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Exhibit 99.18
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BARCLAYS BANK, PLC
Purchaser
MORTGAGEIT, INC.,
Seller
MORTGAGE LOAN PURCHASE AGREEMENT
Dated as of September 1, 2006
Conventional, Fixed and Adjustable Rate
Residential Mortgage Loans
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TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
Section 1.01 Defined
Terms............................................ 1
ARTICLE II
AGREEMENT TO PURCHASE
Section 2.01 Agreement to
Purchase.................................... 14
ARTICLE III
MORTGAGE SCHEDULES
Section 3.01 Preliminary Mortgage
Schedule............................ 14
Section 3.02 Delivery of Mortgage
Loan Schedule....................... 14
ARTICLE IV
PURCHASE PRICE
Section 4.01 Purchase
Price........................................... 14
ARTICLE V
EXAMINATION OF MORTGAGE FILES
Section 5.01 Examination of
Mortgage Files............................ 15
ARTICLE VI
CONVEYANCE FROM SELLER TO PURCHASER
Section 6.01 Conveyance of Mortgage
Loans............................ 16
Section 6.02 Books and
Records........................................ 16
Section 6.03 Delivery of Mortgage
Loan Documents...................... 17
Section 6.04 Quality Control
Procedures............................... 18
Section 6.05 MERS Designated
Loans.................................... 18
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ARTICLE VII
SERVICING OF THE MORTGAGE LOANS
Section 7.01
Servicing................................................
18
Section 7.02 Transfer of
Servicing.................................... 19
ARTICLE VIII
[RESERVED]
ARTICLE IX
REPRESENTATIONS,
WARRANTIES AND COVENANTS OF THE SELLER; REMEDIES FOR BREACH
Section 9.01 Representations and
Warranties Regarding the Seller...... 22
Section 9.02 Representations and
Warranties Regarding Individual
Mortgage Loans...........................................
25
Section 9.03 Remedies for Breach of
Representations and Warranties.... 39
Section 9.04 Repurchase of Mortgage
Loans with First Payment
Defaults.................................................
41
Section 9.05 Premium
Recapture........................................ 42
ARTICLE X
CLOSING
Section 10.01
Conditions to Closing....................................
42
ARTICLE XI
CLOSING DOCUMENTS
Section 11.01
Required Closing Documents...............................
43
ARTICLE XII
COSTS
Section 12.01
Costs....................................................
44
ARTICLE XIII
COOPERATION OF SELLER WITH A RECONSTITUTION
Section 13.01
Reconstitution of Mortgage Loans.........................
44
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ARTICLE XIV
THE SELLER
Section 14.01
Additional Indemnification by the Seller; Third Party
Claims...................................................
46
Section 14.02
Merger or Consolidation of the Seller....................
47
ARTICLE XV
MISCELLANEOUS PROVISIONS
Section 15.01
Financial Statements.....................................
48
Section 15.02
Mandatory Delivery; Grant of Security Interest...........
48
Section 15.03
Notices..................................................
49
Section 15.04
Severability Clause......................................
49
Section 15.05
Counterparts.............................................
50
Section 15.06
Governing Law............................................
50
Section 15.07
Intention of the Parties.................................
50
Section 15.08
Successors and Assigns; Assignment of Purchase
Agreement................................................
50
Section 15.09
Waivers..................................................
51
Section 15.10
Exhibits.................................................
51
Section 15.11
General Interpretive Principles..........................
51
Section 15.12
Reproduction of Documents................................
51
Section 15.13
Further Agreements.......................................
52
Section 15.14
Recordation of Assignments of Mortgage...................
52
Section 15.15 No
Solicitation.......................................... 52
Section 15.16
Waiver of Trial by Jury..................................
53
Section 15.17
Governing Law Jurisdiction; Consent to Service of
Process...................................................
53
ARTICLE XVI
COMPLIANCE WITH REGULATION AB
Section 16.01
Intent of the Parties; Reasonableness....................
53
Section 16.02
Additional Representations and Warranties of the Seller..
54
Section 16.03
Information to Be Provided by the Seller.................
54
Section 16.04
Indemnification; Remedies................................
57
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EXHIBITS
EXHIBIT A
CONTENTS OF EACH MORTGAGE FILE
EXHIBIT B
INDEMNIFICATION AND CONTRIBUTION AGREEMENT
EXHIBIT C FORM
OF SELLER'S OFFICER'S CERTIFICATE
EXHIBIT D FORM
OF OPINION OF COUNSEL TO THE SELLER
EXHIBIT E FORM
OF SECURITY RELEASE CERTIFICATION
EXHIBIT F FORM
OF SECURITY RELEASE CERTIFICATION
EXHIBIT G
UNDERWRITING GUIDELINES
EXHIBIT H FORM
OF ASSIGNMENT AND CONVEYANCE AGREEMENT
EXHIBIT I FORM
OF ASSIGNMENT AND RECOGNITION AGREEMENT
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MORTGAGE LOAN PURCHASE AGREEMENT
This MORTGAGE LOAN PURCHASE AGREEMENT (the "Agreement"), dated as
of
September 1, 2006, by and between Barclays Bank, PLC, a public
limited liability
company, registered in England and Wales under company number
1026167, having an
office at 200 Park Avenue, New York, New York 10166 (the
"Purchaser"), and
MortgageIT, Inc., a New York corporation, having an office at 33
Maiden Lane,
New York, New York 10038 (the "Seller").
WITNESSETH:
WHEREAS, the Seller desires to sell, from time to time, to the
Purchaser, and the Purchaser desires to purchase, from time to
time, from the
Seller, certain conventional fixed and adjustable rate residential
first-lien
and second lien residential mortgage loans (the "Mortgage Loans")
on a servicing
released basis as described herein, and which shall be delivered in
pools of
whole loans (each, a "Mortgage Loan Package") on various dates as
provided
herein (each, a "Closing Date");
WHEREAS, each Mortgage Loan is secured by a mortgage, deed of trust
or
other security instrument creating a first lien or second lien on a
residential
dwelling located in the jurisdiction indicated on the Mortgage Loan
Schedule for
the related Mortgage Loan Package;
WHEREAS, the Purchaser and the Seller wish to prescribe the manner
of
the conveyance, servicing and control of the Mortgage Loans;
and
WHEREAS, following its purchase of the Mortgage Loans from the
Seller,
the Purchaser desires to sell some or all of the Mortgage Loans to
one or more
purchasers as a whole loan transfer or a public or private, rated
or unrated
Securitization Transaction;
NOW, THEREFORE, in consideration of the premises and mutual
agreements
set forth herein, and for other good and valuable consideration,
the receipt and
sufficiency of which are hereby acknowledged, the Purchaser and the
Seller agree
as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms.
For purposes of this Agreement the following capitalized terms
shall
have the respective meanings set forth below.
Accepted
Servicing Practices: With respect to any Mortgage Loan, those
mortgage servicing practices of prudent mortgage lending
institutions which
service mortgage
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loans of the same type as such Mortgage Loan in the jurisdiction
where the
related Mortgaged Property is located.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan
purchased pursuant to this Agreement.
Affiliate: With respect to any specified Person, any other
Person
controlling or controlled by or under common control with such
specified Person.
For the purposes of this definition, "control" when used with
respect to any
specified Person means the power to direct the management and
policies of such
Person, directly or indirectly, whether through the ownership of
voting
securities, by contract or otherwise and the terms "controlling"
and
"controlled" have meanings correlative to the foregoing.
Agency Transfer: A Fannie Mae Transfer or a Freddie Mac
Transfer.
Agreement: This Mortgage Loan Purchase Agreement and all
amendments
hereof and supplements hereto.
ALTA: The American Land Title Association or any successor
thereto.
Appraised Value: The value set forth in an appraisal made in
connection with the origination of the related Mortgage Loan
pursuant to the
Underwriting Guidelines as the value of the Mortgaged Property.
Assignment and Conveyance Agreement: As defined in Section
6.01.
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 sale of the Mortgage to the Purchaser.
Balloon Mortgage Loan: Any Mortgage Loan (a) that requires only
payments of interest until the stated maturity date of the Mortgage
Loan or (b)
for which Monthly Payments of principal (not including the payment
due on its
stated maturity date) are based on an amortization schedule that
would be
insufficient to fully amortize the principal thereof by the stated
maturity date
of the Mortgage Loan.
Business Day: Any day other than (i) a Saturday or Sunday, (ii) a
day
on which banking and savings and loan institutions, in the State of
New York or
the State in which the Seller's servicing operations are located or
(iii) the
state in which the Custodian's operations are located, are
authorized or
obligated by law or executive order to be closed.
Closing Date: The date or dates on which the Purchaser from time
to
time shall purchase, and the Seller from time to time shall sell,
the Mortgage
Loans listed on the related Mortgage Loan Schedule with respect to
the related
Mortgage Loan Package.
CLTV: As of any date and as to any Second Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding
principal
balance of the Second Lien Loan and (ii) the outstanding principal
balance as of
such date of any mortgage loan or mortgage loans that
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are senior or equal in priority to the Second Lien Loan and which
are secured by
the same Mortgaged Property to (b) the Appraised Value as
determined pursuant to
the Underwriting Guidelines of the related Mortgaged Property as of
the
origination of the Second Lien Loan.
Code: Internal Revenue Code of 1986, as amended.
Commission: The United States Securities and Exchange
Commission.
Condemnation Proceeds: All awards or 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.
Co-op: A private, cooperative housing corporation, having only
one
class of stock outstanding, which owns or leases land and all or
part of a
building or buildings, including apartments, spaces used for
commercial purposes
and common areas therein and whose board of directors authorizes
the sale of
stock and the issuance of a Co-op Lease.
Co-op Lease: With respect to a Co-op Loan, the lease with respect
to a
dwelling unit occupied by the Mortgagor and relating to the stock
allocated to
the related dwelling unit.
Co-op Loan: A Mortgage Loan secured by the pledge of stock
allocated
to a dwelling unit in a residential cooperative housing corporation
and a
collateral assignment of the related Co-op Lease. A private,
cooperative housing
corporation, having only one class of stock outstanding, which owns
or leases
land and all or part of a building or buildings, including
apartments, spaces
used for commercial purposes and common areas therein and whose
board of
directors authorizes the sale of stock and the issuance of a Co-op
Lease.
Covered Loan: A Mortgage Loan categorized as Covered pursuant
to
Appendix E of Standard & Poor's Glossary.
