RWT HOLDINGS, INC. Owner MORGAN STANLEY CREDIT CORPORATION Servicer and REDWOOD TRUST, INC. Guarantor MASTER SERVICING AGREEMENT Dated as of November 1, 2006 Fixed, Adjustable Rate and Additional Collateral Mortgage Loans Flow Delivery Program
Exhibit
10.5
RWT
HOLDINGS, INC.
Owner
XXXXXX
XXXXXXX CREDIT CORPORATION
Servicer
and
REDWOOD
TRUST, INC.
Guarantor
___________________________
Dated
as of November 1, 2006
Fixed,
Adjustable Rate and Additional Collateral Mortgage Loans
Flow
Delivery Program
TABLE
OF CONTENTS
Page
|
ARTICLE
I DEFINITIONS
|
1
|
|
Section
1.01 Defined
Terms.
|
1
|
|
ARTICLE
II BOOKS
AND RECORDS; TRANSFER OF MORTGAGE LOANS
|
6
|
|
Section
2.01 Books
and Records.
|
6
|
|
Section
2.02 Transfer
of Mortgage Loans.
|
6
|
|
ARTICLE
III REPRESENTATIONS
AND WARRANTIES OF THE SERVICER
|
6
|
|
Section
3.01 Representations
and Warranties of the Servicer.
|
6
|
|
ARTICLE
IV ADMINISTRATION
AND SERVICING OF MORTGAGE LOANS
|
8
|
|
Section
4.01 Role
of the Servicer.
|
8
|
|
Section
4.02 Collection
of Mortgage Loan Payments.
|
9
|
|
Section
4.03 Realization
Upon Defaulted Mortgage Loans.
|
10
|
|
Section
4.04 Establishment
of Custodial Accounts; Deposits in Custodial Accounts.
|
10
|
|
Section
4.05 Permitted
Withdrawals From the Custodial Account.
|
11
|
|
Section
4.06 Establishment
of Escrow Accounts; Deposits in Escrow Accounts.
|
12
|
|
Section
4.07 Permitted
Withdrawals From Escrow Account.
|
13
|
|
Section
4.08 Transfer
of Accounts.
|
13
|
|
Section
4.09 [INTENTIONALLY
OMITTED]
|
13
|
|
Section
4.10 Errors
and Omissions Insurance.
|
13
|
|
Section
4.11 Title
Management and Disposition of REO Property.
|
14
|
|
Section
4.12 Adjustments
to Mortgage Interest Rates.
|
15
|
|
Section
4.13 Subservicing
Agreements Between the Servicer and Subservicers.
|
15
|
|
Section
4.14 Successor
Subservicers.
|
16
|
|
Section
4.15 Liability
of the Servicer.
|
16
|
|
Section
4.16 Assumption
or Termination of Subservicing Agreements.
|
16
|
|
Section
4.17 Servicing
Accounts.
|
17
|
|
Section
4.18 Permitted
Investments.
|
17
|
|
Section
4.19 Payment
of Taxes, Insurance and Other Charges; Maintenance of Primary Mortgage
Insurance Policies; Collections Thereunder.
|
17
|
|
Section
4.20 Maintenance
of Hazard Insurance.
|
18
|
|
ARTICLE
V ADMINISTRATION
AND SERVICING OF TRADING ACCOUNTS
|
19
|
|
Section
5.01 The
Servicer to Service Trading Accounts.
|
19
|
|
Section
5.02 Agreements
with Respect to the Surety Bond.
|
20
|
|
ARTICLE
VI PAYMENTS
TO OWNER
|
21
|
|
Section
6.01 Distributions.
|
21
|
|
Section
6.02 Statements
to Owner.
|
21
|
|
Section
6.03 Monthly
Advances by the Servicer.
|
21
|
|
Section
6.04 Compensating
Interest.
|
22
|
i
|
ARTICLE
VII GENERAL
SERVICING PROCEDURE
|
23
|
|
Section
7.01 Assumption
Agreements.
|
23
|
|
Section
7.02 Satisfaction
of Mortgages and Release of Mortgage Files.
|
23
|
|
Section
7.03 Servicing
Compensation.
|
23
|
|
Section
7.04 Annual
Statement as to Compliance and Attestation.
|
24
|
|
Section
7.05 Owner’s
Right to Examine the Servicer Records .
|
24
|
|
ARTICLE
VIII REPORTS
TO BE PREPARED BY SERVICER
|
25
|
|
Section
8.01 The
Servicer Shall Provide Information as Reasonably Required
.
|
25
|
|
ARTICLE
IX THE
SERVICER
|
25
|
|
Section
9.01 Indemnification;
Third Party Claims.
|
25
|
|
Section
9.02 Merger
or Consolidation of the Servicer .
|
26
|
|
Section
9.03 Limitation
on Liability of the Servicer and Others.
|
26
|
|
Section
9.04 The
Servicer Not to Resign.
|
26
|
|
ARTICLE
X DEFAULT
|
27
|
|
Section
10.01 Events
of Default .
|
27
|
|
Section
10.02 Waiver
of Defaults .
|
28
|
|
ARTICLE
XI TERMINATION;
XXXXXXXXXX
|
00
|
|
Section
11.01 Termination
.
|
28
|
|
Section
11.02 Repurchase.
|
28
|
|
ARTICLE
XII MISCELLANEOUS
PROVISIONS
|
29
|
|
Section
12.01 Successor
to the Servicer.
|
29
|
|
Section
12.02 Amendment.
|
30
|
|
Section
12.03 Assignments.
|
30
|
|
Section
12.04 Assignment
of Servicing Rights .
|
30
|
|
Section
12.05 Governing
Law.
|
30
|
|
Section
12.06 Notices.
|
30
|
|
Section
12.07 Severability
Provisions.
|
31
|
|
Section
12.08 Exhibits.
|
31
|
|
Section
12.09 General
Interpretive Principles.
|
31
|
|
Section
12.10 Reproduction
of Documents .
|
32
|
|
Section
12.11 Successors
and Assigns.
|
32
|
|
Section
12.12 Counterparts.
|
32
|
|
Section
12.13 Non-Solicitation
.
|
32
|
|
Section
12.14 Guaranty
of Owner’s Obligations.
|
33
|
|
ARTICLE
XIII COMPLIANCE
WITH REGULATION AB
|
33
|
|
Section
13.01 Intent
of the Parties; Reasonableness.
|
33
|
|
Section
13.02 Additional
Representations and Warranties of the Servicer.
|
33
|
|
Section
13.03 Information
to Be Provided by the Servicer.
|
34
|
|
Section
13.04 Annual
Statements as to Compliance.
|
37
|
|
Section
13.05 Report
on Assessment of Compliance and Attestation.
|
38
|
|
Section
13.06 Use
of Subservicers and Subcontractors.
|
39
|
|
Section
13.07 Indemnification;
Remedies.
|
40
|
|
Section
13.08 Third
Party Beneficiary.
|
42
|
ii
EXHIBIT
A
FORM
OF
LIMITED POWER OF ATTORNEY
EXHIBIT
B
FORM
OF
MONTHLY SERVICER REPORT
EXHIBIT
C
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
EXHIBIT
D
FORM
OF
ANNUAL CERTIFICATION
iii
MORTGAGE
LOAN SERVICING AGREEMENT
This
is a
MASTER SERVICING AGREEMENT (this “AGREEMENT”), dated and effective as of
November 1, 2006 and is by and between RWT Holdings, Inc., a Delaware
Corporation, as owner (“Owner”), Xxxxxx Xxxxxxx Credit Corporation, a Delaware
corporation, as servicer (the “Servicer”), and Redwood Trust, Inc., a Maryland
corporation, as guarantor (“Guarantor”).
PRELIMINARY
STATEMENTS
Pursuant
to a Master Mortgage Loan Purchase Agreement dated as of November 1, 2006
between Owner, Xxxxxx Xxxxxxx Credit Corporation, a Delaware corporation
(“Seller”) and Guarantor (as amended, modified restated or supplemented from
time to time, the “Purchase Agreement”), Owner may purchase from Seller from
time to time certain residential, first mortgage loans. In order to facilitate
the servicing of such mortgage loans by the Servicer, the Servicer, Owner and
Guarantor have executed this agreement.
In
consideration of the premises and the mutual agreements hereinafter set forth,
Owner and the Servicer agree as follows:
ARTICLE
I
DEFINITIONS
Section
1.01 Defined
Terms.
Whenever
used in this Agreement, the following words and phrases, unless the context
otherwise requires shall have the following meaning specified in this Section
(capitalized terms used and not otherwise defined herein shall have the
respective meanings specified in the Purchase Agreement to the extent the same
are defined therein):
“Agreement”:
This Master Servicing Agreement and all exhibits hereto, as the same may from
time to time be amended, modified, restated or supplemented.
“Applicable
Law”: All applicable laws of any Governmental Authority, including, without
limitation, federal, state and foreign securities laws, tax laws, tariff and
trade laws, ordinances, judgments, decrees, injunctions, writs and orders or
like actions of any Governmental Authority and rules, regulations, orders,
interpretations, licenses, and permits of any federal, regional, state, county,
municipal or other Governmental Authority.
“Collateral
Base”: With respect to any Mortgage Loan, the value of any Additional Collateral
related to such Mortgage Loan, plus the value of the Mortgaged Property related
to such Mortgage Loan.
“Condemnation
Proceeds”: All awards or settlements in respect of a taking of a partial or an
entire Mortgaged Property by exercise of the power of eminent domain or
condemnation.
“Custodial
Account”: The separate trust account or accounts created and maintained pursuant
to Section
4.04
of this
Agreement which shall be entitled “Xxxxxx Xxxxxxx Credit Corporation, in trust
for RWT Holdings, Inc.,” or such other title as is requested by the
Owner.
“Eligible
Account”: An account that is (i) maintained at a depository institution the
short-term debt obligations (or, in the case of a depository institution which
is part of a holding company structure, the short-term debt obligations of
such
parent holding company) of which have been rated by each Rating Agency in one
of
its two highest short-term rating categories at the time of the deposit therein,
or (ii) a trust account maintained with a corporate trust department of a
federal or state chartered depository institution or trust company, which
institution is acting in its fiduciary capacity.
“Escrow
Account”: The separate trust account or accounts created and maintained pursuant
to Section
4.06
on which
shall be entitled “Xxxxxx Xxxxxxx Credit Corporation, as Servicer, in trust for
Owner and various Mortgagors,” or such other title as is requested by
Owner.
“Escrow
Payments”: The amounts constituting ground rents, taxes, assessments, water
charges, sewer rents, mortgage insurance premiums, property 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
10.01.
“Governmental
Authority”: Any nation or government (including any state or other political
subdivision of either thereof) and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to
government.
“Insurance
Proceeds”: Proceeds of any Primary Mortgage Insurance Policy, title policy,
hazard policy or other insurance policy covering a Mortgage Loan, if any, to
the
extent such proceeds are not to be applied to the restoration of the related
Mortgaged Property or released to the Mortgagor in accordance with the
procedures that the Servicer would follow in servicing mortgage loans held
for
its own account.
“Liquidation
Proceeds”: Amounts, other than Insurance Proceeds and Condemnation Proceeds,
received by the Servicer in connection with the liquidation of a defaulted
Mortgage Loan through a trustee’s sale, foreclosure sale or otherwise
(including, but not limited to, amounts received with respect to an Additional
Collateral Pledge Agreement), other than amounts received following the
acquisition of REO Property pursuant to Section
4.11.
“Loan
Amount”: With respect to any Mortgage Loan at any time, the outstanding
principal balance of such Mortgage Loan at such time.
“Loan
Documents”: With respect to any Mortgage Loan, the Mortgage Note, Mortgage,
and/or any other documents executed by Mortgagor and delivered to the Servicer
evidencing or securing the Mortgage Loan.
2
“Master
Servicer”: With respect to any Securitization Transaction, the “Master
Servicer,” if any, identified in the related transaction documents.
“Monthly
Advance”: The aggregate of the advances made by the Servicer on any Remittance
Date pursuant to Section
6.03.
“Moody’s”:
Xxxxx’x Investors Service, Inc. or its successor in interest.
“Mortgage
Loan”: The “Mortgage Loans” (as defined in the Purchase Agreement) which are
subject to this Agreement from time to time.
“MSA
Mortgage Loan Schedule”: Collectively, a schedule comprised of all Mortgage
Loans subject to servicing under this Agreement, but excluding all Mortgage
Loans assumed or transferred by Owner, or otherwise no longer subject to
servicing under this Agreement.
“MSCC”:
As defined in Section 4.16.
“Officer’s
Certificate”: A certificate signed by the Chairman of the Board, the Vice
Chairman of the Board, the President, a Senior Vice President, Vice President,
or an Assistant Vice President of the Servicer, and delivered to Owner as
required by this Agreement.
“Owner”:
The owner of the Mortgage Loans.
“Permitted
Investment”: Any one or more of the following:
|
(i)
|
direct
obligations of, or obligations fully guaranteed as to principal and
interest by, the United States or any agency or instrumentality thereof,
provided such obligations are backed by the full faith and credit
of the
United States;
|
|
(ii)
|
repurchase
obligations (the collateral for which is held by a third party) with
respect to any security described in clause (i) above, provided that
the
long-term unsecured obligations of the party agreeing to repurchase
such
obligations are at the time rated by each of the Rating Agencies
in one of
its two highest rating categories;
|
|
(iii)
|
certificates
of deposit, time deposits, demand deposits and bankers’ acceptances of any
bank or trust company incorporated under the laws of the United States
or
any state thereof or the District of Columbia, provided that the
short-term commercial paper of such bank or trust company at the
date of
acquisition thereof has been rated by each of the Rating Agencies
in its
highest rating;
|
|
(iv)
|
money
market funds rated by each of the Rating Agencies in its highest
short-term debt rating category;
|
|
(v)
|
commercial
paper (having original maturities of not more than 365 days) of any
corporation incorporated under the laws of the United States or any
state
thereof or the District of Columbia which on the date of acquisition
has
been rated by each of the Rating Agencies in its highest short-term
rating
category; and
|
3
|
(vi)
|
any
other obligation or security acceptable to each of the Rating Agencies
(as
certified by a letter from each of the Rating Agencies to Owner)
in
respect of mortgage pass through certificates rated in one of its
two
highest rating categories;
|
provided,
that with the exception of U.S. Treasury Strips, no such instrument shall be
a
Permitted Investment if such instrument evidences either (a) the right to
receive interest only payments with respect to the obligations underlying such
instrument or (b) both principal and interest payments derived from obligations
underlying such instrument where the principal and interest payments with
respect to such instruments provide a yield to maturity exceeding 120% of the
yield to maturity at par of such underlying obligation.
“Prepayment
Interest Shortfall”: With respect to any Remittance Date and any Mortgage Loan
that was the subject of a principal prepayment during the related Principal
Prepayment Period, an amount equal to one month’s interest at the Mortgage Loan
Remittance Rate on the amount of such principal prepayment less the amount
of
interest (adjusted to the Mortgage Loan Remittance Rate) paid by the Mortgagor
in respect of such principal prepayment.
“Principal
Prepayment Period”: As to any Remittance Date, the calendar month preceding the
month of distribution.
“Rating
Agency”: Either of Standard & Poor’s and Moody’s.
“Record
Date”: The close of business of the last Business Day of the month preceding the
month of the related Remittance Date.
“REMIC”:
A real estate mortgage investment conduit, as such term is defined by the
Internal Revenue Code of 1986, as amended.
“Remittance
Date”: The 18th day of any month or, if such 18th day is not a Business Day, the
first Business Day immediately preceding such 18th day.
“REO
Disposition”: The final sale by the Owner of any REO Property.
“REO
Property”: A Mortgaged Property acquired by the Servicer on behalf of Owner as
described in Section
4.11.
“Servicing
Advances”: All customary, reasonable and necessary “out of pocket” costs and
expenses incurred in the performance by the Servicer of its servicing
obligations, including, but not limited to, the cost of (i) the preservation,
restoration and protection of the Mortgaged Property, (ii) paying taxes and
insurance with respect to the Mortgaged Property, (iii) enforcement of judicial
proceedings, including foreclosures, bankruptcies and defense of claims relating
to the Mortgages and Mortgaged Property, and (iv) the management and liquidation
of the REO Property.
“Servicing
Criteria”: The “servicing criteria” set forth in Item 1122(d) of Regulation AB,
as such may be amended from time to time.
4
“Servicing
Fee”: With respect to any Mortgage Loan and any Remittance Date, the fee payable
monthly to the Servicer pursuant to Section
7.03.
“Servicing
Officer”: Any officer of the Servicer 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 Servicer to Owner upon request, as such
list may from time to time be amended.
“Specially
Serviced Mortgage Loan”: A Mortgage Loan as to which the following events have
occurred and is continuing (i) monthly mortgage payment being more that 60
days
delinquent (ii) any filing of insolvency proceeding on behalf of the related
Mortgagor or (iii) any receipt by the Servicer of notice of foreclosure of
the
related mortgage property.
“Standard
& Poor’s”: Standard & Poor’s Ratings Services, a division of the
XxXxxx-Xxxx Companies, Inc., or its successor in interest.
“Subcontractor”:
Any vendor, subcontractor or other Person that is not responsible for the
overall servicing (as “servicing” is commonly understood by participants in the
mortgage-backed securities market) of Mortgage Loans but performs one or more
discrete functions identified in Item 1122(d) of Regulation AB with
respect to Mortgage Loans under the direction or authority of the Seller or
a
Subservicer.
“Subservicer”:
Any Person that services Mortgage Loans on behalf of the Seller or any
Subservicer and is responsible for the performance (whether directly or through
Subservicers or Subcontractors) of a substantial portion of the material
servicing functions required to be performed by the Seller under this Agreement
or any Reconstitution Agreement that are identified in Item 1122(d) of
Regulation AB.
“Subservicing
Account”: An account established by a Subservicer which meets the requirements
set forth in Section
4.17
and is
otherwise acceptable to the Servicer, and which must be an Eligible
Account.
“Subservicing
Agreement”: The written agreement between the Servicer and a Subservicer
relating to the servicing and administration of the Mortgage Loans as provided
in Section
4.13.
“Surety
Agreement”: The Surety Bond Reimbursement Agreement dated March 17, 1999 between
the Surety Bond Issuer and the Servicer pursuant to which the Surety Bond Issuer
has issued the Surety Bond, as the same may be amended, modified, restated
or
supplemented from time to time.
“Surety
Bond”: The limited purpose Surety Bond, dated March 17, 1999, issued by the
Surety Bond Issuer in favor of the Sellers, as the same may be amended,
modified, restated or supplemented from time to time.
“Surety
Bond Issuer”: shall mean AMBAC Assurance Corp or its successors.
5
ARTICLE
II
BOOKS
AND RECORDS; TRANSFER OF MORTGAGE LOANS
Section
2.01 Books
and Records.
The
Servicer shall be responsible for maintaining, and shall maintain, a complete
set of books and records for the Mortgage Loans, which shall be appropriately
identified in the Servicer’s books and records to clearly reflect the ownership
of the Mortgage Loans by Owner, and subsequent assignments and transfers of
the
Mortgage Loans pursuant to Section
2.02
hereof.
At the request of Owner, the Servicer shall promptly deliver to Owner an MSA
Mortgage Loan Schedule setting forth all Mortgage Loans that the Servicer then
services and administers for Owner under this Agreement; provided, however,
that
the information contained on such MSA Mortgage Loan Schedule may be as of the
Closing Date for each respective Mortgage Loan and may consist of the Mortgage
Loan Schedule(s) attached to the Xxxx(s) of Sale for such Mortgage Loans, with
manual deletions or additions thereto or other revisions thereof.
Section
2.02 Transfer
of Mortgage Loans.
Owner
may, with the consent of the Servicer (which shall not be unreasonably
withheld), assign, sell or transfer (each, a “Transfer”) any of Owner’s interest
in and to any of the Mortgage Loans to any institutional investor that has
a net
worth of not less than $50,000,000 and owns not less than $250,000,000 in
residential mortgage loans (each, a “Permitted Transferee”), subject in each
case to the rights of the Servicer under the provisions of this Agreement
(including, without limitation, the right of the Servicer to continue servicing
such Mortgage Loans on the terms set forth herein), except that no such
assignment, sale, transfer, pledge, hypothecation or encumbrance shall increase
the Servicer’s liabilities or obligations or decrease the Servicer’s rights
under this Agreement, and Owner shall remain fully liable for performance of
all
of its obligations as to the transferred Mortgage Loans. As a condition
precedent to any Transfer (in addition to the other conditions set forth
herein), the Permitted Transferee shall enter into a servicing agreement with
the Servicer in the form of this Agreement, but mutatis mutandis, and deliver
such certificates and opinions as the Servicer may reasonably require. Upon
consummation of any Transfer, the MSA Mortgage Loan Schedule shall be amended
by
the Servicer to reflect such transfer. Notwithstanding the foregoing, Owner
shall not make any Transfer of (i) less than forty (40) Mortgage Loans, (ii)
Mortgage Loans with an aggregate unpaid principal balance less than $5,000,000
to any Person or if the remaining Mortgage Loans listed on the MSA Mortgage
Loan
Schedule after giving effect thereto would have an aggregate unpaid principal
balance less than $5,000,000 or (iii) any Mortgage Loans other than to a
Permitted Transferee in a transaction that complies with the terms of this
Agreement.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES OF THE SERVICER
Section
3.01 Representations
and Warranties of the Servicer.
