EX 99.14
Execution
FLOW INTERIM SERVICING AGREEMENT
between
▇▇▇▇▇▇ Brothers Bank, FSB,
Purchaser
and
MORTGAGE NETWORK, INC.,
Seller
Dated as of February 16, 2004
FIXED AND ADJUSTABLE RATE RESIDENTIAL MORTGAGE LOANS
Group No. 2004-FLOW
FLOW INTERIM SERVICING AGREEMENT
This Flow Interim Servicing Agreement (the "Agreement") is
entered into as of the 16th day of February, 2004, by and between MORTGAGE
NETWORK, INC. (the "Seller"), a Massachusetts corporation and ▇▇▇▇▇▇ BROTHERS
BANK, FSB, a federal savings bank (the "Purchaser").
WHEREAS, the Purchaser and Seller entered into a Flow Mortgage
Loan Purchase and Warranties Agreement dated as of the date hereof (the
"Purchase Agreement") pursuant to which the Purchaser shall purchase from time
to time from the Seller certain conventional, residential, fixed and adjustable
rate first and second lien mortgage loans (the "Mortgage Loans") delivered as
whole loans servicing released; and
WHEREAS, the Purchaser desires to have the Seller service each
Mortgage Loan Package (as defined in the Purchase Agreement) during the period
between the related Closing Date and the related Transfer Date (each such
period, an "Interim Period"), the Seller desires to service and administer the
Mortgage Loans on behalf of the Purchaser during the Interim Period, and the
parties desire to provide the terms and conditions of such interim servicing by
the Seller.
NOW, THEREFORE, in consideration of the mutual covenants made
herein and for other good and valuable consideration the sufficiency of which is
hereby acknowledged, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. All capitalized terms not otherwise defined
herein have the respective meanings set forth in the Purchase Agreement. The
following terms are defined as follows (except as otherwise agreed by the
parties).
Accepted Servicing Practices: With respect to any Mortgage
Loan, those mortgage servicing practices of prudent mortgage lending
institutions which service mortgage loans of the same type as such Mortgage Loan
in the jurisdiction where the related Mortgaged Property is located.
Agreement: This agreement between the Purchaser and the Seller
for the interim servicing and administration of the Mortgage Loans.
Custodial Account: The separate account or accounts created
and maintained pursuant to Section 2.04.
Condemnation Proceeds: All awards or settlements in respect of
a Mortgaged Property, whether permanent or temporary, partial or entire, by
exercise of the power of eminent domain or condemnation, to the extent not
required to be released to a Mortgagor in accordance with the terms of the
related Mortgage Loan Documents.
Eligible Investments: Any one or more of the obligations and
securities listed below which investment provides for a date of maturity not
later than the Remittance Date in each month:
(a) direct obligations of, and obligations fully guaranteed
by, the United States of America, or any agency or instrumentality of the United
States of America the obligations of which are backed by the full faith and
credit of the United States of America; and
(b) federal funds, demand and time deposits in, certificates
of deposits of, or bankers' acceptances issued by, any depository institution or
trust company incorporated or organized under the laws of the United States of
America or any state thereof and subject to supervision and examination by
federal and/or state banking authorities, so long as at the time of such
investment or contractual commitment providing for such investment the
commercial paper or other short-term debt obligations of such depository
institution or trust company (or, in the case of a depository institution or
trust company which is the principal subsidiary of a holding company, the
commercial paper or other short-term debt obligations of such holding company)
are rated "P-1" by ▇▇▇▇▇'▇ Investors Service, Inc. and the long-term debt
obligations of such holding company) are rated "P-1" by ▇▇▇▇▇'▇ Investors
Service, Inc. and the long-term debt obligations of such depository institution
or trust company (or, in the case of a depository institution or trust company
which is the principal subsidiary of a holding company, the long-term debt
obligations of such holding company) are rated at least "Aa" by ▇▇▇▇▇'▇
Investors Service, Inc.
provided, however, that no such instrument shall be an Eligible Investment if
such instrument evidences either (i) a right to receive only interest payments
with respect to the obligations underlying such instrument, or (ii) both
principal and interest payments derived from obligations underlying such
instrument and the principal and interest payments with respect to such
instrument provide a yield to maturity of greater than 120% of the yield to
maturity at par of such underlying obligations.
Escrow Account: The separate account or accounts created and
maintained pursuant to Section 2.06.
Escrow Payment: With respect to any Mortgage Loan, the amounts
constituting ground rents, taxes, assessments, water rates, sewer rents,
municipal charges, mortgage insurance premiums, fire and hazard insurance
premiums, condominium charges, and any other payments required to be escrowed by
the Mortgagor with the mortgagee pursuant to the Mortgage or any other document.
Event of Default: Any one of the conditions or circumstances
enumerated in Section 11.01.
Fidelity Bond: A fidelity bond to be maintained by the Seller
pursuant to Section 2.13.
▇▇▇▇▇▇ Mae Guides: The ▇▇▇▇▇▇ ▇▇▇ Selling Guide and the ▇▇▇▇▇▇
Mae Servicing Guide and all amendments or additions thereto.
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Insurance Proceeds: With respect to each Mortgage Loan,
proceeds of insurance policies insuring the Mortgage Loan or the related
Mortgaged Property.
Interim Period: With respect to each Mortgage Loan Package,
the period between the related Closing Date and the related Transfer Date.
Liquidation Proceeds: Cash received in connection with the
liquidation of a defaulted Mortgage Loan, whether through the sale or assignment
of such Mortgage Loan, trustee's sale, foreclosure sale or otherwise, or the
sale of the related Mortgaged Property if the Mortgaged Property is acquired in
satisfaction of the Mortgage Loan.
Master Servicer: Shall have the meaning set forth in Section
12.10.
Mortgage Impairment Insurance Policy: A mortgage impairment or
blanket hazard insurance policy as described in Section 2.12.
Mortgage Loan Remittance Rate: With respect to each Mortgage
Loan, the annual rate of interest remitted to the Purchaser, which shall be
equal to the Mortgage Interest Rate minus the Servicing Fee.
Prime Rate: The prime rate announced to be in effect from time
to time, as published as the average rate in The Wall Street Journal.
Purchase Agreement: The Flow Mortgage Loan Purchase and
Warranties Agreement between the Purchaser and the Seller related to the
purchase of the Mortgage Loans dated as of February 16, 2004.
Qualified Depository: A depository the accounts of which are
insured by the FDIC through the BIF or the SAIF and the debt obligations of
which are rated AA or better by Standard & Poor's, A Division of The McGraw Hill
Companies.
Remittance Date: The 10th day (or if such 10th day is not a
Business Day, the first Business Day immediately preceding) of any month.
REO Disposition: The final sale by the Seller of any REO
Property.
REO Disposition Proceeds: All amounts received with respect to
an REO Disposition pursuant to Section 2.17.
REO Property: A Mortgaged Property acquired by the Seller on
behalf of the Purchaser through foreclosure or by deed in lieu of foreclosure,
as described in Section 2.17.
SAIF: The Savings Association Insurance Fund, or any successor
thereto.
Servicing Advances: All customary, reasonable and necessary
"out of pocket" costs and expenses (including reasonable attorneys' fees and
disbursements) incurred in the performance by the Seller of its servicing
obligations, including, but not limited to, the cost of (a) the preservation,
restoration and protection of the Mortgaged Property, (b) any enforcement or
judicial proceedings, including foreclosures, (c) the management and liquidation
of the Mortgaged Property if the Mortgaged Property is acquired in satisfaction
of the Mortgage and (d) compliance with the obligations under Section 2.08.
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Servicing Fee: With respect to each Mortgage Loan, an amount
equal to $14.00 per month (unless otherwise set forth in the related Purchase
Price and Terms Agreement). Such fee shall be payable monthly and shall be pro
rated for any portion of a month during which the Mortgage Loan is serviced
pursuant to this Agreement. The obligation of the Purchaser to pay the Servicing
Fee is limited to, and the Servicing Fee is payable solely from, the interest
portion (including recoveries with respect to interest from Liquidation
Proceeds, to the extent permitted by Section 2.05) of such Monthly Payment
collected by the Seller, or as otherwise provided under Section 2.05.
Servicing File: With respect to each Mortgage Loan, the file
retained by the Seller consisting of originals of all documents in the Mortgage
File which are not delivered to the Purchaser and copies of the Mortgage Loan
Documents listed on Exhibit B to the Purchase Agreement.
Servicing Officer: Any officer of the Seller involved in or
responsible for, the administration and servicing of the Mortgage Loans whose
name appears on a list of servicing officers furnished by the Seller to the
Purchaser upon request, as such list may from time to time be amended.
ARTICLE II
SERVICING
Section 2.01 Seller to Act as Servicer. The Seller, as an independent
contractor, shall service and administer the Mortgage Loans and shall have full
power and authority, acting alone, to do any and all things in connection with
such servicing and administration which the Seller may deem necessary or
desirable, consistent with the terms of this Agreement and with Accepted
Servicing Practices.
Consistent with the terms of this Agreement, the Seller may
waive, modify or vary any term of any Mortgage Loan or consent to the
postponement of strict compliance with any such term or in any manner grant
indulgence to any Mortgagor if in the Seller's reasonable and prudent
determination such waiver, modification, postponement or indulgence is not
materially adverse to the Purchaser, provided, however, that unless the Seller
has obtained the prior written consent of the Purchaser, the Seller shall not
permit any modification with respect to any Mortgage Loan that would change the
Mortgage Interest Rate, defer or forgive the payment of principal or interest,
reduce or increase the outstanding principal balance (except for actual payments
of principal) or change the final maturity date on such Mortgage Loan. In the
event of any such modification which permits the deferral of interest or
principal payments on any Mortgage Loan, the Seller shall, on the Business Day
immediately preceding the Remittance Date in any month in which any such
principal or interest payment has been deferred, deposit in the Custodial
Account from its own funds, in accordance with Section 2.04, the difference
between (a) such month's principal and one month's interest at the Mortgage Loan
Remittance Rate on the unpaid principal balance of such Mortgage Loan and (b)
the amount paid by the Mortgagor. The Seller shall be entitled to reimbursement
for such advances to the same extent as for all other advances made pursuant to
Section 2.05. Without limiting the generality of the foregoing, the Seller shall
continue, and is hereby authorized and empowered, to execute and deliver on
behalf of itself and the Purchaser, all instruments of satisfaction or
cancellation, or of partial or full release, discharge and all other comparable
instruments, with respect to the Mortgage Loans and with respect to the
Mortgaged Properties. If reasonably required by the Seller, the Purchaser shall
furnish the Seller with any powers of attorney and other documents necessary or
appropriate to enable the Seller to carry out its servicing and administrative
duties under this Agreement.
