Exhibit 99.14(b)
EXECUTION COPY
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FOURTH AMENDED
AND RESTATED MORTGAGE LOAN PURCHASE
AND WARRANTIES AGREEMENT
____________________
MORGAN STANLEY MORTGAGE CAPITAL INC.,
Purchaser
MORTGAGEIT, INC.,
Seller
____________________
Dated as of March 1, 2006
Conventional,
Fixed and Adjustable Rate
Residential Mortgage Loans
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TABLE OF CONTENTS
Page
----
SECTION 1.
Definitions....................................................1
SECTION 2.
Agreement to
Purchase..........................................1
SECTION 3.
Mortgage
Schedules.............................................1
SECTION 4.
Purchase
Price.................................................1
SECTION 5.
Examination of Mortgage
Files..................................1
SECTION 6.
Conveyance from Seller to
Purchaser............................1
SECTION 7.
Servicing of the Mortgage
Loans................................1
SECTION 8.
[RESERVED].....................................................1
SECTION 9.
Representations, Warranties and Covenants of the
Seller; Remedies for
Breach....................................1
SECTION 10.
Closing........................................................1
SECTION 11.
Closing
Documents..............................................1
SECTION 12.
Costs..........................................................1
SECTION 13.
Cooperation of Seller with a
Reconstitution....................1
SECTION 14. The
Seller.....................................................1
SECTION 15.
Financial
Statements...........................................1
SECTION 16.
Mandatory Delivery; Grant of Security
Interest.................1
SECTION 17.
Notices........................................................1
SECTION 18.
Severability
Clause............................................1
SECTION 19.
Counterparts...................................................1
SECTION 20.
Intention of the
Parties.......................................1
SECTION 21.
Successors and Assigns; Assignment of Purchase
Agreement.......1
SECTION 22.
Waivers........................................................1
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SECTION 23.
Exhibits.......................................................1
SECTION 24.
General Interpretive
Principles................................1
SECTION 25.
Reproduction of
Documents......................................1
SECTION 26.
Further
Agreements.............................................1
SECTION 27.
Recordation of Assignments of
Mortgage.........................1
SECTION 28. No
Solicitation................................................1
SECTION 29.
Waiver of Trial by
Jury........................................1
SECTION 30.
Governing Law Jurisdiction; Consent to Service of
Process......1
SECTION 31.
Amendment......................................................1
SECTION 32.
Confidentiality................................................1
SECTION 33.
Entire
Agreement...............................................1
SECTION 34.
Compliance with Regulation
AB..................................1
EXHIBITS
EXHIBIT A-1
MORTGAGE LOAN DOCUMENTS
EXHIBIT A-2
CONTENTS OF EACH MORTGAGE FILE
EXHIBIT B FORM OF
INDEMNIFICATION AND CONTRIBUTION AGREEMENT
EXHIBIT C FORM OF SELLER'S
OFFICER'S CERTIFICATE
EXHIBIT D FORM OF OPINION
OF COUNSEL TO THE SELLER
EXHIBIT E FORM OF SECURITY
RELEASE CERTIFICATION
EXHIBIT F FORM OF SECURITY
RELEASE CERTIFICATION
EXHIBIT G UNDERWRITING
GUIDELINES
EXHIBIT H FORM OF
ASSIGNMENT AND CONVEYANCE AGREEMENT
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FOURTH AMENDED AND RESTATED MORTGAGE LOAN PURCHASE
--------------------------------------------------
AND WARRANTIES AGREEMENT
------------------------
THIS FOURTH AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND
WARRANTIES AGREEMENT ("AGREEMENT"), dated as of MARCH 1, 2006, by
and between
Morgan Stanley Mortgage Capital Inc., a New York corporation
(the
"Purchaser"), and MortgageIT, Inc., a New York corporation (the
"Seller").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Purchaser and the Seller are parties to that
certain
Mortgage Loan Purchase and Warranties Agreement, dated as of
October 1, 2004,
as amended by that certain Amended and Restated Mortgage Loan
Purchase and
Warranties Agreement, dated as of May 1, 2005, as amended by that
certain
Second Amended and Restated Mortgage Loan Purchase and Warranties
Agreement,
dated as of March 1, 2005, as amended by that certain Third Amended
and
Restated Mortgage Loan Purchase and Warranties Agreement, dated as
of December
1, 2005 (the "Original Purchase Agreement") and 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 mortgage loans (the
"Mortgage
Loans") on a servicing released basis as described herein, and
which shall be
delivered in pools of whole loans (each, a "Mortgage Loan Package")
on various
dates as provided herein (each, a "Closing Date");
WHEREAS, the Purchaser and the Seller desire to enter into this
Agreement to amend and restate the Original Purchase Agreement to
make certain
modifications as set forth herein with respect to all Mortgage
Loans subject
to this Agreement or the Original Purchase Agreement.
NOW, THEREFORE, in consideration of the premises and mutual
agreements set forth herein, and for other good and valuable
consideration,
the receipt and sufficiency of which are hereby acknowledged, the
Purchaser
and the Seller agree as follows:
SECTION 1. Definitions.
For purposes of this Agreement the following capitalized terms
shall
have the respective meanings set forth below.
Accepted Servicing Practices: With respect to any Mortgage
Loan,
those mortgage servicing practices which are in accordance with
accepted
mortgage servicing practices of prudent mortgage lending
institutions which
service mortgage loans of the same type as such Mortgage Loan in
the
jurisdiction where the related Mortgaged Property is located.
Act: The National Housing Act, as amended from time to time.
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Adjustable Rate Mortgage Loan: A Mortgage Loan purchased pursuant
to
this Agreement, the Mortgage Interest Rate of which is adjusted
from time to
time in accordance with the terms of the related Mortgage Note.
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 Fourth Amended and Restated Mortgage Loan
Purchase
and Warranties Agreement including all exhibits, schedules,
amendments and
supplements hereto.
ALTA: The American Land Title Association or any successor
thereto.
Appraised Value: With respect to any Mortgaged Property, the
lesser
of (i) the value thereof as determined by an appraisal made for the
originator
of the Mortgage Loan at the time of origination of the Mortgage
Loan by a
Qualified Appraiser and (ii) the purchase price paid for the
related Mortgaged
Property by the Mortgagor with the proceeds of the Mortgage Loan;
provided,
however, that in the case of a Refinanced Mortgage Loan, such value
of the
Mortgaged Property is based solely upon the value determined by an
appraisal
made for the originator of such Refinanced Mortgage Loan at the
time of
origination of such Refinanced Mortgage Loan by a Qualified
Appraiser.
Assignment and Conveyance Agreement: As defined in Subsection
6.01.
Assignment of Mortgage: An individual assignment of the
Mortgage,
notice of transfer or equivalent instrument in recordable form and
in blank,
sufficient under the laws of the jurisdiction in which the related
Mortgaged
Property is located to give record notice of 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 Interim Servicer's servicing
operations are
located or (iii) the state in which the Custodian's operations are
located,
are authorized or obligated by law or executive order to be
closed.
Cash-Out Refinance: A Refinanced Mortgage Loan in which the
proceeds
received were in excess of the amount of funds required to repay
the principal
balance of any existing first mortgage on the related Mortgaged
Property, pay
related closing costs and satisfy
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any outstanding subordinate mortgages on the related Mortgaged
Property and
which provided incidental cash to the related Mortgagor of more
than 1% of the
original principal balance of such Mortgage Loan.
Closing Date: The date or dates on which the Purchaser from time
to
time shall purchase, and the Seller from time to time shall sell,
the Mortgage
Loans listed on the related Mortgage Loan Schedule with respect to
the related
Mortgage Loan Package.
Closing Documents: The documents required to be delivered on
each
Closing Date pursuant to Section 11.
CLTA: The California Land Title Association.
CLTV: As of any date and as to any Second Lien Loan, the ratio,
expressed as a percentage, of (a) the sum of (i) the outstanding
principal
balance of the Second Lien Loan and (ii) the outstanding principal
balance as
of such date of any mortgage loan or mortgage loans that are senior
or equal
in priority to the Second Lien Loan and which are secured by the
same
Mortgaged Property to (b) the Appraised Value as determined
pursuant to the
Underwriting Guidelines of the related Mortgaged Property as of
the
origination of the Second Lien Loan.
Code: The Internal Revenue Code of 1986, as amended, or any
successor statute thereto.
Commission: The United States Securities and Exchange
Commission.
Condemnation Proceeds: All awards, compensation and settlements
in
respect of a taking of all or part of a Mortgaged Property, whether
permanent
or temporary, partial or entire, by exercise of the power of
condemnation or
the right of eminent domain, to the extent not required to be
released to a
Mortgagor in accordance with the terms of the related Mortgage Loan
Documents.
