<PAGE>
Exhibit 99.2
EXECUTION COPY
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BARCLAYS BANK PLC,
Purchaser
AMERICAN HOME MORTGAGE CORP.,
Seller
MORTGAGE LOAN PURCHASE AGREEMENT
Dated as of November 1, 2006
Conventional, Fixed and Adjustable Rate
Residential Mortgage Loans
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TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
Section 1.01
Defined Terms..............................................1
ARTICLE II
AGREEMENT
TO PURCHASE
Section 2.01
Agreement to Purchase.....................................14
ARTICLE III
MORTGAGE SCHEDULES
Section 3.01
Preliminary Mortgage Schedule.............................15
Section 3.02
Delivery of Mortgage Loan Schedule........................15
ARTICLE IV
PURCHASE PRICE
Section 4.01
Purchase Price............................................15
ARTICLE V
EXAMINATION OF MORTGAGE FILES
Section 5.01
Examination of Mortgage Files.............................16
ARTICLE
VI
CONVEYANCE FROM SELLER TO PURCHASER
Section 6.01
Conveyance of Mortgage Loans..............................16
Section 6.02
Books and Records.........................................17
Section 6.03 Delivery of Mortgage
Loan Documents.......................17
Section 6.04
Quality Control Procedures................................18
Section 6.05
MERS Designated Loans.....................................19
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ARTICLE VII
SERVICING OF THE MORTGAGE LOANS
Section 7.01
Servicing.................................................19
ARTICLE VIII
[RESERVED]
ARTICLE IX
REPRESENTATIONS, WARRANTIES AND COVENANTS
OF THE SELLER; REMEDIES FOR BREACH
Section 9.01
Representations and Warranties Regarding the Seller.......19
Section 9.02
Representations and Warranties Regarding Individual
Mortgage Loans........................................24
Section 9.03
Remedies for Breach of Representations and Warranties.....38
Section 9.04
Repurchase of Mortgage Loans with First Payment Defaults..40
Section 9.05
Premium Recapture.........................................41
ARTICLE X
CLOSING
Section 10.01
Conditions to Closing.....................................41
ARTICLE XI
CLOSING DOCUMENTS
Section 11.01
Required Closing Documents................................42
ARTICLE XII
COSTS
Section 12.01
Costs.....................................................43
ARTICLE XIII
COOPERATION OF SELLER WITH A RECONSTITUTION
Section 13.01
Reconstitution of Mortgage Loans..........................44
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ARTICLE XIV
THE SELLER
Section 14.01
Additional Indemnification by the Seller; Third Party
Claims................................................45
Section 14.02
Merger or Consolidation of the Seller.....................46
ARTICLE XV
MISCELLANEOUS PROVISIONS
Section 15.01
Financial Statements......................................47
Section 15.02
Mandatory Delivery; Grant of Security Interest............47
Section 15.03
Notices...................................................48
Section 15.04
Severability Clause.......................................49
Section 15.05
Counterparts..............................................49
Section 15.06
Governing Law.............................................49
Section 15.07
Intention of the Parties..................................49
Section 15.08
Successors and Assigns; Assignment of Purchase Agreement..49
Section 15.09
Waivers...................................................50
Section 15.10
Exhibits..................................................50
Section 15.11
General Interpretive Principles...........................50
Section 15.12
Reproduction of Documents.................................51
Section 15.13
Further Agreements........................................51
Section 15.14
Recordation of Assignments of Mortgage....................51
Section 15.15 No
Solicitation...........................................51
Section 15.16
Waiver of Trial by Jury...................................52
Section 15.17
Governing Law Jurisdiction; Consent to Service of Process.52
ARTICLE
XVI
COMPLIANCE WITH REGULATION AB
Section 16.01
Intent of the Parties; Reasonableness.....................52
Section 16.02
Additional Representations and Warranties of the Seller...53
Section 16.03
Information to Be Provided by the Seller..................54
Section 16.04
Indemnification; Remedies.................................56
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<PAGE>
EXHIBITS
EXHIBIT A
CONTENTS
OF EACH MORTGAGE FILE
EXHIBIT B
INDEMNIFICATION AND CONTRIBUTION AGREEMENT
EXHIBIT C
FORM OF SELLER'S OR SERVICER'S OFFICER'S CERTIFICATE
EXHIBIT D
FORM OF OPINION OF COUNSEL TO THE SELLER OR SERVICER
EXHIBIT E
FORM OF SECURITY
RELEASE CERTIFICATION
EXHIBIT F
FORM OF SECURITY RELEASE CERTIFICATION
EXHIBIT G
UNDERWRITING GUIDELINES
EXHIBIT H
FORM OF ASSIGNMENT AND CONVEYANCE AGREEMENT
EXHIBIT I
FORM OF ASSIGNMENT AND RECOGNITION AGREEMENT
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MORTGAGE LOAN PURCHASE AGREEMENT
--------------------------------
This
MORTGAGE LOAN PURCHASE AGREEMENT (the "Agreement"), dated as of
November 1, 2006, by and between Barclays Bank PLC, a public
limited liability
company, registered in England and Wales under company number
1026167, having an
office at 200 Park
Avenue, New York , New
York 10166 (the
"Purchaser"),
and
American Home Mortgage
Corp., a New York
corporation, having an
office at 538
Broadhollow Road, Melville, New York 11747 (the "Seller").
W I T N E S S E T H:
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WHEREAS, the Seller
desires to sell, from
time to time, to the Purchaser,
and the Purchaser
desires to
purchase, from time to time, from the Seller,
certain conventional fixed and adjustable rate residential
first-lien and second
lien residential
mortgage loans (the "Mortgage Loans") on a servicing retained
basis as described herein, and which shall be delivered in
pools of whole loans
(each, a "Mortgage
Loan Package") on various dates as provided herein (each, a
"Closing Date");
WHEREAS, each
Mortgage Loan is secured by a mortgage, deed of trust or
other security
instrument creating a first lien or second lien on a
residential
dwelling located in the jurisdiction indicated on the Mortgage Loan
Schedule for
the related Mortgage Loan Package;
WHEREAS, the
Purchaser and the
Seller wish to prescribe the manner of the
conveyance, servicing and control of the Mortgage Loans; and
WHEREAS, following its
purchase of the Mortgage Loans from the Seller, the
Purchaser desires
to sell some or all of the Mortgage Loans to one or more
purchasers as a whole
loan transfer or a
public or private,
rated or unrated
Securitization Transaction;
NOW,
THEREFORE, in
consideration of the premises and mutual agreements set
forth herein,
and for other good and
valuable
consideration, the
receipt and
sufficiency of which are hereby acknowledged, the Purchaser and the
Seller agree
as follows:
ARTICLE I
DEFINITIONS
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Section 1.01
Defined Terms.
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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
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service mortgage
loans of the same type as such Mortgage Loan in the
jurisdiction where the related Mortgaged Property is located.
Adjustable Rate
Mortgage Loan: An adjustable rate Mortgage Loan purchased
pursuant to this Agreement.
Affiliate: With
respect to any specified Person, any other Person
controlling or controlled by or under common control with such
specified Person.
For the purposes of
this definition,
"control" when used with respect to any
specified Person means
the power to direct the management and policies of
such
Person, directly
or indirectly, whether through the ownership of voting
securities, by
contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agency Transfer: A Fannie Mae Transfer or a Freddie Mac
Transfer.
Agreement: This Mortgage Loan Purchase
Agreement and all amendments hereof
and supplements hereto.
ALTA: The American Land Title Association or any successor
thereto.
Ancillary Income:
All late charges, assumption fees, escrow account
benefits,
reinstatement fees,
and similar
types of fees
arising from or in
connection with any
Mortgage, to the extent not otherwise payable to the
Mortgagor under
applicable law or pursuant to the terms of the related Mortgage
Note.
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 Section
6.01.
Assignment of Mortgage: An assignment of the Mortgage,
notice of transfer
or equivalent
instrument in recordable form, sufficient under the laws of
the
jurisdiction wherein
the related Mortgaged
Property is located to
reflect the
sale of the Mortgage to the Purchaser.
Balloon Mortgage Loan: Any Mortgage Loan (a) that requires only
payments of
interest until the
stated maturity
date of the Mortgage
Loan or (b) for which
Monthly Payments
of principal (not including the payment due on its stated
maturity date) are based on an amortization schedule that would be
insufficient
to fully amortize
the principal thereof by the stated maturity date of the
Mortgage Loan.
Business Day:
Any day other than (i)
a Saturday or Sunday,
(ii) a day on
which banking and savings and loan institutions, in the State of
New York or the
State in which the Seller's servicing operations are located or (iii)
the state
in which the Custodian's operations are located, are
authorized or obligated by
law or executive order to be closed.
Closing Date: The date
or dates on which the
Purchaser from time to
time
shall purchase, and
the Seller from time to time shall sell, the Mortgage Loans
listed on the related
Mortgage Loan Schedule with respect to the related
Mortgage Loan Package.
