ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT
EXHIBIT
99.1
This
Assignment, Assumption and Recognition Agreement (the “AAR Agreement”) is made
and entered into as of January 31, 2006 (the “Closing Date”), among DB
Structured Products, Inc., having an address at 00 Xxxx Xxxxxx, Xxx Xxxx,
Xxx
Xxxx 00000 (the “Assignor”), Deutsche Alt-A Securities, Inc., having an address
at 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the “Assignee”), and National City
Mortgage Co., having an address at 0000 Xxxxxxx Xxxxx, Xxxxxxxxxx, Xxxx 00000
(the “Company” or the “Servicer”).
In
consideration of the mutual promises contained herein, the parties hereto
agree
that the residential mortgage loans listed on Attachment
1
annexed
hereto (the “Assigned Loans”), which are now serviced by the Company on behalf
of the Assignor and its successors and assigns pursuant to the Master
Seller’s Warranties and Servicing Agreement,
dated
as of January 1, 2005, as amended by Amendment Number One dated January 24,
2006, each between the Assignor and the Company (collectively, the “Servicing
Agreement”), shall be sold by the Assignor to the Assignee pursuant to the
Mortgage Loan Purchase Agreement, dated as of January 31, 2006 (the “MLPA”),
between the Assignor and the Assignee and subject to the terms of this AAR
Agreement. The Assignee intends to transfer all right, title and interest
in and
to the Assigned Loans to HSBC Bank USA, National Association, as trustee
(the
“Trustee”) for the holders of Deutsche Alt-A Securities, Inc. Mortgage Loan
Trust, Series 2006-AR1 Mortgage Pass-Through Certificates (the
“Certificateholders”) pursuant to the Pooling and Servicing Agreement, dated as
of January 1, 2006 (the “Pooling and Servicing Agreement”) among the Assignee,
as depositor, the Trustee and Xxxxx Fargo Bank, N.A., as master servicer
(the
“Master Servicer”) and as securities administrator. Capitalized terms used
herein but not defined shall have the meanings ascribed to them in the Servicing
Agreement.
Assignment
and Assumption
1.
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Assignor
hereby grants, transfers and assigns to Assignee all of the right,
title
and interest of Assignor in, to and under the Servicing Agreement
as it
relates to the servicing of the Assigned Loans. Assignor specifically
reserves and does not assign to Assignee any right, title and interest
in,
to or under the Servicing Agreement, as it relates to loans other
than the
Assigned Loans set forth on Attachment
1.
Notwithstanding anything to the contrary contained herein, the
Assignor
specifically reserves and does not assign to the Assignee any right,
title
and interest in, to or under Section 3.04 of the Servicing Agreement,
the
representations and warranties contained in Sections 3.01 and 3.02
of the
Servicing Agreement or the right to enforce the representations
and
warranties set forth in Article III of the Servicing Agreement
against the
Company.
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Representations,
Warranties and Covenants
2.
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Assignor
warrants and represents to Assignee and Company as of the Closing
Date:
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(a) Attached
hereto as Attachment
2
is a
true and accurate copy of the Servicing Agreement, which agreement is in
full
force and effect as of the Closing Date and the provisions of which have
not
been waived, amended or modified in any respect, nor has any notice of
termination been given thereunder;
(b) Assignor
was the lawful owner of the Assigned Loans with full right to transfer the
Assigned Loans and any and all of its interests, rights and obligations under
the Servicing Agreement as they relate to the Assigned Loans, free and clear
from any and all claims and encumbrances; and upon the transfer of the Assigned
Loans to Assignee under the MLPA, Assignee shall have good title to each
and
every Assigned Loan, as well as any and all of Assignor’s interests, rights and
obligations under the Servicing Agreement as they relate to the Assigned
Loans,
free and clear of any and all liens, claims and encumbrances;
(c) There
are
no offsets, counterclaims or other defenses available to Company with respect
to
the Assigned Loans or the Servicing Agreement;
(d) Assignor
has no knowledge of, and has not received notice of, any waivers under, or
any
modification of, any Assigned Loan;
(e) Assignor
is duly organized, validly existing and in good standing under the laws of
the
jurisdiction of its incorporation, and has all requisite power and authority
to
acquire, own and sell the Assigned Loans;
(f) Assignor
has full corporate power and authority to execute, deliver and perform its
obligations under this AAR Agreement, and to consummate the transactions
set
forth herein. The consummation of the transactions contemplated by this AAR
Agreement is in the ordinary course of Assignor’s business and will not conflict
with, or result in a breach of, any of the terms, conditions or provisions
of
Assignor’s certificate of incorporation or by-laws or any legal restriction, or
any material agreement or instrument to which Assignor is now a party or
by
which it is bound, or result in the violation of any law, rule, regulation,
order, judgment or decree to which Assignor or its property is subject. The
execution, delivery and performance by Assignor of this AAR Agreement and
the
consummation by it of the transactions contemplated hereby, have been duly
authorized by all necessary corporate action on the part of Assignor. This
AAR
Agreement has been duly executed and delivered by Assignor and, upon the
due
authorization, execution and delivery by Assignee and Company, will constitute
the valid and legally binding obligation of Assignor enforceable against
Assignor in accordance with its terms except as enforceability may be limited
by
bankruptcy, reorganization, insolvency, moratorium or other similar laws
now or
hereafter in effect relating to creditors’ rights generally, and by general
principles of equity regardless of whether enforceability is considered in
a
proceeding in equity or at law; and
(g) No
consent, approval, order or authorization of, or declaration, filing or
registration with, any governmental entity is required to be obtained or
made by
Assignor in connection with the execution, delivery or performance by Assignor
of this AAR Agreement, or the consummation by it of the transactions
contemplated hereby. Neither Assignor nor anyone acting on its behalf has
offered, transferred, pledged, sold or otherwise disposed of the Assigned
Loans
or any interest in the Assigned Loans, or solicited any offer to buy or accept
a
transfer, pledge or other disposition of the Assigned Loans, or any interest
in
the Assigned Loans or otherwise approached or negotiated with respect to
the
Assigned Loans, or any interest in the Assigned Loans with any Person in
any
manner, or made any general solicitation by means of general advertising
or in
any other manner, or taken any other action, which would constitute a
distribution of the Assigned Loans under the Securities Act of 1933, as amended
(the “1933 Act”)
or which
would render the disposition of the Assigned Loans a violation of Section
5 of
the 1933 Act or require registration pursuant thereto.
2
3.
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Assignee
warrants and represents to, and covenants with, Assignor and Company
as of
the Closing Date:
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(a) Assignee
is duly organized, validly existing and in good standing under the laws of
the
jurisdiction of its incorporation and has all requisite power and authority
to
acquire, own and purchase the Assigned Loans;
(b) Assignee
has full corporate power and authority to execute, deliver and perform its
obligations under this AAR Agreement, and to consummate the transactions
set
forth herein. The consummation of the transactions contemplated by this AAR
Agreement is in the ordinary course of Assignee’s business and will not conflict
with, or result in a breach of, any of the terms, conditions or provisions
of
Assignee’s certificate of incorporation or by-laws or any legal restriction, or
any material agreement or instrument to which Assignee is now a party or
by
which it is bound, or result in the violation of any law, rule, regulation,
order, judgment or decree to which Assignee or its property is subject. The
execution, delivery and performance by Assignee of this AAR Agreement and
the
consummation by it of the transactions contemplated hereby, have been duly
authorized by all necessary corporate action on the part of Assignee. This
AAR
Agreement has been duly executed and delivered by Assignee and, upon the
due
authorization, execution and delivery by Assignor and Company, will constitute
the valid and legally binding obligation of Assignee enforceable against
Assignee in accordance with its terms except as enforceability may be limited
by
bankruptcy, reorganization, insolvency, moratorium or other similar laws
now or
hereafter in effect relating to creditors’ rights generally, and by general
principles of equity regardless of whether enforceability is considered in
a
proceeding in equity or at law;
(c) No
consent, approval, order or authorization of, or declaration, filing or
registration with, any governmental entity is required to be obtained or
made by
Assignee in connection with the execution, delivery or performance by Assignee
of this AAR Agreement, or the consummation by it of the transactions
contemplated hereby; and
(d) Assignee
agrees to be bound by all of the terms, covenants and conditions of the
Servicing Agreement with respect to the Assigned Loans, and from and after
the
Closing Date, Assignee assumes for the benefit of each of Assignor and Company
all of Assignor’s obligations thereunder but solely with respect to such
Assigned Loans.
4.
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Company
warrants and represents to, and covenants with, Assignor and Assignee
(unless otherwise specified) as of the Closing
Date:
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(a) Attached
hereto as Attachment
2
is a
true and accurate copy of the Servicing Agreement, which agreement is in
full
force and effect as of the Closing Date and the provisions of which have
not
been waived, amended or modified in any respect, nor has any notice of
termination been given thereunder;
(b) Company
is duly organized, validly existing and in good standing under the laws of
the
jurisdiction of its incorporation, and has all requisite power and authority
to
service the Assigned Loans and otherwise to perform its obligations under
the
Servicing Agreement;
3
(c) Company
has full corporate power and authority to execute, deliver and perform its
obligations under this AAR Agreement, and to consummate the transactions
set
forth herein. The consummation of the transactions contemplated by this AAR
Agreement is in the ordinary course of Company’s business and will not conflict
with, or result in a breach of, any of the terms, conditions or provisions
of
Company’s certificate of incorporation or by-laws or any legal restriction, or
any material agreement or instrument to which Company is now a party or by
which
it is bound, or result in the violation of any law, rule, regulation, order,
judgment or decree to which Company or its property is subject. The execution,
delivery and performance by Company of this AAR Agreement and the consummation
by it of the transactions contemplated hereby, have been duly authorized
by all
necessary corporate action on the part of Company. This AAR Agreement has
been
duly executed and delivered by Company, and, upon the due authorization,
execution and delivery by Assignor and Assignee, will constitute the valid
and
legally binding obligation of Company, enforceable against Company in accordance
with its terms except as enforceability may be limited by bankruptcy,
reorganization, insolvency, moratorium or other similar laws now or hereafter
in
effect relating to creditors’ rights generally, and by general principles of
equity regardless of whether enforceability is considered in a proceeding
in
equity or at law;
(d) No
consent, approval, order or authorization of, or declaration, filing or
registration with, any governmental entity is required to be obtained or
made by
Company in connection with the execution, delivery or performance by Company
of
this AAR Agreement, or the consummation by it of the transactions contemplated
hereby; and
(e) From
and
after the Closing Date, the Company shall service the Assigned Loans in
accordance with the terms and provisions of the Servicing Agreement, as modified
by this AAR Agreement, and the Company shall establish a Custodial Account
and
an Escrow Account under the Servicing Agreement with respect to the Assigned
Loans separate from the Custodial Account and Escrow Account previously
established under the Servicing Agreement in favor of Assignor, and shall
remit
collections received. The Custodial Account and Escrow Account shall be entitled
“National City Mortgage Co., as servicer in trust for Deutsche Alt-A Securities,
Inc. Mortgage Loan Trust, Series 2006-AR1”.
5.
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Pursuant
to Section 7.01(c) of the Servicing Agreement, the Company hereby
restates
to the Assignor the representations and warranties set forth in
Subsections 3.01 and 3.02 of the Servicing Agreement as of the
Closing
Date, as if such representations and warranties were set forth
herein in
full, modified to the extant necessary to accurately reflect the
pool
statistics of the Assigned Loans as of the Closing Date. In the
event of a
breach of any such representations and warranties as of the Closing
Date,
the Assignor shall be entitled to all the remedies under the Servicing
Agreement.
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Recognition
of Assignee.
6.
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The
parties hereto acknowledge that Assignee will acquire the Assigned
Loans
for the purpose of assigning such Assigned Loans to the Trustee
for the
Trust, for the benefit of the related certificateholders on the
date
hereof. Assignor and Company hereby acknowledge and consent to
the
assignment by Assignee to the Trustee, on behalf of the Trust of
all of
Assignee’s rights against the Company and to the enforcement or exercise
of any right or remedy against the Company by Assignee. Such enforcement
of a right or remedy by the Master Servicer or the Trustee, on
behalf of
the Trust, shall have the same force and effect as if the right
or remedy
had been enforced or exercised by Assignee
directly.
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4
7.
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From
and after the Closing Date, Company shall recognize Assignee as
owner of
the Assigned Loans, and acknowledges that the Assigned Loans will
be part
of a REMIC, and will service the Assigned Loans in accordance with
the
Servicing Agreement, as modified by this AAR Agreement, but in
no event in
a manner that would (i) cause any REMIC to fail to qualify as a
REMIC or
(ii) result in the imposition of a tax upon any REMIC (including
but not
limited to the tax on prohibited transactions as defined in Section
860F(a)(2) of the Code and the tax on contributions to a REMIC
set forth
in Section 860G(d) of the Code). It is the intention of Assignor,
Company
and Assignee that this AAR Agreement shall be binding upon and
for the
benefit of the respective successors and assigns of the parties
hereto.
Neither Company nor Assignor shall amend or agree to amend, modify,
waive
or otherwise alter any of the terms or provisions of the Servicing
Agreement which amendment, modification, waiver or other alteration
would
in any way affect the Assigned Loans without the prior written
consent of
the Trustee and the Master Servicer. Company hereby acknowledges
that
pursuant to the Pooling and Servicing Agreement, the Assignee will
assign
all of its rights under this AAR Agreement to the Trustee for the
benefit
of the Certificateholders. Company hereby acknowledges and consents
to the
assignment by the Assignee of all of the Assignee’s rights against the
Company pursuant to this AAR Agreement and to the enforcement or
exercise
of any right or remedy against the Company pursuant to this AAR
Agreement
by the Trustee.
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Modification
of Servicing Agreement
8.
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The
Company and Assignor hereby modify the Servicing Agreement with
respect to
the Assigned Loans as follows:
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(a) The
definition of “Business Day” in Article I of the Servicing Agreement is amended
by inserting “, the State of New York, the State of Maryland or the State of
Minnesota” after “Ohio”.
(b) The
definition of “Master Servicer” is amended by deleting the definition in its
entirety and replacing it with the following:
Master
Servicer:
Xxxxx
Fargo Bank, N.A., its successors and assigns.
(c) The
definition of “Prepayment Interest Shortfall Amount” is amended by deleting the
definition in its entirety and replacing it with the following:
Prepayment
Interest Shortfall Amount:
With
respect to any Mortgage Loan that was subject to a Principal Prepayment in
full
or in part during any Due Period, which Principal Prepayment was applied
to such
Mortgage Loan prior to such Mortgage Loan’s Due Date in such Due Period, the
amount of interest (net the related Servicing Fee) that would have accrued
on
the amount of such Principal Prepayment during the period commencing on the
date
as of which such Principal Prepayment was applied to such Mortgage Loan and
ending on the day immediately preceding such Due Date, inclusive; provided,
however,
that in
no event shall the aggregate of deposits made by the Company pursuant to
the
foregoing clause exceed the aggregate amount of the Servicing Fee in the
calendar month in which such deposits are required.
5
(d) The
definition of “Remittance Date” in Article I of the Servicing Agreement is
amended by deleting the word “following” in the second line and replacing it
with the word “preceding”.
(e) The
definition of “Servicing Fee Rate” in Article I of the Servicing Agreement is
amended by deleting the definition in its entirety and replacing it with
the
following:
Servicing
Fee Rate:
The per
annum rate set forth on the Mortgage Loan Schedule at which the Servicing
Fee
accrues.
(f) The
following definitions are added to Article I of the Servicing
Agreement:
Nonrecoverable
Advance:
Any
Monthly Advance or Servicing Advance previously made or proposed to be made
in
respect of a Mortgage Loan or REO Property that, in the good faith business
judgment of the Company, will not, or, in the case of a proposed Monthly
Advance
or Servicing Advance, would not be ultimately recoverable from related late
payments, Insurance Proceeds or Liquidation Proceeds on such Mortgage Loan
or
REO Property as provided herein.
Trustee:
HSBC
Bank USA, National Association, a national banking association, or its successor
in interest, or successor trustee.
(g) Section
4.05 of the Servicing Agreement is modified by adding the word “and” at the end
of subpart (viii) and adding a new subpart (ix) following subpart (viii)
to read
in its entirety as follows:
(ix)
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to
reimburse the Company for any Monthly Advance or Servicing Advance
previously made which the Company has determined to be a Nonrecoverable
Advance.
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(h) Section
4.05 of the Servicing Agreement is further modified by replacing the roman
numeral “viii” in the last paragraph with the roman numeral “ix”.
(i) The
first
paragraph of Section 5.02 of the Servicing Agreement is deleted in its entirety
and replaced with the following:
“No
later
than the tenth (10th)
day of
each month (or if such tenth (10th)
day is
not a Business Day, the first Business Day immediately preceding such tenth
(10th)
day),
Company shall furnish to the Master Servicer, in an acceptable electronic
format
via e-mail, the information specified in Exhibit F, which data shall reflect
information from the Due Period immediately preceding the Remittance Date
and
such other information with respect to the Mortgage Loans as the Master Servicer
may reasonably require to allocate remittances made pursuant to this Agreement
and provide appropriate statements with respect to such
remittances.”
6
(j) Section
5.03 of the Servicing Agreement is modified by adding the following sentences
at
the end thereto:
“Notwithstanding
anything herein to the contrary, no Monthly Advance shall be required to
be made
hereunder by the Company if such Monthly Advance would, if made, constitute
a
Nonrecoverable Advance. The determination by the Company that it has made
a
Nonrecoverable Advance or that any proposed Monthly Advance, if made, would
constitute a Nonrecoverable Advance, shall be evidenced by a certification
signed by a Servicing Officer and delivered to the Master
Servicer.”
(k) Section
6.04 of the Servicing Agreement is deleted in its entirety and replaced with
the
following:
“Section
6.04 [Reserved.]”
(l) Section
6.05 of the Servicing Agreement is deleted in its entirety and replaced with
the
following:
“Section
6.05 [Reserved.]”
(m) Section
6.08 of the Servicing Agreement is modified by adding the following paragraph
at
the end thereof:
“The
Company shall not permit the creation of any “interests” (within the meaning of
Section 860G of the Code) in the REMIC. The Company shall not enter into
any
arrangement by which the REMIC will receive a fee or other compensation for
services nor permit the REMIC to receive any income from assets other than
“qualified mortgages” as defined in Section 860G(a)(3) of the Code or “permitted
investments” as defined in Section 860G(a)(5) of the Code.”
(n) Subpart
(d) of Section 7A.03 of the Servicing Agreement is modified by adding the
following before the words “and (ii)” in the last sentence of this
subpart:
“(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 Company, and (E) the Company’s entry into an agreement with a
Subservicer to perform or assist in the performance of any of the Company’s
obligations under this Agreement or any Reconstitution Agreement”
7
(o) Subpart
(e) of Section 7A.03 of the Servicing Agreement is modified by deleting the
words “5 Business Days” and replacing such words with “ten (10)
days”.
(p) Subpart
(f) of Section 7A.03 of the Servicing Agreement is
deleted in its entirety and replaced with the following:
“(f) In
addition to such information as the Company, as servicer, is obligated to
provide pursuant to other provisions of this Agreement, not later than ten
(10)
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 Company or any Subservicer, the Company or
such
Subservicer, as applicable, shall, to the extent the Company 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
(iii)
information regarding any pool asset changes (such as, additions, substitutions
or repurchases), and any material changes in origination, underwriting or
other
criteria used to originate pool assets (Item 1121(a)(14) of Regulation
AB).
(g)
The
Company shall provide to the Purchaser, any Material 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 Company or any Subservicer or the Company or such
Subservicer’s performance hereunder.”
(q) Section
7A.04 of the Servicing Agreement is amended by inserting “, any Master Servicer”
after the words “deliver to the Purchaser”.
(r) Subpart
(a)(i) of Section 7A.05 of the Servicing Agreement is amended by inserting
“,
any Master Servicer” after the words “satisfactory to the
Purchaser”.
(s) Subpart
(a)(ii) of Section 7A.05 of the Servicing Agreement is amended by inserting
“,
any Master Servicer” after the words “deliver to the Purchaser”.
8
(t) Subpart
(a)(iv) of Section 7A.05 of the Servicing Agreement is amended by inserting
“,
and cause each Subservicer and Subcontractor described in clause (iii) above
to
deliver,” after the word “deliver” in the first line of such
subpart.
(u) Subpart
(a) of Section 7A.06 of the Servicing Agreement is amended by deleting the
words
“7A.03 (c) and (e)” in such subpart and replacing such words with “7A.03 (c),
(e), (f) and (g)”.
(v) The
last
paragraph of Section 7A.06 of the Servicing Agreement is amended by inserting
“and any other certifications” after the words “any assessment of compliance and
attestation”.
(w) Subpart
(a)(ii) of Section 7A.07 of the Servicing Agreement is amended by inserting
the
words “any breach by the Company of its obligations under this Article 7A,
including particularly” at the beginning of such subpart.
(x) Section
7A.07 of the Servicing Agreement is amended by adding the following at the
end
thereto:
“If
the
indemnification provided for herein is unavailable or insufficient to hold
harmless an Indemnified Party, then the Company agrees that it shall contribute
to the amount paid or payable 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 Company on the other.
This
indemnification shall survive the termination of this Agreement or the
termination of any party to this Agreement.”
(y) Section
10.01(xi) of the Servicing Agreement is deleted in its entirety and replaced
with the following:
“(xi) the
Company fails to duly perform, within the required time period, its obligations
under Article 7A of this Agreement, which failure continues unremedied for
a
period of ten (10) days after the date on which written notice of such failure,
requiring the same to be remedied, shall have been given to the Company by
any
party to this Agreement or by any Master Servicer responsible for master
servicing any Mortgage Loans pursuant to a securitization of such Mortgage
Loans.”
(z) A
new
Section 12.21 shall be added to the Agreement to read in its entirety as
follows:
“Section
12.21. Third
Party Beneficiary.
For
purposes of this Agreement, including but not limited to Article 7A, the
Master
Servicer shall be considered a third party beneficiary to this Agreement
entitled to all the rights and benefits accruing to the Master Servicer herein
as if it were a direct party to this Agreement.”
9
(aa) Exhibit
F
of the Servicing Agreement is modified to include the information set forth
on
Attachment
3
hereto.
(bb) Exhibit
N
of the Servicing Agreement is amended by deleting such exhibit in its entirety
and replacing it with the form attached hereto as Attachment
4.
Miscellaneous
9.
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All
demands, notices and communications related to the Assigned Loans,
the
Servicing Agreement and this AAR Agreement shall be in writing
and shall
be deemed to have been duly given if personally delivered at or
mailed by
registered mail, postage prepaid, as follows:
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(a) In
the
case of Company,
National
City Mortgage Co.
0000
Xxxxxxx Xxxxx
Xxxxxxxxxx,
Xxxx 00000
Attention:
Xxxx Xxxx Xxxxxxxx
(b) In
the
case of Assignor,
DB
Structured Products, Inc.
00
Xxxx
Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Xxxxx Xxxxxxx
(c) In
the
case of Assignee,
Deutsche
Alt-A Securities, Inc.
c/o
Deutsche Bank Securities, Inc.
00
Xxxx
Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Xxxxx Xxxxxxx
(d) In
the
case of the Master Servicer,
Xxxxx
Fargo Bank, N.A.
0000
Xxx
Xxxxxxxxx Xxxx
Xxxxxxxx,
Xxxxxxxx 00000
Attention:
Client Manager - DBALT 2006-AR1
Telecopier:
(000) 000-0000
10.
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Each
party will pay any commissions it has incurred and the Assignor
shall pay
the fees of its attorneys and the reasonable fees of the attorneys
of the
Assignee and the Company in connection with the negotiations for,
documenting of and closing of the transactions contemplated by
this AAR
Agreement.
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10
11.
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The
Company hereby acknowledges that, Xxxxx Fargo Bank, N.A. has been
appointed as the Master Servicer of the Assigned Loans pursuant
to the
Pooling and Servicing Agreement and, therefore, has the right to
enforce
all obligations of the Company under the Servicing Agreement. Such
rights
will include, without limitation, the right to terminate the Company
under
the Servicing Agreement upon the occurrence of an Event of Default
thereunder, the right to receive all remittances required to be
made by
the Company under the Servicing Agreement, the right to receive
all
monthly reports and other data required to be delivered by the
Company
under the Servicing Agreement, the right to examine the books and
records
of the Company, indemnification rights and the right to exercise
certain
rights of consent and approval relating to actions taken by the
Company.
The Company shall make all distributions under the Servicing Agreement
to
the Master Servicer by wire transfer of immediately available funds
to:
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Xxxxx
Fargo Bank, N.A.
ABA
Number: 000000000
Account
Name: SAS Clearing
Account
Number: 0000000000
For
further credit to: DBALT 2006-AR1 Account # 00000000
The
Company shall deliver all reports required to be delivered under the Servicing
Agreement to the Assignee and to the Master Servicer at their respective
addresses set forth in Section 9 herein.
12.
|
This
AAR Agreement shall be construed in accordance with the laws of
the State
of New York, without regard to conflicts of law principles (other
than
Section 5-1401 of the General Obligations Law), and the obligations,
rights and remedies of the parties hereunder shall be determined
in
accordance with such laws.
|
13.
|
No
term or provision of this AAR Agreement may be waived or modified
unless
such waiver or modification is in writing and signed by the party
against
whom such waiver or modification is sought to be
enforced.
|
14.
|
This
AAR Agreement shall inure to the benefit of the successors and
assigns of
the parties hereto. Any entity into which Assignor, Assignee or
Company
may be merged or consolidated or which succeeds to the business
or assets
thereof shall, without the requirement for any further writing,
be deemed
Assignor, Assignee or Company, respectively,
hereunder.
|
15.
|
This
AAR Agreement shall survive the conveyance of the Assigned Loans,
the
assignment of the Servicing Agreement to the extent of the Assigned
Loans
by Assignor to Assignee and the termination of the Servicing
Agreement.
|
16.
|
This
AAR Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original
and all
such counterparts shall constitute one and the same
instrument.
|
11
17.
|
In
the event that any provision of this AAR Agreement conflicts with
any
provision of the Servicing Agreement with respect to the Assigned
Loans,
the terms of this AAR Agreement shall
control.
|
[SIGNATURE
PAGE FOLLOWS]
12
IN
WITNESS WHEREOF, the parties hereto have executed this AAR Agreement as of
the
day and year first above written.
DB
STRUCTURED PRODUCTS,
|
NATIONAL
CITY MORTGAGE CO.,
|
INC.,
Assignor
|
Company
|
By:
__________________________________
|
By:
__________________________________
|
Name:
|
Name:
|
Title:
|
Title:
|
By:
__________________________________
|
|
Name:
|
|
Title:
|
|
DEUTSCHE
ALT-A SECURITIES, INC.,
|
|
Assignee
|
|
By:
__________________________________
|
|
Name:
|
|
Title:
|
|
By:
__________________________________
|
|
Name:
|
|
Title:
|
|
ACKNOWLEDGED
AND AGREED TO:
|
|
XXXXX
FARGO BANK, N.A.,
|
|
Master
Servicer
|
|
By:
__________________________________
|
|
Name:
|
|
Title:
|
ATTACHMENT
1
ASSIGNED
LOANS
[PROVIDED
UPON REQUEST]
ATTACHMENT
2
SERVICING
AGREEMENT
DB
STRUCTURED PRODUCTS, INC.
Purchaser
and
NATIONAL
CITY MORTGAGE CO.,
Company
MASTER
SELLER’S WARRANTIES AND SERVICING AGREEMENT
Dated
as
of January 1, 2005
Conventional
Mortgage Loans
TABLE
OF
CONTENTS
Page
1
|
||
ARTICLE
II CONVEYANCE OF MORTGAGE LOANS; POSSESSION OF MORTGAGE FILES;
BOOKS AND
RECORDS; DELIVERY OF DOCUMENTS
|
13
|
|
Section
2.01
|
Conveyance
of Mortgage Loans; Possession of Mortgage Files; Maintenance
of Servicing
Files.
|
13
|
Section
2.02
|
Purchase
Price.
|
14
|
Section
2.03
|
Books
and Records; Transfers of Mortgage Loans.
|
15
|
Section
2.04
|
Delivery
of Documents
|
16
|
Section
2.05
|
Closing
Documents.
|
16
|
ARTICLE
III REPRESENTATIONS AND WARRANTIES; REMEDIES AND BREACH
|
18
|
|
Section
3.01
|
Company
Representations and Warranties.
|
18
|
Section
3.02
|
Representations
and Warranties Regarding Individual Mortgage Loans.
|
21
|
Section
3.03
|
Remedies
for Breach of Representations and Warranties.
|
33
|
Section
3.04
|
Repurchase
of Certain Mortgage Loans; Premium Recapture.
|
36
|
Section
3.05
|
Review
of Mortgage Loans.
|
36
|
ARTICLE
IV ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
|
37
|
|
Section
4.01
|
Company
to Act as Servicer.
|
37
|
Section
4.02
|
Liquidation
of Mortgage Loans.
|
39
|
Section
4.03
|
Collection
of Mortgage Loan Payments.
|
40
|
Section
4.04
|
Establishment
of and Deposits to Custodial Account.
|
40
|
Section
4.05
|
Permitted
Withdrawals From Custodial Account.
|
42
|
Section
4.06
|
Establishment
of and Deposits to Escrow Account.
|
43
|
Section
4.07
|
Permitted
Withdrawals From Escrow Account.
|
44
|
Section
4.08
|
Payment
of Taxes, Insurance and Other Charges.
|
44
|
Section
4.09
|
Protection
of Accounts.
|
45
|
Section
4.10
|
Maintenance
of Hazard Insurance.
|
45
|
Section
4.11
|
Maintenance
of Mortgage Impairment Insurance.
|
47
|
Section
4.12
|
Maintenance
of Fidelity Bond and Errors and Omissions Insurance.
|
47
|
Section
4.13
|
Inspections.
|
47
|
Section
4.14
|
Restoration
of Mortgaged Property.
|
48
|
Section
4.15
|
Maintenance
of PMI and LPMI Policy; Claims.
|
48
|
Section
4.16
|
Title,
Management and Disposition of REO Property.
|
50
|
Section
4.17
|
Real
Estate Owned Reports.
|
52
|
Section
4.18
|
Liquidation
Reports.
|
52
|
Section
4.19
|
Reports
of Foreclosures and Abandonments of Mortgaged Property.
|
52
|
Section
4.20
|
Notification
of Adjustments
|
52
|
ARTICLE
V PAYMENTS TO PURCHASER
|
52
|
|
Section
5.01
|
Remittances.
|
52
|
Section
5.02
|
Statements
to Purchaser.
|
53
|
Section
5.03
|
Monthly
Advances by Company.
|
53
|
i
ARTICLE
VI GENERAL SERVICING PROCEDURES
|
54
|
|
Section
6.01
|
Transfers
of Mortgaged Property.
|
54
|
Section
6.02
|
Satisfaction
of Mortgages and Release of Mortgage Files.
|
55
|
Section
6.03
|
Servicing
Compensation.
|
55
|
Section
6.04
|
Annual
Statement as to Compliance.
|
56
|
Section
6.05
|
Annual
Independent Public Accountants’ Servicing Report.
|
56
|
Section
6.06
|
Access
to Certain Documentation.
|
57
|
Section
6.07
|
Reports
and Returns to be Filed by the Company.
|
57
|
Section
6.08
|
Compliance
with REMIC Provisions.
|
57
|
Section
6.09
|
Right
to Examine Company Records.
|
58
|
ARTICLE
VII AGENCY TRANSFER; PASS-THROUGH TRANSFER
|
58
|
|
Section
7.01
|
Removal
of Mortgage Loans from Inclusion Under this Agreement Upon an
Agency
Transfer, Whole-Loan Transfer or a Pass-Through Transfer on One
or More
Reconstitution Dates.
|
58
|
ARTICLE
VIII COMPANY TO COOPERATE
|
61
|
|
Section
8.01
|
Provision
of Information.
|
61
|
Section
8.02
|
Financial
Statements; Servicing Facility.
|
61
|
ARTICLE
IX THE COMPANY
|
62
|
|
Section
9.01
|
Indemnification;
Third Party Claims.
|
62
|
Section
9.02
|
Merger
or Consolidation of the Company.
|
63
|
Section
9.03
|
Limitation
on Liability of Company and Others.
|
63
|
Section
9.04
|
Limitation
on Resignation and Assignment by Company.
|
64
|
ARTICLE
X DEFAULT
|
64
|
|
Section
10.01
|
Events
of Default.
|
64
|
Section
10.02
|
Waiver
of Defaults.
|
66
|
ARTICLE
XX XXXXXXXXXXX
|
00
|
|
Section
11.01
|
Termination.
|
67
|
Section
11.02
|
Termination
Without Cause.
|
67
|
ARTICLE
XII MISCELLANEOUS PROVISIONS
|
67
|
|
Section
12.01
|
Successor
to Company.
|
67
|
Section
12.02
|
[RESERVED]
|
68
|
Section
12.03
|
Mandatory
Delivery: Grant of Security Interest.
|
68
|
Section
12.04
|
Amendment.
|
69
|
Section
12.05
|
Governing
Law.
|
69
|
Section
12.06
|
Duration
of Agreement.
|
69
|
Section
12.07
|
Notices.
|
69
|
Section
12.08
|
Severability
of Provisions.
|
70
|
Section
12.09
|
Relationship
of Parties.
|
70
|
Section
12.10
|
Execution;
Successors and Assigns.
|
70
|
Section
12.11
|
Recordation
of Assignments of Mortgage.
|
70
|
Section
12.12
|
Assignment
by Purchaser.
|
71
|
Section
12.13
|
No
Personal Solicitation.
|
71
|
Section
12.14
|
Intention
of the Parties.
|
71
|
Section
12.15
|
Third
Party Beneficiary.
|
72
|
Section
12.16
|
Waivers.
|
72
|
ii
Section
12.17
|
Exhibits.
|
72
|
Section
12.18
|
General
Interpretive Principles.
|
72
|
Section
12.19
|
Reproduction
of Documents.
|
73
|
Section
12.20
|
Further
Agreements.
|
73
|
iii
EXHIBITS
EXHIBIT
A
|
MORTGAGE
LOAN SCHEDULE
|
EXHIBIT
B
|
CONTENTS
OF EACH MORTGAGE FILE
|
EXHIBIT
C
|
MORTGAGE
LOAN DOCUMENTS
|
EXHIBIT
D-1
|
FORM
OF CUSTODIAL ACCOUNT
|
CERTIFICATION
|
|
EXHIBIT
D-2
|
FORM
OF CUSTODIAL ACCOUNT
|
LETTER
AGREEMENT
|
|
EXHIBIT
E-1
|
FORM
OF ESCROW ACCOUNT CERTIFICATION
|
EXHIBIT
E-2
|
FORM
OF ESCROW ACCOUNT
|
LETTER
AGREEMENT
|
|
EXHIBIT
F
|
FORM
OF MONTHLY REMITTANCE ADVICE
|
EXHIBIT
G
|
FORM
OF COMPANY CERTIFICATION PURSUANT TO SECTION 6.04
|
EXHIBIT
H
|
UNDERWRITING
GUIDELINES
|
EXHIBIT
I
|
COMPANY’S
OFFICER’S CERTIFICATE
|
EXHIBIT
J
|
FORM
OF OPINION OF COUNSEL TO THE COMPANY
|
EXHIBIT
K
|
SECURITY
RELEASE CERTIFICATION
|
EXHIBIT
L
|
ASSIGNMENT
AND CONVEYANCE
|
iv
This
is
an Master Seller’s Warranties and Servicing Agreement for conventional fixed
rate and adjustable rate residential first lien mortgage loans, dated and
effective as of January 1, 2005 and is executed between DB Structured Products,
Inc. as purchaser (the “Purchaser”),
and
National City Mortgage Co., as seller and servicer (the “Company”).
WITNESSETH:
WHEREAS,
the Purchaser may agree to purchase from the Company from time to time
and the
Company desires to sell to the Purchaser from time to time certain Mortgage
Loans;
WHEREAS,
each of the Mortgage Loans is secured by a mortgage, deed of trust or other
security instrument creating a first lien on a residential dwelling located
in
the jurisdiction indicated on the Mortgage Loan Schedule, which is annexed
hereto as Exhibit
A;
and
WHEREAS,
the Purchaser and the Company wish to prescribe the manner of purchase
of the
Mortgage Loans and the management, servicing and control of the Mortgage
Loans.
NOW,
THEREFORE, in consideration of the mutual agreements hereinafter set forth,
and
for other good and valuable consideration, the receipt and adequacy of
which is
hereby acknowledged, the Purchaser and the Company agree as
follows:
ARTICLE
I
DEFINITIONS
Whenever
used herein, the following words and phrases, unless the context otherwise
requires, shall have the following meanings:
Accepted
Servicing Practices:
With
respect to any Mortgage Loan, those mortgage servicing practices of prudent
mortgage lending institutions which service mortgage loans of the same
type as
such Mortgage Loan in the jurisdiction where the related Mortgaged Property
is
located and in accordance with applicable law and the terms of the related
Mortgage and Mortgage Note.
Adjustment
Date:
With
respect to any Adjustable Rate Mortgage Loan, the date set forth in the
related
Mortgage Note on which the Mortgage Interest Rate on such Adjustable Rate
Mortgage Loan is adjusted in accordance with the terms of the Mortgagee
Note.
Adjustable
Rate Mortgage Loan:
A
Mortgage Loan which provides for the adjustment of the Mortgage Interest
Rate
payable in respect thereto.
Agency
Transfer:
The
sale or transfer by Purchaser of some or all of the Mortgage Loans to Xxxxxx
Xxx
under its Cash Purchase Program or its MBS Swap Program (Special Servicing
Option) or to Xxxxxxx Mac under its Xxxxxxx Xxx Xxxx Program or Gold PC
Program,
retaining the Company as “servicer thereunder”.
1
Agreement:
This
Master Seller’s Warranties and Servicing Agreement and all amendments hereof and
supplements hereto.
ALTA:
The
American Land Title Association or any successor thereto.
Ancillary
Income:
All
fees derived from the Mortgage Loans, other than Servicing Fees and prepayment
fees, including but not limited to, late charges, fees received with
respect to
checks or bank drafts returned by the related bank for non-sufficient
funds,
assumption fees, optional insurance administrative fees and all other
incidental
fees and charges.