[Custodial Agreement: The agreement(s) governing the retention of
the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage
and other
Mortgage Loan Documents. If more than one Custodial Agreement is in
effect at
any given time, all of the individual Custodial Agreements shall
collectively be
referred to as the "Custodial Agreement."]
[Custodian: [____________________], a [____________________], and
its
successors in interest or permitted assigns or any successor to the
Custodian
under the Custodial Agreement as therein provided.]
Cut-off
Date: The date or dates designated as such on the related
Mortgage Loan Schedule with respect to the related Mortgage Loan
Package.
Deemed Material and Adverse Representation: Each representation
and
warranty identified as such in Section 9.02 of this Agreement.
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Deleted Mortgage Loan: A Mortgage Loan that is repurchased or
replaced
or to be replaced with a Qualified Substitute Mortgage Loan by the
Seller in
accordance with the terms of this Agreement.
Depositor: The depositor, as such term is defined in Regulation
AB,
with respect to any Securitization Transaction.
Determination Date: With respect to each Remittance Date, the 15th
day
(or, if such 15th day is not a Business Day, the preceding Business
Day) of the
month in which such Remittance Date occurs.
Due Date: The day of the month on which the Monthly Payment is due
on
a Mortgage Loan, exclusive of any days of grace.
Eligible Account: Any of (i) an account maintained with a federal
or
state chartered depository institution or trust company the
short-term unsecured
debt obligations of which (or, in the case of a depository
institution or trust
company that is a subsidiary of a holding company, the short-term
unsecured debt
obligations of such holding company) are rated A-1 by Standard
& Poor's or
Prime-1 by Moody's (or a comparable rating if another Rating Agency
is specified
by the Purchaser by written notice to the Seller) at the time any
amounts are
held on deposit therein, (ii) an account or accounts the deposits
in which are
fully insured by the FDIC, or (iii) a trust account or accounts
maintained with
a federal or state chartered depository institution or trust
company acting in
its fiduciary capacity.
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.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Fannie Mae: The Federal National Mortgage Association, or any
successor thereto.
Fannie Mae Guides: The Fannie Mae Sellers' Guide and the Fannie
Mae
Servicers' Guide, and all amendments or additions thereto.
Fannie Mae Transfer: As defined in Article XIII.
FDIC: The Federal Deposit Insurance Corporation, or any
successor
thereto.
First Lien Loan: A Mortgage Loan secured by a first lien Mortgage
on
the related Mortgaged Property.
Fitch: Fitch, Inc., or its successor in interest.
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Fixed Rate Mortgage Loan: A fixed rate mortgage loan purchased
pursuant to this Agreement.
Freddie Mac: The Federal Home Loan Mortgage Corporation, or any
successor thereto.
Freddie Mac Transfer: As defined in Article XIII.
Gross Margin: With respect to each Adjustable Rate Mortgage Loan,
the
fixed percentage amount set forth in the related Mortgage Note
which amount is
added to the Index in accordance with the terms of the related
Mortgage Note to
determine on each Interest Rate Adjustment Date the Mortgage
Interest Rate for
such Mortgage Loan.
High Cost Loan: A Mortgage Loan (a) covered by the Home Ownership
and
Equity Protection Act of 1994 ("HOEPA"), (b) with an "annual
percentage rate" or
total "points and fees" payable by the related Mortgagor (as each
such term is
calculated under HOEPA) that exceed the thresholds set forth by
HOEPA and its
implementing regulations, including 12 C.F.R. Section
226.32(a)(1)(i) and (ii),
(c) classified as a "high cost home," "threshold," "covered,"
(excluding New
Jersey "Covered Home Loans" as that term was defined in clause (1)
of the
definition of that term in the New Jersey Home Ownership Security
Act of 2002
that were originated between November 26, 2003 and July 7, 2004),
"high risk
home," "predatory" or similar loan under any other applicable
state, federal or
local law (or a similarly classified loan using different
terminology under a
law imposing heightened regulatory scrutiny or additional legal
liability for
residential mortgage loans having high interest rates, points
and/or fees) or
(d) categorized as High Cost pursuant to Appendix E of Standard
& Poor's
Glossary. For avoidance of doubt, the parties agree that this
definition shall
apply to any law regardless of whether such law is presently, or in
the future
becomes, the subject of judicial review or litigation.
Home Loan: A Mortgage Loan categorized as Home Loan pursuant to
Appendix E of Standard & Poor's Glossary.
Index: The index indicated in the related Mortgage Note for
each
Adjustable Rate Mortgage Loan.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds
of
insurance policies insuring the Mortgage Loan or the related
Mortgaged Property.
Interest Rate Adjustment Date: With respect to each Adjustable
Rate
Mortgage Loan, the date, specified in the related Mortgage Note and
the related
Mortgage Loan Schedule, on which the Mortgage Interest Rate is
adjusted.
Interim Funder: With respect to each MERS Designated Mortgage
Loan,
the Person named on the MERS System as the interim funder pursuant
to the MERS
Procedures Manual.
Investor: With respect to each MERS Designated Mortgage Loan,
the
Person named on the MERS System as the investor pursuant to the
MERS Procedures
Manual.
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Lifetime Rate Cap: The provision of each Mortgage Note related to
an
Adjustable Rate Mortgage Loan which provides for an absolute
maximum Mortgage
Interest Rate thereunder. The Mortgage Interest Rate during the
terms of each
Adjustable Rate Mortgage Loan shall not at any time exceed the
Mortgage Interest
Rate at the time of origination of such Adjustable Rate Mortgage
Loan by more
than the Lifetime Rate Cap set forth as an amount per annum on the
related
Mortgage Loan Schedule.
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 Mortgaged Property if the Mortgaged Property is acquired in
satisfaction
of the Mortgage Loan.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan,
the
ratio (expressed as a percentage) of the outstanding principal
amount of the
Mortgage Loan as of the related Cut-off Date (unless otherwise
indicated), to
the lesser of (a) the related Appraised Value and (b) if the
Mortgage Loan was
made to finance the acquisition of the related Mortgaged Property,
the purchase
price of the Mortgaged Property.
MERS: Mortgage Electronic Registration Systems, Inc., a
Delaware
corporation, and its successors in interest.
MERS Designated Mortgage Loan: A Mortgage Loan for which (a)
the
Seller has designated or will designate MERS as, and has taken or
will take such
action as is necessary to cause MERS to be, the mortgagee of
record, as nominee
for the Seller, in accordance with MERS Procedures Manual and (b)
the Seller has
designated or will designate the Purchaser as the Investor on the
MERS System.
MERS Procedures Manual: The MERS Procedures Manual, as it may
be
amended, supplemented or otherwise modified from time to time.
MERS Report: The report from the MERS System listing MERS
Designated
Mortgage Loans and other information.
MERS System: MERS mortgage electronic registry system, as more
particularly described in the MERS Procedures Manual.
Monthly Payment: The scheduled monthly payment of principal and
interest on a Mortgage Loan.
Moody's: Moody's Investors Service, Inc., and any successor
thereto.
Mortgage: The mortgage, deed of trust or other instrument securing
a
Mortgage Note, which creates a first lien, in the case of a First
Lien Loan, or
a second lien, in the case of a Second Lien Loan, on an
unsubordinated estate in
fee simple in real property securing the Mortgage Note; except that
with respect
to real property located in jurisdictions in which the use of
leasehold estates
for residential properties is a widely accepted practice, the
mortgage, deed of
trust or other instrument securing the Mortgage Note may secure and
create, with
respect to a First Lien Loan, a first lien, and with respect to a
Second Lien
Loan, a second lien, in each case,
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upon a leasehold estate of the Mortgagor. With respect to a Co-op
Loan, the
Security Agreement.
Mortgage File: The items pertaining to a particular Mortgage
Loan
referred to in Exhibit A annexed hereto, and any additional
documents required
to be added to the Mortgage File pursuant to this Agreement.
Mortgage Interest Rate: The annual rate of interest borne on a
Mortgage Note with respect to each Mortgage Loan.
Mortgage Interest Rate Cap: With respect to an Adjustable Rate
Mortgage Loan, the limit on each Mortgage Interest Rate adjustment
as set forth
in the related Mortgage Note.
Mortgage Loan: An individual Mortgage Loan which is the subject
of
this Agreement, each Mortgage Loan originally sold and subject to
this Agreement
being identified on the applicable Mortgage Loan Schedule, which
Mortgage Loan
includes without limitation the Mortgage File, the Monthly
Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance
Proceeds,
Servicing Rights and all other rights, benefits, proceeds and
obligations
arising from or in connection with such Mortgage Loan, excluding
replaced or
repurchased mortgage loans.
Mortgage Loan Documents: The documents required to be delivered to
the
Custodian pursuant to Section 6.03 with respect to any Mortgage
Loan.
Mortgage Loan Package: Each pool of Mortgage Loans, which shall
be
purchased by the Purchaser from the Seller from time to time on
each Closing
Date.