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CLTV: As of any date and as to any Second Lien Loan, the ratio, expressed
as a percentage, of
the (a) sum of (i) the outstanding principal balance of the
Second Lien Loan and (ii) the outstanding principal balance as of such date of
any mortgage loan or mortgage loans that are senior or equal in
priority to the
Second Lien Loan and which are secured by the same Mortgaged
Property to (b) the
Appraised Value as
determined pursuant to
the Underwriting
Guidelines of the
related Mortgaged Property as of the origination of the Second Lien
Loan.
Code: Internal Revenue Code of 1986, as amended.
Commission: The United States Securities and Exchange
Commission.
Condemnation Proceeds:
All awards or settlements in respect of a Mortgaged
Property, whether permanent or temporary, partial or entire, by exercise of
the
power of eminent
domain or condemnation, to the extent not required to be
released to a Mortgagor in accordance with the terms of the related
Mortgage
Loan Documents.
Co-op: A private, cooperative housing corporation, having only one
class of
stock outstanding,
which owns r 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: A Mortgage Loan categorized as Covered pursuant to
Appendix E
of Standard & Poor's Glossary.
Custodial Account:
The separate trust account created and maintained
pursuant to
Section 2.04 of the 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: Wells Fargo Bank, N.A., a national banking association,
and its
successors in interest
or permitted assigns
or any successor to
the Custodian
under the Custodial Agreement as therein provided.
Cut-off Date: The date or dates designated as such on the related
Mortgage
Loan Schedule with respect to the related Mortgage Loan
Package.
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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 earlier of two (2) Business Days prior to the
related Remittance
Date, or the 15th day of the
month in which
the related
Remittance Date occurs
or, if such date is not a Business Day, the immediately
following Business Day.
Due
Date: The day of the
month on which the
Monthly Payment
is due on a
Mortgage Loan, exclusive of any days of grace.
Escrow Account: The
separate account
created and maintained
pursuant to
Section 2.06 of the Servicing Agreement (with respect to each
Mortgage Loan, as
specified therein.
Escrow Payments:
With
respect to any Mortgage Loan, the amounts
constituting ground
rents, taxes, assessments, water rates, sewer rents,
municipal charges,
mortgage insurance premiums, fire and hazard insurance
premiums, condominium charges, and any other payments required to
be escrowed by
the Mortgagor with the mortgagee pursuant to the Mortgage or any
other document.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Fannie Mae: The Federal National Mortgage Association, or any successor
thereto.
Fannie Mae
Guides: The Fannie Mae Sellers' Guide and the Fannie Mae
Servicers' Guide, and all amendments or additions thereto.
Fannie Mae Transfer: As defined in Article XIII.
FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.
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.
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Fixed Rate Mortgage Loan: A fixed rate mortgage loan purchased
pursuant to
this Agreement.
Freddie Mac: The Federal Home Loan Mortgage Corporation, or any successor
thereto.
Freddie Mac Transfer: As defined in Article XIII.
Gross Margin: With respect to each Adjustable Rate Mortgage Loan,
the fixed
percentage amount set
forth in the related
Mortgage Note which amount is added
to the Index in
accordance
with the terms of the related Mortgage Note to
determine on each Interest Rate Adjustment Date the Mortgage Interest Rate for
such Mortgage Loan.
High
Cost Loan: A Mortgage
Loan (a) covered by the Home Ownership and
Equity Protection Act of 1994 ("HOEPA"), (b) with an "annual
percentage rate" or
total "points and fees" payable by the related
Mortgagor (as each
such term is
calculated under
HOEPA) that exceed the
thresholds set forth
by HOEPA and its
implementing regulations, including 12 C.F.R. ss.
226.32(a)(1)(i) and (ii), (c)
classified as a "high cost home," "threshold," "covered," (excluding New
Jersey
"Covered Home Loans" as that term was defined in clause (1) of the
definition of
that term in the New
Jersey Home Ownership Security Act of 2002 that were
originated between
November 26, 2003 and July 7, 2004), "high risk home,"
"predatory" or similar loan under any other applicable state, federal or local
law (or a similarly
classified loan using
different terminology under a law
imposing heightened
regulatory
scrutiny or
additional
legal liability for
residential mortgage
loans having high interest rates, points and/or fees) or
(d) categorized
as High Cost
pursuant to Appendix E of Standard & Poor's
Glossary. For
avoidance of doubt,
the parties agree that this definition shall
apply to any law
regardless of whether such law is presently, or in the future
becomes, the subject of judicial review or litigation.
Home
Loan: A Mortgage Loan
categorized as Home Loan pursuant to Appendix E
of Standard & Poor's Glossary.
HUD:
The Department of Housing and Urban Development, or any federal
agency
or official thereof which may from time to time succeed to the
functions thereof
with regard to FHA Mortgage Insurance. The term "HUD," for purposes of
this ---
Agreement, is also
deemed to include
subdivisions thereof
such as the FHA and
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
insurance policies insuring the Mortgage Loan or the related
Mortgaged Property.
Interest Rate
Adjustment
Date: With respect to each Adjustable Rate
Mortgage Loan, the date, specified in the related Mortgage
Note and the related
Mortgage Loan Schedule, on which the Mortgage Interest Rate is
adjusted.
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Interim Funder:
With respect to each
MERS Designated
Mortgage Loan, the
Person named on the
MERS System as the
interim funder pursuant to the MERS
Procedures Manual.
Investor: With respect
to each MERS
Designated Mortgage
Loan, the Person
named on the MERS System as the investor pursuant to the MERS
Procedures Manual.
Lifetime Rate Cap: The provision of each Mortgage Note related to an
Adjustable Rate
Mortgage Loan which provides for an absolute maximum Mortgage
Interest Rate
thereunder. The
Mortgage Interest Rate
during the terms of each
Adjustable Rate Mortgage Loan shall not at any time exceed the
Mortgage Interest
Rate at the time of
origination of such
Adjustable Rate
Mortgage Loan by more
than the Lifetime
Rate Cap set
forth as an amount
per annum on the related
Mortgage Loan Schedule.
Liquidation Proceeds:
Cash received in connection with the liquidation of a
defaulted Mortgage Loan, whether through the sale or assignment of
such Mortgage
Loan, trustee's sale,
foreclosure sale or
otherwise or the sale of the related
Mortgaged Property if
the Mortgaged Property is acquired in satisfaction of the
Mortgage Loan.
Loan-to-Value Ratio or
LTV: With respect to any Mortgage Loan, the ratio
(expressed as a percentage) of the outstanding principal amount of the
Mortgage
Loan as of the related Cut-off Date (unless otherwise indicated),
to the lesser
of (a) the 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.
LPMI
Fee: With respect to each Mortgage Loan which has an LPMI Policy,
the
portion of the Mortgage Interest Rate as set forth on the
related Mortgage Loan
Schedule (which shall
be payable solely from
the interest
portion of Monthly
Payments, Insurance
Proceeds, Condemnation
Proceeds or Liquidation Proceeds),
which, during such period prior to the required cancellation of the
LPMI Policy,
shall be used to pay the premium due on the related LPMI
Policy.
LPMI
Policy: A policy of primary mortgage guaranty insurance issued by an
insurer acceptable
under the Underwriting Guidelines and qualified to do
business in the jurisdiction where the Mortgaged Property is located, pursuant
to which the
related premium is to be paid by the Servicer of the related
Mortgage Loan from payments of interest made by the Mortgagor in an
amount as is
set forth in the related Mortgage Loan Schedule.
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.
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MERS
Procedures Manual:
The MERS Procedures
Manual, as it may be amended,
supplemented or otherwise modified from time to time.
MERS
Report: The report from the MERS System listing MERS Designated
Mortgage Loans and other information.
MERS
System: MERS mortgage electronic registry system, as more
particularly
described in the MERS Procedures Manual.
Monthly Payment: The scheduled monthly payment of principal and
interest on
a Mortgage Loan.
Moody's: Moody's Investors Service, Inc., and any successor
thereto.
Mortgage: The
mortgage, deed of trust or other instrument securing a
Mortgage Note, which
creates a first lien, in the case of a First Lien Loan, or
a second lien, in the case of a Second Lien Loan, on an
unsubordinated estate in
fee simple in real property securing the Mortgage Note; except that
with respect
to real property located in jurisdictions in which the use of
leasehold estates
for residential properties is a widely accepted practice, the
mortgage, deed of
trust or other instrument securing the Mortgage Note may secure and
create, with
respect to a First Lien Loan, a first lien, and with respect to a Second Lien
Loan, a second lien,
in each case, upon a
leasehold estate of
the Mortgagor.
With respect to a Co-op Loan, the Security Agreement.
