Exhibit 99.8
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FLOW MORTGAGE LOAN PURCHASE AND SERVICING AGREEMENT
XXXXXX BROTHERS BANK, FSB
(Initial Purchaser)
CITIMORTGAGE, INC.
(Seller and Servicer)
Fixed Rate Mortgage Loans
Dated and effective as of May 1, 2004
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MORTGAGE LOAN PURCHASE AND SERVICING AGREEMENT
This is a Mortgage Loan Purchase and Servicing Agreement (the
"Agreement"), dated and effective as of May 1, 2004, by and between Xxxxxx
Brothers Bank, FSB, (the "Initial Purchaser," and the Initial Purchaser or the
Person, if any, to which the Initial Purchaser has assigned its rights and
obligations hereunder as Purchaser with respect to a Mortgage Loan, and each of
their respective successors and assigns, the "Purchaser"), and CITIMORTGAGE,
INC. (the "Seller").
WITNESSETH:
WHEREAS, Purchaser has agreed to purchase from Seller from time to time,
and Seller has agreed to sell to Purchaser from time to time, certain mortgage
loans (the "Mortgage Loans") on a non-recourse, servicing retained basis, and
which shall be delivered as whole loans on various dates provided herein (each a
"Closing Date");
WHEREAS, Each Mortgage Loan is secured by a mortgage, deed of trust or
other instrument creating a first lien on a residential dwelling located in the
jurisdiction indicated on the Mortgage Loan Schedule; and
WHEREAS, Purchaser and Seller wish to prescribe the manner of the
purchase, conveyance, management, servicing and control of the Mortgage Loans.
NOW THEREFORE, In consideration of the premises and the mutual agreements
hereinafter set forth, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Purchaser and
Seller agree as follows:
ARTICLE I
DEFINITIONS; GENERAL INTERPRETIVE PRINCIPLES
Section 1.01 Definitions.
Whenever used herein, the following words and phrases, unless the context
otherwise requires, shall have the following meanings:
Agency(ies): Xxxxxx Xxx and/or Xxxxxxx Mac.
Agency Transfer: Any sale or transfer of some or all of the Mortgage Loans
by the Purchaser to an Agency which sale or transfer is not a Pass-Through
Transfer or Whole Loan Transfer.
Agreement: This Mortgage Loan Purchase and Servicing Agreement, including
all exhibits hereto, and all amendments hereof and supplements hereto.
ALTA: The American Land Title Association or any successor thereto.
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Appraised Value: As to any Mortgage Loan, the value of the related
Mortgaged Property based upon the appraisal made at the origination of the
Mortgage Loan or the sales price of the Mortgaged Property, whichever is less,
provided, however, that in the case of a Refinanced Mortgage Loan, such value is
based solely upon the appraisal made at the time of origination of such
Refinanced Mortgage Loan.
Assignment and Conveyance: An Assignment and Conveyance Agreement in the
form of Exhibit L hereto dated as of the related Closing Date, by and between
the Seller and the Purchaser.
Assignment of Mortgage: An assignment of the Mortgage, notice of transfer
or equivalent instrument, in recordable form, that when properly completed and
recorded, is sufficient under the laws of the jurisdiction wherein the related
Mortgaged Property is located to reflect of record the sale of the Mortgage Loan
to Purchaser.
BIF: The Bank Insurance Fund, or any successor thereto.
Business Day: Any day other than (i) a Saturday or Sunday, or (ii) a day
on which banking or savings and loan institutions in the States of New York or
Missouri are authorized or obligated by law or executive order to be closed.
Citibank: Citibank (West), FSB and any successors or assigns.
Closing Date: The date or dates set forth on the related Assignment and
Conveyance on which the Purchaser from time to time shall purchase and the
Seller from time to time shall sell, the Mortgage Loans listed on the related
Mortgage Loan Schedule.
Closing Documents: The documents required pursuant to Section 8.01.
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.
Custodial Account: The separate account or accounts created and maintained
pursuant to Section 10.09.
Custodial Agreement: That certain Custodial Agreement, dated as of
September 1, 1999 by and between the Purchaser and U.S. Bank Trust National
Association, as amended.
Custodian: The Custodian under the Custodial Agreement, or its successor
in interest or assigns or any successor to the Custodian under the Custodial
Agreement as provided therein.
Customary Servicing Procedures: With respect to any Mortgage Loan, those
procedures (including collection procedures) that Seller customarily employs and
exercises in servicing and administering mortgage loans for its own account and
which are in accordance with accepted mortgage servicing practices of prudent
lending institutions which service mortgage loans of the
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same type as such Mortgage Loans in the jurisdiction where the related Mortgage
Property is located.
Cut-off Date: The first day of the month in which the related Closing Date
occurs.
Deleted Mortgage Loan: A Mortgage Loan replaced or to be replaced with a
Qualified Substitute Mortgage Loan in accordance with this Agreement.
Determination Date: The sixteenth (16th) day, or if such sixteenth (16th)
day is not a Business Day, the Business Day immediately preceding such sixteenth
(16th) day, of the month of the related Remittance Date.
Due Date: The day of the month of the related Remittance Date on which
each Monthly Payment is due on a Mortgage Loan, exclusive of any days of grace.
Due Period: With respect to each Remittance Date, the period beginning on
the second day of the month preceding the month of the Remittance Date, and
ending on the first day of the month in which the Remittance Date occurs.
Errors and Omissions Insurance Policy: An errors and omissions insurance
policy to be maintained by the Seller pursuant to Section 10.16.
Escrow Account: The separate account or accounts created and maintained
pursuant to Section 10.11.
Escrow Payments: The amounts constituting ground rents, taxes,
assessments, water rates, PMI premiums, fire and hazard insurance premiums and
other payments required to be escrowed by the Mortgagor with the mortgagee
pursuant to any Mortgage Loan.
Event of Default: Any one of the conditions or circumstances enumerated in
Section 14.01.
Xxxxxx Xxx: The Federal National Mortgage Association or any successor
thereto.
Xxxxxx Mae Guides: The Xxxxxx Xxx Xxxxxxx' Guide and the Xxxxxx Mae
Servicers' Guide and all amendments or additions thereto.
FDIC: The Federal Deposit Insurance Corporation or any successor
organization.
Fidelity Bond: A fidelity bond required to be obtained by Seller pursuant
to Section 10.16.
FICO Score: A statistical credit score obtained by mortgage lenders in
connection with the loan application to help assess a borrower's credit
worthiness.
First Remittance Date: June 18, 2004.
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Xxxxxxx Mac: The Federal Home Loan Mortgage Corporation, or any successor
thereto
Initial Closing Date: May 25, 2004, or other such date as may be mutually
agreed to by Seller.
Initial Purchaser: Xxxxxx Brothers Bank, FSB.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.
Liquidating Loan: A Mortgage Loan as to which, prior to the close of
business on the Business Day next preceding the Due Date, (a) has become an REO
Property or (b) Seller and the Mortgagor have agreed in writing that Seller will
accept a deed to the related Mortgaged Property in lieu of foreclosure in whole
or partial satisfaction of the Mortgage Loan.
Liquidation Proceeds: Cash (other than REO Disposition Proceeds) received
in connection with the liquidation of a defaulted Mortgage Loan, whether through
the sale or assignment of the Mortgage Loan, trustee's sale, foreclosure sale or
otherwise.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan, the
original principal balance of such Mortgage Loan divided by the Appraised Value
of the related Mortgaged Property.
MERS(R) System: The electronice system of recording transfers of
mortgages maintained by the Mortgage Electronic Registration Systems, Inc. or
any successor or assigns thereof.
Monthly Advance: The portion of Monthly Payment delinquent with respect to
each Mortgage Loan at the close of business on the Determination Date required
to be advanced by the Seller pursuant to Section 11.03 on the Business Day
immediately preceding the Remittance Date of the related month.
Monthly Payment: With respect to any Mortgage Loan, the scheduled combined
payment of principal and interest payable by a Mortgagor under the related
Mortgage Note on each Due Date.
Mortgage: The mortgage, deed of trust or other instrument creating a first
lien on, or first priority ownership interest in, an estate in fee simple in
real property securing a Mortgage Note, including any rider incorporated by
reference therein.
Mortgagee: The mortgagee or beneficiary named in the Mortgage and the
successors and assigns of such mortgagee or beneficiary.
Mortgage File: The mortgage documents pertaining to a particular Mortgage
Loan which are specified in Exhibit A hereto and any additional documents
required to be added to the Mortgage File pursuant to this Agreement.
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Mortgage Interest Rate: With respect to each Mortgage Loan, the annual
rate at which interest accrues on such Mortgage Loan from time to time in
accordance with the provisions of the related Mortgage Note.
Mortgage Loan: An individual mortgage loan which is the subject of this
Agreement, each mortgage loan originally sold and subject to this Agreement
being identified on the Mortgage Loan Schedule. The term Mortgage Loan includes,
without limitation, the contents of the Mortgage File, the Monthly Payments,
Principal Prepayments, Liquidation Proceeds, Insurance Proceeds, Condemnation
Proceeds, REO Disposition Proceeds and all other rights, benefits, proceeds and
obligations arising from or in connection with such Mortgage Loan.
Mortgage Loan Documents: The documents listed in Exhibit H hereto
pertaining to any Mortgage Loan.
Mortgage Loan Package: A pool of Mortgage Loans listed on a Mortgage Loan
Schedule and sold to the Purchaser by the Seller on a Closing Date.
Mortgage Loan Remittance Rate: As to each Mortgage Loan, the annual rate
of interest payable to Purchaser, which shall be equal to the related Mortgage
Interest Rate minus the related Servicing Fee Rate.
Mortgage Loan Schedule: With respect to each Mortgage Loan Package, the
schedule of Mortgage Loans to be annexed hereto as Exhibit F on each Closing
Date, such schedule setting forth the information agreed to by the parties
hereto.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.
Mortgaged Property: The real property securing repayment of the debt
evidenced by a Mortgage Note, consisting of a single parcel of property
considered to be real estate under the law of the state in which it is located
improved by a residential dwelling.
Mortgagor: The obligor on a Mortgage Note.
Officers' Certificate: A certificate signed by the Chairman of the Board
or the Vice Chairman of the Board or the President, a Senior Vice President or a
Vice President and by the Treasurer or the Secretary or one of the Assistant
Treasurers or Assistant Secretaries of Seller, or by other duly authorized
officers or agents of Seller and delivered to Purchaser as required by this
Agreement.
Opinion of Counsel: A written opinion of counsel who may be an employee of
CitiMortgage reasonably acceptable to the Purchaser.
Pass-Through Transfer: The sale or transfer of some or all of the Mortgage
Loans to a trust to be formed as part of a publicly-issued and/or privately
placed, rated or unrated, mortgage
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pass-through transaction, retaining the Seller as "servicer" (with or without a
master servicer) thereunder.
Person: Any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
PMI: Private mortgage insurance.
Prepayment Interest Shortfall Amount: With respect to any Mortgage Loan
that was subject to a Principal Prepayment in full or in part during any Due
Period, which Principal Prepayment was applied to such Mortgage Loan prior to
such Mortgage Loan's Due Date in such Due Period, the amount of interest (net
the related Servicing Fee) that would have accrued on the amount of such
Principal Prepayment during the period commencing on the date as of which such
Principal Prepayment was applied to such Mortgage Loan and ending on the day
immediately preceding such Due Date, inclusive.
Principal Prepayment: Any payment or other recovery of principal on a
Mortgage Loan which is received in advance of its scheduled Due Date and is not
accompanied by an amount of interest representing scheduled interest due on any
date or dates in any month or months subsequent to the month of prepayment.
Purchase Price: The price paid on the Closing Date by Purchaser to Seller
in exchange for the Mortgage Loans purchased on the Closing Date as calculated
as provided in Section 4.01.
Purchase Price and Terms Letter: With respect to each purchase of a
Mortgage Loan Package hereunder, that certain letter agreement setting forth the
general terms and conditions of such transaction contemplated herein and
identifying the Mortgage Loans to be purchased hereunder, by and between the
Seller and the Purchaser.
Purchase Price Percentage: As defined in Section 4.01.
Purchaser: The Initial Purchaser and any subsequent permitted holder or
holders of the Mortgage Loans.
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 Corporation.
Qualified Insurer: Any insurer acceptable to Seller and qualified to do
business in the state in which any related Mortgaged Property is located.
Qualified Substitute Mortgage Loan: A mortgage loan substituted by Seller
for a Deleted Mortgage Loan which must, on the date of such substitution, (a)
have an outstanding principal balance, after deduction of all scheduled payments
due in the month of substitution (or in the case of a substitution of more than
one mortgage loan for a Deleted Mortgage Loan, an aggregate
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principal balance), not in excess of the Stated Principal Balance of the Deleted
Mortgage Loan (the amount of any shortfall will be distributed by Seller to
Purchaser in the month of substitution), (b) have a Mortgage Interest Rate equal
to the Mortgage Interest Rate of the Deleted Mortgage Loan, (c) have a remaining
term to maturity not greater than (and not more than one year less than) that of
the Deleted Mortgage Loan, and (d) comply as of the date of substitution with
each representation and warranty set forth in Section 6.01, and 6.02 and (e) be
a REMIC Eligible Mortgage Loan.
Rating Agency: Any of Fitch, Xxxxx'x or Standard & Poor's or their
respective successors designed by the Purchaser.
Reconstitution: A Pass-Through Transfer, a Whole Loan Transfer or an
Agency Transfer.
Reconstitution Agreements: The agreement or agreements entered into by the
Seller and the Purchaser and/or certain third parties on the Reconstitution Date
or Dates with respect to any or all of the Mortgage Loans serviced hereunder, in
connection with a Reconstitution as provided in Article 5.
Reconstitution Date: The date or dates on which any or all of the Mortgage
Loans serviced under this Agreement shall be removed from this Agreement and
reconstituted as part of a Reconstitution pursuant to Article 5 hereof.
Record Date: The close of business of the last Business Day of the month
preceding the month of the related Remittance Date.
Refinanced Mortgage Loan: A Mortgage Loan the proceeds of which were not
used to purchase the related Mortgaged Property.
REMIC: A "real estate mortgage investment conduit" within the meaning of
Section 860D of the Code.
REMIC Eligible Mortgage Loan: A Mortgage Loan held by a REMIC which
satisfies and/or complies with all applicable REMIC Provisions.
REMIC Provisions: Provisions of the federal income tax law relating to a
REMIC, which appear at Section 860A through 86OG of Subchapter M of Chapter 1,
Subtitle A of the Code, and related provisions, and regulations, rulings or
pronouncements promulgated thereunder, as the foregoing may be in effect from
time to time.
Remittance Date: The eighteenth (18th) day of any month, , or if such
eighteenth (18th) day is not a Business Day, the first Business Day immediately
following such eighteenth (18th) day beginning with the First Remittance Date.
REO Account: The account or accounts maintained pursuant to Section 10.17.
REO Disposition: The final sale by Seller of a Mortgaged Property acquired
by Seller in foreclosure or by deed in lieu of foreclosure.
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REO Disposition Proceeds: All amounts received with respect to an REO
Disposition pursuant to Section 10.17.
REO Property: A Mortgaged Property acquired by Seller through foreclosure
or deed in lieu of foreclosure, as described in Section 10.17.
Repurchase Price: With respect to any Mortgage Loan, a price equal to (a)
the product referenced in the Purchase Price and Terms Letter, plus (b) interest
on such Stated Principal Balance at a rate equal to the Mortgage Loan Remittance
Rate from the date to which interest has last been paid and distributed to
Purchaser to the first day of the month following the month of repurchase, less
amounts received or advanced in respect of such repurchased Mortgage Loan which
are being held in the Custodial Account for distribution in the month of
repurchase plus (c) any costs and damages incurred by the Purchaser or related
trust with respect to any securitization of the Mortgage Loan in connection with
any violation by such Mortgage Loan of any predatory- or abusive-lending law.
SAIF: The Savings Association Insurance Fund, or any successor thereto.
Securities Act of 1933 or the 1933 Act: The Securities Act of 1933, as
amended.
Seller: CitiMortgage, Inc., its successors and assigns.
Servicing Advances: All customary, reasonable and necessary out-of-pocket
costs and expenses incurred in the performance by Seller of its servicing
obligations, including, but not limited to, the cost of (a) the inspection,
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 10.13.
Servicing Fee: With respect to each Mortgage Loan, the amount of the
annual fee Purchaser shall pay to Seller, which shall, for each month, be equal
to one-twelfth of the product of (a) the Servicing Fee Rate and (b) the
outstanding principal balance of such Mortgage Loan. Such fee shall be payable
monthly, computed on the basis of the same principal amount and period
respecting which any related interest payment on a Mortgage Loan is computed.
The obligation of Purchaser to pay the Servicing Fee is limited to, and payable
solely from, the interest portion (including recoveries with respect to interest
from Liquidation Proceeds and other proceeds, to the extent permitted by Section
10.10) of related Monthly Payments collected by Seller, or as otherwise provided
under Section 10.10.
Servicing Fee Rate: With respect to each Mortgage Loan and each Mortgage
Loan Package, the Servicing Fee Rate set forth in the related Assignment and
Conveyance.
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
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Custodian and copies of the Mortgage Loan Documents listed in Exhibit H the
originals of which are delivered to the Custodian pursuant to Section 5.03.
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.
Stated Principal Balance: As to each Mortgage Loan, (a) the principal
balance of the Mortgage Loan at the Cut-off Date after giving effect to payments
of principal due on or before such date, whether or not received, minus (b) all
amounts previously distributed to Purchaser with respect to the Mortgage Loan
representing payments or recoveries of principal, or advances in lieu thereof.
Subservicer: Any mortgage loan servicing institution other than Seller
which is responsible for the servicing and administration of any Mortgage Loan
or any successor appointed pursuant to any Subservicing Agreement.
Subservicing Account: As defined in Section 10.06.
Subservicing Agreement: Each agreement providing for the servicing of any
of the Mortgage Loans by a Subservicer.
Subservicing Fee: As to each Mortgage Loan, the monthly fee payable to the
Subservicer, paid by Seller from its Servicing Fee.
Underwriting Guidelines: The underwriting guidelines of the Seller which
are subject to change from time to time.
Whole Loan Transfer: The sale or transfer of some or all of the Mortgage
Loans to a third party purchaser in a whole loan transaction.
Section 1.02 General Interpretive Principles.
For purposes of this Agreement, except as otherwise expressly provided or
unless the context otherwise requires:
(a) the terms defined in this Agreement have the meanings assigned to
them in this Agreement and include the plural as well as the
singular, and the use of any gender herein shall be deemed to
include the other gender;
(b) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting
principles;
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(c) references herein to "Articles", "Sections", "Subsections",
"Paragraphs", and other subdivisions without reference to a document
are to designated Articles, Sections, Subsections, Paragraphs and
other subdivisions of this Agreement;
(d) a reference to a Subsection without further reference to a Section
is a reference to such Subsection as contained in the same Section
in which the reference appears, and this rule shall also apply to
Paragraphs and other subdivisions;
(e) the words "herein", "hereof", "hereunder" and other words of similar
import refer to this Agreement as a whole and not to any particular
provision; and
(f) the term "include" or "including" shall mean without limitation by
reason of enumeration.
ARTICLE II
AGREEMENT TO PURCHASE
Section 2.01 Agreement to Purchase.
The Seller agrees to sell, and the Purchaser agrees to purchase, from
time-to-time, on a servicing-retained basis, Mortgage Loans having an aggregate
principal balance on the related Cut-off Date in an amount as set forth in the
related Purchase Price and Terms Letter, or in such other amount as agreed by
the Purchaser and the Seller as evidenced by the actual aggregate principal
balance of the Mortgage Loans accepted by the Purchaser on the related Closing
Date.
ARTICLE III
MORTGAGE LOAN SCHEDULE
Section 3.01 Mortgage Loan Schedule.
With respect to each Mortgage Loan Package, Seller shall deliver the
Mortgage Loan Schedule to Purchaser at least five (5) Business Days prior to the
related Closing Date.
ARTICLE IV
PURCHASE PRICE
Section 4.01 Purchase Price.
The Purchase Price for the Mortgage Loans in each Mortgage Loan Package
shall be the percentage of par as stated in the related Purchase Price and Terms
Letter ( the "Purchase Price Percentage") multiplied by the aggregate Stated
Principal Balance of the Mortgage Loans, as of
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the related Cut-off Date. Purchaser will pay to Seller accrued interest on the
Stated Principal Balance of each Mortgage Loan as of the related Cut-off Date at
its Mortgage Loan Remittance Rate from the related Cut-off Date up to and
including the day preceding the related Closing Date, prorated on the basis of a
360 day year consisting of twelve (12) months of thirty (30) days each.
Purchaser shall own and be entitled to receive with respect to each
Mortgage Loan purchased, (a) all scheduled principal due after the Cut-off Date,
(b) all other recoveries of principal collected after the Cut-off Date
(provided, however, that all scheduled payments of principal due on or before
the Cut-off Date and collected by Seller after the Cut-off Date shall belong to
Seller), and (c) all payments of interest on the Mortgage Loans net of the
Servicing Fee (minus that portion of any such interest payment that is allocable
to the period prior to the Cut-off Date). The Stated Principal Balance of each
Mortgage Loan as of the Cut-off Date is determined after application to the
reduction of principal of payments of principal due on or before the Cut-off
Date whether or not collected. Therefore, for the purposes of this Agreement,
payments of scheduled principal and interest prepaid for a Due Date beyond the
Cut-off Date shall not be applied to the principal balance as of the Cut-off
Date. Such prepaid amounts (minus the applicable Servicing Fee) shall be the
property of Purchaser. Seller shall deposit any such prepaid amounts into the
Custodial Account, which account is established for the benefit of Purchaser,
for remittance by Seller to Purchaser on the first Remittance Date. All payments
of principal and interest, less the applicable Servicing Fee, due on a Due Date
following the Cut-off Date shall belong to Purchaser.