Co-op: A private, cooperative housing corporation, having only
one
class of stock outstanding, which owns or leases land and all or
part of a
building or buildings, including apartments, spaces used for
commercial
purposes and common areas therein and whose board of directors
authorizes the
sale of stock and the issuance of a Co-op Lease.
Co-op Lease: With respect to a Co-op Loan, the lease with respect
to
a dwelling unit occupied by the Mortgagor and relating to the stock
allocated
to the related dwelling unit.
Co-op Loan: A Mortgage Loan secured by the pledge of stock
allocated
to a dwelling unit in a residential cooperative housing corporation
and a
collateral assignment of the related Co-op Lease.
Covered Loan: A Mortgage Loan categorized as Covered pursuant
to
Appendix E of Standard & Poor's Glossary.
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Custodial Account: The separate trust account created and
maintained
pursuant to Subsection 2.04 of the Interim Servicing Agreement
(with respect
to each Mortgage Loan, as specified therein).
Custodial Agreement: The agreement(s) governing the retention of
the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage
and other
Mortgage Loan Documents. If more than one Custodial Agreement is in
effect at
any given time, all of the individual Custodial Agreements shall
collectively
be referred to as the "Custodial Agreement."
Custodian: LaSalle Bank National Association, a national
banking
association and its successors in interest, or any successor to the
Custodian
under the Custodial Agreement as therein provided.
Cut-off Date: The date or dates designated as such on the
related
Mortgage Loan Schedule with respect to the related Mortgage Loan
Package.
Deemed Material and Adverse Representation: Each representation
and
warranty identified as such in Section 9.02 of this Agreement.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased or to
be
repurchased or replaced or to be replaced with a Qualified
Substitute Mortgage
Loan by the Seller in accordance with the terms of this
Agreement.
Depositor: The depositor, as such term is defined in Regulation
AB,
with respect to any Securitization Transaction.
Determination Date: The date specified in the Interim Servicing
Agreement (with respect to each Mortgage Loan, for an interim
period, as
specified therein).
Due Date: The day of the month on which the Monthly Payment is
due
on a Mortgage Loan, exclusive of any days of grace.
Escrow Payments: With respect to any Mortgage Loan, the amounts
constituting ground rents, taxes, assessments, water rates, sewer
rents,
municipal charges, mortgage insurance premiums, fire and hazard
insurance
premiums, condominium charges, and any other payments required to
be escrowed
by the Mortgagor with the Mortgagee pursuant to the Mortgage or any
other
document.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Fannie Mae: The Federal National Mortgage Association, or any
successor thereto.
Fannie Mae Guides: The Fannie Mae Sellers' Guide and the Fannie
Mae
Servicers' Guide, as amended or restated from time to time.
Fannie Mae Transfer: As defined in Section 13.
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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.
FIRREA: The Financial Institutions Reform, Recovery, and
Enforcement
Act of 1989, as amended and in effect from time to time.
First Lien Loan: A Mortgage Loan secured by a first lien Mortgage
on
the related Mortgaged Property.
Fixed Rate Mortgage Loan: A fixed rate mortgage loan purchased
pursuant to this Agreement.
Freddie Mac: The Federal Home Loan Mortgage Corporation, or any
successor thereto.
Freddie Mac Transfer: As defined in Section 13.
Gross Margin: With respect to each Adjustable Rate Mortgage
Loan,
the fixed percentage amount set forth in the related Mortgage Note
which
amount is added to the Index in accordance with the terms of the
related
Mortgage Note to determine on each Interest Rate Adjustment Date
the Mortgage
Interest Rate for such Mortgage Loan.
High Cost Loan: A Mortgage Loan (a) covered by the Home
Ownership
and Equity Protection Act of 1994, (b) 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 (c) a
Mortgage Loan
categorized as High Cost pursuant to Appendix E of Standard &
Poor's Glossary.
For avoidance of doubt, the parties agree that this definition
shall apply to
any law regardless of whether such law is presently, or in the
future becomes,
the subject of judicial review or litigation.
Home Loan: A Mortgage Loan categorized as a 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 Mortgage Insurance issued by the
FHA. The
term "HUD," for purposes of this Agreement, is also deemed to
include
subdivisions thereof such as the FHA and Government National
Mortgage
Association.
Index: The index indicated in the related Mortgage Note for
each
Adjustable Rate Mortgage Loan.
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Insurance Proceeds: With respect to each Mortgage Loan, proceeds
of
insurance policies insuring the Mortgage Loan or the related
Mortgaged
Property.
Interest Rate Adjustment Date: With respect to each Adjustable
Rate
Mortgage Loan, the date, specified in the related Mortgage Note and
the
related Mortgage Loan Schedule, on which the Mortgage Interest Rate
is
adjusted.
Interim Funder: With respect to each MERS Designated Mortgage
Loan,
the Person named on the MERS System as the interim funder pursuant
to the MERS
Procedures Manual.
Interim Servicer: The servicer under the Interim Servicing
Agreement, or its successor in interest, or any successor to the
Interim
Servicer under the Interim Servicing Agreement, as therein
provided.
Interim Servicing Agreement: The agreement to be entered into by
the
Purchaser and the Interim Servicer, providing for the Interim
Servicer to
service the Mortgage Loans as specified by the Interim Servicing
Agreement.
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 amount per annum set forth on the related Mortgage
Loan
Schedule.
Liquidation Proceeds: The proceeds received in connection with
the
liquidation of a defaulted Mortgage Loan, whether through the sale
or
assignment of such Mortgage Loan, trustee's sale, foreclosure sale
or
otherwise or the sale of the related Mortgaged Property if the
Mortgaged
Property is acquired in satisfaction of the Mortgage Loan, other
than amounts
received following the acquisition of REO Property, Insurance
Proceeds and
Condemnation Proceeds.
Loan-to-Value Ratio: With respect to any Mortgage Loan, as of
any
date of determination, the ratio (expressed as a percentage) the
numerator of
which is the outstanding principal balance of the Mortgage Loan as
of the
related Cut-off Date (unless otherwise indicated), and the
denominator of
which is 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.
LTV: Loan-to-Value Ratio.
Manufactured Home: A single family residential unit that is
constructed in a factory in sections in accordance with the
Federal
Manufactured Home Construction and Safety Standards adopted on June
15, 1976,
by the Department of Housing and Urban Development
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<PAGE>
("HUD Code"), as amended in 2000, which preempts state and local
building
codes. Each unit is identified by the presence of a HUD
Plate/Compliance
Certificate label. The sections are then transported to the site
and joined
together and affixed to a pre-built permanent foundation (which
satisfies the
manufacturer's requirements and all state, county, and local
building codes
and regulations). The manufactured home is built on a
non-removable, permanent
frame chassis that supports the complete unit of walls, floors, and
roof. The
underneath part of the home may have running gear (wheels, axles,
and brakes)
that enable it to be transported to the permanent site. The wheels
and hitch
are removed prior to anchoring the unit to the permanent
foundation. The
manufactured home must be classified as real estate and taxed
accordingly. The
permanent foundation may be on land owned by the mortgager or may
be on leased
land.
MERS: Mortgage Electronic Registration Systems, Inc., a
Delaware
corporation, and its successors in interest.
MERS Designated Mortgage Loan: Mortgage Loans for which (a) the
Seller has designated or will designate MERS as, and has taken or
will take
such action as is necessary to cause MERS to be, the mortgagee of
record, as
nominee for the Seller, in accordance with MERS Procedures Manual
and (b) the
Seller has designated or will designate the Purchaser as the
Investor on the
MERS System.
MERS Procedures Manual: The MERS Procedures Manual, as it may
be
amended, supplemented or otherwise modified from time to time.
MERS Report: The report from the MERS System listing MERS
Designated
Mortgage Loans and other information.
MERS System: MERS mortgage electronic registry system, as more
particularly described in the MERS Procedures Manual.
Monthly Payment: With respect to any Mortgage Loan, the
scheduled
payment of principal and interest payable by a Mortgagor under the
related
Mortgage Note on each Due Date.
Mortgage: With respect to a Mortgage Loan that is not a Co-op
Loan,
the mortgage, deed of trust or other instrument securing a Mortgage
Note,
which creates a first lien, in the case of a First Lien Loan, or a
second
lien, in the case of a Second Lien Loan, on the related Mortgaged
Property.
With respect to a Co-op Loan, the Security Agreement.
Mortgage File: With respect to any Mortgage Loan, the Mortgage
Loan
Documents and the items listed in Exhibit A-2 hereto and any
additional
documents required to be added to the Mortgage File pursuant to
this
Agreement.