Appraised
Value:
With
respect to any Mortgaged Property, the lesser of (i) the value thereof
as
determined by an appraisal made for the originator of the Mortgage Loan
at the
time of origination of the Mortgage Loan by an appraiser who met the
minimum
requirements of Xxxxxx Xxx and Xxxxxxx Mac, and (ii) the purchase price
paid for
the related Mortgaged Property by the Mortgagor with the proceeds of
the
Mortgage Loan, provided,
however,
in the
case of a Refinanced Mortgage Loan, such value of the Mortgaged Property
is
based solely upon the value determined by an appraisal made for the originator
of such Refinanced Mortgage Loan at the time of origination of such Refinanced
Mortgage Loan by an appraiser who met the minimum requirements of Xxxxxx
Mae and
Xxxxxxx Mac.
Appropriate
Federal Banking Agency:
Appropriate Federal Banking Agency shall have the meaning ascribed to
it by
Section 1813(q) of Title 12 of the United States Code, as amended from
time to
time.
Approved
Flood Policy Insurer:
An
insurer that meets the guidelines of the Federal Insurance
Administration.
Approved
Tax Service Contract Provider:
Any of
the following providers: First American, TransAmerica, Lereta or
Fidelity
Assignment
of Mortgage:
An
individual assignment of the Mortgage, notice of transfer or equivalent
instrument in recordable form, sufficient under the laws of the jurisdiction
wherein the related Mortgaged Property is located to give record notice
of the
sale of the Mortgage to the Purchaser.
Balloon
Loan: A
Mortgage Loan identified on the Mortgage Loan Schedule as a balloon mortgage
loan.
BIF:
The
Bank Insurance Fund, or any successor thereto.
BPO:
A
broker’s price opinion with respect to a Mortgaged Property.
Business
Day:
Any day
other than (i) a Saturday or Sunday, or (ii) a day on which banking and
savings
and loan institutions in the State of Ohio are authorized or obligated
by law or
executive order to be closed.
Cash-Out
Refinancing:
A
Refinanced Mortgage Loan the proceeds of which were in excess of the
principal
balance of any existing first mortgage on the related Mortgaged Property
and
related closing costs, and were used to pay any such existing first mortgage,
related closing costs and subordinate mortgages on the related Mortgaged
Property.
Closing
Date:
The
date or dates set forth on the related Trade Confirmation on which the
Purchaser
from time to time shall purchase and the Company from time to time shall
sell,
the Mortgage Loans listed on the related Mortgage Loan Schedule.
2
Code:
The
Internal Revenue Code of 1986, as it may be amended from time to time
or any
successor statute thereto, and applicable U.S. Department of the Treasury
regulations issued pursuant thereto.
Combined
LTV or CLTV:
With
respect to any Mortgage Loan, the ratio of the Stated Principal Balance
of the
Mortgage Loan and any other mortgage loan which is secured by a lien
on the
related Mortgage Property as of the related Cut-off Date (unless otherwise
indicated) to the lesser of (a) the Appraised Value of the Mortgaged
Property
and (b) if the Mortgage Loan was made to finance the acquisition of the
related
Mortgaged Property, the purchase price of the Mortgaged Property, expressed
as a
percentage.
Company:
National City Mortgage Co., or its successor in interest or assigns,
or any
successor to the Company under this Agreement appointed as herein
provided.
Condemnation
Proceeds:
All
awards or settlements in respect of a Mortgaged Property, whether permanent
or
temporary, partial or entire, by exercise of the power of eminent domain
or
condemnation, to the extent not required to be released to a Mortgagor
in
accordance with the terms of the related Mortgage Loan Documents.
Convertible
Mortgage Loan: Any
Mortgage Loan purchased pursuant to this Agreement as to which the related
Mortgage Note permits the Mortgagor to convert the Mortgage Interest
Rate on
such Mortgage Loan to a fixed Mortgage Interest Rate.
Custodial
Account:
The
separate account or accounts created and maintained pursuant to Section
4.04.
Custodial
Agreement:
That
certain Custodial Agreement, dated as of January 1, 2002, by and between
the
Purchaser and Xxxxx Fargo Bank Minnesota, National Association.
Custodian:
The
Custodian under the Custodial Agreement, or its successor in interest
or assigns
or any successor to the Custodian under the Custodial Agreement as provided
therein.
Cut-off
Date:
The
date set forth on the related Trade Confirmation.
Deleted
Mortgage Loan:
A
Mortgage Loan which is repurchased by the Company in accordance with
the terms
of this Agreement and which is, in the case of a substitution pursuant
to
Section 3.03, replaced or to be replaced with a Qualified Substitute
Mortgage
Loan.
Determination
Date:
The
15th
day (or
if such 15th
day is
not a Business Day, the Business Day immediately preceding such 15th
day) of
the month of the related Remittance Date.
Due
Date:
The day
of the month on which the Monthly Payment is due on a Mortgage Loan,
exclusive
of any days of grace. With respect to the Mortgage Loans for which payment
from
the Mortgagor is due on a day other than the first day of the month,
such
Mortgage Loans will be treated as if the Monthly Payment is due on the
first day
of the month of such Due Date.
Due
Period:
With
respect to each Remittance Date, the period commencing on the second
day of the
month preceding the month of the Remittance Date and ending in the first
day of
the month of the Remittance Date.
3
Eligible
Investments:
Any one
or more of the obligations and securities listed below which investment
provides
for a date of maturity not later than the Determination Date in each
month:
(i) direct
obligations of, and obligations fully guaranteed by, the United States
of
America, or any agency or instrumentality of the United States of America
the
obligations of which are backed by the full faith and credit of the United
States of America; and
(ii) federal
funds, demand and time deposits in, certificates of deposits of, or bankers’
acceptances issued by, any depository institution or trust company incorporated
or organized under the laws of the United States of America or any state
thereof
and subject to supervision and examination by federal and/or state banking
authorities, so long as at the time of such investment or contractual
commitment
providing for such investment the commercial paper or other short-term
debt
obligations of such depository institution or trust company (or, in the
case of
a depository institution or trust company which is the principal subsidiary
of a
holding company, the commercial paper or other short-term debt obligations
of
such holding company) are rated “P-1” by Xxxxx’x Investors Service, Inc. and the
long-term debt obligations of such depository institution or trust company
(or,
in the case of a depository institution or trust company which is the
principal
subsidiary of a holding company, the long-term debt obligations of such
holding
company) are rated at least “Aa” by Xxxxx’x Investors Service,
Inc.;
provided,
however,
that
no such
instrument shall be an Eligible Investment if such instrument evidences
either
(i) a right to receive only interest payments with respect to the
obligations underlying such instrument, or (ii) both principal and interest
payments derived from obligations underlying such instrument and the
principal
and interest payments with respect to such instrument provide a yield
to
maturity of greater than 120% of the yield to maturity at par of such
underlying
obligations.
Errors
and Omissions Insurance Policy:
An
errors and omissions insurance policy to be maintained by the Company
pursuant
to Section 4.12.
Escrow
Account:
The
separate account or accounts created and maintained pursuant to Section
4.06.
Escrow
Payments:
With
respect to any Mortgage Loan, the amounts constituting ground rents,
taxes,
assessments, water rates, sewer rents, municipal charges, mortgage insurance
premiums, fire and hazard insurance premiums, condominium charges, and
any other
payments required to be escrowed by the Mortgagor with the mortgagee
pursuant to
the Mortgage or any other related document.
Event
of Default:
Any one
of the conditions or circumstances enumerated in Section 10.01.
Xxxxxx
Xxx:
Xxxxxx
Xxx (formerly known as the Federal National Mortgage Association), or
any
successor thereto.
4
Xxxxxx
Mae Guides:
The
Xxxxxx Xxx Xxxxxxx’ Guide and the Xxxxxx Mae Servicers’ Guide and all amendments
or additions thereto.
FDIC:
The
Federal Deposit Insurance Corporation, or any successor thereto.
Fidelity
Bond:
A
fidelity bond to be maintained by the Company pursuant to Section
4.12.
First
Remittance Date:
February 18, 2005.
Fixed
Rate Mortgage Loan:
A
Mortgage Loan with respect to which the Mortgage Interest Rate set forth
in the
Mortgage Note is fixed for the term of such Mortgage Loan.
Xxxxxxx
Mac:
Xxxxxxx
Mac (formerly known as The Federal Home Loan Mortgage Corporation), or
any
successor thereto.
Gross
Margin:
With
respect to any Adjustable Rate Mortgage Loan, the fixed percentage amount
set
forth in the related Mortgage Note and the related Mortgage Loan Schedule
that
is added to the Index on each Adjustment Date in accordance with the
terms of
the related Mortgage Note to determine the new Mortgage Interest Rate
for such
Mortgage Loan.
HUD:
The
United States Department of Housing and Urban Development or any successor
thereto.
Index:
With
respect to any Adjustable Rate Mortgage Loan, the index identified on
the
Mortgage Loan Schedule and set forth in the related Mortgage Note for
the
purpose of calculating the Mortgage Interest Rate thereon.
Initial
Rate Cap:
With
respect to each Adjustable Rate Mortgage Loan and the initial Adjustment
Date
therefor, a number of percentage points per annum that is set forth in
the
related Mortgage Loan Schedule and in the related Mortgage Note, which
is the
maximum amount by which the Mortgage Interest Rate for such Mortgage
Loan may
increase or decrease from the Mortgage Interest Rate in effect immediately
prior
to such Adjustment Date.
Insurance
Proceeds:
With
respect to each Mortgage Loan, proceeds of insurance policies insuring
the
Mortgage Loan or the related Mortgaged Property.
Liquidation
Proceeds:
Cash
received in connection with the liquidation of a defaulted Mortgage Loan,
whether through the sale or assignment of such Mortgage Loan, trustee’s sale,
foreclosure sale or otherwise, or the sale of the related Mortgaged Property
if
the Mortgaged Property is acquired in satisfaction of the Mortgage
Loan.
Lifetime
Rate Cap:
With
respect to each Adjustable Rate Mortgage Loan during the term thereof,
a number
of percentage points per annum that is set forth in the related Mortgage
Loan
Schedule and in the related Mortgage Note, which is the maximum amount
by which
the Mortgage Interest Rate for such Adjustable Rate Mortgage Loan may
increase
or decrease during the term thereof from the Mortgage Interest Rate in
effect on
the date of origination of such Adjustable Rate Mortgage Loan.
Loan-to-Value
Ratio or LTV:
With
respect to any Mortgage Loan, the ratio of the Stated Principal Balance
of the
Mortgage Loan as of the related Cut-off Date (unless otherwise indicated)
to the
lesser of (a) the Appraised Value of the Mortgaged Property and (b) if
the
Mortgage Loan was made to finance the acquisition of the related Mortgaged
Property, the purchase price of the Mortgaged Property, expressed as
a
percentage.
5
LPMI
Fee:
With
respect to each LPMI Loan, the portion of the Mortgage Interest Rate
as set
forth on the related Mortgage Loan Schedule (which shall be payable solely
from
the interest portion of Monthly Payments, Insurance Proceeds, Condemnation
Proceeds or Liquidation Proceeds or by the Purchaser), which, during
such period
prior to the required cancellation of the LPMI Policy, shall be used
to pay the
premium due on the related LPMI Policy.
LPMI
Loan: A
Mortgage Loan with a LPMI Policy.
LPMI
Policy: A
policy
of primary mortgage guaranty insurance issued by a Qualified Insurer
pursuant to
which the related premium is to be paid by the Servicer of the related
Mortgage
Loan from payments of interest made by the Mortgagor (or by the Purchaser)
in an
amount as is set forth in the related Trade Confirmation and the related
Mortgage Loan Schedule.
Maximum
Mortgage Interest Rate:
With
respect to each Adjustable Rate Mortgage Loan, a rate that is set forth
on the
related Mortgage Loan Schedule and in the related Mortgage Note and is
the
maximum interest rate to which the Mortgage Interest Rate on such Adjustable
Rate Mortgage Loan may be increased on any Adjustment Date.
MERS:
Mortgage Electronic Registration Systems, Inc., a corporation organized
and
existing under the laws of the State of Delaware, or any successor
thereto.
MERS
Mortgage Loan:
Any
Mortgage Loan registered with MERS on the MERS System.
MERS
System:
The
system of recording transfers of mortgages electronically maintained
by
MERS.
MIN:
The
Mortgage Identification Number for any MERS Mortgage Loan.
Minimum
Mortgage Interest Rate:
With
respect to each Adjustable Rate Mortgage Loan, a rate that is set forth
on the
related Mortgage Loan Schedule and in the related Mortgage Note and is
the
minimum interest rate to which the Mortgage Interest Rate on such Adjustable
Rate Mortgage Loan may be decreased on any Adjustment Date.
MOM
Loan:
Any
Mortgage Loan as to which MERS is acting as mortgagee, solely as nominee
for the
originator of such Mortgage Loan and its successors and assigns.
Monthly
Advance:
The
portion of Monthly Payment delinquent with respect to each Mortgage Loan
at the
close of business on the Determination Date required to be advanced by
the
Company pursuant to Section 5.03 on the Business Day immediately preceding
the
Remittance Date of the related month.
Monthly
Payment:
The
scheduled monthly payment of principal and interest on a Mortgage
Loan.
Moody’s:
Xxxxx’x
Investors Service, Inc. or its successor in interest.
Mortgage:
The
mortgage, deed of trust or other instrument securing a Mortgage Note,
which
creates a first lien on an unsubordinated estate in fee simple in real
property
securing the Mortgage Note.
6
Mortgage
File:
The
items pertaining to a particular Mortgage Loan referred to in Exhibit
B
annexed
hereto, and any additional documents required to be added to the Mortgage
File
pursuant to this Agreement.
Mortgage
Impairment Insurance Policy:
A
mortgage impairment or blanket hazard insurance policy as described in
Section
4.11.
Mortgage
Interest Rate:
The
annual rate of interest borne on a Mortgage Note.
Mortgage
Loan:
Each
first lien, residential loan, which is the subject of this Agreement,
originally
sold and subject to this Agreement being identified on the related Mortgage
Loan
Schedule, which Mortgage Loan includes without limitation the Mortgage
File, the
Monthly Payments, Principal Prepayments, Liquidation Proceeds, Condemnation
Proceeds, Insurance Proceeds, REO Disposition Proceeds and all other
rights,
benefits, proceeds and obligations arising from or in connection with
such
Mortgage Loan.
Mortgage
Loan Documents:
The
documents listed in Exhibit
C
hereto.
Mortgage
Loan Package:
A pool
of Mortgage Loans sold to the Purchaser by the Company on a Closing
Date.
Mortgage
Loan Remittance Rate:
With
respect to each Mortgage Loan, the annual rate of interest remitted to
the
Purchaser, which shall be equal to the Mortgage Interest Rate minus (i)
the
Servicing Fee Rate and (ii) with respect to LPMI Loans, the LPMI
Fee.
7
Mortgage
Loan Schedule:
With
respect to each Mortgage Loan Package, a schedule of Mortgage Loans annexed
to
the related Assignment and Conveyance and annexed hereto as Exhibit
A,
such
schedule setting forth the following information with respect to each
Mortgage
Loan: (1) the Company's Mortgage Loan identifying number; (2) the Mortgagor's
and Co-Mortgagor’s name; (3) the street address of the Mortgaged Property
including the city, state, county, and the zip code; (4) the lot, block,
and
section numbers of the Mortgaged Property; (5) a code indicating whether
the
loan was originated through a correspondent, retail, or wholesale channel;
(6)
the broker identification number; (7) a code indicating whether the Mortgaged
Property is a single family residence, a 2-4 family dwelling, a PUD,
a townhouse
or a unit in a high-rise or low-rise condominium project; (8) the year
in which
the Mortgaged Property was built; (9) the number of units for all Mortgaged
Properties; (10) the number of bedrooms and rents by unit; (11) the original
months to maturity or the remaining months to maturity from the related
Cut-off
Date, in any case based on the original amortization schedule, and if
different,
the maturity expressed in the same manner but based on the actual amortization
schedule; (12) a code indicating the lien status of the Mortgage Loan;
(13) the
Loan-to-Value Ratio at origination; (14) the Combined LTV at origination,
if
applicable; (15) the Appraised Value and purchase price, if applicable,
of the
Mortgaged Property; (16) the Mortgage Interest Rate at the time of origination;
(17) the Mortgage Interest Rate as of the related Cut-off Date; (18)
the
application date of the Mortgage Loan; (19) the Mortgage Loan
approval/commitment date; (20) the origination date of the Mortgage Loan;
(21)
the first payment date of the Mortgage Loan; (22) the stated maturity
date of
the Mortgage Loan; (23) the amount of the Monthly Payment as of the related
Cut-off Date; (24) the amount of the Monthly Payment at the time of origination;
(25) the date on which the first Monthly Payment was due on the Mortgage
Loan
and, if such date is not consistent with the Due Date, such Due Date;
(26) the
next actual Due Date of the Mortgage Loan; (27) a twelve month history
for the
Mortgage Loan and the number of times thirty, sixty, and ninety days
delinquent
in the past twelve months; (28) a code indicating the payment status
of the
Mortgage Loan (i.e. bankruptcy, foreclosure, REO); (29) a twelve month
history
for the prior Mortgage Loan and the number of times thirty, sixty, and
ninety
days delinquent in the past twelve months; (30) the original principal
amount of
the Mortgage Loan; (31) the original principal amount of any senior Mortgage
Loans; (32) the actual principal balance of the Mortgage Loan as of the
close of
business on the related Cut-off Date, after deduction of payments of
principal
actually collected on or before the related Cut-off Date; (33) the scheduled
principal balance of the Mortgage Loan as of the close of business on
the
related Cut-off Date; after deduction of payments of principal due on
or before
the related Cut-off Date, whether or not collected, if applicable; (34)
the
Mortgage Loan purpose type (i.e., purchase financing, Rate/Term Refinancing,
Cash-Out Refinancing); (35) the product type (i.e., 2/28, 15 years, 30
year
fixed, 15/30 balloon); (36) the occupancy status of the Mortgaged Property
at
the time of origination; (37) the Mortgagor’s and Co-Mortgagor’s FICO score;
(38) a code indicating the mortgage insurance provider (PMI or LPMI)
and percent
of coverage, if applicable; (39) the mortgage insurance certificate number;
a
code indicating the method of payment for mortgage insurance premiums
and cost
(LPMI), if applicable; (40) the loan documentation type (i.e., full,
alternative, reduced); (41) the back-end debt to income ratio; (42) number
of
Mortgagors; (43) Mortgagor Social Security Number; (44) co-Mortgagor
Social
Security Number; (45) Mortgagor date of birth; (46) co-Mortgagor date
of birth;
(47) Mortgagor gender; (48) co-Mortgagor gender; (49) Mortgagor race;
(50)
co-Mortgagor race; (51) combined annual income; (52) a code indicating
first
time buyer; (53) the monthly Servicing Fee, if provided; (54) the tax
service
contract provider; (55) the flood insurance certification contract provider;
(56) the monthly tax and insurance payment; (57) the escrow balance as
of the
Cut-Off Date; (58) a code indicating whether the Mortgage Loan is subject
to a
Prepayment Charge, the term of such Prepayment Charge and the amount
of such
Prepayment Charge; (59) a code indicating whether the Mortgage Loan is
an
Adjustable Rate Mortgage Loan or a Fixed Rate Mortgage Loan; (60) the
first
Adjustment Date and the Adjustment Date frequency; (61) the Gross Margin;
(62)
the Maximum Mortgage Interest Rate under the terms of the Mortgage Note;
(63)
the Minimum Mortgage Interest Rate under the terms of the Mortgage Note;
(64)
the Initial Rate Cap and Periodic Rate Cap; (65) the first Adjustment
Date
immediately following origination and the related Cut-off Date; (66)
the Index;
(67) a code indicating the type of Adjustable Rate Mortgage Loan (i.e.
3/1,
5/1/7/1, etc); (68) a code indicating whether the Mortgage Loan is a
MERS
Mortgage Loan and, if so, the corresponding MIN; (69) the Lifetime Rate
Cap;
(70) the
Mortgagor’s income at origination; (71) a code indicating whether the related
Mortgagor is self-employed; and (73)
a
code indicating the form of appraisal (i.e. form 1004, 2055, etc.).
With
respect to the Mortgage Loans in each Mortgage Loan Package in the aggregate,
the related Mortgage Loan Schedule shall set forth the following information,
as
of the related Cut-off Date: (1) the number of Mortgage Loans; (2) the
current aggregate outstanding principal balance of the Mortgage Loans;
(3) the weighted average Mortgage Interest Rate of the Mortgage Loans; and
(4) the weighted average maturity of the Mortgage Loans.
Mortgage
Note:
The
note or other evidence of the indebtedness of a Mortgagor secured by
a
Mortgage.
Mortgaged
Property:
The
real property, improved by a residential dwelling, securing repayment
of the
debt evidenced by a Mortgage Note.
8
Mortgagor:
The
obligor on a Mortgage Note.
Net
Mortgage Interest Rate:
With
respect to any Mortgage Loan (or the related REO Property), as of any
date of
determination, a per annum rate of interest equal to the then applicable
Mortgage Interest Rate for such Mortgage Loan minus the Servicing Fee
Rate.
Officer’s
Certificate:
A
certificate signed by the Chairman of the Board or the Vice Chairman
of the
Board or the President or a Vice President or an assistant Vice President
and by
the Treasurer or the Secretary or one of the Assistant Treasurers or
Assistant
Secretaries of the Company, and delivered to the Purchaser as required
by this
Agreement.
Opinion
of Counsel:
A
written opinion of counsel, who may be an employee of the Company, reasonably
acceptable to the Purchaser.
Pass-Through
Transfer:
The
sale or transfer of some or all of the Mortgage Loans to a trust to be
formed as
part of a publicly-issued and/or privately placed, rated or unrated,
mortgage
pass-through transaction.
Periodic
Rate Cap:
With
respect to each Adjustable Rate Mortgage Loan and any Adjustment Date
therefor,
a number of percentage points that is set forth in the related Mortgage
Loan
Schedule and in the related Mortgage Note, which is the maximum amount
by which
the Mortgage Interest Rate for such Adjustable Rate Mortgage Loan may
increase
(without regard to the Maximum Mortgage Interest Rate) or decrease (without
regard to the Minimum Mortgage Interest Rate) on such Adjustment Date
from the
Mortgage Interest Rate in effect immediately prior to such Adjustment
Date,
which may be a different amount with respect to the first Adjustment
Date.
Person:
Any
individual, corporation, partnership, limited liability company, joint
venture,
association, joint-stock company, trust, unincorporated organization,
government
or any agency or political subdivision thereof.
PMI:
PMI
Mortgage Insurance Co., or any successor thereto.
PMI
Policy:
A
policy of primary mortgage guaranty insurance issued by a Qualified Insurer,
as
required by this Agreement with respect to certain Mortgage Loans.
Premium: The
premium payable by the Company to the Purchaser with respect to any Mortgage
Loans that prepay-in-full as stated in the related Trade Confirmation.
Prepayment
Charge: With
respect to any Mortgage Loan, any prepayment penalty or premium thereon
payable
in connection with a principal prepayment on such Mortgage Loan pursuant
to the
terms of the related Mortgage Note.
Prepayment
Interest Shortfall Amount:
With
respect to any Mortgage Loan that was subject to a Principal Prepayment
in full
or in part during any Due Period, which Principal Prepayment was applied
to such
Mortgage Loan prior to such Mortgage Loan’s Due Date in such Due Period, the
amount of interest (net the related Servicing Fee) that would have accrued
on
the amount of such Principal Prepayment during the period commencing
on the date
as of which such Principal Prepayment was applied to such Mortgage Loan
and
ending on the day immediately preceding such Due Date, inclusive.
Prime
Rate:
The
prime rate announced to be in effect from time to time, as published
as the
average rate in the “Money Rates” section of The Wall Street Journal.
Principal
Prepayment:
Any
payment or other recovery of principal on a Mortgage Loan which is received
in
advance of its scheduled Due Date, including any Prepayment Charge, which
is not
accompanied by an amount of interest representing scheduled interest
due on any
date or dates in any month or months subsequent to the month of
prepayment.
9
Principal
Prepayment Period:
The
month preceding the month in which the related Remittance Date
occurs.
Purchase
Price:
The
price paid on the related Closing Date, by the Purchaser to the Company
pursuant
to the related Trade Confirmation in exchange for the Mortgage Loans
purchased
on such Closing Date as provided in Section 2.01 and 2.02.
Purchase
Price Percentage:
The
percentage of par used to calculate the purchase price for the Mortgage
Loans as
set forth in the related Trade Confirmation.
Purchaser:
DB
Structured Products, Inc. or its successor in interest or any successor
to the
Purchaser under this Agreement as herein provided.
Qualified
Depository:
A
depository the accounts of which are insured by the FDIC through the
BIF or the
SAIF and the debt obligations of which are rated AA or better by Standard
&
Poor’s Ratings Group.
Qualified
Insurer:
A
mortgage guaranty insurance company duly authorized and licensed where
required
by law to transact mortgage guaranty insurance business and approved
as an
insurer by Xxxxxx Xxx and Xxxxxxx Mac.
Qualified
Substitute Mortgage Loan:
A
mortgage loan eligible to be substituted by the Company for a Deleted
Mortgage
Loan which must, on the date of such substitution, (i) have an outstanding
principal balance, after deduction of all scheduled payments due in the
month of
substitution (or in the case of a substitution of more than one mortgage
loan
for a Deleted Mortgage Loan, an aggregate principal balance), not in
excess of
the Stated Principal Balance of the Deleted Mortgage Loan as of the Due
Date in
the calendar month during which the substitution occurs; (ii) have a
Mortgage
Loan Remittance Rate not less than and not more than 1% greater than
the
Mortgage Loan Remittance Rate of the Deleted Mortgage Loan; (iii) have
a Net
Mortgage Interest Rate not less than and not more than 1% greater than
the Net
Mortgage Interest Rate of the Deleted Mortgage Loan; (iv) have a remaining
term
to maturity not greater than and not more than one year less than that
of the
Deleted Mortgage Loan; (v) comply with each representation and warranty
set
forth in Sections 3.01 and 3.02; (vi) have the same Due Date as the Due
Date on
the Deleted Mortgage Loan; (vii) have a Loan-to-Value Ratio as of the
date of
substitution equal to or lower than the Loan-to-Value Ratio of the Deleted
Mortgage Loan as of such date; (viii) be covered under a PMI Policy if
such
Qualified Substitute Mortgage Loan has a Loan-to-Value Ratio in excess
of 80%
and the Deleted Mortgage Loan was covered under a PMI Policy; and (ix)
be the
same type of mortgage loan (i.e. fixed or adjustable rate with the same
Gross
Margin and Index as the Deleted Mortgage Loan). In the event that one
or more
mortgage loans are substituted for one or more Deleted Mortgage Loans,
the
amounts described in clause (i) hereof shall be determined on the basis
of
aggregate principal balances, the Mortgage Interest Rates described in
clause
(ii) hereof shall be determined on the basis of weighted average Mortgage
Interest Rates and shall be satisfied as to each such mortgage loan,
the terms
described in clause (iv) shall be determined on the basis of weighted
average
remaining terms to maturity, the Loan-to-Value Ratios described in clause
(vii)
hereof shall be satisfied as to each such mortgage loan and, except to
the
extent otherwise provided in this sentence, the representations and warranties
described in clause (v) hereof must be satisfied as to each Qualified
Substitute
Mortgage Loan or in the aggregate, as the case may be. In addition, the
substitution of more than one Mortgage Loan pursuant to the previous
sentence
shall be subject to the Purchaser’s approval in its sole
discretion.
10
Rate/Term
Refinancing:
A
Refinanced Mortgage Loan, the proceeds of which are not in excess of
the
existing first mortgage loan on the related Mortgaged Property and related
closing costs, and were used exclusively to satisfy the then existing
first
mortgage loan of the Mortgagor on the related Mortgaged Property and
to pay
related closing costs.
Rating
Agency:
Any of
Fitch, Xxxxx’x Investors Service, Inc. or Standard & Poor’s Ratings Group or
their respective successors designated by the Purchaser.
Reconstitution
Agreements:
The
agreement or agreements entered into by the Purchaser, the Company, Xxxxxx
Mae
or Xxxxxxx Mac or certain third parties on the Reconstitution Date(s)
with
respect to any or all of the Mortgage Loans, in connection with a Pass-Through
Transfer, Whole-Loan Transfer or an Agency Transfer as set forth in Section
7.01, including, but not limited to, (i) a Xxxxxx Mae Mortgage Selling
and
Servicing Contract, a Pool Purchase Contract, and any and all servicing
agreements and tri-party agreements reasonably required by Xxxxxx Xxx
with
respect to a Xxxxxx Mae Transfer, (ii) a Purchase Contract and all purchase
documents associated therewith as set forth in the Xxxxxxx Xxx Xxxxxxx’ &
Servicers’ Guide, and any and all servicing agreements and tri-party agreements
reasonably required by Xxxxxxx Mac with respect to a Xxxxxxx Mac Transfer,
and
(iii) a Pooling and Servicing Agreement and/or a subservicing/master
servicing
agreement and related custodial/trust agreement and related documents
with
respect to a Pass-Through Transfer.
Reconstitution
Date:
The
date or dates on which any or all of the Mortgage Loans serviced under
this
Agreement shall be removed from this Agreement and reconstituted as part
of an
Agency Transfer, Whole Loan Transfer or a Pass-Through Transfer pursuant
to
Section 7.01 hereof. On such date or dates, the Mortgage Loans transferred
shall
cease to be covered by this Agreement and the Company’s servicing
responsibilities shall cease under this Agreement with respect to the
related
transferred Mortgage Loans.
Record
Date:
The
close of business of the last Business Day of the month preceding the
month of
the related Remittance Date.
Refinanced
Mortgage Loan:
A
Mortgage Loan the proceeds of which were not used to purchase the related
Mortgaged Property.
REMIC:
A “real
estate mortgage investment conduit” within the meaning of Section 860D of the
Code.
REMIC
Provisions:
Provisions of the federal income tax law relating to REMICs, which appear
in
Sections 860A through 860G of the Code, and related provisions, and proposed,
temporary and final regulations and published rulings, notices and announcements
promulgated thereunder, as the foregoing may be in effect from time to
time.
Remittance
Date:
The
18th
day (or
if such 18th
day is
not a Business Day, the first Business Day immediately following) of
any month,
beginning with the First Remittance Date.
REO
Account:
The
separate trust account or accounts created and maintained pursuant to
this
Agreement which shall be entitled “[Company], in trust for the Purchaser, as of
[date of acquisition of title], Fixed and Adjustable Rate Mortgage
Loans”.
11
REO
Disposition:
The
final sale by the Company of any REO Property.
REO
Disposition Proceeds:
All
amounts received with respect to an REO Disposition pursuant to Section
4.16.
REO
Property:
A
Mortgaged Property acquired by the Company on behalf of the Purchasers
through
foreclosure or by deed in lieu of foreclosure, as described in Section
4.16.
Repurchase
Price:
With
respect to any Mortgage Loan, (1) a price equal to (A) during the first
twelve
months following the related Closing Date (i) the Purchase Price Percentage
used
to calculate the Purchase Price, as stated in the related Trade Confirmation,
times the Stated Principal Balance of the Mortgage Loan so repurchased
plus (ii)
accrued interest thereon to the last day of the month such repurchase
occurs,
and (B) thereafter (i) the Stated Principal Balance of the Mortgage Loan
so
repurchased plus (ii) accrued interest thereon to the last day of the
month in
which such repurchase occurs, or (2) such other amount set forth in the
related
Trade Confirmation.
S&P:
Standard & Poor’s, a division of the XxXxxx-Xxxx Companies, Inc., or its
successor in interest.
SAIF:
The
Savings Association Insurance Fund, or any successor thereto.
Securities
Act of 1933 or the 1933 Act:
The
Securities Act of 1933, as amended.
Servicing
Advances:
All
customary, reasonable and necessary “out of pocket” costs and expenses other
than Monthly Advances (including reasonable attorneys’ fees and disbursements)
incurred in the performance by the Company of its servicing obligations,
including, but not limited to, the cost of (a) the preservation, restoration
and
protection of the Mortgaged Property, (b) any enforcement or judicial
proceedings, including foreclosures, (c) the management and liquidation
of any
REO Property and (d) compliance with the obligations under Section
4.08.
Servicing
Fee:
With
respect to each Mortgage Loan, the amount of the annual fee the Purchaser
shall
pay to the Company, which shall, for a period of one full month, be equal
to one
twelfth of the product of (a) the Servicing Fee Rate and (b) the outstanding
principal balance of such Mortgage Loan. Such fee shall be payable monthly
in
arrears, and for any partial month, pro rated on a per diem basis, and
shall be
computed on the basis of the same principal amount and period respecting
which
any related interest payment on a Mortgage Loan is computed. The obligation
of
the Purchaser to pay the Servicing Fee is limited to, and the Servicing
Fee is
payable solely from, the interest portion (including recoveries with
respect to
interest from Liquidation Proceeds, to the extent permitted by Section
4.05) of
such Monthly Payment collected by the Company, or as otherwise provided
under
Section 4.05.
Servicing
Fee Rate:
The per
annum rate set forth on the Mortgage Loan Schedule and the related Trade
Confirmation at which the Servicing Fee accrues.
Servicing
File:
With
respect to each Mortgage Loan, the file retained by the Company consisting
of
originals of all documents in the Mortgage File which are not delivered
to the
Custodian and copies of the Mortgage Loan Documents listed in Exhibit
C
the
originals of which are delivered to the Custodian pursuant to Section
2.01.
Servicing
Officer:
Any
officer of the Company 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 Company to the Purchaser upon request, as such
list
may from time to time be amended.
12
Stated
Principal Balance:
As to
each Mortgage Loan, (i) the principal balance of the Mortgage Loan at
the
related Cut-off Date after giving effect to payments of principal due
on or
before such date, whether or not received, minus (ii) all amounts previously
distributed to the Purchaser with respect to the related Mortgage Loan
representing payments or recoveries of principal or advances in lieu
thereof.
Subservicer:
Any
Subservicer which is subservicing the Mortgage Loans pursuant to a Subservicing
Agreement. Any subservicer shall meet the qualifications set forth in
Section
4.01.
Subservicing
Agreement:
An
agreement between the Company and a Subservicer for the servicing of
the
Mortgage Loans.
Termination
Fee:
The
termination fee payable by the Purchaser to the Company as provided in
Section
11.02 hereof.
Trade
Confirmation:
With
respect to any Mortgage Loan Package purchased and sold on any Closing
Date, the
letter agreement between the Purchaser and the Company (including any
exhibits,
schedules and attachments thereto) setting forth the terms and conditions
of
such transaction and describing the Mortgage Loans to be purchased by
the
Purchaser on such Closing Date. A Trade Confirmation may relate to more
than one
Mortgage Loan Package to be purchased on one or more Closing Dates hereunder.
Underwriting
Guidelines:
The
Company’s written underwriting guidelines attached hereto as Exhibit
H
in
effect with respect to the Mortgage Loans purchased by the Purchaser
on the
initial Closing Date, which may be amended, supplemented or modified
from time
to time thereafter.
Whole
Loan Transfer:
The
sale or transfer of some or all of the Mortgage Loans to third parties
pursuant
to a Reconstitution Agreement, other than a Pass-Through Transfer or
an Agency
Transfer.
ARTICLE
II
CONVEYANCE
OF MORTGAGE LOANS; POSSESSION OF MORTGAGE FILES;
BOOKS
AND RECORDS; DELIVERY OF DOCUMENTS
Section
2.01
|
Conveyance
of Mortgage Loans; Possession of Mortgage Files; Maintenance
of Servicing
Files.
|
The
Company, simultaneously with the payment of the Purchase Price shall
execute and
deliver to the Purchaser an Assignment and Conveyance with respect to
the
related Mortgage Loan Package in the form attached hereto as Exhibit
L.
Pursuant to Section 2.04, on or prior to the related Closing Date the
Company
shall have delivered the Mortgage Loan Documents for each Mortgage Loan
in the
Mortgage Loan Package to the Custodian.
13
The
contents of each Mortgage File not delivered to the Custodian are and
shall be
held in trust by the Company for the benefit of the Purchaser as the
owner
thereof. The Company shall maintain a Servicing File consisting of a
copy of the
contents of each Mortgage File and the originals of the documents in
each
Mortgage File not delivered to the Custodian. The possession of each
Servicing
File by the Company is at the will of the Purchaser for the sole purpose
of
servicing the related Mortgage Loan, and such retention and possession
by the
Company is in a custodial capacity only. Upon the sale of the Mortgage
Loans the
ownership of each Mortgage Note, the related Mortgage and the related
Mortgage
File and Servicing File shall vest immediately in the Purchaser, and
the
ownership of all records and documents with respect to the related Mortgage
Loan
prepared by or which come into the possession of the Company shall vest
immediately in the Purchaser and shall be retained and maintained by
the
Company, in trust, at the will of the Purchaser and only in such custodial
capacity. Each Servicing File shall be segregated from the other books
and
records of the Company and shall be marked appropriately to reflect clearly
the
sale of the related Mortgage Loan to the Purchaser. The Company shall
release
its custody of the contents of any Servicing File only in accordance
with
written instructions from the Purchaser, unless such release is required
as
incidental to the Company’s servicing of the Mortgage Loans or is in connection
with a repurchase of any Mortgage Loan pursuant to Section 3.03 or
6.02.
In
addition, in connection with the assignment of any MERS Mortgage Loans,
the
Company agrees that it will cause, at its own expense, the MERS System
to
indicate that such Mortgage Loans have been assigned by the Company to
the
Purchaser in accordance with this Agreement by including (or deleting,
in the
case of Mortgage Loans which are repurchased in accordance with this
Agreement
prior to the related servicing transfer date) in such computer files
the
information required by the MERS System to identify the Purchaser of
such
Mortgage Loans.
