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EXHIBIT
99.13b
FIFTH
AMENDED AND RESTATED
MORTGAGE
LOAN PURCHASE AND WARRANTIES AGREEMENT
MORGAN
STANLEY MORTGAGE CAPITAL INC.,
Purchaser
US
BANK, N.A.,
Seller
Dated
as of April 1, 2007
Conventional,
Fixed
and Adjustable Rate
Residential
Mortgage Loans
TABLE
OF CONTENTS
Page
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SECTION
1.
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Definitions.
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1
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SECTION
2.
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Agreement
to Purchase.
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15
|
|
SECTION
3.
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Mortgage
Schedules.
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15
|
|
SECTION
4.
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Purchase
Price.
|
15
|
|
SECTION
5.
|
Examination
of Mortgage Files.
|
16
|
|
SECTION
6.
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Conveyance
from Seller to Purchaser.
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16
|
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SECTION
7.
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Servicing
of the Mortgage Loans.
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19
|
|
SECTION
8.
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[Reserved].
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19
|
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SECTION
9.
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Representations,
Warranties and Covenants of the Seller; Remedies for
Breach.
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19
|
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SECTION
10.
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Closing.
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40
|
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SECTION
11.
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Closing
Documents.
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41
|
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SECTION
12.
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Costs.
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43
|
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SECTION
13.
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Cooperation
of Seller with a Reconstitution.
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43
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SECTION
14.
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The
Seller.
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45
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SECTION
15.
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Financial
Statements.
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46
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SECTION
16.
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Mandatory
Delivery; Grant of Security Interest.
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46
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SECTION
17.
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Notices.
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47
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SECTION
18.
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Severability
Clause.
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48
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SECTION
19.
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Counterparts.
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48
|
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SECTION
20.
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Governing
Law.
|
48
|
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SECTION
21.
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Intention
of the Parties.
|
49
|
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SECTION
22.
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Successors
and Assigns; Assignment of Purchase Agreement.
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49
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SECTION
23.
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Waivers.
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49
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SECTION
24.
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Exhibits.
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49
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SECTION
25.
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General
Interpretive Principles.
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50
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SECTION
26.
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Reproduction
of Documents.
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50
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SECTION
27.
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Further
Agreements.
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50
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SECTION
28.
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Recordation
of Assignments of Mortgage.
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51
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SECTION
29.
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No
Solicitation.
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51
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SECTION
30.
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Waiver
of Trial by Jury.
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51
|
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SECTION
31.
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Governing
Law Jurisdiction; Consent to Service of Process.
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52
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SECTION
32.
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Privacy.
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52
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SECTION
33.
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Compliance
with Regulation AB
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53
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EXHIBITS
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EXHIBIT
A
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CONTENTS
OF EACH MORTGAGE FILE
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EXHIBIT
B
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FORM
OF INDEMNIFICATION AND CONTRIBUTION AGREEMENT
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EXHIBIT
C
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FORM
OF SELLER’S OFFICER’S CERTIFICATE
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EXHIBIT
D
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FORM
OF OPINION OF COUNSEL TO THE SELLER
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EXHIBIT
E
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FORM
OF SECURITY RELEASE CERTIFICATION
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EXHIBIT
F
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FORM
OF SECURITY RELEASE CERTIFICATION
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EXHIBIT
G
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UNDERWRITING
GUIDELINES
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EXHIBIT
H
|
FORM
OF ASSIGNMENT AND CONVEYANCE AGREEMENT
|
FIFTH AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND WARRANTIES
AGREEMENT
This
FIFTH AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND
WARRANTIES AGREEMENT (the “ Agreement ”),
dated as of April 1, 2007, by and between Morgan Stanley
Mortgage Capital Inc., a New York corporation (the “
Purchaser ”), and US Bank, N.A., a national
banking association (the “ Seller
”).
