<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported) July 16, 1998
Mellon Residential Funding Corporation
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 333-24453 23-2889067
- ------------------------------ ------------ ----------
(State or other (Commission (IRS Employer
jurisdiction of incorporation) File Number) ID Number)
One Mellon Bank Center, Room 410, Pittsburgh, Pennsylvania 15258
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, including area code: (412) 236-6559
--------------
N/A
- --------------------------------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE> 2
Item 5. Other Events
------------
Filing of Computational Materials.*
- -----------------------------------
Pursuant to Rule 424(b) under the Securities Act of 1933, as amended,
Mellon Residential Funding Corporation (the "Depositor") is filing a prospectus
and prospectus supplement with the Securities and Exchange Commission relating
to its Mortgage Pass-Through Certificates, Series MHELT 1998-1.
In connection with the offering of the Mortgage Pass-Through
Certificates, Series MHELT 1998-1, J.P. Morgan Securities Inc. prepared certain
materials (the "Computational Materials") which were distributed by J.P. Morgan
Securities Inc. and Mellon Financial Markets, Inc. (the "Underwriters") to their
potential investors. Although the Depositor provided the Underwriters with
certain information regarding the characteristics of the Mortgage Loans in the
related portfolio, it did not participate in the preparation of the
Computational Materials. The Computational Materials are attached hereto as
Exhibit 99.1.
- ---------------
* Capitalized terms used and not otherwise defined herein shall have the
meanings assigned to them in the Prospectus dated July 16, 1998, and Prospectus
Supplement dated July 16, 1998, of Mellon Residential Funding Corporation,
relating to its Mortgage Pass-Through Certificates, Series MHELT 1998-1.
-2-
<PAGE> 3
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
-------------------------------------------------------------------
(a) Not applicable.
(b) Not applicable.
(c) Exhibits:
8.1 Opinion of Stroock & Stroock & Lavan LLP with respect to
certain tax matters.
23.1 Consent of Stroock & Stroock & Lavan LLP (included in Exhibit
8.1).
99.1 Computational Materials.
-3-
<PAGE> 4
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
MELLON RESIDENTIAL FUNDING CORPORATION
By: /s/ STEPHEN COBAIN
----------------------
Name: Stephen Cobain
Title: President
Dated: July 20, 1998
<PAGE> 5
EXHIBIT INDEX
-------------
Exhibit Page
- ------- ----
8.1 Opinion of Stroock & Stroock & Lavan LLP with respect to
certain tax matters.
23.1 Consent of Stroock & Stroock & Lavan LLP (included in
Exhibit 8.1).
99.1 Computational Materials.
<PAGE> 1
Exhibit 8.1
Stroock & Stroock & Lavan LLP
180 Maiden Lane
New York, New York 10038-4982
July 16, 1998
Mellon Residential Funding Corporation
One Mellon Bank Center
500 Grant Street
Pittsburgh, Pennsylvania 15258
RE: Mellon Residential Funding Corporation
Registration Statement on Form S-3
(File No. 333-24453)
--------------------------------------
Ladies and Gentlemen:
We have acted as special counsel for Mellon Residential Funding Corporation, a
Delaware Corporation ("the Company") in connection with the issuance of
$132,329,000 aggregate principal amount of Mellon Bank Home Equity
Installment Loan Trust 1998-1 Mortgage Pass-Through Certificates, Series MHELT
1998-1 (the "Certificates"). A Registration Statement on Form S-3 relating to
the Certificates (No. 333-24453) (the "Registration Statement") has been filed
with the Securities and Exchange Commission under the Securities Act of 1933, as
amended (the "Securities Act"). As set forth in the Prospectus dated July 16,
1998 and the Prospectus Supplement dated July 16, 1998, the Certificates will be
issued by a trust established by the Company pursuant to the provisions of a
Pooling and Servicing Agreement dated as of June 30, 1998 (the "Pooling and
Servicing Agreement") among the Company, as Depositor, Mellon Bank, N.A., as the
Seller and Master Servicer, and Bankers Trust Company of California, N.A., as
the Trustee.
We have examined a form of the Pooling and Servicing Agreement, a form of the
Certificates, and a form of the Prospectus and Prospectus Supplement referred to
above. We also have examined such other documents, papers, statutes and
authorities as we have deemed necessary to form the basis for the opinions
hereinafter expressed. In our examination of such material, we have assumed the
genuineness of all signatures, the authenticity of all documents submitted to us
as originals and the conformity to original documents of copies of documents
submitted to us.
