered by flood insurance or is
covered in an amount less than the amount required by the Flood Disaster
Protection Act of 1973, as amended, the Servicer shall notify the related
Mortgagor that the Mortgagor must obtain such flood insurance coverage, and if
said Mortgagor fails to obtain the required flood insurance coverage within
forty-five (45) days after such notification, the Servicer shall immediately
force place the required flood insurance on the Mortgagor's behalf.

         If a Mortgage is secured by a unit in a condominium project, the
Servicer shall verify that the coverage required of the owner's association,
including hazard, flood, liability, and fidelity coverage, is being maintained
in accordance with then current Fannie Mae requirements, and secure from the
owner's association its agreement to notify the Servicer promptly of any change
in the insurance coverage or of any condemnation or casualty loss that may have
a material effect on the value of the Mortgaged Property as security.

         The Servicer shall cause to be maintained on each Mortgaged Property
any additional insurance as may be required pursuant to applicable laws.

         In the event that any Owner or the Servicer shall determine that the
Mortgaged Property should be insured against loss or damage by hazards and risks
not covered by the insurance required to be maintained by the Mortgagor pursuant
to the terms of the Mortgage, the Servicer shall, in accordance with Accepted
Servicing Practices, provide notice of such to the Mortgagor.

         All policies required hereunder shall name the Servicer as loss payee
and shall be endorsed with standard or union mortgagee clauses, without
contribution, which shall provide for at least 30 days prior written notice of
any cancellation, reduction in amount or material change in coverage.

         The Servicer shall not interfere with the Mortgagor's freedom of choice
in selecting either his insurance carrier or agent, provided, however, that the
Servicer shall not accept any such insurance policies from insurance companies
unless such companies are rated B:III or better in Best's and are licensed to do
business in the jurisdiction in which the

                                      -22-
<PAGE>

Mortgaged Property is located. The Servicer shall determine that such policies
provide sufficient risk coverage and amounts, that they insure the property
owner, and that they properly describe the property address. The Servicer shall
furnish to the Mortgagor a formal notice of expiration of any such insurance in
sufficient time for the Mortgagor to arrange for renewal coverage by the
expiration date.

         Pursuant to Section 3.04, any amounts collected by the Servicer under
any such policies (other than amounts to be deposited in the Escrow Account and
applied to the restoration or repair of the related Mortgaged Property, or
property acquired in liquidation of the Mortgage Loan, or to be released to the
Mortgagor, in accordance with the Servicer's normal servicing procedures as
specified in Section 3.16) shall be deposited in the Custodial Account subject
to withdrawal pursuant to Section 3.05.

         Section 3.13 Force Placed Insurance.

         Each Mortgage obligates the Mortgagor thereunder to maintain the
required hazard insurance policy at the Mortgagor's cost and expense, and on the
Mortgagor's failure to do so, authorizes the Servicer to obtain and maintain
such insurance at such Mortgagor's cost and expense, and to seek reimbursement
therefor from the Mortgagor. Upon any failure of the Mortgagor to maintain the
required hazard insurance, the Servicer shall obtain and maintain such force
placed hazard insurance at the Mortgagor's cost and expense.

         Section 3.14 Maintenance of Fidelity Bond and Errors and Omissions
Insurance.

         The Servicer shall maintain with responsible companies, at its own
expense, a blanket Fidelity Bond and an Errors and Omissions Insurance Policy,
with broad coverage on all officers, employees or other persons acting in any
capacity requiring such persons to handle funds, money, documents or papers
relating to the Mortgage Loans ("Servicer Employees"). Any such Fidelity Bond
and Errors and Omissions Insurance Policy shall be in the form of the Mortgage
Banker's Blanket Bond and shall protect and insure the Servicer against losses,
including forgery, theft, embezzlement, fraud, errors and omissions and
negligent acts of such Servicer Employees. Such Fidelity Bond and Errors and
Omissions Insurance Policy also shall protect and insure the Servicer against
losses in connection with the release or satisfaction of a Mortgage Loan without
having obtained payment in full of the indebtedness secured thereby. No
provision of this Section 3.14 requiring such Fidelity Bond and Errors and
Omissions Insurance Policy shall diminish or relieve the Servicer from its
duties and obligations as set forth in this Agreement. The minimum coverage
under any such bond and insurance policy shall be at least equal to the
corresponding amounts required by Fannie Mae in the Fannie Mae Guides or by
Freddie Mac in the Freddie Mac Sellers' & Servicers' Guide. Upon the request of
any Owner, the Servicer shall cause to be delivered to such Owner a certified
true copy of such fidelity bond and insurance policy and a statement from the
surety and the insurer that such fidelity bond and insurance policy shall in no
event be terminated or materially modified without using commercially reasonable
efforts to provide 30 days' prior written notice to the Owner.

                                      -23-
<PAGE>

         Section 3.15 Inspections.

         The Servicer shall inspect the Mortgaged Property as often as deemed
necessary by the Servicer to assure itself that the value of the Mortgaged
Property is being preserved. In addition, if any Mortgage Loan is more than 90
days delinquent, the Servicer immediately shall inspect the Mortgaged Property
and shall conduct subsequent inspections in accordance with Accepted Servicing
Practices. The Servicer shall keep an electronic report of each such inspection.

         Section 3.16 Restoration of Mortgaged Property.

         The Servicer need not obtain the approval of the Owner prior to
releasing any Insurance Proceeds or Condemnation Proceeds to the Mortgagor to be
applied to the restoration or repair of the Mortgaged Property if such release
is in accordance with Accepted Servicing Practices. At a minimum, with respect
to claims greater than $10,000, the Servicer shall comply with the following
conditions in connection with any such release of Insurance Proceeds or
Condemnation Proceeds:

         (i) the Servicer shall receive satisfactory independent verification of
    completion of repairs and issuance of any required approvals with respect
    thereto;

         (ii) the Servicer shall take all steps necessary to preserve the
    priority of the lien of the Mortgage, including, but not limited to
    requiring waivers with respect to mechanics' and materialmen's liens;

         (iii) the Servicer shall verify that the Mortgage Loan is not 60 or
    more days delinquent; and

         (iv) pending repairs or restoration, the Servicer shall place the
    Insurance Proceeds or Condemnation Proceeds in the Escrow Account.

         With respect to claims of $10,000 or less, the Servicer shall comply
with the following conditions in connection with any such release of Insurance
Proceeds or Condemnation Proceeds:

         (i) the related Mortgagor shall provide an affidavit verifying the
    completion of repairs and issuance of any required approvals with respect
    thereto;

         (ii) the Servicer shall verify the total amount of the claim with the
    applicable insurance company; and

         (iii) pending repairs or restoration, the Servicer shall place the
    Insurance Proceeds or Condemnation Proceeds in the Escrow Account.

         If the Owner is named as an additional loss payee, the Servicer is
hereby empowered to endorse any loss draft issued in respect of such a claim in
the name of the Owner.

                                      -24-
<PAGE>

         Section 3.17 Maintenance of PMI Policy and/or LPMI Policy; Claims.

         With respect to each Mortgage Loan with a LTV in excess of 80%, the
Servicer shall:

         (i) with respect to Mortgage Loans which are not LPMI Loans, without
    any cost to the Owner, maintain or cause the Mortgagor to maintain in full
    force and effect a PMI Policy insuring that portion of the Mortgage Loan in
    excess of 67% (or such other percentage as stated in the related
    Acknowledgment Agreement) of value, and shall pay or shall cause the
    Mortgagor to pay the premium thereon on a timely basis, until the LTV of
    such Mortgage Loan is reduced to 80%. In the event that such PMI Policy
    shall be terminated, the Servicer shall obtain from another Qualified
    Insurer a comparable replacement policy, with a total coverage equal to the
    remaining coverage of such terminated PMI Policy, at substantially the same
    fee level. The Servicer shall not take any action which would result in
    noncoverage under any applicable PMI Policy of any loss which, but for the
    actions of the Servicer would have been covered thereunder. In connection
    with any assumption or substitution agreement entered into or to be entered
    into pursuant to Section 5.02, the Servicer shall promptly notify the
    insurer under the related PMI Policy, if any, of such assumption or
    substitution of liability in accordance with the terms of such PMI Policy
    and shall take all actions which may be required by such insurer as a
    condition to the continuation of coverage under such PMI Policy. If such PMI
    Policy is terminated as a result of such assumption or substitution of
    liability, the Servicer shall obtain a replacement PMI Policy as provided
    above.

         (ii) with respect to LPMI Loans, maintain in full force and effect an
    LPMI Policy insuring that portion of the Mortgage Loan in excess of 67% (or
    such other percentage as stated in the related Acknowledgment Agreement) of
    value, and from time to time, withdraw the LPMI Fee with respect to such
    LPMI Loan from the Custodial Account in order to pay the premium thereon on
    a timely basis, until the LTV of such Mortgage Loan is reduced to 80%. In
    the event that the interest payments made with respect to any LPMI Loan are
    less than the LPMI Fee, the Servicer shall advance from its own funds the
    amount of any such shortfall in the LPMI Fee, in payment of the premium on
    the related LPMI Policy. Any such advance shall be a Servicing Advance
    subject to reimbursement pursuant to the provisions on Section 3.05. In the
    event that such LPMI Policy shall be terminated, the Servicer shall obtain
    from another Qualified Insurer a comparable replacement policy, with a total
    coverage equal to the remaining coverage of such terminated LPMI Policy, at
    substantially the same fee level. The Servicer shall not take any action
    which would result in noncoverage under any applicable LPMI Policy of any
    loss which, but for the actions of the Servicer would have been covered
    thereunder. In connection with any assumption or substitution agreement
    entered into or to be entered into pursuant to Section 5.02, the Servicer
    shall promptly notify the insurer under the related LPMI Policy, if any, of
    such assumption or substitution of liability in accordance with the terms of
    such LPMI Policy and shall take all actions which may be required by such
    insurer as a condition to the continuation of coverage under such PMI
    Policy. If such LPMI Policy is terminated as a result of such assumption or
    substitution of liability, the Servicer shall obtain a replacement LPMI
    Policy as provided above.

                                      -25-
<PAGE>

         In connection with its activities as servicer, the Servicer agrees to
prepare and present, on behalf of itself and the Owner, claims to the insurer
under any PMI Policy or LPMI Policy in a timely fashion in accordance with the
terms of such PMI Policy or LPMI Policy and, in this regard, to take such action
as shall be necessary to permit recovery under any PMI Policy or LPMI Policy
respecting a defaulted Mortgage Loan. Pursuant to Section 3.04, any amounts
collected by the Servicer under any PMI Policy or LPMI Policy shall be deposited
in the Custodial Account, subject to withdrawal pursuant to Section 3.05.

         Section 3.18 Title, Management and Disposition of REO Property.

         In the event that title to any Mortgaged Property is acquired in
foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale
shall be taken in the name of the Servicer, or in the event the Servicer is not
authorized or permitted to hold title to real property in the state where the
REO Property is located, or would be adversely affected under the "doing
business" or tax laws of such state by so holding title, the deed or certificate
of sale shall be taken in the name of such Person or Persons as shall be
consistent with an Opinion of Counsel obtained by the Servicer from any attorney
duly licensed to practice law in the state where the REO Property is located.
The Person or Persons holding such title other than the Owner shall acknowledge
in writing that such title is being held as nominee for the Owner.

         The Servicer shall manage, conserve, protect and operate each REO
Property for the Owner solely for the purpose of its prompt disposition and
sale. The Servicer, either itself or through an agent selected by the Servicer,
shall manage, conserve, protect and operate the REO Property in the same manner
that it manages, conserves, protects and operates other foreclosed property for
its own account, and in the same manner that similar property in the same
locality as the REO Property is managed. The Servicer shall attempt to sell the
same (and may temporarily rent the same for a period not greater than one year,
except as otherwise provided below) on such terms and conditions as the Servicer
deems to be in the best interest of the Owner.

         The Servicer shall use its Best Efforts to dispose of the REO Property
as soon as possible and shall sell such REO Property in any event within three
years after title has been taken to such REO Property, unless (i) a REMIC
election has not been made with respect to the arrangement under which the
Mortgage Loans and the REO Property are held, and (ii) the Servicer determines,
and gives an appropriate notice to the Owner to such effect, that a longer
period is necessary for the orderly liquidation of such REO Property. If a
period longer than one and a half years is permitted under the foregoing
sentence and is necessary to sell any REO Property, (i) the Servicer shall
report monthly to the Owner as to the progress being made in selling such REO
Property and (ii) if, with the written consent of the Owner, a purchase money
mortgage is taken in connection with such sale, such purchase money mortgage
shall name the Servicer as mortgagee, and such purchase money mortgage shall not
be held pursuant to this Agreement, but instead a separate participation
agreement among the Servicer and Owner shall be entered into with respect to
such purchase money mortgage.

