CITIGROUP GLOBAL MARKETS REALTY CORP. Purchaser and NATIONAL CITY MORTGAGE CO., Company
CITIGROUP
GLOBAL MARKETS REALTY CORP.
Purchaser
and
NATIONAL
CITY MORTGAGE CO.,
Company
_________________________________________________________
AMENDED
AND RESTATED MASTER SELLER’S
WARRANTIES AND SERVICING AGREEMENT
WARRANTIES AND SERVICING AGREEMENT
Dated
as
of
September
1, 2003,
as
amended and restated to and including May 1, 2005
_________________________________________________________
Conventional
Mortgage Loans
|
TABLE
OF CONTENTS
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ARTICLE
I
DEFINITIONS
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ARTICLE
II
CONVEYANCE
OF MORTGAGE LOANS; POSSESSION OF MORTGAGE FILES; BOOKS AND RECORDS;
DELIVERY OF DOCUMENTS
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|
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Section
2.01
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Conveyance
of Mortgage Loans; Possession of Mortgage Files; Maintenance
of Servicing
Files.
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Section
2.02
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Purchase
Price.
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Section
2.03
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Books
and Records; Transfers of Mortgage Loans.
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Section
2.04
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Delivery
of Documents
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Section
2.05
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Closing
Documents.
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ARTICLE
III
REPRESENTATIONS
AND WARRANTIES; REMEDIES AND BREACH
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Section
3.01
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Company
Representations and Warranties.
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Section
3.02
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Representations
and Warranties Regarding Individual Mortgage Loans.
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Section
3.03
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Remedies
for Breach of Representations and Warranties.
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Section
3.04
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Review
of Mortgage Loans.
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Section
3.05
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Repurchase
of convertible Mortgage Loans
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ARTICLE
IV
ADMINISTRATION
AND SERVICING OF MORTGAGE LOANS
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Section
4.01
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Company
to Act as Servicer.
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Section
4.02
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Liquidation
of Mortgage Loans.
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Section
4.03
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Collection
of Mortgage Loan Payments.
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Section
4.04
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Establishment
of and Deposits to Custodial Account.
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Section
4.05
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Permitted
Withdrawals From Custodial Account.
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Section
4.06
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Establishment
of and Deposits to Escrow Account.
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Section
4.07
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Permitted
Withdrawals From Escrow Account.
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Section
4.08
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Payment
of Taxes, Insurance and Other Charges.
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Section
4.09
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Protection
of Accounts.
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Section
4.10
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Maintenance
of Hazard Insurance.
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Section
4.11
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Maintenance
of Mortgage Impairment Insurance.
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Section
4.12
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Maintenance
of Fidelity Bond and Errors and Omissions Insurance.
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Section
4.13
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Inspections.
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Section
4.14
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Restoration
of Mortgaged Property.
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Section
4.15
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Maintenance
of PMI and LPMI Policy; Claims.
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Section
4.16
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Title,
Management and Disposition of REO Property.
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Section
4.17
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Real
Estate Owned Reports.
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Section
4.18
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Liquidation
Reports.
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Section
4.19
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Reports
of Foreclosures and Abandonments of Mortgaged Property.
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Section
4.20
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Notification
of Adjustments
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Section
4.21
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Compliance
with REMIC Provisions
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ARTICLE
V
PAYMENTS
TO PURCHASER
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Section
5.01
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Remittances.
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Section
5.02
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Statements
to Purchaser.
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Section
5.03
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Monthly
Advances by Company.
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ARTICLE
VI
GENERAL
SERVICING PROCEDURES
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Section
6.01
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Transfers
of Mortgaged Property.
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Section
6.02
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Satisfaction
of Mortgages and Release of Mortgage Files.
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Section
6.03
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Servicing
Compensation.
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Section
6.04
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Annual
Statement as to Compliance.
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Section
6.05
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Annual
Independent Public Accountants’ Servicing Report.
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Section
6.06
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Right
to Examine Company Records.
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ARTICLE
VII
AGENCY
TRANSFER; PASS-THROUGH TRANSFER
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Section
7.01
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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.
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Section
7.02
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Purchaser’s
Repurchase and Indemnification Obligations.
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ARTICLE
VIII
COMPANY
TO COOPERATE
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Section
8.01
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Provision
of Information.
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Section
8.02
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Financial
Statements; Servicing Facility.
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ARTICLE
IX
THE
COMPANY
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Section
9.01
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Indemnification;
Third Party Claims.
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Section
9.02
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Merger
or Consolidation of the Company.
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Section
9.03
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Limitation
on Liability of Company and Others.
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Section
9.04
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Limitation
on Resignation and Assignment by Company.
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ARTICLE
X
DEFAULT
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Section
10.01
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Events
of Default.
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Section
10.02
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Waiver
of Defaults.
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ARTICLE
XI
TERMINATION
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Section
11.01
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Termination.
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Section
11.02
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Termination
Without Cause.
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ARTICLE
XII
MISCELLANEOUS
PROVISIONS
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Section
12.01
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Successor
to Company.
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Section
12.02
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Amendment.
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Section
12.03
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Governing
Law.
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Section
12.04
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Duration
of Agreement.
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Section
12.05
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Notices.
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Section
12.06
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Severability
of Provisions.
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Section
12.07
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Relationship
of Parties.
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Section
12.08
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Execution;
Successors and Assigns.
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Section
12.09
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Recordation
of Assignments of Mortgage.
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Section
12.10
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Assignment
by Purchaser.
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Section
12.11
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No
Personal Solicitation.
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Section
12.16
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Entire
Agreement.
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EXHIBITS
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EXHIBIT
A
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MORTGAGE
LOAN SCHEDULE
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EXHIBIT
B
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CONTENTS
OF EACH MORTGAGE
FILE
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EXHIBIT
C
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MORTGAGE
LOAN DOCUMENTS
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EXHIBIT
D-1
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FORM
OF CUSTODIAL ACCOUNT CERTIFICATION
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EXHIBIT
D-2
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FORM
OF CUSTODIAL ACCOUNT LETTER
AGREEMENT
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EXHIBIT
E-1
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FORM
OF ESCROW ACCOUNT CERTIFICATION
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EXHIBIT
E-2
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FORM
OF ESCROW ACCOUNT LETTER AGREEMENT
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EXHIBIT
F
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FORM
OF MONTHLY REMITTANCE ADVICE
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EXHIBIT
G
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RESERVED
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EXHIBIT
H
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UNDERWRITING
GUIDELINES
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EXHIBIT
I
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COMPANY’S
OFFICER’S CERTIFICATE
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EXHIBIT
J
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FORM
OF OPINION OF COUNSEL TO THE
COMPANY
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EXHIBIT
K
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SECURITY
RELEASE CERTIFICATION
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EXHIBIT
L
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ASSIGNMENT
AND CONVEYANCE
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This
is
an Amended and Restated Master Seller’s Warranties and Servicing Agreement for
conventional fixed rate and adjustable rate residential first lien mortgage
loans, dated and effective as of September 1, 2003, as amended and restated
to
and including May 1, 2005 and is executed between Citigroup Global Markets
Realty Corp. as purchaser (the “Purchaser”),
and
National City Mortgage Co., as seller and servicer (the “Company”).
W I T N E S S E T H:
WHEREAS,
the Purchaser may agree to purchase, from time to time, from the Company and
the
Company desires to sell, from time to time, to the Purchaser 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.