<PAGE> 2
Securities and Exchange Commission
July 16, 1998
Page 2
On the basis of the foregoing, we are of the opinion that the information in the
Prospectus Supplement under the caption "Federal Income Tax Considerations," and
in the Prospectus under the caption "Federal Income Tax Considerations," to the
extent that it constitutes matters of law or legal conclusions, is correct in
all material respects.
This opinion is based on current provisions of the Internal Revenue Code of
1986, as amended, the Treasury regulations promulgated thereunder, and judicial
and administrative interpretations thereof.
Except as provided below, this opinion is solely for the benefit of the
addressee hereof and may not be relied upon in any manner by any other person or
entity.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement, to the references to us in the Prospectus Supplement,
and to the filing of this opinion as an exhibit to an application made by or on
behalf of the Company or any dealer in connection with the registration of the
Certificates under the securities or blue sky laws of any state or jurisdiction.
In giving such permission, we do not admit hereby that we come within the
category of persons whose consent is required under Section 7 of the Securities
Act or the General Rules and Regulations of the Securities and Exchange
Commission thereunder.
Very truly yours,
/s/ Stroock & Stroock & Lavan LLP
STROOCK & STROOCK & LAVAN LLP
<PAGE> 1
Exhibit 99.1
JPMORGAN Page 1 [LOGO] MELLON BANK CORPORATION
- --------------------------------------------------------------------------------
JPMORGAN [LOGO] MELLON BANK CORPORATION July 14, 1997
- --------------------------------------------------------------------------------
$137,449,000 MELLON BANK HOME EQUITY INSTALLMENT LOAN TRUST, SERIES 1998-1
Mellon Bank N.A. -- Seller/Master Servicer
TRANSACTION HIGHLIGHTS
<TABLE>
<CAPTION>
EXPECTED EXPECTED
APPROXIMATE RATINGS AVERAGE LIFE PAYMENT FINAL EXPECTED
CLASS CLASS SIZE (S&P/ TO 10% WINDOWS TO 10% CALL DAY MATURITY TO LEGAL FINAL
CLASS(2) TYPE1 ($ THOUSANDS) MOODY'S) CALL/MATURITY(3) (MONTHS)3 COUNT 10% CALL MATURITY
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
A-1 Fixed 50,400,000 AAA/Aaa 0.95/0.95 8/98 - 5/00 (22) 30/360 5/00
A-2 Fixed 14,000,000 AAA/Aaa 2.10/2.10 5/00 - 12/00 (8) 30/360 12/00
A-3 Fixed 23,000,000 AAA/Aaa 3.10/3.10 12/00 - 8/02 (21) 30/360 8/02
A-4 Fixed 25,299,000 AAA/Aaa 6.12/7.07 8/02 - 5/06 (46) 30/360 5/06
A-5 Fixed NAS 13,750,000 AAA/Aaa 6.26/6.45 9/01 - 5/06 (57) 30/360 5/06
B Fixed 11,000,000 A/- 5.25/5.48 8/01 - 5/06 (58) 30/360 5/06
-----------------------------
TOTAL $137,449,000
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
MANAGERS: J.P. Morgan (lead) and Mellon Financial Markets (Co)
Notes:
------
1 Class A-1 through A-4 sequential pay; Class A-5 concurrent pay starting in
month 37; Class B concurrent pay starting in month 37 subject to
subordination provisions, certain credit enhancement requirements and
trigger events.
2 CPR in Class A-1 through A-5 and B are priced at a prepayment speed of 100%
of the prepayment assumption (PPC) which equals a prepayment speed starting
at 2% in month 1, increasing by 2.22% per month to 22% CPR in month 10, and
remaining at 22% CPR thereafter.
3 Auction Sale after Optional Termination: If the Master Servicer does not
exercise its optional termination right within 90 days after the Optional
Termination Date, the Trustee is required to solicit bids for the purchase
of all Mortgage Loans and REO Property remaining in the Trust Fund. If
satisfactory bids are received as set forth in the Agreement, such remaining
Mortgage Loans and REO Property will be sold and the proceeds distributed to
the Certificateholders in the same priority as distributions on a
Distribution Date.