W I T N E S S E T H
:
WHEREAS,
the Purchaser and the Seller are parties to that certain
Mortgage Loan Purchase and Warranties Agreement, dated as of
November 1, 2003, as amended and restated
by the parties on or about February 1, 2004, as
further amended and restated by the parties on or about April
1, 2004, as further amended and restated by the parties on or
about January 1, 2005, as further amended and restated by the
parties on or about February 1, 2005, pursuant to which
agreement, as further amended hereby, the Seller may sell,
from time to time, to the Purchaser, and the Purchaser may
purchase, from time to time, from the Seller, certain
adjustable and fixed rate residential first lien and second
lien mortgage loans (the “ Mortgage Loans
”) and which shall be delivered in pools of whole loans
(each, a “ Mortgage Loan Package ”) on
various dates as provided therein (each, a “ Closing
Date ”);
WHEREAS,
the Purchaser and the Seller have entered into separate
agreements which provide for the servicing of the Mortgage
Loans purchased hereunder on a servicing released
basis;
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:
SECTION
1.
Definitions .
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 loans of the
same type as such Mortgage Loan in the jurisdiction where the
related Mortgaged Property is located, which practices (i) shall be
in accordance with the requirements of the Servicer’s
policies and procedures and (ii) shall be, at a minimum, at least
as prudent as the requirements of Fannie Mae as set forth from time
to time in the Fannie Mae Selling and Servicing Guide, as amended
from time to time.
Act : The National Housing Act, as amended from time
to time.
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 Fifth Amended and Restated Mortgage
Loan Purchase and Warranties Agreement and all amendments 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 as the value of the Mortgaged Property.
Assignment and Conveyance Agreement : As defined in
Subsection 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 which by
its original terms or any modifications thereof provides for
amortization beyond its scheduled maturity date.
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 Servicer’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.
Closing Documents : The documents required to be
delivered on each Closing Date pursuant to Section 11
.
CLTV : As of any date and as to any Second Lien
Loan, the ratio, expressed as a percentage, of (a) the 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 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, or
any successor statute thereto.
Commission : The United States Securities and
Exchange Commission.
Condemnation Proceeds : All awards, compensation and
settlements in respect of a taking of all or part of a Mortgaged
Property, whether permanent or temporary, partial or entire, by
exercise of the power of condemnation or the right of eminent
domain, 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.
Covered Loan : Shall have the meaning set forth in
the then most recently issued version of the Standard & Poor's
LEVELS Glossary Ò , Appendix E, as the same may be
amended, restated, supplemented or otherwise modified from time to
time.
Custodial Account : The separate trust account
created and maintained pursuant to Subsection 2.04 of the
Interim Servicing Agreement (with respect to each Mortgage Loan, as
specified therein).
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 : The custodian under a Custodial
Agreement, and its successors in interest, 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.
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 : The date specified in the
Interim Servicing Agreement.
Due Date : The day of the month on which the Monthly
Payment is due on a Mortgage Loan, exclusive of any days of
grace.
Escrow Payments : With respect to any Mortgage Loan,
the amounts constituting ground rents, taxes, assessments, water
rates, sewer rents, municipal charges, mortgage insurance premiums,
fire and hazard insurance premiums, condominium charges, and any
other payments required to be escrowed by the Mortgagor with the
mortgagee pursuant to the Mortgage or any other
document.
Event of Default : As defined in the Interim
Servicing Agreement.
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, as amended or
restated from time to time.
Fannie Mae Transfer : As defined in Section
13 .
FHA : The Federal Housing Administration, an agency
within the United States Department of Housing and Urban
Development, or any successor thereto and including the Federal
Housing Commissioner and the Secretary of Housing and Urban
Development where appropriate under the FHA
Regulations.
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.
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 Section
13 .
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” (as each such term is calculated under HOEPA)
payable by the related Mortgagor that exceed the thresholds
set forth by HOEPA and its implementing regulations, including
12 C.F.R. § 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) a Mortgage Loan
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.
HUD : The Department of Housing and Urban
Development, or any federal agency or official thereof which may
from time to time succeed to the functions thereof with regard to
Mortgage Insurance issued by the FHA. The term
“HUD,” for purposes of this Agreement, is also deemed
to include subdivisions thereof such as the FHA and Government
National Mortgage Association.
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 any FHA or VA insurance, title policy, hazard
policy or other 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.
Interim Servicer : The servicer under the Interim
Servicing Agreement, or its successor in interest, or any successor
to the Interim Servicer under the Interim Servicing Agreement, as
therein provided.
Interim Servicing Agreement : That certain Third
Amended and Restated Interim Servicing Agreement, dated as of April
1, 2007, between the Purchaser and US Bank, N.A., as interim
servicer, with respect to the servicing of Mortgage Loans purchased
on a servicing released basis.