Mortgage File: The items pertaining to a particular Mortgage Loan referred
to in Exhibit A annexed hereto, and any additional documents required to be
added to the Mortgage File pursuant to this Agreement.
Mortgage Interest
Rate: The annual rate of interest
borne on a
Mortgage
Note with respect to each Mortgage Loan.
Mortgage Interest Rate
Cap: With respect to
an Adjustable
Rate Mortgage
Loan, the limit on
each Mortgage Interest
Rate adjustment as set
forth in the
related Mortgage Note.
Mortgage Loan:
An individual Mortgage Loan which is the subject
of this
Agreement, each Mortgage Loan riginally sold and subject to this
Agreement being
identified on the
applicable
Mortgage Loan Schedule, which Mortgage Loan
includes without
limitation the Mortgage File, the Monthly Payments, Principal
Prepayments,
Liquidation Proceeds,
Condemnation Proceeds,
Insurance Proceeds,
Servicing Rights
and all other
rights, benefits, proceeds and obligations
arising from or in connection with such Mortgage Loan, excluding replaced or
repurchased mortgage loans.
Mortgage Loan
Documents:
The documents required to be delivered to
the
Custodian pursuant to Section 6.03 with respect to any Mortgage
Loan.
Mortgage Loan
Package: Each pool of Mortgage Loans, which shall be
purchased by the
Purchaser from the Seller from time to time
on each Closing
Date.
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Mortgage Loan
Remittance Rate:
With respect to each
Mortgage Loan,
the
annual rate of interest remitted to the Purchaser,
which shall be equal
to the
Mortgage Interest Rate minus the Servicing Fee Rate and LPMI Fee,
if applicable.
Mortgage Loan
Schedule: The schedule
of Mortgage Loans
setting forth the
following information with respect to each Mortgage Loan in the
related Mortgage
Loan Package:
(1) the Seller's Mortgage Loan identifying number; (2) the
Mortgagor's name; (3) the street address of the Mortgaged Property
including the
city, state
and zip code;
(4) a code
indicating
whether the Mortgagor is
self-employed;
(5) a code indicating whether the Mortgaged Property is
owner-occupied, investment property or a second home; (6) the
number and type of
residential units
constituting
the Mortgaged
Property (e.g., single family
residence, a two- to four-family dwelling, condominium, planned
unit development
or cooperative); (7)
the original months to maturity or the remaining months to
maturity from the
related Cut-off Date, in any case based on the original
amortization schedule
and, if different, the maturity expressed in the same
manner but based on the actual amortization schedule; (8) with respect to each
First Lien Loan, the
Loan-to-Value Ratio at
origination,
and with respect
to
each Second Lien Loan, the CLTV at origination; (9) the Mortgage Interest Rate
as of the related Cut-off Date; (10) the date on which the first
Monthly Payment
was due on the Mortgage Loan and, if such date is not
consistent
with the Due
Date currently in effect, the Due Date; (11) the stated
maturity date; (12) the
amount of the Monthly
Payment as of the
related Cut-off
Date; (13) the last
payment date
on which a payment was actually applied to the outstanding
principal balance; (14) the original principal amount of the
Mortgage Loan; (15)
the principal
balance of the
Mortgage Loan as of
the close of business on the
related Cut-off Date, after deduction of payments of principal due
and collected
on or before the related Cut-off Date; (16) with respect to each
Adjustable Rate
Mortgage Loan,
the Interest Rate
Adjustment
Date; (17) with respect to each
Adjustable Rate
Mortgage Loan, the Gross Margin; (18) with respect to each
Adjustable Rate
Mortgage Loan, the Lifetime Rate Cap under the terms of
the
Mortgage Note; (19)
with respect to each
Adjustable Rate Mortgage Loan, a code
indicating the type of Index; (20) the type of Mortgage Loan
(i.e., Fixed Rate
or Adjustable
Rate Mortgage Loan, First or Second Lien Loan); (21) a code
indicating the purpose of the loan (i.e., purchase, rate/term refinance, equity
take-out refinance);
(22) a code indicating
the documentation
style (i.e. no
documents, full,
alternative,
reduced, no income/no asset, stated income,
no
ratio, reduced or
NIV); (23) asset
verification
(Y/N); (24) the loan credit
classification (as described in the Underwriting Guidelines);
(25) whether such
Mortgage Loan provides for a Prepayment Penalty; (26) the Prepayment Penalty
period of such Mortgage Loan, if applicable; (27) a description of the
Prepayment Penalty,
if applicable; (28) the Mortgage Interest Rate as of
origination; (29)
the credit risk score (FICO score); (30) the date of
origination; (31) with
respect to each
Adjustable
Rate Mortgage Loan, the
Mortgage Interest Rate adjustment period; (32) with respect to each
Adjustable
Rate Mortgage Loan, the Mortgage Interest Rate adjustment
percentage; (33)
with
respect to each Adjustable Rate Mortgage Loan, the Mortgage
Interest Rate floor;
(34) the Mortgage
Interest Rate calculation method (i.e., 30/360, simple
interest, other);
(35) with respect to
each Adjustable Rate Mortgage Loan, the
Periodic Rate Cap as of the first Interest Rate Adjustment Date; (36) a code
indicating whether the
Mortgage Loan is a Balloon Mortgage Loan; (37) a code
indicating whether the
Mortgage Loan is a Home Loan; (38) the original Monthly
Payment due; (39) the Appraised Value; (40) appraisal verification (Y/N); (41)
type of appraisal
verification,
if any; (42) a code indicating whether the
Mortgage Loan is covered by a PMI Policy and, if so, identifying the PMI Policy
provider; (43) PMI
coverage percentage;
(44) in connection
with a condominium
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unit, a code
indicating
whether the
condominium
project where such unit is
located is low-rise or high-rise; (45) a code indicating
whether the
Mortgaged
Property is a
leasehold estate; (46) the MERS Identification Number, if
applicable; (47) a
code indicating
the documentation style, as required by
Standard & Poor's
criteria; (48) number
of times previously 30+ delinquent (if
applicable); and (49)
with respect to each
Option ARM
Mortgage Loan, (a) a
detailed transaction
history indicating how all payments were applied, (b)
negative amortization
indicator (Y/N), (c) the total negative amortization
amount as of the Closing Date, (d) the maximum negative
amortization percentage,
(e) the recast period,
and (f) all
adjustable
rate change histories. With
respect to the
Mortgage Loans in the
aggregate,
the related Mortgage Loan
Schedule shall set forth the following information, as of the related Cut-off
Date: (1) the number of Mortgage Loans; (2) the current aggregate outstanding
principal balance of
the Mortgage
Loans; (3) the weighted average Mortgage
Interest Rate of the Mortgage Loans; (4) the weighted average maturity of the
Mortgage Loans; (5) the average principal balance of the Mortgage
Loans; (6) the
applicable Cut-off Date; and (7) the applicable Closing Date.
Mortgage Note:
The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.
Mortgaged Property:
With respect to a Mortgage Loan that is not a Co-op
Loan, the Mortgagor's real property (or leasehold estate, if applicable)
securing repayment of
a related Mortgage Note, consisting of an
unsubordinated
estate in fee simple or, with respect to real property located in jurisdictions
in which the use of leasehold estates for residential properties is a
widely-accepted
practice, a leasehold
estate, in a single parcel or multiple
parcels of real property improved by a Residential Dwelling. With respect to a
Co-op Loan,
the stock allocated 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.
OCC:
Office of the Comptroller of the Currency, and any successor
thereto.
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
Seller, and
delivered to the
Purchaser as required by this
Agreement.
Opinion of Counsel: A
written opinion of
counsel, who may be
counsel for
the Seller, reasonably acceptable to the Purchaser, provided that
any Opinion of
Counsel relating
to (a) the qualification of any account required to be
maintained pursuant to this Agreement as an Eligible Account,
(b) qualification
of the Mortgage Loans
in a REMIC or (c) compliance with the REMIC Provisions,
must be (unless
otherwise stated in such Opinion of Counsel) an opinion of
counsel who (i) is in
fact independent
of the Seller and any
servicer of the
Mortgage Loans,
(ii) does not have any
material direct or
indirect financial
interest in the Seller or any servicer of the Mortgage Loans or in an Affiliate
of either 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.
-9-
<PAGE>
Option ARM Mortgage
Loan: An Adjustable
Rate Mortgage Loan
that gives the
related Mortgagor three different payment options each month, which
include: (i)
a minimum monthly payment option, (ii) an interest-only
payment option or
(iii)
a full principal and interest option which amortizes over 30 years
or less.
OTS:
Office of Thrift Supervision, and any successor thereto.
Periodic Rate Cap:
The provision of each Mortgage Note related to an
Adjustable Rate
Mortgage Loan which provides for an absolute maximum amount by
which the Mortgage Interest Rate therein may increase or decrease
on an Interest
Rate Adjustment
Date above or below
the Mortgage Interest
Rate previously in
effect. The Periodic Rate Cap for each Adjustable Rate Mortgage
Loan is the rate
set forth as such on the related Mortgage Loan Schedule.