Mortgage Loan Schedule: The schedule of Mortgage Loans setting
forth
the following information with respect to each Mortgage Loan in the
related
Mortgage Loan Package: (1) the Seller's Mortgage Loan identifying
number; (2)
the Mortgagor's name; (3) the street address of the Mortgaged
Property including
the city, state and zip code; (4) a code indicating whether the
Mortgagor is
self-employed; (5) a code indicating whether the Mortgaged Property
is
owner-occupied, investment property or a second home; (6) the
number and type of
residential units constituting the Mortgaged Property (e.g., single
family
residence, a two- to four-family dwelling, condominium, planned
unit development
or cooperative); (7) the original months to maturity or the
remaining months to
maturity from the related Cut-off Date, in any case based on the
original
amortization schedule and, if different, the maturity expressed in
the same
manner but based on the actual amortization schedule; (8) with
respect to each
First Lien Loan, the Loan-to-Value Ratio at origination, and with
respect to
each Second Lien Loan, the CLTV at origination; (9) the Mortgage
Interest Rate
as of the related Cut-off Date; (10) the date on which the first
Monthly Payment
was due on the Mortgage Loan and, if such date is not consistent
with the Due
Date currently in effect, the Due Date; (11) the stated maturity
date; (12) the
amount of the Monthly Payment as of the related Cut-off Date; (13)
the last
payment date on which a payment was actually applied to the
outstanding
principal balance; (14) the original principal amount of the
Mortgage Loan; (15)
the principal balance of the Mortgage Loan as of the close of
business on the
related Cut-off Date, after deduction of payments of principal due
and collected
on or before the related Cut-off Date; (16) with respect to each
Adjustable Rate
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Mortgage Loan, the Interest Rate Adjustment Date; (17) with respect
to each
Adjustable Rate Mortgage Loan, the Gross Margin; (18) with respect
to each
Adjustable Rate Mortgage Loan, the Lifetime Rate Cap under the
terms of the
Mortgage Note; (19) with respect to each Adjustable Rate Mortgage
Loan, a code
indicating the type of Index; (20) the type of Mortgage Loan (i.e.,
Fixed Rate
or Adjustable Rate Mortgage Loan, First or Second Lien Loan); (21)
a code
indicating the purpose of the loan (i.e., purchase, rate/term
refinance, equity
take-out refinance); (22) a code indicating the documentation style
(i.e. no
documents, full, alternative, reduced, no income/no asset, stated
income, no
ratio, reduced or NIV); (23) asset verification (Y/N); (24) the
loan credit
classification (as described in the Underwriting Guidelines); (25)
whether such
Mortgage Loan provides for a Prepayment Penalty; (26) the
Prepayment Penalty
period of such Mortgage Loan, if applicable; (27) a description of
the
Prepayment Penalty, if applicable; (28) the Mortgage Interest Rate
as of
origination; (29) the credit risk score (FICO score); (30) the date
of
origination; (31) with respect to each Adjustable Rate Mortgage
Loan, the
Mortgage Interest Rate adjustment period; (32) with respect to each
Adjustable
Rate Mortgage Loan, the Mortgage Interest Rate adjustment
percentage; (33) with
respect to each Adjustable Rate Mortgage Loan, the Mortgage
Interest Rate floor;
(34) the Mortgage Interest Rate calculation method (i.e., 30/360,
simple
interest, other); (35) with respect to each Adjustable Rate
Mortgage Loan, the
Periodic Rate Cap as of the first Interest Rate Adjustment Date;
(36) a code
indicating whether the Mortgage Loan is a Balloon Mortgage Loan;
(37) a code
indicating whether the Mortgage Loan is a Home Loan; (38) the
original Monthly
Payment due; (39) the Appraised Value; (40) appraisal verification
(Y/N); (41)
type of appraisal verification, if any; (42) a code indicating
whether the
Mortgage Loan is covered by a PMI Policy and, if so, identifying
the PMI Policy
provider; (43) PMI coverage percentage; (44) in connection with a
condominium
unit, a code indicating whether the condominium project where such
unit is
located is low-rise or high-rise; (45) a code indicating whether
the Mortgaged
Property is a leasehold estate; (46) the MERS Identification
Number, if
applicable; (47) a code indicating the documentation style, as
required by
Standard & Poor's criteria; (48) number of times previously 30+
delinquent (if
applicable); and (49) with respect to each Option ARM Mortgage
Loan, (a) a
detailed transaction history indicating how all payments were
applied, (b)
negative amortization indicator (Y/N), (c) the total negative
amortization
amount as of the Closing Date, (d) the maximum negative
amortization percentage,
(e) the recast period, and (f) all adjustable rate change
histories. With
respect to the Mortgage Loans in the aggregate, the related
Mortgage Loan
Schedule shall set forth the following information, as of the
related Cut-off
Date: (1) the number of Mortgage Loans; (2) the current aggregate
outstanding
principal balance of the Mortgage Loans; (3) the weighted average
Mortgage
Interest Rate of the Mortgage Loans; (4) the weighted average
maturity of the
Mortgage Loans; (5) the average principal balance of the Mortgage
Loans; (6) the
applicable Cut-off Date; and (7) the applicable Closing Date.
Mortgage Note: The note or other evidence of the indebtedness of
a
Mortgagor secured by a Mortgage.
Mortgaged Property: With respect to a Mortgage Loan that is not
a
Co-op Loan, the Mortgagor's real property (or leasehold estate, if
applicable)
securing repayment of a related Mortgage Note, consisting of an
unsubordinated
estate in fee simple or, with respect to real property located in
jurisdictions
in which the use of leasehold estates for residential properties is
a
widely-accepted practice, a leasehold estate, in a single parcel or
multiple
parcels of real property improved by a Residential Dwelling. With
respect to a
Co-op Loan, the stock allocated
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to a dwelling unit in the residential cooperative housing
corporation that was
pledged to secure such Co-op Loan and the related Co-op Lease.
Mortgagor: The obligor on the related Mortgage Note.
Officer's Certificate: A certificate signed by the Chairman of
the
Board or the Vice Chairman of the Board or the Chief Financial
Officer or the
Chief Operating Officer or a President or a Vice President and by
the Treasurer
or the Secretary or one of the Assistant Treasurers or Assistant
Secretaries of
the Seller, and delivered to the Purchaser as required by this
Agreement.
Opinion of Counsel: A written opinion of counsel, who may be
counsel
for the Seller, reasonably acceptable to the Purchaser, provided
that any
Opinion of Counsel relating to (a) the qualification of any account
required to
be maintained pursuant to this Agreement as an Eligible Account,
(b)
qualification of the Mortgage Loans in a REMIC or (c) compliance
with the REMIC
Provisions, must be (unless otherwise stated in such Opinion of
Counsel) an
opinion of counsel who (i) is in fact independent of the Seller and
any servicer
of the Mortgage Loans, (ii) does not have any material direct or
indirect
financial interest in the Seller or any servicer of the Mortgage
Loans or in an
Affiliate of either (except the compensation by the Seller or an
Affiliate
thereof for legal representation) and (iii) is not connected with
the Seller or
any servicer of the Mortgage Loans as an officer, employee,
director or person
performing similar functions.
Option ARM Mortgage Loan: An Adjustable Rate Mortgage Loan that
gives
the related Mortgagor different payment options each month, which
include,
without limitation: (i) a minimum monthly payment option, (ii) an
interest-only
payment option or (iii) a full principal and interest option which
amortizes
over 40 years or less.
Periodic Rate Cap: The provision of each Mortgage Note related to
an
Adjustable Rate Mortgage Loan which provides for an absolute
maximum amount by
which the Mortgage Interest Rate therein may increase or decrease
on an Interest
Rate Adjustment Date above or below the Mortgage Interest Rate
previously in
effect. The Periodic Rate Cap for each Adjustable Rate Mortgage
Loan is the rate
set forth as such on the related Mortgage Loan Schedule.
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
an insurer acceptable under the Underwriting Guidelines and
qualified to do
business in the jurisdiction where the Mortgaged Property is
located.
Preliminary Mortgage Schedule: As defined in Article III.
Prepayment Penalty: With respect to each Mortgage Loan, the penalty
if
the Mortgagor prepays such Mortgage Loan as provided in the related
Mortgage
Note or Mortgage.
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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 Penalty 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.
Purchase Price:
The price paid on the related Closing Date by the
Purchaser to the Seller in exchange for the Mortgage Loans
purchased on such
Closing Date as calculated in Article IV of this Agreement.
Purchase Price and Terms Agreement: Those certain agreements
setting
forth the general terms and conditions of the transactions
consummated herein
and identifying the Mortgage Loans to be purchased from time to
time hereunder,
by and between the Seller and the Purchaser.
Purchaser: Barclays Bank, PLC, a public limited liability
company,
registered in England and Wales under Company number 1026167 and
its successors
in interest and assigns, or any successor to the Purchaser under
this Agreement
as herein provided.
Qualified Appraiser: An appraiser, duly appointed by the Seller,
who
had no interest, direct or indirect, in the Mortgaged Property or
in any loan
made on the security thereof, and whose compensation was not
affected by the
approval or disapproval of the Mortgage Loan, and such appraiser
and the
appraisal made by such appraiser both satisfied the requirements of
Title XI of
the Financial Institutions Reform, Recovery, and Enforcement Act of
1989 and the
regulations promulgated thereunder, all as in effect on the date
the Mortgage
Loan was originated.
Qualified Correspondent: Any Person from which the Seller
purchased
Mortgage Loans, provided that the following conditions are
satisfied: (i) such
Mortgage Loans were originated pursuant to an agreement between the
Seller and
such Person that contemplated that such Person would underwrite
mortgage loans
from time to time, for sale to the Seller, in accordance with
underwriting
guidelines designated by the Seller ("Designated Guidelines") or
guidelines that
do not vary materially from such Designated Guidelines; (ii) such
Mortgage Loans
were in fact underwritten as described in clause (i) above and were
acquired by
the Seller within 180 days after origination; (iii) either (x) the
Designated
Guidelines were, at the time such Mortgage Loans were originated,
used by the
Seller in origination of mortgage loans of the same type as the
Mortgage Loans
for the Seller's own account or (y) the Designated Guidelines were,
at the time
such Mortgage Loans were underwritten, designated by the Seller on
a consistent
basis for use by lenders in originating mortgage loans to be
purchased by the
Seller; and (iv) the Seller employed, at the time such Mortgage
Loans were
acquired by the Seller, pre-purchase or post-purchase quality
assurance
procedures (which may involve, among other things, review of a
sample of
mortgage loans purchased during a particular time period or through
particular
channels) designed to ensure that Persons from which it purchased
mortgage loans
properly applied the underwriting criteria designated by the
Seller.
Qualified Substitute Mortgage Loan: A mortgage loan eligible to
be
substituted by the Seller for a Deleted Mortgage Loan which must,
on the date of
such substitution, (i) have
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an outstanding principal balance, after deduction of all scheduled
payments due
in the month of substitution (or in the case of a substitution of
more than one
mortgage loan for a Deleted Mortgage Loan, an aggregate principal
balance), not
in excess of the outstanding principal balance of the Deleted
Mortgage Loan (the
amount of any shortfall will be deposited in the collection account
by the
Seller in the month of substitution); (ii) have a Mortgage Interest
Rate not
less than and not more than 1% greater than the Mortgage Interest
Rate of the
Deleted Mortgage Loan; (iii) have a remaining term to maturity not
greater than
and not more than one year less than that of the Deleted Mortgage
Loan; (iv) be
of the same type as the Deleted Mortgage Loan (i.e., fixed rate or
adjustable
rate with same Mortgage Interest Rate Caps); and (v) comply with
each
representation and warranty (respecting individual Mortgage Loans)
set forth in
Article IX.
Rating Agency: Any of Fitch, Moody's or Standard & Poor's, or
their
respective successors designated by the Purchaser.
Reconstitution: Any Securitization Transaction or Whole Loan
Transfer.