Adjustment
Date:
With
respect to any Mortgage Loan, the date set forth in the related Mortgage Note
on
which the Mortgage Interest Rate on the Mortgage Loan is adjusted in accordance
with the terms of the Mortgagee Note.
Agency
Transfer:
The
sale or transfer by Purchaser of some or all of the Mortgage Loans to ▇▇▇▇▇▇
▇▇▇
under its Cash Purchase Program or its MBS Swap Program (Special Servicing
Option) or to ▇▇▇▇▇▇▇ Mac under its ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ Program or Gold PC Program,
retaining the Company as “servicer thereunder”.
Agreement:
This
Amended and Restated 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:
The
value set forth in an appraisal made in connection with the origination of
the
related Mortgage Loan as the value of the Mortgaged Property.
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.
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.
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.
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.
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 Mortgagee to a fixed Mortgage Interest Rate.
Condemnation
Proceeds:
All
awards or settlements in respect of a Mortgaged Property, whether permanent
or
temporary, partial or entire, by exercise of the power of eminent domain or
condemnation, to the extent not required to be released to a Mortgagor in
accordance with the terms of the related Mortgage Loan Documents.
Custodial
Account:
The
separate account or accounts created and maintained pursuant to Section
4.04.
Custodial
Agreement:
That
certain Custodial Agreement, dated as of June 24, 2002, by and between the
Purchaser and Salomon Brothers Realty Corp.
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.
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 ▇▇▇▇▇’▇ Investors Service, Inc) and the
long-term debt obligations of such depository institution or trust company
(or,
in the case of a depository institution or trust company which is the principal
subsidiary of a holding company, the long-term debt obligations of such holding
company) are rated at least “Aa” by ▇▇▇▇▇’▇ Investors Service,
Inc.;
provided,
however, that no such instrument shall be an Eligible Investment if such
instrument evidences either (i) a right to receive only interest payments
with respect to the obligations underlying such instrument, or (ii) both
principal and interest payments derived from obligations underlying such
instrument and the principal and interest payments with respect to such
instrument provide a yield to maturity of greater than 120% of the yield to
maturity at par of such underlying obligations.
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 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.
▇▇▇▇▇▇
▇▇▇:
▇▇▇▇▇▇
▇▇▇ (formerly known as the Federal National Mortgage Association), or any
successor thereto.
▇▇▇▇▇▇
Mae Guides:
The
▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇’ Guide and the ▇▇▇▇▇▇ 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:
May 18,
2005.
▇▇▇▇▇▇▇
Mac:
▇▇▇▇▇▇▇
Mac (formerly known as The Federal Home Loan Mortgage Corporation), or any
successor thereto.
Gross
Margin:
With
respect to any 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.
Index:
With
respect to any 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 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 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 Mortgage Loan may increase or decrease during the term
thereof from the Mortgage Interest Rate in effect on the date of origination
of
such 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.
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), 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 another 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 in an
amount as is set forth in the related Trade Confirmation and related Mortgage
Loan Schedule.
Maximum
Mortgage Interest Rate:
With
respect to each 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 Mortgage Loan may be increased
on
any Adjustment Date.
Minimum
Mortgage Interest Rate:
With
respect to each 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 Mortgage Loan may be decreased
on
any Adjustment Date.
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.
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 or leasehold
estate in real property securing the Mortgage Note.
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-1
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.
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 Loan to Value Ratio 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 next actual Due Date of the Mortgage Loan; (26) a twelve month history
for the Mortgage Loan and the number of times thirty, sixty, and ninety days
delinquent in the past twelve months; (27) a code indicating the payment status
of the Mortgage Loan (i.e. bankruptcy, foreclosure, REO); (28) 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; (29) the original principal
amount of the Mortgage Loan; (30) the original principal amount of any senior
Mortgage Loans; (31) 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; (32) 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; (33)
the Mortgage Loan purpose type; (34) the occupancy status of the Mortgaged
Property at the time of origination; (35) the Mortgagor’s and Co-Mortgagor’s
FICO score; (36) a code indicating the mortgage insurance provider (PMI or
LPMI)
and percent of coverage, if applicable; (37) the mortgage insurance certificate
number; a code indicating the method of payment for mortgage insurance premiums
and cost (LPMI), if applicable; (38) the loan documentation type; (39) the
back-end debt to income ratio; (40) number of Mortgagors; (41) Mortgagor Social
Security Number; (42) co-Mortgagor Social Security Number; (43) Mortgagor date
of birth; (44) co-Mortgagor date of birth; (45) Mortgagor gender; (46)
co-Mortgagor gender; (47) Mortgagor race; (48) co-Mortgagor race; (49) combined
annual income; (50) a code indicating first time buyer; (51) the monthly
Servicing Fee, if provided; (52) the tax service contract provider; (53) the
flood insurance certification contract provider; (54) the monthly tax and
insurance payment; and (55) the escrow balance as of the Cut-Off Date; (56)
the
first Adjustment Date and the Adjustment Date frequency; (57) the Gross Margin;
(58) the Maximum Mortgage Interest Rate under the terms of the Mortgage Note;
(59) the Minimum Mortgage Interest Rate under the terms of the Mortgage Note;
(60) the Initial Rate Cap and Periodic Rate Cap; (61) the first Adjustment
Date
immediately following origination and the related Cut-off Date; (62) the Index;
(63) a code indicating whether the type of adjustable rate mortgage loan (i.e.
3/1, 5/1/7/1, etc); (64) the Lifetime Rate Cap; (65) a code indicating whether
the Mortgage Loan I a Convertible Mortgage Loan and (66) a code indicating
whether there is a Prepayment Charge. 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, ownership to be in fee simple, improved by a residential
dwelling, securing repayment of the debt evidenced by a Mortgage
Note.
Mortgagor:
The
obligor on a Mortgage Note.
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 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 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, 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.
“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 penalty or premium
thereon and 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.
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 2.05.
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:
Salomon
Brothers Realty Corp. 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 Corporation.
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 ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ 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; (ii) have a Mortgage
Loan Remittance Rate not less than and not more than 2% greater than the
Mortgage Loan Remittance Rate of the Deleted Mortgage Loan; (iii) have a
remaining term to maturity not greater than and not more than one year less
than
that of the Deleted Mortgage Loan; and (iv) comply with each representation
and
warranty set forth in Sections 3.01 and 3.02.
Rating
Agency:
Any of
Fitch, ▇▇▇▇▇’▇ 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, ▇▇▇▇▇▇
Mae
or ▇▇▇▇▇▇▇ 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 ▇▇▇▇▇▇ Mae Mortgage Selling and
Servicing Contract, a Pool Purchase Contract, and any and all servicing
agreements and tri-party agreements reasonably required by ▇▇▇▇▇▇ ▇▇▇ with
respect to a ▇▇▇▇▇▇ Mae Transfer, (ii) a Purchase Contract and all purchase
documents associated therewith as set forth in the ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇’ &
Servicers’ Guide, and any and all servicing agreements and tri-party agreements
reasonably required by ▇▇▇▇▇▇▇ Mac with respect to a ▇▇▇▇▇▇▇ 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.
Remittance
Date:
The
18th
day (or
if such 18th
day is
not a Business Day, the first Business Day immediately preceding) of any month,
beginning with the First Remittance Date.