Mortgage Interest Rate: With respect to each Mortgage Loan, the
annual rate at which interest accrues on such Mortgage Loan from
time to time
in accordance with the provisions of the related Mortgage Note.
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.
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Mortgage Loan: Each mortgage loan sold, assigned and
transferred
pursuant to this Agreement and 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: With respect to any Mortgage Loan, the
documents required to be delivered to the Custodian pursuant to
Subsection
6.03.
Mortgage Loan Package: Each pool of Mortgage Loans, which shall
be
purchased by the Purchaser from the Seller from time to time on
each Closing
Date.
Mortgage Loan Schedule: The schedule of Mortgage Loans setting
forth
the following information with respect to each Mortgage Loan in the
related
Mortgage Loan Package: (1) the Seller's Mortgage Loan identifying
number; (2)
the Mortgagor's name; (3) the social security number of the
Mortgagor; (4) a
code indicating whether the Mortgagor's race and/or ethnicity is
(i) native
American or Alaskan native, (ii) Asian/Pacific islander, (iii)
African
American, (iv) white, (v) Hispanic or Latino, (vi) other minority,
(vii) not
provided by the Mortgagor, (viii) not applicable (if the Mortgagor
is an
entity) and (ix) unknown or missing; (5) the street address of the
Mortgaged
Property including the city, state and zip code; (6) a code
indicating whether
the Mortgagor is self-employed; (7) a code indicating whether the
Mortgaged
Property is owner-occupied, investment property or a second home;
(8) a code
indicating the number and type of residential units constituting
the Mortgaged
Property (e.g., single family residence, two-family residence,
three-family
residence, four-family residence, multifamily residence,
condominium,
manufactured housing, mixed-use property, raw land and other non
residential
properties, planned unit development or cooperative stock in a
cooperative
housing corporation); (9) 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; (10)
the LTV or
CLTV, as applicable, at origination; (11) the Mortgage Interest
Rate as of the
related Cut-off Date; (12) 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; (13) the stated maturity date;
(14) the
amount of the Monthly Payment as of the related Cut-off Date; (15)
whether the
Mortgage Loan has Monthly Payments that are interest-only for a
period of
time, and the interest-only period, if applicable (and with respect
to each
Second Lien Loan, whether the related first lien mortgage loan has
monthly
payments that are interest-only for a period of time, and the
interest-only
period, if applicable); (16) the last payment date on which a
payment was
actually applied to the outstanding principal balance; (17) the
schedule of
the payment delinquencies in the prior 12 months; (18) the
Servicing Fee Rate;
(19) the original principal amount of the Mortgage Loan; (20) 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; (21) with respect to each Mortgage
Loan with
a second lien behind it, the combined principal balance of the
Mortgage Loan
and the applicable second lien loan, at origination, (22) a code
indicating
whether there is a simultaneous second; (23) with respect to
Adjustable Rate
Mortgage Loans, the Interest Rate Adjustment Date; (24) with
respect to
Adjustable Rate Mortgage Loans, the Gross Margin; (25) with respect
to
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Adjustable Rate Mortgage Loans, the Lifetime Rate Cap under the
terms of the
Mortgage Note; (26) with respect to Adjustable Rate Mortgage Loans,
a code
indicating the type of Index, including the methodology for
rounding (e.g.,
rounded upward, if necessary, to the nearest ten thousandth
(.0001)) and the
applicable time frame for determining the Index; (27) the product
type of
Mortgage Loan (i.e., Fixed Rate, Adjustable Rate, First Lien Loan
or Second
Lien Loan), and with respect to each Second Lien Loan, the product
type of the
related first lien loan; (28) a code indicating the purpose of the
loan (i.e.,
purchase, Rate/Term Refinance or Cash-Out Refinance); (29) a code
indicating
the documentation style (i.e., no documents, full, alternative,
reduced, no
income/no asset, stated income, no ration, reduced or NIV); (30)
asset
verification (Y/N); (31) the loan credit classification (as
described in the
Underwriting Guidelines); (32) whether such Mortgage Loan provides
for a
Prepayment Penalty; (33) the Prepayment Penalty period of such
Mortgage Loan,
if applicable; (34) a description of the Prepayment Penalty, if
applicable;
(35) the Mortgage Interest Rate as of origination; (36) the credit
risk score
(FICO score); (37) the date of origination; (38) with respect to
Adjustable
Rate Mortgage Loans, the Mortgage Interest Rate adjustment period;
(39) with
respect to Adjustable Rate Mortgage Loans, the Mortgage Interest
Rate
adjustment percentage; (40) with respect to Adjustable Rate
Mortgage Loans,
the Mortgage Interest Rate floor; (41) the Mortgage Interest Rate
calculation
method (i.e., 30/360, simple interest, other); (42) with respect to
Adjustable
Rate Mortgage Loans, the Periodic Rate Cap as of the first Interest
Rate
Adjustment Date; (43) with respect to each Adjustable Rate Mortgage
Loan, a
code indicating whether the Mortgage Loan provides for negative
amortization;
(44) a code indicating whether the Mortgage Loan has negative
amortization and
the maximum of such negative amortization; (45) a code indicating
whether the
Mortgage Loan is a Balloon Mortgage Loan; (46) a code indicating
whether the
Mortgage Loan by its original terms or any modifications thereof
provides for
amortization beyond its scheduled maturity date; (47) the original
Monthly
Payment due; (48) the Appraised Value; (49) appraisal type; (50)
appraisal
date; (51) a code indicating whether the Mortgage Loan is covered
by a PMI
Policy and, if so, identifying the PMI Policy provider; (54) the
certificate
number of the PMI Policy, if applicable; (52) the amount of
coverage of the
PMI Policy, if applicable; (53) in connection with a condominium
unit, a code
indicating whether the condominium project where such unit is
located is
low-rise or high-rise; (54) a code indicating whether the Mortgaged
Property
is a leasehold estate; (55) with respect to the related Mortgagor,
the
debt-to-income ratio; (56) sales price; (57) automated valuation
model (AVM);
(58) a code indicating whether the Mortgage Loan is a MERS
Designated Mortgage
Loan and the MERS Identification Number, if applicable; (59) a
field
indicating whether such Mortgage Loan is a Home Loan; and (60) the
DU or LP
number, if applicable. With respect to the Mortgage Loans in the
aggregate,
the related Mortgage Loan Schedule shall set forth the following
information,
as of the related Cut-off Date: (1) the number of Mortgage Loans;
(2) the
current aggregate 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 original executed note or other evidence of
the
Mortgage Loan indebtedness of a Mortgagor, including any riders or
addenda
thereto.
Mortgaged Property: With respect to a Mortgage Loan that is not
a
Co-op Loan, the Mortgagor's real property securing repayment of a
related
Mortgage Note, consisting of an
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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.
Mortgagee: The mortgagee or beneficiary named in the Mortgage
and
the successors and assigns of such mortgagee or beneficiary.
Mortgagor: The obligor on a Mortgage Note, who is an owner of
the
Mortgaged Property and the grantor or mortgagor named in the
Mortgage and such
grantor's or mortgagor's successors in title to the Mortgaged
Property.
Nonrecoverable Advance: Any advance previously made or proposed
to
be made in respect of a Mortgage Loan which, in the good faith
judgment of the
Interim Servicer, will not or, in the case of a proposed advance,
would not,
be ultimately recoverable from related Insurance Proceeds,
Liquidation
Proceeds or otherwise. The determination by the Interim Servicer
that it has
made a Nonrecoverable Advance or that any proposed advance of
principal and
interest, if made, would constitute a Nonrecoverable Advance, shall
be
evidenced by an Officers' Certificate delivered to the
Purchaser.
Officer's Certificate: A certificate signed by the Chairman of
the
Board or the Vice Chairman of the Board or a President or a Chief
Executive
Officer or a Chief Financial Officer or an Executive 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 the Interim Servicing 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.
Periodic Rate Cap: With respect to each Adjustable Rate
Mortgage
Loan, the provision of each Mortgage Note 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.
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Periodic Rate Floor: With respect to each Adjustable Rate
Mortgage
Loan, the provision of each Mortgage Note which provides for an
absolute
maximum amount by which the Mortgage Interest Rate therein may
decrease on an
Interest Rate Adjustment Date below the Mortgage Interest Rate
previously in
effect.
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 Section 3.
Prepayment Penalty: With respect to each Mortgage Loan, the
amount
of any premium or penalty required to be paid by the Mortgagor 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 thereon, and which is not
accompanied by an
amount of interest representing scheduled interest due on any date
or dates in
any month or months subsequent to the month of prepayment.
Purchase Price: The price paid on the related Closing Date by
the
Purchaser to the Seller in exchange for the Mortgage Loans
purchased on such
Closing Date as calculated in Section 4 of this Agreement.