Person: Any
individual,
corporation,
partnership,
limited liability
company, joint venture, association, joint-stock company, trust,
unincorporated
organization, government or any agency or political subdivision
thereof.
PMI
Policy: A policy of
primary mortgage
guaranty insurance
issued by an
insurer acceptable
under the Underwriting Guidelines and qualified to do
business in the jurisdiction where the Mortgaged Property is
located.
Preliminary Mortgage Schedule: As defined in Article III.
Prepayment Penalty:
With respect to each Mortgage Loan, the penalty if the
Mortgagor prepays such Mortgage Loan as provided in the related
Mortgage Note or
Mortgage.
Principal Prepayment:
Any payment or other recovery of principal on a
Mortgage Loan which is received in advance of its scheduled Due
Date, including
any Prepayment Penalty
or premium thereon,
and which is not
accompanied by an
amount of interest
representing scheduled
interest due on any date or dates in
any month or months subsequent to the month of prepayment.
Purchase Price: The price paid on the related Closing Date by the
Purchaser
to the Seller in exchange for the Mortgage Loans purchased on such Closing Date
as calculated in Article IV of this Agreement.
Purchase Price and Terms Agreement: Those certain agreements setting
forth
the general terms and
conditions of the
transactions
consummated
herein and
identifying the Mortgage Loans to be purchased from time to time
hereunder,
by
and between the Seller and the Purchaser.
Purchaser:
Barclays Bank
PLC, a public limited liability company,
registered in England and Wales under Company number 1026167 and its
successors
in interest and assigns, or any successor to the Purchaser
under this Agreement
as herein provided.
Qualified Appraiser: An appraiser, duly appointed by the Seller,
who had no
interest, direct or
indirect, in the
Mortgaged Property or in any loan made on
the security thereof, and whose compensation was not affected by
the approval or
-10-
<PAGE>
disapproval of the
Mortgage Loan, and
such appraiser and the appraisal made by
such appraiser
both satisfied the requirements of Title XI of the Financial
Institutions Reform,
Recovery, and
Enforcement Act of 1989 and the regulations
promulgated
thereunder, all as in
effect on the date the Mortgage Loan was
originated.
Qualified
Correspondent: Any
Person from which the Seller purchased
Mortgage Loans,
provided that the following conditions are satisfied: (i) such
Mortgage Loans were originated pursuant to an agreement
between the Seller
and
such Person that contemplated that such Person would underwrite
mortgage loans
from time to time, for
sale to the Seller,
in accordance with underwriting
guidelines designated by the Seller ("Designated Guidelines") or
guidelines that
do not vary materially from such Designated Guidelines; (ii) such
Mortgage Loans
were in fact
underwritten as described in clause (i) above and were acquired
by
the Seller within 180 days after origination; (iii) either (x) the Designated
Guidelines were, at
the time such Mortgage Loans were originated, used by the
Seller in origination
of mortgage loans of
the same type as the Mortgage Loans
for the Seller's own account or (y) the Designated Guidelines were, at the time
such Mortgage Loans were underwritten, designated by the Seller on a
consistent
basis for use by lenders in originating mortgage loans to be purchased by the
Seller; and (iv) the
Seller employed, at the time such Mortgage Loans were
acquired by
the Seller, pre-purchase or post-purchase quality assurance
procedures (which
may involve, among other things, review of a sample of
mortgage loans purchased during a particular time period or
through particular
channels) designed to ensure that Persons from which it purchased
mortgage loans
properly applied the underwriting criteria designated by the
Seller.
Qualified Substitute
Mortgage Loan: A mortgage loan eligible to be
substituted by the Seller for a Deleted Mortgage Loan which must,
on the date of
such substitution, (i) have an outstanding principal balance, after
deduction of
all scheduled
payments due in the
month of substitution
(or in the case of
a
substitution of more
than one mortgage loan
for a Deleted Mortgage
Loan, an
aggregate principal balance), not in excess of the outstanding
principal balance
of the Deleted
Mortgage Loan (the amount of any shortfall will be deposited in
the 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); and
(v) comply with each representation and warranty (respecting
individual Mortgage
Loans) set forth in Article IX.
Reconstitution: Any Securitization Transaction or Whole Loan
Transfer.
Reconstitution
Agreements: The agreement or agreements entered into by the
Seller and the Purchaser and/or certain third parties on the
Reconstitution Date
or Dates with respect to any or all of the Mortgage Loans sold hereunder, in
connection with a
Whole Loan Transfer,
Agency Transfer or a Securitization
Transaction pursuant to Article XIII, including, but not limited to, a seller's
warranties and servicing agreement with respect to a Whole Loan
Transfer, and a
pooling and servicing
agreement and/or
seller/servicer
agreements and related
custodial/trust
agreement and
documents with respect to a Securitization
Transaction.
-11-
<PAGE>
Reconstitution Date: As defined in Article XIII.
Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation AB),
17 C.F.R. ss.ss.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. 1506-1631
(Jan. 7, 2005)) or by the staff of
the Commission,
or as may be provided
by the Commission or its staff from time
to time.
Relief Act: The Servicemembers' Civil Relief Act.
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 Servicing Agreement (with
respect to each Mortgage Loan, as specified therein).
Repurchase Price:
As defined in the related Purchase Price and Terms
Agreement.
Residential Dwelling:
Any one of the following: (i) a detached one-family
dwelling, (ii) a
detached two- to
four-family
dwelling, (iii) a one-family
dwelling unit in a
condominium
project or (iv) a one-family dwelling in a
planned unit
development,
none of which is a
dwelling unit in a
residential
cooperative housing corporation, mobile home or manufactured
home.
RESPA: Real Estate Settlement Procedures Act, as amended from time
to time.
Second Lien Loan: A Mortgage Loan secured by a second lien
Mortgage on the
related Mortgaged Property.
Securities Act: The Securities Act of 1933, as amended.
Securitization Transaction: Any transaction involving either
(1) a sale or
other transfer of some or all of the Mortgage Loans directly or
indirectly to an
issuing entity in connection with an issuance of publicly
offered or
privately
placed, rated or
unrated mortgage-backed securities or (2) an issuance of
publicly offered or privately placed, rated or unrated securities,
the payments
on which are
determined primarily
by reference to one or
more portfolios
of
residential mortgage
loans consisting,
in whole or in part,
of some or all of
the Mortgage Loans.
-12-
<PAGE>
Security Agreement: The
agreement creating a security interest in the stock
allocated to a dwelling unit in the residential cooperative housing
corporation
that was pledged to secure such Co-op Loan and the related Co-op
Lease.
Seller: As defined in the initial paragraph of the Agreement,
together with
its successors in interest.
Seller Information: As defined in Section 16.04(a).
Servicer: American
Home Mortgage Servicing, Inc., or its successor in
interest or assigns,
or any successor to the Servicer under the Servicing
Agreement, as therein provided.
Servicing Agreement:
The agreement to be entered into by the Purchaser and
the Servicer,
providing for the Servicer to service the Mortgage Loans as
specified by the Servicing Agreement.
Servicing Fee: With
respect to each Mortgage Loan subject to the Servicing
Agreement, a fee
payable monthly equal to one-twelfth of the product of (a) the
Servicing Fee Rate and (b) the outstanding principal balance of such Mortgage
Loan. Such fee shall
be payable monthly and
shall be pro-rated for any portion
of a month during which the Mortgage Loan is serviced by the
Servicer under the
Servicing Agreement. The obligation of the Purchaser to pay the
Servicing Fee is
limited to, and the Servicing Fee is payable solely from,
the interest
portion
(including recoveries with respect to interest from Liquidation
Proceeds, to the
extent permitted by
this Agreement) of
such Monthly Payment
collected by the
Servicer or as otherwise provided under this Agreement.
Servicing Fee
Rate: An amount per annum as set forth in the
Servicing
Agreement.
Servicing File:
With respect to each
Mortgage Loan, the
file retained by
the Seller during the period in which the Seller is acting as
servicer pursuant
to the Servicing
Agreement consisting of originals of all documents in the
Mortgage File which
are not delivered
to the Purchaser, its designee or the
Custodian and copies of the Mortgage Loan Documents.
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 Item 1101(l) of
Regulation
AB, with respect to any Securitization Transaction.
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<PAGE>
Standard & Poor's:
Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies Inc., and any successor thereto.
Standard & Poor's Glossary: The Standard & Poor's
LEVELS(R) Glossary,
as
may be in effect from time to time.
Stated Principal
Balance: As to each Mortgage Loan (i) the principal
balance of the Mortgage Loan at the related Cut-off Date after giving effect
to
payments of principal due on or before such date, whether or not
received, minus
(ii) all amounts
previously distributed
to the Purchaser
with respect to
the
related Mortgage
Loan representing payments or recoveries of principal or
advances in lieu thereof.