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, a price equal to (i) (A) prior to the date which
is two (2) months following the Closing Date, the product of the Stated
Principal Balance of such Mortgage Loan times the greater of (x) the Purchase
Price Percentage, or (y) 100%, and (B) thereafter, the Stated Principal Balance
of the Mortgage Loan plus (ii) interest on such Stated Principal Balance at
the
Mortgage Loan Remittance Rate from the date on which interest has last been
paid
and distributed to the Purchaser to the last day of the month in which such
repurchase occurs, less amounts received or advanced in respect of such
repurchased Mortgage Loan which are being held in the Custodial Account for
distribution in the month of repurchase.
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,
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.
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-1
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.
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.
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.
UGI:
United
Guaranty Residential Insurance Company or any successor thereto.
Underwriting
Guidelines:
The
underwriting guidelines of the Company with respect to jumbo prime Mortgage
Loans, attached hereto as Exhibit
H.
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 2.03, 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.
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.
| Section 2.02 |
Purchase
Price.
|
On
the
related Closing Date, Purchaser shall pay to 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 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 4:00pm, Eastern Time, in
immediately available funds to an account designated by Company. 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. All payments of principal and interest
due on a Due Date following the Cut-off Date shall belong to the
Purchaser.
| 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.
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 a sale of assets by
the Company. 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 ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇
Mac, including but not limited to documentation as to the method used in
determining the applicability of the provisions of the Flood Disaster Protection
Act of 1973, as amended, to the Mortgaged Property, documentation evidencing
insurance coverage and eligibility of any condominium project for approval
by
▇▇▇▇▇▇ Mae and periodic inspection reports as required by Section 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 ▇▇▇▇▇▇
▇▇▇ Selling and Servicing Guide, as amended from time to time.
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. Unless otherwise agreed to between the Purchaser
and the Company, the Purchaser may sell and transfer ten or more of the Mortgage
Loans, provided,
however,
that
(i) the
transferee will not be deemed to be a Purchaser hereunder binding upon the
Company unless such transferee shall execute and deliver an assignment,
assumption and recognition agreement to the Company; and (ii) with respect
to
each Mortgage Loan Package (excluding any delinquent Mortgage Loans), in no
event shall there be more than three Persons, unless otherwise set forth in
the
Trade Confirmation or the related Assignment and Conveyance, at any given time
having the status of “Purchaser” hereunder. The Purchaser also shall advise the
Company of the transfer. Upon receipt of notice of the transfer, the Company
shall ▇▇▇▇ its books and records to reflect the ownership of the Mortgage Loans
of such assignee, and shall release the previous Purchaser from its obligations
hereunder with respect to the Mortgage
Loans sold or transferred.
| Section 2.04 |
Delivery
of Documents
|
On
or
before the date which is seven 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). Purchaser
shall pay all fees and expenses of the Custodian.
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.
|
(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
J
hereto;
(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)
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; and
(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.
(vi) an
Assignment and Conveyance, in the form of Exhibit L hereto.
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 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; 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;
(d) Ability
to Service.
The
Company is an approved seller/servicer of conventional residential mortgage
loans for ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac, with the facilities, procedures, and
experienced personnel necessary for the sound servicing of mortgage loans of
the
same type as the Mortgage Loans. The Company is in good standing to sell
mortgage loans to and service mortgage loans for ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ 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 ▇▇▇▇▇▇ Mae or
▇▇▇▇▇▇▇ Mac eligibility requirements or which would require notification to
either ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac;
(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, 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 which would draw into question the validity of this
Agreement or the Mortgage Loans or the sale of the Mortgage Loans of any action
taken or to be taken in connection with the obligations of the Company
contemplated herein, or which would be likely to impair materially the ability
of the Company to perform under the terms 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 was
not made in a manner so as to affect adversely the interests of the
Purchaser;
(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.
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;
| 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
information set forth in the related Mortgage Loan Schedule 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 has been 30 or more days delinquent
at
any time in the past 12 months preceding the related Closing Date. The first
two
Monthly Payments shall be made with respect to the Mortgage Loan within the
month in which it is due, 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;
(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
a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are customary in the area where the Mortgaged Property
is located pursuant to insurance policies conforming to the requirements of
Section 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 Laws.
Any and
all requirements of any federal, state or local law including, without
limitation, usury, truth-in-lending, predatory
and abusive lending laws, real estate settlement procedures, consumer credit
protection, equal credit opportunity or disclosure laws applicable to the
origination and servicing of the Mortgage Loan have been complied with, and
the
Company shall maintain in its possession, available for the Purchaser’s
inspection, and shall deliver to the Purchaser upon demand, evidence of
compliance with all such requirements;
(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 or leasehold 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;
(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 fraud was
committed in connection with the origination of the 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;
No
misrepresentation, negligence, fraud or similar occurrence with respect to
a
Mortgage Loan has taken place on the part of any person, including without
limitation the Mortgagor, any appraiser, any builder or developer, or any other
party involved in the origination of the Mortgage Loan or in the application
of
any insurance in relation to such Mortgage Loan.
(l) Full
Disbursement of Proceeds.
The
Mortgage Loan has been closed and the proceeds of the Mortgage Loan have been
fully disbursed to or for the account of the Mortgagor 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;
(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 doing business’ and 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.
No
Mortgage Loan has a LTV equal to or greater than 95%. The original LTV of the
Mortgage Loan either was not more than 80% 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 80%, 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;
(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 ▇▇▇▇▇▇ ▇▇▇ or
▇▇▇▇▇▇▇ Mac, issued by a title insurer acceptable to ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇
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 (or to the extent that a Mortgage Note provides for negative amortization,
the maximum amount of negative amortization in accordance with the Mortgage),
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;
(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 a savings and loan association, savings bank,
commercial bank, credit union, insurance company, or similar institution which
is supervised and examined by a federal or state authority, or by a mortgagee
approved by the Secretary of Housing and Urban Development pursuant to sections
203 and 211 of the National Housing Act. The Mortgage Interest Rate is the
interest rate set forth in the Mortgage Note. The Mortgage Note is payable
each
month in equal monthly installments of principal and interest, with interest
calculated and payable in arrears, sufficient to amortize the Mortgage Loan
fully by the stated maturity date, over an original term of not more than thirty
years from commencement of amortization. There is no negative
amortization;
(u) Customary
Provisions.
The
Mortgage and the related Mortgage Note 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. 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) 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 ▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇ 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 ▇▇▇▇▇▇ ▇▇▇
and
▇▇▇▇▇▇▇ Mac) and the Mortgage Note and Mortgage are on forms acceptable to
▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇ ▇▇▇;
(w) 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;
(x) 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;
(y) 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;
(z) 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;
(aa) 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;
(bb) 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 ▇▇▇▇▇▇ Mae and ▇▇▇▇▇▇▇ Mac eligibility
requirements.
(cc) 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;
(dd) Due
on
Sale.
The
Mortgage contains an enforceable provision for the acceleration of the payment
of the unpaid principal balance of the Mortgage Loan in the event that the
Mortgaged Property is sold or transferred without the prior written consent
of
the Mortgagor thereunder;
(ee) Consolidation
of Future Advances.
Any
future 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 ▇▇▇▇▇▇ Mae and ▇▇▇▇▇▇▇ Mac.
The consolidated principal amount does not exceed the original principal amount
of the Mortgage Loan;
(ff) 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; and
(gg) 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. 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;
(hh) Appraisal.