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ARTICLE V
CONVEYANCE OF MORTGAGE LOANS; POSSESSION OF MORTGAGE FILES;
BOOKS AND RECORDS; DELIVERY OF MORTGAGE
LOAN DOCUMENTS; TRANSFER OF MORTGAGE LOANS
Section 5.01 Conveyance of Mortgage Loans; Possession of Mortgage Files.
Seller, on the related Closing Date, does hereby sell, transfer,
assign, set over and convey to Purchaser, without recourse, but subject to the
terms of this Agreement, all the right, title and interest of Seller in and to
the Mortgage Loans in the related Mortgage Loan Package, and Mortgage Files and
all rights and obligations arising under the documents contained therein for
each Mortgage Loan in the related Mortgage Loan Package. Pursuant to Section
5.03, the Seller shall deliver the Mortgage Loan Documents for each Mortgage
Loan to the Custodian prior to the related Closing Date.
The contents of each Mortgage File not delivered to the Custodian are and
shall be held in trust by Seller for the benefit of Purchaser as the owner
thereof. The Seller shall maintain a Servicing File consisting of a copy of the
contents of each Mortgage File and the originals of the documents in each
Mortgage File not delivered to the Custodian. Seller's possession of the portion
of each Servicing File so retained is for the sole purpose of servicing the
related Mortgage Loan, and such retention and possession by Seller is in a
custodial capacity only. Upon the purchase of the Mortgage Loans, the ownership
of each Mortgage Note, Mortgage and each related Mortgage File is vested in
Purchaser and the ownership of all records and documents with respect to each
related Mortgage Loan prepared by or which come into the possession of Seller
shall immediately vest in Purchaser and shall be retained and maintained, in
trust, by Seller in such custodial capacity only. The portion of each Mortgage
File so retained shall be appropriately marked to clearly reflect the sale of
the related Mortgage Loan to Purchaser. Seller shall release from its custody
the contents of any Mortgage File only in accordance with written instructions
from Purchaser, unless such release is required as incidental to Seller's
servicing of the Mortgage Loans or is in connection with a repurchase of any
Mortgage Loan pursuant to Section 6.03, 6.04 and 12.02.
Section 5.02 Books and Records.
From and after the sale of the Mortgage Loans to the Purchaser, all rights
arising out of the Mortgage Loans including, but not limited to, all funds
received on or in connection with a Mortgage Loan shall be held by Seller in
trust for the benefit of Purchaser as the owner of the Mortgage Loans and the
Seller shall retain record title to the related Mortgages for the sole purpose
of facilitating the servicing and the supervision of the servicing of the
Mortgage Loans.
The sale of each Mortgage Loan shall be reflected on Seller's balance
sheet and other financial statements as a sale of assets by Seller. Seller shall
be responsible for maintaining, and
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shall maintain, a complete set of books and records for each Mortgage Loan which
shall be clearly marked to reflect the ownership of each Mortgage Loan by
Purchaser in Seller's computer system. In particular, the Seller shall maintain
in its possession, available for inspection by the Purchaser, or its designee
and shall deliver to the Purchaser upon demand, evidence of compliance with all
federal, state and local laws, rules and regulations
The Seller shall maintain with respect to each Mortgage Loan and shall
make available for inspection during Seller's normal business hours and upon
reasonable notice by any Purchaser or its designee the related Servicing File
during the time the Purchaser retains ownership of a Mortgage Loan and
thereafter in accordance with applicable laws and regulations.
Section 5.03 Delivery of Mortgage Loan Documents.
On or before the date which is agreed upon by the Purchaser and the Seller
in the related Purchase Price and Terms Letter, the Seller shall deliver to
Purchaser or the Custodian, as directed by Purchaser, the Mortgage Loan
Documents as required by Exhibit H hereto for each Mortgage Loan in the Mortgage
Loan Package.
On or prior to the related Closing Date, the Custodian shall certify its
receipt of all such Mortgage Loan Documents required to be delivered pursuant to
the Custodial Agreement, as evidenced by the Initial Certification of the
Custodian in the form annexed to the Custodial Agreement. Purchaser shall pay
all fees and expenses of the Custodian
Seller shall forward to Purchaser or its designee, original documents
evidencing an assumption, modification, consolidation or extension of any
Mortgage Loan entered into in accordance with this Agreement within two (2)
weeks of their execution; provided, however, that Seller shall provide Purchaser
or its designee, with a certified true copy of any such document submitted for
recordation within two (2) weeks of its execution, and shall provide the
original of any document submitted for recordation or a copy of such document
certified by the appropriate public recording office to be a true and complete
copy of the original within 180 days of its submission for recordation. In the
event Seller cannot deliver the original of such documents submitted for
recording due to a delay by the recording office in the applicable jurisdiction,
Seller shall instead deliver a recording receipt of such recording office or, if
such recording receipt is not available, an Officer's Certificate from Seller
confirming that such documents have been accepted for recording. Any such
document shall be delivered to Purchaser or its designee promptly upon receipt
thereof from the related recording office.
From time to time Purchaser shall deliver or cause to be delivered to
Seller, as soon as practicable following receipt of a written request from
Seller and at no expense to Seller, any Mortgage Loan Document needed by Seller
in connection with the servicing of a Mortgage Loan. Seller's request for the
release of a Mortgage Loan Document shall specify in reasonable detail the
reason for Seller's request. During the time that any such Mortgage Loan
Document is in the possession of Seller, such possession shall be deemed to be
in trust for the benefit of Purchaser and Seller shall promptly return to
Purchaser or its designee any Mortgage Loan Document so released when Seller's
need for such Mortgage Loan Document no longer exists. Purchaser shall indemnify
and hold Seller harmless against any and all claims, losses, damages,
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penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments, and any other costs, fees and expenses that Seller may sustain
in connection with any third party claim in any way related to Purchaser's or
its designee's failure to release, in a timely manner, the Mortgage Loan
Documents requested by Seller. Purchaser shall pay all costs, fees and expenses
in connection with the possession of the Mortgage Loan Documents.
Purchaser shall provide Seller with written notice at least fifteen (15)
days prior to any transfer of the Mortgage Loan Documents.
Section 5.04 Transfer of Mortgage Loans.
The Initial Purchaser shall have the right, without the consent of Seller,
to assign its interest under this Agreement with respect to all or some of the
Mortgage Loans, and designate any person to exercise any rights of Purchaser
hereunder, and the assignee or designee shall accede to the rights and
obligations hereunder of Purchaser with respect to such Mortgage Loans;
provided, however, that Seller shall not be required to recognize any assignment
to the extent that it would result in Mortgage Loans in a Mortgage Loan Package
being serviced for more than four (4) separate Reconstitutions, which will be
reconstituted with no more than four (4) separate and distinct investors/master
servicers at any point in time hereunder. All references to Purchaser shall be
deemed to include its assignee or designee.
Seller shall keep at its servicing office books and records in which,
subject to such reasonable regulations as it may prescribe, Seller shall note
transfers of the Mortgage Loans. No transfer of the Mortgage Loans may be made
unless such transfer is in compliance with the terms hereof. For the purposes of
this Agreement, 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 Purchaser of the Mortgage Loans. Purchaser may, subject to
the terms of this Agreement, sell and transfer, in whole or in part, the
Mortgage Loans, provided that no such sale and transfer shall be binding upon
Seller unless such transferee shall agree in writing in the form of Assignment,
Assumption and Recognition Agreement attached hereto as Exhibit G, to be bound
by the terms of this Agreement and an executed copy of such Assignment,
Assumption and Recognition Agreement shall have been delivered to Seller. Upon
receipt thereof, Seller shall xxxx its books and records to reflect the
ownership of the Mortgage Loans by such assignee, and the previous Purchaser
shall be released from its obligations hereunder to the extent such obligations
relate to Mortgage Loans sold by Purchaser. This Agreement shall be binding upon
and inure to the benefit of Purchaser and Seller and their respective permitted
successors, assignees and designees.
Section 5.05 Whole Loan Transfers, Agency Transfers or Pass-Through
Transfers.
Seller and Purchaser agree that with respect to some or all of the
Mortgage Loans, upon written notice to Seller at least eleven (11) days prior to
the first Due Period of such Whole Loan Transfer, Agency Transfer or Pass
Through-Transfer, provided Purchaser provides to Seller all information included
on Exhibit K hereto with such notice, Purchaser may effect either one or more
Whole Loan Transfers, and/or one or more Pass-Through Transfers.
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(a) Whole Loan Transfers. With respect to each Whole Loan Transfer
entered into by Purchaser, Seller agrees:
(i) to cooperate reasonably with Purchaser and any prospective
purchaser with respect to all reasonable requests; and
(ii) to execute or acknowledge, at Purchaser's discretion, an
assignment in the form of Exhibit G by Purchaser to a
successor purchaser of some or all of the Mortgage Loans,
which Mortgage Loans will be assigned subject to the
representations and warranties set forth in this Agreement and
covenants to service the Mortgage Loans on behalf of the
successor purchaser in accordance with the terms and
conditions of this Agreement or otherwise.
(b) Pass Through Transfers and Agency Transfers. Purchaser and Seller
agree that in connection with the completion of a Pass-Through
Transfer or Agency Transfer, Seller shall:
(i) if Seller is required to be a party to any of the
Reconstitution Agreements, execute any Reconstitution
Agreement required to effectuate the foregoing;
(ii) provide, at Purchaser's expense, to any master servicer or
trustee, as applicable, and/or Purchaser any and all publicly
available information and appropriate verification of
information which may be reasonably available to Seller,
whether through letters of its auditors or otherwise, as
Purchaser, trustee or a master servicer shall reasonably
request as to the related Mortgage Loans;
(iii) agree to service the Mortgage Loans in accordance with the
requirements of this Agreement or in accordance with the
requirements of FNMA, or any successor thereto, or FHLMC, or
any successor thereto; subject to such waivers, variances, and
modifications as may be agreed to between FNMA or FHLMC, as
the case may be, the Seller and the master servicer; and
(iv) to cooperate fully with the Purchaser, Xxxxxx Mae, Xxxxxxx
Mac, the trustee or a third party purchaser and any
prospective Purchaser, at the Purchaser's expense, with
respect to all reasonable requests and due diligence
procedures including participating in meetings with rating
agencies, Xxxxxx Mae, Xxxxxxx Mac, bond insurers, guarantors,
and such other parties as the Purchaser shall designate and
participating in meetings with prospective purchasers of the
Mortgage Loans or interests therein and providing information
contained in the Mortgage Loan Schedule including any diskette
or other related data tapes provided as reasonably requested
by such Purchasers;
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(v) to deliver to the Purchaser and to any Person designated by
the Purchaser (a) for inclusion in any prospectus or other
offering material such publicly available information
regarding the Seller, its financial condition and its mortgage
loan delinquency, foreclosure and loss experience and any
additional information requested by the Purchaser, (b) any
similar non-public, unaudited financial information (which the
Purchaser may, at its option and at its cost, have audited by
certified public accountants) and such other information as is
reasonably requested by the Purchaser and which the Seller is
capable of providing without unreasonable effort or expense,
and to indemnify,through an indemnification agreement, the
Purchaser and its affiliates for material misstatements
contained in such information, and if such indemnification
from the Seller is provided, the Purchaser shall indemnify the
Seller for material misstatements contained in such prospectus
or offering material that was not provided by the Seller and
(c) such statements and audit letters of reputable, certified
public accountants pertaining to information provided by the
Seller pursuant to clause (a) above as shall be reasonably
requested by the Purchaser; and
(vi) provide all other assistance reasonably requested by Purchaser
in connection with completion of the Pass Through Transfer.
(c) With respect to any Pass-Through Transfer or Agency Transfer,
Purchaser shall be entitled to include in any disclosure document
any unaltered information specifically requested by Purchaser for
this purpose and provided by Seller and Seller acknowledges and
agrees that the related investors will be permitted to rely on such
information. If Purchaser determines that Seller is required to be a
party to any reconstitution agreement, Seller shall execute such
reconstitution agreement within a reasonable period of time, but in
no event shall such time exceed ten (10) Business Days after mutual
agreement between Purchaser and Seller as to the terms thereof.
(d) All of the Mortgage Loans, including those Mortgage Loans that are
subject to a Pass-Through Transfer, Agency Transfer or a Whole Loan
Transfer, shall continue to be subject to this Agreement, and with
respect thereto, this Agreement shall remain in full force and
effect. In no event shall a Whole Loan Transfer, Agency Transfer or
a Pass-Through Transfer be deemed to relieve the Seller of its
obligations as set forth in Article VI hereof nor to increase the
Seller's liabilities, duties, obligations, or responsibilities as
set forth in this Agreement.
All Mortgage Loans not sold or transferred pursuant to an Agency Transfer,
Pass-Through Transfer or Whole Loan Transfer and any and all Mortgage Loans
repurchased by the Purchaser pursuant to Section 5.06 below with respect to an
Agency Transfer, Pass-Through Transfer or Whole Loan Transfer shall be subject
to this Agreement and shall continue to be serviced in accordance with the terms
of this Agreement and with respect thereto this Agreement shall remain in full
force and effect. All Mortgage Loans not sold or transferred pursuant to an
Agency Transfer or Pass-Through Transfer and any Mortgage Loans repurchased by
the Purchaser pursuant to
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Section 6.03 of this Agreement or otherwise directly or indirectly reacquired by
the Purchaser or its designee upon termination of an Agency Transfer or
Pass-Through Transfer, shall be subject to this Agreement and shall continue to
be serviced in accordance with the terms of this Agreement and with respect
thereto this Agreement shall remain in full force and effect.
If required at any time by the Rating Agencies, Purchaser or successor
Purchaser in connection with any Agency Transfer, Pass-Through Transfer or Whole
Loan Transfer, the Seller shall deliver such additional documents from its
Servicing File within 10 days if provided in an electronic format and within 10
business days for a hard copy, to the Custodian, successor Purchaser or other
designee of the Purchaser as the Rating Agencies, Purchaser or successor
Purchaser may reasonably require.
Section 5.06 Purchaser's Repurchase and Indemnification Obligations.
Upon receipt by the Seller of notice from Xxxxxx Mae, Xxxxxxx Mac or
the trustee of a breach of any Purchaser representation or warranty contained in
any Reconstitution Agreement or a request by Xxxxxx Mae, Xxxxxxx Mac or the
trustee, as the case may be, for the repurchase of any Mortgage Loan transferred
to Xxxxxx Mae or Xxxxxxx Mac pursuant to an Agency Transfer or to a trustee
pursuant to a Pass-Through Transfer, the Seller shall promptly notify the
Purchaser of same and shall, at the direction of the Purchaser, use its best
efforts to cure and correct any such breach and to satisfy the requests or
concerns of Xxxxxx Mae, Xxxxxxx Mac, or the trustee related to such deficiencies
of the related Mortgage Loans transferred to Xxxxxx Mae, Xxxxxxx Mac, or the
trustee.
The Purchaser shall repurchase from the Seller any Mortgage Loan
transferred to Xxxxxx Mae or Xxxxxxx Mac pursuant to an Agency Transfer or to a
trustee pursuant to a Pass-Through Transfer with respect to which the Seller has
been required by Xxxxxx Mae, Xxxxxxx Mac, or the trustee to repurchase due to a
breach of a representation or warranty made by the Purchaser with respect to the
Mortgage Loans, or the servicing thereof prior to the transfer date to Xxxxxx
Mae, Xxxxxxx Mac, or the trustee in any Reconstitution Agreement and not due to
a breach of the Seller's representations or obligations thereunder or pursuant
to this Agreement. The repurchase price to be paid by the Purchaser to the
Seller shall equal that repurchase price paid by the Seller to Xxxxxx Mae,
Xxxxxxx Mac, or the third party purchaser plus all reasonable costs and expenses
borne by the Seller in connection with the cure of said breach of a
representation or warranty made by the Purchaser and in connection with the
repurchase of such Mortgage Loan from Xxxxxx Mae, Xxxxxxx Mac, or the trustee,
including, but not limited to, reasonable and necessary attorneys' fees.
At the time of repurchase, the Custodian and the Seller shall
arrange for the reassignment of the repurchased Mortgage Loan to the Purchaser
according to the Purchaser's instructions and the delivery to the Custodian of
any documents held by Xxxxxx Mae, Xxxxxxx Mac, or the trustee with respect to
the repurchased Mortgage Loan pursuant to the related Reconstitution Agreement.
In the event of a repurchase, the Seller shall, simultaneously with such
reassignment, give written notice to the Purchaser that such repurchase has
taken place, and amend the related Mortgage Loan Schedule to reflect the
addition of the repurchased Mortgage Loan to this Agreement. In connection with
any such addition, the Seller and the Purchaser shall
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be deemed to have made as to such repurchased Mortgage Loan the representations
and warranties set forth in this Agreement.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES;
REMEDIES FOR BREACH
Section 6.01 Representations and Warranties Regarding Individual Mortgage
Loans.