4 Class A-5 NAS allocation of senior principal distributions: 0% through month
36; 45% month 37 through month 60; 80% month 61 through month 72; 100% month
73 through month 84; and 300% thereafter.
SELLER/MASTER SERVICER: Mellon Bank, N.A.
DEPOSITOR: Mellon Residential Funding Corporation
TRUSTEE: Bankers Trust Company of California, N.A.
UNDERWRITERS: J.P. Morgan Securities, Inc. (lead) & Mellon
Financial Markets, Inc. (co-manager)
COLLATERAL: Fixed home equity loans secured by first and
second lien mortgages. See attached "Collateral
Description".
CLASS A-1 THROUGH A-5, B The prepayment assumption is 100% of the
PREPAYMENT SPEED: prepayment curve, which equates to a prepayment
speed of 2% CPR in the first month, increasing
by 2.22% per month to 22% CPR in month 10 and
remaining at 22% CPR thereafter.
EXPECTED PRICING DATE: TBD
EXPECTED SETTLEMENT DATE: July 24, 1998 through DTC, Euroclear, and CEDEL.
CUT-OFF DATE: June 30, 1998
DISTRIBUTION DATES: The 25th of each month, beginning August 25,
1998
Additional information is available upon request. Information herein is believed
to be reliable but J.P. Morgan does not warrant its completeness or accuracy.
These materials are subject to change from time to time without notice. Past
performance is not indicative of future results. Any description of the
collateral contained herein supersedes any previous collateral information and
will be superseded by the final prospectus relating to the securities. These
materials are not intended as an offer or solicitation with respect to the
purchase or sale of any security, and have been provided to you for
informational purposes only and may not be relied upon by you in evaluating the
merits of investing in the securities. Any investment decision with respect to
the securities should be made by you based solely upon the information contained
in the final prospectus relating to the securities. No assurance or
representation can be made as to the actual rate or timing of principal payments
or prepayments on any of the collateral or the performance characteristics of
the securities. This information was prepared in reliance on information
regarding the collateral furnished by the seller of the collateral. J.P. Morgan
may hold a position or act as market maker in the financial instruments of any
issuer discussed herein or act as advisor or lender to such issuer. J.P. Morgan
Securities Inc. is a member of SIPC and SFA. Copyright 1998 J.P. Morgan & Co.
Incorporated.
<PAGE> 2
JPMORGAN Page 2 [LOGO] MELLON BANK CORPORATION
(TRANSACTION HIGHLIGHTS CONTINUED)
OPTIONAL TERMINATION: On any Distribution Date on
which the Pool Principal Balance is less
than 10% of the Cut-off Date Pool
Principal Balance, the Master Servicer
will have the option to purchase, in
whole, the Mortgage Loans and the REO
Property, if any, remaining in the Trust
Fund.
AUCTION SALE AFTER OPTIONAL If the Master Servicer does not exercise
TERMINATION: its optional termination right within 90
days after the Optional Termination
Date, the Trustee is required to solicit
bids for the purchase of all Mortgage
Loans and REO Property remaining in the
Trust Fund. If satisfactory bids are
received as set forth in the Agreement,
such remaining Mortgage Loans and REO
Property will be sold and the proceeds
distributed to the Certificateholders in
the same priority as distributions on a
Distribution Date.
ERISA ELIGIBILITY: The Class A-1 through A-5 Certificates
WILL be ERISA eligible (and there will
be no prefunding account).
The Class B Certificates are NOT ERISA
eligible.
SMMEA ELIGIBILITY: The Certificates are NOT SMMEA eligible
as there are 2nd mortgages in the pool.
CREDIT ENHANCEMENT
- ------------------
Class A1 through Class A5:
o 8.0% Class B Subordinated Certificates
o Overcollateralization building from 0% to 1% of the original aggregate
Class Certificate Balance, or, if after the Stepdown Date, the greater
of (i) 2% of the Pool Principal Balance as of the last day of the
related Due Period and, (ii) $687,248 which equals 50 bps of the
initial pool balance.
o Monthly Excess Interest Amount
Class B:
o Overcollateralization building from 0% to 1% of the original aggregate
Class Certificate Balance, or, if after the Stepdown Date, the greater
of (i) 2% of the Pool Principal Balance as of the last day of the
related Due Period and, (ii) $687,248 which equals 50 bps of the
initial pool balance.
o Monthly Excess Interest Amount
CLASS RATING LEVEL PERCENT OF TRANSACTION
----------------------------------------------------------
A1-A5 AAA/Aaa 92%
B A/- 8%
Additional information is available upon request. Information herein is believed
to be reliable but J.P. Morgan does not warrant its completeness or accuracy.