Purchase Price and Terms Agreement: Each agreement setting forth
the
general terms and conditions of the purchase and sale of the
Mortgage Loans to
be purchased from time to time under this Agreement.
Purchase Price Percentage: The percentage of par (expressed as
a
decimal) set forth in the related Purchase Price and Terms
Agreement.
Purchaser: Morgan Stanley Mortgage Capital Inc., a New York
corporation, and its successors in interest and assigns, or any
successor to
the Purchaser under this Agreement as herein provided.
Qualified Appraiser: An appraiser, duly appointed by the Seller,
who
had no interest, direct or indirect, in the Mortgaged Property or
in any loan
made on the security thereof, and whose compensation was not
affected by the
approval or disapproval of the Mortgage Loan, and such appraiser
and the
appraisal made by such appraiser both satisfied the requirements of
Title XI
of FIRREA 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
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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, be approved by the Purchaser and (i) have an
unpaid
principal balance, after deduction of all scheduled payments due in
the month
of substitution (or in the case of a substitution of more than one
mortgage
loan for a Deleted Mortgage Loan, an aggregate principal balance),
not in
excess of the unpaid principal balance of the Deleted Mortgage Loan
(the
amount of any shortfall will be deposited in the Custodial Account
by the
Seller in the month of substitution); (ii) have a Mortgage Interest
Rate not
less than and not more than one percent (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 (1) 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 Cap and
Index); (v) comply as of the date of substitution with each
representation and
warranty set forth in Section 9 of this Agreement; (vi) be current
in the
payment of principal and interest; (vii) be secured by a Mortgaged
Property of
the same type and occupancy status as secured the Deleted Mortgage
Loan; and
(viii) have payment terms that do not vary in any material respect
from those
of the Deleted Mortgage Loan.
Rate/Term Refinance: A Refinanced Mortgage Loan, in which the
proceeds received were not in excess of the amount of funds
required to repay
the principal balance of any existing first mortgage loan on the
related
Mortgaged Property, pay related closing costs and satisfy any
outstanding
subordinate mortgages on the related Mortgaged Property and did not
provide
incidental cash to the related Mortgagor of more than one percent
(1%) of the
original principal balance of such Mortgage Loan.
Reconstitution: Any Securitization Transaction or a Whole Loan
Transfer.
Reconstitution Agreements: The agreement or agreements entered
into
by the Seller and the Purchaser and/or certain third parties on
the
Reconstitution Date or Dates with respect to any or all of the
Mortgage Loans
sold hereunder, in connection with a Whole Loan Transfer, Agency
Transfer or a
Securitization Transaction pursuant to Section 13, including, but
not limited
to, a seller's warranties and servicing agreement with respect to a
Whole Loan
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Transfer, and a pooling and servicing agreement and/or
seller/servicer
agreements and related custodial/trust agreement and documents with
respect to
a Securitization Transaction.
Reconstitution Date: As defined in Section 13.
Refinanced Mortgage Loan: A Mortgage Loan the proceeds of which
were
not used to purchase the related Mortgaged Property.
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. 1,506,
1,531
(Jan. 7, 2005)) or by the staff of the Commission, or as may be
provided by
the Commission or its staff from time to time.
REMIC: A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.
REMIC Provisions: Provisions of the federal income tax law
relating
to a REMIC, which appear at Section 860A through 860G of Subchapter
M of
Chapter 1, Subtitle A of the Code, and related provisions and
regulations,
rulings or pronouncements promulgated thereunder, as the foregoing
may be in
effect from time to time.
Remittance Date: The date specified in the Interim Servicing
Agreement (with respect to each Mortgage Loan, as specified
therein).
REO Property: A Mortgaged Property acquired by the Interim
Servicer
through foreclosure or deed in lieu of foreclosure.
Repurchase Price: With respect to any Mortgage Loan, a price
equal
to the unpaid principal balance of the Mortgage Loan to be
repurchased, plus
accrued interest thereon at the Mortgage Interest Rate and
including the last
Due Date through which interest had last been paid through the date
of such
repurchase, plus the amount of any outstanding advances owed to any
servicer,
plus all costs and expenses incurred by the Purchaser or any
servicer arising
out of or based upon such breach, including without limitation
costs and
expenses incurred in the enforcement of the Seller's repurchase
obligation
hereunder.
Residential Dwelling: Any one of the following: (i) a detached
one-family dwelling, (ii) a detached two- to four-family dwelling,
(iii) a
one-family dwelling unit in a condominium project or (iv) a
one-family
dwelling in a planned unit development, none of which is a
co-operative,
mobile or Manufactured Home.
RESPA: The Real Estate Settlement Procedures Act, as amended
from
time to time.
Second Lien Loan: A Mortgage Loan secured by a second lien
Mortgage
on the related Mortgaged Property.
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Securities Act: The Securities Act of 1933, as amended.
Securitization Transaction: Any transaction involving either (1)
a
sale or other transfer of some or all of the Mortgage Loans
directly or
indirectly to an issuing entity in connection with an issuance of
publicly
offered or privately placed, rated or unrated mortgage-backed
securities or
(2) an issuance of publicly offered or privately placed, rated or
unrated
securities, the payments on which are determined primarily by
reference to one
or more portfolios of residential mortgage loans consisting, in
whole or in
part, of some or all of the Mortgage Loans.
Security Agreement: The agreement creating a security interest
in
the stock allocated to a dwelling unit in the residential
cooperative housing
corporation that was pledged to secure such Co-op Loan and the
related Co-op
Lease.
Seller: As defined in the initial paragraph of the Agreement,
together with its successors in interest.
Seller Information: As defined in Subsection 34.04(a).
Servicing Fee: With respect to each Mortgage Loan subject to
the
Interim 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 Interim Servicer under the Interim 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 Interim
Servicer, or as otherwise provided under this Agreement.
Servicing Fee Rate: An amount per annum as set forth in the
Interim
Servicing Agreement.
Servicing File: With respect to each Mortgage Loan, the file
retained by the Interim Servicer consisting of originals of all
documents in
the Mortgage File which are not delivered to the Purchaser or the
Custodian
and copies of the Mortgage Loan Documents set forth in Section 2 of
the
Custodial Agreement.
Servicing Rights: Any and all of the following: (a) any and all
rights to service the Mortgage Loans; (b) any payments to or monies
received
by the Seller for servicing the Mortgage Loans; (c) any late fees,
penalties
or similar payments with respect to the Mortgage Loans; (d) all
agreements or
documents creating, defining or evidencing any such servicing
rights to the
extent they relate to such servicing rights and all rights of the
Seller
thereunder; (e) Escrow Payments or other similar payments with
respect to the
Mortgage Loans and any amounts actually collected by the Seller
with respect
thereto; (f) all accounts and other rights to payment related to
any of the
property described in this paragraph; and (g) any and all
documents, files,
records, servicing files, servicing documents, servicing records,
data tapes,
computer records, or other information pertaining to the Mortgage
Loans or
pertaining to the past, present or prospective servicing of the
Mortgage
Loans.
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<PAGE>
Sponsor: The sponsor, as such term is defined in Regulation AB,
with
respect to any Securitization Transaction.
Standard & Poor's: Standard & Poor's Ratings Services, a
division of
The McGraw-Hill Companies Inc., and any successor thereto.
Standard & Poor's Glossary: The Standard & Poor's
LEVELS(R)
Glossary, as may be in effect from time to time.
Stated Principal Balance: As to each Mortgage Loan on any date
of
determination, (i) the principal balance of such Mortgage Loan at
the related
Cut-off Date after giving effect to payments of principal due on or
before
such date, to the extent actually received, minus (ii) all amounts
previously
distributed to the Purchaser with respect to the related Mortgage
Loan
representing payments or recoveries of principal on such Mortgage
Loan.
Static Pool Information: Static pool information as described
in
Item 1105(a)(1)-(3) and 1105(c) of Regulation AB.
Successor Servicer: Any servicer of one or more Mortgage Loans
designated by the Purchaser as being entitled to the benefits of
the
indemnifications set forth in Subsections 9.03 and 14.01.
Third-Party Originator: Each Person, other than a Qualified
Correspondent, that originated Mortgage Loans acquired by the
Seller.
Transfer Date: In the event the Interim Servicer is terminated
as
servicer of a Mortgage Loan pursuant to the Interim Servicing
Agreement, the
date on which the Purchaser, or its designee, shall receive the
transfer of
servicing responsibilities and begin to perform the servicing of
such Mortgage
Loans, and the Interim Servicer shall cease all servicing
responsibilities.
Underwriting Guidelines: The underwriting guidelines of the
Seller,
a copy of which is attached hereto as Exhibit G and a then-current
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.