         The Servicer shall also maintain on each REO Property fire and hazard
insurance with extended coverage in an amount which is at least equal to the
lesser of (a) 100% of the maximum insurable value of the improvements which are
a part of such property, or (b) unpaid principal balance of the related Mortgage
Loan at the time it becomes an REO Property, liability

                                      -26-
<PAGE>

insurance and, to the extent required and available under the Flood Disaster
Protection Act of 1973, as amended, flood insurance in the amount required
above.

         The disposition of REO Property shall be carried out by the Servicer at
such price, and upon such terms and conditions, as the Servicer deems to be in
the best interests of the Owner. The proceeds of sale of the REO Property shall
be promptly deposited in the Custodial Account. As soon as practical thereafter
the expenses of such sale shall be paid and the Servicer shall reimburse itself
for any related unreimbursed Servicing Advances, unpaid Servicing Fees, and on
the Remittance Date immediately following the date on which such sale proceeds
are received the net cash proceeds of such sale remaining in the Custodial
Account shall be distributed to the Owner.

         The Servicer shall advance funds necessary for the proper operation,
management and maintenance of the REO Property, including the cost of
maintaining any hazard insurance pursuant to Section 3.12 and the fees of any
managing agent of the Servicer, or the Servicer itself, which advances shall be
deemed "Servicing Advances" for the purposes hereunder. The REO management fee
shall be an amount that is reasonable and customary in the area where the
Mortgaged Property is located. The Servicer shall make monthly distributions on
each Remittance Date to the Owners of the net cash flow from the REO Property
(which shall equal the revenues from such REO Property net of the expenses
described in this Section 3.18 and of any reserves reasonably required from time
to time to be maintained to satisfy anticipated liabilities for such expenses).

         Notwithstanding the foregoing, at any time and from time to time, the
Owner may at its election terminate this Agreement with respect to one or more
REO Properties as provided by Section 9.02.

         Section 3.19 Real Estate Owned Reports.

         Together with the statement furnished pursuant to Section 4.02, the
Servicer shall furnish to the Owner upon request an electronic statement with
respect to any REO Property covering the operation of such REO Property for the
previous month and the Servicer's efforts in connection with the sale of such
REO Property and any rental of such REO Property incidental to the sale thereof
for the previous month. That statement shall be accompanied by such other
information as the Owner shall reasonably request.

         Section 3.20 Liquidation Reports.

         Upon the foreclosure sale of any Mortgaged Property or the acquisition
thereof by the Owner pursuant to a deed in lieu of foreclosure, the Servicer
shall submit to the Owner a liquidation report with respect to such Mortgaged
Property.

         Section 3.21 Reports of Foreclosures and Abandonments of Mortgaged
Property.

         Following the foreclosure sale or abandonment of any Mortgaged
Property, the Servicer shall report such foreclosure or abandonment as required
pursuant to Section 6050J of

                                      -27-
<PAGE>

the Internal Revenue Code of 1986, as it may be amended from time to time, or
any successor statute thereto, and applicable U.S. Department of the Treasury
regulations issued pursuant thereto.

         Section 3.22 PMI and LPMI Obligations.

         The Servicer shall comply with all provisions of applicable state and
federal law relating to the cancellation of, or collection of premiums with
respect to, PMI Policies and LPMI Policies, including, but not limited to, the
provisions of the Homeowners Protection Act of 1998, and all regulations
promulgated thereunder, as amended from time to time. The Servicer shall be
obligated to make premium payments with respect to (a) LPMI Policies, and (b) if
the Mortgagor fails to pay any PMI Policy premium, such PMI Policy.

                                      -28-
<PAGE>

                                   ARTICLE IV

                                PAYMENTS TO OWNER

         Section 4.01 Remittances.

         On each Remittance Date the Servicer shall remit by wire transfer of
immediately available funds to the Owner (a) all amounts deposited in the
Custodial Account as of the close of business on the Determination Date (net of
charges against or withdrawals from the Custodial Account pursuant to Section
3.05), plus (b) all amounts, if any, which the Servicer is obligated to
distribute pursuant to Section 4.03, minus (c) any amounts attributable to
Principal Prepayments received after the applicable Principal Prepayment Period
which amounts shall be remitted on the following Remittance Date, together with
any additional interest required to be deposited in the Custodial Account in
connection with such Principal Prepayment in accordance with Section 3.04(viii),
and minus (d) any amounts attributable to Monthly Payments collected but due on
a Due Date or Dates subsequent to the first day of the month of the Remittance
Date, which amounts shall be remitted on the Remittance Date next succeeding the
Due Period for such amounts.

            With respect to any remittance received by the Owner after the
second Business Day following the Business Day on which such payment was due,
the Servicer shall pay to the Owner interest on any such late payment at an
annual rate equal to the Prime Rate, adjusted as of the date of each change,
plus three percentage points, but in no event greater than the maximum amount
permitted by applicable law. Such interest shall be deposited in the Custodial
Account by the Servicer on the date such late payment is made and shall cover
the period commencing with the day following such second Business Day and ending
with the Business Day on which such payment is made, both inclusive. Such
interest shall be remitted along with the distribution payable on the next
succeeding Remittance Date. The payment by the Servicer of any such interest
shall not be deemed an extension of time for payment or a waiver of any Event of
Default by the Servicer.

         Section 4.02 Statements to Owner.

         (a) Not later than the Remittance Date, the Servicer shall furnish to
the Owner a monthly statement (a "Monthly Remittance Advice") containing such
information in the form of FNMA form 2010 or such other form as shall be
required by the FNMA Guides or by the Owner in hard copy or electronic medium
mutually acceptable to the parties as to the accompanying remittance and the
period ending on the preceding Determination Date.

         (b) In addition, such Monthly Remittance Advice shall track, on a
monthly basis, the Mortgage Interest Rate and the delinquency status of the
Mortgage Loans. A cumulative delinquency report shall be provided to the Owner
upon the Owner's request.

         Beginning with calendar year 2001, the Servicer shall prepare and file
any and all tax returns, information statements or other filings for the tax
year 2000 and subsequent tax years required to be delivered to any governmental
taxing authority or to the Owner pursuant to any

                                      -29-
<PAGE>

applicable law with respect to the Mortgage Loans and the transactions
contemplated hereby. In addition, the Servicer shall provide the Owner with such
information concerning the Mortgage Loans as is necessary for the Owner to
prepare its federal income tax return as the Owner may reasonably request from
time to time.

         Section 4.03 Monthly Advances by Servicer.

         On the Business Day immediately preceding each Remittance Date, the
Servicer shall deposit in the Custodial Account from its own funds an amount
equal to all Monthly Payments (with interest adjusted to the Mortgage Loan
Remittance Rate) which were due on the Mortgage Loans during the applicable Due
Period and which were delinquent at the close of business on the immediately
preceding Determination Date or which were deferred pursuant to Section 3.01.
The Servicer's obligation to make such Monthly Advances as to any Mortgage Loan
will continue through the last Monthly Payment due prior to the payment in full
of the Mortgage Loan, or through the last Remittance Date prior to the
Remittance Date for the distribution of all Liquidation Proceeds and other
payments or recoveries (including Insurance Proceeds and Condemnation Proceeds)
with respect to the Mortgage Loan unless the Servicer deems such Monthly
Advances to be unrecoverable, as evidenced by an Officer's Certificate of the
Servicer delivered to the Owner.

         Section 4.04 Due Dates Other Than the First of the Month.

         Mortgage Loans having Due Dates other than the first day of a month,
including Mortgage Loans permitting semi-annual amortization of principal, shall
be accounted for as described in this Section 4.04. Any payment due on a day
other than the first day of each month shall be considered due on the first day
of the month in which that payment is due as if such payment were due on the
first day of said month. For example, a payment due on August 15 shall be
considered to be due on August 1 of said month. With respect to a Mortgage Note
permitting semi-annual amortization of principal, the Servicer shall be required
to remit monthly scheduled principal and interest based on a monthly
amortization schedule. Any payment collected on a Mortgage Loan after the
Cut-off Date shall be deposited in the Custodial Account. For Mortgage Loans
with Due Dates on the first day of a month, deposits to the Custodial Account
begin with the payment due on the first of the month following the Cut-off Date.

                                      -30-
<PAGE>

                                    ARTICLE V

                          GENERAL SERVICING PROCEDURES

         Section 5.01 Servicing Compensation.

         As compensation for its services hereunder, the Servicer shall be
entitled to withdraw from the Custodial Account or to retain from interest
payments on the Mortgage Loans the amount of its Servicing Fee. The Servicing
Fee shall be payable monthly and shall be computed on the basis of the same
unpaid principal balance and for the period respecting which any related
interest payment on a Mortgage Loan is computed.

         Additional servicing compensation in the form of Ancillary Income shall
be retained by the Servicer to the extent not required to be deposited in the
Custodial Account. The Servicer shall be entitled to retain late charges whether
or not deposited to the Custodial Account. The Servicer shall be required to pay
all expenses incurred by it in connection with its servicing activities
hereunder and shall not be entitled to reimbursement thereof except as
specifically provided for herein.

         Section 5.02 Transfers of Mortgaged Property.

         The Servicer shall use its best efforts to enforce any "due-on-sale"
provision contained in any Mortgage or Mortgage Note and to deny assumption by
the person to whom the Mortgaged Property has been or is about to be sold
whether by absolute conveyance or by contract of sale, and whether or not the
Mortgagor remains liable on the Mortgage and the Mortgage Note; provided that,
if in the Servicer's prudent business judgment, it determines that an assumption
of the Mortgage Loan is in the best interests of the Owner, it shall deliver
notice of such determination to the Owner and may permit such assumption if
approved by the Owner. When the Mortgaged Property has been conveyed by the
Mortgagor, the Servicer shall, to the extent it has knowledge of such conveyance
or the Owner's consent otherwise in accordance with the preceding sentence,
exercise its rights to accelerate the maturity of such Mortgage Loan under the
"due-on-sale" clause applicable thereto, provided, however, that the Servicer
shall not be required to take such action if the Servicer, in its prudent
business judgment, believes it is not in the best interests of the Owner and
shall not exercise such rights if prohibited by law from doing so or if the
exercise of such rights would impair or threaten to impair any recovery under
the related PMI Policy or LPMI Policy, if any.

         If the Servicer reasonably believes it is unable under applicable law
to enforce such "due-on-sale" clause or if the Owner approves such assumption
pursuant to the preceding paragraph, the Servicer shall enter into (i) an
assumption and modification agreement with the person to whom such property has
been conveyed, pursuant to which such person becomes liable under the Mortgage
Note and the original Mortgagor remains liable thereon or (ii) in the event the
Servicer is unable under applicable law to require that the original Mortgagor
remain liable under the Mortgage Note and the Servicer has the prior consent of
the primary mortgage guaranty insurer, a substitution of liability agreement
with the Owner of the Mortgaged Property

                                      -31-
<PAGE>

pursuant to which the original Mortgagor is released from liability and the
Owner of the Mortgaged Property is substituted as Mortgagor and becomes liable
under the Mortgage Note; provided that no such substitutions should be permitted
unless such person satisfies the underwriting criteria of the Servicer and has a
credit risk rating at least equal to that of the original Mortgagor. The
Mortgage Loan, as assumed, shall conform in all respects to the requirements,
representations and warranties of this Agreement. The Servicer shall notify the
Owner that any such assumption or substitution agreement has been contemplated
by forwarding to the Owner the original copy of such assumption or substitution
agreement (indicating the Mortgage File to which it relates) which copy shall be
added by the Owner to the related Mortgage File and which shall, for all
purposes, be considered part of such Mortgage File to the same extent as all
other documents and instruments constituting a part thereof. The Servicer shall
be responsible for recording any such assumption or substitution agreements. In
connection with any such assumption or substitution agreement, the Monthly
Payment on the related Mortgage Loan shall not be changed but shall remain as in
effect immediately prior to the assumption or substitution, the Mortgage
Interest Rate, the stated maturity or the outstanding principal amount of such
Mortgage Loan shall not be changed nor shall any required monthly payments of
principal or interest be deferred or forgiven. Any assumption fee collected by
the Servicer for entering into an assumption agreement shall be retained by the
Servicer as additional servicing compensation. In connection with any such
assumption, neither the Mortgage Interest Rate borne by the related Mortgage
Note, the term of the Mortgage Loan nor the outstanding principal amount of the
Mortgage Loan shall be changed.