6
The
Servicer represents, warrants and covenants to Owner, as of the date of this
Agreement and as of each Closing Date or as of such other date specified below,
that:
(i) The
Servicer (a) is a corporation, duly incorporated, validly existing and in good
standing under the laws of the State of Delaware, (b) has all licenses necessary
to carry on its business as now being conducted, (c) has all material licenses
and is qualified and in good standing under the laws of each state where a
Mortgaged Property is located to the extent required under applicable law to
effect such qualification, and (d) is in compliance with the laws of each such
state to the extent necessary to permit the enforcement of Owner’s rights
(either directly or through a Subservicer) under each Mortgage Loan and to
permit the servicing of the Mortgage Loans in accordance with the terms of
this
Agreement.
(ii) The
Servicer has full power and authority to hold each Mortgage Loan, to service
each Mortgage Loan, to execute and deliver this Agreement, and to enter into
and
consummate all transactions contemplated by this Agreement. The Servicer has
duly authorized the execution, delivery and performance of this Agreement,
has
duly executed and delivered this Agreement, and this Agreement, assuming due
authorization, execution and delivery by Owner and the enforceability against
Owner, constitutes a legal, valid and binding obligation of the Servicer,
enforceable against it in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency, liquidation,
moratorium, reorganization or other similar laws affecting the rights of
creditors generally or by general principles of equity, regardless of whether
enforcement is sought in a proceeding in equity or at law.
(iii) The
consummation of the transactions contemplated by this Agreement is in the
ordinary course of the Servicer’s business and will not conflict with or result
in a breach of any of the terms, conditions or provisions of the Servicer’s
certificate of incorporation or by-laws or any legal restriction or any material
agreement or instrument to which the Servicer is now party or by which it is
bound, or constitute a material default or result in an acceleration under
any
of the foregoing, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Servicer or its property is
subject.
(iv) The
Servicer is an approved seller/servicer for Xxxxxx Xxx or Xxxxxxx Mac in good
standing and is a mortgagee approved by the Secretary of Housing and Urban
Development pursuant to Section
203
of the
National Housing Act. No event has occurred that would render the Servicer
unable to comply with Xxxxxx Mae or Xxxxxxx Mac eligibility requirements or
that
would require notification to either Xxxxxx Mae or Xxxxxxx Mac.
(v) The
Servicer has no reason or cause to believe that it cannot perform each covenant
contained in this Agreement.
(vi) There
is
no action suit, proceeding or investigation pending or, to the Servicer’s
knowledge, threatened, against the Servicer that, in the Servicer’s judgment, if
determined adversely to the Servicer, would materially and adversely affect
the
validity or enforceability of this Agreement or the ability of the Servicer
to
perform its obligations hereunder in accordance with the terms
hereof.
7
(vii) No
consent, approval, authorization or order of any court or governmental authority
is required for the execution and delivery of this Agreement by the Servicer
or
for the performance by the Servicer of its obligations hereunder, other than
any
such consent, approval, authorization or order as has been obtained prior to
the
Closing Date.
The
Servicer shall indemnify Owner and hold it harmless against any losses, damages,
penalties, fines, forfeitures, 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 the Servicer’s
representations and warranties contained in this Section
3.01.
It is
understood and agreed that the obligations of the Servicer set forth in this
Section
3.01
to
indemnify Owner as provided above constitute the sole remedies of Owner
respecting a breach of the foregoing representations and
warranties.
ARTICLE
IV
ADMINISTRATION
AND SERVICING OF MORTGAGE LOANS
Section
4.01 Role
of the Servicer.
The
Servicer, as independent contract servicer, shall service and administer the
Mortgage Loans in accordance with this Agreement and the normal and usual
standards of practice of prudent mortgage lenders, and shall have full power
and
authority, acting alone, to do or cause to be done any and all things in
connection with such servicing and administration that the Servicer may deem
necessary or desirable and consistent with the terms of this
Agreement.
Consistent
with the terms of this Agreement, at the respective Mortgagor’s request or as
required by applicable law, the Servicer may waive, modify or vary any term
of
any Mortgage Loan or consent to the postponement of strict compliance with
any
such term or in any manner grant indulgence to any Mortgagor if, in the
Servicer’s reasonable and prudent determination, such waiver, modification,
postponement or indulgence is consistent with industry practice and not
materially adverse to Owner, including actions intended to maximize collections
on such Mortgage Loan; provided, however, that, except as permitted by the
following paragraph, the Servicer shall not permit any modification with respect
to any Mortgage Loan that would change the Mortgage Interest Rate, forgive
the
payment of any principal or interest payments, make future advances or extend
the final maturity date on such Mortgage Loan. Without limiting the generality
of the foregoing, the Servicer shall continue, and is hereby authorized and
empowered, to execute and deliver on behalf of itself and Owner, all instruments
of satisfaction or cancellation, or of partial or full release, discharge and
all other comparable instruments, with respect to the Mortgage Loans and with
respect to the Mortgaged Property. Owner has provided and shall, as necessary,
promptly furnish the Servicer with such powers of attorney (a form of which
is
attached hereto as Exhibit A) as are necessary and appropriate and with such
other documents as are necessary or appropriate to enable the Servicer to carry
out its servicing and administrative duties under this Agreement.
Notwithstanding
any other provision in this Agreement or the Master Mortgage Loan Purchase
Agreement to the contrary:
8
(i) In
the
case of any Mortgage Loan, the Servicer may waive any late payment charge,
penalty, interest or any assumption fees, or other fees which may be collected
in the ordinary course of servicing such Mortgage Loan;
(ii) In
the
case of a Specially Serviced Mortgage Loan, the Servicer shall notify the Owner
in writing by either fax, email or other mutually acceptable means and obtain
the Owner’s written consent prior to the Servicer modifying, amending or waiving
any of the financial terms of, or making any other modifications to the Mortgage
Loan. If Owner notifies the Servicer of its refusal to consent thereto, then
the
Servicer shall, at its option, repurchase the related Specially Serviced
Mortgage Loan. Such repurchase shall be at a price equal to (a) the Assumed
Principal Balance of the Mortgage Loan plus (b) accrued interest on such Assumed
Principal Balance at the Mortgage Loan Remittance Rate has last been paid and
distributed to Purchaser to the date of repurchase. Further, if such Mortgage
Loan is an Additional Collateral Mortgage Loan, Servicer may release a portion
of or all of the Additional Collateral related thereto provided that the release
of such Additional Collateral is in accordance with the Additional Collateral
Pledge Agreement; and
(iii) The
Servicer shall specifically notify the Owner and obtain the Owner’s consent to
the Servicer taking any of the following actions: (a) selling any Specially
Serviced Mortgage Loan or REO Property, (b) forgiving principal or interest
on,
or permitting to be satisfied at a discount, any Mortgage Loan; or (c) accepting
substitute or additional collateral, or releasing any collateral, for a Mortgage
Loan.
In
servicing and administering the Mortgage Loans, the Servicer shall employ
procedures including collection procedures and exercise the same care that
it
customarily employs and exercises in servicing and administering mortgage loans
for its own account giving due consideration to accepted mortgage servicing
practices of prudent lending institutions and Owner’s reliance on the Servicer.
In servicing and administering the Mortgage Loans, the Servicer may permit
any
Governmental Authority to have access to and review and copy the files of the
Servicer with respect to the Mortgage Loans, and Servicer is authorized to
do
whatever is necessary to comply with all Applicable Laws and the requirements
of
such Governmental Authority, including without limitation any required
modifications of the Loan Documents.
Section
4.02 Collection
of Mortgage Loan Payments.
Continuously
from the date hereof until the principal and interest on all Mortgage Loans
are
paid in full, the Servicer shall proceed diligently to collect all payments
due
under each Mortgage Loan when the same shall become due and payable and shall,
to the extent such procedures shall be consistent with this Agreement and the
terms and provisions of any related Primary Mortgage Insurance Policy, follow
such collection procedures as it follows with respect to mortgage loans
comparable to the Mortgage Loans held for its own account. Further, the Servicer
will take special care in ascertaining and estimating annual ground rents,
taxes, assessments, water rates, property insurance premiums, mortgage insurance
premiums, and all other charges that, as provided in the 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.
9
Section
4.03 Realization
Upon Defaulted Mortgage Loans.
The
Servicer shall use reasonable efforts, consistent with the procedures that
the
Servicer would use in servicing loans for its own account, to foreclose upon
or
otherwise comparably convert the ownership of Mortgaged Properties which secure
Mortgaged Loans which come into and continue in default and as to which no
satisfactory arrangements can be made for collection of delinquent payments
pursuant to Section 4.01. In addition, if an Additional Collateral Mortgage
Loan
becomes a defaulted Mortgage Loan, the Servicer shall make all reasonable
efforts available under the Loan Documents to realize upon the Additional
Collateral pertaining to such Mortgage Loan, and any proceeds from the
realization thereof (and not such Additional Collateral itself) shall be
included in the related Liquidation Proceeds and deposited in the Custodial
Account, net of any related Servicing Advances. The Servicer shall use
reasonable efforts to realize upon defaulted Mortgage Loans in such a manner
as
will maximize the receipt of principal and interest by Owner, taking into
account, among other things, the timing of foreclosure proceedings and any
proceedings with respect to Additional Collateral. The foregoing is subject
to
the provisions that, in any case in which Mortgaged Property shall have suffered
damage, the Servicer shall not be required to expend its own funds toward the
restoration of such property in excess of an aggregate of $2,000 during the
life
of the Mortgage Loan, unless it shall determine in its discretion (i) that
such
restoration will increase the proceeds of liquidation of the related Mortgage
Loan to Owner after reimbursement to itself for such expenses, and (ii) that
such expenses will be recoverable by the Servicer through Insurance Proceeds
or
Liquidation Proceeds from the related Mortgaged Property, as contemplated in
Section 4.05.
In
the
event that any payment due under any Mortgage Loan becomes 90 days delinquent
and, in the judgment of the Servicer, the related Mortgagor is not likely to
become current within a reasonable period of time, the Servicer shall commence
foreclosure or other proceedings to realize upon the Mortgaged Property securing
such Mortgage Loan.
|
Section
4.04
|
Establishment
of Custodial Accounts; Deposits in Custodial
Accounts.
|
The
Servicer shall establish and maintain at all times appropriate custodial
accounts for principal and interest, and taxes and insurance with respect to
the
Mortgage Loans. The Servicer shall segregate and hold all funds constituting
Escrow Payments collected and received pursuant to a Mortgage Loan to be so
deposited, separate and apart from any of its own funds and general assets.
The
Servicer shall deposit in the Custodial Account and retain therein the following
payments and collections received or made by it subsequent to the Cut-off Date,
or received by it prior to the Cut-off Date but allocable to a period subsequent
thereto, other than in respect of principal and interest on the Mortgage Loans
due on or before the Cut-off Date:
(i) All
payments on account of principal, including principal prepayments, on the
Mortgage Loans;
10
(ii) All
payments on account of interest on the Mortgage Loans adjusted to the Mortgage
Loan Remittance Rate;
(iii) All
Liquidation Proceeds;
(iv) All
Insurance Proceeds including amounts required to be deposited pursuant to
Sections
4.06,
4.11
and
4.18,
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
the Servicer’s normal servicing procedures the related loan documents or
applicable law;
(v) All
Condemnation Proceeds affecting any Mortgaged Property that are not released
to
the Mortgagor in accordance with the Servicer’s normal servicing procedures, the
loan documents or applicable law;
(vi) Any
Monthly Advances;
(vii) All
proceeds of any Mortgage Loan repurchased in accordance with Section 5(c) or
(d)
of the Purchase Agreement, and all amounts required to be deposited by the
Servicer in connection with shortfalls in principal amount of Qualified
Substitute Mortgage Loans pursuant to Section 5(c) of the Purchase
Agreement;
(viii) Any
amounts required to be deposited by the Servicer pursuant to Section 6.04 for
the month of distribution;
(ix) Any
amounts in respect of Permitted Investments required to be deposited pursuant
to
Section 4.18;
(x) Any
amounts required to be deposited by the Servicer in connection with any REO
Property pursuant to Section 4.11; and
(xi) Any
amounts required to be deposited into the Custodial Account pursuant to Section
7.01.
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,
to the extent permitted by Section 7.01, need not be deposited by the Servicer
in the Custodial Account. Any interest paid on funds deposited into the
Custodial Account by the depository institution shall accrue to the benefit
of
the Servicer and the Servicer shall be entitled to retain and withdraw such
interest from the Custodial Account pursuant to Section 4.05(iv). In addition,
funds in the Custodial Account may be invested in Permitted Investments in
accordance with the provisions set forth in Section 4.18.
Section
4.05 Permitted
Withdrawals From the Custodial Account.
The
Servicer may, from time to time, make withdrawals from the Custodial Account
for
the following purposes:
11
(i) To
make
payments to Owner in the amounts and in the manner provided for in Section
6.01;
(ii) To
reimburse itself for each unreimbursed Monthly Advance from the related Monthly
Payments collected from the Mortgagors or, to the extent an unreimbursed Monthly
Advance is determined by the Servicer to be unrecoverable, from any funds in
the
Custodial Account;
(iii) To
reimburse itself for unreimbursed Servicing Advances and for unreimbursed
Servicing Fees, provided that with respect to any Mortgage Loan the Servicer’s
right to such reimbursement shall be limited, subject to Section 4.13, to the
related funds collected by the Servicer from the Mortgagor or any other Person
including, but not limited to, Liquidation Proceeds, Condemnation Proceeds
and
Insurance Proceeds, and with respect to REO Property, funds received as rental
or similar income. The Servicer’s right to the reimbursement set forth in the
preceding sentence shall be prior to the rights of Owner to such proceeds and
amounts, except that where the Servicer is required to repurchase a Mortgage
Loan pursuant to Section 5(c) or (d) of the Purchase Agreement, the Servicer’s
right to such reimbursement shall be subsequent to the rights of Owner to
receive payment from the Custodial Account representing the repurchase price
set
forth in Section 5(c) or (d) of the Purchase Agreement, as applicable, and
representing all other amounts required to be paid to Owner with respect to
such
repurchased Mortgage Loan;
(iv) To
pay
itself as servicing compensation any interest earned on funds in the Custodial
Account;
(v) To
pay
itself with respect to each Mortgage Loan that has been repurchased pursuant
to
Section 5(c) or (d) of the Purchase Agreement all related Monthly Payments
and
such other amounts as may be collected by the Servicer from the Mortgagor or
otherwise relating to such Mortgage Loan, provided that such Monthly Payments
or
other amounts have not been distributed as of the date on which the related
repurchase price is determined;
(vi) To
refund
to the Servicer any amount deposited in the Custodial Account and not required
to be deposited therein; and
(vii) To
clear
and terminate the Custodial Account upon the termination of this
Agreement.
Section
4.06 Establishment
of Escrow Accounts; Deposits in Escrow Accounts.
The
Servicer shall 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. The Servicer will establish one or more
Escrow Accounts for such purpose, each of which shall be an Eligible
Account.
The
Servicer shall deposit in the Escrow Account or Accounts on a daily basis,
and
retain therein, (i) all Escrow Payments collected on account of the Mortgage
Loans, for the purpose of effecting timely payment of any such items as required
under the terms of this Agreement, and (ii) all Insurance Proceeds which are
to
be applied to the restoration or repair of any Mortgaged Property. The Servicer
shall make withdrawals therefrom only to effect such payments as are required
or
contemplated under this Agreement, and for such other purposes as set forth
or
in accordance with Section 4.07. The Servicer shall be entitled to retain any
interest paid on funds deposited into the Escrow Account by the depository
institution other than interest on escrowed funds required by law to be paid
to
a Mortgagor.
12
Section
4.07 Permitted
Withdrawals From Escrow Account.
Withdrawals
from the Escrow Account may be made by the Servicer (i) to effect timely
payments of ground rents, taxes, assessments, water rates, property insurance
premiums, Primary Mortgage Insurance Policy premiums, if applicable, and
comparable items, (ii) to reimburse the Servicer for any Servicing Advance
made
by the Servicer with respect to an Escrow Payment, but only from amounts
received on the related Mortgage Loan which represent late payments or
collections of Escrow Payments thereunder, and only to the extent permitted
by
applicable law, (iii) to refund to the Mortgagor any funds as may be determined
to be overages, (iv) for transfer to the Custodial Account in accordance with
the terms of this Agreement, (v) for application to restoration or repair of
the
Mortgaged Property, (vi) to pay to the Servicer, or to the Mortgagor to the
extent required by law, any interest paid on the funds deposited into the Escrow
Account, (vii) to refund to the Servicer any amount deposited in the Escrow
Account and not required to be deposited therein or (viii) to clear and
terminate the Escrow Account on the termination of this Agreement. As part
of
its servicing duties, the Servicer shall pay to the Mortgagors interest on
funds
in the Escrow Account, to the extent required by law, and to the extent that
interest earned on funds in the Escrow Account is insufficient, shall pay such
interest from its own funds, without any reimbursement therefor.
Section
4.08 Transfer
of Accounts.
The
Servicer may transfer the Custodial Account or the Escrow Account to a different
depository institution from time to time. The Servicer shall promptly notify
Owner upon making any such transfer. In any case, the Custodial Account and
Escrow Account shall be Eligible Accounts.
Section
4.09 [INTENTIONALLY
OMITTED]
Section
4.10 Errors
and Omissions Insurance.
The
Servicer shall maintain, at its own expense, a blanket fidelity bond and an
errors and omissions insurance policy, with broad coverage with responsible
companies that would meet the requirements of Xxxxxx Xxx or Xxxxxxx Mac on
all
officers, employees or other persons acting in any capacity with regard to
the
Mortgage Loans to handle funds, money, documents and papers relating to the
Mortgage Loans. The errors and omissions insurance shall be in the form of
the
Mortgage Banker’s Blanket Bond and shall protect and insure the Servicer against
losses, including forgery, theft, embezzlement and omissions and negligent
acts
of such Persons and shall also protect and insure the Servicer against losses
in
connection with the failure to maintain any insurance policies required pursuant
to this Agreement and the release or satisfaction of a Mortgage Loan without
having obtained payment in full of the indebtedness secured thereby. No
provision of this Section 4.10 requiring the errors and omissions insurance
shall diminish or relieve the Servicer from its duties and obligations as set
forth in this Agreement. The minimum coverage under any such bond and insurance
policy shall be at least equal to the corresponding amounts required by Xxxxxx
Mae in the Xxxxxx Xxx Xxxxxxx’ and Servicers’ Guide or by Xxxxxxx Mac in the
Xxxxxxx Xxx Xxxxxxx’ and Servicer’s Guide. Upon request of any Owner, the
Servicer shall cause to be delivered to Owner a copy of the insurance policy
and
shall use reasonable efforts to obtain a statement from the surety and the
insurer that such insurance policy shall in no event be terminated or materially
modified without thirty (30) days prior written notice to Owner.
13
Section
4.11 Title
Management and Disposition of REO Property.
The
Servicer shall either itself or through an agent selected by the Servicer,
manage, conserve, protect and operate each REO Property (and may temporarily
rent the same) in the same manner that it manages, conserves, protects and
operates other foreclosed property for its own account, and in the same manner
that similar property in the same locality as the REO Property is managed.
The
Servicer shall cause each REO Property to be inspected promptly upon the
acquisition of title thereto and shall cause each REO Property to be inspected
at least annually thereafter. The Servicer shall use reasonable efforts to
dispose of the REO Property in a commercially reasonable manner as soon as
possible. If Owner has notified the Servicer in writing that an REO Property
is
held as part of a REMIC, the Servicer will make reasonable efforts to sell
such
REO Property within the time necessary to preserve such REMIC status as advised
by Owner in the notice thereof.
If
title
to any Mortgaged Property is acquired in foreclosure or by deed in lieu of
foreclosure (each, an “REO Property”), the deed or certificate of sale shall be
taken in the name of the Owner or the Person (which may be the Servicer for
the
benefit of the Owner) designated by the Owner, or in the event the Owner
notifies the Servicer that the Owner or such Person is not authorized or
permitted to hold title to real property in the state where the REO Property
is
located, or would be adversely affected under the “doing business” or tax laws
of such state by so holding title, the deed or certificate of sale shall be
taken in the name of such Person or Persons as shall be consistent with an
opinion of counsel obtained by the Owner from an attorney duly licensed to
practice law in the state where the REO Property is located. The Servicer
(acting alone or through a subservicer), on behalf of the Owner, shall provide
for the maintenance and disposal of REO on behalf of the Owner as outlined
under
section 6 of the collection manual of Servicer.
The
Servicer shall deposit and hold all revenues and funds collected and received
in
connection with the operation of each REO Property in the Custodial Account,
and
the Servicer shall account separately for revenues and funds received or
expended with respect to each REO Property.
The
Servicer shall have full power and authority, subject only to the specific
requirements and prohibitions of this Agreement to do any and all things in
connection with any REO Property as are consistent with the servicing standards
set forth in Section 4.01. In connection therewith, the Servicer shall deposit
or cause to be deposited on a daily basis in the Custodial Account all revenues
and collections received or collected by it with respect to each REO Property,
including all proceeds of any REO Disposition. The Servicer shall withdraw
(without duplication) from the Custodial Account, but solely from the revenues
and collections received or collected by it with respect to a specific REO
Property, such funds necessary for the proper operation, management and
maintenance of such REO Property, including the following:
14
|
(a)
|
all
insurance premiums due and payable in respect of such REO
Property;
|
|
(b)
|
all
real estate taxes and assessments in respect of such REO Property
that may
result in the imposition of a lien
thereon;
|
|
(c)
|
all
customary and reasonable costs and expenses necessary to maintain,
repair,
appraise, evaluate, manage or operate such REO Property (including
the
customary and reasonable costs incurred by any “managing agent” retained
by the Servicer in connection with the maintenance, management or
operation of such REO Property);
|
|
(d)
|
all
reasonable costs and expenses of restoration improvements, deferred
maintenance and tenant improvements;
and
|
|
(e)
|
all
other reasonable costs and expenses, including reasonable attorneys’ fees,
that the Servicer may suffer or incur in connection with its performance
of its obligations under this Section (other than costs and expenses
that
the Servicer is expressly obligated to bear pursuant to this
Agreement).
|
To
the
extent that amounts on deposit in the Custodial Account are insufficient for
the
purposes set forth in clauses (1) through (5) above, the Servicer shall, subject
to Section 6.03, advance the amount of funds required to cover the shortfall
with respect thereto. The Servicer shall promptly notify the Owner in writing
of
any failure by the Servicer to make a Servicing Advance of the type specified
in
clauses (1) or (2) above (irrespective of whether such Servicing Advance is
claimed to be non-recoverable by the Servicer pursuant to Section 6.03).
