STRUCTURED ASSET SECURITIES CORP, S-3, 1998-03-06

STRUCTURED ASSET SECURITIES CORP
S-3, 1998-03-06
ASSET-BACKED SECURITIES

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As filed with the Securities and Exchange Commission on March 6, 1998
Registration No. 333-
- --------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

--------------------
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933

------------------
STRUCTURED ASSET SECURITIES CORPORATION
(Exact name of registrant as specified in its charter)

DELAWARE 74-74-2440850
(STATE OR OTHER JURISDICTION OF (I.R.S. Employer Identification No.)
INCORPORATION OR ORGANIZATION)

200 VESEY STREET
NEW YORK, NEW YORK 10285
(212) 526-7000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
THEODORE P. JANULIS
STRUCTURED ASSET SECURITIES CORPORATION
200 VESEY STREET
NEW YORK, NEW YORK 10285
(212) 526-5594
(NAME, ADDRESS, INCLUDING ZIP CODE AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)

-------------------------
COPIES TO:

JOHN ARNHOLZ, ESQ. SCOTT KIMMEL, ESQ.
BROWN & WOOD LLP LEHMAN BROTHERS INC.
815 CONNECTICUT AVENUE, N.W. 200 VESEY STREET
SUITE 701 NEW YORK, NEW YORK 10285
WASHINGTON, D.C. 20006

-------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this Registration Statement.

-------------------------
If any securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended, check the following box. /x/

CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
Amount Being Proposed Maximum Proposed Maximum
Title of Securities Being Registered Offering Price Aggregate Amount of
Registered Per Unit(1) Offering Registration
Price(1) Fee
<S> <C> <C> <C> <C>
Mortgage Pass-Through $5,000,000,000 100% $5,000,000,000 $1,475,000
Certificates

</TABLE>

(1) Estimated solely for the purpose of calculating the registration fee.

Pursuant to Rule 429 under the Securities Act of 1933, the prospectus
which is part of this Registration Statement is a combined prospectus and
includes all the information currently required in a prospectus relating to
securities covered by Registration Statement No. 33-99598 previously filed by
the Registrant.
_________________________________________

The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933, as amended, or until the
Registration Statement shall become effective on such date as the Commission,
acting pursuant to said Section 8(a), may determine.

SUBJECT TO COMPLETION, DATED [ ]

PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED [ ])

$[ ] (Approximate)
------------
Structured Asset Securities Corporation
Mortgage Pass-Through Certificates, Series [ ]

[ ]

[Servicer/Master Servicer]
_______________

The Structured Asset Securities Corporation Mortgage Pass-Through
Certificates, Series [ ] (the "Certificates") will evidence, in the
aggregate, the entire beneficial ownership interest in a trust fund (the
"Trust Fund") consisting primarily of a pool (the "Mortgage Pool") of
[adjustable/fixed rate, conventional, first lien) residential mortgage loans
(the "Mortgage Loans") to be deposited by Structured Asset Securities
Corporation (the "Depositor") into the Trust Fund for the benefit of
Certificateholders. The Mortgage Loans will be sold by Lehman Capital, A
Division of Lehman Brothers Holdings Inc. (the "Seller" or "Lehman Capital"),
to the Depositor on the date of the initial issuance of the Certificates.
Certain characteristics of the Mortgage Loans are described herein under
"DESCRIPTION OF THE MORTGAGE POOL."

FOR A DISCUSSION OF CERTAIN SIGNIFICANT FACTORS AFFECTING INVESTMENTS IN
THE OFFERED CERTIFICATES, SEE "RISK FACTORS" HEREIN AT PAGE S-[ ] AND IN THE
PROSPECTUS AT PAGE [ ].

THE CERTIFICATES DO NOT REPRESENT AN INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE SELLER, THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE LOANS WILL BE INSURED OR
GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY OR BY THE DEPOSITOR,
THE SELLER, THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES OR BY ANY OTHER
PERSON OR ENTITY.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

<TABLE>
<CAPTION>
CLASS CERTIFICATE CERTIFICATE
CLASS PRINCIPAL AMOUNT(1) INTEREST RATE CUSIP NUMBER
<S> <C> <C> <C>
$

</TABLE>

(1) Approximate.

The [ ] Certificates (the "Offered
Certificates") will be purchased from the Depositor by Lehman Brothers Inc.
(the "Underwriter") and will be offered by the Underwriter from time to time
in negotiated transactions or otherwise at varying prices to be determined at
the time of sale. Proceeds to the Depositor from the sale of the Offered
Certificates will be approximately [ ]% of the aggregate initial Certificate
Principal Amount thereof, plus accrued interest thereon from the Cut-off
Date, before deducting expenses payable by the Depositor.

The Offered Certificates are offered by the Underwriter, subject to
prior sale, withdrawal, cancellation or modification of the offer without
notice, to delivery to and acceptance by the Underwriter and to certain
further conditions. It is expected that the Class [ ] Certificates will be
delivered in book-entry form through the Same-Day Funds Settlement System of
The Depository Trust Company on or about [ ]. It is expected
that the Class [ ] Certificates will be delivered in
certificated form at the offices of Lehman Brothers Inc., New York, New York
on or about [ ].
_______________

LEHMAN BROTHERS

The date of this Prospectus Supplement is [ ]
[The Certificates will consist of the Class [ ]
Certificates (the "Senior Certificates") and the Class [ ],
Certificates (the "Subordinate Certificates"). Only the Class [
] Certificates are offered hereby.)

There is currently no secondary market for the Offered Certificates. The
Underwriter intends to make a secondary market in the Offered Certificates
but has no obligation to do so. There can be no assurance that a secondary
market for the Offered Certificates will develop or, if it does develop, that
it will continue. See "RISK FACTORS -- Limited Liquidity" herein and in the
Prospectus.

Distributions on the Offered Certificates will be made on the [ ] day
of each month or, if such [ ] day is not a Business Day, on the next
succeeding Business Day, commencing in [ ] (each, a "Distribution
Date"). As more fully described herein, interest on the Offered Certificates
will be calculated on the basis of the Certificate Principal Amounts thereof
and the Certificate Interest Rate.

[The Class [ ] Certificates are subordinate to the
Senior Certificates to the extent described herein. Investors should consider
that, as a result of such subordination, the yields to maturity on the Class
[ ] Certificates will be sensitive, in varying degrees (and
will each be more sensitive than the yields to maturity on the Senior
Certificates), to delinquencies and losses on the Mortgage Loans.]

THE CLASS [ ] CERTIFICATES MAY NOT BE TRANSFERRED TO
PLANS (AS DEFINED HEREIN), EXCEPT AS DESCRIBED HEREIN. [THE CLASS R
CERTIFICATE (THE "RESIDUAL CERTIFICATE") MAY NOT BE TRANSFERRED TO A PLAN AND
IS SUBJECT TO ADDITIONAL TRANSFER RESTRICTIONS AS DESCRIBED HEREIN. SEE
"ERISA CONSIDERATIONS" AND "CERTAIN FEDERAL INCOME TAX CONSIDERATIONS" HEREIN
AND IN THE ACCOMPANYING PROSPECTUS.)

[An election will be made to treat all or a portion of the assets of the
Trust Fund as a "real estate mortgage investment conduit" ("REMIC"). The
Offered Certificates other than the Class R Certificate will be designated as
"regular interests" and the Class R Certificate will be designated as the
sole class of "residual interests" in the REMIC. See "CERTAIN FEDERAL INCOME
TAX CONSIDERATIONS" herein and in the accompanying Prospectus.]

This Prospectus Supplement does not contain complete information about
the offering of the Offered Certificates. Additional information is contained
in the Prospectus and investors must read both the Prospectus and this
Prospectus Supplement to obtain material information about the offering of
the Offered Certificates. Sales of the Offered Certificates may not be
consummated unless the purchaser has received both the Prospectus and this
Prospectus Supplement.

Until ninety days after the date of this Prospectus Supplement, all
dealers effecting transactions in the Offered Certificates, whether or not
participating in this distribution, may be required to deliver a Prospectus
Supplement and the Prospectus. This is in addition to the obligation of
dealers acting as underwriters to deliver a Prospectus Supplement and the
Prospectus with respect to their unsold allotments or subscriptions.

The information set forth herein under "[The Servicer]" has been
provided by [The Servicer]. No representation is made by the Depositor, the
Underwriter or any of their respective affiliates as to the accuracy or
completeness of the information provided by [The Servicer].

_______________

No person is authorized in connection with this offering to give any
information or to make any representation about the Seller, the Depositor,
[The Servicer], the Offered Certificates or any other matter referred to
herein, other than those contained in this Prospectus Supplement or the
Prospectus. If any other information or representation is given or made, such
information or representation may not be relied upon as having been
authorized by the Depositor or the Underwriter. This Prospectus Supplement
and the Prospectus do not constitute an offer to sell or a solicitation of an
offer to buy securities other than the Offered Certificates, or an offer to
sell or a solicitation of an offer to buy securities in any jurisdiction or
to any person to whom it is unlawful to make such offer in such jurisdiction.
Neither the delivery of this Prospectus Supplement or the Prospectus nor any
sale hereunder or thereunder shall, under any circumstances, create any
implication that the information contained herein or therein is correct as of
any time subsequent to their respective dates.

**************************************************************************
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement
becomes effective. This prospectus shall not constitute an offer to sell or
the solicitation of an offer to buy nor shall these be any sale of these
securities in any state in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws of
any such state.
**************************************************************************

PROSPECTUS SUPPLEMENT
TABLE OF CONTENTS

SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
Geographical Concentration of the Mortgage Loans . . . . . . . . . . . S-
Status of the Mortgage Loans in the Event of Insolvency . . . . . . . . S-
Limited Liquidity . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
DESCRIPTION OF THE CERTIFICATES . . . . . . . . . . . . . . . . . . . . . S-
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
Book-Entry Registration of Class [___] Certificates . . . . . . . . . . S-
Priority of Distributions . . . . . . . . . . . . . . . . . . . . . . . S-
Distributions of Interest . . . . . . . . . . . . . . . . . . . . . . . S-
Distributions of Principal . . . . . . . . . . . . . . . . . . . . . . S-
Available Distribution Amount . . . . . . . . . . . . . . . . . . . . . S-
Example of Distributions . . . . . . . . . . . . . . . . . . . . . . . S-
The Residual Certificate . . . . . . . . . . . . . . . . . . . . . . . S-
Allocation of Realized Losses . . . . . . . . . . . . . . . . . . . . . S-
Final Scheduled Distribution Date . . . . . . . . . . . . . . . . . . . S-
Optional Termination of the Trust . . . . . . . . . . . . . . . . . . . S-
The Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
DESCRIPTION OF THE MORTGAGE POOL . . . . . . . . . . . . . . . . . . . . S-
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
[The Index [if applicable] . . . . . . . . . . . . . . . . . . . . . . . S-]
ADDITIONAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . S-
THE SERVICER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
Delinquency Experience . . . . . . . . . . . . . . . . . . . . . . . . S-
SERVICING OF THE MORTGAGE LOANS . . . . . . . . . . . . . . . . . . . . . S-
[The Subservicer . . . . . . . . . . . . . . . . . . . . . . . . . . . S-]
Insurance Coverage . . . . . . . . . . . . . . . . . . . . . . . . . . S-
Servicing Compensation and Payment of Expenses . . . . . . . . . . . . S-
Prepayment Interest Shortfalls . . . . . . . . . . . . . . . . . . . . S-
Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
Collection of Taxes, Assessments and Similar Items . . . . . . . . . . S-
Certain Rights Related to Foreclosure . . . . . . . . . . . . . . . . . S-
TRUST AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
Assignment of Mortgage Loans . . . . . . . . . . . . . . . . . . . . . S-
Voting Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
YIELD, PREPAYMENT AND WEIGHTED AVERAGE LIFE . . . . . . . . . . . . . . . S-
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
Subordination of the Class [ ] Certificates . . . . . . . S-
---------------
Weighted Average Life . . . . . . . . . . . . . . . . . . . . . . . . . S-
CERTAIN FEDERAL INCOME TAX CONSIDERATIONS . . . . . . . . . . . . . . . . S-
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
Residual Certificates . . . . . . . . . . . . . . . . . . . . . . . . . S-
LEGAL INVESTMENT CONSIDERATIONS . . . . . . . . . . . . . . . . . . . . . S-
USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
UNDERWRITING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
ERISA CONSIDERATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . S-
LEGAL MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
RATINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-
GLOSSARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-

SUMMARY

The following summary is qualified in its entirety by reference to the
detailed information appearing elsewhere in this Prospectus Supplement and
the accompanying Prospectus. Capitalized terms used and not otherwise defined
herein have the respective meanings assigned to them in the Prospectus.
Wherever reference is made herein to a percentage of some or all of the
Mortgage Loans, such percentage is determined (unless otherwise specified) on
the basis of the aggregate Scheduled Principal Balance of such Mortgage Loans
as of the Cut-off Date.

THE OFFERED
CERTIFICATES . . . . . . . . Mortgage Pass-Through Certificates, Series [
], in the Classes indicated on the cover
page hereof. The Offered Certificates will be
issued pursuant to a Trust Agreement, to be
dated as of [ ] 1, [ ], between the
Depositor and the Trustee (the "Trust
Agreement"). [The Senior Certificates and the
Subordinate Certificates will have initial
aggregate Certificate Principal Amounts equal
to approximately [ ]% and [ ]%,
respectively, of the aggregate outstanding
principal balance of the Mortgage Loans as of
the Cut-off Date.) See "DESCRIPTION OF THE
CERTIFICATES" herein.

DEPOSITOR . . . . . . . . . . Structured Asset Securities Corporation (the
"Depositor"). The Depositor's principal
offices are located at 200 Vesey Street, New
York, New York 10285, telephone (212) 526-
5594. See "The Issuer" in the Prospectus.

SELLER . . . . . . . . . . . Lehman Capital, A Division of Lehman Brothers
Holdings Inc. The Seller's principal offices
are located at 200 Vesey Street, New York,
New York 10285, telephone (212) 526-3305.

SERVICER . . . . . . . . . . [Servicer], a [ ] company ("[Servicer]"),
will service the Mortgage Loans pursuant to
an agreement (the "Sale and Servicing
Agreement") that will be assigned to the
Trustee. The Servicer will receive a monthly
fee (the "Servicing Fee") with respect to
each Mortgage Loan. See "[Servicer]" and
"SERVICING OF THE MORTGAGE LOANS" herein.

TRUSTEE . . . . . . . . . . [Trustee], a [ ]. See
"DESCRIPTION OF THE CERTIFICATES -- The
Trustee" herein.

CUT-OFF DATE . . . . . . . . [ ].

CLOSING DATE . . . . . . . . On or about [ ] (the "Closing
Date").

DISTRIBUTION
DATE . . . . . . . . . . . . The distribution date (the "Distribution
Date") will be the [ ] day of each month
or, if such [ ] day is not a Business Day,
then on the next succeeding Business Day,
commencing in [ ].

RECORD DATE . . . . . . . . . The record date (the "Record Date") for each
Distribution Date will be the close of
business on the last Business Day of the
month immediately preceding the month in
which such Distribution Date occurs.

DISTRIBUTIONS OF
INTEREST AND PRINCIPAL . . . Interest accrued during the calendar month
(each, an "Interest Accrual Period")
preceding each Distribution Date on each
Class of Offered Certificates at the per
annum rate described on the cover page hereof
will be distributable on each Distribution
Date. See "DESCRIPTION OF THE CERTIFICATES --
Distributions of Interest" herein.

The approximate initial Class Certificate
Principal Amount of each Class of Offered
Certificates is set forth on the cover page
hereof.

On each Distribution Date, an amount equal to
the Principal Distribution Amount (as defined
herein) for such Distribution Date will be
applied, as more fully described herein, to
make distributions of principal on the
Offered Certificates. See "DESCRIPTION OF THE
CERTIFICATES -- Distributions of Principal"
herein.

THE MORTGAGE POOL . . . . . . The Mortgage Pool will consist of
approximately [ ] conventional, monthly
payment mortgage loans (the "Mortgage Loans")
having an aggregate Scheduled Principal
Balance as of the Cut-off Date of
approximately $[ ]. The Mortgage
Loans are secured by first liens on one- to
four-family residential real properties or by
shares issued by cooperative housing
corporations and the related leasehold
interests (each, a "Mortgaged Property") and
have original terms to maturity from the
first due date of the scheduled monthly
payment of principal and/or interest (each
such payment, a "Scheduled Payment") of not
more than [30] years. Each Mortgage Loan
bears interest [at an adjustable/fixed] date
(each, a "Mortgage Rate"). [Certain of the
Mortgage Loans are secured by Additional
Collateral as described herein.]

[The Mortgage Rate on each Mortgage Loan will
be fixed for the first [ ] years after
origination (or, in some cases, modification)
of such loan and thereafter will be subject
to adjustment annually on the adjustment date
applicable thereto (each such date, a "Rate
Adjustment Date"), as further described
herein, to equal the sum, generally rounded
to the nearest [ ]%, of the Index (as
defined herein) and [ ]% (the "Gross
Margin"), subject to a periodic rate
adjustment cap of [ ]% (the "Periodic Cap")
and to maximum Mortgage Rates ("Maximum
Rates"), as described herein.]

[[ ] of the Mortgage Loans, representing
approximately [ ]% of the Mortgage Pool,
provide for monthly payments of interest at
the related Mortgage Rate but no payments of
principal for the first ten years after
origination of such Mortgage Loan. Following
such ten year period, the monthly payment on
each such Mortgage Loan will be increased to
an amount sufficient to fully amortize the
outstanding principal balance of such
Mortgage Loan over its remaining term and to
pay interest at the related Mortgage Rate.]

[[ ] Mortgage Loans, representing
approximately [ ]% of the Mortgage Pool,
provide that the borrower may, on certain
dates and subject to certain conditions, as
specified in the related Mortgage Note,
convert the adjustable Mortgage Rate of the
related Mortgage Loan to a fixed rate. The
Servicer is obligated to purchase any
Mortgage Loan as to which such option is
exercised for an amount equal to the unpaid
principal balance of such Mortgage Loan plus
accrued interest thereon at the applicable
Mortgage Rate in effect immediately prior to
such conversion (or, in certain
circumstances, substitute another mortgage
loan).]

[[ ] Mortgage Loans, representing
approximately [ ]% of the Mortgage Pool,
are Unrecognized Cooperative Loans (as
defined herein); the value of the related
collateral may prove to be substantially
less, in the event of foreclosure, than the
unpaid principal balance of the related
Mortgage Loan. See "RISK FACTORS --
Cooperative Loans; Unrecognized Security
Interests" herein.]

[[ ] Mortgage Loans, representing
approximately by, in addition to real estate
or shares of stock [ ]% of the Mortgage
Pool, are secured in part in a cooperative
housing corporation (and the related
leasehold interest), Additional Collateral
generally consisting of marketable
securities. See "DESCRIPTION OF THE MORTGAGE
POOL -- Additional Collateral" herein.]

See "DESCRIPTION OF THE MORTGAGE POOL"
herein.
[PRE-FUNDING ARRAGEMENT] . .
[To be provided if applicable].

[INDEX [IF APPLICABLE] . . . The Index used in the determination of the
Mortgage Rate for each Mortgage Loan will be
the weekly average yield on United States
Treasury Securities adjusted to a constant
maturity of one year, as published by the
Federal Reserve Board (the "Index") as most
recently available as of the date 45 days
prior to the related Rate Adjustment Date.
See "DESCRIPTION OF THE MORTGAGE POOL -- THE
INDEX" herein.]

[ADVANCES . . . . . . . . . . The Servicer is required to make advances
("Advances") in respect of Scheduled Payments
on the Mortgage Loans, net of the Servicing
Fee, subject to the limitations described
herein. The Trustee will be obligated to make
any such Advance if the Servicer fails in its
obligation to do so, to the extent provided
in the Trust Agreement. See "SERVICING OF THE
MORTGAGE LOANS -- Advances" herein.]

[ALLOCATION OF LOSSES; The Class [ ] Certificates
SUBORDINATION . . . . . . . . (collectively, the "Subordinate
Certificates") are subordinate to the Class [
] Certificates (collectively, the
"Senior Certificates"). Each Class of
Subordinate Certificates is subordinate to
the Class or Classes of Subordinate
Certificates having a higher priority (i.e.
the Class [ ] Certificates are
subordinate to the Class [ ] Certificates,
the Class [ ] Certificates are subordinate
to the Class [ ] Certificates, and so
forth) to the extent described herein.

The limited protection afforded to the
holders of the Senior Certificates by means
of the subordination feature described above
will be accomplished by (i) the preferential
right of such holders to receive, prior to
any distribution being made on a Distribution
Date in respect of the Subordinate
Certificates, the amount due them on each
Distribution Date from the Available
Distribution Amount and, if necessary, by the
right of such holders to receive future
distributions with respect to the Mortgage
Loans that would otherwise have been payable
to the Subordinate Certificates and (ii) the
allocation of Realized Losses on the Mortgage
Loans in the following manner. Subject to the
limitations described below, the principal
portion of Realized Losses (as defined
herein) on the Mortgage Loans will be
allocated first, to the Class [
] Certificates, in that order, until the
Class Certificate Principal Amounts thereof
have been reduced to zero, before being
allocated to the Senior Certificates, pro
rata in proportion to their respective
outstanding Class Certificate Principal
Amounts. The protection
provided to the Senior Certificates by the
subordination of the subordinate certificates
will be limited in the case of Special Hazard
Losses, Bankruptcy Losses and Fraud Losses,
as described herein. See "DESCRIPTION OF THE
CERTIFICATES -- Allocation of Realized
Losses" herein.]

Scheduled distributions on the Mortgage
FINAL SCHEDULED Loans, assuming no defaults or losses that
DISTRIBUTION DATE . . . . . . are not covered by the credit support
described elsewhere herein, will be
sufficient to make timely distributions of
interest and reduce the aggregate Certificate
Principal Amount of the Offered Certificates
to zero not later than [ ]. The
actual final Distribution Date for the
Offered Certificates may be earlier or later,
and could be substantially earlier, than the
Final Scheduled Distribution Date. See
"DESCRIPTION OF THE CERTIFICATES -- Final
Scheduled Distribution Date" and "YIELD,
PREPAYMENT AND WEIGHTED AVERAGE LIFE" herein.

OPTIONAL TERMINATION . . . . On any Distribution Date after the aggregate
Scheduled Principal Balance of the Mortgage
Loans is less than [ ]% of the aggregate
Scheduled Principal Balance of the Mortgage
Loans on the Cut-off Date, the Depositor
(subject to the terms of the Trust Agreement)
will have the option to cause the sale of the
assets of the Trust Fund, consisting of the
Mortgage Loans, any REO Property, and any
other property remaining in the Trust Fund,
and thereby effect the termination of the
Trust Fund. The proceeds of such a sale will
be treated as a prepayment of the Mortgage
Loans for purposes of distributions to
Certificateholders. See "DESCRIPTION OF THE
CERTIFICATES -- Optional Termination of the
Trust" herein.

DENOMINATIONS . . . . . . . . The Class [ ] Certificates will be
issued, maintained and transferred on the
book-entry records of The Depository Trust
Company ("DTC") and its Participants in
minimum denominations of $[100,000] and
integral multiples of $1 in excess thereof.
Each Class of Subordinate Certificates will
be issued in definitive, fully registered
form in minimum denominations of $[250,000]
and integral multiples of $1,000 in excess
thereof. The Class R Certificate will be
issued as a single Certificate and maintained
in definitive, fully registered form,
representing the entire Certificate Principal
Amount of such Class.

BOOK-ENTRY
CERTIFICATES . . . . . . . . The Class [ ] Certificates (the "Book-
Entry Certificates") will be represented by
one or more Certificates registered in the
name of Cede & Co., as nominee of DTC. No
person acquiring a beneficial interest in a
Book-Entry Certificate (each, a "Beneficial
Owner") will be entitled to receive a
Certificate of such Class in certificated
form, except under the limited circumstances
described herein. For each Book-Entry
Certificate, DTC will effect payments to and
transfers of the Book-Entry Certificates
among the respective Beneficial Owners by
means of its electronic recordkeeping
services, acting through organizations that
participate in DTC. This arrangement may
result in certain delays in receipt of
distributions by Beneficial Owners and may
restrict a Beneficial Owner's ability to
pledge the Book-Entry Certificates
beneficially owned by it. All references in
this Prospectus Supplement to the Book-Entry
Certificates reflect the rights of Beneficial
Owners only as such rights may be exercised
through DTC and its participating
organizations so long as such Certificates
are held by DTC. See "DESCRIPTION OF THE
CERTIFICATES -- Book-Entry Registration" in
the Prospectus.

USE OF PROCEEDS . . . . . . . The Depositor will apply the net proceeds
from the sale of the Offered Certificates
toward the purchase of the Mortgage Loans.
See "USE OF PROCEEDS" herein.