SECTION 2. Agreement to Purchase.
The Seller agrees to sell from time to time, and the Purchaser
agrees to purchase from time to time, Mortgage Loans having an
aggregate
actual unpaid principal balance on the related Cut-off Date in an
amount as
set forth in the related Purchase Price and Terms Agreement, or in
such other
amount as agreed by the Purchaser and the Seller as evidenced by
the actual
aggregate unpaid principal balance of the Mortgage Loans accepted
by the
Purchaser on each Closing Date, together with the related Mortgage
Files and
all rights and obligations arising under the documents contained
therein.
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<PAGE>
SECTION 3.
Mortgage Schedules.
The Seller from time to time shall provide the Purchaser with
certain information constituting a preliminary listing of the
Mortgage Loans
to be purchased on each Closing Date in accordance with the related
Purchase
Price and Terms Agreement and this Agreement (each, a "Preliminary
Mortgage
Schedule").
The Seller shall deliver the related Mortgage Loan Schedule for
the
Mortgage Loans to be purchased on a particular Closing Date to the
Purchaser
at least five (5) Business Days prior to the related Closing Date.
The related
Mortgage Loan Schedule shall be the related Preliminary Mortgage
Schedule with
those Mortgage Loans which have not been funded prior to the
related Closing
Date deleted.
SECTION 4. Purchase Price.
The Purchase Price for each Mortgage Loan and the related
Servicing
Rights shall be the percentage of par as stated in the related
Purchase Price
and Terms Agreement (subject to adjustment as provided therein),
multiplied by
the aggregate actual unpaid principal balance, as of the related
Cut-off Date,
of the Mortgage Loans listed on the related Mortgage Loan Schedule,
after
application of scheduled payments of principal due on or before the
related
Cut-off Date, but only to the extent such payments were actually
received. The
initial principal amount of the related Mortgage Loans shall be the
aggregate
actual unpaid principal balance of the Mortgage Loans, so computed
as of the
related Cut-off Date. If so provided in the related Purchase Price
and Terms
Agreement, portions of the Mortgage Loans and/or the Servicing
Rights shall be
priced and paid for separately.
In addition to the Purchase Price as described above, the
Purchaser
shall pay to the Seller, at closing, accrued interest from the last
"interest
paid to" date through the day immediately preceding the related
Closing Date,
inclusive, on the aggregate actual unpaid principal amount of the
related
Mortgage Loans as of the related Cut-off Date at the weighted
average Mortgage
Interest Rate of those Mortgage Loans. The Purchase Price plus
accrued
interest as set forth in the preceding paragraph shall be paid to
the Seller
by wire transfer of immediately available funds to an account
designated by
the Seller in writing.
The Purchaser shall be entitled to (1) all scheduled principal
due
after the related Cut-off Date, (2) all other recoveries of
principal
collected on or after the related Cut-off Date, and (3) all
payments of
interest on the Mortgage Loans net of applicable Servicing Fees
(minus that
portion of any such payment which is allocable to the period prior
to the
related Cut-off Date). The outstanding principal balance of each
Mortgage Loan
as of the related Cut-off Date is determined after application of
payments of
principal due on or before the related Cut-off Date, to the extent
actually
collected, together with any unscheduled principal prepayments
collected prior
to such Cut-off Date; provided, however, that payments of scheduled
principal
and interest paid prior to such Cut-off date, but to be applied on
a Due Date
beyond the related Cut-off Date shall not be applied to the
principal balance
as of the related Cut-off Date. Such prepaid amounts shall be the
property of
the Purchaser. The Seller shall deposit any such prepaid amounts
into the
Custodial Account, which account is established for the benefit of
the
Purchaser for subsequent remittance by the Seller to the
Purchaser.
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<PAGE>
SECTION 5. Examination of Mortgage Files.
At least ten (10) Business Days prior to the related Closing
Date,
the Seller shall either (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 of the
Mortgage
Files 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 do not conform to any of the
requirements
set forth in the related Purchase Price and Terms Agreement, or as
an Exhibit
annexed thereto, the Purchaser may delete such Mortgage Loans from
the related
Mortgage Loan Schedule, and such Deleted Mortgage Loan (or Loans)
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 impair in any way the Purchaser's (or any
of its
successor's) rights to demand repurchase, substitution or other
relief as
provided in this Agreement. In the event that the Seller fails to
deliver the
Mortgage File with respect to any Mortgage Loan, the Seller shall,
upon the
request of the Purchaser, repurchase such Mortgage Loan as the
price and in
the manner specified in Subsection 9.03.
SECTION 6. Conveyance from Seller to Purchaser.
Subsection 6.01 Conveyance of Mortgage Loans.
The Seller, simultaneously with the delivery of the Mortgage
Loan
Schedule with respect to the related Mortgage Loan Package to be
purchased on
each Closing Date, shall execute and deliver an Assignment and
Conveyance
Agreement in the form attached hereto as Exhibit H (the "Assignment
and
Conveyance Agreement"). The Seller shall ensure that the contents
of each
Servicing File, which are required to be retained by or delivered
to the
Interim Servicer to service the Mortgage Loans pursuant to the
Interim
Servicing Agreement and thus not delivered to the Purchaser, or its
designee,
are and shall be held in trust by the Interim Servicer for the
benefit of the
Purchaser as the owner thereof. The Seller agrees that the Interim
Servicer's
possession of any portion of each such Mortgage File is at the will
of the
Purchaser for the sole purpose of facilitating servicing of the
Mortgage Loans
pursuant to this Agreement, and such retention and possession by
the Interim
Servicer shall be in a custodial capacity only. The ownership of
each Mortgage
Note, each Mortgage and the contents of each Mortgage File is
vested in the
Purchaser and the ownership of all records and documents with
respect to the
related Mortgage Loan prepared by or which come into the possession
of the
Interim Servicer shall immediately vest in the Purchaser and shall
be retained
and maintained, in trust, by the Interim Servicer at the will of
the Purchaser
in such custodial capacity only. The Seller shall cause the
Servicing File
retained by the Interim Servicer pursuant to this Agreement to
be
appropriately identified in the Seller's computer system and/or
books and
records, as appropriate, to clearly reflect the sale of the related
Mortgage
Loan to the Purchaser. The Seller shall cause the Interim Servicer
to release
from its custody the contents of any Servicing File retained by
it
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only in accordance with this Agreement or the Interim Servicing
Agreement,
except when such release is required in connection with a
repurchase of any
such Mortgage Loan pursuant to Subsection 9.03 or if required under
applicable
law or court order.
Subsection 6.02 Books and Records.
Record title to each Mortgage and the related Mortgage Note as
of
the related Closing Date shall be in the name of the Seller, an
Affiliate of
the Seller, the Purchaser or one or more designees of the
Purchaser, as the
Purchaser shall select; provided, however, that if a Mortgage has
been
recorded in the name of MERS or its designee, the Seller is shown
as the owner
of the related Mortgage Loan on the records of MERS for purposes of
the system
of recording transfers of beneficial ownership of mortgages
maintained by
MERS. Notwithstanding the foregoing, ownership of each Mortgage and
related
Mortgage Note shall be vested solely in 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 Interim 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 Interim 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 Interim 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 Interim 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 Interim Servicer may be
in the form
of microfilm or microfiche so long as the Seller or the Interim
Servicer
complies with the requirements of the Fannie Mae Guides.
It is the express intention of the parties that the
transactions
contemplated by this Agreement be, and be construed as, a sale of
the related
Mortgage Loans by the Seller and not a pledge of such Mortgage
Loans by the
Seller to the Purchaser to secure a debt or other obligation of the
Seller.
Consequently, the sale of each Mortgage Loan shall be reflected as
a purchase
on the Purchaser's business records, tax returns and financial
statements, and
as a sale of assets on the Seller's business records, tax returns
and
financial statements.
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Subsection 6.03 Delivery of Mortgage Loan Documents.
The Seller shall deliver and release to the Custodian no later
than
two (2) Business Days prior to the related Closing Date those
Mortgage Loan
Documents set forth on Exhibit A-1 hereto as required by the
Custodial
Agreement with respect to each Mortgage Loan set forth on the
related Mortgage
Loan Schedule.
In connection with the foregoing, the Seller shall indemnify
the
Purchaser and its present and former directors, officers, employees
and agents
and any Successor Servicer and its present and former directors,
officers,
employees and agents, and hold such parties harmless against any
losses,
damages, penalties, fines, forfeitures, legal fees and expenses and
related
costs, judgments, and other costs and expenses based on or grounded
upon, or
resulting from, the fact that any Mortgage Loan is not covered by
an ALTA or
CLTA lender's title insurance policy. For purposes of the previous
sentence,
"Purchaser" shall mean the Person then acting as the Purchaser
under this
Agreement and any and all Persons who previously were "Purchasers"
under this
Agreement and "Successor Servicer" shall mean any Person designated
as the
Successor Servicer pursuant to this Agreement and any and all
Persons who
previously were "Successor Servicers" pursuant to this
Agreement.