The
Servicer shall notify Owner of its receipt of a bona fide offer for any REO
Property. Following the consummation of an REO Disposition, the Servicer shall
remit to the Owner, in accordance with Section 6.01, any proceeds from such
REO
Disposition in the Custodial Account following the payment of all expenses
and
Servicing Advances relating to the subject REO Property.
Section
4.12 Adjustments
to Mortgage Interest Rates.
The
Servicer shall make interest rate adjustments and payment amount adjustments
for
each Adjustable Rate Mortgage Loan in accordance with the terms of the related
Mortgage Note and will deliver to the related Mortgagor written notice of such
adjustments in accordance with the terms of such Mortgage Note and the
requirements of applicable law.
Section
4.13 Subservicing
Agreements Between the Servicer and Subservicers.
(a) Subject
to Section 13.06, the Servicer may enter into Subservicing Agreements with
Subservicers for the servicing and administration of the Mortgage Loans. The
terms of any Subservicing Agreement shall not be inconsistent with any of the
provisions of this Agreement. Each Subservicer shall be (i) authorized to
transact business in the state or states in which the Mortgaged Properties
related to the Mortgage Loans such Subservicer is to service are situated,
if
and to the extent required by applicable law to enable the Subservicer to
perform its obligations hereunder and under the Subservicing Agreement, and
(ii)
a Xxxxxxx Mac- or Xxxxxx Xxx-approved mortgage servicer. Each Subservicing
Agreement must impose on the Subservicer requirements conforming to the
provisions set forth in Section 4.17 and provide for servicing of the Mortgage
Loans consistent with the terms of this Agreement.
15
(b) As
part
of its servicing activities hereunder, the Servicer, for the benefit of Owner,
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 the Servicer, in its good faith business judgment, would require were
it
the owner of the related Mortgage Loans. The Servicer shall pay the costs of
such enforcement, to the extent, if any, that such recovery (i) exceeds all
amounts due in respect of the related Mortgage Loans, or (ii) is from a specific
recovery of costs, expenses or attorneys’ fees against the party against whom
such enforcement is directed.
Section
4.14 Successor
Subservicers.
The
Servicer 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, the Servicer either shall directly
service the related Mortgage Loans or shall enter into a Subservicing Agreement
with a successor Subservicer which qualifies under Section 4.13.
Section
4.15 Liability
of the Servicer.
Notwithstanding
any Subservicing Agreement, any of the provisions of this Agreement relating
to
agreements or arrangements between the Servicer and a Subservicer or reference
to actions taken through a Subservicer or otherwise, the Servicer shall remain
obligated and primarily liable to Owner for the servicing and administering
of
the Mortgage Loans in accordance with the provisions of Section 4.01 without
diminution of such obligation or liability by virtue of such Subservicing
Agreements or arrangements or by virtue of indemnification from the Subservicer
and to the same extent and under the same terms and conditions as if the
Servicer alone were servicing and administering the Mortgage Loans. The Servicer
shall be entitled to enter into any agreement with a Subservicer for
indemnification of the Servicer by such Subservicer and nothing contained in
this Agreement shall be deemed to limit or modify such
indemnification.
Section
4.16 Assumption
or Termination of Subservicing Agreements.
In
the
event that Xxxxxx Xxxxxxx Credit Corporation, or its successors (collectively,
“MSCC”) shall for any reason cease to be the servicer of the Mortgage Loans
under this Agreement, Owner or its designee may, if MSCC does not terminate
any
Subservicing Agreement in accordance with its terms, thereupon assume all of
the
rights and obligations of MSCC under such Subservicing Agreement. Upon such
assumption, Owner or its designee shall be deemed to have assumed all of MSCC’s
interest therein and to have replaced MSCC as a party to each Subservicing
Agreement to the same extent as if the Subservicing Agreements had been assigned
to the assuming party, except that MSCC shall not thereby be relieved of any
liability or obligations under the Subservicing Agreements and MSCC shall
continue to be entitled to any rights or benefits, in each case, which arose
prior to its termination as servicer.
16
The
Servicer at its expense shall, upon the request of Owner, deliver to the
assuming party all documents and records relating to each Subservicing Agreement
and the Mortgage Loans then being serviced and an accounting of amounts
collected and held by it and otherwise use reasonable efforts to effect the
orderly and efficient transfer of the Subservicing Agreements to the assuming
party.
Section
4.17 Servicing
Accounts.
In
those
cases where a Subservicer is servicing a Mortgage Loan pursuant to a
Subservicing Agreement, the Subservicer shall be required to establish and
maintain a Subservicing Account which shall be an Eligible Account. The
Subservicer shall be required to deposit into the Subservicing Account not
later
than the first Business Day after receipt all proceeds of Mortgage Loans
received by the Subservicer, less its subservicing compensation to the extent
permitted by the Subservicing Agreement, and to remit such proceeds to the
Servicer for deposit in the Custodial Account not later than the tenth day
of
each month, or if such tenth day is not a Business Day, the immediately
succeeding Business Day. For purposes of this Agreement, the Servicer shall
be
deemed to have received payments on the Mortgage Loans when the Subservicer
has
received such payments pursuant to the Subservicing Agreement.
Section
4.18 Permitted
Investments.
The
Servicer may invest the funds in the Custodial Account in Permitted Investments,
each of which shall mature not later than the Business Day immediately preceding
the Remittance Date next following the date of such investment (except that
if
such Permitted Investment is an obligation of the institution that maintains
such account, then such Permitted Investment shall mature not later than such
Remittance Date) and shall not be sold or disposed of prior to its maturity.
All
such Permitted Investments shall be registered in the name of the Servicer
or
its nominee, and held in trust for Owner. All income and gain realized from
any
such investment as well as any interest earned on deposit in the Custodial
Account shall be for the benefit of the Servicer, and shall be withdrawn by
the
Servicer on the related Remittance Date. The Servicer shall deposit in the
Custodial Account (with respect to investments made hereunder of funds held
therein) an amount equal to the amount of any loss incurred in respect of any
such investment immediately upon realization of such loss without right of
reimbursement.
|
Section
4.19
|
Payment
of Taxes, Insurance and Other Charges; Maintenance of Primary Mortgage
Insurance Policies; Collections
Thereunder.
|
With
respect to each Mortgage Loan, the Servicer shall maintain accurate records
reflecting the status of ground rents, taxes, assessments, water rates and
other
charges which are or may become a lien upon the Mortgaged Property and the
status of Primary Mortgage Insurance Policy 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 the Servicer in amounts sufficient for such purposes, as
allowed under the terms of the Mortgage and applicable law. If a Mortgage does
not provide for Escrow Payments, then the Servicer shall require that any such
payments be made by the Mortgagor at the time they first become due. The
Servicer assumes full responsibility for the timely payment of all such bills
and shall effect timely payments of all such bills irrespective of the
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 but shall be entitled to reimbursement thereof in accordance with
the
terms of this Agreement.
17
The
Servicer shall maintain in full force and effect a Primary Mortgage Insurance
Policy, with respect to each Mortgage Loan for which such coverage is required.
Such coverage will be maintained until the Loan-to-Value Ratio of the related
Mortgage Loan is reduced to 75% or less in the case of a Mortgage Loan having
a
Loan-to-Value Ratio at origination in excess of 80% or until such time, if
any,
as such insurance is required to be released in accordance with the provisions
of applicable law including, but not limited to, the Homeowners Protection
Act
of 1998. The Servicer shall assure that all premiums due under any Primary
Mortgage Insurance Policy are paid in a timely manner, but, shall be entitled
to
reimbursement pursuant to the terms of this Agreement for premiums paid by
the
Servicer on behalf of any Mortgagor who is obligated to pay such premiums but
fails to do so. The Servicer shall not cancel or refuse to renew any Primary
Mortgage Insurance Policy in effect on the Funding Date that is required to
be
kept in force under this Agreement unless a replacement Primary Mortgage
Insurance Policy for such canceled or nonrenewed policy is obtained from and
maintained with an insurer. The Servicer shall not take any action which would
result in noncoverage under any applicable Primary Mortgage Insurance Policy
of
any loss which, but for the actions of the Servicer, would have been covered
thereunder.
In
connection with its activities as servicer, the Servicer agrees to prepare
and
present, on behalf of itself and the Owner, claims to the insurer under any
Primary Mortgage Insurance Policy in a timely fashion in accordance with the
terms of such policies and, in this regard, to take such action as shall be
necessary to permit recovery under any Primary Mortgage Insurance Policy
respecting a defaulted Mortgage Loan. Pursuant to Section 4.04, any amounts
collected by the Servicer under any Primary Mortgage Insurance Policy shall
be
deposited in the Collection Account.
Section
4.20 Maintenance
of Hazard Insurance.
The
Servicer shall cause to be maintained for each Mortgage Loan fire and hazard
insurance with extended coverage as is customary in the area where the Mortgaged
Property is located in an amount that is at least equal to the lesser of (a)
the
maximum insurable value of the improvements securing such Mortgage Loan and
(b)
the greater of (1) the Unpaid Principal Balance of such Mortgage Loan or (2)
an
amount such that the proceeds thereof shall be sufficient to prevent the
Mortgagor and/or the loss payee from becoming a co insurer.
18
If
any
Mortgaged Property is in an area identified by the Federal Emergency Management
Agency as having special flood hazards and such flood insurance has been made
available, then the Servicer 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 lesser of (a) the minimum amount
required, under the terms of coverage, to compensate for any damage or loss
on a
replacement cost basis (or the outstanding principal balance of the related
Mortgage Loan if replacement cost coverage is not available for the type of
building insured) or (b) the maximum amount of insurance which is available
under the Flood Disaster Protection Act of 1973, as amended (assuming that
the
area in which such Mortgaged Property is located is participating in such
program).
The
Servicer shall also maintain on each REO Property fire, hazard and liability
insurance, and to the extent required and available under the Flood Disaster
Protection Act of 1973, as amended, flood insurance with extended coverage
in an
amount which is at least equal to the lesser of (a) the maximum insurable value
of the improvements which are a part of such property and (b) the outstanding
principal balance of the related Mortgage Loan at the time it became an REO
Property plus accrued interest at the Mortgage Interest Rate and related
Servicing Advances.
ARTICLE
V
ADMINISTRATION
AND SERVICING OF TRADING ACCOUNTS
Section
5.01 The
Servicer to Service Trading Accounts.
(a) The
Servicer represents and warrants that it will service and administer the Trading
Accounts, in accordance with the terms of (i) the procedures it employs to
administer Trading Accounts for its own benefit (as the same may be amended
from
time to time) and (ii) the related Additional Collateral Pledge
Agreement.
(b) The
Servicer shall be released from its obligations to administer the Trading
Accounts as applicable upon termination of the related Additional Collateral
Pledge Agreement.
(c) The
Servicer may, without consent of Owner, amend or modify a Additional Collateral
Pledge Agreement in any non-material respect to reflect administrative or
account changes.
(d) Notwithstanding
anything to the contrary in this Agreement (including without limitation the
termination of the Servicing rights and/or obligations of the Servicer under
Article XI of this Agreement), the Servicer shall service and administer each
Trading Account, each Additional Collateral Pledge Agreement and each Additional
Collateral Mortgage Loan, in accordance with the terms of this Agreement and
each Additional Collateral Pledge Agreement; it being understood and agreed
that
only the Servicer shall service and administer the related securities accounts,
lines of credit, mortgages, and guarantors with respect to Additional Collateral
Pledge Agreement.
19
(e) Notwithstanding
Section 4.04, when the Collateral Base for any Additional Collateral Mortgage
Loan is less than the Loan Amount for such Additional Collateral Mortgage Loan,
the Servicer shall cause cash received upon exercise of foreclosure rights
under
the related Additional Collateral Pledge Agreement, if it has not been
previously applied to reduce the principal balance of such Additional Collateral
Mortgage Loan, to be deposited into the Custodial Account.
(f) The
Servicer shall use its reasonable efforts to realize upon any Additional
Collateral for such of the Additional Collateral Mortgage Loans as come into
and
continue in default and as to which no satisfactory arrangements can be made
for
collection of delinquent payments; provided that the Servicer shall not obtain
title to any such Additional Collateral as a result of or in lieu of the
disposition thereof or otherwise; and provided further that (i) the Servicer
shall not proceed with respect to such Additional Collateral in any manner
that
would impair the ability to recover against the related Mortgaged Property,
and
(ii) the Servicer shall proceed with any acquisition of REO Property in a manner
that preserves the ability to apply the proceeds of such Additional Collateral
against amounts owed under the defaulted Mortgage Loan. Any proceeds realized
from such Additional Collateral (other than amounts to be released to the
Mortgagor or the related guarantor in accordance with procedures that the
Servicer would follow in servicing loans held for its own account, subject
to
the terms and conditions of the related Mortgage and Mortgage Note and to the
terms and conditions of any security agreement, guarantee agreement, mortgage
or
other agreement governing the disposition of the proceeds of such Additional
Collateral) shall be deposited in the Custodial Account, subject to withdrawal
pursuant to Section 4.05 of this Agreement.
Section
5.02 Agreements
with Respect to the Surety Bond.
(a) The
Servicer represents and warrants to Owner that the Additional Collateral
Mortgage Loans are insured under the terms and provisions of the Surety Bond,
subject to the limitations set forth therein. Owner acknowledges receipt from
the Surety Bond Issuer of a certificate confirming the insurance of the
Additional Collateral Mortgage Loans pursuant to the terms and provisions of
the
Surety Bond.
(b) Owner
and
the Servicer agree that the Surety Bond Issuer is a third party beneficiary
in
respect of the Servicer’s obligations under this Article V.
(c) With
respect to the sale or potential sale of the Additional Collateral Mortgage
Loans, Owner shall not use, circulate, quote or otherwise refer to the Surety
Bond Issuer or the Surety Bond for any purpose, including but not limited to,
the registration, purchase and sale of securities, nor file the Surety Bond
with, or refer to it or to the Surety Bond Issuer, as part of any registration
statement or offering document, without the express prior written consent of
the
Surety Bond Issuer as to both form and substance of such
disclosure.
20
ARTICLE
VI
PAYMENTS
TO OWNER
Section
6.01 Distributions.
On
each
Remittance Date with respect to each Mortgage Loan, subject to Section 6.03(c),
the Servicer shall distribute to Owner (i) all amounts due on the Due Date
immediately preceding the related Remittance Date (which shall include all
scheduled interest and principal), net of charges against or withdrawals from
the Custodial Account pursuant to clauses (ii) through (vi) of Section 4.05,
plus any principal prepayments received during the related Principal Prepayment
Period, minus (iii) any amounts attributable to Monthly Payments collected
as to
such Mortgage Loans but due on a Due Date or Due Dates subsequent to the current
Remittance Date.
Subject
to Section 6.03(c), all distributions made to Owner on each Remittance Date
will
be made to Owner of record on the preceding Record Date, and shall be based
on
the Mortgage Loans owned and held by Owner, and shall be made by wire transfer
of immediately available funds to the account of Owner at a bank or other entity
having appropriate facilities therefor, or if Owner shall have so notified
the
Servicer, by check mailed to the address of Owner as provided for in Section
12.06.
With
respect to any remittance received by Owner on or after the second Business
Day
following the Business Day on which such payment was due, the Servicer shall
pay
to Owner interest on any such late payment at an annual rate equal to the rate
of interest as is publicly announced from time to time at its principal office
by Chase Manhattan Bank, N. A., New York, New York, as its “prime” lending rate
(which is not necessarily its lowest rate) (or if Chase Manhattan Bank, N.A.
shall cease to exist or to announce such rate, then such rate shall be a
reasonably comparable rate determined by Servicer in its reasonable discretion),
adjusted as of the date of each change, plus one (1) percentage point, but
in no
event greater than the maximum amount permitted by applicable law. Such interest
shall be paid by the Servicer to Owner on the date such late payment is made
and
shall cover the period commencing with the day following such second Business
Day and ending with the Business Day on which such payment is made, both
inclusive. Such interest shall be remitted along with such late payment. The
payment by the Servicer of any such interest shall not be deemed an extension
of
time for Payment or a waiver of any Event of Default by the
Servicer.
Section
6.02 Statements
to Owner.
Not
later
than the tenth (10th) day of each month, the Servicer will furnish to Owner
a
monthly remittance report in a format substantially similar to Exhibit B hereto,
which monthly remittance report will be generated as of the expiration of the
preceding month.
The
Servicer shall provide Owner with such information concerning the Mortgage
Loans
as is necessary for Owner to prepare its federal income tax return as Owner
may
reasonably request from time to time.
Section
6.03 Monthly
Advances by the Servicer.
21
(a) With
respect to each Mortgage Loan and subject to Section 6.03(c), on each Remittance
Date the Servicer shall, pursuant to Section 6.01, remit to Owner the total
of
all scheduled Monthly Payments due on the preceding Due Date whether or not
such
Monthly Payments were collected from the Mortgagor. Any amounts which are due
but uncollected shall, subject to subsection (c) below, be funded only by using
excess cash collections, if any, on deposit in the Custodial
Account.
(b) If
the
collections on deposit in the Custodial Account on the Remittance Date are
less
than the amount of the required monthly remittance, the Servicer shall, subject
to subsection (c) below, make a Monthly Advance by depositing to the Custodial
Account enough of its own funds to make the total on deposit equal the full
amount of the remittance due Owner. The Servicer may reimburse itself for its
advances from collections from Mortgagors that are subsequently deposited into
the Custodial Account to the extent provided in Section 4.05.
(c) If
the
Servicer determines, in its reasonable judgment, that any uncollected payment
due from a Mortgagor that is due to be paid to Owner pursuant to Section 6.01
would not be recoverable from Liquidation Proceeds or other payments or
recoveries (including Insurance Proceeds or Condemnation Proceeds) on the
related Mortgage Loan, then the Servicer will ensure that the amount considered
to be non-recoverable will not be funded from excess collections or advanced
by
the Servicer, and will therefore not be remitted to Owner until the earlier
to
occur of (a) the purchase of the Mortgage Loan by the Servicer, if applicable,
or (b) the acquisition or disposition of title to the related Mortgaged Property
through foreclosure or otherwise, and then in each case shall only be paid
to
the extent of such repurchase price or recovery.
(d) The
Servicer’s obligations to make Monthly Advances as to any Mortgage Loan pursuant
to Section 6.03(a) and (b) will continue through the last Monthly Payment due
prior to the payment in full of the Mortgage Loan, or through the Remittance
Date for the remittance of all Liquidation Proceeds or other payments or
recoveries (including Insurance Proceeds or Condemnation Proceeds) with respect
to the related Mortgage Loan or the related REO Property, subject to Section
6.03(c). With respect to any Mortgage Loans determined to be unrecoverable
and
whose Monthly Payments are omitted from the scheduled monthly remittance, the
Servicer shall deliver an Officer’s Certificate to Owner setting forth the basis
of such determination.
Section
6.04 Compensating
Interest.
Not
later
than the close of business on the Business Day preceding each Remittance Date,
the Servicer shall from its own funds deposit in the Custodial Account an amount
equal to the lesser of (i) the aggregate of the Prepayment Interest Shortfalls,
if any, that exist in respect of the related Principal Prepayment Period and
(ii) the aggregate of the Servicing Fees for the most recently ended calendar
month.
If
for
any reason the Servicer fails to process any principal prepayment on a timely
basis in accordance with Section 4.04(i), the Servicer shall from its own funds
deposit in the Custodial Account, interest at the Mortgage Interest Rate on
the
principal prepayment for the period the deposit into the Custodial Account
was
delayed.
22
ARTICLE
VII
GENERAL
SERVICING PROCEDURE
Section
7.01 Assumption
Agreements.
If
the
Servicer acquires actual knowledge that a Mortgagor has transferred or proposes
to transfer the related Mortgaged Property, the Servicer shall enforce any
related “due-on-sale” clause consistent with its practices for mortgage loans it
services for its own account. If the Servicer elects not to enforce such
due-on-sale clause, the Servicer may enter into an assumption agreement with
the
party to whom such Mortgaged Property is to be or has been conveyed. If any
assumption fee is collected by the Servicer for entering into an assumption
agreement, the Servicer shall be entitled to retain a portion of such fee up
to
an amount equal to 1% of the outstanding principal balance of the related
Mortgage Loan as additional servicing compensation, and shall deposit into
the
Custodial Account any portion thereof that exceeds 1% of such outstanding
principal balance.
Section
7.02 Satisfaction
of Mortgages and Release of Mortgage Files.
Upon
the
payment in full of any Mortgage Loan and deposit of such payment by Servicer
into the Custodial Account pursuant to Section 4.04, the Servicer shall execute
any document necessary to satisfy the Mortgage Loan and request delivery to
it
of the portion of the Mortgage File held by Owner or the Custodian. Upon receipt
of such request, the related mortgage documents shall be released to the
Servicer within seventy-two (72) hours and the Servicer shall prepare and
process any satisfaction or release. No expense incurred in connection with
any
instrument of satisfaction or deed of reconveyance shall be chargeable to the
Custodial Account or Owner.