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In servicing and administering the Mortgage Loans, the Seller
shall employ procedures (including collection procedures) and exercise the same
care that it customarily employs and exercises in servicing and administering
similar mortgage loans for its own account, giving due consideration to Accepted
Servicing Practices where such practices do not conflict with the requirements
of this Agreement, and the Purchaser's reliance on the Seller.
Section 2.02 Liquidation of Mortgage Loans. In the event that any
payment due under any Mortgage Loan and not postponed pursuant to Section 2.01
is not paid when the same becomes due and payable, or in the event the Mortgagor
fails to perform any other covenant or obligation under the Mortgage Loan and
such failure continues beyond any applicable grace period, the Seller shall take
such action as (a) the Seller would take under similar circumstances with
respect to a similar mortgage loan held for its own account for investment, (b)
shall be consistent with Accepted Servicing Practices and (c) the Seller shall
determine prudently to be in the best interest of Purchaser. In the event that
any payment due under any Mortgage Loan is not postponed pursuant to Section
2.01 and remains delinquent for a period of 90 days or any other default
continues for a period of 90 days beyond the expiration of any grace or cure
period, the Seller shall commence foreclosure proceedings, provided that, prior
to commencing foreclosure proceedings, the Seller shall notify the Purchaser in
writing of the Seller's intention to do so, and the Seller shall not commence
foreclosure proceedings if the Purchaser objects to such action within 10
Business Days of receiving such notice. In such connection, the Seller shall
from its own funds make all necessary and proper Servicing Advances, provided,
however, that the Seller shall not be required to expend its own funds in
connection with any foreclosure or towards the restoration or preservation of
any Mortgaged Property, unless it shall determine (a) that such preservation,
restoration and/or foreclosure will increase the proceeds of liquidation of the
Mortgage Loan to Purchaser after reimbursement to itself for such expenses and
(b) that such expenses will be recoverable by it either through Liquidation
Proceeds (respecting which it shall have priority for purposes of withdrawals
from the Custodial Account pursuant to Section 2.05) or through Insurance
Proceeds (respecting which it shall have similar priority).
Section 2.03 Collection of Mortgage Loan Payments. Continuously from
the date hereof until the Transfer Date the Seller shall proceed diligently to
collect all payments due under each of the Mortgage Loans when the same shall
become due and payable and shall take special care in ascertaining and
estimating Escrow Payments and all other charges that will become due and
payable with respect to the Mortgage Loans and each related Mortgaged Property,
to the end that the installments payable by the Mortgagors will be sufficient to
pay such charges as and when they become due and payable.
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Section 2.04 Establishment of and Deposits to Custodial Account. The
Seller shall segregate and hold all funds collected and received pursuant to the
Mortgage Loans separate and apart from any of its own funds and general assets
and shall establish and maintain one or more Custodial Accounts, in the form of
time deposit or demand accounts, titled "Mortgage Network, Inc. in trust for
▇▇▇▇▇▇ Brothers Bank, FSB, Residential Adjustable Rate Mortgage Loans, Group No.
2004-FLOW". The Custodial Account shall be established with a Qualified
Depository acceptable to the Purchaser. Any funds deposited in the Custodial
Account shall at all times be fully insured to the full extent permitted under
applicable law. Funds deposited in the Custodial Account may be drawn on by the
Seller in accordance with Section 2.05. The creation of any Custodial Account
shall be evidenced by a certification in the form of Exhibit 1 hereto, in the
case of an account established with the Seller, or by a letter agreement in the
form of Exhibit 2 hereto, in the case of an account held by a depository other
than the Seller. A copy of such certification or letter agreement shall be
furnished to the Purchaser and, upon request, to any subsequent Purchaser.
The Seller shall deposit in the Custodial Account on a daily
basis, and retain therein, the following collections received by the Seller
after the Cut-off Date:
(i) all payments on account of principal on the Mortgage
Loans;
(ii) all payments on account of interest on the Mortgage
Loans adjusted to the Mortgage Loan Remittance Rate;
(iii) all Liquidation Proceeds;
(iv) all Insurance Proceeds including amounts required
to be deposited pursuant to Section 2.11 (other than proceeds to be
held in the Escrow Account and applied to the restoration or repair of
the Mortgaged Property or released to the Mortgagor in accordance with
Section 2.15), Section 2.12 and Section 2.16;
(v) all Condemnation Proceeds which are not applied to
the restoration or repair of the Mortgaged Property or released to the
Mortgagor in accordance with Section 2.15;
(vi) any amount required to be deposited in the
Custodial Account pursuant to Section 2.01, 2.10, 2.17, 4.01 or 4.02;
(vii) any amounts payable in connection with the
repurchase of any Mortgage Loan pursuant to Section 8 of the Purchase
Agreement; and
(viii) any amounts required to be deposited by the
Seller pursuant to Section 2.11 in connection with the deductible
clause in any blanket hazard insurance policy.
The foregoing requirements for deposit into the Custodial
Account shall be exclusive, it being understood and agreed that, without
limiting the generality of the foregoing, payments in the nature of late payment
charges and assumption fees, to the extent permitted by Section 4.01, need not
be deposited by the Seller into the Custodial Account. Any interest paid on
funds deposited in the Custodial Account by the depository institution shall
accrue to the benefit of the Seller and the Seller shall be entitled to retain
and withdraw such interest from the Custodial Account pursuant to Section 2.05.
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Section 2.05 Permitted Withdrawals From Custodial Account. The Seller
shall, from time to time, withdraw funds from the Custodial Account for the
following purposes:
(i) to make payments to the Purchaser in the amounts and
in the manner provided for in Section 3.01;
(ii) to reimburse itself for unreimbursed Servicing
Advances, any unpaid Servicing Fees and for unreimbursed advances of
Seller funds made pursuant to Section 2.17, the Seller's right to
reimburse itself pursuant to this subclause (ii) with respect to any
Mortgage Loan being limited to related Liquidation Proceeds,
Condemnation Proceeds, Insurance Proceeds and such other amounts as may
be collected by the Seller from the Mortgagor or otherwise relating to
the Mortgage Loan, it being understood that, in the case of any such
reimbursement, the Seller's right thereto shall be prior to the rights
of the Purchaser except that, where the Seller is required to
repurchase a Mortgage Loan pursuant to Section 8 of the Purchase
Agreement or Section 4.02 of this Agreement, the Seller's right to such
reimbursement shall be subsequent to the payment to the Purchaser of
the Repurchase Price pursuant to such sections and all other amounts
required to be paid to the Purchaser with respect to such Mortgage
Loan;
(iii) to pay itself interest on funds deposited in the
Custodial Account;
(iv) to reimburse itself for expenses incurred and
reimbursable to it pursuant to Section 4.03;
(v) to clear and terminate the Custodial Account upon
the termination of this Agreement; and
(vi) to withdraw funds deposited in error.
In the event that the Custodial Account is interest bearing,
on each Remittance Date, the Seller shall withdraw all funds from the Custodial
Account except for those amounts which, pursuant to Section 3.01, the Seller is
not obligated to remit on such Remittance Date. The Seller may use such
withdrawn funds only for the purposes described in this Section 2.05.
Section 2.06 Establishment of and Deposits to Escrow Account. The
Seller shall segregate and hold all funds collected and received pursuant to a
Mortgage Loan constituting Escrow Payments separate and apart from any of its
own funds and general assets and shall establish and maintain one or more Escrow
Accounts, in the form of time deposit or demand accounts, titled, "Mortgage
Network, Inc., in trust for ▇▇▇▇▇▇ Brothers Bank, FSB, Residential Fixed and
Adjustable Rate Mortgage Loans, Group No. 2004-FLOW, and various Mortgagors".
The Escrow Accounts shall be established with a Qualified Depository, in a
manner which shall provide maximum available insurance thereunder. Funds
deposited in the Escrow Account may be drawn on by the Seller in accordance with
Section 2.07. The creation of any Escrow Account shall be evidenced by a
certification in the form of Exhibit 3 hereto, in the case of an account
established with the Seller, or by a letter agreement in the form of Exhibit 4
hereto, in the case of an account held by a depository other than the Seller. A
copy of such certification shall be furnished to the Purchaser and, upon
request, to any subsequent Purchaser.
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The Seller shall deposit in the Escrow Account or Accounts on
a daily basis, and retain therein:
(i) all Escrow Payments collected on account of the
Mortgage Loans, for the purpose of effecting timely payment of any such
items as required under the terms of this Agreement; and
(ii) all amounts representing Insurance Proceeds or
Condemnation Proceeds which are to be applied to the restoration or
repair of any Mortgaged Property.
The Seller shall make withdrawals from the Escrow Account only
to effect such payments as are required under this Agreement, as set forth in
Section 2.07. The Seller shall be entitled to retain any interest paid on funds
deposited in the Escrow Account by the depository institution, other than
interest on escrowed funds required by law to be paid to the Mortgagor. To the
extent required by law, the Seller shall pay interest on escrowed funds to the
Mortgagor notwithstanding that the Escrow Account may be non-interest bearing or
that interest paid thereon is insufficient for such purposes.
Section 2.07 Permitted Withdrawals From Escrow Account. Withdrawals
from the Escrow Account or Accounts may be made by the Seller only:
(i) to effect timely payments of ground rents, taxes,
assessments, water rates, mortgage insurance premiums, condominium
charges, fire and hazard insurance premiums or other items constituting
Escrow Payments for the related Mortgage;
(ii) to reimburse the Seller for any Servicing Advance
made by the Seller pursuant to Section 2.08 with respect to a related
Mortgage Loan, but only from amounts received on the related Mortgage
Loan which represent late collections of Escrow Payments thereunder;
(iii) to refund to any Mortgagor any funds found to be
in excess of the amounts required under the terms of the related
Mortgage Loan;
(iv) for transfer to the Custodial Account and
application to reduce the principal balance of the Mortgage Loan in
accordance with the terms of the related Mortgage and Mortgage Note;
(v) for application to restoration or repair of the
Mortgaged Property in accordance with the procedures outlined in
Section 2.15;
(vi) to pay to the Seller, or any Mortgagor to the
extent required by law, any interest paid on the funds deposited in the
Escrow Account;
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(vii) to clear and terminate the Escrow Account on the
termination of this Agreement; and
(viii) to withdraw funds deposited in error.
