EXECUTION COPY
RESIDENTIAL ASSET MORTGAGE PRODUCTS, INC.,
as Purchaser,
GMAC MORTGAGE CORPORATION,
as Seller and Servicer,
WALNUT GROVE HOME EQUITY LOAN TRUST 2000-A,
as Seller,
GMACM MORTGAGE LOAN TRUST 2000-HE3,
as Issuer,
and
WELLS FARGO BANK MINNESOTA, N.A.,
as Indenture Trustee
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MORTGAGE LOAN PURCHASE AGREEMENT
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Dated as of October 30, 2000
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS...............................................................1
Section 1.1 Definitions...........................................................1
Section 1.2 Other Definitional Provisions.........................................2
ARTICLE II SALE OF MORTGAGE LOANS AND RELATED PROVISIONS.............................2
Section 2.1 Sale of Initial Mortgage Loans........................................2
Section 2.2 Sale of Subsequent HELs...............................................5
Section 2.3 Payment of Purchase Price.............................................8
ARTICLE III REPRESENTATIONS AND WARRANTIES; REMEDIES FOR BREACH.......................9
Section 3.1 Seller Representations and Warranties.................................9
ARTICLE IV SELLER'S COVENANTS.......................................................16
Section 4.1 Covenants of the Seller..............................................16
ARTICLE V SERVICING................................................................16
Section 5.1 Servicing............................................................16
ARTICLE VI INDEMNIFICATION BY THE SELLER WITH RESPECT TO THE MORTGAGE LOANS.........16
Section 6.1 Indemnification with Respect to the Mortgage Loans...................16
Section 6.2 Limitation on Liability of the Seller................................16
ARTICLE VII TERMINATION..............................................................17
Section 7.1 Termination..........................................................17
ARTICLE VIII MISCELLANEOUS PROVISIONS.................................................17
Section 8.1 Amendment............................................................17
Section 8.2 GOVERNING LAW........................................................17
Section 8.3 Notices..............................................................17
Section 8.4 Severability of Provisions...........................................18
Section 8.5 Relationship of Parties..............................................18
Section 8.6 Counterparts.........................................................18
Section 8.7 Further Agreements...................................................18
Section 8.8 Intention of the Parties.............................................18
Section 8.9 Successors and Assigns; Assignment of This Agreement.................19
Section 8.10 Survival.............................................................19
Section 8.11 Third Party Beneficiary..............................................20
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EXHIBIT 1 MORTGAGE LOAN SCHEDULE...........................................................0
EXHIBIT 2 FORM OF SUBSEQUENT TRANSFER AGREEMENT............................................1
EXHIBIT 3 FORM OF ADDITION NOTICE..........................................................2
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This Mortgage Loan Purchase Agreement (the "Agreement"), dated as of
October 30, 2000, is made among GMAC Mortgage Corporation, as seller ("GMACM")
and as servicer (in such capacity, the "Servicer"), Walnut Grove Home Equity
Loan Trust 2000-A, as seller ("WG Trust" and, together with GMACM, each a
"Seller" and collectively, the "Sellers"), Residential Asset Mortgage Products,
Inc., as purchaser (the "Purchaser"), GMACM Mortgage Loan Trust 2000-HE3, as
issuer (the "Issuer"), and Wells Fargo Bank Minnesota, N.A., as indenture
trustee (the "Indenture Trustee").
WITNESSETH:
WHEREAS, GMACM, in the ordinary course of its business acquires and
originates home equity loans and originated all of the home equity loans listed
on the Mortgage Loan Schedule attached as Exhibit 1 hereto (the "Initial
Mortgage Loans");
WHEREAS, GMACM sold a portion of the Initial Mortgage Loans (the "WG
Trust Initial Mortgage Loans"), to Walnut Grove Funding, Inc. ("Walnut Grove"),
pursuant to a Mortgage Loan Purchase Agreement (the "Walnut Grove Purchase
Agreement"), dated as of June 1, 2000, among Walnut Grove, as purchaser, GMACM,
as seller, WG Trust, as Issuer and Bank One, National Association, as trustee
(each date of sale, a "Prior Transfer Date");
WHEREAS, Walnut Grove sold the WG Trust Initial Mortgage Loans to WG
Trust pursuant to a Trust Agreement, dated as of June 1, 2000, between Walnut
Grove, as depositor and Wilmington Trust Company, as owner trustee;
WHEREAS, GMACM owns the Cut-Off Date Principal Balances and the Related
Documents for the portion of Initial Mortgage Loans indicated on the Mortgage
Loan Schedule -A attached as Exhibit 1-A hereto (the "GMACM Initial Mortgage
Loans"), including rights to (a) any property acquired by foreclosure or deed in
lieu of foreclosure or otherwise, and (b) the proceeds of any insurance policies
covering the GMACM Initial Mortgage Loans;
WHEREAS, WG Trust owns the Cut-Off Date Principal Balances and the
Related Documents for the WG Trust Initial Mortgage Loans indicated on the
Mortgage Loan Schedule -B attached as Exhibit 1-B hereto, including rights to
(a) any property acquired by foreclosure or deed in lieu of foreclosure or
otherwise, and (b) the proceeds of any insurance policies covering the WG Trust
Initial Mortgage Loans;
WHEREAS, the parties hereto desire that: (i) GMACM sell the Cut-Off Date
Principal Balances of the GMACM Initial Mortgage Loans to the Purchaser on the
Closing Date pursuant to the terms of this Agreement together with the Related
Documents, (ii) WG Trust sell the Cut-Off Date Principal Balances of the WG
Trust Initial Mortgage Loans to the Purchaser on the Closing Date pursuant to
the terms of this Agreement together with the Related Documents, (iii) GMACM may
sell Subsequent HELs to the Issuer on one or more Subsequent Transfer Dates
pursuant to the terms of the related Subsequent Transfer Agreement, and (iv)
each Seller make certain representations and warranties on the Closing Date and
GMACM make certain representations and warranties on each Subsequent Transfer
Date;
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WHEREAS, pursuant to the Trust Agreement, the Purchaser will sell the
Initial Mortgage Loans and transfer all of its rights under this Agreement to
the Issuer on the Closing Date;
WHEREAS, pursuant to the terms of the Servicing Agreement, the Servicer
will service the Mortgage Loans;
WHEREAS, pursuant to the terms of the Trust Agreement, the Issuer will
issue the Certificates;
WHEREAS, pursuant to the terms of the Indenture, the Issuer will issue the
Notes, secured by the Trust Estate;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions. For all purposes of this Agreement, except as otherwise
expressly provided herein or unless the context otherwise requires, capitalized
terms not otherwise defined herein shall have the meanings assigned to such
terms in the Definitions contained in Appendix A to the indenture dated as of
October 30, 2000 (the "Indenture"), between the Issuer and the Indenture
Trustee, which is incorporated by reference herein. All other capitalized terms
used herein shall have the meanings specified herein.
Section 1.2 Other Definitional Provisions. All terms defined in this Agreement
shall have the defined meanings when used in any certificate or other document
made or delivered pursuant hereto unless otherwise defined therein.
As used in this Agreement and in any certificate or other document made
or delivered pursuant hereto or thereto, accounting terms not defined in this
Agreement or in any such certificate or other document, and accounting terms
partly defined in this Agreement or in any such certificate or other document,
to the extent not defined, shall have the respective meanings given to them
under generally accepted accounting principles. To the extent that the
definitions of accounting terms in this Agreement or in any such certificate or
other document are inconsistent with the meanings of such terms under generally
accepted accounting principles, the definitions contained in this Agreement or
in any such certificate or other document shall control.
The words "hereof," "herein," "hereunder" and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement; Section and Exhibit references
contained in this Agreement are references to Sections and Exhibits in or to
this Agreement unless otherwise specified; the term "including" shall mean
"including without limitation"; "or" shall include "and/or"; and the term
"proceeds" shall have the meaning ascribed thereto in the UCC.
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The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as the feminine and neuter genders of such terms.
Any agreement, instrument or statute defined or referred to herein or in
any instrument or certificate delivered in connection herewith means such
agreement, instrument or statute as from time to time amended, modified or
supplemented and includes (in the case of agreements or instruments) references
to all attachments thereto and instruments incorporated therein; references to a
Person are also to its permitted successors and assigns.
ARTICLE II
SALE OF MORTGAGE LOANS AND RELATED PROVISIONS
Section 2.1 Sale of Initial Mortgage Loans.
(a) GMACM, by the execution and delivery of this Agreement, does hereby sell,
assign, set over, and otherwise convey to the Purchaser, without recourse, all
of its right, title and interest in, to and under the following, and wherever
located: (i) the GMACM Initial Mortgage Loans (including the Cut-Off Date
Principal Balances), all interest accruing thereon, all monies due or to become
due thereon, and all collections in respect thereof received on or after the
Cut-Off Date (other than interest thereon in respect of any period prior to the
Cut-Off Date); (ii) the interest of GMACM in any insurance policies in respect
of the GMACM Initial Mortgage Loans; and (iii) all proceeds of the foregoing.