Seller hereby represents and warrants to Purchaser that, as to each
Mortgage Loan, as of the related Closing Date (or such other date as may be
specified herein):
(a) The information set forth on the Mortgage Loan Schedule and the
magnetic tape or diskette delivered to Purchaser by Seller is
complete, true and correct as of the Cut-off Date;
(b) The Mortgage Note and the Mortgage have not been assigned or
pledged, and Seller has good and marketable title thereto, and
Seller is the sole owner and holder of the Mortgage Loan free and
clear of any and all liens, claims, encumbrances, participation
interests, equities, pledges, charges or security interests of any
nature and has full right and authority, subject to no interest or
participation of, or agreement with, any other party, to sell and
assign the same pursuant to this Agreement;
(c) The Mortgage is a valid and subsisting first lien on the property
therein described, and the Mortgaged Property is free and clear of
any and all adverse claims, encumbrances and liens having priority
over the first lien of the Mortgage except for (i) liens for real
estate taxes and special assessments not yet due and payable, (ii)
covenants, conditions and restrictions, rights of way, easements and
other matters of public record as of the date of recording being
acceptable to mortgage lending institutions generally and
specifically referred to in the lender's title insurance policy
delivered to the originator of the Mortgage Loan and which do not
adversely affect the Appraised Value of the Mortgaged Property, and
(iii) other matters to which like properties are commonly subject
which do not materially interfere with the benefits of the security
intended to be provided by the Mortgage or the use, enjoyment, value
or marketability of the related Mortgaged Property. Any security
agreement, chattel mortgage or equivalent document related to the
Mortgage and delivered to Purchaser establishes in Seller a valid
and subsisting first lien on the property described therein, and
Seller has full right to sell and assign the same to Purchaser;
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(d) The terms of the Mortgage Note and the Mortgage have not been
impaired, waived, altered or modified in any respect, except by a
written instrument which has been recorded, if required by law, or,
if necessary, to protect the interest of Purchaser. The substance of
any such alteration or modification is reflected on the Mortgage
Loan Schedule and has been approved by the private mortgage guaranty
insurer, if any;
(e) No instrument of release, alteration, modification or waiver has
been executed in connection with the Mortgage Loan, and no Mortgagor
has been released, in whole or in part, except in connection with an
assumption agreement which has been approved by the private mortgage
guaranty insurer, if any, and except such Mortgage Loan which
contains in the related Mortgage File evidence of a release or
waiver or an assumption agreement discharging the original borrower
from all of the debt obligations in connection with the related
Mortgage Loan and providing for the assumption of all such debt
obligations by the party assuming the obligations under the Mortgage
Loan and, in each case, terms of which are reflected in the Mortgage
Loan Schedule;
(f) Except as permitted in clause (l) and as to any defaults regarding
payment of the Mortgage Note, there are no defaults in complying
with the terms of the Mortgage, and, all taxes, governmental
assessments, insurance premiums, water, sewer and municipal charges,
leasehold payments or ground rents which previously became due and
owing have been paid, or an escrow of funds has been established in
an amount sufficient to pay for every such item which remains unpaid
and which has been assessed but is not yet due and payable. Seller
has not advanced funds, or induced, solicited or knowingly received
any advance of funds by a party other than the Mortgagor, directly
or indirectly, for the payment of any amount required by the
Mortgage Note or Mortgage, except for interest accruing from the
date of the Mortgage Note or date of disbursement of the Mortgage
proceeds, whichever is greater, to the day which precedes by one
month the Due Date of the first installment of principal and
interest;
(g) There is no proceeding pending or threatened for the total or
partial condemnation of the Mortgaged Property, nor is such a
proceeding currently occurring, and such property is undamaged by
waste, fire, earthquake or earth movement, windstorm, flood, tornado
or other casualty, so as to affect materially and adversely the
value of the Mortgaged Property as security for the Mortgage Loan or
the use for which the premises were intended;
(h) There are no mechanics' or similar liens or claims which have been
filed for work, labor or material (and no rights are outstanding
that under law could give rise to such lien) affecting the Mortgaged
Property which are, or may be, liens prior or equal to, or
coordinate with, the lien of the related Mortgage unless such lien
is insured under the related title insurance policy;
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(i) All improvements which were included for the purpose of determining
the Appraised Value of the Mortgaged Property lie wholly within the
boundaries and building restriction lines of the Mortgaged Property
and, to Seller's knowledge, no improvements on adjoining properties
encroach upon the Mortgaged Property (other than minor encroachments
(i) which do not affect the value of the Mortgage Loan or the
Purchaser's interest therein and (ii) to which properties similar to
the Mortgaged Property within the same jurisdiction are commonly
subject and which do not interfere with the benefits of the security
intended to be provided by the related Mortgage or the use,
enjoyment, value or marketability of the related Mortgaged
Property);
(j) No improvement located on or being part of the Mortgaged Property is
in violation of any applicable zoning law or regulation and all
inspections, licenses and certificates required to be made or issued
with respect to all occupied portions of the Mortgaged Property and,
with respect to the use and occupancy of the same, including but not
limited to certificates of occupancy and fire underwriting
certificates, have been made or obtained from the appropriate
authorities and the Mortgaged Property is lawfully occupied under
applicable law;
(k) All parties which have had any interest in the Mortgage Loan,
whether as mortgagee, assignee, pledgee or otherwise, are (or,
during the period in which they held and disposed of such interest,
were) (i) in compliance with any and all applicable licensing
requirements of the laws of the state wherein the Mortgaged Property
is located, and (ii) either (1) organized under the laws of such
state, or (2) qualified to do business in such state, or (3) federal
savings and loan associations, federal savings banks or national
banks having authorized offices in such state, or (4) not doing
business in such state;
(l) Unless as set forth in the Assignment and Conveyance, no payment
required under any Mortgage Loan has been thirty (30) days or more
delinquent at any time prior to or on the related Cut-off Date;
(m) The Mortgage File contains each of the documents and instruments
specified to be included therein duly executed and in due and proper
form, and each such document or instrument is in form acceptable to
the applicable federal or state regulatory agency, and each Mortgage
Note, Mortgage, and appraisal are on forms acceptable to the
applicable federal or state regulatory agency;
(n) The Mortgage Note and the related Mortgage are genuine, and each is
the legal, valid and binding obligation of the maker thereof,
enforceable in accordance with its terms, except as enforceability
may be limited by applicable bankruptcy, insolvency, reorganization
or other similar laws relating to or affecting the enforcement of
creditors' rights and by general principles of equity. All parties
to the Mortgage Note and the Mortgage had legal capacity to execute
the Mortgage Note and the Mortgage, and each Mortgage Note and
Mortgage have been duly and properly executed by such parties; (o)
As of the date of origination of the
20
Mortgage Loans, any and all requirements of any federal, state or
local law including, without limitation, usury, truth-in-lending,
real estate settlement procedures, consumer credit protection, equal
credit opportunity, disclosure laws and and all applicable predatory
and abusive lending laws or unfair and deceptive practices laws
applicable to the Mortgage Loan have been complied with; and the
Seller shall maintain in its possession, available for the
Purchaser's inspection, and shall deliver to the Purchaser upon
demand, evidence of compliance with all such requirements;
(p) The proceeds of the Mortgage Loan have been fully disbursed, there
is no requirement for future advances thereunder and any and all
requirements as to completion of any on-site or off-site
improvements and as to disbursements of any escrow funds therefor
have been complied with. All costs, fees and expenses incurred in
making or closing Mortgage Loans and the recording of the Mortgage
were paid;
(q) Any future advances made prior to the Cut-off Date have been
consolidated with the outstanding principal amount secured by the
Mortgage, and the secured principal amount, as consolidated, bears a
single interest rate and single repayment term reflected on the
Mortgage Loan Schedule. The lien of the Mortgage securing the
consolidated principal amount is expressly insured as having first
lien priority by a title insurance policy, an endorsement to the
policy insuring the Mortgagee's consolidated interest or by other
title evidence. The consolidated principal amount does not exceed
the original principal amount of the Mortgage Loan;
(r) All improvements upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of
extended coverage and such other hazards as are customary in the
area where the Mortgaged Property is located, pursuant to insurance
policies conforming to the requirements of Section 10.15 hereof. All
individual insurance policies (collectively, the "hazard insurance
policy") are the valid and binding obligation of the insurer and
contain a standard mortgagee clause insuring Seller, its successors
and assigns, as mortgagee. All premiums thereon have been paid. The
Mortgage obligates the Mortgagor thereunder to maintain all such
insurance at the Mortgagor's cost and expense, and upon the
Mortgagor's failure to do so, authorizes the holder of the Mortgage
to obtain and maintain such insurance at the Mortgagor's cost and
expense and to seek reimbursement therefor from the Mortgagor;
(s) There is no default, breach, violation or event of acceleration
existing under the Mortgage or the related Mortgage Note and, to
Seller's knowledge, no event which, with the passage of time or with
notice and the expiration of any grace or cure period, would
constitute a default, breach, violation or event of acceleration;
and Seller has not waived any default, breach, violation or event of
acceleration;
(t) The Mortgage Loan is not subject to any right of rescission,
set-off, counterclaim or defense, including, without limitation, the
defense of usury, nor will the
21
operation of any of the terms of the Mortgage Note or the Mortgage,
or the exercise of any right thereunder, render either the Mortgage
Note or the Mortgage unenforceable, in whole or in part, or subject
to any right of rescission, set-off, counterclaim or defense,
including the defense of usury, and no such right of rescission,
set-off, counterclaim or defense has been asserted with respect
thereto; and no Mortgagor (a) was a debtor in any state or federal
bankruptcy or insolvency proceeding or (b) had a foreclosure
proceeding commenced against him, in each case, at the time the
Mortgage Loan was originated or in the twelve (12) months preceding
the related origination date;
(u) All PMI policies remain in full force and effect with no defaults
thereunder. No action, inaction, or event has occurred and no state
of fact exists or has existed that has resulted, or will result in,
the exclusion from, denial of, or defense to coverage under any
applicable PMI policy irrespective of the cause of such failure of
coverage;
(v) The Mortgage Note is not secured by any collateral, pledged account
or other security except the lien of the corresponding Mortgage and
the security interest of any applicable security agreement or
chattel mortgage referred to in Section 6.01(c);
(w) The Mortgage contains customary and enforceable provisions which
render the rights and remedies of the holder thereof adequate for
the realization against the Mortgaged Property of the benefits of
the security provided thereby, including, (i) in the case of a
Mortgage designated as a deed of trust, by trustee's sale, and (ii)
otherwise by judicial foreclosure, subject only to rights of
redemption, seizure and other laws that would not materially
interfere with the ultimate realization of the benefits of the
security;
(x) No error, omission, misrepresentation, negligence fraud or similar
occurrence with respect to a Mortgage Loan has taken place on the
part of Seller or the Mortgagor or, to the best of Seller's
knowledge, any other party involved in the origination of the
Mortgage Loan; including without limitation the Mortgagor, any
appraiser, any builder or developer, or any other party involved in
the origination of the Mortgage Loan or, in the application of any
insurance in relation to such Mortgage Loan; no predatory or
deceptive lending practices, including, without limitation, the
extension of credit without regard to the ability of the borrower to
repay and the extension of credit which has no apparent benefit to
the borrower, were employed in the origination of the Mortgage Loan;
(y) The Mortgaged Property is a fee simple property located in the state
identified in the Mortgage Loan Schedule and consists of a parcel of
real property with a detached single family residence erected
thereon, two-to-four family dwelling, an individual condominium unit
in a low-rise condominium project, or an individual unit in a
planned unit development, provided, however, that any condominium
project or planned unit development shall conform with the Seller's
Underwriting Guidelines regarding such dwellings, and no residence
or dwelling is a mobile
22
home, a manufactured dwelling, a modular home or rural property. No
portion of the Mortgaged Property is used for commercial purposes;
(z) There exist no deficiencies with respect to escrow deposits and
payments, if such are required, for which customary arrangements for
repayment thereof have not been made, and no escrow deposits or
payments of other charges or payments due Seller have been
capitalized under the Mortgage or the related Mortgage Note;
(aa) The collection and servicing practices used by Seller with respect
to the Mortgage Note and Mortgage have been in all respects legal
and customary in the mortgage servicing business. All Escrow
Payments have been collected in full compliance with state and
federal law. An escrow of funds is not prohibited by applicable law
and has been established in an amount sufficient to pay for every
item which remains unpaid and which has been assessed but is not yet
due and payable. No escrow deposits or Escrow Payments or other
charges or payments due the Seller have been capitalized under the
Mortgage or the Mortgage Note. With respect to escrow deposits and
Escrow Payments, any interest required to be paid pursuant to state
and local law has been properly paid and credited;
(bb) The Mortgage Loan is covered by an ALTA or CLTA mortgage title
insurance policy, or such other generally acceptable form of policy
or insurance, issued by and the valid and binding obligation of a
title insurer and qualified to do business in the jurisdiction where
the Mortgaged Property is located, insuring Seller, its successors
and assigns, as to the first priority lien of the Mortgage in the
original principal amount of the Mortgage Loan and against any loss
by reason of the invalidity or unenforceability of the lien
resulting from the provisions of the Mortgage. Such mortgage title
insurance policy insures Seller, its successors and assigns as
mortgagee and the assignment to Purchaser of Seller's interest in
such mortgage title insurance policy does not require the consent of
or notification to the insurer, such mortgage title insurance policy
is in full force and effect and will be in full force and effect and
inure to the benefit of Purchaser upon the consummation of the
transactions contemplated by this Agreement. No claims have been
made under such mortgage title insurance policy and, to Seller's
knowledge, no prior holder of the related Mortgage, including
Seller, has done, by act or omission, anything which would impair
the coverage of such mortgage title insurance policy;
(cc) Principal payments on the Mortgage Loan commenced no more than sixty
(60) days after the proceeds of the Mortgage Loan were disbursed.
The Mortgage Loan bears interest at the Mortgage Interest Rate.
Except with respect to Mortgage Loans identified on the Mortgage
Loan Schedule as balloon payment Mortgage Loans, the Mortgage Note
is payable on the first day of each month in Monthly Payments which
will fully amortize the Stated Principal Balance of the Mortgage
Loan over its remaining term at the Mortgage Interest Rate. The
Mortgage Note does not permit negative amortization;
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(dd) The Mortgage has not been satisfied, canceled, subordinated or
rescinded, in whole or in part, and the Mortgaged Property has not
been released from the lien of the Mortgage, in whole or in part,
nor has any instrument been executed that would effect any such
release, cancellation, subordination or rescission. The Seller has
not waived the performance by the Mortgagor of any action, if the
Mortgagor's failure to perform such action would cause the Mortgage
Loan to be in default, nor has the Seller waived any default
resulting from any action or inaction by the Mortgagor;
(ee) At the time the Mortgage Loan was originated, the originator was a
mortgagee approved by the Secretary of Housing and Urban Development
pursuant to Sections 203 and 211 of the National Housing Act or a
savings and loan association, a savings bank, a commercial bank or
similar banking institution which is supervised and examined by a
Federal or State authority or a Xxxxxx Xxx or Xxxxxxx Mac approved
mortgagee;
(ff) The Mortgage Loan was underwritten in accordance with the Seller's
Underwriting Guidelines in effect at the time the Mortgage Loan was
originated;
(gg) As of the related Closing Date the Mortgaged Property is lawfully
occupied under applicable law. All inspections, licenses and
certificates required to be made or issued with respect to all
occupied portions of the Mortgaged Property and, with respect to the
use and occupancy of the same, including but not limited to
certificates of occupancy and fire underwriting certificates, have
been made or obtained from the appropriate authorities;
(hh) The Seller has no knowledge of any circumstances or conditions with
respect to the Mortgage, the Mortgaged Property, the Mortgagor or
the Mortgagor's credit standing that can reasonably be expected to
cause the Mortgage Loan to be an unacceptable investment, cause the
Mortgage Loan to become delinquent, or adversely affect the value of
the Mortgage Loan;
(ii) If the Mortgaged Property is a condominium unit or a planned unit
development (other than a de minimus planned unit development) such
condominium or planned unit development project meets Seller's
Underwriting Guidelines with respect to such condominium or planned
unit development;
(jj) The Assignment of Mortgage is in recordable form and is acceptable
for recording under the laws of the jurisdiction in which the
Mortgaged Property is located;
(kk) The Mortgage contains an enforceable provision for the acceleration
of the payment of the unpaid principal balance of the Mortgage Loan
in the event that the Mortgaged Property is sold or transferred
without the prior written consent of the Mortgagor thereunder;
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(ll) Unless as set forth in the Assignment and Conveyance, the Mortgage
Loan does not contain provisions pursuant to which Monthly Payments
are paid or partially paid with funds deposited in any separate
account established by the Seller, the Mortgagor or anyone on behalf
of the Mortgagor, or paid by any source other than the Mortgagor nor
does it contain any other similar provisions currently in effect
which may constitute a "buydown" provision. The Mortgage Loan is not
a graduated payment mortgage loan and the Mortgage Loan does not
have a shared appreciation or other contingent interest feature;
(mm) Except with respect to Loans which were originated using an
alternative valuation method that is acceptable to Xxxxxx Xxx and
Xxxxxxx Mac, the Servicing File contains an appraisal of the related
Mortgaged Property which satisfied the standards of Xxxxxx Xxx and
Xxxxxxx Mac and was made and signed, prior to the approval of the
Mortgage Loan application, by a qualified appraiser, duly appointed
by the Seller, who had no interest, direct or indirect in the
Mortgaged Property or in any loan made on the security thereof;
whose compensation is not affected by the approval or disapproval of
the Mortgage Loan and who met the minimum qualifications of Xxxxxx
Mae and Xxxxxxx Mac. Each appraisal of the Loan was made in
accordance with the relevant provisions of the Financial
Institutions Reform, Recovery, and Enforcement Act of 1989;
(nn) The Mortgagor has not notified the Seller, and the Seller has no
knowledge of any relief requested or allowed to the Mortgagor under
the Servicemembers' Civil Relief Act of 2003;
(oo) The Mortgaged Property is free from any and all toxic or hazardous
substances and there exists no violation of any local, state or
federal environmental law, rule or regulation. To the best of the
Seller's knowledge, there is no pending action or proceeding
directly involving any Mortgaged Property of which the Seller is
aware in which compliance with any environmental law, rule or
regulation is an issue; and to the best of the Seller's knowledge,
nothing further remains to be done to satisfy in full all
requirements of each such law, rule or regulation consisting a
prerequisite to use and enjoyment of said property;
(pp) No Mortgage Loan was made in connection with (i) the construction or
rehabilitation of a Mortgaged Property or (ii) facilitating the
trade-in or exchange of a Mortgaged Property;
(qq) The Mortgagor is a natural person or a trust that is in compliance
with Xxxxxx Mae guidelines for such trusts;
(rr) None of the Mortgage Loans are classified as (i) "high cost" loans
under the Home Ownership and Equity Protection Act of 1994 or (ii)
"high cost," "threshold," "predatory" or "covered" loans under any
other applicable state, federal or local law (or a similarly
classified loan using different terminology
25
under a law imposing heightened regulatory scrutiny or additional
legal liability for residential mortgage loans having high interest
rates, points and/or fees);
(ss) No Mortgage Loan is a "High Cost Home Loan" as defined in the
Georgia Fair Lending Act, as amended (the "Georgia Act"). No
Mortgage Loan which is a "home loan" subject to the Georgia Act and
secured by owner occupied real property or an owner occupied
manufactured home located in the State of Georgia was originated (or
modified) on or after October 1, 2002 through and including March 6,
2003;
(tt) None of the Mortgage Loans are simple interest Mortgage Loans;
(uu) No Mortgagor was required to purchase any credit life,
disability, accident or health insurance product as a condition of
obtaining the extension of credit. No proceeds from any Mortgage
Loan were used to purchase single premium credit insurance policies
as part of the origination of, or as a condition to closing, such
Mortgage Loan;
(vv) The Seller has obtained a life of loan, transferable real estate Tax
Service Contract on each Mortgage Loan except for a newly originated
Mortgage Loan on a Mortgaged Property in California;
(ww) With respect to each Mortgage Loan that has a prepayment penalty
feature, each such prepayment penalty is enforceable and will be
enforced by the Seller, and each prepayment is permitted pursuant to
federal, state and local law. No Mortgage Loan will impose a
prepayment penalty for a term in excess of five years from the date
such Mortgage Loan was originated;
(xx) Each original Mortgage was recorded and, except for those Mortgage
Loans subject to the MERS(R) system, all subsequent assignments of
the original Mortgage (other than the assignment to the Purchaser)
have been recorded in the appropriate jurisdictions wherein such
recordation is necessary to perfect the lien thereof as against
creditors of the Seller, or is in the process of being recorded;
(yy) The Seller has complied with all applicable anti-money laundering
laws and regulations, including without limitation the USA Patriot
Act of 2001 (collectively, the "Anti-Money Laundering Laws"); the
Seller has established an anti-money laundering compliance program
as required by the Anti-Money Laundering Laws, has conducted the
requisite due diligence in connection with the origination of each
Mortgage Loan for purposes of the Anti-Money Laundering Laws,
including with respect to the legitimacy of the applicable Mortgagor
and the origin of the assets used by the said Mortgagor to purchase
the property in question, and maintains, and will maintain,
sufficient information to identify the applicable Mortgagor for
purposes of the Anti-Money Laundering Laws;
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(zz) For each Mortgage Loan, the Seller or its designee has
accurately and fully furnished, in accordance with the Fair Credit
Reporting Act and its implementing regulations, accurate and
complete information 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;
(aaa) The Mortgage Loan is a "qualified mortgage" within the meaning
of Section 860G(a)(3)(A) of the Code;
(bbb) The methodology used in underwriting the extension of credit
for each Mortgage Loan employs objective mathematical principles
which relate to the Mortgagor's income, assets and liabilities to
the proposed payment and such underwriting methodology does not rely
on the extent of the Mortgagor's equity in the collateral as the
principal determining factor in approving such credit extension.
Such underwriting methodology confirmed that at the time of
origination (application/approval) the Mortgagor had a reasonable
ability to make timely payments on the Mortgage Loan;
(ccc) No Mortgagor was encouraged or required to select a Mortgage
Loan product offered by the Seller or, to the best of Seller's
knowledge, a third party originator which is a higher cost product
designed for less creditworthy borrowers, unless at the time of the
Mortgage Loan's origination, such Mortgagor did not qualify taking
into account credit history and debt to income ratios for a lower
cost credit product then offered by the Mortgage Loan's originator
or any affiliate of the Mortgage Loan's originator;
(ddd) With respect to any Mortgage Loan which is a Texas Home Equity
Loan, any and all requirements of Section 50, Article XVI of the
Texas Constitution applicable to Texas Home Equity Loans which were
in effect at the time of the origination of the Mortgage Loan have
been complied with. Specifically, without limiting the generality of
the foregoing, any fees paid in connection with such Mortgage Loan
in order for the Mortgagor to receive a reduced interest rate are
not required to be included in the calculation of the aggregate fees
pursuant to Section 50(a)(6)(E) of the Texas Constitution;
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(eee) No Mortgage Loan is a "High-Cost Home Loan" as defined in New
York Banking Law 6-1;
(fff) No Mortgage Loan is a "High-Cost Home Loan" as defined in the
Arkansas Home Loan Protection Act effective July 16, 2003 (Act 1340
of 2003);
(ggg) No Mortgage Loan is a "High-Cost Home Loan" as defined in the
Kentucky high-cost home loan statute effective June 24, 2003 (Ky.
Rev. Stat. Section 360.100);
(hhh) No Mortgage Loan is a "High-Cost Home Loan" as defined in the
New Jersey Home Ownership Act effective November 27, 2003 (N.J.S.A.
46:10B-22 et seq.);
(iii) No Mortgage Loan is a "High-Cost Home Loan" as defined in the
New Mexico Home Loan Protection Act effective January 1, 2004 (N.M.
Stat. Xxx. Sections. 58-21A-1 et seq.);
(jjj) No Mortgage Loan is a "High-Risk Home Loan" as defined in the
Illinois High-Risk Home Loan Act effective January 1, 2004 (815 Ill.
Comp. Stat. 137/1 et seq.);
(kkk) All points and fees related to each Mortgage Loan were
disclosed in writing to the borrower in accordance with applicable
state and federal law and regulation. Except in the case of a
Mortgage Loan in an original principal amount of less than $60,000
which would have resulted in an unprofitable origination, no
borrower was charged "points and fees" (whether or not financed) in
an amount greater than 5% of the principal amount of such loan, such
5% limitation is calculated in accordance with Xxxxxx Mae's
anti-predatory lending requirements as set forth in the Xxxxxx Xxx
Selling Guide;
(lll) The Mortgage Note, the Mortgage, the Assignment of Mortgage
and any other documents required to be delivered for the Mortgage
Loan by the Seller under this Agreement as set forth in Exhibit H
attached hereto have been delivered to the Custodian. The Seller is
in possession of a complete, true and accurate Mortgage File in
compliance with Exhibit A, except for such documents the originals
of which have been delivered to the Custodian; and
(mmm) The documents, instruments and agreements submitted for loan
underwriting were not falsified by the Seller or, by any other party
and contain no
28
untruestatement of material fact or omit to state a material fact
required to be stated therein or necessary to make the information
and statements therein not misleading. The Seller has reviewed all
of the documents constituting the Servicing File and has made such
inquiries as it deems necessary to make and confirm the accuracy of
the representations set forth herein. The term of this
representation shall expire five (5) years following the related
Closing Date.