PREPAYMENT
CONSIDERATIONS . . . . . . . The rate of principal payments on the Offered
Certificates will depend on, among other
things, the rate and timing of principal
payments (including prepayments, repurchases,
defaults and liquidations) on the Mortgage
Loans. As is the case with mortgage-backed
securities generally, the Offered
Certificates are subject to substantial
inherent cash flow uncertainties because the
Mortgage Loans may be prepaid at any time.
Generally, when prevailing interest rates
increase, prepayment rates on mortgage loans
tend to decrease in subsequent periods,
resulting in a reduced rate of return of
principal to investors at a time when
reinvestment at such higher prevailing rates
would be desirable. Conversely, when
prevailing interest rates decline, prepayment
rates on mortgage loans tend to increase in
subsequent periods, resulting in an
accelerated rate of return of principal to
investors at a time when reinvestment at
comparable yields may not be possible.

See "DESCRIPTION OF THE MORTGAGE POOL" and
"YIELD, PREPAYMENT AND WEIGHTED AVERAGE LIFE"
herein.

YIELD CONSIDERATIONS . . . . The yields to maturity on the Offered
Certificates will depend on, among other
things, the rate and timing of principal
payments (including prepayments, repurchases,
defaults and liquidations) on the Mortgage
Loans and the allocation thereof to reduce
the Certificate Principal Amounts thereof.
The yields to maturity on the Offered
Certificates will also depend on other
factors, such as the Certificate Interest
Rate and the purchase price for such
Certificates. The yields on the Offered
Certificates will be adversely affected by
the allocation thereto of any Net Prepayment
Interest Shortfalls (as defined herein) on
the Mortgage Loans.

In general, in the case of any Offered
Certificates purchased at a premium, if
principal payments on the Mortgage Loans
occur at a rate faster than anticipated at
the time of purchase, the investor's actual
yield to maturity may be lower than that
originally anticipated. Conversely, in the
case of any Offered Certificates purchased at
a discount, if principal payments on the
Mortgage Loans occur at a rate slower than
that assumed at the time of purchase, an
investor's actual yield to maturity may be
lower than that originally anticipated.

See "YIELD, PREPAYMENT AND WEIGHTED AVERAGE
LIFE" herein.

FEDERAL INCOME TAX
CONSIDERATIONS . . . . . . . [An election will be made to treat all or a
portion of the Trust Fund as a real estate
mortgage investment conduit (the "REMIC").
Each Class of Offered Certificates other than
the Class R Certificate will be designated as
a Class of "regular interests" and the Class
R Certificate will be designated as the sole
class of "residual interest" in the REMIC.

The holders of the Offered Certificates
(other than the Class R Certificate) must
include interest income derived therefrom in
income as it accrues, regardless of the
holders' usual methods of accounting. The
Offered Certificates may be issued with
original issue discount for federal income
tax purposes. Original issue discount must be
included in income as it accrues on a
constant yield method, regardless or whether
a holder receives concurrently the cash
attributable to such original issue discount.

The Residual Certificateholder generally will
be required to report as federal taxable
income its pro rata share of the REMIC's net
income, without regard to the timing or
amount of cash distributions. The tax
liability may exceed the amount of cash
distributed to the Residual Certificateholder
in many or all taxable years. As the residual
interest in the REMIC, the Residual
Certificate will be taxable as described in
the Prospectus under "CERTAIN FEDERAL INCOME
TAX CONSIDERATIONS -- Taxation of Holders of
Residual Interest Certificates."]

For further information regarding the federal
income tax consequences of investing in the
Offered Certificates, see "CERTAIN FEDERAL
INCOME TAX CONSIDERATIONS" herein and in the
Prospectus.

[TRANSFER RESTRICTIONS ON
RESIDUAL CERTIFICATES . . . . A Residual Certificate may not be
transferred, sold, pledged or otherwise
assigned unless, prior to such transfer, the
proposed transferee delivers to the Trustee
an affidavit or, at the option of the
Trustee, an opinion to the effect that, among
other things, such transferee is not a
"disqualified organization," within the
meaning of the Code. If, notwithstanding such
restrictions, a Residual Certificate is
transferred to a "disqualified organization,"
a substantial tax may be imposed on the
transferor. In the case of a transfer to or
from a non-U.S. person, certain additional
conditions must be satisfied prior to
transfer of a Residual Certificate. In
addition to the foregoing, regulations permit
certain transfers of Residual Certificates to
be disregarded with the result that the
transferor will continue to be treated as the
owner of the Residual Certificate. See
"CERTAIN FEDERAL INCOME TAX CONSIDERATIONS"
herein and in the Prospectus.]

RATINGS . . . . . . . . . . . It is a condition to the issuance of the
Class [ ] Certificates that they be rated
"[ ]" by [ ],
a division of (the "Rating Agencies"). It is
a condition to the issuance of the Class [
] Certificates that they be rated
"[ ]," respectively, by [ ]. See
"RATINGS" herein.

ERISA CONSIDERATIONS . . . . A fiduciary of any employee benefit plan
subject to the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"),
or the Code, should carefully review with its
legal advisors whether the purchase or
holding of the Offered Certificates could
give rise to a transaction prohibited or not
otherwise permissible under ERISA or the
Code. The Class [ ] Certificates
may not be purchased by Plans (as defined
herein), except as described herein, and
transfer thereof will be restricted as
provided in the Trust Agreement. See "ERISA
CONSIDERATIONS" herein and in the Prospectus.

LEGAL INVESTMENT . . . . . . [The Senior Certificates and the Class [
] Certificates will constitute "mortgage
related securities" for purposes of the
Secondary Mortgage Market Enhancement Act of
1984 ("SMMEA") for so long as they are rated
as described herein and, as such, are legal
investments for certain entities to the
extent provided in SMMEA. SMMEA, however,
provides for state limitation on the
authority of such entities to invest in
"mortgage related securities" to the extent
described herein and in the Prospectus.]

The Depositor makes no representations as to
the proper characterization of the Offered
Certificates for legal investment or other
purposes, or as to the ability of particular
investors to purchase the Offered
Certificates under applicable legal
investment restrictions. These uncertainties
may adversely affect the liquidity of the
Offered Certificates. Accordingly, all
institutions whose investment activities are
subject to legal investment laws and
regulations, regulatory capital requirements
or review by regulatory authorities should
consult with their own legal advisors in
determining whether and to what extent the
Offered Certificates constitute a legal
investment or are subject to investment,
capital or other restrictions. Institutions
whose investment activities are subject to
review by federal or state regulatory
authorities should consult with their counsel
or the applicable authorities in order to
determine whether an investment in the
Offered Certificates complies with applicable
guidelines, policy statements or
restrictions. See "LEGAL INVESTMENT
CONSIDERATIONS" herein and "LEGAL INVESTMENT"
in the Prospectus.

RISK FACTORS

In addition to the matters described elsewhere in this Prospectus
Supplement and the accompanying Prospectus, prospective investors should
carefully consider the following factors before deciding to invest in the
Offered Certificates.

GEOGRAPHICAL CONCENTRATION OF THE MORTGAGE LOANS

Approximately [ ]% of the Mortgage Loans are secured by Mortgaged
Properties located in the state of [ ]. In addition, approximately [
]% and [ ]% of the Mortgage Loans are secured by Mortgaged Properties
located in the states of [ ] and [ ], respectively. The
economies of such states may be adversely affected to a greater degree than
the economies of other areas of the country by certain developments affecting
industries concentrated in such states. In recent periods, several regions of
the United States (including California and the northeast) have experienced
significant downturns in the market value of real estate. In addition,
Mortgaged Properties located in California may be more susceptible to certain
types of hazards, such as wildfires and mudslides, and certain types of
special hazards not covered by insurance (such as earthquakes) than
properties located in other parts of the country.

For additional information regarding the geographic distribution of the
Mortgage Loans, see "DESCRIPTION OF THE MORTGAGE POOL" herein.

STATUS OF THE MORTGAGE LOANS IN THE EVENT OF INSOLVENCY

Each transfer of a Mortgage Loan to the Seller, from the Seller to the
Depositor and from the Depositor to the Trust Fund is intended to be an
absolute and unconditional sale of such Mortgage Loan. However, in the event
of bankruptcy of a prior owner of a Mortgage Loan, a trustee in bankruptcy or
a creditor of the insolvent party could attempt to recharacterize the sale of
such Mortgage Loan by such insolvent party as a borrowing secured by a pledge
of such Mortgage Loan. Such an attempt, even if unsuccessful, could result in
delays in payments on the Offered Certificates. If such an attempt were
successful, holders of the Offered Certificates could suffer losses, and
could fail to fully recover their initial investments.

LIMITED LIQUIDITY

DESCRIPTION OF THE CERTIFICATES

GENERAL

[The Series [ ] Mortgage Pass-Through Certificates (the
"Certificates") will consist of the following Classes: (i) the Class [ ]
Certificates (the "Senior Certificates"), (ii) the Class [ ]
Certificates (the "Subordinate Certificates"), and (iii) the Class R
Certificate (the "Residual Certificate"). The Senior Certificates and the
Class [ ] Certificates are sometimes referred to herein as the
"Offered Certificates". Only the Offered Certificates are offered hereby.]

Each Class of Offered Certificates will have the respective approximate
initial aggregate Certificate Principal Amount (a "Class Certificate
Principal Amount") set forth or described on the cover page hereof.

The Certificates will evidence the entire beneficial ownership interest
in the Trust Fund. The Trust Fund will generally consist of (i) the Mortgage
Loans, (ii) such assets as from time to time are identified as deposited in
respect of the Mortgage Loans in the Certificate Account, (iii) property
acquired by foreclosure of such Mortgage Loans or deed in lieu of foreclosure
and (iv) any applicable insurance policies and all proceeds thereof.

Distributions on the Offered Certificates will be made on each
Distribution Date, commencing [ ], to Certificateholders of record on
the immediately preceding Record Date. The "Record Date" for each
Distribution Date will be the close of business on the last Business Day of
the month immediately preceding the month in which such Distribution Date
occurs. A "Business Day" is generally any day other than a Saturday or Sunday
or a day on which banks in [New York or [ ]] are closed.

Distributions on the Offered Certificates will be made to each
registered holder entitled thereto, either (i) by check mailed to the address
of such Certificateholder as it appears on the books of the Trustee, or (ii)
at the request, submitted to the Trustee in writing at least five business
days prior to the related Record Date, of any holder of an Offered
Certificate having an initial Certificate Principal Amount of not less than
$2,500,000, by wire transfer (at the expense of such holder) in immediately
available funds; provided, that the final distribution in respect of any
Offered Certificate will be made only upon presentation and surrender of such
Certificate at the Corporate Trust Office of the Trustee. See "-- The
Trustee" herein.

The Class [ ] Certificates (the "Book-Entry Certificates") will be
issued, maintained and transferred on the book-entry records of The
Depository Trust Company ("DTC") and its Participants. The Book-Entry
Certificates will be issued in minimum denominations of $[ ] and integral
multiples of $[ ] in excess thereof.

The Book-Entry Certificates will be represented by one or more
certificates registered in the name of the nominee of DTC. The Depositor has
been informed by DTC that DTC's nominee will be Cede & Co. ("Cede"). No
person acquiring an interest in a Book-Entry Certificate (each, a "Beneficial
Owner") will be entitled to receive a certificate representing such person's
interest (a "Definitive Certificate"), except as set forth below under "--
Book-Entry Registration of Class [ ] Certificates -- Definitive
Certificates." Unless and until Definitive Certificates are issued for the
Book-Entry Certificates under the limited circumstances described herein, all
references to actions by Certificateholders with respect to the Book-Entry
Certificates shall refer to actions taken by DTC upon instructions from its
Participants, and all references herein to distributions, notices, reports
and statements to Certificateholders with respect to the Book-Entry
Certificates shall refer to distributions, notices, reports and statements to
DTC or Cede, as the registered holder of the Book-Entry Certificates, for
distribution to Beneficial Owners by DTC in accordance with DTC procedures.

Each Class of Class [ ] Certificates will be issued in
fully registered, certificated form in minimum denominations of $[ ]
and integral multiplies of $[ ] in excess thereof (plus, in the case of
one Certificate of each such Class, any remaining amount). The Class R
Certificate will be issued as a single Certificate and maintained in fully
registered certificated form.

BOOK-ENTRY REGISTRATION OF CLASS [ ] Certificates

General. Beneficial Owners that are not brokerage firms, banks, thrift
institutions or other financial intermediaries (each, a "Financial
Intermediary") or participating firms that act as agent for a Financial
Intermediary (each, a "Participant") but desire to purchase, sell or
otherwise transfer ownership of, or other interests in, the related Book-
Entry Certificates may do so only through Participants and Financial
Intermediaries. In addition, Beneficial Owners will receive all distributions
of principal and interest on the related Book-Entry Certificates through DTC
and its Participants. Accordingly, Beneficial Owners may experience delays in
their receipt of payments. Unless and until Definitive Certificates are
issued for the related Book-Entry Certificates, it is anticipated that the
only registered Certificateholder of such Book-Entry Certificates will be
Cede, as nominee of DTC. Beneficial Owners will not be recognized by the
Depositor or the Trustee as Certificateholders, as such term is used in the
Trust Agreement, and Beneficial Owners will be permitted to receive
information furnished to Certificateholders and to exercise the rights of
Certificateholders only indirectly through DTC, its Participants and
Financial Intermediaries.

Under the rules, regulations and procedures creating and affecting DTC
and its operations (the "Rules"), DTC is required to make book-entry
transfers of Book-Entry Certificates among Participants and to receive and
transmit distributions of principal and interest on such Book-Entry
Certificates. Participants and Financial Intermediaries with which Beneficial
Owners have accounts with respect to such Book-Entry Certificates similarly
are required to make book-entry transfers and receive and transmit such
distributions on behalf of their respective Beneficial Owners. Accordingly,
although Beneficial Owners will not possess physical certificates evidencing
their interests in the Book-Entry Certificates, the Rules provide a mechanism
by which Beneficial Owners, through their Participants and Financial
Intermediaries, will receive distributions and will be able to transfer their
interests in the Book-Entry Certificates.

Neither the Depositor nor the Trustee or any of their respective
affiliates will have any liability for any actions taken by DTC or its
nominee including, without limitation, actions with respect to any aspect of
the records relating to or payments made on account of beneficial ownership
interests in the Book-Entry Certificates held by Cede, as nominee for DTC, or
with respect to maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.

Definitive Certificates. Definitive Certificates will be issued to
Beneficial Owners or their nominees, respectively, rather than to DTC or its
nominee, only under the limited conditions set forth in the Prospectus under
"DESCRIPTION OF THE CERTIFICATES -- Book-Entry Registration."

Upon the occurrence of an event described in the Prospectus under "--
Book-Entry Registration," the Trustee (through DTC) is required to notify
Participants who have ownership of Book-Entry Certificates as indicated on
the records of DTC of the availability of Definitive Certificates for their
Book-Entry Certificates. Upon surrender by DTC of the Definitive Certificates
representing the Book-Entry Certificates and upon receipt of instructions
from DTC for re-registration, the Trustee will re-issue the Book-Entry
Certificates as Definitive Certificates in the respective principal amounts
owned by individual Beneficial Owners, and thereafter the Trustee will
recognize the holders of such Definitive Certificates as Certificateholders
under the Trust Agreement.

For additional information regarding DTC and the Book-Entry
Certificates, see "DESCRIPTION OF THE CERTIFICATES -- Book-Entry
Registration" in the Prospectus.

PRIORITY OF DISTRIBUTIONS

Distributions will be made on each Distribution Date from the Available
Distribution Amount (as defined herein) in the following order of priority:

[To be provided as applicable]

DISTRIBUTIONS OF INTEREST

The amount of interest distributable on each Distribution Date in
respect of each Class of Certificates will equal [To be provided as
applicable] Interest will accrue on the Certificates on the basis of a 360-
day year consisting of twelve 30-day months. Such interest will be
distributed, except to the extent described below, from the Available
Distribution Amount on each Distribution Date. Accrued Certificate Interest
not distributed on the Distribution Date related to the Interest Accrual
Period in which it accrued, other than any Net Prepayment Interest
Shortfalls, will be an "Interest Shortfall." Interest will not accrue on
Interest Shortfalls.

The "Certificate Interest Rate" for each Class of Offered Certificates
will be the per annum rate described on the cover page hereof. The "Net
Mortgage Rate" for any Mortgage Loan at any time equals the Mortgage Rate
thereof minus the sum of the [Servicing Fee Rate and the Trustee Fee Rate]
(each as defined herein). The "Certificate Principal Amount" of any
Certificate as of any Distribution Date will equal such Certificate Principal
Amount as of the Closing Date as reduced by all amounts previously
distributed on such Certificate in respect of principal and the principal
portion of any Realized Losses previously allocated to such Certificate. The
"Interest Accrual Period" for each Class of Certificates will be the calendar
month immediately preceding the month of such Distribution Date.

Prepayment Interest Shortfalls. When a principal prepayment in full is
made on a Mortgage Loan, the mortgagor is charged interest only to the date
of such prepayment, instead of for a full month. Partial Principal
Prepayments are applied as of the first day of the month of receipt, with a
resulting reduction in interest payable for the month during which the
partial prepayment is made. Full or partial prepayments (or proceeds of other
liquidations) received during any Prepayment Period (as defined herein) will
be distributed to Certificateholders on the Distribution Date following such
Prepayment Period. To the extent that, as a result of a full or partial
prepayment, a mortgagor is not required to pay a full month's interest on the
amount prepaid, a shortfall in the amount available to make payment of
interest on the Certificates could result. The difference between one month's
interest at the Mortgage Rate (giving effect to any Relief Act Reduction), as
reduced by the Servicing Fee Rate, on a Mortgage Loan as to which a voluntary
prepayment has been made and the amount of interest actually received in
connection with such prepayment is a "Prepayment Interest Shortfall." With
respect to prepayments in full or in part, the Servicer is obligated to
reduce the aggregate of its Servicing Fees (as defined herein) for the
related Distribution Date to fund any Prepayment Interest Shortfalls. See
"SERVICING OF THE MORTGAGE LOANS -- Prepayment Interest Shortfalls." Any
Prepayment Interest Shortfalls not funded by the Servicer ("Net Prepayment
Interest Shortfalls") will be allocated among all Classes of Certificates,
pro rata in proportion to Accrued Certificate Interest thereon for the
related Distribution Date.

DISTRIBUTIONS OF PRINCIPAL

Distributions of principal on the Certificates will be made on each
Distribution Date as described herein in an aggregate amount equal to the
Principal Distribution Amount, to the extent of the Available Distribution
Amount available to make such payments in accordance with the priorities set
forth under "-- Priority of Distributions" above. The "Principal Distribution
Amount" for any Distribution Date will, equal [To be provided as applicable]
The "Scheduled Principal Balance" of any Mortgage Loan as of any date of
determination is generally equal to the principal balance thereof as of the
Cut-off Date, reduced by (i) the principal portion of all Scheduled Payments
due on or before such date of determination, whether or not received, and
(ii) all amounts allocable to unscheduled principal payments received on or
before the last day of the Prepayment Period preceding such date of
determination.

The "Class Percentage" for each Class of Certificates for each
Distribution Date will be equal to the percentage obtained by dividing the
Class Certificate Principal Amount of such Class immediately prior to such
Distribution Date by the aggregate Certificate Principal Amount of all
Certificates immediately prior to such date. The "Subordinate Class
Percentage" for each Class of Subordinated Certificates for each Distribution
Date will be equal to the percentage obtained by dividing the Class
Certificate Principal Amount of such Class immediately prior to such
Distribution Date by the aggregate Certificate Principal Amount of all
Subordinate Certificates immediately prior to such date.

The "Senior Percentage" for any Distribution Date is the percentage
equivalent of a fraction, the numerator of which is the aggregate Certificate
Principal Amount of the Senior Certificates immediately prior to such date
and the denominator of which is the aggregate Certificate Principal Amount of
all Classes of Certificates immediately prior to such date. The "Subordinate
Percentage" for any Distribution Date will be the difference between 100% and
the Senior Percentage for such date.

[The "Senior Prepayment Percentage" for any Distribution Date will be
[To be provided as applicable]]

[The Subordinate Prepayment Percentage for any Distribution Date will be
the difference between 100% and the Senior Prepayment Percentage for such
date.]

[The "Subordinate Principal Distribution Amount" for each Distribution
Date is equal to the sum of:

[To be provided as applicable]

AVAILABLE DISTRIBUTION AMOUNT

The "Due Period" related to each Distribution Date commences on the
second day of the month preceding the month in which such Distribution Date
occurs and ends on the first day of the month in which such Distribution Date
occurs. For each Distribution Date, the "Collection Period" ends on the
Business Day immediately preceding the related Remittance Date. The
"Prepayment Period" is the calendar month preceding the month in which the
related Distribution Date occurs. The "Remittance Date" is the [ ] day (or
if such [ ] day is not a Business Day, the next preceding Business Day) of
the month in which the related Distribution Date occurs.

The "Available Distribution Amount" on each Distribution Date, as more
fully described in the Trust Agreement, will generally equal the sum of the
following amounts:

(1) the total amount of all cash received by the Servicer with respect
to the related Collection Period (or the related Prepayment Period, in the
case of Principal Prepayments) and remitted to the Trustee on the related
Remittance Date, which includes (i) Scheduled Payments due on the Mortgage
Loans during the related Due Period and collected prior to the related
Remittance Date or advanced by the Servicer (or the Trustee), (ii) payments
allocable to principal on the Mortgage Loans (other than Liquidation Proceeds
and Insurance Proceeds) to the extent received in advance of their scheduled
due dates and applied to reduce the principal balance of the Mortgage Loans
("Principal Prepayments"), together with accrued interest thereon, if any,
identified as having been received on the Mortgage Loans during the
Prepayment Period, plus any amounts paid by the Servicer in respect of
Prepayment Interest Shortfalls, in each case for such Distribution Date,
(iii) the proceeds of any repurchase of a Mortgage Loan required to be
repurchased by the Servicer, the Seller or any other party as a result of a
breach of a representation or warranty, and (iv) Insurance Proceeds and
Liquidation Proceeds, minus:

(a) all Scheduled Payments of principal and interest collected but
due on a date subsequent to the related Due Period;

(b) all Principal Prepayments received or identified after the
related Prepayment Period (together with any interest payments, if any,
received with such prepayments to the extent that they represent (in
accordance with the Servicer's usual application of funds) the payment
of interest accrued on the related Mortgage Loans for the period
subsequent to the related Prepayment Period);

(c) Liquidation Proceeds and Insurance Proceeds received after the
related Prepayment Period with respect to the Mortgage Loans; and

(d) all amounts due or reimbursable to the Trustee pursuant to the
Trust Agreement and to the Servicer pursuant to the Sale and Servicing
Agreement; and

(2) any other payments made by the Servicer, the Seller or the Depositor
with respect to such Distribution Date.

"Insurance Proceeds" means all proceeds of applicable insurance
policies, to the extent such proceeds are not applied to the restoration of
the Mortgaged Property or released to the Mortgagor.

"Liquidation Proceeds" means all amounts net of unreimbursed expenses
incurred in connection with liquidation or foreclosure and unreimbursed
Advances, if any, received and retained in connection with the liquidation of
defaulted Mortgage Loans, by foreclosure or otherwise, together with any net
proceeds received on a monthly basis with respect to any properties acquired
on behalf of the Certificateholders by foreclosure or deed in lieu of
foreclosure.

[THE RESIDUAL CERTIFICATE

In addition to distributions of principal and interest, the holder of
the Residual Certificate will be entitled to receive, generally, (i) the
amount, if any, of any Available Distribution Amount remaining on any
Distribution Date after distributions of principal and interest are made on
the regular interests and on the Residual Certificate on such date and (ii)
the proceeds, if any, of the assets of the Trust Fund remaining after the
principal amounts of the regular interests and of the Residual Certificate
have been reduced to zero. It is generally not anticipated that any material
assets will be remaining for such distributions at any such time. See
"CERTAIN FEDERAL INCOME TAX CONSIDERATIONS" herein and in the accompanying
Prospectus.]

[ALLOCATION OF REALIZED LOSSES

On each Distribution Date, subject to the limitations set forth below
with respect to Special Hazard Losses, Fraud Losses and Bankruptcy Losses,
the principal portion of any Realized Losses on the Mortgage Loans will be
allocated to and reduce the Class Certificate Principal Amounts of, first,
the Class ( ) Certificates, in that order, until the Class
Certificate Principal Amount of each such Class of Certificates has been
reduced to zero, before being allocated to the Senior Certificates, pro rata
in proportion to, and in reduction of, their respective outstanding Class
Certificate Principal Amounts.

The Class Certificate Principal Amount of the lowest ranking Class of
Subordinate Certificates then outstanding will also be reduced by the amount,
if any, by which the aggregate Certificate Principal Amount of all the
Certificates on any Distribution Date (after giving effect to distributions
of principal and allocation of Realized Losses on such date) exceeds the
aggregate Scheduled Principal Balance of the Mortgage Loans for the related
Distribution Date.

