Common use of Repurchase and Substitution Clause in Contracts

Repurchase and Substitution. It is understood and agreed that the representations and warranties set forth in Sections 3.01, 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the Purchaser, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledge. Upon discovery by either of the Sellers or the Purchaser of a breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is determined by the Purchaser to cure such breach provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice to, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price, together with all expenses incurred by the Purchaser as a result of such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within the applicable cure period or such additional time, if any, as is determined by the Purchaser, then such Seller shall, at the direction of the Purchaser, repurchase the Defective Mortgage Loan at the applicable Repurchase Price. Notwithstanding anything to the contrary contained herein, if the first regularly scheduled payment of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) of Section 3.03 or any Deemed Material Breach Representation, the applicable Seller may, at the Purchaser’s option and assuming that such Seller has a Qualified Substitute Mortgage Loan or Loans, rather than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan (“Deleted Mortgage Loan”) and substitute in its place a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for such Qualified Substitute Mortgage Loan or Loans the Legal Documents as are required by Section 2. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.01, 3.02 and 3.03. For any month in which the applicable Seller substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loans. The amount of such shortfall shall be paid by the applicable Seller on the date of such substitution) by wire transfer of immediately available funds directly to the Purchaser’s Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) by wire transfer of immediately available funds directly to the Purchaser’s Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) to cure any breach of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trust.

Repurchase and Substitution. It is understood and agreed that the The representations and warranties set forth in Sections 3.01, 3.01 and 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the PurchaserOwner, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment of Mortgage or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers Company or the Purchaser an Owner of a breach of any of the representations and warranties contained set forth in Sections 3.013.01 and 3.02 (which breach shall be determined without regard to language qualifying such representation or warranty as being made to the Company’s best knowledge), 3.02 which breach materially and adversely affects the value of the Mortgage Loans or 3.03 that the interest of the Owner (or which materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser Owner in the related Mortgage Loan, Loan in the case of a representation or and warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from Upon the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller Company of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected , the Company shall use its best efforts to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is determined by the Purchaser to promptly cure such breach provided that the Seller has commenced curing or correcting in all material respects within 60 days, and, if such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice tocannot be cured during such time period, the applicable Seller of any breach of Company shall, at the representation and warranty set forth in paragraph (52) of Section 3.03Owner’s option, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price. If any such breach shall involve any representation or warranty set forth in Section 3.01, together with all expenses incurred by the Purchaser as a result of and such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within 60 days of the applicable cure period earlier of either discovery by or notice to the Company of such additional timebreach, if any, as is determined by all the Purchaser, then such Seller Mortgage Loans shall, at the direction of Owner’s option, be repurchased by the Purchaser, repurchase the Defective Mortgage Loan Company at the applicable Repurchase Price. Notwithstanding anything to ; provided, however, that in the contrary contained herein, if the first regularly scheduled payment event of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery breach of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) Section 3.01 that relates to less than all of the Mortgage Loans in the related Mortgage Loan Package, the Company shall repurchase only the Mortgage Loans to which such breach relates. However, the Company may, with the consent of the Owner, replace a Mortgage Loan as to which a breach of representation of warranty has occurred as described in the foregoing sentences of this Section 3.03 or any Deemed Material Breach Representation, the applicable Seller may, at the Purchaser’s option and assuming that such Seller has substitute in its place with a Qualified Substitute Mortgage Loan or Loans, rather provided, however, that any such substitution shall be effected not later than 120 days after the Closing Date and only with respect to those Mortgage Loans that have not been transferred to a securitization trust. Any repurchase the of a Mortgage Loan as provided above, remove or Loans pursuant to the foregoing provisions of this Section 3.03 shall be accomplished by deposit in the Custodial Account of the amount of the Repurchase Price (after deducting therefrom any amounts received in respect of such repurchased Mortgage Loan (“Deleted Mortgage Loan”) or Loans and substitute being held in its place the Custodial Account for future distribution). The Company shall effect any substitution of a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for Custodian the documents as are required to be delivered by Section 2.03, with the Mortgage Note endorsed as required by Section 2.03. No substitution will be made in any calendar month after the Determination Date occurring in such month. The Company shall deposit in the Custodial Account the Monthly Payment less the Servicing Fee due on such Qualified Substitute Mortgage Loan or Loans in the Legal Documents as are required month following the date of such substitution. Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the month of substitution will be retained by Section 2the Company. For the month of substitution, distributions to the Owner will include the Monthly Payment due on such Deleted Mortgage Loan in the month of substitution, and the Company shall thereafter be entitled to retain all amounts subsequently received by the Company in respect of such Deleted Mortgage Loan. The Company shall give written notice to the Owner that such substitution has taken place and shall amend the Mortgage Loan Schedule to reflect the removal of such Deleted Mortgage Loan from the terms of this Agreement and the substitution of the Qualified Substitute Mortgage Loan. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller Company shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.013.01 and 3.02, except to the extent a representation contained in Section 3.02 relates to an expressly specified percentage of the Mortgage Loans. If pursuant to the foregoing provisions the Company repurchases a Mortgage Loan that is a MERS Mortgage Loan, the Company shall either (i) cause MERS to execute and 3.03deliver an assignment of the Mortgage in recordable form to transfer the Mortgage from MERS to the Company on behalf of the Owner, and shall cause such Mortgage to be removed from registration on the MERS® System in accordance with MERS’ rules and regulations or (ii) cause MERS to designate on the MERS® System the Company as the beneficial holder with respect to such Mortgage Loan. For any month in which the applicable Seller Company substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller Company will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution is less than the aggregate Assumed Principal Balance of all such Deleted Mortgage Loans (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loanssubstitution). The amount of such shortfall shall be paid distributed by the applicable Seller Company in the month of substitution pursuant to Section 5.01. Accordingly, on the date of such substitution) by wire transfer of immediately available , the Company will deposit from its own funds directly into the Custodial Account an amount equal to the Purchaser’s Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) by wire transfer of immediately available funds directly to the Purchaser’s Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) to cure any breach amount of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trustshortfall.

Repurchase and Substitution. It is understood and agreed that the representations and warranties set forth in Sections 3.01, 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the Purchaser, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment or the examination examination, or lack of examination, of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers Seller, the Servicer or the Purchaser of a breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the value of the Mortgage Loans or the interest of the Purchaser in the Mortgage Loans (or that materially and adversely affects the value of the related Mortgage Loan or the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period A breach of time representations and warranties in the first sentence of Section 3.03(21) and Sections 3.03(41) and (52) shall be deemed to cure as set forth materially and adversely affect the value of the related Mortgage Loan and the interest of the Purchaser therein. With respect to the representations and warranties contained in Section 2.043.03 that are made to the Seller’s knowledge, if it is discovered by either the Seller or the Purchaser that the substance of such representation and warranty is inaccurate and such inaccuracy materially and adversely affects the value of the related Mortgage Loan, the applicable Purchaser shall be entitled to all the remedies to which it would be entitled for a breach of such representation or warranty, including, without limitation, the repurchase requirements contained herein, notwithstanding Seller’s lack of knowledge with respect to the inaccuracy at the time the representation or warranty was made. The Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or Section 3.03 that materially and adversely affects the value of the Mortgage Loans or the interest of the Purchaser in the Mortgage Loans (or that materially and adversely affects the value of the related Mortgage Loan or the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (any such Mortgage Loan, a “Defective Mortgage Loan”; provided that the term “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest2.04) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is determined by the Purchaser to cure such breach provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice to, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price, together with all expenses incurred by the Purchaser as a result of such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within the applicable cure period or such additional time, if any, as is determined by the Purchaser60 day period, then such Seller shall, at the direction of the Purchaser, shall either (i) repurchase the Defective Mortgage Loan at the applicable Repurchase PricePrice or (ii) except for a breach of the representation and warranty in Section 3.03(52), make an indemnification payment to Purchaser in an amount equal to the reduction in value of such Mortgage Loan as a result of such breach. Notwithstanding anything to the contrary contained herein, if the first regularly scheduled payment of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 30 Business Days following the delivery of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor therefore by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding In the previous paragraphevent that a breach of a representation or warranty set forth in either Section 3.01 or Section 3.02 that materially and adversely affects the value of one or more of the Mortgage Loans or the interest of the Purchaser in such Mortgage Loans, with and such breach is not cured within 60 days of the exception earlier of either discovery by or notice to the Seller or Servicer of such breach, all such affected Mortgage Loans shall, at the option of the Purchaser, be repurchased by the Seller at the Repurchase Price. Any such repurchase shall be accomplished by wire transfer of the amount of the Repurchase Price to an account designated by the Purchaser. If the breach of representation and warranty that gave rise to the obligation to repurchase or substitute a Mortgage Loan pursuant to this Section 3.04 was the representation and warranty set forth in paragraph clause (529) or (41) of Section 3.03 3.03, then the Seller shall pay to the Purchaser, concurrently with and in addition to the remedies provided in this Section 3.04, an amount equal to any liability, penalty or any Deemed Material Breach Representationexpense that was actually incurred and paid out of or on behalf of the Purchaser, and that directly resulted from such breach, or if incurred and paid by the Purchaser thereafter, concurrently with such payment. Notwithstanding the previous paragraph, the applicable Seller may, at the Purchaser’s its option and assuming that such Seller has a Qualified Substitute Mortgage Loan or Loans, and with Purchaser's prior written consent, within 2 years from the related Funding Date, rather than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan (“Deleted Mortgage Loan”) and substitute in its place a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for such Qualified Substitute Mortgage Loan or Loans the Legal Documents as are required by Section 22.02. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller and Servicer shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.01, 3.02 and 3.03. For any month in which the applicable Seller substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loans. The amount of such shortfall shall be paid by the applicable Seller on the date of such substitution) substitution by wire transfer of immediately available funds directly to the Purchaser’s Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days on or before the Remittance Date applicable to the Due Period of expiration of the applicable time period referred to above in paragraph 3.04(3) which such repurchase transaction has occurred by wire transfer of immediately available funds directly to the Purchaser’s Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) 3.04 to cure any breach of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase or substitute for the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. The parties further agree thatIn the event of a repurchase, in recognition indemnification payment or substitution, the Seller shall, simultaneously with such repurchase, indemnification payment or substitution, give written notice (by telecopier, electronically or otherwise) to the Purchaser that such repurchase or substitution has taken place, amend the related Mortgage Loan Schedule to reflect the withdrawal of the Trust’s rights against PHH Deleted Mortgage Loan from this Agreement, and in the case of substitution, identify the Qualified Substitute Mortgage Loan(s) and amend the related Mortgage Loan Schedule to reflect the addition of such Qualified Substitute Mortgage Loan(s) this Agreement. In the event that any Mortgage Loan is held by a REMIC, notwithstanding any contrary provision of this Agreement, with respect to any Mortgage Loan that is not in default or as to which no default is imminent, Purchaser may, in connection with any repurchase or substitution of a Defective Mortgage Loan pursuant to this Section 3.04, reasonably require that the Mortgage Loans acquired by it from PHH Mortgage and conveyed Seller deliver, at the Seller’s expense, an Opinion of Counsel to the effect that such repurchase or substitution will not (i) result in the imposition of taxes on “prohibited transactions” of such REMIC (as defined in Section 860F of the Code) or otherwise subject the REMIC to tax, or (ii) cause the REMIC to fail to qualify as a REMIC at any time. The parties agree that the resolution of any controversy or claim arising out of or relating to an obligation or alleged obligation of the Seller to repurchase a Mortgage Loan due to a breach of a representation or warranty contained in Section 3.03 hereof shall be by Arbitration. If any allegation of a breach of a representation or warranty made in Section 3.03 has not been resolved to the satisfaction of both the Purchaser hereunderand the Seller, either party may commence Arbitration to resolve the dispute; provided that a party may commence Arbitration with respect to one or more unresolved allegations only during the months of January, April, July and October, and all matters with respect to which Arbitration has been commenced in any such month shall be heard in a single Arbitration in the immediately following month or as soon as practicable thereafter. To commence Arbitration, the moving party shall deliver written notice to the other party that it has elected to pursue Arbitration in accordance with this Section 3.04, provided that if the Seller has not responded to the Purchaser's notification of a breach of a representation and warranty, the Purchaser shall not commence Arbitration with respect to that breach before 60 days following such notification in order to provide the Seller with an opportunity to respond to such notification. Within 10 Business Days after a party has provided notice that it has elected to pursue Arbitration, each party may submit the names of one or more proposed Arbitrators to the other party in writing. If the parties have not agreed on the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than selection of an Arbitrator within five Business Days after the first such submission, then the party commencing Arbitration shall, within the next 5 business days, notify the American Arbitration Association in New York, NY and request that it appoint a single Arbitrator with experience in arbitrating disputes arising in the financial services industry. It is the intention of the parties that Arbitration shall be conducted in as efficient and cost-effective a result manner as is reasonably practicable, without the burden of discovery. Accordingly, the Arbitrator will resolve the dispute on the basis of a breach review of the written correspondence between the parties (including any supporting materials attached to such correspondence) conveyed by the Trust parties to each other in connection with the dispute prior to the delivery of Section 3.03(3) or 3.03(15) hereofnotice to commence Arbitration; however, in which case upon a showing of good cause, a party may request the Purchaser shall have Arbitrator to direct the right to cause production of such additional information, evidence and/or documentation from the Trust to repurchase directly parties that the Defective Mortgage Loan) acquired hereunder Arbitrator deems appropriate. If requested by the Purchaser from Arbitrator or any party, any hearing with respect to an Arbitration shall be conducted by video conference or teleconference except upon the Trustagreement of both parties or the request of the Arbitrator. The finding of the Arbitrator shall be final and binding upon the parties. Judgment upon any arbitration award rendered may be entered and enforced in any court of competent jurisdiction. The costs of the Arbitrator shall be shared equally between both parties. Each party, however, shall bear its own attorneys fees and costs in connection with the Arbitration.