To
the
extent that Owner acts as its own custodian, from time to time and as
appropriate for the servicing or foreclosure of the Mortgage Loan, including
for
this purpose collection under any Primary Mortgage Insurance Policy, Owner
shall, upon request of the Servicer and delivery to Owner of a servicing receipt
signed by a Servicing Officer, release the requested portion of the Mortgage
File held by Owner to the Servicer. Owner shall promptly deliver the request
to
return the related Mortgage documents to the Custodian. The Servicer shall
return the Mortgage documents to Owner when the need therefor by the Servicer
no
longer exists, unless the Mortgage Loan has been liquidated and the Liquidation
Proceeds relating to the Mortgage Loan have been deposited into the Custodial
Account or the Mortgage File or such document has been delivered to an attorney,
or to a public trustee or other public official as required by law, for purposes
of initiating or pursuing legal action or other proceedings for the foreclosure
of the Mortgaged Property either judicially or non-judicially. Upon receipt
of a
certificate of a Servicing Officer stating that such Mortgage Loan was
liquidated, the servicing receipt shall be released by Owner to the
Servicer.
Section
7.03 Servicing
Compensation.
In
addition to any other fees to which Servicer is entitled hereunder, as
compensation for its services hereunder, the Servicer shall be entitled to
a
Servicing Fee payable with respect to each Mortgage Loan. As to each Mortgage
Loan, the Servicing Fee shall (i) be payable monthly from payment of interest
on
such Mortgage Loan prior to the deposit of such payments into the Custodial
Account, (ii) accrue at the applicable Servicing Fee Rate, and (iii) be computed
on the basis of the same principal amount and for the same period respecting
which such interest payment was computed. The Servicer shall be entitled to
recover accrued but unpaid Servicing Fees in respect of any Mortgage Loan to
the
extent permitted by Section 4.05. The Servicer’s right to the Servicing Fee
shall not be transferred in whole or in part except in connection with the
transfer of all the Servicer’s obligations under this Agreement. Servicing
compensation in addition to the Servicing Fee, in the form of assumption fees
as
provided in Section 7.01, interest paid on funds deposited in the Escrow Account
to the extent permitted by Section 4.06, default interest in excess of the
Mortgage Interest Rate and late payment charges and other ancillary fees, in
each case to the extent collected, shall be retained by the Servicer and shall
not be required to be deposited into the Custodial Account. The Servicer 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.
23
Section
7.04 Annual
Statement as to Compliance and Attestation.
(a) Unless
an
Annual Statement as to Compliance is delivered as provided in Section 13.04,
the
Servicer will deliver to Owner on or before April 1 of each year, beginning
with
April 1 of the calendar year after the year in which the first Closing Date
occurs, an Officer’s Certificate stating that (i) a review of the activities of
the Servicer during the preceding calendar year and of performance under this
Agreement has been made under such officer’s supervision, and (ii) to such
officer’s knowledge, based on such review, the Servicer has fulfilled all of its
material obligations under this Agreement throughout such year in all material
respects, 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.
(b) Unless
a
Report on Assessment of Compliance and Attestation is delivered as provided
in
Section 13.05, on or before April 1 of each year, beginning with April 1 of
the
calendar year after the year in which the first Closing Date occurs, the
Servicer at its expense shall cause a firm of independent certified public
accountants (which may also render other services to the Servicer) to furnish
a
report to Owner to the effect that certain mortgage loans serviced by the
Servicer were included in the total population of Mortgage Loans subject to
selection for testing in such firm’s examination of certain documents and
records, that such examination was conducted substantially in compliance with
the Uniform Single Attestation Program for Mortgage Bankers and that such
examination disclosed no items of material noncompliance with the provisions
of
the Uniform Single Attestation Program for Mortgage Bankers, except for such
items of noncompliance as shall be set forth in such report.
Section
7.05 Owner’s
Right to Examine the Servicer Records .
Owner
shall have the right to examine and audit upon reasonable prior written notice,
during business hours or at such other times as might be reasonable under
applicable circumstances, any and all of the books, records, documentation
or
other information of the Servicer, or held by another for the Servicer or on
its
behalf or otherwise, which may be relevant to the performance or observance
by
the Servicer of the terms, covenants or conditions of this
Agreement.
24
The
Servicer shall provide to Owner and any supervisory agents or examiners which
may relate to Owner access to any documentation regarding the Mortgage Loans
which may be required by all applicable regulations. Such access shall be
afforded without charge, upon reasonable request, during normal business hours
and at the offices of the Servicer.
Neither
Owner nor the Servicer shall, nor will they permit any of their respective
affiliates, employees, agents or representatives to, divulge or disclose,
directly or indirectly, any information concerning the Mortgage Loans in
violation of any law. Neither party shall, nor shall they permit any of their
respective affiliates, employees, agents or representatives to, divulge or
disclose, directly or indirectly, any information concerning the business
practices of the other party to this Agreement. This paragraph does not apply
to
information which is not confidential or which has been published or otherwise
made available to the general public prior to the date of this Agreement, or
information required to be released under law or by or to any regulatory,
administrative or judicial body or agency or the furnishing by either party
of
information to their respective affiliates, auditors, or attorneys.
ARTICLE
VIII
REPORTS
TO BE PREPARED BY SERVICER
Section
8.01 The
Servicer Shall Provide Information as Reasonably Required
.
During
the term of this Agreement the Servicer shall furnish any reports, or
documentation that Owner may reasonably request. Reports requested may include
reports not specified or otherwise required by this Agreement, for example,
reports with respect to REO Properties, or reports required to comply with
any
regulations regarding any supervisory agents or examiners of Owner. All reports
will be delivered in accordance with Owner’s reasonable instructions and
directions. If the reports or other information requested will require the
Servicer to incur additional costs or expenses outside of its normal servicing
procedures, Owner agrees to reimburse the Servicer for those costs and expenses.
The Servicer agrees to execute and deliver all such instruments and take all
such action as Owner, from time to time, may reasonably request in order to
effectuate the purpose and to carry out the terms of this
Agreement.
ARTICLE
IX
THE
SERVICER
Section
9.01 Indemnification;
Third Party Claims.
(a) Each
party hereto agrees to indemnify the other party and hold it harmless against
any and all claims, losses, penalties, fines, forfeitures, legal fees and
related costs, judgments, and any other costs, fees and expenses that the other
party may sustain in any way related to the breach of such party in performing
its duties and obligations under this Agreement.
25
(b) The
Servicer shall (i) promptly notify Owner if a material claim is made by any
party with respect to this Agreement or the Mortgage Loans, (ii) assume the
defense of any such claim and pay all expenses in connection therewith,
including attorneys’ fees, and (iii) promptly pay, discharge and satisfy any
judgment or decree which may be entered against it or Owner in respect of such
claim. The Servicer shall follow any written instructions received from Owner
in
connection with such claim. Owner shall promptly reimburse the Servicer for
all
amounts paid or advanced by it pursuant to the preceding sentence, except as
to
amounts as to which the Servicer is required to indemnify Owner pursuant to
Section 3.01.
Section
9.02 Merger
or Consolidation of the Servicer .
The
Servicer 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 the Servicer may be merged or consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Servicer
shall be a party, or any Person succeeding to the business of the Servicer,
shall be the successor of the Servicer 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.
Section
9.03 Limitation
on Liability of the Servicer and Others.
Neither
the Servicer nor any of the officers, employees or agents of the Servicer shall
be under any liability to Owner for any action taken or for refraining from
the
taking of any action in good faith pursuant to this Agreement, or for errors
in
judgment; provided, however, that this provision shall not protect the Servicer
or any such person against any breach of warranties or representations made
herein, or failure to perform its obligations substantially in accordance with
any standard of care set forth in this Agreement, or any liability which would
otherwise be imposed by reason of any breach of the terms and conditions of
this
Agreement. The Servicer and any officer, employee or agent of the Servicer
may
rely in good faith on any document of any kind appearing to be properly executed
and submitted by any Person respecting any matters arising hereunder. The
Servicer shall not be under any obligation to appear in, prosecute or defend
any
legal action which is not incidental to its duties to service the Mortgage
Loans
in accordance with this Agreement and which in its opinion may involve it in
any
expenses or liability; provided, however, that the Servicer may, with the
consent of Owner, undertake any such action which it may deem necessary or
desirable in respect to this Agreement and the rights and duties of the parties
hereto. In such event, the legal expenses and costs of such action and any
liability resulting therefrom shall be expenses, costs and liabilities for
which
Owner will be liable. The Servicer shall be entitled to be reimbursed therefor
from Owner upon written demand.
Section
9.04 The
Servicer Not to Resign.
Subject
to Section 12.04, the Servicer shall not resign from the obligations and duties
hereby imposed on it except (i) by mutual consent of the Servicer and Owner,
(ii) upon the determination that its duties hereunder are no longer permissible
under applicable law and such incapacity cannot be cured by the Servicer (any
such determination permitting the resignation of the Servicer shall be evidenced
by an opinion of counsel to such effect delivered to Owner), (iii) following
any
breach of this Agreement by Owner, or (iv) in connection with a sale of
substantially all of the assets of the Servicer. No such resignation shall
become effective until a successor shall have assumed the Servicer’s
responsibilities and obligations hereunder in the manner provided in Section
12.01.
26
ARTICLE
X
DEFAULT
Section
10.01 Events
of Default .
If
one or
more of the following “Events of Default” by the Servicer shall occur and be
continuing.
|
(i)
|
any
failure by the Servicer to remit to Owner any payment required to
be made
under the terms of this Agreement which continues unremedied for
a period
(3) Business Days after the date on which written notice of such
failure,
requiring the same to be remedied, shall have been given to the Servicer
by Owner; or
|
|
(ii)
|
failure
on the part of the Servicer duly to observe or perform in any material
respect any other of the covenants or agreements on the part of the
Servicer set forth in this Agreement which continues unremedied for
a
period of thirty (30) days (except that such number of days shall
be
fifteen (15) in the case of a failure to pay any premium for any
insurance
policy required to be maintained under this Agreement) after the
date on
which written notice of such failure, requiring the same to be remedied,
shall have been given to the Servicer by Owner;
or
|
|
(iii)
|
a
decree or order of a court or agency or supervisory authority having
jurisdiction for the appointment of a conservator receiver or liquidator
in any insolvency, readjustment of debt, marshaling of assets and
liabilities or similar proceedings, or for the winding-up or liquidation
of its affairs, shall have been entered against the Servicer and
such
decree or order shall have remained in force undischarged or unstayed
for
a period of sixty (60) days; or
|
|
(iv)
|
the
Servicer shall consent to the appointment of a conservator, receiver
or
liquidator in any insolvency, readjustment of debt, marshaling of
assets
and liabilities or similar proceedings of or relating to the Servicer
or
of or relating to all or substantially all of its property;
or
|
|
(v)
|
the
Servicer shall admit in writing its inability to pay its debts generally
as they become due, file a petition to take advantage of any applicable
insolvency or reorganization statute, make an assignment for the
benefit
of its creditors, or voluntarily suspend payment of its obligations;
or
|
|
(vi)
|
the
Servicer ceases to be eligible to sell Mortgage Loans to and service
Mortgage Loans for Xxxxxx Xxx and Xxxxxxx Mac, and continues to be
ineligible to sell Mortgage Loans to and service Mortgage Loans for
Xxxxxx
Mae and Xxxxxxx Mac for a period of sixty (60) days after the date
on
which written notice of such ineligibility shall have been given
to the
Servicer by Xxxxxx Mae and Xxxxxxx
Mac;
|
27
then,
and
in each and every such case, so long as an Event of Default shall not have
been
remedied, Owner, by notice in writing to the Servicer, in addition to whatever
rights Owner may have at law or in equity to damages, including injunctive
relief and specific performance, may terminate all the rights and obligations
of
the Servicer under this Agreement and in and to the Mortgage Loans and the
proceeds thereof other than, with respect to any Additional Collateral Mortgage
Loan, the obligation to administer the related Additional Collateral Pledge
Agreement. On or after the receipt by the Servicer of such written notice,
(i)
all authority and power of the Servicer 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 12.01, except with respect to any
related Additional Collateral Pledge Agreement, and (ii) upon further written
request from Owner, the Servicer shall prepare, execute and deliver, any and
all
documents and other instruments, deliver to the successor all Mortgage Files,
and do or accomplish all other acts or things necessary or appropriate to effect
the purposes of such notice of termination, including the transfer and
endorsement or assignment of the Mortgage Loans and related documents, or
otherwise, at the Servicer’s sole expense. The Servicer agrees to cooperate with
Owner and such successor in effecting the termination of the Servicer’s
responsibilities and rights hereunder as provided above, including, without
limitation, the transfer to such successor for administration by it of all
cash
amounts which shall at the time be credited by the Servicer to the Custodial
Account or Escrow Account or thereafter received with respect to the Mortgage
Loans.
Section
10.02 Waiver
of Defaults .
Owner
may
waive any default by the Servicer 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 thereon except to the extent expressly so waived.
ARTICLE
XI
TERMINATION;
REPURCHASE
Section
11.01 Termination
.
The
respective obligations and responsibilities of the Servicer shall terminate
upon
the latest to occur of: (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan or the disposition
of
all REO Property and the remittance of all funds due hereunder, (ii) the date
agreed upon by mutual consent of the Servicer and Owner in writing, (iii) the
repurchase by the Servicer of all of the Mortgage Loans subject to this
Agreement, pursuant to Section 11.02, or (iv) a resignation permitted by Section
9.04 hereof.
Section
11.02 Repurchase.
28
At
the
sole option of the Servicer and upon thirty (30) days prior written notice
to
Owner, if the aggregate outstanding principal balance of all Mortgage Loans
subject to this Agreement which have not been written off as non-performing
assets shall be less than ten percent (10%) of the aggregate Purchase Price
paid
for such Mortgage Loans, the Servicer may repurchase all such outstanding
Mortgage Loans; provided, however, that if such Mortgage Loans are included
in a
REMIC, the Servicer agrees not to exercise its right to repurchase unless and
until such right can be exercised in conjunction with a “qualified liquidation”
(as defined in Section 860F(a)(4) of the Code) of such REMIC, as advised by
Owner. Such repurchase by the Servicer of such Mortgage Loans and all related
REO Property shall be at a price equal to 100% of the outstanding principal
balance of each Mortgage Loan on the day of repurchase, plus accrued and unpaid
interest thereon at the Mortgage Loan Remittance Rate to the first day of the
calendar month following repurchase, plus the appraised value of any such REO
Property determined at the expense of the Servicer by an appraiser mutually
agreed upon by the Servicer and Owner.
ARTICLE
XII
MISCELLANEOUS
PROVISIONS
Section
12.01 Successor
to the Servicer.
Prior
to
termination of the Servicer’s responsibilities and duties under this Agreement
pursuant to Sections 9.04, 10.01, 11.01 or 12.04, Owner shall (i) succeed to
and
assume all of the Servicer’s responsibilities, rights, duties and obligations
under this Agreement, or (ii) appoint a successor who is a Xxxxxx Mae/Xxxxxxx
Mac approved servicer having a net worth of not less than $15,000,000 and which
shall succeed to all rights and assume all of the responsibilities, duties
and
liabilities of the Servicer under this Agreement prior to the termination of
the
Servicer’s responsibilities, duties and liabilities under this
Agreement.
In
connection with such appointment and assumption, Owner may make such
arrangements for the compensation of such successor out of payments on Mortgage
Loans as it and such successor shall agree. In the event that the Servicer’s
duties, responsibilities and liabilities under this Agreement should be
terminated pursuant to one of the aforementioned Sections, the Servicer 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 materially impair
or prejudice the rights or financial condition of its successor. The resignation
or removal of the Servicer 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 the Servicer of the representations and warranties
previously made pursuant to Section 3.01 hereof or Section 5 of the Purchase
Agreement and the remedies available to Owner with respect thereto hereunder
and
thereunder.
Any
successor appointed as provided in this Section 12.01 shall execute, acknowledge
and deliver to the Servicer and to Owner an instrument accepting such
appointment, whereupon such successor shall become fully vested with all the
rights, powers, duties, responsibilities, obligations and liabilities of the
Servicer, with like effect as if originally named as a party to this Agreement.
Any termination or resignation of the Servicer or termination of this Agreement
pursuant to Section 9.04, 10.01, 11.01, or 12.04 shall not affect any claims
that Owner may have against the Servicer arising prior to any such termination
or resignation.
29
The
Servicer shall in a timely and reasonable manner deliver to the successor the
funds in the Custodial Account and the Escrow Account and the Mortgage Files
and
related documents and statements held by it hereunder and the Servicer shall
account for all funds. The Servicer shall execute and deliver such instruments
and do such other things all as may reasonably be required to more fully and
definitely vest and confirm in the successor all such rights, powers, duties
and
responsibilities of the Servicer. The successor shall make arrangements as
it
may deem appropriate to reimburse the Servicer for amounts the Servicer actually
expended pursuant to this Agreement which the Servicer is entitled to retain
hereunder and which would otherwise have been reimbursable to the Servicer
pursuant to this Agreement but for the appointment of the successor
servicer.
Section
12.02 Amendment.
This
Agreement may be amended from time to time by the Servicer and Owner only by
written agreement signed by the Servicer and Owner. Neither this Agreement
nor
any term hereof may be changed, waived, discharged or terminated orally, but
only by an instrument in writing signed by the party against whom enforcement
of
the change, waiver, discharge or termination is sought.
Section
12.03 Assignments.
Except
as
required under the Purchase Agreement or by applicable law, the Assignments
shall not be recorded by Seller. The Owner may, at its option and expense
(including all recordation fees), prepare and record any Assignment of
Mortgage.
Section
12.04 Assignment
of Servicing Rights .
The
Servicer may assign the servicing rights with respect to the Mortgage Loans
upon
the written consent of Owner, which consent shall not be unreasonably withheld
or delayed; provided, however, the Servicer may, without the consent of Owner
enter into one or more Subservicing Agreements relating to the Mortgage Loans;
further provided, however that notwithstanding any subservicing arrangement,
the
Servicer shall remain liable to Owner for all obligations and responsibilities
set forth in this Agreement.
Section
12.05 Governing
Law.
This
Agreement is to be governed by, and construed in accordance with, the internal
laws (as compared to conflicts of law provisions) of the State of
Illinois.
Section
12.06 Notices.
Any
notices, consents or other communications permitted or required hereunder shall
be in writing and shall be deemed conclusively to have been duly given if
personally delivered, sent by overnight courier, or mailed by registered mail,
postage prepaid, and return receipt requested, or transmitted by telex or
telegraph and confirmed by a similar mailed writing, or otherwise received,
if
to Owner, addressed to Owner at Xxx Xxxxxxxxx Xxxxx, Xxxxx 000, Xxxx Xxxxxx,
Xxxxxxxxxx 00000, Attention: [ ], fax number [ ], or to such other address
as
Owner may designate in writing to the Servicer; if to the Servicer, addressed
to
the Servicer at at 0000 Xxxx Xxxx Xxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention:
Senior Vice President, fax number [(___) ___-____], with a copy to Xxxxx de
la
Xxxx, Vice President, Xxxxxx Xxxxxxx-Law Division, 0000 Xxxxxxxx, Xxx Xxxx,
Xxx
Xxxx 00000, fax number (000) 000-0000, or to such other address as the Servicer
may have designated in writing to Owner and Guarantor; and, if to Guarantor,
addressed to Guarantor at Xxx Xxxxxxxxx Xxxxx, Xxxxx 000, Xxxx Xxxxxx,
Xxxxxxxxxx 00000, Attention: [ ], fax number [ ], or to such other address
as
Guarantor may designate in writing to the Servicer.
30
Section
12.07 Severability
Provisions.
Any
part,
provision, representation or warranty of this Agreement that is prohibited
or
unenforceable or is held to be void or unenforceable in any jurisdiction shall
be ineffective, in such jurisdiction, to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and
any
such prohibition or unenforceability in any jurisdiction as to any Mortgage
Loan
shall not invalidate or render unenforceable such provision in any other
jurisdiction.
Section
12.08 Exhibits.
The
exhibits to this Agreement are hereby incorporated and made a part hereof and
are an integral part of this Agreement.
Section
12.09 General
Interpretive Principles.
For
purposes of this Agreement, except as otherwise expressly provided or unless
the
context otherwise requires:
|
(i)
|
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;
|
|
(ii)
|
accounting
terms not otherwise defined herein have the meanings assigned to
them in
accordance with generally accepted accounting
principles;
|
|
(iii)
|
references
herein to “Articles,” “Sections,” “Subsections,” “Paragraphs,” and other
subdivisions without reference to a document are designated Articles,
Sections, Subsections, Paragraphs and other subdivisions of this
Agreement;
|
|
(iv)
|
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;
|
|
(v)
|
(he
words “herein,” “hereof,” “hereunder” and other words of similar import
refer to this Agreement as a whole and not to any particular provision;
and
|
31
|
(vi)
|
the
terms “include” or “including” shall mean without limitation by reason of
enumeration.
|
Section
12.10 Reproduction
of Documents .
This
Agreement and all documents relating thereto, including, without limitation,
(i)
consents, waivers and modifications which may hereafter be executed, (ii)
documents received by any party at the closing, and (iii) financial statements,
certificates and other information previously or hereafter furnished, may be
reproduced by any photographic, photostatic, microfilm, microcard, miniature
photographic or other similar process. The parties agree that any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding, whether or not the original is in
existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in
evidence.