Section 2.08 Payment of Taxes, Insurance and Other Charges. With
respect to each Mortgage Loan, the Seller shall maintain accurate records
reflecting the status of ground rents, taxes, assessments, water rates, sewer
rents, and other charges which are or may become a lien upon the Mortgaged
Property and the status of fire and hazard insurance coverage and shall obtain,
from time to time, all bills for the payment of such charges (including renewal
premiums) and shall effect payment thereof prior to the applicable penalty or
termination date, employing for such purpose deposits of the Mortgagor in the
Escrow Account which shall have been estimated and accumulated by the Seller in
amounts sufficient for such purposes, as allowed under the terms of the
Mortgage. To the extent that a Mortgage does not provide for Escrow Payments,
the Seller shall determine that any such payments are made by the Mortgagor at
the time they first become due. The Seller assumes full responsibility for the
timely payment of all such bills and shall effect timely payment of all such
charges irrespective of each Mortgagor's faithful performance in the payment of
same or the making of the Escrow Payments, and the Seller shall make advances
from its own funds to effect such payments.
Section 2.09 Reserved.
Section 2.10 Protection of Accounts. The Seller may transfer the
Custodial Account or the Escrow Account to a different Qualified Depository from
time to time. Such transfer shall be made only upon obtaining the consent of the
Purchaser, which consent shall not be withheld unreasonably.
The Seller shall bear any expenses, losses or damages
sustained by the Purchaser because the Custodial Account and/or the Escrow
Account are not demand deposit accounts.
Amounts on deposit in the Custodial Account and the Escrow
Account may at the option of the Seller be invested in Eligible Investments;
provided that in the event that amounts on deposit in the Custodial Account or
the Escrow Account exceed the amount fully insured by the FDIC (the "Insured
Amount") the Seller shall be obligated to invest the excess amount over the
Insured Amount in Eligible Investments on the same Business Day as such excess
amount becomes present in the Custodial Account or the Escrow Account. Any such
Eligible Investment shall mature no later than the Determination Date next
following the date of such Eligible Investment, provided, however, that if such
Eligible Investment is an obligation of a Qualified Depository (other than the
Seller) that maintains the Custodial Account or the Escrow Account, then such
Eligible Investment may mature on such Remittance Date. Any such Eligible
Investment shall be made in the name of the Seller in trust for the benefit of
the Purchaser. All income on or gain realized from any such Eligible Investment
shall be for the benefit of the Seller and may be withdrawn at any time by the
Seller. Any losses incurred in respect of any such investment shall be deposited
in the Custodial Account or the Escrow Account, by the Seller out of its own
funds immediately as realized.
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Section 2.11 Maintenance of Hazard Insurance. The Seller shall cause to
be maintained for each Mortgage Loan, hazard insurance such that all buildings
upon the Mortgaged Property are insured by a generally acceptable insurer rated
A:VI or better in the current Best's Key Rating Guide ("Best's") against loss by
fire, hazards of extended coverage and such other hazards as are customary in
the area where the Mortgaged Property is located, in an amount which is at least
equal to the lesser of (a) the maximum insurable value of the improvements
securing such Mortgage Loan and (b) the greater of (i) the outstanding principal
balance of the Mortgage Loan and (ii) an amount such that the proceeds thereof
shall be sufficient to prevent the Mortgagor or the loss payee from becoming a
co-insurer.
If upon origination of the Mortgage Loan, the related
Mortgaged Property was located in an area identified in the Federal Register by
the Federal Emergency Management Agency as having special flood hazards (and
such flood insurance has been made available) a flood insurance policy meeting
the requirements of the current guidelines of the Federal Insurance
Administration is in effect with a generally acceptable insurance carrier rated
A:VI or better in Best's in an amount representing coverage equal to the lesser
of (a) the minimum amount required, under the terms of coverage, to compensate
for any damage or loss on a replacement cost basis (or the unpaid balance of the
mortgage if replacement cost coverage is not available for the type of building
insured) and (b) the maximum amount of insurance which is available under the
Flood Disaster Protection Act of 1973, as amended. If at any time during the
term of the Mortgage Loan, the Seller determines in accordance with applicable
law and pursuant to the ▇▇▇▇▇▇ ▇▇▇ Guides that a Mortgaged Property is located
in a special flood hazard area and is not covered by flood insurance or is
covered in an amount less than the amount required by the Flood Disaster
Protection Act of 1973, as amended, the Seller shall notify the related
Mortgagor that the Mortgagor must obtain such flood insurance coverage, and if
said Mortgagor fails to obtain the required flood insurance coverage within
forty-five (45) days after such notification, the Seller shall immediately force
place the required flood insurance on the Mortgagor's behalf.
If a Mortgage is secured by a unit in a condominium project,
the Seller shall verify that the coverage required of the owner's association,
including hazard, flood, liability, and fidelity coverage, is being maintained
in accordance with then current ▇▇▇▇▇▇ ▇▇▇ requirements, and secure from the
owner's association its agreement to notify the Seller promptly of any change in
the insurance coverage or of any condemnation or casualty loss that may have a
material effect on the value of the Mortgaged Property as security.
The Seller shall cause to be maintained on each Mortgaged
Property earthquake or such other or additional insurance as may be required
pursuant to such applicable laws and regulations as shall at any time be in
force and as shall require such additional insurance, or pursuant to the
requirements of any private mortgage guaranty insurer, or as may be required to
conform with Accepted Servicing Practices.
In the event that the Purchaser or the Seller shall determine
that the Mortgaged Property should be insured against loss or damage by hazards
and risks not covered by the insurance required to be maintained by the
Mortgagor pursuant to the terms of the Mortgage, the Seller shall communicate
and consult with the Mortgagor with respect to the need for such insurance and
bring to the Mortgagor's attention the desirability of protection of the
Mortgaged Property.
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All policies required hereunder shall name the Seller as loss
payee and shall be endorsed with standard or New York mortgagee clauses, without
contribution, which shall provide for at least 30 days prior written notice of
any cancellation, reduction in amount or material change in coverage.
The Seller shall not interfere with the Mortgagor's freedom of
choice in selecting either his insurance carrier or agent, provided, however,
that the Seller shall not accept any such insurance policies from insurance
companies unless such companies are rated A:VI or better in Best's and are
licensed to do business in the jurisdiction in which the Mortgaged Property is
located. The Seller shall determine that such policies provide sufficient risk
coverage and amounts, that they insure the property owner, and that they
properly describe the property address. The Seller shall furnish to the
Mortgagor a formal notice of expiration of any such insurance in sufficient time
for the Mortgagor to arrange for renewal coverage by the expiration date.
Pursuant to Section 2.04, any amounts collected by the Seller
under any such policies (other than amounts to be deposited in the Escrow
Account and applied to the restoration or repair of the related Mortgaged
Property, or property acquired in liquidation of the Mortgage Loan, or to be
released to the Mortgagor, in accordance with the Seller's normal servicing
procedures as specified in Section 2.15) shall be deposited in the Custodial
Account subject to withdrawal pursuant to Section 2.05.
Section 2.12 Maintenance of Mortgage Impairment Insurance. In the event
that the Seller shall obtain and maintain a blanket policy insuring against
losses arising from fire and hazards covered under extended coverage on all of
the Mortgage Loans, then, to the extent such policy provides coverage in an
amount equal to the amount required pursuant to Section 2.11 and otherwise
complies with all other requirements of Section 2.11, it shall conclusively be
deemed to have satisfied its obligations as set forth in Section 2.11. Any
amounts collected by the Seller under any such policy relating to a Mortgage
Loan shall be deposited in the Custodial Account subject to withdrawal pursuant
to Section 2.05. Such policy may contain a deductible clause, in which case, in
the event that there shall not have been maintained on the related Mortgaged
Property a policy complying with Section 2.11, and there shall have been a loss
which would have been covered by such policy, the Seller shall deposit in the
Custodial Account at the time of such loss the amount not otherwise payable
under the blanket policy because of such deductible clause, such amount to be
deposited from the Seller's funds, without reimbursement therefor. Upon request
of the Purchaser, the Seller shall cause to be delivered to the Purchaser a
certified true copy of such policy and a statement from the insurer thereunder
that such policy shall in no event be terminated or materially modified without
30 days' prior written notice to the Purchaser.
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Section 2.13 Maintenance of Fidelity Bond and Errors and Omissions
Insurance. The Seller shall maintain with responsible companies, at its own
expense, a blanket Fidelity Bond and an Errors and Omissions Insurance Policy,
with broad coverage on all officers, employees or other persons acting in any
capacity requiring such persons to handle funds, money, documents or papers
relating to the Mortgage Loans ("Seller Employees"). Any such Fidelity Bond and
Errors and Omissions Insurance Policy shall be in the form of the Mortgage
Banker's Blanket Bond and shall protect and insure the Seller against losses,
including forgery, theft, embezzlement, fraud, errors and omissions and
negligent acts of such Seller Employees. Such Fidelity Bond and Errors and
Omissions Insurance Policy also shall protect and insure the Seller against
losses in connection with the release or satisfaction of a Mortgage Loan without
having obtained payment in full of the indebtedness secured thereby. No
provision of this Section 2.13 requiring such Fidelity Bond and Errors and
Omissions Insurance Policy shall diminish or relieve the Seller from its duties
and obligations as set forth in this Agreement. The minimum coverage under any
such bond and insurance policy shall be at least equal to the corresponding
amounts required by ▇▇▇▇▇▇ Mae in the ▇▇▇▇▇▇ ▇▇▇ Guides or by ▇▇▇▇▇▇▇ Mac in the
▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇' & Servicers' Guide. Upon the request of the Purchaser, the
Seller shall cause to be delivered to the Purchaser a certified true copy of
such fidelity bond and insurance policy and a statement from the surety and the
insurer that such fidelity bond and insurance policy shall in no event be
terminated or materially modified without 30 days' prior written notice to the
Purchaser.
Section 2.14 Inspections. The Seller shall inspect the Mortgaged
Property as often as deemed necessary by the Seller to assure itself that the
value of the Mortgaged Property is being preserved. In addition, if any Mortgage
Loan is more than 60 days delinquent, the Seller immediately shall inspect the
Mortgaged Property and shall conduct subsequent inspections in accordance with
Accepted Servicing Practices. The Seller shall keep a written report of each
such inspection.
Section 2.15 Restoration of Mortgaged Property. The Seller need not
obtain the approval of the Purchaser prior to releasing any Insurance Proceeds
or Condemnation Proceeds to the Mortgagor to be applied to the restoration or
repair of the Mortgaged Property if such release is in accordance with Accepted
Servicing Practices. At a minimum, the Seller shall comply with the following
conditions in connection with any such release of Insurance Proceeds or
Condemnation Proceeds:
(i) the Seller shall receive satisfactory independent
verification of completion of repairs and issuance of any required
approvals with respect thereto;
(ii) the Seller shall take all steps necessary to
preserve the priority of the lien of the Mortgage, including, but not
limited to requiring waivers with respect to mechanics' and
materialmen's liens;
(iii) the Seller shall verify that the Mortgage Loan is
not in default; and
(iv) pending repairs or restoration, the Seller shall
place the Insurance Proceeds or Condemnation Proceeds in the Escrow
Account.