         Section 5.03 Right to Examine Servicer Records.

         The Owner shall have the right to examine and audit any and all of the
books, records, or other information of the Servicer, whether held by the
Servicer or by another on its behalf, with respect to or concerning this
Agreement or the Mortgage Loans, during business hours or at such other times as
may be reasonable under applicable circumstances, upon reasonable advance
notice.

         Section 5.04 Servicing Tape.

         Not later than the tenth calendar day of each month, the Servicer shall
deliver or cause to be delivered to the Owner and the Owner's designee, a file
in an electronic reporting format as shall be mutually agreed on by the Owner
and Servicer, containing servicing information, including without limitation,
those fields specified by the Owner from time to time and reasonably available
to the Servicer, on a loan-by-loan basis and in the aggregate, with respect to
the Mortgage Loans serviced hereunder.

         Section 5.05 Satisfaction of Mortgages and Release of Mortgage Files.

         Upon the payment in full of any Mortgage Loan the Servicer shall notify
the Owner in the Monthly Remittance Advice as provided in Section 4.02, and may
request the release of any Mortgage Loan documents. Upon receipt of such
request, the Custodian shall, within five (5) Business Days, release the related
Mortgage File to the Servicer; provided, that the Servicer shall use its best
efforts to obtain the release of the related Mortgage File from the Custodian.
The Custodian shall indemnify the Servicer out of its own funds for any loss,
liability

                                      -32-
<PAGE>

or expense incurred by the Servicer as a direct result of the failure of the
Custodian to release the related Mortgage File as provided in this paragraph.

         If the Servicer satisfies or releases a Mortgage without first having
obtained payment in full of the indebtedness secured by the Mortgage or should
the Servicer otherwise prejudice any rights the Owner may have under the
mortgage instruments, upon written demand of the Owner, the Servicer shall
repurchase the related Mortgage Loan at the Repurchase Price by deposit thereof
in the Custodial Account within 2 Business Days of receipt of such demand by the
Owner. The Servicer shall maintain the Fidelity Bond and Errors and Omissions
Insurance Policy as provided for in Section 3.14 insuring the Servicer against
any loss it may sustain with respect to any Mortgage Loan not satisfied in
accordance with the procedures set forth herein.

         Section 5.06 Annual Independent Public Accountants' Servicing Report.

         On or before July 31st of each year beginning July 31, 2000, the
Servicer, at its expense, shall cause a firm of independent public accountants
which is a member of the American Institute of Certified Public Accountants to
furnish a statement to each Owner stating that (i) it has obtained a letter of
representation regarding certain matters from the management of the Servicer
which includes an assertion that the Servicer has complied with certain minimum
residential mortgage loan servicing standards, identified in the Uniform Single
Attestation Program for Mortgage Bankers established by the Mortgage Bankers
Association of America, with respect to the servicing of residential mortgage
loans during the most recently completed fiscal year and (ii) on the basis of an
examination conducted by such firm in accordance with standards established by
the American Institute of Certified Public Accountants, such representation is
fairly stated in all material respects, subject to the exception and other
qualifications that may be appropriate.

                                      -33-
<PAGE>

                                   ARTICLE VI

                           REPRESENTATIONS, WARRANTIES
                                 AND AGREEMENTS

         Section 6.01 Representations, Warranties and Agreements of the
Servicer.

         The Servicer, as a condition to the consummation of the transactions
contemplated hereby, hereby makes the following representations and warranties
to the Owner as of each Closing Date:

         (a) Due Organization and Authority. The Servicer is a national banking
association duly organized, validly existing and in good standing under the laws
of the United States and has all licenses necessary to carry on its business as
now being conducted and is licensed, qualified and in good standing in each
state where a Mortgaged Property is located if the laws of such state require
licensing or qualification in order to conduct business of the type conducted by
the Servicer, and in any event the Servicer is in compliance with the laws of
any such state to the extent necessary to ensure the enforceability of the terms
of this Agreement; the Servicer has the full power and authority to execute and
deliver this Agreement and to perform in accordance herewith; the execution,
delivery and performance of this Agreement (including all instruments of
transfer to be delivered pursuant to this Agreement) by the Servicer and the
consummation of the transactions contemplated hereby have been duly and validly
authorized; this Agreement evidences the valid, binding and enforceable
obligation of the Servicer and all requisite action has been taken by the
Servicer to make this Agreement valid and binding upon the Servicer in
accordance with its terms;

         (b) Ordinary Course of Business. The consummation of the transactions
contemplated by this Agreement are in the ordinary course of business of the
Servicer;

         (c) No Conflicts. Neither the execution and delivery of this Agreement,
the acquisition of the servicing responsibilities by the Servicer or the
transactions contemplated hereby, nor the fulfillment of or compliance with the
terms and conditions of this Agreement, will conflict with or result in a breach
of any of the terms, conditions or provisions of the Servicer's charter or
by-laws or any legal restriction or any agreement or instrument to which the
Servicer is now a party or by which it is bound, or constitute a default or
result in an acceleration under any of the foregoing, or result in the violation
of any law, rule, regulation, order, judgment or decree to which the Servicer or
its property is subject, or impair the ability of the Servicer to service the
Mortgage Loans, or impair the value of the Mortgage Loans;

         (d) Ability to Perform. The Servicer does not believe, nor does it have
any reason or cause to believe, that it cannot perform each and every covenant
contained in this Agreement. The Servicer is solvent;

         (e) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or, to the Servicer's knowledge, threatened against the
Servicer which, either in any one instance or in the aggregate, may result in
any material adverse change in the business,

                                      -34-
<PAGE>

operations, financial condition, properties or assets of the Servicer, or in any
material impairment of the right or ability of the Servicer to carry on its
business substantially as now conducted, or in any material liability on the
part of the Servicer, or which would draw into question the validity of this
Agreement or of any action taken or to be taken in connection with the
obligations of the Servicer contemplated herein, or which would be likely to
impair materially the ability of the Servicer to perform under the terms of this
Agreement;

         (f) No Consent Required. No consent, approval, authorization or order
of any court or governmental agency or body is required for the execution,
delivery and performance by the Servicer of or compliance by the Servicer with
this Agreement, or if required, such approval has been obtained prior to each
Closing Date;

         (g) Ability to Service. The Servicer is an approved servicer of
conventional residential mortgage loans for Fannie Mae or Freddie Mac, with the
facilities, procedures, and experienced personnel necessary for the sound
servicing of mortgage loans of the same type as the Mortgage Loans. The Servicer
is in good standing to service mortgage loans for either Fannie Mae or Freddie
Mac, and no event has occurred, including but not limited to a change in
insurance coverage, which would make the Servicer unable to comply with either
Fannie Mae or Freddie Mac eligibility requirements or which would require
notification to Fannie Mae or Freddie Mac;

         (h) No Commissions to Third Parties. The Servicer has not dealt with
any broker or agent or anyone else who might be entitled to a fee or commission
in connection with this transaction other than the Owner;

         Section 6.02 Remedies for Breach of Representations and Warranties of
the Servicer.

         It is understood and agreed that the representations and warranties set
forth in Section 6.01 shall survive the engagement of the Servicer to perform
the servicing responsibilities as of each Closing Date and the delivery of the
Servicing Files to the Servicer and shall inure to the benefit of the Owner.
Upon discovery by either the Servicer or the Owner of a Breach of any of the
foregoing representations and warranties which materially and adversely affects
the ability of the Servicer to perform its duties and obligations under this
Agreement or otherwise materially and adversely affects the value of the
Mortgage Loans, the Mortgaged Property or the priority of the security interest
on such Mortgaged Property or the interest of the Owner (in the case of any of
the foregoing, a "Breach"), the party discovering such Breach shall give prompt
written notice to the other.

         Within 60 days of the earlier of either discovery by or notice to the
Servicer of any Breach of a representation or warranty set forth in Section 6.01
which materially and adversely affects the ability of the Servicer to perform
its duties and obligations under this Agreement or otherwise materially and
adversely affects the value of the Mortgage Loans, the Mortgaged Property or the
priority of the security interest on such Mortgaged Property, the Servicer shall
use its Best Efforts promptly to cure such Breach in all material respects and,
if such Breach cannot be cured, the Servicer shall, at the Owner's option,
assign the Servicer's rights and obligations under this Agreement (or respecting
the affected Mortgage Loans) to a

                                      -35-
<PAGE>

successor servicer, subject to the approval of the Owner, which approval shall
be in the Owner's sole discretion. Such assignment shall be made in accordance
with Section 10.01.

         In addition, the Servicer shall indemnify the Owner and hold it
harmless against any losses, damages, penalties, fines, forfeitures, reasonable
and necessary legal fees and related costs, judgments, and other costs and
expenses resulting from any claim, demand, defense or assertion based on or
grounded upon, or resulting from, a Breach of the Servicer representations and
warranties contained in this Agreement.

         Any cause of action against the Servicer relating to or arising out of
the Breach of any representations and warranties made in Section 6.01 shall
accrue upon (i) discovery of such Breach by the Servicer or notice thereof by
the Owner to the Servicer, (ii) failure by the Servicer to cure such Breach
within the applicable cure period, and (iii) demand upon the Servicer by the
Owner for compliance with this Agreement.

         Section 6.03 Representations and Warranties of the Owner.

         The Owner, as a condition to the consummation of the transactions
contemplated hereby, makes the following representations and warranties to the
Servicer as of each Closing Date:

         (a) Due Organization and Authority. The Owner is a North Carolina
corporation duly organized, validly existing and in good standing under the laws
of the state of its incorporation and has all licenses necessary to carry on its
business as now being conducted; the Owner has the full corporate power and
authority to execute and deliver this Agreement and to perform in accordance
herewith; the execution, delivery and performance of this Agreement (including
all instruments of transfer to be delivered pursuant to this Agreement) by the
Owner and the consummation of the transactions contemplated hereby have been
duly and validly authorized; this Agreement evidences the valid, binding and
enforceable obligation of the Owner; and all requisite corporate action has been
taken by the Owner to make this Agreement valid and binding upon the Owner in
accordance with its terms;

         (b) Ordinary Course of Business. The consummation of the transactions
contemplated by this Agreement are in the ordinary course of business of the
Owner;

         (c) No Conflicts. Neither the execution and delivery of this Agreement,
the conveyance of the servicing responsibilities to the Servicer or the
transactions contemplated hereby, nor the fulfillment of or compliance with the
terms and conditions of this Agreement, will conflict with or result in a Breach
of any of the terms, conditions or provisions of the Owner's charter or by-laws
or any legal restriction or any agreement or instrument to which the Owner is
now a party or by which it is bound, or constitute a default or result in an
acceleration under any of the foregoing, or result in the violation of any law,
rule, regulation, order, judgment or decree to which the Owner or its property
is subject, or impair the value of the servicing contract consummated hereby;

         (d) Ability to Perform. The Owner does not believe, nor does it have
any reason or cause to believe, that it cannot perform each and every covenant
contained in this Agreement;

                                      -36-
<PAGE>

         (e) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or threatened against the Owner which, either in any one
instance or in the aggregate, may result in any material adverse change in the
business, operations, financial condition, properties or assets of the Owner, or
in any material impairment of the right or ability of the Owner to carry on its
business substantially as now conducted, or in any material liability on the
part of the Owner, or which would draw into question the validity of this
Agreement or of any action taken or to be taken in connection with the
obligations of the Owner contemplated herein, or which would be likely to impair
materially the ability of the Owner to perform under the terms of this
Agreement;

         (f) No Consent Required. No consent, approval, authorization or order
of any court or governmental agency or body is required for the execution,
delivery and performance by the Owner of or compliance by the Owner with this
Agreement, or if required, such approval has been obtained prior to each Closing
Date;

         (g) Ownership. The Owner is the sole owner and holder of the Mortgage
Loans. The servicing responsibilities contracted for as of the relevant Closing
Date have not been assigned or pledged, and the Owner has good and marketable
interest therein, has full right to transfer the servicing responsibilities to
the Servicer free and clear of any encumbrance, equity, interest, lien, pledge,
charge, claim or security interest, and has full right and authority, subject to
no interest of, or agreement with, any other party (other than any notice
required by law, regulation or otherwise, to be delivered to the Mortgagors) to
assign the servicing responsibilities pursuant to this Agreement; and

         (h) No Commissions to Third Parties. The Owner has not dealt with any
broker or agent or anyone else who might be entitled to a fee or commission in
connection with this transaction other than the Servicer.