Section
12.11 Successors
and Assigns.
The
provisions of this Agreement shall be binding upon and inure to the benefit
of
the respective successors and permitted assigns of the parties
hereto.
Section
12.12 Counterparts.
This
Agreement may be executed in several counterparts, each of which shall
constitute an original, but all of which together, shall constitute one
instrument notwithstanding that all parties are not signatories to the same
counterparts.
Section
12.13 Non-Solicitation
.
(a) From
and
after the Closing Date, the Servicer agrees that it will not take any action
or
cause any action to be taken by its agents to solicit the Mortgagor under any
Mortgage Loan to refinance a Mortgage Loan, in whole or in part, without the
prior written consent of Owner. It is understood and agreed that promotions
for
refinance undertaken by the Servicer or its agents that are directed to segments
of the general public, or to all or segments of the clients of Xxxxxx Xxxxxxx
Inc. and its affiliates which may include Mortgagors under any Mortgage Loan,
including, without limitation, directed marketing solicitations, newspaper,
radio and television advertisements, shall not constitute a solicitation under
the terms of this Agreement, provided that no segment shall consist exclusively
of such Mortgagors.
(b) From
and
after the Closing Date, Owner agrees that it will not take any action or cause
any action to be taken by its agents to solicit the Mortgagor under any Mortgage
Loan for any purpose, or otherwise directly contact any such Mortgagor, without
the prior written consent of the Servicer. It is understood and agreed that
promotions undertaken by Owner or its agents that are directed to segments
of
the general public, or to all or segments of the clients of Owner or its
affiliates, which may include Mortgagors under any Mortgage Loan, including,
without limitation, directed marketing solicitations, newspaper, radio and
television advertisements, shall not constitute a solicitation under the terms
of this Agreement, provided that no segment shall consist primarily of such
Mortgagors.
32
Section
12.14 Guaranty
of Owner’s Obligations.
Guarantor
hereby agrees to cause RWT Holdings, Inc. to perform all of its duties and
obligations as Owner hereunder, guaranties the timely performance of such duties
and obligations by RWT Holdings, Inc. and agrees to be jointly and severally
liable to Seller for all such duties and obligations of RWT Holdings,
Inc.
ARTICLE
XIII
COMPLIANCE
WITH REGULATION AB
Section
13.01 Intent
of the Parties; Reasonableness.
The
Owner
and the Servicer acknowledge and agree that the purpose of Article XIII of
this
Agreement is to facilitate compliance by the Owner and any Depositor with the
provisions of Regulation AB and related rules and regulations of the Commission.
Although Regulation AB is applicable by its terms only to offerings of
asset-backed securities that are registered under the Securities Act, the
Servicer acknowledges that investors in privately offered securities may require
that the Owner or any Depositor provide comparable disclosure in unregistered
offerings. References in this Agreement to compliance with Regulation AB include
provision of comparable disclosure in private offerings.
Neither
the Owner nor any Depositor shall exercise its right to request delivery of
information or other performance under these provisions other than in good
faith, or for purposes other than compliance with the Securities Act, the
Exchange Act and the rules and regulations of the Commission thereunder (or
the
provision in a private offering of disclosure comparable to that required under
the Securities Act). The Servicer acknowledges that interpretations of the
requirements of Regulation AB may change over time, whether due to interpretive
guidance provided by the Commission or its staff, consensus among participants
in the asset-backed securities markets, advice of counsel, or otherwise, and
agrees to comply with requests made by the Owner or any Depositor in good faith
for delivery of information under these provisions on the basis of evolving
interpretations of Regulation AB. In connection with any Securitization
Transaction, the Servicer shall cooperate fully with the Owner to deliver to
the
Owner (including any of its assignees or designees), any Master Servicer and
any
Depositor, any and all statements, reports, certifications, records and any
other information necessary in the good faith determination of the Owner, any
Master Servicer or any Depositor to permit the Owner, such Master Servicer
or
such Depositor to comply with the provisions of Regulation AB, together with
such disclosures relating to the Servicer, any Subservicer and the Mortgage
Loans, or the servicing of the Mortgage Loans, reasonably believed by the Owner
or any Depositor to be necessary in order to effect such
compliance.
The
Owner
(including any of its assignees or designees) shall cooperate with the Servicer
by providing timely notice of requests for information under these provisions
and by reasonably limiting such requests to information required, in the Owner’s
reasonable judgment, to comply with Regulation AB.
Section
13.02 Additional
Representations and Warranties of the Servicer.
33
(a) The
Servicer hereby represents to the Owner, to any Master Servicer and to any
Depositor, as of the date on which information is first provided to the Owner,
any Master Servicer or any Depositor under Section 13.03 that, except as
disclosed in writing to the Owner or such Depositor prior to such date: (i)
the
Servicer is not aware and has not received notice that any default, early
amortization or other performance triggering event has occurred as to any other
securitization due to any act or failure to act of the Servicer; (ii) the
Servicer has not been terminated as servicer in a residential mortgage loan
securitization, either due to a servicing default or to application of a
servicing performance test or trigger; (iii) no material noncompliance with
the
applicable servicing criteria with respect to other securitizations of
residential mortgage loans involving the Servicer has been disclosed or reported
by the Servicer; (iv) no material changes to the Servicer’s policies or
procedures with respect to the servicing function it will perform under this
Agreement and any Reconstitution Agreement for mortgage loans of a type similar
to the Mortgage Loans have occurred during the three-year period immediately
preceding the related Securitization Transaction; (v) there are no aspects
of
the Servicer’s financial condition that could have a material adverse effect on
the performance by the Servicer of its servicing obligations under this
Agreement or any Reconstitution Agreement; (vi) there are no material legal
or
governmental proceedings pending (or known to be contemplated) against the
Servicer or any Subservicer; and (vii) there are no affiliations, relationships
or transactions relating to the Servicer or any Subservicer with respect to
any
Securitization Transaction and any party thereto identified by the related
Depositor of a type described in Item 1119 of Regulation AB.
(b) If
so
requested by the Owner, any Master Servicer or any Depositor on any date
following the date on which information is first provided to the Owner, any
Master Servicer or any Depositor under Section 13.03, the Servicer shall, within
five Business Days following such request, confirm in writing the accuracy
of
the representations and warranties set forth in paragraph (a) of this Section
or, if any such representation and warranty is not accurate as of the date
of
such request, provide reasonably adequate disclosure of the pertinent facts,
in
writing, to the requesting party.
Section
13.03 Information
to Be Provided by the Servicer.
In
connection with any Securitization Transaction the Servicer shall (i) within
five Business Days following request by the Owner or any Depositor, provide
to
the Owner and such Depositor (or, as applicable, cause each Subservicer to
provide), in writing and in form and substance reasonably satisfactory to the
Owner and such Depositor, the information and materials specified in paragraphs
(a), (b) and (e) of this Section, and (ii) as promptly as practicable following
notice to or discovery by the Servicer, provide to the Owner and any Depositor
(in writing and in form and substance reasonably satisfactory to the Owner
and
such Depositor) the information specified in paragraph (d) of this
Section.
(a) If
so
requested by the Owner or any Depositor, the Servicer shall provide such
information regarding the Servicer, as servicer of the Mortgage Loans, and
each
Subservicer (each of the Servicer and each Subservicer, for purposes of this
paragraph, a “Servicer”), as is requested for the purpose of compliance with
Items 1108, 1117 and 1119 of Regulation AB. Such information shall include,
at a
minimum:
34
(A) the
Servicer’s form of organization;
(B) a
description of how long the Servicer has been servicing residential mortgage
loans; a general discussion of the Servicer’s experience in servicing assets of
any type as well as a more detailed discussion of the Servicer’s experience in,
and procedures for, the servicing function it will perform under this Agreement
and any Reconstitution Agreements; information regarding the size, composition
and growth of the Servicer’s portfolio of residential mortgage loans of a type
similar to the Mortgage Loans and information on factors related to the Servicer
that may be material, in the good faith judgment of the Owner or any Depositor,
to any analysis of the servicing of the Mortgage Loans or the related
asset-backed securities, as applicable, including, without
limitation:
|
(i)
|
whether
any prior securitizations of mortgage loans of a type similar to
the
Mortgage Loans involving the Servicer have defaulted or experienced
an
early amortization or other performance triggering event because
of
servicing during the three-year period immediately preceding the
related
Securitization Transaction;
|
|
(ii)
|
the
extent of outsourcing the Servicer
utilizes;
|
|
(iii)
|
whether
there has been previous disclosure of material noncompliance with
the
applicable servicing criteria with respect to other securitizations
of
residential mortgage loans involving the Servicer as a servicer during
the
three-year period immediately preceding the related Securitization
Transaction;
|
|
(iv)
|
whether
the Servicer has been terminated as servicer in a residential mortgage
loan securitization, either due to a servicing default or to application
of a servicing performance test or trigger;
and
|
|
(v)
|
such
other information as the Owner or any Depositor may reasonably request
for
the purpose of compliance with Item 1108(b)(2) of Regulation
AB;
|
(C) a
description of any material changes during the three-year period immediately
preceding the related Securitization Transaction to the Servicer’s policies or
procedures with respect to the servicing function it will perform under this
Agreement and any Reconstitution Agreements for mortgage loans of a type similar
to the Mortgage Loans;
(D) information
regarding the Servicer’s financial condition, to the extent that there is a
material risk that an adverse financial event or circumstance involving the
Servicer could have a material adverse effect on the performance by the Servicer
of its servicing obligations under this Agreement or any Reconstitution
Agreement;
(E) information
regarding advances made by the Servicer on the Mortgage Loans and the Servicer’s
overall servicing portfolio of residential mortgage loans for the three-year
period immediately preceding the related Securitization Transaction, which
may
be limited to a statement by an authorized officer of the Servicer to the effect
that the Servicer has made all advances required to be made on residential
mortgage loans serviced by it during such period, or, if such statement would
not be accurate, information regarding the percentage and type of advances
not
made as required, and the reasons for such failure to advance;
35
(F) a
description of the Servicer’s processes and procedures designed to address any
special or unique factors involved in servicing loans of a similar type as
the
Mortgage Loans;
(G) a
description of the Servicer’s processes for handling delinquencies, losses,
bankruptcies and recoveries, such as through liquidation of mortgaged
properties, sale of defaulted mortgage loans or workouts; and
(H) information
as to how the Servicer defines or determines delinquencies and charge-offs,
including the effect of any grace period, re-aging, restructuring, partial
payments considered current or other practices with respect to delinquency
and
loss experience.
(I) a
description of any material legal or governmental proceedings pending (or known
to be contemplated) against the Servicer; and
(J) a
description of any affiliation or relationship between the Servicer and any
of
the following parties to a Securitization Transaction, as such parties are
identified to the Servicer by the Owner or any Depositor in writing in advance
of such Securitization Transaction:
(1)
the
Sponsor;
(2)
the
Depositor;
(3)
the
issuing entity;
(4)
any
servicer;
(5)
any
trustee;
(6)
any
originator;
(7)
any
significant obligor;
(8)
any
enhancement or support provider; and
(9)
any
other material transaction party.
(b) For
the
purpose of satisfying the reporting obligations of an Owner, Master Servicer
or
Depositor under the Exchange Act with respect to any class of asset-backed
securities, the Servicer shall (or shall cause each Subservicer to) (i) provide
prompt notice to the Owner, any Master Servicer and any Depositor in writing
of
(A) any material litigation or governmental proceedings involving the Servicer,
any Subservicer, (B) any affiliations or relationships that develop following
the closing date of a Securitization Transaction between the Servicer, any
Subservicer and any of the parties specified in clause (J) of paragraph (a)
of
this Section (and any other parties identified in writing by the requesting
party) with respect to such Securitization Transaction, (C) any Event of Default
under the terms of this Agreement or any Reconstitution Agreement, (D) any
merger, consolidation or sale of substantially all of the assets of the
Servicer, and (E) the Servicer’s entry into an agreement with a Subservicer to
perform or assist in the performance of any of the Servicer’s obligations under
this Agreement or any Reconstitution Agreement, and (ii) provide to the Owner
and any Depositor a description of such proceedings, affiliations or
relationships.
36
(c) As
a
condition to the succession to the Servicer or any Subservicer as servicer
or
subservicer under this Agreement or any Reconstitution Agreement by any Person
(i) into which the Servicer or such Subservicer may be merged or consolidated,
or (ii) which may be appointed as a successor to the Servicer or any
Subservicer, the Servicer shall provide to the Owner, any Master Servicer and
any Depositor, at least 15 calendar days prior to the effective date of such
succession or appointment, (x) written notice to the Owner and any Depositor
of
such succession or appointment and (y) in writing and in form and substance
reasonably satisfactory to the Owner and such Depositor, all information
reasonably requested by the Owner or any Depositor in order to comply with
its
reporting obligation under Item 6.02 of Form 8-K with respect to any class
of
asset-backed securities.
(d) In
addition to such information as the Servicer, as servicer, is obligated to
provide pursuant to other provisions of this Agreement not later than ten days
prior to the deadline for the filing of any distribution report on Form 10-D
in
respect of any Securitization Transaction that includes any of the Mortgage
Loans serviced by the Servicer or any Subservicer, the Servicer or such
Subservicer, as applicable, shall, to the extent the Servicer or such
Subservicer has knowledge, provide to the party responsible for filing such
report (including, if applicable, the Master Servicer) notice of the occurrence
of any of the following events along with all information, data, and materials
related thereto as may be required to be included in the related distribution
report on Form 10-D (as specified in the provisions of Regulation AB referenced
below):
(i)
any
material modifications, extensions or waivers of pool asset terms, fees,
penalties or payments during the distribution period or that have cumulatively
become material over time (Item 1121(a)(11) of Regulation AB;
(ii)
material breaches of pool asset representations or warranties or transaction
covenants (Item 1121(a)(12) of Regulation AB; and
(e) The
Servicer shall provide to the Owner, any Master Servicer and any Depositor,
evidence of the authorization of the person signing any certification or
statement, copies or other evidence of Fidelity Bond Insurance and Errors and
Omission Insurance policy, financial information and reports, and such other
information related to the Servicer or any Subservicer or the Servicer’s or such
Subservicer’s performance hereunder.
Section
13.04 Annual
Statements as to Compliance.
On
or
before March 1 of each calendar year, commencing in 2007, the Servicer shall
deliver to the Owner, any Master Servicer and any Depositor a statement of
compliance addressed to the Owner, such Master Servicer and such Depositor
and
signed by an authorized officer of the Servicer, to the effect that (i) a review
of the Servicer’s activities during the immediately preceding calendar year (or
applicable portion thereof) and of its performance under this Agreement and
any
applicable Reconstitution Agreement during such period has been made under
such
officer’s supervision, and (ii) to the best of such officers’ knowledge, based
on such review, the Servicer has fulfilled all of its obligations under this
Agreement and any applicable Reconstitution Agreement in all material respects
throughout such calendar year (or applicable portion thereof) or, if there
has
been a failure to fulfill any such obligation in any material respect,
specifically identifying each such failure known to such officer and the nature
and the status thereof.
37
Section
13.05 Report
on Assessment of Compliance and Attestation.
On
or
before March 1 of each calendar year, commencing in 2007, the Servicer
shall:
|
(i)
|
deliver
to the Owner, any Master Servicer and any Depositor a report (in
form and
substance reasonably satisfactory to the Owner, such Master Servicer
and
such Depositor) regarding the Servicer’s assessment of compliance with the
Servicing Criteria during the immediately preceding calendar year,
as
required under Rules 13a-18 and 15d-18 of the Exchange Act and Item
1122
of Regulation AB. Such report shall be addressed to the Owner, such
Master
Servicer and such Depositor and signed by an authorized officer of
the
Servicer, and shall address each of the Servicing Criteria specified
on
Exhibit C;
|
|
(ii)
|
deliver
to the Owner, any Master Servicer and any Depositor a report of a
registered public accounting firm reasonably acceptable to the Owner,
such
Master Servicer and such Depositor that attests to, and reports on,
the
assessment of compliance made by the Servicer and delivered pursuant
to
the preceding paragraph. Such attestation shall be in accordance
with
Rules 1-02(a)(3) and 2-02(g) of Regulation S-X under the Securities
Act
and the Exchange Act;
|
|
(iii)
|
cause
each Subservicer, and each Subcontractor determined by the Servicer
pursuant to Section 13.06(b) to be “participating in the servicing
function” within the meaning of Item 1122 of Regulation AB, to deliver to
the Owner, any Master Servicer and any Depositor an assessment of
compliance and accountants’ attestation as and when provided in paragraphs
(a) and (b) of this Section; and
|
|
(iv)
|
if
requested by the Owner, any Master Servicer or any Depositor, deliver,
and
cause each Subservicer and Subcontractor as described in clause (iii)
to
provide, to the Owner, such Master Servicer and such Depositor and
any
other Person that will be responsible for signing the certification
(a
“Sarbanes Certification”) required by Rules 13a-14(d) and 15d-14(d) under
the Exchange Act (pursuant to Section 302 of the Xxxxxxxx-Xxxxx Act
of
2002) on behalf of an asset-backed issuer with respect to a Securitization
Transaction a certification in the form attached hereto as Exhibit
D.
|
38
The
Servicer acknowledges that the parties identified in clause (a)(iv) above may
rely on the certification provided by the Servicer pursuant to such clause
in
signing a Sarbanes Certification and filing such with the Commission. Neither
the Owner nor any Master Servicer nor any Depositor will request delivery of
a
certification under clause (a)(iv) above unless a Depositor is required under
the Exchange Act to file an annual report on Form 10-K with respect to an
issuing entity whose asset pool includes Mortgage Loans.
Each
assessment of compliance provided by a Subservicer pursuant to Section
13.05(a)(i) shall address each of the Servicing Criteria specified on a
certification substantially in the form of Exhibit C hereto delivered to the
Owner concurrently with the execution of this Agreement or, in the case of
a
Subservicer subsequently appointed as such, on or prior to the date of such
appointment. An assessment of compliance provided by a Subcontractor pursuant
to
Section 13.05(a)(iii) need not address any elements of the Servicing Criteria
other than those specified by the Servicer pursuant to Section
13.06.
Section
13.06 Use
of Subservicers and Subcontractors.
The
Servicer shall not hire or otherwise utilize the services of any Subservicer
to
fulfill any of the obligations of the Servicer as servicer under this Agreement
or any Reconstitution Agreement unless the Servicer complies with the provisions
of paragraph (a) of this Section. The Servicer shall not hire or otherwise
utilize the services of any Subcontractor, and shall not permit any Subservicer
to hire or otherwise utilize the services of any Subcontractor, to fulfill
any
of the obligations of the Servicer as servicer under this Agreement or any
Reconstitution Agreement unless the Servicer complies with the provisions of
paragraph (b) of this Section.
(a) It
shall
not be necessary for the Servicer to seek the consent of the Owner, any Master
Servicer or any Depositor to the utilization of any Subservicer. The Servicer
shall cause any Subservicer used by the Servicer (or by any Subservicer) for
the
benefit of the Owner and any Depositor to comply with the provisions of this
Section and with Sections 13.02, 13.03(a) and (c), 13.04, 13.05 and 13.07 of
this Agreement to the same extent as if such Subservicer were the Servicer,
and
to provide the information required with respect to such Subservicer under
Section 13.03(d) of this Agreement. The Servicer shall be responsible for
obtaining from each Subservicer and delivering to the Owner and any Depositor
any servicer compliance statement required to be delivered by such Subservicer
under Section 13.04, any assessment of compliance and attestation required
to be
delivered by such Subservicer under Section 13.05 and any certification required
to be delivered to the Person that will be responsible for signing the Sarbanes
Certification under Section 13.05 as and when required to be
delivered.
(b) It
shall
not be necessary for the Servicer to seek the consent of the Owner, any Master
Servicer or any Depositor to the utilization of any Subcontractor. The Servicer
shall promptly upon request provide to the Owner and any Depositor (or any
designee of the Depositor, such as a master servicer or administrator) a written
description (in form and substance satisfactory to the Owner and such Depositor)
of the role and function of each Subcontractor utilized by the Servicer or
any
Subservicer, specifying (i) the identity of each such Subcontractor, (ii) which
(if any) of such Subcontractors are “participating in the servicing function”
within the meaning of Item 1122 of Regulation AB, and (iii) which elements
of
the Servicing Criteria will be addressed in assessments of compliance provided
by each Subcontractor identified pursuant to clause (ii) of this
paragraph.
39
As
a
condition to the utilization of any Subcontractor determined to be
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB, the Servicer shall cause any such Subcontractor used by the
Servicer (or by any Subservicer) for the benefit of the Owner and any Depositor
to comply with the provisions of Sections 13.05 and 13.07 of this Agreement
to
the same extent as if such Subcontractor were the Servicer. The Servicer shall
be responsible for obtaining from each Subcontractor and delivering to the
Owner
and any Depositor any assessment of compliance and attestation or other
certifications required to be delivered by such Subcontractor under Section
13.05, in each case as and when required to be delivered.
Section
13.07 Indemnification;
Remedies.