Section 6.02 Representations and Warranties Regarding Seller.
Seller hereby represents and warrants to Purchaser as of the Closing Date:
(a) Seller is duly organized, validly existing and in good standing
under the laws of Delaware and is and will remain in compliance with
the laws of each state in which any Mortgaged Property is located to
the extent necessary to ensure the enforceability of each Mortgage
Loan and the servicing of the Mortgage Loan in accordance with the
terms of this Agreement. Seller has all licenses necessary to carry
on its business as now being conducted;
(b) Seller has 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 of transfer
to be delivered pursuant to this Agreement) by 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 Seller, subject to applicable law; and
all requisite corporate action has been taken by Seller to make this
Agreement valid and binding upon Seller in accordance with its
terms;
(c) No approval of the transactions contemplated by this Agreement from
any federal or state regulatory authority having jurisdiction over
Seller is required or, if required, such approval has been or will,
prior to the related Closing Date, be obtained;
(d) The consummation of the transactions contemplated by this Agreement
are in the ordinary course of business of Seller and will not result
in the breach of any term or provision of the charter or by-laws of
Seller or result in the breach of any term or provision of, or
conflict with or constitute a default under or result in the
acceleration of any obligation under, any agreement, indenture or
loan or credit agreement or other instrument to which Seller or its
property is subject, or result in the violation of any law, rule,
regulation, order, judgment or decree to which Seller or its
property is subject;
(e) The transfer, assignment and conveyance of the Mortgage Notes and
the Mortgage Loans by Seller pursuant to this Agreement are not
subject to the bulk transfer or any similar statutory provisions in
effect in any applicable jurisdiction;
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(f) There is no action, suit, proceeding or investigation pending or, to
the best knowledge of Seller, threatened against Seller which,
either individually or in the aggregate, would result in any
material adverse change in the business, operations, financial
condition, properties or assets of Seller, or in any material
impairment of the right or ability of Seller to carry on its
business substantially as now conducted 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 Seller contemplated herein, or which would materially impair the
ability of Seller to perform under the terms of this Agreement;
(g) Seller does not believe, nor does it have any reason or cause to
believe, that it cannot perform each and every covenant contained in
this Agreement. The Seller is solvent and the sale of the Mortgage
Loans is not undertaken to hinder, delay or defraud any of the
Seller's creditors;
(h) The Seller is an approved seller/servicer of conventional
residential mortgage loans for Xxxxxx Mae or Xxxxxxx Mac, with the
facilities, procedures, and experienced personnel necessary for the
sound servicing of mortgage loans of the same type as the Mortgage
Loans. The Seller is in good standing to sell mortgage loans to and
service mortgage loans for Xxxxxx Mae or Xxxxxxx Mac, and no event
has occurred, including but not limited to a change in insurance
coverage, which would make the Seller unable to comply with Xxxxxx
Mae or Xxxxxxx Mac eligibility requirements or which would require
notification to either Xxxxxx Mae or Xxxxxxx Mac;
(i) 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 sale 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;
(j) The Mortgage Loans were selected from among the fixed rate one- to
four-family mortgage loans in the Seller's portfolio at the related
Closing Date as to which the representations and warranties set
forth in Section 6.01 could be made and such selection was not made
in a manner so as to affect adversely the interests of the
Purchaser;
(k) 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;
(l) The Seller has determined that the disposition of the Mortgage Loans
pursuant to this Agreement will be afforded sale treatment for
accounting and tax purposes;
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(m) The Seller is a member of MERS in good standing, and will comply in
all material respects with the rules and procedures of MERS in
connection with the servicing of the MERS Mortgage Loans for as long
as such Mortgage Loans are registered with MERS;
(n) There has been no change in the business, operations, financial
condition, properties or assets of the Seller since the date of the
Seller's most recent financial statements that would have a material
adverse effect on its ability to perform its obligations under this
Agreement;
(o) The Seller has not dealt with any broker, investment banker, agent
or other person that may be entitled to any commission or
compensation in connection with the sale of the Mortgage Loans;
(p) The Seller's decision to originate any mortgage loan or to deny any
mortgage loan application is an independent decision based upon
Seller's Underwriting Guidelines, and is in no way made as a result
of Purchaser's decision to purchase, or not to purchase, or the
price Purchaser may offer to pay for, any such mortgage loan, if
originated; and
(q) The Seller acknowledges and agrees that the Servicing Fee, as
calculated at the Servicing Fee Rate, represents reasonable
compensation for performing such services and that the entire
Servicing Fee shall be treated by the Seller, for accounting and tax
purposes, as compensation for the servicing and administration of
the Mortgage Loans pursuant to this Agreement.
Section 6.03 Remedies for Breach of Representations and Warranties.
It is understood and agreed that the representations and warranties set
forth in Sections 6.01 and 6.02 shall survive delivery of the Mortgage Loans to
Purchaser and shall inure to the benefit of Purchaser, notwithstanding any
restrictive or qualified endorsement on any Mortgage Note or Assignment of
Mortgage or the examination of any Mortgage File.
Upon discovery by either Seller or Purchaser of a breach of any of the
foregoing representations and warranties which materially and adversely affects
the value of the Mortgage Loans or the interest of Purchaser (or which
materially and adversely affects the interest of Purchaser in the related
Mortgage Loan in the case of a representation and warranty relating to a
particular Mortgage Loan), the party discovering such breach shall give prompt
written notice to the others. Purchaser agrees to give written notice of any
such breach, outlining with specificity the section of this Agreement which
Purchaser claims has been violated. Within sixty (60) days of the earlier of
either discovery by it or notice to it of any such breach, Seller shall use its
best efforts to promptly cure such breach in all material respects and, if such
breach cannot be cured during such sixty (60) day period, Seller shall, at
Purchaser's option and not later than 120 days after its discovery or receipt of
notice of such breach, repurchase such Mortgage Loan at the Repurchase Price. In
the event of a breach of the representation and warranty set forth in Section
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6.01(jj), the Seller will cure (by providing an original Assignment of Mortgage
in blank, with original signatures) within three (3) business days of Seller's
receipt of notification of such breach or will promptly repurchase such Mortgage
Loan at the Repurchase Price.
In the event that any such breach shall involve any representation or
warranty set forth in Section 6.02, and such breach cannot be cured within sixty
(60) days of the earlier of either discovery by or notice to Seller of such
breach, all the Mortgage Loans shall, at Purchaser's option, be repurchased by
Seller at the Repurchase Price. However, if the breach shall involve a
representation or warranty set forth in Section 6.01 and the Seller discovers or
receives notice of such breach within 120 days of the related Closing Date, the
Seller may, at its option and assuming that Seller has a Qualified Substitute
Mortgage Loan, rather than repurchase any Mortgage Loan as provided above,
remove such Mortgage Loan and substitute in its place a Qualified Substitute
Mortgage Loan or Loans, provided, however, that any such substitution shall be
effected not later than 120 days after the related Closing Date. If Seller has
no Qualified Substitute Mortgage Loan, it shall repurchase the deficient
Mortgage Loan. Any repurchase of a Mortgage Loan or Loans pursuant to the
foregoing provisions of this Section 6.03 shall be accomplished by deposit in
the Custodial Account of the amount of the Repurchase Price (after deducting
therefrom any amounts received in respect of such repurchased Mortgage Loan or
Loans and being held in the Custodial Account for future distribution).
As to any Deleted Mortgage Loan for which Seller substitutes a Qualified
Substitute Mortgage Loan or Loans, Seller shall effect such substitution by
delivering to Purchaser for such Qualified Substitute Mortgage Loan or Loans the
Mortgage Note, the Mortgage, the Assignment of Mortgage and such other documents
and agreements as are required by Section 5.03, with the Mortgage Note endorsed
as required by Section 5.03. Seller shall deposit in the Custodial Account the
Monthly Payment less the Servicing Fee due on such Qualified Substitute Mortgage
Loan or Loans in the month following the date of such substitution. Monthly
Payments due with respect to Qualified Substitute Mortgage Loans in the month of
substitution will be retained by Seller. For the month of substitution,
distributions to Purchaser will include the Monthly Payment due on such Deleted
Mortgage Loan in the month of substitution, and Seller shall thereafter be
entitled to retain all amounts subsequently received by Seller in respect of
such Deleted Mortgage Loan. Seller shall give written notice to Purchaser that
such substitution has taken place and shall amend the Mortgage Loan Schedule to
reflect the removal of such Deleted Mortgage Loan from the terms of this
Agreement and the substitution of the Qualified Substitute Mortgage Loan. Upon
such substitution, such Qualified Substitute Mortgage Loan or Loans shall be
subject to the terms of this Agreement in all respects, and Seller shall be
deemed to have made with respect to such Qualified Substitute Mortgage Loan or
Loans, as of the date of substitution, the covenants, representations and
warranties set forth in Sections 6.01 and 6.02.
For any month in which Seller substitutes one or more Qualified Substitute
Mortgage Loans for one or more Deleted Mortgage Loans, Seller will determine the
amount (if any) by which the aggregate principal balance of all such Qualified
Substitute Mortgage Loans as of the date of substitution is less than the
aggregate Stated Principal Balance of all such Deleted Mortgage Loans (after
application of scheduled principal payments due in the month of substitution).
The amount of such shortfall shall be distributed by Seller in the month of
substitution pursuant to Section 11.01. Accordingly, on the date of such
substitution, Seller will
32
deposit from its own funds into the Custodial Account an amount equal to the
amount of such shortfall.
In addition to such cure, repurchase and substitution obligation, Seller
shall indemnify Purchaser and hold it harmless against any losses, damages,
penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments, and other costs and expenses resulting from any claim, demand,
defense or assertion based on or grounded upon, or resulting from, a breach of
Seller's representations and warranties contained in this Article VI. It is
understood and agreed that the obligations of Seller set forth in this Section
6.03 to cure or repurchase a defective Mortgage Loan and to indemnify Purchaser
as provided in this Section 6.03 constitute the sole remedies of Purchaser
respecting a breach of the foregoing representations and warranties. The
provisions of this Section 6.03 shall survive termination of this Agreement.
Within five (5) Business Days of the repurchase of a Mortgage Loan or
substitution of a Qualified Substitute Mortgage Loan for a Deleted Mortgage Loan
by Seller, Purchaser agrees to return, such repurchased or Deleted Mortgaged
Loan to Seller, together with the related Mortgage File and all the documents
included therein.
Section 6.04 First Payment Default
With respect to any Mortgage Loan, if the related Mortgagor fails to make
the first Monthly Payment due to the Purchaser after the related Closing Date
within 30 days of the related Due Date, the Seller shall, upon receipt of notice
from the Purchaser, promptly repurchase such Mortgage Loan (a "First Payment
Default Mortgage Loan") from the Purchaser. For example, a Mortgage Loan whose
first monthly payment due the Purchaser is February 1, 2004 but such monthly
payment is not received until after February 29, 2004, such Mortgage Loan is a
First Payment Default Mortgage Loan and a Mortgage Loan whose first Monthly
Payment due the Purchaser is March 1, 2004, such Mortgage Loan becomes a First
Payment Default Mortgage Loan when the monthly payment is received after March
31, 2004.
Section 6.05 Review of Mortgage Loans.
For the time period set forth in the related Purchase Price and
Terms Letter, the Purchaser shall have the right to review the Mortgage Files
and obtain BPOs and other property evaluations on the Mortgaged Properties
relating to the Mortgage Loans purchased on the related Closing Date, with the
results of such BPO or property evaluation reviews to be communicated to the
Seller. The Purchaser shall have the right to reject any Mortgage Loan which in
the Purchaser's sole determination (i) fails to conform to the Underwriting
Guidelines, or (ii) value of the Mortgaged Property pursuant to the property
evaluation obtained by the Purchaser is 85% or less than the value as indicated
on the appraisal or (iii) the Mortgage Loan is underwritten without verification
of the Borrower's income and assets and there is no credit report and credit
score (except Mortgage Loans underwritten by an automated underwriting system)
or (iv) the Purchaser deems the Mortgage Loan not to be an acceptable credit
risk. Prior to the related Closing Date, with respect to any Mortgage Loan that
the Purchaser feels should be rejected from this Purchase Transaction in
accordance with this Section, the Purchaser agrees to review any rebuttals
presented by the Seller. The Seller shall make available all files required by
Purchaser in order to complete its review, including capturing all CRA/HMDA
required data
33
fields and any additional fields as may be required at the
Purchaser's expense. Any review performed by the Purchaser prior to the related
Closing Date does not limit the Purchaser's rights or the Seller's obligations
under this Section or under the Agreement.
ARTICLE VII
CLOSING
Section 7.01 Closing.
The closing for the purchase and sale of the Mortgage Loans shall take
place on the related Closing Date. The closing shall, at Purchaser's option, be
either by telephone, confirmed by letter or wire as the parties shall agree or
conducted in person, at such place as the parties shall agree.
The closing shall be subject to each of the following conditions:
(a) All of the representations and warranties of Seller under this
Agreement shall be true and correct as of the Closing Date and no
event shall have occurred which, with notice or the passage of time,
or both, would constitute a default under this Agreement;
(b) Purchaser and Seller shall have received, or Seller's attorneys
shall have received in escrow, all Closing Documents as specified in
Section 8.01 of this Agreement, in such forms as are agreed upon and
acceptable to Purchaser and Seller, duly executed by all signatories
as required pursuant to the respective terms thereof;
(c) Seller shall have delivered and released to Purchaser or its
designee all documents required to be so delivered hereunder; and
(d) All other terms and conditions of this Agreement shall have been
complied with.
Subject to the foregoing conditions, Purchaser shall pay to Seller on the
Closing Date the Purchase Price, plus accrued interest pursuant to Section 4.01
of this Agreement, by wire transfer of immediately available funds to the
account designated by Seller.
ARTICLE VIII
CLOSING DOCUMENTS
Section 8.01. Closing Documents.
The Closing Documents for the Initial Closing shall consist of the
following:
34
(a) an executed copy of this Agreement,including all exhibits, in two
(2) counterparts;
(b) a Custodial Account Certification or Custodial Account Letter
Agreement, as required under the Agreement;
(c) an Escrow Account Certification or Escrow Account Letter Agreement,
as required under the Agreement;
(d) an REO Account Certification or REO Account Letter Agreement, as
required under the Agreement; and
(e) an Officer's Certificate in the form of Exhibit I hereto, including
all attachments, thereto;
The Closing Documents for the Initial Closing as well as all other
Closings:
(a) Assignment and Conveyance Agreement by and between Seller and
Purchaser dated as of the related Closing Date;
(b) the Initial Certification of the Custodian regarding the
Mortgage Loans in the related Mortgage Loan Package;
(c) a Security Release Certification, if applicable, executed by any
other Person, as requested by Purchaser, if any of the Mortgage
Loans have at any time been subject to a security interest,
pledge or hypothecation for the benefit of such person;
(d) an Assignment and Assumption by Purchaser to Seller of the
Purchaser's rights as Servicer under the Custodial Agreement by
and between Purchaser and Custodian dated as of September 1,
1999, with respect to the Mortgage Loans in the related Mortgage
Loan Package;
(e) The Mortgage Loan Schedule, one copy to be attached hereto; and
(f) the related Purchase Price and Terms Letter.
ARTICLE IX
COSTS
Section 9.01 Costs.
Each party shall bear its own costs and expenses. Purchaser will pay any
commissions due its salesmen, the legal fees and expenses of its attorneys and
all expenses relating to any review of the Mortgage Loans performed by
Purchaser. All other costs and expenses incurred in
35
connection with the transfer and delivery of the Mortgage Loans, including
recording fees and Seller's attorneys' fees, shall be paid by Seller.
ARTICLE X
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 10.01 Seller to Act as Servicer.
Seller shall service and administer the Mortgage Loans in accordance with
this Agreement and Customary Servicing Procedures and shall have full power and
authority, acting alone or through Subservicers as provided in Section 10.02, to
do or cause to be done any and all things in connection with such servicing and
administration which Seller may deem necessary or desirable and consistent with
the terms of this Agreement. Seller may perform its servicing responsibilities
through agents or independent contractors, but shall not thereby be released
from any of its responsibilities hereunder, and Seller shall diligently pursue
all of its rights against such agents or independent contractors.
Consistent with the terms of this Agreement, 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; provided, however, that Seller shall not permit any modification with
respect to any Mortgage Loan that would change the Mortgage Interest Rate or the
Monthly Payment amount, defer or forgive the payment of any principal or
interest, change the final maturity date, change the outstanding principal
amount (except for actual payments of principal), make any future advances or
extend the final maturity date on such Mortgage Loan. Without limiting the
generality of the foregoing, Seller in its own name or in the name of a
Subservicer is hereby authorized and empowered by Purchaser when Seller believes
it appropriate and reasonable in its best judgment, to execute and deliver, on
behalf of itself and 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 the Mortgaged Properties and to institute
foreclosure proceedings or obtain a deed-in-lieu of foreclosure so as to convert
the ownership of such properties, and to hold or cause to be held title to such
properties, on behalf of Purchaser pursuant to the provisions of Section 10.17.
Seller shall make all required Servicing Advances and shall service and
administer the Mortgage Loans in accordance with applicable state and federal
law and shall provide to the Mortgagors any reports required to be provided to
them thereby. Purchaser shall furnish to Seller and any Subservicer any powers
of attorney and other documents reasonably necessary or appropriate to enable
Seller and any Subservicer to carry out their servicing and administrative
duties under this Agreement.
Section 10.02 Subservicing Agreements Between Seller and Subservicers.
Seller may enter into Subservicing Agreements with Subservicers provided
any Subservicer is a Xxxxxx Xxx approved lender or Xxxxxxx Mac seller/servicer
in good standing for the servicing and administration of the Mortgage Loans.
Each Subservicing Agreement must
36
impose on the Subservicer requirements conforming to the provisions set forth in
Section 10.06. Subject to Section 16.01, Seller and the Subservicers may make
amendments to the Subservicing Agreements or enter into different forms of
Subservicing Agreements; provided, however, that any such amendments or
different forms shall be consistent with and not violate the provisions of this
Agreement, and that no such amendment or different form shall be made or entered
into which could be reasonably expected to be materially adverse to the
interests of Purchaser, without the consent of Purchaser. Any variation from the
provisions set forth in Section 10.06 relating to insurance or priority
requirements of Subservicing Accounts, or credits and charges to the
Subservicing Accounts or the timing and amount of remittances by the
Subservicers to Seller, are conclusively deemed to be inconsistent with this
Agreement and therefore prohibited.
As part of its servicing activities hereunder, Seller, for the benefit of
Purchaser, shall enforce the obligations of each Subservicer under the related
Subservicing Agreement, including, without limitation, any obligation to make
advances in respect of delinquent payments as required by a Subservicing
Agreement. Such enforcement, including, without limitation, the legal
prosecution of claims, termination of Subservicing Agreements and the pursuit of
other appropriate remedies, shall be in such form and carried out to such an
extent and at such time as Seller, in its good faith business judgment, would
require were it the owner of the related Mortgage Loans. Seller shall pay the
costs of such enforcement at its own expense, but shall be reimbursed therefor
only (i) from a general recovery resulting from such enforcement only to the
extent, if any, that such recovery exceeds all amounts due hereunder in respect
of the related Mortgage Loans or (ii) from a specific recovery of costs,
expenses or attorneys' fees against the party against whom such enforcement is
directed.
At the cost and expense of the Seller, without any right of reimbursement
from the Custodial Account, the Seller shall be entitled to terminate the rights
and responsibilities of the Subservicer and arrange for any servicing
responsibilities to be performed by a successor Subservicer meeting the
requirements in the first paragraph; provided, however, that nothing contained
herein shall be deemed to prevent or prohibit the Seller, at the Seller's
option, from electing to service the related Mortgage Loans itself. In the event
that the Seller's responsibilities and duties under this Agreement are
terminated pursuant to Section 13.04, 14.01 or 15.02, and if requested to do so
by the Purchaser, the Seller shall at its own cost and expense terminate the
rights and responsibilities of the Subservicer as soon as is reasonably
possible. The Seller shall pay all fees, expenses or penalties necessary in
order to terminate the rights and responsibilities of the Subservicer from the
Seller's own funds without reimbursement from the Purchaser.
Section 10.03 Successor Subservicers.
Seller shall be entitled to terminate any Subservicing Agreement and the
rights and obligations of any Subservicer pursuant to any Subservicing Agreement
in accordance with the terms and conditions of such Subservicing Agreement. In
the event of termination of any Subservicer, all servicing obligations of such
Subservicer shall be assumed simultaneously by Seller without any act or deed on
the part of such Subservicer or Seller, and Seller either shall service directly
the related Mortgage Loans or shall enter into a Subservicing Agreement with a
successor Subservicer which qualifies under Section 10.02. If Seller enters into
a Subservicing
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Agreement with a successor Subservicer, Seller shall use reasonable efforts to
have the successor Subservicer assume liability for the representations and
warranties made by the terminated Subservicer in respect of the related Mortgage
Loans, and in the event of any such assumption by the successor Subservicer,
Seller may, in the exercise of its business judgment, release the terminated
Subservicer from liability for such representations and warranties.