The Custodian shall certify its receipt of all such Mortgage
Loan
Documents required to be delivered pursuant to the Custodial
Agreement for the
related Closing Date, as evidenced by the Initial Certification of
the
Custodian in the form annexed to the Custodial Agreement. The
Seller shall
comply with the terms of the Custodial Agreement and the Purchaser
shall pay
all fees and expenses of the Custodian.
The Seller shall or shall cause the Interim Servicer to forward
to
the Custodian, or to such other Person as the Purchaser shall
designate in
writing, original documents evidencing an assumption,
modification,
consolidation or extension of any Mortgage Loan entered into in
accordance
with this Agreement within two weeks of their execution, provided,
however,
that the Seller shall provide the Custodian, or to such other
Person as the
Purchaser shall designate in writing, with a certified true copy of
any such
document submitted for recordation within two weeks of its
execution, and
shall promptly provide the original of any document submitted for
recordation
or a copy of such document certified by the appropriate public
recording
office to be a true and complete copy of the original within two
(2) weeks
following receipt of the original document by the Interim Servicer;
provided,
however, that such original recorded document or certified copy
thereof shall
be delivered to the Purchaser no later than 180 days following the
related
Closing Date, unless there has been a delay at the applicable
recording
office.
If the original or copy of any document submitted for recordation
to
the appropriate public recording office is not delivered to the
Purchaser or
its designee within 180 days following the related Closing Date,
the related
Mortgage Loan shall, upon the request of the Purchaser, be
repurchased by the
Seller at the price and in the manner specified in Subsection 9.03.
The
foregoing repurchase obligation shall not apply if the Seller
cannot cause the
Interim Servicer to deliver such original or copy of any 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 (i) the Seller shall instead
deliver a
recording receipt of such recording office or, if such recording
receipt is
not available, an
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officer's certificate of a servicing officer of the Seller,
confirming that
such document has been accepted for recording, and (ii) such
document is
delivered within twelve (12) months of the related Closing
Date.
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.
Subsection 6.04 Quality Control Procedures.
The Seller
shall, or shall cause the Interim 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 Interim Servicer. The program is to
ensure that
the Mortgage Loans are originated in accordance with the
Underwriting
Guidelines; guard against dishonest, fraudulent, or negligent acts;
and guard
against errors and omissions by officers, employees, or other
authorized
persons.
Subsection 6.05 MERS Designated Loans.
With respect to each MERS Designated Mortgage Loan, the Seller
shall, 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.
SECTION 7. Servicing of the Mortgage Loans.
The Mortgage Loans have been sold by the Seller to the Purchaser
on
a servicing released basis. Subject to and upon the terms and
conditions of
this Agreement and the Interim Servicing Agreement (with respect to
each
Mortgage Loan, for an interim period, as specified therein), the
Seller hereby
sells, transfers, assigns, conveys and delivers to the Purchaser
the Servicing
Rights.
The Purchaser shall retain the Interim Servicer as contract
servicer
of the Mortgage Loans for an interim period pursuant to and in
accordance with
the terms and conditions contained in the Interim Servicing
Agreement (with
respect to each Mortgage Loan, for an interim period, as specified
therein).
The Seller shall cause the Interim Servicer to execute the Interim
Servicing
Agreement on the initial Closing Date.
The Seller shall cause the Interim Servicer to transfer the
servicing of the Mortgage Loans on each Transfer Date in accordance
with the
terms of the Interim Servicing Agreement.
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SECTION 8. [RESERVED].
SECTION 9. Representations, Warranties and Covenants of the
Seller;
Remedies for Breach.
Subsection 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 New York
corporation, validly existing, and in good standing under the laws
of its
jurisdiction of incorporation or formation and has all licenses
necessary to
carry on its business as now being conducted and is licensed,
qualified and in
good standing in the states where the Mortgaged Property is located
if the
laws of such state require licensing or qualification in order to
conduct
business of the type conducted by the Seller. The Seller has
corporate power
and authority to execute and deliver this Agreement and to perform
its
obligations hereunder; the execution, delivery and performance of
this
Agreement (including all instruments of transfer to be delivered
pursuant to
this Agreement) by the Seller and the consummation of the
transactions
contemplated hereby have been duly and validly authorized; this
Agreement has
been duly executed and delivered and constitutes the valid, legal,
binding and
enforceable obligation of the Seller, except as enforceability may
be limited
by (i) bankruptcy, insolvency, liquidation, receivership,
moratorium,
reorganization or other similar laws affecting the enforcement of
the rights
of creditors and (ii) general principles of equity, whether
enforcement is
sought in a proceeding in equity or at law. All requisite corporate
action has
been taken by the Seller to make this Agreement valid and binding
upon the
Seller in accordance with its terms;
(b) No Consent Required. No consent, approval, authorization or
order is required for the transactions contemplated by this
Agreement from any
court, governmental agency or body, or federal or state regulatory
authority
having jurisdiction over the Seller is required or, if required,
such consent,
approval, authorization or order has been or will, prior to the
related
Closing Date, be obtained;
(c) Ordinary Course of
Business. The consummation of the
transactions contemplated by this Agreement are in the ordinary
course of
business of the Seller, and the transfer, assignment and conveyance
of the
Mortgage Notes and the Mortgages by the Seller pursuant to this
Agreement are
not subject to the bulk transfer or any similar statutory
provisions in effect
in any applicable jurisdiction;
(d) No Conflicts. Neither the execution and delivery of this
Agreement, the acquisition or origination of the Mortgage Loans by
the Seller,
the sale of the Mortgage Loans to the Purchaser, the consummation
of the
transactions contemplated hereby, nor the fulfillment of or
compliance with
the terms and conditions of this Agreement, will conflict with or
result in a
breach of any of the terms, conditions or provisions of the
Seller's charter
or by-laws or any legal restriction or any agreement or instrument
to which
the Seller is now a party or by which it is bound, or constitute a
default or
result in an acceleration under any of the foregoing, or result in
the
violation of any law, rule, regulation, order, judgment or decree
to which the
Seller or its
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property is subject, or result in the creation or imposition of any
lien,
charge or encumbrance that would have an adverse effect upon any of
its
properties pursuant to the terms of any mortgage, contract, deed of
trust or
other instrument, or impair the ability of the Purchaser to realize
on the
Mortgage Loans, impair the value of the Mortgage Loans, or impair
the ability
of the Purchaser to realize the full amount of any insurance
benefits accruing
pursuant to this Agreement;
(e) No Litigation Pending. There is no action, suit, proceeding
or
investigation pending or, to the knowledge of the Seller,
threatened against
the Seller, before any court, administrative agency or other
tribunal
asserting the invalidity of this Agreement, seeking to prevent
the
consummation of any of the transactions contemplated by this
Agreement or
which, either in any one instance or in the aggregate, may result
in any
material adverse change in the business, operations, financial
condition,
properties or assets of the Seller, or in any material impairment
of the right
or ability of the Seller to carry on its business substantially as
now
conducted, or in any material liability on the part of the Seller,
or which
would draw into question the validity of this Agreement or the
Mortgage Loans
or of any action taken or to be taken in connection with the
obligations of
the Seller contemplated herein, or which would be likely to impair
materially
the ability of the Seller to perform under the terms of this
Agreement;
(f) Ability to Perform; Solvency. The Seller does not believe,
nor
does it have any reason or cause to believe, that it cannot perform
each and
every covenant contained in this Agreement. The Seller is solvent
and the sale
of the Mortgage Loans will not cause the Seller to become
insolvent. The sale
of the Mortgage Loans is not undertaken with the intent to hinder,
delay or
defraud any of Seller's creditors;
(g) Seller's Origination. The Seller's decision to originate
any
mortgage loan or to deny any mortgage loan application is an
independent
decision based upon the Underwriting Guidelines, and is in no way
made as a
result of Purchaser's decision to purchase, or not to purchase, or
the price
Purchaser may offer to pay for, any such mortgage loan, if
originated;
(h) Anti-Money Laundering Laws. The Seller has complied with
all
applicable anti-money laundering laws, executive orders and
regulations,
including without limitation the USA Patriot Act of 2001
(collectively, the
"Anti-Money Laundering Laws"); the Seller has established an
anti-money
laundering compliance program as required by the Anti-Money
Laundering Laws,
has conducted the requisite due diligence in connection with the
origination
of each Mortgage Loan for purposes of the Anti-Money Laundering
Laws,
including with respect to the legitimacy of the applicable
Mortgagor and the
origin of the assets used by the said Mortgagor to purchase the
property in
question, and maintains, and will maintain, sufficient information
to identify
the applicable Mortgagor for purposes of the Anti-Money Laundering
Laws;
(i) Financial Statements. The Seller has delivered to the
Purchaser
financial statements as to its last three complete fiscal years and
any later
quarter ended more than 60 days prior to the execution of this
Agreement. All
such financial statements fairly present, in all material respects,
the
pertinent results of operations and changes in financial position
for each of
such periods and the financial position at the end of each such
period of the
Seller and its subsidiaries and have been prepared in accordance
with
generally accepted accounting principles
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consistently applied throughout the periods involved, except as set
forth in
the notes thereto. In addition, the Seller has delivered
information as to its
loan gain and loss experience in respect of foreclosures and its
loan
delinquency experience for the immediately preceding three-year
period, in
each case with respect to mortgage loans owned by it and such
mortgage loans
serviced for others during such period, and all such information so
delivered
shall be true and correct in all material respects. There has been
no change
in the business, operations, financial condition, properties or
assets of the
Seller since the date of the Seller's financial statements that
would have a
material adverse effect on its ability to perform its obligations
under this
Agreement. The Seller has completed any forms requested by the
Purchaser in a
timely manner and in accordance with the provided instructions;
(j) Selection Process. The Mortgage Loans were selected from
among
the outstanding one- to four-family mortgage loans in the Seller's
portfolio
at the related Closing Date as to which the representations and
warranties set
forth in Subsection 9.02 could be made and such selection was not
made in a
manner so as to affect adversely the interests of the
Purchaser;
(k) Mortgage Loan Characteristics. The characteristics of the
related Mortgage Loan Package are as set forth on the description
of the pool
characteristics for the applicable Mortgage Loan Package delivered
pursuant to
Section 11 on the related Closing Date in the form attached as
Exhibit B to
each related Assignment and Conveyance Agreement;
(l) 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,
in light of
the circumstances in which it was made, not misleading;
(m) 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;
(n) Sale Treatment. The Seller expects to be advised by its
independent certified public accountants that under generally
accepted
accounting principles the transfer of the Mortgage Loans will be
treated as a
sale on the books and records of the Seller and the Seller has
determined that
the disposition of the Mortgage Loans pursuant to this Agreement
will be
afforded sale treatment for tax and accounting purposes; and
(o) 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.