         Section 6.04 Remedies for Breach of Representations and Warranties of
the Owner.

         It is understood and agreed that the representations and warranties set
forth in Section 6.03 shall survive the engagement of the Servicer to perform
the servicing responsibilities as of the Closing Dates and the delivery of the
Servicing Files to the Servicer and shall inure to the benefit of the Servicer.
Upon discovery by either the Servicer or the Owner of a Breach of any of the
foregoing representations and warranties which materially and adversely affects
the value of the servicing contract established herein or the interest of the
Servicer, the party discovering such Breach shall give prompt written notice to
the other.

         Within 60 days of the earlier of either discovery by or notice to the
Owner of any Breach of a representation or warranty set forth in Section 6.03
which materially and adversely affects the value of the servicing contract, the
Owner shall use its Best Efforts promptly to cure such Breach in all material
respects.

         The Owner shall indemnify the Servicer and hold it harmless against any
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal
fees and related costs, judgments, and other costs and expenses, including,
without limitation, any reasonable legal fees

                                      -37-
<PAGE>

and related expenses incurred by the Owner in connection with enforcing this
indemnity, resulting from any claim, demand, defense or assertion based on or
grounded upon, or resulting from, a Breach of the Owner representations and
warranties contained in this Agreement. It is understood and agreed that the
obligation of the Owner to indemnify the Servicer pursuant to this Section 6.04
constitutes the sole remedy of the Servicer respecting a Breach of the foregoing
representation and warranties.

         Any cause of action against the Owner relating to or arising out of the
Breach of any representations and warranties made in Section 6.03 shall accrue
upon (i) discovery of such Breach by the Owner or notice thereof by the Servicer
to the Owner, (ii) failure by the Owner to cure such Breach within the
applicable cure period, and (iii) demand upon the Owner by the Servicer for
compliance with this Agreement.

                                      -38-
<PAGE>

                                   ARTICLE VII

                   WHOLE LOAN TRANSFER; PASS-THROUGH TRANSFER

         Section 7.01 Removal of Mortgage Loans from Inclusion Under this
Agreement Upon a Pass-Through Transfer or a Whole Loan Transfer on One or More
Reconstitution Dates.

         (a) The Owner and the Servicer agree that with respect to some or all
of the Mortgage Loans, from time to time the Owner shall:

         1. Effect a Whole Loan Transfer, and/or

         2. Effect a Pass-Through Transfer,

         in each case retaining the Servicer as the servicer thereof, or as
applicable the "seller/servicer". On the related Reconstitution Date, the
Mortgage Loans transferred shall cease to be covered by this Agreement.

         (b) With respect to each Whole Loan Transfer or Pass-Through Transfer,
as the case may be, entered into by the Owner, the Servicer agrees to cooperate
fully with the Owner, the Owner's designee, any prospective purchaser, or any
rating agency with respect to all reasonable requests and due diligence
procedures and to use its Best Efforts to facilitate such Whole Loan Transfer or
Pass-Through Transfer, as the case may be.

         (c) The Servicer acknowledges that with respect to some or all of the
Mortgage Loans, the Owner intends to effect one or more Whole Loan Transfers
and/or one or more Pass-Through Transfers. With respect to each Whole Loan
Transfer or Pass-Through Transfer, as the case may be, entered into by the
Owner, the Servicer agrees:

         (i) to negotiate and to execute all agreements executed in connection
    with such Whole Loan Transfer or Pass-Through Transfer that govern the
    servicing and administration of the Mortgage Loans (and any agreements and
    other documents incidental thereto) as the Owner shall reasonably request,
    provided that the servicing provisions contained therein shall be
    substantially similar to those contained in this Agreement and shall not
    contain any obligations materially more onerous than those contained herein
    that increase the expenses or obligations of the Servicer, unless otherwise
    mutually agreed by the parties (provided, that each of the Servicer and the
    Owner is given an opportunity to review and reasonably negotiate in good
    faith the content of such documents not specifically referenced or provided
    herein), which governing documents, in the case of a Pass-Through Transfer,
    shall contain provisions customarily included in publicly issued or
    privately placed rated secondary mortgage market transactions;

         (ii) to cooperate fully with the Owner and any prospective purchaser,
    at the Owner's expense, with respect to all reasonable requests and due
    diligence procedures including participating in meetings with rating
    agencies, bond insurers and such other

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    parties as the Owner shall designate and participating in meetings with
    prospective purchasers of the Mortgage Loans or interests therein and
    providing information contained in the Mortgage Loan Schedule including any
    diskette or other related data tapes provided as reasonably requested by
    such purchasers;

         (iii) to negotiate and execute one or more master servicing agreements
    between the Servicer and any third party servicer which is servicing loans
    on behalf of the Owner providing for such third party servicer to master
    service such Mortgage Loans on behalf of the Owner;

         (iv) to negotiate and execute one or more subservicing agreements
    between the Servicer and any master servicer which is generally considered
    to be a prudent master servicer in the secondary mortgage market designated
    by the Owner in its sole discretion after consultation with the Servicer
    and/or one or more custodial and servicing agreements among the Owner or an
    affiliate of the Owner, the Servicer and a third party custodian/trustee
    which is generally considered to be a prudent custodian/trustee in the
    secondary mortgage market designated by the Owner in its sole discretion
    after consultation with the Servicer, in either case for the purpose of
    pooling the Mortgage Loans with other mortgage loans for resale or
    securitization;

         (v) in connection with a Pass-Through Transfer, a Whole Loan Transfer,
    or any securitization of any Mortgage Loans, to negotiate and execute a
    pooling and servicing agreement, which pooling and servicing agreement may,
    at the Owner's direction, contain contractual provisions including, but not
    limited to, a 24-day certificate payment delay (54-day total payment delay),
    servicer advances of delinquent scheduled payments of principal and interest
    through liquidation (unless deemed non-recoverable) and payment of
    compensating interest with respect to prepayment interest shortfalls (to the
    extent of the monthly servicing fee payable thereto), servicing
    representations and warranties which in form and substance conform to
    secondary market standards for securities backed by mortgage loans similar
    to the Mortgage Loans, and such provisions with regard to servicing
    responsibilities, investor reporting, segregation and deposit of principal
    and interest payments, custody of the Mortgage Loans, and other covenants as
    are required by the Owner and one or more nationally recognized rating
    agencies for "AAA" rated mortgage pass-through transactions which are
    "mortgage related securities" for purposes of the Secondary Mortgage Market
    Enhancement Act of 1984, unless otherwise mutually agreed;

         (vi) to deliver to the Owner and to any Person designated by the Owner
    (a) for inclusion in any prospectus or other offering material such publicly
    available information regarding the Servicer, its financial condition and
    its mortgage loan delinquency, foreclosure and loss experience and any
    additional information requested by the Owner, (b) any similar non-public,
    unaudited financial information (which the Owner may, at its option and at
    its cost, have audited by certified public accountants) and such other
    information as is reasonably requested by the Owner and which the Servicer
    is capable of providing without unreasonable effort or expense, and to
    indemnify the Owner and its affiliates for material misstatements contained
    in such information, and (c) such

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<PAGE>

    statements and audit letters of reputable, certified public accountants
    pertaining to information provided by the Servicer pursuant to clause (a)
    above as shall be reasonably requested by the Owner; and

         (vii) to deliver to the Owner, and to any Person designated by the
    Owner, such legal documents and opinions of counsel (which may be in-house
    opinions of counsel) in a form reasonably acceptable to the Owner as are
    customarily delivered and reasonably determined by the Owner to be necessary
    in connection with Whole Loan Transfers or Pass-Through Transfers, as the
    case may be, it being understood that the cost of any opinions of outside
    special counsel that may be required for a Whole Loan Transfer or
    Pass-Through Transfer, as the case may be, shall be the responsibility of
    the Owner.

         (d) The Servicer shall provide to the Owner or issuer, as the case may
be, and any other participants in such Whole Loan Transfer or Pass-Through
Transfer, any and all information with respect to itself, its servicing
portfolio or the Mortgage Loans and appropriate verification of information
which may be reasonably available to the Servicer, whether through letters of
its auditors and counsel or otherwise, as the Owner or any such other
participant shall request upon reasonable demand.

         (e) In the event the Owner has elected to have the Servicer hold record
title to the Mortgages, prior to a Reconstitution Date the Owner or its designee
shall prepare an Assignment of Mortgage in blank from the Owner, acceptable to
the trustee or such third party, as the case may be, for each Mortgage Loan that
is part of a Whole Loan Transfer or Pass-Through Transfer and shall pay all
preparation and recording costs associated therewith. The Servicer shall execute
each Assignment of Mortgage, track such Assignments of Mortgage to ensure they
have been recorded and deliver them as required by the trustee or such third
party, as the case may be, upon the Servicer's receipt thereof. Additionally,
the Servicer shall prepare and execute, at the direction and expense of the
Owner, any note endorsements in connection with any and all Reconstitution
Agreements; provided that the Servicer shall be responsible for the expenses
with respect to the initial endorsements.

         (f) All Mortgage Loans not sold or transferred pursuant to a
Pass-Through Transfer or Whole Loan Transfer and any and all Mortgage Loans
repurchased by the Owner pursuant to Section 7.02 below with respect to a
Pass-Through Transfer or Whole Loan Transfer shall be subject to this Agreement
and shall continue to be serviced in accordance with the terms of this Agreement
and with respect thereto this Agreement shall remain in full force and effect.

         Section 7.02 Owner's Repurchase and Indemnification Obligations.

         Upon receipt by the Servicer of notice from the trustee of a Breach of
any Owner representation or warranty contained in any Reconstitution Agreement
or a request by the trustee for the repurchase of any Mortgage Loan transferred
to a trustee pursuant to a Pass-Through Transfer or to a third party purchaser
pursuant to a Whole Loan Transfer, the Servicer shall promptly notify the Owner
of same and shall, at the direction of the Owner, use its Best Efforts to cure
and correct any such Breach and to satisfy the requests or concerns of the
trustee or the third party purchaser related to such deficiencies of the related
Mortgage Loans transferred to the trustee or other such third party purchaser.

                                      -41-
<PAGE>

         The Owner shall repurchase from the Servicer any Mortgage Loan
transferred to a trustee pursuant to a Pass-Through Transfer or to a third party
purchaser pursuant to a Whole Loan Transfer with respect to which the Servicer
has been required by the trustee or such third party purchaser to repurchase due
to a Breach of a representation or warranty made by the Owner with respect to
the Mortgage Loans, or the servicing thereof prior to the transfer date to the
trustee or any third party purchaser in any Reconstitution Agreement and not due
to a breach of the Servicer's obligations thereunder or pursuant to this
Agreement. The repurchase price to be paid by the Owner to the Servicer shall
equal that repurchase price paid by the Servicer to the third party purchaser
plus all reasonable costs and expenses borne by the Servicer in connection with
the cure of said Breach of a representation or warranty made by the Owner and in
connection with the repurchase of such Mortgage Loan from the trustee or the
third party purchaser, including, but not limited to, reasonable and necessary
attorneys' fees.

         At the time of repurchase, the Custodian and the Servicer shall arrange
for the reassignment of the repurchased Mortgage Loan to the Owner according to
the Owner's instructions and the delivery to the Custodian of any documents held
by the trustee or other relevant third party purchaser with respect to the
repurchased Mortgage Loan pursuant to the related Reconstitution Agreement. In
the event of a repurchase, the Servicer shall, simultaneously with such
reassignment, give written notice to the Owner that such repurchase has taken
place, and amend the Mortgage Loan Schedule to reflect the addition of the
repurchased Mortgage Loan to this Agreement. In connection with any such
addition, the Servicer and the Owner shall be deemed to have made as to such
repurchased Mortgage Loan the representations and warranties set forth in this
Agreement except that all such representations and warranties set forth in this
Agreement shall be deemed made as of the date of such repurchase.