If the Purchaser is named as an additional loss payee, the
Seller is hereby empowered to endorse any loss draft issued in respect of such a
claim in the name of the Purchaser.
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Section 2.16 Reserved.
Section 2.17 Title, Management and Disposition of REO Property. In the
event that title to any Mortgaged Property is acquired in foreclosure or by deed
in lieu of foreclosure, the deed or certificate of sale shall be taken in the
name of the Purchaser, or in the event the Purchaser is not authorized or
permitted to hold title to real property in the state where the REO Property is
located, or would be adversely affected under the "doing business" or tax laws
of such state by so holding title, the deed or certificate of sale shall be
taken in the name of such Person or Persons as shall be consistent with an
Opinion of Counsel obtained by the Seller from any attorney duly licensed to
practice law in the state where the REO Property is located. The Person or
Persons holding such title other than the Purchaser shall acknowledge in writing
that such title is being held as nominee for the Purchaser.
The Seller shall manage, conserve, protect and operate each
REO Property for the Purchaser solely for the purpose of its prompt disposition
and sale. The Seller, either itself or through an agent selected by the Seller,
shall manage, conserve, protect and operate the REO Property in the same manner
that it manages, conserves, protects and operates other foreclosed property for
its own account, and in the same manner that similar property in the same
locality as the REO Property is managed. The Seller shall attempt to sell the
same (and may temporarily rent the same for a period not greater than one year,
except as otherwise provided below) on such terms and conditions as the Seller
deems to be in the best interest of the Purchaser.
The Seller shall use its best efforts to dispose of the REO
Property as soon as possible and shall sell such REO Property in any event
within one year after title has been taken to such REO Property, unless the
Seller determines, and gives an appropriate notice to the Purchaser to such
effect, that a longer period is necessary for the orderly liquidation of such
REO Property. If a period longer than one year is permitted under the foregoing
sentence and is necessary to sell any REO Property, (a) the Seller shall report
monthly to the Purchaser as to the progress being made in selling such REO
Property and (b) if, with the written consent of the Purchaser, a purchase money
mortgage is taken in connection with such sale, such purchase money mortgage
shall name the Seller as mortgagee, and such purchase money mortgage shall not
be held pursuant to this Agreement, but instead a separate participation
agreement among the Seller and Purchaser shall be entered into with respect to
such purchase money mortgage.
The Seller shall also maintain on each REO Property fire and
hazard insurance with extended coverage in an amount which is at least equal to
the maximum insurable value of the improvements which are a part of such
property, liability insurance and, to the extent required and available under
the Flood Disaster Protection Act of 1973, as amended, flood insurance in the
amount required above.
The disposition of REO Property shall be carried out by the
Seller at such price, and upon such terms and conditions, as the Seller deems to
be in the best interests of the Purchaser. The proceeds of sale of the REO
Property shall be promptly deposited in the Custodial Account. As soon as
practical thereafter the expenses of such sale shall be paid and the Seller
shall reimburse itself for any related unreimbursed Servicing Advances, unpaid
Servicing Fees and unreimbursed advances made pursuant to this Section, and on
the Remittance Date immediately following the Principal Prepayment Period in
which such sale proceeds are received the net cash proceeds of such sale
remaining in the Custodial Account shall be distributed to the Purchaser.
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With respect to each REO Property, the Seller shall hold all
funds collected and received in connection with the operation of the REO
Property in the Custodial Account. The Seller shall cause to be deposited on a
daily basis upon the receipt thereof in each Custodial Account all revenues
received with respect to the conservation and disposition of the related REO
Property.
Section 2.18 Permitted Withdrawals with respect to REO Property. The
Seller shall withdraw REO funds on deposit in the Custodial Account with respect
to each related REO Property necessary for the proper operation, management and
maintenance of the REO Property, including the cost of maintaining any hazard
insurance pursuant to Section 2.11 and the fees of any managing agent acting on
behalf of the Seller. The Seller shall make monthly distributions on each
Remittance Date to the Purchaser of the net cash flow from the REO Property
(which shall equal the revenues from such REO Property net of the expenses
described in Section 2.17 and of any reserves reasonably required from time to
time to be maintained to satisfy anticipated liabilities for such expenses).
Section 2.19 Real Estate Owned Reports. Together with the statement
furnished pursuant to Section 2.20, the Seller shall furnish to the Purchaser on
or before the 15th day of each month a statement with respect to any REO
Property covering the operation of such REO Property for the previous month and
the Seller's efforts in connection with the sale of such REO Property and any
rental of such REO Property incidental to the sale thereof for the previous
month. That statement shall be accompanied by such other information as the
Purchaser shall reasonably request.
Section 2.20 Liquidation Reports. Upon the foreclosure sale of any
Mortgaged Property or the acquisition thereof by the Purchaser pursuant to a
deed in lieu of foreclosure, the Seller shall submit to the Purchaser a
liquidation report with respect to such Mortgaged Property.
Section 2.21 Notification of Adjustments. With respect to each
adjustable rate Mortgage Loan, the Seller shall adjust the Mortgage Interest
Rate on the related Interest Rate Adjustment Date in compliance with the
requirements of applicable law and the related Mortgage and Mortgage Note. The
Seller shall execute and deliver any and all necessary notices required under
applicable law and the terms of the related Mortgage Note and Mortgage regarding
the Mortgage Interest Rate adjustments. The Seller shall promptly, upon written
request therefor, deliver to the Purchaser such notifications and any additional
applicable data regarding such adjustments and the methods used to calculate and
implement such adjustments. Upon the discovery by the Seller or the receipt of
notice from the Purchaser that the Seller has failed to adjust a Mortgage
Interest Rate in accordance with the terms of the related Mortgage Note, the
Seller shall immediately deposit in the Custodial Account from its own funds the
amount of any interest loss or deferral caused the Purchaser thereby.
Section 2.22 Reports of Foreclosures and Abandonments of Mortgaged
Property. Following the foreclosure sale or abandonment of any Mortgaged
Property, the Seller shall report such foreclosure or abandonment as required
pursuant to Section 6050J of the Code.
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Section 2.23 Waiver of Prepayment Charges. Except as set forth below,
the Seller or any designee of the Seller shall not waive any prepayment charge
with respect to any Mortgage Loan. If the Seller or its designee fails to
collect a prepayment charge at the time of the related prepayment of any
Mortgage Loan subject to such prepayment charge, the Seller shall pay to the
Custodial Account an amount equal to the amount of the prepayment charge not
collected. Notwithstanding the above, the Seller or its designee may waive a
prepayment charge without paying to the Custodial Account the amount of such
prepayment charge only if the related prepayment is not the result of a
refinancing by the Seller or its designee and such waiver (a) relates to a
defaulted Mortgage Loan or a reasonably foreseeable default, such waiver is
standard and customary in servicing similar mortgage loans to the Mortgage
Loans, and such waiver, in the reasonable judgment of the Seller, would maximize
recovery of total proceeds from the Mortgage Loan, taking into account the
amount of such prepayment charge and the related Mortgage Loan, or (b) relates
to a prepayment charge the collection of which, in the reasonable judgment of
the Seller, would be a violation of applicable laws.
Section 2.24 Safeguarding Customer Information.
The Seller has implemented and will maintain security measures
designed to meet the objectives of the Securities and Exchange Commission's
Regulation S-P published in final form at 17 C.F.R. 248, and the rules
promulgated thereunder, as amended from time to time.
The Seller shall promptly provide the Owner information
regarding such security measures upon the reasonable request of the Owner or its
designee (including any Master Seller of the Mortgage Loans) which information
shall include, but not be limited to, any Statement on Auditing Standards (SAS)
No. 70 report covering the Seller's operations, and any other audit reports,
summaries of test results or equivalent measures taken by the Seller with
respect to its security measures.
ARTICLE III
PAYMENTS TO PURCHASER
Section 3.01 Remittances. On each Remittance Date the Seller shall
remit by wire transfer of immediately available funds to the Purchaser (a) all
amounts deposited in the Custodial Account as of the close of business on the
Determination Date (net of charges against or withdrawals from the Custodial
Account pursuant to Section 2.05), plus (b) all amounts, if any, which the
Seller is obligated to distribute pursuant to Section 2.03.
With respect to any remittance received by the Purchaser after
the second Business Day following the Business Day on which such payment was
due, the Seller shall pay to the Purchaser interest on any such late payment at
an annual rate equal to the Prime Rate, adjusted as of the date of each change,
plus three percentage points, but in no event greater than the maximum amount
permitted by applicable law. Such interest shall be deposited in the Custodial
Account by the Seller on the date such late payment is made and shall cover the
period commencing with the day following such second Business Day and ending
with the Business Day on which such payment is made, both inclusive. Such
interest shall be remitted along with the distribution payable on the next
succeeding Remittance Date. The payment by the Seller of any such interest shall
not be deemed an extension of time for payment or a waiver of any Event of
Default by the Seller.
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Section 3.02 Statements to Purchaser. Not later than the third Business
Day or the fifth calendar day of each month, the Seller shall furnish to the
Purchaser a Monthly Remittance Advice, with a trial balance report attached
thereto, in the form of Exhibit 5 annexed hereto and a Standard Layout for
Defaulted Loan Report in the form of Exhibit 6 annexed hereto in hard copy and
electronic medium mutually acceptable to the parties as to the preceding
remittance and the period ending on the last day of the preceding month.
In addition, not more than 60 days after the end of each
calendar year, the Seller shall furnish to each Person who was a Purchaser at
any time during such calendar year an annual statement in accordance with the
requirements of applicable federal income tax law as to the aggregate of
remittances for the applicable portion of such year.
Such obligation of the Seller shall be deemed to have been
satisfied to the extent that substantially comparable information shall be
provided by the Seller pursuant to any requirements of the Internal Revenue Code
as from time to time are in force.
The Seller shall prepare and file any and all tax returns,
information statements or other filings required to be delivered to any
governmental taxing authority or to the Purchaser pursuant to any applicable law
with respect to the Mortgage Loans and the transactions contemplated hereby. In
addition, the Seller shall provide the Purchaser with such information
concerning the Mortgage Loans as is necessary for the Purchaser to prepare its
federal income tax return as the Purchaser may reasonably request from time to
time.