Such conveyance shall be deemed to be made: with respect to the Cut-Off Date
Principal Balances, as of the Closing Date, subject to the receipt by GMACM of
consideration therefor as provided herein under clause (a) of Section 2.3.
(b) WG Trust, by the execution and delivery of this Agreement, does hereby sell,
assign, set over, and otherwise convey to the Purchaser, without recourse, all
of its right, title and interest in, to and under the following, and wherever
located: (i) the WG Trust Initial Mortgage Loans (including the Cut-Off Date
Principal Balances), all interest accruing thereon, all monies due or to become
due thereon, and all collections in respect thereof received on or after the
Cut-Off Date (other than interest thereon in respect of any period prior to the
Cut-Off Date); (ii) the interest of WG Trust in any insurance policies in
respect of the WG Trust Initial Mortgage Loans; and (iii) all proceeds of the
foregoing. Such conveyance shall be deemed to be made: with respect to the
Cut-Off Date Principal Balances, as of the Closing Date, subject to the receipt
by WG Trust of consideration therefor as provided herein under clause (a) of
Section 2.3.
In addition, the Issuer shall deposit with the Indenture Trustee
from proceeds of the issuance of the Securities on the Closing Date (i) the
Original Pre-Funded Amount for deposit in the Pre-Funding Account and (ii) the
Interest Coverage Amount for deposit in the Capitalized Interest Account.
(c) In connection with the conveyance by GMACM of the GMACM Initial Mortgage
Loans and any Subsequent HELs, GMACM further agrees, at its own expense, on or
prior to the Closing Date with respect to the Principal Balances of the GMACM
Initial Mortgage Loans and on or prior to the related Subsequent Cut-Off Date in
the case of any Subsequent HELs, to indicate in its books and records that the
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GMACM Initial Mortgage Loans have been sold to the Purchaser pursuant to this
Agreement, and, in the case of the Subsequent HELs, to the Issuer pursuant to
the related Subsequent Transfer Agreement, and to deliver to the Purchaser true
and complete lists of all of the Mortgage Loans specifying for each Mortgage
Loan (i) its account number and (ii) its Cut-Off Date Principal Balance or
Subsequent Cut-Off Date Principal Balance. Mortgage Loan Schedule -A, which
forms part of the Mortgage Loan Schedule, shall be marked as Exhibit 1-A to this
Agreement and is hereby incorporated into and made a part of this Agreement.
(d) In connection with the conveyance by WG Trust of the WG Trust Initial
Mortgage Loans, WG Trust further agrees, at its own expense, on or prior to the
Closing Date with respect to the Principal Balances of the WG Trust Initial
Mortgage Loans, to indicate in its books and records that the WG Trust Initial
Mortgage Loans have been sold to the Purchaser pursuant to this Agreement.
GMACM, as Servicer of the WG Trust Initial Mortgage Loans, agrees, and to
deliver to the Purchaser true and complete lists of all of the Mortgage Loans
specifying for each Mortgage Loan (i) its account number and (ii) its Cut-Off
Date Principal Balance. Mortgage Loan Schedule -B, which forms part of the
Mortgage Loan Schedule, shall be marked as Exhibit 1-B to this Agreement and is
hereby incorporated into and made a part of this Agreement.
(e) In connection with the conveyance by GMACM of the GMACM Initial Mortgage
Loans and any Subsequent HELs and the conveyance by WG Trust of the WG Trust
Initial Mortgage Loans, GMACM shall on behalf of the Purchaser deliver to, and
deposit with the Custodian, at least five (5) Business Days before the Closing
Date in the case of an Initial Mortgage Loan, and, on behalf of the Issuer,
three (3) Business Days prior to the related Subsequent Transfer Date in the
case of a Subsequent HEL, with respect to (i) below, or within 90 days of the
Closing Date or the Subsequent Transfer Date, as the case may be, with respect
to (ii) through (v) below, the following documents or instruments with respect
to each related Mortgage Loan of the related Seller:
(i) the original Mortgage Note endorsed without recourse in blank (which
endorsement shall contain either an original signature or a facsimile signature
of an authorized officer of the related Seller) or, with respect to any Mortgage
Loan as to which the original Mortgage Note has been permanently lost or
destroyed and has not been replaced, a Lost Note Affidavit;
(ii) the original Mortgage with evidence of recording thereon, or, if the
original Mortgage has not yet been returned from the public recording office, a
copy of the original Mortgage certified by the related Seller that such Mortgage
has been sent for recording, or a county certified copy of such Mortgage in the
event the recording office keeps the original or if the original is lost;
(iii) assignments (which may be included in one or more blanket assignments if
permitted by applicable law) of the Mortgage in recordable form from GMACM to
"Wells Fargo Bank Minnesota, N.A., as Indenture Trustee under that certain
Indenture dated as of October 30, 2000, for GMACM Mortgage Loan Trust 2000-HE3,
Mortgage Loan-Backed Term Notes" c/o the Servicer at an address specified by the
Servicer;
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(iv) originals of any intervening assignments of the Mortgage from the
originator to GMACM, with evidence of recording thereon, or, if the original of
any such intervening assignment has not yet been returned from the public
recording office, a copy of such original intervening assignment certified by
GMACM that such original intervening assignment has been sent for recording; and
(v) a true and correct copy of each assumption, modification, consolidation or
substitution agreement, if any, relating to such Mortgage Loan.
Within the time period for the review of each Mortgage File set forth in
Section 2.2 of the Custodial Agreement, if a material defect in any Mortgage
File is discovered which may materially and adversely affect the value of the
related Mortgage Loan, or the interests of the Indenture Trustee (as pledgee of
the Mortgage Loans), the Noteholders or the Certificateholders in such Mortgage
Loan, including GMACM's failure to deliver any document required to be delivered
to the Custodian on behalf of the Indenture Trustee (provided, that a Mortgage
File will not be deemed to contain a defect for an unrecorded assignment under
clause (iv) above if GMACM has submitted such assignment for recording pursuant
to the terms of the following paragraph), GMACM shall cure such defect,
repurchase the related Mortgage Loan at the Repurchase Price or substitute an
Eligible Substitute Loan therefor upon the same terms and conditions set forth
in Section 3.1 hereof for breaches of representations and warranties as to the
Mortgage Loans, including that the Seller shall have the option to substitute an
Eligible Substitute Mortgage Loan or Loans for such Mortgage Loan only if such
substitution occurs within two years following the Closing Date.
In instances where an original Mortgage or any original intervening
assignment of Mortgage was not, in accordance with clauses (ii) or (iv) above,
delivered by GMACM or WG Trust to the Custodian contemporaneously with the
execution and delivery of this Agreement, GMACM or WG Trust will deliver or
cause to be delivered the originals or certified copies of such documents to the
Custodian promptly upon receipt thereof.
Upon sale of the Initial Mortgage Loans, the ownership of each Mortgage
Note, each related Mortgage and the contents of the related Mortgage File shall
be vested in the Purchaser and the ownership of all records and documents with
respect to the Initial Mortgage Loans that are prepared by or that come into the
possession of either Seller, as a seller of the Initial Mortgage Loans hereunder
or by GMACM in its capacity as Servicer under the Servicing Agreement shall
immediately vest in the Purchaser, and shall be promptly delivered to the
Servicer in the case of documents in possession of WG Trust and retained and
maintained in trust by GMACM as the Servicer at the will of the Purchaser, in
such custodial capacity only. In the event that any original document held by
GMACM hereunder in its capacity as Servicer is required pursuant to the terms of
this Section to be part of a Mortgage File, such document shall be delivered
promptly to the Custodian. Each Seller's records will accurately reflect the
sale of each Seller's respective Initial Mortgage Loan to the Purchaser.
The Purchaser hereby acknowledges its acceptance of all right, title and
interest to the property conveyed to it pursuant to this Section 2.1.
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(f) The parties hereto intend that the transactions set forth herein constitute
a sale by the Sellers to the Purchaser of each of the Sellers' right, title and
interest in and to their respective Initial Mortgage Loans and other property as
and to the extent described above. In the event the transactions set forth
herein are deemed not to be a sale, each Seller hereby grants to the Purchaser a
security interest in all of such Seller's right, title and interest in, to and
under all accounts, chattel papers, general intangibles, contract rights,
certificates of deposit, deposit accounts, instruments, documents, letters of
credit, money, advices of credit, investment property, goods and other property
consisting of, arising under or related to the Initial Mortgage Loans and such
other property, to secure all of such Seller's obligations hereunder, and this
Agreement shall and hereby does constitute a security agreement under applicable
law. Each Seller agrees to take or cause to be taken such actions and to execute
such documents, including without limitation the filing of any continuation
statements with respect to the UCC-1 financing statements filed with respect to
the Initial Mortgage Loans by the Purchaser on the Closing Date, and any
amendments thereto required to reflect a change in the name or corporate
structure of such Seller or the filing of any additional UCC-1 financing
statements due to the change in the principal office or jurisdiction of
incorporation of such Seller, as are necessary to perfect and protect the
Purchaser's interests in each Initial Mortgage Loan and the proceeds thereof.