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.
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
term 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 amount per annum set forth on the related Mortgage Loan
Schedule.
Liquidation Proceeds : The proceeds 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, other than amounts
received following the acquisition of REO Property, Insurance
Proceeds and Condemnation Proceeds.
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 Appraised Value of the Mortgaged Property at
origination and (b) if the Mortgage Loan was made to finance
the acquisition of the related Mortgaged Property, the purchase
price of the Mortgaged Property.
Manufactured Home : A single family residential unit
that is constructed in a factory in sections in accordance with the
Federal Manufactured Home Construction and Safety Standards adopted
on July 15, 1976, by the Department of Housing and Urban
Development (“ HUD Code ”), as amended in 2000,
which preempts state and local building codes. Each unit
is identified by the presence of a HUD Plate/Compliance Certificate
label. The sections are then transported to the site and
joined together and affixed to a pre-built permanent foundation
(which satisfies the manufacturer’s requirements and all
state, county, and local building codes and
regulations). The manufactured home is built on a
non-removable, permanent frame chassis that supports the complete
unit of walls, floors, and roof. The underneath part of
the home may have running gear (wheels, axles, and brakes) that
enable it to be transported to the permanent site. The
wheels and hitch are removed prior to anchoring the unit to the
permanent foundation. The manufactured home must be
classified as real estate and taxed accordingly. The
permanent foundation may be on land owned by the mortgager or may
be on leased land.
MERS : Mortgage Electronic Registration Systems,
Inc., a Delaware corporation, and its successors in
interest.
MERS Designated Mortgage Loan : Mortgage Loans 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 payable by a Mortgagor under the related
Mortgage Note on each Due Date.
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 the related on the Mortgaged
Property. 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 Subsection 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
Mortgaged Property is owner-occupied, investment property or a
second home; (5) 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); (6) 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; (7) the
LTV or CLTV, as applicable, at origination; (8) the Mortgage
Interest Rate as of the related Cut-
off
Date; (9) 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;
(10) the stated maturity date; (11) the amount of
the Monthly Payment as of the related Cut-off Date;
(12) the last payment date on which a payment was
actually applied to the actual unpaid principal balance;
(13) the original principal amount of the Mortgage Loan;
(14) the actual unpaid 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; (15) with respect to
Adjustable Rate Mortgage Loans, the Interest Rate Adjustment
Date; (16) with respect to Adjustable Rate Mortgage
Loans, the Gross Margin; (17) with respect to Adjustable
Rate Mortgage Loans, the Lifetime Rate Cap under the terms of
the Mortgage Note; (18) with respect to Adjustable Rate
Mortgage Loans, a code indicating the type of Index;
(19) the product type of Mortgage Loan (i.e., Fixed Rate,
Adjustable Rate, First Lien Loan or Second Lien Loan), and
with respect to each Second Lien Loan, the product type of the
related first lien loan; (20) a code indicating the
purpose of the loan (i.e., purchase, rate/term refinance or
cash-out refinance); (21) a code indicating the
documentation style (i.e. no documents, full, alternative,
reduced, no income/no asset, stated income, no ration, reduced
or NIV); (22) the loan credit classification (as
described in the Underwriting Guidelines); (23) whether
such Mortgage Loan provides for a Prepayment Penalty;
(24) the Prepayment Penalty period of such Mortgage Loan,
if applicable; (25) a description of the Prepayment
Penalty, if applicable, including whether the applicable
Prepayment Penalty provision is “hard” or
“soft”; (26) the Mortgage Interest Rate as of
origination; (27) the credit risk score (FICO score);
(28) the date of origination; (29) with respect to
Adjustable Rate Mortgage Loans, the Mortgage Interest Rate
adjustment period; (30) with respect to Adjustable Rate
Mortgage Loans, the Mortgage Interest Rate adjustment
percentage; (31) with respect to Adjustable Rate Mortgage
Loans, the Mortgage Interest Rate floor; (32) the
Mortgage Interest Rate calculation method (i.e., 30/360,
simple interest, other); (33) with respect to Adjustable
Rate Mortgage Loans, the Periodic Rate Cap as of the first
Interest Rate Adjustment Date; (34) a code indicating
whether the Mortgage Loan is a Balloon Mortgage Loan;
(35) the original Monthly Payment due; (36) the
Appraised Value; (37) a code indicating whether the
Mortgage Loan is covered by a PMI Policy and, if so,
identifying the PMI Policy provider; (38) in connection