Section 10.04 Liability of Seller.
Notwithstanding any Subservicing Agreement, any of the provisions of this
Agreement relating to agreements or arrangements between Seller and a
Subservicer or reference to actions taken through a Subservicer or otherwise,
Seller shall remain obligated and liable to Purchaser for the servicing and
administering of the Mortgage Loans in accordance with the provisions of Section
10.01 without diminution of such obligation or liability by virtue of such
Subservicing Agreements or arrangements or by virtue of indemnification from the
Subservicer for any acts and omissions and to the same extent and under the same
terms and conditions as if Seller alone were servicing and administering the
Mortgage Loans and any other transactions or services relating to the Mortgage
Loans involving the Subservicer shall be deemed to be between the Subservicer
and Seller alone and Purchaser shall have no obligations, duties or liabilities
with respect to the Subservicer including no obligation, duty or liability of
Purchaser to pay Subservicer's fees and expenses except pursuant to an
assumption of Seller's obligations pursuant to Section 16.01. For purposes of
this Agreement, Seller shall be deemed to have received payments on Mortgage
Loans when the Subservicer has received such payments. Seller shall be entitled
to enter into any agreement with a Subservicer for indemnification of Seller by
such Subservicer and nothing contained in this Agreement shall be deemed to
limit or modify such indemnification. Seller shall pay all fees and expenses of
the Subservicer from its own funds, the Servicing Fee or other amounts permitted
to be retained by or reimbursed to Seller hereunder.
Section 10.05 No Contractual Relationship Between Subservicers and
Purchaser.
Any Subservicing Agreement that may be entered into and any transactions
or services relating to the Mortgage Loans involving a Subservicer in its
capacity as such and not as Seller shall be deemed to be between the Subservicer
and Seller alone, and Purchaser shall not be deemed a party thereto and shall
have no claims, rights, obligations, duties or liabilities with respect to the
Subservicer except as set forth in Section 16.01.
Section 10.06 Subservicing Accounts.
In those cases where a Subservicer is servicing a Mortgage Loan pursuant
to a Subservicing Agreement, the Subservicer will be required to establish and
maintain one or more accounts (collectively, the "Subservicing Account"). The
Subservicing Account shall be insured by the FDIC to the limits established by
such corporation, and shall be segregated on the books of the Subservicer and
relate only to the Mortgage Loans subject to this Agreement and other mortgage
loans owned or serviced by Seller. All funds deposited in the Subservicing
Account shall be held for the benefit of Seller. The Subservicer shall deposit
in the Subservicing Account on a daily basis all amounts of the type described
in clauses (a) through (f) of Section 10.09, received by the Subservicer with
respect to the Mortgage Loans. On the date set forth in the
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related Subservicing Agreement (the "Subservicer Remittance Date"), the
Subservicer will be required to remit all such amounts to Seller, except, if
applicable, any Monthly Payment received which constitutes a late recovery with
respect to which a Subservicer Advance (as defined below) was previously made;
and, if the Subservicing Agreement so provides, the Subservicer will also be
required to remit, with respect to each Mortgage Loan for which the Monthly
Payment due on the immediately preceding Due Date was delinquent as of the
Subservicer Remittance Date, an amount equal to such Monthly Payment net of the
related Subservicing Fee (a "Subservicer Advance"). The Subservicer may deduct
from each remittance, as provided above, an amount equal to Subservicing Fees to
which it is then entitled to the extent not previously paid to or retained by
it. Seller is not obligated to require in a Subservicing Agreement that any
Subservicer make Subservicer Advances as described above.
Section 10.07 Liquidation of Mortgage Loans.
In the event that any payment due under any Mortgage Loan 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, Seller shall take such action as
(1) the Seller would take under similar circumstances with respect to a similar
mortgage loan held for its own account for investment, (2) shall be consistent
with Customary Servicing Procedures, (3) the Seller shall determine prudently to
be in the best interest of Purchaser and (4) is consistent with any related PMI
Policy. In the event that any payment due under any Mortgage Loan remains
delinquent for a period of ninety (90) days or more, Seller shall commence
foreclosure proceedings, provided that, prior to commencing foreclosure
proceedings, the Seller shall notify the Purchaser or its designee in writing of
the Seller's intention to do so, in accordance with its customary and usual
foreclosure procedures. In such connection, Seller shall from its own funds make
all necessary and proper Servicing Advances through final disposition but only
to the extent that Seller shall determine, in its good faith judgment, that the
amount of a proposed Servicing Advance is recoverable. Seller shall be
reimbursed for all Servicing Advances in accordance with this Agreement.
Notwithstanding anything to the contrary contained herein, in connection
with a foreclosure or acceptance of a deed in lieu of foreclosure, in the event
the Seller has reasonable cause to believe that a Mortgaged Property is
contaminated by hazardous or toxic substances or wastes, or if the Purchaser
otherwise requests an environmental inspection or review of such Mortgaged
Property, such an inspection or review is to be conducted by a qualified
inspector. The cost for such inspection or review shall be borne by the
Purchaser. Upon completion of the inspection or review, the Seller shall
promptly provide the Purchaser with a written report of the environmental
inspection.
After reviewing the environmental inspection report, the Purchaser shall
determine how the Seller shall proceed with respect to the Mortgaged Property.
In the event (a) the environmental inspection report indicates that the
Mortgaged Property is contaminated by hazardous or toxic substances or wastes
and (b) the Purchaser directs the Seller to proceed with foreclosure or
acceptance of a deed in lieu of foreclosure, the Seller shall be reimbursed for
all reasonable costs associated with such foreclosure or acceptance of a deed in
lieu of foreclosure and any related environmental clean up costs, as applicable,
from the related Liquidation
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Proceeds, or if the Liquidation Proceeds are insufficient to fully reimburse the
Seller, the Seller shall be entitled to be reimbursed from amounts in the
Custodial Account pursuant to Section 10.08 hereof. In the event the Purchaser
directs the Seller not to proceed with foreclosure or acceptance of a deed in
lieu of foreclosure, the Seller shall be reimbursed for all Servicing Advances
made with respect to the related Mortgaged Property from the Custodial Account
pursuant to Section 10.08 hereof.
Section 10.08 Collection of Mortgage Loan Payments.
Continuously from the date hereof until the principal and interest on all
Mortgage Loans are paid in full, Seller will proceed diligently, in accordance
with this Agreement, to collect all payments due under each of the Mortgage
Loans when the same shall become due and payable. Further, Seller will take
special care in ascertaining and estimating annual ground rents, taxes,
assessments, water rates, fire and hazard insurance premiums, PMI premiums, and
all other charges that, as provided in any Mortgage, will become due and payable
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.
Section 10.09 Establishment of Custodial Account; Deposits in Custodial
Account.
Seller shall segregate and hold all funds collected and received pursuant
to each Mortgage Loan separate and apart from any of its own funds and general
assets and shall establish and maintain one or more Custodial Accounts
(collectively, the "Custodial Account"), in the form of time deposit or demand
accounts, which may be interest bearing, titled "[name of Seller] in trust for
Purchaser and various Mortgagors - Fixed Rate Mortgage Loans". Such Custodial
Account shall be established with Citibank or, at the option of Seller and with
the prior consent of Purchaser, a Qualified Depository. In each case, the
Custodial Account shall be insured by the FDIC in a manner which shall provide
maximum available insurance thereunder and which may be drawn on by Seller The
creation of any Custodial Account shall be evidenced by (a) a certification in
the form of Exhibit B hereto, in the case of an account established with
Citibank, or (b) a letter agreement in the form of Exhibit C hereto, in the case
of an account held by a depository other than Citibank. The Custodial Account
will be established on the Closing Date and funds for the Mortgage Loans will be
segregated accordingly into such account. In either case, a copy of such
certification or letter agreement shall be furnished to Purchaser within five
(5) Business days after the Closing Date and a copy to any subsequent purchaser
upon request.
Seller shall deposit in the Custodial Account on a daily basis, or as and
when received from the Subservicer, and retain therein the following payments
and collections received or made by it subsequent to the related Cut-off Date
(other than in respect of principal and interest on the Mortgage Loans due on or
before the related Cut-off Date):
(a) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;
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(b) all payments on account of interest on the Mortgage Loans adjusted
to the Mortgage Loan Remittance Rate;
(c) all Liquidation Proceeds;
(d) all Insurance Proceeds received by Seller under any title, hazard,
private mortgage guaranty or other insurance policy 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 Customary Servicing Procedures;
(e) all awards or settlements in respect of condemnation proceedings or
eminent domain affecting any Mortgaged Property which are not
released to the Mortgagor in accordance with Customary Servicing
Procedures;
(f) any amount required to be deposited in the Custodial Account
pursuant to Sections 11.01, 11.03 and 12.02;
(g) any amounts payable in connection with the repurchase of any
Mortgage Loan pursuant to Section 6.03 or 6.04, and all amounts
required to be deposited by Seller in connection with shortfalls in
principal amount of Qualified Substitute Mortgage Loans pursuant to
Section 6.03; and
(h) with respect to each full or partial Principal Prepayment any
amounts to the extent that collections of interest at the Mortgage
Loan Remittance Rate are less than one (1) full month's interest at
the applicable Mortgage Loan Remittance Rate ("Prepayment Interest
Shortfalls"), such Prepayment Interest Shortfalls will be deposited
by Seller to the extent of its aggregate Servicing Fee received with
respect to the related Due Period.
The foregoing requirements for deposit in 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 need not be deposited by Seller in the Custodial Account. Any interest or
earnings on funds deposited in the Custodial Account by the depository
institution shall accrue to the benefit of Seller and Seller shall be entitled
to retain and withdraw such interest from the Custodial Account.
Section 10.10 Withdrawals From the Custodial Account.
Seller shall, from time to time, withdraw funds from the Custodial Account
for the following purposes:
(a) to make payments to Purchaser in the amounts and in the manner
provided for in Section 11.01;
(b) to temporarily reimburse itself for advances of Seller funds made
pursuant to Section 11.03, Seller's right to permanently reimburse
itself pursuant to this
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subclause (b) being limited to amounts received on the related
Mortgage Loan which represent payments of principal and/or interest
respecting which any such advance was made;
(c) to reimburse itself first for all unreimbursed Servicing Advances,
second for unreimbursed advances of Seller funds made pursuant to
Section 11.03, and third for any unpaid Servicing Fees, Seller's
right to reimburse itself pursuant to this subclause (c) with
respect to any Mortgage Loan being limited to related Liquidation
Proceeds, Insurance Proceeds, Condemnation Proceeds, amounts
representing proceeds of insurance policies covering the related
Mortgaged Property and such other amounts as may be collected by
Seller from the Mortgagor or otherwise relating to the Mortgage
Loan, it being understood that, in the case of any such
reimbursement, Seller's right thereto shall be prior to the rights
of Purchaser unless Seller is required to repurchase a Mortgage Loan
pursuant to Section 6.03, in which case Seller's right to such
reimbursement shall be subsequent to the payment to Purchaser of the
repurchase price pursuant to Section 6.03 and all other amounts
required to be paid to Purchaser with respect to such Mortgage Loan;
(d) to reimburse itself for all unreimbursed Servicing Advances,
advances of Seller funds made pursuant to Section 11.03 and unpaid
Servicing Fees to the extent that such amounts are nonrecoverable by
Seller pursuant to subclause (c) above, provided that the Mortgage
Loan for which such advances were made is not required to be
repurchased by Seller pursuant to Section 6.03, and to reimburse
itself for such amounts to the extent that such amounts are not
recovered from the disposition of REO Property pursuant to Section
10.17 hereof;
(e) to reimburse itself for subsequent trailing bills related to a
previously disposed of REO Property in which distribution of the net
cash proceeds has occurred;
(f) to reimburse itself for expenses incurred by and reimbursable to it
pursuant to Section 13.01;
(g) to pay to itself any interest earned on funds deposited in the
Custodial Account, such withdrawal to be made monthly not later than
the Remittance Date;
(h) to withdraw any amounts inadvertently deposited in the Custodial
Account;
(i) to clear and terminate the Custodial Account upon the termination of
this Agreement;
(j) to withdraw Service Fees to the extent deposited therein; and
(k) except with respect to any Mortgage Loan in breach of the
representation set forth in Section 6.01 (nn), to reimburse itself
for payments remitted or advances made for which there has been a
reduction in the amount of interest collectible for such
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related Prepayment Period as a result of the Servicemembers' Civil
Relief Act of 2003.
On each Remittance Date, Seller shall withdraw all funds from the
Custodial Account except for those amounts which, pursuant to Section 11.01(c)
and (d), Seller is not obligated to remit on such Remittance Date. Seller may
use such withdrawn funds only for the purposes described in this Section 10.10.
Section 10.11 Establishment of Escrow Account; Deposits in Escrow Account.
Seller shall segregate and hold or cause any Subservicer to segregate and
hold all funds collected and received pursuant to each Mortgage Loan which
constitute Escrow Payments separate and apart from any of its own funds and
general assets and shall establish and maintain one or more Escrow Accounts
(collectively, the "Escrow Account"), in the form of time deposit or demand
accounts, which may be interest bearing. The Escrow Account shall be established
with Citibank or, at the option of Seller and with the prior written consent of
Purchaser, Qualified Depository In each case, the Escrow Account shall be
insured by the FDIC in a manner which shall provide maximum available insurance
thereunder and which may be drawn on by Seller. The creation of any Escrow
Account shall be evidenced by (a) a certification in the form of Exhibit D
hereto, in the case of an account established with Citibank, or (b) a letter
agreement in the form of Exhibit E hereto, in the case of an account held by a
depository other than Citibank. The Escrow Account will be established on the
Closing Date and funds for the Mortgage Loans will be segregated accordingly
into such account. In either case, a copy of such certification or letter
agreement shall be furnished to Purchaser within five (5) Business days after
the Closing Date and a copy to any subsequent purchaser upon request.
Seller or the Subservicer shall deposit in the Escrow Account on a daily
basis, and retain therein: (a) 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 (b) all amounts representing
Insurance Proceeds or Condemnation Proceeds of any hazard insurance policy which
are to be applied to the restoration or repair of any Mortgaged Property. Seller
shall make withdrawals therefrom only in accordance with Section 10.12 hereof.
As part of its servicing duties, Seller or the Subservicer shall pay to the
Mortgagors interest on funds in the Escrow Account, to the extent required by
law.
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Section 10.12 Withdrawals From Escrow Account.
Withdrawals from the Escrow Account shall be made by Seller or the
Subservicer only (a) to effect timely payments of ground rents, taxes,
assessments, water rates, PMI premiums, fire and hazard insurance premiums or
other items constituting Escrow Payments for the related Mortgage, (b) to
reimburse Seller for any Servicing Advance made by Seller pursuant to Section
10.13 hereof with respect to a related Mortgage Loan, but only from amounts
received on the related Mortgage Loan which represent late payments or
collections of Escrow Payments thereunder, (c) to refund to any Mortgagor any
funds found to be in excess of the amounts required under the terms of the
related Mortgage Loan, (d) for transfer to the Custodial Account upon default of
a Mortgagor or in accordance with the terms of the related Mortgage Loan and if
permitted by applicable law, (e) for application to restore or repair of the
Mortgaged Property, (f) to pay to the Mortgagor, to the extent required by law,
any interest paid on the funds deposited in the Escrow Account, (g) to pay to
itself any interest earned on funds deposited in the Escrow Account (and not
required to be paid to the Mortgagor), such withdrawal to be made monthly not
later than the Remittance Date or (h) to clear and terminate the Escrow Account
upon the termination of this Agreement.
Section 10.13 Payment of Taxes, Insurance and Other Charges.
With respect to each Mortgage Loan, Seller or the Subservicer shall
maintain accurate records reflecting the status of ground rents, taxes,
assessments, water rates, sewer rates and other charges which are or may become
a lien upon the Mortgaged Property and the status of private mortgage guaranty
insurance premiums and 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 and at a time appropriate for securing maximum discounts
allowable, employing for such purpose deposits of the Mortgagor in the Escrow
Account which shall have been estimated and accumulated by Seller in amounts
sufficient for such purposes, as allowed under the terms of the Mortgage or
applicable law. To the extent that a Mortgage does not provide for Escrow
Payments, Seller shall determine that any such payments are made by the
Mortgagor at the time they first become due. Seller assumes full responsibility
for the timely payment of all such bills and shall effect timely payments of all
such bills irrespective of each Mortgagor's faithful performance in the payment
of same or the making of the Escrow Payments and shall make advances from its
own funds to effect such payments.
Section 10.14 Transfer of Accounts.
Seller may transfer the Custodial Account or the Escrow Account to a
different depository institution. Upon any such transfer, the Seller shall
promptly notify the Purchaser and deliver to the Purchaser a Custodial Account
Certification or Escrow Account Certification (as applicable) in the form of
Exhibit B or Exhibit D to this Agreement. 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.
Section 10.15 Maintenance of Hazard Insurance.
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Seller shall cause to be maintained for each Mortgage Loan fire and hazard
insurance with extended coverage customary in the area where the Mortgaged
Property is located, in an amount which is at least equal to the lesser of (a)
the full insurable value of the Mortgaged Property or (b) the greater of (i) the
outstanding principal balance owing on the Mortgage Loan and (ii) an amount such
that the proceeds of such insurance shall be sufficient to avoid the application
to the Mortgagor or loss payee of any coinsurance clause under the policy. If
the Mortgaged Property is 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) Seller will cause to be maintained a
flood insurance policy meeting the requirements of the current guidelines of the
Federal Insurance Administration with a generally acceptable insurance carrier,
in an amount representing coverage not less than the least of (a) the
outstanding principal balance of the Mortgage Loan, (b) the full insurable value
of the Mortgaged Property, or (c) the maximum amount of insurance available
under the Flood Disaster Protection Act of 1973, each as amended. Seller shall
also maintain on property acquired upon foreclosure, or by deed in lieu of
foreclosure, of any Mortgage Loan, 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, each as amended, flood insurance in an amount required above. Any amounts
collected by Seller under any such policies (other than amounts to be deposited
in the Escrow Account and applied to the restoration or repair of the Mortgaged
Property or property acquired in liquidation of the Mortgage Loan, or to be
released to the Mortgagor in accordance with Customary Servicing Procedures)
shall be deposited in the Custodial Account, subject to withdrawal pursuant to
Section 10.10. It is understood and agreed that no earthquake or other
additional insurance need be required by Seller of any Mortgagor or maintained
on property acquired in respect of a Mortgage Loan, other than pursuant to such
applicable laws and regulations as shall at any time be in force and as shall
require such additional insurance. All policies required hereunder shall be
endorsed with standard mortgagee clauses with loss payable to Seller and its
successors and/or assigns, and shall provide for at least thirty (30) days prior
written notice of any cancellation, reduction in amount or material change in
coverage to Seller. Seller shall not interfere with the Mortgagor's freedom of
choice in selecting either his insurance carrier or agent.
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 Xxxxxx Xxx 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.
Section 10.16 Fidelity Bond; Errors and Omissions Insurance.
Seller shall maintain, 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 shall
protect and insure Seller against losses, including forgery, theft,
45
embezzlement, fraud, errors and omissions, failure to maintain any insurance
policies required pursuant to this Agreement, and negligent acts of such Seller
Employees. Such fidelity bond shall also protect and insure 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 10.16 requiring such fidelity bond and errors and
omissions insurance shall diminish or relieve Seller from its duties and
obligations as set forth in this Agreement. The minimum coverage under any such
Fidelity Bond and Errors and Omissions Insurance Policy shall be at least equal
to the amounts acceptable to Xxxxxx Mae or Xxxxxxx Mac. Upon the request of any
Purchaser, the Seller shall cause to be delivered to such Purchaser a
certificate of insurance for such Fidelity Bond and Errors and Omissions
Insurance Policy and a statement from the surety and the insurer that such
Fidelity Bond and Errors and Omissions Insurance Policy shall in no event be
terminated or materially modified without 30 days' prior written notice to the
Purchaser.
Section 10.17 Title, Management and Disposition of REO Property.
In the event that title to the 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 Purchaser, or in the event 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 Seller, at expense of
Purchaser, from an attorney duly licensed to practice law in the state where the
REO Property is located. The Person or Persons holding such title other than
Purchaser shall acknowledge in writing that such title is being held as nominee
for Purchaser or its designee.
Seller shall manage, conserve, protect and operate each REO Property for
Purchaser solely for the purpose of its prompt disposition and sale. Seller
shall either itself or through an agent selected by Seller, 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. 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 Seller deems to be in the best
interest of Purchaser.
With respect to all REO Property, Seller shall hold all funds collected
and received in connection with the operation of the REO Property separate and
apart from its own funds or general assets and shall establish and maintain with
respect to all REO Property an REO Account or Accounts, in the form of a
non-interest bearing demand account, titled "[Seller] in trust for
Purchaser-Fixed Rate Mortgage Loans as tenants in common" unless an Opinion of
Counsel is obtained by Seller to the effect that the classification as a grantor
trust for federal income tax purposes of the arrangement under which the
Mortgage Loans and the REO Property are held will not be adversely affected by
holding such funds in another manner. Such REO Account shall be established with
Seller or, with the prior consent of Purchaser, with a commercial bank, a mutual
savings bank or a savings and loan association. The creation of the REO Account
shall be evidenced by (a) a certification in the form shown in Exhibit D hereto,
in the case of an
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account established with Citibank, or (b) a letter agreement in the form shown
in Exhibit E hereto, in the case of an account held by a depository other than
Citibank. In either case, an original of such certification or letter agreement
shall be furnished to Purchaser upon request.