These materials are subject to change from time to time without notice. Past
performance is not indicative of future results. Any description of the
collateral contained herein supersedes any previous collateral information and
will be superseded by the final prospectus relating to the securities. These
materials are not intended as an offer or solicitation with respect to the
purchase or sale of any security, and have been provided to you for
informational purposes only and may not be relied upon by you in evaluating the
merits of investing in the securities. Any investment decision with respect to
the securities should be made by you based solely upon the information contained
in the final prospectus relating to the securities. No assurance or
representation can be made as to the actual rate or timing of principal payments
or prepayments on any of the collateral or the performance characteristics of
the securities. This information was prepared in reliance on information
regarding the collateral furnished by the seller of the collateral. J.P. Morgan
may hold a position or act as market maker in the financial instruments of any
issuer discussed herein or act as advisor or lender to such issuer. J.P. Morgan
Securities Inc. is a member of SIPC and SFA. Copyright 1998 J.P. Morgan & Co.
Incorporated.
<PAGE> 3
JPMORGAN Page 3 [LOGO] MELLON BANK CORPORATION
MELLON RESIDENTIAL FUNDING CORP. 1998-1 COLLATERAL DESCRIPTION
--------------------------------------------------------------
COLLATERAL: The collateral pool will consist of a combination of first and
second lien home equity loans. These loans are predominantly used
by borrowers to consolidate debt, for home improvements, to
refinance an existing mortgage loan on more favorable terms, or to
obtain cash proceeds by borrowing against the homeowner's equity
in the related mortgage property.
<TABLE>
<CAPTION>
FIXED RATE HOME EQUITY INSTALLMENT LOANS(1)
-------------------------------------------
<S> <C>
AGGREGATE POOL BALANCE ($MM): $137,449,520.74
NUMBER OF LOANS: 2,454
AVERAGE OUTSTANDING BALANCE: $56,010.40
PRODUCT TYPE: Fixed Rate Home Equity Loans
WEIGHTED AVERAGE COUPON: 8.57%
ORIGINAL WEIGHTED AVERAGE TERM: 174.94 months
REMAINING WEIGHTED AVERAGE TERM: 172.45 months
WEIGHTED AVERAGE SEASONING: 2.49 months
LIEN POSITION: 81.49% first lien, 18.47% second lien, 0.04%
other
WEIGHTED AVERAGE COMBINED LOAN TO VALUE RATIO: 78.56%
PROPERTY TYPE: 97.63% single family; 1.74% townhouse;
0.05% condominium; 0.12% duplex;
0.46% other
OWNER OCCUPANCY: 98.77% primary; 1.10% rental,
0.07% second home, 0.07% other
GEOGRAPHIC DISTRIBUTION ( = 5%): PA (39.79%), OH (26.77%), NJ (12.04%),
VA (10.95%), MD (5.43%)
</TABLE>
NOTE:
(1) All percentages and weighted averages calculated on the outstanding
balance.
Additional information is available upon request. Information herein is believed
to be reliable but J.P. Morgan does not warrant its completeness or accuracy.
These materials are subject to change from time to time without notice. Past
performance is not indicative of future results. Any description of the
collateral contained herein supersedes any previous collateral information and
will be superseded by the final prospectus relating to the securities. These
materials are not intended as an offer or solicitation with respect to the
purchase or sale of any security, and have been provided to you for
informational purposes only and may not be relied upon by you in evaluating the
merits of investing in the securities. Any investment decision with respect to
the securities should be made by you based solely upon the information contained
in the final prospectus relating to the securities. No assurance or
representation can be made as to the actual rate or timing of principal payments
or prepayments on any of the collateral or the performance characteristics of
the securities. This information was prepared in reliance on information
regarding the collateral furnished by the seller of the collateral. J.P. Morgan
may hold a position or act as market maker in the financial instruments of any
issuer discussed herein or act as advisor or lender to such issuer. J.P. Morgan
Securities Inc. is a member of SIPC and SFA.
Copyright 1998 J.P. Morgan & Co. Incorporated.