with a condominium unit, a code indicating whether the
condominium project where such unit is located is low-rise or
high-rise; (39) a code indicating whether the Mortgaged
Property is a leasehold estate; (40) a code indicating
whether the Mortgage Loan is a MERS Designated Mortgage Loan
and the MERS Identification Number, if applicable, (41) the
social security number of the Mortgagor; (42) a code
indicating whether the Mortgagor’s race and/or ethnicity
is (i) native American or Alaskan native, (ii) Asian/Pacific
islander, (iii) African American, (iv) white, (v) Hispanic or
Latino, (vi) other minority, (vii) not provided by the
Mortgagor, (viii) not applicable (if the Mortgagor is an
entity) and (ix) unknown or missing; (43) a code indicating
whether the Mortgagor is self-employed; (44) whether the
Mortgage Loan has Monthly Payments that are interest-only for
a period of time, and the interest-only period, if applicable
(and with respect to each Second Lien Loan, whether the
related first lien mortgage loan has monthly payments that are
interest-only for a period of time, and the interest-only
period, if applicable); (45) the schedule of the payment
delinquencies in the prior 12 months; (46) the Servicing Fee
Rate; (47) with respect to each Mortgage Loan with a second
lien behind it, the combined principal balance of the Mortgage
Loan and the applicable second lien loan, at origination, (48)
a code indicating whether there is a simultaneous second; (49)
asset verification (Y/N); (50) with respect to each Adjustable
Rate
Mortgage
Loan, a code indicating whether the Mortgage Loan provides for
negative amortization; (51) a code indicating whether the
Mortgage Loan has negative amortization and the maximum of
such negative amortization; (52) appraisal type; (53)
appraisal date; (54) the certificate number of the PMI Policy,
if applicable; (55) the amount of coverage of the PMI Policy,
if applicable; (56) with respect to the related Mortgagor, the
debt-to-income ratio; (57) sales price; (58) automated
valuation model (AVM); (59) a field indicating whether such
Mortgage Loan is a Home Loan; and (60) the DU or LP number, if
applicable. 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 actual unpaid 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
actual unpaid 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
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, which is acceptable
for purchase by Fannie Mae or Freddie Mac under applicable Fannie
Mae or Freddie Mac guidelines. With respect to a Co-op
Loan, 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.
Mortgagor : The obligor on the related Mortgage
Note.
Nonrecoverable Advance : Any advance previously made
or proposed to be made in respect of a Mortgage Loan which, in the
good faith judgment of the Servicer, will not or, in the case of a
proposed advance, would not, be ultimately recoverable from related
Insurance Proceeds, Liquidation Proceeds or
otherwise. The determination by the Servicer that it has
made a Nonrecoverable Advance or that any proposed advance of
principal and interest, if made, would constitute a Nonrecoverable
Advance, shall be evidenced by an Officers’ Certificate
delivered to the Purchaser.
Officer’s Certificate : A certificate signed
by the Chairman of the Board or the Vice Chairman of the Board 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
Interim Servicer, 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 (as defined in
the Interim Servicing Agreement), (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
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.
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.
Preliminary Mortgage Schedule : As defined in
Section 3 .
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
Section 4 of this Agreement.
Purchase Price and Terms Agreement : Each agreement
setting forth the general terms and conditions of the purchase and
sale of the Mortgage Loans to be purchased from time to time under
this Agreement.
Purchase Price Percentage : As defined in the
related Purchase Price and Terms Agreement.
Purchaser : Morgan Stanley Mortgage Capital Inc., a
New York corporation, 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 Fannie Mae or
Freddie Mac and Title XI of the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989, as amended and in effect
from time to time, 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 an
actual unpaid 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 actual unpaid principal balance), not in excess
of the actual unpaid principal balance of the Deleted Mortgage Loan
(the amount of any shortfall will be deposited in the Custodial
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); (v) comply with each representation and warranty
(respecting individual Mortgage Loans) set forth in Section
9 ; (vi) be current in the payment of principal and
interest; (vii) be secured by a Mortgaged Property of the same
type and occupancy status as secured the Deleted Mortgage Loan; and
(viii) have payment terms that do not vary in any material
respect from those of the Deleted Mortgage Loan.