In general, a "Realized Loss" means (i) with respect to a Liquidated
Mortgage Loan, the amount by which the remaining unpaid principal balance of
such Mortgage Loan plus all accrued and unpaid interest thereon and any
related expenses exceeds the amount of Liquidation Proceeds received in
respect of such Mortgage Loan (net of related expenses), or (ii) the amount
by which, in the event of bankruptcy of a borrower, a bankruptcy court
reduces the secured debt to the value of the related Mortgaged Property (a
"Deficient Valuation"). "Bankruptcy Losses" are losses that are incurred as a
result of Deficient Valuations and any reduction, in a bankruptcy proceeding,
of the amount of the Scheduled Payment on a Mortgage Loan other than as a
result of a Deficient Valuation (a "Debt Service Reduction"). The principal
portion of Debt Service Reductions will not be allocated in reduction of the
Class Certificate Principal Balances of any Classes of Certificates. "Special
Hazard Losses" are, in general terms, Realized Losses arising out of certain
direct physical loss or damage to Mortgaged Properties that are not covered
by a standard hazard insurance policy, but excluding, among other things,
faulty design or workmanship and normal wear and tear. "Fraud Losses" are
losses sustained on Liquidated Mortgage Loans by reason of a default arising
from fraud, dishonesty or misrepresentations. In determining whether a
Realized Loss is a loss of principal or of interest, Liquidation Proceeds and
other recoveries on a Mortgage Loan will be applied first to outstanding
expenses incurred with respect to such Mortgage Loan, then to accrued, unpaid
interest, and finally to principal.

A "Liquidated Mortgage Loan" generally is a defaulted Mortgage Loan as
to which such Mortgage Loan or related REO Property has been disposed of and
all amounts expected to be recovered in respect of such Mortgage Loan have
been received by the Servicer on behalf of the Trust.

[The principal portion of Special Hazard Losses, Bankruptcy Losses
(other than Debt Service Reductions), and Fraud Losses that exceed the
"Special Hazard Loss Limit," "Bankruptcy Loss Limit," and "Fraud Loss Limit,"
respectively ("Excess Losses"), will be allocated pro rata among all Classes
of Certificates in proportion to, and in reduction of, their respective
outstanding Class Certificate Principal Amounts. The "Special Hazard Loss
Limit" will initially be approximately $[ ], the "Bankruptcy Loss Limit"
will initially be approximately $[ ], and the "Fraud Loss Limit" will
initially be approximately $[ ].]

[The Special Hazard Loss Limit will be reduced, from time to time, to an
amount equal on any Distribution Date to the lesser of (a) the greatest of
(i) [ ]% of the aggregate of the Scheduled Principal Balances of the
Mortgage Loans, (ii) [ ] the Scheduled Principal Balance of the Mortgage
Loan having the highest Scheduled Principal Balance and (iii) the aggregate
Scheduled Principal Balance of the Mortgage Loans secured by Mortgaged
Properties located in the single California postal zip code area having the
highest aggregate Scheduled Principal Balance of any such zip code area and
(b) the Special Hazard Loss Limit as of the Closing Date less the amount, if
any, of Special Hazard Losses incurred since the Closing Date.]

[The Bankruptcy Loss Limit will be reduced, from time to time, by the
amount of Bankruptcy Losses allocated to the Certificates. The date on which
the Bankruptcy Loss Limit has been reduced to zero is the "Bankruptcy
Coverage Termination Date."]

[The Fraud Loss Limit will be reduced, from time to time, by the amount
of Fraud Losses allocated to the Certificates. In addition, on each
anniversary of the Cut-off Date, the Fraud Loss Limit will be reduced as
follows: (a) on the first and second anniversaries of the Cut-off Date, to an
amount equal to the excess of [ ]% of the aggregate Scheduled Principal
Balance of the Mortgage Loans as of the Cut-off Date (the "Cut-off Date
Balance") over the cumulative amount of Fraud Losses allocated to the
Certificates, (b) on the third and fourth anniversaries of the Cut-off Date,
to an amount equal to the excess of [ ]% of the Cut-off Date Balance over
the cumulative amount of Fraud Losses allocated to the Certificates and (c)
on the fifth anniversary of the Cut-off Date, to zero.]

In the event that any amount is recovered in respect of principal of a
Liquidated Mortgage Loan after any related Realized Loss has been allocated
as described herein, such amount will be distributed to the Certificates
still outstanding, pro rata on the basis of any Realized Losses previously
allocated thereto. It is generally not anticipated that any such amounts will
be recovered.]

FINAL SCHEDULED DISTRIBUTION DATE

Scheduled distributions on the Mortgage Loans included in the Trust
Fund, assuming no defaults or losses that are not covered by the credit
support described elsewhere herein, will be sufficient to make timely
distributions of interest on the Offered Certificates and to reduce the
aggregate Certificate Principal Amount of the Offered Certificates to zero
not later than [ ]. The actual final Distribution Date for the
Offered Certificates may be earlier or later, and could be substantially
earlier, than their Final Scheduled Distribution Date.

The Final Scheduled Distribution Date for the Offered Certificates has
been determined by adding one month to the month of scheduled maturity of the
latest maturing Mortgage Loan.

OPTIONAL TERMINATION OF THE TRUST

On any Distribution Date after the date on which the aggregate Scheduled
Principal Balance of the Mortgage Loans is less than [ ]% of the Cut-off Date
Balance, the [ ] (subject to the terms of the Trust Agreement)
will have the option to cause the sale of the Mortgage Loans, any REO
Property and any other property remaining in the Trust Fund and thereby
effect the termination of the Trust Fund and the retirement of the
Certificates. The purchase price of the Mortgage Loans must be equal to the
sum of (a) 100% of the aggregate outstanding principal balance of such
Mortgage Loans, plus accrued interest thereon at the applicable Mortgage Rate
and (b) the fair market value of all other property remaining in the Trust
Fund. Such liquidation will be treated as a prepayment in full of the
Mortgage Loans for purposes of distributions to Certificateholders. Upon such
payment in full to Certificateholders of such amounts, the Trust Fund will be
terminated.

THE TRUSTEE

[ ], will be the Trustee under the Trust Agreement. The
Trustee will be paid a monthly fee equal to [ ]% per annum (the "Trustee
Fee Rate") of the aggregate principal balance of the Mortgage Loans (the
"Trustee Fee"), and will also be entitled to retain, as additional
compensation, any interest or other income earned on funds deposited in the
Certificate Account pending distribution to Certificateholders. The Trustee's
"Corporate Trust Office" for purposes of the presentment and surrender of the
Offered Certificates for the final distribution thereon and for all other
purposes is located at [ ], [ ], Attention: [
]], or such address as the Trustee may designate from time to time by notice
to the Certificateholders, the Depositor and the Servicer.

DESCRIPTION OF THE MORTGAGE POOL

GENERAL

The Mortgage Pool will consist of approximately [ ] conventional,
adjustable rate, monthly payment Mortgage Loans with original terms to
maturity of not more than [ ] years. The Mortgage Loans had an aggregate
Scheduled Principal Balance as of the Cut-off Date of approximately $[ ].
The Mortgage Loans were originated or acquired by (Originator] generally in
accordance with the underwriting criteria then in effect as described herein.
Interest on the Mortgage Loans accrues on the basis of a 360-day year
consisting of twelve 30-day months. Wherever reference is made herein to a
percentage of some or all of the Mortgage Loans, such percentage is
determined (unless otherwise specified) on the basis of the aggregate
Scheduled Principal Balance of such Mortgage Loans as of the Cut-off Date.

Each Mortgage Loan bears interest at a Mortgage Rate that is [To be
provided as applicable]

The weighted average Loan-to-Value Ratio of the Mortgage Loans at
origination was approximately [ ]%, and no Mortgage Loan had a Loan-to-
Value Ratio at origination exceeding [ ]%. None of the Mortgaged Loans
are covered by primary mortgage insurance. The "Loan-to-Value Ratio" of a
Mortgage Loan at any time is the ratio of the principal balance of such
Mortgage Loan at the date of determination to (a) in the case of a purchase,
the lesser of the sale price of the Mortgaged Property and its appraised
value at the time of sale, or (b) in the case of a refinance or modification,
the appraised value of the Mortgaged Property at the time of such refinance
or modification.

The Mortgage Loans are expected to have the following approximate
aggregate characteristics as of the Cut-off Date. Prior to the issuance of
the Certificates, Mortgage Loans may be removed from the Trust Fund as a
result of incomplete documentation or otherwise, if the Depositor deems such
removal necessary or appropriate. In addition, a limited number of other
mortgage loans may be included in the Trust Fund prior to the issuance of the
Offered Certificates.

Number of Mortgage Loans [ ]
Aggregate Scheduled Principal
Balance $[ ]
Mortgage Rates:
Weighted Average [ ]%
Range [ ]% to [ ]%
Weighted Average Remaining Term to Maturity (in
months) [ ]

The Scheduled Principal Balances of the Mortgage Loans ranged from $[
] to $[ ]. The Mortgage Loans had an average Scheduled Principal
Balance of approximately $[ ].

No more than approximately [ ]% of the Mortgage Loans were secured
by Mortgaged Properties located in any one zip code area.

[None of the Mortgage Loans are subject to negative amortization.]

The following tables set forth, as of the Cut-off Date, the number,
aggregate Scheduled Principal Balance and percentage of the Mortgage Loans
having the stated characteristics shown in the tables in each range.
(The sum of the amounts of the aggregate Scheduled Principal Balances and the
percentages in the following tables may not equal the totals due to
rounding.)

ORIGINAL LOAN-TO-VALUE RATIOS

<TABLE>
<CAPTION>
PERCENTAGE
AGGREGATE OF
SCHEDULED MORTGAGE
RANGE OF ORIGINAL LOAN-TO- NUMBER OF PRINCIPAL LOANS
VALUE RATIOS* (%) MORTGAGE LOANS BALANCE BY AGGREGATE
SCHEDULED
PRINCIPAL
BALANCE
<S> <C> <C> <C>
$ %

Total $ 100.00%

</TABLE>

The weighted average original Loan-to-Value Ratio is approximately [ )%.

MORTGAGE RATES

<TABLE>
<CAPTION>
PERCENTAGE OF
AGGREGATE MORTGAGE LOANS
SCHEDULED BY AGGREGATE
RANGE OF NUMBER OF PRINCIPAL SCHEDULED
MORTGAGE RATES (%) MORTGAGE LOANS BALANCE PRINCIPAL BALANCE

<S> <C> <C> <C>
$ %

Total $ 100.00%

</TABLE>

The weighted average Mortgage Rate is approximately [ ]%.

ORIGINAL TERMS TO MATURITY

<TABLE>
<CAPTION>
PERCENTAGE OF
AGGREGATE MORTGAGE LOANS
SCHEDULED BY AGGREGATE
NUMBER OF PRINCIPAL SCHEDULED
RANGE OF MATURITIES (MONTHS) MORTGAGE LOANS BALANCE PRINCIPAL BALANCE
<S> <C> <C> <C>
$

Total $ 100.00%

</TABLE>

The weighted average original term to maturity is approximately [ ]
months.

REMAINING TERMS TO MATURITY

<TABLE>
<CAPTION>
PERCENTAGE OF
AGGREGATE MORTGAGE LOANS
SCHEDULED BY AGGREGATE
NUMBER OF PRINCIPAL SCHEDULED
RANGE OF MATURITIES (MONTHS) MORTGAGE LOANS BALANCE PRINCIPAL BALANCE
<S> <C> <C> <C>
$ %

Total $ 100.00%

</TABLE>

The weighted average remaining term to maturity is approximately [ ]
months.

GEOGRAPHIC DISTRIBUTION

<TABLE>
<CAPTION>
PERCENTAGE OF
AGGREGATE MORTGAGE LOANS
SCHEDULED BY AGGREGATE
NUMBER OF PRINCIPAL SCHEDULED
STATE MORTGAGE LOANS BALANCE PRINCIPAL BALANCE
<S> <C> <C> <C>
$ %

Total $ 100.00%
__________

</TABLE>

SCHEDULED PRINCIPAL BALANCES

<TABLE>
<CAPTION>
PERCENTAGE OF
AGGREGATE MORTGAGE LOANS
SCHEDULED BY AGGREGATE
RANGE OF NUMBER OF PRINCIPAL SCHEDULED
SCHEDULED PRINCIPAL BALANCES ($) MORTGAGE LOANS BALANCE PRINCIPAL BALANCE
<S> <C> <C> <C>
$ %

Total $ 100.00%

</TABLE>

The average Scheduled Principal Balance is approximately $[ ].

PROPERTY TYPES

<TABLE>
<CAPTION>
PERCENTAGE OF
AGGREGATE MORTGAGE LOANS
SCHEDULED BY AGGREGATE
NUMBER OF PRINCIPAL SCHEDULED
PROPERTY TYPE MORTGAGE LOANS BALANCE PRINCIPAL BALANCE
<S> <C> <C> <C>
$ %

Total $ 100.00%

</TABLE>

LOAN PURPOSES

<TABLE>
<CAPTION>
PERCENTAGE OF
AGGREGATE MORTGAGE LOANS
SCHEDULED BY AGGREGATE
NUMBER OF PRINCIPAL SCHEDULED
LOAN PURPOSES MORTGAGE LOANS BALANCE PRINCIPAL BALANCE
<S> <C> <C> <C>
$ %

Total $ 100.00%

</TABLE>

OCCUPANCY STATUS

<TABLE>
<CAPTION>
PERCENTAGE OF
AGGREGATE MORTGAGE LOANS
SCHEDULED BY AGGREGATE
NUMBER OF PRINCIPAL SCHEDULED
OCCUPANCY STATUS MORTGAGE LOANS BALANCE PRINCIPAL BALANCE
<S> <C> <C> <C>
$ %

Total $ 100.00%

</TABLE>

[THE INDEX [IF APPLICABLE]

The Index used in the determination of the Mortgage Rates of the Mortgage
Loans will be [ ], as published by [ ](the
"Index").

ADDITIONAL INFORMATION

The description in this Prospectus Supplement of the Trust Fund and the
Mortgaged Properties is based upon the Trust Fund as constituted at the close
of business on the Cut-off Date, as adjusted for Scheduled Payments due on or
before such date. A Current Report on Form 8-K will be available to
purchasers of the Offered Certificates and will be filed, together with the
Trust Agreement and the Sale and Servicing Agreement, with the Securities and
Exchange Commission within fifteen days after the initial issuance of the
Offered Certificates. In the event Mortgage Loans are removed from or added
to the Trust Fund as set forth under "DESCRIPTION OF THE MORTGAGE POOL," such
removal or addition will be noted in the Current Report on Form 8-K.

[THE SERVICER]

GENERAL

The information set forth in this section has been provided by [Servicer],
and neither the Depositor nor the Underwriter makes any representations or
warranties as to the accuracy or completeness of such information.

DELINQUENCY EXPERIENCE

Generally, when a mortgagor fails to make a required payment on a
mortgage loan and does not cure the deficiency promptly, the loan is
classified as delinquent. In many cases, delinquencies are cured promptly,
but if not, foreclosure proceedings are generally commenced. The procedural
steps necessary for foreclosure vary from state to state, but generally, if
the loan is not reinstated within certain periods specified by the relevant
mortgage loan documents, the property securing the loan can be acquired by
the lender. If a mortgagee takes title to the mortgaged property through
foreclosure but the mortgaged property had a value lower than the outstanding
amount of the debt, the law in certain states permits such mortgagee to
obtain a deficiency judgment in the amount of the difference. The laws of
certain other states restrict or prohibit such deficiency judgments. It is
anticipated that, in those states where deficiency judgments are permitted,
the Servicer will determine on a case-by-case basis whether to seek such a
judgment.

Loan Servicing Activities. As of [ ], [Servicer]'s total loan
portfolio contained loans with an aggregate outstanding principal balance of
approximately $[ ] billion. The loans contained in [the Servicer]'s
servicing portfolio include fixed and adjustable rate loans, first and second
lien loans and one- to four family loans, and therefore may differ
significantly from the Mortgage Loans. There can be no assurance, and no
representation is made, that the delinquency experience with respect to the
Mortgage Loans will be similar to that reflected in the table below, nor is
any representation made as to the rate at which losses may be experienced on
liquidation of defaulted Mortgage Loans.

The following table sets forth certain information regarding the
delinquency experience of [Originator] with respect to all mortgage loans
serviced by it. The indicated periods of delinquency are based on the number
of days past due on a contractual basis.

MORTGAGE LOAN PORTFOLIO(1)
(DOLLAR AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
[Date] [Date]
NUMBER DOLLAR NUMBER DOLLAR
OF LOANS AMOUNT PERCENT OF LOANS AMOUNT PERCENT
<S> <C> <C> <C> <C> <C> <C>
Portfolio Principal
Balance $ 100.00% $ 100.00%
Delinquent Loans
30-59 days delinquent
60-89 days delinquent
90+ days delinquent
Non-accrual Loans(2)
Total
Net Charge-offs
REO

</TABLE>

__________

(1) Percentages in the table are rounded to the nearest 0.01%; dollar
amounts are rounded to the nearest dollar.

(2) In general, a "Non-accrual Loan" is a Mortgage Loan as to which (i)
payments are delinquent for a specified period (based on the principal
balance of such loan) or (ii) [the Servicer] determines that collection is in
doubt.

The above delinquency statistics represent the recent experience of [the
Servicer]. There can be no assurance, however, that the delinquency
experience on the Mortgage Loans will be comparable. In addition, the
foregoing statistics include mortgage loans with a variety of payment and
other characteristics that may not correspond to those of the Mortgage Loans.
The actual loss and delinquency experience on the Mortgage Loans will depend
on, among other things, the value of the real estate and cooperative shares
securing such Mortgage Loans and the ability of the mortgagors to make
required payments. If [the Servicer] undertakes litigation or retains outside
attorneys or investigators the cost thereof will be borne by the Trust Fund
or the Certificateholders. [the Servicer] will not be required to advance
funds for the conduct of such litigation or the hiring of such outside
attorneys or investigators, if it reasonably believes that such advances will
not be promptly reimbursed.

The likelihood that mortgagors will become delinquent in the payment of
their mortgage loans and the rate of any subsequent foreclosures may be
affected by a number of factors related to borrowers' personal circumstances,
including, for example, unemployment or change in employment (or in the case
of self- employed mortgagors or mortgagors relying on commission income,
fluctuations in income), marital separation and a mortgagor's equity in the
related mortgaged property. In addition, delinquency and foreclosure
experience may be sensitive to adverse economic conditions, either nationally
or regionally, may exhibit seasonal variations and may be influenced by the
level of interest rates and servicing decisions on the applicable mortgage
loans. Regional economic conditions (including declining real estate values)
may particularly affect delinquency and foreclosure experience on mortgage
loans to the extent that mortgaged properties are concentrated in certain
geographic areas.

SERVICING OF THE MORTGAGE LOANS

The Mortgage Loans will be serviced by [Servicer], as Servicer (the
"Servicer"), generally in accordance with the procedures as described in the
Prospectus under the heading "SERVICING OF LOANS," pursuant to an agreement
(the "Sale and Servicing Agreement") between the Seller and [Servicer]. The
Seller's rights under the Sale and Servicing Agreement will be assigned to
the Trustee. References in the Prospectus to the "Master Servicer" generally
include the Servicer, and references in the Prospectus to the "Servicer"
generally include the Subservicer. Although the Servicer will employ the
Subservicer to directly service the Mortgage Loans, the Servicer will remain
liable for its servicing obligations under the Sale and Servicing Agreement
as if the Servicer were directly servicing the Mortgage Loan.

[THE SUBSERVICER [IF APPLICABLE]

The Mortgage Loans will be subserviced by a designated servicing staff
of the [ ] . The Subservicer is [ ]. The Subservicer originates,
purchases and services residential and commercial mortgage loans through
approximately [ ] offices throughout the United States.]

[INSURANCE COVERAGE

The Servicer is required to obtain and thereafter maintain in effect a
bond, corporate guaranty or similar form of insurance coverage (which may
provide blanket coverage), or any combination thereof, insuring against loss
occasioned by the errors and omissions of the Servicer's officers and
employees.)

SERVICING COMPENSATION AND PAYMENT OF EXPENSES

The Servicer will be paid a monthly fee with respect to each Mortgage
Loan equal to [ ]% per annum (the "Servicing Fee Rate") of the principal
balance of such Mortgage Loan (the "Servicing Fee"). The Servicing Fee is
subject to reduction with respect to any Distribution Date as described below
under "--Prepayment Interest Shortfalls."

The Servicer will be entitled to receive, as additional compensation,
any interest or other income earned on funds it has deposited in a custodial
account pending remittance to the Trustee, as well as certain customary fees
and charges paid by borrowers. The Servicer will also be entitled to
reimbursement for certain expenses prior to distribution of any amounts to
Certificateholders. See "SERVICING OF LOANS -- Servicing Compensation and
Payment of Expenses" in the Prospectus.

PREPAYMENT INTEREST SHORTFALLS

When a borrower prepays a Mortgage Loan in full between Due Dates, the
mortgagor pays interest on the amount prepaid only from the last scheduled
Due Date to the date of prepayment. Partial principal prepayments are applied
as of the first day of the month of receipt, with a resulting reduction in
interest payable for the month during which the partial prepayment is made.
Any Prepayment Interest Shortfall is required to be paid by the Servicer, to
the extent that such amount does not exceed the aggregate of the Servicing
Fees on the Mortgage Loans serviced by it for the applicable Distribution
Date, through a reduction in the amount of such Servicing Fees. See
"DESCRIPTION OF THE CERTIFICATES -- Distribution of Interest" herein.

ADVANCES

The Servicer will be obligated to make Advances with respect to
delinquent payments of principal of and interest on the Mortgage Loans,
adjusted to the related Net Mortgage Rate, to the extent that such Advances,
in its judgment, are recoverable from future payments and collections,
insurance payments or proceeds of liquidation of a Mortgage Loan. The Trustee
will be obligated to make any such Advances if the Servicer fails to do so,
to the extent provided in the Trust Agreement. The Servicer or the Trustee,
as applicable, will be entitled to recover any Advances made by it with
respect to a Mortgage Loan out of late payments thereon or out of related
Liquidation Proceeds and Insurance Proceeds or, if such amounts are
insufficient, from collections on other Mortgage Loans. Such reimbursements
may result in Realized Losses.

The purpose of making such Advances is to maintain a regular cash flow
to the Certificateholders, rather than to guarantee or insure against losses.
No party will be required to make any Advance with respect to a reduction in
the amount of the monthly payment on a Mortgage Loan due to a reduction made
by a bankruptcy court in the amount of a Scheduled Payment owed by a
mortgagor or a Relief Act Reduction.

COLLECTION OF TAXES, ASSESSMENTS AND SIMILAR ITEMS

The Servicer generally does not require that escrow accounts be
maintained for the collection of hazard insurance premiums and real estate
taxes with respect to the Mortgage Loans. The Servicer will make advances
with respect to delinquencies in required escrow payments by the related
mortgagors.

CERTAIN RIGHTS RELATED TO FORECLOSURE

[Certain rights in connection with foreclosure of defaulted Mortgage
Loans may be granted to the holders of the Class [ ] Certificates and, when
such Certificates are no longer outstanding, to the holders of the Class [
] Certificates. Such rights would include the right to delay foreclosure
until a Mortgage Loan has been delinquent for six months, provided that upon
election to delay foreclosure such holder establishes a reserve fund for the
benefit of the Trust Fund in an amount equal to 125% of the greater of the
Scheduled Principal Balance of such Mortgage Loan and the appraised value of
the related Mortgaged Property, plus three months' accrued interest on such
Mortgage Loan. Any exercise of such right to delay foreclosure could affect
the amount recovered upon liquidation of the related Mortgaged Property.]

TRUST AGREEMENT

GENERAL

The Certificates will be issued pursuant to a Trust Agreement (the
"Trust Agreement") dated as of [ ] 1, [ ] between the Depositor
and the Trustee. Reference is made to the Prospectus for important
information in addition to that set forth herein regarding the terms and
conditions of the Trust Agreement and the Offered Certificates. Offered
Certificates in certificated form will be transferable and exchangeable at
the corporate trust office of the Trustee, which will serve as Certificate
Registrar and Paying Agent. The Depositor will provide to a prospective or
actual Certificateholder, without charge, on written request, a copy (without
exhibits) of the Trust Agreement. Requests should be addressed to Contract
Finance, Lehman Brothers, 3 World Financial Center, New York, New York 10285.

ASSIGNMENT OF MORTGAGE LOANS

The Mortgage Loans will be assigned to the Trustee, together with all
principal and interest due on the Mortgage Loans after the Cut-off Date. The
Trustee will, concurrently with such assignment, authenticate and deliver the
Certificates. Each Mortgage Loan will be identified in a schedule appearing
as an exhibit to the Trust Agreement which will specify with respect to each
Mortgage Loan, among other things, the original principal amount and the
outstanding principal amount as of the close of business on the Cut-off Date,
the Mortgage Rate, the Scheduled Payment, and the maturity date.