Reconstitution Agreements: The agreement or agreements entered into
by
the Seller and the Purchaser and/or certain third parties on the
Reconstitution
Date or Dates with respect to any or all of the Mortgage Loans sold
hereunder,
in connection with a Whole Loan Transfer, Agency Transfer or a
Securitization
Transaction pursuant to Article XIII, including, but not limited
to, a seller's
warranties and servicing agreement with respect to a Whole Loan
Transfer, and a
pooling and servicing agreement and/or seller/servicer agreements
and related
custodial/trust agreement and documents with respect to a
Securitization
Transaction.
Reconstitution Date: As defined in Article XIII.
Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation
AB), 17 C.F.R. Sections 229.1100-229.1123, as such may be amended
from time to
time, and subject to such clarification and interpretation as have
been provided
by the Commission in the adopting release (Asset-Backed Securities,
Securities
Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005))
or by the
staff of the Commission, or as may be provided by the Commission or
its staff
from time to time.
Relief Act: The Servicemembers' Civil Relief Act of 2003, as
amended.
REMIC: A "real estate mortgage investment conduit" within the
meaning
of Section 860D of the Code.
REMIC Provisions: Provisions of the federal income tax law relating
to
a REMIC, which appear at Section 860A through 860G of Subchapter M
of Chapter 1,
Subtitle A of the Code, and related provisions and regulations,
rulings or
pronouncements promulgated thereunder, as the foregoing may be in
effect from
time to time.
Remittance Date: The 18th day of any month (or, if such 18th day
is
not a Business Day, the following Business Day).
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Repurchase Price: As defined in the related Purchase Price and
Terms
Agreement.
Residential Dwelling: Any one of the following: (i) a detached
one-family dwelling, (ii) a detached two- to four-family dwelling,
(iii) a
one-family dwelling unit in a condominium project or (iv) a
one-family dwelling
in a planned unit development, none of which is a mobile home or
manufactured
home.
RESPA: Real Estate Settlement Procedures Act, as amended from time
to
time.
Second Lien Loan: A Mortgage Loan secured by a second lien Mortgage
on
the related Mortgaged Property.
Securities Act: The Securities Act of 1933, as amended.
Securitization Transaction: Any transaction involving either (1)
a
sale or other transfer of some or all of the Mortgage Loans
directly or
indirectly to an issuing entity in connection with an issuance of
publicly
offered or privately placed, rated or unrated mortgage-backed
securities or (2)
an issuance of publicly offered or privately placed, rated or
unrated
securities, the payments on which are determined primarily by
reference to one
or more portfolios of residential mortgage loans consisting, in
whole or in
part, of some or all of the Mortgage Loans.
Security
Agreement: The agreement creating a security interest in the
stock allocated to a dwelling unit in the residential cooperative
housing
corporation that was pledged to secure such Co-op Loan and the
related Co-op
Lease.
Seller: As defined in the initial paragraph of the Agreement,
together
with its successors in interest.
Seller Information: As defined in Section 16.04(a).
[Servicing Fee: With respect to each Mortgage Loan subject to
servicing under this Agreement, a fee payable monthly equal to
$8.00 per month
per Mortgage Loan. Such fee shall be payable monthly and shall be
pro-rated for
any portion of a month during which the Mortgage Loan is serviced
by the Seller
hereunder. The obligation of the Purchaser 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 this Agreement) of such Monthly Payment
collected by the
Seller as servicer, or as otherwise provided under this
Agreement.]
Servicing File: With respect to each Mortgage Loan, the file
retained
by the Seller as servicer consisting of originals of all documents
in the
Mortgage File which are not delivered to the Purchaser or the
Custodian and
copies of the Mortgage Loan Documents set forth in [Section 2] of
the Custodial
Agreement.
Servicing Rights: Any and all of the following: (a) any and all
rights
to service the Mortgage Loans; (b) any payments to or monies
received by the
Seller for servicing the
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Mortgage Loans; (c) any late fees, penalties or similar payments
with respect to
the Mortgage Loans; (d) all agreements or documents creating,
defining or
evidencing any such servicing rights to the extent they relate to
such servicing
rights and all rights of the Seller thereunder; (e) Escrow Payments
or other
similar payments with respect to the Mortgage Loans and any amounts
actually
collected by the Seller with respect thereto; (f) all accounts and
other rights
to payment related to any of the property described in this
paragraph; and (g)
any and all documents, files, records, servicing files, servicing
documents,
servicing records, data tapes, computer records, or other
information pertaining
to the Mortgage Loans or pertaining to the past, present or
prospective
servicing of the Mortgage Loans.
Sponsor: The sponsor, as such term is defined in Item 1101(l)
of
Regulation AB, with respect to any Securitization Transaction.
Standard & Poor's: Standard & Poor's Ratings Services, a
division of
The McGraw-Hill Companies Inc., and any successor thereto.
Standard & Poor's Glossary: The Standard & Poor's LEVELS(R)
Glossary,
as may be in effect from time to time.
Stated Principal Balance: As to each Mortgage Loan on any date
of
determination, (i) the principal balance of such Mortgage Loan at
the related
Cut-off Date after giving effect to payments of principal due on or
before such
date, to the extent actually received, minus (ii) all amounts
previously
distributed to the Purchaser with respect to the related Mortgage
Loan
representing payments or recoveries of principal on such Mortgage
Loan.
Static
Pool Information: Static pool information as described in Item
1105(a)(1)-(3) and 1105(c) of Regulation AB.
Successor Servicer: Any servicer of one or more Mortgage Loans
designated by the Purchaser as being entitled to the benefits of
the
indemnifications set forth in Sections 9.03 and 14.01.
Third-Party Originator: Each Person, other than a Qualified
Correspondent, that originated Mortgage Loans acquired by the
Seller.
Transfer Date: The date on which the Purchaser, or its designee,
shall
receive the transfer of servicing responsibilities and begin to
perform the
servicing of the Mortgage Loans with respect to the related
Mortgage Loan
Package, and the Seller shall cease all servicing
responsibilities.
Underwriting Guidelines: The underwriting guidelines of the Seller,
a
copy of which is attached as an exhibit to the related Assignment
and
Conveyance.
Whole Loan Transfer: Any sale or transfer of some or all of the
Mortgage Loans, other than a Securitization Transaction.
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ARTICLE II
AGREEMENT TO PURCHASE
Section 2.01 Agreement to Purchase.
The Seller agrees to sell from time to time, and the Purchaser
agrees
to purchase from time to time, Mortgage Loans having an aggregate
principal
balance on the related Cut-off Date in an amount as set forth in
the related
Purchase Price and Terms Agreement, or in such other amount as
agreed by the
Purchaser and the Seller as evidenced by the actual aggregate
principal balance
of the Mortgage Loans accepted by the Purchaser on each Closing
Date.
ARTICLE III
MORTGAGE SCHEDULES
Section 3.01 Preliminary Mortgage Schedule.
The Seller from time to time shall provide the Purchaser, upon
request, with certain information constituting a preliminary
listing of the
Mortgage Loans to be purchased on each Closing Date in accordance
with the
related Purchase Price and Terms Agreement and this Agreement
(each, a
"Preliminary Mortgage Schedule").
Section 3.02 Delivery of Mortgage Loan Schedule.
The Seller shall deliver the related Mortgage Loan Schedule for
the
Mortgage Loans to be purchased on a particular Closing Date to the
Purchaser at
least five (5) Business Days prior to the related Closing Date. The
related
Mortgage Loan Schedule shall be the related Preliminary Mortgage
Schedule with
those Mortgage Loans which have not been funded prior to the
related Closing
Date deleted.
ARTICLE IV
PURCHASE PRICE
Section 4.01 Purchase Price.
The Purchase Price for each Mortgage Loan shall be the percentage
of
par as stated in the related Purchase Price and Terms Agreement
(subject to
adjustment as provided therein), multiplied by the aggregate
principal balance,
as of the related Cut-off Date, of the Mortgage Loans listed on the
related
Mortgage Loan Schedule, after application of scheduled payments of
principal due
on or before the related Cut-off Date, but only to the extent such
payments were
actually received. The initial principal amount of the related
Mortgage Loans
shall be the aggregate principal balance of the Mortgage Loans, so
computed as
of the related Cut-off Date. If so provided in the related Purchase
Price and
Terms Agreement, portions of the Mortgage Loans shall be priced
separately.
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In addition to the Purchase Price as described above, the
Purchaser
shall pay to the Seller, at closing, accrued interest on the
current principal
amount of the related Mortgage Loans as of the related Cut-off Date
at the
weighted average Mortgage Interest Rate of those Mortgage Loans.
The Purchase
Price plus accrued interest as set forth in the preceding paragraph
shall be
paid to the Seller by wire transfer of immediately available funds
to an account
designated by the Seller in writing.
The Purchaser shall be entitled to (1) all scheduled principal
due
after the related Cut-off Date, (2) all other recoveries of
principal collected
on or after the related Cut-off Date, and (3) all payments of
interest on the
Mortgage Loans net of applicable Servicing Fees (minus that portion
of any such
payment which is allocable to the period prior to the related
Cut-off Date). The
outstanding principal balance of each Mortgage Loan as of the
related Cut-off
Date is determined after application of payments of principal due
on or before
the related Cut-off Date, to the extent actually collected,
together with any
unscheduled principal prepayments collected prior to such Cut-off
Date;
provided, however, that payments of scheduled principal and
interest paid prior
to such Cut-off Date, but to be applied on a Due Date beyond the
related Cut-off
Date shall not be applied to the principal balance as of the
related Cut-off
Date. Such prepaid amounts shall be the property of the Purchaser.
The Seller
shall deposit any such prepaid amounts into the collection account,
which
account is established for the benefit of the Purchaser for
subsequent
remittance by the Seller to the Purchaser.
ARTICLE V
EXAMINATION OF MORTGAGE FILES
Section 5.01 Examination of Mortgage Files.