Repurchase and Substitution. It is understood and agreed that the representations and warranties set forth in these Sections 3.01, 3.01 and 3.02 and 3.03 shall survive the sale and delivery of the Mortgage Loans to the Purchaser and shall inure to the benefit of the Purchaser, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment or the examination of any Mortgage File File. It is further understood and notwithstanding agreed that with respect to the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was representations and warranties which were made to the best of the SellerCompany’s knowledge, if it is discovered by the Company or the Purchaser that the substance of such representation or warranty is inaccurate and such inaccuracy materially and adversely affects the value of the related Mortgage Loan or the Purchaser’s interest therein, the Purchaser will be entitled to all the remedies to which it would be entitled for breach of a representation or warranty, including, without limitation, the repurchase requirements contained herein, notwithstanding the Company’s lack of knowledge with respect to the inaccuracy at the time the representation or warranty was made. Upon discovery by either of the Sellers Company or the Purchaser of a breach of any of the foregoing representations and warranties contained in Sections 3.01, 3.02 or 3.03 that which materially and adversely affects the value of the Mortgage Loans or the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related any Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period of time to cure as set forth in Section 2.04, the applicable Seller The Company shall have a period of 60 sixty days from the earlier of either its discovery by or its receipt of written notice from the Purchaser to the Seller of any such breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is determined by the Purchaser to cure such breach provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice to, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price, together with all expenses incurred by the Purchaser as a result of such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller The Company hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, that if any such breach relating thereto cannot be corrected or cured within such sixty day period, the applicable cure period Company shall, not later than ninety days of its discovery or its receipt of notice of such additional timebreach, if anyrepurchase such Mortgage Loan at a price equal to (i) the Stated Principal Balance of the Mortgage Loan plus (ii) accrued interest on such Stated Principal Balance at the Mortgage Loan Remittance Rate from the date to which interest has last been paid and distributed to the Purchaser to the date of repurchase. In the event that any such breach shall involve any representation or warranty set forth in Section 3.01, as is determined and such breach cannot be cured within sixty days of the earlier discovery or receipt of notice by the PurchaserCompany of such breach, then such Seller all Mortgage Loans shall, at the direction option of the Purchaser, be repurchased by the Company at prices and amounts as computed above. Any such repurchase shall be accomplished by deposit in the Defective Custodial Account of the amount of the repurchase price, after deducting therefrom any amounts received in respect of such repurchased Mortgage Loan at and being held in the applicable Repurchase PriceCustodial Account for future distribution. Notwithstanding anything If the Company is required to the contrary contained herein, if the first regularly scheduled payment of principal and interest due under repurchase any Mortgage Loan has been delinquent more than 30 dayspursuant to the preceding paragraph within one hundred and twenty days from the Closing Date, the Purchaser Company may, by written notice to with the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery consent of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) of Section 3.03 or any Deemed Material Breach Representation, the applicable Seller may, at the Purchaser’s option and assuming that such Seller the Company has a Qualified Substitute Mortgage Loan or Loans, rather than repurchase the Mortgage Loan as provided aboveLoan, remove such deficient Mortgage Loan (“Deleted Mortgage Loan”) from the terms of this Agreement and within such one hundred and twenty day period substitute in its place a Qualified Substitute Mortgage Loan or Loansfor such deficient Mortgage Loan, in lieu of repurchasing such deficient Mortgage Loan. The Purchaser may reasonably require, prior to any substitution into a REMIC pass-through entity, that the Company provide the Purchaser with an Opinion of Counsel that the substitution of the applicable Qualified Substitute Mortgage Loan will not effect the status of the pass-through entity as a REMIC. If the applicable Seller Company has no Qualified Substitute Mortgage LoanLoan and is unable to obtain an Opinion of Counsel, it shall must repurchase the Defective deficient Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for such Qualified Substitute Mortgage Loan or Loans the Legal Documents as are required by Section 2. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.01, 3.02 and 3.03. For any month in which the applicable Seller substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loans. The amount of such shortfall shall be paid by the applicable Seller on the date of such substitution) by wire transfer of immediately available funds directly to the Purchaser’s Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) by wire transfer of immediately available funds directly to the Purchaser’s Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) to cure any breach of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trust.

Repurchase and Substitution. It is understood and agreed that the representations and warranties set forth in Sections 3.01, 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the Purchaser, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledge. Upon discovery by either of the Sellers or the Purchaser of a breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is determined by the Purchaser to cure such breach provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice to, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price, together with all expenses incurred by the Purchaser as a result of such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within the applicable cure period or such additional time, if any, as is determined by the Purchaser, then such Seller shall, at the direction of the Purchaser, repurchase the Defective Mortgage Loan at the applicable Repurchase Price. Notwithstanding anything to the contrary contained herein, if the first regularly scheduled payment of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph paragraphs (24), (40), (49), (52), (54) and (59) of Section 3.03 or any Deemed Material Breach Representation3.03, the applicable Seller may, at the Purchaser’s option and assuming that such Seller has a Qualified Substitute Mortgage Loan or Loans, rather than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan (“Deleted Mortgage Loan”) and substitute in its place a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for such Qualified Substitute Mortgage Loan or Loans the Legal Documents as are required by Section 2. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.01, 3.02 and 3.03. For any month in which the applicable Seller substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loans. The amount of such shortfall shall be paid by the applicable Seller on the date of such substitution) by wire transfer of immediately available funds directly to the Purchaser’s Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) by wire transfer of immediately available funds directly to the Purchaser’s Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) to cure any breach of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trust.

Repurchase and Substitution. It is understood and agreed that the representations and warranties set forth in Sections 3.01, 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the Purchaser, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers or the Purchaser of a breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) in the event that (i) the first due date for a Mortgage Loan is subsequent to the Cut-off Date and the initial monthly payment is not made by the last day of the month in which such payment was due, or (ii) the first monthly payment due following the Cut-off Date on any Mortgage Loan regarding is not made by the last day of the month in which such payment was due will be repurchased by the Mortgagor fails to make applicable Seller at the first regularly scheduled payment of principal and interest) within which to correct or cure such breachRepurchase Price. If such breach can ultimately be cured but is not reasonably expected to be cured within the 60-day period, then then, at the option of the Purchaser, the applicable Seller shall have such additional time, if any, as is reasonably determined by the Purchaser to cure such breach provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice to, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price, together with all expenses incurred by the Purchaser as a result of such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within the applicable cure period or such additional time, if any, as is reasonably determined by the Purchaser, then such Seller shall, at the direction of the Purchaser, repurchase the Defective Mortgage Loan at the applicable Repurchase Price. Notwithstanding anything to the contrary contained herein, if the first regularly scheduled payment of principal and interest due to the Purchaser under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage LoanLoan at the Repurchase Price. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) of Section 3.03 or any Deemed Material Breach Representation, the applicable Seller may, at the Purchaser’s its option and assuming that such Seller has a Qualified Substitute Mortgage Loan or Loans, rather than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan (“Deleted Mortgage Loan”) and substitute in its place a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for such Qualified Substitute Mortgage Loan or Loans the Legal Documents as are required by Section 2. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.01, 3.02 and 3.03. For any month in which the applicable Seller substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loans. The amount of such shortfall shall be paid by the applicable Seller on the date of such substitution) by wire transfer of immediately available funds directly to the Purchaser’s Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) 3.04 by wire transfer of immediately available funds directly to the Purchaser’s Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) 3.04 to cure any breach of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. If set forth in the related Purchase Price and Terms Letter, in the event that the principal balance due on a Mortgage Loan is paid in full within six months following the related Funding Date, the Seller shall reimburse Purchaser the amount (if any) by which the Purchase Price paid by Purchaser to Seller exceeded 100% of the Unpaid Principal Balance of the Mortgage Loan as of the date of such prepayment in full, within ten days of such payoff. In the event of a repurchase or substitution, the Seller shall, simultaneously with such repurchase or substitution, give written notice (by telecopier, electronically or otherwise) to the Purchaser that such repurchase or substitution has taken place, amend the related Mortgage Loan Schedule to reflect the withdrawal of the Deleted Mortgage Loan from this Agreement, and in the case of substitution, identify the Qualified Substitute Mortgage Loan(s) and amend the related Mortgage Loan Schedule to reflect the addition of such Qualified Substitute Mortgage Loan(s) this Agreement. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(33.03 (3) or 3.03(153.03(16) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trust.