Section
2.02
|
Purchase
Price.
|
On
the
Closing Date, the Purchaser shall pay to the Company for the Mortgage
Loans the
sum of (i) the Stated Principal Balance of the Mortgage Loans multiplied
by the
Purchase Price Percentage, plus (ii) an amount equal to accrued and unpaid
interest on the Mortgage Loans at the Net Mortgage Interest Rate, from
and
including the Cut-Off Date through and including the day before the Closing
Date. The payment by Purchaser
shall be
made by wire transfer before 4:00 pm, Eastern Time, in immediately available
funds to an account designated by Company. If so provided in the related
Trade
Confirmation, portions of the Mortgage Loans shall be priced separately.
If
any
miscalculation is reflected in the purchase price for the Mortgage Loans,
the
party benefiting from such error shall pay an amount sufficient to correct
the
error.
The
Purchaser shall own and be entitled to receive with respect to each Mortgage
Loan purchased, (1) all scheduled principal due after the Cut-off Date,
(2) all
other recoveries of principal collected after the Cut-off Date (provided,
however,
that
all
scheduled payments of principal due on or before the Cut-off Date and
collected
by the Company after the Cut-off Date shall belong to the Company), and
(3) all
payments of interest on the Mortgage Loans minus that portion of any
such
interest payment that is allocable to the period prior to the Cut-off
Date. The
unpaid principal balance of each Mortgage Loan as of the Cut-off Date
is
determined after application to the reduction of principal of payments
of
principal due on or before the Cut-off Date whether or not collected.
Therefore,
for the purposes of this Agreement, payments of scheduled principal and
interest
prepaid for a Due Date beyond the Cut-off Date shall not be applied to
the
principal balance as of the Cut-off Date. Such prepaid amounts shall
be the
property of the Purchaser. The Company shall deposit any such prepaid
amounts
into the Custodial Account, which account is established for the benefit
of the
Purchaser, for the remittance by the Company to the Purchaser on the
First
Remittance Date. All payments of principal and interest due on a Due
Date
following the Cut-off Date shall belong to the Purchaser.
14
Section
2.03
|
Books
and Records; Transfers of Mortgage Loans.
|
From
and
after each sale of the Mortgage Loans to the Purchaser all rights arising
out of
the Mortgage Loans in a Mortgage Loan Package including but not limited
to all
funds received on or in connection with the Mortgage Loans, shall be
received
and held by the Company in trust for the benefit of the Purchaser as
owner of
such Mortgage Loans, and the Company shall retain record title to the
related
Mortgages for the sole purpose of facilitating the servicing and the
supervision
of the servicing of the Mortgage Loans.
It
is the
express intention of the parties that the transactions contemplated by
this
Agreement be, and be construed as, a sale of the Mortgage Loans by the
Company
and not a pledge of the Mortgage Loans by the Company to the Purchaser
to secure
a debt or other obligation of the Company. Consequently, the sale of
each
Mortgage Loan in a Mortgage Loan Package shall be reflected on the Company’s
balance sheet and other financial statements as well as its business
records and
tax returns as a sale of assets by the Company. In the event, for any
reason,
any transaction contemplated herein is construed by any court or regulatory
authority as a borrowing rather than as a sale, the Company and the Purchaser
intend that the Purchaser or its assignee, as the case may be, shall
have a
perfected first priority security interest in the Mortgage Loans, the
Custodial
Account and the proceeds of any and all of the foregoing (collectively,
the
“Collateral”), free and clear of adverse claims. In such case, the Company shall
be deemed to have hereby granted to the Purchaser or its assignee, as
the case
may be, a first priority security interest in and lien upon the Collateral,
free
and clear of adverse claims. In such event, the related Trade Confirmation
and
this Agreement shall constitute a security agreement, the Custodian shall
be
deemed to be an independent custodian for purposes of perfection of the
security
interest granted to the Purchaser or its assignee, as the case may be,
and the
Purchaser or its assignee, as the case may be, shall have all of the
rights of a
secured party under applicable law.
The
Company shall be responsible for maintaining, and shall maintain, a complete
set
of books and records for each Mortgage Loan which shall be marked clearly
to
reflect the ownership of each Mortgage Loan by the Purchaser. In particular,
the
Company shall maintain in its possession, available for inspection by
the
Purchaser, or its designee and shall deliver to the Purchaser upon demand,
evidence of compliance with all federal, state and local laws, rules
and
regulations, and requirements of Xxxxxx Xxx or Xxxxxxx Mac, including
but not
limited to documentation as to the method used in determining the applicability
of the provisions of the Flood Disaster Protection Act of 1973, as amended,
to
the Mortgaged Property, documentation evidencing insurance coverage and
eligibility of any condominium project for approval by Xxxxxx Mae and
periodic
inspection reports as required by Section 4.13. To the extent that original
documents are not required for purposes of realization of Liquidation
Proceeds
or Insurance Proceeds, documents maintained by the Company may be in
the form of
microfilm or microfiche or such other reliable means of recreating original
documents, including but not limited to, optical imagery techniques so
long as
the Company complies with the requirements of the Xxxxxx Xxx Selling
and
Servicing Guide, as amended from time to time.
15
The
Company shall maintain with respect to each Mortgage Loan and shall make
available for inspection by any Purchaser or its designee the related
Servicing
File during the time the Purchaser retains ownership of a Mortgage Loan
and
thereafter in accordance with applicable laws and regulations.
The
Company shall keep at its servicing office books and records in which,
subject
to such reasonable regulations as it may prescribe, the Company shall
note
transfers of Mortgage Loans. For the purposes of this Agreement, the
Company
shall be under no obligation to deal with any person with respect to
this
Agreement or the Mortgage Loans unless the books and records show such
person as
the owner of the Mortgage Loan. The Purchaser may sell and transfer one
or more
of the Mortgage Loans, provided,
however,
that
the
transferee will not be deemed to be a Purchaser hereunder binding upon
the
Company unless such transferee shall agree in writing to be bound by
the terms
of this Agreement and an original counterpart of the instrument of transfer
and
an assignment and assumption of this Agreement executed by the transferee
shall
have been delivered to the Company.
Section
2.04
|
Delivery
of Documents
|
On
or
before the date which is five Business Days prior to the related Closing
Date,
the Company shall deliver and release to the Custodian those Mortgage
Loan
Documents as required by this Agreement with respect to each Mortgage
Loan in
the related Mortgage Loan Package a list of which is attached to the
related
Assignment and Conveyance.
On
or
prior to the related Closing Date, the Custodian shall certify its receipt
of
all such Mortgage Loan Documents required to be delivered pursuant to
the
Custodial Agreement, as evidenced by the initial trust receipt of the
Custodian
in the form annexed to the Custodial Agreement (other than those Mortgage
Loan
Documents listed on a document exception report attached thereto). The
Company
and the Purchaser shall pay the fees and expenses of the Custodian as
incurred
by such party. The Company’s expenses shall include, but not be limited to, the
Custodian’s preparation of trust receipts and certifications.
The
Company shall forward to the Custodian original documents evidencing
an
assumption, modification, consolidation or extension of any Mortgage
Loan
entered into in accordance with Section 4.01 or 6.01 within one week
of their
execution, provided,
however,
that
the
Company shall provide the Custodian with a certified true copy of any
such
document submitted for recordation within one week of its execution,
and shall
provide the original of any document submitted for recordation or a copy
of such
document certified by the appropriate public recording office to be a
true and
complete copy of the original within sixty days of its submission for
recordation.
Section
2.05
|
Closing
Documents.
|
16
(a)
On
or
before the initial Closing Date, the Company shall submit to the Purchaser
fully
executed originals of the following documents:
(i) this
Agreement, in four counterparts;
(ii) an
Officer’s Certificate, in the form of Exhibit
I
hereto,
including all
attachments thereto;
(iii) an
Opinion of Counsel to the Company, in the form of Exhibit
Jhereto;
(iv) a
Custodial Account Letter Agreement in the form of Exhibit
D-2hereto;
(v) an
Escrow
Account Letter Agreement in the form of Exhibit
E-2
hereto;
and
(vi) the
Company’s Underwriting Guidelines for each of its origination
programs.
(b)
The
Closing Documents for the Loans to be purchased on each Closing Date
(including
the initial Closing Date) shall consist of fully executed originals of
the
following documents:
(i) the
related Trade Confirmation;
(ii)
if
requested by the Purchaser, an Officer’s Certificate, in the form of
Exhibit
I
hereto,
including all attachments thereto;
(iii) if
requested by the Purchaser, an Opinion of Counsel to the Company, in
the form of
Exhibit
J
hereto;
(iv) if
any of
the Mortgage Loans has at any time been subject to any security interest,
pledge
or hypothecation for the benefit of any Person, a Security Release
Certification, in the form of Exhibit
K
hereto,
executed by such Person;
(v) a
certificate or other evidence of merger or change of name, signed or
stamped by
the applicable regulatory authority, if any of the Mortgage Loans were
acquired
by the Company by merger or acquired or originated by the Company while
conducting business under a name other than its present name, if applicable;
and
(vi) an
Assignment and Conveyance, in the form of Exhibit
L
hereto.
(c) In
addition, to the extent that the Underwriting Guidelines are modified,
amended
or supplemented at any time following the initial Closing Date, the Company
shall notify the Purchaser of such change and provide the Purchaser a
copy in
both electronic and hard copy of such modification, amendment or supplement
no
later than five (5) Business Days following the effective date of such
modification, amendment or supplement.
17
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES;
REMEDIES
AND BREACH
Section
3.01
|
Company
Representations and Warranties.
|
The
Company represents and warrants to the Purchaser that as of each Closing
Date or
as of such date specifically provided herein:
(a) Due
Organization and Authority.
The
Company is a corporation duly organized, validly existing and in good
standing
under the laws of the State of Ohio and a first tier subsidiary of National
City
Bank of Indiana, a national banking association, and has all licenses
necessary
to carry on its business as now being conducted and is licensed, qualified
and
in good standing in each state where a Mortgaged Property is located
if the laws
of such state require licensing or qualification in order to conduct
business of
the type conducted by the Company, and in any event the Company is in
compliance
with the laws of any such state to the extent necessary to ensure the
enforceability of the related Mortgage Loan and the servicing of such
Mortgage
Loan in accordance with the terms of this Agreement; no licenses or approvals
obtained by the Company have been suspended or revoked by any court,
administrative agency, arbitrator or governmental body and no proceedings
are
pending which might result in such suspension or revocation; the Company
has the
full corporate power and authority to hold each Mortgage Loan, to sell
each
Mortgage Loan and to execute and deliver this Agreement and to perform
in
accordance herewith; the execution, delivery and performance of this
Agreement
(including all instruments of transfer to be delivered pursuant to this
Agreement) by the Company and the consummation of the transactions contemplated
hereby have been duly and validly authorized; this Agreement evidences
the
valid, binding and enforceable obligation of the Company; and all requisite
corporate action has been taken by the Company to make this Agreement
valid and
binding upon the Company in accordance with its terms;
(b) Ordinary
Course of Business.
The
consummation of the transactions contemplated by this Agreement are in
the
ordinary course of business of the Company, and the transfer, assignment
and
conveyance of the Mortgage Notes and the Mortgages by the Company pursuant
to
this Agreement are not subject to the bulk transfer or any similar statutory
provisions in effect in any applicable jurisdiction;
(c) No
Conflicts.
Neither
the execution and delivery of this Agreement, the acquisition of the
Mortgage
Loans by the Company, the sale of the Mortgage Loans to the Purchaser
or the
transactions contemplated hereby, nor the fulfillment of or compliance
with the
terms and conditions of this Agreement, will conflict with or result
in a breach
of any of the terms, conditions or provisions of the Company’s charter or
by-laws or any legal restriction or any agreement or instrument to which
the
Company is now a party or by which it is bound, or constitute a default
or
result in an acceleration under any of the foregoing, or result in the
violation
of any law, rule, regulation, order, judgment or decree to which the
Company or
its property is subject, or impair the ability of the Purchaser to realize
on
the Mortgage Loans, or impair the value of the Mortgage Loans;
18
(d) Ability
to Service.
The
Company is an approved seller/servicer of conventional residential mortgage
loans for Xxxxxx Mae or Xxxxxxx Mac and is a HUD approved mortgagee pursuant
to
Section 203 of the National Housing Act, with the facilities, procedures,
and
experienced personnel necessary for the sound servicing of mortgage loans
of the
same type as the Mortgage Loans. The Company is in good standing to sell
mortgage loans to and service mortgage loans for Xxxxxx Mae or Xxxxxxx
Mac, and
no event has occurred, including but not limited to a change in insurance
coverage, which would make the Company unable to comply with Xxxxxx Mae,
Xxxxxxx
Mac or HUD eligibility requirements or which would require notification
to
either Xxxxxx Mae, Xxxxxxx Mac or HUD;
(e) Reasonable
Servicing Fee.
The
Company acknowledges and agrees that the Servicing Fee, as calculated
at the
Servicing Fee Rate, represents reasonable compensation for performing
such
services and that the entire Servicing Fee shall be treated by the Company,
for
accounting and tax purposes, as compensation for the servicing and
administration of the Mortgage Loans pursuant to this Agreement.
(f) Ability
to Perform.
The
Company does not believe, nor does it have any reason or cause to believe,
that
it cannot perform each and every covenant contained in this Agreement.
The
Company is solvent and will not be rendered insolvent by the consummation
of the
transactions contemplated hereby. The sale of the Mortgage Loans is not
undertaken to hinder, delay or defraud any of the Company’s
creditors;
(g) No
Litigation Pending.
There
is no action, suit, proceeding or investigation pending or to the best
of the
Company’s knowledge threatened against the Company which, either in any one
instance or in the aggregate (i) may result in any material adverse change
in
the business, operations, financial condition, properties or assets of
the
Company, or in any material impairment of the right or ability of the
Company to
carry on its business substantially as now conducted, or in any material
liability on the part of the Company, or (ii) would prohibit the Company
from
entering into this Agreement or seek to prevent the sale of the Mortgage
Loans
or the consummation of the transactions contemplated by this Agreement
or (iii)
would otherwise draw into question the validity of this Agreement or
the
Mortgage Loans or of any action taken or to be taken in connection with
the
obligations of the Company contemplated herein, or (D) would be likely
to
prohibit or impair materially and adversely affect the performance by
the
Company of its obligations under, or the validity or enforceability of,
this
Agreement;
(h) No
Consent Required.
No
consent, approval, authorization or order of any court or governmental
agency or
body is required for the execution, delivery and performance by the Company
of
or compliance by the Company with this Agreement or the sale of the Mortgage
Loans as evidenced by the consummation of the transactions contemplated
by this
Agreement, or if required, such approval has been obtained prior to the
related
Closing Date;
(i) Selection
Process.
The
Mortgage Loans were selected from among the outstanding fixed rate one-
to
four-family or one- to two-family adjustable rate mortgage loans in the
Company’s portfolio at the related Closing Date as to which the representations
and warranties set forth in Section 3.02 could be made and such selection
(i)
was not made in a manner so as to affect adversely the interests of the
Purchaser and (ii) did not identify the Mortgage Loans as being less
desirable
or valuable than other comparable Mortgage Loans in the Company’s portfolio as
of the Cut-off Date;
19
(j) Pool
Characteristics.
With
respect to each Mortgage Loan Package, the Mortgage Loan characteristics
set
forth on the related Mortgage Loan Schedule attached to the related Assignment
and Conveyance are true and complete;
(k) No
Untrue Information.
Neither
this Agreement nor any statement, report or other document furnished
or to be
furnished pursuant to this Agreement or in connection with the transactions
contemplated hereby contains any untrue statement of fact or omits to
state a
fact necessary to make the statements contained therein not
misleading;
(l) Sale
Treatment.
The
disposition of the Mortgage Loans shall be treated as a sale on the books
and
records of the Company. The Company has determined that the disposition
of the
Mortgage Loans pursuant to this Agreement will be afforded sale treatment
for
accounting and tax purposes. The Company shall maintain a complete set
of books
and records for each Mortgage Loan, which shall be clearly marked to
reflect the
ownership of such Mortgage Loan;
(m) Financial
Statements.
To the
extent available, the Company has delivered to the Purchaser financial
statements as to its last three complete fiscal years and any later quarter
ended more than 60 days prior to the execution of this Agreement. All
such
financial statements fairly present the pertinent results of operations
and
changes in financial position at the end of each such period of the Company
and
its subsidiaries and have been prepared in accordance with generally
accepted
accounting principles consistently applied throughout the periods involved,
except as set forth in the notes thereto. There has been no change in
the
business, operations, financial condition, properties or assets of the
Company
since the date of the Company’s financial statements that would have a material
adverse effect on its ability to perform its obligations under this Agreement.
The Company has completed any forms requested by the Purchaser in a timely
manner and in accordance with the provided instructions;
(n) No
Brokers’ Fees.
The
Company has not dealt with any broker, investment banker, agent or other
person
that may be entitled to any commission or compensation in connection
with the
sale of the Mortgage Loans;
(o) Origination.
The
Company’s decision to originate any mortgage loan or to deny any mortgage loan
application is an independent decision based upon Company’s Underwriting
Guidelines, and is in no way made as a result of Purchaser’s decision to
purchase, or not to purchase, or the price Purchaser may offer to pay
for, any
such mortgage loan, if originated; and
(p) Fair
Consideration.
The
consideration received by the Company upon the sale of the Mortgage Loans
under
this Agreement constitutes fair consideration and reasonably equivalent
value
for the Mortgage Loans;
20
(q) MERS.
The
Company is a member of MERS in good standing, and will comply in all
material
respects with the rules and procedures of MERS in connection with the
servicing
of the MERS Mortgage Loans for as long as such Mortgage Loans are registered
with MERS.
Section
3.02
|
Representations
and Warranties Regarding Individual Mortgage Loans.
|
As
to
each Mortgage Loan, the Company hereby represents and warrants to the
Purchaser
that as of the related Closing Date:
(a) Mortgage
Loans as Described.
The
Mortgage Loan is in compliance with all requirements set forth in the
related
Trade Confirmation. The characteristics of the related Mortgage Loan
Package as
set forth in the related Trade Confirmation are complete, true and correct.
The
information set forth in the related Mortgage Loan Schedule and the Mortgage
Loan data delivered to the Purchaser is complete, true and correct;
(b) Payments
Current.
All
payments required to be made up to the related Closing Date for the Mortgage
Loan under the terms of the Mortgage Note have been made and credited.
No
payment required under the Mortgage Loan is delinquent nor has any payment
under
such Mortgage Loan been 30 or more days delinquent at any time since
origination. The first Monthly Payment shall be made with respect to
the
Mortgage Loan on its Due Date or within the grace period, all in accordance
with
the terms of the related Mortgage Note;
(c) No
Outstanding Charges.
There
are no defaults in complying with the terms of the Mortgages, and all
taxes,
governmental assessments, insurance premiums, ground rents, leasehold
payments,
water, sewer and municipal charges, leasehold payments or ground rents
which
previously became due and owing have been paid, or an escrow of funds
has been
established in an amount sufficient to pay for every such item which
remains
unpaid and which has been assessed but is not yet due and payable. The
Company
has not advanced funds, or induced, solicited or knowingly received any
advance
of funds by a party other than the Mortgagor, directly or indirectly,
for the
payment of any amount required under the Mortgage Loan, except for interest
accruing from the date of the Mortgage Note or date of disbursement of
the
Mortgage Loan proceeds, whichever is greater, to the day which precedes
by one
month the Due Date of the first installment of principal and interest;
(d) Original
Terms Unmodified.
The
terms of the Mortgage Note and Mortgage have not been impaired, waived,
altered
or modified in any respect, except by a written instrument which has
been
recorded, if necessary to protect the interests of the Purchaser and
which has
been delivered to the Custodian. The substance of any such waiver, alteration
or
modification has been approved by the issuer of any related PMI Policy
and the
title insurer, to the extent required by the policy, and its terms are
reflected
on the related Mortgage Loan Schedule. No instrument of waiver, alteration
or
modification has been executed, and no Mortgagor has been released, in
whole or
in part, except in connection with an assumption agreement approved by
the
issuer of any related PMI Policy and the title insurer, to the extent
required
by the policy, and which assumption agreement is part of the Mortgage
Loan File
delivered to the Custodian and the terms of which are reflected in the
related
Mortgage Loan Schedule;
21
(e) No
Defenses.
The
Mortgage Loan is not subject to any right of rescission, set-off, counterclaim
or defense, including without limitation the defense of usury, nor will
the
operation of any of the terms of the Mortgage Note or the Mortgage, or
the
exercise of any right thereunder, render either the Mortgage Note or
the
Mortgage unenforceable, in whole or in part, or subject to any right
of
rescission, set-off, counterclaim or defense, including without limitation
the
defense of usury, and no such right of rescission, set-off, counterclaim
or
defense has been asserted with respect thereto, and no Mortgagor was
a debtor in
any state or federal bankruptcy or insolvency proceeding at the time
the
Mortgage Loan was originated;
(f) Hazard
Insurance.
All
buildings or other improvements upon the Mortgaged Property are insured
by an
insurer acceptable to Xxxxxxx Mac and Xxxxxx Mae against loss by fire,
hazards
of extended coverage and such other hazards as are customary in the area
where
the Mortgaged Property is located pursuant to insurance policies conforming
to
the requirements of Section 4.10. If the Mortgaged Property is in an
area
identified in the Federal Register by the Federal Emergency Management
Agency as
having special flood hazards (and such flood insurance has been made
available)
a flood insurance policy meeting the requirements of the current guidelines
of
the Federal Flood Insurance Administration is in effect which policy
conforms to
the requirements of Section 4.10. All individual insurance policies contain
a
standard mortgagee clause naming the Company and its successors and assigns
as
mortgagee, and all premiums thereon have been paid. The Mortgage obligates
the
Mortgagor thereunder to maintain the hazard insurance policy at the Mortgagor’s
cost and expense, and on the Mortgagor’s failure to do so, authorizes the holder
of the Mortgage to obtain and maintain such insurance at such Mortgagor’s cost
and expense, and to seek reimbursement therefor from the Mortgagor. Where
required by state law or regulation, the Mortgagor has been given an
opportunity
to choose the carrier of the required hazard insurance, provided the
policy is
not a “master” or “blanket” hazard insurance policy covering the common
facilities of a planned unit development. The hazard insurance policy
is the
valid and binding obligation of the insurer, is in full force and effect,
and
will be in full force and effect and inure to the benefit of the Purchaser
upon
the consummation of the transactions contemplated by this Agreement.
The Company
has not engaged in, and has no knowledge of the Mortgagor, any Subservicer
or
any prior originator or subservicer having engaged in, any act or omission
which
would impair the coverage of any such policy, the benefits of the endorsement
provided for herein, or the validity and binding effect of either, including
without limitation, no unlawful fee, unlawful commission, unlawful kickback
or
other unlawful compensation or value of any kind has been or will be
received,
retained or realized by any attorney, firm or other person or entity,
and no
such unlawful items have been received, retained or realized by the
Company;
(g) Compliance
with Applicable Law.
Any and
all requirements of any federal, state or local law including, without
limitation, usury, truth in lending, real estate settlement procedures,
consumer
credit protection, equal credit opportunity, fair housing, disclosure
laws or
all predatory and abusive lending laws applicable to the origination
and
servicing of mortgage loans of a type similar to the Mortgage Loans have
been
complied with and the consummation of the transactions contemplated hereby
will
not involve the violation of any such laws, and the Company shall maintain
in
its possession, available for the inspection of the Purchaser or its
designee,
and shall deliver to the Purchaser or its designee, upon demand, evidence
of
compliance with such requirements;
22
(h) No
Satisfaction of Mortgage.
The
Mortgage has not been satisfied, canceled, subordinated or rescinded,
in whole
or in part, and the Mortgaged Property has not been released from the
lien of
the Mortgage, in whole or in part, nor has any instrument been executed
that
would effect any such release, cancellation, subordination or rescission.
The
Company has not waived the performance by the Mortgagor of any action,
if the
Mortgagor’s failure to perform such action would cause the Mortgage Loan to be
in default, nor has the Company waived any default resulting from any
action or
inaction by the Mortgagor;
(i) Location
and Type of Mortgaged Property.
The
Mortgaged Property is a fee simple property located in the state identified
in
the related Mortgage Loan Schedule and consists of a parcel of real property
with a detached single family residence erected thereon, or a two- to
four-family dwelling, or an individual condominium unit in a low-rise
condominium project, or an individual unit in a planned unit development,
provided,
however,
that
any
condominium project or planned unit development shall conform with the
Company’s
Underwriting Guidelines regarding such dwellings, and no residence or
dwelling
is a mobile home or a manufactured dwelling. No portion of the Mortgaged
Property is used for commercial purposes;
(j) Valid
First Lien.
The
Mortgage is a valid, subsisting, enforceable and perfected first lien
on the
Mortgaged Property, including all buildings and improvements on the Mortgaged
Property, and all additions, alterations and replacements made at any
time with
respect to the foregoing. The lien of the Mortgage is subject only
to:
(1) the
lien
of current real property taxes and assessments not yet due and
payable;
(2) covenants,
conditions and restrictions, rights of way, easements and other matters
of the
public record as of the date of recording acceptable to mortgage lending
institutions generally and specifically referred to in the lender’s title
insurance policy delivered to the originator of the Mortgage Loan and
(i)
referred to or to otherwise considered in the appraisal made for the
originator
of the Mortgage Loan or (ii) which do not adversely affect the Appraised
Value
of the Mortgaged Property set forth in such appraisal; and
(3) other
matters to which like properties are commonly subject which do not materially
interfere with the benefits of the security intended to be provided by
the
mortgage or the use, enjoyment, value or marketability of the related
Mortgaged
Property. Any
security agreement, chattel mortgage or equivalent document related to
and
delivered in connection with the Mortgage Loan establishes and creates
a valid,
subsisting and enforceable first lien and first priority security interest
on
the property described therein and the Company has full right to sell
and assign
the same to the Purchaser. The Mortgaged Property was not, as of the
date of
origination of the Mortgage Loan, subject to a mortgage, deed of trust,
deed to
secured debt or other security instrument creating a lien subordinate
to the
lien of the Mortgage;
23
(k) Validity
of Mortgage Documents.
The
Mortgage Note and the Mortgage are genuine, and each is the legal, valid
and
binding obligation of the maker thereof enforceable in accordance with
its
terms. All parties to the Mortgage Note and the Mortgage and any other
related
agreement had legal capacity to enter into the Mortgage Loan and to execute
and
deliver the Mortgage Note and the Mortgage and any other related agreement,
and
the Mortgage Note and the Mortgage have been duly and properly executed
by such
parties. The documents, instruments and agreements submitted for loan
underwriting were not falsified and contain no untrue statement of material
fact
or omit to state a material fact required to be stated therein or necessary
to
make the information and statements therein not misleading. No error,
negligence, fraud or similar occurrence was committed by any person,
including
without limitation, the Mortgagor, any appraiser, any builder or any
other party
involved in the origination of the Mortgage Loan or in the application
of any
insurance in relation to such Mortgage Loan. The Company has reviewed
all of the
documents constituting the Servicing File and has made such inquiries
as it
deems necessary to make and confirm the accuracy of the representations
set
forth herein;
(l) Full
Disbursement of Proceeds.
The
Mortgage Loan has been closed and the proceeds of the Mortgage Loan have
been
fully disbursed and there is no requirement for future advances thereunder,
and
any and all requirements as to completion of any on-site or off-site
improvement
and as to disbursements of any escrow funds therefor have been complied
with.
All costs, fees and expenses incurred in making or closing the Mortgage
Loan and
the recording of the Mortgage were paid, and the Mortgagor is not entitled
to
any refund of any amounts paid or due under the Mortgage Note or
Mortgage;
(m) Ownership.
The
Company is the sole owner of record and holder of the Mortgage Loan.
The
Mortgage Loan is not assigned or pledged, and the Company has good and
marketable title thereto, and has full right to transfer and sell the
Mortgage
Loan therein to the Purchaser free and clear of any encumbrance, equity,
participation interest, lien, pledge, charge, claim or security interest,
and
has full right and authority subject to no interest or participation
of, or
agreement with, any other party, to sell and assign each Mortgage Loan
pursuant
to this Agreement. In the event that the Company retains record title,
the
Company shall retain such record title to each Mortgage, each related
Mortgage
Note and the related Mortgage Files with respect thereto in trust for
the
Purchaser as the owner thereof and only for the purpose of servicing
and
supervising the servicing of each Mortgage Loan;
(n) Doing
Business.
All
parties which have had any interest in the Mortgage Loan, whether as
mortgagee,
assignee, pledgee or otherwise, are (or, during the period in which they
held
and disposed of such interest, were) (1) in compliance with any and all
applicable licensing requirements of the laws of the state wherein the
Mortgaged
Property is located, and (2) (a) organized under the laws of such state,
(b)
qualified to do business in such state, (c) federal savings and loan
associations or national banks having principal offices in such state,
or (d)
not doing business in such state;
(o) LTV,
PMI Policy.
At
origination, no Mortgage Loan had a LTV greater than 95% and no Mortgage
Loan
had a CLTV greater than 100% (or such other percentages as stated in
the related
Trade Confirmation). The original LTV of the Mortgage Loan either was
not more
than 80% (or such other percentage as stated in the related Trade Confirmation),
or (i) the excess over 75% is and will be insured as to payment defaults
by a
PMI Policy until the LTV of such Mortgage Loan is reduced to (A) 80%
(or such
other percentage as stated in the related Trade Confirmation) or (B)
that amount
for which Xxxxxx Xxx no longer requires such insurance to be maintained,
or (ii)
is subject to an LPMI Policy, which will stay in effect for the life
of the
Mortgage Loan. All provisions of such PMI Policy have been and are being
complied with, such policy is in full force and effect, and all premiums
due
thereunder have been paid. No action, inaction, or event has occurred
and no
state of facts exists that has, or will result in the exclusion from,
denial of,
or defense to coverage. Any Mortgage Loan subject to a PMI Policy obligates
the
Mortgagor thereunder to maintain the PMI Policy and to pay all premiums
and
charges in connection therewith; provided,
that,
with
respect to LPMI Loans, the related Servicer is obligated thereunder to
maintain
the LPMI Policy and to pay all premiums and charges in connection therewith.
The
Mortgage Interest Rate for the Mortgage Loan as set forth on the related
Mortgage Loan Schedule is net of any such insurance premium;
24
(p) Title
Insurance.
The
Mortgage Loan is covered by either (i) an attorney’s opinion of title and
abstract of title the form and substance of which is acceptable to mortgage
lending institutions making mortgage loans in the area where the Mortgaged
Property is located or (ii) an ALTA lender’s title insurance policy or other
generally acceptable form of policy of insurance acceptable to Xxxxxx
Xxx or
Xxxxxxx Mac, issued by a title insurer acceptable to Xxxxxx Mae or Xxxxxxx
Mac
and qualified to do business in the jurisdiction where the Mortgaged
Property is
located, insuring the Company, its successors and assigns, as to the
first
priority lien of the Mortgage in the original principal amount of the
Mortgage
Loan, subject only to the exceptions contained in clauses (1), (2) and
(3) of
paragraph (j) of this Section 3.02. Where required by state law or regulation,
the Mortgagor has been given the opportunity to choose the carrier of
the
required mortgage title insurance. Additionally, such lender’s title insurance
policy affirmatively insures ingress and egress, and against encroachments
by or
upon the Mortgaged Property or any interest therein. The Company is the
sole
insured of such lender’s title insurance policy, and such lender’s title
insurance policy is in full force and effect and will be in force and
effect
upon the consummation of the transactions contemplated by this Agreement.
No
claims have been made under such lender’s title insurance policy, and no prior
holder of the Mortgage, including the Company, has done, by act or omission,
anything which would impair the coverage of such lender’s title insurance policy
including without limitation, no unlawful fee, commission, kickback or
other
unlawful compensation or value of any kind has been or will be received,
retained or realized by any attorney, firm or other person or entity,
and no
such unlawful items have been received, retained or realized by the
Company;
(q) No
Defaults.
There
is no default, breach, violation or event of acceleration existing under
the
Mortgage or the Mortgage Note and no event which, with the passage of
time or
with notice and the expiration of any grace or cure period, would constitute
a
default, breach, violation or event of acceleration, and neither the
Company nor
its predecessors have waived any default, breach, violation or event
of
acceleration;
(r) No
Mechanics’ Liens.
There
are no mechanics’ or similar liens or claims which have been filed for work,
labor or material (and no rights are outstanding that under the law could
give
rise to such liens) affecting the related Mortgaged Property which are
or may be
liens prior to, or equal or coordinate with, the lien of the related
Mortgage;
25
(s) Location
of Improvements; No Encroachments.
All
improvements which were considered in determining the Appraised Value
of the
Mortgaged Property lay wholly within the boundaries and building restriction
lines of the Mortgaged Property and no improvements on adjoining properties
encroach upon the Mortgaged Property. No improvement located on or being
part of
the Mortgaged Property is in violation of any applicable zoning law or
regulation;
(t) Origination:
Payment Terms.
Such
Mortgage Loan was originated by the Company, a credit union, a savings
and loan
association, a savings bank, a commercial bank, a mortgage banking company
or a
similar banking institution which is supervised and examined by a federal
or
state credit union or banking authority, or is a mortgagee approved by
HUD.
Principal payments on the Mortgage Loan shall commence (with respect
to any
newly originated Mortgage Loans) or commenced no more than sixty days
after the
proceeds of the Mortgage Loan were disbursed. The Mortgage Loan bears
interest
at the Mortgage Interest Rate calculated and payable in arrears. With
respect to
each Mortgage Loan, the Mortgage Note is payable on the first day of
each month
in Monthly Payments, which (i) in the case of a Fixed Rate Mortgage Loan
are
sufficient to fully amortize the original principal balance over the
original
term thereof and to pay interest at the related Mortgage Interest Rate,
(ii) in
the case of an Adjustable Rate Mortgage Loan, are changed on each Adjustment
Date, and in any case, are sufficient to fully amortize the original
principal
balance over the original term thereof and to pay interest at the related
Mortgage Interest Rate and (iii) in the case of a Balloon Loan, are based
on a
fifteen (15) or thirty (30) year amortization schedule, as set forth
in the
related Mortgage Note, and a final Monthly Payment substantially greater
than
the preceding Monthly Payment which is sufficient to amortize the remaining
principal balance of the Balloon Loan and to pay interest at the related
Mortgage Interest Rate. No Balloon Loan has an original stated maturity
of less
than seven (7) years. The Index for each Adjustable Rate Mortgage Loan
is as
defined in the Mortgage Loan Schedule. The Mortgage Note does not permit
negative amortization. No Mortgage Loan is a Convertible Mortgage Loan;
(u) Customary
Provisions.
The
Mortgage contains customary and enforceable provisions such as to render
the
rights and remedies of the holder thereof adequate for the realization
against
the Mortgaged Property of the benefits of the security provided thereby,
including, (i) in the case of a Mortgage designated as a deed of trust,
by
trustee’s sale, and (ii) otherwise by judicial foreclosure. The Mortgaged
Property has not been subject to any bankruptcy proceeding or foreclosure
proceeding during the term of the applicable Mortgage Loan and the Mortgagor
has
not filed for protection under applicable bankruptcy laws. Upon default
by a
Mortgagor on a Mortgage Loan and foreclosure on, or trustee’s sale of, the
Mortgaged Property pursuant to the proper procedures, the holder of the
Mortgage
Loan will be able to deliver good and merchantable title to the Mortgaged
Property. There is no homestead or other exemption available to a Mortgagor
which would interfere with the right to sell the Mortgaged Property at
a
trustee’s sale or the right to foreclose the Mortgage;
(v) No
“Buydowns”. No
Mortgage Loan contains provisions pursuant to which Monthly Payments
are (i)
paid or partially paid with funds deposited in any separate account established
by the Company, the Mortgagor, or anyone on behalf of the Mortgagor,
(ii) paid
by any source other than the Mortgagor or (iii) contains any other similar
provisions which may constitute a “buy-down” provision. The Mortgage Loan is not
a graduated payment mortgage loan and the Mortgage Loan does not have
a shared
appreciation or other contingent interest feature;
26
(w) Compliance
with Disclosure Requirements. The
Mortgagor has executed a statement to the effect that the Mortgagor has
received
all disclosure materials required by applicable law and rescission materials
with respect to Refinanced Mortgage Loans, and such statement is and
will remain
in the Mortgage File;
(x) No
Construction or Rehabilitation Loans.
No
Mortgage Loan was made in connection with (i) the construction or rehabilitation
of a Mortgaged Property or (ii) facilitating the trade-in or exchange
of a
Mortgaged Property;
(y) Conformance
with Underwriting Guidelines.
The
Mortgage Loan was underwritten in accordance with the Company’s Underwriting
Guidelines in effect at the time the Mortgage Loan was originated. The
Mortgage
Loan is in conformity with the standards of Xxxxxxx Mac or Xxxxxx Mae
under one
of their respective home mortgage purchase programs (except that the
principal
balance of certain Mortgage Loans may have exceeded the limits of Xxxxxx
Xxx and
Xxxxxxx Mac) and the Mortgage Note and Mortgage are on forms acceptable
to
Xxxxxxx Mac or Xxxxxx Xxx;
(z) Occupancy
of the Mortgaged Property.
As of
the related Closing Date the Mortgaged Property is lawfully occupied
under
applicable law. All inspections, licenses and certificates required to
be made
or issued with respect to all occupied portions of the Mortgaged Property
and,
with respect to the use and occupancy of the same, including but not
limited to
certificates of occupancy and fire underwriting certificates, have been
made or
obtained from the appropriate authorities. Except as otherwise stated
on the
Mortgage Loan Schedule, the Mortgagor represented at the time of origination
of
the Mortgage Loan that the Mortgagor would occupy the Mortgaged Property
as the
Mortgagor’s primary residence;
(aa) No
Additional Collateral.
The
Mortgage Note is not and has not been secured by any collateral except
the lien
of the corresponding Mortgage and the security interest of any applicable
security agreement or chattel mortgage referred to in (j) above;
(bb) Deeds
of Trust.
In the
event the Mortgage constitutes a deed of trust, a trustee, duly qualified
under
applicable law to serve as such, has been properly designated and currently
so
serves and is named in the Mortgage, and no fees or expenses are or will
become
payable by the Purchaser to the trustee under the deed of trust, except
in
connection with a trustee’s sale after default by the Mortgagor;
(cc) Acceptable
Investment.