At least ten (10) Business Days prior to the related Closing Date,
the
Seller shall (a) deliver to the Purchaser or its designee in
escrow, for
examination with respect to each Mortgage Loan to be purchased, the
related
Mortgage File, including a copy of the Assignment of Mortgage,
pertaining to
each Mortgage Loan, or (b) make the related Mortgage File available
to the
Purchaser for examination at such other location as shall otherwise
be
acceptable to the Purchaser. Such examination may be made by the
Purchaser or
its designee at any reasonable time before or after the related
Closing Date. If
the Purchaser makes such examination prior to the related Closing
Date and
determines, in its sole discretion, that any Mortgage Loans are
unacceptable to
the Purchaser for any reason, such Mortgage Loans shall be deleted
from the
related Mortgage Loan Schedule, and may be replaced by a Qualified
Substitute
Mortgage Loan (or Loans) acceptable to the Purchaser. The Purchaser
may, at its
option and without notice to the Seller, purchase some or all of
the Mortgage
Loans without conducting any partial or complete examination. The
fact that the
Purchaser or its designee has conducted or has failed to conduct
any partial or
complete examination of the Mortgage Files shall not affect the
Purchaser's (or
any of its successor's) rights to demand repurchase, substitution
or other
relief as provided herein.
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ARTICLE VI
CONVEYANCE FROM SELLER TO PURCHASER
Section 6.01 Conveyance of Mortgage Loans.
The Seller, simultaneously with the delivery of the Mortgage
Loan
Schedule with respect to the related Mortgage Loan Package to be
purchased on
each Closing Date, shall execute and deliver an Assignment and
Conveyance
Agreement in the form attached hereto as Exhibit H (the "Assignment
and
Conveyance Agreement"). The Seller shall cause the Servicing File
retained by
the Seller pursuant to this Agreement to be appropriately
identified in the
Seller's computer system and/or books and records, as appropriate,
to clearly
reflect the sale of the related Mortgage Loan to the Purchaser. The
Seller shall
release from its custody the contents of any Servicing File
retained by it only
in accordance with this Agreement, except when such release is
required in
connection with a repurchase of any such Mortgage Loan pursuant to
Section 9.03.
Section 6.02 Books and Records.
Record title to each Mortgage as of the related Closing Date shall
be
in the name of the Seller, an Affiliate of the Seller, the
Purchaser or one or
more designees of the Purchaser, as the Purchaser shall select.
Notwithstanding
the foregoing, each Mortgage and related Mortgage Note shall be
possessed solely
by the Purchaser or the appropriate designee of the Purchaser, as
the case may
be. All rights arising out of the Mortgage Loans including, but not
limited to,
all funds received by the Seller after the related Cut-off Date on
or in
connection with a Mortgage Loan shall be vested in the Purchaser or
one or more
designees of the Purchaser; provided, however, that all funds
received on or in
connection with a Mortgage Loan shall be received and held by the
Seller in
trust for the benefit of the Purchaser or the appropriate designee
of the
Purchaser, as the case may be, as the owner of the Mortgage Loans
pursuant to
the terms of this Agreement.
The Seller shall be responsible for maintaining, and shall
maintain, a
complete set of books and records for each Mortgage Loan which
shall be marked
clearly to reflect the ownership of each Mortgage Loan by the
Purchaser. In
particular, the Seller shall maintain in its possession, available
for
inspection by the Purchaser, and shall deliver to the Purchaser
upon demand,
evidence of compliance with all federal, state and local laws,
rules and
regulations, and requirements of Fannie Mae or Freddie Mac,
including but not
limited to documentation as to the method used in determining the
applicability
of the provisions of the National Flood Insurance Act of 1968, as
amended, to
the Mortgaged Property, documentation evidencing insurance coverage
and periodic
inspection reports, as required by the Fannie Mae Guides. To the
extent that
original documents are not required for purposes of realization of
Liquidation
Proceeds or Insurance Proceeds, documents maintained by the Seller
may be in the
form of microfilm or microfiche so long as the Seller complies with
the
requirements of the Fannie Mae Guides.
The sale of each Mortgage Loan shall be reflected on the
Seller's
balance sheet and other financial statements as a sale of assets by
the Seller.
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Section 6.03 Delivery of Mortgage Loan Documents.
The Seller shall deliver and release to the Custodian no later
than
two (2) Business Days prior to the related Closing Date those
Mortgage Loan
Documents set forth on Exhibit A hereto as required by the
Custodial Agreement
with respect to each Mortgage Loan set forth on the related
Mortgage Loan
Schedule.
The Custodian shall certify its receipt of all such Mortgage
Loan
Documents required to be delivered pursuant to the Custodial
Agreement for the
related Closing Date, as evidenced by the Initial Certification of
the Custodian
in the form annexed to the Custodial Agreement. The Seller shall
comply with the
terms of the Custodial Agreement and the Purchaser shall pay all
fees and
expenses of the Custodian.
The Seller shall forward to the Custodian, or to such other Person
as
the Purchaser shall designate in writing, original documents
evidencing an
assumption, modification, consolidation or extension of any
Mortgage Loan
entered into in accordance with this Agreement within two weeks of
their
execution, provided, however, that the Seller shall provide the
Custodian, or to
such other Person as the Purchaser shall designate in writing, with
a certified
true copy of any such document submitted for recordation within two
weeks of its
execution, and shall promptly 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 any document required to be delivered to the Custodian
in
the Custodial Agreement, including an original or copy of any
document submitted
for recordation to the appropriate public recording office, is not
so delivered
to the Custodian, or to such other Person as the Purchaser shall
designate in
writing, within 180 days following the related Closing Date (other
than with
respect to the Assignments of Mortgage which shall be delivered to
the Custodian
in blank and recorded subsequently by the Purchaser or its
designee), and in the
event that the Seller does not cure such failure within 30 days of
discovery or
receipt of written notification of such failure from the Purchaser,
the related
Mortgage Loan shall, upon the request of the Purchaser, be
repurchased by the
Seller at the price and in the manner specified in Section 9.03.
The foregoing
repurchase obligation shall not apply in the event that the Seller
cannot
deliver an original document submitted for recordation to the
appropriate public
recording office within the specified period due to a delay caused
by the
recording office in the applicable jurisdiction; provided that the
Seller shall
instead deliver a recording receipt of such recording office or, if
such
recording receipt is not available, an officer's certificate of a
servicing
officer of the Seller, confirming that such documents have been
accepted for
recording; provided that, upon request of the Purchaser and
delivery by the
Purchaser to the Seller of a schedule of the related Mortgage
Loans, the Seller
shall reissue and deliver to the Purchaser or its designee said
officer's
certificate.
The Seller shall pay all initial recording fees, if any, for
the
assignments of mortgage and any other fees or costs in transferring
all original
documents to the Custodian or, upon written request of the
Purchaser, to the
Purchaser or the Purchaser's designee. The Purchaser or the
Purchaser's designee
shall be responsible for recording the Assignments of
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Mortgage and shall be reimbursed by the Seller for the costs
associated
therewith pursuant to the preceding sentence.
Section 6.04 Quality Control Procedures.
The Seller shall have an internal quality control program that
verifies, on a regular basis, the existence and accuracy of the
legal documents,
credit documents, property appraisals, and underwriting decisions.
The program
shall include evaluating and monitoring the overall quality of the
Seller's loan
production and servicing activities. The program is to ensure that
the Mortgage
Loans are originated and serviced in accordance with Accepted
Servicing
Standards and the Underwriting Guidelines; guard against dishonest,
fraudulent,
or negligent acts; and guard against errors and omissions by
officers,
employees, or other authorized persons.
Section 6.05 MERS Designated Loans.
With respect to each MERS Designated Mortgage Loan, the Seller
shall,
on or prior to the related Closing Date, designate the Purchaser as
the Investor
and the Custodian as custodian, and no Person shall be listed as
Interim Funder
on the MERS System. In addition, on or prior to the related Closing
Date, Seller
shall provide the Custodian and the Purchaser with a MERS Report
listing the
Purchaser as the Investor, the Custodian as custodian and no Person
as Interim
Funder with respect to each MERS Designated Mortgage Loan.
ARTICLE VII
SERVICING OF THE MORTGAGE LOANS
Section 7.01 Servicing.
The Mortgage Loans have been sold by the Seller to the Purchaser on
a
servicing released basis. Subject to, and upon the terms and
conditions of this
Agreement, the Seller hereby sells, transfers, assigns, conveys and
delivers to
the Purchaser the Servicing Rights.
The
Purchaser shall retain the Seller as contract servicer of the
Mortgage Loans for an interim period pursuant to and in accordance
with the
terms and conditions set forth in this section provided that if the
related
Transfer Date has not occurred on or prior to the date which is 60
days after
the related Closing Date, the Purchaser and the Seller hereby agree
to negotiate
in good faith and enter into a more detailed interim servicing
agreement
mutually acceptable to the parties. The Seller shall service the
Mortgage Loans
on an "actual/actual" basis and otherwise in accordance with the
Accepted
Servicing Practices and the following provisions of this section.
The Seller
shall be entitled to a servicing fee as provided in the related
Purchase Price
and Terms Agreement.
[In servicing the Mortgage Loans, the Seller shall comply with
all
applicable laws, rules and regulations with respect thereto. The
Seller shall
take no action with respect to any Mortgage Loan, including
entering into any
litigation, or any agreement with the related Mortgagor, without
the prior
written consent of the Purchaser. The Seller shall promptly notify
the Purchaser
in writing of any action which should be taken with respect to any
Mortgage Loan
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in accordance with Accepted Servicing Practices. The Seller shall
take no
action, and shall not refrain from taking action, which, in either
case, (a)
would impair the ability of the Purchaser to realize on or enforce
the Mortgage
Note or the lien of the Mortgage or any other document related
thereto or (b)
would jeopardize the rights or remedies available to the Purchaser
with respect
to any Mortgage Loan or otherwise impair the ability of the
Purchaser to realize
on the Mortgaged Property with respect to such Mortgage Loan.
The Seller shall be obligated to make all advances on the
Mortgage
Loans with respect to taxes and insurance premiums due and owing
(the "T&I
Servicing Advances"). Any other servicing advances in excess of
$1500 shall be
made with the prior written consent of the Purchaser. The Seller
shall be
required to notify the Purchaser in writing of all advances in
excess of $1500
required to be made in order to further protect and preserve the
Purchaser's
interest in the Mortgage Loans and the underlying Mortgaged
Property (the "Other
Servicing Advances," together with the T&I Servicing Advances,
the "Servicing
Advances"), and shall make such Other Servicing Advances in a
timely fashion
unless otherwise instructed by the Purchaser. The Seller shall be
entitled to
reimbursement for all Servicing Advances from the Purchaser within
15 Business
Days following the Transfer Date.
The Seller shall segregate and hold all funds collected and
received
pursuant to the Mortgage Loans, including Escrow Payments, separate
and apart
from any of their own funds and general assets in one or more
collection
accounts, each of which shall be Eligible Accounts.