Repurchase and Substitution. It is understood and agreed that the The representations and warranties set forth in Sections 3.01, 3.01 and 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the PurchaserOwner, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment of Mortgage or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers Company or the Purchaser an Owner of a breach of any of the representations and warranties contained set forth in Sections 3.013.01 and 3.02 (notwithstanding the Company's lack of knowledge of such representation and warranty), 3.02 which breach materially and adversely affects the value of the Mortgage Loans or 3.03 that the interest of the Owner (or which materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser Owner in the related Mortgage Loan, Loan in the case of a representation or and warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from Upon the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller Company of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected , the Company shall use its best efforts to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is determined by the Purchaser to promptly cure such breach provided that the Seller has commenced curing or correcting in all material respects within 60 days, and, if such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice tocannot be cured during such time period, the applicable Seller of any breach of Company shall, at the representation and warranty set forth in paragraph (52) of Section 3.03Owner's option, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price. If any such breach shall involve any representation or warranty set forth in Section 3.01, together with all expenses incurred by the Purchaser as a result of and such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within 60 days of the applicable cure period earlier of either discovery by or notice to the Company of such additional timebreach, if any, as is determined by all the Purchaser, then such Seller Mortgage Loans shall, at the direction of Owner's option, be repurchased by the Purchaser, repurchase the Defective Mortgage Loan Company at the applicable Repurchase Price. Notwithstanding anything to ; provided, however, that in the contrary contained herein, if the first regularly scheduled payment event of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery breach of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) Section 3.01 that relates to less than all of Section 3.03 or any Deemed Material Breach Representationthe Mortgage Loans, the applicable Seller Company shall repurchase only the Mortgage Loans to which such breach relates. However, the Company may, at its option, replace a Mortgage Loan as to which a breach of representation of warranty has occurred as described in the Purchaser’s option foregoing sentences of this Section 3.03 and assuming that such Seller has substitute in its place with a Qualified Substitute Mortgage Loan or Loans, rather provided, however, that any such substitution shall be effected not later than 120 days after the Closing Date. Any repurchase the of a Mortgage Loan as provided above, remove or Loans pursuant to the foregoing provisions of this Section 3.03 shall be accomplished by deposit in the Custodial Account of the amount of the Repurchase Price (after deducting therefrom any amounts received in respect of such repurchased Mortgage Loan (“Deleted Mortgage Loan”) or Loans and substitute being held in its place the Custodial Account for future distribution). The Company shall effect any substitution of a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for Custodian the documents as are required to be delivered by Section 2.03, with the Mortgage Note endorsed as required by Section 2.03. No substitution will be made in any calendar month after the Determination Date occurring in such month. The Company shall deposit in the Custodial Account the Monthly Payment less the Servicing Fee due on such Qualified Substitute Mortgage Loan or Loans in the Legal Documents as are required month following the date of such substitution. Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the month of substitution will be retained by Section 2the Company. For the month of substitution, distributions to the Owner will include the Monthly Payment due on such Deleted Mortgage Loan in the month of substitution, and the Company shall thereafter be entitled to retain all amounts subsequently received by the Company in respect of such Deleted Mortgage Loan. The Company shall give written notice to the Owner that such substitution has taken place and shall amend the Mortgage Loan Schedule to reflect the removal of such Deleted Mortgage Loan from the terms of this Agreement and the substitution of the Qualified Substitute Mortgage Loan. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller Company shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.013.01 and 3.02, except to the extent a representation contained in Section 3.02 and 3.03relates to an expressly specified percentage of the Mortgage Loans. For any month in which the applicable Seller Company substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller Company will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution is less than the aggregate Assumed Principal Balance of all such Deleted Mortgage Loans (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loanssubstitution). The amount of such shortfall shall be paid distributed by the applicable Seller Company in the month of substitution pursuant to Section 5.01. Accordingly, on the date of such substitution) by wire transfer of immediately available , the Company will deposit from its own funds directly into the Custodial Account an amount equal to the Purchaser’s Accountamount of such shortfall. Any In addition to such repurchase obligation, the Company shall indemnify the Owner for any expenses reasonably incurred by the Owner in enforcing its remedies hereunder in connection with any breach by the Company of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above any representation or warranty set forth in paragraph 3.04(3) by wire transfer of immediately available funds directly to the Purchaser’s Accountthis Agreement. It is understood and agreed that the obligations of a Seller (a) the Company set forth in this Section 3.04(3) 3.03 to cure any breach of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective a defective Mortgage Loan(s) Loan and (b) set forth in Section 9.01 to indemnify the Purchaser Owner as provided in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and this Section 3.03 shall constitute the sole remedies of the Purchaser Owner respecting a breach of such the foregoing representations and warranties. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trust.

Repurchase and Substitution. It is understood and agreed that the The representations and warranties set forth in Sections 3.013.01 and 3.02, 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the PurchaserOwner, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment of Mortgage or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers Company or the Purchaser an Owner of a breach (including any occurrence, condition, act or omission that would be a breach in the event that the Company were to have knowledge thereof) (a "Repurchase Event") of any of the representations and warranties contained set forth in Sections 3.013.01 and 3.02 (notwithstanding the Company's lack of knowledge of such representation and warranty), 3.02 which Repurchase Event materially and adversely affects the value of the Mortgage Loans or 3.03 that the interest of the Owner (or which materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser Owner in the related Mortgage Loan, Loan in the case of a representation or and warranty relating to a particular Mortgage Loan), the party discovering such breach Repurchase Event shall give prompt written notice to the other. Unless permitted a greater period of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser Within ninety (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is determined by the Purchaser to cure such breach provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (3090) days of the earlier of either discovery by, by or notice toto the Company of any such Repurchase Event, the applicable Seller of any breach of the representation and warranty set forth Company shall use its best efforts to promptly cure such Repurchase Event in paragraph all material respects and, if such Repurchase Event cannot be cured during such ninety (5290) of Section 3.03day period, the applicable Seller shall Company shall, at the Owner's option, repurchase such Mortgage Loan at the Repurchase Price. If any such breach shall involve any representation or warranty set forth in Section 3.01, together with all expenses incurred by the Purchaser as a result of and such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within ninety (90) days of the applicable cure period earlier of either discovery by or notice to the Company of such additional timebreach, if any, as is determined by all the Purchaser, then such Seller Mortgage Loans shall, at the direction of Owner's option, be repurchased by the Purchaser, repurchase the Defective Mortgage Loan Company at the applicable Repurchase Price. Notwithstanding anything to ; provided, however, that in the contrary contained herein, if the first regularly scheduled payment event of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery breach of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) Section 3.01 that relates to less than all of Section 3.03 or any Deemed Material Breach Representationthe Mortgage Loans, the applicable Seller Company shall repurchase only the Mortgage Loans to which such breach relates. However, the Company may, at its option, replace a Mortgage Loan as to which a Repurchase Event has occurred as described in the Purchaser’s option foregoing sentences of this Section 3.03 and assuming that such Seller has substitute in its place with a Qualified Substitute Mortgage Loan or Loans, rather provided, however, that any such substitution shall be effected not later than repurchase 120 days after the Mortgage Loan as provided above, remove such Mortgage Loan (“Deleted Mortgage Loan”) and substitute in its place a Qualified Substitute Mortgage Loan or Loansrelated Closing Date. If the applicable Seller Company has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted deficient Mortgage Loan within ninety (90) days after the written notice of the Repurchase Event. Any repurchase of a Mortgage Loan or Loans pursuant to the foregoing provisions of this Section 3.03 shall be accomplished by deposit in the Custodial Account of the amount of the Repurchase Price (after deducting therefrom any amounts received in respect of such repurchased Mortgage Loan or Loans and being held in the Custodial Account for which the applicable Seller substitutes future distribution). The Company shall effect any substitution of a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for Owner the documents as are required to be delivered by Section 2.03, with the Mortgage Note endorsed as required by Section 2.03. No substitution will be made in any calendar month after the Determination Date occurring in such month. The Company shall deposit in the Custodial Account the Monthly Payment less the Servicing Fee due on such Qualified Substitute Mortgage Loan or Loans in the Legal Documents as are required month following the date of such substitution. Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the month of substitution will be retained by Section 2the Company. For the month of substitution, distributions to the Owner will include the Monthly Payment due on such Deleted Mortgage Loan in the month of substitution, and the Company shall thereafter be entitled to retain all amounts subsequently received by the Company in respect of such Deleted Mortgage Loan. The Company shall give written notice to the Owner that such substitution has taken place and shall amend the Mortgage Loan Schedule to reflect the removal of such Deleted Mortgage Loan from the terms of this Agreement and the substitution of the Qualified Substitute Mortgage Loan. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller Company shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.013.01 and 3.02, except to the extent a representation contained in Section 3.02 and 3.03relates to an expressly specified percentage of the Mortgage Loans. For any month in which the applicable Seller Company substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller Company will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution is less than the aggregate Assumed Principal Balance of all such Deleted Mortgage Loans (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loanssubstitution). The amount of such shortfall shall be paid distributed by the applicable Seller Company in the month of substitution pursuant to Section 5.01. Accordingly, on the date of such substitution) by wire transfer of immediately available , the Company will deposit from its own funds directly into the Custodial Account an amount equal to the Purchaser’s Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) by wire transfer of immediately available funds directly to the Purchaser’s Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) to cure any breach amount of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trustshortfall.

Repurchase and Substitution. It is understood and agreed that the representations and warranties set forth in Sections 3.01, 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the Purchaser, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers or the Purchaser of a breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is reasonably determined by the Purchaser to cure such breach provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice to, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price, together with all expenses incurred by the Purchaser as a result of such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within the applicable cure period or such additional time, if any, as is reasonably determined by the Purchaser, then such Seller shall, at the direction of the Purchaser, repurchase the Defective Mortgage Loan at the applicable Repurchase Price. Notwithstanding the above sentence, within 30 days of the earlier of either discovery by, or notice to, the Sellers of any breach of the representations or warranties set forth in clauses (24), (54), (56), (57), (60), (61) and (64) of Section 3.03, the Sellers shall repurchase such Mortgage Loan at the Repurchase Price, together with all expenses incurred by the Purchaser as a result of such repurchase. Notwithstanding anything to the contrary contained herein, if the first regularly scheduled payment of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides written evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) of Section 3.03 or any Deemed Material Breach Representation, the applicable Seller may, at the Purchaser’s its option and assuming that such Seller has a Qualified Substitute Mortgage Loan or Loans, rather than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan (“Deleted Mortgage Loan”) and substitute in its place a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for such Qualified Substitute Mortgage Loan or Loans the Legal Documents as are required by Section 2. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.01, 3.02 and 3.03. For any month in which the applicable Seller substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loans. The amount of such shortfall shall be paid by the applicable Seller on the date of such substitution) by wire transfer of immediately available funds directly to the Purchaser’s Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) 3.04 by wire transfer of immediately available funds directly to the Purchaser’s Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) 3.04 to cure any breach of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(33.03 (3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trust.