The
Company has no knowledge of any circumstances or conditions with respect
to the
Mortgage, the Mortgaged Property, the Mortgagor or the Mortgagor’s credit
standing that can reasonably be expected to cause private institutional
investors to regard the Mortgage Loan as an unacceptable investment,
cause the
Mortgage Loan to become delinquent, or adversely affect the value or
marketability of the Mortgage Loan;
(dd) Delivery
of Mortgage Documents.
The
Mortgage Note, the Mortgage, the Assignment of Mortgage and any other
documents
required to be delivered for the Mortgage Loan by the Company under this
Agreement as set forth in Exhibit
C
attached
hereto have been delivered to the Custodian. The Company is in possession
of a
complete, true and accurate Mortgage File in compliance with Exhibit
B,
except
for such documents the originals of which have been delivered to the
Custodian;
27
(ee) Condominiums/Planned
Unit Developments.
If the
dwelling on the Mortgaged Property is a condominium unit or a planned
unit
development (other than a de minimus planned unit development) such condominium
or planned unit development project meets Xxxxxx Mae and Xxxxxxx Mac
eligibility
requirements.
(ff) Transfer
of Mortgage Loans.
The
Assignment of Mortgage is in recordable form and is acceptable for recording
under the laws of the jurisdiction in which the Mortgaged Property is
located;
(gg) Due
on
Sale.
The
Mortgage contains an enforceable provision for the acceleration of the
payment
of the unpaid principal balance of the Mortgage Loan, except as prohibited
by
applicable law, in the event that the Mortgaged Property is sold or transferred
without the prior written consent of the Mortgagor thereunder;
(hh) Consolidation
of Future Advances.
Any
principal advances made prior to the related Cut-off Date have been consolidated
with the outstanding principal amount secured by the Mortgage, and the
secured
principal amount, as consolidated, bears a single interest rate and single
repayment term. The lien of the Mortgage securing the consolidated principal
amount is expressly insured as having first lien priority by a title
insurance
policy, an endorsement to the policy insuring the mortgagee’s consolidated
interest or by other title evidence acceptable to Xxxxxx Xxx and Xxxxxxx
Mac.
The consolidated principal amount does not exceed the original principal
amount
of the Mortgage Loan;
(ii) Mortgaged
Property Undamaged.
There
is no proceeding pending or, to the best of the Company’s knowledge, threatened
for the total or partial condemnation of the Mortgaged Property. The
Mortgaged
Property is undamaged by waste, fire, earthquake or earth movement, windstorm,
flood, tornado or other casualty so as to affect adversely the value
of the
Mortgaged Property as security for the Mortgage Loan or the use for which
the
premises were intended;
(jj) Collection
Practices; Escrow Deposits.
The
origination, servicing and collection practices used with respect to
the
Mortgage Loan have been in accordance with Accepted Servicing Practices,
and
have been in all respects in compliance with all applicable laws and
regulations. The Mortgage Loan has been serviced by the Company and any
predecessor servicer in accordance with the terms of the Mortgage Note
and
Mortgage, and the FNMA servicing guides. With respect to escrow deposits
and
Escrow Payments, all such payments are in the possession of the Company
and
there exist no deficiencies in connection therewith for which customary
arrangements for repayment thereof have not been made. All Escrow Payments
have
been collected in full compliance with state and federal law. An escrow
of funds
is not prohibited by applicable law and has been established in an amount
sufficient to pay for every item which remains unpaid and which has been
assessed but is not yet due and payable. No escrow deposits or Escrow
Payments
or other charges or payments due the Company have been capitalized under
the
Mortgage or the Mortgage Note and no such escrow deposits or Escrow Payments
are
being held by the Company for any work on a Mortgaged Property which
has not
been completed;
28
(kk) Appraisal.
The
Mortgage File contains an appraisal of the related Mortgage Property
which
satisfied the standards of Xxxxxx Xxx and Xxxxxxx Mac and was made and
signed
prior to the approval of the Mortgage Loan application by a qualified
appraiser,
duly appointed by the Company (i) who had no interest, direct or indirect
in the
Mortgaged Property or in any loan made on the security thereof and who
met the
minimum qualifications of Xxxxxx Mae and Xxxxxxx Mac, and (ii) whose
compensation is not affected by the approval or disapproval of the Mortgage
Loan. The appraisal and appraiser both satisfy the requirements of Title XI
of the Federal Institutions Reform, Recovery, and Enforcement Act of
1989 and
the regulations promulgated thereunder, all as in effect on the date
the
Mortgage Loan was originated;
(ll) Servicemembers
Civil Relief Act.
The
Mortgagor has not notified the Company, and the Company has no knowledge
of any
relief requested or allowed to the Mortgagor under the Servicemembers
Civil
Relief Act;
(mm) Environmental
Matters.
The
Mortgaged Property is free from any and all toxic or hazardous substances
and
there exists no violation of any local, state or federal environmental
law, rule
or regulation. To the best of the Company’s knowledge, there is no pending
action or proceeding directly involving any Mortgaged Property of which
the
Company is aware in which compliance with any environmental law, rule
or
regulation is an issue; and to the best of the Company’s knowledge, nothing
further remains to be done to satisfy in full all requirements of each
such law,
rule or regulation consisting a prerequisite to use and enjoyment of
said
property;
(nn) Insurance.
The
Company has caused or will cause to be performed any and all acts required
to
preserve the rights and remedies of the Purchaser in any insurance policies
applicable to the Mortgage Loans including, without limitation, any necessary
notifications of insurers, assignments of policies or interests therein,
and
establishments of coinsured, joint loss payee and mortgagee rights in
favor of
the Purchaser. No action, inaction, or event has occurred and no state
of fact
exists or has existed that has resulted or will result in the exclusion
from,
denial of, or defense to coverage under any applicable pool insurance
policy,
special hazard insurance policy, PMI Policy or bankruptcy bond, irrespective
of
the cause of such failure of coverage. In connection with the placement
of any
such insurance, no commission, fee, or other compensation has been or
will be
received by the Company or any designee of the Company or any corporation
in
which the Company or any officer, director, or employee had a financial
interest
at the time of placement of such insurance;
(oo) Regarding
the Mortgagor.
The
Mortgagor is one or more natural persons. No Mortgagor is the obligor
on more
than two Mortgage Notes in any Mortgage Loan Package;
(pp) Compliance
with Texas Law Requirements.
Each
Mortgage Loan originated in the state of Texas pursuant to Article XVI,
Section
50(a)(6) of the Texas Constitution (a “Texas Refinance Loan”) has been
originated in compliance with the provisions of Article XVI, Section
50(a)(6) of
the Texas Constitution, Texas Civil Statutes and the Texas Finance Code.
With
respect to each Texas Refinance Loan that is a Cash-Out Refinancing,
the related
Mortgage Loan Documents state that the Mortgagor may prepay such Texas
Refinance
Loan in whole or in part without incurring a Prepayment Charge. The Company
does
not collect any such Prepayment Charges in connection with any such Texas
Refinance Loan;
29
(qq) Interest
Rate Calculation.
Interest on each Mortgage Loan is calculated on the basis of a 360-day
year
consisting of twelve 30-day months;
(rr) Qualified
Mortgage.
Each
Mortgage Loan constitutes a “qualified mortgage” under Section 860G(a)(3)(A) of
the Code and Treasury Regulation Section 1.860G-2(a)(1);
(ss) Predatory
Lending Regulations; High Cost Loans.
No
Mortgage Loan is (a) subject to, covered by or in violation of the provisions
of
the Homeownership and Equity Protection Act of 1994, as amended, (b)
a “high
cost”, “covered”, “abusive”, “predatory”, “home loan”, “Oklahoma Section 10” or
“high risk” mortgage loan (or a similarly designated loan using different
terminology) under any federal, state or local law, including without
limitation, the provisions of the Georgia Fair Lending Act, New York
Banking
Law, Section 6-1, the City of Oakland, California Anti-Predatory Lending
Ordinance No. 12361, the Arkansas Home Loan Protection Act, effective
as of June
14, 2003, Kentucky State Statute KRS 360.100, effective as of June 25,
2003, the
New Jersey Home Ownership Security Act of 2002 (the “NJ Act”), the New Mexico
Home Loan Protection Act (N.M. Stat. Xxx. §§ 58-21A-1 et seq.), the Illinois
High-Risk Home Loan Act (815 Ill. Comp. Stat. 137/1 et seq.), the Oklahoma
Home
Ownership and Equity Protection Act, Nevada Assembly Xxxx No. 284, effective
as
of Oct. 1, 2003, the Minnesota Residential Mortgage Originator and Servicer
Licensing Act (MN Stat. §58.137), the South Carolina High-Cost and Consumer Home
Loans Act, effective January 1, 2004, the
Massachusetts Predatory Home Loan Practices Act, effective November 7,
2004
(Mass. Xxx. Laws Ch. 183C)
or any
other statute or regulation providing assignee liability to holders of
such
mortgage loans, or (c) subject to or in violation of any such or comparable
federal, state or local statutes or regulations. No Mortgage Loan originated
or
modified on or after October 1, 2002 and prior to March 7, 2003 is secured
by a
Mortgaged Property located in the State of Georgia;
(tt) Simple
Interest Mortgage Loans.
None of
the Mortgage Loans are simple interest Mortgage Loans;
(uu) Single
Premium Credit Life Insurance.
No
Mortgagor was required to purchase any credit life, disability, accident
or
health insurance product or
debt
cancellation agreement
as a
condition of obtaining the extension of credit. No Mortgagor obtained
a prepaid
single premium credit life, disability, accident or health insurance
policy in
connection with the origination of the Mortgage Loan, and no proceeds
from any
Mortgage Loan were used to finance single-premium credit insurance policies
or
debt
cancellation agreements
as part
of the origination of, or as a condition to closing, such Mortgage
Loan;
(vv) Tax
Service Contract.
The
Company has obtained a life of loan, transferable real estate Tax Service
Contract on each Mortgage Loan with an Approved Tax Servicer Contract
Provider
and such contract is assignable without penalty, premium or cost to the
Purchaser;
30
(ww) Flood
Certification Contract.
The
Company has obtained a life of loan, transferable flood certification
contract
with an Approved Flood Policy Insurer acceptable to Purchaser in its
sole
discretion for each Mortgage Loan and such contract is assignable without
penalty, premium or cost to the Purchaser;
(xx) FICO
Scores.
Each
Mortgage Loan has a non-zero FICO score and a minimum FICO as set forth
in the
related Trade Confirmation;
(yy) Debt-to-Income
Ratio.
Each
Mortgagor has a debt-to-income ratio of less than or equal to the amount
set
forth in the related Trade Confirmation;
(zz) Prepayment
Charge.
With
respect to each Mortgage Loan that has a Prepayment Charge, each such
Prepayment
Charge is enforceable and will be enforced by the Company, and each Prepayment
Charge is permitted pursuant to applicable federal, state and local law.
No
Mortgage Loan originated prior to October 1, 2002 has a Prepayment Charge
longer
than five years after its origination; and no Mortgage Loan originated
after
October 1, 2002 has a Prepayment Charge longer than three years after
its
origination. Except as otherwise set forth in the related Mortgage Loan
Schedule, with respect to each Mortgage Loan that contains a Prepayment
Charge,
such Prepayment Charge is at least equal to the lesser of (a) the maximum
amount
permitted under applicable law and (b) six months interest at the related
Mortgage Interest Rate on the amount prepaid in excess of 20% of the
original
principal balance of such Mortgage Loan;
(aaa) Recordation.
Each
original Mortgage was recorded and all subsequent assignments of the
original
Mortgage (other than the assignment to the Purchaser) have been recorded
in the
appropriate jurisdictions wherein such recordation is necessary to perfect
the
lien thereof as against creditors of the Company, or is in the process
of being
recorded;
(bbb) Leaseholds.
No
mortgaged property is secured by a leasehold, cooperative or manufactured
housing. No Mortgage Loans are agricultural loans.
(ccc) Payment
in Full.
No
Mortgage Loan will be paid in full on or prior to the related Closing
Date;
(ddd) MERS
Assignments.
With
respect to each MERS Mortgage Loan, a MIN has been assigned by MERS and
such MIN
is accurately provided on the related Mortgage Loan Schedule. The related
assignment of Mortgage to MERS has been duly and properly recorded;
(eee) MERS
Notice of Liens.
With
respect to each MERS Mortgage Loan, the Company has not received any
notice of
liens or legal actions with respect to such Mortgage Loan and no such
notices
have been electronically posted by MERS;
(fff) Fair
Credit Reporting Act.
The
Company and any predecessor servicer has fully furnished, in accordance
with the
Fair Credit Reporting Act and its implementing regulations, accurate
and
complete information (e.g., favorable and unfavorable) on its borrower
credit
files to Equifax, Experian and Trans Union Credit Information Company
(three of
the credit repositories), on a monthly basis; and the Company will fully
furnish, in accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information (e.g., favorable and unfavorable)
on its borrower credit files to Equifax, Experian and Trans Credit Information
Company (three of the credit repositories), on a monthly basis;
31
(ggg) Extension
of Credit.
No
predatory, abusive or deceptive lending practices, including but not
limited to,
the extension of credit to a Mortgagor without regard for the Mortgagor’s
ability to repay the Mortgage Loan and the extension of credit to a Mortgagor
which has no tangible net benefit to the Mortgagor, were employed in
connection
with the origination of the Mortgage Loan. Each Mortgage Loan is in compliance
with the anti-predatory lending eligibility for purchase requirements
of FNMA’s
Selling Guide;
(hhh) Prepayment
Charge.
With
respect to any Mortgage Loan that contains a provision permitting imposition
of
a Prepayment Charge upon a Principal Prepayment prior to maturity: (i)
prior to
the Mortgage Loan’s origination, the Mortgagor agreed to such Prepayment Charge
in exchange for a monetary benefit, including but not limited to a Mortgage
Interest Rate or fee reduction, (ii) prior to the Mortgage Loan’s origination,
the Mortgagor was offered the option of obtaining a Mortgage Loan that
did not
require payment of a Prepayment Charge, (iii) the Prepayment Charge is
disclosed
to the Mortgagor in the Mortgage Loan Documents pursuant to applicable
state and
federal law, and (iv) notwithstanding any state or federal law to the
contrary,
the Company shall not impose such Prepayment Charge in any instance when
the
Mortgage debt is accelerated as the result of the Mortgagor’s default in making
the Monthly Payments;
(iii) PATRIOT
Act.
The
Company has complied with all applicable anti-money laundering laws and
regulations, including without limitation the USA PATRIOT Act of 2001
(collectively, the “Anti-Money Laundering Laws”). The Company has established an
anti-money laundering compliance program as required by the Anti-Money
Laundering Laws, has conducted the requisite due diligence in connection
with
the origination of each Mortgage Loan for purposes of the Anti-Money
Laundering
Laws, including with respect to the legitimacy of the applicable Mortgagor
and
the origin of the assets used by the said Mortgagor to purchase the property
in
question, and maintains, and will maintain, sufficient information to
identify
the applicable Mortgagor for purposes of the Anti-Money Laundering Laws;
no
Mortgage Loan is subject to nullification pursuant to Executive Order
13224 (the
“Executive Order”) or the regulations promulgated by the Office of Foreign
Assets Control of the United States Department of the Treasury (the “OFAC
Regulations”) or in violation of the Executive Order or the OFAC Regulations,
and no Mortgagor is subject to the provisions of such Executive Order
or the
OFAC Regulations nor listed as a “blocked person” for purposes of the OFAC
Regulations;
(jjj) Higher
Cost Loans.
No
Mortgagor was encouraged or required to select a Mortgage Loan product
offered
by the Company which is a higher cost product designed for less creditworthy
borrowers, unless at the time of the related Mortgage Loan’s origination, such
Mortgagor did not qualify taking into account credit history and debt
to income
ratios for a lower cost credit product then offered by the Company or
any
affiliate of the Company. If, at the time of the related loan application,
the
Mortgagor may have qualified for a lower cost credit product then offered
by any
mortgage lending affiliate of the Company, the Company referred the Mortgagor’s
application to such affiliate for underwriting consideration;
32
(kkk) Underwriting
Methodology.
The
methodology used in underwriting the extension of credit for each Mortgage
Loan
employs objective mathematical principles which relate the Mortgagor’s income,
assets and liabilities to the proposed payment and such underwriting
methodology
does not rely on the extent of the Mortgagor’s equity in the collateral as the
principal determining factor in approving such credit extension. Such
underwriting methodology confirmed that at the time of origination
(application/approval) the Mortgagor had a reasonable ability to make
timely
payments on the Mortgage Loan;
(lll) Finance
Charges.
All
points, fees and charges, including finance charges (whether or not financed,
assessed, collected or to be collected), in connection with the origination
and
servicing of each Mortgage Loan were disclosed in writing to the related
Mortgagor in accordance with applicable state and federal law and regulation.
Except in the case of a Mortgage Loan in an original principal amount
of less
than $60,000 which would have resulted in an unprofitable origination,
no
related Mortgagor was charged “points and fees” (whether or not financed) in an
amount greater than 5% of the principal amount of such loan, such 5%
limitation
is calculated in accordance with FNMA’s anti-predatory lending requirements as
set forth in the FNMA Selling Guide;
(mmm) Arbitration.
With
respect to each Mortgage Loan, neither the related Mortgage nor the related
Mortgage Note requires the Mortgagor to submit to arbitration to resolve
any
dispute arising out of or relating in any way to the Mortgage Loan
transaction;
(nnn) Illinois
Interest Act.
With
respect to any Mortgage Loan for which a mortgage loan application was
submitted
by the Mortgagor after April 1, 2004, no such Mortgage Loan secured by
a
Mortgage Property located in the State of Illinois is in violation of
the
provisions of the Illinois Interest Act, including Section 4.1a which
provides
that no such Mortgage Loan with a Mortgage Interest Rate in excess of
8.0% per
annum has lender-imposed fees (or other charges) in excess of 3.0% of
the
original principal balance of the Mortgage Loan; and
(ooo) No
MA
Refi.
No
Mortgage Loan originated on or after November 7, 2004 secured by a Mortgaged
Property located in the State of Massachusetts is a Refinanced Mortgage
Loan.
Section
3.03
|
Remedies
for Breach of Representations and Warranties.
|
It
is
understood and agreed that the representations and warranties set forth
in
Sections 3.01 and 3.02 shall survive the sale of the Mortgage Loans to
the
Purchaser and the delivery of the Mortgage Loan Documents to the Custodian
and
shall inure to the benefit of the Purchaser, notwithstanding any restrictive
or
qualified endorsement on any Mortgage Note or Assignment of Mortgage
or the
examination or failure to examine any Mortgage File. Upon discovery by
either
the Company or the Purchaser of a breach of any of the foregoing representations
and warranties which materially and adversely affects the value of the
Mortgage
Loans or the interest of the Purchaser, or which materially and adversely
affects the interests of Purchaser in the related Mortgage Loan in the
case of a
representation and warranty relating to a particular Mortgage Loan (in
the case
of any of the foregoing, a “Breach”),
the
party discovering such Breach shall give prompt written notice to the
other.
33
With
respect to those representations and warranties which are made to the
best of
the Company’s knowledge, if it is discovered by the Company or the Purchaser
that the substance of such representation and warranty is inaccurate
and such
inaccuracy materially and adversely affects the value of the related
Mortgage
Loan or the interest of the Purchaser (or which materially and adversely
affects
the value of a Mortgage Loan or the interests of the Purchaser in the
related
Mortgage Loan in the case of a representation and warranty relating to
a
particular Mortgage Loan), notwithstanding the Company’s lack of knowledge with
respect to the substance of such representation and warranty, such inaccuracy
shall be deemed a breach of the applicable representation and
warranty.
Within
60
days of the earlier of either discovery by or notice to the Company of
any
Breach of a representation or warranty, the Company shall use its best
efforts
promptly to cure such Breach in all material respects and, if such Breach
cannot
be cured, the Company shall, at the Purchaser’s option, repurchase such Mortgage
Loan at the Repurchase Price. In the event that a Breach shall involve
any
representation or warranty set forth in Section 3.01, and such Breach
cannot be
cured within 60 days of the earlier of either discovery by or notice
to the
Company of such Breach, all of the Mortgage Loans shall, at the Purchaser’s
option be repurchased by the Company at the Repurchase Price; provided,
that
if such
Breach may be cured by the repurchase of one or more individual Mortgage
Loans,
the Company may repurchase only those Mortgage Loans necessary to cure
the
Breach. However, if the Breach shall involve a representation or warranty
set
forth in Section 3.02 and the Company discovers or receives notice of
any such
Breach within 120 days of the related Closing Date, the Company shall,
at the
Purchaser’s option and provided that the Company has a Qualified Substitute
Mortgage Loan, rather than repurchase the Mortgage Loan as provided above,
remove such Mortgage Loan (a “Deleted
Mortgage Loan”)
and
substitute in its place a Qualified Substitute Mortgage Loan or Loans,
provided that
any such
substitution shall be effected not later than 120 days after the related
Closing
Date. If the Company has no Qualified Substitute Mortgage Loan, it shall
repurchase the deficient Mortgage Loan. Any repurchase of a Mortgage
Loan or
Loans pursuant to the foregoing provisions of this Section 3.03 shall
occur on a
date designated by the Purchaser and shall be accomplished by deposit
in the
Custodial Account of the amount of the Repurchase Price for distribution
to
Purchaser on the next scheduled Remittance Date, after deducting therefrom
any
amount received in respect of such repurchased Mortgage Loan or Loans
and being
held in the Custodial Account for future distribution. Notwithstanding
anything
to the contrary contained herein, it is understood by the parties hereto
that a
breach of the representations and warranties made in Subsections 3.02(ss),
(uu),
(zz), (fff) or (mmm) will be deemed to materially and adversely affect
the value
of the related Mortgage Loan or the interest of the Purchaser
therein.
If
pursuant to the foregoing provisions the Company repurchases a Mortgage
Loan
that is a MERS Mortgage Loan, the Company shall either (i) cause MERS
to execute
and deliver an assignment of the Mortgage in recordable form to transfer
the
Mortgage from MERS to the Company and shall cause such Mortgage to be
removed
from registration on the MERS System in accordance with MERS’ rules and
regulations or (ii) cause MERS to designate on the MERS System the Company
as
the beneficial holder of such Mortgage Loan.
34
At
the
time of repurchase or substitution, the Purchaser and the Company shall
arrange
for the reassignment of the Deleted Mortgage Loan to the Company and
the
delivery to the Company of any documents held by the Custodian relating
to the
Deleted Mortgage Loan. In the event of a repurchase or substitution,
the Company
shall, simultaneously with such reassignment, give written notice to
the
Purchaser that such repurchase or substitution has taken place, amend
the
related Mortgage Loan Schedule to reflect the withdrawal of the Deleted
Mortgage
Loan from this Agreement, and, in the case of substitution, identify
a Qualified
Substitute Mortgage Loan and amend the related Mortgage Loan Schedule
to reflect
the addition of such Qualified Substitute Mortgage Loan to this Agreement.
In
connection with any such substitution, the Company shall be deemed to
have made
as to such Qualified Substitute Mortgage Loan the representations and
warranties
set forth in this Agreement except that all such representations and
warranties
set forth in this Agreement shall be deemed made as of the date of such
substitution. The Company shall effect such substitution by delivering
to the
Custodian for such Qualified Substitute Mortgage Loan the documents required
by
Section 2.03, with the Mortgage Note endorsed as required by Section
2.03. No
substitution will be made in any calendar month after the Determination
Date for
such month. The Company shall deposit in the Custodial Account the Monthly
Payment less the Servicing Fee due on such Qualified Substitute Mortgage
Loan or
Loans in the month following the date of such substitution. Monthly Payments
due
with respect to Qualified Substitute Mortgage Loans in the month of substitution
shall be retained by the Company. For the month of substitution, distributions
to Purchaser shall include the Monthly Payment due on any Deleted Mortgage
Loan
in the month of substitution, and the Company shall thereafter be entitled
to
retain all amounts subsequently received by the Company in respect of
such
Deleted Mortgage Loan.
For
any
month in which the Company substitutes a Qualified Substitute Mortgage
Loan for
a Deleted Mortgage Loan, the Company shall determine the amount (if any)
by
which the aggregate principal balance of all Qualified Substitute Mortgage
Loans
as of the date of substitution is less than the aggregate Stated Principal
Balance of all Deleted Mortgage Loans (after application of scheduled
principal
payments due in the month of substitution). An amount equal to the product
of
such shortfall multiplied by the percentage of par set forth in the definition
of “Repurchase Price” shall be distributed by the Company in the month of
substitution pursuant to Section 5.01. Accordingly, on the date of such
substitution, the Company shall deposit from its own funds into the Custodial
Account an amount equal to such amount.
In
addition to such cure, repurchase and substitution obligation, the Company
shall
indemnify the Purchaser and hold it harmless against any losses, damages,
penalties, fines, forfeitures, reasonable and necessary legal fees and
related
costs, judgments, and other costs and expenses resulting from any claim,
demand,
defense or assertion based on or grounded upon, or resulting from, a
breach of
the Company’s representations and warranties contained in this Section 3. It is
understood and agreed that the obligations of the Company set forth in
this
Subsection 3.03 to cure or repurchase a defective Loan and to indemnify
the
Purchaser as provided in this Subsection 3.03 constitute the sole remedies
of
the Purchaser respecting a breach of the foregoing representations and
warranties.
35
Any
cause
of action against the Company relating to or arising out of the Breach
of any
representations and warranties made in Sections 3.01 and 3.02 shall accrue
as to
any Mortgage Loan upon (i) discovery of such Breach by the Purchaser
or notice
thereof by the Company to the Purchaser, (ii) failures by the Company
to cure
such Breach or repurchase such Mortgage Loan as specified above, and
(iii)
demand upon the Company by the Purchaser for compliance with this
Agreement.
Section
3.04
|
Repurchase
of Certain Mortgage Loans; Premium
Recapture.
|
In
the
event that any Mortgage Loan prepays-in-full within the period of time
from the
related Closing Date set forth in the related Trade Confirmation, the
Company
shall remit to the Purchaser the greater of (a) the Premium with respect
to such
prepaid Mortgage Loan or (b) the amount of any Prepayment Charges paid
with
respect to such Mortgage Loan. With respect to any Mortgage Loan, if
the related
Mortgagor fails to make the first or second scheduled Monthly Payment
or such
other scheduled Monthly Payments as may otherwise be set forth in the
related
Trade Confirmation due to the Purchaser on such Mortgage Loan within
the
calendar month such payment is due, the Company shall repurchase such
Mortgage
Loan at the related Purchase Price; provided that
no right
to cure set forth therein shall apply.
Section
3.05
|
Review
of Mortgage Loans.
|
From
the
related Closing Date until the date 30 days after the related Closing
Date, the
Purchaser shall have the right to review the Mortgage Files and obtain
BPOs on
the Mortgaged Properties relating to the Mortgage Loans purchased on
the related
Closing Date, with the results of such BPO reviews to be communicated
to the
Company for a period up to 30 days after the related Closing Date. In
addition,
the Purchaser shall have the right to reject any Mortgage Loan which
in the
Purchaser’s sole determination (i) fails to conform to Underwriting Guidelines,
(ii) is underwritten without verification of the Mortgagor’s income and assets
and there is no credit report or FICO Score, (iii) the Purchaser deems
the
Mortgage Loan to not be an acceptable credit risk, or (iv) the value
of the
Mortgaged Property pursuant to any BPO varies by more than plus or minus
15%
from the lesser of (A) the original appraised value of the Mortgaged
Property or
(B) the purchase price of the Mortgaged Property as of the date of origination.
In the event that the Purchaser so rejects any Mortgage Loan, the Company
shall
repurchase the rejected Mortgage Loan at the Repurchase Price in the
manner
prescribed in Section 3.03 upon receipt of notice from the Purchaser
of the
rejection of such Mortgage Loan. Any rejected Mortgage Loan shall be
removed
from the terms of this Agreement. The Company shall make available all
files
required by the Purchaser in order to complete its review, including
all
CRA/HMDA required data fields. To the extent that during the course of
the
Purchaser’s initial review, the Purchaser discovers that the Mortgage Loans do
not otherwise meet the Company’s Underwriting Guidelines or the terms of the
related Trade Confirmation, the Purchaser shall have the right to carry
out
additional due diligence reviews, which additional due diligence shall
be at the
expense of the Company. The Purchaser’s decision to increase its due diligence
review or obtain additional BPO’s or other property evaluations is at its sole
discretion. The additional review may be for any reason including but
not
limited to credit quality, property valuations, and data integrity. Any
review
performed by the Purchaser prior to the Closing Date does not limit the
Purchaser’s rights or the Company’s obligations under this section.
36
Upon
three (3) Business Days prior notice to the Company, the Purchaser shall
have
the opportunity to conduct a corporate due diligence of the Company,
including
but not limited to, on site review of the Company’s facilities and discussions
with the Company’s management. The Purchaser may conduct such review prior to or
following the initial Closing Date. In addition, the Purchaser may perform
additional reviews as the Purchaser, in its sole discretion, deems
necessary.
ARTICLE
IV
ADMINISTRATION
AND SERVICING OF MORTGAGE LOANS
Section
4.01
|
Company
to Act as Servicer.
|
The
Company, as an independent contractor, shall service and administer the
Mortgage
Loans and shall have full power and authority, acting alone, to do any
and all
things in connection with such servicing and administration which the
Company
may deem necessary or desirable, consistent with the terms of this Agreement
and
with Accepted Servicing Practices.
Consistent
with the terms of this Agreement, the Company 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
Company’s reasonable and prudent determination such waiver, modification,
postponement or indulgence is not materially adverse to the Purchaser,
provided,
however,
that
the
Company shall not make any future advances with respect to a Mortgage
Loan and
(unless the Mortgagor is in default with respect to the Mortgage Loan
or such
default is, in the judgment of the Company, imminent and the Company
has
obtained the prior written consent of the Purchaser) the Company shall
not
permit any modification of any material term of any Mortgage Loan including
any
modifications that would change the Mortgage Interest Rate, defer or
forgive the
payment of principal or interest, reduce or increase the outstanding
principal
balance (except for actual payments of principal) or change the final
maturity
date on such Mortgage Loan. In the event of any such modification which
permits
the deferral of interest or principal payments on any Mortgage Loan,
the Company
shall, on the Business Day immediately preceding the Remittance Date
in any
month in which any such principal or interest payment has been deferred,
deposit
in the Custodial Account from its own funds, in accordance with Section
5.03,
the difference between (a) such month’s principal and one month’s interest at
the Mortgage Loan Remittance Rate on the unpaid principal balance of
such
Mortgage Loan and (b) the amount paid by the Mortgagor. The Company shall
be
entitled to reimbursement for such advances to the same extent as for
all other
advances made pursuant to Section 5.03. Without limiting the generality
of the
foregoing, the Company shall continue, and is hereby authorized and empowered,
to execute and deliver on behalf of itself and the Purchasers, all instruments
of satisfaction or cancellation, or of partial or full release, discharge
and
all other comparable instruments, with respect to the Mortgage Loans
and with
respect to the Mortgaged Properties. If reasonably required by the Company,
the
Purchaser shall furnish the Company with any powers of attorney and other
documents necessary or appropriate to enable the Company to carry out
its
servicing and administrative duties under this Agreement.
In
servicing and administering the Mortgage Loans, the Company shall employ
procedures (including collection procedures) and exercise the same care
that it
customarily employs and exercises in servicing and administering mortgage
loans
(similar in quality to the Mortgage Loans) for its own account, giving
due
consideration to Accepted Servicing Practices where such practices do
not
conflict with the requirements of this Agreement, and the Purchaser’s reliance
on the Company.
37
Notwithstanding
anything in this Agreement to the contrary, in the event of a Principal
Prepayment in full or in part of a Mortgage Loan, the Company may not
waive any
Prepayment Charge or portion thereof required by the terms of the related
Mortgage Note, unless required to do so pursuant to any law or regulation
in
effect at the time of the prepayment. The Company shall collect any Prepayment
Charge required to be paid by the Mortgagor under the terms of any Mortgage
Note
for the account of the Purchaser. The Company shall remit the amount
of such
Prepayment Charge to the Purchaser on the Remittance Date immediately
following
the date of collection of such Prepayment Charge. If the Company waives
or does
not collect all or a portion of a Prepayment Charge relating to a Principal
Prepayment in full or in part due to any action or omission of the Company,
the
Company shall deposit the amount of such Prepayment Charge (or such portion
thereof as had been waived for deposit) into the Custodial Account for
distribution in accordance with the terms of this Agreement.
The
Mortgage Loans may be subserviced by the Subservicer on behalf of the
Company
provided that the Subservicer is a Xxxxxx Xxx-approved servicer or a
Xxxxxxx Mac
seller/servicer in good standing, and no event has occurred, including
but not
limited to a change in insurance coverage, which would make it unable
to comply
with the eligibility requirements for lenders imposed by Xxxxxx Xxx or
for
seller/servicers imposed by Xxxxxxx Mac, or which would require notification
to
Xxxxxx Xxx or Xxxxxxx Mac. The Company may perform any of its servicing
responsibilities hereunder or may cause the Subservicer to perform any
such
servicing responsibilities on its behalf, but the use by the Company
of the
Subservicer shall not release the Company from any of its obligations
hereunder
and the Company shall remain responsible hereunder for all acts and omissions
of
the Subservicer as fully as if such acts and omissions were those of
the
Company. The Company shall pay all fees and expenses of the Subservicer
from its
own funds, and the Subservicer’s fee shall not exceed the Servicing
Fee.
At
the
cost and expense of the Company, without any right of reimbursement from
the
Custodial Account, the Company shall be entitled to terminate the rights
and
responsibilities of the Subservicer and arrange for any servicing
responsibilities to be performed by a successor Subservicer meeting the
requirements in the preceding paragraph, provided,
however,
that
nothing
contained herein shall be deemed to prevent or prohibit the Company,
at the
Company’s option, from electing to service the related Mortgage Loans itself.
In
the event that the Company’s responsibilities and duties under this Agreement
are terminated pursuant to Section 9.04, 10.01 or 11.02, and if requested
to do
so by the Purchaser, the Company shall at its own cost and expense terminate
the
rights and responsibilities of the Subservicer as soon as is reasonably
possible. The Company shall pay all fees, expenses or penalties necessary
in
order to terminate the rights and responsibilities of the Subservicer
from the
Company’s own funds without reimbursement from the Purchaser.
Notwithstanding
any of the provisions of this Agreement relating to agreements or arrangements
between the Company and the Subservicer or any reference herein to actions
taken
through the Subservicer or otherwise, the Company shall not be relieved
of its
obligations to the Purchaser and shall be obligated to the same extent
and under
the same terms and conditions as if it alone were servicing and administering
the Mortgage Loans. The Company shall be entitled to enter into an agreement
with the Subservicer for indemnification of the Company by the Subservicer
and
nothing contained in this Agreement shall be deemed to limit or modify
such
indemnification.
38
Any
Subservicing Agreement and any other transactions or services relating
to the
Mortgage Loans involving the Subservicer shall be deemed to be between
the
Subservicer and Company alone, and the Purchaser shall have no obligations,
duties or liabilities with respect to the Subservicer including no obligation,
duty or liability of Purchaser to pay the Subservicer’s fees and expenses. For
purposes of distributions and advances by the Company pursuant to this
Agreement, the Company shall be deemed to have received a payment on
a Mortgage
Loan when the Subservicer has received such payment.
Section
4.02
|
Liquidation
of Mortgage Loans.
|
In
the
event that any payment due under any Mortgage Loan and not postponed
pursuant to
Section 4.01 is not paid when the same becomes due and payable, or in
the event
the Mortgagor fails to perform any other covenant or obligation under
the
Mortgage Loan and such failure continues beyond any applicable grace
period, the
Company shall take such action as (1) the Company would take under similar
circumstances with respect to a similar mortgage loan held for its own
account
for investment, (2) shall be consistent with Accepted Servicing Practices,
(3)
the Company shall determine prudently to be in the best interest of Purchaser,
and (4) is consistent with any related PMI Policy. In the event that
any payment
due under any Mortgage Loan is not postponed pursuant to Section 4.01
and
remains delinquent for a period of 90 days or any other default continues
for a
period of 90 days beyond the expiration of any grace or cure period,
the Company
shall commence foreclosure proceedings, provided that,
prior
to commencing foreclosure proceedings, the Company shall notify the Purchaser
in
writing of the Company’s intention to do so, and the Company shall not commence
foreclosure proceedings if the Purchaser objects to such action within
10
Business Days of receiving such notice. In the event the Purchaser objects
to
such foreclosure action, the Company shall not be required to make Monthly
Advances with respect to such Mortgage Loan, pursuant to Section 5.03.
The
Company shall notify the Purchaser in writing of the commencement of
foreclosure
proceedings. In such connection, the Company shall from its own funds
make all
necessary and proper Servicing Advances, provided,
however,
that
the
Company shall not be required to expend its own funds in excess of $2,000
in
connection with any foreclosure or towards the restoration or preservation
of
any Mortgaged Property, unless it shall determine (a) that such preservation,
restoration and/or foreclosure will increase the proceeds of liquidation
of the
Mortgage Loan to the Purchaser after reimbursement to itself for such
expenses
and (b) that such expenses will be recoverable by it either through Liquidation
Proceeds (respecting which it shall have priority for purposes of withdrawals
from the Custodial Account pursuant to Section 4.05) or through Insurance
Proceeds (respecting which it shall have similar priority). The Company
shall
use its best efforts to realize upon defaulted Mortgage Loans in such
a manner
as will maximize the receipt of principal and interest by the Purchaser,
taking
into account, among other things, the timing of foreclosure proceedings.
Notwithstanding
anything to the contrary contained herein, in connection with a foreclosure
or
acceptance of a deed in lieu of foreclosure, in the event the Company
has
reasonable cause to believe that a Mortgaged Property is contaminated
by
hazardous or toxic substances or wastes, or upon the request of the Purchaser,
the Company shall arrange for the preparation of an environmental inspection
report with respect to such Mortgaged Property by a qualified inspector
who
regularly conducts environmental audits using customary industry standards.
Upon
completion of the inspection, the Company shall promptly provide the
Purchaser
with a written report of the environmental inspection.