Rating Agency : Any of Fitch, Moody’s or
Standard & Poor’s, or their respective successors
designated by the Purchaser.
Reconstitution : Any Securitization Transaction or a
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 Section 13 ,
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 Section
13 .
Regulation AB : Subpart 229.1100 – Asset
Backed Securities (Regulation AB), 17 C.F.R.
§§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. 1,506–1,631 (January 7, 2005)) or by the staff of
the Commission, or as may be provided by the Commission or its
staff from time to time.
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 date specified in the Interim
Servicing Agreement (with respect to each Mortgage Loan, as
specified therein).
Repurchase Price : With respect to any Mortgage
Loan, a price in an amount equal to: (a) during the first year
immediately following the related Closing Date and prior to any
Securitization Transaction, the sum of (1) the product of (A)
the related Purchase Price Percentage and (B) the then outstanding
actual unpaid principal balance of such Mortgage Loan as of the
date through which such repurchase takes place, plus (2)
accrued interest on such Mortgage Loan at the applicable mortgage
interest rate from the last “interest paid to” date
through the last day of the month in which such repurchase takes
place, plus (3) the amount of any outstanding
advances owed to any servicer, plus (4) all costs and
expenses incurred by the Purchaser or any servicer arising out of
or based upon such breach, including without limitation, costs and
expenses incurred in the enforcement of the Seller’s
repurchase obligation hereunder, less (5) amounts received
or advanced in respect of such Mortgage Loan which are being held
in the Custodial Account for distribution in the month of
repurchase, and (b) thereafter, the sum of (1) the then
outstanding actual unpaid principal balance of such Mortgage Loan
as of the date through which such repurchase takes place,
plus (2) accrued interest on such Mortgage Loan at the
applicable mortgage interest rate from the last “interest
paid to” date through the last day of the month in which such
repurchase takes place, plus (3) the amount of any
outstanding advances owed to any servicer, plus
(4) all costs and expenses incurred by the Purchaser or any
servicer arising out of or based upon such breach, including
without limitation, costs and expenses incurred in the enforcement
of the Seller’s repurchase obligation hereunder,
less (5) amounts received or advanced in respect of such
Mortgage Loan which are being held in the Custodial Account for
distribution in the month of repurchase. In the
event the Purchaser has securitized or sold a Mortgage
Loan, the Repurchase Price for such Mortgage Loan shall be as set
forth in clause (b) above in all cases, without regard to
when the repurchase obligation, if any, arises.
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 co-operative, mobile or
Manufactured Home.
RESPA : The 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 Subsection
33.04(a) .
Servicer : US Bank, N.A., in its capacity as interim
servicer under the Interim Servicing Agreement, as applicable, or
its successors and assigns.
Servicing Fee : As to each Mortgage Loan Package,
the amount of the fee the Purchaser shall pay to the Servicer for
servicing the Mortgage Loans in accordance with the terms of the
Interim Servicing Agreement, which shall, with respect to each
Mortgage Loan, be equal to $7.00 per calendar month.
Servicing File : With respect to each Mortgage Loan,
the file retained by the 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 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
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.
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
Subsections 9.03 and 14.01 .
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.
Subcontractor : Any vendor, subcontractor or other
Person that is not responsible for the overall servicing (as
“servicing” is commonly understood by participants in
the mortgage-backed securities market) of Mortgage Loans but
performs one or more discrete functions identified in
Item 1122(d) of Regulation AB with respect to Mortgage Loans
under the direction or authority of the Company or a
Subservicer.
Subservicer : Any Person that services Mortgage
Loans on behalf of the Company or any Subservicer and is
responsible for the performance (whether directly or through
Subservicers or Subcontractors) of a substantial portion of the
material servicing functions required to be performed by the
Company under this Agreement or any Reconstitution Agreement that
are identified in Item 1122(d) of Regulation AB.
Third-Party Originator : Each Person, other than a
Qualified Correspondent, that originated Mortgage Loans acquired by
the Seller.
Underwriting Guidelines : The underwriting
guidelines of the Seller, a copy of which is attached as an exhibit
to the related Assignment and Conveyance.
VA : The United States Department of Veterans
Administration, or any successor thereto.