Repurchase and Substitution. It is understood and agreed that the The representations and warranties set forth in Sections 3.01, 3.01 and 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the PurchaserOwner, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment of Mortgage or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers Company or the Purchaser an Owner of a breach of any of the representations and warranties contained set forth in Sections 3.013.01 and 3.02 (notwithstanding the Company’s lack of knowledge of such representation and warranty), 3.02 which breach materially and adversely affects the value of the Mortgage Loans or 3.03 that the interest of the Owner (or which materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser Owner in the related Mortgage Loan, Loan in the case of a representation or and warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period Within 90 days of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller Company of any breach of any of such breach, the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating Company shall use its best efforts to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or promptly cure such breach. If breach in all material respects and, if such breach can ultimately cannot be cured but is not reasonably expected to be cured within the 60-during such 90 day period, then the applicable Seller shall have such additional timeCompany shall, if anyat the Owner’s option, as is determined by the Purchaser to cure such breach provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice to, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price. If any such breach shall involve any representation or warranty set forth in Section 3.01, together with all expenses incurred by the Purchaser as a result of and such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within 90 days of the applicable cure period earlier of either discovery by or notice to the Company of such additional timebreach, if any, as is determined by all the Purchaser, then such Seller Mortgage Loans shall, at the direction of Owner’s option, be repurchased by the Purchaser, repurchase the Defective Mortgage Loan Company at the applicable Repurchase Price. Notwithstanding anything to ; provided, however, that in the contrary contained herein, if the first regularly scheduled payment event of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery breach of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) Section 3.01 that relates to less than all of Section 3.03 or any Deemed Material Breach Representationthe Mortgage Loans, the applicable Seller Company shall repurchase only the Mortgage Loans to which such breach relates. However, the Company may, at its option, replace a Mortgage Loan as to which a breach of representation of warranty has occurred as described in the Purchaser’s option foregoing sentences of this Section 3.03 and assuming that such Seller has substitute in its place with a Qualified Substitute Mortgage Loan or Loans, rather provided, however, that any such substitution shall be effected not later than 120 days after the Closing Date. Any repurchase the of a Mortgage Loan as provided above, remove or Loans pursuant to the foregoing provisions of this Section 3.03 shall be accomplished by deposit in the Custodial Account of the amount of the Repurchase Price (after deducting there from any amounts received in respect of such repurchased Mortgage Loan (“Deleted Mortgage Loan”) or Loans and substitute being held in its place the Custodial Account for future distribution). The Company shall effect any substitution of a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for Custodian the documents as are required to be delivered by Section 2.03, with the Mortgage Note endorsed as required by Section 2.03. No substitution will be made in any calendar month after the Determination Date occurring in such month. The Company shall deposit in the Custodial Account the Monthly Payment less the Servicing Fee due on such Qualified Substitute Mortgage Loan or Loans in the Legal Documents as are required month following the date of such substitution. Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the month of substitution will be retained by Section 2the Company. For the month of substitution, distributions to the Owner will include the Monthly Payment due on such Deleted Mortgage Loan in the month of substitution, and the Company shall thereafter be entitled to retain all amounts subsequently received by the Company in respect of such Deleted Mortgage Loan. The Company shall give written notice to the Owner that such substitution has taken place and shall amend the Mortgage Loan Schedule to reflect the removal of such Deleted Mortgage Loan from the terms of this Agreement and the substitution of the Qualified Substitute Mortgage Loan. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller Company shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.013.01 and 3.02, except to the extent a representation contained in Section 3.02 and 3.03relates to an expressly specified percentage of the Mortgage Loans. For any month in which the applicable Seller Company substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller Company will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution is less than the aggregate Assumed Principal Balance of all such Deleted Mortgage Loans (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loanssubstitution). The amount of such shortfall shall be paid distributed by the applicable Seller Company in the month of substitution pursuant to Section 5.01. Accordingly, on the date of such substitution) by wire transfer of immediately available , the Company will deposit from its own funds directly into the Custodial Account an amount equal to the Purchaser’s Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) by wire transfer of immediately available funds directly to the Purchaser’s Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) to cure any breach amount of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trustshortfall.

Repurchase and Substitution. It is understood and agreed that the The representations and warranties set forth in Sections 3.01, 3.01 and 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the Purchaser, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment of Mortgage or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers Seller or the an Purchaser of a breach of any of the representations and warranties contained set forth in Sections 3.013.01 and 3.02 (notwithstanding the Seller’s lack of knowledge of such representation and warranty), 3.02 which breach materially and adversely affects the value of the Mortgage Loans or 3.03 that the interest of the Purchaser (or which materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, Loan in the case of a representation or and warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period Within 90 days of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller of any breach of any of such breach, the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating Seller shall use its best efforts to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or promptly cure such breach. If breach in all material respects and, if such breach can ultimately cannot be cured but is not reasonably expected to be cured within the 60-during such 90 day period, then the applicable Seller shall have such additional time, if any, as is determined by the Purchaser to cure such breach provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding shall, at the abovePurchaser’s option, (i) within thirty (30) days of the earlier of either discovery by, or notice to, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price. If any such breach shall involve any representation or warranty set forth in Section 3.01, together with all expenses incurred by the Purchaser as a result of and such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within 90 days of the applicable cure period earlier of either discovery by or notice to the Seller of such additional timebreach, if any, as is determined by all the Purchaser, then such Seller Mortgage Loans shall, at the direction of Purchaser’s option, be repurchased by the Purchaser, repurchase the Defective Mortgage Loan Seller at the applicable Repurchase Price. Notwithstanding anything to ; provided, however, that in the contrary contained herein, if the first regularly scheduled payment event of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery breach of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) Section 3.01 that relates to less than all of Section 3.03 or any Deemed Material Breach Representationthe Mortgage Loans, the applicable Seller shall repurchase only the Mortgage Loans to which such breach relates. However, the Seller may, at its option, replace a Mortgage Loan as to which a breach of representation of warranty has occurred as described in the Purchaser’s option foregoing sentences of this Section 3.03 and assuming that such Seller has substitute in its place with a Qualified Substitute Mortgage Loan or Loans, rather provided, however, that any such substitution shall be effected not later than 120 days after the Funding Date. Any repurchase the of a Mortgage Loan as provided above, remove or Loans pursuant to the foregoing provisions of this Section 3.03 shall be accomplished by deposit in the Custodial Account of the amount of the Repurchase Price (after deducting therefrom any amounts received in respect of such repurchased Mortgage Loan (“Deleted Mortgage Loan”) or Loans and substitute being held in its place the Custodial Account for future distribution). The Seller shall effect any substitution of a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for Custodian the documents as are required to be delivered by Section 2.03, with the Mortgage Note endorsed as required by Section 2.03. No substitution will be made in any calendar month after the Determination Date occurring in such month. The Seller shall deposit in the Custodial Account the Monthly Payment less the Servicing Fee due on such Qualified Substitute Mortgage Loan or Loans in the Legal Documents as are required month following the date of such substitution. Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the month of substitution will be retained by Section 2the Seller. For the month of substitution, distributions to the Purchaser will include the Monthly Payment due on such Deleted Mortgage Loan in the month of substitution, and the Seller shall thereafter be entitled to retain all amounts subsequently received by the Seller in respect of such Deleted Mortgage Loan. The Seller shall give written notice to the Purchaser that such substitution has taken place and shall amend the Mortgage Loan Schedule to reflect the removal of such Deleted Mortgage Loan from the terms of this Agreement and the substitution of the Qualified Substitute Mortgage Loan. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.013.01 and 3.02, except to the extent a representation contained in Section 3.02 and 3.03relates to an expressly specified percentage of the Mortgage Loans. For any month in which the applicable Seller substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution is less than the aggregate Assumed Principal Balance of all such Deleted Mortgage Loans (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loanssubstitution). The amount of such shortfall shall be paid distributed by the applicable Seller in the month of substitution pursuant to Section 5.01. Accordingly, on the date of such substitution) by wire transfer of immediately available , the Seller will deposit from its own funds directly into the Custodial Account an amount equal to the Purchaser’s Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) by wire transfer of immediately available funds directly to the Purchaser’s Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) to cure any breach amount of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trustshortfall.

Repurchase and Substitution. It is understood and agreed that the The representations and warranties set forth in Sections 3.01, 3.01 and 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the PurchaserOwner, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment of Mortgage or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers Company or the Purchaser an Owner of a breach of any of the representations and warranties contained set forth in Sections 3.013.01 and 3.02 (notwithstanding the Company's lack of knowledge of such representation and warranty), 3.02 which breach materially and adversely affects the value of the Mortgage Loans or 3.03 that the interest of the Owner (or which materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser Owner in the related Mortgage Loan, Loan in the case of a representation or and warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from Upon the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller Company of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected , the Company shall use its best efforts to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is determined by the Purchaser to promptly cure such breach provided that the Seller has commenced curing or correcting in all material respects within 60 days, and, if such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice tocannot be cured during such time period, the applicable Seller of any breach of Company shall, at the representation and warranty set forth in paragraph (52) of Section 3.03Owner's option, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price. If any such breach shall involve any representation or warranty set forth in Section 3.01, together with all expenses incurred by the Purchaser as a result of and such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within 60 days of the applicable cure period earlier of either discovery by or notice to the Company of such additional timebreach, if any, as is determined by all the Purchaser, then such Seller Mortgage Loans shall, at the direction of Owner's option, be repurchased by the Purchaser, repurchase the Defective Mortgage Loan Company at the applicable Repurchase Price. Notwithstanding anything to ; provided, however, that in the contrary contained herein, if the first regularly scheduled payment event of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery breach of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) Section 3.01 that relates to less than all of Section 3.03 or any Deemed Material Breach Representationthe Mortgage Loans, the applicable Seller Company shall repurchase only the Mortgage Loans to which such breach relates. However, the Company may, at its option, replace a Mortgage Loan as to which a breach of representation of warranty has occurred as described in the Purchaser’s option foregoing sentences of this Section 3.03 and assuming that such Seller has substitute in its place with a Qualified Substitute Mortgage Loan or Loans, rather provided, however, that any such substitution shall be effected not later than 120 days after the related Closing Date. Any repurchase the of a Mortgage Loan as provided above, remove or Loans pursuant to the foregoing provisions of this Section 3.03 shall be accomplished by deposit in the Custodial Account of the amount of the Repurchase Price (after deducting therefrom any amounts received in respect of such repurchased Mortgage Loan (“Deleted Mortgage Loan”) or Loans and substitute being held in its place the Custodial Account for future distribution). The Company shall effect any substitution of a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for Custodian the documents as are required to be delivered by Section 2.03, with the Mortgage Note endorsed as required by Section 2.03. No substitution will be made in any calendar month after the Determination Date occurring in such month. The Company shall deposit in the Custodial Account the Monthly Payment less the Servicing Fee due on such Qualified Substitute Mortgage Loan or Loans in the Legal Documents as are required month following the date of such substitution. Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the month of substitution will be retained by Section 2the Company. For the month of substitution, distributions to the Owner will include the Monthly Payment due on such Deleted Mortgage Loan in the month of substitution, and the Company shall thereafter be entitled to retain all amounts subsequently received by the Company in respect of such Deleted Mortgage Loan. The Company shall give written notice to the Owner that such substitution has taken place and shall amend the Mortgage Loan Schedule to reflect the removal of such Deleted Mortgage Loan from the terms of this Agreement and the substitution of the Qualified Substitute Mortgage Loan. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller Company shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.013.01 and 3.02, except to the extent a representation contained in Section 3.02 and 3.03relates to an expressly specified percentage of the Mortgage Loans. For any month in which the applicable Seller Company substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller Company will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution is less than the aggregate Assumed Principal Balance of all such Deleted Mortgage Loans (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loanssubstitution). The amount of such shortfall shall be paid distributed by the applicable Seller Company in the month of substitution pursuant to Section 5.01. Accordingly, on the date of such substitution) by wire transfer of immediately available , the Company will deposit from its own funds directly into the Custodial Account an amount equal to the Purchaser’s Accountamount of such shortfall. Any In addition to such repurchase obligation, the Company shall indemnify the Owner for any expenses reasonably incurred by the Owner in enforcing its remedies hereunder in connection with any breach by the Company of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above any representation or warranty set forth in paragraph 3.04(3) by wire transfer of immediately available funds directly to the Purchaser’s Accountthis Agreement. It is understood and agreed that the obligations of a Seller (a) the Company set forth in this Section 3.04(3) 3.03 to cure any breach of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective a defective Mortgage Loan(s) Loan and (b) set forth in Section 9.01 to indemnify the Purchaser Owner as provided in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall this Section 3-03 constitute the sole remedies of the Purchaser Owner respecting a breach of such the foregoing representations and warranties. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trust.