         Section 7.03 Indemnification; Third Party Claims.

         The Servicer shall indemnify the Owner and hold it harmless against any
and all claims, losses, damages, penalties, fines, forfeitures, reasonable and
necessary legal fees and related costs, judgments, and any other costs, fees and
expenses that the Owner may sustain in any way related to the failure of the
Servicer to perform its duties and service the Mortgage Loans in strict
compliance with the terms of this Agreement or any Reconstitution Agreement
entered into pursuant to Section 7.01. The Servicer immediately shall notify the
Owner if a claim is made by a third party with respect to this Agreement or any
Reconstitution Agreement or the Mortgage Loans, shall promptly notify Fannie
Mae, Freddie Mac, or the trustee with respect to any claim made by a third party
with respect to any Reconstitution Agreement, assume (with the prior written
consent of the Owner) the defense of any such claim and pay all expenses in
connection therewith, including counsel fees, and promptly pay, discharge and
satisfy any judgment or decree which may be entered against it or the Owner in
respect of such claim. The Servicer shall follow any written instructions
received from the Owner in connection with such claim. The Owner promptly shall
reimburse the Servicer for all amounts advanced by it pursuant to the preceding
sentence except when the claim is in any way related to the Servicer's
indemnification pursuant to Section 6.02, or the failure of the Servicer to
service and administer the Mortgage Loans in strict compliance with the terms of
this Agreement or any Reconstitution Agreement.

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<PAGE>

         The Owner shall indemnify the Servicer and hold it harmless against any
and all claims, losses, damages, penalties, fines, forfeitures, reasonable and
necessary legal fees and related costs, judgments, and any other costs, fees and
expenses that the Servicer may sustain in any way related to the failure of the
Owner to perform its duties in compliance with the terms of this Agreement or
any Reconstitution Agreement entered into pursuant to Section 7.01.

                                      -43-
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                                  ARTICLE VIII

                                  THE SERVICER

         Section 8.01 Merger or Consolidation of the Servicer.

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

         Any Person into which the Servicer may be merged or consolidated, or
any Person resulting from any merger, conversion or consolidation to which the
Servicer shall be a party, or any Person succeeding to the business of the
Servicer, shall be the successor of the Servicer hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding, provided,
however, that the successor or surviving Person shall be an institution (i)
having a net worth of not less than $25,000,000, and (ii) which is a Fannie Mae-
and Freddie Mac-approved servicer in good standing.

         Section 8.02 Limitation on Liability of the Servicer and Others.

         Neither the Servicer nor any of the directors, officers, employees or
agents of the Servicer shall be under any liability to the Owner for any action
taken or for refraining from the taking of any action in good faith pursuant to
this Agreement, or for errors in judgment, provided, however, that this
provision shall not protect the Servicer or any such person against any Breach
of warranties or representations made herein, or failure to perform its
obligations in strict compliance with any standard of care set forth in this
Agreement, or any liability which would otherwise be imposed by reason of any
breach of the terms and conditions of this Agreement. The Servicer and any
director, officer, employee or agent of the Servicer may rely in good faith on
any document of any kind prima facie properly executed and submitted by any
Person respecting any matters arising hereunder. The Servicer shall not be under
any obligation to appear in, prosecute or defend any legal action which is not
incidental to its duties to service the Mortgage Loans in accordance with this
Agreement and which in its opinion may involve it in any expense or liability,
provided, however, that the Servicer may, with the consent of the Owner,
undertake any such action which it may deem necessary or desirable in respect to
this Agreement and the rights and duties of the parties hereto. In such event,
the Servicer shall be entitled to reimbursement from the Owner of the reasonable
legal expenses and costs of such action.

         Section 8.03 Limitation on Resignation and Assignment by Servicer.

         The Owner has entered into this Agreement with the Servicer and
subsequent Owners will purchase the Mortgage Loans in reliance upon the
independent status of the Servicer, and the representations as to the adequacy
of its servicing facilities, plant, personnel, records and

                                      -44-
<PAGE>

procedures, its integrity, reputation and financial standing, and the
continuance thereof. Therefore, the Servicer shall neither assign this Agreement
or the servicing hereunder or delegate its rights or duties hereunder or any
portion hereof (to other than a third party in the case of outsourcing routine
tasks such as taxes, insurance and property inspection, in which case the
Servicer shall be fully liable for such tasks as if the Servicer performed them
itself) or sell or otherwise dispose of all or substantially all of its property
or assets without the prior written consent of the Owner, which consent shall be
granted or withheld in the reasonable discretion of the Owner, provided,
however, that the Servicer may assign its rights and obligations hereunder
without prior written consent of the Owner to any entity that is directly owned
or controlled by the Servicer, and the Servicer guarantees the performance of
such entity hereunder. In the event of such assignment by the Servicer, the
Servicer shall provide the Owner with a written statement guaranteeing the
successor entity's performance of the Servicer's obligations under the
Agreement.

         The Servicer shall not resign from the obligations and duties hereby
imposed on it except by mutual consent of the Servicer and the Owner or upon the
determination that its duties hereunder are no longer permissible under
applicable law and such incapacity cannot be cured by the Servicer. Any such
determination permitting the resignation of the Servicer shall be evidenced by
an Opinion of Counsel to such effect delivered to the Owner which Opinion of
Counsel shall be in form and substance acceptable to the Owner. No such
resignation shall become effective until a successor shall have assumed the
Servicer's responsibilities and obligations hereunder in the manner provided in
Section 10.01.

         Without in any way limiting the generality of this Section 8.03, in the
event that the Servicer either shall assign this Agreement or the servicing
responsibilities hereunder or delegate its duties hereunder or any portion
thereof (to other than a third party in the case of outsourcing routine tasks
such as taxes, insurance and property inspection, in which case the Servicer
shall be fully liable for such tasks as if the Servicer performed them itself)
or sell or otherwise dispose of all or substantially all of its property or
assets, without the prior written consent of the Owner, then the Owner shall
have the right to terminate this Agreement upon notice given as set forth in
Section 9.01 without any payment of any penalty or damages and without any
liability whatsoever to the Servicer or any third party.

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                                   ARTICLE IX

                                   TERMINATION

         Section 9.01 Termination for Cause.

         This Agreement shall be terminable at the sole option of the Owner, if
any of the following events of default exist on the part of the Servicer:

         (i) any failure by the Servicer to remit to the Owner any payment
required to be made under the terms of this Agreement which continues unremedied
for a period of five days after the date upon which written notice of such
failure, requiring the same to be remedied, shall have been given to the
Servicer by the Owner; or

         (ii) failure by the Servicer duly to observe or perform in any material
respect any other of the covenants or agreements on the part of the Servicer set
forth in this Agreement which continues unremedied for a period of 30 days after
the date on which written notice of such failure, requiring the same to be
remedied, shall have been given to the Servicer by the Owner; or

         (iii) failure by the Servicer to maintain its license to do business in
any jurisdiction where the Mortgaged Property is located; or

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

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

         (vi) the Servicer shall admit in writing its inability to pay its debts
generally as they become due, file a petition to take advantage of any
applicable insolvency, bankruptcy or reorganization statute, make an assignment
for the benefit of its creditors, voluntarily suspend payment of its obligations
or cease its normal business operations for three Business Days; or

         (vii) the Servicer ceases to meet the qualifications of a Fannie Mae or
Freddie Mac servicer; or

         (viii) the Servicer fails to maintain a minimum net worth of
$25,000,000; or

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<PAGE>

         (ix) the Servicer attempts to assign its right to servicing
compensation hereunder or the Servicer attempts, without the consent of the
Owner, to sell or otherwise dispose of all or substantially all of its property
or assets or to assign this Agreement or the servicing responsibilities
hereunder or to delegate its duties hereunder or any portion thereof (to other
than a third party in the case of outsourcing routine tasks such as taxes,
insurance and property inspection, in which case the Servicer shall be fully
liable for such tasks as if the Servicer performed them itself) in violation of
Section 8.03.

         In each and every such case, so long as an event of default shall not
have been remedied, in addition to whatsoever rights the Owner may have at law
or equity to damages, including injunctive relief and specific performance, the
Owner, by notice in writing to the Servicer, may terminate all the rights and
obligations of the Servicer under this Agreement and in and to the servicing
contract established hereby and the proceeds thereof.

         Upon receipt by the Servicer of such written notice, all authority and
power of the Servicer under this Agreement, whether with respect to the Mortgage
Loans or otherwise, shall pass to and be vested in a successor servicer
appointed by the Owner. Upon written request from the Owner, the Servicer shall
prepare, execute and deliver to the successor entity designated by the Owner any
and all documents and other instruments, place in such successor's possession
all Servicing Files, and do or cause to be done all other acts or things
necessary or appropriate to effect the purposes of such notice of termination,
including but not limited to the transfer and endorsement or assignment of the
Mortgage Loans and related documents, at the Servicer's sole expense. The
Servicer shall cooperate with the Owner and such successor in effecting the
termination of the Servicer's responsibilities and rights hereunder, including
without limitation, the transfer to such successor for administration by it of
all cash amounts which shall at the time be credited by the Servicer to the
Custodial Account or Escrow Account or thereafter received with respect to the
Mortgage Loans.

         By a written notice, the Owner may waive any default by the Servicer in
the performance of its obligations hereunder and its consequences. Upon any
waiver of a past default, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been remedied for every
purpose of this Agreement. No such waiver shall extend to any subsequent or
other default or impair any right consequent thereon except to the extent
expressly so waived.

         Section 9.02 Termination Without Cause.

         This Agreement shall terminate upon: (i) the later of (a) the
distribution of the final payment or liquidation proceeds on the last Mortgage
Loan to the Owner (or advances by the Servicer for the same), and (b) the
disposition of all REO Property acquired upon foreclosure of the last Mortgage
Loan and the remittance of all funds due hereunder, or (ii) mutual consent of
the Servicer and the Owner in writing or (iii) at the sole option of the Owner,
without cause, upon 30 days written notice. Any such notice of termination shall
be in writing and delivered to the Servicer by registered mail to the address
set forth at the beginning of this Agreement. The Owner and the Servicer shall
comply with the termination procedures set forth in Sections 10.01 and 10.03
hereof and the procedures set forth below, provided that, in the event the Owner

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terminates this Agreement without cause in accordance with subclause (iii)
above, the Owner shall pay the Servicer a termination fee equal to (A) with
respect to fixed rate Mortgage Loans, 2.0% of the aggregate unpaid principal
balance of the fixed rate Mortgage Loans as of such termination date and (B)
with respect to ARM Mortgage Loans, 2.0% of the aggregate unpaid principal
balance of the ARM Mortgage Loans as of such termination date.

         In connection with any such termination referred to in clause (ii) or
(iii) above, the Owner will be responsible for reimbursing the Servicer for all
unreimbursed out-of-pocket Servicing Advances within 15 Business Days following
the date of termination and other reasonable and necessary out-of-pocket costs
associated with any transfer of servicing.

         Notwithstanding and in addition to the foregoing, in the event that (i)
a Mortgage Loan becomes delinquent for a period of 90 days or more (a
"Delinquent Mortgage Loan") or (ii) a Mortgage Loan becomes an REO Property, the
Owner may at its election terminate this Agreement (a) with respect to such
Delinquent Mortgage Loan or (b) REO Property, in each case, upon 15 days'
written notice to the Servicer. In the event of such election, the Owner shall
reimburse the Servicer for all unreimbursed out-of-pocket Servicing Advances and
Monthly Advances on the date of termination and other reasonable and necessary
out-of-pocket costs associated with any transfer of servicing, including, but
not limited to, costs associated with the transfer of the related files to the
Owner's designee.

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                                    ARTICLE X

                            MISCELLANEOUS PROVISIONS

         Section 10.01 Successor to the Servicer.