VA Mortgage Loan : A Mortgage Loan partially
guaranteed by the VA pursuant to the Servicemen’s
Readjustment Act of 1944, as amended, or Chapter 37 of Title 38 of
the United States Code.
VA Vendee Loan : A purchase money mortgage loan made
by VA in connection with the sale of a property that it has
acquired (a) from a private lender pursuant to its obligations
under the VA Loan Guaranty Program for Veterans upon termination of
a residential mortgage loan made to a veteran borrower under one of
VA’s loan guaranty programs and (b) as result of
its enforcement of the security instrument covering a property
securing a VA Vendee Loan after default by the borrower
thereunder.
Whole Loan Transfer : Any sale or transfer of some
or all of the Mortgage Loans, other than a Securitization
Transaction.
SECTION
2.
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 actual unpaid 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 aggregate
actual unpaid principal balance of the Mortgage Loans accepted
by the Purchaser on each Closing Date.
SECTION
3.
Mortgage Schedules .
The
Seller from time to time shall provide the Purchaser 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 ”).
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.
SECTION
4.
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 actual unpaid 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 actual
unpaid 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.
In
addition to the Purchase Price as described above, the
Purchaser shall pay to the Seller, at closing, accrued
interest from the last “interest paid to” date
through the day
immediately
preceding the related Closing Date, inclusive, on the
aggregate actual unpaid 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, net of
any applicable Servicing Fees. 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
actual unpaid 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 actual unpaid 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 Custodial
Account, which account is established for the benefit of the
Purchaser for subsequent remittance by the Seller to the
Purchaser.
SECTION
5.
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.
SECTION
6.
Conveyance from Seller to Purchaser .
Subsection
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 Servicer
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
cause the Servicer to release from its custody the contents of
any Servicing File retained by it only in accordance with this
Agreement or the Interim Servicing Agreement, except when such
release is required in connection with a repurchase of any
such Mortgage Loan pursuant to Subsection 9.03
.
Subsection
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; provided , however ,
that if a Mortgage has been recorded in the name of MERS or
its designee, the Seller is shown as the owner of the related
Mortgage Loan on the records of MERS for purposes of the
system of recording transfers of beneficial ownership of
mortgages maintained by MERS. 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 or the Servicer 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 or the Servicer 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 or shall cause the Servicer to 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 or shall
cause the Servicer to 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 or the Servicer may be in the form of microfilm or
microfiche so long as the Seller or the Servicer 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.
Subsection
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 or shall cause the Servicer to 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 ninety 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 90 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
Subsection 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 Mortgage and shall be reimbursed by the
Seller for the costs associated therewith pursuant to the
preceding sentence. Notwithstanding the foregoing,
the Seller agrees that all Mortgage Loans will be MERS
Designated Mortgage Loans as of the related Closing
Date.
Subsection
6.04
Quality Control Procedures .
The
Seller shall, or shall cause the Servicer to, 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 loan production
and the servicing activities of the Servicer. The
program is to ensure that the Mortgage Loans are originated in
accordance with the Underwriting Guidelines; guard against
dishonest, fraudulent, or negligent acts; and guard against
errors and omissions by officers, employees, or other
authorized persons.
Subsection
6.05
MERS Designated Loans .
With
respect to each MERS Designated Mortgage Loan, the Seller
shall, no later than two (2) Business Days following 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.
SECTION
7.
Servicing of the Mortgage Loans .
The
Purchaser shall retain the Servicer as contract servicer of
the Mortgage Loans in accordance with the terms and conditions
contained in the Interim Servicing Agreement.
SECTION
8.
[Reserved] .
SECTION
9.
Representations, Warranties and Covenants of the Seller;
Remedies for Breach .