As to each Mortgage Loan, the following documents are generally required
to be delivered to the Trustee (or its custodian) in accordance with the
Trust Agreement: (i) the related original Mortgage Note endorsed without
recourse to the Trustee or in blank, (ii) the original Mortgage with evidence
of recording indicated thereon, (or, if such original recorded Mortgage has
not yet been returned by the recording office, a copy thereof certified to be
a true and complete copy of such Mortgage sent for recording) or, in the case
of a Cooperative Loan, the original security agreement and related documents,
(iii) an original assignment of the Mortgage to the Trustee or in blank in
recordable form or, in the case of a Cooperative Loan, an original assignment
of security agreement and related documents, (iv) the policies of title
insurance issued with respect to each Mortgage Loan (other than a Cooperative
Loan), and (v) the originals of any assumption, modification, extension or
guaranty agreements. Where necessary to protect the interest of the Trustee
in the Mortgage Loans, the assignments to the Trustee in connection with the
Mortgage Loans are required to be submitted for recording promptly after the
Closing Date. A custodian acting on behalf of the Seller will have reviewed
each mortgage file prior to the Closing Date and, if any such document is
found to be defective in any material respect and [Originator] does not cure
such defect within 90 days of notice thereof, [Originator] will obligated to
purchase the related Mortgage Loan from the Trust Fund (or, in certain
circumstances, substitute another mortgage loan).

Pursuant to the terms of the Sale and Servicing Agreement, [Originator]
has made, as of the date of such agreement (the "Sale Date"), to the Seller
certain representations and warranties concerning the Mortgage Loans that
include representations and warranties similar to those summarized in the
Prospectus under the heading "LOAN UNDERWRITING PROCEDURES AND STANDARDS --
Representations and Warranties." The Seller's rights under the Sale and
Servicing Agreement will be assigned to the Trustee for the benefit of
Certificateholders. Within 90 days following its discovery of a breach of any
representation or warranty that materially or adversely affects the interests
of Certificateholders in a Mortgage Loan, or receipt of notice of such
breach, [Originator] will be obligated to purchase the affected Mortgage Loan
from the Trust Fund for a price equal to the unpaid principal balance thereof
plus accrued interest thereon (or, in certain circumstances, substitute
another mortgage loan).

The Seller will make to the Depositor (and the Depositor will assign its
rights thereunder to the Trustee for the benefit of Certificateholders) only
certain limited representations and warranties intended to address certain
material conditions that may arise with respect to the Mortgage Loans between
the Sale Date and the Closing Date. In the event of a breach of any such
representation or warranty that does not constitute a breach of any
representation or warranty made by [Originator] as described above, the
Seller will be obligated in the same manner as [Originator], as described
above.

To the extent that any such Mortgage Loan is not repurchased by
[Originator] or the Seller and a Realized Loss occurs on such Mortgage Loan,
holders of Offered Certificates, in particular the Subordinate Certificates,
may incur a loss.

VOTING RIGHTS

Voting rights under the Trust Agreement will be allocated among the
Certificates in proportion to their respective Certificate Principal Amounts.

YIELD, PREPAYMENT AND WEIGHTED AVERAGE LIFE

GENERAL

The yields to maturity on the Offered Certificates will be affected by
the rate of principal payments on the Mortgage Loans (including prepayments,
which may include amounts received by virtue of repurchase, condemnation,
insurance or foreclosure), the extent to which Mortgage Loans bearing higher
Mortgage Rates prepay at a more rapid rate than Mortgage Loans with lower
rates, the amount and timing of mortgagor delinquencies and defaults
resulting in Realized Losses, the purchase price for the Certificates and
other factors.

Principal prepayments may be influenced by a variety of economic,
geographic, demographic, social, tax, legal and other factors. In general, if
prevailing interest rates fall below the interest rates on the Mortgage
Loans, the Mortgage Loans are likely to be subject to a higher rate of
prepayment than if prevailing rates remain at or above the interest rates on
such Mortgage Loans. Conversely, if prevailing interest rates rise above the
interest rates on such Mortgage Loans, the rate of prepayment would be
expected to decrease. Other factors affecting prepayment of the Mortgage
Loans include changes in borrowers' housing needs, job transfers,
unemployment, mortgagors' net equity in the mortgaged properties, changes in
the value of the mortgaged properties, mortgage market interest rates and
servicing decisions. The Mortgage Loans may generally be prepaid at any time
without penalty and generally have due-on-sale clauses.

The rate of principal payments on the Mortgage Loans will be affected by
the amortization schedules of the Mortgage Loans, the rate and timing of
prepayments thereon by the mortgagors, liquidations of defaulted Mortgage
Loans and repurchases of Mortgage Loans due to certain breaches of
representations and warranties or defective documentation. The weighted
average remaining term to maturity of the Mortgage Loans is approximately [
] months; such seasoning may influence the performance of the Mortgage
Loans. The timing of changes in the rate of prepayments, liquidations and
repurchases of the Mortgage Loans may, and the timing of Realized Losses
will, significantly affect the yield to an investor, even if the average rate
of principal payments experienced over time is consistent with an investor's
expectation. Since the rate and timing of principal payments on the Mortgage
Loans will depend on future events and on a variety of factors (as described
more fully herein and in the Prospectus under "YIELD, PREPAYMENT AND MATURITY
CONSIDERATIONS"), no assurance can be given as to such rate or the timing of
principal payments on the Offered Certificates. In general, the earlier a
prepayment of principal of the related Mortgage Loans, the greater the effect
on an investor's yield to maturity. The effect on an investor's yield of
principal payments occurring at a rate higher (or lower) than the rate
anticipated by the investor during the period immediately following the
issuance of the Certificates may not be offset by a subsequent like decrease
(or increase) in the rate of principal payments.

Prepayments, liquidations and repurchases of the Mortgage Loans will
result in distributions to holders of the Offered Certificates of principal
amounts that would otherwise be distributed over the remaining terms of the
Mortgage Loans. The rate of defaults on the Mortgage Loans will also affect
the rate and timing of principal payments on the Mortgage Loans. In general,
defaults on mortgage loans are expected to occur with greater frequency in
their early years.

As described herein, approximately [ ]% of the Mortgage Loans do not
provide for monthly payments of principal for the first ten years following
origination. Instead, only monthly payments of interest are due during such
period. Other considerations aside, due to such characteristics, borrowers
may be disinclined to prepay such loans during such ten year period. In
addition, because no principal is due on such loans for their initial ten
year period, the Certificates will amortize at a slower rate during such
period than would otherwise be the case. Thereafter, when the monthly
payments on such loans are recalculated on the basis of a twenty year, level
payment amortization schedule as described herein, principal payments on the
Certificates are expected to increase correspondingly, and, in any case, at a
faster rate than if payments on the underlying loans were calculated on the
basis of a thirty year amortization schedule. The Mortgage Loans were
generally originated (or modified) with Mortgage Rates for their first three
years below the rate that would have resulted if based on the Index and
related Gross Margin. The Mortgage Loans may experience lower rates of
prepayment during the period that the loans bear interest at such lower
Mortgage Rates. Notwithstanding the foregoing, no assurance can be given as
to any prepayment rate on the Mortgage Loans.

The Certificate Interest Rate for the Offered Certificates at any time
will be equal to the weighted average of the Net Mortgage Rates of the
Mortgage Loans. To the extent that Mortgage Loans bearing relatively high
Mortgage Rates experience a more rapid rate of prepayment than Mortgage Loans
with relatively low rates, the Certificate Interest Rate for the Offered
Certificates will be reduced; such reduction could be substantial.

If the purchaser of a Certificate offered at a discount from its initial
principal amount calculates its anticipated yield to maturity based on an
assumed rate of payment of principal that is faster than that actually
experienced on the related Mortgage Loans, the actual yield to maturity may
be lower than that so calculated. Conversely, if the purchaser of a
Certificate offered at a premium calculates its anticipated yield to maturity
based on an assumed rate of payment of principal that is slower than that
actually experienced on the related Mortgage Loans, the actual yield to
maturity may be lower than that so calculated.

The yields on the Offered Certificates will be reduced to the extent
that Net Prepayment Interest Shortfalls are experienced on the Mortgage
Loans.

The effective yields to holders of the Offered Certificates will be
lower than the yields otherwise produced by the Certificate Interest Rate and
the related purchase price because monthly distributions will not be made to
such holders until the [ ] day (or the immediately following Business Day
if such [ ] day is not a Business Day) of the month following the month
----
in which interest accrues on such Certificate (without any additional
distribution of interest or earnings thereon in respect of such delay.

[SUBORDINATION OF THE CLASS [ ]CERTIFICATES

On each Distribution Date, the holders of any higher ranking Class of
Certificates will have a preferential right to receive amounts of interest
and principal due to them on such Distribution Date before any distributions
are made on any Class of Certificates subordinate to such Class. As a result,
the yields to maturity and the aggregate amount of distributions on the Class
[ ] Certificates will be more sensitive than the yields of higher ranking
Certificates to the rate of delinquencies and defaults on the Mortgage Loans.

As more fully described herein, the principal portion of Realized Losses
(other than Excess Losses) on the Mortgage Loans will be allocated first to
the lower ranking Classes of Subordinate Certificates, then to the Class [
] Certificates, then to the Class [ ] Certificates, and then to the Class
[ ] Certificates, in that order, until the Class Certificate Principal
Amount of each such Class has been reduced to zero, before any such Realized
Losses will be allocated to the Senior Certificates. The interest portion of
Realized Losses (other than Excess Losses) will reduce the amount available
for distribution on the related Distribution Date to the lowest ranking Class
or Classes of Certificates outstanding on such date.]

WEIGHTED AVERAGE LIFE

Weighted average life refers to the average amount of time that will
elapse from the date of issuance of a security to the date of distribution to
the investor of each dollar distributed in net reduction of principal of such
security (assuming no losses). The weighted average lives of the Offered
Certificates will be influenced by, among other things, the rate at which
principal of the Mortgage Loans is paid, which may be in the form of
scheduled amortization, prepayments or liquidations.

Prepayments on mortgage loans are commonly measured relative to a [
] prepayment standard or model. The model used in this Prospectus
Supplement for the Mortgage Loans ("[ ]") represents [ ]. [
] does not purport to be either a historical description of the prepayment
experience of any pool of mortgage loans or a prediction of the anticipated
rate of prepayment of any mortgage loans, including the Mortgage Loans to be
included in the Trust Fund.

The following tables were prepared based on the actual characteristics
of the Mortgage Loans expected to be included in the Mortgage Pool and the
following additional assumptions (the "Modeling Assumptions"): (i) the
initial Class Certificate Principal Amounts and the Certificate Interest Rate
are as indicated on the cover of this Prospectus Supplement; (ii) each
Scheduled Payment of principal and/or interest is timely received every month
on the first day of each month commencing in [ ]; (iii) principal
prepayments are received in full on the last day of each month commencing in
[ ] and there are no Net Prepayment Interest Shortfalls; (iv) there are
no defaults or delinquencies on the Mortgage Loans; (v) there are no
repurchases or substitutions of the Mortgage Loans; (vi) there is no optional
termination of the Trust Fund and (vii) the Certificates are issued on [
].

The actual characteristics of the Mortgage Loans may, and the
performance of the Mortgage Loans will, differ from the assumptions used in
constructing the tables set forth below, which are hypothetical in nature and
are provided only to give a general sense of how the principal cash flows
might behave under varying prepayment scenarios. For example, it is not
expected that the Mortgage Loans will prepay at a constant rate until
maturity, that all of the Mortgage Loans will prepay at the same rate or that
there will be no defaults or delinquencies on the Mortgage Loans. Moreover,
the diverse remaining terms to maturity of the Mortgage Loans could produce
slower or faster principal distributions than indicated in the tables at the
various percentages of [ ] specified, even if the weighted average
remaining term to maturity of the Mortgage Loans is as assumed. Any
difference between such assumptions and the actual characteristics and
performance of the Mortgage Loans, or actual prepayment or loss experience,
will cause the percentages of initial Class Certificate Principal Amounts
outstanding over time and the weighted average lives of the Offered
Certificates to differ (which difference could be material) from the
corresponding information in the tables for each indicated percentage of [
].

Subject to the foregoing discussion and assumptions, the following
tables indicate the weighted average lives of the Offered Certificates and
set forth the percentages of the initial Class Certificate Principal Amounts
of the Offered Certificates that would be outstanding after each of the
Distribution Dates shown at various percentages of [ ].

PERCENTAGE OF INITIAL CLASS CERTIFICATE PRINCIPAL AMOUNT OF THE
OFFERED CERTIFICATES OUTSTANDING AT THE FOLLOWING PERCENTAGES OF [ ]

<TABLE>
<CAPTION>
CLASS [ ] CERTIFICATES
DISTRIBUTION DATE % % % % % % %
<S> <C> <C> <C> <C> <C> <C> <C>
Initial Percentage 100% 100% 0% 0% 0% 0% 0%

Weighted Average Life in Years**

</TABLE>

__________

* Indicates a value between 0.0% and 0.5%.

** The weighted average life of an Offered Certificate is determined by (i)
multiplying the net reduction, if any, of the Class Certificate Principal
Amount by the number of years from the date of issuance of the Offered
Certificate to the related Distribution Date, (ii) adding the results and
(iii) dividing the sum by the aggregate of the net reductions of Class
Certificate Principal Amount described in (i) above.

CERTAIN FEDERAL INCOME TAX CONSIDERATIONS

GENERAL

An election will be made to treat the Trust Fund as a REMIC for federal
income tax purposes. In the opinion of Brown & Wood LLP, assuming compliance
with all provisions of the Trust Agreement, for federal income tax purposes
the Trust Fund will qualify as a REMIC pursuant to Section 860D of the
Internal Revenue Code of 1986, as amended (the "Code"), the Offered
Certificates other than the Class R Certificate will be considered to be
"regular interests" in the REMIC within the meaning of the Code, and the
Class R Certificate will be considered to be the sole class of "residual
interest" in the REMIC within the meaning of the Code. See "CERTAIN FEDERAL
INCOME TAX CONSIDERATIONS" in the Prospectus.

Although the matter is not free from doubt, the Depositor intends to report
stated interest on the Offered Certificates as "qualified stated interest."

The Offered Certificates may be issued with original issue discount for
federal income tax purposes. See "CERTAIN FEDERAL INCOME TAX CONSIDERATIONS--
Taxation of Regular Interest Certificates -- Interest and Acquisition
Discount" in the Prospectus. The prepayment assumption that will be used in
determining the rate of accrual of original issue discount, market discount
and premium, if any, for federal income tax purposes will be a rate equal to
[ ]% [ ]. No representation is made that the Mortgage Loans will prepay
at these rates or at any other rates. Original issue discount must be
included in income as it accrues on a constant yield method, regardless or
whether a holder receives concurrently the cash attributable to such original
issue discount.

[RESIDUAL CERTIFICATES

Special tax considerations apply to an investment in Residual Certificates.
In certain circumstances, the method of taxation of Residual Certificates can
produce a significantly less favorable after-tax return for beneficial owners
of Residual Certificates than would be the case if (i) Residual Certificates
were taxable as debt instruments or (ii) no portion of the taxable income on
a Residual Certificate in each period were treated as "excess inclusion"
income. See "CERTAIN FEDERAL INCOME TAX CONSIDERATIONS--Taxation of Holders
of Residual Interest Certificates" in the Prospectus.

Residual Certificates may not be transferred, sold, pledged or otherwise
assigned unless, prior to such transfer, the proposed transferee delivers to
the Trustee an affidavit certifying that such transferee is not a
Disqualified Organization and is not purchasing a Residual Certificate on
behalf of a Disqualified Organization and certifying as to such matters as
may be necessary to verify that no significant purpose of such transfer is to
impede the assessment or collection of tax, including the ability of such
transferee to pay applicable taxes. In addition, Residual Certificates may
not be held by a nominee. Each proposed transferee must also sign a
transferee letter which, in the case of a transfer to or from a Nonresident,
generally would require furnishing evidence that such transfer would be
respected for federal income tax purposes.)

For further information regarding the federal income tax consequences of
investing in the Offered Certificates, see "CERTAIN FEDERAL INCOME TAX
CONSIDERATIONS" in the Prospectus.

LEGAL INVESTMENT CONSIDERATIONS

The Senior Certificates and the Class [ ] Certificates will constitute
"mortgage related securities" for purposes of the Secondary Mortgage Market
Enhancement Act of 1984 ("SMMEA") for so long as they are rated in one of the
two highest rating categories by one or more nationally recognized
statistical rating agencies, and, as such, are legal investments for certain
entities to the extent provided in SMMEA. Such investments, however, will be
subject to general regulatory considerations governing investment practices
under state and federal laws.

Moreover, institutions whose investment activities are subject to review by
certain regulatory authorities may be or may become subject to restrictions,
which may be retroactively imposed by such regulatory authorities, on the
investment by such institutions in certain mortgage related securities. In
addition, several states have adopted or may adopt regulations that prohibit
certain state-chartered institutions from purchasing or holding similar types
of securities.

Accordingly, investors should consult their own legal advisors to determine
whether and to what extent the Offered Certificates may be purchased by such
investors.

USE OF PROCEEDS

The net proceeds from the sale of the Offered Certificates will be applied
by the Depositor, or an affiliate thereof, toward the purchase of the
Mortgage Loans. The Mortgage Loans will be acquired by the Depositor from the
Seller in a privately negotiated transaction.

UNDERWRITING

Subject to the terms and conditions set forth in the underwriting agreement
and in a terms agreement (collectively, the "Underwriting Agreement") between
the Depositor and the Underwriter, the Depositor has agreed to sell to the
Underwriter, and the Underwriter has agreed to purchase from the Depositor,
all of the Offered Certificates.

The distribution of the Offered Certificates by the Underwriter will be
effected in each case from time to time in one or more negotiated
transactions, or otherwise, at varying prices to be determined, in each case,
at the time of sale. The Underwriter may effect such transactions by selling
the Certificates to or through dealers, and such dealers may receive from the
Underwriter, for whom they act as agent, compensation in the form of
underwriting discounts, concessions or commissions. The Underwriter and any
dealers that participate with the Underwriter in the distribution of the
Certificates may be deemed to be an underwriter, and any discounts,
commissions or concessions received by them, and any profit on the resale of
the Certificates purchased by them, may be deemed to be underwriting
discounts and commissions under the Securities Act of 1933, as amended (the
"Act"). The Underwriting Agreement provides that the Depositor will indemnify
the Underwriter against certain civil liabilities, including liabilities
under the Act.

Lehman Brothers Inc. has entered into an agreement with the Depositor to
purchase the Class [ ] Certificates simultaneously with the purchase of
the Offered Certificates, subject to certain conditions.

Lehman Brothers Inc. is an affiliate of the Depositor.

ERISA CONSIDERATIONS

A fiduciary of any employee benefit plan or other retirement arrangement
subject to the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or the Code should carefully review with its legal advisors
whether the purchase or holding of Certificates could give rise to a
transaction prohibited or not otherwise permissible under ERISA or the Code.
See "ERISA CONSIDERATIONS" in the accompanying Prospectus.

LEGAL MATTERS

Certain legal matters with respect to the Certificates will be passed upon
for the Depositor and for the Underwriter by Brown & Wood LLP, Washington,
D.C.

RATINGS

It is a condition to the issuance of the Class [ ] Certificates that
they be rated "[ ]" by [ ]. It is a condition to the issuance of the
Class [ ] Certificates that they be rated "[ ]," "[ ]" and "[
]," respectively, by [ ]. The rating of "AAA" is the highest rating
that S&P and Fitch assign to securities. A securities rating is not a
recommendation to buy, sell or hold securities and may be subject to revision
or withdrawal at any time by the assigning rating organization.

A securities rating addresses the likelihood of the receipt by Offered
Certificateholders of distributions in the amount of scheduled payments on
the Mortgage Loans. The rating takes into consideration the characteristics
of the Mortgage Loans and the structural, legal and tax aspects associated
with the Offered Certificates. The ratings assigned to the Offered
Certificates do not represent any assessment of the likelihood or rate of
principal prepayments. The ratings do not address the possibility that the
Offered Certificateholders might suffer a lower than anticipated yield due to
prepayments or may fail to recoup their initial investments.

The security ratings assigned to the Offered Certificates should be
evaluated independently from similar ratings on other types of securities. A
security rating is not a recommendation to buy, sell or hold securities and
may be subject to revision or withdrawal at any time by the Rating Agencies.

The Depositor has not requested a rating of the Offered Certificates by any
rating agency other than the Rating Agencies; there can be no assurance,
however, as to whether any other rating agency will rate the Offered
Certificates or, if it does, what rating would be assigned by such other
rating agency. The rating assigned by such other rating agency to the Offered
Certificates could be lower than the respective ratings assigned by the
Rating Agencies.

GLOSSARY

Defined terms Page
- ------------- ----

not constitute an offer to sell or
a solicitation of an offer to buy
No person has been authorized to any securities other than the
give any information or to make securities offered hereby nor an
any representation other than offer of such securities to any
those contained in this Prospectus person in any state or other
Supplement or the Prospectus and, jurisdiction in which such offer
if given or made, such information would be unlawful. The delivery of
or representation must not be this Prospectus Supplement and the
relied upon. This Prospectus Prospectus at any time does not
Supplement and the Prospectus do imply that information herein is
correct as of any time subsequent ERISA Considerations
to their respective dates. Legal Investment
Legal Matters
_______________ The Depositor
Use of Proceeds
TABLE OF CONTENTS Plan of Distribution
Glossary
PROSPECTUS SUPPLEMENT

PAGE
----
Summary S-
Risk Factors S-
Description of the CertificatesS - $[ ]
(APPROXIMATE)
Description of the Mortgage PoolS-

Additional Information S-
Boston Safe Deposit and Trust
Company S-
Servicing of the Mortgage LoansS -
STRUCTURED ASSET
Trust Agreement S- SECURITIES CORPORATION
Yield, Prepayment and Weighted
Average Life S-
Certain Federal Income Tax MORTGAGE PASS-THROUGH CERTIFICATES
Considerations S- SERIES [ ]
Legal Investment ConsiderationsS -

Use of Proceeds S-
Underwriting S-
ERISA Considerations S-
Legal Matters S- [ ]
Ratings S- [Servicer/Master Servicer]
Glossary S-

PROSPECTUS

PAGE _______________
----
Prospectus Supplement PROSPECTUS SUPPLEMENT
Additional Information
Incorporation of Certain Documents [ ]
by Reference _______________
Reports to Certificateholders
Summary of Terms of the
Certificates
Risk Factors
Description of the Certificates
Yield, Prepayment and Maturity
Considerations LEHMAN BROTHERS
The Trust Funds
Loan Underwriting Procedures and
Standards
Servicing of Loans
Credit Support
Description of Mortgage and Other
Insurance
The Trust Agreements
Certain Legal Aspects of Loans
Certain Federal Income Tax
Considerations
State Tax Considerations

SUBJECT TO COMPLETION DATE ( )

PROSPECTUS

Structured Asset Securities Corporation
Depositor

Asset Trust Pass-Through Certificates
(Issuable In Series)

This Prospectus relates to Asset Trust Pass-Through Certificates (the
"Certificates") which may be sold from time to time under this Prospectus and
related Prospectus Supplement in one or more series (each a "Series") by
Structured Asset Securities Corporation (the "Depositor"). (Capitalized terms
not otherwise defined herein shall have the meaning specified in the Glossary
attached hereto.)

Each Certificate of a Series will evidence a beneficial ownership
interest in assets deposited into a trust (a "Trust Fund") by the Depositor
pursuant to a Trust Agreement executed by the Depositor, the Trustee and,
where applicable, the Servicer or Master Servicer for such Series specified
in the related Prospectus Supplement. The Trust Fund will consist of Primary
Assets, which may include Mortgage Loans or participation interests therein,
Manufactured Home Loans or participation interests therein, FHLMC
Certificates, GNMA Certificates, FNMA Certificates (collectively, "Agency
Certificates") Private Mortgage-Backed Securities or any combination of the
foregoing and other assets, including any insurance policies, reserve funds
or other forms of credit support specified in the related Prospectus
Supplement. Manufactured Home Loans and Mortgage Loans in the Trust Fund for
a Series will have been originated by various financial institutions and
other entities engaged generally in the business of originating and/or
servicing housing loans. Mortgage Loans and Manufactured Home Loans may
include (without limitation) fixed rate or adjustable rate Conventional
Loans, FHA Loans or VA Loans and may provide for graduated equity, graduated
payment, "buy-down" or other payment features, and may call for payments from
the obligors other than monthly, as specified in the related Prospectus
Supplement. Mortgage Loans underlying or comprising the Primary Assets will
be secured by property consisting of single family (one-to-four family)
attached or detached residential housing or multifamily residential rental
properties or cooperatively owned properties consisting of five or more
attached or detached dwelling units. Mortgage Loans that are Cooperative
Loans will be secured by assignments of shares and a proprietary lease or
occupancy agreement on a cooperative apartment. Manufactured Home Loans
underlying or comprising the Primary Assets will be secured by property
consisting of a Manufactured Home. See "THE TRUST FUNDS" herein. Manufactured
Home Loans and Mortgage Loans (or participation interests therein) may be
serviced by a Servicer, which may employ one or more subservicers, by various
servicers under the supervision of a Master Servicer or by the Master
Servicer directly, as specified in the related Prospectus Supplement.