The
Mortgage File contains an appraisal of the related Mortgage Property signed
prior to the approval of the Mortgage Loan application by a qualified appraiser,
duly appointed by the Company, who had no interest, direct or indirect in the
Mortgaged Property or in any loan made on the security thereof; and whose
compensation is not affected by the approval or disapproval of the Mortgage
Loan, and 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;
(ii) Soldiers’
and Sailors’ 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 Soldiers’ and Sailors’
Civil Relief Act of 1940, as amended;
(jj) 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;
(kk) 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;
(ll) Regarding
the Mortgagor.
The
Mortgagor is one or more natural persons and/or trustees for an Illinois land
trust or a trustee under a “living trust” and such “living trust” is in
compliance with ▇▇▇▇▇▇ ▇▇▇ guidelines for such trusts;
(mm) High
Cost Loans.
No
Mortgage Loan is (a) subject to the provisions of the Homeownership and Equity
Protection Act of 1994 as amended (“HOEPA”), (b) a “high cost” mortgage loan,
“covered” mortgage loan or “predatory” or “abusive” mortgage loan or any other
comparable term, no matter how defined, under any federal, state or local law
including, without limitation, Section 6-L of the New York Banking Law or (c)
subject to any comparable federal, state or local statutes or regulations,
including, without limitation, the provisions of the Georgia Fair Lending Act,
the City of Oakland, California Anti-Predatory Lending Ordinance No. 12361
or
any other statute or regulation providing assignee liability or enhanced
regulatory scrutiny to holders of such mortgage loans. The total combined points
and fees charged in connection wit the origination of the Mortgage Loan does
not
exceed 5% of the original principal balance of the Mortgage Loan;
(nn) Simple
Interest Mortgage Loans.
None of
the Mortgage Loans are simple interest Mortgage Loans;
(oo) Single
Premium Credit Life Insurance.
None of
the proceeds of the Mortgage Loan were used to finance single-premium credit
life insurance policies;
(pp) 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;
(qq) 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;
(rr) FICO
Scores.
Each
Mortgage Loan has a non-zero FICO score;
(ss) [Reserved]
(tt) 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;
(uu) Leaseholds.
If the
Mortgage Loan is secured by a long-term residential lease, (1) the lessor under
the lease holds a fee simple interest in the land; (2) the terms of such lease
expressly permit the mortgaging of the leasehold estate, the assignment of
the
lease without the lessor’s consent and the acquisition by the holder of the
Mortgage of the rights of the lessee upon foreclosure or assignment in lieu
of
foreclosure or provide the holder of the Mortgage with substantially similar
protections; (3) the terms of such lease do not (a) allow the termination
thereof upon the lessee’s default without the holder of the Mortgage being
entitled to receive written notice of, and opportunity to cure, such default,
(b) allow the termination of the lease in the event of damage or destruction
as
long as the Mortgage is in existence, (c) prohibit the holder of the Mortgage
from being insured (or receiving proceeds of insurance) under the hazard
insurance policy or policies relating to the Mortgaged Property or (d) permit
any increase in rent other than pre-established increases set forth in the
lease; (4) the original term of such lease is not less than 15 years; (5) the
term of such lease does not terminate earlier than five years after the maturity
date of the Mortgage Note; and (6) the Mortgaged Property is located in a
jurisdiction in which the use of leasehold estates in transferring ownership
in
residential properties is a widely accepted practice;
(vv) Payment
in Full:
No
Mortgage Loan will be paid in full on or prior to the related Closing
Date;
(ww) Delinquency
information.
The
information delivered by the Seller to the Purchaser with respect to the
Seller’s loan loss, foreclosure and delinquency experience for the twelve (12)
months immediately preceding the Initial Closing Date on mortgage loans
underwritten to the same standards as the Mortgage Loans and covering mortgaged
properties similar to the Mortgaged Properties, is true and correct in all
material respects;
(xx) The
Mortgage Note, the Mortgage, the Assignment of Mortgage and any other documents
required to be delivered with respect to each Mortgage Loan pursuant; have
been
delivered in compliance with the specific requirements hereof. With respect
to
each Mortgage Loan, the Company is in possession of a complete Mortgage File
in
compliance with Exhibit B, except for such documents as have been delivered
to
the Custodian;
(yy) Interest
Rate. Interest on each Mortgage Loan is calculated on the basis of a 360-day
year consisting of twelve 30-day months;
(zz) Advances:
No Buydowns; No Graduated Payments. No Mortgage Loan contains provisions
pursuant to which Monthly payments are (a) paid or partially paid with funds
deposited in any separate account established by the Company, the Mortgagor
or
(c) contains any other similar provisions which may constitute a “buydown”
provision. The Mortgage Loan is not a graduated payment mortgage loan and the
Mortgage Loan does not have a shared appreciation or other contingent interest
feature. No Mortgage Loan has a balloon payment feature. No Mortgage Loan has
a
balloon payment feature;
(aaa) Construction
Loan. No Mortgage Loan was made in connection with (a) the construction or
rehabilitation of a Mortgaged Property or (b) facilitating the trade in or
exchange of a Mortgaged Property;
(bbb) 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 apparent benefit to the mortgagor, were employed in connection
with
the origination of the Mortgage Loan;
(ccc) No
Mortgagor was required to purchase any credit life, disability, accident or
health insurance product as a condition of obtaining the extension of credit.
No
Mortgagor obtained a prepaid single premium credit life, disability, accident
or
health insurance policy in connection with the origination of the Mortgage
Loan.
No proceeds from any Mortgage Loan were used to purchase single premium credit
insurance policies as part of the origination of, or as a condition to closing,
such Mortgage Loan;
(ddd) If
applicable to the Company or any subsequent Owner, the
Mortgage Loan complies with all applicable consumer credit statutes and
regulations, including, without limitation, the respective Uniform Consumer
Credit Code laws in effect in Colorado, Idaho, Indiana, Iowa, Kansas, Maine,
Oklahoma, South Carolina, Utah and Wyoming, has been originated by a properly
licensed entity, and in all other respects, complies with all of the material
requirements of any such applicable laws;
(eee) [Reserved];
(fff) If
applicable to the Company or any subsequent Owner, except
as
set forth on the related Mortgage Loan Schedule, none of the Mortgage Loans
are
subject to a prepayment penalty. For any Mortgage Loan originated prior to
October 1, 2002 that is subject to a prepayment penalty, such prepayment penalty
does not extend beyond five years after the date of origination. For any
Mortgage Loan originated on or following October 1, 2002 that is subject to
a
prepayment penalty, such prepayment penalty does not extend beyond three years
after the date of origination. With respect to any Mortgage Loan that contains
a
provision permitting imposition of a premium upon a prepayment prior to
maturity: (i) prior to the Mortgage Loan's origination, the Mortgagor agreed
to
such premium in exchange for a monetary benefit, including but not limited
to a
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 such a premium, (iii) the prepayment premium is disclosed
to
the Mortgagor in the loan documents pursuant to applicable state and federal
law, and (iv) notwithstanding any state or federal law to the contrary, the
Seller shall not impose such prepayment premium in any instance when the
mortgage debt is accelerated as the result of the Mortgagor's default in making
the loan payments;
(ggg) The
Seller has complied with all applicable anti-money laundering laws and
regulations, including without limitation the USA Patriot Act of 2001
(collectively, the "Anti-Money Laundering Laws"); the Seller has established
an
anti-money laundering compliance program as required by the Anti-Money
Laundering Laws, has conducted the requisite due diligence in connection with
the origination of each Mortgage Loan for purposes of the Anti-Money Laundering
Laws, including with respect to the legitimacy of the applicable Mortgagor
and
the origin of the assets used by the said Mortgagor to purchase the property
in
question, and maintains, and will maintain, sufficient information to identify
the applicable Mortgagor for purposes of the Anti-Money Laundering
Laws;
(hhh) No
Mortgage Loan is secured by real property or secured by a manufactured home
located in the state of Georgia unless (x) such Mortgage Loan was originated
prior to October 1, 2002 or after March 6, 2003, or (y) the property securing
the Mortgage Loan is not, nor will be, occupied by the Mortgagor as the
Mortgagor's principal dwelling. No Mortgage Loan is a "High Cost Home Loan"
as
defined in the Georgia Fair Lending Act, as amended (the "Georgia Act"). Each
Mortgage Loan that is a "Home Loan" under the Georgia Act complies with all
applicable provisions of the Georgia Act. No Mortgage Loan secured by owner
occupied real property or an owner occupied manufactured home located in the
State of Georgia was originated (or modified) on or after October 1, 2002
through and including March 6, 2003, if applicable to the Company or any
subsequent Owner;
(iii) If
applicable to the Company or any subsequent Owner, n
o
Mortgagor was encouraged or required to select a Mortgage Loan product offered
by the Mortgage Loan's originator which is a higher cost product designed for
less creditworthy borrowers, unless at the time of the Mortgage Loan's
origination, such Mortgagor did not qualify taking into account credit history
and debt to income ratios for a lower cost credit product then offered by the
Mortgage Loan's originator or any affiliate of the Mortgage Loan's originator.