Section 3.03 Principal and Interest Advances by Seller. The Seller
shall have no obligation to advance any amounts constituting delinquent
principal and interest payments.
Section 3.04 Credit Reporting. For each Mortgage Loan, the Seller shall
accurately and fully furnish, in accordance with the Fair Credit Reporting Act
and its implementing regulations, accurate and complete information (e.g.,
favorable and unfavorable) on its borrower credit files to each of the following
credit repositories: Equifax Credit Information Services, Inc., Trans Union, LLC
and Experian Information Solution, Inc., on a monthly basis.
ARTICLE IV
GENERAL SERVICING PROCEDURES
Section 4.01 Transfers of Mortgaged Property. The Seller shall use its
best efforts to enforce any "due-on-sale" provision contained in any Mortgage or
Mortgage Note and to deny assumption by the person to whom the Mortgaged
Property has been or is about to be sold whether by absolute conveyance or by
contract of sale, and whether or not the Mortgagor remains liable on the
Mortgage and the Mortgage Note. When the Mortgaged Property has been conveyed by
the Mortgagor, the Seller shall, to the extent it has knowledge of such
conveyance, exercise its rights to accelerate the maturity of such Mortgage Loan
under the "due-on-sale" clause applicable thereto, provided, however, that the
Seller shall not exercise such rights if prohibited by law from doing so.
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If the Seller reasonably believes it is unable under
applicable law to enforce such "due-on-sale" clause, the Seller shall enter into
(a) an assumption and modification agreement with the person to whom such
property has been conveyed, pursuant to which such person becomes liable under
the Mortgage Note and the original Mortgagor remains liable thereon or (b) in
the event the Seller is unable under applicable law to require that the original
Mortgagor remain liable under the Mortgage Note and the Seller has the prior
consent of the primary mortgage guaranty insurer, a substitution of liability
agreement with the purchaser of the Mortgaged Property pursuant to which the
original Mortgagor is released from liability and the purchaser of the Mortgaged
Property is substituted as Mortgagor and becomes liable under the Mortgage Note.
If an assumption fee is collected by the Seller for entering into an assumption
agreement, a portion of such fee, up to an amount equal to one-half of one
percent (0.5%) of the outstanding principal balance of the related Mortgage
Loan, will be retained by the Seller as additional servicing compensation, and
any portion thereof in excess of one-half of one percent (0.5%) shall be
deposited in the Custodial Account for the benefit of the Purchaser. In
connection with any such assumption, neither the Mortgage Interest Rate borne by
the related Mortgage Note, the term of the Mortgage Loan nor the outstanding
principal amount of the Mortgage Loan shall be changed.
To the extent that any Mortgage Loan is assumable, the Seller
shall inquire diligently into the creditworthiness of the proposed transferee,
and shall use the underwriting criteria for approving the credit of the proposed
transferee which are used by ▇▇▇▇▇▇ Mae with respect to underwriting mortgage
loans of the same type as the Mortgage Loans. If the credit of the proposed
transferee does not meet such underwriting criteria, the Seller diligently
shall, to the extent permitted by the Mortgage or the Mortgage Note and by
applicable law, accelerate the maturity of the Mortgage Loan.
Section 4.02 Satisfaction of Mortgages and Release of Mortgage Files.
Upon the payment in full of any Mortgage Loan, or the receipt by the Seller of a
notification that payment in full will be escrowed in a manner customary for
such purposes, the Seller shall notify the Purchaser in the Monthly Remittance
Advice as provided in Section 3.02, and may request the release of any Mortgage
Loan Documents from the Purchaser in accordance with this Section 4.02.
If the Seller satisfies or releases a Mortgage without first
having obtained payment in full of the indebtedness secured by the Mortgage or
should the Seller otherwise prejudice any rights the Purchaser may have under
the mortgage instruments, upon written demand of the Purchaser, the Seller shall
repurchase the related Mortgage Loan at the Repurchase Price by deposit thereof
in the Custodial Account within 2 Business Days of receipt of such demand by the
Purchaser. The Seller shall maintain the Fidelity Bond and Errors and Omissions
Insurance Policy as provided for in Section 2.13 insuring the Seller against any
loss it may sustain with respect to any Mortgage Loan not satisfied in
accordance with the procedures set forth herein.
Section 4.03 Servicing Compensation. As consideration for servicing the
Mortgage Loans during the period from the related Closing Date up to but not
including the related Transfer Date, the Seller shall retain a Servicing Fee
with respect to each Mortgage Loan in the amount of $14.00 per month (unless
otherwise set forth in the related Purchase Price and Terms Agreement), which
amount shall be prorated for any portion of a month during which the Mortgage
Loan is serviced by the Seller pursuant to this Agreement. The obligation of the
Purchaser to pay the Servicing Fee is limited to, and the Servicing Fee is
payable solely from, the interest portion (including recoveries with respect to
interest from Liquidation Proceeds, to the extent permitted by Section 2.02), of
such Monthly Payment collected by the Seller, or as otherwise provided under
Section 2.03.
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Additional servicing compensation in the form of assumption
fees, to the extent provided in Section 4.01, and late payment charges shall be
retained by the Seller to the extent not required to be deposited in the
Custodial Account. The Seller shall be required to pay all expenses incurred by
it in connection with its servicing activities hereunder and shall not be
entitled to reimbursement thereof except as specifically provided for herein.
Section 4.04 Annual Statement as to Compliance. The Seller shall
deliver to the Purchaser, on or before February 28th each year beginning
February 28, 2005, and on the Transfer Date an Officer's Certificate, stating
that (a) a review of the activities of the Seller during the preceding calendar
year and of performance under this Agreement has been made under such officer's
supervision, and (b) the Seller has complied fully with the provisions of
Article II and Article IV, and (c) to the best of such officer's knowledge,
based on such review, the Seller has fulfilled all its obligations under this
Agreement throughout such year, or, if there has been a default in the
fulfillment of any such obligation, specifying each such default known to such
officer and the nature and status thereof and the action being taken by the
Seller to cure such default.
Section 4.05 Annual Independent Public Accountants' Servicing Report.
On or before February 28th of each year beginning February 28, 2005, the Seller,
at its expense, shall cause a firm of independent public accountants which is a
member of the American Institute of Certified Public Accountants to furnish a
statement to each Purchaser to the effect that such firm has examined certain
documents and records relating to the servicing of the Mortgage Loans and this
Agreement and that such firm is of the opinion that the provisions of Article II
and Article III have been complied with, and that, on the basis of such
examination conducted substantially in compliance with the Single Audit Program
for Mortgage Bankers, nothing has come to their attention which would indicate
that such servicing has not been conducted in compliance therewith, except for
(a) such exceptions as such firm shall believe to be immaterial, and (b) such
other exceptions as shall be set forth in such statement.
Section 4.06 Right to Examine Seller Records. The Purchaser shall have
the right to examine and audit any and all of the books, records, or other
information of the Seller, whether held by the Seller or by another on its
behalf, with respect to or concerning this Agreement or the Mortgage Loans,
during business hours or at such other times as may be reasonable under
applicable circumstances, upon reasonable advance notice.
ARTICLE V
SELLER TO COOPERATE
Section 5.01 Provision of Information. During the term of this
Agreement, the Seller shall furnish to the Purchaser such periodic, special, or
other reports or information, whether or not provided for herein, as shall be
necessary, reasonable, or appropriate with respect to the Purchaser or the
purposes of this Agreement. All such reports or information shall be provided by
and in accordance with all reasonable instructions and directions which the
Purchaser may give.
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The Seller shall execute and deliver all such instruments and
take all such action as the Purchaser may reasonably request from time to time,
in order to effectuate the purposes and to carry out the terms of this
Agreement.
Section 5.02 Financial Statements; Servicing Facilities. In connection
with marketing the Mortgage Loans, the Purchaser may make available to a
prospective Purchaser a Consolidated Statement of Operations of the Seller for
the most recently completed five fiscal years for which such a statement is
available, as well as a Consolidated Statement of Condition at the end of the
last two fiscal years covered by such Consolidated Statement of Operations. The
Seller also shall make available any comparable interim statements to the extent
any such statements have been prepared by or on behalf of the Seller (and are
available upon request to members or stockholders of the Seller or to the public
at large). If it has not already done so, the Seller shall furnish promptly to
the Purchaser copies of the statement specified above.
The Seller shall make available to the Purchaser or any
prospective Purchaser a knowledgeable financial or accounting officer for the
purpose of answering questions respecting recent developments affecting the
Seller or the financial statements of the Seller, and to permit any prospective
Purchaser to inspect the Seller's servicing facilities for the purpose of
satisfying such prospective Purchaser that the Seller has the ability to service
the Mortgage Loans as provided in this Agreement.
ARTICLE VI
TERMINATION
Section 6.01 Termination Upon Transfer of Servicing; Termination
Procedures.
This Agreement shall terminate with respect to the Mortgage
Loans included in each Mortgage Loan Package or portion thereof transferred on
the related Transfer Date.
The Purchaser may elect to terminate this Agreement and
transfer the servicing from the Seller prior to the related Transfer Date with
respect to all or any portion of the Mortgage Loans by providing written notice
to the Seller at least five (5) Business Days prior to the date on which it
intends to transfer the servicing of its intent to transfer the servicing from
the Seller. On or before the date specified by the Purchaser in accordance with
this Section 6.01 for the transfer of servicing from the Seller, the Seller
shall prepare, execute and deliver to the successor entity designated by the
Purchaser any and all documents and other instruments, place in such successor's
possession all Mortgage Loan Documents necessary or appropriate to effect the
purposes of such notice of termination, including but not limited to the
transfer and endorsement or assignment of the Mortgage Loans and related
documents, at the Seller's sole expense. The Seller shall cooperate with the
Purchaser and such successor in effecting the termination of the Seller's
responsibilities and rights hereunder.
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On the related Transfer Date, the Seller shall comply with all
of the provisions of Section 5 of the Purchase Agreement to effect a complete
transfer of the Servicing Rights. On the related Transfer Date for each Mortgage
Loan, this Agreement, except for Articles VI, VIII, IX and X which shall survive
such Transfer Date, shall terminate.
ARTICLE VII
BOOKS AND RECORDS
Section 7.01 Possession of Servicing Files Prior to the Transfer Date.