Subsection
9.01
Representations and Warranties Regarding the Seller and
Purchaser . 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 national banking association validly existing, and in
good standing under the laws of its jurisdiction of
incorporation or formation 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 or by-laws or any
legal restriction or any agreement or instrument to which the
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,
or impair the ability of the Purchaser to realize the full
amount of any insurance benefits accruing pursuant to this
Agreement;
(e)
No Litigation Pending . There is no action,
suit, proceeding or investigation pending or 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,
executive orders and regulations, 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;
(i)
Financial Statements . The Seller has
delivered to the Purchaser annual 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 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. In addition, the Seller has
delivered information as to its loan gain and loss experience
in respect of foreclosures and its loan delinquency experience
for the immediately preceding three-year period, in each case
with respect to mortgage loans owned by it and such mortgage
loans serviced for others during such period, and all such
information so delivered shall be true and correct in all
material respects. 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. The Seller has completed any forms
requested by the Purchaser in a timely manner and in
accordance with the provided instructions;
(j)
Selection Process . The Mortgage Loans were
selected from among the outstanding one- to four-family
mortgage loans in the Seller’s portfolio at the related
Closing Date as to which the representations and warranties
set forth in Subsection 9.01 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
Section 11 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 or will contain any untrue statement of
fact or omits or will omit 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 expects to be
advised by its independent certified public accountants that
under generally accepted accounting principles the transfer of
the Mortgage Loans will be treated 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;
(p)
Approved Seller . The Seller is an approved
seller of residential mortgage loans for Fannie Mae or Freddie
Mac and HUD. The Seller is duly qualified,
licensed, registered and otherwise authorized under all
applicable federal, state and local laws and regulations,
meets the minimum capital requirements, if applicable, set
forth by the Office of the Comptroller of the Currency, and is
in good standing to sell mortgage loans to Fannie Mae or
Freddie Mac and no event has occurred which would make the
Seller unable to comply with eligibility requirements or which
would require notification to either Fannie Mae or Freddie
Mac;
(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)
Insured Depository Institution Representations
. The Seller is an “insured depository
institution” as that term is defined in Section
1813(c)(2) of Title 12 of the United States Code, as amended,
and accordingly, the Seller makes the following additional
representations and warranties:
(A) This
Agreement between the Purchaser and the Seller conforms to
all applicable statutory and regulatory requirements;
and
(B) This
Agreement is (1) executed contemporaneously with the
agreement reached by the Purchaser and the Seller,
(2) approved by a specific or general corporate or
banking association resolution by the Seller’s board of
directors, which approval shall be reflected in the minutes
of said board, and (3) an official record of the Seller.
A copy of such resolution, certified by a vice president or
higher officer of the Seller has been provided to the
Purchaser;
(ii) The
Purchaser represents, warrants and covenants to the Seller
that as of the date hereof and as of each Closing
Date:
(1)
Due Organization . The Purchaser is an
entity duly organized, validly existing and in good standing
under the laws of its jurisdiction of organization, and has
all licenses necessary to carry on its business now being
conducted and is licensed, qualified and in good standing
under the laws of each state where a Mortgaged Property is
located or is otherwise exempt under applicable law from such
qualification or is otherwise not required under applicable
law to effect such qualification; no demand for such
qualification has been made upon the Purchaser by any state
having jurisdiction and in any event the Purchaser is or will
be in compliance with the laws of any such state to the extent
necessary to enforce each Mortgage Loan.
(2)
Due Authority . The Purchaser had the full
power and authority and legal right to acquire the Mortgage
Loans to be purchased hereunder. The Purchaser has
the full power and authority to hold each Mortgage Loan, to
sell each Mortgage Loan and to execute, deliver and perform,
and to enter into and consummate, all transactions
contemplated by this Agreement. The Purchaser has
duly authorized the execution, delivery and performance of
this Agreement, has duly executed and delivered this
Agreement, and this Agreement, assuming due authorization,
execution and delivery by the Seller, constitutes a legal,
valid and binding obligation of the Purchaser, enforceable
against it in accordance with its terms, subject to applicable
bankruptcy, reorganization, receivership, conservatorship,
insolvency, moratorium and other laws relating to or affecting
creditors’ rights generally or the rights of creditors
of banks and to the general principles of equity (whether such
enforceability is considered in a proceeding in equity or at
law);
(3)
No Conflict . None of the execution and
delivery of this Agreement, the acquisition of the Mortgage
Loans by the Purchaser, the purchase of the Mortgage Loans,
the consummation of the transactions contemplated hereby, or
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
Purchaser’s organizational documents and bylaws or any
legal restriction or any agreement or instrument to which the
Purchaser 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 Purchaser
or its property is subject;
(4)
No Material Default . The Purchaser is not
in material default under any agreement, contract, instrument
or indenture of any nature whatsoever to which the Purchaser
is a party or by which it (or any of its assets) is bound,
which default would have a material adverse effect on the
ability of the Purchaser to perform under this Agreement, nor,
to the best of the Purchaser’s knowledge, has any event
occurred which, with notice, lapse of time or both would
constitute a material default under any such agreement,
contract, instrument or indenture and have a material adverse
effect on the ability of the Purchaser to perform its
obligations under this Agreement; and
(5)
No Consent Required . No consent, approval,
authorization or order of any court or governmental agency or
body is required for the execution, delivery and performance
by
the
Purchaser of or compliance by the Purchaser with this
Agreement, the purchase of the Mortgage Loans from the Seller
or the consummation of the transactions contemplated by this
Agreement or, if required, such approval has been obtained
prior to the Funding Date.