If, at the time of loan application, the Mortgagor may have qualified for a
for
a lower cost credit product then offered by any mortgage lending affiliate
of
the Mortgage Loan's originator, the Mortgage Loan's originator referred the
Mortgagor's application to such affiliate for underwriting
consideration;
(jjj) 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;
(kkk) All
fees
and charges (including finance charges) and whether or not financed, assessed,
collected or to be collected in connection with the origination and servicing
of
each Mortgage Loan have been disclosed in writing to the Mortgagor in accordance
with applicable state and federal law and regulation;
(lll) 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;
(mmm) 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
(nnn) 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.
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.
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 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.
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.
With
respect to any Mortgage Loan, if the related Mortgagor is 30 or more days
delinquent with respect to the Mortgage Loan’s first or second Monthly Payment
due to the Purchaser after the related Closing Date, the Company shall, upon
receipt of notice from the Purchaser, promptly repurchase such Mortgage Loan
from the Purchaser in accordance with this Section 3.03; provided, that no
right
to cure set forth therein shall apply.
| Section 3.04 |
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 8(a) 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 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 Purchase
Transaction, the Purchase shall have the right to carry out additional due
diligence reviews, which additional due diligence shall be at the expense of
the
Company. 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.
| Section 3.05 |
Repurchase
of convertible Mortgage Loans
|
In
the
Event the Mortgagor under any Convertible Mortgage Loan elects to convert said
Mortgage Note to a fixed interest rate Mortgage Note, as provided in said
Mortgage Note, then the Seller shall, at Purchaser’s option, prior to the
effective date of said conversion, repurchase such Convertible Mortgage Loan
from the Purchaser in accordance with Section 3.03 hereof.
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.
The
Mortgage Loans may be subserviced by the Subservicer on behalf of the Company
provided that the Subservicer is a ▇▇▇▇▇▇ ▇▇▇-approved servicer or a ▇▇▇▇▇▇▇
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 ▇▇▇▇▇▇ ▇▇▇ or for
seller/servicers imposed by ▇▇▇▇▇▇▇ Mac, or which would require notification
to
▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ 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.
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, and the Company’s obligation to
make such Monthly Advances shall terminate on the 90th day referred to above.
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 connection with any foreclosure or towards
the restoration or preservation of any Mortgaged Property, unless it shall
determine (a) that such preservation, restoration and/or foreclosure will
increase the proceeds of liquidation of the Mortgage Loan to Purchaser after
reimbursement to itself for such expenses and (b) that such expenses will be
recoverable by it either through Liquidation Proceeds (respecting which it
shall
have priority for purposes of withdrawals from the Custodial Account pursuant
to
Section 4.05) or through Insurance Proceeds (respecting which it shall have
similar priority).
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 if the Purchaser otherwise requests
an environmental inspection or review of such Mortgaged Property to be conducted
by a qualified inspector. Upon completion of the inspection, the Company shall
promptly provide the Purchaser with a written report of the environmental
inspection.
After
reviewing the environmental inspection report, the Purchaser shall determine
how
the 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 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 Corp, as
Servicer, in trust for the Purchaser of Conventional Residential Conventional
Residential Fixed Rate Mortgage Loans and various Mortgagors”. 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.
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, all payments on account
of principal on the Mortgage Loans, including all Principal
Prepayments;
(i) all
payments on account of interest on the Mortgage Loans adjusted to the Mortgage
Loan Remittance Rate;
(ii) all
Liquidation Proceeds;
(iii) 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;
(iv) 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;
(v) any
amount required to be deposited in the Custodial Account pursuant to Section
4.01, 4.09, 5.03, 6.01 or 6.02;
(vi) any
amounts payable in connection with the repurchase of any Mortgage Loan pursuant
to Section 3.03 or 3.06 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;
(vii) 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. Such deposit
shall be made from the Company’s own funds, without reimbursement
therefor.
(viii) 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
(ix) 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.
| 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, 3.06 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, 3.06 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
(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.
| 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 Corp., as Servicer, in trust for the Purchaser of Conventional
Residential Fixed 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.
| 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, 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.
| 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 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 ▇▇▇▇▇▇ ▇▇▇ 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.
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 ▇▇▇▇▇▇ 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.
| 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 ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ 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 ▇▇▇▇▇▇
Mae or ▇▇▇▇▇▇▇ 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.
| 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%, 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% (or such other percentage as
stated in the related Trade Confirmation) 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 80%. 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 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
4.01, 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.
(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% (or such other percentage
as
stated in the related Trade Confirmation) 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 80%. 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
2.05. 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 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.
(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, or in the event the Purchaser is not authorized or
permitted to hold title to real property in the state where the REO Property
is
located, or would be adversely affected under the “doing business” or tax laws
of such state by so holding title, the deed or certificate of sale shall be
taken in the name of such Person or Persons as shall be consistent with an
Opinion of Counsel obtained by the 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 shall acknowledge in writing
that such title is being held as nominee for the Purchaser.
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 if a REMIC election is or is to be
made
with respect to the arrangement under which the Mortgage Loans and any REO
Property are held, the Company 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.
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.
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 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. The proceeds of sale of the REO Property shall
be
promptly deposited in the Custodial Account. As soon as practical thereafter
the
expenses of such sale shall be paid and the Company shall reimburse itself
for
any related unreimbursed Servicing Advances, unpaid Servicing Fees and
unreimbursed advances made pursuant to Section 5.03, and on the Remittance
Date
immediately following the Principal Prepayment Period in which such sale
proceeds are received the net cash proceeds of such sale remaining in the
Custodial Account shall be distributed to the Purchaser.
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 and the fees of any
managing agent of the Company, a Subservicer, or the Company itself. The REO
management fee shall equal to one thousand five-hundred dollars ($1,500). 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).