Prior to the Transfer Date, the contents of each Servicing File are and shall be
held in trust by the Seller for the benefit of the Purchaser as the owner
thereof. The Seller shall maintain in the Servicing File a copy of the contents
of each Mortgage File and the originals of the documents in each Mortgage File
not delivered to the Purchaser. The possession of the Servicing File by the
Seller is at the will of the Purchaser for the sole purpose of servicing the
related Mortgage Loan, pursuant to this Agreement, and such retention and
possession by the Seller is in its capacity as servicer only and at the election
of the Purchaser. The Seller shall release its custody of the contents of any
Servicing File only in accordance with written instructions from the Purchaser,
unless such release is required as incidental to the Seller's servicing of the
Mortgage Loans pursuant to this Agreement, or is in connection with a repurchase
of any Mortgage Loan pursuant to Section 8 of the Purchase Agreement.
The Seller shall be responsible for maintaining, and shall
maintain, a complete set of books and records for each Mortgage Loan which shall
be marked clearly to reflect the ownership of each Mortgage Loan by the
Purchaser. In particular, the Seller shall maintain in its possession, available
for inspection by the Purchaser or its designee, and shall deliver to the
Purchaser or its designee upon demand, evidence of compliance with all federal,
state and local laws, rules and regulations, and requirements of ▇▇▇▇▇▇ ▇▇▇ or
▇▇▇▇▇▇▇ Mac, including but not limited to documentation as to the method used in
determining the applicability of the provisions of the Flood Disaster Protection
Act of 1973, as amended, to the Mortgaged Property, documentation evidencing
insurance coverage and eligibility of any condominium project for approval by
▇▇▇▇▇▇ Mae and periodic inspection reports as required by Section 2.14.
The Seller shall keep at its servicing office books and
records in which, subject to such reasonable regulations as it may prescribe,
the Seller shall note transfers of Mortgage Loans. No transfer of a Mortgage
Loan may be made unless such transfer is in compliance with the terms hereof.
For the purposes of this Agreement, the Seller shall be under no obligation to
deal with any person with respect to this Agreement or the Mortgage Loans unless
the books and records show such person as the owner of the Mortgage Loan. The
Purchaser may, subject to the terms of this Agreement, sell or transfer one or
more of the Mortgage Loans. The Purchaser also shall advise the Seller of the
transfer. Upon receipt of notice of the transfer, the Seller shall ▇▇▇▇ its
books and records to reflect the ownership of the Mortgage Loans of such
assignee, and shall release the previous Purchaser from its obligations
hereunder with respect to the Mortgage Loans sold or transferred.
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ARTICLE VIII
INDEMNIFICATION AND ASSIGNMENT
(a) Indemnification. The Seller agrees to indemnify and hold
the Purchaser harmless from any liability, claim, loss or damage to the
Purchaser directly or indirectly resulting from the Seller's failure to observe
and perform any or all of Seller's duties, obligations, covenants, agreements,
warranties or representations contained in this Agreement or in the Purchase
Agreement. The Purchaser agrees to indemnify and hold the Seller harmless from
any liability, claim, loss or damage to the Seller directly or indirectly
resulting from the Purchaser's failure to observe and perform any or all of
Purchaser's duties, obligations, covenants, agreements, warranties or
representations contained in this Agreement.
The Seller immediately shall notify the Purchaser if a claim
is made by a third party with respect to the Mortgage Loans or this Agreement.
Section 8.02 Limitation on Liability of Seller and Others. Neither the
Seller nor any of the directors, officers, employees or agents of the Seller
shall be under any liability to the Purchaser for any action taken or for
refraining from the taking of any action in good faith pursuant to this
Agreement, or for errors in judgment, provided, however, that this provision
shall not protect the Seller or any such person against any breach of warranties
or representations made herein, or failure to perform its obligations in strict
compliance with any standard of care set forth in this Agreement, or any
liability which would otherwise be imposed by reason of any breach of the terms
and conditions of this Agreement. The Seller and any director, officer, employee
or agent of the Seller may rely in good faith on any document of any kind prima
facie properly executed and submitted by any Person respecting any matters
arising hereunder. The Seller shall not be under any obligation to appear in,
prosecute or defend any legal action which is not incidental to its duties to
service the Mortgage loans in accordance with this Agreement and which in its
opinion may involve it in any expense or liability, provided, however, that the
Seller may, with the consent of the Purchaser, undertake any such action which
it may deem necessary or desirable in respect to this Agreement and the rights
and duties of the parties hereto. In such event, the Seller shall be entitled to
reimbursement from the Purchaser of the reasonable legal expenses and costs of
such action.
Section 8.03 Limitation on Resignation and Assignment by Seller. The
Purchaser has entered into this Agreement with the Seller and subsequent
Purchasers will purchase the Mortgage Loans in reliance upon the independent
status of the Seller, and the representations as to the adequacy of its
servicing facilities, plant, personnel, records and procedures, its integrity,
reputation and financial standing, and the continuance thereof. Therefore, the
Seller shall neither assign this Agreement or the servicing hereunder or
delegate its rights or duties hereunder or any portion hereof or sell or
otherwise dispose of all or substantially all of its property or assets without
the prior written consent of the Purchaser, which consent shall be granted or
withheld in the sole discretion of the Purchaser.
The Seller shall not resign from the obligations and duties
hereby imposed on it except by mutual consent of the Seller and the Purchaser or
upon the determination that its duties hereunder are no longer permissible under
applicable law and such incapacity cannot be cured by the Seller. Any such
determination permitting the resignation of the Seller shall be evidenced by an
Opinion of Counsel to such effect delivered to the Purchaser which Opinion of
Counsel shall be in form and substance acceptable to the Purchaser. No such
resignation shall become effective until a successor shall have assumed the
Seller's responsibilities and obligations hereunder in the manner provided in
Section 6.01.
-21-
Without in any way limiting the generality of this Section
8.03, in the event that the Seller either shall assign this Agreement or the
servicing responsibilities hereunder or delegate its duties hereunder or any
portion thereof or sell or otherwise dispose of all or substantially all of its
property or assets, without the prior written consent of the Purchaser, then the
Purchaser shall have the right to terminate this Agreement upon notice given as
set forth in Section 6.01, without any payment of any penalty or damages and
without any liability whatsoever to the Seller or any third party.
Section 8.04 Assignment by Purchaser. The Purchaser shall have the
right, without the consent of the Seller, to assign, in whole or in part, its
interest under this Agreement with respect to some or all of the Mortgage Loans,
and designate any person to exercise any rights of the Purchaser hereunder. Upon
such assignment of rights and assumption of obligations, the assignee or
designee shall accede to the rights and obligations hereunder of the Purchaser
with respect to such Mortgage Loans and the Purchaser as assignor shall be
released from all obligations hereunder with respect to such Mortgage Loans from
and after the date of such assignment and assumption. All references to the
Purchaser in this Agreement shall be deemed to include its assignee or designee.
ARTICLE IX
REPRESENTATIONS, WARRANTIES AND COVENANTS OF PURCHASER
The Purchaser warrants and represents to, and covenants and
agrees with, the Seller as follows:
Section 9.01 Authority and Capacity. The execution, delivery and
performance by the Purchaser of this Agreement has been and will remain duly and
validly authorized by all necessary corporate action. This Agreement constitutes
and will continue to constitute a legal, valid and enforceable obligation of the
Purchaser.
Section 9.02 Assistance. To the extent possible, the Purchaser shall
cooperate with and assist the Seller as requested by the Seller, in carrying out
Seller's covenants, agreements duties and responsibilities under the Purchase
Agreement and in connection therewith shall execute and deliver all such papers,
documents and instruments as may be necessary and appropriate in furtherance
thereof.
-22-
ARTICLE X
REPRESENTATIONS AND WARRANTIES OF SELLER
The Seller warrants and represents to, and covenants and
agrees with, the Purchaser as follows:
Section 10.01 Due Organization and Authority. The Seller is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Massachusetts and has all licenses necessary to carry on its
business as now being conducted and is licensed, qualified and in good standing
in each state where a Mortgaged Property is located if the laws of such state
require licensing or qualification in order to conduct business of the type
conducted by the Seller, and in any event the Seller is in compliance with the
laws of any such state to the extent necessary to ensure the enforceability of
the related Mortgage Loan in accordance with the terms of this Agreement; the
Seller has the full company power and authority to execute and deliver this
Agreement and to perform in accordance herewith; the execution, delivery and
performance of this Agreement (including all instruments or transfer to be
delivered pursuant to this Agreement) by the Seller and the consummation of the
transactions contemplated hereby have been duly and validly authorized; this
Agreement evidences the valid, binding and enforceable obligation of the Seller;
and all requisite company action has been taken by the Seller to make this
Agreement valid and binding upon the Seller in accordance with its terms;
Section 10.02 Ordinary Course of Business. The consummation of the
transactions contemplated by this Agreement are in the ordinary course of
business of the Seller;
Section 10.03 No Conflicts. Neither the execution and delivery of this
Agreement, nor the fulfillment of or compliance with the terms and conditions of
this Agreement, will conflict with or result in a breach of any of the terms,
conditions or provisions of the Seller's charter or by-laws or any legal
restriction or any agreement or instrument to which the Seller is now a party or
by which it is bound, or constitute a default or result in an acceleration under
any of the foregoing, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Seller or its property is subject, or
impair the ability of the Purchaser to realize on the Mortgage Loans, or impair
the value of the Mortgage Loans;
Section 10.04 Ability to Perform. The Seller does not believe, nor does
it have any reason or cause to believe, that it cannot perform each and every
covenant contained in this Agreement;
Section 10.05 No Litigation Pending. There is no action, suit,
proceeding or investigation pending or threatened against the Seller which,
either in any one instance or in the aggregate, may result in any material
adverse change in the business, operations, financial condition, properties or
assets of the Seller, or in any material impairment of the right or ability of
the Seller to carry on its business substantially as now conducted, or in any
material liability on the part of the Seller, or which would draw into question
the validity of this Agreement or the Mortgage Loans or of any action taken or
to be taken in connection with the obligations of the Seller contemplated
herein, or which would be likely to impair materially the ability of the Seller
to perform under the terms of this Agreement;
-23-
Section 10.06 No Consent Required. No consent, approval, authorization
or order of any court or governmental agency or body is required for the
execution, delivery and performance by the Seller of or compliance by the Seller
with this Agreement or the Servicing of the Mortgage Loans as evidenced by the
consummation of the transactions contemplated by this Agreement, or if required,
such approval has been obtained prior to the related Closing Date;
Section 10.07 No Untrue Information. Neither this Agreement nor any
statement, report or other document furnished or to be furnished pursuant to
this Agreement or in connection with the transactions contemplated hereby
contains any untrue statement of fact or omits to state a fact necessary to make
the statements contained therein not misleading.