<PAGE> 4
JPMORGAN Page 4 [LOGO] MELLON BANK CORPORATION
AVERAGE LIFE SENSITIVITY TO CHANGES IN PREPAYMENT RATES
<TABLE>
<CAPTION>
ASSUMES A 10% CALL (OPTIONAL TERMINATION OR AUCTION SALE)
- ----------------------------------------------------------------------------------------------------------------------------------
PPC PREPAYMENT ASSUMPTION
0% 50% 75% 100%(1) 125% 150% 200%
--- ---- ---- -------- ---- ---- ----
WINDOW WINDOW WINDOW WINDOW WINDOW WINDOW WINDOW
WAL (MONTHS) WAL (MONTHS) WAL (MONTHS) WAL (MONTHS) WAL (MONTHS) WAL (MONTHS) WAL (MONTHS)
- -------------------------------------------------------------- ----------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS 4.51 8/98-5/07 1.53 8/98-8/01 1.16 8/98-10/00 0.95 8/98-5/00 0.81 8/98-1/00 0.71 8/98-10/99 0.58 8/98-7/99
A-1 106 37 27 22 18 15 12
CLASS 9.87 5/07-6/09 3.62 8/01-9/02 2.65 10/00-8/01 2.10 5/00-12/00 1.74 1/00-7/00 1.48 10/99-3/00 1.14 7/99-10/99
A-2 26 14 11 8 7 6 4
CLASS 12.50 6/09-5/12 5.65 9/02-5/06 4.04 8/01-11/03 3.10 12/00-8/02 2.46 7/00-7/01 2.08 3/00-1/01 1.57 10/99-6/00
A-3 36 45 28 21 13 11 9
CLASS 14.71 5/12-6/13 10.75 5/06-6/10 8.10 11/03-2/08 6.12 8/02-5/06 4.78 7/01-1/05 3.73 1/01-12/03 2.37 6/00-7/01
A-4 14 50 52 46 43 36 14
CLASS 8.80 8/01-6/13 7.20 8/01-6/10 6.70 8/01-2/08 6.26 9/01-5/06 5.68 10/01-1/05 5.05 12/01-12/03 3.92 7/01-7/02
A-5 143 107 79 57 40 25
CLASS B 13.28 9/08-6/13 8.38 2/03-6/10 6.53 12/01-2/08 5.25 8/01-5/06 4.45 8/01-1/05 3.95 8/01-12/03 3.53 8/01-7/02
58 89 75 58 42 29 12
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
ASSUMES NO 10% CALL (RUN TO MATURITY)
- ------------------------------------------------------------------------------------------------------------------------------------
PPC PREPAYMENT ASSUMPTION
0% 50% 75% 100%(1) 125% 150% 200%
--- ---- ---- -------- ---- ---- ----
WINDOW WINDOW WINDOW WINDOW WINDOW WINDOW WINDOW
WAL (MONTHS) WAL (MONTHS) WAL (MONTHS) WAL (MONTHS) WAL (MONTHS) WAL (MONTHS) WAL (MONTHS)
- --------------------------------------------------------------- ---------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS 14.76 5/12-10/13 11.54 5/06-8/13 9.15 11/03-6/13 7.07 8/02-1/13 5.39 7/01-7/11 3.97 1/01-12/09 2.37 6/00-7/01
A-4 18 88 116 126 121 108 14
CLASS 8.80 8/01-6/13 7.22 8/01-6/13 6.76 8/01-6/13 6.45 9/01-11/12 6.26 10/01-5/11 6.15 12/01-10/09 5.06 7/01-2/07
A-5 143 143 143 135 116 95 68
CLASS B 13.29 9/08-8/13 8.60 2/03-5/13 6.78 12/01-9/11 5.48 8/01-11/09 4.65 8/01-1/08 4.12 8/01-8/06 3.66 8/01-7/04
60 124 118 100 78 61 36
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE:
-----
1 The prepayment assumption is 100% of the prepayment curve (PPC), which
equates to a prepayment speed of 2% CPR in the first month, increasing by
2.22% per month to 22% CPR in month 10 and remaining at 22% thereafter.
2 If the Master Servicer does not exercise its optional termination right
within 90 days after the Optional Termination Date, the Trustee is required
to solicit bids for the purchase of all Mortgage Loans and REO Property
remaining in the Trust Fund. If satisfactory bids are received as set forth
in the Agreement, such remaining Mortgage Loans and REO Property will be sold
and the proceeds distributed to the Certificateholders in the same priority
as distributions on a Distribution Date.