(a) The
Servicer shall indemnify the Owner, each affiliate of the Owner, and each of
the
following parties participating in a Securitization Transaction: each Person
(including, but not limited to, any Master Servicer if applicable) responsible
for the preparation, execution or filing of any report required to be filed
with
Commission with respect to such Securitization Transaction, or for execution
of
a certification pursuant to Rule 13a-14d or Rule 15d-14d under the Exchange
Act
with respect to such Securitization Transaction, each sponsor and issuing
entity; each broker dealer acting as underwriter, placement agent or initial
purchaser, each Person who controls any of such parties or the Depositor (within
the meaning of Section 15 of the Securities Act and Section 20 of the Exchange
Act); and the respective present and former directors, officers, employees,
agents and affiliates of each of the foregoing and of the Depositor (each,
an
“Indemnified Party”), and shall hold each of them harmless from and against any
claims, losses, damages, penalties, fines, forfeitures, legal fees and expenses
and related costs, judgments, and any other costs, fees and expenses that any
of
them may sustain arising out of or based upon:
|
(i)
|
(A) any
untrue statement of a material fact contained or alleged to be contained
in any information, report, certification, data, accountants’ letter or
other material provided under this Article 13 by or on behalf of
the
Servicer, or provided under this Article 13 by or on behalf of any
Subservicer or Subcontractor (collectively, the “Servicer Information”),
or (B) the omission or alleged omission to state in the Servicer
Information a material fact required to be stated in the Servicer
Information or necessary in order to make the statements therein,
in the
light of the circumstances under which they were made, not misleading;
provided, by way of clarification, that clause (B) of this paragraph
shall
be construed solely by reference to the Servicer Information and
not to
any other information communicated in connection with a sale or purchase
of securities, without regard to whether the Servicer Information
or any
portion thereof is presented together with or separately from such
other
information;
|
|
(ii)
|
any
breach by the Servicer of its obligations under this Article XIII,
including any failure by the Servicer, any Subservicer or any
Subcontractor to deliver any information, report, certification,
accountants’ letter or other material when and as required under this
Article 13, including any failure by the Servicer to identify pursuant
to
Section 13.06(b) any Subcontractor “participating in the servicing
function” within the meaning of Item 1122 of Regulation AB;
|
40
|
(iii)
|
any
breach by the Servicer of a representation or warranty set forth
in
Section 13.02(a) or in a writing furnished pursuant to Section 13.02(b)
and made as of a date prior to the closing date of the related
Securitization Transaction, to the extent that such breach is not
cured by
such closing date, or any breach by the Servicer of a representation
or
warranty in a writing furnished pursuant to Section 13.02(b) to the
extent
made as of a date subsequent to such closing date;
or
|
|
(iv)
|
the
negligence, bad faith or willful misconduct of the Servicer in connection
with its performance under this Article
XIII.
|
If
the
indemnification provided for in this Section is unavailable or insufficient
to
hold harmless an Indemnified Party, then the Servicer agrees that it shall
contribute to the amount paid or payable by such Indemnified Party as a result
of any claims, losses, damages or liabilities incurred by such Indemnified
Party
in such proportion as is appropriate to reflect the relative fault of such
Indemnified Party on the one hand and the Servicer on the other.
In
the
case of any failure of performance described in clause (a)(ii) of this Section,
the Servicer shall promptly reimburse the Owner, any Depositor, as applicable,
and each Person responsible for the preparation, execution or filing of any
report required to be filed with the Commission with respect to such
Securitization Transaction, or for execution of a certification pursuant to
Rule
13a-14(d) or Rule 15d-14(d) under the Exchange Act with respect to such
Securitization Transaction, for all costs reasonably incurred by each such
party
in order to obtain the information, report, certification, accountants’ letter
or other material not delivered as required by the Servicer, any Subservicer
or
any Subcontractor.
This
indemnification shall survive the termination of this Agreement or the
termination of any party to this Agreement.
(b) (i) Any
failure by the Servicer, any Subservicer or any Subcontractor to deliver any
information, report, certification, accountants’ letter or other material when
and as required under this Article 13, or any breach by the Servicer of a
representation or warranty set forth in Section 13.02(a) or in a writing
furnished pursuant to Section 13.02(b) and made as of a date prior to the
closing date of the related Securitization Transaction, to the extent that
such
breach is not cured by such closing date, or any breach by the Servicer of
a
representation or warranty in a writing furnished pursuant to Section 13.02(b)
to the extent made as of a date subsequent to such closing date, shall, except
as provided in clause (ii) of this paragraph, immediately and automatically,
without notice or grace period, constitute an Event of Default with respect
to
the Servicer under this Agreement and any applicable Reconstitution Agreement,
and shall entitle the Owner or Depositor, as applicable, in its sole discretion
to terminate the rights and obligations of the Servicer as servicer under this
Agreement and/or any applicable Reconstitution Agreement without payment
(notwithstanding anything in this Agreement or any applicable Reconstitution
Agreement to the contrary) of any compensation to the Servicer; provided that
to
the extent that any provision of this Agreement and/or any applicable
Reconstitution Agreement expressly provides for the survival of certain rights
or obligations following termination of the Servicer as servicer, such provision
shall be given effect.
41
(ii) Any
failure by the Servicer, any Subservicer or any Subcontractor to deliver any
information, report, certification or accountants’ letter when and as required
under Section 13.04 or 13.05, including (except as provided below) any failure
by the Servicer to identify pursuant to Section 13.06(b) any Subcontractor
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB, which continues unremedied for ten calendar days after the date
on which such information, report, certification or accountants’ letter was
required to be delivered shall constitute an Event of Default with respect
to
the Servicer under this Agreement and any applicable Reconstitution Agreement,
and shall entitle the Owner or Depositor, as applicable, in its sole discretion
to terminate the rights and obligations of the Servicer as servicer under this
Agreement and/or any applicable Reconstitution Agreement without payment
(notwithstanding anything in this Agreement to the contrary) of any compensation
to the Servicer (and if the Servicer is servicing any of the Mortgage Loans
in a
Securitization Transaction, appoint a successor servicer reasonably acceptable
to any Master Servicer for such Securitization Transactin); provided that to
the
extent that any provision of this Agreement and/or any applicable Reconstitution
Agreement expressly provides for the survival of certain rights or obligations
following termination of the Servicer as servicer, such provision shall be
given
effect.
Neither
the Owner nor any Depositor shall be entitled to terminate the rights and
obligations of the Servicer pursuant to this subparagraph (b)(ii) if a failure
of the Servicer to identify a Subcontractor “participating in the servicing
function” within the meaning of Item 1122 of Regulation AB was attributable
solely to the role or functions of such Subcontractor with respect to mortgage
loans other than the Mortgage Loans.
(iii) The
Servicer shall promptly reimburse the Owner (or any designee of the Owner,
such
as a master servicer) and any Depositor, as applicable, for all reasonable
expenses incurred by the Owner (or such designee) or such Depositor, as such
are
incurred, in connection with the termination of the Servicer as servicer and
the
transfer of servicing of the Mortgage Loans to a successor servicer. The
provisions of this paragraph shall not limit whatever rights the Owner or any
Depositor may have under other provisions of this Agreement and/or any
applicable Reconstitution Agreement or otherwise, whether in equity or at law,
such as an action for damages, specific performance or injunctive
relief.
Section
13.08 Third
Party Beneficiary.
For
purposes of this Article XIII and any related provisions thereto, each Master
Servicer shall be considered a third party beneficiary of this Agreement,
entitled to all the rights and benefits hereof as if it were a party to this
Agreement.
42
IN
WITNESS WHEREOF, the parties have caused this Agreement to be executed by their
respective officers thereunto duly authorized as of the day and year first
set
forth above.
RWT
HOLDINGS, INC.
By::
____________________________
Name:
Title:
XXXXXX
XXXXXXX CREDIT CORPORATION
By:
____________________________
Name:
Title:
REDWOOD
TRUST, INC.
By:
____________________________
Name:
Title:
EXHIBIT
A
FORM
OF LIMITED POWER OF ATTORNEY
KNOW
ALL
MEN BY THESE PRESENTS that RWT Holdings, Inc. (“Owner”) having its principal
place of business at 000 Xxxxxxx Xxxxxxx, Xxxxx 0000, Xxxx Xxxxxx, Xxxxxxxxxx
00000, hereby constitutes and appoints Xxxxxx Xxxxxxx Credit Corporation (“the
Servicer”), a Delaware corporation having its principal place of business at
0000 Xxxx Xxxx Xxxx, Xxxxxxxxxx, Xxxxxxxx 00000, by and through any of its
Vice
Presidents or more senior officers, its true and lawful Attorney-in-Fact, in
its
name, place and stead and for its benefit, in connection with all residential
mortgage loans serviced by the Servicer for Owner for the purposes of performing
all acts and executing all documents in the name of Owner necessary and
incidental to servicing said loans, including but not limited to:
(1) Foreclosing
delinquent loans or discontinuing such foreclosure proceedings, executing claims
for insurance benefits under private mortgage insurance policies and endorsing
related proceeds checks made payable to Owner;
(2) Selling,
transferring or otherwise disposing of real property acquired through
foreclosure or otherwise, including but not limited to executing all contracts,
agreements, deeds, assignments or other instruments reasonably necessary or
advisable to effect such sale, transfer or disposition, and receiving proceeds
and endorsing checks made payable to the order of Owner from such
proceedings;
(3) Preparing,
executing and delivering satisfactions, cancellations, discharges, or full
or
partial releases of lien, subordination agreements, modification agreements,
assumption agreements, and substitutions of trustees under deeds of
trust;
(4) Endorsing
promissory notes and executing assignments of mortgages, deeds of trust, deeds
to secure debt and other security instruments securing said promissory notes
in
connection with loans for which the Servicer has received full payment of all
outstanding amounts due; and
(5) Any
and
all such other acts of any kind and nature whatsoever that are necessary and
prudent to service the loans.
Owner
further grants to the Servicer full power and authority to do and perform all
acts necessary for the Servicer to carry into effect the power or powers granted
by or under this Limited Power of Attorney as fully as Owner might or could
do
with the same validity as if all and every such act had been herein particularly
stated, expressed and especially provided for, and hereby ratifies and confirms
all that the Servicer shall lawfully have done, do, or cause to be done by
virtue of the powers and authority and contemplated hereby. This Limited Power
of Attorney shall be effective as of November 1, 2006.
A-1
Third
parties without actual notice may rely upon the exercise of the power granted
under this Limited Power of Attorney, and may be satisfied that this Limited
Power of Attorney shall continue in full force and effect until revoked in
writing by Owner. Third parties without actual notice may rely upon a
certificate to the effect set forth in the preceding sentence given by the
Servicer.
|
ATTEST
|
RWT
HOLDINGS, INC.
|
|
By:
___________________________________
|
By:
___________________________________
|
|
Name:
|
Name:
|
|
Title:
|
Title:
|
|
STATE
OF______________
|
)
|
|
) ss:
|
|
|
COUNTY
OF____________
|
)
|
On
the
__day of____, ____, before me, the undersigned, a Notary Public in and for
said
county and state, personally appeared _____________________ and
___________________, personally known to me to be the persons who executed
the
within instrument as _____________________ and ______________________,
respectively, on behalf of the corporation therein named, and they duly
severally acknowledged that they reside at __________________________________
and that said instrument is the act and deed of said corporation, and that
they,
being authorized to do so, executed and delivered said instrument and affixed
the corporate seal thereto for the purposes therein contained.
Witness
my hand and official seal:
Notary
Public State of _____________________
My
Commission Expires: __________________
A-2
EXHIBIT
B
FORM
OF MONTHLY SERVICER REPORT
B-1
EXHIBIT
C
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The
assessment of compliance to be delivered by [Xxxxxx Xxxxxxx Credit Corporation]
[Subservicer] shall address, at a minimum, the criteria identified as below
as
“Applicable Servicing Criteria”:
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
|
|
General
Servicing Considerations
|
||
|
1122(d)(1)(i)
|
Policies
and procedures are instituted to monitor any performance or other
triggers
and events of default in accordance with the transaction
agreements.
|
X
|
|
1122(d)(1)(ii)
|
If
any material servicing activities are outsourced to third parties,
policies and procedures are instituted to monitor the third party’s
performance and compliance with such servicing activities.
|
X
|
|
1122(d)(1)(iii)
|
Any
requirements in the transaction agreements to maintain a back-up
servicer
for the mortgage loans are maintained.
|
|
|
1122(d)(1)(iv)
|
A
fidelity bond and errors and omissions policy is in effect on the
party
participating in the servicing function throughout the reporting
period in
the amount of coverage required by and otherwise in accordance with
the
terms of the transaction agreements.
|
X
|
|
Cash
Collection and Administration
|
||
|
1122(d)(2)(i)
|
Payments
on mortgage loans are deposited into the appropriate custodial bank
accounts and related bank clearing accounts no more than two business
days
following receipt, or such other number of days specified in the
transaction agreements.
|
X
|
|
1122(d)(2)(ii)
|
Disbursements
made via wire transfer on behalf of an obligor or to an investor
are made
only by authorized personnel.
|
X
|
C-1
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
|
|
1122(d)(2)(iii)
|
Advances
of funds or guarantees regarding collections, cash flows or distributions,
and any interest or other fees charged for such advances, are made,
reviewed and approved as specified in the transaction
agreements.
|
X
|
|
1122(d)(2)(iv)
|
The
related accounts for the transaction, such as cash reserve accounts
or
accounts established as a form of overcollateralization, are separately
maintained (e.g., with respect to commingling of cash) as set forth
in the
transaction agreements.
|
X
|
|
1122(d)(2)(v)
|
Each
custodial account is maintained at a federally insured depository
institution as set forth in the transaction agreements. For purposes
of
this criterion, “federally insured depository institution” with respect to
a foreign financial institution means a foreign financial institution
that
meets the requirements of Rule 13k-1(b)(1) of the Securities Exchange
Act.
|
X
|
|
1122(d)(2)(vi)
|
Unissued
checks are safeguarded so as to prevent unauthorized
access.
|
X
|
|
1122(d)(2)(vii)
|
Reconciliations
are prepared on a monthly basis for all asset-backed securities related
bank accounts, including custodial accounts and related bank clearing
accounts. These reconciliations are (A) mathematically accurate;
(B)
prepared within 30 calendar days after the bank statement cutoff
date, or
such other number of days specified in the transaction agreements;
(C)
reviewed and approved by someone other than the person who prepared
the
reconciliation; and (D) contain explanations for reconciling items.
These
reconciling items are resolved within 90 calendar days of their original
identification, or such other number of days specified in the transaction
agreements.
|
X
|
|
Investor
Remittances and Reporting
|
||
C-2
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
|
|
1122(d)(3)(i)
|
Reports
to investors, including those to be filed with the Commission, are
maintained in accordance with the transaction agreements and applicable
Commission requirements. Specifically, such reports (A) are prepared
in
accordance with timeframes and other terms set forth in the transaction
agreements; (B) provide information calculated in accordance with
the
terms specified in the transaction agreements; (C) are filed with
the
Commission as required by its rules and regulations; and (D) agree
with
investors’ or the trustee’s records as to the total unpaid principal
balance and number of mortgage loans serviced by the
Servicer.
|
X
|
|
1122(d)(3)(ii)
|
Amounts
due to investors are allocated and remitted in accordance with timeframes,
distribution priority and other terms set forth in the transaction
agreements.
|
X
|
|
1122(d)(3)(iii)
|
Disbursements
made to an investor are posted within two business days to the Servicer’s
investor records, or such other number of days specified in the
transaction agreements.
|
X
|
|
1122(d)(3)(iv)
|
Amounts
remitted to investors per the investor reports agree with cancelled
checks, or other form of payment, or custodial bank
statements.
|
X
|
|
Pool
Asset Administration
|
||
|
1122(d)(4)(i)
|
Collateral
or security on mortgage loans is maintained as required by the transaction
agreements or related mortgage loan documents.
|
X
|
|
1122(d)(4)(ii)
|
Mortgage
loan and related documents are safeguarded as required by the transaction
agreements
|
X
|
|
1122(d)(4)(iii)
|
Any
additions, removals or substitutions to the asset pool are made,
reviewed
and approved in accordance with any conditions or requirements in
the
transaction agreements.
|
X
|
C-3
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
|
|
1122(d)(4)(iv)
|
Payments
on mortgage loans, including any payoffs, made in accordance with
the
related mortgage loan documents are posted to the Servicer’s obligor
records maintained no more than two business days after receipt,
or such
other number of days specified in the transaction agreements, and
allocated to principal, interest or other items (e.g., escrow) in
accordance with the related mortgage loan documents.
|
X
|
|
1122(d)(4)(v)
|
The
Servicer’s records regarding the mortgage loans agree with the Servicer’s
records with respect to an obligor’s unpaid principal
balance.
|
X
|
|
1122(d)(4)(vi)
|
Changes
with respect to the terms or status of an obligor’s mortgage loans (e.g.,
loan modifications or re-agings) are made, reviewed and approved
by
authorized personnel in accordance with the transaction agreements
and
related pool asset documents.
|
X
|
|
1122(d)(4)(vii)
|
Loss
mitigation or recovery actions (e.g., forbearance plans, modifications
and
deeds in lieu of foreclosure, foreclosures and repossessions, as
applicable) are initiated, conducted and concluded in accordance
with the
timeframes or other requirements established by the transaction
agreements.
|
X
|
|
1122(d)(4)(viii)
|
Records
documenting collection efforts are maintained during the period a
mortgage
loan is delinquent in accordance with the transaction agreements.
Such
records are maintained on at least a monthly basis, or such other
period
specified in the transaction agreements, and describe the entity’s
activities in monitoring delinquent mortgage loans including, for
example,
phone calls, letters and payment rescheduling plans in cases where
delinquency is deemed temporary (e.g., illness or
unemployment).
|
X
|
|
1122(d)(4)(ix)
|
Adjustments
to interest rates or rates of return for mortgage loans with variable
rates are computed based on the related mortgage loan
documents.
|
X
|
C-4
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
|
|
1122(d)(4)(x)
|
Regarding
any funds held in trust for an obligor (such as escrow accounts):
(A) such
funds are analyzed, in accordance with the obligor’s mortgage loan
documents, on at least an annual basis, or such other period specified
in
the transaction agreements; (B) interest on such funds is paid, or
credited, to obligors in accordance with applicable mortgage loan
documents and state laws; and (C) such funds are returned to the
obligor
within 30 calendar days of full repayment of the related mortgage
loans,
or such other number of days specified in the transaction
agreements.
|
X
|
|
1122(d)(4)(xi)
|
Payments
made on behalf of an obligor (such as tax or insurance payments)
are made
on or before the related penalty or expiration dates, as indicated
on the
appropriate bills or notices for such payments, provided that such
support
has been received by the servicer at least 30 calendar days prior
to these
dates, or such other number of days specified in the transaction
agreements.
|
X
|
|
1122(d)(4)(xii)
|
Any
late payment penalties in connection with any payment to be made
on behalf
of an obligor are paid from the servicer’s funds and not charged to the
obligor, unless the late payment was due to the obligor’s error or
omission.
|
X
|
|
1122(d)(4)(xiii)
|
Disbursements
made on behalf of an obligor are posted within two business days
to the
obligor’s records maintained by the servicer, or such other number of days
specified in the transaction agreements.
|
X
|
|
1122(d)(4)(xiv)
|
Delinquencies,
charge-offs and uncollectible accounts are recognized and recorded
in
accordance with the transaction agreements.
|
X
|
|
1122(d)(4)(xv)
|
Any
external enhancement or other support, identified in Item 1114(a)(1)
through (3) or Item 1115 of Regulation AB, is maintained as set forth
in
the transaction agreements.
|
[XXXXXX
XXXXXXX CREDIT CORPORATION]
[SUBSERVICER]
Date:
C-5
EXHIBIT
D
FORM
OF ANNUAL CERTIFICATION
|
Re:
|
The
[ ] agreement dated as of
[ l, 200[ ] (the
“Agreement”), among [IDENTIFY
PARTIES]
|
I,
_____________________________________, the _______________________ of [NAME
OF
SERVICER] and, in such capacity, the officer in charge of the Servicer’s
responsibility on Exhibit D to the Agreement. I hereby certify to [the
Purchaser], [the Depositor], and the [Master Servicer], and their officers,
with
the knowledge and intent that they will rely upon this certification,
that:
(A) I
have
reviewed the servicer compliance statement of the Servicer provided in
accordance with Item 1123 of Regulation AB (the “Compliance Statement”), the
report on assessment of the Servicer’s compliance with the servicing criteria
set forth in Item 1122(d) of Regulation AB (the “Servicing Criteria”), provided
in accordance with Rules 13a-18 and 15d-18 under Securities Exchange Act of
1934, as amended (the “Exchange Act”) and Item 1122 of Regulation AB (the
“Servicing Assessment”), the registered public accounting firm’s attestation
report provided in accordance with Rules 13a-18 and 15d-18 under the Exchange
Act and Section 1122(b) of Regulation AB (the “Attestation Report”), and all
other data, servicing reports, officer’s certificates and other information
relating to the performance of the Servicer under the terms of the Agreement
and
the servicing of the Mortgage Loans by the Servicer during 200[ ] that were
delivered to the [Depositor] [Master Servicer] pursuant to the Agreement to
the
extent included in any Form 8-Ks, Form 10-Ds, Form 10-Ks or similar forms
required by the Commission from time to time for the period covered by the
Compliance Statement (collectively, the “Servicer Servicing
Information”);
(B) Based
on
my knowledge, the reports and information comprising the Servicer Servicing
Information, taken as a whole, does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in the light of the circumstances under which such statements were made,
not misleading as of the period covered by, or the date of such reports or
information or the date of this certification;
(C) Based
on
my knowledge, all of the Servicer Servicing Information required to be provided
by the Servicer under the Agreement has been provided to the [Depositor] [Master
Servicer];
(D) I
am
responsible for reviewing the activities performed by the Servicer as servicer
under the Agreement, and based on my knowledge and the compliance review
conducted in preparing the Compliance Statement and except as disclosed in
the
Compliance Statement, the Servicing Assessment or the Attestation Report, the
Servicer has fulfilled its obligations under the Agreement in all material
respects; and
D-1
(E) The
Compliance Statement required to be delivered by the Servicer pursuant to the
Agreement, and the Servicing Assessment and Attestation Report required to
be
provided by the Servicer and by any Subservicer or Subcontractor pursuant to
the
Agreement, have been provided to the [Depositor] [Master Servicer]. The
Servicing Assessment and the Attestation Report cover all items of the servicing
criteria identified on Exhibit C to the Agreement as applicable to the Servicer.