Repurchase and Substitution. 33- It is understood and agreed that the representations and warranties set forth in Sections 3.01, 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the Purchaser, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers or the Purchaser of a breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (a “"Defective Mortgage Loan”"; provided that “"Defective Mortgage Loan” " shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is reasonably determined by the Purchaser to cure such breach provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice to, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price, together with all expenses incurred by the Purchaser as a result of such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within the applicable cure period or such additional time, if any, as is reasonably determined by the Purchaser, then such Seller shall, at the direction of the Purchaser, repurchase the Defective Mortgage Loan at the applicable Repurchase Price. Notwithstanding anything to the contrary contained herein, if the first regularly scheduled payment of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides written evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s 's Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) of Section 3.03 or any Deemed Material Breach Representation, the applicable Seller may, at the Purchaser’s its option and assuming that such Seller has a Qualified Substitute Mortgage Loan or Loans, rather than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan (“"Deleted Mortgage Loan”") and substitute in its place a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for such Qualified Substitute Mortgage Loan or Loans the Legal Documents as are required by Section 2. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.01, 3.02 and 3.03. For any month in which the applicable Seller substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loans. The amount of such shortfall shall be paid by the applicable Seller on the date of such substitution) by wire transfer of immediately available funds directly to the Purchaser’s 's Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) 3.04 by wire transfer of immediately available funds directly to the Purchaser’s 's Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) 3.04 to cure any breach of such Seller’s 's representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s 's representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. The parties further agree that, in recognition of the Trust’s 's rights against PHH Cendant Mortgage with respect to the Mortgage Loans acquired by it from PHH Cendant Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Cendant Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(33.03 (3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trust.

Repurchase and Substitution. It is understood and agreed that the representations and warranties set forth in Sections 3.01, 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the Purchaser and Purchaser's successors, assignees or transferees, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers Seller or the Purchaser of a breach of any of the representations and warranties contained in Sections 3.01, 3.02 or and 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Revolving Credit Loan, in the case of a representation or warranty relating to a particular Mortgage Revolving Credit Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted Purchaser has granted a greater period of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Revolving Credit Loan, in the case of a representation or warranty relating to a particular Mortgage Revolving Credit Loan) within which to correct or cure such breach (each, a “"Defective Mortgage Revolving Credit Loan”"; provided that “"Defective Mortgage Revolving Credit Loan” " shall also include (a) any Mortgage Revolving Credit Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Revolving Credit Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) interest due to Purchaser hereunder within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is determined by the Purchaser to cure such breach provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) 30 days of the earlier of either discovery bydate upon which such Monthly Payment initially became due, or notice to, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price, together with all expenses incurred provided further that it is hereby acknowledged by the Purchaser as a result of parties hereto that there shall be no cure period for such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser thereindefects. Each Seller hereby covenants and agrees with respect to each Mortgage Revolving Credit Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within the applicable cure period or such additional time, if any, as is determined granted by the Purchaser, then such Seller shall, at the direction of the Purchaser, repurchase the Defective Mortgage Revolving Credit Loan at the applicable Repurchase Price. Notwithstanding anything to the contrary contained herein, if the first regularly scheduled payment of principal and interest due under to Purchaser hereunder with respect to any Mortgage Revolving Credit Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage LoanRevolving Credit Loan at the Repurchase Price. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Revolving Credit Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s 's Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) of Section 3.03 or any Deemed Material Breach Representation, the applicable Seller may, at the Purchaser’s option and assuming that such Seller has a Qualified Substitute Mortgage Loan or Loans, rather than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan (“Deleted Mortgage Loan”) and substitute in its place a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for such Qualified Substitute Mortgage Loan or Loans the Legal Documents as are required by Section 2. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.01, 3.02 and 3.03. For any month in which the applicable Seller substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loans. The amount of such shortfall shall be paid by the applicable Seller on the date of such substitution) by wire transfer of immediately available funds directly to the Purchaser’s Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) by wire transfer of immediately available funds directly to the Purchaser’s Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) to cure any breach of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trust.

Repurchase and Substitution. It is understood and agreed that the The representations and warranties set forth in Sections 3.01, 3.01 and 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the PurchaserOwner, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment of Mortgage or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers Company or the Purchaser an Owner of a breach of any of the representations and warranties contained set forth in Sections 3.013.01 and 3.02 (notwithstanding the Company’s lack of knowledge of such representation and warranty), 3.02 which breach materially and adversely affects the value of the Mortgage Loans or 3.03 that the interest of the Owner (or which materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser Owner in the related Mortgage Loan, Loan in the case of a representation or and warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period Within 90 days of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller Company of any breach of any of such breach, the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating Company shall use its best efforts to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or promptly cure such breach. If breach in all material respects and, if such breach can ultimately cannot be cured but is not reasonably expected to be cured within the 60-during such 90 day period, then the applicable Seller shall have such additional timeCompany shall, if anyat the Owner’s option, as is determined by the Purchaser to cure such breach provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice to, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price. If any such breach shall involve any representation or warranty set forth in Section 3.01, together with all expenses incurred by the Purchaser as a result of and such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within 90 days of the applicable cure period earlier of either discovery by or notice to the Company of such additional timebreach, if any, as is determined by all the Purchaser, then such Seller Mortgage Loans shall, at the direction of Owner’s option, be repurchased by the Purchaser, repurchase the Defective Mortgage Loan Company at the applicable Repurchase Price. Notwithstanding anything to ; provided, however, that in the contrary contained herein, if the first regularly scheduled payment event of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery breach of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) Section 3.01 that relates to less than all of Section 3.03 or any Deemed Material Breach Representationthe Mortgage Loans, the applicable Seller Company shall repurchase only the Mortgage Loans to which such breach relates. However, the Company may, at its option, replace a Mortgage Loan as to which a breach of representation of warranty has occurred as described in the Purchaser’s option foregoing sentences of this Section 3.03 and assuming that such Seller has substitute in its place with a Qualified Substitute Mortgage Loan or Loans, rather provided, however, that any such substitution shall be effected not later than 120 days after the Closing Date. Any repurchase the of a Mortgage Loan as provided above, remove or Loans pursuant to the foregoing provisions of this Section 3.03 shall be accomplished by deposit in the Custodial Account of the amount of the Repurchase Price (after deducting therefrom any amounts received in respect of such repurchased Mortgage Loan (“Deleted Mortgage Loan”) or Loans and substitute being held in its place the Custodial Account for future distribution). The Company shall effect any substitution of a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for Custodian the documents as are required to be delivered by Section 2.03, with the Mortgage Note endorsed as required by Section 2.03. No substitution will be made in any calendar month after the Determination Date occurring in such month. The Company shall deposit in the Custodial Account the Monthly Payment less the Servicing Fee due on such Qualified Substitute Mortgage Loan or Loans in the Legal Documents as are required month following the date of such substitution. Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the month of substitution will be retained by Section 2the Company. For the month of substitution, distributions to the Owner will include the Monthly Payment due on such Deleted Mortgage Loan in the month of substitution, and the Company shall thereafter be entitled to retain all amounts subsequently received by the Company in respect of such Deleted Mortgage Loan. The Company shall give written notice to the Owner that such substitution has taken place and shall amend the Mortgage Loan Schedule to reflect the removal of such Deleted Mortgage Loan from the terms of this Agreement and the substitution of the Qualified Substitute Mortgage Loan. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller Company shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.013.01 and 3.02, except to the extent a representation contained in Section 3.02 and 3.03relates to an expressly specified percentage of the Mortgage Loans. For any month in which the applicable Seller Company substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller Company will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution is less than the aggregate Assumed Principal Balance of all such Deleted Mortgage Loans (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loanssubstitution). The amount of such shortfall shall be paid distributed by the applicable Seller Company in the month of substitution pursuant to Section 5.01. Accordingly, on the date of such substitution) by wire transfer of immediately available , the Company will deposit from its own funds directly into the Custodial Account an amount equal to the Purchaser’s Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) by wire transfer of immediately available funds directly to the Purchaser’s Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) to cure any breach amount of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trustshortfall.