39
After
reviewing the environmental inspection report, the Purchaser shall determine
how
the Company shall proceed with respect to the Mortgaged Property. In
the event
(a) the environmental inspection report indicates that the Mortgaged
Property is contaminated by hazardous or toxic substances or wastes and
(b) the Purchaser directs the Company to proceed with foreclosure or
acceptance of a deed in lieu of foreclosure, the Company shall be reimbursed
for
all reasonable costs associated with such foreclosure or acceptance of
a deed in
lieu of foreclosure and any related environmental clean up costs, as
applicable,
from the related Liquidation Proceeds, or if the Liquidation Proceeds
are
insufficient to fully reimburse the Company, the Company shall be entitled
to be
reimbursed from amounts in the Custodial Account pursuant to Section
4.05
hereof. In the event the Purchaser directs the Company not to proceed
with
foreclosure or acceptance of a deed in lieu of foreclosure, the Company
shall be
reimbursed for all Servicing Advances made with respect to the related
Mortgaged
Property from the Custodial Account pursuant to Section 4.05
hereof.
Section
4.03
|
Collection
of Mortgage Loan Payments.
|
Continuously
from the date hereof until the principal and interest on all Mortgage
Loans are
paid in full, the Company shall proceed diligently to collect all payments
due
under each of the Mortgage Loans when the same shall become due and payable
and
shall take, to the extent such procedures shall be consistent with this
Agreement and the terms and provisions of any related PMI Policy or LPMI
Policy,
follow such collection procedures as it follows with respect to mortgage
loans
comparable to the Mortgage Loans and held for its account. Further, the
Company
shall take special care in ascertaining and estimating Escrow Payments
and all
other charges that will become due and payable with respect to the Mortgage
Loan
and the Mortgaged Property, to the end that the installments payable
by the
Mortgagors will be sufficient to pay such charges as and when they become
due
and payable.
Section
4.04
|
Establishment
of and Deposits to Custodial Account.
|
The
Company shall segregate and hold all funds collected and received pursuant
to a
Mortgage Loan separate and apart from any of its own funds and general
assets
and shall establish and maintain one or more Custodial Accounts, in the
form of
time deposit or demand accounts, titled “National City Mortgage Co., as
Servicer, in trust for the Purchaser of Conventional Residential Conventional
Residential Fixed Rate and Adjustable Rate Mortgage Loans”. The Custodial
Account shall be established with a Qualified Depository acceptable to
the
Purchaser. Any funds deposited in the Custodial Account shall at all
times be
fully insured to the full extent permitted under applicable law. Funds
deposited
in the Custodial Account may be drawn on by the Company in accordance
with
Section 4.05. The creation of any Custodial Account shall be evidenced
by a
certification in the form of Exhibit
D-1
hereto,
in the case of an account established with the Company, or by a letter
agreement
in the form of Exhibit
D-2
hereto,
in the case of an account held by a depository other than the Company.
A copy of
such certification or letter agreement shall be furnished to the Purchaser
and,
upon request, to any subsequent Purchaser.
40
The
Company shall deposit in the Custodial Account on a daily basis, and
retain
therein, the following collections received by the Company and payments
made by
the Company after the related Cut-off Date, (other than payments of principal
and interest due on or before the related Cut-off Date, or with respect
to each
LPMI Loan, the amount of the LPMI Fee):
(i) all
payments on account of principal on the Mortgage Loans, including all
Principal
Prepayments;
(ii) all
payments on account of interest on the Mortgage Loans adjusted to the
Mortgage
Loan Remittance Rate, including all Prepayment Charges;
(iii) all
Liquidation Proceeds;
(iv) all
Insurance Proceeds including amounts required to be deposited pursuant
to
Section 4.10 (other than proceeds to be held in the Escrow Account and
applied
to the restoration or repair of the Mortgaged Property or released to
the
Mortgagor in accordance with Section 4.14), Section 4.11 and Section
4.15;
(v) all
Condemnation Proceeds which are not applied to the restoration or repair
of the
Mortgaged Property or released to the Mortgagor in accordance with Section
4.14;
(vi) any
amount required to be deposited in the Custodial Account pursuant to
Section
4.01, 4.09, 5.03, 6.01 or 6.02;
(vii) any
amounts payable in connection with the repurchase of any Mortgage Loan
pursuant
to Section 3.03 or 3.04 and all amounts required to be deposited by the
Company
in connection with a shortfall in principal amount of any Qualified Substitute
Mortgage Loan pursuant to Section 3.03;
(viii) with
respect to each Principal Prepayment in full or in part, the Prepayment
Interest
Shortfall Amount, to be paid by the Company out of its own funds without
reimbursement therefor, if any, for the month of distribution;
(ix) any
amounts required to be deposited by the Company pursuant to Section 4.11
in
connection with the deductible clause in any blanket hazard insurance
policy;
and
(x) any
amounts received with respect to or related to any REO Property and all
REO
Disposition Proceeds pursuant to Section 4.16.
The
foregoing requirements for deposit into the Custodial Account shall be
exclusive, it being understood and agreed that, without limiting the
generality
of the foregoing, payments in the nature of Ancillary Income, including
late
payment charges and assumption fees, to the extent permitted by Section
6.01,
need not be deposited by the Company into the Custodial Account. Any
interest
paid on funds deposited in the Custodial Account by the depository institution
shall accrue to the benefit of the Company and the Company shall be entitled
to
retain and withdraw such interest from the Custodial Account pursuant
to Section
4.05. Prior to changing the location of the Custodial Account, the Company
shall
give notice to the Purchaser of such change, which notice shall set forth
the
new location of the Custodial Account when established.
41
Section
4.05
|
Permitted
Withdrawals From Custodial Account.
|
The
Company shall, from time to time, withdraw funds from the Custodial Account
for
the following purposes:
(i) to
make
payments to the Purchaser in the amounts and in the manner provided for
in
Section 5.01;
(ii) to
reimburse itself for Monthly Advances of the Company’s funds made pursuant to
Section 5.03, the Company’s right to reimburse itself pursuant to this subclause
(ii) being limited to amounts received on the related Mortgage Loan which
represent late payments of principal and/or interest respecting which
any such
advance was made, it being understood that, in the case of any such
reimbursement, the Company’s right thereto shall be prior to the rights of
Purchaser, except that, where the Company is required to repurchase a
Mortgage
Loan pursuant to Section 3.03, 3.04 or 6.02, the Company’s right to such
reimbursement shall be subsequent to the payment to the Purchaser of
the
Repurchase Price pursuant to such sections and all other amounts required
to be
paid to the Purchaser with respect to such Mortgage Loan;
(iii) to
reimburse itself for unreimbursed Servicing Advances, and for any unpaid
Servicing Fees, the Company’s right to reimburse itself pursuant to this
subclause (iii) with respect to any Mortgage Loan being limited to related
Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds and such
other
amounts as may be collected by the Company from the Mortgagor or otherwise
relating to the Mortgage Loan, it being understood that, in the case
of any such
reimbursement, the Company’s right thereto shall be prior to the rights of
Purchaser except where the Company is required to repurchase a Mortgage
Loan
pursuant to Section 3.03, 3.04 or 6.02, in which case the Company’s right to
such reimbursement shall be subsequent to the payment to the Purchaser
of the
Repurchase Price pursuant to such sections and all other amounts required
to be
paid to the Purchaser with respect to such Mortgage Loan;
(iv) to
pay
itself interest on funds deposited in the Custodial Account;
(v) to
reimburse itself for expenses incurred and reimbursable to it pursuant
to
Section 9.01;
(vi) to
pay
any amount required to be paid pursuant to Section 4.16 related to any
REO
Property, it being understood that in the case of any such expenditure
or
withdrawal related to a particular REO Property, the amount of such expenditure
or withdrawal from the Custodial Account shall be limited to amounts
on deposit
in the Custodial Account with respect to the related REO Property;
(vii) to
clear
and terminate the Custodial Account upon the termination of this Agreement;
and
42
(viii) to
withdraw funds deposited in error.
In
the
event that the Custodial Account is interest bearing, on each Remittance
Date,
the Company shall withdraw all funds from the Custodial Account except
for those
amounts which, pursuant to Section 5.01, the Company is not obligated
to remit
on such Remittance Date. The Company may use such withdrawn funds only
for the
purposes described in this Section 4.05.
The
Company shall keep and maintain separate accounting, on a Mortgage Loan
by
Mortgage Loan basis, for the purpose of justifying any withdrawal from
the
Custodial Account pursuant to paragraphs (ii) through (viii) above.
Section
4.06
|
Establishment
of and Deposits to Escrow Account.
|
The
Company shall segregate and hold all funds collected and received pursuant
to a
Mortgage Loan constituting Escrow Payments separate and apart from any
of its
own funds and general assets and shall establish and maintain one or
more Escrow
Accounts, in the form of time deposit or demand accounts, titled, “National City
Mortgage Co., as Servicer, in trust for the Purchaser of Conventional
Residential Fixed Rate and Adjustable Rate Mortgage Loans and various
Mortgagors”. The Escrow Accounts shall be established with a Qualified
Depository, in a manner which shall provide maximum available insurance
thereunder. Funds deposited in the Escrow Account may be drawn on by
the Company
in accordance with Section 4.07. The creation of any Escrow Account shall
be
evidenced by a certification in the form of Exhibit
E-1
hereto,
in the case of an account established with the Company, or by a letter
agreement
in the form of Exhibit
E-2
hereto,
in the case of an account held by a depository other than the Company.
A copy of
such certification shall be furnished to the Purchaser and, upon request,
to any
subsequent Purchaser.
The
Company shall deposit in the Escrow Account or Accounts on a daily basis,
and
retain therein:
(i) all
Escrow Payments collected on account of the Mortgage Loans, for the purpose
of
effecting timely payment of any such items as required under the terms
of this
Agreement; and
(ii) all
amounts representing Insurance Proceeds or Condemnation Proceeds which
are to be
applied to the restoration or repair of any Mortgaged Property.
The
Company shall make withdrawals from the Escrow Account only to effect
such
payments as are required under this Agreement, as set forth in Section
4.07. The
Company shall be entitled to retain any interest paid on funds deposited
in the
Escrow Account by the depository institution, other than interest on
escrowed
funds required by law to be paid to the Mortgagor. To the extent required
by
law, the Company shall pay interest on escrowed funds to the Mortgagor
notwithstanding that the Escrow Account may be non-interest bearing or
that
interest paid thereon is insufficient for such purposes.
43
Section
4.07
|
Permitted
Withdrawals From Escrow Account.
|
Withdrawals
from the Escrow Account or Accounts may be made by the Company
only:
(i) to
effect
timely payments of ground rents, taxes, assessments, water rates, mortgage
insurance premiums, condominium charges, fire and hazard insurance premiums
or
other items constituting Escrow Payments for the related Mortgage;
(ii) to
reimburse the Company for any Servicing Advances made by the Company
pursuant to
Section 4.08 with respect to a related Mortgage Loan, but only from amounts
received on the related Mortgage Loan which represent late collections
of Escrow
Payments thereunder;
(iii) to
refund
to any Mortgagor any funds found to be in excess of the amounts required
under
the terms of the related Mortgage Loan;
(iv) for
transfer to the Custodial Account and application to reduce the principal
balance of the Mortgage Loan in accordance with the terms of the related
Mortgage and Mortgage Note;
(v) for
application to restoration or repair of the Mortgaged Property in accordance
with the procedures outlined in Section 4.14;
(vi) to
pay to
the Company, or any Mortgagor to the extent required by law, any interest
paid
on the funds deposited in the Escrow Account;
(vii) to
clear
and terminate the Escrow Account on the termination of this Agreement;
and
(viii) to
withdraw funds deposited in error.
Section
4.08
|
Payment
of Taxes, Insurance and Other Charges.
|
With
respect to each Mortgage Loan, the Company shall maintain accurate records
reflecting the status of ground rents, taxes, assessments, water rates,
sewer
rents, and other charges which are or may become a lien upon the Mortgaged
Property and the status of PMI 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, employing for such purpose
deposits
of the Mortgagor in the Escrow Account which shall have been estimated
and
accumulated by the Company in amounts sufficient for such purposes, as
allowed
under the terms of the Mortgage. To the extent that a Mortgage does not
provide
for Escrow Payments, the Company shall determine that any such payments
are made
by the Mortgagor at the time they first become due. The Company assumes
full
responsibility for the timely payment of all such bills and shall effect
timely
payment of all such charges irrespective of each Mortgagor’s faithful
performance in the payment of same or the making of the Escrow Payments,
and the
Company shall make advances from its own funds to effect such
payments.
44
Section
4.09
|
Protection
of Accounts.
|
The
Company may transfer the Custodial Account or the Escrow Account to a
different
Qualified Depository from time to time. Such transfer shall be made only
upon
obtaining the consent of the Purchaser, which consent shall not be withheld
unreasonably.
The
Company shall bear any expenses, losses or damages sustained by the Purchaser
because the Custodial Account and/or the Escrow Account are not demand
deposit
accounts.
Amounts
on deposit in the Custodial Account and the Escrow Account may at the
option of
the Company be invested in Eligible Investments; provided that
in the
event that amounts on deposit in the Custodial Account or the Escrow
Account
exceed the amount fully insured by the FDIC (the “Insured
Amount”)
the
Company shall be obligated to invest the excess amount over the Insured
Amount
in Eligible Investments on the same Business Day as such excess amount
becomes
present in the Custodial Account or the Escrow Account. Any such Eligible
Investment shall mature no later than the Determination Date next following
the
date of such Eligible Investment, provided,
however,
that
if such
Eligible Investment is an obligation of a Qualified Depository (other
than the
Company) that maintains the Custodial Account or the Escrow Account,
then such
Eligible Investment may mature on such Remittance Date. Any such Eligible
Investment shall be made in the name of the Company in trust for the
benefit of
the Purchaser. All income on or gain realized from any such Eligible
Investment
shall be for the benefit of the Company and may be withdrawn at any time
by the
Company. Any losses incurred in respect of any such investment shall
be
deposited in the Custodial Account or the Escrow Account, by the Company
out of
its own funds immediately as realized.
Section
4.10
|
Maintenance
of Hazard Insurance.
|
The
Company shall cause to be maintained for each Mortgage Loan hazard insurance
such that all buildings upon the Mortgaged Property are insured by a
generally
acceptable insurer rated A:VI or better in the current Best’s Key Rating Guide
(“Best’s”)
against loss by fire, hazards of extended coverage and such other hazards
as are
customary in the area where the Mortgaged Property is located, in an
amount
which is at least equal to the lesser of (i) the replacement value of
the
improvements securing such Mortgage Loan and (ii) the greater of (a)
the
outstanding principal balance of the Mortgage Loan and (b) an amount
such that
the proceeds thereof shall be sufficient to prevent the Mortgagor or
the loss
payee from becoming a co-insurer.
If
the
related Mortgaged Property is located in an area identified in the Federal
Register by the Flood Emergency Management Agency as having special flood
hazards (and such flood insurance has been made available) a flood insurance
policy meeting the requirements of the current guidelines of the Federal
Insurance Administration is in effect with a generally acceptable insurance
carrier rated A:VI or better in Best’s in an amount representing coverage not
less than the lesser of (i) the minimum amount required, under the terms
of
coverage, to compensate for any damage or loss on a replacement cost
basis (or
the unpaid balance of the mortgage if replacement cost coverage is not
available
for the type of building insured) and (ii) the maximum amount of insurance
which
is available under the National Flood Insurance Act of 1968 or the Flood
Disaster Protection Act of 1973, as amended. If at any time during the
term of
the Mortgage Loan, the Company determines in accordance with applicable
law and
pursuant to the Xxxxxx Xxx Guides that a Mortgaged Property is located
in a
special flood hazard area and is not covered by flood insurance or is
covered in
an amount less than the amount required by the Flood Disaster Protection
Act of
1973, as amended, the Company shall notify the related Mortgagor that
the
Mortgagor must obtain such flood insurance coverage, and if said Mortgagor
fails
to obtain the required flood insurance coverage within forty-five (45)
days
after such notification, the Company shall immediately force place the
required
flood insurance on the Mortgagor’s behalf.
45
If
a
Mortgage is secured by a unit in a condominium project, the Company shall
verify
that the coverage required of the owner’s association, including hazard, flood,
liability, and fidelity coverage, is being maintained in accordance with
then
current Xxxxxx Mae requirements, and secure from the owner’s association its
agreement to notify the Company promptly of any change in the insurance
coverage
or of any condemnation or casualty loss that may have a material effect
on the
value of the Mortgaged Property as security.
The
Company shall cause to be maintained on each Mortgaged Property earthquake
or
such other or additional insurance as may be required pursuant to such
applicable laws and regulations as shall at any time be in force and
as shall
require such additional insurance, or pursuant to the requirements of
any
private mortgage guaranty insurer, or as may be required to conform with
Accepted Servicing Practices.
In
the
event that any Purchaser or the Company shall determine that the Mortgaged
Property should be insured against loss or damage by hazards and risks
not
covered by the insurance required to be maintained by the Mortgagor pursuant
to
the terms of the Mortgage, the Company shall communicate and consult
with the
Mortgagor with respect to the need for such insurance and bring to the
Mortgagor’s attention the desirability of protection of the Mortgaged
Property.
All
policies required hereunder shall name the Company as loss payee and
shall be
endorsed with standard or union mortgagee clauses, without contribution,
which
shall provide for at least 30 days prior written notice of any cancellation,
reduction in amount or material change in coverage.
The
Company shall not interfere with the Mortgagor’s freedom of choice in selecting
either his insurance carrier or agent, provided,
however,
that
the
Company shall not accept any such insurance policies from insurance companies
unless such companies are rated A:VI or better in Best’s and are licensed to do
business in the jurisdiction in which the Mortgaged Property is located.
The
Company shall determine that such policies provide sufficient risk coverage
and
amounts, that they insure the property owner, and that they properly
describe
the property address. The Company shall furnish to the Mortgagor a formal
notice
of expiration of any such insurance in sufficient time for the Mortgagor
to
arrange for renewal coverage by the expiration date.
Pursuant
to Section 4.04, any amounts collected by the Company under any such
policies
(other than amounts to be deposited in the Escrow Account and applied
to the
restoration or repair of the related Mortgaged Property, or property
acquired in
liquidation of the Mortgage Loan, or to be released to the Mortgagor,
in
accordance with the Company’s normal servicing procedures as specified in
Section 4.14) shall be deposited in the Custodial Account subject to
withdrawal
pursuant to Section 4.05.
46
Section
4.11
|
Maintenance
of Mortgage Impairment Insurance.
|
In
the
event that the Company shall obtain and maintain a blanket policy insuring
against losses arising from fire and hazards covered under extended coverage
on
all of the Mortgage Loans, then, to the extent such policy provides coverage
in
an amount equal to the amount required pursuant to Section 4.10 and otherwise
complies with all other requirements of Section 4.10, it shall conclusively
be
deemed to have satisfied its obligations as set forth in Section 4.10.
Any such
policy shall be issued by an issuer that has a Best rating of A:VI or
better.
Any amounts collected by the Company under any such policy relating to
a
Mortgage Loan shall be deposited in the Custodial Account subject to
withdrawal
pursuant to Section 4.05. Such policy may contain a deductible clause,
in which
case, in the event that there shall not have been maintained on the related
Mortgaged Property a policy complying with Section 4.10, and there shall
have
been a loss which would have been covered by such policy, the Company
shall
deposit in the Custodial Account at the time of such loss the amount
not
otherwise payable under the blanket policy because of such deductible
clause,
such amount to deposited from the Company’s funds, without reimbursement
therefor. Upon request of any Purchaser, the Company shall cause to be
delivered
to such Purchaser a certified true copy of such policy and a statement
from the
insurer thereunder that such policy shall in no event be terminated or
materially modified without 30 days’ prior written notice to such
Purchaser.
Section
4.12
|
Maintenance
of Fidelity Bond and Errors and Omissions Insurance.
|
The
Company shall maintain with responsible companies, at its own expense,
a blanket
Fidelity Bond and an Errors and Omissions Insurance Policy that meets
the
requirements of Xxxxxx Xxx or Xxxxxxx Mac, with broad coverage on all
officers,
employees or other persons acting in any capacity requiring such persons
to
handle funds, money, documents or papers relating to the Mortgage Loans
(“Company
Employees”).
Any
such Fidelity Bond and Errors and Omissions Insurance Policy shall be
in the
form of the Mortgage Banker’s Blanket Bond and shall protect and insure the
Company against losses, including forgery, theft, embezzle-ment, fraud,
errors
and omissions and negligent acts of such Company Employees. Such Fidelity
Bond
and Errors and Omissions Insurance Policy also shall protect and insure
the
Company against losses in connection with the release or satisfaction
of a
Mortgage Loan without having obtained payment in full of the indebtedness
secured thereby. No provision of this Section 4.12 requiring such Fidelity
Bond
and Errors and Omissions Insurance Policy shall diminish or relieve the
Company
from its duties and obligations as set forth in this Agreement. The minimum
coverage under any such bond and insurance policy shall be acceptable
to Xxxxxx
Mae or Xxxxxxx Mac. Upon the request of any Purchaser, the Company shall
cause
to be delivered to such Purchaser a certified true copy of such fidelity
bond
and insurance policy and a statement from the surety and the insurer
that such
fidelity bond and insurance policy shall in no event be terminated or
materially
modified without 30 days’ prior written notice to the Purchaser.
Section
4.13
|
Inspections.
|
The
Company shall inspect the Mortgaged Property as often as deemed necessary
by the
Company to assure itself that the value of the Mortgaged Property is
being
preserved. In addition, if any Mortgage Loan is more than 60 days delinquent,
the Company immediately shall inspect the Mortgaged Property and shall
conduct
subsequent inspections in accordance with Accepted Servicing Practices
or as may
be required by the primary mortgage guaranty insurer. The Company shall
keep a
written report of each such inspection.
47
Section
4.14
|
Restoration
of Mortgaged Property.
|
The
Company need not obtain the approval of the Purchaser prior to releasing
any
Insurance Proceeds or Condemnation Proceeds to the Mortgagor to be applied
to
the restoration or repair of the Mortgaged Property if such release is
in
accordance with Accepted Servicing Practices. At a minimum, the Company
shall
comply with the following conditions in connection with any such release
of
Insurance Proceeds or Condemnation Proceeds:
(i) the
Company shall receive satisfactory independent verification of completion
of
repairs and issuance of any required approvals with respect thereto;
(ii) the
Company shall take all steps necessary to preserve the priority of the
lien of
the Mortgage, including, but not limited to requiring waivers with respect
to
mechanics’ and materialmen’s liens;
(iii) the
Company shall verify that the Mortgage Loan is not in default; and
(iv) pending
repairs or restoration, the Company shall place the Insurance Proceeds
or
Condemnation Proceeds in the Escrow Account.
If
the
Purchaser is named as an additional loss payee, the Company is hereby
empowered
to endorse any loss draft issued in respect of such a claim in the name
of the
Purchaser.
Section
4.15
|
Maintenance
of PMI and LPMI Policy; Claims.
|
(a)
With
respect to each Mortgage Loan with a LTV in excess of 80% (or such other
percentage as stated in the related Trade Confirmation), the Company
shall:
(i)
with
respect to Mortgage Loans which are not LPMI Loans, in accordance with
state and
federal laws and without any cost to the Purchaser, maintain or cause
the
Mortgagor to maintain in full force and effect a PMI Policy insuring
that
portion of the Mortgage Loan in excess of 75% of value, and shall pay
or shall
cause the Mortgagor to pay the premium thereon on a timely basis, until
the LTV
of such Mortgage Loan is reduced to (A) 80% (or such other amount as
stated in
the related Trade Confirmation) or (B) that amount for which Xxxxxx Mae
no
longer requires such insurance to be maintained. In the event that such
PMI
Policy shall be terminated, the Company shall obtain from another Qualified
Insurer a comparable replacement policy, with a total coverage equal
to the
remaining coverage of such terminated PMI Policy, at substantially the
same fee
level. If the insurer shall cease to be a Qualified Insurer, the Company
shall
determine whether recoveries under the PMI Policy are jeopardized for
reasons
related to the financial condition of such insurer, it being understood
that the
Company shall in no event have any responsibility or liability for any
failure
to recover under the PMI Policy for such reason. If the Company determines
that
recoveries are so jeopardized, it shall notify the Purchaser and the
Mortgagor,
if required, and obtain from another Qualified Insurer a replacement
insurance
policy. The Company will not cancel or refuse to renew any PMI Policy
in effect
on the related Closing Date that is required to be kept in force under
this
Agreement unless a replacement PMI Policy or LPMI Policy for such cancelled
or
non-renewed policy is obtained from and maintained with a Qualified Insurer.
The
Company shall not take any action which would result in noncoverage under
any
applicable PMI Policy of any loss which, but for the actions of the Company
would have been covered thereunder. In connection with any assumption
or
substitution agreement entered into or to be entered into pursuant to
Section
6.01, the Company shall promptly notify the insurer under the related
PMI
Policy, if any, of such assumption or substitution of liability in accordance
with the terms of such PMI Policy and shall take all actions which may
be
required by such insurer as a condition to the continuation of coverage
under
such PMI Policy. If such PMI Policy is terminated as a result of such
assumption
or substitution of liability, the Company shall obtain a replacement
PMI Policy
as provided above.
48
(ii)
with
respect to LPMI Loans, maintain in full force and effect an LPMI Policy
insuring
that portion of the Mortgage Loan in excess of 75% of value, and from
time to
time, withdraw the LPMI Fee with respect to such LPMI Loan from the Custodial
Account in order to pay the premium thereon on a timely basis, until
the LTV of
such Mortgage Loan is reduced to (a) 80% (or such other amount as stated
in the
related Trade Confirmation) or (b) that amount for which Xxxxxx Xxx no
longer
requires such insurance to be maintained. In the event that the interest
payments made with respect to any LPMI Loan are less than the LPMI Fee,
the
Company shall advance from its own funds the amount of any such shortfall
in the
LPMI Fee, in payment of the premium on the related LPMI Policy. Any such
advance
shall be a Servicing Advance subject to reimbursement pursuant to the
provisions
on Section 4.05. In the event that such LPMI Policy shall be terminated,
the
Company shall obtain from another Qualified Insurer a comparable replacement
policy, with a total coverage equal to the remaining coverage of such
terminated
LPMI Policy, at substantially the same fee level. If the insurer shall
cease to
be a Qualified Insurer, the Company shall determine whether recoveries
under the
LPMI Policy are jeopardized for reasons related to the financial condition
of
such insurer, it being understood that the Company shall in no event
have any
responsibility or liability for any failure to recover under the LPMI
Policy for
such reason. If the Company determines that recoveries are so jeopardized,
it
shall notify the Purchaser and the Mortgagor, if required, and obtain
from
another Qualified Insurer a replacement insurance policy. The Company
will not
cancel or refuse to renew any LPMI Policy in effect on the related Closing
Date
that is required to be kept in force under this Agreement unless a replacement
PMI Policy or LPMI Policy for such cancelled or non-renewed policy is
obtained
from and maintained with a Qualified Insurer. The Company shall not take
any
action which would result in noncoverage under any applicable LPMI Policy
of any
loss which, but for the actions of the Company would have been covered
thereunder. In connection with any assumption or substitution agreement
entered
into or to be entered into pursuant to Section 6.01, the Company shall
promptly
notify the insurer under the related LPMI Policy, if any, of such assumption
or
substitution of liability in accordance with the terms of such LPMI Policy
and
shall take all actions which may be required by such insurer as a condition
to
the continuation of coverage under such PMI Policy. If such LPMI Policy
is
terminated as a result of such assumption or substitution of liability,
the
Company shall obtain a replacement LPMI Policy as provided above.
(b) In
connection with its activities as servicer, the Company agrees to prepare
and
present, on behalf of itself and the Purchaser, claims to the insurer
under any
PMI Policy or LPMI Policy in a timely fashion in accordance with the
terms of
such PMI Policy or LPMI Policy and, in this regard, to take such action
as shall
be necessary to permit recovery under any PMI Policy or LPMI Policy respecting
a
defaulted Mortgage Loan. Pursuant to Section 4.04, any amounts collected
by the
Company under any PMI Policy or LPMI Policy shall be deposited in the
Custodial
Account, subject to withdrawal pursuant to Section 4.05.
49
(c) Purchaser,
in its sole discretion, at any time, may (i) either obtain an additional
PMI
Policy on any Mortgage Loan which already has a PMI Policy in place,
or (ii)
obtain a PMI Policy for any Mortgage Loan which does not already have
a PMI
Policy in place. In any event, the Company agrees to administer such
PMI
Policies in accordance with the Agreement or any Reconstitution
Agreement.
Section
4.16
|
Title,
Management and Disposition of REO Property.
|
In
the
event that title to any Mortgaged Property is acquired in foreclosure
or by deed
in lieu of foreclosure, the deed or certificate of sale shall be taken
in the
name of the Purchaser’s designee, or in the event the Purchaser’s designee 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 Company from any
attorney
duly licensed to practice law in the state where the REO Property is
located.
The Person or Persons holding such title other than the Purchaser’s designee
shall acknowledge in writing that such title is being held as nominee
for the
Purchaser’s designee.
The
Company shall manage, conserve, protect and operate each REO Property
for the
Purchaser solely for the purpose of its prompt disposition and sale.
The
Company, either itself or through an agent selected by the Company, shall
manage, conserve, protect and operate the REO Property in the same manner
that
it manages, conserves, protects and operates other foreclosed property
for its
own account, and in the same manner that similar property in the same
locality
as the REO Property is managed. The Company shall attempt to sell the
same (and
may temporarily rent the same for a period not greater than one year,
except as
otherwise provided below) on such terms and conditions as the Company
deems to
be in the best interest of the Purchaser.
The
Company 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 Company shall make or cause to be made
a
written report of each such Inspection. Such reports shall be retained
in the
Mortgage File and copies thereof shall be forwarded by the Company to
the
Purchaser. The Company shall use its best efforts to dispose of the REO
Property
as soon as possible and shall sell such REO Property in any event within
one
year after title has been taken to such REO Property, unless the Company
determines, and gives an appropriate notice to the Purchaser to such
effect,
that a longer period is necessary for the orderly liquidation of such
REO
Property. If a period longer than one year is permitted under the foregoing
sentence and is necessary to sell any REO Property, the Company shall
report
monthly to the Purchaser as to the progress being made in selling such
REO
Property.
With
respect to each REO Property, the Company shall segregate and hold all
funds
collected and received in connection with the operation of the REO Property
separate and apart from its own funds or general assets and shall establish
and
maintain a separate REO Account for each REO Property in the form of
a non
interest bearing demand account. Each REO Account shall be established
with the
Company, any subsidiary, affiliate or parent of the Company each of which
must
be a Qualified Depository, or, with the prior consent of the Purchaser,
with a
commercial bank, a mutual savings bank or a savings association. The
creation of
any REO Account shall be evidenced by a letter agreement substantially
in the
form of the Custodial Account Letter Agreement attached as Exhibit
D-2
hereto.
An original of such letter agreement shall be furnished to any Purchaser
upon
request.
50
The
Company shall deposit or cause to be deposited, on a daily basis in each
REO
Account all revenues received with respect to the related REO Property
and shall
withdraw therefrom funds necessary for the proper operation, management
and
maintenance of the REO Property, including the cost of maintaining any
hazard
insurance pursuant to Section 4.10 and Section 4.16 hereof and the fees
of any
managing agent acting on behalf of the Company. The Company shall not
be
entitled to retain interest paid or other earnings, if any, on funds
deposited
in such REO Account. On or before each Determination Date, the Company
shall
withdraw from each REO Account and deposit into the Custodial Account
the net
income from the REO Property on deposit in the REO Account.
The
Company shall furnish to the Purchaser on each Remittance Date, an operating
statement for each REO Property covering the operation of each REO Property
for
the previous month. Such operating statement shall be accompanied by
such other
information as the Purchaser shall reasonably request.
The
Company shall also maintain on each REO Property fire and hazard insurance
with
extended coverage in amount which is at least equal to the maximum insurable
value of the improvements which are a part of such property, liability
insurance
and, to the extent required and available under the National Flood Insurance
Act
of 1968 or the Flood Disaster Protection Act of 1973, as amended, flood
insurance in the amount required above.
The
disposition of REO Property shall be carried out by the Company at such
price,
and upon such terms and conditions, as the Company deems to be in the
best
interests of the Purchaser. If as of the date title to any REO Property
was
acquired by the Company there were outstanding unreimbursed Servicing
Advances
with respect to the REO Property, the Company, upon an REO Disposition
of such
REO Property, shall be entitled to reimbursement for any related unreimbursed
Servicing Advances from proceeds received in connection with such REO
Disposition. The proceeds from the REO Disposition, net of any payment
to the
Company as provided above, shall be deposited in the REO Account and
shall be
transferred to the Custodial Account on the Determination Date in the
month
following receipt thereof for distribution on the succeeding Remittance
Date in
accordance with Section 4.05.
The
Company shall withdraw the Custodial Account funds necessary for the
proper
operation, management and maintenance of the REO Property, including
the cost of
maintaining any hazard insurance pursuant to Section 4.10 hereof and
the fees of
any managing agent of the Company, a Subservicer, or the Company itself.
The REO
management fee shall be an amount that is reasonable and customary in
the area
where the Mortgaged Property is located. The Company shall make monthly
distributions on each Remittance Date to the Purchaser of the net cash
flow from
the REO Property (which shall equal the revenues from such REO Property
net of
the expenses described in the Section 4.16 and of any reserves reasonably
required from time to time to be maintained to satisfy anticipated liabilities
for such expenses).
51
Notwithstanding
the foregoing, at any time and from time to time, the Purchaser may at
its
election terminate this Agreement with respect to one or more REO Properties
as
provided by Section 11.02.
Section
4.17
|
Real
Estate Owned Reports.
|
Together
with the statement furnished pursuant to Section 5.02, the Company shall
furnish
to the Purchaser on or before the Remittance Date each month a statement
with
respect to any REO Property covering the operation of such REO Property
for the
previous month and the Company’s efforts in connection with the sale of such REO
Property and any rental of such REO Property incidental to the sale thereof
for
the previous month. That statement shall be accompanied by such other
information as the Purchaser shall reasonably request.
Section
4.18
|
Liquidation
Reports.
|
Upon
the
foreclosure sale of any Mortgaged Property or the acquisition thereof
by the
Company pursuant to a deed in lieu of foreclosure, the Company shall
submit to
the Purchaser a liquidation report with respect to such Mortgaged
Property.
Section
4.19
|
Reports
of Foreclosures and Abandonments of Mortgaged Property.
|
Following
the foreclosure sale or abandonment of any Mortgaged Property, the Company
shall
report such foreclosure or abandonment as required pursuant to Section
6050J of
the Code.
Section
4.20
|
Notification
of Adjustments
|
On
each
Adjustment Date, the Company shall make interest rate adjustments for
each
Adjustable Rate Mortgage Loan in compliance with the requirements of
the related
Mortgage and Mortgage Note. The Company shall execute and deliver the
notices
required by each Mortgage and Mortgage Note regarding interest rate adjustments.
The Company also shall provide timely notification to the Purchaser of
all
applicable data and information regarding such interest rate adjustments
and the
Company’s methods of implementing such interest rate adjustments. Upon the
discovery by the Company or the Purchaser that the Company has failed
to adjust
a Mortgage Interest Rate or a Monthly Payment pursuant to the terms of
the
related Mortgage Note and Mortgage, the Company shall immediately deposit
in the
Custodial Account from its own funds the amount of any interest loss
caused
thereby without reimbursement therefor.
ARTICLE
V
PAYMENTS
TO PURCHASER
Section
5.01
|
Remittances.
|
On
each
Remittance Date the Company shall remit by wire transfer of immediately
available funds to the Purchaser (a) all amounts deposited in the Custodial
Account as of the close of business on the Determination Date (net of
charges
against or withdrawals from the Custodial Account pursuant to Section
4.05),
plus (b) all amounts, if any, which the Company is obligated to distribute
pursuant to Section 5.03, minus (c) any amounts attributable to Principal
Prepayments received after the applicable Principal Prepayment Period
which
amounts shall be remitted on the following Remittance Date, together
with any
additional interest required to be deposited in the Custodial Account
in
connection with such Principal Prepayment in accordance with Section
4.04(viii),
and minus (d) any amounts attributable to Monthly Payments collected
but due on
a Due Date or Dates subsequent to the first day of the month of the Remittance
Date, which amounts shall be remitted on the Remittance Date next succeeding
the
Due Period for such amounts.
52
With
respect to any remittance received by the Purchaser after the Business
Day
following the Business Day on which such payment was due, the Company
shall pay
to the Purchaser interest on any such late payment at an annual rate
equal to
the Prime Rate, adjusted as of the date of each change, plus three percentage
points, but in no event greater than the maximum amount permitted by
applicable
law. Such interest shall be deposited in the Custodial Account by the
Company on
the date such late payment is made and shall cover the period commencing
with
the day following such second Business Day and ending with the Business
Day on
which such payment is made, both inclusive. Such interest shall be remitted
along with the distribution payable on the next succeeding Remittance
Date. The
payment by the Company of any such interest shall not be deemed an extension
of
time for payment or a waiver of any Event of Default by the
Company.
Section
5.02
|
Statements
to Purchaser.
|
Not
later
than the 10th
calendar
day of each month (or if such 10th
day is
not a Business Day, the Business Day immediately preceding such 10th
day),
the Company shall furnish to the Purchaser in electronic form monthly
reports in
the form of standard ALLTEL reports in Microsoft Excel format with respect
to
the Mortgage Loans and the period from but including the first day of
the
preceding calendar month through but excluding the first day of such
month.
In
addition, the Company shall provide each Purchaser with such information
as any
Purchaser may reasonably request from time to time concerning the Mortgage
Loans
as is necessary for such Purchaser to prepare its federal income tax
return and
any and all other tax returns, information statements or other filings
required
to be delivered to any governmental taxing authority or to any Purchaser
pursuant to any applicable law with respect to the Mortgage Loans and
the
transactions contemplated hereby.