         Simultaneously with the termination of the Servicer's responsibilities
and duties under this Agreement pursuant to Sections 6.02, 7.03, 8.03, 9.01 or
9.02, the Owner shall (i) succeed to and assume all of the Servicer's
responsibilities, rights, duties and obligations under this Agreement, or (ii)
appoint a successor having the characteristics set forth in clauses (i) and (ii)
of Section 8.01 and which shall succeed to all rights and assume all of the
responsibilities, duties and liabilities of the Servicer under this Agreement
simultaneously with the termination of the Servicer's responsibilities, duties
and liabilities under this Agreement. In connection with such appointment and
assumption, the Owner may make such arrangements for the compensation of such
successor out of payments on Mortgage Loans as it and such successor shall
agree, provided, however, that no such compensation shall be in excess of that
permitted the Servicer under this Agreement without the consent of the Owner. In
the event that the Servicer's duties, responsibilities and liabilities under
this Agreement should be terminated pursuant to the aforementioned sections, the
Servicer shall discharge such duties and responsibilities during the period from
the date it acquires knowledge of such termination until the effective date
thereof with the same degree of diligence and prudence which it is obligated to
exercise under this Agreement, and shall take no action whatsoever that might
impair or prejudice the rights or financial condition of its successor. The
resignation or removal of the Servicer pursuant to the aforementioned sections
shall not become effective until a successor shall be appointed pursuant to this
Section 10.01 and shall in no event relieve the Servicer of the representations
and warranties made pursuant to Sections 6.01 and the remedies available to the
Owner under Section 6.02 and 7.03, it being understood and agreed that the
provisions of such Sections 6.01, 6.02 and 7.03 shall be applicable to the
Servicer notwithstanding any such resignation or termination of the Servicer, or
the termination of this Agreement.

         Within 30 days of the appointment of a successor entity by the Owner,
the Servicer shall prepare, execute and deliver to the successor entity any and
all documents and other instruments, place in such successor's possession all
Servicing Files, and do or cause to be done all other acts or things necessary
or appropriate to effect the purposes of such notice of termination, including
but not limited to the transfer and endorsement of the Mortgage Notes and
related documents, and the preparation and recordation of Assignments of
Mortgage, at the discretion of the Owner and, at the Owner's sole expense. The
Servicer shall cooperate with the Owner and such successor in effecting the
termination of the Servicer's responsibilities and rights hereunder and the
transfer of servicing responsibilities to the successor servicer, including
without limitation, the transfer to such successor for administration by it of
all cash amounts which shall at the time be credited by the Servicer to the
Custodial Account or Escrow Account or thereafter received with respect to the
Mortgage Loans.

         Any successor appointed as provided herein shall execute, acknowledge
and deliver to the Servicer and to the Owner an instrument accepting such
appointment, wherein the

                                      -49-
<PAGE>

successor shall make the representations and warranties set forth in Section
6.01, whereupon such successor shall become fully vested with all the rights,
powers, duties, responsibilities, obligations and liabilities of the Servicer,
with like effect as if originally named as a party to this Agreement. Any
termination or resignation of the Servicer or termination of this Agreement
pursuant to Sections 6.02, 7.03, 8.03, 9.01 or 9.02 shall not affect any claims
that the Owner may have against the Servicer arising out of the Servicer's
actions or failure to act prior to any such termination or resignation.

         The Servicer shall deliver promptly to the successor servicer the funds
in the Custodial Account and Escrow Account and all Mortgage Loan documents and
related documents and statements held by it hereunder and the Servicer shall
account for all funds and shall execute and deliver such instruments and do such
other things as may reasonably be required to more fully and definitively vest
in the successor all such rights, powers, duties, responsibilities, obligations
and liabilities of the Servicer.

         Upon a successor's acceptance of appointment as such, the Servicer
shall notify by mail the Owner of such appointment in accordance with the
procedures set forth in Section 10.07.

         Section 10.02 Closing.

         Each closing for the engagement of the Servicer to perform the
servicing responsibilities respecting Mortgage Loans shall take place on the
related Closing Date. At the Owner's option, the closing shall be either: by
telephone, confirmed by letter or wire as the parties shall agree; or conducted
in person, at such place as the parties shall agree.

         Each closing shall be subject to each of the following conditions:

         (a) all of the representations and warranties of the Servicer and the
Owner under this Agreement shall be true and correct as of each Closing Date and
no event shall have occurred which, with notice or the passage of time, would
constitute a default under this Agreement;

         (b) the Owner and Servicer each shall have received, or the Owner's
attorneys shall have received in escrow, (i) with respect to the first Closing
Date, all Closing Documents as specified in Section 10.03(a) hereof, and (ii)
with respect to all subsequent Closing Dates, the Closing Documents specified in
Section 10.03(b) hereof, in such forms as are agreed upon and acceptable to the
Servicer and the Owner, duly executed by all signatories other than the Owner as
required pursuant to the respective terms thereof; and

         (c) all other terms and conditions of this Agreement shall have been
complied with and no default or Event of Default under this Agreement shall have
occurred and be continuing for a period of 30 days or more prior to the related
Closing Date.

                                      -50-
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         Section 10.03 Closing Documents.

         The Closing Documents shall consist of fully executed originals of the
following documents:

    (a)  with respect to the initial Closing Date,

         (i) this Agreement;

         (ii) the Mortgage Loan Schedule, with one copy to be attached to each
    counterpart of this Agreement as Exhibit A, and with respect to subsequent
    Closing Dates, a Mortgage Loan Schedule reflecting the additional Mortgage
    Loans to be serviced by the Servicer and a cumulative Mortgage Loan
    Schedule, reflecting all Mortgage Loans being serviced by the Servicer from
    the initial Closing Date up to, and including, the related subsequent
    Closing Date;

         (iii) an Acknowledgment Agreement in the form of Exhibit B hereto;

         (iv) an Assignment and Assumption Agreement in the form of Exhibit I
    hereto;

         (v) an Assignment and Assumption Agreement in the form of Exhibit J
    hereto;

         (vi) a Custodial Account Letter Agreement in the form of Exhibit C
    hereto;

         (vii) an Escrow Account Letter Agreement in the form of Exhibit D
    hereto;

         (viii) an Officer's Certificate of the Servicer, in the form of Exhibit
    E-1 hereto, including all attachments thereto, and with respect to
    subsequent Closing Dates, an Officer's Certificate in the form of Exhibit
    E-2 hereto, including all attachments thereto; and

         (ix) an Opinion of Counsel of the Servicer in the form of Exhibit G
    hereto.

    (b)  with respect to each subsequent Closing Date,

         (i) an Acknowledgment Agreement in the form of Exhibit B hereto;

         (ii) an Assignment and Assumption Agreement in the form of Exhibit I
    hereto; and

         (iii) an Assignment and Assumption Agreement in the form of Exhibit J
    hereto;

                                      -51-
<PAGE>

         Section 10.04 Appointment and Designation of Master Servicer.

         The Owner hereby appoints and designates Aurora Loan Services, Inc. as
its master servicer (the "Master Servicer") for the Mortgage Loans subject to
this Agreement. The Servicer is hereby authorized and instructed to take any and
all instructions with respect to servicing the Mortgage Loans hereunder as if
the Master Servicer were the Owner hereunder. The authorization and instruction
set forth herein shall remain in effect until such time as the Servicer shall
receive written instruction from the Owner that such authorization and
instruction is terminated.

         Section 10.05 Costs.

         The Owner shall pay any commissions due its salesmen and the legal fees
and expenses of its attorneys. After the initial Assignments of Mortgage have
been prepared and recorded, the Owner shall pay the costs associated with the
preparation, endorsement, delivery and recording of Assignments of Mortgages.

         Section 10.06 Protection of Confidential Information.

         The Servicer shall keep confidential and shall not divulge to any
party, without the Owner's prior written consent, the purchase price paid by the
Owner for the Mortgage Loans and any information pertaining to the Mortgage
Loans or any borrower thereunder, except to the extent that it is appropriate
for the Servicer to do so in working with legal counsel, auditors, taxing
authorities or other governmental agencies.

         Section 10.07 Notices.

         All demands, notices and communications hereunder shall be in writing
and shall be deemed to have been duly given if mailed by overnight courier,
addressed as follows (or such other address as may hereafter be furnished to the
other party by like notice):

         (i)  if to the Owner:

              Centre Capital Group, Inc.
              200 Pringle Avenue
              Suite 500
              Walnut Creek, CA 94596]

              Attention: Peter Hills

         (ii) if to the Servicer:

              Bank of America, N.A.
              2810 North Parham Road
              Richmond VA  23294-4400

                                      -52-
<PAGE>

              Attention: Servicing Manager

         Any such demand, notice or communication hereunder shall be deemed to
have been received on the date delivered to or received at the premises of the
addressee.

         Section 10.08 Severability Clause.

         Any part, provision, representation or warranty of this Agreement which
is prohibited or which is held to be void or unenforceable shall be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof. Any part, provision, representation or warranty of
this Agreement which is prohibited or unenforceable or is held to be void or
unenforceable in any jurisdiction shall be ineffective, as to such jurisdiction,
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction as to any Mortgage Loan shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent permitted
by applicable law, the parties hereto waive any provision of law which prohibits
or renders void or unenforceable any provision hereof. If the invalidity of any
part, provision, representation or warranty of this Agreement shall deprive any
party of the economic benefit intended to be conferred by this Agreement, the
parties shall negotiate, in good-faith, to develop a structure the economic
effect of which is as close as possible to the economic effect of this Agreement
without regard to such invalidity.

         Section 10.09 No Personal Solicitation.

         From and after each related Closing Date, the Servicer hereby agrees
that it will not take any action or permit or cause any action to be taken by
any of its agents or affiliates, or by any independent contractors or
independent mortgage brokerage companies on the Servicer's behalf, to
personally, by telephone or mail, solicit the Mortgagor under any Mortgage Loan
for the purpose of refinancing such Mortgage Loan; provided, that the Servicer
may solicit any Mortgagor for whom the Servicer has received a request for
verification of mortgage, a request for demand for payoff, a mortgagor initiated
written or verbal communication indicating a desire to prepay the related
Mortgage Loan, or the mortgagor initiates a title search, provided further, it
is understood and agreed that promotions undertaken by the Servicer or any of
its affiliates which (i) concern optional insurance products or other additional
projects or (ii) are directed to the general public at large, including, without
limitation, mass mailings based on commercially acquired mailing lists,
newspaper, radio and television advertisements shall not constitute solicitation
under this Section 10.09 nor is the Servicer prohibited from responding to
unsolicited requests or inquiries made by a Mortgagor or an agent of a
Mortgagor. Notwithstanding the foregoing, the following solicitations, if
undertaken by the Servicer or any affiliate of the Servicer, shall not be
prohibited under this Section 10.09: (i) solicitations that are directed to the
general public at large, including, without limitation, mass mailings based on
commercially acquired mailing lists and newspaper, radio, television and other
mass media advertisements; (ii) borrower messages included on, and statement
inserts provided with, the monthly statements sent to Mortgagors; provided,
however, that similar messages and inserts are sent to the borrowers of other
mortgage loans serviced by the Servicer.

                                      -53-
<PAGE>

         Section 10.10 Counterparts.

         This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original, and all such
counterparts shall constitute one and the same instrument.

         Section 10.11 Place of Delivery and Governing Law.

         THIS AGREEMENT SHALL BE DEEMED IN EFFECT WHEN A FULLY EXECUTED
COUNTERPART THEREOF IS RECEIVED BY THE OWNER IN THE STATE OF NEW YORK AND SHALL
BE DEEMED TO HAVE BEEN MADE IN THE STATE OF NEW YORK. THE AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, EXCEPT TO THE EXTENT
PREEMPTED BY FEDERAL LAW.

         Section 10.12 Further Agreements.

         The Owner and the Servicer each agree to execute and deliver to the
other such reasonable and appropriate additional documents, instruments or
agreements as may be necessary or appropriate to effectuate the purposes of this
Agreement.

         Section 10.13 Intention of the Parties.

         It is the intention of the parties that the Owner is conveying, and the
Servicer is receiving only a contract for servicing the Mortgage Loans.
Accordingly, the parties hereby acknowledge that the Owner remains the sole and
absolute owner of the Mortgage Loans and all rights related thereto.

         Section 10.14 Successors and Assigns; Assignment of Agreement.

         This Agreement shall bind and inure to the benefit of and be
enforceable by the Servicer and the Owner and the respective successors and
assigns of the Servicer and the Owner. This Agreement shall not be assigned,
pledged or hypothecated by the Servicer to a third party without the prior
written consent of the Owner, which consent shall be given at the sole
discretion of the Owner.

         Section 10.15 Waivers.

         No term or provision of this Agreement may be waived or modified unless
such waiver or modification is in writing and signed by the party against whom
such waiver or modification is sought to be enforced.

         Section 10.16 Exhibits.

         The exhibits to this Agreement are hereby incorporated and made a part
hereof and are an integral part of this Agreement.