Section 2.2 Sale of Subsequent HELs.
(a) Subject to the conditions set forth in paragraphs (b) and (c) below (the
satisfaction of which (other than the conditions specified in paragraphs (b)(i),
(b)(ii), (b)(iii), (b)(vi), (b)(vii) and (c)(iii)) shall be evidenced by an
Officer's Certificate of GMACM dated the date of the related Subsequent Transfer
Date), in consideration of the Issuer's payment of the purchase price provided
for in Section 2.3 on one or more Subsequent Transfer Dates using amounts on
deposit in the Pre-Funding Account, GMACM may, on the related Subsequent
Transfer Date, sell, transfer, assign, set over and convey without recourse to
the Issuer but subject to the other terms and provisions of this Agreement all
of the right, title and interest of GMACM in and to (i) Subsequent HELs
identified on the related Mortgage Loan Schedule attached to the related
Subsequent Transfer Agreement delivered by GMACM on such Subsequent Transfer
Date (ii) all money due or to become due on such Subsequent HEL and after the
related Subsequent Cut-Off Date and (iii) all items with respect to such
Subsequent HELs to be delivered pursuant to Section 2.1 above and the other
items in the related Mortgage Files; provided, however, that GMACM reserves and
retains all right, title and interest in and to principal received and interest
accruing on any Subsequent HEL prior to the related Subsequent Cut-Off Date. Any
transfer to the Issuer by GMACM of Subsequent HELs shall be absolute, and is
intended by the Issuer and GMACM to constitute and to be treated as a sale of
such Subsequent HELs by GMACM to the Issuer. In the event that any such
transaction is deemed not to be a sale, GMACM hereby grants to the Issuer as of
each Subsequent Transfer Date a security interest in all of GMACM's right, title
and interest in, to and under all accounts, chattel papers, general intangibles,
contract rights, certificates of deposit, deposit accounts, instruments,
documents, letters of credit, money, advices of credit, investment property,
goods and other property consisting of, arising under or related to the related
Subsequent HELs and such other property, to secure all of GMACM's obligations
hereunder, and this Agreement shall constitute a security agreement under
applicable law. GMACM agrees to take or cause to be taken such actions and to
execute such documents, including the filing of all necessary UCC-1 financing
statements filed in the State of Delaware and the Commonwealth of Pennsylvania
(which shall be submitted for filing as of the related Subsequent Transfer
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Date), any continuation statements with respect thereto and any amendments
thereto required to reflect a change in the name or corporate structure of GMACM
or the filing of any additional UCC-1 financing statements due to the change in
the principal office of GMACM, as are necessary to perfect and protect the
interests of the Issuer and its assignees in each Subsequent HEL and the
proceeds thereof.
The Issuer on each Subsequent Transfer Date shall acknowledge its
acceptance of all right, title and interest to the related Subsequent HELs and
other property, existing on the Subsequent Transfer Date and thereafter created,
conveyed to it pursuant to this Section 2.2.
The Issuer shall be entitled to all scheduled principal payments due
after each Subsequent Cut-Off Date, all other payments of principal due and
collected after each Subsequent Cut-Off Date, and all payments of interest on
any related Subsequent HELs, minus that portion of any such interest payment
that is allocable to the period prior to the related Subsequent Cut-Off Date. No
scheduled payments of principal due on Subsequent HELs on or before the related
Subsequent Cut-Off Date and collected after such Subsequent Cut-Off Date shall
belong to the Issuer pursuant to the terms of this Agreement.
(b) GMACM may transfer to the Issuer Subsequent HELs and the other property and
rights related thereto described in Section 2.2(a) above during the Pre-Funding
Period, and the Issuer shall cause to be released funds from the Pre-Funding
Account, only upon the satisfaction of each of the following conditions on or
prior to the related Subsequent Transfer Date:
(i) GMACM shall have provided the Indenture Trustee and the Rating Agencies with
a timely Addition Notice substantially in the form of Exhibit 3, which notice
shall be given no later than seven Business Days prior to the related Subsequent
Transfer Date, and shall designate the Subsequent HELs to be sold to the Issuer,
the aggregate Principal Balance of such Subsequent HELs as of the related
Subsequent Cut-Off Date and any other information reasonably requested by the
Indenture Trustee with respect to such Subsequent HELs;
(ii) GMACM shall have delivered to the Indenture Trustee a duly executed
Subsequent Transfer Agreement substantially in the form of Exhibit 2, (A)
confirming the satisfaction of each condition precedent and representations
specified in this Section 2.2(b) and in Section 2.2(c) and in the related
Subsequent Transfer Agreement and (B) including a Mortgage Loan Schedule listing
the Subsequent HELs;
(iii) as of each Subsequent Transfer Date, as evidenced by delivery to the
Indenture Trustee of the Subsequent Transfer Agreement in the form of Exhibit 2,
GMACM shall not be insolvent, made insolvent by such transfer or aware of any
pending insolvency; and
(iv) such sale and transfer shall not result in a material adverse tax
consequence to the Issuer or, due to any action or inaction on the part of GMACM
to the Securityholders.
In addition, GMACM shall have delivered to the Issuer and the Indenture
Trustee an Opinion of Counsel with respect to certain bankruptcy matters
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relating to the transfers of Subsequent HELs, which Opinion of Counsel shall be
substantially in the form of the Opinion of Counsel delivered to the Rating
Agencies and the Indenture Trustee on the Closing Date regarding certain
bankruptcy matters, within 30 days after the end of the Pre-Funding Period
relating to all Subsequent HELs transferred to the Trust during the Pre-Funding
Period and purchased, from funds on deposit in the Pre-Funding Account.
The obligation of the Issuer to purchase a Subsequent HEL on any Subsequent
Transfer Date is subject to the following conditions: (i) each such Subsequent
HEL must satisfy the representations and warranties specified in the related
Subsequent Transfer Agreement and this Agreement; (ii) GMACM will not select
such Subsequent HELs in a manner that it reasonably believes is adverse to the
interests of the Noteholders; (iii) GMACM will deliver to the Indenture Trustee
certain Opinions of Counsel described in Section 2.2(b) and acceptable to the
Indenture Trustee with respect to the conveyance of such Subsequent HELs; and
(iv) as of the related Subsequent Cut-Off Date each Subsequent HEL will satisfy
the following criteria: (A) such Subsequent HEL may not be 30 or more days
contractually delinquent as of the related Subsequent Cut-Off Date; (B) such
Subsequent HEL must be secured by a mortgage in a first or second lien position;
(C) such Subsequent HEL must have a CLTV at origination of no more than 81.50%;
(D) such Subsequent HEL must have an original term to maturity of not more than
360 months; (E) such Subsequent HEL must have a Loan Rate of less than 11.230%;
(F) such Subsequent HEL must have a principal balance not in excess of
$31,750.00; (G) such Subsequent HEL may not have a credit score less than 693;
(H) such Subsequent HEL may not be secured by non-owner occupied investment
properties or secondary residences; (I) such Subsequent HEL must be underwritten
in accordance with a full documentation underwriting program; and (J) following
the purchase of such Subsequent HELs by the Issuer, as of each Subsequent
Cut-Off Date, the Mortgage Loans included in the Trust Estate (by aggregate
Principal Balance) must have the following characteristics: (i) a weighted
average Loan Rate of not less than 11.125%, (ii) may not include balloon loans,
(iii) the percentage of Mortgage Loans secured by single family residences or
residences located in PUDs may not be less than 90.00%, (iv) may not have a
concentration in the State of California in excess of 36.25%, (v) will have a
weighted average credit score (excluding Mortgage Loans for which a credit score
is not available) of at least 694, and (vi) will have a weighted average CLTV at
origination of not more than 87.95%. Subsequent HELs with characteristics
materially varying from those set forth above may be purchased by the Issuer and
included in the Trust Estate provided that (1) the addition of such Subsequent
HELs will not materially affect the aggregate characteristics of the Mortgage
Loans in the Trust Estate, (2) the Servicer has received confirmation from each
Rating Agency that the inclusion of such Mortgage Loans will not cause a Rating
Event and (3) the Servicer has received an Opinion of Counsel that the inclusion
of such Mortgage Loans will not result in an Adverse REMIC Event. GMACM shall
not transfer Subsequent HELs with the intent to mitigate losses on Mortgage
Loans previously transferred.
(c) Within five Business Days after each Subsequent Transfer Date, GMACM shall
deliver to the Rating Agencies and the Indenture Trustee a copy of the updated
Mortgage Loan Schedule reflecting the Subsequent HELs in electronic format (to
be followed by a hard copy).
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Section 2.3 Payment of Purchase Price.