Repurchase and Substitution. It is understood and agreed that the representations and warranties set forth in Sections 3.01, 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the Purchaser, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers or the Purchaser of a breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interestinterest within 30 days of its Due Date) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is reasonably determined by the Purchaser to cure such breach provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice to, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price, together with all expenses incurred by the Purchaser as a result of such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within the applicable cure period or such additional time, if any, as is reasonably determined by the Purchaser, then such Seller shall, at the direction of the Purchaser, repurchase the Defective Mortgage Loan at the applicable Repurchase Price. Notwithstanding anything to the contrary contained herein, if the first regularly scheduled payment of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 30 Business Days following the delivery of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) of Section 3.03 or any Deemed Material Breach Representation, the applicable Seller may, at the Purchaser’s its option and assuming that such Seller has a Qualified Substitute Mortgage Loan or Loans, rather than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan (“Deleted Mortgage Loan”) and substitute in its place a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for such Qualified Substitute Mortgage Loan or Loans the Legal Documents as are required by Section 2. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.01, 3.02 and 3.03. For any month in which the applicable Seller substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loans. The amount of such shortfall shall be paid by the applicable Seller on the date of such substitution) by wire transfer of immediately available funds directly to the Purchaser’s Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) 3.04 by wire transfer of immediately available funds directly to the Purchaser’s Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) 3.04 to cure any breach of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 9.01(1) to indemnify the Purchaser in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. In the event of a repurchase or substitution, the Seller shall, simultaneously with such repurchase or substitution, give written notice (by telecopier, electronically or otherwise) to the Purchaser that such repurchase or substitution has taken place, amend the related Mortgage Loan Schedule to reflect the withdrawal of the Deleted Mortgage Loan from this Agreement, and in the case of substitution, identify the Qualified Substitute Mortgage Loan(s) and amend the related Mortgage Loan Schedule to reflect the addition of such Qualified Substitute Mortgage Loan(s) this Agreement. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(33.03 (3) or 3.03(153.03(16) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trust.

Repurchase and Substitution. It is understood and agreed that the representations and warranties set forth in Sections 3.01, 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the Purchaser, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers or the Purchaser of a breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (a “"Defective Mortgage Loan”"; provided that “"Defective Mortgage Loan” " shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interestinterest within 30 days of its Due Date) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is reasonably determined by the Purchaser to cure such breach breach, provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice to, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price, together with all expenses incurred by the Purchaser as a result of such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within the applicable cure period or such additional time, if any, as is reasonably determined by the Purchaser, then such Seller shall, at the direction of the Purchaser, repurchase the Defective Mortgage Loan at the applicable Repurchase Price. Notwithstanding anything to the contrary contained herein, if the first regularly scheduled payment of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s 's Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) of Section 3.03 or any Deemed Material Breach Representation, the applicable Seller may, at the Purchaser’s its option and assuming that such Seller has a Qualified Substitute Mortgage Loan or Loans, rather than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan (“"Deleted Mortgage Loan”") and substitute in its place a Qualified Substitute Mortgage Loan or Loans, provided that no such substitution shall be effected after the Mortgage Loan has been conveyed as part of a Sale transaction as described in Section 3.05 hereof and no such substitution shall be effected more than 180 days after the related Funding Date. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for such Qualified Substitute Mortgage Loan or Loans -38- the Legal Documents as are required by Section 2. In the event of a repurchase or substitution, the Seller shall, simultaneously with such reassignment, give written notice (by telecopier, electronically or otherwise) to the Purchaser that such repurchase or substitution has taken place, amend the related Mortgage Loan Schedule to reflect the withdrawal of the Deleted Mortgage Loan from this Agreement, and, in the case of substitution, identify the Qualified Substitute Mortgage Loan(s) and amend the related Mortgage Loan Schedule to reflect the addition of such Qualified Substitute Mortgage Loan(s) to this Agreement. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.01, 3.02 and 3.03. The Seller shall effect such substitution by delivering to the Custodian for such Qualified Substitute Mortgage Loan the documents required by Section 2.03, with the Mortgage Note endorsed as required by Section 2.03. No substitution will be made in any calendar month after the Determination Date for such month. For any month in which the applicable Seller substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loans. The amount of such shortfall shall be paid by the applicable Seller on the date of such substitution) by wire transfer of immediately available funds directly to the Purchaser’s 's Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) 3.04 by wire transfer of immediately available funds directly to the Purchaser’s 's Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) 3.04 to cure any breach of such Seller’s 's representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s 's representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. The parties further agree that, in recognition of the Trust’s 's rights against PHH Cendant Mortgage with respect to the Mortgage Loans acquired by it from PHH Cendant Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Cendant Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(3) or 3.03(153.03(16) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trust.

Repurchase and Substitution. It is understood and agreed that the representations and warranties set forth in Sections 3.01, 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the Purchaser, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers or the Purchaser of a breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first first, second or third regularly scheduled payment of principal and interestinterest due to the Purchaser after the Closing Date within 30 days of its Due Date) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is reasonably determined by the Purchaser to cure such breach provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice to, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price, together with all expenses incurred by the Purchaser as a result of such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within the applicable cure period or such additional time, if any, as is reasonably determined by the Purchaser, then such Seller shall, at the direction of the Purchaser, repurchase the Defective Mortgage Loan at the applicable Repurchase Price. Notwithstanding anything to the contrary contained herein, if the first first, second or third regularly scheduled payment of principal and interest due to the Purchaser after the Closing Date under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 5 Business Days following the delivery of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) of Section 3.03 or any Deemed Material Breach Representation, the applicable Seller may, at the sole option of the Purchaser’s option , and assuming that such Seller has a Qualified Substitute Mortgage Loan or Loans, rather than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan (“Deleted Mortgage Loan”) and substitute in its place a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for such Qualified Substitute Mortgage Loan or Loans the Legal Documents as are required by Section 2. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.01, 3.02 and 3.03. For any month in which the applicable Seller substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loans. The amount of such shortfall shall be paid by the applicable Seller on the date of such substitution) by wire transfer of immediately available funds directly to the Purchaser’s Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) 3.04 by wire transfer of immediately available funds directly to the Purchaser’s Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) 3.04 to cure any breach of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. In the event of a repurchase or substitution, the Seller shall, simultaneously with such repurchase or substitution, give written notice (by telecopier, electronically or otherwise) to the Purchaser that such repurchase or substitution has taken place, amend the related Mortgage Loan Schedule to reflect the withdrawal of the Deleted Mortgage Loan from this Agreement, and in the case of substitution, identify the Qualified Substitute Mortgage Loan(s) and amend the related Mortgage Loan Schedule to reflect the addition of such Qualified Substitute Mortgage Loan(s) this Agreement. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(33.03 (3) or 3.03(153.03(16) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trust.

Repurchase and Substitution. It is understood and agreed that the The representations and warranties set forth in Sections 3.01, 3.01 and 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the PurchaserOwner, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment of Mortgage or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers Company or the Purchaser an Owner of a breach of any of the representations and warranties contained set forth in Sections 3.013.01 and 3.02 (notwithstanding the Company's lack of knowledge of such representation and warranty), 3.02 which breach materially and adversely affects the value of the Mortgage Loans or 3.03 that the interest of the Owner (or which materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser Owner in the related Mortgage Loan, Loan in the case of a representation or repre- sentation and warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from Upon the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller Company of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected , the Company shall use its best efforts to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is determined by the Purchaser to promptly cure such breach provided that the Seller has commenced curing or correcting in all material respects within 60 days, and, if such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice tocannot be cured during such time period, the applicable Seller of any breach of Company shall, at the representation and warranty set forth in paragraph (52) of Section 3.03Owner's option, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price. If any such breach shall involve any representation or warranty set forth in Section 3.01, together with all expenses incurred by the Purchaser as a result of and such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within 60 days of the applicable cure period earlier of either discovery by or notice to the Company of such additional timebreach, if any, as is determined by all the Purchaser, then such Seller Mortgage Loans shall, at the direction of Owner's option, be repurchased by the Purchaser, repurchase the Defective Mortgage Loan Company at the applicable Repurchase Price. Notwithstanding anything to ; provided, however, that in the contrary contained herein, if the first regularly scheduled payment event of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery breach of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) Section 3.01 that relates to less than all of Section 3.03 or any Deemed Material Breach Representationthe Mortgage Loans, the applicable Seller Company shall repurchase only the Mortgage Loans to which such breach relates. However, the Company may, at its option, replace a Mortgage Loan as to which a breach of representation of warranty has occurred as described in the Purchaser’s option foregoing sentences of this Section 3.03 and assuming that such Seller has substitute in its place with a Qualified Substitute Mortgage Loan or Loans, rather provided, however, that any such substitution shall be effected not later than 120 days after the related Closing Date. Any repurchase the of a Mortgage Loan as provided above, remove or Loans pursuant to the foregoing provisions of this Section 3.03 shall be accomplished by deposit in the Custodial Account of the amount of the Repurchase Price (after deducting therefrom any amounts received in respect of such repurchased Mortgage Loan (“Deleted Mortgage Loan”) or Loans and substitute being held in its place the Custodial Account for future distribution). The Company shall effect any substitution of a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for Custodian the documents as are required to be delivered by Section 2.03, with the Mortgage Note endorsed as required by Section 2.03. No substitution will be made in any calendar month after the Determination Date occurring in such month. The Company shall deposit in the Custodial Account the Monthly Payment less the Servicing Fee due on such Qualified Substitute Mortgage Loan or Loans in the Legal Documents as are required month following the date of such substitution. Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the month of substitution will be retained by Section 2the Company. For the month of substitution, distributions to the Owner will include the Monthly Payment due on such Deleted Mortgage Loan in the month of substitution, and the Company shall thereafter be entitled to retain all amounts subsequently received by the Company in respect of such Deleted Mortgage Loan. The Company shall give written notice to the Owner that such substitution has taken place and shall amend the Mortgage Loan Schedule to reflect the removal of such Deleted Mortgage Loan from the terms of this Agreement and the substitution of the Qualified Substitute Mortgage Loan. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller Company shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.013.01 and 3.02, except to the extent a representation contained in Section 3.02 and 3.03relates to an expressly specified percentage of the Mortgage Loans. For any month in which the applicable Seller Company substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller Company will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution is less than the aggregate Assumed Principal Balance of all such Deleted Mortgage Loans (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loanssubstitution). The amount of such shortfall shall be paid distributed by the applicable Seller Company in the month of substitution pursuant to Section 5.01. Accordingly, on the date of such substitution) by wire transfer of immediately available , the Company will deposit from its own funds directly into the Custodial Account an amount equal to the Purchaser’s Accountamount of such shortfall. Any In addition to such repurchase obligation, the Company shall indemnify the Owner for any expenses reasonably incurred by the Owner in enforcing its remedies hereunder in connection with any breach by the Company of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above any representation or warranty set forth in paragraph 3.04(3) by wire transfer of immediately available funds directly to the Purchaser’s Accountthis Agreement. It is understood and agreed that the obligations of a Seller (a) the Company set forth in this Section 3.04(3) 3.03 to cure any breach of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective a defective Mortgage Loan(s) Loan and (b) set forth in Section 9.01 to indemnify the Purchaser Owner as provided in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and this Section 3.03 shall constitute the sole remedies of the Purchaser Owner respecting a breach of such the foregoing representations and warranties. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trust.