Any material instances of noncompliance described in such reports have been
disclosed to the [Depositor] [Master Servicer]. Any material instance of
noncompliance with the Servicing Criteria has been disclosed in such reports.
The following material instances of noncompliance identified in the Servicing
Assessment and the Attestation Report relate to the performance or obligations
of the Servicer under the Agreement: ____________ (if none, state
“None.”)
Date:
_________________________
By: ________________________
Name:
Title:
D-2
XXXXXX
- SEQUOIA TO TRUSTEE
ASSIGNMENT,
ASSUMPTION AND RECOGNITION AGREEMENT
For
THIS
ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT, dated as of August 30, 2007
(“Assignment No. II”), is entered into among Sequoia Residential Funding, Inc.
(the “Assignor”), Xxxxxx Xxxxxxx Credit Corporation, as the servicer (the
“Servicer”), and HSBC Bank USA, National Association (“HSBC Bank”) as Trustee
under a Pooling and Servicing Agreement dated as of August 1, 2007 (the “Pooling
and Servicing Agreement”), among the Assignor, as Depositor, HSBC Bank (in such
Trustee capacity, the “Assignee”) and Xxxxx Fargo Bank, N. A., as Master
Servicer and Securities Administrator.
RECITALS
WHEREAS,
RWT Holdings, Inc. (“RWT”) and the Servicer have entered into a certain Master
Servicing Agreement, dated as of November 1, 2006 (as amended or modified to
the
date hereof, the “Master Servicing Agreement”), and the Servicer is currently
servicing certain mortgage loans (the “Mortgage Loans”) under the Master
Servicing Agreement; and
WHEREAS,
RWT has previously sold, assigned and transferred all of its right, title and
interest in certain of the Mortgage Loans (the “Specified Mortgage Loans”) which
are listed on the mortgage loan schedule attached as Exhibit
I
hereto
(the “Specified Mortgage Loan Schedule”) and its rights under the Master
Servicing Agreement with respect to the Specified Mortgage Loans to Assignor;
and
WHEREAS,
the Assignor has agreed to sell, assign and transfer to Assignee all of its
right, title and interest in the Specified Mortgage Loans and its rights under
the Master Servicing Agreement with respect to the Specified Mortgage Loans;
and
WHEREAS,
the parties hereto have agreed that the Specified Mortgage Loans shall be
subject to the terms of this Assignment No. II.
NOW,
THEREFORE, in consideration of the mutual promises contained herein and other
good and valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), the parties agree as follows:
1. Assignment
and Assumption.
(a) Effective
on and as of the date hereof, the Assignor hereby pledges, assigns and transfers
to the Assignee all of its right, title and interest in the Specified Mortgage
Loans and all of its rights (but none of the Owner’s obligations) provided under
the Master Servicing Agreement to the extent relating to the Specified Mortgage
Loans, the Assignee hereby accepts such assignment from the Assignor, and the
Servicer hereby acknowledges such assignment and assumption.
D-3
(b) Effective
on and as of the date hereof, the Assignor represents and warrants to the
Assignee that the Assignor has not taken any action that would serve to impair
or encumber the Assignee’s interest in the Specified Mortgage Loans since the
date of the Assignor’s acquisition of the Specified Mortgage Loans.
2. Recognition
of the Assignee.
From
and
after the date hereof, the Servicer shall recognize the Assignee as the holder
of the rights and benefits of the Owner with respect to the Specified Mortgage
Loans and the Servicer will service the Specified Mortgage Loans for the
Assignee as if the Assignee and the Servicer had entered into a separate
servicing agreement for the servicing of the Specified Mortgage Loans in the
form of the Master Servicing Agreement (as modified by Appendix A hereto) (the
“Successor MSA”) with the Assignee as the Owner thereunder, which Successor MSA
is incorporated in and made a part of this Assignment No. II. It is the
intention of the parties hereto that the Successor MSA will be treated as a
separate and distinct servicing agreement between the parties hereto to the
extent of the Specified Mortgage Loans and shall be binding upon and for the
benefit of the respective successors and assigns of the parties
hereto.
3. Assignor’s
Continuing Rights and Responsibilities.
Notwithstanding
Sections 1 and 2 above, the parties hereto agree that the Assignor rather than
the Assignee shall have the ongoing rights and responsibilities of the Owner
under the following sections of the Master Servicing Agreement:
|
Section
|
Matter
|
|
4.01
|
(a)
Role
of the Servicer.
|
|
7.05,
1st¶
and
2nd¶
|
(b)
Owner’s
Right to Examine the Servicer Records.
|
|
8.01
|
(c)
The
Servicer Shall Provide Information as Reasonably
Required. |
|
9.01(a)
and (b)
|
(d)
Indemnification;
Third-Party Claims.
|
|
9.03
|
(e)
Limitation
on Liability of Servicer and Others.
|
|
12.03
|
(f)
Assignments.
|
|
12.13(b)
|
(g)
Non-Solicitation.
|
D-4
In
addition, the Servicer agrees to furnish to the Assignor and Master Servicer
copies of reports, notices, statements and other communications required to
be
delivered by the Servicer pursuant to any of the sections of the Master
Servicing Agreement referred to above and under the following sections, at
the
times therein specified:
|
Section
|
|
|
4.11,
5th
and
6th¶’s
|
(a) Title
Management and Disposition of REO Property.
|
|
6.02
|
(b) Statements
to Owner.
|
|
6.03(d)
|
(c) Monthly
Advances by the Servicer.
|
|
13.04
|
(d)
Annual Statement as to Compliance
|
|
13.05
|
(e)
Report on Assessment of Compliance and Attestation
|
4. Successor
MSA.
The
Successor MSA includes the Master Servicing Agreement as modified by Appendix
A
hereto and is made a part of this Assignment No. II.
5. Representations
and Warranties.
(a) Each
of
the parties hereto represents and warrants that it is duly and legally
authorized to enter into this Assignment No. II.
(b) Each
of
the parties hereto represents and warrants that this Assignment No. II has
been
duly authorized, executed and delivered by it and (assuming due authorization,
execution and delivery thereof by each of the other parties hereto) constitutes
its legal, valid and binding obligation, enforceable against it in accordance
with its terms, except as such enforcement may be limited by bankruptcy,
insolvency, reorganization or other similar laws affecting the enforcement
of
creditors’ rights generally and by general equitable principles (regardless of
whether such enforcement is considered in a proceeding in equity or at
law).
6. Continuing
Effect.
Except
as
contemplated hereby, the Master Servicing Agreement shall remain in full force
and effect in accordance with its terms.
7. Governing
Law.
This
Assignment No. II and the rights and obligations hereunder shall be governed
by
and construed in accordance with the internal laws of the State of
Illinois.
D-5
8. Notices.
Any
notices or other communications permitted or required under the Master Servicing
Agreement to be made to the Assignor and Assignee shall be made in accordance
with the terms of the Master Servicing Agreement and shall be sent to the
Assignor and Assignee as follows:
Sequoia
Residential Funding, Inc.
Xxx
Xxxxxxxxx Xxxxx, Xxxxx 000
Xxxx
Xxxxxx, XX 00000
HSBC
Bank
USA, National Association
000
Xxxxx
Xxxxxx
Xxx
Xxxx,
XX 00000
Attn:
Corporate Trust & Loan Agency
or
to
such other address as may hereafter be furnished by the Assignor or Assignee
to
the other parties in accordance with the provisions of the Master Servicing
Agreement.
9. Counterparts.
This
Assignment No. II may be executed in counterparts, each of which when so
executed shall be deemed to be an original and all of which when taken together
shall constitute one and the same instrument.
10. Definitions.
Any
capitalized term used but not defined in this Assignment No. II has the same
meaning as in the Master Servicing Agreement or the Master Mortgage Loan
Purchase Agreement referred to therein.
11. Master
Servicer.
The
Servicer hereby acknowledges that the Assignee has appointed Xxxxx Fargo Bank,
N. A. (the “Master Servicer”) to act as master servicer and securities
administrator under the Pooling and Servicing Agreement and hereby agrees to
treat all inquiries, instructions, authorizations and other communications
from
the Master Servicer as if the same had been received from the Assignee. The
Master Servicer, acting on behalf of the Assignee, shall have the rights of
the
Assignee as the Owner under the Successor MSA to enforce the obligations of
the
Servicer thereunder. Any notices or other communications permitted or required
under the Master Servicing Agreement to be made to the Assignee shall be made
in
accordance with the terms of the Master Servicing Agreement and shall be sent
to
the Master Servicer at the following address:
Xxxxx
Fargo Bank, N. A.
X.X.
Xxx 00
Xxxxxxxx,
Xxxxxxxx 00000
(or,
for overnight deliveries, 0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx
00000)
Attention:
Sequoia Mortgage Trust 2007-4
D-6
or
to
such other address as may hereafter be furnished by the Master Servicer to
Servicer. Any such notices or other communications permitted or required under
the Master Servicing Agreement may be delivered in electronic format unless
manual signature is required in which case a hard copy of such report or
communication shall be required.
The
Servicer further acknowledges that the Assignor has engaged the Master Servicer
to provide certain default administration and that the Master Servicer, acting
as agent of the Assignor, may exercise any of the rights of the Owner retained
by the Assignor in Section 3 above.
The
Servicer shall make all distributions under the Successor MSA, as they relate
to
the Specified Mortgage Loans, to the Master Servicer by wire transfer of
immediately funds to:
Xxxxx
Fargo Bank, NA
San
Francisco, CA
ABA#
000-000-000
Acct#
0000000000
Acct
Name: SAS Clearing
FFC:
53173800
[remainder
of page intentionally left blank]
D-7
IN
WITNESS WHEREOF, the parties hereto have executed this Assignment No. II the
day
and year first above written.
ASSIGNOR:
SEQUOIA
RESIDENTIAL FUNDING, INC.
By:____________________________________
Name:_________________________________
Title:__________________________________
ASSIGNEE:
HSBC
BANK
USA, NATIONAL
ASSOCIATION
By:____________________________________
Name:_________________________________
Title:__________________________________
SERVICER:
XXXXXX
XXXXXXX CREDIT CORPORATION
By:____________________________________
Name:_________________________________
Title:__________________________________
H:\SSS\Sequoia
2007-4\Xxxxxx Assignment Sequoia to Trustee.doc
D-8
EXHIBIT
I
APPENDIX
A
MASTER
SERVICING AGREEMENT
1. The
definition of Custodial Account is revised to read as follows:
“
‘Custodial Account’: The separate trust account or accounts created and
maintained pursuant to Section
4.04
of this
Agreement which shall be entitled “Xxxxxx Xxxxxxx Credit Corporation, in trust
for ‘HSBC Bank USA, National Association, as Trustee, under the Pooling
and Servicing Agreement dated as of August 1, 2007,’ or such other title as is
requested by the Owner.”
2. The
following is added to the end of the definition of Eligible
Account:
“In
addition, the Servicer covenants that within 30 days of any downgrade of
a
custodial account provider, Servicer will transfer the Custodial Account
funds
to another institution that has one of the two highest short-term ratings
of S&P.”
3.
The
definition of Escrow
Account is revised to read as follows:
“
‘Escrow
Account’: The separate trust account or accounts created and maintained pursuant
to Section
4.06
on which
shall be entitled “Xxxxxx Xxxxxxx Credit Corporation, as Servicer, in trust for
‘HSBC Bank USA, National Association, as Trustee, under the Pooling and
Servicing Agreement dated as of August 1, 2007,’ or such other title as is
requested by Owner.”
4. Section
4.18, second sentence is revised to read as follows:
“All
such
Permitted Investments shall be registered in the name of the Servicer or
its
nominee, and held in trust for HSBC Bank USA, National Association, as Trustee,
under the Pooling and Servicing Agreement dated August 1, 2007.”
5. The
following is added to the end of Section 4.18:
“Notwithstanding
anything to the contrary in this Agreement, for all Permitted Investments
rated
at least "A1/A+"(short/long) that have terms greater than 60 days, in the
event
of a downgrade of such Permitted Investment below "A1" (or "A+" if no short
term
rating) Servicer agrees to remove such Permitted Investment within 60 days
of
such downgrade. Servicer acknowledges and agrees that Servicer shall bear
any
losses incurred with respect to removal of such Permitted Investment following
such a downgrade and that any losses shall be immediately deposited by the
Servicer in the Custodial Account, as appropriate, out of the Servicer’s own
funds, with no right to reimbursement therefore.”
6. Notwithstanding
any provision in the Agreement to the contrary, the Servicer agrees that
it will
report to the Master Servicer on a monthly basis on the date specified therein
using the formats attached hereto as Exhibit 1.
7. The
third
full paragraph of Section 6.01 is hereby deleted in its entirety and replaced
by
the following (second
deleted
in two places before Business Day):
“With
respect to any remittance received by Owner on or after the Business Day
following the Business Day on which such payment was due, the Servicer shall
pay
to Owner interest on any such late payment at an annual rate equal to the
rate
of interest as is publicly announced from time to time at its principal office
by Chase Manhattan Bank, N. A., New York, New York, as its “prime” lending rate
(which is not necessarily its lowest rate) (or if Chase Manhattan Bank, N.A.
shall cease to exist or to announce such rate, then such rate shall be a
reasonably comparable rate determined by Servicer in its reasonable discretion),
adjusted as of the date of each change, plus one (1) percentage point, but
in no
event greater than the maximum amount permitted by applicable law. Such interest
shall be paid by the Servicer to Owner on the date such late payment is made
and
shall cover the period commencing with the day following such Business Day
and
ending with the Business Day on which such payment is made, both inclusive.
Such
interest shall be remitted along with such late payment. The payment by the
Servicer of any such interest shall not be deemed an extension of time for
Payment or a waiver of any Event of Default by the Servicer.”
8. Section
10.01 is revised to add an “or” after 10.01(vi) and then to add the
following:
“failure
on the part of the Servicer to comply with Article XIII after the cure periods
provided in Section 13.07.”
9. Section
13.03 is revised to add the following after 13.03(d)(ii):
“(iii) information
regarding any Mortgage Loan changes (such as additions, substitutions, or
repurchases), and any material changes in origination, underwriting or other
criteria for acquisitions or selection of the Mortgage Loans (Item 1121(a)(14)
of Regulation AB).”
10. Section
13.05 is revised to delete the first line of 13.05(iv), so that 13.05(iv)
reads:
“deliver,
and cause each Subservicer and Subcontractor as described in clause (iii)
to
provide, to the Owner, such Master Servicer and such Depositor and any other
Person that will be responsible for signing the certification (a “Sarbanes
Certification”) required by Rules 13a-14(d) and 15d-14(d) under the Exchange Act
(pursuant to Section 302 of the Xxxxxxxx-Xxxxx Act of 2002) on behalf of
an
asset-backed issuer with respect to a Securitization Transaction a certification
in the form attached hereto as Exhibit D.”
11. The
first
paragraph under Section 13.07(b)(ii) is revised to read as follows (addition
is
in italics):
“(ii) Any
failure by the Servicer, any Subservicer or any Subcontractor to deliver
any
information, report, certification or accountants’ letter when and as required
under Section 13.04 or 13.05, including (except as provided below) any failure
by the Servicer to identify pursuant to Section 13.06(b) any Subcontractor
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB, which continues unremedied for ten calendar days after the
date
on which such information, report, certification or accountants’ letter was
required to be delivered shall constitute an Event of Default with respect
to
the Servicer under this Agreement and any applicable Reconstitution Agreement,
and shall entitle the Owner,
the
Master Servicer
or
Depositor, as applicable, in its sole discretion to terminate the rights
and
obligations of the Servicer as servicer under this Agreement and/or any
applicable Reconstitution Agreement without payment (notwithstanding anything
in
this Agreement to the contrary) of any compensation to the Servicer (and
if the
Servicer is servicing any of the Mortgage Loans in a Securitization Transaction,
appoint a successor servicer reasonably acceptable to any Master Servicer
for
such Securitization Transaction); provided that to the extent that any provision
of this Agreement and/or any applicable Reconstitution Agreement
expressl
EXHIBIT
1
12A.
FORM OF MONTHLY REPORTS
|
Standard
Loan Level File Layout - Master Servicing
|
|
|
|
|
|
|
|
|
||
|
Exhibit
1:
Layout
|
|
|
|
|
|
Column
Name
|
Description
|
Decimal
|
Format
Comment
|
Max
Size
|
|
Each
file requires the following fields:
|
|
|
|
|
|
SER_INVESTOR_NBR
|
A
value assigned by the Servicer to define a group of loans.
|
|
Text
up to 20 digits
|
20
|
|
LOAN_NBR
|
A
unique identifier assigned to each loan by the investor.
|
|
Text
up to 10 digits
|
10
|
|
SERVICER_LOAN_NBR
|
A
unique number assigned to a loan by the Servicer. This may be different
than the LOAN_NBR.
|
|
Text
up to 10 digits
|
10
|
|
SCHED_PAY_AMT
|
Scheduled
monthly principal and scheduled interest payment that a borrower
is
expected to pay, P&I constant.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
NOTE_INT_RATE
|
The
loan interest rate as reported by the Servicer.
|
4
|
Max
length of 6
|
6
|
|
NET_INT_RATE
|
The
loan gross interest rate less the service fee rate as reported by
the
Servicer.
|
4
|
Max
length of 6
|
6
|
|
SERV_FEE_RATE
|
The
servicer's fee rate for a loan as reported by the Servicer.
|
4
|
Max
length of 6
|
6
|
|
SERV_FEE_AMT
|
The
servicer's fee amount for a loan as reported by the Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
NEW_PAY_AMT
|
The
new loan payment amount as reported by the Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
NEW_LOAN_RATE
|
The
new loan rate as reported by the Servicer.
|
4
|
Max
length of 6
|
6
|
|
ARM_INDEX_RATE
|
The
index the Servicer is using to calculate a forecasted
rate.
|
4
|
Max
length of 6
|
6
|
|
ACTL_BEG_PRIN_BAL
|
The
borrower's actual principal balance at the beginning of the processing
cycle.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
ACTL_END_PRIN_BAL
|
The
borrower's actual principal balance at the end of the processing
cycle.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
BORR_NEXT_PAY_DUE_DATE
|
The
date at the end of processing cycle that the borrower's next payment
is
due to the Servicer, as reported by Servicer.
|
|
MM/DD/YYYY
|
10
|
|
SERV_CURT_AMT_1
|
The
first curtailment amount to be applied.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SERV_CURT_DATE_1
|
The
curtailment date associated with the first curtailment amount.
|
|
MM/DD/YYYY
|
10
|
|
CURT_ADJ_
AMT_1
|
The
curtailment interest on the first curtailment amount, if
applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SERV_CURT_AMT_2
|
The
second curtailment amount to be applied.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SERV_CURT_DATE_2
|
The
curtailment date associated with the second curtailment
amount.
|
|
MM/DD/YYYY
|
10
|
|
CURT_ADJ_
AMT_2
|
The
curtailment interest on the second curtailment amount, if
applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
Exhibit
1: Continued
|
Standard
Loan Level File Layout
|
|
|
|
|
Column
Name
|
Description
|
Decimal
|
Format
Comment
|
Max
Size
|
|
SERV_CURT_AMT_3
|
The
third curtailment amount to be applied.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SERV_CURT_DATE_3
|
The
curtailment date associated with the third curtailment
amount.
|
|
MM/DD/YYYY
|
10
|
|
CURT_ADJ_AMT_3
|
The
curtailment interest on the third curtailment amount, if
applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
PIF_AMT
|
The
loan "paid in full" amount as reported by the Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
PIF_DATE
|
The
paid in full date as reported by the Servicer.
|
|
MM/DD/YYYY
|
10
|
|
ACTION_CODE
|
The
standard FNMA numeric code used to indicate the default/delinquent
status
of a particular loan.
|
|
Action
Code Key: 15=Bankruptcy, 00xXxxxxxxxxxx, , 00xXXX, 63=Substitution,
65=Repurchase,70=REO
|
2
|
|
INT_ADJ_AMT
|
The
amount of the interest adjustment as reported by the
Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SOLDIER_SAILOR_ADJ_AMT
|
The
Soldier and Sailor Adjustment amount, if applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
NON_ADV_LOAN_AMT
|
The
Non Recoverable Loan Amount, if applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
LOAN_LOSS_AMT
|
The
amount the Servicer is passing as a loss, if applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
Plus
the following applicable fields:
|
|
|
|
|
|
SCHED_BEG_PRIN_BAL
|
The
scheduled outstanding principal amount due at the beginning of the
cycle
date to be passed through to investors.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SCHED_END_PRIN_BAL
|
The
scheduled principal balance due to investors at the end of a processing
cycle.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SCHED_PRIN_AMT
|
The
scheduled principal amount as reported by the Servicer for the current
cycle -- only applicable for Scheduled/Scheduled Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SCHED_NET_INT
|
The
scheduled gross interest amount less the service fee amount for the
current cycle as reported by the Servicer -- only applicable for
Scheduled/Scheduled Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
ACTL_PRIN_AMT
|
The
actual principal amount collected by the Servicer for the current
reporting cycle -- only applicable for Actual/Actual
Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
ACTL_NET_INT
|
The
actual gross interest amount less the service fee amount for the
current
reporting cycle as reported by the Servicer -- only applicable for
Actual/Actual Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
PREPAY_PENALTY_
AMT
|
The
penalty amount received when a borrower prepays on his loan as reported
by
the Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
PREPAY_PENALTY_
WAIVED
|
The
prepayment penalty amount for the loan waived by the
servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
Exhibit
1: Continued
|
Standard
Loan Level File Layout
|
|
|
|
|
Column
Name
|
Description
|
Decimal
|
Format
Comment
|
Max
Size
|
|
MOD_DATE
|
The
Effective Payment Date of the Modification for the loan.