(a) The sale of the Initial Mortgage Loans shall take place on the Closing Date,
subject to and simultaneously with the deposit of the Initial Mortgage Loans
into the Trust Estate, the deposit of the Original Pre-Funded Amount and the
Interest Coverage Amount into the Pre-Funding Account and the Capitalized
Interest Account, respectively, and the issuance of the Securities. The purchase
price (the "Purchase Price") for the GMACM Initial Mortgage Loans to be paid by
the Purchaser to GMACM on the Closing Date shall be an amount equal to
$191,617,286.35 in immediately available funds, together with the Certificates,
in respect of the Cut-Off Date Principal Balances thereof. The Purchase Price
for the WG Trust Initial Mortgage Loans to be paid by the Purchaser to WG Trust
on the Closing Date shall be an amount equal to $269,766,667.10 in immediately
available funds, in respect of the Cut-Off Date Principal Balances thereof. The
Purchase Price paid for any Subsequent HEL by the Indenture Trustee from funds
on deposit in the Pre-Funding Account, at the direction of the Issuer, shall be
one-hundred percent (100%) of the Subsequent Cut-Off Date Principal Balance
thereof (as identified on the Mortgage Loan Schedule attached to the related
Subsequent Transfer Agreement provided by GMACM).
(b) In consideration of the sale of the GMACM Initial Mortgage Loans by GMACM to
the Purchaser on the Closing Date, the Purchaser shall pay to GMACM on the
Closing Date by wire transfer of immediately available funds to a bank account
designated by GMACM, the amount specified above in paragraph (a) for each GMACM
Initial Mortgage Loan; provided, that such payment may be on a net funding basis
if agreed by GMACM and the Purchaser. In consideration of the sale of any
Subsequent HEL by GMACM to the Issuer, the Issuer shall pay to GMACM by wire
transfer of immediately available funds to a bank account designated by GMACM,
the amount specified above in paragraph (a) for each Subsequent HEL.
(c) In consideration of the sale of the WG Trust Initial Mortgage Loans by WG
Trust to the Purchaser on the Closing Date, the Purchaser shall pay to WG Trust
on the Closing Date by wire transfer of immediately available funds to a bank
account designated by WG Trust, the amount specified above in paragraph (a) for
each WG Trust Initial Mortgage Loan; provided, that such payment may be on a net
funding basis if agreed by WG Trust and the Purchaser.
ARTICLE III
REPRESENTATIONS AND WARRANTIES;
REMEDIES FOR BREACH
Section 3.1 GMACM Representations and Warranties. GMACM represents and warrants
to the Purchaser, as of the Closing Date and as of each Subsequent Transfer Date
(or if otherwise specified below, as of the date so specified):
(a) As to GMACM:
(i) GMACM is a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction governing its creation and existence and is
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or will be in compliance with the laws of each state in which any Mortgaged
Property is located to the extent necessary to ensure the enforceability of each
Mortgage Loan;
(ii) GMACM has the power and authority to make, execute, deliver and perform its
obligations under this Agreement and each Subsequent Transfer Agreement and all
of the transactions contemplated under this Agreement and each Subsequent
Transfer Agreement, and has taken all necessary corporate action to authorize
the execution, delivery and performance of this Agreement and each Subsequent
Transfer Agreement;
(iii) GMACM is not required to obtain the consent of any other Person or any
consents, licenses, approvals or authorizations from, or registrations or
declarations with, any governmental authority, bureau or agency in connection
with the execution, delivery, performance, validity or enforceability of this
Agreement or any Subsequent Transfer Agreement, except for such consents,
licenses, approvals or authorizations, or registrations or declarations, as
shall have been obtained or filed, as the case may be;
(iv) The execution and delivery of this Agreement by GMACM and its performance
and compliance with the terms of this Agreement will not violate GMACM's
Certificate of Incorporation or Bylaws or constitute a material default (or an
event which, with notice or lapse of time, or both, would constitute a material
default) under, or result in the material breach of, any material contract,
agreement or other instrument to which GMACM is a party or which may be
applicable to GMACM or any of its assets;
(v) No litigation before any court, tribunal or governmental body is currently
pending, or to the knowledge of GMACM threatened, against GMACM or with respect
to this Agreement or any Subsequent Transfer Agreement that in the opinion of
GMACM has a reasonable likelihood of resulting in a material adverse effect on
the transactions contemplated by this Agreement or any Subsequent Transfer
Agreement;
(vi) Reserved;
(vii) This Agreement and each Subsequent Transfer Agreement constitutes a legal,
valid and binding obligation of GMACM, enforceable against GMACM in accordance
with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect affecting the enforcement of creditors' rights in general
and except as such enforceability may be limited by general principles of equity
(whether considered in a proceeding at law or in equity) or by public policy
with respect to indemnification under applicable securities laws;
(viii) This Agreement constitutes a valid transfer and assignment to the
Purchaser of all right, title and interest of GMACM in and to the GMACM Initial
Mortgage Loans, including the Cut-Off Date Principal Balances with respect to
the GMACM Initial Mortgage Loans, all monies due or to become due with respect
thereto, and all proceeds of such Cut-Off Date Principal Balances with respect
to the GMACM Initial Mortgage Loans; and this Agreement and the related
Subsequent Transfer Agreement, when executed, will constitute a valid transfer
and assignment to the Issuer of all right, title and interest of GMACM in and to
the Subsequent HELs, including the Cut-Off Date Principal Balances of the
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Subsequent HELs, all monies due or to become due with respect thereto, and all
proceeds of such Subsequent Cut-Off Date Principal Balances and such funds as
are from time to time deposited in the Custodial Account (excluding any
investment earnings thereon) as assets of the Trust and all other property
specified in the definition of "Trust" as being part of the corpus of the Trust
conveyed to the Purchaser by GMACM; and
(ix) GMACM is not in default with respect to any order or decree of any court or
any order, regulation or demand of any federal, state, municipal or governmental
agency, which default might have consequences that would materially and
adversely affect the condition (financial or otherwise) or operations of GMACM
or its properties or might have consequences that would materially adversely
affect its performance hereunder;
(b) As to each Initial Mortgage Loan (except as otherwise specified below) as of
the Closing Date, or with respect to each Subsequent HEL as of the related
Subsequent Transfer Date (except as otherwise specified below):
(i) The information set forth in the Mortgage Loan Schedule with respect to each
Mortgage Loan or the Mortgage Loans is true and correct in all material respects
as of the date or dates respecting which such information is initially
furnished;
(ii) With respect to each of the WG Trust Initial Mortgage Loans, as of each
respective Prior Transfer Date: (A) the related Mortgage Note and the Mortgage
had not been assigned or pledged, except for any assignment or pledge that had
been satisfied and released, (B) immediately prior to the assignment of such
Mortgage Loans to Walnut Grove, GMACM had good title thereto and (C) immediately
prior to such assignment, GMACM was the sole owner and holder of the Mortgage
Loan free and clear of any and all liens, encumbrances, pledges, or security
interests (other than, with respect to any HEL in a second lien position, the
lien of the related first mortgage) of any nature and had full right and
authority, under all governmental and regulatory bodies having jurisdiction over
the ownership of the applicable Mortgage Loan, to sell and assign the same
pursuant to the Walnut Grove Purchase Agreement;
(iii) With respect to the GMACM Initial Mortgage Loans: (A) the related Mortgage
Note and the Mortgage have not been assigned or pledged, except for any
assignment or pledge that has been satisfied and released, (B) immediately prior
to the assignment of the Mortgage Loans to the Purchaser, GMACM has good title
thereto and (C) GMACM is the sole owner and holder of the Mortgage Loan free and
clear of any and all liens, encumbrances, pledges, or security interests (other
than, with respect to any Mortgage Loan in a second lien position, the lien of
the related first mortgage) of any nature and has full right and authority,
under all governmental and regulatory bodies having jurisdiction over the
ownership of the applicable Mortgage Loans to sell and assign the same pursuant
to this Agreement or the related Subsequent Transfer Agreement, as applicable;
(iv) To the best of GMACM's knowledge, there is no valid offset, defense or
counterclaim of any obligor under any Mortgage Note or Mortgage;
(v) To the best of GMACM's knowledge, there is no delinquent recording or other
tax or fee or assessment lien against any related Mortgaged Property;
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(vi) To the best of GMACM's knowledge, there is no proceeding pending or
threatened for the total or partial condemnation of the related Mortgaged
Property;
(vii) To the best of GMACM's knowledge, there are no mechanics' or similar liens
or claims which have been filed for work, labor or material affecting the
related Mortgaged Property which are, or may be liens prior or equal to, or
subordinate with, the lien of the related Mortgage, except liens which are fully
insured against by the title insurance policy referred to in clause (xi);
(viii) As of the Cut-Off Date or related Subsequent Cut-Off Date, no Mortgage
Loan was 30 days or more delinquent in payment of principal or interest;
(ix) With respect to the GMACM Initial Mortgage Loans, the related Mortgage File
contain or will contain, in accordance with Section 2.1(c)(ii), each of the
documents and instruments specified to be included therein;
(x) To the best of the GMACM's knowledge, the related Mortgage Note and the