Repurchase and Substitution. It is understood and agreed that the The representations and warranties set forth in Sections 3.01, 3.01 and 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the Purchaser, notwithstanding notwithstand-ing any restrictive or qualified endorsement on any Mortgage Note or Assignment of Mortgage or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers Seller or the an Purchaser of a breach of any of the representations and warranties contained set forth in Sections 3.013.01 and 3.02 (notwithstanding the Seller’s lack of knowledge of such representation and warranty), 3.02 which breach materially and adversely affects the value of the Mortgage Loans or 3.03 that the interest of the Purchaser (or which materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, Loan in the case of a representation or repre-sentation and warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period Within 90 days of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller of any breach of any of such breach, the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating Seller shall use its best efforts to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or promptly cure such breach. If breach in all material respects and, if such breach can ultimately cannot be cured but is not reasonably expected to be cured within the 60-during such 90 day period, then the applicable Seller shall have such additional time, if any, as is determined by the Purchaser to cure such breach provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding shall, at the abovePurchaser's option, (i) within thirty (30) days of the earlier of either discovery by, or notice to, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price. If any such breach shall involve any represent-ation or warranty set forth in Section 3.01, together with all expenses incurred by the Purchaser as a result of and such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within 90 days of the applicable cure period earlier of either discovery by or notice to the Seller of such additional timebreach, if any, as is determined by all the Purchaser, then such Seller Mortgage Loans shall, at the direction of Purchaser's option, be repurchased by the Purchaser, repurchase the Defective Mortgage Loan Seller at the applicable Repurchase Price. Notwithstanding anything to ; provided, however, that in the contrary contained herein, if the first regularly scheduled payment event of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery breach of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) Section 3.01 that relates to less than all of Section 3.03 or any Deemed Material Breach Representationthe Mortgage Loans, the applicable Seller shall repurchase only the Mortgage Loans to which such breach relates. However, the Seller may, at its option, replace a Mortgage Loan as to which a breach of representation of warranty has occurred as described in the Purchaser’s option foregoing sentences of this Section 3.03 and assuming that such Seller has substi-tute in its place with a Qualified Substitute Mortgage Loan or Loans, rather provided, however, that any such substitution shall be effected not later than 120 days after the Funding Date. Any repurchase the of a Mortgage Loan as provided above, remove or Loans pursuant to the foregoing provisions of this Section 3.03 shall be accomplished by deposit in the Custodial Account of the amount of the Repurchase Price (after deducting therefrom any amounts received in respect of such repurchased Mortgage Loan (“Deleted Mortgage Loan”) or Loans and substitute being held in its place the Custodi-al Account for future distribution). The Seller shall effect any substitution of a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for Custodian the documents as are required to be delivered by Section 2.03, with the Mortgage Note endorsed as required by Section 2.03. No substitution will be made in any calendar month after the Determination Date occurring in such month. The Seller shall deposit in the Custodial Account the Monthly Payment less the Servicing Fee due on such Qualified Substitute Mortgage Loan or Loans in the Legal Documents as are required month following the date of such substitution. Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the month of substitution will be retained by Section 2the Seller. For the month of substitution, distributions to the Purchaser will include the Monthly Payment due on such Deleted Mortgage Loan in the month of substitution, and the Seller shall thereafter be entitled to retain all amounts subsequently received by the Seller in respect of such Deleted Mortgage Loan. The Seller shall give written notice to the Purchaser that such substitution has taken place and shall amend the Mortgage Loan Schedule to reflect the removal of such Deleted Mortgage Loan from the terms of this Agreement and the substitu-tion of the Qualified Substitute Mortgage Loan. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitutionsubstitu-tion, the covenants, representations and warranties set forth in Sections 3.013.01 and 3.02, except to the extent a representation contained in Section 3.02 and 3.03relates to an expressly specified percentage of the Mortgage Loans. For any month in which the applicable Seller substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution is less than the aggregate Assumed Principal Balance of all such Deleted Mortgage Loans (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loanssubstitution). The amount of such shortfall shall be paid distributed by the applicable Seller in the month of substitution pursuant to Section 5.01. Accordingly, on the date of such substitution) by wire transfer of immediately available , the Seller will deposit from its own funds directly into the Custodial Account an amount equal to the Purchaser’s Account. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) by wire transfer of immediately available funds directly to the Purchaser’s Account. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) to cure any breach amount of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trustshortfall.

Repurchase and Substitution. It is understood and agreed that the The representations and warranties set forth in Sections 3.01, 3.01 and 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the PurchaserOwner, notwithstanding notwithstand-ing any restrictive or qualified endorsement on any Mortgage Note or Assignment of Mortgage or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers Company or the Purchaser an Owner of a breach of any of the representations and warranties contained set forth in Sections 3.013.01 and 3.02 (notwithstanding the Company’s lack of knowledge of such representation and warranty), 3.02 which breach materially and adversely affects the value of the Mortgage Loans or 3.03 that the interest of the Owner (or which materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser Owner in the related Mortgage Loan, Loan in the case of a representation or repre-sentation and warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from Upon the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller Company of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected , the Company shall use its best efforts to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is determined by the Purchaser to promptly cure such breach provided that the Seller has commenced curing or correcting in all material respects within 60 days, and, if such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice tocannot be cured during such time period, the applicable Seller of any breach of Company shall, at the representation and warranty set forth in paragraph (52) of Section 3.03Owner's option, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price. If any such breach shall involve any represent-ation or warranty set forth in Section 3.01, together with all expenses incurred by the Purchaser as a result of and such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within 60 days of the applicable cure period earlier of either discovery by or notice to the Company of such additional timebreach, if any, as is determined by all the Purchaser, then such Seller Mortgage Loans shall, at the direction of Owner's option, be repurchased by the Purchaser, repurchase the Defective Mortgage Loan Company at the applicable Repurchase Price. Notwithstanding anything to ; provided, however, that in the contrary contained herein, if the first regularly scheduled payment event of principal and interest due under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery breach of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) Section 3.01 that relates to less than all of Section 3.03 or any Deemed Material Breach Representationthe Mortgage Loans, the applicable Seller Company shall repurchase only the Mortgage Loans to which such breach relates. However, the Company may, at its option, replace a Mortgage Loan as to which a breach of representation of warranty has occurred as described in the Purchaser’s option foregoing sentences of this Section 3.03 and assuming that such Seller has substi-tute in its place with a Qualified Substitute Mortgage Loan or Loans, rather provided, however, that any such substitution shall be effected not later than 120 days after the related Closing Date. Any repurchase the of a Mortgage Loan as provided above, remove or Loans pursuant to the foregoing provisions of this Section 3.03 shall be accomplished by deposit in the Custodial Account of the amount of the Repurchase Price (after deducting therefrom any amounts received in respect of such repurchased Mortgage Loan (“Deleted Mortgage Loan”) or Loans and substitute being held in its place the Custodi-al Account for future distribution). The Company shall effect any substitution of a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for Custodian the documents as are required to be delivered by Section 2.03, with the Mortgage Note endorsed as required by Section 2.03. No substitution will be made in any calendar month after the Determination Date occurring in such month. The Company shall deposit in the Custodial Account the Monthly Payment less the Servicing Fee due on such Qualified Substitute Mortgage Loan or Loans in the Legal Documents as are required month following the date of such substitution. Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the month of substitution will be retained by Section 2the Company. For the month of substitution, distributions to the Owner will include the Monthly Payment due on such Deleted Mortgage Loan in the month of substitution, and the Company shall thereafter be entitled to retain all amounts subsequently received by the Company in respect of such Deleted Mortgage Loan. The Company shall give written notice to the Owner that such substitution has taken place and shall amend the Mortgage Loan Schedule to reflect the removal of such Deleted Mortgage Loan from the terms of this Agreement and the substitu-tion of the Qualified Substitute Mortgage Loan. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller Company shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitutionsubstitu-tion, the covenants, representations and warranties set forth in Sections 3.013.01 and 3.02, except to the extent a representation contained in Section 3.02 and 3.03relates to an expressly specified percentage of the Mortgage Loans. For any month in which the applicable Seller Company substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller Company will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution is less than the aggregate Assumed Principal Balance of all such Deleted Mortgage Loans (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loanssubstitution). The amount of such shortfall shall be paid distributed by the applicable Seller Company in the month of substitution pursuant to Section 5.01. Accordingly, on the date of such substitution) by wire transfer of immediately available , the Company will deposit from its own funds directly into the Custodial Account an amount equal to the Purchaser’s Accountamount of such shortfall. Any In addition to such repurchase obligation, the Company shall indemnify the Owner for any expenses reasonably incurred by the Owner in enforcing its remedies hereunder in connection with any breach by the Company of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above any representation or warranty set forth in paragraph 3.04(3) by wire transfer of immediately available funds directly to the Purchaser’s Accountthis Agreement. It is understood and agreed that the obligations of a Seller (a) the Company set forth in this Section 3.04(3) 3.03 to cure any breach of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective a defective Mortgage Loan(s) Loan and (b) set forth in Section 9.01 to indemnify the Purchaser Owner as provided in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and this Section 3.03 shall constitute the sole remedies of the Purchaser Owner respecting a breach of such the foregoing representations and warranties. The parties further agree that, in recognition of the Trust’s rights against PHH Mortgage with respect to the Mortgage Loans acquired by it from PHH Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trust.