Section
5.03
|
Monthly
Advances by Company.
|
On
the
Business Day immediately preceding each Remittance Date, the Company
shall
deposit in the Custodial Account from its own funds an amount equal to
all
Monthly Payments (with interest adjusted to the Mortgage Loan Remittance
Rate)
which were due on the Mortgage Loans during the applicable Due Period
and which
were delinquent at the close of business on the immediately preceding
Determination Date or which were deferred pursuant to Section 4.01. The
Company’s obligation to make such Monthly Advances as to any Mortgage Loan will
continue through the last Monthly Payment due prior to the payment in
full of
the Mortgage Loan, or through the last Remittance Date prior to the Remittance
Date for the distribution of all Liquidation Proceeds and other payments
or
recoveries (including Insurance Proceeds and Condemnation Proceeds) with
respect
to the Mortgage Loan.
53
ARTICLE
VI
GENERAL
SERVICING PROCEDURES
Section
6.01
|
Transfers
of Mortgaged Property.
|
The
Company shall use its best efforts to enforce any “due-on-sale” provision
contained in any Mortgage or Mortgage Note and to deny assumption by
the person
to whom the Mortgaged Property has been or is about to be sold whether
by
absolute conveyance or by contract of sale, and whether or not the Mortgagor
remains liable on the Mortgage and the Mortgage Note. When the Mortgaged
Property has been conveyed by the Mortgagor, the Company shall, to the
extent it
has knowledge of such conveyance, exercise its rights to accelerate the
maturity
of such Mortgage Loan under the “due-on-sale” clause applicable thereto,
provided,
however,
that
the
Company shall not exercise such rights if prohibited by law from doing
so or if
the exercise of such rights would impair or threaten to impair any recovery
under the related PMI Policy or LPMI Policy, if any.
If
the
Company reasonably believes it is unable under applicable law to enforce
such
“due-on-sale” clause, the Company shall enter into (i) an assumption and
modification agreement with the person to whom such property has been
conveyed,
pursuant to which such person becomes liable under the Mortgage Note
and the
original Mortgagor remains liable thereon or (ii) in the event the Company
is
unable under applicable law to require that the original Mortgagor remain
liable
under the Mortgage Note and the Company has the prior consent of the
primary
mortgage guaranty insurer, a substitution of liability agreement with
the
purchaser of the Mortgaged Property pursuant to which the original Mortgagor
is
released from liability and the purchaser of the Mortgaged Property is
substituted as Mortgagor and becomes liable under the Mortgage Note.
The Company
shall notify the Purchaser that any such substitution of liability or
assumption
agreement has been completed by forwarding to the Purchaser the original
of any
such substitution of liability or assumption agreement, which document
shall be
added to the related Mortgage File and shall, for all purposes, be considered
a
part of such Mortgage File to the same extent as all other documents
and
instruments constituting a part thereof. If any fee is collected by the
Company
for entering into an assumption or substitution of liability agreement,
such fee
will be retained by the Company as additional servicing
compensation.
In
connection with any such assumption, neither the Mortgage Interest Rate
borne by
the related Mortgage Note, the term of the Mortgage Loan nor the outstanding
principal amount of the Mortgage Loan shall be changed.
To
the
extent that any Mortgage Loan is assumable, the Company shall inquire
diligently
into the creditworthiness of the proposed transferee, and shall use the
underwriting criteria for approving the credit of the proposed transferee
which
are used by Xxxxxx Mae with respect to underwriting mortgage loans of
the same
type as the Mortgage Loan. If the credit of the proposed transferee does
not
meet such underwriting criteria, the Company diligently shall, to the
extent
permitted by the Mortgage or the Mortgage Note and by applicable law,
accelerate
the maturity of the Mortgage Loan.
54
Section
6.02
|
Satisfaction
of Mortgages and Release of Mortgage Files.
|
Upon
the
payment in full of any Mortgage Loan, or the receipt by the Company of
a
notification that payment in full will be escrowed in a manner customary
for
such purposes, the Company shall notify the Purchaser by a certification
of a
servicing officer of the Company (a “Servicing Officer”), which certification
shall include a statement to the effect that all amounts received or
to be
received in connection with such payment which are required to be deposited
in
the Custodial Account pursuant to Section 4.04 have been or will be so
deposited, and shall request execution of any document necessary to satisfy
the
Mortgage Loan and delivery to it of the portion of the Mortgage File
held by the
Purchaser or the Purchaser’s designee. No expense incurred in connection with
any instrument of satisfaction or deed of reconveyance shall be chargeable
to
the Custodial Account or the Purchaser. In connection with any such prepayment
in full, the Company shall comply with all applicable laws regarding
satisfaction, release or reconveyance with respect to the Mortgage.
If
the
Company satisfies or releases a Mortgage without first having obtained
payment
in full of the indebtedness secured by the Mortgage or should the Company
otherwise prejudice any rights the Purchaser may have under the mortgage
instruments, upon written demand of the Purchaser, the Company shall
repurchase
the related Mortgage Loan at the Repurchase Price by deposit thereof
in the
Custodial Account within 2 Business Days of receipt of such demand by
the
Purchaser. The Company shall maintain the Fidelity Bond and Errors and
Omissions
Insurance Policy as provided for in Section 4.12 insuring the Company
against
any loss it may sustain with respect to any Mortgage Loan not satisfied
in
accordance with the procedures set forth herein.
Section
6.03
|
Servicing
Compensation.
|
As
compensation for its services hereunder, the Company shall be entitled
to
withdraw from the Custodial Account or to retain from interest payments
on the
Mortgage Loans the amount of its Servicing Fee. The Servicing Fee shall
be
payable monthly and shall be computed on the basis of the same unpaid
principal
balance and for the period respecting which any related interest payment
on a
Mortgage Loan is computed. The Servicing Fee shall be payable only at
the time
of and with respect to those Mortgage Loans for which payment is in fact
made of
the entire amount of the Monthly Payment. The obligation of the Purchaser
to pay
the Servicing Fee is limited to, and payable solely from, the interest
portion
of such Monthly Payments collected by the Company.
Additional
servicing compensation in the form of assumption fees and Ancillary Income
shall
be retained by the Company to the extent not required to be deposited
in the
Custodial Account. The Company shall be required to pay all expenses
incurred by
it in connection with its servicing activities hereunder and shall not
be
entitled to reimbursement thereof except as specifically provided for
herein.
55
Section
6.04
|
Annual
Statement as to Compliance.
|
(a) The
Company shall deliver to the Purchaser and to any master servicer which
is
master servicing any of the Mortgage Loans pursuant to a Pass-Through
Transfer,
Agency Transfer or other securitization transaction effected in accordance
with
Section 7.01 hereof (each, a “Master
Servicer”),
no
later than March 15th
of each
calendar year beginning March 15, 2006 (or if such day is not a Business
Day,
the immediately preceding Business Day), an Officer’s Certificate, stating as to
each signatory thereof, that (i) a review of the activities of the Company
during the preceding calendar year and of performance under this Agreement
has
been made under such officers’ supervision, (ii) the Company has complied fully
with this Agreement, and (iii) to the best of such officer’s knowledge, based on
such review, the Company has fulfilled all its obligations under this
Agreement
throughout such year, or, if there has been a default in the fulfillment
of any
such obligation, specifying each such default known to such officer and
the
nature and status thereof and the action being taken by the Company to
cure such
default. Copies of such statement may be provided by the Purchaser to
any person
identified as a prospective purchaser of any Mortgage Loans.
(b) With
respect to any Mortgage Loans that are subject to a Pass-Through Transfer,
Agency Transfer or other securitization transaction effected in accordance
with
Section 7.01 hereof, by March 15th of each calendar year (or if such
day is not
a Business Day, the immediately preceding Business Day), or at any other
time
upon thirty (30) days written request, an officer of the Company shall
execute
and deliver an Officer’s Certificate in the form attached hereto as Exhibit
G
to the
Purchaser and any Master Servicer for the benefit of each such entity
and such
entity’s affiliates and the officers, directors and agents of any such entity
and such entity’s affiliates.
(c) The
Company shall indemnify and hold harmless the Master Servicer and the
Purchaser
(and if this Agreement shall have been assigned in whole or in part by
the
Purchaser, any and all Persons previously acting as “Purchaser”
hereunder) and their respective affiliates, and in each case, their officers,
directors and agents (any such person, an “Indemnified
Party”)
from
and against any losses, damages, penalties, fines, forfeitures, reasonable
legal
fees and related costs, judgments and other costs and expenses arising
out of or
based upon a breach by the Company or any of its officers, directors,
agents or
affiliates of its obligations under this Section 6.04 or Section 6.05,
or the
negligence, bad faith or willful misconduct of the Company in connection
therewith. If the indemnification provided for herein is unavailable
or
insufficient to hold harmless any Indemnified Party, then the Company
agrees
that it shall contribute to the amount paid or payable by the Indemnified
Party
as a result of the losses, claims, damages or liabilities of the Indemnified
Party in such proportion as is appropriate to reflect the relative fault
of the
Indemnified Party on the one hand and the Company on the other in connection
with a breach of the Company’s obligations under this Section 6.04 or Section
6.05 or the Company’s negligence, bad faith or willful misconduct in connection
therewith.
Section
6.05
|
Annual
Independent Public Accountants’ Servicing Report.
|
On
or
before March 15th of each year beginning March 15, 2006, the Company,
at its
expense, shall cause a firm of independent public accountants which is
a member
of the American Institute of Certified Public Accountants to furnish
a statement
to each Purchaser to the effect that such firm has examined certain documents
and records relating to the servicing of the Mortgage Loans and this
Agreement
and that such firm is of the opinion that the provisions of this Agreement
have
been complied with, and that, on the basis of such examination conducted
substantially in compliance with the Single Attestation Program for Mortgage
Bankers, nothing has come to their attention which would indicate that
such
servicing has not been conducted in compliance therewith, except for
(i) such
exceptions as such firm shall believe to be immaterial, and (ii) such
other
exceptions as shall be set forth in such statement.
56
Section
6.06
|
Access
to Certain Documentation.
|
The
Company shall provide to the Office of Thrift Supervision, the FDIC and
any
other federal or state banking or insurance regulatory authority that
may
exercise authority over the Purchaser access to the documentation regarding
the
Mortgage Loans serviced by the Company required by applicable laws and
regulations. Such access shall be afforded without charge, but only upon
reasonable request and during normal business hours at the offices of
the
Company. In addition, access to the documentation will be provided to
the
Purchaser and any Person identified to the Company by the Purchaser without
charge, upon reasonable request during normal business hours at the offices
of
the Company.
Section
6.07
|
Reports
and Returns to be Filed by the
Company.
|
The
Company shall file information reports with respect to the receipt of
mortgage
interest received in a trade or business, reports of foreclosures and
abandonments of any Mortgaged Property and information returns relating
to
cancellation of indebtedness income with respect to any Mortgaged Property
as
required by Sections 6050H, 6050J and 6050P of the Code. Such reports
shall be
in form and substance sufficient to meet the reporting requirements imposed
by
such Sections 6050H, 6050J and 6050P of the Code.
Section
6.08
|
Compliance
with REMIC Provisions.
|
If
a
REMIC election has been made with respect to the arrangement under which
the
Mortgage Loans and REO Property are held, the Company (i) shall manage,
conserve, protect and operate each REO Property in a manner which does
not cause
such REO Property to fail to qualify as “foreclosure property” within the
meaning of Section 860G(a)(8) of the Code or result in the receipt by
such REMIC
of any “income from non-permitted assets” within the meaning of Section
860F(a)(2)(B) of the Code or any “net income from foreclosure property” within
the meaning of Section 860G(c)(2) of the Code; and (ii) shall not take
any
action, cause the REMIC to take any action or fail to take (or fail to
cause to
be taken) any action that, under the REMIC Provisions, if taken or not
taken, as
the case may be, could (A) endanger the status of the REMIC as a REMIC
or (B)
result in the imposition of a tax upon the REMIC (including but not limited
to
the tax on “prohibited transactions” as defined in Section 860F(a)(2) of the
Code and the tax on “contributions” to a REMIC set forth in Section 860G(d) of
the Code) unless the Company has received an Opinion of Counsel (at the
expense
of the party seeking to take such action) to the effect that the contemplated
action will not endanger such REMIC status or result in the imposition
of any
such tax.
57
Section
6.09
|
Right
to Examine Company Records.
|
The
Purchaser shall have the right to examine and audit any and all of the
books,
records, or other information of the Company, whether held by the Company
or by
another on its behalf, with respect to or concerning this Agreement or
the
Mortgage Loans, during business hours or at such other times as may be
reasonable under applicable circumstances, upon reasonable advance
notice.
ARTICLE
VII
AGENCY
TRANSFER; PASS-THROUGH TRANSFER
Section
7.01
|
Removal
of Mortgage Loans from Inclusion Under this Agreement Upon
an Agency
Transfer, Whole-Loan Transfer or a Pass-Through Transfer on
One or More
Reconstitution Dates.
|
The
Purchaser and the Company agree that with respect to some or all of the
Mortgage
Loans, from time to time, but with respect to the Mortgage Loans in each
Mortgage Loan Package the Purchaser shall:
(1) Effect
an
Agency Transfer; and/or
(2) Effect
a
Whole Loan Transfer; and/or
(3) Effect
a
Pass-Through Transfer.
in
each
case retaining the Company as the servicer thereof, or as applicable
the
“seller/servicer”. On the related Reconstitution Date, the Mortgage Loans
transferred shall cease to be covered by this Agreement.
Unless
otherwise agreed to between the Purchaser and the Company, the Purchaser
shall
give the Company 15 days notice of any Agency Transfer, Whole Loan Transfer
or
Pass-Through Transfer. The Company shall cooperate with the Purchaser
in
connection with any Agency Transfer, Whole Loan Transfer or Pass-Through
Transfer contemplated by the Purchaser pursuant to this Section 7.01.
In that
connection, the Company agrees:
(a)
|
to
execute any Reconstitution Agreement which is in form and substance
reasonably satisfactory to the Company and its counsel within
a reasonable
period of time after receipt of any Reconstitution Agreement
which time
shall be sufficient for the Company and Company’s counsel to review such
Reconstitution Agreement, but such time shall not exceed five
(5) Business
Days after such receipt;
|
(b)
|
to
cooperate fully with the Purchaser and any prospective purchaser
with
respect to all reasonable requests and due diligence procedures
and with
respect to the preparation (including, but not limited to,
the
endorsement, delivery, assignment, and execution) of the Mortgage
Loan
Documents and other related documents, and with respect to
servicing
requirements reasonably requested by the rating agencies and
credit
enhancers;
|
58
(c)
|
with
respect to any Agency Transfer, Whole Loan Transfer or Pass-Through
Transfer, to make reasonable, accurate and appropriate representations
and
warranties regarding the Company and, if such Agency Transfer,
Whole Loan
Transfer or Pass-Through Transfer occurs within 12 months of
the related
Closing Date or such later period as specified in the related
Trade
Confirmation, the representations and warranties regarding
the Mortgage
Loans as of the date of the Agency Transfer, Whole Loan Transfer
or
Pass-Through Transfer, modified to the extent necessary to
accurately
reflect the pool statistics of the Mortgage Loans as of the
date of such
Agency Transfer, Whole Loan Transfer or Pass-Through Transfer
and any
events or circumstances existing subsequent to the related
Closing
Date(s);
|
(d)
|
to
deliver to the Purchaser for inclusion in any prospectus or
other offering
material such publicly available information regarding the
Company, its
financial condition and its mortgage loan delinquency, foreclosure
and
loss experience and any additional information reasonably requested
by the
Purchaser that is reasonably available to the Company, and
to indemnify
the Purchaser and its affiliates for material misstatements
or omissions
contained (i) in such information and (ii) on the Mortgage
Loan
Schedule;
|
(e)
|
to
deliver to the Purchaser or any affiliate of the Purchaser,
at the
Purchaser’s expense, such statements and audit letters of reputable,
certified public accountants pertaining to information provided
by the
Company pursuant to clause (d) above as shall be reasonably
requested by
the Purchaser;
|
(f)
|
to
deliver to the Purchaser or any affiliate of the Purchaser
such legal
documents and in-house Opinions of Counsel satisfactory to
the Company as
are customarily delivered by originators or servicers, as the
case may be,
and reasonably determined by the Purchaser to be necessary
in connection
with the Agency Transfer, Whole Loan Transfers or Pass-Through
Transfers,
as the case may be, such in-house Opinions of Counsel for an
Agency
Transfer or a Pass-Through Transfer to be in the form reasonably
acceptable to the Purchaser and the Company, it being understood
that the
cost of any opinions of outside special counsel that may be
required for
an Agency Transfer, a Whole Loan Transfer or Pass-Through Transfer,
as the
case may be, shall be the responsibility of the
Purchaser;
|
(g)
|
to
negotiate and execute one or more subservicing agreements between
the
Company and any master servicer which is a prudent master servicer
in the
secondary mortgage market, designated by the Purchaser in its
sole
discretion after consultation with the Company and/or one or
more
custodial and servicing agreements among the Purchaser, the
Company and a
third party custodian/trustee which is generally considered
to be a
prudent custodian/trustee in the secondary mortgage market
designated by
the Purchaser in its sole discretion after consultation with
the Company,
in either case for the purpose of pooling the Mortgage Loans
with other
Mortgage Loans for resale or securitization;
and
|
59
(h)
|
in
connection with any securitization of any Mortgage Loans, to
execute a
pooling and servicing agreement in form and substance reasonably
satisfactory to the Company, which pooling and servicing agreement
may, at
the Purchaser’s direction, contain contractual provisions including, but
not limited to, a 24-day certificate payment delay (54-day
total payment
delay), servicer advances of delinquent scheduled payments
of principal
and interest through liquidation (unless deemed non-recoverable)
and
prepayment interest shortfalls (to the extent of the monthly
servicing fee
payable thereto), servicing and mortgage loan representations
and
warranties which in form and substance conform to the representations
and
warranties in this Agreement and to secondary market standards
for
securities backed by mortgage loans similar to the Mortgage
Loans and such
provisions with regard to servicing responsibilities, investor
reporting,
segregation and deposit of principal and interest payments,
custody of the
Mortgage Loans, and other covenants as are required by the
Purchaser and
one or more nationally recognized rating agencies for “AAA” rated mortgage
pass-through transactions which are “mortgage related securities” for the
purposes of the Secondary Mortgage Market Enhancement Act of
1984, unless
otherwise mutually agreed. At the option of the Purchaser,
the facilities
of the Depository Trust Company (“DTC”) may be used in connection with any
class of security issued pursuant to any pooling agreement,
subject only
to the consent of the DTC. If the Purchaser deems it advisable
at any time
to pool the Mortgage Loans with other mortgage loans for the
purpose of
resale or securitization, the Company agrees to execute one
or more
subservicing agreements between itself (as servicer) and a
master servicer
designated by the Purchaser and/or one or more servicing agreements
among
the Company (as servicer), the Purchaser and a trustee designated
by the
Purchaser, such agreements in each case incorporating terms
and provisions
substantially identical to those described in the immediately
preceding
paragraph.
|
In
the
event the Purchaser has elected to have the Company hold record title
to the
Mortgages, prior to a Reconstitution Date the Company or its designee
shall
prepare an Assignment of Mortgage in blank from the Company, acceptable
to
Xxxxxx Xxx, Xxxxxxx Mac, the trustee or such third party, as the case
may be,
for each Mortgage Loan that is part of an Agency Transfer, Whole Loan
Transfer
or Pass-Through Transfer and shall pay all preparation and recording
costs
associated therewith. The Company shall execute each Assignment of Mortgage,
track such Assignments of Mortgage to ensure they have been recorded
and deliver
them as required by Xxxxxx Mae, Xxxxxxx Mac, the trustee or such third
party, as
the case may be, upon the Company’s receipt thereof. Additionally, the Company
shall prepare and execute, at the direction of the Purchaser, any note
endorsements in connection with any and all Reconstitution
Agreements.
60
All
Mortgage Loans not sold or transferred pursuant to an Agency Transfer,
Whole
Loan Transfer or Pass-Through Transfer and any Mortgage Loans repurchased
by the
Purchaser pursuant to Section 7.02 hereof, shall be subject to this Agreement
and shall continue to be serviced in accordance with the terms of this
Agreement
and with respect thereto this Agreement shall remain in full force and
effect.
Unless
otherwise agreed to between the Company and the Purchaser, with respect
to any
Mortgage Loan Package, the Company will not be obligated to enter into
any
Reconstitution Agreement in connection with a Pass-Through Transfer or
Agency
Transfer in excess of any express restrictions set forth in the related
Assignment and Conveyance and related Trade Confirmation.
ARTICLE
VIII
COMPANY
TO COOPERATE
Section
8.01
|
Provision
of Information.
|
During
the term of this Agreement, the Company shall furnish to the Purchaser
such
periodic, special, or other reports or information and copies or originals
of
any documents contained in the Servicing File for each Mortgage Loan,
whether or
not provided for herein, as shall be necessary, reasonable, or appropriate
with
respect to the Purchaser, any regulatory requirement pertaining to the
Purchaser
or the purposes of this Agreement. All such reports, documents or information
shall be provided by and in accordance with all reasonable instructions
and
directions which the Purchaser may give. Any special reports or information
delivered shall be at the Purchaser’s expense.
The
Company shall execute and deliver all such instruments and take all such
action
as the Purchaser may reasonably request from time to time, in order to
effectuate the purposes and to carry out the terms of this
Agreement.
Section
8.02
|
Financial
Statements; Servicing Facility.
|
In
connection with marketing the Mortgage Loans, the Purchaser may make
available
to a prospective Purchaser a Consolidated Statement of Operations of
the Company
for the most recently completed five fiscal years for which such a statement
is
available, as well as a Consolidated Statement of Condition at the end
of the
last two fiscal years covered by such Consolidated Statement of Operations.
Purchaser shall not make such statement available to any prospective
Purchaser
unless such prospective Purchaser has signed a confidentiality agreement
with
respect to the information provided with respect to Company unless already
publicly available. The Company also shall make available any comparable
interim
statements to the extent any such statements have been prepared by or
on behalf
of the Company (and are available upon request to members or stockholders
of the
Company or to the public at large). If it has not already done so, the
Company
shall furnish promptly to the Purchaser copies of the statement specified
above.
The
Company also shall make available to Purchaser or prospective Purchaser
a
knowledgeable financial or accounting officer for the purpose of answering
questions respecting recent developments affecting the Company or the
financial
statements of the Company, and to permit any prospective Purchaser to
inspect
the Company’s servicing facilities or those of any Subservicer for the purpose
of satisfying such prospective Purchaser that the Company and any Subservicer
have the ability to service the Mortgage Loans as provided in this
Agreement.
61
ARTICLE
IX
THE
COMPANY
Section
9.01
|
Indemnification;
Third Party Claims.
|
(a)
Breaches
of Representations and Warranties.
The
Company agrees to indemnify the Purchaser and hold it harmless from and
against
any and all claims, losses, damages, penalties, fines, forfeitures, legal
fees
and related costs, judgments, and any other costs, fees and expenses
that the
Purchaser may sustain in any way related to any assertion based on, grounded
upon resulting from a Breach of any of the Company’s representations and
warranties contained herein. The Company shall immediately notify the
Purchaser
if a claim is made by a third party with respect to this Agreement or
the
Mortgage Loans, assume (with the consent of the Purchaser and with counsel
reasonably satisfactory to the Purchaser) the defense of any such claim
and pay
all expenses in connection therewith, including counsel fees, and promptly
pay,
discharge and satisfy any judgment or decree which may be entered against
it or
the Purchaser in respect of such claim but failure to so notify the Purchaser
shall not limit its obligations hereunder. The Company agrees that it
will not
enter into any settlement of any such claim without the consent of the
Purchaser
unless such settlement includes an unconditional release of the Purchaser
from
all liability that is the subject matter of such claim. In addition to
the
obligations of the Company set forth in this Section 9.01(a), the Purchaser
may
pursue any and all remedies otherwise available at law or in equity,
including,
but not limited to, the right to seek damages. The provisions of this
Section
9.01(a) shall survive termination of this Agreement.
It
is
understood and agreed that the obligations of the Company set forth in
Sections
3.03 and 9.01(a) to cure, substitute for or repurchase a defective Mortgage
Loan
and to indemnify the Purchaser constitute the sole remedies of the Purchaser
respecting a Breach of the representations and warranties set forth in
Section
3.01 and 3.02. The indemnification obligation of the Company set forth
herein
shall survive the termination of this Agreement.
(b) Servicing.
The
Company shall indemnify the Purchaser and hold it harmless against any
and all
claims, losses, damages, penalties, fines, and forfeitures, including,
but not
limited to reasonable and necessary legal fees and related costs, judgments,
and
any other costs, fees and expenses that the Purchaser may sustain in
any way
related to the failure of the Company to (a) perform its duties and service
the
Mortgage Loans in strict compliance with the terms of this Agreement
or any
Reconstitution Agreement entered into pursuant to Section 7.01, and/or
(b)
comply with applicable law, and/or (c) perform any other covenants set
forth in
this Agreement. The Company immediately shall notify the Purchaser if
a claim is
made by a third party with respect to this Agreement or any Reconstitution
Agreement or the Mortgage Loans, shall promptly notify Xxxxxx Mae, Xxxxxxx
Mac,
or the trustee with respect to any claim made by a third party with respect
to
any Reconstitution Agreement, assume (with the prior written consent
of the
Purchaser) the defense of any such claim and pay all expenses in connection
therewith, including counsel fees, and promptly pay, discharge and satisfy
any
judgment or decree which may be entered against it or the Purchaser in
respect
of such claim. The Company shall follow any written instructions received
from
the Purchaser in connection with such claim. The Purchaser promptly shall
reimburse the Company for all amounts advanced by it pursuant to the
preceding
sentence except when the claim is in any way related to the Company’s
indemnification pursuant to Section 3.03, or the failure of the Company
to (a)
service and administer the Mortgage Loans in strict compliance with the
terms of
this Agreement or any Reconstitution Agreement, and/or (b) comply with
applicable law. The indemnification obligation of the Company set forth
herein
shall survive the termination of this Agreement.
62
Section
9.02
|
Merger
or Consolidation of the Company.
|
The
Company shall keep in full effect its existence, rights and franchises
as a
corporation, and shall 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 Company may be merged or consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Company
shall be a party, or any Person succeeding to the business of the Company,
shall
be the successor of the Company hereunder, without the execution or filing
of
any paper or any further act on the part of any of the parties hereto,
anything
herein to the contrary notwithstanding, provided,
however,
that
in the
event that such successor servicer is not acceptable to the Purchaser
in its
sole discretion, the Purchaser shall have the right to terminate the
successor
servicer’s rights under this servicing agreement without payment of any
termination fee.
Section
9.03
|
Limitation
on Liability of Company and Others.
|
Neither
the Company nor any of the directors, officers, employees or agents of
the
Company shall be under any liability to the Purchaser for any action
taken or
for refraining from the taking of any action in good faith pursuant to
this
Agreement, or for errors in judgment, provided,
however,
that
this
provision shall not protect the Company or any such person against any
Breach of
warranties or representations made herein, or failure to perform its
obligations
in strict compliance with any standard of care set forth in this Agreement,
or
any liability which would otherwise be imposed by reason of any breach
of the
terms and conditions of this Agreement. The Company and any director,
officer,
employee or agent of the Company may rely in good faith on any document
of any
kind prima facie properly executed and submitted by any Person respecting
any
matters arising hereunder. The Company shall not be under any obligation
to
appear in, prosecute or defend any legal action which is not incidental
to its
duties to service the Mortgage Loans in accordance with this Agreement
and which
in its opinion may involve it in any expense or liability, provided,
however,
that
the
Company may, with the consent of the Purchaser, undertake any such action
which
it may deem necessary or desirable in respect to this Agreement and the
rights
and duties of the parties hereto. In such event, the Company shall be
entitled
to reimbursement from the Purchaser of the reasonable legal expenses
and costs
of such action except when such expenses and costs are subject to the
Company’s
indemnification under this Agreement.
63
Section
9.04
|
Limitation
on Resignation and Assignment by Company.
|
The
Company acknowledges that the Purchaser has entered into this Agreement
with the
Company, and that subsequent Purchasers will purchase the Mortgage Loans,
in
reliance upon the independent status of the Company, and the representations
as
to the adequacy of its servicing facilities, plant, personnel, records
and
procedures, its integrity, reputation and financial standing, and the
continuance thereof. Therefore, the Company shall neither assign this
Agreement
or the servicing hereunder or delegate its rights or duties hereunder
or any
portion hereof (to other than a Subservicer).
The
Company shall not resign from the obligations and duties hereby imposed
on it
except by mutual consent of the Company and the Purchaser or upon the
determination that its duties hereunder are no longer permissible under
applicable law and such incapacity cannot be cured by the Company in
which event
the Company may resign as servicer. Any such determination permitting
the
resignation of the Company shall be evidenced by an Opinion of Counsel
to such
effect delivered to the Purchaser which Opinion of Counsel shall be in
form and
substance acceptable to the Purchaser and which shall be provided at
the cost of
the Company. No such resignation shall become effective until a successor
shall
have assumed the Company’s responsibilities and obligations hereunder in the
manner provided in Section 12.01.
Without
in any way limiting the generality of this Section 9.04, in the event
that the
Company either shall assign this Agreement or the servicing responsibilities
hereunder or delegate its duties hereunder or any portion thereof (to
other than
a Subservicer) or sell or otherwise dispose of all or substantially all
of its
property or assets, without the prior written consent of the Purchaser,
then the
Purchaser shall have the right to terminate this Agreement upon notice
given as
set forth in Section 10.01, without any payment of any penalty or damages
and
without any liability whatsoever to the Company or any third party.
ARTICLE
X
DEFAULT
Section
10.01
|
Events
of Default.
|
Each
of
the following shall constitute an Event of Default on the part of the
Company:
(i) any
failure by the Company to remit to the Purchaser any payment required
to be made
under the terms of this Agreement which continues unremedied for a period
of two
days after the date upon which written notice of such failure, requiring
the
same to be remedied, shall have been given to the Company by the Purchaser;
or
(ii) failure
by the Company duly to observe or perform in any material respect any
other of
the covenants or agreements on the part of the Company set forth in this
Agreement which continues unremedied for a period of 30 days (except
that such
number of days shall be fifteen 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 Company by the Purchaser; or
64
(iii) failure
by the Company to maintain its license to do business in any jurisdiction
where
the Mortgage Property is located; or
(iv) a
decree
or order of a court or agency or supervisory authority having jurisdiction
for
the appointment of a conservator or receiver or liquidator in any insolvency,
readjustment of debt, including bankruptcy, marshaling of assets and
liabilities
or similar proceedings, or for the winding-up or liquidation of its affairs,
shall have been entered against the Company and such decree or order
shall have
remained in force undischarged or unstayed for a period of 60 days;
or
(v) the
Company shall consent to the appointment of a conservator or receiver
or
liquidator in any insolvency, readjustment of debt, marshaling of assets
and
liabilities or similar proceedings of or relating to the Company or of
or
relating to all or substantially all of its property; or
(vi) the
Company 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,
bankruptcy or reorganization statute, make an assignment for the benefit
of its
creditors, voluntarily suspend payment of its obligations or cease its
normal
business operations for three Business Days; or
(vii) the
Company ceases to meet the qualifications of a Xxxxxx Xxx or Xxxxxxx
Mac
seller/servicer; or
(viii) the
Company fails to maintain a minimum net worth of $25,000,000; or
(ix) the
Company attempts to assign its right to servicing compensation hereunder
or the
Company attempts, without the consent of the Purchaser, to sell or otherwise
dispose of all or substantially all of its property or assets or to assign
this
Agreement or the servicing responsibilities hereunder or to delegate
its duties
hereunder or any portion thereof (to other than a Subservicer) in violation
of
Section 9.04; or
(x) S&P,
Xxxxx’x or any other rating agency lowers the Company’s servicing rating below
“average” or the equivalent rating from any Rating Agency after the date of this
Agreement or a lowering of the Company’s servicer rating has a material and
adverse affect on any securities issued pursuant to a Pass-Through Transfer;
or
(xi) the
Company fails to duly perform, within the required time period, its obligations
under Section 6.04 and Section 6.05 of this Agreement, which failure
continues
unremedied for a period of fifteen (15) days after the date on which
written
notice of such failure, requiring the same to be remedied, shall have
been given
to the Company by any party to this Agreement or by any Master Servicer
responsible for master servicing any Mortgage Loans pursuant to a securitization
of such Mortgage Loans.
65
In
each
and every such case, so long as an Event of Default shall not have been
remedied, in addition to whatsoever rights the Purchaser may have at
law or
equity to damages, including injunctive relief and specific performance,
the
Purchaser, by notice in writing to the Company, may terminate all the
rights and
obligations of the Company under this Agreement and in and to the Mortgage
Loans
and the proceeds thereof without payment of any termination fee.
Upon
receipt by the Company of such written notice, all authority and power
of the
Company 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. Upon written request from any Purchaser, the Company shall
prepare, execute and deliver to the successor entity designated by the
Purchaser
any and all documents and other instruments, place in such successor’s
possession all Mortgage Files, and do or cause to be done all other acts
or
things necessary or appropriate to effect the purposes of such notice
of
termination, including but not limited to the transfer and endorsement
or
assignment of the Mortgage Loans and related documents, at the Company’s sole
expense. The Company shall cooperate with the Purchaser and such successor
in
effecting the termination of the Company’s responsibilities and rights
hereunder, 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 Company to the Custodial Account or Escrow Account or thereafter
received
with respect to the Mortgage Loans.
If
any of
the Mortgage Loans are MERS Mortgage Loans, in connection with the termination
or resignation (as described in Section 9.04) of the Company hereunder,
either
(i) the successor Company shall represent and warrant that it is a member
of
MERS in good standing and shall agree to comply in all material respects
with
the rules and procedures of MERS in connection with the servicing of
the
Mortgage Loans that are registered with MERS, or (ii) the Company shall
cooperate with the successor company either (x) in causing MERS to execute
and
deliver an assignment of Mortgage in recordable form to transfer the
Mortgage
from MERS to the Purchaser and to execute and deliver such other notices,
documents and other instruments as may be necessary or desirable to effect
a
transfer of such Mortgage Loan or servicing of such Mortgage Loan on
the MERS
System to the successor company or (y) in causing MERS to designate on
the MERS
System the successor company as the servicer of such Mortgage Loan.
Section
10.02
|
Waiver
of Defaults.
|
By
a
written notice, the Purchaser may waive any default by the Company in
the
performance of its obligations hereunder and its consequences. Upon any
waiver
of a past default, such default shall cease to exist, and any Event of
Default
arising therefrom shall be deemed to have been remedied for every purpose
of
this Agreement. No such waiver shall extend to any subsequent or other
default
or impair any right consequent thereon except to the extent expressly
so
waived.
66
ARTICLE
XI
TERMINATION
Section
11.01
|
Termination.
|
This
Agreement shall terminate upon either: (i) the later of the final payment
or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or the disposition of any REO Property with respect to the last
Mortgage
Loan and the remittance of all funds due hereunder; or (ii) mutual consent
of
the Company and the Purchaser in writing.
Section
11.02
|
Termination
Without Cause.
|
The
Purchaser may terminate, at its sole option, any rights the Company may
have
hereunder, without cause, upon sixty days notice or as provided in this
Section
11.02. Any such notice of termination shall be in writing and delivered
to the
Company by registered mail as provided in Section 12.05. The Purchaser
and the
Servicer shall comply with the termination procedures set forth in Section
12.01
hereof.
In
the
event the Purchaser terminates the Company without cause with respect
to some or
all of the Mortgage Loans, the Purchaser shall be required to pay to
the Company
a Termination Fee in an amount equal to the product of (a) the fair market
value
of the related servicing rights as mutually agreed to between the Company
and
the Purchaser and (b) the Stated Principal Balance, as of the date of
such
termination, of each such Mortgage Loan.
Notwithstanding
and in addition to the foregoing, in the event that (i) a Mortgage Loan
becomes
delinquent for a period of 91 days or more (a “Delinquent
Mortgage Loan”)
or
(ii) a Mortgage Loan becomes an REO Property, the Purchaser may at its
election
terminate this Agreement with respect to such Delinquent Mortgage Loan
or REO
Property without payment of a termination fee therefor, upon 15 days’ written
notice to the Company.
ARTICLE
XII
MISCELLANEOUS
PROVISIONS
Section
12.01
|
Successor
to Company.
|
Prior
to
termination of the Company’s responsibilities and duties under this Agreement
pursuant to Sections 9.04, 10.01, 11.01(ii) or pursuant to Section 11.02
after
the 90 day period has expired, the Purchaser shall, (i) succeed to and
assume
all of the Company’s responsibilities, rights, duties and obligations under this
Agreement, or (ii) appoint a successor having the characteristics set
forth in
clauses (i) through (iii) of Section 9.02 and which shall succeed to
all rights
and assume all of the responsibilities, duties and liabilities of the
Company
under this Agreement prior to the termination of Company’s responsibilities,
duties and liabilities under this Agreement. In connection with such
appointment
and assumption, the Purchaser may make such arrangements for the reasonable
compensation of such successor out of payments on Mortgage Loans as it
and such
successor shall agree. In the event that the Company’s duties, responsibilities
and liabilities under this Agreement should be terminated pursuant to
the
aforementioned sections, the Company shall discharge such duties and
responsibilities during the period from the date it acquires knowledge
of such
termination until the effective date thereof with the same degree of
diligence
and prudence which it is obligated to exercise under this Agreement,
and shall
take no action whatsoever that might impair or prejudice the rights or
financial
condition of its successor. The resignation or removal of the Company
pursuant
to the aforementioned sections shall not become effective until a successor
shall be appointed pursuant to this Section 12.01 and shall in no event
relieve
the Company of the representations and warranties made pursuant to Sections
3.01
and 3.02 and the remedies available to the Purchaser under Sections 3.03,
and
3.06, it being understood and agreed that the provisions of such Sections
3.01,
3.02, 3.03, and 3.06 shall be applicable to the Company notwithstanding
any such
sale, assignment, resignation or termination of the Company, or the termination
of this Agreement.
67
Any
successor appointed as provided herein shall execute, acknowledge and
deliver to
the Company and to the Purchaser an instrument accepting such appointment,
whereupon such successor shall become fully vested with all the rights,
powers,
duties, responsibilities, obligations and liabilities of the Company,
with like
effect as if originally named as a party to this Agreement. Any termination
or
resignation of the Company or termination of this Agreement pursuant
to Section
9.04, 10.01, 11.01 or 11.02 shall not affect any claims that any Purchaser
may
have against the Company arising out of the Company’s actions or failure to act
prior to any such termination or resignation.