ARTICLE XI
DEFAULT
Section 11.01 Events of Default. The following shall constitute an
Event of Default under this Agreement on the part of the Seller:
(a) any failure by the Seller to remit to the Purchaser any
payment required to be made under the terms of this Agreement which continues
unremedied for a period of two (2) days after the date upon which written notice
of such failure, requiring the same to be remedied, shall have been given to the
Seller by the Purchaser; or
(b) the failure by the Seller duly to observe or perform in
any material respect any other of the covenants or agreements on the part of the
Seller set forth in this Agreement which continues unremedied for a period of
ten (10) days after the date on which written notice of such failure, requiring
the same to be remedied, shall have been given to the Seller by the Purchaser;
or
(c) a decree or order of a court or agency or supervisory
authority having jurisdiction for the appointment of a conservator or receiver
or liquidator in any insolvency, readjustment of debt, marshaling of assets and
liabilities or similar proceedings, or for the winding-up or liquidation of its
affairs, shall have been entered against the Seller and such decree or order
shall have remained in force undischarged or unstayed for a period of 60 days;
or
(d) the Seller shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of debt,
marshaling of assets and liabilities or similar proceedings of or relating to
the Seller or of or relating to all or substantially all of its property; or
(e) the Seller shall admit in writing its inability to pay its
debts generally as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make an assignment for the
benefit of its creditors, or voluntarily suspend payment of its obligations; or
(f) the Seller attempts to assign its right to servicing
compensation hereunder or the Seller attempts, without the consent of the
Purchaser, to sell or otherwise dispose of all or substantially all of its
property or assets or to assign this Agreement or the servicing responsibilities
hereunder or to delegate its duties hereunder or any portion thereof.
-24-
In each and every such case, so long as an Event of Default
shall not have been remedied, in addition to whatever rights the Purchaser may
have at law or equity to damages, including injunctive relief and specific
performance, the Purchaser, by notice in writing to the Seller, may terminate
all the rights and obligations of the Seller under this Agreement and in and to
the Mortgage Loans and the proceeds thereof.
Upon receipt by the Seller of such written notice, all
authority and power of the Seller under this Agreement, whether with respect to
the Mortgage Loans or otherwise, shall pass to and be vested in the successor
appointed pursuant to Section 6.01.
Section 11.02 Waiver of Defaults. By a written notice, the Purchaser
may waive any default by the Seller in the performance of its obligations
hereunder and its consequences. Upon any waiver of a past default, such default
shall cease to exist, and any Event of Default arising therefrom shall be deemed
to have been remedied for every purpose of this Agreement. No such waiver shall
extend to any subsequent or other default or impair any right consequent thereon
except to the extent expressly so waived.
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01 Notices. All notices, requests, demands and other
communications which are required or permitted to be given under this Agreement
shall be in writing and shall be deemed to have been duly given upon the
delivery or mailing thereof, as the case may be, sent by registered or certified
mail, return receipt requested:
(a) If to Purchaser to:
▇▇▇▇▇▇ Brothers Bank, FSB
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Contract Finance
(b) If to Seller to:
Mortgage Network, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Section 12.02 Waivers. Either the Seller or Purchaser may upon consent
of all parties, by written notice to the others:
(a) Waive compliance with any of the terms, conditions or
covenants required to be complied with by the others hereunder; and
-25-
(b) Waive or modify performance of any of the obligations of
the others hereunder.
The waiver by any party hereto of a breach of any provision of
this Agreement shall not operate or be construed as a waiver of any other
subsequent breach.
Section 12.03 Entire Agreement; Amendment. This Agreement and the
Purchase Agreement constitute the entire agreement between the parties with
respect to servicing of the Mortgages during the Interim Period. This Agreement
may be amended and any provision hereof waived, but, only in writing signed by
the party against whom such enforcement is sought.
Section 12.04 Execution; Binding Effect. This Agreement may be executed
in one or more counterparts and by the different parties hereto on separate
counterparts, each of which, when so executed, shall be deemed to be an
original; such counterparts, together, shall constitute one and the same
agreement. Subject to Section 8.03, this Agreement shall inure to the benefit of
and be binding upon the Seller and the Purchaser and their respective successors
and assigns.
Section 12.05 Headings. Headings of the Articles and Sections in this
Agreement are for reference purposes only and shall not be deemed to have any
substantive effect.
Section 12.06 Applicable Law. This Agreement shall be construed in
accordance with the laws of the State of New York.
Section 12.07 Relationship of Parties. Nothing herein contained shall
be deemed or construed to create a partnership or joint venture between the
parties. The duties and responsibilities of the Seller shall be rendered by them
as independent contractors and not as an agent of Purchaser. The Seller shall
have full control of all of its acts, doings, proceedings, relating to or
requisite in connection with the discharge of its duties and responsibilities
under this Agreement.
Section 12.08 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be held
invalid for any reason whatsoever, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement.
Section 12.09 Recordation of Assignments of Mortgage. To the extent
permitted by applicable law, each of the Assignments of Mortgage is subject to
recordation in all appropriate public offices for real property records in all
the counties or other comparable jurisdictions in which any or all of the
Mortgaged Properties are situated, and in any other appropriate public recording
office or elsewhere, such recordation to be effected at the Seller's expense in
the event recordation is either necessary under applicable law or requested by
the Purchaser at its sole option.
-26-
Section 12.10 Appointment of Master Servicer.
The Purchaser may, in its sole discretion from time to time,
engage a master servicer (the "Master Servicer") to assist the Purchaser in the
supervision of the performance by the Company of its obligations and
responsibilities arising under this Agreement. In the event that the Purchaser
so appoints a Master Servicer, the Purchaser shall provide written notice
thereof to the Company. From the date of such notice until such time as the
Company receives written notice from the Purchaser that it has terminated or
replaced such Master Servicer, the Company shall deliver all notices, reports
and remittances that the Company is obligated to deliver to the Purchaser under
this Agreement directly to the Master Servicer named in such notice (or to any
successor master servicer named in any subsequent written notice received from
the Purchaser). The Master Servicer, acting on behalf of the Purchaser, shall
have the benefit of the covenants and agreements of the Company under this
Agreement and the Master Servicer, acting on behalf of the Purchaser, shall have
the same rights as the Purchaser to enforce the obligations of the Company
arising under this Agreement. The Master Servicer shall be entitled to terminate
the rights and obligations of the Company under this Agreement upon the
occurrence of an Event of Default as provided in this Agreement. Notwithstanding
anything herein to the contrary, in no event shall the Master Servicer assume
any of the obligations of the Purchaser under this Agreement; and in connection
with the performance of the Master Servicer's duties hereunder the Company
agrees that the Master Servicer shall be entitled to all of the rights,
protections, indemnities and limitations of liability afforded to the Purchaser
under this Agreement. The Purchaser hereby appoints Aurora Loan Services Inc. as
its initial Master Servicer hereunder.
-27-
IN WITNESS WHEREOF, the parties have executed this Agreement
under seal as of the date and year first above written.
▇▇▇▇▇▇ BROTHERS BANK, FSB
(the Purchaser)
By: __________________________
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
MORTGAGE NETWORK, INC.
(the Seller)
By: __________________________
Name:
Title:
-28-
EXHIBIT 1
FORM OF CUSTODIAL ACCOUNT CERTIFICATION
_______ __, 200_
_____________________________________________ hereby certifies
that it has established the account described below as a Custodial Account
pursuant to Section 2.04 of the Flow Interim Servicing Agreement, dated as of
February 16, 2004, Fixed and Adjustable Rate Mortgage Loans, Group 2004-FLOW.
Title of Account: "Mortgage Network, Inc. in trust for the
registered Purchaser, Group 2004-FLOW."
Account Number:___________________
Address of office or branch
of the Seller at
which Account is maintained:___________________
MORTGAGE NETWORK, INC.
________________________________
By: ____________________________
Name:
Title:
1-1
EXHIBIT 2
FORM OF CUSTODIAL ACCOUNT LETTER AGREEMENT
_______ __, 200[_]
To: _______________________
_______________________
_______________________
(the "Depository")
As Seller under the Flow Interim Servicing Agreement, dated as
of February 16, 2004, Fixed and Adjustable Rate Mortgage Loans, Group 2004-FLOW
(the "Agreement"), we hereby authorize and request you to establish an account,
as a Custodial Account pursuant to Section 2.04 of the Agreement, to be
designated as "Mortgage Network, Inc., in trust for the Fixed and Adjustable
Rate Mortgage Loans - Group 2004-FLOW." All deposits in the account shall be
subject to withdrawal therefrom by order signed by the Seller. You may refuse
any deposit which would result in violation of the requirement that the account
be fully insured as described below. This letter is submitted to you in
duplicate. Please execute and return one original to us.
MORTGAGE NETWORK, INC.
By: ______________________________
Name:
Title:
Date:
2-1
The undersigned, as Depository, hereby certifies that the
above described account has been established under Account Number __________, at
the office of the Depository indicated above, and agrees to honor withdrawals on
such account as provided above.
______________________________
Depository
By: __________________________
Name:
Title:
Date:
2-2
EXHIBIT 3
FORM OF ESCROW ACCOUNT CERTIFICATION
_________ ___, 200[_]
__________________________________ hereby certifies that it
has established the account described below as an Escrow Account pursuant to
Section 2.06 of the Flow Interim Servicing Agreement, dated as of February 16,
2004, Fixed and Adjustable Rate Mortgage Loans, Group 2004-FLOW.
Title of Account: "Acoustic Home Loans in trust for the
Purchaser of the Fixed and Adjustable Rate Mortgage Loans, Group 2004-FLOW, and
various Mortgagors."
Account Number:_________________
Address of office or branch
of the Seller at
which Account is maintained:________________
MORTGAGE NETWORK, INC.
By: _____________________________
Name:
Title:
Date:
3-1
EXHIBIT 5
FORM OF ESCROW ACCOUNT LETTER AGREEMENT
_______ __, 200[_]
To: ____________________________
____________________________
____________________________
(the "Depository")
As Seller under the Flow Interim Servicing Agreement, dated as
of February 16, 2004, Fixed and Adjustable Rate Mortgage Loans, Group 2004-FLOW
(the "Agreement"), we hereby authorize and request you to establish an account,
as an Escrow Account pursuant to Section 2.06 of the Agreement, to be designated
as "Mortgage Network, Inc., in trust for the Purchasers of Fixed and Adjustable
Rate Mortgage Loans - Group 2004-FLOW." All deposits in the account shall be
subject to withdrawal therefrom by order signed by the Seller. You may refuse
any deposit which would result in violation of the requirement that the account
be fully insured as described below. This letter is submitted to you in
duplicate. Please execute and return one original to us.