related Mortgage at the time it was made complied in all material respects with
applicable local, state and federal laws;
(xi) A title search or other assurance of title customary in the relevant
jurisdiction was obtained with respect to each Mortgage Loan;
(xii) None of the Mortgaged Properties is a mobile home or a manufactured
housing unit that is not permanently attached to its foundation;
(xiii) As of the Cut-Off Date, no more than approximately 34.62% and 6.49% of
the HELs, by Cut-Off Date Principal Balance, are secured by Mortgaged Properties
located in California and New York, respectively, and no more than approximately
44.42% and 5.24% of the Home Loans, by Cut-Off Date Principal Balance, are
secured by Mortgaged Properties located in California and Florida, respectively;
(xiv) As of the Cut-Off Date or Subsequent Cut-Off Date, the Combined
Loan-to-Value Ratio for each HEL was not in excess of 102%;
(xv) As of the Cut-Off Date or Subsequent Cut-Off Date, the Loan-to-Value Ratio
for each Home Loan was not in excess of 125%, with the exception of one Home
Loan, which had a loan-to-value ratio, calculated by dividing the outstanding
principal balance of the Home Loan as of the Cut-off Date by the appraised value
of the related Mortgaged Property as of the Cut-off Date, of less than 125%;
(xvi) GMACM has not transferred the GMACM Initial Mortgage Loans to the
Purchaser or any Subsequent HELs to the Issuer with any intent to hinder, delay
or defraud any of its creditors;
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(xvii) Reserved;
(xviii) Within a loan type, and except as required by applicable law, each
Mortgage Note and each Mortgage is an enforceable obligation of the related
Mortgagor;
(xix) To the best knowledge of GMACM, the physical property subject to each
Mortgage is free of material damage and is in acceptable repair;
(xx) GMACM has not received a notice of default of any senior mortgage loan
related to a Mortgaged Property which has not been cured by a party other than
the Servicer;
(xxi) If any of the Mortgage Loans are secured by a leasehold interest, with
respect to each leasehold interest: the use of leasehold estates for residential
properties is an accepted practice in the area where the related Mortgaged
Property is located; residential property in such area consisting of leasehold
estates is readily marketable; the lease is recorded and no party is in any way
in breach of any provision of such lease; the leasehold is in full force and
effect and is not subject to any prior lien or encumbrance by which the
leasehold could be terminated or subject to any charge or penalty; and the
remaining term of the lease does not terminate less than ten years after the
maturity date of such Mortgage Loan;
(xxii) None of the Mortgage Loans is a reverse mortgage loan;
(xxiii) No Mortgage Loan has an original term to maturity in excess of 360
months;
(xxiv) All of the HELs are fixed rate and are fully amortizing. As of the
Cut-off Date, the Loan Rates on the HELs range between 7.50% per annum and
14.625% per annum. The weighted average remaining term to stated maturity of the
HELs as of the Cut-off Date is approximately 205 months;
(xxv) 67.33% of the Home Loans are fixed rate, fully amortizing Home Loans with
Loan Rates that range between 9.50% per annum and 12.625% per annum;
(xxvi) 32.67% of the Home Loans are adjustable rate, fully amortizing Home Loans
with Loan Rates that range between 8.875% per annum and 12.950% per annum;
(xxvii) The weighted average remaining term to stated maturity of the Home Loans
as of the Cut-off Date is approximately 346 months;
(xxviii) (A) Each Mortgaged Property consists of a single parcel of real
property with a single family or an individual condominium unit; (B) with
respect to the HELs (a) approximately 5.84% (by Cut-Off Date Principal Balance)
are secured by real property improved by individual condominium units, and (b)
approximately 89.93% (by Cut-Off Date Principal Balance) are secured by real
property with a single family residence erected thereon; and (C) with respect to
the Home Loans (a) approximately 9.20% (by Cut-Off Date Principal Balance) are
secured by real property improved by individual condominium units, and (b)
approximately 90.80% (by Cut-Off Date Principal Balance) are secured by real
property with a single family residence erected thereon;
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(xxix) As of the Cut-Off Date no Initial HEL had a principal balance in excess
of $248,895.62 and no Home Loan had a principal balance in excess of
$491,675.79;
(xxx) No more than approximately 96.16% of the HELs, which are 83.52% the
Initial Mortgage Loans, by aggregate Principal Balance as of the Cut-Off Date,
are secured by second liens; and none of the Home Loans are secured by second or
more junior liens on the Mortgaged Property;
(xxxi) A policy of hazard insurance and flood insurance, if applicable, was
required from the Mortgagor for the Mortgage Loan when the Mortgage Loan was
originated;
(xxxii) Other than with respect to a payment default, there is no material
default, breach, violation or event of acceleration existing under the terms of
any Mortgage Note or Mortgage and, to the best of GMACM's knowledge, no event
which, with notice and expiration of any grace or cure period, would constitute
a material default, breach, violation or event of acceleration under the terms
of any Mortgage Note or Mortgage, and no such material default, breach,
violation or event of acceleration has been waived by GMACM involved in
originating or servicing the related Mortgage Loan;
(xxxiii) To the best knowledge of GMACM, no instrument of release or waiver has
been executed in connection with the Mortgage Loans, and no Mortgagor has been
released, in whole or in part from its obligations in connection therewith;
(xxxiv) With respect to each HEL secured by a second lien, either (a) no consent
for such Mortgage Loan was required by the holder or holders of the related
prior lien, (b) such consent has been obtained and is contained in the related
Mortgage File or (c) no consent for such Mortgage Loan was required by relevant
law;
(xxxv) With respect to each Mortgage Loan, to the extent permitted by applicable
law, the related Mortgage contains a customary provision for the acceleration of
the payment of the unpaid Principal Balance of the Mortgage Loan in the event
the related Mortgaged Property is sold without the prior consent of the
mortgagee thereunder;
(xxxvi) None of the Mortgage Loans are "high cost loans", subject to the Home
Ownership and Equity Protection Act of 1994; and
(xxxvii) With respect to each Mortgage Loan, the Mortgage Loan constitutes a
"qualified mortgage" under Section 860G(a)(3)(A) of the Code and Treasury
Regulation Section 1.860G-2(a)(1).
With respect to this Section 3.1(b), representations made by
GMACM with respect to the WG Trust Initial Mortgage Loans, made as of the
Cut-Off Date or the Closing Date, are made by GMACM in its capacity as Servicer.
Representations made by GMACM with respect to the WG Trust Initial Mortgage
Loans, made as of any other date, are made by GMACM in its capacity as Seller.
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(c) WG Trust Representations and Warranties. WG Trust represents and
warrants to the Purchaser, as of the Closing Date:
(i) As to WG Trust:
(i) WG Trust is a Delaware business trust duly organized, validly existing and
in good standing under the laws of the State of Delaware;
(ii) WG Trust has the power and authority to make, execute, deliver and perform
its obligations under this Agreement and all of the transactions contemplated
under this Agreement, and has taken all necessary action to authorize the
execution, delivery and performance of this Agreement;
(iii) WG Trust is not required to obtain the consent of any other Person or any
consents, licenses, approvals or authorizations from, or registrations or
declarations with, any governmental authority, bureau or agency in connection
with the execution, delivery, performance, validity or enforceability of this
Agreement, except for such consents, licenses, approvals or authorizations, or
registrations or declarations, as shall have been obtained or filed, as the case
may be;
(iv) The execution and delivery of this Agreement by WG Trust and its
performance and compliance with the terms of this Agreement will not violate WG
Trust's organizational documents or constitute a material default (or an event
which, with notice or lapse of time, or both, would constitute a material
default) under, or result in the material breach of, any material contract,
agreement or other instrument to which WG Trust is a party or which may be
applicable to WG Trust or any of its assets;
(v) No litigation before any court, tribunal or governmental body is currently
pending, or to the knowledge of WG Trust threatened, against WG Trust or with
respect to this Agreement that in the opinion of WG Trust has a reasonable
likelihood of resulting in a material adverse effect on the transactions
contemplated by this Agreement;
(vi) This Agreement constitutes a legal, valid and binding obligation of WG
Trust, enforceable against WG Trust in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
affecting the enforcement of creditors' rights in general and except as such
enforceability may be limited by general principles of equity (whether
considered in a proceeding at law or in equity) or by public policy with respect
to indemnification under applicable securities laws;
(vii) This Agreement constitutes a valid transfer and assignment to the
Purchaser of all right, title and interest of WG Trust in and to the WG Trust
Initial Mortgage Loans, including the Cut-Off Date Principal Balances with
respect to the WG Trust Initial Mortgage Loans, all monies due or to become due
with respect thereto, and all proceeds of such Cut-Off Date Principal Balances
with respect to the WG Trust Initial Mortgage Loans; and
(viii) WG Trust is not in default with respect to any order or decree of any
court or any order, regulation or demand of any federal, state, municipal or
governmental agency, which default might have consequences that would materially
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and adversely affect the condition (financial or otherwise) or operations of WG
Trust or its properties or might have consequences that would materially
adversely affect its performance hereunder.