Static Pool
Information: Static
pool information
as described in Item
1105(a)(1)-(3) and 1105(c) of Regulation AB.
Successor Servicer:
Any servicer of one or
more Mortgage Loans designated
by the Purchaser as being entitled to the benefits of the
indemnifications
set
forth in Sections 9.03 and 14.01.
Third-Party Originator: Each Person, other than a
Qualified Correspondent,
that originated Mortgage Loans acquired by the Seller.
Underwriting Guidelines: The underwriting guidelines of the
Seller, a copy
of which is attached as an exhibit to the related Assignment and
Conveyance.
Whole Loan Transfer:
Any sale or transfer
of some or all of the
Mortgage
Loans, other than a Securitization Transaction.
ARTICLE II
AGREEMENT TO PURCHASE
---------------------
Section 2.01
Agreement to Purchase.
---------------------
The
Seller agrees to sell from time to time, and the Purchaser agrees to
purchase from time to time, Mortgage Loans having an aggregate
principal balance
on the related Cut-off
Date in an amount as
set forth in the related Purchase
Price and Terms
Agreement, or in such
other amount as agreed by the Purchaser
and the Seller as evidenced by the actual aggregate principal balance of the
Mortgage Loans accepted by the Purchaser on each Closing Date.
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<PAGE>
ARTICLE III
MORTGAGE SCHEDULES
------------------
Section 3.01
Preliminary Mortgage Schedule.
------------------------------
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").
Section 3.02
Delivery of Mortgage Loan Schedule.
-----------------------------------
The
Seller shall
deliver the related Mortgage Loan Schedule for the
Mortgage Loans to be purchased on a particular Closing Date to the Purchaser
at
least five (5)
Business Days prior to
the related Closing
Date. The related
Mortgage Loan Schedule shall be the related Preliminary Mortgage Schedule with
those Mortgage
Loans which have not
been funded prior to
the related
Closing
Date deleted.
ARTICLE IV
PURCHASE PRICE
--------------
Section 4.01
Purchase Price.
---------------
The
Purchase Price for each Mortgage Loan shall be the percentage of
par as
stated in the related Purchase Price and Terms Agreement
(subject to
adjustment
as provided therein),
multiplied by the aggregate principal balance, as of the
related Cut-off Date, of the Mortgage Loans listed on the related
Mortgage Loan
Schedule, after
application of scheduled payments of principal due on or before
the related Cut-off Date, whether or not collected. The initial
principal amount
of the Mortgage Loans shall be the aggregate principal balance of the Mortgage
Loans, so computed as of the related Cut-off Date. If so provided
in the related
Purchase Price and
Terms Agreement,
portions of the
Mortgage Loans shall be
priced separately.
In
addition to the Purchase Price as described above, the Purchaser shall
pay to the Seller, at closing, accrued interest on the current
principal amount
of the related
Mortgage Loans as of
the related Cut-off
Date at the
weighted
average Mortgage
Interest Rate of the Mortgage Loans, minus any amounts
attributable to
Servicing Fees as provided in the Servicing Agreement from the
related Cut-off
Date through the day prior to the related Closing Date,
inclusive. 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, (provided, however, that all scheduled
payments
of principal due on or
before the Cut-off
Date and collected by
the Seller or
any successor
servicer after the related Cut-off Date shall belong to the
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<PAGE>
Seller), and
(3) all payments of interest on the Mortgage Loans net of
applicable Servicing
Fees (minus
that portion of any such payment which is
allocable to the
period prior to the related Cut-off Date). The outstanding
principal balance
of each Mortgage Loan as of the related Cut-off Date is
determined after
application
of payments of principal due on or before the
related Cut-off Date,
whether or not
collected, together
with any unscheduled
principal prepayments
collected prior to such Cut-off Date; provided, however,
that payments of scheduled principal and interest prepaid for
a Due Date beyond
the related Cut-off Date shall not be applied to the principal
balance as of the
related Cut-off
Date. Such prepaid amounts shall be the property of the
Purchaser. The Seller
shall deposit any such prepaid amounts into the Custodial
Account, which
account is
established
for the benefit of the
Purchaser for
subsequent remittance by the Seller to the Purchaser.
ARTICLE V
EXAMINATION OF MORTGAGE FILES
-----------------------------
Section 5.01
Examination of Mortgage Files.
------------------------------
At
least ten (10)
Business Days prior to
the related Closing
Date, the
Seller shall (a)
deliver to the
Purchaser or its designee in escrow, for
examination with
respect to each
Mortgage Loan to be
purchased,
the related
Mortgage File,
including a copy of
the Assignment of
Mortgage, pertaining
to
each Mortgage
Loan, or (b) make the related
Mortgage File available to the
Purchaser for
examination
at such other location as shall otherwise be
acceptable to the Purchaser. Such examination may be made by the Purchaser
or
its designee at any reasonable time before or after the related
Closing Date. If
the Purchaser
makes such
examination
prior to the related
Closing Date and
determines, in its sole discretion, that any Mortgage Loans are
unacceptable to
the Purchaser
for any reason,
such Mortgage Loans shall be deleted from
the
related Mortgage Loan
Schedule, and may be
replaced by a Qualified Substitute
Mortgage Loan (or Loans) acceptable to the Purchaser. The Purchaser may, at its
option and without
notice to the Seller,
purchase some or all
of the Mortgage
Loans without conducting any partial or complete examination.
The fact that the
Purchaser or its designee has conducted or has failed to conduct
any partial or
complete examination
of the Mortgage Files shall not affect the Purchaser's (or
any of its
successor's) rights to
demand repurchase, substitution or other
relief as provided herein.
ARTICLE VI
CONVEYANCE FROM SELLER TO PURCHASER
-----------------------------------
Section 6.01
Conveyance of Mortgage Loans.
-----------------------------
The
Seller, simultaneously
with the delivery of the Mortgage Loan Schedule
with respect to the
related Mortgage Loan Package to be purchased on each
Closing Date, shall
execute and deliver an Assignment and Conveyance Agreement
in the form attached
hereto as Exhibit H (the "Assignment and Conveyance
Agreement"). The
Seller shall cause the Servicing File retained by the Servicer
pursuant to this
Agreement and the
Servicing Agreement to be appropriately
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<PAGE>
identified in the
Servicer'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
Servicing Agreement,
except when such
release is required in
connection with a repurchase of any such Mortgage Loan pursuant to
Section 9.03.
Section 6.02
Books and Records.
------------------
Record title to each
Mortgage as of the
related Closing Date
shall be in
the name of the Seller, an Affiliate of the Seller, the Purchaser
or one or more
designees of the Purchaser, as the Purchaser shall select.
Notwithstanding
the
foregoing, each
Mortgage and related Mortgage Note shall be possessed solely by
the Purchaser or the appropriate designee of the Purchaser,
as the case may
be.
All rights arising out of the Mortgage Loans including,
but not limited to,
all
funds received by the Seller 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.
Section 6.03
Delivery of Mortgage Loan Documents.
------------------------------------
The
Seller shall deliver and release to the Custodian no later than two
(2)
Business Days prior to the related Closing Date those Mortgage Loan Documents
set forth on Exhibit A hereto 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
for the related
Closing Date. The Purchaser shall pay all fees and expenses
of
the Custodian.
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<PAGE>
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, conversion 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
hereunder, 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 60 days of discovery or
receipt of written notification of such failure from the Purchaser,
the related
Mortgage Loan shall,
upon the request of the Purchaser, be repurchased by the
Seller at the price and in the manner specified in Section 9.03.
The foregoing
repurchase obligation
shall not apply in the event that the Seller cannot
deliver an original document submitted for recordation to the
appropriate public
recording office
within the specified period due to a delay caused by the
recording office in the applicable jurisdiction; provided that the Seller shall
instead deliver
a recording receipt of such recording office or, if such
recording receipt is
not available,
an officer's
certificate
of a servicing
officer of the Seller,
confirming that such
documents have been accepted for
recording; provided
that, upon request of the Purchaser and delivery by the
Purchaser to the Seller of a schedule of the related Mortgage Loans, the Seller
shall reissue and
deliver to the
Purchaser or its designee said officer's
certificate.
The
Seller shall pay all initial recording fees, if any, for the
assignments of mortgage and any other fees or costs in transferring
all original
documents to the Custodian or, upon written request of the Purchaser, to the
Purchaser or the Purchaser's designee. The Purchaser or the
Purchaser's designee
shall be responsible
for recording the Assignments of Mortgage and shall be
reimbursed by the
Seller for the costs
associated therewith
pursuant to the
preceding sentence.
Section 6.04
Quality Control Procedures.