                                      -54-
<PAGE>

         Section 10.17 General Interpretive Principles.

         For purposes of this Agreement, except as otherwise expressly provided
or unless the context otherwise requires:

         (a) the terms defined in this Agreement have the meanings assigned to
them in this Agreement and include the plural as well as the singular, and the
use of any gender herein shall be deemed to include the other gender;

         (b) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles;

         (c) references herein to "Articles", "Sections", "Subsections",
"Paragraphs", and other subdivisions without reference to a document are to
designated Articles, Sections, Subsections, Paragraphs and other subdivisions of
this Agreement;

         (d) a reference to a Subsection without further reference to a Section
is a reference to such Subsection as contained in the same Section in which the
reference appears, and this rule shall also apply to Paragraphs and other
subdivisions;

         (e) the words "herein", "hereof", "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
provision; and

         (f) the term "include" or "including" shall mean by reason of
enumeration.

         Section 10.18 Reproduction of Documents.

         This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications which may hereafter be
executed, (b) documents received by any party at the closing, and (c) financial
statements, certificates and other information previously or hereafter
furnished, may be reproduced by any photographic, photostatic, microfilm,
micro-card, miniature photographic or other similar process. The parties agree
that any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding, whether or not the original
is in existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.

                                      -55-
<PAGE>

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

                                       CENTRE CAPITAL GROUP, INC.
                                       (Owner)

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

                                      -56-
<PAGE>

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

                                       BANK OF AMERICA, N.A.
                                       (Servicer)

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

                                      -57-
<PAGE>

                                    EXHIBIT A

                             MORTGAGE LOAN SCHEDULE

(retained in a separate closing binder entitled "SASCO 2001-16H Mortgage Loan
Schedule" at McKee Nelson LLP)

                                       -1-
<PAGE>

                                    EXHIBIT B

                            ACKNOWLEDGMENT AGREEMENT

         On this ____ day of ____________, 200_, Centre Capital Group, Inc.,
(the "Owner") as the Owner under that certain Master Servicing Agreement dated
as of May ___, 2000, (the "Agreement"), does hereby contract with the Bank of
America, N.A. (the "Servicer") as Servicer under the Agreement, to carry out the
servicing responsibilities related to the Mortgage Loans listed on the Mortgage
Loan Schedule attached hereto. The Servicer hereby accepts the servicing
responsibilities transferred hereby and on the date hereof assumes all servicing
responsibilities related to the Mortgage Loans identified on the attached
Mortgage Loan Schedule all in accordance with the Agreement. The contents of
each Servicing File required to be delivered to service the Mortgage Loans
pursuant to the Agreement have been or shall be delivered to the Servicer by the
Owner in accordance with the terms of the Agreement.

         With respect to the Mortgage Loans made subject to the Agreement
hereby, the Closing Date shall be ___________________.

         All other terms and conditions of this transaction shall be governed by
the Agreement.

         Capitalized terms used herein and not otherwise defined shall have the
meanings set forth in the Agreement.

                                    Exh B-1
<PAGE>

         This Acknowledgment Agreement may be executed simultaneously in any
number of counterparts. Each counterpart shall be deemed to be an original, and
all such counterparts shall constitute one and the same instrument.

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

                                       OWNER:
                                       CENTRE CAPITAL GROUP, INC.
                                       By:
                                          --------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------

                                       SERVICER:
                                       BANK OF AMERICA, N.A.
                                       By:
                                          --------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------

                                     Exh B-2
<PAGE>

                                    EXHIBIT C

                       CUSTODIAL ACCOUNT LETTER AGREEMENT

                                                         _________________, 200_

To:
    ----------------------

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

    ----------------------
    (the "Depository")

            As Servicer under the Master Servicing Agreement, dated as of May
__, 2000, Fixed and Adjustable Rate Mortgage Loans (the "Agreement"), we hereby
authorize and request you to establish an account, as a Custodial Account
pursuant to Section 3.04 of the Agreement, to be designated as "Bank of America,
N.A. in trust for Centre Capital Group, Inc., owner of Fixed and Adjustable Rate
Mortgage Loans." All deposits in the account shall be subject to withdrawal
therefrom by order signed by the Servicer. You may refuse any deposit which
would result in violation of the requirement that the account be fully insured
as described below. This letter is submitted to you in duplicate. Please execute
and return one original to us.

                                    Bank of America, N.A.
                                    Servicer

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

                                    Exh C-1-
<PAGE>

         The undersigned, as Depository, hereby certifies that the above
described account has been established under Account Number __________, at the
office of the Depository indicated above, and agrees to honor withdrawals on
such account as provided above. The full amount deposited at any time in the
account will be insured by the Federal Deposit Insurance Corporation through the
Bank Insurance Fund ("BIF") or the Savings Association Insurance Fund ("SAIF").

                                    ------------------------------------
                                                   Depository

                                    By:
                                       ---------------------------------

                                    Name:
                                         -------------------------------

                                    Title:
                                          ------------------------------

                                    Date:
                                         -------------------------------

                                     Exh C-2
<PAGE>

                                    EXHIBIT D

                         ESCROW ACCOUNT LETTER AGREEMENT

                                                    ___________________, 200_

To:
      --------------------------

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

      --------------------------
      (the "Depository")

As Servicer under the Master Servicing Agreement, dated as of May ___, 2000,
Fixed and Adjustable Rate Mortgage Loans (the "Agreement"), we hereby authorize
and request you to establish an account, as an Escrow Account pursuant to
Section 3.06 of the Agreement, to be designated as "Bank of America, N.A. in
trust for the Centre Capital Group, Inc., owner of Fixed and Adjustable Rate
Mortgage Loans, and various Mortgagors." All deposits in the account shall be
subject to withdrawal therefrom by order signed by the Servicer. You may refuse
any deposit which would result in violation of the requirement that the account
be fully insured as described below. This letter is submitted to you in
duplicate. Please execute and return one original to us.

                                    Bank of America, N.A.
                                    Servicer

                                    By:
                                       ---------------------------------

                                    Name:
                                         -------------------------------

                                    Title:
                                          ------------------------------

                                    Date:
                                         -------------------------------

                                    Exh D-1

<PAGE>

The undersigned, as Depository, hereby certifies that the above described
account has been established under Account Number ______, at the office of the
Depository indicated above, and agrees to honor withdrawals on such account as
provided above. The full amount deposited at any time in the account will be
insured by the Federal Deposit Insurance Corporation through the Bank Insurance
Fund ("BIF") or the Savings Association Insurance Fund ("SAIF").

                                    ------------------------------------
                                                Depository

                                    By:
                                       ---------------------------------

                                    Name:
                                         -------------------------------

                                    Title:
                                          ------------------------------

                                    Date:
                                         -------------------------------

                                    Exh D-2

<PAGE>

                                   EXHIBIT E-1

                        SERVICER'S OFFICER'S CERTIFICATE

         I, ____________________, hereby certify that I am the duly elected
[Vice] President of Bank of America, N.A., a national banking association, (the
"Company") and further as follows:

    1. Attached hereto as Exhibit 1 is a true, correct and complete copy of the
charter of the Company which is in full force and effect on the date hereof and
which has been in effect without amendment, waiver, rescission or modification.

    2. Attached hereto as Exhibit 2 is a true, correct and complete copy of the
bylaws of the Company which are in effect on the date hereof and which have been
in effect without amendment, waiver, rescission or modification.

    3. Attached hereto as Exhibit 3 is an original certificate of good standing
of the Company, issued within ten days of the date hereof, and no event has
occurred since the date thereof which would impair such standing.

    4. Attached hereto as Exhibit 4 is a true, correct and complete copy of the
resolutions of the Board of Directors of the Company authorizing the Company to
execute and deliver the Master Servicing Agreement, dated as of May ___, 2000
(the "Agreement"), by and between the Company and Centre Capital Group, Inc.,
(the "Owner"), and such resolutions are in effect on the date hereof and have
been in effect without amendment, waiver rescission or modification.

    5. To the best of my knowledge, either (i) no consent, approval,
authorization or order of any court or governmental agency or body is required
for the execution, delivery and performance by the Company of or compliance by
the Company with the Agreement or the consummation of the transactions
contemplated by the Agreement; or (ii) any required consent, approval,
authorization or order has been obtained by the Company.

    6. To the best of my knowledge, neither the consummation of the transactions
contemplated by, nor the fulfillment of the terms of the Agreement, conflicts or
will conflict with or results or will result in a breach of or constitutes or
will constitute a default under the charter or by-laws of the Company, the terms
of any indenture or other agreement or instrument to which the Company is a
party or by which it is bound or to which it is subject, or any statute or
order, rule, regulations, writ, injunction or decree of any court, governmental
authority or regulatory body to which the Company is subject or by which it is
bound.

    7. To the best of my knowledge, there is no action, suit, proceeding or
investigation pending or threatened against the Company which, in my judgment,
either in any one instance or in the aggregate, may result in any material
adverse change in the business, operations, financial condition, properties or
assets of the Company or in any material impairment of the right or ability of
the Company to carry on its business substantially as now conducted or in any
material

                                   Exh E-1-1

<PAGE>

liability on the part of the Company or which would draw into question
the validity of the Agreement or of any action taken or to be taken in
connection with the transactions contemplated hereby, or which would be likely
to impair materially the ability of the Company to perform under the terms of
the Agreement.

    8. Each person listed on Exhibit 5 attached hereto who, as an officer or
representative of the Company, signed the Agreement and any other document
delivered prior hereto or on the date hereof in connection with the Agreement,
was, at the respective times of such signing and delivery, and is now, a duly
elected or appointed, qualified and acting officer or representative of the
Company, who holds the office set forth opposite his or her name on Exhibit 5,
and the signatures of such persons appearing on such documents are their genuine
signatures.

    9. The Company is duly authorized to engage in the transactions described
and contemplated in the Agreement.

                                   Exh E-1-2

<PAGE>

            IN WITNESS WHEREOF, I have hereunto signed my name and affixed the
seal of the Company.

Dated:                                    By:
      ------------------------------         ---------------------------------
                                          Name:
                                               -------------------------------
[Seal]                                    Title:   [Vice] President

            I, ________________________, an [Assistant] Secretary of Bank of
America, N.A. hereby certify that ____________ is the duly elected, qualified
and acting [Vice] President of the Company and that the signature appearing
above is [her] [his] genuine signature.

            IN WITNESS WHEREOF, I have hereunto signed my name.

Dated:                                    By:
      ------------------------------         ---------------------------------
                                          Name:
                                               -------------------------------
[Seal]                                    Title:   [Vice] President

                                   Exh E-1-3

<PAGE>

                                         EXHIBIT 5 to
                                         Company's Officer's Certificate

            Name                Title               Signature

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

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

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

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

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

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

                                   Exh E-1-4
<PAGE>

                                   EXHIBIT E-2

                        SERVICER'S OFFICER'S CERTIFICATE

            I, ____________________, hereby certify that I am the duly elected
[Vice] President of Bank of America, N.A., a national banking association, (the
"Company") and further as follows:

    1. The charter of the Company in the form attached to the Company's
Officer's Certificate dated ____________ by ____________ is in full force and
effect on the date hereof and has been in effect without amendment, waiver,
rescission or modification since ______________.

    2. The bylaws of the Company in the form attached to the Company's Officer's
Certificate dated ____________ by ____________ are in effect on the date hereof
and have been in effect without amendment, waiver, rescission or modification
since ______________.

    3. Since the last date of issuance of a certificate of good standing of the
Company in the form attached to the Company's Officer's Certificate dated
____________ by ____________, no event has occurred since the date thereof which
would impair such standing.

    4. The resolutions of the Board of Directors of the Company in the form
attached to the Company's Officer's Certificate dated ____________ by
____________ are in effect on the date hereof and have been in effect without
amendment, waiver, rescission or modification since ______________.

    5. To the best of my knowledge, neither the consummation of the transactions
contemplated by, nor the fulfillment of the terms of the Master Servicing
Agreement dated as of May __, 2000, by and between Centre Capital Group, Inc.
and the Company, conflicts or will conflict with or results or will result in a
breach of or constitutes or will constitute a default under the charter or
by-laws of the Company, the terms of any indenture or other agreement or
instrument to which the Company is a party or by which it is bound or to which
it is subject, or any statute or order, rule, regulations, writ, injunction or
decree of any court, governmental authority or regulatory body to which the
Company is subject or by which it is bound.