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 Seller shall make interest rate adjustments for each
Mortgage Loan in compliance with the requirements of the related Mortgage and
Mortgage Note. The Seller shall execute and deliver the notices required by
each
Mortgage and Mortgage Note regarding interest rate adjustments. The Seller
also
shall provide timely notification to the Purchaser of all applicable data and
information regarding such interest rate adjustments and the Seller’s methods of
implementing such interest rate adjustments. Upon the discovery by the Seller
or
the Purchaser that the Seller has failed to adjust a Mortgage Interest Rate
or a
Monthly Payment pursuant to the terms of the related Mortgage Note and Mortgage,
the Seller shall immediately deposit in the Custodial Account from its own
funds
the amount of any interest loss caused thereby without reimbursement
therefor.
| Section 4.21 |
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 shall not take any action,
cause the REMIC to take any action or fail to take (or fail to cause to be
taken) any action that, under the REMIC Provisions, if taken or not taken,
as
the case may be, could (I) endanger the status of the REMIC as a REMIC or (ii)
result in the imposition of a tax upon the REMIC (including but not limited
to
the tax on “prohibited transactions” as defined in Section 860F(a)(2) of the
Code and the tax on “contributions” to a REMIC set forth in Section 860G(d) of
the Code) unless the 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.
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.
With
respect to any remittance received by the Purchaser after the second Business
Day following the Business Day on which such payment was due, the 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 Fidelity 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, not more than 60 days after the end of each calendar year, the Company
shall furnish to each Person who was a Purchaser at any time during such
calendar year a statement in accordance with the requirements of applicable
federal income tax law as to the aggregate of remittances for the applicable
portion of such year.
Such
obligation of the Company shall be deemed to have been satisfied to the extent
that substantially comparable information shall be provided by the Company
pursuant to any requirements of the Internal Revenue Code as from time to time
are in force.
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
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.
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 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. If an
assumption fee is collected by the Company for entering into an assumption
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 ▇▇▇▇▇▇ ▇▇▇ 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.
| 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 in the Monthly Remittance
Advice as provided in Section 5.02, and may request the release of any Mortgage
Loan Documents. 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.
| Section 6.04 |
Annual
Statement as to Compliance.
|
(a)
The
Company will deliver to the Purchaser not later than March 15th
of each
year, an Officers' Certificate (each, an "Annual Statement of Compliance")
stating, as to each signatory thereof, that (i) a review of the activities
of
the Company during the preceding year and of performance under this Agreement
has been made under such officers' supervision and (ii) to the best of such
officers' knowledge, based on such review, the Company has fulfilled all of
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. Copies of such
statement shall be provided by the Purchaser to any Person identified as a
prospective purchaser of the Mortgage Loans.
(b) For
so
long as the Mortgage Loans are being master serviced by a master servicer in
a
securitization transaction (the "Master Servicer"), by March 15th
of each
year (or if 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 to the Master Servicer for
the benefit of such Master Servicer and its officers, directors and affiliates,
certifying as to the following matters:
(i) Based
on
my knowledge, the information in the Annual Statement of Compliance, the Annual
Independent Public Accountant's Servicing Report delivered pursuant to Section
6.05 (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 of Compliance or 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.
(c) The
Company shall indemnify and hold harmless the Master Servicer and its officers,
directors, agents and affiliates 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 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 the Master
Servicer, then the Company agrees that it shall contribute to the amount paid
or
payable by the Master Servicer as a result of the losses, claims, damages or
liabilities of the Master Servicer in such proportion as is appropriate to
reflect the relative fault of the Master Servicer 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 the Company's negligence, bad faith or willful
misconduct in connection therewith.
| Section 6.05 |
Annual
Independent Public Accountants’ Servicing Report.
|
Not
later
than March 15th
of each
year, the Company at its expense shall cause a firm of independent public
accountants (which may also render other services to the Company) which is
a
member of the American Institute of Certified Public Accountants to furnish
a
statement to the Purchaser or its designee to the effect that such firm has
examined certain documents and records relating to the servicing of the Mortgage
Loans under this Agreement or of mortgage loans under pooling and servicing
agreements (including the Mortgage Loans and this Agreement) substantially
similar one to another (such statement to have attached thereto a schedule
setting forth the pooling and servicing agreements covered thereby) and that,
on
the basis of such examination conducted substantially in compliance with the
Uniform Single Attestation Program for Mortgage Bankers, such firm confirms
that
such servicing has been conducted in compliance with such pooling and servicing
agreements except for such significant exceptions or errors in records that,
in
the opinion of such firm, the Uniform Single Attestation Program for Mortgage
Bankers requires it to report. Copies of such statement shall be provided by
the
Purchaser to any Person identified as a prospective purchaser of the Mortgage
Loans.
| Section 6.06 |
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, but no fewer
than ten (10) of the Mortgage Loans (unless otherwise agreed to by the Purchaser
and the Company), 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 shall (a) execute any Reconstitution Agreement 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 ten (10) Business
Days
after such receipt, and (b) provide to ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, the trustee
or a
third party purchaser, as the case may be, subject to any Reconstitution
Agreement and/or the Purchaser: (i) any and all information and appropriate
verification of information which may be reasonably available to the Company,
whether through letters of its auditors and counsel or otherwise, as the
Purchaser shall reasonably request; (ii) to deliver to the Purchaser for
inclusion in any prospectus or other offering material such publicly available
information regarding the Seller, its financial condition and its mortgage
loan
delinquency, foreclosure and loss experience and any additional information
requested by the Purchaser, and to deliver to the Purchaser any similar non
public, unaudited financial information with respect to such information
relating to mortgage loan delinquency, foreclosure and loss
experience,
in which
case the Purchaser shall bear the cost of having such information audited by
certified public accountants if the Purchaser desires such an audit, or as
is
otherwise reasonably requested by the Purchaser and which the Seller is capable
of providing without unreasonable effort or expense, and to indemnify the
Purchaser and its affiliates for misstatements or omissions or any alleged
misstatements or omissions contained (a) in such information and (b) on the
related Mortgage Loan Schedule; and (iii) such additional representations,
warranties, covenants, opinions of counsel, letters from auditors, and
certificates of public officials or officers of the Company as are reasonably
believed necessary by ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, the trustee, such third party
purchaser, any master servicer, any rating agency or the Purchaser, as the
case
may be, in connection with such transactions.
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
▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ 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 ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ 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.
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.
With
respect to each Whole Loan Transfer and Pass-Through Transfer, the Company
shall
establish a Custodial Account and an Escrow Account under this Agreement with
respect to the Mortgage Loans subject to such Whole Loan Transfer and
Pass-Through Transfer (the “Assigned Loans”), as the case may be, separate from
the Custodial Account and the Escrow Account previously established under this
Agreement with respect to the Mortgage Loans. The sale or transfer of the
Assigned Loans pursuant to a Whole Loan or Pass-Through Transfer shall be deemed
to create a separate and distinct servicing agreement by the Company with
respect to the Assigned Loans.
| Section 7.02 |
Purchaser’s
Repurchase and Indemnification Obligations.
|
Upon
receipt by the Company of notice from ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, a third party
purchaser or the trustee of a breach of any Purchaser representation or warranty
contained in any Reconstitution Agreement or a request by ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇
Mac or the trustee, as the case may be, for the repurchase of any Mortgage
Loan
transferred to ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac pursuant to an Agency Transfer, to
a
third party purchaser pursuant to a Whole Loan Transfer or to a trustee pursuant
to a Pass-Through Transfer, the Company shall promptly notify the Purchaser
of
same and shall, at the direction of the Purchaser, use its best efforts to
cure
and correct any such breach and to satisfy the requests or concerns of ▇▇▇▇▇▇
Mae, ▇▇▇▇▇▇▇ Mac, the third party purchaser, or the trustee related to such
deficiencies of the related Mortgage Loans transferred to ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇
Mac, or the trustee.