Each Series of Certificates will consist of one or more Classes, and any
Class may include subclasses. If a Series includes multiple Classes, such
Classes may vary with respect to the amount, percentage and timing of
distributions of principal, interest or both and one or more Classes may be
subordinated to other Classes with respect to distributions of principal,
interest or both as described herein and in the related Prospectus
Supplement. If so specified in the related Prospectus Supplement, the Primary
Assets held under the Trust Agreement may be divided into one or more Asset
Groups. A Series or Class of Certificates may be subject to redemption in
certain circumstances if so specified in the related Prospectus Supplement.
See "DESCRIPTION OF THE CERTIFICATES" herein.

Distributions of principal and interest on the Certificates of each
Series will be made on each Distribution Date for a Series. The rate of
reduction of the aggregate principal balance of each Class of a Series will
depend principally upon the rate of payment (including prepayments) with
respect to the Loans comprising or underlying the Primary Assets. A rate of
prepayment lower or higher than anticipated will affect the yields on
Certificates of a Series in the manner described herein and in the related
Prospectus Supplement. Under certain limited circumstances described herein
and in the related Prospectus Supplement, the Primary Assets may be purchased
by the entity specified in the related Prospectus Supplement and the related
Trust Fund terminated prior to the maturity of the Primary Assets or the
Final Scheduled Distribution Date of the Certificates of the related Series.
If so specified in the related Prospectus Supplement, Certificates of a
Series may be subject to special distributions in reduction of principal
balance under certain circumstances. See "DESCRIPTION OF THE CERTIFICATES"
and "YIELD, PREPAYMENT AND MATURITY CONSIDERATIONS" herein.

The Certificates evidence an interest in the related Trust Fund only,
and are not guaranteed by any governmental agency, or by the Depositor, the
Trustee, any Servicer or Master Servicer, or by any of their respective
affiliates or, unless otherwise specified in the related Prospectus
Supplement, by any other person or entity. The Depositor's only obligations
with respect to any Series will be pursuant to certain representations and
warranties set forth in the related Trust Agreement as described herein or in
the related Prospectus Supplement. See "THE TRUST AGREEMENTS" herein.

If specified in the related Prospectus Supplement, one or more elections
may be made to treat the Trust Fund for a Series or specified portions
thereof as a "real estate mortgage investment conduit" (a "REMIC") or as a
"financial asset securitization investment trust" (a "FASIT") for federal
income tax purposes. See "CERTAIN FEDERAL INCOME TAX CONSIDERATIONS" herein.

Certificates of a Series offered hereby and by the related Prospectus
Supplement may be offered through one or more different methods, including
offerings through Lehman Brothers Inc., an affiliate of the Depositor, as
more fully described herein and in the related Prospectus Supplement. See
"PLAN OF DISTRIBUTION" herein.

Potential investors should consider, among other things, the information
set forth in "RISK FACTORS" on page ( ).

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.

THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS NOT PASSED ON OR ENDORSED
THE MERITS OF THIS OFFERING. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.

*****************************************************************************
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement
becomes effective. This prospectus shall not constitute an offer to sell or
the solicitation of an offer to buy nor shall these be any sale of these
securities in any state in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws of
any such state.
*****************************************************************************

The Certificates are offered when, as and if delivered to and accepted
by the Underwriters subject to prior sale, withdrawal or modification of the
offer without notice, the approval of counsel and other conditions. Retain
this Prospectus for future reference. This Prospectus may not be used to
consummate sales of the securities offered hereby unless accompanied by a
Prospectus Supplement.

LEHMAN BROTHERS
The date of this Prospectus is February ___, 1998

PROSPECTUS SUPPLEMENT

The Prospectus Supplement relating to each Series of Certificates will,
among other things, set forth with respect to such Series: (a) the aggregate
initial principal balance, the Certificate Interest Rate (or method for
determining it) and authorized denominations of each Class of such Series;
(b) certain information concerning the Trust Fund for such Series, including
the principal amount, type and characteristics of Primary Assets included in
the Trust Fund on the date of issue, and, if applicable, the amount of
Reserve Funds, if any, for such Series; (c) information as to the Trustee and
any Servicer or Master Servicer for a Series, and, where Private Mortgage-
Backed Securities are included in the Trust Fund, information concerning the
PMBS Issuer, the PMBS Trustee, the PMBS Servicer, if any, and the Loans or
Agency Certificates which constitute the underlying assets for such Private
Mortgage-Backed Securities; (d) the circumstances, if any, under which
special distributions of principal may be made or a Trust Fund terminated
prior to the Final Scheduled Distribution Date; (e) the Final Scheduled
Distribution Date of each Class of a Multi-Class Series; (f) the method used
to calculate the aggregate amount of principal to be distributed with respect
to the Certificates of such Series on each Distribution Date; (g) the order
of the application of principal distributions to the respective Classes and
the allocation of principal to be so applied; (h) the extent of subordination
of each Class of Subordinate Certificates, if any; (i) the Distribution Dates
for the respective Classes; (j) additional information with respect to any
certificate guarantee insurance policy, pool insurance policy, special hazard
insurance policy, bankruptcy bond or repurchase bond or other credit support,
if any, relating to the Series or the Primary Assets; (k) whether one or more
REMIC elections will be made, and if any such election is made the
designation of the regular interests and residual interests; (l) whether a
FASIT election will be made with respect to the Trust Fund , and if so, the
designation of the regular interests and the ownership interest; and (m) the
plan of distribution for such Series.

ADDITIONAL INFORMATION

The Depositor has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement under the Securities Act of 1933, as
amended, with respect to the Certificates. This Prospectus, which forms a
part of the Registration Statement, omits certain information contained in
such Registration Statement pursuant to the Rules and Regulations of the
Commission. The Registration Statement and the exhibits thereto can be
inspected and copied at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and at certain
of its Regional Offices located as follows: Chicago Regional Office, Citicorp
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511;
and New York Regional Office, 7 World Trade Center, Suite 1300, New York, New
York 10048. Copies of such material can also be obtained from the Public
Reference Section of the Commission, 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates.

The Commission also maintains a site on the World Wide Web at
"http://www.sec.gov" at which users can view and download copies of reports,
proxy and information statements and other information filed electronically
through the Electronic Data Gathering, Analysis and Retrieval ("EDGAR")
system. The Seller has filed the Registration Statement, including all
exhibits thereto, through the EDGAR system and therefore such materials
should be available by logging onto the Commission's Web site. The
Commission maintains computer terminals providing access to the EDGAR system
at each of the offices referred to above.

Copies of the most recent FNMA Prospectus for FNMA Certificates and
FNMA's annual report and quarterly financial statements as well as other
financial information are available from the Director of Investor Relations
of FNMA, 3900 Wisconsin Avenue, N.W., Washington, D.C. 20016 (202-752-7115).
The Depositor did not participate in the preparation of FNMA's Prospectus or
its annual or quarterly reports or other financial information and,
accordingly, makes no representation as to the accuracy or completeness of
the information set forth therein.

Copies of the most recent Offering Circular for FHLMC Certificates as
well as FHLMC's most recent Information Statement and Information Statement
Supplement and any quarterly report made available by FHLMC can be obtained
by writing or calling the Investor Inquiry department of FHLMC at 8200 Jones
Branch Drive, McLean, Virginia 22102 (outside Washington, D.C. metropolitan
area, telephone 800-336-3672; within Washington, D.C. metropolitan area,
telephone 703-759-8160). The Depositor did not participate in the preparation
of FHLMC's Offering Circular, Information Statement or any supplement thereto
or any quarterly report thereof and, accordingly, makes no representations as
to the accuracy or completeness of the information set forth therein.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

All documents subsequently filed by or on behalf of the Trust Fund
referred to in the accompanying Prospectus Supplement with the Commission
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), after the date of this Prospectus
and prior to the termination of any offering of the Certificates issued by
such Trust Fund shall be deemed to be incorporated by reference in this
Prospectus and to be a part of this Prospectus from the date of the filing of
such documents. Any statement contained in a document incorporated or deemed
to be incorporated by reference herein shall be deemed to be modified or
superseded for all purposes of this Prospectus to the extent that a statement
contained herein (or in the accompanying Prospectus Supplement) or in any
other subsequently filed document which also is or is deemed to be
incorporated by reference modifies or replaces such statement. Any such
statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.

The Trustee on behalf of any Trust Fund will provide without charge to
each person to whom this Prospectus is delivered, on the written or oral
request of such person, a copy of any or all of the documents referred to
above that have been or may be incorporated by reference in this Prospectus
(not including exhibits to the information that is incorporated by reference
unless such exhibits are specifically incorporated by reference into the
information that this Prospectus incorporates). Such requests should be
directed to the Corporate Trust Office of the Trustee specified in the
accompanying Prospectus Supplement.

REPORTS TO CERTIFICATEHOLDERS

Periodic and annual reports concerning the related Trust Fund are
required under the Trust Agreement to be forwarded to Certificateholders.
Unless otherwise specified in the related Prospectus Supplement, such reports
will not be examined and reported on by an independent public accountant. See
"THE TRUST AGREEMENTS--Reports to Certificateholders" herein.

SUMMARY OF TERMS OF THE CERTIFICATES

The following is qualified in its entirety by reference to the detailed
information appearing elsewhere in this Prospectus and in the Prospectus
Supplement with respect to the Series offered thereby and to the Trust
Agreement for such Series. All capitalized terms not otherwise defined in
this Prospectus or the related Prospectus Supplement for a Series have the
respective meanings assigned to them in the "GLOSSARY."

Securities Offered . . . . . . . . The Asset Trust Pass-Through Certificates
(the "Certificates") are issuable from
time to time in separate Series pursuant
to separate Trust Agreements. Each
Certificate of a Series will evidence a
beneficial ownership interest in the Trust
Fund for such Series, or in an Asset Group
specified in the related Prospectus
Supplement. The Certificates will be
issuable in registered form in the
authorized minimum denominations and
multiples thereof specified in the related
Prospectus Supplement. If so specified in
the related Prospectus Supplement, the
Certificates or certain Classes of such
Certificates offered thereby may be
available in book-entry form only.

The Certificates of a Series will evidence
interests in the related Trust Fund only
and will not be guaranteed by any
governmental agency, by the Depositor, the
Trustee, any Servicer or Master Servicer
or by any of their respective affiliates,
or unless otherwise specified in the
related Prospectus Supplement, by any
other person or entity. See "SPECIAL
CONSIDERATIONS" and "CREDIT SUPPORT"
herein.

Each Series of Certificates will consist
of one or more Classes. If a Series
consists of multiple Classes, the
respective Classes may differ with respect
to the amount, percentage and timing of
distributions of principal, interest or
both. Additionally, one or more Classes
may consist of Subordinate Certificates
which are subordinated to other Classes of
Certificates with respect to the right to
receive distributions of principal,
interest, or both under the circumstances
and in such amounts as described herein
and in the related Prospectus Supplement.
Any Class of Certificates of a Series will
be offered hereby and by the related
Prospectus Supplement only if rated by at
least one Rating Agency in one of its four
highest rating categories. See
"DESCRIPTION OF THE CERTIFICATES--
General," "CREDIT SUPPORT--Subordinate
Certificates" and "Special Considerations"
herein.

Depositor . . . . . . . . . . . . Structured Asset Securities Corporation, a
Delaware corporation (the "Depositor"), is
a limited purpose corporation organized
primarily for the purpose of acquiring the
Primary Assets for each Trust Fund. The
principal executive offices of the
Depositor are located at 200 Vesey Street,
New York, New York 10285 and its telephone
number is (212) 526-5594. All of the
outstanding capital stock of the Depositor
is owned by Lehman Commercial Paper
Incorporated, a wholly-owned subsidiary of
Lehman Brothers Inc. The Depositor's only
obligations with respect to the
Certificates will be pursuant to certain
representations and warranties described
herein under "THE TRUST AGREEMENTS."
Neither the Depositor, its parent nor any
affiliate of the Depositor will guarantee
the Certificates or the assets included in
the Trust Fund for a Series. See "SPECIAL
CONSIDERATIONS" and "THE DEPOSITOR."

Trustee . . . . . . . . . . . . . The Trustee with respect to a Series will
be specified in the related Prospectus
Supplement. See "THE TRUST AGREEMENTS"
herein for a description of the Trustee's
rights and obligations.

Interest Distributions . . . . . . Interest distributions on the Certificates
of a Series will be made from amounts
available therefor in the related
Certificate Account on each Distribution
Date at the applicable Certificate
Interest Rate specified in (or determined
in the manner set forth in) the related
Prospectus Supplement. The Certificate
Interest Rate on Certificates of a Series
may be variable and change with changes in
the mortgage rates or pass-through rates
of the Primary Assets included in the
related Trust Fund and/or as prepayments
occur with respect to such Primary Assets,
or may be a floating rate of interest
determined from time to time as specified
in the related Prospectus Supplement.

A Class or Classes of Certificates of a
Series may be entitled to distributions of
interest only or of no interest, or be
entitled to nominal interest or principal
distributions, and may accrue interest
that is, for a period of time, not
distributed thereon but instead is added
to the principal balance thereof. See
"DESCRIPTION OF THE CERTIFICATES" and
"YIELD, PREPAYMENT AND MATURITY
CONSIDERATIONS" herein.

Principal Distributions . . . . . Principal distributions on the
Certificates of a Series will be made from
amounts available therefor in the related
Certificate Account on each Distribution
Date in an aggregate amount determined as
specified in the related Prospectus
Supplement. Principal distributions will
be allocated among the respective Classes
of a Series in the manner and in the
priority (which may include allocation by
request, random lot, or other means) set
forth in the related Prospectus
Supplement.

A Class or Classes of Certificates may not
be entitled to any principal distributions
or may be entitled to receive only nominal
principal distributions.

To the extent specified in the related
Prospectus Supplement, Certificates of a
Series having other than monthly
Distribution Dates may be subject to
special distributions of principal if, as
a result of principal prepayments with
respect to the Loans (as defined below)
comprising or underlying the Primary
Assets in the related Trust Fund, low
reinvestment yields or both, it is
determined (based on assumptions specified
in the related Trust Agreement) that the
amount of cash anticipated to be available
in the Certificate Account for such Series
on the next Distribution Date may be less
than the scheduled distributions to be
made on such Distribution Date. See
"DESCRIPTION OF THE CERTIFICATES" and
"YIELD, PREPAYMENT AND MATURITY
CONSIDERATIONS" herein.

Final Scheduled Distribution Date The Final Scheduled Distribution Date for
each Class of a Series will be the date
after which no Certificates of such Class
will remain outstanding, on the basis of
the assumption that timely payments or
distributions are made on the Primary
Assets in the related Trust Fund in
accordance with their terms and any other
assumptions set forth in the related
Prospectus Supplement. The Final Scheduled
Distribution Date of a Class will be
determined as described herein and in the
related Prospectus Supplement.

The actual maturity date of the
Certificates of a Series will depend
primarily upon the level of prepayments
with respect to the Loans comprising or
underlying the Primary Assets in the
related Trust Fund. The actual maturity of
any Certificate is likely to occur earlier
and may occur substantially earlier than
its Final Scheduled Distribution Date as a
result of the application of prepayments
to the reduction of the principal balances
of the Certificates. The rate of
prepayments on the Loans comprising or
underlying Primary Assets in the Trust
Fund for a Series will depend on a variety
of factors, including certain
characteristics of such Loans and the
prevailing level of interest rates from
time to time, as well as on a variety of
economic, demographic, tax, legal, social
and other factors. No assurance can be
given as to the actual prepayment
experience with respect to a Series. See
"RISK FACTORS" and "YIELD, PREPAYMENT AND
MATURITY CONSIDERATIONS" herein.

Optional Termination . . . . . . . If so specified in the related Prospectus
Supplement, the Depositor, the Servicer or
Master Servicer, or such other entity that
is specified in the related Prospectus
Supplement, including the holder of the
residual interest in a REMIC or the holder
of an ownership interest in a FASIT, may,
at its option, cause an early termination
of the related Trust Fund by repurchasing
all of the Primary Assets remaining in the
Trust Fund on or after a specified date,
or on or after such time as the Aggregate
Asset Principal Balance of the Primary
Assets or the aggregate Principal Amount
of the Certificates (or of certain Classes
thereof), as specified in the related
Prospectus Supplement, is less than the
amount or percentage specified in the
related Prospectus Supplement. See
"DESCRIPTION OF THE CERTIFICATES--Optional
Termination" herein.

Repurchases of Certificates . . . If so specified in the related Prospectus
Supplement, one or more Classes of the
Certificates of such Series may be
repurchased, in whole or in part, at the
option of the Depositor, at such times and
under the circumstances specified in such
Prospectus Supplement and at the
repurchase price set forth therein. See
"DESCRIPTION OF THE CERTIFICATES" herein.

If so specified in the related Prospectus
Supplement, any Class of the Certificates
may be subject to repurchase, in whole or
in part, at the request of the holders of
such Class or to mandatory repurchase by
the Depositor (including by random lot or
other means). See "DESCRIPTION OF THE
CERTIFICATES" herein.

The Trust Fund . . . . . . . . . . The Trust Fund for a Series will consist
of Private Mortgage-Backed Securities,
Agency Certificates, Mortgage Loans or
participation interests therein,
Manufactured Home Loans or participation
interests therein, or any combination of
the foregoing (the "Primary Assets"),
together with certain accounts, reserve
funds, insurance policies and related
agreements specified in the related
Prospectus Supplement. (Mortgage Loans and
Manufactured Home Loans are referred to
herein as "Loans".) If so specified in the
related Prospectus Supplement, the Primary
Assets may be divided into Asset Groups.
The Trust Fund for a Series will also
include the Collection Account and the
Certificate Account, and may include
certain policies of insurance relating to
the Primary Assets, and any of various
forms of credit support, all as specified
in the related Prospectus Supplement. See
"THE TRUST FUNDS--Collection Account and
Certificate Account," "CREDIT SUPPORT" and
"DESCRIPTION OF MORTGAGE AND OTHER
INSURANCE" herein.

a. Primary Assets . . . . . . . . The Primary Assets for a Series of
Certificates may consist of any
combination of the following, to the
extent and as specified in the related
Prospectus Supplement (such Prospectus
Supplement may contain information on an
approximate basis as of the Cut-off Date,
in which case a report on Form 8-K
containing additional information will be
available to purchasers of the
Certificates at or promptly after initial
issuance):

(1) Agency Certificates and Private
Mortgage-Backed Securities . . Agency Certificates may include:

(A) GNMA Certificates. GNMA's guarantee
is backed by the full faith and credit of
the United States. See "THE TRUST FUNDS--
GNMA Certificates."

(B) FNMA Certificates. FNMA's guarantee
is not backed by the full faith and credit
of the United States. See "THE TRUST
FUNDS--FNMA Certificates."

(C) FHLMC Certificates. FHLMC's guarantee
is not backed by the full faith and credit
of the United States. See "THE TRUST
FUNDS--FHLMC Certificates."

Private Mortgage-Backed Securities may
include (a) mortgage participations or
pass-through certificates representing
beneficial interests in Agency
Certificates or Loans or (b)
collateralized mortgage obligations
secured by Agency Certificates or Loans.
Although individual Loans or Agency
Certificates underlying a Private
Mortgage-Backed Security may be insured or
guaranteed by the United States or an
agency or instrumentality thereof, they
need not be, and the Private Mortgage-
Backed Securities themselves will not be
so insured or guaranteed. See "THE TRUST
FUNDS--Private Mortgage-Backed
Securities." Unless otherwise specified in
the Prospectus Supplement relating to a
Series of Certificates, payments on the
Private Mortgage-Backed Securities will be
distributed directly to the Trustee as
registered owner of such Private Mortgage-
Backed Securities. See "THE TRUST FUNDS--
Private Mortgage-Backed Securities"
herein.

The related Prospectus Supplement for a
Series will specify (such disclosure may
be on an approximate basis, as described
above), to the extent relevant: (i) the
aggregate approximate principal amount and
type of any Agency Certificates and
Private Mortgage-Backed Securities to be
included in the Trust Fund for such
Series; (ii) certain characteristics of
the Agency Certificates or Loans which
comprise the underlying assets for the
Private Mortgage-Backed Securities
including, in the case of Loans, (A) the
payment features of such Loans (i.e.,
whether they are fixed rate or adjustable
rate and whether they provide for fixed
level payments, negative amortization, or
other payment features), (B) the
approximate aggregate principal amount, if
known, of the underlying Loans which are
insured or guaranteed by a governmental
entity, (C) the servicing fee or range of
servicing fees with respect to the Loans,
and (D) the minimum and maximum stated
maturities of the Loans at origination;
(iii) the maximum original term-to-stated
maturity of the Private Mortgage-Backed
Securities; (iv) the weighted average
term-to-stated maturity of the Private
Mortgage-Backed Securities; (v) the pass-
through or certificate rate or ranges
thereof for the Private Mortgage-Backed
Securities; (vi) the weighted average
pass-through or certificate rate of the
Private Mortgage-Backed Securities; (vii)
the Issuer of the Private Mortgage-Backed
Securities (the "PMBS Issuer"), the
Servicer of the Private Mortgage-Backed
Securities (the "PMBS Servicer") and the
trustee of the Private Mortgage-Backed
Securities (the "PMBS Trustee"); (viii)
certain characteristics of credit support,
if any, such as Reserve Funds, Insurance
Policies, letters of credit or guarantees,
relating to the Loans underlying the
Private Mortgage-Backed Securities, or to
such Private Mortgage-Backed Securities
themselves; (ix) the terms on which
underlying Loans for such Private
Mortgage-Backed Securities may, or are
required to, be repurchased prior to
stated maturity; and (x) the terms on
which substitute Loans or Agency
Certificates may be delivered to replace
those initially deposited with the PMBS
Trustee. See "THE TRUST FUNDS" herein.

(2) Mortgage Loans . . . . . . . . Primary Assets for a Series may consist,
in whole or in part, of Mortgage Loans or
participation interests therein.
Participation interests in Mortgage Loans
will be purchased pursuant to
participation agreements. See "THE TRUST
FUNDS--General" herein. Payments on
Mortgage Loans will be collected by the
Master Servicer or Servicer, as specified
in the related Prospectus Supplement, and
such payments (net of servicing fees and
certain other amounts) will be available
to make distributions on the Certificates
of that Series. See "SERVICING OF LOANS"
herein. Mortgage Loans may, as specified
in the related Prospectus Supplement,
include Conventional Loans, FHA Loans or
VA Loans, may have various payment
characteristics and may include growing
equity mortgage loans ("GEM Loans"),
graduated payment mortgage loans ("GPM
Loans"), buy-down mortgage loans ("Buy-
Down Loans"), bi-weekly payment loans
("Bi-Weekly Loans") or Loans having
balloon payments or other special payment
features. The Mortgage Loans may have
fixed or adjustable interest rates
(Mortgage Loans having such adjustable
rates are hereinafter sometimes referred
to as "Adjustable Rate Mortgages" or
"ARMs"). ARMs will, as described in the
related Prospectus Supplement, permit or
require periodic changes in the mortgage
rate and in the scheduled payments of
principal and interest due from the
obligor on the related Mortgage Note. The
Mortgage Loans may include Mortgage Loans
secured by mortgages, deeds of trust or
other similar security instruments
creating a first lien or, if so specified
in the related Prospectus Supplement, a
second lien, on related Mortgaged
Properties, or on borrower's leasehold
interest in real property. The Mortgage
Loans may include Cooperative Loans
secured by an assignment by the borrower
(the "tenant-stockholder") of a security
interest in shares issued by a private,
non-profit, cooperative housing
association (a "Cooperative") and the
related proprietary lease or occupancy
agreement on a cooperative dwelling (the
"Cooperative Dwelling"). The Mortgage
Loans may also include Condominium Loans
secured by a Mortgage on the Condominium
Unit, together with such Condominium
Unit's appurtenant interest in the common
elements. The Mortgaged Properties may
consist of one to four-family attached or
detached residential housing (including
shares in a Cooperative and the related
proprietary lease or occupancy agreement)
("Single Family Property") or multifamily
residential rental property or
cooperatively owned multifamily properties
consisting of five or more dwelling units
("Multifamily Property"). Single Family
Property may be owner occupied and may
include vacation or second homes or may
consist in whole or in part of non-owner
occupied investment properties, as
specified in the related Prospectus
Supplement.