(ii) As to the WG Trust Initial Mortgage Loans:
(i) With respect to the WG Trust Initial Mortgage Loans: (A) The related
Mortgage Note and the Mortgage have not been assigned or pledged, except for any
assignment or pledge that has been satisfied and released, (B) immediately prior
to the assignment of the Mortgage Loans to the Purchaser, WG Trust had good
title thereto and (C) WG Trust is the sole owner and holder of the Mortgage Loan
free and clear of any and all liens, encumbrances, pledges, or security
interests (other than, with respect to any Mortgage Loan in a second lien
position, the lien of the related first mortgage) of any nature and has full
right and authority, under all governmental and regulatory bodies having
jurisdiction over the ownership of the applicable Mortgage Loans to sell and
assign the same pursuant to this Agreement;
(ii) For each WG Trust Initial Mortgage Loan, the related Mortgage File contains
or will contain, in accordance with Section 2.1(c)(ii), each of the documents
and instruments specified to be included therein;
(iii) WG Trust has not transferred the WG Trust Initial Mortgage Loans to the
Purchaser with any intent to hinder, delay or defraud any of its creditors; and
(iv) No instrument of release or waiver has been executed by WG Trust in
connection with the WG Trust Initial Mortgage Loans, and no Mortgagor has been
released by WG Trust, in whole or in part, from its obligations in connection
therewith.
(d) Upon discovery by either Seller or upon notice from the Purchaser,
the Issuer, the Owner Trustee, the Indenture Trustee or the Custodian, as
applicable, of a breach of such Seller's respective representations or
warranties in paragraph (a) or (c)(i) above that materially and adversely
affects the interests of the Securityholders in any Mortgage Loan, GMACM or WG
Trust, as applicable, shall, within 90 days of its discovery or its receipt of
notice of such breach, either (i) cure such breach in all material respects or
(ii) to the extent that such breach is with respect to a Mortgage Loan or a
Related Document, either (A) repurchase such Mortgage Loan from the Issuer at
the Repurchase Price, or (B) substitute one or more Eligible Substitute Loans
for such Mortgage Loan, in each case in the manner and subject to the conditions
and limitations set forth below.
Upon discovery by either Seller or upon notice from the Purchaser, the
Issuer, the Owner Trustee, the Indenture Trustee or the Custodian, as
applicable, of a breach of such Seller's respective representations or
warranties in paragraphs (b) or (c)(ii) above, with respect to any Mortgage
Loan, or upon the occurrence of a Repurchase Event, that materially and
adversely affects the interests of the Securityholders or the Purchaser in such
Mortgage Loan (notice of which shall be given to the Purchaser by the respective
Seller, if it discovers the same), notwithstanding such Seller's lack of
knowledge with respect to the substance of such representation and warranty,
such Seller shall, within 90 days after the earlier of its discovery or receipt
of notice thereof or, if such breach has the effect of making the Mortgage Loan
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fail to be a "qualified mortgage" within the meaning of Section 860G of the
Internal Revenue Code, within 90 days after the discovery thereof by either such
Seller, the Servicer, the Issuer, the Owner Trustee, the Indenture Trustee or
the Purchaser, either cure such breach or Repurchase Event in all material
respects or either (i) repurchase such Mortgage Loan from the Issuer at the
Repurchase Price, or (ii) substitute one or more Eligible Substitute Loans for
such Mortgage Loan, in each case in the manner and subject to the conditions set
forth below; provided that the Seller shall have the option to substitute an
Eligible Substitute Mortgage Loan or Loans for such Mortgage Loan only if such
substitution occurs within two years following the Closing Date. The Repurchase
Price for any such Mortgage Loan repurchased by such Seller shall be deposited
or caused to be deposited by the Servicer into the Custodial Account. Upon
discovery by the Purchaser, the Servicer, the Issuer, the Owner Trustee or the
Indenture Trustee of any breach described in this Section 3.1(d), such party
shall give prompt written notice thereof to GMACM and, in the case of the WG
Trust Initial Mortgage Loans, to WG Trust.
In the event that either Seller elects to substitute an Eligible
Substitute Loan or Loans for a Deleted Loan pursuant to this Section 3.1, such
Seller shall deliver to the Custodian on behalf of the Issuer, with respect to
such Eligible Substitute Loan or Loans, the original Mortgage Note and all other
documents and agreements as are required by Section 2.1(c), with the Mortgage
Note endorsed as required by Section 2.1(c). No substitution will be made in any
calendar month after the Determination Date for such month. Monthly Payments due
with respect to Eligible Substitute Loans in the month of substitution shall not
be part of the Trust Estate and will be retained by the Servicer and remitted by
the Servicer to such Seller on the next succeeding Payment Date, provided that a
payment equal to the applicable Monthly Payment for such month in respect of the
Deleted Loan has been received by the Issuer. For the month of substitution,
distributions to the Note Payment Account pursuant to the Servicing Agreement
will include the Monthly Payment due on a Deleted Loan for such month and
thereafter such Seller shall be entitled to retain all amounts received in
respect of such Deleted Loan. The Servicer shall amend or cause to be amended
the Mortgage Loan Schedule to reflect the removal of such Deleted Loan and the
substitution of the Eligible Substitute Loan or Loans and the Servicer shall
deliver the amended Mortgage Loan Schedule to the Owner Trustee and the
Indenture Trustee. Upon such substitution, the Eligible Substitute Loan or Loans
shall be subject to the terms of this Agreement and the Servicing Agreement in
all respects, such Seller shall be deemed to have made the representations and
warranties with respect to the Eligible Substitute Loan contained herein set
forth in Section 3.1(b) (other than clauses (xiii), (xiv), (xxiv), (xxv),
(xxvi), (xxvii), (xxviii) (B) and (C)and (xxx) thereof), with respect to GMACM,
or the representations and warranties set forth in Section 3.1(c), with respect
to WG Trust, each as of the date of substitution and a representation and
warranty that each Mortgage Loan so substituted is an Eligible Substitute Loan
as of the date of substitution, and such Seller shall be obligated to repurchase
or substitute for any Eligible Substitute Loan as to which a Repurchase Event
has occurred as provided herein. In connection with the substitution of one or
more Eligible Substitute Loans for one or more Deleted Loans, the Servicer shall
determine the amount (such amount, a "Substitution Adjustment Amount"), if any,
by which the aggregate principal balance of all such Eligible Substitute Loans
as of the date of substitution is less than the aggregate principal balance of
all such Deleted Loans (after application of the principal portion of the
Monthly Payments due in the month of substitution that are to be distributed to
the Note Payment Account in the month of substitution). Such Seller shall
deposit the amount of such shortfall into the Custodial Account on the date of
substitution, without any reimbursement therefor.
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Upon receipt by the Indenture Trustee on behalf of the Issuer and the
Custodian of written notification, signed by a Servicing Officer, of the deposit
of such Repurchase Price or of such substitution of an Eligible Substitute Loan
(together with the complete related Mortgage File) and deposit of any applicable
Substitution Adjustment Amount as provided above, the Custodian, on behalf of
the Indenture Trustee, shall release to such Seller the related Mortgage File
for the Mortgage Loan being repurchased or substituted for and the Indenture
Trustee on behalf of the Issuer shall execute and deliver such instruments of
transfer or assignment prepared by the Servicer, in each case without recourse,
as shall be necessary to vest in such Seller or its designee such Mortgage Loan
released pursuant hereto and thereafter such Mortgage Loan shall not be an asset
of the Issuer.
It is understood and agreed that the obligation of each Seller to cure
any breach, or to repurchase or substitute for any Mortgage Loan as to which
such a breach has occurred and is continuing, shall constitute the sole remedy
respecting such breach available to the Purchaser, the Issuer, the
Certificateholders (or the Owner Trustee on behalf of the Certificateholders)
and the Noteholders (or the Indenture Trustee on behalf of the Noteholders)
against such Seller.
It is understood and agreed that the representations and warranties set
forth in this Section 3.1 shall survive delivery of the respective Mortgage
Files to the Issuer or the Custodian.
ARTICLE IV
SELLERS' COVENANTS
Section 4.1 Covenants of the Sellers. Each Seller hereby covenants that, except
for the transfer hereunder and, with respect to GMACM, as of any Subsequent
Transfer Date, neither Seller will sell, pledge, assign or transfer to any other
Person, or grant, create, incur or assume any Lien on any Mortgage Loan, or any
interest therein. Each Seller shall notify the Issuer (in the case of the
Initial Mortgage Loans, as assignee of the Purchaser), of the existence of any
Lien (other than as provided above) on any Mortgage Loan immediately upon
discovery thereof; and each Seller shall defend the right, title and interest of
the Issuer (in the case of the Initial Mortgage Loans, as assignee of the
Purchaser) in, to and under the Mortgage Loans against all claims of third
parties claiming through or under such Seller; provided, however, that nothing
in this Section 4.1 shall be deemed to apply to any Liens for municipal or other
local taxes and other governmental charges if such taxes or governmental charges
shall not at the time be due and payable or if either Seller shall currently be
contesting the validity thereof in good faith by appropriate Proceedings.