The
Purchaser shall repurchase from the Company any Mortgage Loan transferred to
▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac pursuant to an Agency Transfer, to a third party
purchaser pursuant to a Whole Loan Transfer or to a trustee pursuant to a
Pass-Through Transfer with respect to which the Company has been required by
▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, the third party purchaser or the trustee to repurchase
due to a breach of a representation or warranty made by the Purchaser with
respect to the Mortgage Loans, or the servicing thereof prior to the transfer
date to ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, a third party purchaser or the trustee in
any
Reconstitution Agreement and not due to a breach of the Company’s
representations or obligations thereunder or pursuant to this Agreement. The
repurchase price to be paid by the Purchaser to the Company shall equal that
repurchase price paid by the Company to ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, the third
party
purchaser or the third party purchaser plus all reasonable costs and expenses
borne by the Company in connection with the cure of said breach of a
representation or warranty made by the Purchaser and in connection with the
repurchase of such Mortgage Loan from ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, a third party
purchaser or the trustee, including, but not limited to, reasonable and
necessary attorneys’ fees.
At
the
time of repurchase, the Custodian and the Company shall arrange for the
reassignment of the repurchased Mortgage Loan to the Purchaser according to
the
Purchaser’s instructions and the delivery to the Custodian of any documents held
by ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac, a third party purchaser or the trustee with respect
to the repurchased Mortgage Loan pursuant to the related Reconstitution
Agreement. In the event of a repurchase, the Company shall, simultaneously
with
such reassignment, give written notice to the Purchaser that such repurchase
has
taken place, and amend the related Mortgage Loan Schedule to reflect the
addition of the repurchased Mortgage Loan to this Agreement. In connection
with
any such addition, the Company and the Purchaser shall be deemed to have made
as
to such repurchased 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
repurchase.
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.
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.
(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. 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 ▇▇▇▇▇▇
Mae, ▇▇▇▇▇▇▇ 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 reasonable 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.
| 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.
| Section 9.04 |
Limitation
on Resignation and Assignment by Company.
|
The
Purchaser has entered into this Agreement with the Company and 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) or sell or otherwise dispose of all or substantially all of its
property or assets without the prior written consent of the Purchaser, which
consent shall not be unreasonably withheld.
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. 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. 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 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
(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 ▇▇▇▇▇▇ ▇▇▇ lender;
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.
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.
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.
| 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.
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) 1.50% and (b) the
outstanding principal balance 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, provided, that upon termination of the Agreement with
respect to such Delinquent Mortgage Loan or REO Property, the Purchaser shall
reimburse the Company for all outstanding Servicing Advances or Servicing
Fees.
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 sixty (60) 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 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 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.
Any
successor appointed as provided herein shall execute, acknowledge and deliver
to
the Company and to the Purchaser an instrument accepting such appointment,
wherein the successor shall make the representations and warranties set forth
in
Section 3.01, except for subsections (f), (h), (i) and (k) thereof, 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 in
the
successor all such rights, powers, duties, responsibilities, obligations and
liabilities of the Company.
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 |
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 12.03 |
Governing
Law.
|
THIS
AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF OHIO
AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
| Section 12.04 |
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 12.05 |
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:
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇
▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
with
a
copy to:
National
City Mortgage Co.
ATTN:
▇.
▇▇▇▇▇▇▇ Case
▇▇▇▇
▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
or
such
other address as may hereafter be furnished to the Purchaser in writing by
the
Company;
(ii) if
to
Purchaser:
Citigroup
Global Markets Realty Corp.
▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
| Section 12.06 |
Severability
of Provisions.
|
If
any
one or more of the covenants, agreements, provisions or terms of this Agreement
shall be held invalid for any reason whatsoever, then such covenants,
agreements, provisions or terms shall be deemed severable from the remaining
covenants, agreements, provisions or terms of this Agreement and shall in no
way
affect the validity or enforceability of the other provisions of this
Agreement.
| Section 12.07 |
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 12.08 |
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 12.09 |
Recordation
of Assignments of Mortgage.
|
To
the
extent permitted by applicable law, each of the Assignments of Mortgage is
subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which any
or
all of the Mortgaged Properties are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected at the
Company’s expense in the event recordation is either necessary under applicable
law or requested by the Purchaser at its sole option.
| Section 12.10 |
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. Upon such assignment of rights and assumption of obligations, the
assignee or designee shall accede to the rights and obligations hereunder of
the
Purchaser with respect to such Mortgage Loans and the Purchaser as assignor
shall be released from all obligations hereunder with respect to such Mortgage
Loans from and after the date of such assignment and assumption. All references
to the Purchaser in this Agreement shall be deemed to include its assignee
or
designee.
| Section 12.11 |
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.
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, including,
without limitation, mass mailings based on commercially acquired mailing lists,
or the Company’s customer portfolio, and newspaper, radio and television
advertisements shall not constitute solicitation under this Section
12.11.
Section12.12 Waivers
No
term
or provision of this Agreement may be waived or modified unless specified within
the terms of this agreements such waiver or modification is in writing and
signed by the party against whom such waiver or modification is sought to be
enforced.
Section
12.13 Exhibits
The
exhibits to this Agreement are hereby incorporated and made a part hereof and
are in integral part of this Agreement.
Section
12.14 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 their 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
12.15 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.
Section
12.16 Entire Agreement.
This
Agreement constitutes the entire agreement and understanding of the parties
with
respect to the matters and transactions contemplated by this Agreement and,
except to the extent otherwise set forth in writing, supersedes any prior
agreement and understandings with respect to those matters and
transactions.
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.
CITIGROUP
GLOBAL MARKETS REALTY CORP.
By:
/s/
[Authorized Signatory]
Name:
_________________________________
Title:
__________________________________
NATIONAL
CITY MORTGAGE CO.
By:
/s/
[Authorized Signatory]
Name:
_________________________________
Title:
__________________________________
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STATE
OF_____________
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)
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)
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ss.:
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|
|
COUNTY
OF___________
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)
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On
the __
day of ________, 2005 before me, a Notary Public in and for said State,
personally appeared ________, known to me to be ______________________________
of _____________________________ that executed the within instrument and also
known to me to be the person who executed it on behalf of said corporation,
and
acknowledged to me that such corporation executed the within
instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand affixed my office seal the day
and
year in this certificate first above written.
_______________________________________
Notary
Public
My
Commission expires __________________
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STATE
OF OHIO
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)
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)
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ss.:
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|
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COUNTY
OF ▇▇▇▇▇▇▇▇▇▇
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)
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On
the __
day of _______, 2005 before me, a Notary Public in and for said State,
personally appeared __________, known to me to be ______________ of National
City Mortgage Co. the corporation that executed the within instrument and also
known to me to be the person who executed it on behalf of said corporation,
and
acknowledged to me that such corporation executed the within
instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand affixed my office seal the day
and
year in this certificate first above written.