---------------------------
The
Seller shall, and 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's loan production and the servicing activities of the
Servicer. The program
is to ensure that the Mortgage Loans are originated and
serviced in accordance with prudent mortgage banking practices and accounting
principles; guard
against dishonest,
fraudulent, or
negligent acts; and guard
against errors
and omissions by officers, employees, or other authorized
persons.
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Section 6.05
MERS Designated Loans.
----------------------
With
respect to each MERS Designated Mortgage Loan, the Seller shall, on
or
prior to the related
Closing Date,
designate the Purchaser as the Investor and
the Custodian as custodian, and no Person shall be listed as
Interim Funder on
the MERS System. In
addition, on or prior
to the related Closing Date, Seller
shall provide the Custodian and the Purchaser with a MERS Report listing the
Purchaser as the
Investor, the
Custodian as custodian and no Person as Interim
Funder with respect to each MERS Designated Mortgage Loan.
ARTICLE VII
SERVICING OF THE MORTGAGE LOANS
-------------------------------
Section 7.01
Servicing.
----------
The
Mortgage Loans have been sold by the Seller to the Purchaser on a
servicing retained basis.
The
Purchaser shall retain the Servicer as independent contract
servicer of
the Mortgage Loans
pursuant to and in accordance with the terms and conditions
contained in the
Servicing Agreement. The Seller shall cause the
Servicer to
execute the Servicing Agreement on the initial Closing Date.
Pursuant to the Servicing Agreement, the Seller shall cause the
Servicer to
transfer the
servicing of the
Mortgage Loans on
behalf of the
Purchaser and
shall be entitled to the Servicing Fee and any Ancillary
Income with respect
to
such Mortgage Loans from the related Closing Date until the
termination of the
Servicing Agreement
with respect to any of
the Mortgage Loans as
set forth in
the Servicing Agreement. The Servicer shall conduct such servicing
in accordance
with the terms of the Servicing Agreement.
ARTICLE VIII
[RESERVED]
ARTICLE IX
REPRESENTATIONS, WARRANTIES AND COVENANTS
OF THE SELLER; REMEDIES FOR BREACH
----------------------------------
Section 9.01
Representations and Warranties Regarding the Seller.
----------------------------------------------------
The
Seller represents,
warrants and covenants
to the Purchaser that as of
the date hereof and as of each Closing Date:
(a)
Due Organization and Authority. The Seller is a duly organized,
validly
existing, and in good
standing under the
laws of the state of New York and has
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all licenses necessary
to carry on its business as now being conducted and is
licensed, qualified
and in good
standing in the states where the Mortgaged
Property is located if the laws of such state require licensing or
qualification
in order to conduct business of the type conducted by the Seller.
The Seller has
corporate power and
authority to execute and deliver
this Agreement and to
perform its obligations hereunder; the execution, delivery and performance of
this Agreement
(including all instruments of transfer to be delivered pursuant
to this Agreement)
by the Seller and the consummation of the transactions
contemplated hereby
have been duly and validly authorized; this Agreement has
been duly executed and delivered and constitutes the valid,
legal, binding and
enforceable obligation of the Seller, except as enforceability may
be limited by
(i) bankruptcy,
insolvency, liquidation,
receivership, moratorium,
reorganization or
other similar laws affecting the enforcement of the rights of
creditors and (ii) general principles of equity, whether enforcement is sought
in a proceeding in
equity or at law. All
requisite corporate
action has been
taken by the Seller to make this Agreement valid and binding upon the Seller
in
accordance with its
terms;
(b)
No Consent Required.
No consent, approval,
authorization or order
is
required for the
transactions
contemplated by this
Agreement from any
court,
governmental agency or
body, or federal or state regulatory authority having
jurisdiction over the
Seller is required or, if required, such consent,
approval,
authorization or order has been or will, prior to the related
Closing
Date, be obtained;
(c)
Ordinary Course of Business. The consummation of the transactions
contemplated by this
Agreement are in the ordinary course of business of the
Seller, and the
transfer, assignment
and conveyance of the
Mortgage Notes and
the Mortgages by the
Seller pursuant to
this Agreement are not
subject to the
bulk transfer or any similar statutory provisions in effect in any
applicable
jurisdiction;
(d)
No Conflicts. Neither the execution and delivery of this Agreement,
the
acquisition or origination of the Mortgage Loans by the Seller,
the sale of the
Mortgage Loans
to the Purchaser, the consummation of the transactions
contemplated hereby,
nor the fulfillment of or compliance
with the terms and
conditions of this Agreement, will conflict with or result in a
breach of any of
the terms, conditions
or provisions of the Seller's charter, by-laws or other
organizational documents or any legal restriction or any agreement
or instrument
to which the
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 a
material 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, to Seller's knowledge, 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,
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operations, financial
condition, properties
or assets of the Seller, or in any
material impairment
of the right or ability of the Seller to carry on its
business substantially
as now conducted,
or in any material
liability on the
part of the Seller,
or which would draw into question the validity of this
Agreement or the
Mortgage Loans or of any action taken or to be taken in
connection with the
obligations of the
Seller contemplated
herein, or which
would be likely to impair materially the ability of the
Seller to perform under
the terms of this Agreement;
(f)
Ability to Perform;
Solvency. The Seller does not believe, nor does it
have any reason
or cause to
believe, that it cannot perform each and every
covenant contained in this Agreement. The Seller is solvent and the sale
of the
Mortgage Loans will
not cause the Seller to become insolvent. The sale of the
Mortgage Loans is not undertaken with the intent to hinder, delay
or defraud any
of Seller's creditors;
(g)
Seller's Origination.
The Seller's decision
to originate any mortgage
loan or to deny any mortgage loan application is an independent
decision based
upon the Underwriting Guidelines, and is in no way made as a result of
Purchaser's decision to purchase, or not to purchase, or the price
Purchaser may
offer to pay for, any such mortgage loan, if originated;
(h)
Anti-Money Laundering Laws. The Seller has complied with all
applicable
anti-money laundering laws, regulations and executive orders,
including without
limitation the USA Patriot Act of 2001 (collectively, the
"Anti-Money Laundering
Laws"); the Seller has established an anti-money laundering compliance program
as required by the Anti-Money Laundering Laws, has conducted the requisite
due
diligence in connection with the origination of each
Mortgage Loan for purposes
of the Anti-Money
Laundering Laws,
including with respect to the legitimacy of
the applicable Mortgagor and the origin of the assets used by the
said Mortgagor
to purchase
the property in question, and maintains, and will maintain,
sufficient information
to identify the applicable Mortgagor for purposes of the
Anti-Money Laundering
Laws. Additionally, no Mortgage Loan is subject to
nullification pursuant
to Executive Order 13224 (the "Executive Order") or the
regulations
promulgated by the
Office of Foreign
Assets Control of the United
States Department of
Treasury (the "OFAC
Regulations") or in
violation of the
Executive Order or the
OFAC Regulations;
and no Mortgagor is subject to the
provisions of such
Executive Order or the OFAC Regulations nor listed as a
"blocked person" for purposes of the OFAC Regulations;
(i)
Financial Statements. The Seller has delivered to the Purchaser
financial statements
as to its last three
complete fiscal years
and any later
quarter ended more
than 60 days prior to the execution of this Agreement. All
such financial statements fairly present 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
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<PAGE>
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
Section 9.02 could be made and such selection was not made in a manner
so as to
affect adversely the interests of the Purchaser;
(k)
Delivery to the
Custodian.
The Mortgage Note, the Mortgage, the
Assignment of Mortgage
and any other
documents required to
be delivered with
respect to each Mortgage Loan hereunder, shall be delivered to the
Custodian all
in compliance with the specific requirements of this Agreement.
With respect to
each Mortgage Loan, the Seller will be in possession of a complete
Mortgage File
in compliance
with Exhibit A hereto, except for such documents as will be
delivered to the Custodian;
(l)
Mortgage Loan Characteristics. The characteristics of the related
Mortgage Loan
Package are as set forth on the description of the pool
characteristics for
the applicable
Mortgage Loan Package delivered pursuant to
Article XI on the related Closing Date in the form attached as
Exhibit B to each
related Assignment and Conveyance Agreement;
(m)
No Untrue Information.
Neither this
Agreement nor any information,
statement, tape,
diskette, report, form, or other document
furnished or to be
furnished pursuant to
this Agreement
or any Reconstitution Agreement or in
connection with
the transactions contemplated hereby (including any
Securitization
Transaction or Whole Loan Transfer) contains 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
intends to reflect
the transfer of the
Mortgage Loans as a
sale on the books and
records of the Seller and the Seller
has determined
that the disposition of the Mortgage Loans pursuant to this
Agreement will be afforded sale treatment for tax and accounting
purposes;
(p)
Owner of Record. The Seller is the owner of record of each Mortgage
and
the indebtedness
evidenced by each Mortgage Note, except for the Assignments of
Mortgage which have been sent for recording, and upon recordation the Seller
will be the owner of record of each Mortgage and the indebtedness evidenced by
each Mortgage Note,
and upon the sale of
the Mortgage Loans to
the Purchaser,
the Seller will retain the Mortgage Files with respect thereto in
trust only for
the purpose of servicing and supervising the servicing of each
Mortgage Loan;
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<PAGE>
(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;
(r)
Credit Reporting. The Seller shall cause the Servicer to fully
furnish,
in accordance
with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information (e.g., favorable and
unfavorable)
on its borrower
credit files to Equifax, Experian and Trans Union Credit
Information Company
(three of the credit
repositories),
on a monthly
basis.