Seller shall cause to be deposited on a daily basis in the REO Account all
revenues received with respect to the conservation and disposition of the
related REO Property and shall withdraw therefrom funds necessary for the proper
operation, management and maintenance of the REO Property, including the cost of
maintaining any hazard insurance pursuant to Section 10.15 hereof and the fees
of any managing agent acting on behalf of Seller. Seller shall not be entitled
to retain interest paid or other earnings, if any, on funds deposited in such
REO Account. Seller shall make distributions as required on each Remittance Date
to Purchaser of the net cash flow from the REO Property (which shall equal the
revenues from such REO Property net of the expenses described above and of any
reserves reasonably required from time to time to be maintained to satisfy
anticipated liabilities for such expenses).
Seller shall use its best efforts to dispose of the REO Property as soon
as possible and shall sell such REO Property as soon as practicable but in any
event within one (1) year after title has been taken to such REO Property unless
(i) a REMIC election has not been made with respect to the arrangement under
which the Mortgage Loans and the REO Property are held, and (ii) the Seller
determines 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, (i) the Seller shall report
monthly to the Purchaser as to the progress being made in selling such REO
Property and (ii) If a purchase money mortgage is taken in accordance with such
sale, such purchase money mortgage shall not be held pursuant to this Agreement.
The Seller shall also maintain on each REO Property fire and hazard insurance
with extended coverage in 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 Seller and shall
be made at such price, and upon such terms and conditions, as Seller deems to be
in the best interests of Purchaser. Upon the request of Purchaser, and at
Purchaser's expense, Seller shall cause an appraisal of the REO Property to be
performed for Purchaser. The proceeds of sale of the REO Property shall be
promptly deposited in the REO Account and, as soon as practical thereafter, the
expenses of such sale shall be paid, Seller shall reimburse itself for any and
all related unreimbursed Servicing Advances, unpaid Servicing Fees, any and all
unreimbursed advances made and any appraisal performed and the net cash proceeds
of such sale remaining in the REO Account shall be distributed to Purchaser.
Upon request, with respect to any REO Property, Seller shall furnish to
Purchaser a statement covering Seller's efforts in connection with the sale of
that REO Property and any rental of the REO Property incidental to the sale
thereof for the previous month (together with an operating statement). That
statement shall be accompanied by such other information as Purchaser shall
reasonably request.
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Section 10.16 Real Estate Owned Reports.
Together with the statement furnished pursuant to Section 10.17, the
Seller shall furnish to the Purchaser on or before the Remittance Date 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 10.17 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 10.18 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. The Seller shall file information reports with
respect to the receipt of mortgage interest received in a trade or business and
information returns relating to cancellation of indebtedness income with respect
to any Mortgaged Property as required by the Code. Such reports shall be in form
and substance sufficient to meet the reporting requirements imposed by the Code.
Section 10.19 Inspections.
If any Mortgage Loan is more than 60 days delinquent, the Seller shall
inspect the Mortgaged Property and shall conduct subsequent inspections in
accordance with Xxxxxx Mae or Customary Servicing Procedures or as may be
required by the PMI insurer. The Seller shall produce a report of each such
inspection upon written request by the Purchaser.
Section 10.20 Maintenance of PMI Policy; Claims.
With respect to each Mortgage Loan with an LTV of greater than 80% at the
time of origination, the Seller shall, without any cost to the Purchaser,
maintain in full force and effect a PMI Policy insuring that portion of the
Mortgage Loan over 78% of value until terminated pursuant to the Homeowners
Protection Act of 1998, 12 UCS Section.4901, et seq. In the event that such PMI
Policy shall be terminated other than as required by law, the Seller shall
obtain from another Qualified Insurer a comparable replacement policy, with a
total coverage equal to the remaining coverage of such terminated PMI Policy. If
the insurer shall cease to be a Qualified Insurer, the Seller shall determine
whether recoveries under the PMI Policy are jeopardized for reasons related to
the financial condition of such insurer, it being understood that the Seller
shall in no event have any responsibility or liability for any failure to
recover under the PMI Policy for such reason. If the Seller determines that
recoveries are so jeopardized, it shall notify the Purchaser and the Mortgagor,
if required, and obtain from another Qualified Insurer a
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replacement insurance policy. The Seller shall not take any action which would
result in noncoverage under any applicable PMI Policy of any loss which, but for
the actions of the Seller would have been covered thereunder. In connection with
any assumption or substitution agreement entered into or to be entered into
pursuant to Section 12.01, the Seller shall promptly notify the insurer under
the related PMI Policy, if any, of such assumption or substitution of liability
in accordance with the terms of such PMI Policy and shall take all actions which
may be required by such insurer as a condition to the continuation of coverage
under such PMI Policy. If such PMI Policy is terminated as a result of such
assumption or substitution of liability, the Seller shall obtain a replacement
PMI Policy as provided above.
In connection with its activities as servicer, the Seller
agrees to prepare and present, on behalf of itself and the Purchaser, claims to
the insurer under any PMI Policy in a timely fashion in accordance with the
terms of such PMI Policy and, in this regard, to take such action as shall be
necessary to permit recovery under any PMI Policy respecting a defaulted
Mortgage Loan. Pursuant to Section 10.11, any amounts collected by the Seller
under any PMI Policy shall be deposited in the Custodial Account, subject to
withdrawal pursuant to Section 10.10.
Section 10.21 Credit Reporting.
The Seller shall fully furnish, in accordance with the Fair Credit
Reporting Act and its implementing regulations, accurate and complete
information on the Mortgagor credit files to Equifax, Experian and Trans Union
Credit Information Seller on a monthly basis.
ARTICLE XI
PAYMENTS TO PURCHASER
Section 11.01 Distributions.
On each Remittance Date, Seller shall remit by wire transfer of
immediately available funds to the account designated in writing by Purchaser of
record on the preceding Record Date (a) all amounts deposited in the Custodial
Account as of the close of business on the preceding Determination Date (net of
all amounts withdrawable therefrom pursuant to Section 10.10), plus (b) all
amounts, if any, which Seller is obligated to distribute pursuant to Section
11.03, minus (c) any amounts attributable to Monthly Payments collected but due
on a Due Date or Dates subsequent to the related Due Period, minus (d) any
amounts attributable to Principal Prepayments received after the last day of the
calendar month preceding the month of the Remittance Date, which amounts shall
be remitted on the following Remittance Date, together with any additional
interest required to be deposited in the Custodial Account in connection with
such Principal Prepayments in accordance with Section 10.09(h).
With respect to any remittance received by Purchaser after the Business
Day on which such payment was due, Seller shall pay to Purchaser interest on any
such late payment at a rate
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equal to the one day libor rate divided by 365, but in no event greater than the
maximum amount permitted by applicable law. Such interest shall be paid by
Seller to Purchaser on the date such late payment is made and shall cover the
period commencing with the Business Day on which such payment was due and ending
with the Business Day on which such payment is made, both inclusive. The payment
by Seller of any such interest shall not be deemed an extension of time for
payment or a waiver of any Event of Default by Seller.
To the extent that the amount of a remittance or distribution to Purchaser
made hereunder is in greater than the amount thereof properly to be remitted
pursuant to the terms of this Agreement, Seller will give prompt written notice
thereof to Purchaser after Seller's discovery thereof, including the amount of
such remittance or distribution that was paid in error. If Purchaser is in
agreement with the amount of this over remittance, if, by the Remittance Date
immediately following such notice, Purchaser has not reimbursed the Custodial
Account or Seller, as applicable, for the amount of such erroneous remittance or
distribution (without any liability on the part of Purchaser for interest
thereon), Seller shall be entitled to withhold such amount from the remittance
to be made on such Remittance Date.
Section 11.02 Statements to Purchaser.
On or before the fifth (5th) Business Day of each month, the Servicer
shall provide the Owner an electronically transmitted file containing the data
set forth in Exhibit J or such data as may be mutually agreed to by Seller and
Purchaser.
In addition, within a reasonable period of time after the end of each
calendar year, Seller will furnish a report to each Person that was a Purchaser
at any time during such calendar year. Such report shall state the aggregate of
amounts (a) remitted on each Remittance Date which is allocable to principal and
allocable to interest and (b) of servicing compensation received by Seller as
servicer on each Remittance Date for such calendar year or, in the event such
Person was a Purchaser of record during only a portion of such calendar year,
for the applicable portion of such year. Such obligation of Seller shall be
deemed to have been satisfied to the extent that substantially comparable
information shall be provided by Seller pursuant to any requirements of the
Internal Revenue Code of 1986 as from time to time in force.
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 Purchaser pursuant to any applicable law with respect to the
Mortgage Loans and the transactions contemplated hereby. In addition, Seller
shall provide Purchaser with such information concerning the Mortgage Loans as
is necessary for such Purchaser to prepare its federal income tax return as
Purchaser may reasonably request from time to time.
Section 11.03 Advances by Seller.
On the Business Day immediately preceding each Remittance Date, Seller
shall deposit in the Custodial Account from its own funds an amount equal to all
Monthly Payments (with interest adjusted to the Mortgage Loan Remittance Rate)
which were due on the Mortgage Loans during the applicable Due Period and which
were delinquent at the close of business on the
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immediately preceding Determination Date. This deposit may be offset by any
funds held for a future distribution not due on the current Remittance Date.
Seller's obligation to make such Monthly Advances as to any Mortgage Loan will
continue through the last Monthly Payment due prior to the payment in full of
the Mortgage Loan, or through the last Remittance Date prior to the Remittance
Date for the distribution of all Liquidation Proceeds and other payments or
recoveries (including REO Disposition Proceeds, Insurance Proceeds and
Condemnation Proceeds) with respect to the Mortgage Loan, provided, however,
that such obligation shall cease if (a) there has been a final disposition of
the Mortgage Loan or (b) if Seller, in its good faith judgment, determines that
such advances would not be recoverable.pursuant to Section 10.10(d). The
determination by Seller that an advance, if made, would be nonrecoverable, shall
be evidenced by an Officer's Certificate of Seller, delivered to Purchaser,
which details the reasons for such determination and contains an appraisal of
the value of the Mortgaged Property.
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ARTICLE XII
GENERAL SERVICING PROCEDURE
Section 12.01 Assumption Agreements.
Seller will use its best efforts to enforce any "due-on-sale" provision
contained in any Mortgage or Mortgage Note to the extent permitted by law,
provided that Seller shall permit such assumption if so required in accordance
with the terms of the Mortgage or the Mortgage Note. When the Mortgaged Property
has been conveyed by the Mortgagor, Seller will, 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, Seller will not exercise such rights if prohibited by law from doing so
or if the exercise of such rights would impair or threaten to impair any
recovery under the related private mortgage guaranty policy, if any. If Seller
reasonably believes it is unable under applicable law to enforce such
"due-on-sale" clause, Seller may enter into 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, to the extent
permitted by applicable law, the Mortgagor remains liable thereon. In connection
with any such assumption, the outstanding principal amount, the Monthly Payment
and the Mortgage Interest Rate of the related Mortgage Note shall not be
changed, and the term of the Mortgage Loan will not be increased or decreased.
If an assumption is allowed pursuant to this Section 12.01, Seller with the
prior consent of the private mortgage guaranty insurer, if any, is authorized to
enter into a substitution of liability agreement with Purchaser of the Mortgaged
Property pursuant to which the original Mortgagor is released from liability and
Purchaser of the Mortgaged Property is substituted as Mortgagor and becomes
liable under the Mortgage Note. Any fee collected by Seller for entering into
any such assumption agreement will be retained by Seller as additional servicing
compensation.
In connection with any such assumption or substitution of liability, the
Seller shall follow the underwriting practices and procedures of prudent
mortgage lenders mortgage loans similar to the Mortgage Loans in the state in
which the related Mortgaged Property is located. With respect to an assumption
or substitution of liability, Mortgage Loan Interest Rate, the amount of the
Monthly Payment, and the final maturity date of such Mortgage Note may not be
changed.
Section 12.02 Satisfaction of Mortgages and Release of Mortgage Files.
Upon the payment in full of any Mortgage Loan, or the receipt by Seller of
a notification that payment in full will be escrowed in a manner customary for
such purposes, Seller or the Subservicer will obtain the portion of the Mortgage
File that is in the possession of the Custodian, prepare and process any
required satisfaction or release of the Mortgage and notify Purchaser as
provided in Section 11.02. Purchaser shall indemnify Seller for any
out-of-pocket expenses that the Seller may sustain from the Custodian's failure
to deliver such Mortgage File in a timely manner.
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In the event Seller grants a satisfaction or release of a Mortgage without
having obtained payment in full of the indebtedness secured by the Mortgage or
should Seller otherwise prejudice any right Purchaser may have under the
mortgage instruments, Seller, upon written demand of Purchaser, shall remit to
Purchaser the Stated Principal Balance of the related Mortgage Loan by deposit
thereof in the Custodial Account. Seller shall maintain the Fidelity Bond and
errors and omissions insurance as provided for in Section 10.16 insuring Seller
against any loss it may sustain with respect to any Mortgage Loan not satisfied
in accordance with the procedures set forth herein.
Section 12.03 Servicing Compensation.
As compensation for its services hereunder, Seller shall be entitled to
retain from interest payments on the Mortgage Loans the Servicing Fee.
Additional servicing compensation in the form of assumption fees and late
payment charges shall be retained by Seller or any related Subservicer to the
extent not required to be deposited in the Custodial Account. 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 therefor except
as specifically provided for herein.
Section 12.04 Annual Statement as to Compliance.
Seller will deliver to Purchaser, on or before March 10 of each year
beginning March 2005, an Officers' Certificate stating that (a) a review of the
activities of Seller during the preceding calendar year and its performance
under this Agreement has been made under such officer's supervision, and (b) to
the best of such officer's knowledge, based on such review, 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 Seller to cure such default.
Section 12.05 Annual Independent Public Accountants' Servicing Report.
On or before March 10 of each year beginning March 2005, 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 Purchaser to the effect that such firm has examined certain documents and
records, relating to the servicing of mortgage loans during the immediately
preceding fiscal year of Seller and that such firm is of the opinion 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.
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Section 12.06 Purchaser's Right to Examine Seller Records.
Purchaser shall have the right, at all reasonable times upon reasonable
notice and as often as reasonably required, to examine and audit any and all of
the books, records or other information of Seller whether held by Seller or by
another on behalf of Seller, which are relevant to the performance or observance
by Seller of the terms, covenants or conditions of this Agreement.
Section 12.07 Seller Shall Provide Access/Information as Reasonably
Required.
Seller shall provide to Purchaser access to any documentation regarding
the Mortgage Loans which may be required by applicable regulations (the
"Regulations"). Such access shall be afforded without charge, but only upon
reasonable request, during normal business hours and at the offices of Seller.
In addition, Seller shall furnish upon request by Purchaser, during the
term of this Agreement, such periodic, special or other reports or information,
whether or not provided for herein, as shall be necessary, reasonable and
appropriate with respect to the purposes of this Agreement and the Regulations.
All such reports or information shall be provided by and in accordance with all
reasonable instructions and directions Purchaser may require. Seller agrees to
execute and deliver all such instruments and take all such action as Purchaser,
from time to time, may reasonably request in order to effectuate the purposes
and to carry out the terms of this Agreement.
Section 12.08 Financial Statements; Servicing Facility.
The Seller also shall make available to Purchaser or 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.
Section 12.09 Compliance with Safeguarding Customer Information
Requirements.
The Seller has implemented and will maintain security measures designed to
meet the objectives of the Interagency Guidelines Establishing Standards for
Safeguarding Customer Information published in final form on February 1, 2001,
66 Fed. Reg. 8616, and the rules promulgated thereunder, as amended from time to
time (the "Guidelines"). The Seller shall promptly provide Purchaser with
information regarding such security measures upon the reasonable request of
Purchaser which information shall include, but not be limited to, any SAS 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.
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Section 12.10 Appointment and Designation of Master Servicer.
The Purchaser hereby appoints and designates Aurora Loan Services, Inc. as
its master servicer (the "Master Servicer") for the Mortgage Loans subject to
this Agreement. The Seller is hereby authorized and instructed to take any and
all instructions with respect to servicing the Mortgage Loans hereunder as if
the Master Servicer were the Purchaser hereunder. The authorization and
instruction set forth herein shall remain in effect until such time as the
Seller shall receive written instruction from the Purchaser that such
authorization and instruction is terminated.
Section 12.11 Compliance with REMIC Provisions.
If a REMIC election has been made with respect to the arrangement under
which the Mortgage Loans and REO Property are held, the Seller shall not take
any action, cause the REMIC to take any action or fail to take (or fail to cause
to be taken) any action that, under the REMIC Provisions, if taken or not taken,
as the case may be, could (i) endanger the status of the REMIC as a REMIC or
(ii) result in the imposition of a tax upon the REMIC (including but not limited
to the tax on "prohibited transactions" as defined in Section 860F(a)(2) of the
Code and the tax on "contributions" to a REMIC set forth in Section 860G(d) of
the Code) unless the Seller has received an Opinion of Counsel (at the expense
of the party seeking to take such action) to the effect that the contemplated
action will not endanger such REMIC status or result in the imposition of any
such tax.
ARTICLE XIII
SELLER
Section 13.01 Indemnification; Third Party Claims.
In addition to the indemnification provided in Section 6.03, Seller shall
indemnify and hold harmless Purchaser against any and all claims, losses,
penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments, and any other costs, fees and expenses that Purchaser may
sustain in any way related to (a) the failure of Seller to perform its duties,
obligations, covenants and agreements and service the Mortgage Loans in strict
compliance with the terms of this Agreement or Reconstitution Agreement entered
into pursuant to Section 5.05, and/or (b) comply with applicable law. Seller
shall immediately notify Purchaser if a claim is made by a third party with
respect to this Agreement or any Reconstitution Agreement or the Mortgage Loans,
and Seller shall assume (with the consent of Purchaser) the defense of any such
claim and pay all expenses in connection therewith, including counsel fees, and
promptly pay, discharge and satisfy any judgment or decree which may be entered
against Seller or Purchaser in respect of such claim. Seller shall provide
Purchaser with a written report of all expenses and advances incurred by Seller
pursuant to this Section 13.01 and Purchaser shall promptly reimburse Seller for
all amounts advanced by it pursuant to the preceding sentence except when the
claim in any way relates to Seller's indemnification pursuant to Section 6.03,
or the failure of the Seller to (a) service and administer the Mortgage Loans in
strict compliance with the terms of this Agreement or any Reconstitution
Agreement, and/or (b) comply with applicable law. Notwithstanding anything to
the contrary in this Agreement, in the
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event that Purchaser or its designee becomes record owner of any Mortgaged
Property, Seller shall not be deemed to have failed to perform its obligations
hereunder where it fails to act in response to any notice delivered to the
record holder of the Mortgaged Property if (i) statutory notice was not
delivered to Seller, (ii) Seller had no actual knowledge of the situation
surrounding such notice and (iii) Seller's inaction was due entirely to Seller's
lack of receipt of such notice.
Section 13.02 Merger or Consolidation of Seller.
Seller will keep in full effect its existence, rights and franchises as a
corporation, and will obtain and preserve its qualification to do business as a
foreign corporation in each jurisdiction in which such qualification is or shall
be necessary to protect the validity and enforceability of this Agreement or any
of the Mortgage Loans and to perform its duties under this Agreement.
Any Person into which Seller may be merged or consolidated, or any
corporation resulting from any merger, conversion or consolidation to which
Seller shall be a party, or any Person succeeding to substantially all of the
business of Seller (whether or not related to loan servicing), shall be the
successor of Seller hereunder, without the execution or filing of any paper or
any further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding provided, however, that the successor or surviving
Person shall be an institution (i) having a net worth of not less than
$25,000,000 and (ii) is a Xxxxxx Xxx/Xxxxxxx Mac-approved Seller in good
standing.
Section 13.03 Limitation on Liability of Seller and Others.
Seller and any director, officer, employee or agent of Seller may rely on
any document of any kind which it in good faith reasonably believes to be
genuine and to have been adopted or signed by the proper authorities respecting
any matters arising hereunder 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 other
liability which would otherwise be imposed under this Agreement. Subject to the
terms of Section 13.01, Seller shall have no obligation to appear with respect
to, prosecute or defend any legal action which is not incidental to Seller's
duty to service the Mortgage Loans in accordance with this Agreement.
Section 13.04 Seller Not to Resign.
Seller shall not assign this Agreement nor resign from the obligations and
duties hereby imposed on it except by mutual consent of Seller and Purchaser or
upon the determination that Seller's duties hereunder are no longer permissible
under applicable law and such incapacity cannot be cured by 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 16.01.
The Seller acknowledges that the Purchaser has acted in reliance upon the
Seller's
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independent status, the adequacy of its servicing facilities, plan, personnel,
records and procedures, its integrity, reputation and financial standing and the
continuance thereof. Without in any way limiting the generality of this Section,
the Seller shall not either assign this Agreement or the servicing hereunder or
delegate its rights or 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 approval of the Purchaser, which consent will not be
unreasonably withheld. Notwithstanding the foregoing, Seller shall have the
right to assign its rights under this Agreement to Citigroup, Inc. or any
subsidiary of Citigroup, Inc.