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Subsection 9.02 Representations and Warranties Regarding
Individual
Mortgage Loans.
The Seller hereby represents and warrants to the Purchaser that,
as
to each Mortgage Loan, as of the related Closing Date for such
Mortgage Loan:
(a) Mortgage Loans as Described. The information set forth in
the
related Mortgage Loan Schedule is complete, true and correct;
(b) Payments Current. All payments required to be made up to
the
related Closing Date for the Mortgage Loan under the terms of the
Mortgage
Note have been made and credited. No payment required under the
Mortgage Loan
is 30 days or more delinquent nor has any payment under the
Mortgage Loan been
30 days or more delinquent at any time since the origination of the
Mortgage
Loan;
(c) No Outstanding Charges. There are no defaults in complying
with
the terms of the Mortgage, and all taxes, governmental assessments,
insurance
premiums, water, sewer and municipal charges, leasehold payments or
ground
rents which previously became due and owing have been paid, or an
escrow of
funds has been established in an amount sufficient to pay for every
such item
which remains unpaid and which has been assessed but is not yet due
and
payable. The Seller has not advanced funds, or induced, solicited
or knowingly
received any advance of funds by a party other than the Mortgagor,
directly or
indirectly, for the payment of any amount required under the
Mortgage Loan,
except for interest accruing from the date of the Mortgage Note or
date of
disbursement of the Mortgage Loan proceeds, whichever is earlier,
to the day
which precedes by one month the related Due Date of the first
installment of
principal and interest;
(d) Original Terms Unmodified. The terms of the Mortgage Note
and
Mortgage have not been impaired, waived, altered or modified in any
respect,
from the date of origination except by a written instrument which
has been
recorded, if necessary to protect the interests of the Purchaser,
and which
has been delivered to the Custodian or to such other Person as the
Purchaser
shall designate in writing, and the terms of which are reflected in
the
related Mortgage Loan Schedule. The substance of any such waiver,
alteration
or modification has been approved by the issuer of any related PMI
Policy and
the title insurer, if any, to the extent required by the policy,
and its terms
are reflected on the related Mortgage Loan Schedule, if applicable.
No
Mortgagor has been released, in whole or in part, except in
connection with an
assumption agreement, approved by the issuer of any related PMI
Policy and the
title insurer, to the extent required by the policy, and which
assumption
agreement is part of the Mortgage Loan File delivered to the
Custodian or to
such other Person as the Purchaser shall designate in writing and
the terms of
which are reflected in the related Mortgage Loan Schedule;
(e) No Defenses. The Mortgage Loan is not subject to any right
of
rescission, set-off, counterclaim or defense, including without
limitation the
defense of usury, nor will the operation of any of the terms of the
Mortgage
Note or the Mortgage, or the exercise of any right thereunder,
render either
the Mortgage Note or the Mortgage unenforceable, in whole or in
part, or
subject to any right of rescission, set-off, counterclaim or
defense,
including without limitation
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the defense of usury, and no such right of rescission, set-off,
counterclaim
or defense has been asserted with respect thereto;
(f) Hazard Insurance. Pursuant to the terms of the Mortgage,
all
buildings or other improvements upon the Mortgaged Property are
insured by a
generally acceptable insurer against loss by fire, hazards of
extended
coverage and such other hazards as are provided for in the
Underwriting
Guidelines. If required by the National Flood Insurance Act of
1968, as
amended, 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 with the Underwriting
Guidelines. All
individual insurance policies contain a standard mortgagee clause
naming the
Seller and its successors and assigns as mortgagee, and all
premiums thereon
have been paid. The Mortgage obligates the Mortgagor thereunder to
maintain
the hazard insurance policy at the Mortgagor's cost and expense,
and on the
Mortgagor's failure to do so, authorizes the holder of the Mortgage
to obtain
and maintain such insurance at such Mortgagor's cost and expense,
and to seek
reimbursement therefor from the Mortgagor. Where required by state
law or
regulation, the Mortgagor has been given an opportunity to choose
the carrier
of the required hazard insurance, provided the policy is not a
"master" or
"blanket" hazard insurance policy covering a condominium, or any
hazard
insurance policy covering the common facilities of a planned unit
development.
The hazard insurance policy is the valid and binding obligation of
the
insurer, is in full force and effect, and will be in full force and
effect and
inure to the benefit of the Purchaser upon the consummation of
the
transactions contemplated by this Agreement. The Seller has not
engaged in,
and has no knowledge (based upon reasonable and diligent inquiry)
of the
Mortgagor's having engaged in, any act or omission which would
impair the
coverage of any such policy, the benefits of the endorsement
provided for
herein, or the validity and binding effect of either including,
without
limitation, no unlawful fee, commission, kickback or other
unlawful
compensation or value of any kind has been or will be received,
retained or
realized by any attorney, firm or other person or entity, and no
such unlawful
items have been received, retained or realized by the Seller;
(g) Compliance with Applicable Laws. Any and all requirements of
any
federal, state or local law including, without limitation,
usury,
truth-in-lending, real estate settlement procedures, consumer
credit
protection, predatory and abusive lending, equal credit opportunity
and
disclosure laws applicable to the Mortgage Loan, including,
without
limitation, any provisions relating to a Prepayment Penalty have
been complied
with, the consummation of the transactions contemplated hereby will
not
involve the violation of any such laws or regulations, and the
Seller shall
maintain in its possession, available for the Purchaser's
inspection, and
shall deliver to the Purchaser upon demand, evidence of compliance
with all
such requirements. This representation and warranty is a Deemed
Material and
Adverse Representation;
(h) No Satisfaction of Mortgage. The Mortgage has not been
satisfied, canceled, subordinated or rescinded, in whole or in
part, and the
Mortgaged Property has not been released from the lien of the
Mortgage, in
whole or in part, nor has any instrument been executed that would
effect any
such release, cancellation, subordination or rescission. The Seller
has not
waived the performance by the Mortgagor of any action, if the
Mortgagor's
failure to perform such action would cause the Mortgage Loan to be
in default,
nor has the Seller waived any default resulting from any action or
inaction by
the Mortgagor;
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<PAGE>
(i) Type of Mortgaged Property. With respect to a Mortgage Loan
that
is not a Co-op Loan and is not secured by an interest in a
leasehold estate,
the Mortgaged Property is a fee simple estate that consists of a
single parcel
of real property with a detached single family residence erected
thereon, or a
two- to four-family dwelling, or an individual residential
condominium unit in
a condominium project, or an individual unit in a planned unit
development
(or, with respect to each Co-op Loan, an individual unit in a
residential
cooperative housing corporation); provided, however, that any
condominium
unit, planned unit development or residential cooperative housing
corporation
shall conform with the Underwriting Guidelines. No portion of the
Mortgaged
Property (or underlying Mortgaged Property, in the case of a Co-op
Loan) is
used for commercial purposes, and since the date of origination, no
portion of
the Mortgaged Property has been used for commercial purposes;
provided, that
Mortgaged Properties which contain a home office shall not be
considered as
being used for commercial purposes as long as the Mortgaged
Property has not
been altered for commercial purposes and is not storing any
chemicals or raw
materials other than those commonly used for homeowner repair,
maintenance
and/or household purposes. None of the Mortgaged Properties are
Manufactured
Homes, log homes, mobile homes, geodesic domes or other unique
property types.