The Seller shall remit to the Purchaser on each Remittance Date
all
amounts received from any source with respect to the Mortgage
Loans. On or prior
to each Remittance Date the Seller shall deliver to the Purchaser a
remittance
advice in electronic format acceptable to the Purchaser as to the
accompanying
remittance and the period ending on the related Determination Date
and shall
additionally specify the number of days which each Mortgage Loan is
delinquent,
and shall contain an explanation of all Servicing Advances made,
the status of
all Mortgage Loans in foreclosure or otherwise the subject of
litigation, and
the status of all other collection efforts with respect to each
Mortgage Loan.]
Section 7.02 Transfer of Servicing.
On the applicable Transfer Date, the Purchaser, or its designee,
shall
assume all servicing responsibilities related to, and the Seller
shall cease all
servicing responsibilities related to, the related Mortgage Loans
subject to
such Transfer Date. The Transfer Date shall be the date determined
in accordance
with Section 7 herein.
On or prior to the applicable Transfer Date, the Seller shall,
at
their sole cost and expense, take such steps as may be necessary or
appropriate
to effectuate and evidence the transfer of the servicing of the
related Mortgage
Loans to the Purchaser, or its designee, including but not limited
to the
following:
(a) Notice to Mortgagors. The Seller shall mail to the Mortgagor
of
each related Mortgage Loan a letter advising such Mortgagor of the
transfer of
the servicing of the related Mortgage Loan to the Purchaser, or its
designee, in
accordance with the Cranston Gonzales National Affordable Housing
Act of 1990;
provided, however, the content and format
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of the letter shall have the prior approval of the Purchaser. The
Seller shall
provide the Purchaser with copies of all such related notices no
later than the
Transfer Date.
(b) Notice to Insurance Companies. The Seller shall transmit to
the
applicable insurance companies (including primary mortgage
insurance policy
insurers, if applicable) and/or agents, notification of the
transfer of the
servicing to the Purchaser, or its designee, and instructions to
deliver all
notices, tax bills and insurance statements, as the case may be, to
the
Purchaser from and after the Transfer Date. The Seller shall
provide the
Purchaser with copies of all such notices no later than the
Transfer Date.
(c) Delivery of Servicing Records. The Seller shall forward to
the
Purchaser, or its designee, all servicing records and the Servicing
File in the
Seller's possession relating to each related Mortgage Loan.
(d) Escrow Payments. The Seller shall provide the Purchaser, or
its
designee, with immediately available funds by wire transfer in the
amount of the
net Escrow Payments and suspense balances and all loss draft
balances associated
with the related Mortgage Loans. The Seller shall provide the
Purchaser with an
accounting statement, in electronic format acceptable to the
Purchaser in its
sole discretion, of Escrow Payments and suspense balances and loss
draft
balances sufficient to enable the Purchaser to reconcile the amount
of such
payment with the accounts of the Mortgage Loans. Additionally, the
Seller shall
wire transfer to the Purchaser the amount of any agency, trustee or
prepaid
Mortgage Loan payments and all other similar amounts held by the
Seller.
(e) Payoffs and Assumptions. The Seller shall provide to the
Purchaser, or its designee, copies of all assumption and payoff
statements
generated by the Seller on the related Mortgage Loans from the
related Cut-off
Date to the Transfer Date.
(f) Mortgage Payments Received Prior to Transfer Date. Prior to
the
Transfer Date all payments received by the Seller on each related
Mortgage Loan
shall be properly applied by the Seller to the account of the
particular
Mortgagor.
(g) Mortgage Payments Received after Transfer Date. The amount of
any
related Monthly Payments received by the Seller after the Transfer
Date shall be
forwarded to the Purchaser by overnight mail on the Business Day
following the
date of receipt. The Seller shall notify the Purchaser of the
particulars of the
payment, which notification requirement shall be satisfied if the
Seller forward
with their payment sufficient information to permit appropriate
processing of
the payment by the Purchaser. The Seller shall assume full
responsibility for
the necessary and appropriate legal application of such Monthly
Payments
received by the Seller after the Transfer Date with respect to
related Mortgage
Loans then in foreclosure or bankruptcy; provided, for purposes of
this
Agreement, necessary and appropriate legal application of such
Monthly Payments
shall include, but not be limited to, endorsement of a Monthly
Payment to the
Purchaser with the particulars of the payment such as the account
number, dollar
amount, date received and any special Mortgagor application
instructions and the
Seller shall comply with the foregoing requirements with respect to
all Monthly
Payments received by the Seller after the Transfer Date.
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(h) Misapplied Payments. Misapplied payments shall be processed
as
follows:
(i) All parties shall cooperate in correcting misapplication
errors;
(ii) The party receiving notice of a misapplied payment
occurring
prior to the applicable Transfer Date and discovered after the
Transfer Date
shall immediately notify the other party in writing;
(iii) If a misapplied payment which occurred prior to the
Transfer
Date cannot be identified and said misapplied payment has resulted
in a
shortage, the Seller shall be liable for the amount of such
shortage. The Seller
shall reimburse the Purchaser for the amount of such shortage
within thirty (30)
days after receipt of written demand therefor from the
Purchaser;
(iv) If a misapplied payment which occurred prior to the Transfer
Date
has created an improper Purchase Price as the result of an
inaccurate
outstanding principal balance, a check shall be issued to the party
shorted by
the improper payment application within seven (7) Business Days
after notice
thereof by the other party; and
(v) Any check issued under the provisions of this Section
7.02(h)
shall be accompanied by a statement indicating the corresponding
Seller and/or
the Purchaser Mortgage Loan identification number and an
explanation of the
allocation of any such payments.
(i) Books and Records. On the Transfer Date, the books, records
and
accounts of the Seller with respect to the related Mortgage Loans
shall be in
accordance with all applicable Purchaser requirements.
(j) Reconciliation. The Seller shall, on or before the Transfer
Date,
reconcile principal balances and make any monetary adjustments
required by the
Purchaser. Any such monetary adjustments will be transferred
between the Seller
and the Purchaser as appropriate.
(k) IRS Forms. The Seller shall file all IRS forms 1099, 1099A,
1098
or 1041 and K-1 which are required to be filed on or before the
Transfer Date in
relation to the servicing and ownership of the related Mortgage
Loans. The
Seller shall provide copies of such forms to the Purchaser upon
request and
shall reimburse the Purchaser for any costs or penalties incurred
by the
Purchaser due to either Seller's failure to comply with this
paragraph.
ARTICLE VIII
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[RESERVED]
ARTICLE IX
REPRESENTATIONS, WARRANTIES AND COVENANTS
OF THE SELLER; REMEDIES FOR BREACH
Section 9.01 Representations and Warranties Regarding the
Seller.
The Seller represents, warrants and covenants to the Purchaser that
as
of the date hereof and as of each Closing Date:
(a) Due Organization and Authority. The Seller is a duly
organized,
validly existing, and in good standing under the laws of New York
and has all
licenses necessary to carry on its business as now being conducted
and is
licensed, qualified and in good standing in the states where the
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 Seller.
The Seller has
corporate power and authority to execute and deliver this Agreement
and to
perform its obligations hereunder; the execution, delivery and
performance of
this Agreement (including all instruments of transfer to be
delivered pursuant
to this Agreement) by the Seller and the consummation of the
transactions
contemplated hereby have been duly and validly authorized; this
Agreement has
been duly executed and delivered and constitutes the valid, legal,
binding and
enforceable obligation of the Seller, except as enforceability may
be limited by
(i) bankruptcy, insolvency, liquidation, receivership,
moratorium,
reorganization or other similar laws affecting the enforcement of
the rights of
creditors and (ii) general principles of equity, whether
enforcement is sought
in a proceeding in equity or at law. All requisite corporate action
has been
taken by the Seller to make this Agreement valid and binding upon
the Seller in
accordance with its terms;
(b) No Consent Required. No consent, approval, authorization or
order
is required for the transactions contemplated by this Agreement
from any court,
governmental agency or body, or federal or state regulatory
authority having
jurisdiction over the Seller is required or, if required, such
consent,
approval, authorization or order has been or will, prior to the
related Closing
Date, be obtained;
(c) Ordinary Course of Business. The consummation of the
transactions
contemplated by this Agreement are in the ordinary course of
business of the
Seller, and the transfer, assignment and conveyance of the Mortgage
Notes and
the Mortgages by the Seller pursuant to this Agreement are not
subject to the
bulk transfer or any similar statutory provisions in effect in any
applicable
jurisdiction;
(d) No Conflicts. Neither the execution and delivery of this
Agreement, the acquisition or origination of the Mortgage Loans by
the Seller,
the sale of the Mortgage Loans to the Purchaser, the consummation
of 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 Seller's
charter, by-laws
or other organizational documents or any legal restriction or any
agreement or
instrument to which the
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Seller 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
Seller or its
property is subject, or result in the creation or imposition of any
lien, charge
or encumbrance that would have an adverse effect upon any of its
properties
pursuant to the terms of any mortgage, contract, deed of trust or
other
instrument, or impair the ability of the Purchaser to realize on
the Mortgage
Loans, impair the value of the Mortgage Loans;
(e) No Litigation Pending. Except as publicly disclosed in the
filings
with the Securities and Exchange Commission made by MortgageIT
Holdings, Inc.,
the Seller's parent corporation, there is no action, suit,
proceeding or
investigation pending or, to the knowledge of the Seller threatened
against the
Seller, before any court, administrative agency or other tribunal
asserting the
invalidity of this Agreement, seeking to prevent the consummation
of any of the
transactions contemplated by this Agreement or 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
Seller, or in any
material impairment of the right or ability of the Seller to carry
on its
business substantially as now conducted, or in any material
liability on the
part of the Seller, or which would draw into question the validity
of this
Agreement or the Mortgage Loans or of any action taken or to be
taken in
connection with the obligations of the Seller contemplated herein,
or which
would be likely to impair materially the ability of the Seller to
perform under
the terms of this Agreement;
(f) Ability to Perform; Solvency. The Seller 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 Seller is solvent
and the sale
of the Mortgage Loans will not cause the Seller to become
insolvent. The sale of
the Mortgage Loans is not undertaken with the intent to hinder,
delay or defraud
any of Seller's creditors;
(g) Seller's Origination. The Seller's decision to originate
any
mortgage loan or to deny any mortgage loan application is an
independent
decision based upon the Underwriting Guidelines, and is in no way
made as a
result of Purchaser's decision to purchase, or not to purchase, or
the price
Purchaser may offer to pay for, any such mortgage loan, if
originated;
(h) Anti-Money Laundering Laws. The Seller has complied with
all
applicable anti-money laundering laws, regulations and executive
orders,
including without limitation the USA Patriot Act of 2001
(collectively, the
"Anti-Money Laundering Laws"); the Seller has established an
anti-money
laundering compliance program as required by the Anti-Money
Laundering Laws, has
conducted the requisite due diligence in connection with the
origination of each
Mortgage Loan for purposes of the Anti-Money Laundering Laws,
including with
respect to the legitimacy of the applicable Mortgagor and the
origin of the
assets used by the said Mortgagor to purchase the property in
question, and
maintains, and will maintain, sufficient information to identify
the applicable
Mortgagor for purposes of the Anti-Money Laundering Laws.