ARTICLE XIV
DEFAULT
Section 14.01 Events of Default.
In case one or more of the following Events of Default by Seller shall
occur and be continuing, that is to say:
(a) any failure by Seller to remit to Purchaser any payment required to
be made under the terms of this Agreement which continues unremedied
for a period of three (3) Business Days after the date upon which
written notice of such failure, requiring the same to be remedied,
shall have been given to Seller by Purchaser; or
(b) failure by Seller to duly observe or perform, in any material
respect, any other covenants, obligations or agreements of Seller as
set forth in this Agreement which failure continues unremedied for a
period of thirty (30) days after the date on which written notice of
such failure, requiring the same to be remedied, shall have been
given to Seller by 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, bankruptcy, readjustment of debt,
marshalling of assets and liabilities or similar proceedings, or for
the winding-up or liquidation of its affairs, shall have been
entered against Seller and such decree or order shall have remained
in force, undischarged or unstayed for a period of sixty (60) days;
or
(d) Seller shall consent to the appointment of a conservator or receiver
or liquidator in any insolvency, bankruptcy, readjustment of debt,
marshalling of assets and liabilities or similar proceedings of or
relating to Seller or relating to all or substantially all of
Seller's property; or
(e) Seller shall admit in writing its inability to pay its debts 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
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(f) Seller attempts to assign this Agreement except in compliance with
the terms of this Agreement; or
(g) failure by Seller to be in compliance with the "doing business" or
licensing laws of any jurisdiction where a Mortgaged Property is
located which materially and adversely affects the servicing of the
Mortgage Loans or the enforceability or lien priority of the related
Mortgage Loan; or
(h) failure by the Seller to maintain its license to do business in
any jurisdiction where the Mortgaged Property is located if such
license is required; or
(i) the Seller ceases to meet the qualifications of a Xxxxxx Mae/Xxxxxxx
Mac servicer; or
(j) after a Reconstitution in a Pass-Through Transfer, any of the Rating
Agencies reduces or withdraws the rating of any of the certificates
issued by a securitization trust that owns the Mortgage Loans due to
a reason attributable to the Seller; or
(k) the Seller attempts to assign its right to servicing
compensation (except any assignments of servicing revenue by Seller
to an affiliate of Seller) hereunder or to assign this Agreement or
the servicing responsibilities hereunder or to delegate its duties
hereunder or any portion thereof in violation of Section 13.04.
then, and in each and every such case, so long as an Event of Default shall not
have been remedied, Purchaser, by notice in writing to Seller, may, in addition
to whatever rights Purchaser may have at law or equity to damages, including
injunctive relief and specific performance, terminate all the rights and
obligations of Seller under this Agreement and in and to the Mortgage Loans and
the proceeds thereof. On and after the receipt by Seller of such written notice
all authority and power of 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 16.01. Upon written request from Purchaser, Seller
shall prepare, execute and deliver to a successor any and all documents and
other instruments, place in such successor's possession all Mortgage Files and
do or cause to be done all other acts or things 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 to the successor at Seller's sole expense. Seller agrees to cooperate
with Purchaser and such successor in effecting the termination of Seller's
responsibilities and rights hereunder, including, without limitation, the
transfer to such successor for administration by it of all amounts which shall
at the time be credited by Seller to the Custodial Account or Escrow Account or
thereafter received with respect to the Mortgage Loans.
Section 14.02 Waiver of Defaults.
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Purchaser may waive only by written notice any default by Seller in the
performance of its obligations hereunder and its consequences. Upon any such
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 thereto except to the extent
expressly so waived in writing.
ARTICLE XV
TERMINATION
Section 15.01 Termination.
This Agreement shall terminate upon either: (a) the later of the
distribution to Purchaser of final payment or liquidation with respect to the
last Mortgage Loan (or advances of same by Seller), or the disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure with respect
to the last Mortgage Loan and the remittance of all funds due hereunder; (b)
mutual consent of Seller and Purchaser in writing; or (c) the repurchase by
Seller of all Mortgage Loans and all REO Property which has not been sold at a
price equal to the 100% of the outstanding principal balance of each Mortgage
Loan on the day of repurchase plus accrued interest thereon at a rate equal to
the Mortgage Loan Remittance Rate to the date of repurchase plus the appraised
value of any such REO Property, such appraisal to be conducted by an appraiser
mutually agreed upon by Seller and Purchaser.
Section 15.02 Termination Without Cause.
The Purchaser may terminate, at its sole option, any rights the Seller may
have hereunder, without cause as provided in this Section 15.02. Any such notice
of termination shall be in writing and delivered to the Seller by registered
mail as provided in Section 16.06.
In the event the Purchaser terminates the Seller without cause with
respect to some or all of the Mortgage Loans, the Purchaser shall be required to
pay to the Seller a Termination Fee in an amount equal to a multiple of ten
times the related servicing fee for each Mortgage Loan Package of the terminated
Mortgage Loans as of the date of such termination or a mutually agreed upon
price by the Seller and Purchaser.
ARTICLE XVI
MISCELLANEOUS PROVISIONS
Section 16.01 Successor to Seller.
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Prior to termination of Seller's responsibilities and duties under this
Agreement pursuant to Sections 13.04, 14.01 or 15.01(b), Purchaser shall (a)
succeed to and assume all of Seller's responsibilities, rights, duties and
obligations under this Agreement and the Subservicing Agreements, or (b) appoint
a successor which shall succeed to all rights and assume all of the
responsibilities, duties and liabilities of Seller under this Agreement and the
Subservicing Agreements prior to the termination of Seller's responsibilities,
duties and liabilities under this Agreement. In connection with such appointment
and assumption, Purchaser may make such arrangements for the compensation of
such successor out of payments on Mortgage Loans as it and such successor shall
agree; provided, however, that no such compensation shall be in excess of that
permitted Seller under this Agreement without the consent of Purchaser. In the
event that Seller's duties, responsibilities and liabilities under this
Agreement shall be terminated pursuant to the aforementioned Sections, Seller
shall discharge such duties and responsibilities during the period from the date
it acquires knowledge of such termination until the effective date thereof with
the same degree of diligence and prudence which it is obligated to exercise
under this Agreement, and shall take no action whatsoever that might impair or
prejudice the rights or financial condition of its successor. The resignation or
removal of Seller pursuant to the aforementioned Sections shall not become
effective until a successor shall be appointed pursuant to this Section and
shall in no event relieve Seller of the representations and warranties made
pursuant to Sections 6.01 and 6.02 and the remedies available to Purchaser under
Section 6.03, it being understood and agreed that the provisions of such
Sections 6.01, 6.02, 6.03 and 6.04 shall be applicable to Seller notwithstanding
any such sale, assignment, resignation or termination of Seller, or the
termination of this Agreement.
Any successor appointed as provided herein shall execute, acknowledge and
deliver to Seller and to Purchaser an instrument accepting such appointment,
whereupon such successor shall become fully vested with all the rights, powers,
duties, responsibilities, obligations and liabilities of Seller, with like
effect as if originally named as a party to this Agreement. Any termination or
resignation of Seller or this Agreement pursuant to Section 13.04, 14.01 or
15.01 shall not affect any claims that Purchaser may have against Seller arising
prior to any such termination or resignation.
Seller shall promptly deliver to the successor the funds in the Custodial
Account and Escrow Account and all Mortgage Files and related documents and
statements held by it hereunder and Seller shall account for all funds and shall
execute and deliver such instruments and do such other things as may reasonably
be required to more fully and definitively vest in the successor all such
rights, powers, duties, responsibilities, obligations and liabilities of Seller.
Upon a successor's acceptance of appointment as such, Seller shall notify
by mail Purchaser of such appointment.
Section 16.02 Amendment.
This Agreement may be amended from time to time by Seller and Purchaser by
written agreement signed by Seller and Purchaser; provided that if any of the
rights, duties or obligations of Seller as such would be affected by such
amendatory agreement, such agreement must also be consented to by Seller.
60
Section 16.03 Recordation of Agreement.
To the extent permitted by applicable law, this Agreement 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
properties subject to the Mortgages are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected by Seller
at Purchaser's expense upon direction of Purchaser, but only when such direction
is accompanied by an Opinion of Counsel to the effect that such recordation
materially and beneficially affects the interests of Purchaser or is necessary
for the administration or servicing of the Mortgage Loans.
Section 16.04 Duration of Agreement.
This Agreement shall continue in existence and effect until terminated as
herein provided.
Section 16.05 Governing Law.
This Agreement shall be construed in accordance with the laws of the State
of New York, except to the extent preempted by Federal law, and the obligations,
rights and remedies of the parties hereunder shall be determined in accordance
with such laws.
Section 16.06 Notices.
All demands, notices and communications hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered at or mailed by
registered mail, postage prepaid, to (a) in the case of Seller, CitiMortgage,
Inc. 0000 Xxxxxxxxxx Xxxxx, XX 00, X'Xxxxxx, Xxxxxxxx 00000, Attention: Capital
Markets, with a copy to Investor Reporting Department, MS 314 or such other
address as may hereafter be furnished to Purchaser in writing by Seller and (b)
in the case of Purchaser, Xxxxxx Brothers Bank, FSB, 000 0xx Xxxxxx, 0xx Xxxxx,
Xxx Xxxx, XX 00000, Attention: Contract Finance or such other address as may
hereafter be furnished to Seller in writing by Purchaser.
Section 16.07 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. If the invalidity of any part, provision, representation or warranty
of this Agreement shall deprive any party of the economic benefit intended to be
conferred by this Agreement, the parties shall negotiate in good faith to
develop a structure the economic effect of which is nearly as possible the same
as the economic effect of this Agreement without regard to such inability.
61
Section 16.08 No Partnership.
Nothing herein contained shall be deemed or construed to create a
co-partnership or joint venture between the parties hereto and the services of
Seller shall be rendered as an independent contractor and not as agent for
Purchaser.
Section 16.09 Execution; Successors and Assigns.
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 13.04, this Agreement
shall inure to the benefit of and be binding upon Seller, Seller and Purchaser
and their respective successors and assigns.
Section 16.10 Further Assurances.
Seller understands that Purchaser may resell the Mortgage Loans as whole
loans or as part of a securitization in which a third party may act as master
servicer. In the event that as part of such sale or securitization, additional
information regarding the Mortgage Loans or modification of the reporting
requirements may be requested, Seller agrees to review such requests by
Purchaser's transferee or master servicer only if, in Seller's judgment,
fulfilling such requests would require no material modifications to Seller's
servicing processes or systems and any and all costs to provide such reports and
information shall be borne by Purchaser.
Section 16.11 No Personal Solicitation.
From and after the related Closing Date, the Seller hereby agrees that it
will not take any action or permit or cause any action to be taken by any of its
agents or affiliates, or by any independent contractors or independent mortgage
brokerage companies on the Seller's behalf, to personally, by telephone or mail,
target solicit the Mortgagor under any Mortgage Loan for the purpose of
refinancing such Mortgage Loan. It is understood and agreed that promotions
undertaken by the Seller or any of its affiliates which are directed to the
general public at large, including, without limitation, mass mailings based on
commercially acquired mailing lists, newspaper, radio and television
advertisements shall not constitute solicitation under this Section 16.11.
62
IN WITNESS WHEREOF, Seller and Purchaser have caused their names to be
signed hereto by their respective officers thereunto duly authorized as of the
day and year first above written.
CITIMORTGAGE, INC.
By:_____________________________
Name:___________________________
Title:__________________________
XXXXXX BROTHERS BANK, FSB
By:_____________________________
Name:___________________________
Title:__________________________
63
EXHIBIT A
CONTENTS OF MORTGAGE FILES
With respect to each Mortgage Loan, the Mortgage File shall include each
of the following items, all of which shall be available for inspection by
Purchaser:
1. Mortgage Loan Documents.
2. Copy of survey of the Mortgaged Property (if the title insurance policy
contains a survey exception).
3. Copy of each instrument necessary to complete identification of any
exception set forth in the exception schedule in the title policy, e.g.,
map or plat, restrictions, easements, sewer agreements, home association
declarations, etc.
4. Mortgage Loan closing statement (Form HUD-1) and any other
truth-in-lending or real estate settlement procedure forms required by
law.
5. Residential loan application.
6. Verification of acceptable evidence of source and amount of downpayment,
if applicable.
7. Verification of employment and income.
8. Credit report on the Mortgagor.
9. Residential appraisal report.
10. Photograph of the property.
11. Tax receipts, insurance premium receipts, ledger sheets, payment records,
insurance claim files and correspondence, correspondence, current and
historical computerized data files, underwriting standards used for
origination and all other papers and records developed or originated by
Seller or others, required to document the Mortgage Loan or to service the
Mortgage Loan.
12. Original of the related primary mortgage guaranty insurance policy, if
any, or a copy thereof.
13. The original or copy thereof hazard insurance policy and, if required by
law, flood insurance policy.
14. All required disclosure statements.
15. Sales contract, if applicable.
Upon request from the Purchaser, in the event an Officer's
Certificate of the Seller is delivered to the Custodian because of a delay
caused by the public recording office in returning any recorded document, the
Seller shall deliver to the Custodian, within 180 days of the related Closing
Date, an Officer's Certificate which shall (i) identify the recorded document,
(ii) state that the recorded document has not been delivered to the Custodian
due solely to a delay caused by the public recording office, (iii) state the
amount of time generally required by the applicable recording office to record
and return a document submitted for recordation, and (iv) specify the date the
applicable recorded document will be delivered to the Custodian. The Seller
shall be required to deliver to the Custodian the applicable recorded document
by the date specified in (iv) above. An extension of the date specified in (iv)
above may be requested from the Purchaser, which consent shall not be
unreasonably withheld.
EXHIBIT B
CUSTODIAL ACCOUNT CERTIFICATION
______ __, 2004
Citibank (West), FSB hereby certifies that it has established the account
described below as a Custodial Account pursuant to Section 10.09 of Mortgage
Loan Purchase and Servicing Agreement, dated as of ___________ 1, 2004, Fixed
Rate Mortgage Loans.
Title of Account: "CitiMortgage, Inc. in trust for Purchaser and
various Mortgagors - Fixed Rate Mortgages Loans"
Account Number: __________________________
Address of office or
branch of Citibank
(West), FSB
at which Account is
maintained: __________________________
__________________________
Citibank (West), FSB
By _________________________
EXHIBIT C
CUSTODIAL ACCOUNT LETTER AGREEMENT
______ __, 2004
To: _____________________________________
_____________________________________
_____________________________________
(the "Depository")
As "Seller" under Mortgage Loan Purchase and Servicing Agreement, dated as
of ___________ 1, 2004, Fixed Rate Mortgage Loans (the "Agreement"), we hereby
authorize and request you to establish an account, as a Custodial Account
pursuant to Section 10.09 of the Agreement, to be designated as "[Seller], in
trust for Purchaser and various Mortgagors - Fixed Rate Mortgage Loans". All
deposits in the account shall be subject to withdrawal therefrom by order signed
by Seller. This letter is submitted to you in duplicate. Please execute and
return one original to us.
CitiMortgage, Inc.
By __________________________
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. The full amount deposited at any time in the
account will be insured by the Federal Deposit Insurance Corporation through the
Bank Insurance Fund ("BIF") or the Savings Association Insurance Fund ("SAIF")
___________________________
(Name of Depository)
By _________________________
EXHIBIT D
ESCROW ACCOUNT CERTIFICATION
(date)
Citibank (West), FSB hereby certifies that it has established the
non-interest bearing account described below as an Escrow Account pursuant to
Section 10.11 of Mortgage Loan Purchase and Servicing Agreement, dated as of
___________ 1, 2004, Fixed Rate Mortgage Loans.
Title of Account: "CitiMortgage, Inc. in trust for Purchaser -
Fixed Rate Mortgage Loans, as tenants in common"
Account Number: __________________________
Address of office or
branch of Citibank
(West), FSB
at which Account is
maintained: __________________________
__________________________
Citibank (West), FSB
By __________________________
EXHIBIT E
ESCROW ACCOUNT LETTER AGREEMENT
(date)
To: _____________________________________
_____________________________________
_____________________________________
(the "Depository")
As "Seller" under Mortgage Loan Purchase and Servicing Agreement, dated as
of ___________ 1, 2004, Fixed Rate Mortgage Loans (the "Agreement"), we hereby
authorize and request you to establish a non-interest bearing account, as an
Escrow Account pursuant to Section 10.11 of the Agreement, to be designated as
"[Seller], in trust for Purchaser - Fixed Rate Mortgage Loans, as tenants in
common." All deposits in the account shall be subject to withdrawal therefrom by
order signed by Seller. This letter is submitted to you in duplicate. Please
execute and return one original to us.
CitiMortgage, Inc.
By __________________________
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.
___________________________
(name of Depository)
By _________________________
EXHIBIT F
Mortgage Loan Schedule
1) the Seller's Mortgage Loan identifying number;
2) the Mortgagor's and Co-Mortgagor's (if applicable) names;
3) the street address of the Mortgaged Property, including the city, state, zip
code, county
4) lot number, block number and section number; if available
5) a code indicating whether the Mortgaged Property is a single family
residence, a 2 family dwelling, a 3-4 family dwelling, a manufactured home,
a PUD, a townhouse, a unit in a condominium project, a co-operative, a
mixed-use property, land, or a non-residential property
6) a code indicating the loan is a fixed rate or adjustable rate Mortgage Loan
(to be provided in accordance with Standard and Poor's loan type
requirements-Field 14 if the Mortgage Loans are non conforming);
7) Product Description (to be provided in accordance with Standard and Poor's
description categories-Field 7 in the Mortgage Loans are non conforming);
8) a code indicating the lien status of the Mortgage Loan;
9) the original months to maturity or the remaining months to maturity from the
Cut-off Date, in any case based on the original amortization schedule, and
if different, the maturity expressed in the same manner but based on the
actual amortization schedule;
10) the Loan to Value Ratio at origination;
11) the Mortgage Interest Rate as of the Cut-off Date;
12) a code indicating Interest Only Loans (Y/N);
13) the date on which the first payment is due;
14) the original term of the Mortgage Loan;
15) the stated maturity date;
16) the amount of the monthly principal and interest Payment;
17) the Annual Payment Cap expressed as a percentage (for Arms only);
18) the next due date as of the Cut-off Date;
19) the original principal amount of the Mortgage Loan;
20) the Senior and Subordinate balances (if applicable);
21) the closing date of the Mortgage Loan;
22) the principal balance of the Mortgage Loan as of the close of business on
the Cut-off Date; after deduction of payments of principal actually received
on or before the Cut-off Date;
23) monthly payment histories on current and prior mortgages (12 months if
available);
24) the loan purpose code;
25) the occupancy code;
26) the loan documentation type, (to be provided in conformance with Standard
and Poor's documentation categories- Field 5 if the Mortgage Loans are non
conforming);
27) the debt to income ratio(cannot guarantee accuracy of data provided);
28) the Mortgagor's and Co-Mortgagor's (if applicable) social security numbers;
29) the Mortgagor's original FICO score ;
30) tthe purchase price of the Mortgaged Property (if a purchase);
31) the Appraisal date (if available) and the Appraisal value of the Mortgaged
Property;
32) the Mortgagor's and Co-Mortgagor's (if applicable) race;
33) the Mortgagor's and Co-Mortgagor's (if applicable) gender;
34) the Mortgagor's and Co-Mortgagor's (if applicable) date of birth (if
available);
35) the origination channel (wholesale, retail, or correspondent);
36) number of units;
37) as of date;
38) amortization term;
39) balloon flag;
40) prepayment penalty flag;
41) mortgage insurance provider, or code for LPMI;
42) mortgage insurance coverage percentage;
43) mortgage insurance cost;
44) mortgage insurance certificate number;
45) number of borrowers;
46) the monthly servicing fee;
47) The MIN number assigned to each Mortgage Loan, if applicable;
48) a code indicating the Appraisal Type (Tax Assessment, BPO, Drive-By Form
704, URAR, Form 2065, Form 2055 (Exterior only), Form 2055 (Interior
Inspection), or AVM 9 (if available);
49) if the Appraisal Type in #75 is an AVM, then a description of the AVM type
(if available);
50) a code indicating whether the Borrower(s) is self-employed (yes or no);
51) code indicating whether the loan is High Cost or Covered (HC, CV, HL);
52) a section 32 flag; and
53) the APR on the Mortgage Loan ( cannot guarantee accuracy of data). .
EXHIBIT G
ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
This is an Assignment, Assumption and Recognition Agreement (the
"Agreement") made this ______ day of __________, 2004, among (the "Assignor"),
________________ (the "Assignee") and CitiMortgage, Inc. ("Citicorp").
In consideration of the mutual promises contained herein the parties
hereto agree that the mortgage loans (the "Mortgage Loans") listed on Attachment
1 annexed hereto (the "Mortgage Loan Schedule") now serviced by Citicorp for
Assignor and its successors and assigns pursuant to the Mortgage Loan Purchase
and Servicing Agreement dated as of _____________, 2004, between Assignor and
Citicorp (the "Purchase and Servicing Agreement") shall be subject to the terms
of this Agreement. Capitalized terms used herein but not defined shall have the
meanings ascribed to them in the Purchase and Servicing Agreement.