Additional information is available upon request. Information herein is believed
to be reliable but J.P. Morgan does not warrant its completeness or accuracy.
These materials are subject to change from time to time without notice. Past
performance is not indicative of future results. Any description of the
collateral contained herein supersedes any previous collateral information and
will be superseded by the final prospectus relating to the securities. These
materials are not intended as an offer or solicitation with respect to the
purchase or sale of any security, and have been provided to you for
informational purposes only and may not be relied upon by you in evaluating the
merits of investing in the securities. Any investment decision with respect to
the securities should be made by you based solely upon the information contained
in the final prospectus relating to the securities. No assurance or
representation can be made as to the actual rate or timing of principal payments
or prepayments on any of the collateral or the performance characteristics of
the securities. This information was prepared in reliance on information
regarding the collateral furnished by the seller of the collateral. J.P. Morgan
may hold a position or act as market maker in the financial instruments of any
issuer discussed herein or act as advisor or lender to such issuer. J.P. Morgan
Securities Inc. is a member of SIPC and SFA. Copyright 1998 J.P. Morgan & Co.
Incorporated.
<PAGE> 5
JPMORGAN Page 5 [LOGO] MELLON BANK CORPORATION
MELLON RESIDENTIAL FUNDING CORP. 1998-1 COLLATERAL TABLES
---------------------------------------------------------
<TABLE>
<CAPTION>
PORTFOLIO BY LOAN PURPOSE
- ----------------------------------------------------------------------------------------
NUMBER OF PERCENT OF CURRENT
LOAN PURPOSE(1) LOANS CURRENT BALANCE BALANCE
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C>
Not Identified 572 35,170,388.88 25.59%
Consolidation 1,838 101,062,549.47 73.53%
Personal 18 546,266.01 0.40%
Home Imprvmnt 12 297,488.88 0.22%
Convenience 7 186,908.36 0.14%
Tax/Inv/Edu 5 151,464.35 0.11%
Business 2 34,454.79 0.03%
- ----------------------------------------------------------------------------------------
2,454 137,449,520.74 100.00%
- ----------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PORTFOLIO BY REMAINING TERM
- ----------------------------------------------------------------------------------------
REMAINING TERM PERCENT OF CURRENT
(MONTHS) NUMBER OF LOANS CURRENT BALANCE BALANCE
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1 - 60 40 753,541.11 0.55%
61 - 90 32 967,708.55 0.70%
91 - 120 237 8,034,903.84 5.85%
121 - 150 12 565,234.17 0.41%
151 - 180 2,133 127,128,133.07 92.49%
- ----------------------------------------------------------------------------------------
2,454 137,449,520.74 100.00%
- ----------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PORTFOLIO BY PROPERTY STATE
- ----------------------------------------------------------------------------------------
NUMBER OF PERCENT OF CURRENT
PROPERTY STATE LOANS CURRENT BALANCE BALANCE
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C>
Delaware 21 1,430,085.46 1.04%
District of Columbia 5 330,736.27 0.24%
Georgia 1 42,098.33 0.03%
Illinois 3 132,561.01 0.10%
Indiana 23 1,127,182.77 0.82%
Kentucky 36 1,873,734.45 1.36%
Maryland 137 7,463,028.50 5.43%
New Jersey 219 16,550,651.75 12.04%
North Carolina 31 1,967,859.01 1.43%
Ohio 707 36,790,605.33 26.77%
Pennsylvania 1,020 54,689,665.86 39.79%
Virginia 251 15,051,312.00 10.95%
- ----------------------------------------------------------------------------------------
2,454 137,449,520.74 100.00%
- ----------------------------------------------------------------------------------------
</TABLE>
Additional information is available upon request. Information herein is believed
to be reliable but J.P. Morgan does not warrant its completeness or accuracy.