|
|
MM/DD/YYYY
|
10
|
|
MOD_TYPE
|
The
Modification Type.
|
|
Varchar
- value can be alpha or numeric
|
30
|
|
DELINQ_P&I_ADVANCE_AMT
|
The
current outstanding principal and interest advances made by
Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
BREACH_FLAG
|
Flag
to indicate if the repurchase of a loan is due to a breach of
Representations and Warranties
|
Y=Breach
N=NO
Breach
Let
blank if N/A
|
1
|
Exhibit
12B : Standard
File Layout - Delinquency Reporting
*The
column/header names in bold
are
the minimum fields Xxxxx Fargo must receive from every
Servicer
|
Column/Header
Name
|
Description
|
Decimal
|
Format
Comment
|
||
|
SERVICER_LOAN_NBR
|
A
unique number assigned to a loan by the Servicer. This may be different
than the LOAN_NBR
|
|
|||
|
LOAN_NBR
|
A
unique identifier assigned to each loan by the originator.
|
|
|||
|
CLIENT_NBR
|
Servicer
Client Number
|
||||
|
SERV_INVESTOR_NBR
|
Contains
a unique number as assigned by an external servicer to identify a
group of
loans in their system.
|
|
|||
|
BORROWER_FIRST_NAME
|
First
Name of the Borrower.
|
||||
|
BORROWER_LAST_NAME
|
Last
name of the borrower.
|
||||
|
PROP_ADDRESS
|
Street
Name and Number of Property
|
|
|||
|
PROP_STATE
|
The
state where the property located.
|
|
|||
|
PROP_ZIP
|
Zip
code where the property is located.
|
|
|||
|
BORR_NEXT_PAY_DUE_DATE
|
The
date that the borrower's next payment is due to the servicer at the
end of
processing cycle, as reported by Servicer.
|
MM/DD/YYYY
|
|||
|
LOAN_TYPE
|
Loan
Type (i.e. FHA, VA, Conv)
|
|
|||
|
BANKRUPTCY_FILED_DATE
|
The
date a particular bankruptcy claim was filed.
|
MM/DD/YYYY
|
|||
|
BANKRUPTCY_CHAPTER_CODE
|
The
chapter under which the bankruptcy was filed.
|
|
|||
|
BANKRUPTCY_CASE_NBR
|
The
case number assigned by the court to the bankruptcy
filing.
|
|
|||
|
POST_PETITION_DUE_DATE
|
The
payment due date once the bankruptcy has been approved by the
courts
|
MM/DD/YYYY
|
|||
|
BANKRUPTCY_DCHRG_DISM_DATE
|
The
Date The Loan Is Removed From Bankruptcy. Either by Dismissal, Discharged
and/or a Motion For Relief Was Granted.
|
MM/DD/YYYY
|
|||
|
LOSS_MIT_APPR_DATE
|
The
Date The Loss Mitigation Was Approved By The Servicer
|
MM/DD/YYYY
|
|||
|
LOSS_MIT_TYPE
|
The
Type Of Loss Mitigation Approved For A Loan Such As;
|
||||
|
LOSS_MIT_EST_COMP_DATE
|
The
Date The Loss Mitigation /Plan Is Scheduled To End/Close
|
MM/DD/YYYY
|
|||
|
LOSS_MIT_ACT_COMP_DATE
|
The
Date The Loss Mitigation Is Actually Completed
|
MM/DD/YYYY
|
|||
|
FRCLSR_APPROVED_DATE
|
The
date DA Admin sends a letter to the servicer with instructions to
begin
foreclosure proceedings.
|
MM/DD/YYYY
|
|||
|
ATTORNEY_REFERRAL_DATE
|
Date
File Was Referred To Attorney to Pursue Foreclosure
|
MM/DD/YYYY
|
|||
|
FIRST_LEGAL_DATE
|
Notice
of 1st legal filed by an Attorney in a Foreclosure Action
|
MM/DD/YYYY
|
|||
|
FRCLSR_SALE_EXPECTED_DATE
|
The
date by which a foreclosure sale is expected to occur.
|
MM/DD/YYYY
|
|||
|
FRCLSR_SALE_DATE
|
The
actual date of the foreclosure sale.
|
MM/DD/YYYY
|
|||
|
FRCLSR_SALE_AMT
|
The
amount a property sold for at the foreclosure sale.
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
EVICTION_START_DATE
|
The
date the servicer initiates eviction of the borrower.
|
MM/DD/YYYY
|
|||
|
EVICTION_COMPLETED_DATE
|
The
date the court revokes legal possession of the property from the
borrower.
|
MM/DD/YYYY
|
|||
|
LIST_PRICE
|
The
price at which an REO property is marketed.
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
LIST_DATE
|
The
date an REO property is listed at a particular price.
|
MM/DD/YYYY
|
|||
|
OFFER_AMT
|
The
dollar value of an offer for an REO property.
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
OFFER_DATE_TIME
|
The
date an offer is received by DA Admin or by the Servicer.
|
MM/DD/YYYY
|
|||
|
REO_CLOSING_DATE
|
The
date the REO sale of the property is scheduled to close.
|
MM/DD/YYYY
|
|||
|
REO_ACTUAL_CLOSING_DATE
|
Actual
Date Of REO Sale
|
MM/DD/YYYY
|
|||
|
OCCUPANT_CODE
|
Classification
of how the property is occupied.
|
|
|||
|
PROP_CONDITION_CODE
|
A
code that indicates the condition of the property.
|
|
|||
|
PROP_INSPECTION_DATE
|
The
date a property inspection is performed.
|
MM/DD/YYYY
|
|||
|
APPRAISAL_DATE
|
The
date the appraisal was done.
|
MM/DD/YYYY
|
|||
|
CURR_PROP_VAL
|
The
current "as is" value of the property based on brokers price opinion
or
appraisal.
|
2
|
|
||
|
REPAIRED_PROP_VAL
|
The
amount the property would be worth if repairs are completed pursuant
to a
broker's price opinion or appraisal.
|
2
|
|
||
|
If
applicable:
|
|
|
|||
|
DELINQ_STATUS_CODE
|
FNMA
Code Describing Status of Loan
|
||||
|
DELINQ_REASON_CODE
|
The
circumstances which caused a borrower to stop paying on a loan. Code
indicates the reason why the loan is in default for this
cycle.
|
||||
|
MI_CLAIM_FILED_DATE
|
Date
Mortgage Insurance Claim Was Filed With Mortgage Insurance
Company.
|
MM/DD/YYYY
|
|||
|
MI_CLAIM_AMT
|
Amount
of Mortgage Insurance Claim Filed
|
No
commas(,) or dollar signs ($)
|
|||
|
MI_CLAIM_PAID_DATE
|
Date
Mortgage Insurance Company Disbursed Claim Payment
|
MM/DD/YYYY
|
|||
|
MI_CLAIM_AMT_PAID
|
Amount
Mortgage Insurance Company Paid On Claim
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
POOL_CLAIM_FILED_DATE
|
Date
Claim Was Filed With Pool Insurance Company
|
MM/DD/YYYY
|
|||
|
POOL_CLAIM_AMT
|
Amount
of Claim Filed With Pool Insurance Company
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
POOL_CLAIM_PAID_DATE
|
Date
Claim Was Settled and The Check Was Issued By The Pool
Insurer
|
MM/DD/YYYY
|
|||
|
POOL_CLAIM_AMT_PAID
|
Amount
Paid On Claim By Pool Insurance Company
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
FHA_PART_A_CLAIM_FILED_DATE
|
Date
FHA Part A Claim Was Filed With HUD
|
MM/DD/YYYY
|
|||
|
FHA_PART_A_CLAIM_AMT
|
Amount
of FHA Part A Claim Filed
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
FHA_PART_A_CLAIM_PAID_DATE
|
Date
HUD Disbursed Part A Claim Payment
|
MM/DD/YYYY
|
|||
|
FHA_PART_A_CLAIM_PAID_AMT
|
Amount
HUD Paid on Part A Claim
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
FHA_PART_B_CLAIM_FILED_DATE
|
Date
FHA Part B Claim Was Filed With HUD
|
MM/DD/YYYY
|
|||
|
FHA_PART_B_CLAIM_AMT
|
Amount
of FHA Part B Claim Filed
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
FHA_PART_B_CLAIM_PAID_DATE
|
Date
HUD Disbursed Part B Claim Payment
|
MM/DD/YYYY
|
|||
|
FHA_PART_B_CLAIM_PAID_AMT
|
Amount
HUD Paid on Part B Claim
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
VA_CLAIM_FILED_DATE
|
Date
VA Claim Was Filed With the Veterans Admin
|
MM/DD/YYYY
|
|||
|
VA_CLAIM_PAID_DATE
|
Date
Veterans Admin. Disbursed VA Claim Payment
|
MM/DD/YYYY
|
|||
|
VA_CLAIM_PAID_AMT
|
Amount
Veterans Admin. Paid on VA Claim
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
MOTION_FOR_RELIEF_DATE
|
The
date the Motion for Relief was filed
|
10
|
MM/DD/YYYY
|
||
|
FRCLSR_BID_AMT
|
The
foreclosure sale bid amount
|
11
|
No
commas(,) or dollar signs ($)
|
||
|
FRCLSR_SALE_TYPE
|
The
foreclosure sales results: REO, Third Party, Conveyance to
HUD/VA
|
|
|
||
|
REO_PROCEEDS
|
The
net proceeds from the sale of the REO property.
|
|
No
commas(,) or dollar signs ($)
|
||
|
BPO_DATE
|
The
date the BPO was done.
|
|
|
||
|
CURRENT_FICO
|
The
current FICO score
|
|
|
||
|
HAZARD_CLAIM_FILED_DATE
|
The
date the Hazard Claim was filed with the Hazard Insurance
Company.
|
10
|
MM/DD/YYYY
|
||
|
HAZARD_CLAIM_AMT
|
The
amount of the Hazard Insurance Claim filed.
|
11
|
No
commas(,) or dollar signs ($)
|
||
|
HAZARD_CLAIM_PAID_DATE
|
The
date the Hazard Insurance Company disbursed the claim
payment.
|
10
|
MM/DD/YYYY
|
|
|
HAZARD_CLAIM_PAID_AMT
|
The
amount the Hazard Insurance Company paid on the claim.
|
11
|
No
commas(,) or dollar signs ($)
|
|
|
ACTION_CODE
|
Indicates
loan status
|
Number
|
||
|
NOD_DATE
|
|
|
MM/DD/YYYY
|
|
|
NOI_DATE
|
|
|
MM/DD/YYYY
|
|
|
ACTUAL_PAYMENT_PLAN_START_DATE
|
|
|
MM/DD/YYYY
|
|
|
ACTUAL_PAYMENT_
PLAN_END_DATE
|
|
|
|
|
|
ACTUAL_REO_START_DATE
|
|
|
MM/DD/YYYY
|
|
|
REO_SALES_PRICE
|
|
|
Number
|
|
|
REALIZED_LOSS/GAIN
|
As
defined in the Servicing Agreement
|
|
Number
|
|
Exhibit
2: Standard
File Codes - Delinquency Reporting
The
Loss
Mit Type
field
should show the approved Loss Mitigation Code as follows:
|
·
|
ASUM-
|
Approved
Assumption
|
|
·
|
BAP-
|
Borrower
Assistance Program
|
|
·
|
CO-
|
Charge
Off
|
|
·
|
DIL-
|
Deed-in-Lieu
|
|
·
|
FFA-
|
Formal
Forbearance Agreement
|
|
·
|
MOD-
|
Loan
Modification
|
|
·
|
PRE-
|
Pre-Sale
|
|
·
|
SS-
|
Short
Sale
|
|
·
|
MISC-
|
Anything
else approved by the PMI or Pool
Insurer
|
NOTE:
Xxxxx Fargo Bank will accept alternative Loss Mitigation Types to those above,
provided that they are consistent with industry standards. If Loss Mitigation
Types other than those above are used, the Servicer must supply Xxxxx Fargo
Bank
with a description of each of the Loss Mitigation Types prior to sending the
file.
The
Occupant
Code
field should show the current status of the property code as
follows:
|
·
|
Mortgagor
|
|
·
|
Tenant
|
|
·
|
Unknown
|
|
·
|
Vacant
|
The
Property
Condition
field should show the last reported condition of the property as follows:
|
·
|
Damaged
|
|
·
|
Excellent
|
|
·
|
Fair
|
|
·
|
Gone
|
|
·
|
Good
|
|
·
|
Poor
|
|
·
|
Special
Hazard
|
|
·
|
Unknown
|
Exhibit
2: Standard
File Codes - Delinquency Reporting, Continued
The
FNMA
Delinquent Reason Code
field should show the Reason for Delinquency as follows:
|
Delinquency
Code
|
Delinquency
Description
|
|
001
|
FNMA-Death
of principal mortgagor
|
|
002
|
FNMA-Illness
of principal mortgagor
|
|
003
|
FNMA-Illness
of mortgagor’s family member
|
|
004
|
FNMA-Death
of mortgagor’s family member
|
|
005
|
FNMA-Marital
difficulties
|
|
006
|
FNMA-Curtailment
of income
|
|
007
|
FNMA-Excessive
Obligation
|
|
008
|
FNMA-Abandonment
of property
|
|
009
|
FNMA-Distant
employee transfer
|
|
011
|
FNMA-Property
problem
|
|
012
|
FNMA-Inability
to sell property
|
|
013
|
FNMA-Inability
to rent property
|
|
014
|
FNMA-Military
Service
|
|
015
|
FNMA-Other
|
|
016
|
FNMA-Unemployment
|
|
017
|
FNMA-Business
failure
|
|
019
|
FNMA-Casualty
loss
|
|
022
|
FNMA-Energy
environment costs
|
|
023
|
FNMA-Servicing
problems
|
|
026
|
FNMA-Payment
adjustment
|
|
027
|
FNMA-Payment
dispute
|
|
029
|
FNMA-Transfer
of ownership pending
|
|
030
|
FNMA-Fraud
|
|
031
|
FNMA-Unable
to contact borrower
|
|
INC
|
FNMA-Incarceration
|
Exhibit
2: Standard
File Codes - Delinquency Reporting, Continued
The
FNMA
Delinquent Status Code
field should show the Status of Default as follows:
|
Status
Code
|
Status
Description
|
|
09
|
Forbearance
|
|
17
|
Pre-foreclosure
Sale Closing Plan Accepted
|
|
24
|
Government
Seizure
|
|
26
|
Refinance
|
|
27
|
Assumption
|
|
28
|
Modification
|
|
29
|
Charge-Off
|
|
30
|
Third
Party Sale
|
|
31
|
Probate
|
|
32
|
Military
Indulgence
|
|
43
|
Foreclosure
Started
|
|
44
|
Deed-in-Lieu
Started
|
|
49
|
Assignment
Completed
|
|
61
|
Second
Lien Considerations
|
|
62
|
Veteran’s
Affairs-No Bid
|
|
63
|
Veteran’s
Affairs-Refund
|
|
64
|
Veteran’s
Affairs-Buydown
|
|
65
|
Chapter
7 Bankruptcy
|
|
66
|
Chapter
11 Bankruptcy
|
|
67
|
Chapter
13 Bankruptcy
|
Exhibit
12C: Calculation
of Realized Loss/Gain Form 332- Instruction Sheet
NOTE:
Do not net or combine items. Show all expenses individually and all credits
as
separate line items. Claim packages are due on the remittance report date.
Late
submissions may result in claims not being passed until the following month.
The
Servicer is responsible to remit all funds pending loss approval and /or
resolution of any disputed items.
(ii)
(iii)The
numbers on the 332 form correspond with the numbers listed below.
Liquidation
and Acquisition Expenses:
|
1.
|
The
Actual Unpaid Principal Balance of the Mortgage Loan. For documentation,
an Amortization Schedule from date of default through liquidation
breaking
out the net interest and servicing fees advanced is
required.
|
|
2.
|
The
Total Interest Due less the aggregate amount of servicing fee that
would
have been earned if all delinquent payments had been made as agreed.
For
documentation, an Amortization Schedule from date of default through
liquidation breaking out the net interest and servicing fees advanced
is
required.
|
|
3.
|
Accrued
Servicing Fees based upon the Scheduled Principal Balance of the
Mortgage
Loan as calculated on a monthly basis. For documentation, an Amortization
Schedule from date of default through liquidation breaking out the
net
interest and servicing fees advanced is
required.
|
|
4-12.
|
Complete
as applicable. Required
documentation:
|
*
For
taxes and insurance advances - see page 2 of 332 form - breakdown required
showing period
of
coverage, base tax, interest, penalty. Advances prior to default require
evidence of servicer efforts to recover advances.
*
For
escrow advances - complete payment history
(to
calculate advances from last positive escrow balance forward)
*
Other
expenses - copies of corporate advance history showing all payments
*
REO
repairs > $1500 require explanation
*
REO
repairs >$3000 require evidence of at least 2 bids.
*
Short
Sale or Charge Off require P&L supporting the decision and
WFB’s approved Officer Certificate
*
Unusual
or extraordinary items may require further documentation.
|
13.
|
The
total of lines 1 through 12.
|
|
(iv)
|
Credits:
|
|
14-21.
|
Complete
as applicable. Required
documentation:
|
*
Copy of
the HUD 1 from the REO sale. If a 3rd
Party
Sale, bid instructions and Escrow
Agent / Attorney
Letter
of
Proceeds
Breakdown.
*
Copy of
EOB for any MI or gov't guarantee
*
All
other credits need to be clearly defined on the 332
form
|
22.
|
The
total of lines 14 through 21.
|
|
Please
Note:
|
For
HUD/VA loans, use line (18a) for Part A/Initial proceeds and line
(18b)
for Part B/Supplemental proceeds.
|
Total
Realized Loss (or Amount of Any Gain)
|
23.
|
The
total derived from subtracting line 22 from 13. If the amount represents
a
realized gain, show the amount in parenthesis ( ).
|
Exhibit
3A: Calculation
of Realized Loss/Gain Form 332
Prepared
by:
__________________ Date:
_______________
Phone:
______________________ Email
Address:_____________________
|
|
|
|
||
|
Servicer
Loan No.
|
Servicer
Name
|
Servicer
Address
|
XXXXX
FARGO BANK, N.A. Loan No._____________________________
Borrower's
Name: _________________________________________________________
Property
Address: _________________________________________________________
Liquidation
Type: REO
Sale 3rd
Party
Sale Short
Sale Charge
Off
Was
this loan granted a Bankruptcy deficiency or
cramdown Yes No
If
“Yes”,
provide deficiency or cramdown amount
_______________________________
Liquidation
and Acquisition Expenses:
|
(1)
|
Actual
Unpaid Principal Balance of Mortgage Loan
|
$
______________
|
(1)
|
|
(2)
|
Interest
accrued at Net Rate
|
________________
|
(2)
|
|
(3)
|
Accrued
Servicing Fees
|
________________
|
(3)
|
|
(4)
|
Attorney's
Fees
|
________________
|
(4)
|
|
(5)
|
Taxes
(see page 2)
|
________________
|
(5)
|
|
(6)
|
Property
Maintenance
|
________________
|
(6)
|
|
(7)
|
MI/Hazard
Insurance Premiums (see page 2)
|
________________
|
(7)
|
|
(8)
|
Utility
Expenses
|
________________
|
(8)
|
|
(9)
|
Appraisal/BPO
|
________________
|
(9)
|
|
(10)
|
Property
Inspections
|
________________
|
(10)
|
|
(11)
|
FC
Costs/Other Legal Expenses
|
________________
|
(11)
|
|
(12)
|
Other
(itemize)
|
________________
|
(12)
|
|
Cash
for Keys__________________________
|
________________
|
(12)
|
|
|
HOA/Condo
Fees_______________________
|
________________
|
(12)
|
|
|
______________________________________
|
________________
|
(12)
|
|
|
Total
Expenses
|
$
_______________
|
(13)
|
|
|
Credits:
|
|||
|
(14)
|
Escrow
Balance
|
$
_______________
|
(14)
|
|
(15)
|
HIP
Refund
|
________________
|
(15)
|
|
(16)
|
Rental
Receipts
|
________________
|
(16)
|
|
(17)
|
Hazard
Loss Proceeds
|
________________
|
(17)
|
|
(18)
|
Primary
Mortgage Insurance / Gov’t Insurance
|
________________
|
(18a)
HUD Part A
|
|
________________
|
(18b)
HUD Part B
|
||
|
(19)
|
Pool
Insurance Proceeds
|
________________
|
(19)
|
|
(20)
|
Proceeds
from Sale of Acquired Property
|
________________
|
(20)
|
|
(21)
|
Other
(itemize)
|
________________
|
(21)
|
|
_________________________________________
|
________________
|
(21)
|
|
|
Total
Credits
|
$________________
|
(22)
|
|
|
Total
Realized Loss (or Amount of Gain)
|
$________________
|
(23)
|
|
Escrow Disbursement Detail
|
Type
(Tax
/Ins.)
|
Date
Paid
|
Period
of
Coverage
|
Total
Paid
|
Base
Amount
|
Penalties
|
Interest
|
|
|
||||||
|
|
||||||
|
|
||||||
|
|
||||||
|
|
||||||
|
|
||||||
|
|
||||||
|
|