To the extent described herein or in the
related Prospectus Supplement, Mortgaged
Properties will be covered by standard
hazard insurance policies (which may be
blanket policies) insuring against losses
due to various causes, including fire,
lightning and windstorm. Mortgaged
Properties located in a federally
designated special hazard flood zone will
be required to be covered by flood
insurance. With respect to a Cooperative
Dwelling, the Cooperative is responsible
for maintaining standard hazard insurance
on the real property owned by the
Cooperative, and standard hazard insurance
on the Cooperative Dwelling securing a
Mortgage Loan will not generally be
required. With respect to a Condominium
Unit, the Condominium Association is
responsible for maintaining standard
hazard insurance insuring the entire
Condominium Building and separate standard
hazard insurance on the Condominium Unit
securing a Mortgage Loan will not
generally be required. Unless otherwise
specified in the related Prospectus
Supplement, each first lien Mortgage Loan
that is a Conventional Loan secured by a
Single Family Property having a Loan-to-
Value Ratio exceeding 80% will be required
to be covered by a primary mortgage
insurance policy as described herein or in
the related Prospectus Supplement. To the
extent described herein or in the related
Prospectus Supplement, each Loan (other
than a Cooperative Loan or a Loan secured
by a Manufactured Home) will be covered by
a title insurance policy or, in lieu
thereof, an attorney's opinion of title.
See "DESCRIPTION OF MORTGAGE AND OTHER
INSURANCE" herein.

The related Prospectus Supplement will
describe the principal characteristics of
the Mortgage Loans included in the Trust
Fund (such information may be on an
approximate basis). Unless otherwise
specified in the related Prospectus
Supplement, each Mortgage Loan will have a
10- to 40-year term at origination and a
Loan-to-Value Ratio at origination not
exceeding 95%, and each second lien
Mortgage Loan will have a 5-to 30-year
term at origination and a Loan-to-Value
Ratio at origination not exceeding 125%.

Mortgage Loans that constitute Primary
Assets will be purchased by the Depositor
in the open market or in privately
negotiated transactions, including
transactions with the Servicer or Master
Servicer or with entities affiliated with
the Depositor, the Trustee or the Servicer
or Master Servicer.

(3) Manufactured Home Loans . . . Primary Assets may consist, in whole or in
part, of manufactured housing conditional
sales contracts and installment loan
agreements with respect to Manufactured
Homes (the "Manufactured Home Loans") or
participation interests therein.
Participation interests in Manufactured
Home Loans will be purchased pursuant to a
participation agreement. See "THE TRUST
FUNDS--General."

Each Manufactured Home Loan will be
secured by a new or used Manufactured
Home. A Manufactured Home Loan may be a
Conventional Loan, FHA Loan or VA Loan.
Unless otherwise specified in the related
Prospectus Supplement, Manufactured Home
Loans that are Conventional Loans will not
be covered by primary mortgage insurance
policies. Each Manufactured Home which
secures a Manufactured Home Loan will be
covered by a standard hazard insurance
policy (which may be a blanket policy) to
the extent described herein or in the
related Prospectus Supplement insuring
against hazard losses due to various
causes, including fire, lightning and
windstorm. A Manufactured Home located in
a federally designated special hazard
flood zone will be required to be covered
by flood insurance. See "DESCRIPTION OF
MORTGAGE AND OTHER INSURANCE" herein.

The Prospectus Supplement for each Series
will describe the principal
characteristics of the Manufactured Home
Loans included in the Trust Fund for the
related Series (such information may be on
an approximate basis). Unless otherwise
specified in a related Prospectus
Supplement, each Manufactured Home Loan
will have a 3- to 30-year term at
origination and a Loan-to-Value Ratio at
origination not in excess of 95%.

The Manufactured Home Loans which
constitute Primary Assets will be
purchased by the Depositor in the open
market or in privately negotiated
transactions, including transactions with
the Servicer or Master Servicer or with
entities affiliated with the Depositor,
the Trustee or the Servicer or Master
Servicer.

b. Collection Account and
Certificate Account . . . . . . Payments or distributions with respect to
the Primary Assets for a Series will
initially be remitted for deposit in a
Collection Account maintained by the
Trustee, the Servicer or the Master
Servicer and then transferred to a
Certificate Account to be established with
the Trustee for such Series. The amounts
remitted may be net of servicing fees,
Retained Interests and other amounts
specified in the related Prospectus
Supplement. Amounts so deposited will be
used to make distributions on the
Certificates of such Series on the
applicable Distribution Date. See "THE
TRUST FUNDS--Collection Account and
Certificate Account."

c. Guaranteed Investment Contracts
and Other Agreements . . . . . The Depositor may obtain and deliver to
the Trustee guaranteed investment
contracts or reinvestment agreements
("Guaranteed Investment Contracts")
pursuant to which moneys held in one or
more of the funds and accounts established
for such Series will be invested at a
specified rate which will constitute the
"Assumed Reinvestment Rate" for the
Series. With respect to any Multi-Class
Series which includes a Class of Floating
Rate Certificates, the Depositor may
obtain and deliver to the Trustee an
interest rate swap contract, interest rate
cap agreement or similar contract issued
by a bank, insurance company, savings
bank, savings and loan association or
other entity to provide limited protection
against interest rate risks. The principal
terms of any such Guaranteed Investment
Contract or such other agreement,
including, without limitation, provisions
relating to the timing, manner and amount
of payments thereunder and provisions
relating to the termination thereof,
together with information relating to the
issuer thereof, will be described in the
related Prospectus Supplement.

Pre-Funding Arrangement . . . . . If so specified in the related Prospectus
Supplement, the related Trust Agreement
will contain provisions pursuant to which
the Depositor will agree to transfer
additional Primary Assets (the "Subsequent
Primary Assets") into the related Trust
Fund during a specified period of time
following the date on which the related
Certificates are issued (such provisions
being referred to herein as a "Pre-Funding
Arrangement"). Any such Pre-Funding
Arrangement will require that any Primary
Assets so transferred conform to the
requirements specified in the related
Trust Agreement. See "The Trust Funds --
Pre-Funding Arrangements."

Credit Support . . . . . . . . . . Credit support in the form of reserve
funds, subordination, insurance policies,
letters of credit or other types of credit
support may be provided with respect to
the Primary Assets or with respect to one
or more Classes of Certificates of a
Series. If the Primary Assets are divided
into separate Asset Groups, credit support
may be provided by a cross- support
feature which requires that distributions
be made with respect to Certificates
evidencing beneficial ownership of one
Asset Group prior to distributions to
Certificates evidencing a beneficial
ownership interest in another Asset Group
within the Trust Fund. If so specified in
the related Prospectus Supplement, any
form of credit support (including but not
limited to insurance, letters of credit or
Certificate guarantee insurance) may be
structured so as to be drawn upon by more
than one Trust Fund to the extent
described therein.

The type, characteristics and amount of
credit support will be determined based on
the characteristics of the Loans
underlying or comprising the Primary
Assets and other factors and will be
established on the basis of requirements
of each Rating Agency rating the
Certificates of such Series. The
protection against losses provided by such
credit support will be limited. See
"CREDIT SUPPORT" and "RISK FACTORS"
herein.

a. Subordinate Certificates;
Subordination Reserve Fund . . A Series of Certificates may include one
or more Classes of Subordinate
Certificates. The rights of Holders of
such Subordinate Certificates to receive
distributions on any Distribution Date
will be subordinate in right and priority
to the rights of Holders of Senior
Certificates of the Series, but only to
the extent described in the related
Prospectus Supplement. If so specified in
the related Prospectus Supplement,
subordination may apply only in the event
of (or be limited as to) certain types of
losses not covered by other credit
support, such as hazard losses not covered
by the standard hazard insurance policies,
losses resulting from the bankruptcy of a
borrower due to application of provisions
of the Bankruptcy Code, or losses
resulting from the denial of insurance
coverage due to fraud or misrepresentation
in connection with the origination of a
Loan. Unless otherwise specified in the
related Prospectus Supplement, such
subordination will be in lieu of providing
insurance policies or other credit support
with respect to losses arising from such
events.

A Subordination Reserve Fund may be
established at the level specified in the
related Prospectus Supplement. The related
Prospectus Supplement will also set forth
information concerning the amount of
subordination of a Class or Classes of
Subordinate Certificates in a series, the
circumstances in which such subordination
will be applicable, the manner, if any, in
which the amount of subordination will
decrease over time, the manner of funding
the related Subordination Reserve Fund, if
any, and the conditions under which
amounts in any Subordination Reserve Fund
will be used to make distributions to
Holders of Senior Certificates or be
released from the related Trust Fund. If
cash flows otherwise distributable to
Holders of Subordinate Certificates
evidencing a beneficial ownership interest
in an Asset Group will be used as cross
support for Senior Certificates evidencing
a beneficial ownership interest in another
Asset Group within the Trust Fund, the
related Prospectus Supplement will specify
the manner and conditions for applying
such a cross support feature. See "CREDIT
SUPPORT--Subordinate Certificates;
Subordination Reserve Fund."

b. Insurance . . . . . . . . . . . If so specified in the related Prospectus
Supplement, certain insurance policies in
addition to any primary mortgage insurance
policies or standard hazard insurance
policies described above under "Primary
Assets" will be required to be maintained
with respect to the Loans included in the
Trust Fund for a Series. Such insurance
policies may include, but are not limited
to, (i) a pool insurance policy insuring
against losses due to defaults or
delinquencies in payment, (ii) a special
hazard insurance policy insuring against
losses which are not covered by the
standard hazard insurance policies, (iii)
bankruptcy bonds or insurance policies
insuring losses due to bankruptcy of a
borrower and application of certain
provisions of the Bankruptcy Code and (iv)
repurchase bonds insuring the repurchase
of Loans by the originator of such Loan in
the event of the loss of other insurance
coverage due to certain misrepresentations
in the origination or sale of any such
Loans or in other circumstances specified
in the related Prospectus Supplement. See
"RISK FACTORS," "CREDIT SUPPORT" and
"DESCRIPTION OF MORTGAGE AND OTHER
INSURANCE" herein. The Prospectus
Supplement for a Series will provide
information concerning any such insurance
policies, including (a) the types of
coverage provided by each, (b) the amount
of such coverage, (c) conditions to
payment under each and (d) certain
information relating to the issuers of
such insurance policies. To the extent
described in the related Prospectus
Supplement, certain insurance policies to
be maintained with respect to the Loans
may be terminated, reduced or replaced
following the occurrence of certain events
affecting the authority or
creditworthiness of the insurer.
Additionally, such insurance policies may
be terminated, reduced or replaced by the
Servicer or Master Servicer, provided that
no rating assigned to Certificates of the
related Series offered hereby and by the
related Prospectus Supplement is adversely
affected.

c. Letter of Credit . . . . . . . If so specified in the related Prospectus
Supplement, credit support may be provided
by one or more letters of credit. A letter
of credit may provide limited protection
against certain losses in addition to or
in lieu of other credit support, such as
losses resulting from delinquent payments
on the Loans in the Trust Fund, losses
from risks not covered by standard hazard
insurance policies, losses due to
bankruptcy of a borrower and application
of certain provisions of the Bankruptcy
Code, and losses due to denial of
insurance coverage due to
misrepresentations made in connection with
the origination or sale of a Loan. The
issuer of the letter of credit (the "L/C
Bank") will be obligated to honor demands
with respect to such letter of credit, to
the extent of the amount available
thereunder, to provide funds under the
circumstances and subject to such
conditions as are specified in the related
Prospectus Supplement. The liability of
the L/C Bank under its letter of credit
will be reduced by the amount of
unreimbursed payments thereunder.

The maximum liability of a L/C Bank under
its letter of credit will be an amount
equal to a percentage specified in the
related Prospectus Supplement of the
initial aggregate outstanding principal
balance of the Loans in the Trust Fund or
one or more Classes of Certificates of the
related Series (the "L/C Percentage"). The
maximum amount available at any time to be
paid under a letter of credit will be
determined in the manner specified therein
and in the related Prospectus Supplement.

d. Certificate Guarantee Insurance If so specified in the related Prospectus
Supplement, credit support for a Series
may be provided by an insurance policy
(the "certificate guarantee insurance")
issued by one or more insurance companies.
Such certificate guarantee insurance may,
to the extent specified in the related
Prospectus Supplement, guarantee timely
distributions of interest and full
distributions of principal on the basis of
a schedule of principal distributions or a
Final Scheduled Distribution Date set
forth in or determined in the manner
specified in the related Prospectus
Supplement.

e. Reserve Funds . . . . . . . . . The Depositor may deposit in one or more
reserve funds (collectively the "Reserve
Funds") for any Series cash, Eligible
Reserve Fund Investments, demand notes or
a combination thereof in the aggregate
amount, if any, specified in the related
Prospectus Supplement. Any Reserve Funds
for a Series may also be funded over time
through application of a specified amount
of cash flow, to the extent described in
the related Prospectus Supplement. Such a
Reserve Fund may be established to
increase the likelihood of the timely
distributions on the Certificates of such
Series. Reserve Funds may be established
to provide protection against certain
losses in addition to or in lieu of other
credit support, including, without
limitation, losses resulting from
delinquent payments on Loans, losses from
risks not covered by standard hazard
insurance policies, losses due to
bankruptcy of a borrower and application
of certain provisions of the Bankruptcy
Code, and losses due to denial of
insurance coverage due to
misrepresentations made in connection with
the origination of a Loan. Amounts on
deposit in the Reserve Funds for a Series,
together with (unless otherwise specified
in the related Prospectus Supplement) the
reinvestment income thereon, will be
applied for the purposes, in the manner
and to the extent provided by the related
Prospectus Supplement.

On each Distribution Date for a Series,
all amounts on deposit in any Reserve Fund
for the Series in excess of the amounts
required to be maintained therein by the
related Trust Agreement and specified in
the related Prospectus Supplement may be
released from the Reserve Funds and will
not be available for future distributions
on the Certificates of such Series.

Additional information concerning any
Reserve Funds, including whether the
Reserve Fund is a part of the Trust Fund,
the circumstances under which moneys
therein will be applied to make
distributions to Certificateholders, the
required balance to be maintained in such
Reserve Funds, the manner in which such
required balance will decrease over time
and the manner of funding the Reserve Fund
will be set forth in the related
Prospectus Supplement. See "CREDIT
SUPPORT--Reserve Funds."

f. FHA Insurance and
VA Guaranty . . . . . . . . . All or a portion of the Mortgage Loans in
a Mortgage Pool may be insured by FHA
insurance ("FHA Insurance") and may be
partially guaranteed by the VA (a "VA
Guaranty").

g. Other Arrangements . . . . . . Other arrangements as described in the
related Prospectus Supplement including,
but not limited to, one or more letters of
credit, surety bonds, other insurance or
third party guaranties, may be used to
provide coverage for certain risks of
default or various types of losses.

Servicing of Loans . . . . . . . . The Master Servicer or Servicer identified
in the related Prospectus Supplement will
service the Loans directly or administer
and supervise the performance by Servicers
or subservicers, as the case may be, of
their duties and responsibilities under
separate servicing agreements (the
"Servicing Agreements") or subservicing
agreements (the "Subservicing
Agreements"). Unless otherwise specified
in the related Prospectus Supplement, the
Master Servicer and each Servicer must be
approved by either FNMA or FHLMC as a
seller/servicer of Mortgage Loans and, in
the case of FHA Loans, approved by HUD as
an FHA mortgagee. Each Servicer will be
obligated under its Servicing Agreement to
perform customary servicing functions.
Advances with respect to delinquent
payments of principal or interest on a
Loan will be made by the Master Servicer
or any Servicer only to the extent
described in the related Prospectus
Supplement. Such advances will be intended
to provide liquidity only and, unless
otherwise specified in the related
Prospectus Supplement, will be
reimbursable to the Master Servicer or the
Servicer, as the case may be, from
scheduled payments of principal and
interest, late collections, or from the
proceeds of liquidation of the related
Loans, from other recoveries relating to
such Loans (including any insurance
proceeds or payments from other sources of
credit support). The Master Servicer or
the Servicers will be obligated to
repurchase Mortgage Loans for which
insurance coverage has been denied on the
grounds of fraud or misrepresentation only
to the extent specified in the related
Prospectus Supplement. If so specified in
the related Prospectus Supplement, the
Depositor may (i) obtain and assign to the
Trustee an agreement with an independent
standby servicer acceptable to each Rating
Agency rating such Certificates, which
will provide that such standby servicer
will assume a Servicer's or the Master
Servicer's obligations in the event of a
default by the Servicer or Master Servicer
or (ii) obtain a performance bond
acceptable to each Rating Agency rating
such Certificate that will guarantee
certain of the Servicer's or Master
Servicer's obligations. See "SERVICING OF
LOANS."

Federal Income Tax Considerations The federal income tax consequences to
Certificateholders will vary depending on
whether one or more elections are made to
treat the Trust Fund or specified portions
thereof as either a REMIC or a FASIT under
the provisions of the Internal Revenue
Code of 1986, as amended (the "Code"). The
Prospectus Supplement for each Series of
Certificates will specify whether such an
election will be made.

If a REMIC election or a FASIT election is
made, Certificates representing regular
interests in a REMIC or FASIT will
generally be treated as evidences of
indebtedness for federal tax purposes.
Stated interest on such regular interests
will be taxable as ordinary income and
taken into account using the accrual
method of accounting, regardless of the
holder's normal accounting method. If
neither a REMIC election nor a FASIT
election is made, interest (other than
original issue discount ("OID")) on
Certificates that are characterized as
indebtedness for federal income tax
purposes will be includible in income by
holders thereof in accordance with their
usual method of accounting.

Compound Interest Certificates will be,
and certain other Classes of Certificates
constituting Regular Interests may be,
issued with original issue discount that
is not de minimis. In such cases, the
Certificateholder will be required to
include the original issue discount in
gross income as it accrues, which may be
prior to the receipt of cash attributable
to such income. If a Regular Interest
Certificate is issued at a premium, the
holder thereof will be entitled to make an
election to amortize such premium on a
constant yield method. Certificates
constituting Regular Interests will
represent "qualifying real property loans"
for mutual savings banks and domestic
building and loan associations, "loans
secured by an interest in real property"
for domestic building and loan
associations and "real estate assets" for
real estate investment trusts to the
extent that the underlying loans qualify
for such treatment.

In the case of a REMIC election, a Class
of Certificates will be treated as REMIC
"Residual Interests." In the case of a
FASIT election, a class of Certificates
will be designated as the ownership
interest, as defined in the Code.
Certificates classified as REMIC Residual
Interests or the FASIT Ownership Interest
will generally be treated as representing
"qualifying real property loans" for
mutual savings banks and domestic building
and loan associations, "loans secured by
an interest in real property" for domestic
building and loan associations and "real
estate assets" for real estate investment
trusts to the same extent as REMIC or
FASIT Regular Interests.

The holder of a REMIC Residual Interest
Certificate must include in income its pro
rata share of the REMIC's taxable income.
Accordingly, in certain circumstances, the
holder of a REMIC Residual Interest might
(i) have REMIC taxable income or tax
liability attributable to REMIC taxable
income for a particular period or periods
in excess of cash distributions for such
period or periods or (ii) have an after-
tax return on its investment that is less
than the after-tax return on comparable
debt instruments or stripped bonds. In
addition, a portion (or, in some cases,
all) of the income from a REMIC Residual
Interest: (i) except, in certain
circumstances, with respect to a holder
classified as a thrift institution under
the Code, may not be subject to offset by
losses from other activities, (ii) for a
holder that is subject to tax under the
Code on unrelated business taxable income,
may be treated as unrelated business
taxable income and (iii) for a foreign
holder, may not qualify for exemption from
withholding under any treaty. Further,
individual holders are subject to
limitations on the deductibility of
expenses of the REMIC. In addition,
certain types of tax-exempt organizations,
including governmental entities, will not
be able to acquire ownership of a Residual
Interest Certificate.

The holder of a FASIT ownership interest
determines its taxable income by taking
into account all assets, liabilities, and
items of income, gain, deduction, loss,
and credit of a FASIT. In determining
that taxable income, the holder of a FASIT
ownership interest must determine the
amount of interest, original issue
discount, market discount, and premium
recognized with respect to the FASIT's
assets and the FASIT regular interests
issued by the FASIT according to a
constant yield methodology and under an
accrual method of accounting. In
addition, holders of FASIT ownership
securities are subject to limitations on
their ability to use losses to offset
income from their FASIT regular interests.

If no REMIC election is made, the Trust
Fund will be treated as a grantor trust
and will not be classified as an
association taxable as a corporation for
federal income tax purposes. The treatment
of a particular Series of Certificates
will depend on the characteristics of such
Series of Certificates. The holders of
Certificates will either be treated as
owners of undivided pro rata interests in
the underlying Loans ("Pass-Through
Certificates"), or as owners of stripped
bonds or stripped coupons ("Stripped
Certificates") under the Code. All income
with respect to a Stripped Certificate
will be accounted for as original issue
discount and, unless otherwise specified
in the related Prospectus Supplement, will
be reported by the Trustee on an accrual
basis, which may be prior to the receipt
of cash associated with such income.

The holder of a Pass-Through Certificate
must include in income its allocable share
of all interest and other income of the
Trust and may, subject to certain
limitations for individual
Certificateholders, deduct its allocable
share of all expenses of the Trust. Pass-
Through Certificates will be considered to
represent "qualifying real property loans"
for mutual savings banks and domestic
building and loan associations, "loans
secured by an interest in real property"
for domestic building and loan
associations and "real estate assets" for
real estate investment trusts to the
extent that the loans qualify for such
treatment. Although there is no direct
authority and the matter is not free from
doubt, Stripped Certificates should also
qualify for such treatment to the extent
that the underlying loans qualify for such
treatment. See "CERTAIN FEDERAL INCOME TAX
CONSIDERATIONS."

ERISA Considerations . . . . . . . A fiduciary of any employee benefit plan
subject to the Employee Retirement Income
Security Act of 1974, as amended
("ERISA"), or the Code should carefully
review with its own legal advisors whether
the acquisition, holding or disposition of
Certificates could give rise to a
transaction prohibited or otherwise
impermissible under ERISA or the Code. See
"ERISA CONSIDERATIONS."

Legal Investment . . . . . . . . . Unless otherwise specified in the related
Prospectus Supplement, Certificates of
each Series offered by this Prospectus and
the related Prospectus Supplement that are
rated in one of the two highest applicable
rating categories by at least one Rating
Agency will constitute "mortgage related
securities" under the Secondary Mortgage
Market Enhancement Act of 1984 ("SMMEA")
so long as they are so rated and, as such,
will be legal investments for certain
types of institutional investors to the
extent provided in SMMEA, subject, in any
case, to any other regulations which may
govern investments by such institutional
investors. Certain Certificates of some
Series offered by this Prospectus and the
related Prospectus Supplement may not be
rated in one of the two highest applicable
rating categories by at least one Rating
Agency and, accordingly, will not
constitute "mortgage related securities"
for purposes of SMMEA. Investors should
consult their own legal advisors to
determine the extent to which such
Certificates may be purchased by such
investors. See "LEGAL INVESTMENT
CONSIDERATIONS."

Use of Proceeds . . . . . . . . . The Depositor will use the net proceeds
from the sale of each Series for one or
more of the following purposes: (i) to
purchase the related Primary Assets, (ii)
to repay indebtedness which has been
incurred to obtain funds to acquire such
Primary Assets, (iii) to establish any
reserve funds described in the related
Prospectus Supplement and (iv) to pay
costs of structuring, guaranteeing and
issuing such Certificates. If so specified
in the related Prospectus Supplement, the
purchase of the Primary Assets for a
Series may be effected by an exchange of
Certificates with the Depositor of such
Primary Assets. See "USE OF PROCEEDS."

Ratings . . . . . . . . . . . . . It will be a requirement for issuance of
any Series that the Certificates offered
by this Prospectus and the related
Prospectus Supplement be rated by at least
one Rating Agency in one of its four
highest applicable rating categories. The
rating or ratings applicable to
Certificates of each Series offered hereby
and by the related Prospectus Supplement
will be as set forth in the related
Prospectus Supplement. A securities rating
should be evaluated independently of
similar ratings on different types of
securities. A securities rating does not
address the effect that the rate of
prepayments on Loans comprising or
underlying the Primary Assets may have on
the yield to investors in the
Certificates. See "RISK FACTORS."

RISK FACTORS

Investors should consider, among other things, the following factors in
connection with an investment in the Certificates.

Limited Liquidity. There can be no assurance that a secondary market
for the Certificates of any Series will develop or, if it does develop, that
it will provide Certificateholders with liquidity of investment or will
continue for the life of the Certificates. Lehman Brothers Inc. (through one
or more of its affiliates) intends to make a secondary market in the
Certificates, but has no obligation to do so. In addition, the market value
of Certificates of each Series will fluctuate with changes in prevailing
rates of interest, although in the case of Floating Rate Certificates, such
fluctuations may be less than those which may occur with respect to
Certificates that have a fixed rate of interest. Consequently, sale of the
Certificates by a Holder in any secondary market which may develop may be at
a discount from par value or from their purchase price. Certificateholders
have no optional redemption rights.