Additionally, no
Mortgage Loan is subject to nullification pursuant to Executive
Order 13224 (the
"Executive Order") or the regulations promulgated by the Office of
Foreign
Assets Control of the United States Department of Treasury (the
"OFAC
Regulations") or in violation of the Executive Order or the OFAC
Regulations;
and no Mortgagor is subject to
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the provisions of such Executive Order or the OFAC Regulations nor
listed as a
"blocked person" for purposes of the OFAC Regulations;
(i) Financial Statements. The Seller has delivered to the
Purchaser
financial statements as to its last three complete fiscal years and
any later
quarter ended more than 60 days prior to the execution of this
Agreement. All
such financial statements fairly present in all material respects
the pertinent
results of operations and changes in financial position for each of
such periods
and the financial position at the end of each such period of the
Seller and its
subsidiaries and have been prepared in accordance with generally
accepted
accounting principles consistently applied throughout the periods
involved,
except as set forth in the notes thereto. There has been no change
in the
business, operations, financial condition, properties or assets of
the Seller
since the date of the Seller's financial statements that would have
a material
adverse effect on its ability to perform its obligations under this
Agreement;
(j) Selection Process. The Mortgage Loans were selected from among
the
outstanding mortgage loans in the Seller's portfolio at the related
Closing Date
as to which the representations and warranties set forth in Section
9.02 could
be made and such selection was not made in a manner so as to affect
adversely
the interests of the Purchaser;
(k) Delivery to the Custodian. The Mortgage Note, the Mortgage,
the
Assignment of Mortgage and any other documents required to be
delivered with
respect to each Mortgage Loan pursuant to the Custodial Agreement,
shall be
delivered to the Custodian all in compliance with the specific
requirements of
the Custodial Agreement. With respect to each Mortgage Loan, the
Seller will be
in possession of a complete Mortgage File in compliance with
Exhibit A hereto,
except for such documents as will be delivered to the
Custodian;
(l) Mortgage Loan Characteristics. The characteristics of the
related
Mortgage Loan Package are as set forth on the description of the
pool
characteristics for the applicable Mortgage Loan Package delivered
pursuant to
Article XI on the related Closing Date in the form attached as
Exhibit B to each
related Assignment and Conveyance Agreement;
(m) No Untrue Information. Neither this Agreement nor any
information,
statement, tape, diskette, report, form, or other document
furnished or to be
furnished pursuant to this Agreement or any Reconstitution
Agreement or in
connection with the transactions contemplated hereby (including
any
Securitization Transaction or Whole Loan Transfer) contains any
untrue statement
of fact or omits to state a fact necessary to make the statements
contained
herein or therein not misleading;
(n) No Brokers. The Seller has not dealt with any broker,
investment
banker, agent or other person that may be entitled to any
commission or
compensation in connection with the sale of the Mortgage Loans;
(o) Sale Treatment. The Seller intends to reflect the transfer of
the
Mortgage Loans as a sale on the books and records of the Seller and
the Seller
has determined that the disposition of the Mortgage Loans pursuant
to this
Agreement will be afforded sale treatment for tax and accounting
purposes;
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<PAGE>
(p) Owner of Record. The Seller is the owner of record of each
Mortgage and the indebtedness evidenced by each Mortgage Note,
except for the
Assignments of Mortgage which have been sent for recording, and
upon recordation
the Seller will be the owner of record of each Mortgage and the
indebtedness
evidenced by each Mortgage Note, and upon the sale of the Mortgage
Loans to the
Purchaser, the Seller will retain the Mortgage Files with respect
thereto in
trust only for the purpose of servicing and supervising the
servicing of each
Mortgage Loan;
(q) Reasonable Purchase Price. The consideration received by
the
Seller upon the sale of the Mortgage Loans under this Agreement
constitutes fair
consideration and reasonably equivalent value for the Mortgage
Loans; and
(r) Credit Reporting. The Seller shall fully furnish, in
accordance
with the Fair Credit Reporting Act and its implementing
regulations, accurate
and complete information (e.g., favorable and unfavorable) on its
borrower
credit files to Equifax, Experian and Trans Union Credit
Information Company
(three of the credit repositories), on a monthly basis.
Additionally, the Seller
shall transmit full-file credit reporting data for each Mortgage
Loan pursuant
to Fannie Mae Guide Announcement 95-19 and that for each Mortgage
Loan, the
Seller shall agree to report one of the following statuses each
month as
follows: new origination, current, delinquent (30-, 60-, 90-days,
etc.),
foreclosed, or charged-off. This representation and warranty is a
Deemed
Material and Adverse Representation.
Section 9.02 Representations and Warranties Regarding
Individual
Mortgage Loans.
The Seller hereby represents and warrants to the Purchaser that, as
to
each Mortgage Loan, as of the related Closing Date for such
Mortgage Loan:
(a) Mortgage Loans as Described. The information set forth in
the
related Mortgage Loan Schedule is complete, true and correct;
(b) Payments Current. All payments required to be made up to
the
related Closing Date for the Mortgage Loan under the terms of the
Mortgage Note,
other than payments not yet thirty (30) days delinquent, have been
made and
credited. No payment required under the Mortgage Loan is thirty
(30) days or
more delinquent nor has any payment under the Mortgage Loan been
thirty (30)
days or more delinquent at any time since the origination of the
Mortgage Loan,
other than as set forth on the related Mortgage Loan Schedule;
(c) No Outstanding Charges. There are no defaults in complying
with
the terms of the Mortgage, and all taxes, governmental assessments,
insurance
premiums, water, sewer and municipal charges, leasehold payments or
ground rents
which previously became due and owing have been paid, or an escrow
of funds has
been established in an amount sufficient to pay for every such item
which
remains unpaid and which has been assessed but is not yet due and
payable. The
Seller has not advanced funds, or induced, solicited or knowingly
received any
advance of funds by a party other than the Mortgagor, directly or
indirectly,
for the payment of any amount required under the Mortgage Loan,
except for
interest accruing from the date of the Mortgage Note or date of
disbursement of
the Mortgage Loan proceeds, whichever is earlier, to
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the day which precedes by one month the related Due Date of the
first
installment of principal and interest;
(d) Original Terms Unmodified. The terms of the Mortgage Note
and
Mortgage have not been impaired, waived, altered or modified in any
respect,
from the date of origination except by a written instrument which
has been
recorded, if necessary to protect the interests of the Purchaser,
and which has
been delivered to the Custodian or to such other Person as the
Purchaser shall
designate in writing, and the terms of which are reflected in the
related
Mortgage Loan Schedule. The substance of any such waiver,
alteration or
modification has been approved by the issuer of any related PMI
Policy and the
title insurer, if any, to the extent required by the policy, and
its terms are
reflected on the related Mortgage Loan Schedule, if applicable. No
Mortgagor has
been released from the obligations of the related Mortgage Loan, in
whole or in
part, except in connection with an assumption agreement, approved
by the issuer
of any related PMI Policy and the title insurer, to the extent
required by the
policy, and which assumption agreement is part of the Mortgage Loan
File
delivered to the Custodian or to such other Person as the Purchaser
shall
designate in writing and the terms of which are reflected in the
related
Mortgage Loan Schedule;
(e) No Defenses. The Mortgage Loan is not subject to any right
of
rescission, set-off, counterclaim or defense, including without
limitation the
defense of usury, nor will the operation of any of the terms of the
Mortgage
Note or the Mortgage, or the exercise of any right thereunder,
render either the
Mortgage Note or the Mortgage unenforceable, in whole or in part
and no such
right of rescission, set-off, counterclaim or defense has been
asserted with
respect thereto, and no Mortgagor was a debtor in any state or
Federal
bankruptcy or insolvency proceeding at the time the Mortgage Loan
was
originated;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage,
all
buildings or other improvements upon the Mortgaged Property are
insured by a
generally acceptable insurer against loss by fire, hazards of
extended coverage
and such other hazards as are provided for in the Fannie Mae Guides
or by
Freddie Mac. If required by the National Flood Insurance Act of
1968, as
amended, each Mortgage Loan is covered by a flood insurance policy
meeting the
requirements of the current guidelines of the Federal Insurance
Administration
as in effect, which policy conforms to Fannie Mae or Freddie Mac
requirements.
All individual insurance policies contain a standard mortgagee
clause naming the
Seller and its successors and assigns as mortgagee, and all
premiums thereon
have been paid. The Mortgage obligates the Mortgagor thereunder to
maintain the
hazard insurance policy at the Mortgagor's cost and expense, and on
the
Mortgagor's failure to do so, authorizes the holder of the Mortgage
to obtain
and maintain such insurance at such Mortgagor's cost and expense,
and to seek
reimbursement therefor from the Mortgagor. Where required by state
law or
regulation, the Mortgagor has been given an opportunity to choose
the carrier of
the required hazard insurance, provided the policy is not a
"master" or
"blanket" hazard insurance policy covering a condominium, or any
hazard
insurance policy covering the common facilities of a planned unit
development.