The
Company shall deliver promptly to the successor servicer the Funds in
the
Custodial Account and Escrow Account and all Mortgage Files and related
documents and statements held by it hereunder and the Company shall account
for
all funds and shall execute and deliver such instruments and do such
other
things as may reasonably be required to more fully and definitively vest
and
confirm in the successor all such rights, powers, duties, responsibilities,
obligations and liabilities of the Company. The successor shall make
arrangements as it may deem appropriate to reimburse the Company for
amounts the
Company actually expended as servicer pursuant to this Agreement which
the
successor is entitled to retain hereunder and which would otherwise have
been
recovered by the Company pursuant to this Agreement but for the appointment
of
the successor servicer.
Upon
a
successor’s acceptance of appointment as such, the Company shall notify by mail
the Purchaser of such appointment in accordance with the procedures set
forth in
Section 12.05.
Section
12.02
|
[RESERVED]
|
Section
12.03
|
Mandatory
Delivery: Grant of Security
Interest.
|
The
sale
and delivery of each Mortgage Loan on or before the related Closing Date
is
mandatory from and after the date of the execution of the related Trade
Confirmation, it being specifically understood and agreed that each Mortgage
Loan is unique and identifiable on the date hereof and that an award
of money
damages would be insufficient to compensate the Purchaser for the losses
and
damages incurred by the Purchaser (including damages to prospective purchasers
of the Mortgage Loans) in the event of the Company’s failure to deliver each of
the related Mortgage Loans or one or more Mortgage Loans otherwise acceptable
to
the Purchaser on or before the related Closing Date. The Company hereby
grants
to the Purchaser a lien on and a continuing security interest in each
Mortgage
Loan and each document and instrument evidencing each such Mortgage Loan
to
secure the performance by the Company of its obligation hereunder, and
the
Company agrees that it holds such Mortgage Loans in custody for the Purchaser
subject to the Purchaser’s (i) right to reject any Mortgage Loan under the terms
of this Agreement and the related Trade Confirmation, and (ii) obligation
to pay
the related Purchase Price for the Mortgage Loans. All rights and remedies
of
the Purchaser under this Agreement are distinct from, and cumulative
with, any
other rights or remedies under this Agreement or afforded by law or equity
and
all such rights and remedies may be exercised concurrently, independently
or
successively.
68
Section
12.04
|
Amendment.
|
This
Agreement may be amended from time to time by the Company and the Purchaser
by
written agreement signed by the Company and the Purchaser.
Section
12.05
|
Governing
Law.
|
THIS
AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW
YORK AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section
12.06
|
Duration
of Agreement.
|
This
Agreement shall continue in existence and effect until terminated as
herein
provided. This Agreement shall continue notwithstanding transfers of
the
Mortgage Loans by the Purchaser.
Section
12.07
|
Notices.
|
All
demands, notices and communications hereunder shall be in writing and
shall be
deemed to have been duly given if personally delivered at or mailed by
registered mail, postage prepaid, addressed as follows:
(i) if
to the
Company:
National
City Mortgage Co.
ATTN:
Xxxxxx X. Xxxxxxxx
0000
Xxxxxxx Xx.
Xxxxxxxxxx,
XX 00000
with
a
copy to:
National
City Mortgage Co.
ATTN:
X.
Xxxxxxx Case
0000
Xxxxxxx Xx.
Xxxxxxxxxx,
XX 00000
or
such
other address as may hereafter be furnished to the Purchaser in writing
by the
Company;
69
(ii) if
to
Purchaser:
DB
Structured Products, Inc.
00
Xxxx
Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxxxx Xxxxxxxxx
or
such
other address as may hereafter be furnished to the Company in writing
by the
Purchaser.
Section
12.08
|
Severability
of Provisions.
|
If
any
one or more of the representations, warranties, covenants, agreements,
provisions or terms of this Agreement shall be held invalid for any reason
whatsoever, then such covenants, agreements, provisions or terms shall
be deemed
severable from the remaining covenants, agreements, provisions or terms
of this
Agreement and shall in no way affect the validity or enforceability of
the other
provisions of this Agreement. Any one or more of the representations,
warranties, covenants, agreements, provisions or terms of this Agreement
which
is or are held invalid for any purpose in any jurisdiction shall be ineffective,
as to such jurisdiction, to the extent of such invalidity without invalidating
the remaining provisions hereof, and any such invalidity in any jurisdiction
as
to any Mortgage Loan shall not invalidate or render unenforceable such
provision
in any other jurisdiction. To the extent permitted by applicable law,
the
parties hereto waive any provision of law which prohibits or renders
void or
unenforceable any provision hereof. If the invalidity of any representation,
warranty, covenant, agreement, provision or term of this Agreement shall
deprive
any party of the economic benefit intended to be conferred by this Agreement,
the parties shall negotiate, in good-faith, to develop a structure the
economic
effect of which is nearly as possible the same as the economic effect
of this
Agreement without regard to such invalidity.
Section
12.09
|
Relationship
of Parties.
|
Nothing
herein contained shall be deemed or construed to create a partnership
or joint
venture between the parties hereto and the services of the Company shall
be
rendered as an independent contractor and not as agent for the
Purchaser.
Section
12.10
|
Execution;
Successors and Assigns.
|
This
Agreement may be executed in one or more counterparts and by the different
parties hereto on separate counterparts, each of which, when so executed,
shall
be deemed to be an original; such counterparts, together, shall constitute
one
and the same agreement. Subject to Section 9.04, this Agreement shall
inure to
the benefit of and be binding upon the Company and the Purchaser and
their
respective successors and assigns.
Section
12.11
|
Recordation
of Assignments of Mortgage.
|
To
the
extent permitted by applicable law, each of the Assignments of Mortgage
is
subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which
any or
all of the Mortgaged Properties are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected
at the
Company’s expense in the event recordation is either necessary under applicable
law or requested by the Purchaser at its sole option.
70
Section
12.12
|
Assignment
by Purchaser.
|
The
Purchaser shall have the right, without the consent of the Company but
subject
to the limit set forth in Section 2.02 hereof, to assign, in whole or
in part,
its interest under this Agreement with respect to some or all of the
Mortgage
Loans, and designate any person to exercise any rights of the Purchaser
hereunder. All references to the Purchaser in this Agreement shall be
deemed to
include its assignee or designee.
Upon
any
such assignment, the Person to whom such assignment is made shall succeed
to all
rights and obligations of the Purchaser under this Agreement to the extent
of
the related Mortgage Loan or Mortgage Loans and this Agreement, to the
extent of
the related Mortgage Loan or Loans, shall be deemed to be a separate
and
distinct Agreement between the Company and such Purchaser, and a separate
and
distinct Agreement between the Company and each other Purchaser to the
extent of
the other related Mortgage Loan or Loans. In the event that this Agreement
is
assigned to any Person to whom the servicing or master servicing of any
Mortgage
Loan is sold or transferred, the rights and benefits under this agreement
which
inure to the Purchaser shall inure to the benefit of both the Person
to whom
such Mortgage Loan is transferred and the Person to whom the servicing
or master
servicing of the Mortgage Loan has been transferred; provided that,
the
right to require a Mortgage Loan to be repurchased by the Company pursuant
to
Section 3.02 or 3.04 shall be retained solely by the Purchaser. This
Agreement
shall not be assigned, pledged or hypothecated by the Company to a third
party
without the consent of the Purchaser, which consent shall not be unreasonably
withheld.
Section
12.13
|
No
Personal Solicitation.
|
From
and
after the related Closing Date, the Company hereby agrees that it will
not take
any action or permit or cause any action to be taken by any of its agents
or
affiliates, or by any independent contractors on the Company’s behalf, to
personally, by telephone or mail, solicit the borrower or obligor under
any
Mortgage Loan for any purpose whatsoever, including to refinance a Mortgage
Loan, in whole or in part, without the prior written consent of the Purchaser
or
any of its assignees; provided that
the
Company may solicit any Mortgagor for whom the Company has received a
request
for demand for payoff or a borrower or obligor initiated communication
indicating a desire to prepay the related Mortgage Loan. It is understood
and
agreed that all rights and benefits relating to the solicitation of any
Mortgagors and the attendant rights, title and interest in and to the
list of
such Mortgagors and data relating to their Mortgages (including insurance
renewal dates) shall be transferred to the Purchaser pursuant hereto
on the
related Closing Date and the Company shall take no action to undermine
these
rights and benefits. Notwithstanding the foregoing, it is understood
and agreed
that promotions undertaken by the Company or any affiliate of the Company
which
are directed to the general public at large, or designated segments thereof,
including, without limitation, mass mailings based on commercially acquired
mailing lists, and newspaper, radio and television advertisements shall
not
constitute solicitation under this Section 12.11.
Section
12.14
|
Intention
of the Parties.
|
It
is the
intention of the parties that the Purchaser is purchasing, and the Company
is
selling, the Mortgage Loans and not a debt instrument of the Company
or another
security. Accordingly, the parties hereto each intend to treat the transaction
for Federal income tax purposes as a sale by the Company, and a purchase
by the
Purchaser, of the Mortgage Loans. The Purchaser shall have the right
to review
the Mortgage Loans and the related Mortgage Loan Files to determine the
characteristics of the Mortgage Loans which shall affect the Federal
income tax
consequences of owning the Mortgage Loans and the Company shall cooperate
with
all reasonable requests made by the Purchaser in the course of such review.
In
the event, for any reason, any transaction contemplated herein is construed
by
any court or regulatory authority as a borrowing rather than as a sale,
the
Company and the Purchaser intend that the Purchaser or its assignee,
as the case
may be, shall have a perfected first priority security interest in the
Mortgage
Loans, the Custodial Account and the proceeds of any and all of the foregoing
(collectively, the “Collateral”), free and clear of adverse claims. In such
case, the Company shall be deemed to have hereby granted to the Purchaser
or its
assignee, as the case may be, a first priority security interest in and
lien
upon the Collateral, free and clear of adverse claims. In such event,
the
related Trade Confirmation and this Agreement shall constitute a security
agreement, the Custodian shall be deemed to be an independent custodian
for
purposes of perfection of the security interest granted to the Purchaser
or its
assignee, as the case may be, and the Purchaser or its assignee, as the
case may
be, shall have all of the rights of a secured party under applicable
law.
71
Section
12.15
|
Third
Party Beneficiary.
|
For
purposes of this Agreement, including but not limited to Section 6.04
and
Section 6.05, any Master Servicer shall be considered a third party beneficiary
to this Agreement entitled to all the rights and benefits accruing to
any Master
Servicer herein as if it were a direct party to this Agreement.
Section
12.16
|
Waivers.
|
No
term
or provision of this Agreement may be waived or modified unless such
waiver or
modification is in writing and signed by the party against whom such
waiver or
modification is sought to be enforced.
Section
12.17
|
Exhibits.
|
The
exhibits to this Agreement are hereby incorporated and made a part hereof
and
are an integral part of this Agreement.
Section
12.18
|
General
Interpretive Principles.
|
For
purposes of this Agreement, except as otherwise expressly provided or
unless the
context otherwise requires:
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;
accounting
terms not otherwise defined herein have the meanings assigned to them
in
accordance with generally accepted accounting principles;
72
references
herein to “Articles,” “Sections,” “Subsections,” “Paragraphs,” and other
subdivisions without reference to a document are to designated Articles,
Sections, Subsections, Paragraphs and other subdivisions of this
Agreement;
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;
the
words
“herein,” “hereof,” “hereunder” and other words of similar import refer to this
Agreement as a whole and not to any particular provision; and
the
term
“include” or “including” shall mean without limitation by reason of
enumeration.
Section
12.19
|
Reproduction
of Documents.
|
This
Agreement and all documents relating thereto, including, without limitation,
(a)
consents, waivers and modifications which may hereafter be executed,
(b)
documents received by any party at the closing, and (c) financial statements,
certificates and other information previously or hereafter furnished,
may be
reproduced by any photographic, photostatic, microfilm, micro-card, 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
12.20
|
Further
Agreements.
|
The
Company and the Purchaser each agree to execute and deliver to the other
such
reasonable and appropriate additional documents, instruments or agreements
as
may be necessary or appropriate to effectuate the purposes of this
Agreement.
73
IN
WITNESS WHEREOF,
the
Company and the Purchaser have caused their names to be signed hereto
by their
respective officers thereunto duly authorized as of the day and year
first above
written.
DB
STRUCTURED PRODUCTS, INC.
By:
_____________________________
Name:
___________________________
Title:
____________________________
By:
_____________________________
Name:
___________________________
Title:
____________________________ NATIONAL
CITY MORTGAGE CO.
By:
_____________________________
Name:
___________________________
Title:
____________________________
|
74
EXHIBIT
A
MORTGAGE
LOAN SCHEDULE
A-1
EXHIBIT
B
CONTENTS
OF EACH MORTGAGE FILE
With
respect to each Mortgage Loan, the Mortgage File shall include each of
the
following items, which shall be available for inspection by the Purchaser
and
any prospective Purchaser, and which shall be retained by the Company
in the
Servicing File or delivered to the Custodian pursuant to Section 2.01
and 2.03
of the Master Seller’s Warranties and Servicing Agreement to which this Exhibit
is attached (the “Agreement”):
1.
|
The
original Mortgage Note bearing all intervening endorsements
necessary to
show a complete chain of endorsements from the original payee
to the
Company, endorsed in blank, “Pay to the order of _________ without
recourse”, signed via original signature in the name of the Company
by an
authorized officer and if previously endorsed, signed in the
name of the
last endorsee by a duly qualified officer of the last endorsee.
If the
Mortgage Loan was acquired by the Company in a merger, the
signature must
be in the following form: “National City Mortgage Co., successor by merger
to [name of predecessor]”; and if the Mortgage Loan was acquired or
originated by the Company while doing business under another
name, the
signature must be in the following form: “National City Mortgage Co.,
formerly known as [previous name]”
|
If
the
Company uses facsimile signatures to endorse Mortgage Notes, the Company
must
provide in an Officer’s Certificate that the endorsement is valid and
enforceable in the jurisdiction(s) in which the Mortgaged Properties
are located
and must retain in its corporate records the following specific documentation
authorizing the use of facsimile signatures: (i) a resolution from its
board of
directors authorizing specific officers to use facsimile signatures;
stating
that facsimile signatures will be a valid and binding act on the Company’s part;
and authorizing the Company’s corporate secretary to certify the validity of the
resolution, the names of the officers authorized to execute documents
by using
facsimile signatures, and the authenticity of specimen forms of facsimile
signatures; (ii) the corporate secretary’s certification of the authenticity and
validity of the board of directors’ resolution; and (iii) a notarized
“certification of facsimile signature,” which includes both the facsimile and
the original signatures of the signing officer(s) and each officer’s
certification that the facsimile is a true and correct copy of his or
her
original signature
2.
|
The
original of any guarantee executed in connection with the Mortgage
Note
(if any).
|
3.
|
The
original Mortgage, with evidence of recording thereon. If in
connection
with any Mortgage Loan, the Company cannot deliver or cause
to be
delivered the original Mortgage with evidence of recording
thereon on or
prior to the related Closing Date because of a delay caused
by the public
recording office where such Mortgage has been delivered for
recordation or
because such Mortgage has been lost or because such public
recording
office retains the original recorded Mortgage, the Company
shall deliver
or cause to be delivered to the Custodian, a photocopy of such
Mortgage,
together with (i) in the case of a delay caused by the public
recording
office, an Officer’s Certificate of the title insurer insuring the
Mortgage stating that such Mortgage has been dispatched to
the appropriate
public recording office for recordation and that the original
recorded
Mortgage or a copy of such Mortgage certified by such public
recording
office to be a true and complete copy of the original recorded
Mortgage
will be promptly delivered to the Custodian upon receipt thereof
by the
party delivering the Officer’s Certificate or by the Company; or (ii) in
the case of a Mortgage where a public recording office retains
the
original recorded Mortgage or in the case where a Mortgage
is lost after
recordation in a public recording office, a copy of such Mortgage
certified by such public recording office or by the title nsurance
company
that issued the title policy to be a true and complete copy
of the
original recorded Mortgage.
|
B-1
4.
|
The
originals of all assumption, modification, consolidation or
extension
agreements, with evidence of recording
thereon.
|
5.
|
The
original Assignment of Mortgage for each Mortgage Loan, in
form and
substance acceptable for recording, delivered in blank. If
the Mortgage
Loan was acquired by the Company in a merger, the Assignment
of Mortgage
must be made by “National City Mortgage Co., successor by merger to [name
of predecessor].” If the Mortgage Loan was acquired or originated by the
Company while doing business under another name, the Assignment
of
Mortgage must be by “National City Mortgage Co., formerly known as
[previous name].”
|
6.
|
Originals
of all intervening assignments of the Mortgage with evidence
of recording
thereon evidencing a complete chain of ownership from the originator
of
the Mortgage Loan to the last assignee, or if any such intervening
assignment has not been returned from the applicable recording
office or
has been lost or if such public recording office retains the
original
recorded assignments of mortgage, the Company shall deliver
or cause to be
delivered to the Custodian, a photocopy of such intervening
assignment,
together with (i) in the case of a delay caused by the public
recording
office, an Officer’s Certificate of the title insurer insuring the
Mortgage stating that such intervening assignment of mortgage
has been
dispatched to the appropriate public recording office for recordation
and
that such original recorded intervening assignment of mortgage
or a copy
of such intervening assignment of mortgage certified by the
appropriate
public recording office or by the title insurance company that
issued the
title policy to be a true and complete copy of the original
recorded
intervening assignment of mortgage will be promptly delivered
to the
Custodian upon receipt thereof by the party delivering the
Officer’s
Certificate or by the Company; or (ii) in the case of an intervening
assignment where a public recording office retains the original
recorded
intervening assignment of Mortgage or in the case where an
intervening
assignment is lost after recordation in a public recording
office, a copy
of such intervening assignment certified by such public recording
office
to be a true and complete copy of the original recorded intervening
assignment.
|
B-2
7.
|
The
original PMI Policy, LPMI Policy or certificate of insurance,
where
required pursuant to the Agreement.
|
8.
|
The
original mortgagee policy of title insurance or attorney’s opinion of
title and abstract of title (provided such attorney’s opinion of title is
customary for such jurisdiction) in the form of an ALTA mortgage
title
insurance policy, containing each of the endorsements required
by Xxxxxx
Xxx and insuring the Purchaser and its successors and assigns
as to the
first priority lien of the Mortgage in the original principal
amount of
the Mortgage Loan or, if the original mortgagee policy of title
insurance
has not been issued, the irrevocable commitment to issue the
same.
|
9.
|
Any
security agreement, chattel mortgage or equivalent executed
in connection
with the Mortgage.
|
10.
|
The
original hazard insurance policy and, if required by law, flood insurance
policy, in accordance with Section 4.10 of the
Agreement.
|
11.
|
Residential
loan application.
|
12.
|
Mortgage
Loan closing statement.
|
13.
|
Verification
of employment and income.
|
14.
|
Verification
of acceptable evidence of source and amount of
downpayment.
|
15.
|
Credit
report on the Mortgagor.
|
16.
|
Residential
appraisal report.
|
17.
|
Photograph
of the Mortgaged Property.
|
18.
|
Survey
of the Mortgaged Property.
|
19.
|
Copy
of each instrument necessary to complete identification of
any exception
set forth in the exception schedule in the title policy, i.e.,
map or
plat, restrictions, easements, sewer agreements, home association
declarations, etc.
|
20.
|
All
required disclosure statements and statement of Mortgagor confirming
receipt thereof.
|
21.
|
If
available, termite report, structural engineer’s report, water potability
and septic certification.
|
22.
|
Sales
contract.
|
23.
|
Tax
receipts, insurance premium receipts, ledger sheets, payment
history from
date of origination, insurance claim files, correspondence,
current and
historical computerized data files, and all other processing,
underwriting
and closing papers and records which are customarily contained
in a
mortgage loan file and which are required to document the Mortgage
Loan or
to service the Mortgage Loan.
|
B-3
24.
|
The
original recorded power of attorney, if the Mortgage Note,
the Mortgage,
any assignment of the Mortgage, or any other related document
was executed
by a Person on behalf of the Mortgagor pursuant to a power
of attorney,
with evidence of recording thereon;
|
25.
|
Amortization
schedule, if available; and
|
26.
|
Payment
history for Mortgage Loans that have been closed for more than
90
days.
|
In
the
event an Officer’s Certificate of the Company is delivered to the Custodian
because of a delay caused by the public recording office in returning
any
recorded document, the Company shall deliver to the Custodian, within
60 days of
the related Closing Date, an Officer’s Certificate which shall (i) identify the
recorded document, (ii) state that the recorded document has not been
delivered
to the Custodian due solely to a delay caused by the public recording
office,
(iii) state the amount of time generally required by the applicable recording
office to record and return a document submitted for recordation, and
(iv)
specify the date the applicable recorded document will be delivered to
the
Custodian. The Company shall be required to deliver to the Custodian
the
applicable recorded document by the date specified in (iv) above. An
extension
of the date specified in (iv) above may be requested from the Purchaser,
which
consent shall not be unreasonably withheld.
B-4
EXHIBIT
C
MORTGAGE
LOAN DOCUMENTS
The
Mortgage Loan Documents for each Mortgage Loan shall include each of
the
following items, which shall be delivered to the Custodian pursuant to
Section
2.01 of the Master Seller’s Warranties and Servicing Agreement to which this
Exhibit is annexed (the “Agreement”):
(a) the
original Mortgage Note bearing all intervening endorsements necessary
to show a
complete chain of endorsements from the original payee to the Company,
endorsed
in blank, “Pay to the order of ___________, without recourse” and signed via
original signature in the name of the Company by an authorized officer
and if
previously endorsed, signed in the name of the last endorsee by a duly
qualified
officer of the last endorsee. To the extent that there is no room on
the face of
the Mortgage Note for endorsements, the endorsement may be contained
on an
allonge, if state law so allows. If the Mortgage Loan was acquired by
the
Company in a merger, the endorsement must be by “National City Mortgage Co.,
successor by merger to [name of predecessor].” If the Mortgage Loan was acquired
or originated by the Company while doing business under another name,
the
endorsement must be by “National City Mortgage Co., formerly known as [previous
name]”;
(b) the
original of any guarantee executed in connection with the Mortgage
Note;
(c) the
original Mortgage with evidence of recording thereon, and the original
recorded
power of attorney, if the Mortgage was executed pursuant to a power of
attorney,
with evidence of recording thereon;
(d) the
originals of all assumption, modification, consolidation or extension
agreements, with evidence of recording thereon;
(e) In
the
case of a Mortgage Loan that is not a MERS Mortgage Loan, the original
Assignment of Mortgage for each Mortgage Loan, in form and substance
acceptable
for recording, delivered in blank. If the Mortgage Loan was acquired
by the
Company in a merger, the Assignment of Mortgage must be made by “National City
Mortgage Co., successor by merger to [name of predecessor].” If the Mortgage
Loan was acquired or originated by the Company while doing business under
another name, the Assignment of Mortgage must be by “National City Mortgage Co.,
formerly known as [previous name];”
(f) for
each
Mortgage Loan that is not a MERS Mortgage Loan, the originals of all
intervening
assignments of mortgage with evidence of recording thereon evidencing
a complete
chain of ownership from the originator of the Mortgage Loan to the last
assignee, including warehousing assignments, if any;
(g) for
each
Mortgage Loan that is a MERS Mortgage Loan, the original Mortgage, noting
the
presence of the MIN of the Mortgage Loan and either language indicating
that the
Mortgage Loan is a MOM Loan or if the Mortgage Loan was not a MOM Loan
at
origination, the original Mortgage and the assignment thereof to MERS,
with
evidence of recording indicated thereon, or a copy of the Mortgage certified
by
the public recording office in which such Mortgage has been
recorded;
(h) the
original PMI or LPMI Policy or certificate, if private mortgage guaranty
insurance is required pursuant to the Agreement;
C-1
(i) the
original mortgagee title insurance policy;
(j) the
original of any security agreement, chattel mortgage or equivalent executed
in
connection with the Mortgage; and
(k) such
other documents as the Purchaser may require.
X-0
XXXXXXX
X-0
CUSTODIAL
ACCOUNT CERTIFICATION
_____________________,
200_
National
City Mortgage Co. hereby certifies that it has established the account
described
below as a Custodial Account pursuant to Section 4.04 of the Master Seller’s
Warranties and Servicing Agreement, dated as of January 1, 2005, Conventional
Residential Fixed Rate Mortgage Loans.
Title
of
Account: National
City Mortgage Co. in trust for the Purchaser
Account
Number: _______________
Address
of office or branch
of
the
Company at
which
Account is maintained:
NATIONAL
CITY MORTGAGE CO.
Company
By:
______________________________
Name:
____________________________
Title:
_____________________________
|
X-0-0
XXXXXXX
X-0
CUSTODIAL
ACCOUNT LETTER AGREEMENT
_________________,
200_
To: | ||
(the “Depository”) |
As
Company under the Master Seller’s Warranties and Servicing Agreement, dated as
of January 1, 2005, Conventional Residential Fixed Rate Mortgage Loans
(the
“Agreement”), we hereby authorize and request you to establish an account, as a
Custodial Account pursuant to Section 4.04 of the Agreement, to be designated
as
“National City Mortgage Co., in trust for the Purchaser - Conventional
Residential Fixed Rate and Adjustable Rate Mortgage Loans.” All deposits in the
account shall be subject to withdrawal therefrom by order signed by the
Company.
You may refuse any deposit which would result in violation of the requirement
that the account be fully insured as described below. This letter is submitted
to you in duplicate. Please execute and return one original to us.
NATIONAL
CITY MORTGAGE CO.
Company
By:
______________________________
Name:
____________________________
Title:
_____________________________
Date:
_____________________________
|
D-2-1
The
undersigned, as Depository, hereby certifies that the above described account
has been established under Account Number __________, at the office of
the
Depository indicated above, and agrees to honor withdrawals on such account
as
provided above. The full amount deposited at any time in the account will
be
insured by the Federal Deposit Insurance Corporation through the Bank Insurance
Fund (“BIF”) or the Savings Association Insurance Fund (“SAIF”).
_________________________________
Depository
By:
______________________________
Name:
____________________________
Title:
_____________________________
Date:
_____________________________
|
D-2-2
EXHIBIT
E-1
ESCROW
ACCOUNT CERTIFICATION
__________________,
200_
National
City Mortgage Co. hereby certifies that it has established the account
described
below as an Escrow Account pursuant to Section 4.06 of the Master Seller’s
Warranties and Servicing Agreement, dated as of January 1, 2005, Conventional
Residential Fixed Rate Mortgage Loans.
Title
of
Account: “National
City Mortgage Co. in trust for the Purchaser and various
Mortgagors.”
Account
Number: _______________
Address
of office or branch
of
the
Company at
which
Account is maintained:
NATIONAL
CITY MORTGAGE CO.
Company
By:
______________________________
Name:
____________________________
Title:
_____________________________
|
X-0-0
XXXXXXX
X-0
ESCROW
ACCOUNT LETTER AGREEMENT
___________________,
200_
To: | ||
(the “Depository”) |
As
Company under the Master Seller’s Warranties and Servicing Agreement, dated as
of _________________, Conventional Residential Fixed Rate Mortgage Loans
(the
“Agreement”), we hereby authorize and request you to establish an account, as an
Escrow Account pursuant to Section 4.07 of the Agreement, to be designated
as
“National City Mortgage Co., in trust for the Purchaser - Conventional
Residential Fixed Rate and Adjustable Rate Mortgage Loans.” All deposits in the
account shall be subject to withdrawal therefrom by order signed by the
Company.
You may refuse any deposit which would result in violation of the requirement
that the account be fully insured as described below. This letter is submitted
to you in duplicate. Please execute and return one original to us.
NATIONAL
CITY MORTGAGE CO.
Company
By:
______________________________
Name:
____________________________
Title:
_____________________________
Date:
_____________________________
|
E-1-2
The
undersigned, as Depository, hereby certifies that the above described account
has been established under Account Number ______, at the office of the
Depository indicated above, and agrees to honor withdrawals on such account
as
provided above. The full amount deposited at any time in the account will
be
insured by the Federal Deposit Insurance Corporation through the Bank Insurance
Fund (“BIF”) or the Savings Association Insurance Fund (“SAIF”).
_________________________________
Depository
By:
______________________________
Name:
____________________________
Title:
_____________________________
Date:
_____________________________
|
E-1-3
EXHIBIT
F
MONTHLY
REMITTANCE ADVICE
F-1
EXHIBIT
G
FORM
OF
COMPANY CERTIFICATION PURSUANT TO SECTION 6.04
I,
[identify the certifying individual], certify to ___________________, and
its
affiliates, and in each case, its officers, directors and agents, and with
the
knowledge and intent that they will rely upon this certification,
that:
(i)
|
Based
on my knowledge, the information in the Annual Statement as to
Compliance,
the Annual Independent Public Accountant’s Servicing Report and all
servicing reports, officer’s certificates and other information relating
to the servicing of the Mortgage Loans submitted to the Master
Servicer
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
light of the circumstances under which such statements were made,
not
misleading as of the date of this
certification;
|
(ii)
|
The
servicing information required to be provided to the Master Servicer
by
the Company under the Agreement has been provided to the Master
Servicer;
|
(iii)
|
I
am responsible for reviewing the activities performed by the
Company under
the Agreement and based upon the review required by the Agreement,
and
except as disclosed in the Annual Statement as to Compliance
and the
Annual Independent Public Accountant’s Servicing Report submitted to the
Master Servicer, the Company has, as of the date of this certification
fulfilled its obligations under the Agreement;
and
|
(iv)
|
I
have disclosed to the Master Servicer all significant deficiencies
relating to the Company’s compliance with the minimum servicing standards
in accordance with a review conducted in compliance with the
Uniform
Single Attestation Program for Mortgage Bankers or similar standard
as set
forth in the Agreement.
|
Capitalized
terms used but not defined herein have the meaning ascribed to them in
the
Master Seller’s Warranties and Servicing Agreement dated and effective as of
January 1, 2005, between DB Structured Products, Inc. and National City
Mortgage
Co. (the “Agreement”).
NATIONAL
CITY MORTGAGE CO.
By:______________________
Name:
Title:
Date:
G-1
EXHIBIT
H
UNDERWRITING
GUIDELINES
H-1
EXHIBIT
I
COMPANY’S
OFFICER’S CERTIFICATE
I,
___________________________ hereby certify that I am the duly elected
____________________ of [COMPANY], a ___________________ (the “Company”), and
further certify, on behalf of the Company as follows:
1. Attached
hereto as Attachment I are a true and correct copy of the Certificate of
Incorporation and by-laws of the Company as are in full force and effect
on the
date hereof.
2. No
proceedings looking toward merger, liquidation, dissolution or bankruptcy
of the
Company are pending or contemplated.
3. Each
person who, as an officer or attorney-in-fact of the Company, signed (a)
Master
Seller’s Warranties and Servicing Agreement, dated as of January 1, 2005, by and
between the Company and DB Structured Products, Inc. (the “Purchaser”); (b) the
Trade Confirmation, dated ________, 200_, between the Company and the Purchaser
(the “Trade Confirmation”); and (c) any other document delivered prior hereto or
on the date hereof in connection with the sale and servicing of the Mortgage
Loans in accordance with the Purchase Agreement and the Trade Confirmation
was,
at the respective times of such signing and delivery, and is as of the
date
hereof, duly elected or appointed, qualified and acting as such officer
or
attorney-in-fact, and the signatures of such persons appearing on such
documents
are their genuine signatures.
4. Attached
hereto as Attachment II is a true and correct copy of the resolutions duly
adopted by the board of directors of the Company on ________, 200_ (the
“Resolutions”) with respect to the authorization and approval of the sale and
servicing of the Mortgage Loans; said Resolutions have not been amended,
modified, annulled or revoked and are in full force and effect on the date
hereof.
5. Attached
hereto as Attachment III is a Certificate of Good Standing of the Company
dated
______, 200_. No event has occurred since _______, 200_ which has affected
the
good standing of the Company under the laws of the State of
____________.
6. Attached
hereto as Attachment IV is a copy of each license of the Company to originate
and sell the Mortgage Loans. No such licenses have been suspended or revoked
by
any court, administrative agency, arbitrator or governmental body and no
proceedings are pending which might result in such suspension or
revocation.
7. All
of
the representations and warranties of the Company contained in Section
3.01 and
3.02 of the Purchase Agreement were true and correct in all material respects
as
of the date of the Purchase Agreement and are true and correct in all material
respects as of the date hereof.
I-1
8. The
Company has performed all of its duties and has satisfied all the material
conditions on its part to be performed or satisfied prior to the Closing
Date
pursuant to the Purchase Agreement and the related Trade
Confirmation.
All
capitalized terms used herein and not otherwise defined shall have the
meaning
assigned to them in the Purchase Agreement.
IN
WITNESS WHEREOF,
I have
hereunto signed my name and affixed the seal of the Company.
Dated:
___________________
[Seal]
[COMPANY]
(Company)
By:
_______________________
Name:
_____________________
Title:
Vice
President
|
I,
__________________, Secretary of the Company, hereby certify that
__________________ is the duly elected, qualified and acting Vice President
of
the Company and that the signature appearing above is his genuine
signature.
IN
WITNESS WHEREOF,
I have
hereunto signed my name.
Dated:
___________________
[Seal]
[COMPANY]
(Company)
By:
_______________________
Name:
_____________________
Title:
[Assistant]
Secretary
|
I-2
EXHIBIT
J
[FORM
OF
OPINION OF COUNSEL TO THE COMPANY]
(Date)
[PURCHASER]
Re:
|
Master
Seller’s Warranties and Servicing Agreement,
|
dated
as of January 1, 2005
|
Gentlemen:
I
have
acted as counsel to National City Mortgage Inc., a corporation organized
under
the laws of the State of Ohio (the “Company”), in connection with the sale of
certain loans by the Company to DB Structured Products, Inc. (“the “Purchaser”)
pursuant to (i) an Master Seller’s Warranties and Servicing Agreement, dated as
of January 1, 2005, by and between the Company and the Purchaser (the “Purchase
Agreement”) [and the Trade Confirmation, dated _____,
200_,
between the Company and the Purchaser (the “Trade Confirmation”)]. Capitalized
terms not otherwise defined herein have the meanings set forth in the Purchase
Agreement.
In
connection with rendering this opinion letter, I, or attorneys working
under my
direction have examined, among other things, originals, certified copies
or
copies otherwise identified to my satisfaction as being true copies of
the
following:
A. |
The
Purchase Agreement;
|
B. |
[The
Trade Confirmation;]
|
C.
|
The
Company’s [Certificate of Incorporation and by-laws] [certificate of
limited partnership and limited partnership agreement], as amended
to
date; and
|
D.
|
Resolutions
adopted by the Board of Directors of the Company with specific
reference
to actions relating to the transactions covered by this opinion
(the
“Board Resolutions”).
|
For
the
purpose of rendering this opinion, I have made such documentary, factual
and
legal examinations as I deemed necessary under the circumstances. As to
factual
matters, I have relied upon statements, certificates and other assurances
of
public officials and of officers and other representatives of the Company,
and
upon such other certificates as I deemed appropriate, which factual matters
have
not been independently established or verified by me. I have also assumed,
among
other things, the genuineness of all signatures, the legal capacity of
all
natural persons, the authenticity of all documents submitted to me as originals,
and the conformity to original documents of all documents submitted to
me as
copies and the authenticity of the originals of such copied
documents.
J-1
On
the
basis of and subject to the foregoing examination, and in reliance thereon,
and
subject to the assumptions, qualifications, exceptions and limitations
expressed
herein, I am of the opinion that:
1. The
Company has been duly [incorporated] [formed] and is validly existing and
in
good standing under the laws of the State of Ohio with corporate power
and
authority to own its properties and conduct its business as presently conducted
by it. The Company has the corporate power and authority to service the
Mortgage
Loans, and to execute, deliver, and perform its obligations under the Purchase
Agreement [and the Trade Confirmation] (sometimes collectively, the
“Agreements”).
2. The
Purchase Agreement [and the Trade Confirmation] have been duly and validly
authorized, executed and delivered by the Company.
3. The
Purchase Agreement [and the Trade Confirmation] constitute valid, legal
and
binding obligations of the Company, enforceable against the Company in
accordance with their respective terms.
4. No
consent, approval, authorization or order of any state or federal court
or
government agency or body is required for the execution, delivery and
performance by the Company of the Purchase Agreement [and the Trade
Confirmation], or the consummation of the transactions contemplated by
the
Purchase Agreement [and the Trade Confirmation], except for those consents,
approvals, authorizations or orders which previously have been
obtained.
5. Neither
the servicing of the Mortgage Loans by the Company as provided in the Purchase
Agreement [and the Trade Confirmation,] nor the fulfillment of the terns
of or
the consummation of any other transactions contemplated in the Purchase
Agreement [and the Trade Confirmation] will result in a breach of any term
or
provision of the [certificate of incorporation or by-laws] [certificate
of
limited partnership or limited partnership agreement] of the Company, or,
to the
best of my knowledge, will conflict with, result in a breach or violation
of, or
constitute a default under, (i) the terms of any indenture or other agreement
or
instrument known to me to which the Company is a party or by which it is
bound,
(ii) any State of Ohio or federal statute or regulation applicable to the
Company, or (iii) any order of any State of Ohio or federal court, regulatory
body, administrative agency or governmental body having jurisdiction over
the
Company, except in any such case where the default, breach or violation
would
not have a material adverse effect on the Company or its ability to perform
its
obligations under the Purchase Agreement.
6. There
is
no action, suit, proceeding or investigation pending or, to the best of
my
knowledge, threatened against the Company which, in my judgment, either
in any
one instance or in the aggregate, would draw into question the validity
of the
Purchase Agreement or which would be likely to impair materially the ability
of
the Company to perform under the terms of the Purchase Agreement.
J-2
7. The
sale
of each Mortgage Note and Mortgage as and in the manner contemplated by
the
Purchase Agreement is sufficient fully to transfer to the Purchaser all
right,
title and interest of the Company thereto as noteholder and
mortgagee.