These materials are subject to change from time to time without notice. Past
performance is not indicative of future results. Any description of the
collateral contained herein supersedes any previous collateral information and
will be superseded by the final prospectus relating to the securities. These
materials are not intended as an offer or solicitation with respect to the
purchase or sale of any security, and have been provided to you for
informational purposes only and may not be relied upon by you in evaluating the
merits of investing in the securities. Any investment decision with respect to
the securities should be made by you based solely upon the information contained
in the final prospectus relating to the securities. No assurance or
representation can be made as to the actual rate or timing of principal payments
or prepayments on any of the collateral or the performance characteristics of
the securities. This information was prepared in reliance on information
regarding the collateral furnished by the seller of the collateral. J.P. Morgan
may hold a position or act as market maker in the financial instruments of any
issuer discussed herein or act as advisor or lender to such issuer. J.P. Morgan
Securities Inc. is a member of SIPC and SFA. Copyright 1998 J.P. Morgan & Co.
Incorporated.
<PAGE> 6
JPMORGAN Page 6 [LOGO] MELLON BANK CORPORATION
MELLON RESIDENTIAL FUNDING CORP. 1998-1 COLLATERAL TABLES (CONT.)
-----------------------------------------------------------------
<TABLE>
<CAPTION>
PORTFOLIO BY COMBINED LTV
- ----------------------------------------------------------------------------------------
NUMBER OF PERCENT OF CURRENT
COMBINED LTV LOANS CURRENT BALANCE BALANCE
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
0.01% - 10.00% 1 27,617.57 0.02%
10.01% - 20.00% 10 169,927.52 0.12%
20.01% - 30.00% 32 1,001,492.96 0.73%
30.01% - 40.00% 54 1,941,004.61 1.41%
40.01% - 50.00% 108 3,971,780.45 2.89%
50.01% - 60.00% 134 5,864,957.47 4.27%
60.01% - 70.00% 238 10,983,520.17 7.99%
70.01% - 80.00% 397 20,402,313.89 14.84%
80.01% - 90.00% 1471 92,280,446.94 67.14%
90.01% - 100.00% 9 806,459.16 0.59%
- ----------------------------------------------------------------------------------------
2,454 137,449,520.74 100.00%
- ----------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PORTFOLIO BY PROPERTY TYPE
- ----------------------------------------------------------------------------------------
PERCENT OF CURRENT
PROPERTY TYPE NUMBER OF LOANS CURRENT BALANCE BALANCE
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C>
Single Family 2,387 134,187,793.78 97.63%
Townhouse 46 2,389,959.98 1.74%
Duplex 5 171,720.89 0.12%
Condomininum 2 70,375.26 0.05%
Other 14 629,670.83 0.46%
- ----------------------------------------------------------------------------------------
2,454 137,449,520.74 100.00%
- ----------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PORTFOLIO BY LIEN POSITION
- ----------------------------------------------------------------------------------------
PERCENT OF CURRENT
LIEN POSITION NUMBER OF LOANS CURRENT BALANCE BALANCE
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C>
First Lien 1,708 112,009,404.58 81.49%
Second Lien 745 25,390,289.84 18.47%
Other 1 49,826.32 0.04%
- ----------------------------------------------------------------------------------------
2,454 137,449,520.74 100.00%
- ----------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PORTFOLIO BY OCCUPANCY TYPE
- ----------------------------------------------------------------------------------------
PERCENT OF CURRENT
OCCUPANCY NUMBER OF LOANS CURRENT BALANCE BALANCE
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C>
Primary 2,409 135,754,169.42 98.77%
Rental 40 1,514,803.81 1.10%
Second Home 3 90,636.77 0.07%
Other 2 89,910.74 0.07%
- ----------------------------------------------------------------------------------------
2,454 137,449,520.74 100.00%
- ----------------------------------------------------------------------------------------
</TABLE>
Additional information is available upon request. Information herein is believed
to be reliable but J.P. Morgan does not warrant its completeness or accuracy.
These materials are subject to change from time to time without notice. Past
performance is not indicative of future results. Any description of the
collateral contained herein supersedes any previous collateral information and
will be superseded by the final prospectus relating to the securities. These
materials are not intended as an offer or solicitation with respect to the
purchase or sale of any security, and have been provided to you for
informational purposes only and may not be relied upon by you in evaluating the
merits of investing in the securities. Any investment decision with respect to
the securities should be made by you based solely upon the information contained
in the final prospectus relating to the securities. No assurance or
representation can be made as to the actual rate or timing of principal payments
or prepayments on any of the collateral or the performance characteristics of
the securities. This information was prepared in reliance on information
regarding the collateral furnished by the seller of the collateral. J.P. Morgan
may hold a position or act as market maker in the financial instruments of any
issuer discussed herein or act as advisor or lender to such issuer. J.P. Morgan
Securities Inc. is a member of SIPC and SFA. Copyright 1998 J.P. Morgan & Co.