Assignment and Assumption
1. Assignor hereby grants, transfers and assigns to Assignee all of
the right, title and interest of Assignor in the Mortgage Loans and, to the
extent of the Mortgage Loans, all of its right, title and interest in, to and
under the Purchase and Servicing Agreement.
Warranties
2. Assignor warrants and represents to, and covenants with, the
Assignee as of the date hereof that:
(a) Attached hereto as Attachment 2 is a true and accurate copy of
the Purchase and Servicing Agreement which agreement is in full force and effect
as of the date hereof and the provisions of which have not been waived, amended
or modified in any respect, nor has any notice of termination been given
thereunder;
(b) Assignor is the lawful owner of the Mortgage Loans with full
right to transfer the Mortgage Loans and any and all of its interests, rights
and obligations under the Purchase and Servicing Agreement to the extent of the
Mortgage Loans free and clear from any and all claims and encumbrances
whatsoever and upon the transfer of the Mortgage Loans to Assignee as
contemplated herein, Assignee shall have good title to each and every Mortgage
Loan, as well as any and all of Assignee's interests, rights and obligations
under the Purchase and Servicing Agreement to the extent of the Mortgage Loans,
free and clear of all liens, claims and encumbrances;
(c) There are no offsets, counterclaims or other defenses available
to Citicorp with respect to the Mortgage Loans or the Purchase and Servicing
Agreement;
(d) Assignor has no knowledge of, and has not received notice of, any
waivers under, or any modification of, the Mortgage Loans;
(e) Assignor is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation, and has all
requisite power and authority to acquire, own and sell the Mortgage Loans;
(f) Assignor has full corporate power and authority to execute,
deliver and perform its obligations under this Agreement, and to consummate the
transactions set forth herein. The consummation of the transactions contemplated
by this Agreement is in the ordinary course of Assignor's business and will not
conflict with, or result in a breach of, any of the terms, conditions or
provisions of Assignor's charter or by-laws or any legal restriction, or any
material agreement or instrument to which Assignor is now a party or by which it
is bound, or result in the violation of any law, rule, regulation, order,
judgment or decree to which Assignor or its property is subject. The execution,
delivery and performance by Assignor of this Agreement and the consummation by
it of the transactions contemplated hereby, have been duly authorized by all
necessary corporate action on part of Assignor. This Agreement has been duly
executed and delivered by Assignor and, upon the due authorization, execution
and delivery by Assignee, will constitute the valid and legally binding
obligation of Assignor enforceable against Assignor in accordance with its terms
except as enforceability may be limited by bankruptcy, reorganization,
insolvency, moratorium or other similar laws now or hereafter in effect relating
to creditors' rights generally, and by general principles of equity regardless
of whether enforceability is considered in a proceeding in equity or at law; and
(g) No consent, approval, order or authorization of, or declaration,
filing or registration with, any governmental entity is required to be obtained
or made by Assignor in connection with the execution, delivery or performance by
Assignor of this Agreement, or the consummation by it of the transactions
contemplated hereby.
3. Assignee warrants and represents to, and covenants with, Assignor
and Citicorp that as of the date hereof:
(a) The Assignee is a corporation duly organized, validly existing
and in good standing under the laws of the jurisdiction of its incorporation,
and has all requisite corporate power and authority to acquire, own and purchase
the Mortgage Loans;
(b) Assignee has full corporate power and authority to execute,
deliver and perform its obligations under this Agreement, and to consummate the
transactions set forth herein. The consummation of the transactions contemplated
by this Agreement is in the ordinary course of Assignee's business and will not
conflict with, or result in a breach of, any of the terms, conditions or
provisions of Assignee's charter or by-laws or any legal restriction, or any
material agreement or instrument to which Assignee is now a party or by which it
is bound, or result in the violation of any law, rule, regulation, order,
judgment or decree to which Assignee or its property is subject. The execution,
delivery and performance by Assignee of this Agreement and the consummation by
it of the transactions contemplated hereby, have been duly authorized by all
necessary corporate action on part of Assignee. This Agreement has been duly
executed and delivered by Assignee and, upon the due authorization, execution
and delivery by Assignor, will constitute the valid and legally binding
obligation of Assignee enforceable against Assignee in
accordance with its terms except as enforceability may be limited by bankruptcy,
reorganization, insolvency, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally, and by general principles of
equity regardless of whether enforceability is considered in a proceeding in
equity or at law;
(c) No consent, approval, order or authorization of, or declaration,
filing or registration with, any governmental entity is required to be obtained
or made by Assignee in connection with the execution, delivery or performance by
Assignee of this Agreement, or the consummation by it of the transactions
contemplated hereby; and
(d) Assignee agrees to be bound, as "Purchaser" (as such term is
defined under the Purchase and Servicing Agreement), by all of the terms,
covenants and conditions of the Purchase and Servicing Agreement and the
Mortgage Loans, and from and after the date hereof, the Assignee assumes for the
benefit of each of Assignor and Citicorp all of Assignor's obligations as
Purchaser thereunder.
Recognition of Assignee
4. From and after the date hereof, Citicorp shall recognize Assignee
as owner of the Mortgage Loans and will service the Mortgage Loans in accordance
with the Purchase and Servicing Agreement, as if Assignee and Citicorp had
entered into a separate purchase and servicing agreement for the servicing of
the Mortgage Loans in the form of the Purchase and Servicing Agreement, the
terms of which are incorporated herein by reference. It is the intention of
Assignor, Citicorp and Assignee that this Agreement will constitute a separate
and distinct servicing agreement, and the entire agreement, between Citicorp and
Assignee to the extent of the Mortgage Loans and shall be binding upon and for
the benefit of the respective successors and assigns of the parties hereto.
5. The Mortgage Loans shall be serviced by Citicorp for Assignee in
accordance with all applicable state, federal and local laws as well as in
conformity with the provisions of the applicable Mortgages and Mortgage Notes,
and pursuant to the terms and conditions of this Agreement.
Miscellaneous
6. All demands, notices and communications related to the Mortgage
Loans, the Purchase and Servicing Agreement and this Agreement shall be in
writing and shall be deemed to have been duly given if personally delivered at
or mailed by registered mail, postage prepaid, as follows:
(a) In the case of Seller,
CitiMortgage, Inc.
0000 Xxxxxxxxxx Xxxxx, XX 00,
X'Xxxxxx, Xxxxxxxx 00000
Attention: Capital Markets
with a copy to
Investor Reporting Department, MS 314
(b) In the case of Assignee
_______________________________
_______________________________
_______________________________
Attention:_____________________
(c) In the case of Assignor,
_______________________________
_______________________________
_______________________________
Attention:_____________________
7. This Agreement shall be construed in accordance with the laws of the
State of New York, except to the extent preempted by Federal law, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
8. No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced.
9. This Agreement shall inure to the benefit of the successors and
assigns of the parties hereto. Any entity into which the Assignor, Assignee or
Citicorp may be merged or consolidated shall, without the requirement for any
further writing, be deemed the Assignor, Assignee or Citicorp, respectively,
hereunder.
10. This Agreement shall survive the conveyance of the Mortgage Loans,
the assignment of the Purchase and Servicing Agreement to the extent of the
Mortgage Loans by the Assignor to the Assignee and the termination of the
Purchase and Servicing Agreement.
11. This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original, and all such
counterparts shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the
day and year first above written.
,
ASSIGNOR
By:_________________________
Name:_______________________
Title:______________________
,
ASSIGNEE
By:_________________________
Name:_______________________
Title:______________________
,
CITIMORTGAGE, INC.
By:_________________________
Name:_______________________
Title:______________________
ATTACHMENT 1
MORTGAGE LOAN SCHEDULE
[Intentionally Omitted]
ATTACHMENT 2
MORTGAGE LOAN PURCHASE AND SERVICING AGREEMENT
[Intentionally Omitted]
EXHIBIT H
MORTGAGE LOAN DOCUMENTS
1. The original Mortgage Note endorsed, "Pay to the order of ___________,
without recourse" and signed in the name of Seller by an authorized
officer. In the event that the Mortgage Loan was acquired by Seller in a
merger, the endorsement must be by "[Seller], successor by merger to [name
of predecessor]"; and in the event that the Mortgage Loan was acquired or
originated by Seller while doing business under another name, the
endorsement must be by "[Seller], formerly known as [previous name]".
2. The original Mortgage, or a copy of the Mortgage with evidence of
recording thereon certified by the appropriate recording office to be a
true copy of the recorded Mortgage, or, if the original Mortgage has not
yet been returned from the recording office, acopy of the original
Mortgage together with a certificate of either the closing attorney, an
officer of the title insurer which issued the related title insurance
policy or an officer of Seller, certifying that the copy is a true copy of
the original of the Mortgage which has been delivered by such officer or
attorney for recording in the appropriate recording office of the
jurisdiction in which the Mortgaged Property is located.
3. The original Assignment of Mortgage from Seller, prepared in blank,
which assignment shall be in form and substance acceptable for recording.
In the event that the Mortgage Loan was acquired by Seller in a merger,
the assignment must be by "[Seller], successor by merger to [name of
predecessor]"; and in the event that the Mortgage Loan was acquired or
originated by Seller while doing business under another name, the
assignment must be by "[Seller], formerly known as [previous name]".
4. The original policy of title insurance, or, if the policy has not yet
been issued acopy of the written commitment or interim binder issued by
the title insurance company, dated and certified as of the date the
Mortgage Loan was funded, with a statement by the title insurance company
or closing attorney on such binder or commitment that the priority of the
lien of the related Mortgage during the period between the date of the
funding of the related Mortgage Loan and the date of the related title
policy (which title policy shall be dated the date of recording of the
related Mortgage) is insured.
5. Originals, or certified true copies from the appropriate recording
office, of any intervening assignments of the Mortgage with evidence of
recording thereon, or, if the original intervening assignment has not yet
been returned from the recording office, a certified copy of such
assignment.
6. Originals or copies of all assumption and modification agreements, if
any.
7. Original power of attorney, if applicable.
8. The original of any guaramtee executed in connection with the Mortgage
Note, if applicable.
EXHIBIT I
FORM OF
OFFICER'S CERTIFICATE
I, ____________, hereby certify that I am a duly elected _____ Vice
President of CitiMortgage, Inc., a Delaware corporation (the "Seller"), and
further certify, on behalf of the Seller as follows:
1. Each person who, as an officer or attorney-in-fact of the Seller,
signed the Mortgage Loan Purchase and Servicing Agreement (the "Purchase
Agreement"), dated as of ____________, 2004, by and between the Seller and
________________________ (the "Purchaser") and any other document
delivered prior hereto or on the date hereof in connection with the sale
and servicing of the Mortgage Loans in accordance with the Purchase
Agreement was, at the respective times of such signing and delivery, and
is as of the date hereof, duly elected or appointed, qualified and acting
as such officer or attorney-in-fact, and the signatures of such persons
appearing on such documents are their genuine signatures.
2. All of the representations and warranties of the Seller contained in
Section 6.02 of the Purchase Agreement were true and correct in all
material respects as of the date of the Purchase Agreement and are true
and correct in all material respects as of the date hereof.
3. The Seller has performed all of its duties and has satisfied all the
material conditions on its part to be performed or satisfied prior to the
Closing Date pursuant to the Purchase Agreement.
All capitalized terms used herein and not otherwise defined shall have the
meaning assigned to them in the Purchase Agreement.
IN WITNESS WHEREOF, I have hereunto signed my name and affixed the seal of
the Seller.
Dated:___________, 2004
[Seal]
CITIMORTGAGE, INC.
By:_________________________________________
Name:_______________________________________
Title:______________________________________
I, ____________, Assistant Secretary of the Seller, hereby certify that
___________ is a duly elected, qualified and acting _____ Vice President of the
Seller and that the signature appearing above is his genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name.
Dated:___________, 2004
[Seal]
CITIMORTGAGE, INC.
By:_________________________________________
Name:_______________________________________
Title:______________________________________
Exhibit J
Reporting Method - 80 byte format Scheduled/Scheduled Portfolios
(similar to FNMA Laser Format)
--------------------------------------------------------------------------------
NM Description Extended Description
Length -----------
F1 Activity Reporting Period Calc - Reporting Month mmccyy
6
F2 Pool ID 8 spaces
8
F3 FNMA Loan Number Xxx Xxxx #
00
F4 Servicer Loan Number Xxxx Xxxx #
00
X0 Xxxxxxx Xxxxxxxx Interest Rate Note Rate
8V5
F6 Pass Thru Rate Inv Rate
8V5
F7 Guaranty Fee Rate Zero Fill (00.00000)
8V5
F8 Excess Yield Rate Zero Fill (00.00000)
8V5
F9 Servicing Fee Rate Schd S/F Rt
8V5
F10 Total Scheduled Payment Schd Pymt
15V2
F11 Principal Portion of Schd Pymt Schd Prin-B
12V2
F12 Actual Principal Pymt Applied TR-Prin Shr only
12V2
F13 Last Paid Installment Date LPI Date
8
F14 Number of Days Delinquent Calc - Using F1 & F13
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
3
(30,60,90,120,150,180 ect.) Ex LPI Date is 6/1/98 &
Reporting Period is 7/30/98 loan would be coded as
"30"
F15 Payment Day 8 spaces
8
F16 Net Int Portion of Schd Pymt Int Remit
12V2
F17 Negative Amortization Amt Zero Fill (0000000.00)
12V2
F18 Unscheduled Principal Amt Calc - Princ Remit - F11
15V2
F19 Unscheduled Principal Date Date removed or
8
TR Date for last Xxxx made
F20 Ending Schd Principal Bal End Sec Bal
15V2
F21 Ending Actual Principal Bal Prin Bal Shr
15V2
F22 Nature of Unschd Prin Code If Reason for Removal is
Foreclosure 2 w/cash or w/ocash = 06. If Reason for
Removal is Short Payoff = 43. If Reason for Removal is Payoff = 03.
If Reason for Removal is Service Release = 04. If there is not a
liquidation in the field and field F19 has a date then the code would
be 02.
F23 Other Income Amount Zero Fill (0000000.00)
12V2
F24 Other Income Flag Zero Fill (00)
2
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
X00 Xxxxx Maintenance Zero Fill (00.00000)
8V5
F26 Note Rate Conversion Statue Zero Fill(0)
1
F27 Loan Modification Date 8 spaces
8
F28 Revised Maturity Date at Ext 8 spaces
8
F29 Delinquency Status Code F/C = 01, BK = 02 & REO = 03
2
F30 Foreclosure Sale Date
8
F31 Appraised Value
15V2
FL32 Amt of Realized Loss Total Loss
12V2
FL33 Realized Loss Due Zero Fill (0000000.00)
12V2
FL34 Realized Loss Due Zero Fill (0000000.00)
12V2
FL35 Realized Loss Due Zero Fill (0000000.00)
12V2
FL36 Realized Loss Due Zero Fill (0000000.00)
12V2
FL37 Realized Loss Due Zero Fill (0000000.00)
12V2
FL38 Servicer Recomp Zero Fill (0000000.00)
12V2
FL39 Servicer Recomp Zero Fill (0000000.00)
12V2
FL40 Servicer Recomp Zero Fill (0000000.00)
12V2
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
FL41 Non Capitalized Deferred Int Zero Fill (0000000.00)
12V2
--------------------------------------------------------------------------------
FL42 Extraordinary Trust Fund Zero Fill (0000000.00)
12V2
FL43 Int Paid on Delinq Servicing Zero Fill (0000000.00)
12V2
FR44 Liquidation Proceeds Window will appear if any loans
with 12V2
FL32 is > 0.00 &
F22 = 03. Update Transmission from
net proceeds from Cliffs Report.
FR45 Net Ins Proceeds Zero Fill (0000000.00)
12V2
FR46 Liquidation Expenses Zero Fill (0000000.00)
12V2
FT47 Net Revenues on REO Zero Fill (0000000.00)
12V2
FT48 Tax Expenses on REO Zero Fill (0000000.00)
12V2
FT49 Repair Expenses on REO Zero Fill (0000000.00)
12V2
FT50 Selling Expenses on REO Zero Fill (0000000.00)
12V2
FT51 Other Non-capitalized Expenses on REO Zero Fill (0000000.00)
12V2
FT52 Other Capitalized Expenses on REO Zero Fill (0000000.00)
12V2
--------------------------------------------------------------------------------
EXHIBIT K
WHOLE LOAN/PASS-THROUGH TRANSFER INFORMATION
Purchaser shall provide to Seller the following information with respect to each
Mortgage Loan that is to be included in a Whole Loan, Agency Transfer or
Pass-Through Transfer:
CMI Loan Number
Investor Loan Number
Mortgagors Last Name
P&I Payment
Pass thru Rate
Servicing Fee
Ending Scheduled Balance
Unpaid Principal Balance
Paid to Date
Investor Number
Block
EXHIBIT L
ASSIGNMENT AND CONVEYANCE
On this [__] day of [___], 200[_], CitiMortgage, Inc., as the
Seller, under that certain Flow Mortgage Loan Purchaser and Servicing Agreement,
dated as of May 1, 2004 (the "Agreement") does hereby sell, transfer, assign,
set over and convey to Xxxxxx Brothers Bank, FSB, as Purchaser under the
Agreement all rights, title and interest of the Seller in and to the Mortgage
Loans listed on the Mortgage Loan Schedule attached hereto as Exhibit 1,
together with the related Mortgage Files and all rights and obligations arising
under the documents contained therein. Pursuant to Section 5 of the Agreement,
the Seller has delivered to the Custodian the documents for each Mortgage Loan
to be purchased as set forth in the Agreement. The ownership of each Mortgage
Note, Mortgage, and the contents of each Mortgage File is vested in the
Purchaser and the ownership of all records and documents with respect to the
related Mortgage Loan prepared by or which come into the possession of the
Seller shall immediately vest in the Purchaser and shall be delivered promptly
by the Seller to the Purchaser.
The Seller confirms to the Purchaser that the representations and
warranties set forth in Section 6.01 of the Agreement with respect to the
Mortgage Loans listed on the Mortgage Loan Schedule attached hereto as Exhibit
1, and the representations and warranties in Section 6.02 of the Agreement with
respect to the Seller are true and correct as of the date hereof.
The Mortgage Loans listed on the Mortgage Loan Schedule attached
hereto have the pool characteristics as set forth on Exhibit 2 attached hereto.
Capitalized terms used herein and not otherwise defined shall have
the meanings set forth in the Agreement.
CITIMORTGAGE, INC.
(Seller)
By: ________________________________________
Name:__________________________
Title:_________________________
XXXXXX BROTHERS BANK, FSB
(Purchaser)
By:_______________________
Name:______________________
Title:_____________________
EXHIBIT M
CitiMortgage, Inc.
0000 Xxxxxxxxxx Xxxxx
Xxxx Xxxxxxx 000
X'Xxxxxx, XX 00000-0000 March____, 2005
CITIMORTGAGE, INC
XXXXXXXX-XXXXX
CERTIFICATION
1. I have reviewed the information required to be delivered to the Owner and
the Master Servicer pursuant to the Agreement (the "Servicing
Information").
2. Based on my knowledge, the Servicing Information has been provided to the
Master Servicer when and as required under the Agreement.
3. Based on my knowledge, the Servicing Information does not contain any
material untrue information or omit to state information necessary to make
the Servicing Information, in light of the circumstances under which such
information was provided, not misleading as of the date of this
certification;
4. I am responsible for reviewing the activities performed by the Servicer
under the Agreement, and based upon my knowledge and the review required
under the Agreement, and except as disclosed in writing to you on or prior
to the date of this certification either in the accountants' report
required under the Agreement or in disclosure a copy of which is attached
hereto, the Servicer has, as of the date of this certification, fulfilled
its obligations under the Agreement.
CitiMortgage, Inc.
____________________________
Xxxxx X. XxXxxxxx
Senior Vice President
EXHIBIT N
REO ACCOUNT CERTIFICATION
(date)
Citibank (West), FSB hereby certifies that it has established the
non-interest bearing account described below as an REO Account pursuant to
Section 10.17 of Mortgage Loan Purchase and Servicing Agreement, dated as of
___________ 1, 2004, Fixed Rate Mortgage Loans.
Title of Account: "CitiMortgage, Inc. in trust for Purchaser -
Fixed Rate Mortgage Loans, as tenants in common"
Account Number: __________________________
Address of office or
branch of Citibank
(West), FSB
at which Account is
maintained: __________________________
__________________________
Citibank (West), FSB
By __________________________
EXHIBIT O
REO ACCOUNT LETTER AGREEMENT
(date)
To: _____________________________________
_____________________________________
_____________________________________
(the "Depository")
As "Seller" under Mortgage Loan Purchase and Servicing Agreement, dated as
of ___________ 1, 2004, Fixed Rate Mortgage Loans (the "Agreement"), we hereby
authorize and request you to establish a non-interest bearing account, as an REO
Account pursuant to Section 10.17 of the Agreement, to be designated as
"[Seller], in trust for Purchaser - Fixed Rate Mortgage Loans, as tenants in
common." All deposits in the account shall be subject to withdrawal therefrom by
order signed by Seller. This letter is submitted to you in duplicate. Please
execute and return one original to us.
CitiMortgage, Inc.
By_______________________
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.
_______________________
(name of Depository)
By_____________________