The hazard insurance policy is in full force and effect, and will
not be
cancelled or otherwise nullified upon the consummation of the
transactions
contemplated by this Agreement. The Seller has not engaged in, and
has no
knowledge of the Mortgagor's having engaged in, any act or omission
which would
impair the coverage of any such policy, the benefits of the
endorsement provided
for herein, or the validity and binding effect of either including,
without
limitation, no unlawful fee,
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commission, kickback or other unlawful compensation or value of any
kind has
been or will be received, retained or realized by any attorney,
firm or other
person or entity, and no such unlawful items have been received,
retained or
realized by the Seller;
(g) Compliance with Applicable Laws. Any and all requirements of
any
federal, state or local law including, without limitation,
usury,
truth-in-lending, real estate settlement procedures, consumer
credit protection,
equal credit opportunity, disclosure and all predatory, abusive and
fair lending
laws applicable to the Mortgage Loan, including, without
limitation, any
provisions relating to the Illinois Interest Act and Prepayment
Penalties, have
been complied with, the consummation of the transactions
contemplated hereby
will not involve the violation of any such laws or regulations, and
the Seller
shall maintain in its possession, available for the Purchaser's
inspection, and
shall deliver to the Purchaser upon demand, evidence of compliance
with all such
requirements. This representation and warranty is a Deemed Material
and Adverse
Representation;
(h) No Satisfaction of Mortgage. The Mortgage has not been
satisfied,
canceled, subordinated or rescinded, in whole or in part, and the
Mortgaged
Property has not been released from the lien of the Mortgage, in
whole or in
part, nor has any instrument been executed that would effect any
such release,
cancellation, subordination or rescission. The Seller has not
waived the
performance by the Mortgagor of any action, if the Mortgagor's
failure to
perform such action would cause the Mortgage Loan to be in default,
nor has the
Seller waived any default resulting from any action or inaction by
the
Mortgagor;
(i) Type of Mortgaged Property. With respect to a Mortgage Loan
that
is not a Co-op Loan, the Mortgaged Property is a fee simple estate
[or a
leasehold estate located in a jurisdiction in which the use of a
leasehold
estate for residential properties is a widely accepted practice]
that consists
of a single parcel of real property with a detached single family
residence
erected thereon, or a two- to four-family dwelling, or an
individual residential
condominium unit in a condominium project, or an individual unit in
a planned
unit development, or an individual unit in a residential
cooperative housing
corporation; provided, however, that any condominium unit, planned
unit
development or residential cooperative housing corporation shall
conform with
the Underwriting Guidelines. No portion of the Mortgaged Property
(or underlying
Mortgaged Property, in the case of a Co-op Loan) is used for
commercial
purposes, and since the date of origination, no portion of the
Mortgaged
Property has been used for commercial purposes; provided, that
Mortgaged
Properties which contain a home office shall not be considered as
being used for
commercial purposes as long as the Mortgaged Property has not been
altered for
commercial purposes and is not storing any chemicals or raw
materials other than
those commonly used for homeowner repair, maintenance and/or
household purposes.
None of the Mortgaged Properties are manufactured homes, log homes,
mobile
homes, geodesic domes or other unique property types;
(j) Valid First or Second Lien. The Mortgage is a valid,
subsisting,
enforceable and perfected, first lien (with respect to a First Lien
Loan) or
second lien (with respect to a Second Lien Loan) on the Mortgaged
Property,
including all buildings and improvements on the Mortgaged Property
and all
installations and mechanical, electrical, plumbing, heating and air
conditioning
systems located in or annexed to such buildings, and all
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additions, alterations and replacements made at any time with
respect to the
foregoing. The lien of the Mortgage is subject only to:
(i) with respect
to a Second Lien Loan only, the lien of the
first mortgage on the Mortgaged Property;
(ii) the lien of
current real property taxes and assessments not
yet due and payable;
(iii) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the
date of recording acceptable to prudent mortgage lending
institutions generally and specifically referred to in the
lender's title insurance policy delivered to the originator
of the Mortgage Loan and (a) specifically referred to or
otherwise considered in the appraisal made for the
originator of the Mortgage Loan or (b) which do not
adversely affect the Appraised Value set forth in such
appraisal; and
(iv) other matters to
which like properties are commonly subject
which do not materially interfere with the benefits of the
security intended to be provided by the Mortgage or the
use, enjoyment, value or marketability of the related
Mortgaged Property.
Any security agreement, chattel mortgage or equivalent document
related to and delivered in connection with the Mortgage Loan
establishes and
creates a valid, subsisting, enforceable and perfected first lien
(with respect
to a First Lien Loan) or second lien (with respect to a Second Lien
Loan) and
first priority (with respect to a First Lien Loan) or second
priority (with
respect to a Second Lien Loan) security interest on the property
described
therein and the Seller has full right to sell and assign the same
to the
Purchaser.
(k) Valid First or Second Priority Security Interest. With respect
to
any Co-op Loan, the related Mortgage is a valid, subsisting,
enforceable and
perfected, first priority security interest (with respect to a
First Lien Loan)
or second priority security interest (with respect to a Second Lien
Loan) on the
related cooperative shares securing the Mortgage Note, subject only
to (a) liens
of the related residential cooperative housing corporation for
unpaid
assessments representing the Mortgagor's pro rata share of the
related
residential cooperative housing corporation's payments for its
blanket mortgage,
current and future real property taxes, insurance premiums,
maintenance fees and
other assessments to which like collateral is commonly subject and
(b) other
matters to which like collateral is commonly subject which do not
materially
interfere with the benefits of the security interest intended to be
provided by
the related Security Agreement;
(l) [Reserved].
(m) Validity of Mortgage Documents. The Mortgage Note and the
Mortgage
and any other agreement executed and delivered by a Mortgagor in
connection with
a Mortgage Loan are genuine, and each is the legal, valid and
binding obligation
of the maker thereof enforceable in accordance with its terms
(including,
without limitation, any provisions therein
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relating to Prepayment Penalties). All parties to the Mortgage
Note, the
Mortgage and any other such related agreement had legal capacity to
enter into
the Mortgage Loan and to execute and deliver the Mortgage Note, the
Mortgage and
any such agreement, and the Mortgage Note, the Mortgage and any
other such
related agreement have been duly and properly executed by other
such related
parties. No fraud, error, omission, misrepresentation, negligence
or similar
occurrence with respect to a Mortgage Loan has taken place on the
part of the
Seller in connection with the origination of the Mortgage Loan or
in the
application of any insurance in relation to such Mortgage Loan. No
fraud, error,
omission, misrepresentation, negligence or similar occurrence with
respect to a
Mortgage Loan has taken place on the part of any Person, including
without
limitation, the Mortgagor, any appraiser, any builder or developer,
or any other
party involved in the origination of the Mortgage Loan or in the
application for
any insurance in relation to such Mortgage Loan. The Seller has
reviewed all of
the documents constituting the Servicing File and has made such
inquiries as it
deems necessary to make and confirm the accuracy of the
representations set
forth herein;
(n) Full Disbursement of Proceeds. The Mortgage Loan has been
closed
and the proceeds of the Mortgage Loan have been fully disbursed and
there is no
requirement for future advances thereunder, and any and all
requirements as to
completion of any on-site or off-site improvement and as to
disbursements of any
escrow funds therefor have been complied with. All costs, fees and
expenses
incurred in making or closing the Mortgage Loan and the recording
of the
Mortgage were paid, and the Mortgagor is not entitled to any refund
of any
amounts paid or due under the Mortgage Note or Mortgage;
(o) Ownership. The Seller is the sole owner of record and holder
of
the Mortgage Loan and the indebtedness evidenced by each Mortgage
Note and upon
the sale of the Mortgage Loans to the Purchaser, the Seller will
retain the
Mortgage Files or any part thereof with respect thereto not
delivered to the
Custodian, the Purchaser or the Purchaser's designee, in trust only
for the
purpose of servicing and supervising the servicing of each Mortgage
Loan. The
Mortgage Loan is not assigned or pledged, and the Seller has good,
indefeasible
and marketable title thereto, and has full right to transfer and
sell the
Mortgage Loan to the Purchaser free and clear of any encumbrance,
equity,
participation interest, lien, pledge, charge, claim or security
interest, and
has full right and authority subject to no interest or
participation of, or
agreement with, any other party, to sell and assign each Mortgage
Loan pursuant
to this Agreement and [following the sale of each Mortgage Loan,
the Purchaser
will own such Mortgage Loan free and clear of any encumbrance,
equity,
participation interest, lien, pledge, charge, claim or security
interest.] The
Seller intends to relinquish all rights to possess, control and
monitor the
Mortgage Loan. After the related Closing Date, the Seller will have
no right to
modify or alter the terms of the sale of the Mortgage Loan and the
Seller will
have no obligation or right to repurchase the Mortgage Loan or
substitute
another Mortgage Loan, except as provided in this Agreement;
(p) Doing Business. All parties which have had any interest in
the
Mortgage Loan, whether as mortgagee, assignee, pledgee or
otherwise, are (or,
during the period in which they held and disposed of such interest,
were) (1) in
compliance with any and all applicable licensing requirements of
the laws of the
state wherein the Mortgaged Property is located, and (2) either (i)
organized
under the laws of such state, or (ii) qualified to do business in
such state, if
such qualification is required, or (iii) a federal savings and loan
association,
a savings bank or a national bank having a principal office in such
state, or
(3) not doing business in such state;
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<PAGE>
(q) CLTV, LTV and PMI Policy. No Mortgage Loan that is a Second
Lien
Loan has a CLTV greater than 100%. No Mortgage Loan has an LTV
greater than
100%. Any Mortgage Loan that had at the time of origination an LTV
in excess of
80% is insured as to payment defaults by a PMI Policy, if so
required by the
Underwriting Guidelines. Any PMI Policy in effect covers the
related Mortgage
Loan for the life of such Mortgage Loan. All provisions of such PMI
Policy have
been and are being complied with, such policy is in full force and
effect, and
all premiums due thereunder have been paid. No action, inaction, or
event has
occurred and no state of facts exists that has, or will result in
the exclusion
from, denial of, or defense to coverage. Any Mortgage Loan subject
to a PMI
Policy obligates the Mortgagor thereunder to maintain the PMI
Policy and to pay
all premiums and charges in connection therewith. The Mortgage
Interest Rate for
the Mortgage Loan as set forth on the related Mortgage Loan
Schedule is net of
any such insurance premium if the related PMI Policy is
lender-paid;
(r) Title Insurance. With respect to a Mortgage Loan which is not
a
Co-op Loan, the Mortgage Loan is covered by an ALTA lender's title
insurance
policy, or with respect to any Mortgage Loan for which the related
Mortgaged
Property is located in California a CLTA lender's title insurance
policy, or
other generally acceptable form of policy or insurance acceptable
to Fannie Mae
or Freddie Mac and each such title insurance policy is issued by a
title insurer
acceptable to Fannie Mae or Freddie Mac and qualified to do
business in the
jurisdiction where the Mortgaged Property is located, insuring the
Seller, its
successor