Additionally, the
Seller shall cause the Servicer to transmit full-file credit
reporting data for each Mortgage Loan pursuant to Fannie Mae Guide
Announcement
95-19 and that for each Mortgage Loan, the Seller shall cause the
Servicer to
agree to report
one of the
following statuses each month as follows: new
origination, current,
delinquent (30-, 60-,
90-days, etc.), foreclosed, or
charged-off. This
representation and
warranty is a Deemed Material and Adverse
Representation;
(s)
Seasoned Mortgage Loans. The Seller (i) currently operates or actively
participates in an
on-going and active
program or business
(A) to originate
Mortgages, (B) to make
periodic purchases of Mortgage Loans from originators or
other sellers, or (C)
to issue or purchase securities or bonds supported by the
Mortgage Loans,
with a portion of the
proceeds generated by such program or
business being used to
purchase or originate
Mortgage Loans made to Mortgagors
who are: (1) low-income families (families with incomes of 80% or
less of area
median income),
living in low-income
areas (a census tract
or block numbering
area in which the median income does not exceed 80% of the
area median
income)
or (2) very low-income
families (families with incomes of 60% or
less of area
median income); and
(ii) agrees that Freddie Mac, for a period of two (2) years
following the related
Closing Date,
may contact the Seller
to confirm that it
continues to operate or actively participate in the mortgage
program or business
and to obtain other
nonproprietary
information about the
Seller's
activities
that may assist Freddie Mac in completing its regulatory reporting
requirements.
The Seller shall make reasonable efforts to provide such
information to Freddie
Mac. This representation and warranty is a Deemed Material and Adverse
Representation;
(t)
Ability to Service. The Servicer is an approved servicer of
conventional residential adjustable and fixed rate Mortgage Loans
for Fannie Mae
or Freddie Mac, with
the facilities,
procedures,
and experienced personnel
necessary for the
sound servicing
of mortgage loans of the same type as the
Mortgage Loans. The Seller is duly qualified, licensed, registered
and otherwise
authorized under all applicable federal, state and local laws, and
regulations,
if applicable, meets
the minimum capital requirements set forth by the OTS, the
OCC or the FDIC, and
is in good standing to enforce, originate, sell mortgage
loans to, and, with
respect to the
Servicer, service mortgage loans in the
jurisdiction wherein
the Mortgaged Properties are located for either Fannie Mae
or Freddie Mac, and no event has occurred, including but not
limited to a change
in insurance coverage,
which would make the Seller or Servicer, as applicable,
unable to comply with either Fannie Mae or Freddie Mac eligibility
requirements
or which would require notification to Fannie Mae or Freddie Mac;
and
(u)
Reasonable Servicing
Fee. The Seller
acknowledges and agrees that the
Servicing Fee represents reasonable compensation for performing such services
and that the
entire Servicing Fee shall be treated by the Servicer, for
accounting and
tax purposes, as compensation for the servicing and
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<PAGE>
administration of the
Mortgage Loans pursuant to this Agreement and the
Servicing
Agreement.
Section 9.02
Representations and Warranties Regarding Individual Mortgage
-------------------------------------------------------------
Loans.
---
The
Seller hereby represents and warrants to the Purchaser that, as to
each
Mortgage Loan, as of the related Closing Date for such Mortgage
Loan:
(a)
Mortgage Loans as Described. The information set forth in the
related
Mortgage Loan Schedule is complete, true and correct;
(b)
Payments Current.
All payments
required to be made up
to the related
Closing Date for the Mortgage Loan under the terms of the Mortgage
Note, other
than payments not yet thirty (30) days delinquent, have been made and credited.
No payment
required under the Mortgage Loan is thirty (30) days or more
delinquent nor has any
payment under the Mortgage Loan been thirty (30) days or
more delinquent at any
time since the
origination of the Mortgage Loan, other
than as set forth on the related Mortgage Loan Schedule. The first Monthly
Payment shall be made
with respect to the Mortgage Loan on its related Due Date
or within the grace
period, all in
accordance
with the terms of the
related
Mortgage Note;
(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;
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<PAGE>
(e)
No Defenses.
The Mortgage Loan is not subject to any right of
rescission, set-off,
counterclaim or
defense, including without limitation the
defense of usury, nor
will the operation
of any of the terms of
the Mortgage
Note or the Mortgage, or the exercise of any right thereunder,
render either the
Mortgage Note or the
Mortgage unenforceable, in whole or in part and no
such
right of rescission,
set-off, counterclaim or defense has been asserted
with
respect thereto,
and no Mortgagor was a debtor in any state or Federal
bankruptcy or
insolvency
proceeding
at the time the Mortgage Loan was
originated;
(f)
Hazard Insurance.
Pursuant to the terms of the Mortgage, all buildings
or other improvements
upon the Mortgaged Property are insured by a
generally
acceptable insurer
against loss by fire,
hazards of extended coverage and such
other hazards as are provided for in the Fannie Mae Guides or by
Freddie Mac, as
well as all additional
requirements set forth
in Section 2.10 of the Servicing
Agreement. If required
by the National Flood Insurance Act of 1968, as amended,
each Mortgage
Loan is covered by a flood insurance policy meeting the
requirements of the current guidelines of the Federal
Insurance
Administration
as in effect which policy conforms to Fannie Mae and Freddie
Mac requirements,
as well as all additional requirements set forth in Section 2.10 of the
Servicing Agreement.
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,
equal credit opportunity, disclosure and all predatory, abusive and
fair lending
laws applicable
to the Mortgage Loan, including, without limitation, any
provisions relating to
Prepayment
Penalties,
have been complied with in all
material respects, the consummation of the transactions
contemplated hereby will
not involve
the violation of any such laws or regulations in any material
respect, 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;
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<PAGE>
(h)
No Satisfaction
of Mortgage.
The Mortgage has not been satisfied,
canceled, subordinated
or rescinded, in whole or in part, and the Mortgaged
Property has not been
released from the lien
of the Mortgage,
in whole or in
part, nor has any
instrument been
executed that would effect any such release,
cancellation,
subordination or
rescission.
The Seller has not waived the
performance by the
Mortgagor of any action, if the Mortgagor's failure to
perform such action would cause the Mortgage Loan to be in default,
nor has the
Seller waived
any default resulting from any action or inaction by the
Mortgagor;
(i)
Type of Mortgaged Property. With respect to a Mortgage Loan that is
not
a Co-op Loan,
the Mortgaged Property is a fee simple estate or a leasehold
estate located in a
jurisdiction
in which the use of a
leasehold estate for
residential properties
is a widely accepted
practice that consists of a single
parcel of real property with a detached single family residence
erected thereon,
or a two- to four-family dwelling, or an individual residential
condominium unit
in a condominium
project, or an
individual unit in a planned unit development,
or an individual unit in a residential cooperative housing corporation;
provided, however,
that any condominium unit, planned unit development or
residential
cooperative housing corporation shall conform with the
Underwriting
Guidelines. No portion
of the Mortgaged Property (or underlying Mortgaged
Property, in the case
of a Co-op Loan) is
used for commercial
purposes, and
since the date of
origination, no
portion of the
Mortgaged Property has
been
used for commercial purposes; provided, that Mortgaged
Properties which contain
a home office shall not be considered as being used for
commercial
purposes as
long as the Mortgaged Property has not been altered for commercial
purposes and
is not storing any chemicals or raw materials other than those
commonly used for
homeowner repair,
maintenance and/or household purposes. None of the Mortgaged
Properties are manufactured homes, log homes, mobile homes, geodesic domes or
other unique property types;
(j)
Valid First or
Second Lien. The Mortgage is a valid, subsisting,
enforceable and
perfected,
first lien (with
respect to a First
Lien Loan) or
second lien (with
respect to a Second
Lien Loan) on the
Mortgaged Property,
including all
buildings and
improvements
on the Mortgaged Property and all
installations and mechanical, electrical, plumbing, heating and air
conditioning
systems located in or annexed to such buildings, and all additions,
alterations
and replacements made at any time with respect to the foregoing.