MORTGAGE NETWORK, INC.
By:__________________________
Name:
Title:
Date:
4-1
The undersigned, as Depository, hereby certifies that the
above described account has been established under Account Number ______, at the
office of the Depository indicated above, and agrees to honor withdrawals on
such account as provided above.
Depository
By: ______________________________
Name:
Title:
Date:
EXHIBIT 5 FORM OF MONTHLY REMITTANCE ADVICE
FIELD NAME DESCRIPTION FORMAT
---------- ----------- ------
INVNUM INVESTOR LOAN NUMBER Number no decimals
SERVNUM SERVICER LOAN NUMBER, REQUIRED Number no decimals
BEGSCHEDBAL BEGINNING SCHEDULED BALANCE FOR SCHED/SCHED Number two decimals
BEGINNING TRAIL BALANDE FOR ACTUAL/ACTUAL,
REQUIRED
SCHEDPRIN SCHEDULED PRINCIPAL AMOUNT FOR SCHEDULED/SCHEDULED Number two decimals
ACTUAL PRINCIPAL COLLECTED FOR ACTUAL/ACTUAL,
REQUIRED, .00 IF NO COLLECTIONS
CURT1 CURTAILMENT 1 ▇▇▇▇▇▇, .▇▇ IF NOT APPLICABLE Number two decimals
CURT1DATE CURTAILMENT 1 DATE, BLANK IF NOT APPLICABLE DD-MMM-YY
CURT1ADJ CURTAILMENT 1 ADJUSTMENT, .00 IF NOT APPLICABLE Number two decimals
CURT2 CURTAILMENT 2 ▇▇▇▇▇▇, .▇▇ IF NOT APPLICABLE Number two decimals
CURT2DATE CURTAILMENT 2 DATE, BLANK IF NOT APPLICABLE DD-MMM-YY
CURT2ADJ CURTAILMENT 2 ADJUSTMENT, .00 IF NOT APPLICABLE Number two decimals
LIQPRIN PAYOFF, LIQUIDATION PRINCIPAL, .00 IF NOT APPLICABLE Number two decimals
OTHPRIN OTHER PRINCIPAL, .00 IF NOT APPLICABLE Number two decimals
PRINREMIT TOTAL PRINCIPAL REMITTANCE AMOUNT, .00 IF NOT APPLICABLE Number two decimals
INTREMIT NET INTEREST REMIT, INCLUDE PAYOFF INTEREST, Number two decimals
.00 IF NOT APPLICABLE
TOTREMIT TOTAL REMITTANCE AMOUNT, .00 IF NOT APPLICABLE Number two decimals
ENDSCHEDBAL ENDING SCHEDULED BALANCE FOR SCHEDULED/SCHEDULED Number two decimals
ENDING TRIAL BALANCE FOR ACTUAL/ACTUAL
.00 IF PAIDOFF, LIQUIDATED OR FULL CHARGEOFF
ENDACTBAL ENDING TRIAL BALANCE Number two decimals
.00 IF PAIDOFF, LIQUIDATED OR FULL CHARGEOFF
ENDDUEDATE ENDING ACTUAL DUE DATE, NOT LAST PAID INSTALLMENT DD-MMM-YY
ACTCODE 60 IF PAIDOFF, BLANK IF NOT APPLICABLE Number no decimals
ACTDATE ACTUAL PAYOFF DATE, BLANK IF NOT APPLICABLE DD-MMM-YY
INTRATE INTEREST RATE, REQUIRED Number seven decimals
Example .0700000 for 7.00%
SFRATE SERVICE FEE RATE, REQUIRED Number seven decimals
Example .0025000 for .25%
PTRATE PASS THRU RATE, REQUIRED Number seven decimals
Example .0675000 for 6.75%
PIPMT P&I CONSTANT, REQUIRED Number two decimals
.00 IF PAIDOFF
5-1
EXHIBIT 6
STANDARD LAYOUT FOR MONTHLY DEFAULTED LOAN REPORT
FIELD NAME DESCRIPTION
---------- -----------
% of MI Coverage % of MI Coverage
Actual MI Claim Filed Date The date the Claim to the MI Company was filed
Actual Bankruptcy Start Date (filing date) Actual Bankruptcy Start Date (filing date)
Actual Claim Amount Filed The amount claimed to the MI company on the MI
claim
Actual Discharge Date Date Bankruptcy was Discharged
Actual Due Date Next Payment Due Date
Actual Eviction Complete Date Actual Eviction Complete Date
Actual Eviction Start Date Actual Eviction Start Date
Actual First Legal Date Actual First Legal Date
Actual Notice of Intent Date (breach letter date) Actual Notice of Intent Date (breach letter date)
Actual Payment Plan End Date The date the Last Pre-petition payment is due from
the Trustee in a chapter 13 BK
Actual Payment Plan Start Date The date the First Pre-petition payment is due from
the Trustee in a chapter 13 BK
Actual Redemption End Date Actual Redemption End Date
Actual REO Start Date The date the account was received by the REO
Department
Appraisal, BPO Costs Total expenses incurred for the purpose of BPO's
or Appraisals.
Bankruptcy Chapter Bankruptcy Chapter 7,11,13
BK Atty Fees & Costs BK Atty Fees & Costs
BK Flag (Man Code) A code that identifies the account as an active
Bankruptcy.
Bnk Case # (7 digit only) Bnk Case # (7 digit only)
City City
Claim Amount Paid MI Claim Amount
Claim Funds Received Date The date the MI Claim funds were received from the MI
Company
Confirmation Hearing Date Confirmation Hearing Date
Current Interest Rate Current Interest Rate
Current Loan Amount Unpaid Principal Balance
Current P&I Payment Amount Current P&I Payment Amount
Date Bid Instructions Sent Date Bid Instructions Sent to Attorney
Date Filed Relief/Dismissal The date the motion for Relief or Dismissal was filed
with the BK Court
Date Loan Reinstated Date Loan Reinstated
Date POC Filed Date proof of claim filed
Date Relief/Dismissal Granted The date the BK court granted the motion for Relief or
Dismissal
Date REO Offer Accepted Date REO Offer Accepted
Date REO Offer Received Date REO Offer Received
6-1
Deal Identifier by Loan Security Name/Cross reference Investor ID
(Servicer to Cross reference)
Delinquency Status (Man Code) 30, 60, 90, BK, FC, REO, Claims or a code that can
be decoded to determine the current status of the
account.
Loss Mit Denial Date Loss Mit Denial Date
Eviction Atty Fees & Costs Eviction Atty Fees & Costs
F/B 1st Due (if applicable) F/B 1st Due (if applicable)
F/B Last Due (if applicable) F/B Last Due (if applicable)
FC Atty Fees & Costs FC Atty Fees & Costs
FC Flag A code that identifies the account as an active
Foreclosure.
FC Start Date (referral date) FC Start Date (referral date)
FC Suspended Date FC Suspended Date
FC Valuation Amount The value of the property as determined for the
purpose of foreclosure.
FC Valuation Date The date the property value was determined for the
purpose of foreclosure.
FC Valuation Source The type of valuation that was used to determine
the Fc Valuation amount.
FHA 27011A Transmitted Date FHA 27011A Transmitted Date
FHA 27011B Transmitted Date FHA 27011B Transmitted Date
FHA Case # FHA Case #
FHA Part A Funds Received Date FHA Part A Funds Received Date
First Payment Date First Payment Date
Foreclosure Actual Sale Date Date F/C Sale Held
VA Guarantee % VA Guarantee %
Interest Advances Interest Advances
Investor Loan Number Investor Loan Number
INVESTOR/SECURITY BILLING SENT DATE Date claim submitted to investor
Liquidation Status Type of PIF, S/S, 3rd Party etc.
VA Loan Guurantee Certificate Number VA Loan Guarantee Certificate Number
Loan Number Servicer Loan Number
Loan Term Loan Term
Loan Type Loan Type
Loss Mit Approval Date Loss Mit Approval Date
Loss Mit Flag (Man Code) A code that identifies the account as an active
Loss Mit account.
Loss Mit Removal Date The date the Loss Mit Department determined that
Loss Mit Options were no longer a viable option.
Loss Mit Start Date Loss Mit Set-up Date
Loss Mit Type S/S, Forbearance, Repay, Mod, etc.
Loss Mit Workstation Status Completed, Removed, Active
MI Certificate Number MI Certificate Number
MI Cost Price percentage, lender paid only
MI Coverage Y/N MI Coverage Y/N
Monthly MIP Cost The monthly fee paid to HUD to maintain coverage on
the account.
Next Payment Adjustment Date Next Payment Adjustment Date
Next Rate Adjustment Date Next Rate Adjustment Date
6-2
Occupancy Status Occupancy Status
Occupancy Status Date The date the occupancy status reported was
determined.
Original Loan Amount Original Loan Amount
Original Value Amount The value of the property as determined at the
origination of the account.
Origination Date The date the closing occurred to originate the loan.
ORIGINATION VALUE DATE The date the original Value Amount was
determined.
ORIGINATION VALUE SOURCE The type of valuation that was used to determine
the Original Value amount.
Other Advance Expenses Total Advances minus all other/detail and total
Ownership Code
Paid in Full Date Date loan liquidated from system UPB removed Paid Off
Code
Part B Funds Received Date FHA/VA Only
Partial Prepayment Amount Collected
Post Petition Due Date
Prepayment Expiration Date Term
Prepayment Flag
Prepayment Premium Collected
Prepayment Waived
Product Type
Property Condition
PROPERTY PRESERVATION FEES
Property Type
Realized Gain or Loss
Reason for Default
Reason Suspended
Relief/Dismissal Hearing Date
REO Repaired Value
REO Value(As-is)
REO Actual Closing Date
REO Flag (Man Code)
REO List Date
REO List Price
REO Net Sales proceeds
REO Sales Price
REO Scheduled Close Date
REO Value Date
REO VALUE SOURCE
Repay First Due Date
Repay Last Due Date
Repay Next Due Date
Repay Plan Broken Date
Repay Plan Created Date
SBO LOAN NUMBER
Scheduled Balance
Scheduled Due Date
Servicing Fee
State
6-3
Street Address
T&I Advances
Title Approval Letter Received Date
Title Package to HUD Date
Title Package to VA Date
VA Claim Funds Received Date
VA Claim Submitted Date
VA FIRST FUNDS RECEIVED AMOUNT
VA FIRST FUNDS RECEIVED DATE
VA ▇▇▇ Submitted Date
ZIP CODE
FNMA ACTION CODE
FNMA DELINQUENCY REASON CODE
6-4