The
opinions above are subject to the following additional assumptions, exceptions,
qualifications and limitations:
A. I
have
assumed that all parties to the Agreements other than the Company have
all
requisite power and authority to execute, deliver and perform their respective
obligations under each of the Agreements, and that the Agreements have
been duly
authorized by all necessary corporate action on the part of such parties,
have
been executed and delivered by such parties and constitute the legal, valid
and
binding obligations of such parties.
B. My
opinion expressed in paragraphs 3 and 7 above is subject to the qualifications
that (i) the enforceability of the Agreements may be limited by the effect
of
laws relating to (1) bankruptcy, reorganization, insolvency, moratorium
or other
similar laws now or hereafter in effect relating to creditors’ rights generally,
including, without limitation, the effect of statutory or other laws regarding
fraudulent conveyances or preferential transfers, and (2) general principles
of
equity upon the specific enforceability of any of the remedies, covenants
or
other provisions of the Agreements and upon the availability of injunctive
relief or other equitable remedies and the application of principles of
equity
(regardless of whether such enforceability is considered in a proceeding
in
equity or at law) as such principles relate to, limit or affect the enforcement
of creditors’ rights generally and the discretion of the court before which any
proceeding for such enforcement may be brought; and (ii) I express no opinion
herein with respect to the validity, legality, binding effect or enforceability
of provisions for indemnification in the Agreements to the extent such
provisions may be held to be unenforceable as contrary to public
policy.
C. I
have
assumed, without independent check or certification, that there are no
agreements or understandings among the Company, the Purchaser and any other
party which would expand, modify or otherwise affect the terms of the documents
described herein or the respective rights or obligations of the parties
thereunder.
I
am
admitted to practice in the State of Ohio and I render no opinion herein
as to
matters involving the laws of any jurisdiction other than the State of
Ohio and
the Federal laws of the United States of America.
Very
truly yours,
J-3
EXHIBIT
K
SECURITY
RELEASE CERTIFICATION
1. Release
of Security Interest
_____________________,
hereby relinquishes any and all right, title and interest it may have in
and to
the Mortgage Loans described in Exhibit
A
attached
hereto upon purchase thereof by DB Structured Products, Inc. from the Company
named below pursuant to that certain Master Seller’s Warranties and Servicing
Agreement, dated as of January 1, 2005, as of the date and time of receipt
by
________ of
$
________ for
such
Mortgage Loans (the “Date and Time of Sale”), and certifies that all notes,
mortgages, assignments and other documents in its possession relating to
such
Mortgage Loans have been delivered and released to the Company named below
or
its designees as of the Date and Time of Sale.
Name
and
Address of Financial Institution
____________________________
(Name)
________________________
(Address)
By:
_________________________
K-1
2. Certification
of Release
The
Company named below hereby certifies to DB Structured Products, Inc. that,
as of
the Date and Time of Sale of the above mentioned Mortgage Loans to DB Structured
Products, Inc., the security interests in the Mortgage Loans released by
the
above named corporation comprise all security interests relating to or
affecting
any and all such Mortgage Loans. The Company warrants that, as of such
time,
there are and will be no other security interests affecting any or all
of such
Mortgage Loans.
Company
By:
___________________________
Name:
_________________________
Title:
__________________________
|
K-2
EXHIBIT
L
ASSIGNMENT
AND CONVEYANCE
On
this
day of
,
200_,
National City Mortgage Co. (“Company”) as the Company under that certain Master
Seller’s Warranties and Servicing Agreement, dated as of January 1, 2005, (the
“Agreement”) does hereby sell, transfer, assign, set over and convey to DB
Structured Products, Inc. as Purchaser under the Agreement, without recourse,
but subject to the terms of the Agreement, all rights, title and interest
of the
Company in and to the Mortgage Loans listed on the Mortgage Loan Schedule
attached hereto, together with the related Mortgage Files and all rights
and
obligations arising under the documents contained therein. Pursuant to
Section
2.03 of the Agreement, the Company has delivered to the Custodian the documents
for each Mortgage Loan to be purchased as set forth in the Custodial Agreement.
The contents of each related Servicing File required to be retained by
the
Company to service the Mortgage Loans pursuant to the Agreement and thus
not
delivered to the Purchaser are and shall be held in trust by the Company
for the
benefit of the Purchaser as the owner thereof. The Company’s possession of any
portion of each such Servicing File is at the will of the Purchaser for
the sole
purpose of facilitating servicing of the related Mortgage Loan pursuant
to the
Agreement, and such retention and possession by the Company shall be in
a
custodial capacity only. The ownership of each Mortgage Note, Mortgage,
and the
contents of the Mortgage File and Servicing File is vested in the Purchaser
and
the ownership of all records and documents with respect to the related
Mortgage
Loan prepared by or which come into the possession of the Company shall
immediately vest in the Purchaser and shall be retained and maintained,
in
trust, by the Company at the will of the Purchaser in such custodial capacity
only.
The
Company confirms to the Purchaser that the representations and warranties
set
forth in Sections 3.01 and 3.02 of the Agreement are true and correct as
of the
date hereof, and that all statements made in the Company’s Officer’s
Certificates and all Attachments thereto remain complete, true and correct
in
all respects as of the date hereof. The Mortgage Loan Schedule attached
hereto
as Attachment
1
is true
and correct as of the date hereof.
Capitalized
terms used herein and not otherwise defined shall have the meanings set
forth in
the Agreement.
NATIONAL
CITY MORTGAGE CO.
(Company)
By:
______________________________
Name:
____________________________
Title:
_____________________________
L-1
AMENDMENT
NUMBER ONE
MASTER
SELLER’S WARRANTIES AND SERVICING AGREEMENT
dated
as
of January 1, 2005
by
and
between
NATIONAL
CITY MORTGAGE CO.
and
DB
STRUCTURED PRODUCTS, INC.
This
AMENDMENT NUMBER ONE is made this 24th day of January, 2006, by and between
NATIONAL CITY MORTGAGE CO., having an address at 0000 Xxxxxxx Xxxxx, Xxxxxxxxxx,
Xxxx 00000 (the “Seller” or “Company”) and DB STRUCTURED PRODUCTS, INC. having
an address at 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the “Purchaser”), to the
Master Seller’s Warranties and Servicing Agreement, dated as of January 1, 2005,
by and between the Purchaser and the Seller (the “Agreement”).
RECITALS
WHEREAS,
the Purchaser and the Seller desire to amend the Agreement, subject to
the terms
hereof, to modify the Agreement as specified herein; and
WHEREAS,
the Purchaser and the Seller each have agreed to execute and deliver this
Amendment Number One on the terms and conditions set forth herein.
NOW
THEREFORE, for good and valuable consideration, the receipt and sufficiency
of
which are hereby acknowledged, and of the mutual covenants herein contained,
the
parties hereto hereby agree as follows:
SECTION
1. Amendment.
Effective as of January 24, 2006, the Agreement is hereby amended as
follows:
(a) Section
1
of the Agreement is hereby amended by adding the following
definitions:
Commission:
The
United States Securities and Exchange Commission.
Company
Information:
As
defined in Section 7A.07(a).
Depositor:
The
depositor, as such term is defined in Regulation AB, with respect to any
Securitization Transaction.
Exchange
Act.
The
Securities Exchange Act of 1934, as amended.
Master
Servicer:
With
respect to any Securitization Transaction, the “master servicer,” if any,
identified in the related transaction documents.
Qualified
Correspondent:
Any
Person from which the Company purchased Mortgage Loans, provided that the
following conditions are satisfied: (i) such Mortgage Loans were originated
pursuant to an agreement between the Company and such Person that contemplated
that such Person would underwrite mortgage loans from time to time, for
sale to
the Company, in accordance with underwriting guidelines designated by the
Company (“Designated Guidelines”) or guidelines that do not vary materially from
such Designated Guidelines; (ii) such Mortgage Loans were in fact underwritten
as described in clause (i) above and were acquired by the Company within
180
days after origination; (iii) either (x) the Designated Guidelines were,
at the
time such Mortgage Loans were originated, used by the Company in origination
of
mortgage loans of the same type as the Mortgage Loans for the Company’s own
account or (y) the Designated Guidelines were, at the time such Mortgage
Loans
were underwritten, designated by the Company on a consistent basis for
use by
lenders in originating mortgage loans to be purchased by the Company; and
(iv)
the Company employed, at the time such Mortgage Loans were acquired by
the
Company, pre-purchase or post-purchase quality assurance procedures (which
may
involve, among other things, review of a sample of mortgage loans purchased
during a particular time period or through particular channels) designed
to
ensure that Persons from which it purchased mortgage loans properly applied
the
underwriting criteria designated by the Company. For the avoidance of doubt,
a
“Qualified Correspondent” includes a “table broker” or mortgage lender that
originates loans underwritten and funded by the Company or an Affiliate
of the
Company.
Reconstitution:
Any
Securitization Transaction or Whole Loan Transfer.
Reconstitution
Agreement:
Any
servicing agreement relating to a Reconstitution.
Regulation
AB:
Subpart
229.1100 - Asset Backed Securities (Regulation AB), 17 C.F.R.
§§229.1100-229.1123, as such may be amended from time to time, and subject
to
such clarification and interpretation as have been provided by the Commission
in
the adopting release (Asset-Backed
Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531
(Jan.
7, 2005)) or by the staff of the Commission, or as may be provided by the
Commission or its staff from time to time.
Responsible
Officer:
Any
vice president, any managing director, any director, any associate, any
assistant vice president, any assistant secretary, any assistant treasurer
or
any other officer or employee of the Company customarily performing functions
similar to those performed by any of the above designated officers and
also to
whom, with respect to a particular matter, such matter is referred because
of
such officer’s or employee’s responsibility, knowledge or familiarity with
respect to the particular subject and in each case who shall have direct
responsibility for the administration of the Agreement.
Securities
Act:
The
Securities Act of 1933, as amended.
Securitization
Transaction.
Any
transaction involving either (1) a sale or other transfer of some or all
of the
Mortgage Loans directly or indirectly to an issuing entity in connection
with an
issuance of publicly offered or privately placed, rated or unrated
mortgage-backed securities or (2) an issuance of publicly offered or privately
placed, rated or unrated securities, the payments on which are determined
primarily by reference to one or more portfolios of residential mortgage
loans
consisting, in whole or in part, of some or all of the Mortgage
Loans.
Servicer:
As
defined in Section 7A.03(c).
Servicing
Criteria:
The
“servicing criteria” set forth in Item 1122(d) of Regulation AB, as such may be
amended from time to time.
Static
Pool Information:
Static
pool information as described in Item 1105(a)(1)-(3) and 1105(c) of Regulation
AB.
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 material functions identified in Item 1122(d) of Regulation AB
with
respect to Mortgage Loans under the direction or authority of the Company
or a
Subservicer.
Subservicer:
Any
Person that services Mortgage Loans on behalf of the Company 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 Company under the Agreement or any
Reconstitution Agreement that are identified in Item 1122(d) of Regulation
AB;
provided, however, that the term “Subservicer” shall not include any master
servicer, or any special servicer engaged at the request of a Depositor,
Purchaser or investor in a Securitization Transaction, nor any “back-up
servicer” or trustee performing servicing functions on behalf of a
Securitization Transaction.
Third-Party
Originator:
Each
Person, other than a Qualified Correspondent, that originated Mortgage
Loans
acquired by the Company and shall not include a mortgage broker that does
not
fund loans.
Whole
Loan Transfer:
Any
sale or transfer of some or all of the Mortgage Loans, other than a
Securitization Transaction.
(b) Section
7.01 of the Agreement is hereby amended by (i) replacing the “.” at the end of
subpart (h) with “; and” and (ii) inserting the following subpart immediately
following subpart
(h):
(i) to
deliver to the Purchaser such information, reports, letters and certifications
as are required pursuant to Article 7A and to indemnify the Purchaser and
its
affiliates as set forth in Article 7A, provided, however, that Article
7A shall
provide the exclusive indemnification with respect to the Company’s obligations
under Article 7A;
(c) Article
7
of the Agreement is hereby amended by inserting the following section at
the end
thereto:
ARTICLE
7A
COMPLIANCE
WITH REGULATION AB
Section
7A.01. Intent
of the Parties.
The
Purchaser and the Company acknowledge and agree that the purpose of Article
7A
of the Agreement is to facilitate compliance by the Purchaser and any Depositor
with the provisions of Regulation AB and related rules and regulations
of the
Commission. Neither the Purchaser 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
provisions of Securities Act, the Exchange Act and the rules and regulations
of
the Commission thereunder that are applicable to any Securitization Transaction.
The Company 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 negotiate
in
good faith with the Purchaser or any Depositor, upon a request made in
good
faith, regarding the Company’s delivery of information under these provisions on
the basis of evolving interpretations of Regulation AB. In connection
with any Securitization Transaction, the Company shall cooperate as set
forth
herein with the Purchaser to deliver to the Purchaser (including any of
its
assignees or designees) and any Depositor, any and all statements, reports,
certifications, records and any other information necessary in the good
faith
determination of the Purchaser or any Depositor to permit the Purchaser
or such
Depositor to comply with the provisions of Regulation AB, together with
such
disclosures relating to the Company, any Subservicer, any Third-Party Originator
and the Mortgage Loans, or the servicing of the Mortgage Loans, reasonably
believed by the Purchaser or any Depositor to be necessary in order to
effect
such compliance. In the event of any conflict between Article 7A and any
other
term or provision in the Agreement, the provisions of Article 7A shall
control.
Section
7A.02. Additional
Representations and Warranties of the Company.
(a) The
Company hereby represents to the Purchaser and to any Depositor, as of
the date
on which information is first provided to the Purchaser or any Depositor
under
Section 7A.03 that, except as disclosed in writing to the Purchaser or
such
Depositor prior to such date and unless otherwise disclosed in such information
provided under Section 7A.03: (i)
the
Company 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 Company; (ii)
the
Company 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 Company as servicer
has been
disclosed or reported by the Company; (iv) no material
changes to the Company’s policies or procedures with respect to the servicing
function it will perform under the 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 scheduled
closing date of the related
Securitization Transaction; (v) there are no aspects of the Company’s financial
condition that could have a material adverse effect on the performance
by
the
Company of its servicing obligations under the Agreement or any Reconstitution
Agreement;
(vi)
there are no material
legal or governmental proceedings pending (or known to be contemplated
by
Government authorities) against the Company or to the knowledge of the
Company,
against any Subservicer or any Third-Party Originator (provided however,
in the
event a governmental or legal proceeding is pending against such Subservicer
or
Third-Party Originator and has been published on an electronic database,
available either by subscription or on a nationally recognized electronic
database acceptable by industry standards as a repository of notice or
information pertaining to governmental or other legal proceedings, the
Company
shall be deemed to have knowledge of such proceeding);
and
(vii) there are no affiliations, relationships or transactions relating
to the
Company, any Subservicer or any Third-Party Originator 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 Purchaser or any Depositor in writing (fax or email) on
any
date following the
date
on which information is first provided to the Purchaser or any Depositor
under
Section 7A.03,
the
Company shall, as soon as practicable following such request in writing
(but in
no event later that 10 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
7A.03. Information
to Be Provided by the Company.
In
connection with any Securitization Transaction the Company shall (i)
as
soon
as practicable following a request by
the
Purchaser or any Depositor in writing (fax or email)
(but in
no event later that 10 days following such request),
provide
to the Purchaser and such Depositor (or, as applicable, cause each Third-Party
Originator and each Subservicer to provide), in writing, or in a mutually
agreed
upon electronic format, and in form and substance reasonably satisfactory
to the
Purchaser and such Depositor, the information and materials specified in
paragraphs (a), (b), (c) and (g) of this Section, and (ii) as promptly
as
practicable following notice to or discovery by the Company, provide to
the
Purchaser and any Depositor (in writing, or in a mutually agreed upon electronic
format, and in form and substance reasonably satisfactory to the Purchaser
and
such Depositor) the information specified in paragraph (d) of this
Section.
(a) If
so
requested by the Purchaser or any Depositor,the Company shall provide (or
cause
each Third-Party Originator or Subservicer, as applicable, to provide)
such
information, as mutually agreed upon by the Purchaser or any Depositor
and the
Company (or such Third-Party Originator or Subservicer, as applicable),
regarding (i) the Company, as originator of the Mortgage Loans (including
as an
acquirer of Mortgage Loans from a Qualified Correspondent), or (ii) each
Third-Party Originator, and (iii) as applicable, each Subservicer, as is
requested for the purpose of compliance with Items 1103(a)(1), 1105, 1110,
1117
and 1119 of Regulation AB. Such information shall include, at a
minimum:
(A) the
originator’s form of organization;
(B) a
description of the originator’s origination program and how long the originator
has been engaged in originating residential mortgage loans, which description
shall include a discussion of the originator’s experience in originating
mortgage loans of a similar type as the Mortgage Loans; information regarding
the size and composition of the originator’s origination portfolio; and
information that may be material, as mutually agreed upon in good faith
by the
Purchaser or any Depositor and the Company, to an analysis of the performance
of
the Mortgage Loans, including the originators’ credit-granting or underwriting
criteria for mortgage loans of similar type(s) as the Mortgage Loans and
such
other information as the Purchaser or any Depositor may reasonably request
for
the purpose of compliance with Item 1110(b)(2) of Regulation AB;
(C) a
description of any material legal or governmental proceedings pending (or
known
to be contemplated by governmental authorities) against the Company, or
to the
knowledge of the Company, each Third-Party Originator and each Subservicer
Originator (provided however, in the event a governmental or legal proceeding
is
pending against such Third-Party Originator or Subservicer and has been
published on an electronic database, available either by subscription or
on a
nationally recognized electronic database acceptable by industry standards
as a
repository of notice or information pertaining to governmental or other
legal
proceedings, the Company shall be deemed to have knowledge of such proceeding);
and
(D) a
description of any affiliation or relationship between the Company, each
Third-Party Originator, each Subservicer and any of the following parties
to a
Securitization Transaction, as such parties are identified to the Company
by the
Purchaser 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) If
so
requested by the Purchaser or any Depositor, the Company shall provide
(or, as
applicable, cause each Third-Party Originator to provide) Static Pool
Information with respect to the mortgage loans (of a similar type as the
Mortgage Loans, as reasonably identified by the Purchaser as provided below)
originated by (i) the Company, if the Company is an originator of Mortgage
Loans
(including as an acquirer of Mortgage Loans from a Qualified Correspondent),
and/or (ii) each Third-Party Originator. Such Static Pool Information shall
be
prepared by the Company (or Third-Party Originator) on the basis of its
reasonable, good faith interpretation of the requirements of Item 1105(a)(1)-(3)
of Regulation AB. To the extent that there is reasonably available to the
Company (or Third-Party Originator) Static Pool Information with respect
to more
than one mortgage loan type, the Purchaser or any Depositor shall be entitled
to
specify whether some or all of such information shall be provided pursuant
to
this paragraph. The content of such Static Pool Information may be in the
form
customarily provided by the Company, and need not be customized for the
Purchaser or any Depositor. Such Static Pool Information for each vintage
origination year or prior securitized pool, as applicable, shall be presented
in
increments no less frequently than quarterly over the life of the mortgage
loans
included in the vintage origination year or prior securitized pool. The
most
recent periodic increment must be as of a date no later than 135 days prior
to
the date of the prospectus or other offering document in which the Static
Pool
Information is to be included or incorporated by reference. The Static
Pool
Information shall be provided in an electronic format that provides a permanent
record of the information provided, such as a portable document format
(.pdf)
file, or other such electronic format as mutually agreed upon in good faith
by
the Purchaser or the Depositor and the Company, as applicable.
If
so
requested by the Purchaser or any Depositor, the Company shall provide
(or, as
applicable, cause each Third-Party Originator to provide), at the expense
of the
Purchaser or Depositor, as applicable (to the extent of any additional
incremental expense associated with delivery pursuant to the Agreement),
such
statements and agreed-upon procedures letters of certified public accountants
reasonably acceptable to the Purchaser or Depositor, as applicable, pertaining
to Static Pool Information relating to prior securitized pools for
securitizations closed on or after January 1, 2006 or, in the case of Static
Pool Information with respect to the Company’s or Third-Party Originator’s
originations or purchases, to calendar months commencing January 1,
2006,
as the
Purchaser or such Depositor shall reasonably request. Such statements and
letters shall be addressed to and be for the benefit of such parties as
the
Purchaser or such Depositor shall designate, which may include, by way
of
example, any Sponsor, any Depositor and any broker dealer acting as underwriter,
placement agent or initial purchaser with respect to a Securitization
Transaction, and shall also be addressed to and for the benefit of the
Company
and such Third-Party Originator; provided, however, that the procedures
and work
to be performed by such certified public accountants shall not create an
undue
disruption or burden on the business operations to the Company. Any such
statement or letter may take the form of a standard, generally applicable
document accompanied by a reliance letter authorizing reliance by the addressees
designated by the Purchaser or such Depositor.
(c) If
so
requested by the Purchaser or any Depositor, the Company shall provide
such
information regarding the Company, as servicer of the Mortgage Loans, and
cause
each Subservicer to so provide such information (each of the Company and
each
Subservicer, for purposes of this paragraph, a “Servicer”), as is requested for
the purpose of compliance with Item 1108 of Regulation AB. Such information
shall include, at a minimum:
(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 the 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 mutual judgment of the Company
and the
Purchaser or any Depositor, to any analysis of the servicing of the Mortgage
Loans or the related asset-backed securities, as applicable, including,
without
limitation:
(1) 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 scheduled closing date of the related
Securitization Transaction;
(2) the
extent of outsourcing the Servicer utilizes;
(3) 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 scheduled closing date of the related Securitization
Transaction;
(4) 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
(5) such
other information as the Purchaser 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 scheduled closing date of the related Securitization Transaction
to the Servicer’s policies or procedures with respect to the servicing function
it will perform under the 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 the effect on one or more aspects of servicing resulting
from
such financial conditions would likely have a material impact on pool
performance or the performance by the Company of its servicing obligations
under
the 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 scheduled closing date of 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;
(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.
(d) If
so
requested by the Purchaser or any Depositor for the purpose of satisfying
its
reporting obligation under the Exchange Act with respect to any class of
asset-backed securities, the Company shall upon discovery (or shall cause
each
Subservicer and Third-Party Originator to so notify upon discovery) (i)
notify
the Purchaser and any Depositor in writing of (A) any material litigation
or
governmental proceedings pending against the Company, any Subservicer or
any
Third-Party Originator, as applicable, and (B) any affiliations or relationships
that develop following the closing date of a Securitization Transaction
between
the Company, any Subservicer or any Third-Party Originator and any of the
parties specified in clause (D) of paragraph (a) of this Section (and any
other
parties identified in writing by the requesting party) with respect to
such
Securitization Transaction, and (ii) provide to the Purchaser and any Depositor
a description of such proceedings, affiliations or relationships.
(e) As
a
condition to the succession to the Company or any Subservicer as servicer
or
subservicer under the Agreement or any Reconstitution Agreement by any
Person
(i) into which the Company or such Subservicer may be merged or consolidated,
or
(ii) which may be appointed as a successor to the Company or any Subservicer,
the Company shall provide to the Purchaser and any Depositor, at least
5
Business Days prior to the effective date of such succession or appointment,
(x)
written notice to the Purchaser and any Depositor of such succession or
appointment and (y) in writing and in form and substance reasonably satisfactory
to the Purchaser and such Depositor, all information reasonably requested
by the
Purchaser or any Depositor in order to comply with its reporting obligation
under Item 6.02 of Form 8-K with respect to the related Securitization
Transaction.
(f) In
addition to such information as the Company, as servicer, is obligated
to
provide pursuant to other provisions of the Agreement, if so requested
by the
Purchaser or any Depositor, the Company shall provide such information
regarding
the performance or servicing of the Mortgage Loans as is reasonably required
to
facilitate preparation of distribution reports in accordance with Item
1121 of
Regulation AB. Such information shall be provided concurrently with the
monthly
reports otherwise required to be delivered by the servicer under the Agreement,
commencing with the first such report due not less than ten (10) Business
Days
following such request.
Section
7A.04. Servicer
Compliance Statement.
On
or
before March 1 of each calendar year, commencing in 2007, the Company shall
deliver to the Purchaser and any Depositor a statement of compliance addressed
to the Purchaser and such Depositor and signed by an authorized officer
of the
Company, to the effect that (i) a review of the Company’s activities as servicer
during the immediately preceding calendar year (or applicable portion thereof)
and of its performance under the 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 Company
has fulfilled all of its obligations under the 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.
Section
7A.05. Report
on Assessment of Compliance and Attestation.
(a) On
or
before March 1 of each calendar year, commencing in 2007, the Company
shall:
(i) deliver
to the Purchaser, any Master Servicer and any Depositor a report (in form
and
substance reasonably satisfactory to the Purchaser and such Depositor)
regarding
the Company’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 Purchaser, such Master Servicer and such Depositor and
signed
by an authorized officer of the Company, and shall address each of the
Servicing
Criteria specified on a certification substantially in the form of Exhibit
N
hereto delivered to the Purchaser concurrently with execution of the
Agreement;
(ii) deliver
to the Purchaser and any Depositor a report of a registered public accounting
firm reasonably acceptable to the Purchaser and such Depositor that attests
to,
and reports on, the assessment of compliance made by the Company 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 Company pursuant
to
Section 7A.06(b) to be “participating in the servicing function” within the
meaning of Item 1122 of Regulation AB, to deliver to the Purchaser and
any
Depositor an assessment of compliance and accountants’ attestation as and when
provided in paragraphs (a) and (b) of this Section; and
(iv) deliver
to the Purchaser, any 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, signed by the appropriate
officer
of the Company, in the form attached hereto as Exhibit M provided that
such
certification delivered by the Company may not be filed as an exhibit to,
or
included in, any offering document or registration statement .
The
Company acknowledges that the parties identified in clause (a)(iv) above
may
rely on the certification provided by the Company pursuant to such clause
in
signing a Sarbanes Certification and filing such with the
Commission.
(b) Each
assessment of compliance provided by a Subservicer pursuant to Section
7A.05(a)(i) shall address each of the Servicing Criteria specified on a
certification substantially in the form of Exhibit N hereto delivered to
the
Purchaser concurrently with the execution of the 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 7A.05(a)(iii) need not address any elements of the Servicing Criteria
other than those specified by the Company pursuant to Section
7A.06.
Section
7A.06. Use
of
Subservicers and Subcontractors.
The
Company shall not hire or otherwise utilize the services of any Subservicer
to
fulfill any of the obligations of the Company as servicer under the Agreement
or
any Reconstitution Agreement unless the Company complies with the provisions
of
paragraph (a) of this Section. The Company 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 Company as servicer under the Agreement or any Reconstitution
Agreement unless the Company complies with the provisions of paragraph
(b) of
this Section.
(a) It
shall
not be necessary for the Company to seek the consent of the Purchaser or
any
Depositor to the utilization of any Subservicer. The Company shall cause
any
Subservicer used by the Company (or by any Subservicer) for the benefit
of the
Purchaser and any Depositor to comply with the provisions of this Section
and
with Sections 7A.02, 7A.03(c) and (e), 7A.04, 7A.05 and 7.07 of the Agreement
to
the same extent as if such Subservicer were the Company, and to provide
the
information required with respect to such Subservicer under Section 7A.03(d)
of
the Agreement. The Company shall be responsible for obtaining from each
Subservicer and delivering to the Purchaser and any Depositor any servicer
compliance statement required to be delivered by such Subservicer under
Section
7A.04, any assessment of compliance and attestation required to be delivered
by
such Subservicer under Section 7A.05 and any certification required to
be
delivered to the Person that will be responsible for signing the Sarbanes
Certification under Section 7A.05 as and when required to be
delivered.
(b) It
shall
not be necessary for the Company to seek the consent of the Purchaser or
any
Depositor to the utilization of any Subcontractor. The Company shall promptly
upon request provide to the Purchaser and any Depositor (or any designee
of the
Depositor, such as an administrator) a written description (in form and
substance satisfactory to the Purchaser and such Depositor) of the role
and
function of each Subcontractor utilized by the Company 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.
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 Company shall cause any such Subcontractor used by the
Company (or by any Subservicer) for the benefit of the Purchaser and any
Depositor to comply with the provisions of Sections 7.A05 and 7.A07 of
the
Agreement to the same extent as if such Subcontractor were the Company.
The
Company shall be responsible for obtaining from each Subcontractor and
delivering to the Purchaser and any Depositor any assessment of compliance
and
attestation required to be delivered by such Subcontractor under Section
7A.05,
in each case as and when required to be delivered.
Section
7A.07. Indemnification;
Remedies.
(a) The
Company
shall
indemnify the Purchaser, each affiliate of the Purchaser, and each of the
following parties participating
in a Securitization Transaction: each
sponsor and issuing entity; 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; 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 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 7A
by or on
behalf of the Company,
or provided under this Article 7A by or on behalf of any Subservicer,
Subcontractor or Third-Party Originator (collectively, the “Company
Information”),
or (B)
the omission or alleged omission to state in the Company Information a
material
fact required to be stated in the Company Information or necessary in order
to
make the statements therein, in the light of the circumstances under which
they
were provided, not misleading; provided,
by way of clarification,
that
clause (B) of this paragraph shall be construed solely by reference to
the
Company Information and not to any other information communicated in connection
with a sale or purchase of securities, without regard to whether the Company
Information or any portion thereof is presented together with or separately
from
such other information;
(ii) any
failure by the Company, any Subservicer, any Subcontractor or any Third-Party
Originator to deliver any information, report, certification, accountants’
letter or other material when and as required under this Article 7A, including
any failure by the Company to identify pursuant to Section 7A.06(b) any
Subcontractor “participating in the servicing function” within the meaning of
Item 1122 of Regulation AB; or
(iii) any
breach by the Company of a representation or warranty set forth in Section
7A.02(a) or in a writing furnished pursuant to Section 7A.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
Company of a representation or warranty in a writing furnished pursuant
to
Section 7A.02(b) to the extent made as of a date subsequent to such closing
date; or
In
the
case of any failure of performance described in clause (a)(ii) of this
Section,
the Company shall promptly reimburse the Purchaser, 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 Company, any
Subservicer, any Subcontractor or any Third-Party
Originator.
(b) Notification
and Cooperation.
The
parties hereto further agree, and any Indemnified Party not a party hereto
is
deemed to agree, as a condition to its reliance on such indemnification,
that
the Company’s indemnification obligations under this Section 7A.07 are subject
to the following terms and conditions:
(i) An
Indemnified Party seeking indemnification hereunder shall give written
notice to
the Company within a reasonable time after the Indemnified Party receives
notice
or becomes aware of an indemnifiable claim;
(ii) The
Company shall
undertake the defense of the action or claim with counsel or other
representatives of its own choosing and reasonably acceptable to the Indemnified
Party (which counsel shall not, except with the consent of the Indemnified
Party, be counsel to the Indemnifying Party);
(iii) The
Indemnified Party shall have the right to participate and assist in, but
not
control, the defense of such claim and employ separate counsel in any action
or
claim at the expense of the Indemnified Party (i.e., at its own expense);
and
(iv) The
Company shall not settle or compromise any claim suit or action against
the
Indemnified Party without the express prior written consent of the Indemnified
Party.
(c) Exclusive
Remedy.
Except
for remedies under the Agreement and remedies that cannot be waived as
a matter
of law and injunctive relief, the rights under this Section 7A.07 shall
be the
exclusive remedy for breaches of this Section 7A.07 (including any covenant,
obligation, representation or warranty contained herein or
therein).
(d) Limitations.
Notwithstanding anything in the Agreement to the contrary, in no event
shall the
Company be obligated under this Section 7A.07 to indemnify an Indemnified
Party
otherwise entitled to indemnity hereunder in respect of any indemnifiable
claims
or losses that result from the willful misconduct, bad faith or negligence
of
the Indemnified Party.
(e) Responsible
Officers.
Except
as
otherwise set forth in Article 7A, any reference in Article 7A to the Company’s
knowledge, discovery or awareness, or notice or identification to the Company,
or a request to the Company, shall be in each case be deemed to refer solely
to
the knowledge or awareness of, or notice or identification to, or request
of, a
Responsible Officer of the Company.
(d) The
Agreement is hereby amended by inserting Exhibit M in the form of Annex
A
attached
hereto at the end thereto.
(e) The
Agreement is hereby amended by inserting Exhibit N in the form of Annex
B
attached
hereto at the end thereto.
SECTION
2. Defined
Terms.
Any
terms capitalized but not otherwise defined herein shall have the respective
meanings set forth in the Agreement.
SECTION
3. Limited
Effect.
Except
as amended hereby, the Agreement shall continue in full force and effect
in
accordance with its terms. Reference to this Amendment need not be made
in the
Agreement or any other instrument or document executed in connection therewith,
or in any certificate, letter or communication issued or made pursuant
to, or
with respect to, the Agreement, any reference in any of such items to the
Agreement being sufficient to refer to the Agreement as amended hereby.
This
Amendment Number One shall apply to all Mortgage Loans subject to the Agreement
notwithstanding that any such Mortgage Loans were purchased prior to the
date of
this Amendment Number One, provided however, that this Amendment Number
One
shall not apply unless those Mortgage Loans are subject to a Reconstitution
Agreement that occurs on or after January 1, 2006.
SECTION
4. Governing
Law.
This
Amendment Number One shall be construed in accordance with the laws of
the State
of New York and the obligations, rights, and remedies of the parties hereunder
shall be determined in accordance with such laws without regard to conflict
of
laws doctrine applied in such state (other than Section 5-1401 or 5-1402
of the
New York General Obligations Law).
SECTION
5. Counterparts.
This
Amendment Number One may be executed by each of the parties hereto on any
number
of separate counterparts, each of which shall be an original and all of
which
taken together shall constitute one and the same instrument.
[SIGNATURE
PAGE TO FOLLOW]
IN
WITNESS WHEREOF, the Seller and the Purchaser have caused this Amendment
Number
One to be executed and delivered by their duly authorized officers as of
the day
and year first above written.
NATIONAL
CITY MORTGAGE CO.
(Seller)
By:___________________________
Name:_________________________
Title:__________________________
DB
STRUCTURED PRODUCTS, INC.
(Purchaser)
By:___________________________
Name:_________________________
Title:__________________________
By:___________________________
Name:_________________________
Title:__________________________
|
ANNEX
A
EXHIBIT
M
FORM
OF
ANNUAL CERTIFICATION
Re:
|
The
Master Seller’s Warranties and Servicing Agreement dated as of January 1,
2005 (the “Agreement”), among DB Structured Products, Inc. and National
City Mortgage Co.
|
I,
________________________________, the _______________________ of National
City
Mortgage Co., certify to [the Purchaser], [the Depositor], and the [Master
Servicer] [Securities Administrator] [Trustee], and their officers, with
the
knowledge and intent that they will rely upon this certification,
that:
(1) I
have
reviewed the servicer compliance statement of the Company provided in accordance
with Item 1123 of Regulation AB (the “Compliance Statement”), the report on
assessment of the Company’s compliance with the applicable 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 servicing reports, officer’s certificates and other
information relating to the servicing of the Mortgage Loans by the Company
during 200[_] that were delivered by the Company to the [Depositor] [Master
Servicer] [Securities Administrator] [Trustee] pursuant to the Agreement
(collectively, the “Company Servicing Information”);
(2) Based
on
my knowledge, the Company 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 provided, not misleading with respect to the
period
of time covered by the Company Servicing Information;
(3) Based
on
my knowledge, all of the Company Servicing Information required to be provided
by the Company under the Agreement has been provided to the [Depositor]
[Master
Servicer] [Securities Administrator] [Trustee];
(4) I
am
responsible for reviewing the activities performed by the Company 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
Company has fulfilled its obligations under the Agreement; and
(5) The
Compliance Statement required to be delivered by the Company pursuant to
the
Agreement, and the Servicing Assessment and Attestation Report required
to be
provided by the Company and by each Subcontractor “participating in the
servicing function” pursuant to the Agreement, have been provided to the
[Depositor] [Master Servicer]. To the extent undertaken or performed by
the
Company, the Servicing Assessment and the Attestation Report cover all
items of
the servicing criteria identified on Exhibit [N] to the Agreement as applicable
to the Company. 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
Date: ______________________________
By:
_____________________________
Name:
Title:
|
ANNEX
B
EXHIBIT
N
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The
assessment of compliance to be delivered by [the Company] [Name of 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
|
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 (A) are mathematically accurate;
(B) were
prepared within 30 calendar days after the bank statement cutoff
date, or
such other number of days specified in the transaction agreements;
(C)
were 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
|
Servicing
Criteria
|
Applicable
Servicing Criteria
|
|
Reference
|
Criteria
|
|
Investor
Remittances and Reporting
|
|
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.
|
|
1122(d)(4)(ii)
|
Mortgage
loan and related documents are safeguarded as required by the
transaction
agreements
|
|
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.
|
|
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
|
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.
|
[X]
|
|
|
|
ATTACHMENT
3
EXHIBIT
F
Standard
File Layout - Master Servicing
|
||||
Column
Name
|
Description
|
Decimal
|
Format
Comment
|
Max
Size
|
SER_INVESTOR_NBR
|
A
value assigned by the Servicer to define a group of loans.
|
|
Text
up to 10 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
|
BORROWER_NAME
|
The
borrower name as received in the file. It is not separated by first
and
last name.
|
|
Maximum
length of 30 (Last, First)
|
30
|
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 ($)
|
11
|
SERV_CURT_AMT_3
|
The
third curtailment amount to be applied.
|
2
|
No
commas(,) or dollar signs ($)
|
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
|
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
|
|
|
|
|
|
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
|
Exhibit
: Standard
File Layout - Delinquency Reporting
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 ($)
|
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
: 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.
1.
2. 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.
|
3. |
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 ( ).
|
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.
4.
|
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.
|
5. |
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
|
[____________________]
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
|
ATTACHMENT
4
EXHIBIT
N
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The
assessment of compliance to be delivered by [the Company] [Name of 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
|
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 (A) are mathematically accurate;
(B) were
prepared within 30 calendar days after the bank statement cutoff
date, or
such other number of days specified in the transaction agreements;
(C)
were 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
|
Servicing
Criteria
|
Applicable
Servicing Criteria
|
|
Reference
|
Criteria
|
|
Investor
Remittances and Reporting
|
|
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
|
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
|
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.
|
|
|
|
|