    6. To the best of my knowledge, there is no action, suit, proceeding or
investigation pending or threatened against the Company which, in my judgment,
either in any one instance or in the aggregate, may result in any material
adverse change in the business, operations, financial condition, properties or
assets or the Company or in any material impairment of the right or ability of
the Company to carry on its business substantially as now conducted or in any
material liability on the part of the Company or which would draw into question
the validity of the Agreement or of any action taken or to be taken in
connection with the transactions contemplated hereby, or which would be likely
to impair materially the ability of the Company to perform under the terms of
the Agreement.

                                   Exh E-2-1

<PAGE>

    7. The Company is not currently in material breach of any representation or
warranty, or in material default under any provision of the Agreement.

    8. The Company is duly authorized to engage in the transactions described
and contemplated in the Agreement.

                                   Exh E-2-2
<PAGE>

           IN WITNESS WHEREOF, I have hereunto signed my name and affixed the
seal of the Company.

Dated:                                    By:
      ------------------------------         ---------------------------------
                                          Name:
                                               -------------------------------
      [Seal]                              Title:   [Vice] President

            I, ________________________, an [Assistant] Secretary of Bank of
America, N.A. hereby certify that ____________ is the duly elected, qualified
and acting [Vice] President of the Company and that the signature appearing
above is [her] [his] genuine signature.

            IN WITNESS WHEREOF, I have hereunto signed my name.

Dated:                                    By:
      ------------------------------         ---------------------------------
                                          Name:
                                               -------------------------------
      [Seal]                              Title:   [Vice] President

                                   Exh E-2-3
<PAGE>

                                    EXHIBIT F

                               CUSTODIAL AGREEMENT

                                     Exh F-1
<PAGE>

                                    EXHIBIT G

                    FORM OF OPINION OF COUNSEL TO THE SERVICER

                                          (date)

Centre Capital Group, Inc.
200 Pringle Avenue
Suite 500
Walnut Creek, CA 94596

Dear Sirs:

         You have requested [our] [my] opinion, as [Assistant] General Counsel
to Bank of America, N.A. (the "Company"), with respect to certain matters in
connection with the servicing by the Company of the Mortgage Loans pursuant to
that certain Master Servicing Agreement, Fixed and Adjustable Rate Mortgage
Loans, by and between the Company and Centre Capital Group, Inc., (the "Owner"),
dated as of May __ 2000, (the "Master Servicing Agreement") being executed
contemporaneously with an Assignment and Assumption Agreement by and between the
Company and the Owner (the "Assignment and Assumption Agreement"). Capitalized
terms not otherwise defined herein have the meanings set forth in the Master
Servicing Agreement.

         [We] [I] have examined the following documents:

         1.   the Master Servicing Agreement;

         2.   the Assignment and Assumption Agreement; and

         3.   such other documents, records and papers as [we] [I] have deemed
              necessary and relevant as a basis for this opinion.

         To the extent [we] [I] have deemed necessary and proper, [we] [I] have
relied upon the representations and warranties of the Company contained in the
Master Servicing Agreement. [We] [I] have assumed the authenticity of all
documents submitted to me as originals, the genuineness of all signatures, the
legal capacity of natural persons and the conformity to the originals of all
documents.

                                     Exh G-1
<PAGE>

            Based upon the foregoing, it is [our] [my] opinion that:

         1. The Company is a duly organized, validly existing national banking
association in good standing under the laws of the United States of America and
is qualified to service and administer the Mortgage Loans in the states where
the Mortgaged Properties are located.

         2. The Company has the power to engage in the transactions contemplated
by the Master Servicing Agreement and all requisite power, authority and legal
right to execute and deliver the Master Servicing Agreement and the Assignment
and Assumption Agreement, and to perform and observe the terms and conditions of
such instruments.

         3. Each of the Master Servicing Agreement and the Assignment and
Assumption Agreement has been duly authorized, executed and delivered by the
Company and is a legal, valid and binding agreement enforceable in accordance
with its respective terms against the Company, subject to bankruptcy laws and
other similar laws of general application affecting rights of creditors and
subject to the application of the rules of equity, including those respecting
the availability of specific performance, none of which will materially
interfere with the realization of the benefits provided thereunder.

         4. Either (i) no consent, approval, authorization or order of any court
or governmental agency or body is required for the execution, delivery and
performance by the Company of or compliance by the Company with the Master
Servicing Agreement or the Assignment and Assumption Agreement, or the servicing
of the Mortgage Loans or the consummation of the transactions contemplated by
the Master Servicing Agreement; or (ii) any required consent, approval,
authorization or order has been obtained by the Company.

         5. Neither the consummation of the transactions contemplated by, nor
the fulfillment of the terms of, the Master Servicing Agreement or the
Assignment and Assumption Agreement conflicts or will conflict with or results
or will result in a breach of, or constitutes or will constitute a default
under, the charter or by-laws of the Company, the terms of any indenture or
other agreement or instrument to which the Company is a party or by which it is
bound or to which it is subject, or violates any statute or order, rule,
regulations, writ, injunction or decree of any court, governmental authority or
regulatory body to which the Company is subject or by which it is bound.

         6. There is no action, suit, proceeding or investigation pending or, to
the best of [our] [my] knowledge, threatened against the Company which, in [our]
[my] judgment, either in any one instance or in the aggregate, may result in any
material adverse change in the business, operations, financial condition,
properties or assets of the Company or in any material impairment of the right
or ability of the Company to carry on its business substantially as now
conducted or in any material liability on the part of the Company or which would
draw into question the validity of the Master Servicing Agreement, the
Assignment and Assumption Agreement or of any action taken or to be taken in
connection with the transactions contemplated thereby, or which would be likely
to impair materially the ability of the Company to perform under the terms of
the Assignment and Assumption Agreement or the Master Servicing Agreement.

                                    Exh G-2
<PAGE>

         This opinion is given to you for your sole benefit, and no other person
or entity is entitled to rely hereon except that the Owner or Owners to which
you resell the Mortgage Loans may rely on this opinion as if it were addressed
to them as of its date, provided that the Company remains the Servicer of the
Mortgage Loans under the Master Servicing Agreement.

                                          Very truly yours,

                                          -------------------------------
                                                     Name
                                          [Assistant] General Counsel

                                     Exh G-3
<PAGE>

                                    EXHIBIT H

                              INTENTIONALLY OMITTED

                                     Exh H-1
<PAGE>

                                    EXHIBIT I

                   FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT

         ASSIGNMENT AND ASSUMPTION, dated as of May __, 2000 between Lehman
Capital, A Division of Lehman Brothers Holdings Inc. having an office at 3 World
Financial Center, New York, New York 10285 ("Assignor") and Bank of America,
N.A., having an office at 2810 North Parham Road, Richmond VA 23294-4400
("Assignee"):

         For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:

    1. The Assignor hereby grants, transfers and assigns to Assignee, all of the
right, title and interest of Assignor, as "Servicer", with respect to the
mortgage loans identified on Exhibit A (the "Mortgage Loans"), under that
certain Custodial Agreement, dated as of March 1, 1996 (the "Agreement"), by and
between Assignor as owner and servicer, and Norwest Bank of Minnesota, N.A. (the
"Custodian").

         The Assignor specifically reserves any and all right, title and
interest and all obligations of the Assignor with respect to any mortgage loans
subject to the Agreement which are not the Mortgage Loans set forth on Exhibit A
hereto and are not the subject of this Assignment and Assumption Agreement.

    2. The Assignor warrants and represents to, and covenants with, the Assignee
that with respect to the Mortgage Loans:

         a. The Assignor is assigning its interest as Servicer under the
Agreement for the sole purpose of permitting the Assignee as Servicer of the
Mortgage Loans, to act as Servicer under the Agreement; and

         b. The Assignor has not waived or agreed to any waiver under, or agreed
to any amendment or other modification of, the Agreement. The Assignor has no
knowledge of, and has not received notice of, any waivers under or amendments or
other modifications of, or assignments of rights or obligations under the
Agreement.

    3. The Assignee warrants and represents to, and covenants with, the Assignor
and the Custodian pursuant to the Agreement that the Assignee agrees to be
bound, as Servicer, by all of the terms, covenants and conditions of the
Agreement and from and after the date hereof, the Assignee assumes for the
benefit of the Assignor all of the Assignor's obligations as Servicer
thereunder.

                                     Exh I-1
<PAGE>

            IN WITNESS WHEREOF, the parties have caused this Assignment and
Assumption Agreement to be executed by their duly authorized officers as of the
date first above written.

BANK OF AMERICA, N.A.                     LEHMAN CAPITAL, A DIVISION OF LEHMAN
Assignee                                  BROTHERS HOLDINGS INC.
                                          Assignor

By:                                       By
   -----------------------------            -----------------------------

Its:                                      Its:
    -----------------------------             -----------------------------

                                     Exh I-2
<PAGE>

                                    EXHIBIT A

                             MORTGAGE LOAN SCHEDULE

(retained in a separate closing binder entitled "SASCO 2001-16H Mortgage Loan
Schedule" at McKee Nelson LLP)

                                     Exh I-3

<PAGE>

                                    EXHIBIT J

                   FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT

         ASSIGNMENT AND ASSUMPTION AGREEMENT, dated May ___, 2000, between
Centre Capital Group, Inc., a state chartered institution organized under the
laws of the North Carolina ("Assignor") and Lehman Capital, A Division of Lehman
Brothers Holdings Inc., a New York corporation ("Assignee"):

         For and in consideration of the sum of TEN DOLLARS ($10.00) and other
valuable consideration the receipt and sufficiency of which hereby are
acknowledged, and of the mutual covenants herein contained, the parties hereto
hereby agree as follows:

    1.   The Assignor hereby grants, transfers and assigns to Assignee, as
         Purchaser, all of the right, title and interest of Assignor with
         respect to the mortgage loans identified on Exhibit A (the "Mortgage
         Loans") under that certain Master Servicing Agreement, Conventional
         Residential Fixed and Adjustable Rate Mortgage Loans, (the "Master
         Servicing Agreement"), dated as of May __, 2000, by and between Centre
         Capital Group, Inc. (the "Purchaser"), and Bank of America, N.A. (the
         "Servicer").

         The Assignor specifically reserves any and all right, title and
         interest and all obligations of the Assignor with respect to any
         mortgage loans subject to the Agreement which are not the Mortgage
         Loans set forth on Exhibit A hereto and are not the subject of this
         Assignment and Assumption Agreement.

    2.   The Assignor warrants and represents to, and covenants with, the
         Assignee that:

         a.   The Assignor has not received notice of, and has no knowledge of,
              any offsets, counterclaims or other defenses available to the
              Servicer with respect to the Master Servicing Agreement or the
              Mortgage Loans;

         b.   The Assignor has not waived or agreed to any waiver under, or
              agreed to any amendment or other modification of, the Master
              Servicing Agreement, including without limitation, the transfer of
              the servicing obligations under the Master Servicing Agreement.
              The Assignor has no knowledge of, and has not received notice of,
              any waivers under or amendments or other modifications of, or
              assignments of rights or obligations under, the Master Servicing
              Agreement; and

    3.   That Assignee warrants and represents to, and covenants with, the
         Assignor and the Servicer pursuant to the Master Servicing Agreement
         that the Assignee agrees to be bound, as Purchaser, by all of the
         terms, covenants and conditions of the Master Servicing Agreement and
         from and after the date hereof, the Assignee assumes for the benefit of
         each of the Servicer and the Assignor all of the Assignor's obligations
         as Purchaser thereunder;

                                     Exh J-1
<PAGE>

            IN WITNESS WHEREOF, the parties have caused this Assignment and
Assumption Agreement to be executed by their duly authorized officers as of the
date first above written.

CENTRE CAPITAL GROUP, INC.               LEHMAN CAPITAL, A DIVISION OF LEHMAN
Assignor                                  BROTHERS HOLDINGS INC.
                                          Assignee

By:                                      By:
   --------------------------------         --------------------------------

Its:                                     Its:
    -------------------------------          -------------------------------

Taxpayer                                 Taxpayer
Identification No.                       Identification No.
                  -----------------                        -----------------

                                     Exh J-2

<PAGE>

                                    EXHIBIT A

                             MORTGAGE LOAN SCHEDULE

(retained in a separate closing binder entitled "SASCO 2001-16H Mortgage Loan
Schedule" at McKee Nelson LLP)

                                     Exh A-1

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