This representation and warranty is a Deemed Material and
Adverse
Representation;;
(j) Valid First or Second Lien. The Mortgage is a valid,
subsisting,
enforceable and perfected, first lien (with respect to a First Lien
Loan) or
second lien (with respect to a Second Lien Loan) on the Mortgaged
Property,
including all buildings and improvements on the Mortgaged Property
and all
installations and mechanical, electrical, plumbing, heating and
air
conditioning systems located in or annexed to such buildings, and
all
additions, alterations and replacements made at any time with
respect to the
foregoing. The lien of the Mortgage is subject only to:
(i) with respect
to a Second Lien Loan only, the lien
of the first mortgage on the Mortgaged Property;
(ii) the lien of
current real property taxes and
assessments not yet due and payable;
(iii) covenants, conditions and restrictions, rights of
way, easements and other matters of the public
record as of the date of recording acceptable to
prudent mortgage lending institutions generally and
specifically referred to in the lender's title
insurance policy delivered to the originator of the
Mortgage Loan and (A) specifically referred to or
otherwise considered in the appraisal made for the
originator of the Mortgage Loan or (B) which do not
adversely
affect the Appraised Value 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.
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Any security agreement, chattel mortgage or equivalent document
related to and delivered in connection with the Mortgage Loan
establishes and
creates a valid, subsisting, enforceable and perfected first lien
(with
respect to a First Lien Loan) or second lien (with respect to a
Second Lien
Loan) and first priority (with respect to a First Lien Loan) or
second
priority (with respect to a Second Lien Loan) security interest on
the
property described therein and the Seller has full right to sell
and assign
the same to the Purchaser.
With respect to any Co-op Loan, the related Mortgage is a
valid,
subsisting and enforceable first priority security interest on the
related
cooperative shares securing the Mortgage Note, subject only to (a)
liens of
the related residential cooperative housing corporation for unpaid
assessments
representing the Mortgagor's pro rata share of the related
residential
cooperative housing corporation's payments for its blanket
mortgage, current
and future real property taxes, insurance premiums, maintenance
fees and other
assessments to which like collateral is commonly subject and (b)
other matters
to which like collateral is commonly subject which do not
materially interfere
with the benefits of the security interest intended to be provided
by the
related Security Agreement;
(k) Validity of Mortgage Documents. The Mortgage Note and the
Mortgage and any other agreement executed and delivered by a
Mortgagor in
connection with a Mortgage Loan are genuine, and each is the legal,
valid and
binding obligation of the maker thereof enforceable in accordance
with its
terms (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. The documents,
instruments
and agreements submitted for loan underwriting were not falsified
and contain
no untrue statement of material fact or omit to state a material
fact required
to be stated therein or necessary to make the information and
statements
therein not misleading. No fraud, error, omission,
misrepresentation,
negligence or similar occurrence with respect to a Mortgage Loan
has taken
place on the part of any Person, including without limitation, the
Mortgagor,
any appraiser, any builder or developer, or any other party
involved in the
origination of the Mortgage Loan or in the application for any
insurance in
relation to such Mortgage Loan. The Seller has reviewed all of the
documents
constituting the Servicing File and has made such inquiries as it
deems
necessary to make and confirm the accuracy of the representations
set forth
herein;
(l) Full Disbursement of Proceeds. The Mortgage Loan has been
closed
and the proceeds of the Mortgage Loan have been fully disbursed and
there is
no requirement for future advances thereunder, and any and all
requirements as
to completion of any on-site or off-site improvement and as to
disbursements
of any escrow funds therefor have been complied with. All costs,
fees and
expenses incurred in making or closing the Mortgage Loan and the
recording of
the Mortgage were paid, and the Mortgagor is not entitled to any
refund of any
amounts paid or due under the Mortgage Note or Mortgage;
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(m) Ownership. The Seller is the sole owner of record and holder
of
the Mortgage Loan and the indebtedness evidenced by each Mortgage
Note and
upon the sale of the Mortgage Loans to the Purchaser, the Seller
will retain
the Mortgage Files or any part thereof with respect thereto not
delivered to
the Custodian, the Purchaser or the Purchaser's designee, in trust
only for
the purpose of servicing and supervising the servicing of each
Mortgage Loan.
The Mortgage Loan is not assigned or pledged, and the Seller has
good,
indefeasible and marketable title thereto, and has full right to
transfer and
sell the Mortgage Loan to the Purchaser free and clear of any
encumbrance,
equity, participation interest, lien, pledge, charge, claim or
security
interest, and has full right and authority subject to no interest
or
participation of, or agreement with, any other party, to sell and
assign each
Mortgage Loan pursuant to this Agreement and following the sale of
each
Mortgage Loan, such Mortgage Loan will be free and clear of any
encumbrance,
equity, participation interest, lien, pledge, charge, claim or
security
interest. The Seller intends to relinquish all rights to possess,
control and
monitor the Mortgage Loan, except as may be required of the Seller
in its
Mortgage capacity as Servicer of such Mortgage Loan. After the
related Closing
Date, the Seller will have no right to modify or alter the terms of
the sale
of the Mortgage Loan and the Seller will have no obligation or
right to
repurchase the Mortgage Loan or substitute another Mortgage Loan,
except as
provided in this Agreement;
(n) Doing Business. All parties which have had any interest in
the
Mortgage Loan, whether as mortgagee, assignee, pledgee or
otherwise, are (or,
during the period in which they held and disposed of such interest,
were) (1)
in compliance with any and all applicable licensing requirements of
the laws
of the state wherein the Mortgaged Property is located, and (2)
either (i)
organized under the laws of such state, or (ii) qualified to do
business in
such state, or (iii) a federal savings and loan association, a
savings bank or
a national bank having a principal office in such state, or (3) not
doing
business in such state;
(o) CLTV, LTV and PMI Policy. No Mortgage Loan that is a Second
Lien
Loan has a CLTV greater than 100%. No Mortgage Loan has an LTV
greater than
100%. Any Mortgage Loan that had at the time of origination an LTV
in excess
of 80% is insured as to payment defaults by a PMI Policy. Any PMI
Policy in
effect covers the related Mortgage Loan for the life of such
Mortgage Loan.
All provisions of such PMI Policy have been and are being complied
with, such
policy is in full force and effect, and all premiums due thereunder
have been
paid. No action, inaction, or event has occurred and no state of
facts exists
that has, or will result in the exclusion from, denial of, or
defense to
coverage. Any Mortgage Loan subject to a PMI Policy obligates the
Mortgagor
thereunder to maintain the PMI Policy and to pay all premiums and
charges in
connection therewith. The Mortgage Interest Rate for the Mortgage
Loan as set
forth on the related Mortgage Loan Schedule is net of any such
insurance
premium if the related PMI Policy is lender-paid;
(p) Title Insurance. With respect to a Mortgage Loan which is not
a
Co-op Loan, the Mortgage Loan is covered by an ALTA lender's title
insurance
policy or other generally acceptable form of policy or insurance
acceptable
under the Underwriting Guidelines and each such title insurance
policy is
issued by a title insurer acceptable under the Underwriting
Guidelines 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
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negative amortization, the maximum amount of negative amortization
in
accordance with the Mortgage), subject only to the exceptions
contained in
clauses (i), (ii), (iii) and (iv) of paragraph (j) of this
Subsection 9.02,
and in the case of Adjustable Rate Mortgage Loans, against any loss
by reason
of the invalidity or unenforceability of the lien resulting from
the
provisions of the Mortgage providing for adjustment to the Mortgage
Interest
Rate and Monthly Payment. Where required by state law or
regulation, the
Mortgagor has been given the opportunity to choose the carrier of
the required
mortgage 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 insured 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;
(q) 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 e