ARTICLE V
SERVICING
Section 5.1 Servicing. GMACM shall service the Mortgage Loans pursuant to the
terms and conditions of the Servicing Agreement and the Program Guide and shall
service the Mortgage Loans directly or through one or more sub-servicers in
accordance therewith.
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ARTICLE VI
INDEMNIFICATION BY THE SELLERS
WITH RESPECT TO THE MORTGAGE LOANS
Section 6.1 Limitation on Liability of the Sellers. None of the directors,
officers, employees or agents of either GMACM or WG Trust shall be under any
liability to the Purchaser, it being expressly understood that all such
liability is expressly waived and released as a condition of, and as
consideration for, the execution of this Agreement and any Subsequent Transfer
Agreement. Except as and to the extent expressly provided in the Servicing
Agreement, GMACM and WG Trust shall not be under any liability to the Issuer,
the Owner Trustee, the Indenture Trustee or the Securityholders. GMACM, WG Trust
and any director, officer, employee or agent of GMACM or WG Trust, 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.
ARTICLE VII
TERMINATION
Section 7.1 Termination. The obligations and responsibilities of the parties
hereto shall terminate upon the termination of the Trust Agreement.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
Section 8.1 Amendment. This Agreement may be amended from time to time by the
parties hereto by written agreement, provided that the Servicer and the
Indenture Trustee shall have received an Opinion of Counsel to the effect that
such amendment will not result in an Adverse REMIC Event.
Section 8.2 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.
Section 8.3 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 GMACM:
GMAC Mortgage Corporation
100 Witmer Road
Horsham, Pennsylvania 19044
Attention: Barry Bier, Senior Vice President
Re: GMACM Mortgage Loan Trust 2000-HE3;
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(ii) if to WG Trust:
Walnut Grove Home Equity Loan Trust
2000-A
c/o Wilmington Trust Company
1100 North Market Street
Wilmington, Delaware 19890
Attention: Walnut Grove Home Equity Loan
Trust 2000-A
Re:GMACM Mortgage Loan Trust 2000-HE3;
(iii) if to the Purchaser:
Residential Asset Mortgage Products, Inc.
8400 Normandale Lake Boulevard
Minneapolis, Minnesota 55437
Attention:President
Re: GMACM Mortgage Loan Trust 2000-HE3;
(iv) if to the Indenture Trustee:
Wells Fargo Bank Minnesota, N.A.
11000 Broken Land Parkway
Columbia, Maryland 21044
Attention: GMACM Mortgage Loan Trust 2000-HE3; or
(v) if to the Issuer:
c/o Wilmington Trust Company, as Owner Trustee
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Re: GMACM Mortgage Loan Trust 2000-HE3;
or, with respect to any of the foregoing Persons, at such other address as may
hereafter be furnished to the other foregoing Persons in writing.
Section 8.4 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 of enforceability of
the other provisions of this Agreement.
Section 8.5 Relationship of Parties. Nothing herein contained shall be deemed or
construed to create a partnership or joint venture among the parties hereto, and
the services of the GMACM shall be rendered as an independent contractor and not
as agent for the Purchaser.
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Section 8.6 Counterparts. This Agreement may be executed in any number of
counterparts, each of which, when so executed, shall be deemed to be an original
and such counterparts, together, shall constitute one and the same agreement.
Section 8.7 Further Agreements. The parties hereto each agree to execute and
deliver to the other such additional documents, instruments or agreements as may
be necessary or appropriate to effectuate the purposes of this Agreement.
Section 8.8 Intention of the Parties. It is the intention of the parties hereto
that the Purchaser will be purchasing on the Closing Date, and the Sellers will
be selling on the Closing Date, the Initial Mortgage Loans, rather than the
Purchaser providing a loan to the Sellers secured by the Initial Mortgage Loans
on the Closing Date; and that the Issuer will be purchasing on each Subsequent
Transfer Date, and GMACM will be selling on each Subsequent Transfer Date, the
related Subsequent HELs, rather than the Issuer providing a loan to GMACM
secured by the related Subsequent HELs on each Subsequent Transfer Date.
Accordingly, the parties hereto each intend to treat this transaction for
federal income tax purposes as (i) a sale by the Sellers, and a purchase by the
Purchaser, of the Initial Mortgage Loans on the Closing Date and (ii) a sale by
GMACM, and a purchase by the Issuer, of the related Subsequent HELs on each
Subsequent Transfer Date. The Purchaser and the Issuer shall each have the right
to review the Mortgage Loans and the Related Documents to determine the
characteristics of the Mortgage Loans which will affect the federal income tax
consequences of owning the Mortgage Loans, and each Seller shall cooperate with
all reasonable requests made by the Purchaser or the Issuer in the course of
such review.
Section 8.9 Successors and Assigns; Assignment of This Agreement.
(a) This Agreement shall bind and inure to the benefit of and be enforceable by
the parties hereto and their respective permitted successors and assigns. The
obligations of each Seller under this Agreement cannot be assigned or delegated
to a third party without the consent of the Purchaser (and the Issuer with
respect to the transfer of any Subsequent HELs), which consent shall be at the
Purchaser's sole discretion (and the Issuer's sole discretion with respect to
the transfer of any Subsequent HELs); provided, that each Seller may assign its
obligations hereunder to any Affiliate of such Seller, to any Person succeeding
to the business of such Seller, to any Person into which such Seller is merged
and to any Person resulting from any merger, conversion or consolidation to
which such Seller is a party. The parties hereto acknowledge that (i) the
Purchaser is acquiring the Initial Mortgage Loans for the purpose of
contributing them to the GMACM Mortgage Loan Trust 2000-HE3 and (ii) the Issuer
is acquiring the Subsequent HELs for the purpose of pledging the Subsequent HELs
to the Indenture Trustee for the benefit of the Noteholders.
(b) As an inducement to the Purchaser and the Issuer to purchase the Initial
Mortgage Loans and to the Issuer to purchase any Subsequent HELs, each Seller
acknowledges and consents to (i) the assignment by the Purchaser to the Issuer
of all of the Purchaser's rights against each Seller pursuant to this Agreement
insofar as such rights relate to the Initial Mortgage Loans transferred to the
Issuer and to the enforcement or exercise of any right or remedy against either
Seller pursuant to this Agreement by the Issuer, (ii) the enforcement or
exercise of any right or remedy against either Seller pursuant to this Agreement
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by or on behalf of the Issuer and (iii) the Issuer's pledge of its interest in
this Agreement to the Indenture Trustee and the enforcement by the Indenture
Trustee of any such right or remedy against either Seller following an Event of
Default under the Indenture. Such enforcement of a right or remedy by the
Issuer, the Owner Trustee or the Indenture Trustee, as applicable, shall have
the same force and effect as if the right or remedy had been enforced or
exercised by the Purchaser or the Issuer directly.
Section 8.10 Survival. The representations and warranties made herein by each
Seller and the provisions of Article VI hereof shall survive the purchase of the
Initial Mortgage Loans hereunder and any transfer of Subsequent HELs pursuant to
this Agreement and the related Subsequent Transfer Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused their names to be
signed to this Mortgage Loan Purchase Agreement by their respective officers
thereunto duly authorized as of the day and year first above written.
RESIDENTIAL ASSET MORTGAGE PRODUCTS, INC., as Purchaser
By: /s/ Patricia C. Taylor
Name: Patricia C. Taylor
Title: Vice President
GMAC MORTGAGE CORPORATION,
as Seller and Servicer
By: /s/ Thomas J. O'Hara
Name: Thomas J. O'Hara
Title: Vice President
WALNUT GROVE HOME EQUITY LOAN TRUST 2000-A, as Seller
By: WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as
Owner Trustee
By: /s/ Anita Dallago
Name: Anita Dallago
Title: Financial Services Officer
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GMACM MORTGAGE LOAN TRUST 2000-HE3, as Issuer
By: WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as
Owner Trustee
By: /s/ Anita Dallago
Name: Anita Dallago
Title: Financial Services Officer
WELLS FARGO BANK MINNESOTA, N.A., as Indenture Trustee
By: /s/ Peter A. Gobell
Name: Peter A. Gobell
Title: Assistant Vice President
24
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EXHIBIT 1
MORTGAGE LOAN SCHEDULE
[TO BE PROVIDED UPON REQUEST]
25
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EXHIBIT 2
FORM OF SUBSEQUENT TRANSFER AGREEMENT
Pursuant to this Subsequent Transfer Agreement No. (the "Agreement"),
dated as of , , between GMAC Mortgage Corporation, as seller (the "Seller"), and
GMACM Mortgage Loan Trust 2000-HE3, as issuer (the "Issuer"), and pursuant to
the loan purchase agreement dated as of October 30, 2000 (the "Mortgage Loan
Purchase Agreement"), among the Seller, as a seller and servicer, Walnut Grove
Home Equity Loan Trust 2000-A, as a seller, Residential Asset Mortgage Products,
Inc., as purchaser (the "Purchaser"), the Issuer and Wells Fargo Bank Minnesota,
N.A., as Indenture Trustee (the "Indenture Trustee"), the Seller and the Issuer
agree to the sale by the Seller and the purchase by the Issuer of the mortgage
loans listed on the attached Schedule of Subsequent HELs (the "Subsequent
HELs").