Incorporated.
<PAGE> 7
JPMORGAN Page 7 [LOGO] MELLON BANK CORPORATION
MELLON RESIDENTIAL FUNDING CORP. 1998-1 COLLATERAL TABLES (CONT.)
<TABLE>
<CAPTION>
PORTFOLIO BY COUPON
- ----------------------------------------------------------------------------------------
NUMBER OF PERCENT OF
COUPON RANGE LOANS CURRENT BALANCE CURRENT BALANCE
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
7.51% - 8.00% 142 9,553,423.61 6.95%
8.01% - 8.50% 919 61,423,215.18 44.69%
8.51% - 9.00% 752 38,215,194.68 27.80%
9.01% - 9.50% 463 22,989,450.95 16.73%
9.51% - 10.00% 159 4,656,849.61 3.39%
10.01% - 10.50% 14 468,354.06 0.34%
10.51% - 11.50% 5 143,032.65 0.10%
- ----------------------------------------------------------------------------------------
2,454 137,449,520.74 100.00%
- ----------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PORTFOLIO BY CURRENT BALANCE
- ----------------------------------------------------------------------------------------
NUMBER OF PERCENT OF
CURRENT BALANCE RANGE LOANS CURRENT BALANCE CURRENT BALANCE
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1 - 10,000 7 66,112.51 0.05%
10,001 - 20,000 241 3,662,912.03 2.66%
20,001 - 30,000 356 9,111,827.28 6.63%
30,001 - 40,000 343 11,959,365.86 8.70%
40,001 - 50,000 332 14,987,348.62 10.90%
50,001 - 60,000 315 17,265,567.65 12.56%
60,001 - 70,000 209 13,575,708.06 9.88%
70,001 - 80,000 184 13,689,784.14 9.96%
80,001 - 90,000 133 11,221,398.62 8.16%
90,001 - 100,000 81 7,686,016.73 5.59%
100,001 - 125,000 129 14,310,616.61 10.41%
125,001 - 150,000 61 8,243,196.64 6.00%
150,001 - 175,000 34 5,417,691.42 3.94%
175,001 - 200,000 12 2,271,283.79 1.65%
200,001 - 275,000 17 3,980,690.78 2.90%
- ----------------------------------------------------------------------------------------
2,454 137,449,520.74 100.00%
- ----------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MORTGAGE RATES
- ----------------------------------------------------------------------------------------
NUMBER OF LOANS PERCENT OF
MORTGAGE RATE CURRENT BALANCE CURRENT BALANCE
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
7.51 - 8 647 46,065,469.33 33.51%
8.01 - 8.5 509 28,906,114.41 21.03%
8.51 - 9 849 46,235,798.09 33.64%
9.01 - 9.5 304 12,556,227.25 9.14%
9.51 - 10 135 3,222,550.06 2.34%
10.01 - 10.5 9 421,288.56 0.31%
10.51 - 11 1 42,073.04 0.03%
- ----------------------------------------------------------------------------------------
2,454 137,449,520.74 100.00%
- ----------------------------------------------------------------------------------------
</TABLE>
Additional information is available upon request. Information herein is believed
to be reliable but J.P. Morgan does not warrant its completeness or accuracy.
These materials are subject to change from time to time without notice. Past
performance is not indicative of future results. Any description of the
collateral contained herein supersedes any previous collateral information and
will be superseded by the final prospectus relating to the securities. These
materials are not intended as an offer or solicitation with respect to the
purchase or sale of any security, and have been provided to you for
informational purposes only and may not be relied upon by you in evaluating the
merits of investing in the securities. Any investment decision with respect to
the securities should be made by you based solely upon the information contained
in the final prospectus relating to the securities. No assurance or
representation can be made as to the actual rate or timing of principal payments
or prepayments on any of the collateral or the performance characteristics of
the securities. This information was prepared in reliance on information
regarding the collateral furnished by the seller of the collateral. J.P. Morgan
may hold a position or act as market maker in the financial instruments of any
issuer discussed herein or act as advisor or lender to such issuer. J.P. Morgan
Securities Inc. is a member of SIPC and SFA. Copyright 1998 J.P. Morgan & Co.
Incorporated.