The lien of the
Mortgage is subject only to:
(i) with respect to a
Second Lien Loan
only, the lien of the first
mortgage on the Mortgaged Property;
(ii) the lien of current real property taxes and assessments not yet
due
and payable;
(iii) covenants, conditions and restrictions, rights of way,
easements
and
other matters of the public record as of the date of recording
acceptable to
prudent mortgage lending institutions generally and
specifically referred
to in the lender's title insurance policy delivered
to
the originator of the Mortgage Loan and (a) specifically
referred to or
otherwise considered
in the appraisal made for the originator of the
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Mortgage Loan or (b) which do not adversely affect the Appraised
Value of
the
Mortgaged Property set forth in such appraisal; and
(iv) other matters to which like properties are commonly subject
which
do
not materially
interfere with the benefits of the security intended to
be provided by the
Mortgage or the use,
enjoyment, value or
marketability
of
the related Mortgaged Property.
Any
security agreement,
chattel mortgage or equivalent document related to
and delivered in connection with the Mortgage Loan establishes and creates a
valid, subsisting, enforceable and perfected first lien (with
respect to a First
Lien Loan) or
second lien (with respect to a Second Lien Loan) and first
priority (with respect to a First Lien Loan) or second priority
(with respect to
a Second Lien Loan) security interest on the property described therein and the
Seller has full right to sell and assign the same to the
Purchaser.
(k)
Valid First or Second Priority Security Interest. With respect to any
Co-op Loan,
the related Mortgage is a valid, subsisting, enforceable and
perfected, first
priority security interest (with respect to a First Lien Loan)
or second priority security interest (with respect to a Second Lien
Loan) on the
related cooperative shares securing the Mortgage Note, subject only
to (a) liens
of the related residential cooperative housing corporation for unpaid
assessments
representing the
Mortgagor's
pro rata share of the related
residential cooperative housing corporation's payments for its
blanket mortgage,
current and future real property taxes, insurance premiums,
maintenance fees and
other assessments
to which like
collateral is commonly
subject and (b)
other
matters to which like
collateral is commonly
subject which do not
materially
interfere with the benefits of the security interest intended to be provided
by
the related Security Agreement;
(l)
[Reserved.]
(m)
Validity of Mortgage Documents. The Mortgage Note and the Mortgage
and
any other agreement
executed and delivered
by a Mortgagor in connection with a
Mortgage Loan are genuine, and each is the legal,
valid and binding
obligation
of the maker thereof
enforceable
in accordance with its terms (including,
without limitation,
any provisions therein
relating to Prepayment
Penalties).
All parties to the
Mortgage Note, the Mortgage and any other such related
agreement had legal
capacity to enter into the Mortgage Loan and to execute and
deliver the Mortgage Note, the Mortgage and any such agreement, and
the Mortgage
Note, the Mortgage and any other such related agreement have been duly and
properly executed by
other such related
parties. No fraud,
error, omission,
misrepresentation,
negligence or similar
occurrence with respect to a Mortgage
Loan has taken place on the part of the Seller in connection with the
origination of the
Mortgage Loan or in the application of any insurance in
relation to such Mortgage Loan. No fraud, error, omission, misrepresentation,
negligence or similar occurrence with respect to a Mortgage Loan
has taken place
on the part of any Person, including without limitation, the Mortgagor, any
appraiser, any
builder or developer, or any other party involved in the
origination of the
Mortgage Loan or in
the application
for any insurance in
relation to such
Mortgage Loan.
The Seller has
reviewed all of the
documents
constituting the
Servicing File and has made such inquiries as it deems
necessary to make and
confirm the accuracy
of the representations set forth
herein;
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<PAGE>
(n)
Full Disbursement
of Proceeds.
The Mortgage Loan has
been closed and
the proceeds of the
Mortgage Loan have been fully disbursed and there is no
requirement for future advances thereunder, and any and all requirements as
to
completion of any on-site or off-site improvement and as to
disbursements of any
escrow funds therefor
have been complied
with. All costs, fees and expenses
incurred in
making or closing the Mortgage Loan and the recording of the
Mortgage were paid,
and the Mortgagor is not entitled to any refund of any
amounts paid or due under the Mortgage Note or Mortgage;
(o)
Ownership.
The Seller is the sole owner of record and holder of
the
Mortgage Loan and the indebtedness evidenced by each Mortgage Note
and upon the
sale of the Mortgage Loans to the Purchaser, the Seller will retain
the Mortgage
Files or any part thereof with respect thereto not delivered to the
Custodian,
the Purchaser
or the Purchaser's designee, in trust only for the purpose
of
servicing and supervising the servicing of each Mortgage Loan. The
Mortgage Loan
is not assigned or pledged, and the Seller has good, indefeasible
and marketable
title thereto, and has
full right to transfer and sell the Mortgage Loan to the
Purchaser free and clear of any encumbrance, equity, participation interest,
lien, pledge,
charge, claim or security interest, and has full right and
authority subject to
no interest or
participation of, or
agreement with,
any
other party, to sell
and assign each Mortgage Loan pursuant to this Agreement
and following
the sale of each
Mortgage Loan, the Purchaser will own such
Mortgage Loan free and clear of any encumbrance, equity,
participation interest,
lien, pledge,
charge, claim or security interest. The Seller intends to
relinquish all rights to possess, control and monitor the Mortgage
Loan. After
the related Closing
Date, the Seller will
have no right to modify or alter the
terms of the sale of the Mortgage Loan and the Seller will have no
obligation or
right to repurchase
the Mortgage
Loan or substitute
another Mortgage Loan,
except as provided in this Agreement;
(p)
Doing Business. All parties which have had any interest in the
Mortgage
Loan, whether as mortgagee, assignee, pledgee or otherwise,
are (or, during the
period in which they held and disposed of such interest, were) (1)
in compliance
with any and all
applicable licensing
requirements
of the laws of the
state
wherein the Mortgaged
Property is located,
and (2) either (i) organized under
the laws of such state, or (ii) qualified to do business in such
state, 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;
(q)
CLTV, LTV and PMI
Policy. No Mortgage
Loan that is a Second Lien Loan
has a CLTV greater than 100%. No Mortgage Loan has an LTV greater
than 100%. Any
Mortgage Loan
that had at the time
of origination
an LTV in excess of
80% is
insured as to payment defaults by a PMI Policy. 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;
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<PAGE>
(r)
Title Insurance.
With respect to a
Mortgage Loan which is not a Co-op
Loan, the Mortgage Loan is covered by an ALTA lender's title
insurance policy,
or with respect to any Mortgage Loan for which the related
Mortgaged Property is
located in California a CLTA lender's title insurance policy, or
other generally
acceptable form of
policy or insurance
acceptable to Fannie Mae or Freddie Mac
and each such title insurance policy is issued by a title insurer
acceptable to
Fannie Mae or Freddie Mac and qualified to do business in the
jurisdiction where
the Mortgaged
Property is located,
insuring the Seller,
its 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 Section 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 title insurance.
Additionally, such lender's title insurance policy affirmatively
insures ingress
and egress, and
against encroachments
by or upon the Mortgaged Property or any
interest therein. The
Seller, its successor and assigns, are the sole insureds
of such lender's title
insurance policy, and such lender's title insurance
policy is valid and
remains in full
force and effect and
will be in force and
effect upon the consummation of the transactions contemplated by
this Agreement.
No claims have been made under such lender's title insurance policy, and no
prior holder of the related Mortgage, including the Seller, has done, by
act or
omission, anything
which would impair the coverage of such lender's title
insurance policy,
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;
(s)
No Defaults.
Other than payments due but not yet 30 days or more
delinquent, there is
no default, breach,
violation or event which would permit
acceleration existing
under the Mortgage or the Mortgage Note and no event
which, with the
passage of time or with notice and the expiration of any grace
or cure period, would
constitute a default,
breach, violation or event which
would permit acceleration, and neither the Seller nor any of
its Affiliates nor
any of their respective predecessors, have waived any default,
breach, violation
or event which would permit acceleration;
(t)
No Mechanics' Liens. There are no mechanics' or similar liens or
claims
which have been filed for work, labor or material (and no rights
are outstanding
that under
the law could give rise to such liens) affecting the related
Mortgaged Property
which are or may be
liens prior to, or equal or coordinate
with, the lien of the related Mortgage;
(u)
Location of Improvements; No Encroachments. All improvements which
were
considered in
determining
the Appraised
Value of the Mortgaged
Property lay
wholly within the
boundaries and
building restriction
lines of the
Mortgaged
Property, and
no improvements on adjoining properties encroach upon the
Mortgaged Property.
No improvement located on or being part of the
Mortgaged
Property is in violation of any applicable zoning law or
regulation;
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<PAGE>
(v)
Origination;
Payment Terms. The Mortgage Loan was originated by a
mortgagee approved by the Secretary of Housing and Urban
Development pursuant to
Sections 203
and 211 of the National Housing Act, a savings and loan
association, a savings
bank, a commercial bank, credit union, insurance company
or other similar
institution which is
supervised and
examined by a federal or
state authority.
Principal payments on the Mortgage Loan commenced no more than
seventy days after funds were disbursed in con