_______________________________________
Notary
Public
My
Commission expires __________________
EXHIBIT
A
MORTGAGE
LOAN SCHEDULE
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 Amended and Restated Master Seller’s Warranties and Servicing Agreement
to which this Exhibit is attached (the “Agreement”):
| 1. |
The
original Mortgage Note bearing all intervening endorsements, endorsed
“Pay
to the order of _________ without recourse” and signed via original
signature in the name of the Company by an authorized officer (in the
event that 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 in the event that 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]”).
|
| 2. |
The
original of any guarantee executed in connection with the Mortgage
Note
(if any).
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| 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 Company 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 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 insurance
company that issued the title policy to be a true and complete copy
of the
original recorded Mortgage.
|
| 4. |
The
originals of all assumption, modification, consolidation or extension
agreements, with evidence of recording
thereon.
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| 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, 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 Company 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 Company; or (ii) in the case
of an
intervening assignment where a public recording office retains the
original recorded intervening assignment 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.
|
| 7. |
The
original PMI Policy, LPMI Policy or certificate of insurance, where
required pursuant to the Agreement.
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| 8. |
The
original mortgagee policy of title insurance or attorney’s opinion of
title and abstract of title.
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| 9. |
Any
security agreement, chattel mortgage or equivalent executed in connection
with the Mortgage.
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| 10. |
The
original hazard insurance policy and, if required by law, flood insurance
policy, in accordance with Section 4.10 of the
Agreement.
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| 11. |
Residential
loan application.
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| 12. |
Mortgage
Loan closing statement.
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| 13. |
Verification
of employment and income.
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| 14. |
Verification
of acceptable evidence of source and amount of
downpayment.
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| 15. |
Credit
report on the Mortgagor.
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| 16. |
Residential
appraisal report.
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| 17. |
Photograph
of the Mortgaged Property.
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| 18. |
Survey
of the Mortgaged Property.
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| 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.
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| 21. |
If
available, termite report, structural engineer’s report, water potability
and septic certification.
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| 22. |
Sales
contract.
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| 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.
|
The
original recorded power of attorney, if the Mortgage was executed pursuant
to a
power of attorney, with evidence of recording thereon;
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.
EXHIBIT
C-1
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 Amended and Restated Master Seller’s Warranties and Servicing
Agreement to which this Exhibit is annexed (the “Agreement”):
(a) the
original Mortgage Note bearing all intervening endorsements, endorsed “Pay to
the order of ___________, without recourse” and signed via original signature in
the name of the Company by an authorized officer. 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) 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) the
originals of all intervening assignments of mortgage with evidence of recording
thereon, including warehousing assignments, if any;
(g) the
original PMI or LPMI Policy or certificate, if private mortgage guaranty
insurance is required pursuant to the Agreement;
(h) the
original mortgagee title insurance policy;
(i) the
original of any security agreement, chattel mortgage or equivalent executed
in
connection with the Mortgage; and
(j) such
other documents as the Purchaser may require.
EXHIBIT
D-1
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 Amended and
Restated Master Seller’s Warranties and Servicing Agreement, dated as of
September 1, 2003, as amended and restated to and including May 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:
__________________________________
EXHIBIT
D-2
CUSTODIAL
ACCOUNT LETTER AGREEMENT
_________________,
200_
To:
_________________________________
_________________________________
_________________________________
(the
“Depository”)
As
Company under the Amended and Restated Master Seller’s Warranties and Servicing
Agreement, dated as of September 1, 2003, as amended and restated to and
including May 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 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:__________________________________
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:__________________________________
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 Amended and Restated
Master Seller’s Warranties and Servicing Agreement, dated as of September 1,
2003, as amended and restated to and including May 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:
__________________________________
EXHIBIT
E-2
ESCROW
ACCOUNT LETTER AGREEMENT
___________________,
200_
To:
_________________________________
_________________________________
_________________________________
(the
“Depository”)
As
Company under Amended and Restated Master Seller’s Warranties and Servicing
Agreement, dated as of September 1, 2003, as amended and restated to and
including May 1, 2005, 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 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:__________________________________
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:__________________________________
EXHIBIT
F
MONTHLY
REMITTANCE ADVICE
EXHIBIT
G
[RESERVED]
EXHIBIT
H
UNDERWRITING
GUIDELINES
EXHIBIT
I
COMPANY’S
OFFICER’S CERTIFICATE
I,
___________________________ hereby certify that I am the duly elected
____________________ of National City Mortgage Co., 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] [Certificate of limited partnership and limited
partnership agreement] 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) the
Amended and Restated Master Seller’s Warranties and Servicing Agreement (the
“Purchase Agreement”), dated as of _______________, by and between the Company
and ___________________ (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 ____________, 2001 (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. 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.
7. 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]
NATIONAL
CITY MORTGAGE CO.
(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]
NATIONAL
CITY MORTGAGE CO.
(Company)
By:________________________________
Name:______________________________
Title: [Assistant]
Secretary
EXHIBIT
J
[FORM
OF
OPINION OF COUNSEL TO THE COMPANY]
(Date)
[PURCHASER]
|
Re:
|
Amended
and Restated Master Seller’s Warranties and Servicing Agreement, dated as
of September 1, 2003, as
amended
and restated to and including May 1,
2005
|
Gentlemen:
I
have
acted as counsel to National City Mortgage Co., a _____________________ (the
“Company”), in connection with the sale of certain loans by the Company to
_____________________ (“the “Purchaser”) pursuant to (i) an Amended and Restated
Master Seller’s Warranties and Servicing Agreement, dated as of September 1,
2003, as amended and restated to and including May 1, 2005, 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.
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.
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 ether 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,
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 Citigroup Global Markets Realty Corp. from the Company named below pursuant
to that certain Mortgage Loan Purchase and Servicing Agreement, dated as
of______________, 2002, 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:_______________________________
2. Certification
of Release
The
Company named below hereby certifies to Citigroup Global Markets Realty Corp.
that, as of the Date and Time of Sale of the above mentioned Mortgage Loans
to
Citigroup Global Markets Realty Corp., 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:_____________________________________
EXHIBIT
L
ASSIGNMENT
AND CONVEYANCE
On
this
__________ day of _______________, 200_, National City Mortgage Co. (“Company”)
as the Company under that certain Amended and Restated Master Seller’s
Warranties and Servicing Agreement, dated as of September 1, 2003, as amended
and restated to and including May 1, 2005 (the “Agreement”) does hereby sell,
transfer, assign, set over and convey to Citigroup Global Markets Realty Corp.
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 2.04 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 representation 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, and with respect to this Mortgage Loan
Package, the Company makes the following additional representations and
warranties to the Purchaser, which additional representations and warranties
are
hereby incorporated into Section 3.02 of the Agreement:
LOAN
TYPE: [FIXED
RATE][ADJUSTABLE RATE]
Number
of
Mortgage Loans: _________________________
Original
Principal Balance: $________________________
Stated
Principal Balance: $________________________
Weighted
Average Mortgage Interest Rate: _____%
Weighted
Average Servicing Fee
Rate: _____%
Weighted
Average Mortgage Loan
Remittance
Rate: _____%
Weighted
Average LTV: _____%
Weighted
Average Remaining Months
to
Maturity: _______
months
For
Adjustable Rate Mortgage Loans:
Type:
_______
Index:
_______
Weighted
Average Gross Margin: _______%
Weighted
Average Months to
Next
Adjustment Date: _______
months
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:___________________________________