Subsection
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 have been made and
credited. No payment required under the Mortgage
Loan is 30 days or more delinquent nor has any payment under
the Mortgage Loan been 30 days or more delinquent at any time
since the origination of the Mortgage Loan;
(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 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, 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;
(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 Underwriting
Guidelines. If required by the National Flood
Insurance Act of 1968, as amended, or if upon origination of
the Mortgage Loan, the improvements on the Mortgaged Property
were in an area identified in the Federal Register by the
Federal Emergency Management Agency as having special flood
hazards, the Mortgage Loan is covered by a flood insurance
policy meeting the requirements of the current guidelines of
the Federal Insurance Administration which policy conforms to
Fannie Mae and Freddie Mac requirements. The amount
of such insurance shall be no less than the least of (A) the
actual unpaid principal balance of the Mortgage Loan, (B) the
full insurable value and (C) the maximum amount of insurance
which was available under the Flood Disaster Protection Act of
1983, as amended. Such policy was issued by an
insurer acceptable under Fannie Mae or Freddie Mac
guidelines. 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 the
valid and binding obligation of the insurer, is in full force
and effect, and will be in full force and effect and inure to
the benefit of the Purchaser 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, 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, predatory,
abusive and fair lending, equal credit opportunity and
disclosure laws applicable to the Mortgage Loan 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 and is not secured by
an interest in a leasehold estate, the Mortgaged Property is a
fee simple estate that consists of a single or contiguous
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, with respect to each Co-Op Loan, 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 and applicable HUD or VA
requirements. 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. This
representation and warranty is a Deemed Material and Adverse
Representation;
(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 additions, alterations and
replacements made at any time with respect to the
foregoing. The lien of the Mortgage is subject only
to:
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(i)
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with
respect to a Second Lien Loan only, the lien of the first mortgage
on the Mortgaged Property;
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(ii)
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the
lien of current real property taxes and assessments not yet due and
payable;
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(iii)
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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 of the Mortgaged Property set forth in
such appraisal; and
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(iv)
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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.
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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.
With
respect to any Co-op Loan, the related Mortgage is a valid,
subsisting and enforceable first priority security interest 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;
(k)
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. 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;
(l)
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;
(m)
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, except as may be required of the
Seller in its capacity as Interim Servicer of such 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, except as provided in
this Agreement;
(n)
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, 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;
(o)
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, which will remain in effect until
such time as it is cancelled in accordance with its terms or
under applicable law. 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;
(p)
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 other
generally acceptable form of policy or insurance acceptable
under the Underwriting Guidelines or to Fannie Mae
or Freddie Mac, as applicable, and each such title insurance
policy is issued by a title insurer acceptable under the
Underwriting Guidelines, or under Fannie Mae or Freddie Mac
guidelines, as applicable, and qualified to do business in the
jurisdiction where the Mortgaged Property is located, insuring
the Seller, its successors and assigns, as to the first
(with
respect
to a First Lien Loan) or second (with respect to a Second Lien
Loan) priority lien of the Mortgage in the original principal
amount of the Mortgage Loan (or to the extent a Mortgage Note
provides for negative amortization, the maximum amount of
negative amortization in accordance with the Mortgage),
subject only to the exceptions contained in clauses (i),
(ii), (iii) and (iv) of paragraph (j) of this
Subsection 9.02 , and in the case of Adjustable
Rate Mortgage Loans, against any loss by reason of the
invalidity or unenforceability of the lien resulting from the
provisions of the Mortgage providing for adjustment to the
Mortgage Interest Rate and Monthly Payment. Where
required by state law or regulation, the Mortgagor has been
given the opportunity to choose the carrier of the required
mortgage ti
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