Capitalized terms used and not defined herein have their respective
meanings as set forth in Appendix A to the indenture dated as of October 30,
2000, between the Issuer and the Indenture Trustee, which meanings are
incorporated by reference herein. All other capitalized terms used herein shall
have the meanings specified herein.
Section 1. Sale of Subsequent HELs.
(a) The Seller does hereby sell, transfer, assign, set over and convey
to the Issuer, without recourse, all of its right, title and interest in and to
the Subsequent HELs, all principal received and interest accruing on the
Subsequent HELs on and after the Subsequent Cut-Off Date, all monies due or to
become due relating to such Subsequent HELs and all items with respect to the
Subsequent HELs to be delivered pursuant to Section 2.2 of the Mortgage Loan
Purchase Agreement; provided, however, that the Seller reserves and retains all
right, title and interest in and to principal received and interest accruing on
the Subsequent HELs prior to the Subsequent Cut-Off Date. The Seller,
contemporaneously with the delivery of this Agreement, has delivered or caused
to be delivered to the Indenture Trustee each item set forth in Section 2.2 of
the Mortgage Loan Purchase Agreement.
The transfer to the Issuer by the Seller of the Subsequent HELs
identified on the Mortgage Loan Schedule shall be absolute and is intended by
the parties hereto to constitute a sale by the Seller to the Issuer on the
Subsequent Transfer Date of all the Seller's right, title and interest in and to
the Subsequent HELs, and other property as and to the extent described above,
and the Issuer hereby acknowledges such transfer. In the event the transactions
set forth herein shall be deemed not to be a sale, the Seller hereby grants to
the Issuer as of the Subsequent Transfer Date a security interest in all of the
Seller's right, title and interest in, to and under all accounts, chattel
papers, general intangibles, contract rights, certificates of deposit, deposit
accounts, instruments, documents, letters of credit, money, advices of credit,
investment property, goods and other property consisting of, arising under or
related to the Subsequent HELs, and such other property, to secure all of the
Issuer's obligations hereunder, and this Agreement shall constitute a security
agreement under applicable law. The Seller agrees to take or cause to be taken
such actions and to execute such documents, including without limitation the
filing of all necessary UCC-1 financing statements filed in the State of
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Delaware and the Commonwealth of Pennsylvania (which shall be submitted for
filing as of the Subsequent Transfer Date), any continuation statements with
respect thereto and any amendments thereto required to reflect a change in the
name or corporate structure of the Seller or the filing of any additional UCC-1
financing statements due to the change in the principal office of the Seller, as
are necessary to perfect and protect the Issuer's interests in each Subsequent
HEL and the proceeds thereof.
(b) The expenses and costs relating to the delivery of the Subsequent
HELs, this Agreement and the Mortgage Loan Purchase Agreement shall be borne by
the Seller.
(c) Additional terms of the sale are set forth on Attachment A hereto.
Section 2. Representations and Warranties; Conditions Precedent.
(a) The Seller hereby affirms the representations and warranties set
forth in Section 3.1 of the Mortgage Loan Purchase Agreement that relate to the
Seller or the Subsequent HELs as of the date hereof. The Seller hereby confirms
that each of the conditions set forth in Section 2.2(b) of the Mortgage Loan
Purchase Agreement are satisfied as of the date hereof and further represents
and warrants that each Subsequent HEL complies with the requirements of this
Agreement and Section 2.2(c) of the Mortgage Loan Purchase Agreement.
(b) The Seller is solvent, is able to pay its debts as they become due
and has capital sufficient to carry on its business and its obligations
hereunder; it will not be rendered insolvent by the execution and delivery of
this Instrument or by the performance of its obligations hereunder nor is it
aware of any pending insolvency; no petition of bankruptcy (or similar
insolvency proceeding) has been filed by or against the Seller prior to the date
hereof.
(c) All terms and conditions of the Mortgage Loan Purchase Agreement
relating to the Subsequent HELs are hereby ratified and confirmed; provided,
however, that in the event of any conflict the provisions of this Agreement
shall control over the conflicting provisions of the Mortgage Loan Purchase
Agreement.
Section 3. Recordation of Instrument. To the extent permitted by
applicable law or a memorandum thereof if permitted under applicable law, this
Agreement is subject to recordation in all appropriate public offices for real
property records in all of the counties or other comparable jurisdictions in
which any or all of the properties subject to the related Mortgages are
situated, and in any other appropriate public recording office or elsewhere,
such recordation to be effected by the Servicer at the Noteholders' expense on
direction of the Majority Noteholders, but only when accompanied by an Opinion
of Counsel to the effect that such recordation materially and beneficially
affects the interests of the Noteholders or is necessary for the administration
or servicing of the Subsequent HELs.
Section 4. GOVERNING LAW. THIS INSTRUMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.
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Section 5. Counterparts. This Instrument may be executed in counterparts,
each of which, when so executed, shall be deemed to be an original and together
shall constitute one and the same instrument.
Section 6. Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the Seller and the Issuer and their respective
successors and assigns.
GMAC MORTGAGE CORPORATION,
as Seller
By:
Name:
Title:
GMACM MORTGAGE LOAN TRUST 2000-HE3, as Issuer
By: WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as
Owner Trustee
By:
Name:
Title:
Attachments
A. Additional terms of sale.
B. Schedule of Subsequent HELs.
C. Seller's Officer's Certificate.
D. Seller's Officer's Certificate.
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GMACM MORTGAGE LOAN TRUST 2000-HE3
ATTACHMENT A TO FORM OF SUBSEQUENT TRANSFER AGREEMENT
------------, ----
A.
1. Subsequent Cut-Off Date:
2. Pricing Date:
3. Subsequent Transfer Date:
4. Aggregate Principal Balance of the Subsequent HELs as of the
Subsequent Cut-Off Date:
5. Purchase Price: 100.00%
B.
As to all Subsequent HELs:
1. Longest stated term to maturity: months
----------
2. Minimum Loan Rate: %
----------
3. Maximum Loan Rate: %
----------
4. WAC of all Subsequent HELs: %
----------
5. WAM of all Subsequent HELs: %
----------
6. Largest Principal Balance: $
7. Non-owner occupied Mortgaged Properties: %
----------
8. California zip code concentrations: % and %
---- ----
9. Condominiums: %
----------
10. Single-family: %
----------
11. Weighted average term since origination: %
----------
12. Principal balance of Subsequent HELs with respect to which the $
Mortgagor is an employee of GMACM or an affiliate of GMACM:
13. Number of Subsequent HELs with respect to which the Mortgagor
is an employee of GMACM or an affiliate of GMACM:
<PAGE>
EXHIBIT 3
FORM OF ADDITION NOTICE
DATE:
Wells Fargo Bank Minnesota, N.A. Fitch, Inc.
11000 Broken Land Parkway One State Street Plaza
Columbia, Maryland 21044 New York, New York 10004
Standard & Poor's, a division of The [Wilmington Trust Company
McGraw-Hill Companies, Inc. 1100 North Market Street
26 Broadway Wilmington, Delaware 19890]
New York, New York 10004-1064
Re: GMACM Mortgage Loan Trust 2000-HE3
Ladies and Gentlemen:
Pursuant to Section 2.2 of the mortgage loan purchase agreement dated as of
October 30, 2000 (the "Purchase Agreement"), among GMAC Mortgage Corporation, as
Seller and Servicer, Walnut Grove Home Equity Loan Trust 2000-A, as Seller,
Residential Asset Mortgage Products, Inc., as Purchaser, GMACM Mortgage Loan
Trust 2000-HE3, as Issuer and Wells Fargo Bank Minnesota, N.A., as Indenture
Trustee, the Seller has designated the Subsequent HELs identified on the
Mortgage Loan Schedule attached hereto to be sold to the Issuer on _____,___,
with an aggregate Principal Balance of $_____________. Capitalized terms not
otherwise defined herein have the meaning set forth in the Appendix A to the
indenture dated as of October 30, 2000, between the Issuer and the Indenture
Trustee.
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Please acknowledge your receipt of this notice by countersigning the
enclosed copy in the space indicated below and returning it to the attention of
the undersigned.
Very truly yours,
GMAC MORTGAGE CORPORATION,
as Seller
By:
Name:
Title:
ACKNOWLEDGED AND AGREED:
WELLS FARGO BANK MINNESOTA, N.A.,
as Indenture Trustee
By:
Name:
Title:
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