Yield, Prepayment and Maturity. The rate at which prepayments (which
include both voluntary prepayments by the Obligors on the Loans and
liquidations due to defaults and foreclosures) occur on the Loans underlying
or comprising the Primary Assets for a Series will be affected by a variety
of factors, including, without limitation, the level of prevailing interest
rates and economic, demographic, tax, social, legal and other factors.
Prepayments on the Loans comprising or underlying the Primary Assets for a
Series generally will result in a faster rate of distributions of principal
on the Certificates. Thus, the prepayment experience on the Loans comprising
or underlying the Primary Assets will affect the average life and yield to
investors of each Class and the extent to which principal on any such Class
is fully paid prior to its Final Scheduled Distribution Date, if at all. A
Series may include an Interest Weighted Class offered at a significant
premium or a Principal Weighted Class offered at a substantial discount.
Yields on such Classes of Certificates will be extremely sensitive to
prepayments on the Loans comprising or underlying the Primary Assets for such
Series. Where the amount of interest allocated with respect to an Interest
Weighted Class is extremely disproportionate to principal, a
Certificateholder purchasing such a Certificate at a significant premium
could, under some prepayment scenarios, fail to recoup its original
investment. If the Certificate Interest Rate on Certificates of a Series is
based upon a weighted average of the interest rates on the Loans comprising
or underlying the related Primary Assets, interest on such Certificates may
be paid or accrued in the future at a rate lower than the initial interest
rate to the extent that those of such Loans which bear higher rates of
interest are prepaid more quickly than those of such Loans which bear lower
rates of interest. Any rating assigned to the Certificates by a Rating Agency
will reflect only such Rating Agency's assessment of the likelihood that
timely distributions will be made with respect to such Certificates in
accordance with the related Trust Agreement. Such rating will not constitute
an assessment of the likelihood that principal prepayments on the Loans
underlying or comprising the Primary Assets will be made by borrowers or of
the degree to which the rate of such prepayments might differ from that
originally anticipated. As a result, such rating will not address the
possibility that prepayment rates higher or lower than anticipated by an
investor may cause such investor to experience a lower than anticipated
yield, or that an investor purchasing an Interest Weighted Certificate at a
significant premium might fail to recoup its initial investment. See "YIELD,
PREPAYMENT AND MATURITY CONSIDERATIONS".

Credit Support Limitations. The amount, type and nature of Insurance
Policies, subordination, certificate guarantee insurance, letters of credit
and other credit support, if any, required with respect to a Series will be
determined on the basis of criteria established by each Rating Agency rating
such Series. Such criteria are necessarily based upon an actuarial analysis
of the behavior of Loans in a larger group. Such actuarial analysis is the
basis upon which each Rating Agency determines (a) required amounts and types
of pool insurance, special hazard insurance, Reserve Funds, subordination or
other credit support and (b) limits on the number and amount of Loans which
have various special payment characteristics, have various Loan-to-Value
Ratios and/or were made for various purposes (e.g., primary residence, second
home, refinancing). There can be no assurance that the historical data
supporting such actuarial analysis will accurately reflect future experience
nor any assurance that the data derived from a large pool of housing loans
accurately predicts the delinquency, foreclosure or loss experience of any
particular pool of Loans.

In addition, if distributions in reduction of the principal balance of
Certificates of a Series of Multi-Class Certificates are made in order of the
respective Final Scheduled Distribution Dates of the Classes, any limits with
respect to the aggregate amount of claims under any related pool insurance,
special hazard insurance or other insurance policy, letters of credit or
other credit support may be exhausted before the principal of the later-
maturing Classes has been repaid. As a result, the impact of significant
losses on the Loans may bear primarily upon the Certificates of the later-
maturing Classes.

The Prospectus Supplement for a Series will describe any Reserve Funds,
Insurance Policies, letter of credit or other third-party credit support
relating to the Primary Assets or to the Certificates of such Series. Use of
such Reserve Funds and payments under such Insurance Policies, letter of
credit or other third-party credit support will be subject to the conditions
and limitations described herein and in the related Prospectus Supplement.
Moreover, such Reserve Funds, Insurance Policies, letter of credit or other
credit support will not cover all potential losses or risks. Moreover, if a
form of credit support covers more than one Trust Fund (each, a "Covered
Trust"), holders of Certificates issued by any of such Covered Trusts will be
subject to the risk that such credit support will be exhausted by the claims
of other Covered Trusts prior to such Covered Trust receiving any of its
intended share of such coverage. The obligations of the issuers of any credit
support such as a pool insurance policy, special hazard insurance policy,
bankruptcy bond, letter of credit, Certificate Guarantee Insurance,
repurchase bond or other third-party credit support will not be guaranteed or
insured by the United States, or by any agency or instrumentality thereof. A
Series of Certificates may include a Class or multiple Classes of Subordinate
Certificates to the extent described in the related Prospectus Supplement.
Although such subordination is intended to reduce the risk of delinquent
distributions or ultimate losses to Holders of Senior Certificates, the
Subordinated Amount will be limited and will decline under certain
circumstances and the related Subordination Reserve Fund, if any, could be
depleted in certain circumstances. See "DESCRIPTION OF THE CERTIFICATES",
"THE TRUST FUNDS" and "CREDIT SUPPORT".

Status of the Primary Assets in the Event of Insolvency. Each transfer
of the Primary Assets for a Series, including the transfer of such Primary
Assets to the Depositor, and from the Depositor to a trust, will be intended
to be an absolute and unconditional sale of such Primary Assets. However, in
the event of the bankruptcy of a prior owner of the Primary Assets, a trustee
in bankruptcy or a creditor of the insolvent party could attempt to
recharacterize the sale of the Primary Assets by such insolvent party as a
borrowing secured by a pledge of the Primary Assets. Such an attempt, even
if unsuccessful, could result in delays in payments on the Certificates of
such Series. If such an attempt were successful, holders of such
Certificates could suffer losses, and could fail to fully recover their
initial investments.

Certain Loans and Mortgaged Property. Loans such as GPM Loans, GEM
Loans, ARMs, Bi-Weekly Loans and Buy-Down Loans are of relatively recent
origin. As a result, reliable prepayment, loss and foreclosure statistics
relating to such Loans may not be available. Such Loans may be underwritten
on the basis of an assessment that the borrower will have the ability to make
payments in higher amounts in later years and, in the case of Loans with
adjustable mortgage rates, after relatively short periods of time. See "LOAN
UNDERWRITING PROCEDURES AND STANDARDS" and "CREDIT SUPPORT". Other Loans may
be underwritten principally on the basis of the initial Loan-to-Value Ratio
thereof. To the extent losses on Loans exceed levels estimated by the Rating
Agency rating the Series in determining required levels of
overcollateralization or other credit support, the Trust Fund may experience
a loss. Furthermore, Loans made with respect to Multifamily Property,
Manufactured Homes or Cooperative Dwellings may entail risks of loss in the
event of delinquency and foreclosure or repossession that are greater than
similar risks associated with traditional single-family property. To the
extent losses on such Loans exceed levels estimated by the Rating Agency in
determining required levels of overcollateralization or other credit support,
the Trust Fund may experience a loss. See "SERVICING OF LOANS--Maintenance of
Insurance Policies and Other Servicing Procedures" and "CREDIT SUPPORT".

Limited Obligations and Assets of Depositor. Unless otherwise set forth
in the Prospectus Supplement for a Series of Certificates, the Trust Fund for
a Series will be the only available source of funds to make distributions on
the Certificates of such Series. The only obligations, if any, of the
Depositor with respect to the Certificates of any Series will be pursuant to
certain representations and warranties. See "THE TRUST AGREEMENTS--Assignment
of Primary Assets" herein. The Depositor does not have, and is not expected
in the future to have, any significant assets with which to meet any
obligation to repurchase Primary Assets with respect to which there has been
a breach of any representation or warranty. If, for example, the Depositor
were required to repurchase a Loan which constitutes a Primary Asset, its
only sources of funds to make such repurchase would be from funds obtained
from the enforcement of a corresponding obligation, if any, on the part of
the originator or seller of the Loans, Servicer or Master Servicer, as the
case may be, or from a reserve fund established to provide funds for such
repurchases. See "THE DEPOSITOR".

FNMA and FHLMC Guaranties. Although payments on FNMA and FHLMC
Certificates are guaranteed by FNMA and FHLMC, respectively, in the manner
described herein (and although both FNMA and FHLMC are federally-chartered
corporations), such guaranties are backed by the credit of FNMA or FHLMC,
respectively, and not by the full faith and credit of the United States.
Neither the United States nor any agency thereof is obligated to finance the
operations of FNMA or FHLMC or to assist either of them in any other manner.
See "ADDITIONAL INFORMATION" for the availability of certain additional
information concerning FNMA and FNMA Certificates or FHLMC and FHLMC
Certificates.

ERISA Considerations. Generally, ERISA applies to investments made by
employee benefit plans and transactions involving the assets of such plans.
Due to the complexity of regulations which govern such plans, prospective
investors that are subject to ERISA are urged to consult their own counsel
regarding consequences under ERISA of acquisition, holding and disposition of
the Certificates of any Series. See "ERISA CONSIDERATIONS".

Certain Federal Tax Considerations Regarding REMIC Residual Interests.
Holders of REMIC Residual Interests will be required to report on their
federal income tax returns as ordinary income their pro rata share of the
taxable income of the REMIC regardless of the amount or timing of their
receipt of cash payments as described in "CERTAIN FEDERAL INCOME TAX
CONSEQUENCES--Residual Interests in a REMIC." Accordingly, under certain
circumstances, holders of Certificates which constitute REMIC Residual
Interests might have taxable income and tax liabilities arising from such
investment during a taxable year in excess of the cash received during such
period. The requirement that Holders of Residual Interest Certificates report
their pro rata share of the taxable income and net loss of the REMIC will
continue until the principal balances of all Classes of Certificates of the
related Series have been reduced to zero, even though holders of Residual
Interests have received full payment of their stated interest and principal.
A portion (or, in certain circumstances, all) of a Residual Interest
Certificateholder's share of the REMIC taxable income may be treated as
"excess inclusion" income to such holder which (i) except in the case of
certain thrift institutions, will not be subject to offset by losses from
other activities, (ii) for a tax-exempt Holder, will be treated as unrelated
business taxable income and (iii) for a foreign holder, will not qualify for
exemption from withholding tax. Individual Holders of Certificates
constituting Residual Interests may be limited in their ability to deduct
servicing fees and other expenses of the REMIC. Because of the special tax
treatment of REMIC residual interests, the taxable income arising in a given
year on a REMIC residual interest will not be equal to the taxable income
associated with investment in a corporate bond or stripped instrument having
similar cash flow characteristics and pre-tax yield. Therefore, the after-tax
yield on the Residual Interest Certificates may be significantly less than
that of a corporate bond or stripped instrument having similar cash flow
characteristics.

DESCRIPTION OF THE CERTIFICATES

General

The Certificates will be issued in Series pursuant to separate Trust
Agreements between the Depositor and the Trustee for the related Series
identified in the related Prospectus Supplement. The following summaries
describe certain provisions common to each Series. The summaries do not
purport to be complete and are subject to, and are qualified in their
entirety by reference to, the provisions of the Trust Agreement and the
Prospectus Supplement relating to each Series. When particular provisions or
terms used in the Trust Agreement are referred to, such provisions or terms
shall be as specified in the Trust Agreement.

Each Series will consist of one or more Classes, one or more of which
may consist of Compound Interest Certificates, Floating Rate Certificates,
Interest Weighted Certificates, Principal Weighted Certificates, Planned
Amortization Certificates ("PACs") or such other Certificates as are
described in the related Prospectus Supplement. A Series may also include one
or more Classes of Subordinate Certificates. A Class of Subordinate
Certificates will be offered hereby or by any Prospectus Supplement only if
rated by a Rating Agency in at least its fourth highest applicable rating
category. If so specified in the related Prospectus Supplement, the Primary
Assets in a Trust Fund may be divided into multiple Asset Groups.

Each Series will be issued in registered form, in the minimum original
principal amount or notional amount for Certificates of each Class specified
in the related Prospectus Supplement. The transfer of the Certificates may be
registered, and the Certificates may be exchanged, without the payment of any
service charge payable in connection with such registration of transfer or
exchange. If specified in the related Prospectus Supplement, one or more
Classes of a Series may be available in book-entry form only. See "--Book-
Entry Registration" herein.

Distributions on the Certificates

General. Commencing on the date specified in the related Prospectus
Supplement, distributions of principal and interest on the Certificates will
be made on each Distribution Date to the extent of the "Available
Distribution Amount" as set forth in the related Prospectus Supplement.

Distributions of interest on Certificates that receive interest will be
made periodically at the intervals and at the Certificate Interest Rate
specified or, with respect to Floating Rate Certificates, determined in the
manner described in the related Prospectus Supplement. Interest on the
Certificates will be calculated on the basis of a 360-day year consisting of
twelve 30-day months unless otherwise specified in the related Prospectus
Supplement. Distributions of principal on each class of the Certificates of a
Series will be made on a pro rata or random lot basis among all of the
Certificates of such Class, or otherwise, as specified in the related
Prospectus Supplement. Principal payments will be allocated to each Class of
a Series as specified in the related Prospectus Supplement.

If funds in the Certificate Account (together with any amounts
transferred from any Reserve Fund or applicable credit support) are
insufficient to make the full distribution to Certificateholders described
above on any Distribution Date, the funds available for distribution to the
Certificateholders of each Class will be distributed in accordance with their
respective interests therein, except that Subordinate Certificateholders, if
any, will not, subject to the limitations described in the related Prospectus
Supplement, receive any distributions until Senior Certificateholders receive
the amount of present distributions due them and the amount of distributions
owed them which were not timely distributed thereon and to which they are
entitled (in each case calculated as described in the related Prospectus
Supplement). The difference between the amount which the Certificateholders
would have received if there had been sufficient eligible funds available for
distribution and the amount actually distributed will be included in the
calculation of the amount which the Certificateholders are entitled to
receive on the next Distribution Date.

Distributions of principal of and interest on Certificates of a Series
will be made by check mailed to Certificateholders of such Series registered
as such on the close of business on the record date specified in the related
Prospectus Supplement at their addresses appearing on the Certificate
Register, except that (a) distributions may be made by wire transfer (at the
expense of the Certificateholder requesting payment by wire transfer) in
certain circumstances described in the related Prospectus Supplement and (b)
the final distribution in retirement of a Certificate will be made only upon
presentation and surrender of such Certificate at the corporate trust office
of the Trustee for such Series or such other office of the Trustee as
specified in the Prospectus Supplement. Notice of the final distribution on a
Certificate will be mailed to the Holder of such Certificate before the
Distribution Date on which such final distribution in retirement of the
Certificate is expected to be made. If specified in the related Prospectus
Supplement, the Certificates of a Series or certain Classes of a Series may
be available only in book-entry form. See "--Book-Entry Registration" herein.

With respect to reports to be furnished to Certificateholders concerning
a distribution, see "THE TRUST AGREEMENTS--Reports to Certificateholders".

Pass-Through Certificates Generally. With respect to a Series other
than a Multi-Class Series, distributions on the Certificates on each
Distribution Date will generally be allocated to each Certificate entitled
thereto on the basis of the undivided percentage interest (the "Percentage
Interest") evidenced by such Certificate in the Trust Fund or on the basis of
their outstanding principal amounts or notional amounts (subject to any
subordination of the rights of any Subordinate Classes to receive current
distributions). See "Subordinate Certificates" below as specified in the
related Prospectus Supplement.

If the Primary Assets for a Series have adjustable or variable interest
rates, then the Certificate Interest Rate of the Certificates of such Series
may also vary, due to changes in such rates and due to prepayments with
respect to Loans comprising or underlying the related Primary Assets. If the
Primary Assets for a Series have fixed interest rates, then the Certificate
Interest Rate on Certificates of the related Series may be fixed, or may
vary, to the extent prepayments cause changes in the weighted average
interest rate or pass-through rate of the Primary Assets. If the Primary
Assets have lifetime or periodic adjustment caps on the respective pass-
through rates, then the Certificate Interest Rate on the Certificates of the
related Series may also reflect such caps.

If so specified in the related Prospectus Supplement, a Series may
include one or more Classes of Interest Weighted Certificates, one or more
Classes of Principal Weighted Certificates, or both. Unless otherwise
specified in the Prospectus Supplement, payments received from the Primary
Assets will be allocated on the basis of the Percentage Interest of each
Class in the principal component of such distributions, the interest
component of such distributions, or both, and will be further allocated on a
pro rata basis among the Certificates within each Class. The method or
formula for determining the Percentage Interest of a Certificate will be set
forth in the related Prospectus Supplement.

Multi-Class Series. Unless otherwise specified in the Prospectus
Supplement, each Certificate of a Multi-Class Series will have a principal
amount or a notional amount and a specified Certificate Interest Rate (which
may be zero). Interest distributions on a Multi-Class Series will be made on
each Certificate entitled to an interest distribution on each Distribution
Date at the Certificate Interest Rate specified or, with respect to Floating
Rate Certificates, determined as described in the related Prospectus
Supplement, to the extent funds are available in the Certificate Account,
subject to any subordination of the rights of any Subordinate Class to
receive current distributions. See "Subordinate and Other Certificates" below
and "CREDIT SUPPORT".

Distributions of interest on a Class of Compound Interest Certificates
will commence only after the related Accretion Termination Date specified in
the related Prospectus Supplement. On each Distribution Date prior to and
including the Accretion Termination Date, interest on such Class of Compound
Interest Certificates will accrue and the amount of interest accrued on such
Distribution Date (the "Accrual Amount") will be added to the principal
balance thereof on the related Distribution Date. On each Distribution Date
after the Accretion Termination Date, interest distributions will be made on
Classes of Compound Interest Certificates on the basis of the current
Compound Value of such Class. The Compound Value of a Class of Compound
Interest Certificates equals the initial aggregate principal balance of the
Class, plus accrued and undistributed interest added to such Class through
the immediately preceding Distribution Date, less any principal distributions
previously made in reduction of the aggregate outstanding principal balance
of such Class.

To the extent provided in the related Prospectus Supplement, a Series of
Multi-Class Certificates may include one or more Classes of Floating Rate
Certificates. The Certificate Interest Rate of a Floating Rate Certificate
will be a variable or adjustable rate, which may be subject to a Maximum
Floating Rate, Minimum Floating Rate, or both. For each Class of Floating
Rate Certificates, the related Prospectus Supplement will set forth the
initial Floating Rate (or the method of determining it), the Floating Rate
Period, and the formula, index, or other method by which the Floating Rate
for each Floating Rate Period will be determined.

To the extent provided in the related Prospectus Supplement, a Series of
Multi-Class Certificates may include one or more Classes of Planned
Amortization Certificates ("PACs"), Targeted Amortization Certificates
("TACs") or other Certificates whose entitlement to distributions of
principal is based on a schedule of balances or amounts.

Distributions of principal will be allocated among the Classes of a
Multi-Class Series in the order of priority and amount specified in the
related Prospectus Supplement. The Principal Distribution Amount for a Multi-
Class Series on each Distribution Date will be as specified in the related
Prospectus Supplement.

Subordinate Certificates. One or more Classes of a Series may consist
of Subordinate Certificates. Subordinate Certificates may be included in a
Series to provide credit support as described herein under "CREDIT SUPPORT"
in lieu of or in addition to other forms of credit support. The extent of
subordination of a Class of Subordinate Certificates may be limited as
described in the related Prospectus Supplement. See "CREDIT SUPPORT". If the
Primary Assets are divided into separate Asset Groups, beneficial ownership
of which is evidenced by separate Classes of a Series, credit support may be
provided by a cross-support feature which requires that distributions be made
to Senior Certificates evidencing beneficial ownership of one Asset Group
prior to making distributions on Subordinate Certificates evidencing a
beneficial ownership interest in another Asset Group within the Trust Fund.
Unless rated in one of the four highest rating categories by at least one
Rating Agency, Subordinate Certificates will not be offered hereby or by the
related Prospectus Supplement.

Optional Termination

If so specified in the related Prospectus Supplement for a Series, the
Depositor, the Servicer or Master Servicer, or another entity designated in
the related Prospectus Supplement may, at its option, cause an early
termination of a Trust Fund by repurchasing all of the Primary Assets from
such Trust Fund on or after a date specified in the related Prospectus
Supplement, or on or after such time as the Aggregate Asset Principal Balance
of the Primary Assets is less than a specified percentage of the initial
Aggregate Asset Principal Balance, or the aggregate principal amount of the
Certificates (or of certain Classes thereof) is less than a specified
percentage of their initial aggregate principal amount. In the case of a
Trust Fund for which a REMIC or a FASIT election has been made, the Trustee
may require a satisfactory opinion of counsel that the repurchase will not
jeopardize the status of the REMIC or the status of the FASIT. Such optional
termination will be in addition to terminations which may result from other
events. See "THE TRUST AGREEMENTS--Deficiency Event" and "--Termination".

Optional Repurchase of Certificates

If so specified in the related Prospectus Supplement for a Series, one
or more Classes of the Certificates of such Series may be repurchased, in
whole or in part, at the option of the Depositor, at such times and under the
circumstances specified in such Prospectus Supplement. Notice of any such
repurchase must be given by the Trustee prior to the optional repurchase
date, as specified in the related Prospectus Supplement. The repurchase price
for any Certificate so repurchased will be set forth in the related
Prospectus Supplement.

Other Repurchases

If so specified in the related Prospectus Supplement for a Series, any
Class of the Certificates of such Series may be subject to redemption, in
whole or in part, at the request of the holders of such Class or to mandatory
repurchase by the Depositor. Any such redemption at the request of holders or
mandatory repurchase with respect to a Class of a Series of the Certificates
will be described in the related Prospectus Supplement and will be on such
terms and conditions as described therein.

The Depositor also may, at its option, obtain for any Series of the
Certificates, one or more guarantees from a company or companies acceptable
to the Rating Agencies. Such guarantees may provide for one or more of the
following for any Series of the Certificates: (i) call protection for any
Class of the Certificates of such Series; (ii) a guarantee of a certain
prepayment rate of some or all of the Loans underlying such Series; or (iii)
certain other guarantees, all as specified in the related Prospectus
Supplement.

Book-Entry Registration

If so specified in the related Prospectus Supplement, the Certificates
will be issued in book-entry form in the minimum denominations specified in
such Prospectus Supplement and integral multiples thereof, and each Class
will be represented by a single Certificate registered in the name of the
nominee of the depository, The Depository Trust Company ("DTC"), a limited-
purpose trust company organized under the laws of the State of New York. If
so specified in the related Prospectus Supplement, no person acquiring an
interest in the Certificates (a "Certificateowner") will be entitled to
receive a Certificate representing such person's interest in the Certificates
except in the event that Definitive Certificates (as defined herein) are
issued under the limited circumstances set forth under "Definitive
Certificates" below. Unless and until Definitive Certificates are issued, it
is anticipated that the only Certificateholder of the Certificates will be
Cede & Co., as nominee of DTC. Certificateowners will not be
"Certificateholders" or "Holders" under the Trust Agreement, and
Certificateowners will only be permitted to exercise the rights of
Certificateholders indirectly through DTC and its Participants.

DTC was created to hold securities for its participating organizations
("Participants") and facilitate the clearance and settlement of securities
transactions between Participants through electronic book-entry changes in
accounts of its Participants. Participants include securities brokers and
dealers, banks, trust companies and clearing corporations and may include
certain other organizations. Indirect access to the DTC system also is
available to entities that clear through or maintain a custodial relationship
with a Participant, either directly or indirectly ("Indirect Participants").

Certificateowners that are not Participants or Indirect Participants but
desire to purchase, sell or otherwise transfer ownership of Certificates may
do so only though Participants and Indirect Participants. Because DTC can
only act on behalf of Participants and Indirect Participants, the ability of
a Certificateowner to pledge such owner's Certificate to persons or entities
that do not participate in the DTC system, or otherwise take actions in
respect of such Certificate, may be limited. In addition, under a book-entry
format, Certificateowners may experience some delay in their receipt of
principal and interest distributions with respect to the Certificates since
such distributions will be forwarded to DTC and DTC will then forward such
distributions to its Participants which in turn will forward them to Indirect
Participants or Certificateowners.

Under the rules, regulations and procedures creating and affecting DTC
and its operations (the "Rules"), DTC is required to make book-entry
transfers among Participants on whose behalf it acts with respect to the
Certificates and is required to receive and transmit principal and interest
distributions and distributions with respect to the Certificates.
Participants and Indirect Participants with which Certificateowners have
accounts with respect to Certificates similarly are required to make book-
entry transfers and receive and transmit such distributions on behalf of
their respective Certificateowners. Accordingly, although Certificateowners
will not possess certificates, the Rules provide a mechanism by which
Certificateowners will receive distributions and will be able to transfer
their interests.

The Depositor understands that DTC will take any action permitted to be
taken by a Certificateholder under the Trust Agreement only at the direction
of one or more Participants to whose account with DTC the Certificates are
credited. Additionally, the Depositor understands that DTC will take such
actions with respect to holders of a certain specified interest in the
Certificates or holders having a certain specified voting interest only at
the direction of and on behalf of Participants whose holdings represent that
specified interest or voting interest. DTC may take conflicting actions with
respect to other Holders of Certificates to the extent that such actions are
taken on behalf of Participants whose holdings represent that specified
interest or voting interest.