Repurchase and Substitution. It is understood and agreed that the representations and warranties set forth in Sections 3.01, 3.01 and 3.02 and 3.03 shall survive the sale delivery of the Mortgage Loans to the Purchaser and shall inure to the benefit of the Purchaser, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment of Mortgage or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery (including receipt of notice to such effect from the Purchaser) by either of the Sellers Company or the Purchaser of a breach of any of the foregoing representations and warranties contained warranties, without regard to any limitation set forth in Sections 3.01such representation or warranty concerning the knowledge of the Company as to the facts stated therein, 3.02 or 3.03 that which materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related any Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the otherother parties. Unless permitted a greater period Within 90 days of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller Company of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating warranty, the Company shall use its best efforts to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is determined by the Purchaser to promptly cure such breach provided that the Seller has commenced curing or correcting in all material respects and, if such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice tocannot be cured, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller Company shall repurchase such Mortgage Loan at a price equal to (i) the Repurchase PriceStated Principal Balance of the Mortgage Loan, together with all expenses incurred by the Purchaser as a result of such repurchase and plus (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of interest on such Stated Principal Balance at the Mortgage Loan and Remittance Rate from the date to which interest has last been paid by the Mortgagor to the first day of the Purchaser therein. Each Seller hereby covenants and agrees with respect month in which such purchase price is to each Mortgage Loan conveyed by it that, if be distributed which purchase price shall be deposited in the Custodial Account on the next succeeding Determination Date (after deducting therefrom any breach relating thereto cannot be corrected or cured within the applicable cure period or such additional time, if any, as is determined by the Purchaser, then such Seller shall, at the direction of the Purchaser, repurchase the Defective Mortgage Loan at the applicable Repurchase Price. Notwithstanding anything to the contrary contained herein, if the first regularly scheduled payment of principal and interest due under any amounts received in respect of such repurchased Mortgage Loan has been delinquent more than 30 days, and being held in the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage LoanCustodial Account for future distribution). However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. Within 10 Business Days following the delivery of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) of Section 3.03 or any Deemed Material Breach Representation, the applicable Seller Company may, at the Purchaser’s its option and assuming that such Seller the Company has a Qualified Substitute Mortgage Loan or Loans, rather than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan (“"Deleted Mortgage Loan”") and substitute in its place a Qualified Substitute Mortgage Loan or Loans, provided, however, that (i) if the Purchaser exercises its rights under Section 2.05, the Company may not effect a substitution without the prior written consent of the Purchaser and (ii) any such substitution shall be effected not later than 120 days after the related Closing Date. If the applicable Seller Company has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective deficient Mortgage Loan. Any repurchase of a Mortgage Loan or Loans pursuant to the foregoing provisions of this Section 3.03 shall be accomplished by deposit in the Custodial Account of the amount of the repurchase price set forth above (after deducting therefrom any principal and interest amounts received in respect of such repurchased Mortgage Loan or Loans and being held in the Custodial Account for future distribution). As to any Deleted Mortgage Loan for which the applicable Seller Company substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller Company shall effect such substitution by delivering to the Purchaser or its designee Custodian for such Qualified Substitute Mortgage Loan or Loans the Legal Documents Mortgage Note, the Mortgage, the Assignment of Mortgage and such other documents and agreements as are required by Section 22.04, with the Mortgage Note endorsed as required by Section 2.04. No substitution will be made in any calendar month after the Determination Date for such month. The Company shall deposit in the Custodial Account the Monthly Payment less the Servicing Fee due on such Qualified Substitute Mortgage Loan or Loans in the month following the date of such substitution. Monthly Payments due with respect to Qualified Substitute Mortgage Loans in the month of substitution will be retained by the Company. For the month of substitution, distributions to the Purchaser will include the Monthly Payment less the Servicing Fee due on such Deleted Mortgage Loan or Loans in the month of substitution, and the Company shall thereafter be entitled to retain all amounts subsequently received by the Company in respect of such Deleted Mortgage Loan. The Company shall give written notice to the Purchaser that such substitution has taken place and shall amend the related Mortgage Loan Schedule to reflect the removal of such Deleted Mortgage Loan from the terms of this Agreement and the substitution of the Qualified Substitute Mortgage Loan or Loans. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller Company shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.01, 3.02 3.01 and 3.033.02. For any month in which the applicable Seller Company substitutes one or more Qualified Substitute Mortgage Loan or Loans for one or more Deleted Mortgage Loans, the applicable Seller Company will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance Stated Principal Balance of all such Deleted Mortgage Loans. The amount of such shortfall shall be paid distributed by the applicable Seller Company in the month of substitution pursuant to Section 5.01. Accordingly, on the date of such substitution) by wire transfer of immediately available , the Company will deposit from its own funds directly into the Custodial Account an amount equal to the Purchaser’s Accountamount of such shortfall. Any In addition to such cure, repurchase of and substitution obligation, the Company shall indemnify the Purchaser and hold it harmless against any losses, damages, penalties, fines, forfeitures, reasonable and necessary legal fees and related costs, judgments, and other costs and expenses resulting from any claim, demand, defense or assertion based on or grounded upon, or resulting from, a Defective Mortgage Loan required hereunder shall be accomplished by payment breach of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above Company's representations and warranties contained in paragraph 3.04(3) by wire transfer of immediately available funds directly to the Purchaser’s Accountthis Article III. It is understood and agreed that the obligations of a Seller (a) the Company set forth in this Section 3.04(3) 3.03 to cure any breach of such Seller’s representations or repurchase a defective Mortgage Loan and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser as provided in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and this Section 3.03 shall constitute the sole remedies of the Purchaser except as provided in the last paragraph of Section 3.03 respecting a breach of such the foregoing representations and warranties. The parties further agree that, in recognition Any cause of action against the Company relating to or arising out of the Trust’s rights against PHH breach of any representations and warranties made in Sections 3.01 or 3.02 shall accrue as to any Mortgage Loan upon (i) discovery of such breach by the Purchaser or notice thereof by the Company to the Purchaser, (ii) failure by the Company to cure such breach or repurchase such Mortgage Loan as specified above, and (iii) demand upon the Company by the Purchaser for all amounts payable in respect of such Mortgage Loan. In the event of a breach of the representation in Section 3.01(nn), the Company shall not have the right or obligation to cure, substitute or repurchase the affected Mortgage Loan but shall deposit in the Custodial Account, prior to the next succeeding Remittance Date, the amount of the Prepayment Charge indicated on the applicable part of the Mortgage Loan Schedule to be due from the Mortgagor in the circumstances; provided, however, that if a representation in addition to that set forth in Section 3.01(nn) is breached with respect to a Mortgage Loan or Mortgage Loans, the Company shall both deposit the applicable Prepayment Charge as provided in this paragraph and cure, substitute or repurchase the affected Mortgage Loan or Mortgage Loans acquired by it from PHH as provided in this Section 3.03. In the instance of a substitution, any prepayment charge available under the substitute Mortgage and conveyed Loan shall belong to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Mortgage to repurchase directly any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the TrustCompany.

Repurchase and Substitution. It is understood and agreed that the representations and warranties set forth in Sections 3.01, 3.02 and 3.03 shall survive the sale of the Mortgage Loans to the Purchaser and shall inure to the benefit of the Purchaser, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or Assignment or the examination of any Mortgage File and notwithstanding the fact that any such representation or warranty (other than the representation contained in clause (42) of Section 3.03 above) was made to the best of the Seller’s knowledgeFile. Upon discovery by either of the Sellers or the Purchaser of a breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan), the party discovering such breach shall give prompt written notice to the other. Unless permitted a greater period of time to cure as set forth in Section 2.04, the applicable Seller shall have a period of 60 days from the earlier of either discovery by or receipt of written notice from the Purchaser to the Seller of any breach of any of the representations and warranties contained in Sections 3.01, 3.02 or 3.03 that materially and adversely affects the interest of the Purchaser (or that materially and adversely affects the interests of the Purchaser in the related Mortgage Loan, in the case of a representation or warranty relating to a particular Mortgage Loan) (a “Defective Mortgage Loan”; provided that “Defective Mortgage Loan” shall also include (a) any Mortgage Loan treated or designated as such in accordance with Section 2.04 and (b) any Mortgage Loan regarding which the Mortgagor fails to make the first regularly scheduled payment of principal and interest) within which to correct or cure such breach. If such breach can ultimately be cured but is not reasonably expected to be cured within the 60-day period, then the applicable Seller shall have such additional time, if any, as is reasonably determined by the Purchaser to cure such breach provided that the Seller has commenced curing or correcting such breach and is diligently pursuing same. Notwithstanding the above, (i) within thirty (30) days of the earlier of either discovery by, or notice to, the applicable Seller of any breach of the representation and warranty set forth in paragraph (52) of Section 3.03, the applicable Seller shall repurchase such Mortgage Loan at the Repurchase Price, together with all expenses incurred by the Purchaser as a result of such repurchase and (ii) any breach of a Deemed Material Breach Representation shall automatically be deemed to materially and adversely affect the value of the Mortgage Loan and the interest of the Purchaser therein. Each Seller hereby covenants and agrees with respect to each Mortgage Loan conveyed by it that, if any breach relating thereto cannot be corrected or cured within the applicable cure period or such additional time, if any, as is reasonably determined by the Purchaser, then such Seller shall, at the direction of the Purchaser, repurchase the Defective Mortgage Loan at the applicable Repurchase Price. Notwithstanding anything to the contrary contained herein, if the first regularly scheduled payment of principal and interest due any Mortgage Loan or the first regularly scheduled payment due after the Funding Date under any Mortgage Loan has been delinquent more than 30 days, the Purchaser may, by written notice to the applicable Seller, require that the Seller repurchase the related Mortgage Loan. However, if the Seller provides evidence that the delinquency was due to a servicing setup error, no repurchase shall be required. For any Mortgage Loan purchased by the Purchaser that have been prepaid-in full within 30 days from the Funding Date (“Prepaid Loan”), the Seller shall repurchase the Mortgage Loan at the Repurchase price. Within 10 Business Days following the delivery of any such written notice from the Purchaser, the applicable Seller shall repurchase the specified Mortgage Loan by paying the Repurchase Price therefor by wire transfer of immediately available funds directly to the Purchaser’s Account, or as otherwise directed by the Purchaser. Notwithstanding the previous paragraph, with the exception of the representation and warranty set forth in paragraph (52) of Section 3.03 or any Deemed Material Breach Representation, the applicable Seller may, at the Purchaser’s option and assuming that such Seller has a Qualified Substitute Mortgage Loan or Loans, rather than repurchase the Mortgage Loan as provided above, remove such Mortgage Loan (“Deleted Mortgage Loan”) and substitute in its place a Qualified Substitute Mortgage Loan or Loans. If the applicable Seller has no Qualified Substitute Mortgage Loan, it shall repurchase the Defective Mortgage Loan. As to any Deleted Mortgage Loan for which the applicable Seller substitutes a Qualified Substitute Mortgage Loan or Loans, the applicable Seller shall effect such substitution by delivering to the Purchaser or its designee for such Qualified Substitute Mortgage Loan or Loans the Legal Documents as are required by Section 22 and an amended Mortgage Loan Schedule. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects, and the applicable Seller shall be deemed to have made with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the covenants, representations and warranties set forth in Sections 3.01, 3.02 and 3.03. For any month in which the applicable Seller substitutes one or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the applicable Seller will determine the amount (if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of the date of substitution (after application of scheduled principal payments due in the month of substitution which have been received or as to which an advance has been made) is less than the aggregate outstanding principal balance of all such Deleted Mortgage Loans. The amount of such shortfall shall be paid by the applicable Seller on the date of such substitution) by wire transfer of immediately available funds directly to the Purchaser’s Account, or as otherwise directed by the Purchaser. Any repurchase of a Defective Mortgage Loan required hereunder shall be accomplished by payment of the applicable Repurchase Price within 3 Business Days of expiration of the applicable time period referred to above in paragraph 3.04(3) by wire transfer of immediately available funds directly to the Purchaser’s Account, or as otherwise directed by the Purchaser. It is understood and agreed that the obligations of a Seller (a) set forth in this Section 3.04(3) to cure any breach of such Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 or to repurchase the Defective Mortgage Loan(s) and (b) set forth in Section 9.01 to indemnify the Purchaser in connection with any breach of a Seller’s representations and warranties contained in Sections 3.01, 3.02 and 3.03 shall constitute the sole remedies of the Purchaser respecting a breach of such representations and warranties. All costs of repurchase/substitution shall be borne by the Sellers. The parties further agree that, in recognition of the Trust’s rights against PHH Cendant Mortgage with respect to the Mortgage Loans acquired by it from PHH Cendant Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have the right to cause PHH Cendant Mortgage to repurchase directly and indemnify the Purchaser as set forth in section 9.01 with respect any Defective Mortgage Loan (other than as a result of a breach by the Trust of Section 3.03(33.03 (3) or 3.03(15) hereof, in which case the Purchaser shall have the right to cause the Trust to repurchase directly the Defective Mortgage Loan) acquired hereunder by the Purchaser from the Trust.