Unless otherwise specified in the related Prospectus Supplement, if
Certificates of a Series are issued initially in book-entry form only, the
Certificates will be issued in fully registered, certified form ("Definitive
Certificates") to Certificateowners, rather than to DTC, only if (i) DTC or
the Depositor advises the Trustee in writing that DTC is no longer willing or
able properly to discharge its responsibilities as depository with respect to
the Certificates, and the Depositor is unable to locate a qualified
successor, (ii) the Depositor, at its sole option, elects to terminate the
book-entry system through DTC, or (iii) after the occurrence of an Event of
Default under the Trust Agreement, Certificateowners representing a majority
of the aggregate outstanding principal amount of the Certificates advise DTC
through Participants in writing that the continuation of a book-entry system
through DTC (or a successor thereto) is no longer in the best interests of
Certificateowners.

Upon the occurrence of any of the events described in clauses (i), (ii)
or (iii) of the immediately preceding paragraph, DTC is required to notify
all Participants of the availability through DTC of Definitive Certificates.
Upon surrender by DTC of the certificates representing the Certificates and
instructions for registration the Trustee will issue all, but not less than
all of the remaining formerly DTC-held Certificates then outstanding in the
form of Definitive Certificates, and thereafter the Trustee and the Master
Servicer will recognize the holders of such Definitive Certificates as
Certificateholders under the Trust Agreement.

YIELD, PREPAYMENT AND MATURITY CONSIDERATIONS

Payment Delays

With respect to any Series, a period of time will elapse between receipt
of payments or distributions on the Primary Assets and the Distribution Date
on which such payments or distributions are passed through to
Certificateholders. Such a delay will effectively reduce the yield that would
otherwise be obtained if payments or distributions were distributed on or
near the date of receipt. The related Prospectus Supplement will set forth an
example of the timing of receipts and the distribution thereof to
Certificateholders so that the impact of such a delay can be understood.

Principal Prepayments

With respect to a Series for which the Primary Assets consist of Loans
or participation interests therein, when a Loan prepays in full, the borrower
will generally be required to pay interest on the amount of prepayment only
to the prepayment date. In addition, the prepayment may not be required to be
passed through to Certificateholders until the month following receipt. The
effect of these provisions is to reduce the aggregate amount of interest
which would otherwise be available for distributions on the Certificates,
thus effectively reducing the yield that would be obtained if interest
continued to accrue on the Loan until the date on which the principal
prepayment was scheduled to be paid. To the extent specified in the related
Prospectus Supplement, this effect on yield may be mitigated by, among other
things, an adjustment to the servicing fee otherwise payable to the Master
Servicer or Servicer with respect to any such prepaid Loans. Further, if the
Certificate Interest Rate or Pass-Through Rate on Certificates of a Series is
based upon a weighted average of the interest rates on the Loans comprising
or underlying the related Primary Assets, interest on such Certificates may
be paid or accrued in the future at a rate lower than the initial interest
rate to the extent that those of such Loans which bear higher rates of
interest initial are prepaid more quickly than those of such Loans which bear
lower rates of interest. See "SERVICING OF LOANS--Advances and Limitations
Thereon".

Timing of Reduction of Principal Amount

A Multi-Class Series may provide that, for purposes of calculating
interest distributions, the principal amount of the Certificates is deemed
reduced as of a date prior to the Distribution Date on which principal
thereon is actually distributed. Consequently, the amount of interest accrued
during any Interest Accrual Period will be less than the amount that would
have accrued on the actual principal amount of the Certificates outstanding.
The effect of such provisions is to produce a lower yield on the Certificates
than would be obtained if interest were to accrue on the Certificates on the
actual unpaid principal amount of such Certificates to each Distribution
Date. The related Prospectus Supplement will specify the time at which the
principal amounts of the Certificates are determined or are deemed to reduce
for purposes of calculating interest distributions on Certificates of a
Multi-Class Series.

Interest or Principal Weighted Certificates

If a Class of Certificates consists of Interest Weighted Certificates or
Principal Weighted Certificates, a lower rate of principal prepayments than
anticipated will negatively affect yield to investors in Principal Weighted
Certificates, and a higher rate of principal prepayments than anticipated
will negatively affect yield to investors in Interest Weighted Certificates.
The Prospectus Supplement for a Series including such Certificates will
include a table showing the effect of various levels of prepayment on yields
on such Certificates. Such tables will be intended to illustrate the
sensitivity of yields to various prepayment rates and will not be intended to
predict, or provide information which will enable investors to predict,
yields or prepayment rates.

Final Scheduled Distribution Date

The Final Scheduled Distribution Date of each Class of any Multi-Class
Series will be specified in the related Prospectus Supplement and will be the
date (calculated on the basis of the assumptions applicable to such Series
described therein) on which the entire aggregate principal balance of such
Class will be reduced to zero. Since prepayments on the Loans underlying or
comprising the Primary Assets will be used to make distributions in reduction
of the outstanding principal amount of the Certificates, it is likely that
the actual maturity of any such Class will occur earlier, and may occur
substantially earlier, than its Final Scheduled Distribution Date.

Prepayments and Weighted Average Life

Weighted average life refers to the average amount of time that will
elapse from the date of issue of a security until each dollar of the
principal of such security will be repaid to the investor. The weighted
average life of the Certificates of a Series will be influenced by the rate
at which principal on the Loans comprising or underlying the Primary Assets
for such Certificates is paid, which may be in the form of scheduled
amortization or prepayments (for this purpose, the term "prepayment" includes
prepayments, in whole or in part, and liquidations due to default).

The rate of principal prepayments on pools of housing loans is
influenced by a variety of economic, demographic, geographic, legal, tax,
social and other factors. The rate of prepayments of conventional housing
loans has fluctuated significantly. In general, however, if prevailing
interest rates fall significantly below the interest rates on the Loans
comprising or underlying the Primary Assets for a Series, such Loans are
likely to prepay at rates higher than if prevailing interest rates remain at
or above the interest rates borne by such Loans. In this regard, it should be
noted that the Loans comprising or underlying the Primary Assets for a Series
may have different interest rates, and the stated pass-through or interest
rate of certain Primary Assets or the Certificate Interest Rate on the
Certificates may be a number of percentage points less than interest rates on
such Loans. In addition, the weighted average life of the Certificates may be
affected by the varying maturities of the Loans comprising or underlying the
Primary Assets. If any Loans comprising or underlying the Primary Assets for
a Series have actual terms-to-stated maturity less than those assumed in
calculating the Final Scheduled Distribution Date of the related
Certificates, one or more Classes of the Series may be fully paid prior to
their respective Stated Maturities.

Prepayments on loans are also commonly measured relative to a prepayment
standard or model, such as the Constant Prepayment Rate ("CPR") prepayment
model or the Standard Prepayment Assumption ("SPA") prepayment model, each as
described below.

CPR represents a constant assumed rate of prepayment each month relative
to the then outstanding principal balance of a pool of loans for the life of
such loans. SPA represents an assumed rate of prepayment each month relative
to the then outstanding principal balance of a pool of loans. A prepayment
assumption of 100% of SPA assumes prepayment rates of 0.2% per annum of the
then outstanding principal balance of such loans in the first month of the
life of the loans and an additional 0.2% per annum in each month thereafter
until the thirtieth month. Beginning in the thirtieth month and in each month
thereafter during the life of the loans, 100% of SPA assumes a constant
prepayment rate of 6% per annum each month.

Neither CPR nor SPA nor any other prepayment model or assumption
purports to be a historical description of prepayment experience or a
prediction of the anticipated rate of prepayment of any pool of loans,
including the Loans underlying or comprising the Primary Assets. Thus, it is
likely that prepayment of any Loans comprising or underlying the Primary
Assets for any Series will not conform to the FHA Prepayment Experience or to
any level of CPR or SPA.

The Prospectus Supplement for each Multi-Class Series will describe the
prepayment standard or model used to prepare any illustrative tables setting
forth the weighted average life of each Class of such Series under a given
set of prepayment assumptions. The related Prospectus Supplement will also
describe the percentage of the initial principal balance of each Class of
such Series that would be outstanding on specified Distribution Dates for
such Series based on the assumptions stated in such Prospectus Supplement,
including assumptions that prepayments on the Loans comprising or underlying
the related Primary Assets are made at rates corresponding to various
percentages of CPR or SPA or at such other rates specified in such Prospectus
Supplement. Such tables and assumptions are intended to illustrate the
sensitivity of weighted average life of the Certificates to various
prepayment rates and will not be intended to predict or to provide
information which will enable investors to predict the actual weighted
average life of the Certificates or prepayment rates of the Loans comprising
or underlying the related Primary Assets.

Other Factors Affecting Weighted Average Life

Type of Loan. Mortgage Loans made with respect to Multifamily
Properties may have provisions which prevent prepayment for a number of years
and may provide for payments of interest only during a certain period
followed by amortization of principal on the basis of a schedule extending
beyond the maturity of the related Mortgage Loan. ARMs, Bi-weekly Loans, GEM
Loans, GPM Loans or Buy-Down Loans comprising or underlying the Primary
Assets may experience a rate of principal prepayments which is different from
the principal prepayment rate for ARMs, Bi-weekly Loans, GEM Loans and GPM
Loans included in any other mortgage pool or from Conventional fixed rate
Loans or from other adjustable rate or graduated equity mortgages having
different characteristics. There can be no assurance as to the respective
rates of prepayment of such Loans in either stable or changing interest rate
environments.

In the case of Negatively Amortizing ARMs, if interest rates rise
without a simultaneous increase in the related Scheduled Payment, Deferred
Interest and negative amortization may result. However, borrowers may pay
amounts in addition to their Scheduled Payments in order to avoid such
negative amortization and to increase tax deductible interest payments. To
the extent that any of such Mortgage Loans negatively amortize over their
respective terms, future interest accruals are computed on the higher
outstanding principal balance of such Mortgage Loan and a smaller portion of
the Scheduled Payment is applied to principal than would be required to
amortize the unpaid principal over its remaining term. Accordingly, the
weighted average life of such Mortgage Loans will increase. During a period
of declining interest rates, the portion of each Scheduled Payment in excess
of the scheduled interest and principal due will be applied to reduce the
outstanding principal balance of the related Mortgage Loan, thereby resulting
in accelerated amortization of such ARM. Any such acceleration in
amortization of the principal balance of any Negatively Amortizing ARM will
shorten the weighted average life of such Mortgage Loan. The application of
partial prepayments to reduce the outstanding principal balance of a
Negatively Amortizing ARM will tend to reduce the weighted average life of
the Mortgage Loan and will adversely affect the yield to Holders who
purchased their Certificates at a premium, if any, and Holders of Interest
Weighted Classes. The pooling of Negatively Amortizing ARMs having Rate
Adjustment Dates in different months, together with different initial
Mortgage Rates, Lifetime Mortgage Rate Caps, Minimum Mortgage Rates and
stated maturity dates, could result in some Negatively Amortizing ARMs which
comprise or underlie the Primary Assets experiencing negative amortization
while the amortization of other Negatively Amortizing ARMs may be
accelerated.

If the Loans comprising or underlying the Primary Assets for a Series
include ARMs that permit the borrower to convert to a long-term fixed
interest rate loan, the Master Servicer, Servicer, or PMBS Servicer, as
applicable, may, if specified in the related Prospectus Supplement, be
obligated to repurchase any Loan so converted. Any such conversion and
repurchase would reduce the average weighted life of the Certificates of the
related Series.

A GEM Loan provides for scheduled annual increases in the borrower's
Scheduled Payment. Because the additional portion of the Scheduled Payment is
applied to reduce the unpaid principal balance of the GEM Loan, the stated
maturity of a GEM Loan will be significantly shorter than the 25 to 30 year
term used as the basis for calculating the installments of principal and
interest applicable until the first adjustment date.

The prepayment experience with respect to Manufactured Home Loans will
generally not correspond to the prepayment experience on other types of
housing loans. Even though some Manufactured Home Loans may be FHA Loans, no
statistics similar to those describing the FHA experience above are available
with respect to Manufactured Home Loans.

Foreclosures and Payment Plans. The number of foreclosures and the
principal amount of the Loans comprising or underlying the Primary Assets
which are foreclosed in relation to the number of Loans which are repaid in
accordance with their terms will affect the weighted average life of the
Loans comprising or underlying the Primary Assets and that of the related
Series of Certificates. Servicing decisions made with respect to the Loans,
including the use of payment plans prior to a demand for acceleration and the
restructuring of Loans in bankruptcy proceedings, may also have an impact
upon the payment patterns of particular Loans. In particular, the return to
Holders of Certificates who purchased their Certificates at a premium, if
any, and the return on an Interest Weighted Class may be adversely affected
by servicing policies and decisions relating to foreclosures.

Due on Sale Clauses. The acceleration of repayment as a result of
certain transfers of the Mortgaged Property securing a Loan is another factor
affecting prepayment rates, and is a factor that is not reflected in the FHA
experience. While each of the Mortgage Loans included in the FHA statistics
is assumable by a purchaser of the underlying mortgaged property, the Loans
constituting or underlying the Primary Assets may include "due-on-sale"
clauses. Except as otherwise described in the Prospectus Supplement for a
Series, the PMBS Servicer of Loans underlying Private Mortgage-Backed
Securities and the Master Servicer or the Servicer of Loans constituting the
Primary Assets for a Series will be required, to the extent it knows of any
conveyance or prospective conveyance of the related residence by any
borrower, to enforce any "due-on-sale" clause applicable to the related Loan
under the circumstances and in the manner it enforces such clauses with
respect to other similar loans in its portfolio. FHA Loans and VA Loans are
not permitted to contain "due-on-sale" clauses and are freely assumable by
qualified persons. However, as homeowners move or default on their housing
loans, the Mortgaged Property is generally sold and the loans prepaid, even
though, by their terms, the loans are not "due-on-sale" and could have been
assumed by new buyers.

Optional Termination. If so specified in the related Prospectus
Supplement, the entity specified therein may cause an early termination of
the related Trust Fund by its repurchase of the remaining Primary Assets
therein. See "DESCRIPTION OF THE CERTIFICATES--Optional Termination".

THE TRUST FUNDS

General

The Trust Fund for each Series will be held by the Trustee for the
benefit of the related Certificateholders. Each Trust Fund will consist of
(a) the Primary Assets; (b) amounts held from time to time in the Collection
Account and the Certificate Account established for such Series; (c)
Mortgaged Property which secured a Loan and which is acquired on behalf of
the Certificateholders by foreclosure, deed in lieu of foreclosure or
repossession; (d) any Reserve Fund for such Series, if specified in the
related Prospectus Supplement; (e) the Servicing Agreements, if any, relating
to Loans in the Trust Fund, to the extent that such agreements are assigned
to the Trustee; (f) any primary mortgage insurance policies relating to Loans
in the Trust Fund; (g) any pool insurance policy, any special hazard
insurance policy, any bankruptcy bond or other credit support relating to the
Series; (h) investments held in any fund or account or any Guaranteed
Investment Contract and, if so specified in the Prospectus Supplement, income
from the reinvestment of such funds; and (i) any other asset, instrument or
agreement relating to the Trust Fund and specified in the related Prospectus
Supplement (which may include an interest rate swap agreement or an interest
rate cap agreement or similar agreement issued by a bank, insurance company
or savings and loan association).

To the extent specified in the related Prospectus Supplement, certain
amounts in respect of Retained Interests which are received with respect to
an Agency Certificate, a Private Mortgage-Backed Security or a Loan
comprising the Primary Assets for a Series will not be included in the Trust
Fund for such Series, but will be payable to the seller of such Agency
Certificate, Private Mortgage-Backed Security or Loan, to the Master
Servicer, if any, to a Servicer, the Depositor or another party, free and
clear of the interest of Certificateholders under the related Trust
Agreement.

Primary Assets in the Trust Fund for a Series may consist of any
combination of the following to the extent and as specified in the related
Prospectus Supplement: (a) GNMA Certificates (which may be GNMA I
Certificates or GNMA II Certificates), (b) FNMA Certificates, (c) FHLMC
Certificates, (d) Private Mortgage-Backed Securities, (e) Mortgage Loans or
participation interests therein and (f) Manufactured Home Loans or
participation interests therein. Private Mortgage-Backed Securities will
evidence a beneficial ownership interest in underlying assets which will
consist of Agency Certificates or Loans. Participation interests in a Loan
Pool will be purchased by the Depositor, or an affiliate, pursuant to a
participation agreement (a "Participation Agreement"). The interest acquired
by the Depositor under such Participation Agreement will be evidenced by a
Pool Participation Certificate. Unless otherwise specified in the related
Prospectus Supplement, the terms of such Participation Agreement are
substantially the same as the terms of the Trust Agreement and, except as
noted herein, the description of provisions of the Trust Agreement are
equally descriptive of the terms of the Participation Agreement. The Trustee
will be the "certificateholder" with respect to a Pool Participation
Certificate. Loans which comprise the Primary Assets will be purchased by the
Depositor directly or through an affiliate in the open market or in privately
negotiated transactions. Some, none or all of the Loans may have been
originated by the Depositor or any of its affiliates. See "THE TRUST
AGREEMENTS--Assignment of Primary Assets."

GNMA Certificates

General. The GNMA Certificates will be "fully modified pass-through"
mortgage-backed certificates issued and serviced by GNMA-approved issuers of
GNMA certificates (the "GNMA Servicers") under the GNMA I and/or the GNMA II
program. The full and timely payment of principal of and interest on such
GNMA Certificates is guaranteed by GNMA, which obligation is backed by the
full faith and credit of the United States of America. The GNMA Certificates
will be based on and backed by a pool of eligible mortgage loans and will
provide for the payment by or on behalf of the GNMA Servicer to the
registered holder of such GNMA Certificate of monthly payments of principal
and interest equal to the aggregated amount of the monthly constant principal
and interest payments on each such mortgage loan, less servicing and
guarantee fees aggregating the excess of the interest on the mortgage loans
over the GNMA Certificate's pass-through rate. Each repayment to a holder of
a GNMA Certificate will include pass-through payments of any prepayments of
principal of the mortgage loans underlying the GNMA Certificate and the
remaining principal balance in the event of a foreclosure or other
disposition of any such mortgage loan.

The GNMA Certificates do not constitute a liability of, or evidence any
recourse against, the GNMA Servicer, the Depositor or any affiliate of the
Depositor, and the only recourse of a registered holder, such as the Trustee
or its nominee, is to enforce the guarantee of GNMA.

GNMA approves the issuance of each GNMA Certificate in accordance with a
guaranty agreement (the "Guaranty Agreement") between GNMA and the GNMA
Servicer of such GNMA Certificate. Pursuant to the Guaranty Agreement, the
GNMA Servicer is required to advance its own funds in order to make timely
payments of all amounts due on the GNMA Certificate, whether or not the
payments received by the GNMA Servicer on the underlying mortgage loans equal
the amounts due on such GNMA Certificate. If a GNMA Servicer is unable to
make a payment as it becomes due, it must promptly notify GNMA and request
GNMA to make the payment. Upon notification and request, GNMA will make such
payments directly to the registered holder of the GNMA Certificate. In the
event no payment is made by a GNMA Servicer and the GNMA Servicer fails to
notify and request GNMA to make such payment, the holder of the GNMA
Certificate has recourse only against GNMA to obtain such payment. The
Trustee or its nominee, as registered holder of the GNMA Certificates, may
proceed directly against GNMA under the terms of any GNMA Certificate or the
Guaranty Agreement relating to the GNMA Certificate for any amounts that are
not paid under the GNMA Certificate.

Monthly installment payments on a GNMA Certificate will be comprised of
interest due as specified on the GNMA Certificate plus the scheduled
principal payments on the mortgage loans backing such GNMA Certificate due on
the first day of the month in which the scheduled monthly installment on the
GNMA Certificate is due. The monthly installments on the GNMA Certificate
will be paid each month to the Trustee or its nominee as registered holder.
In addition, any principal prepayments or any other early recovery of
principal on the mortgage loans backing such GNMA Certificate received during
any month will be passed through to the registered holder of the GNMA
Certificate the following month.

With respect to GNMA Certificates issued under the GNMA I program, the
GNMA Servicer must make scheduled monthly payments of principal and interest,
plus pass-throughs of prepayments of principal and proceeds of foreclosures
and other dispositions of the mortgage loans, to registered holders no later
than the fifteenth day of each month. GNMA Certificates issued under the GNMA
II program provide for such payments to be mailed to registered holders by
Chemical Bank, as paying agent, no later than the twentieth day of each
month. A further difference between the two programs is that, under the GNMA
I program single issuer approach, an individual GNMA issuer assembles a pool
of mortgages against which it issues and markets GNMA I Certificates while,
under the GNMA II program, multiple issuer pools may be formed through the
aggregation of loan packages of more than one GNMA issuer. Under this option,
packages submitted by various GNMA issuers for a particular issue date and
interest rate are aggregated into a single pool which backs a single issue of
GNMA II Certificates. However, single issuer pools may be formed under the
GNMA II program as well.

The Underlying Mortgage Loans. Unless otherwise specified in the
related Prospectus Supplement, mortgage loans underlying the GNMA
Certificates included in the Trust Fund for a Series will consist of FHA
Loans and/or VA Loans, all of which are assumable by a purchaser. GNMA
Certificates securing a Series may be backed by level payment mortgage loans,
GNMA Loans, GEM Loans or Buy-Down Loans or adjustable rate mortgage loans or
other mortgage loans eligible for inclusion in a GNMA Certificate. The
mortgage loans may be secured by Manufactured Homes, Single Family Property
or Multifamily Property.

All mortgages underlying any GNMA Certificate issued under the GNMA I
program must have the same annual interest rate (except for pools of loans
secured by manufactured homes). The annual interest rate on each such GNMA
Certificate is equal to one-half percentage point less than the annual
interest rate on the mortgage loans backing such GNMA Certificate.

Mortgages underlying a GNMA Certificate issued under the GNMA II program
may have annual interest rates that vary from each other by up to one
percentage point. The annual interest rate on each such GNMA II Certificate
is between one-half percentage point and one and one-half percentage points
less than the highest annual interest rate on the mortgage loans included in
the pool of mortgages backing such GNMA Certificate.

The GNMA Certificates included in the Trust Fund for a Series may have
other characteristics and terms different from those described above, so long
as such GNMA Certificates and underlying mortgage loans meet the criteria of
each Rating Agency rating the Certificates of such Series. Such GNMA
Certificates and underlying mortgage loans will be described in the related
Prospectus Supplement.

GNMA. GNMA is a wholly owned corporate instrumentality of the United
States of America. Section 306(g) of Title III of the National Housing Act of
1934, as amended (the "Housing Act") authorizes GNMA to guarantee the timely
-----------
payment of the principal of and the interest on GNMA Certificates, which are
based on and backed by a pool of mortgages insured by the FHA under the
Housing Act or Title V of the Housing Act of 1949, or partially guaranteed by
the VA under the Servicemen's Readjustment Act of 1944, as amended, or
Chapter 37 of Title 38, United States Code, or by other eligible mortgage
loans.

Section 306(g) of the Housing Act provides that "the full faith and
credit of the United States is pledged to the payment of all amounts which
may be required to be paid under any guaranty under this subsection." To meet
its obligations under such guarantees, GNMA may, under Section 306(d) of the
Housing Act, borrow from the United States Treasury an amount which is at any
time sufficient to enable GNMA, with no limitations as to amount, to perform
its obligations under its guarantee.

FNMA Certificates

General. FNMA Certificates are either Guaranteed Mortgage Pass-Through
Certificates, Stripped Mortgage Backed Securities or Guaranteed REMIC Pass-
Through Certificates. FNMA Certificates represent factional undivided
interests in a pool of mortgage loans formed by FNMA. Unless otherwise
specified in the related Prospectus Supplement, each pool consists of
mortgage loans secured by a first lien on a one- to four-family residential
property. Mortgage loans comprising a pool are either provided by FNMA from
its own portfolio or purchased pursuant to the criteria set forth under the
FNMA purchase program.

FNMA guarantees to each holder of a FNMA certificate that it will
distribute amounts representing scheduled principal and interest (at the rate
provided for by such FNMA Certificate) on the mortgage loans in the pool
represented by such FNMA Certificate, whether or not received, and the
holder's proportionate share of the full principal amount of any foreclosed
or other finally liquidated mortgage loan, whether or not such principal
amount is actually recovered. The obligations of FNMA under its guarantees
are obligations solely of FNMA and are neither backed by nor entitled to the
full faith and credit of the United States of America. If FNMA were unable to
satisfy such obligations, distributions on FNMA Certificates would consist
solely of payments and other recoveries on the underlying mortgage loans and,
accordingly, delinquencies and defaults would affect monthly distributions on
such FNMA Certificates and could adversely affect the payments on the
Certificates of a Series secured by such FNMA Certificates.

Unless otherwise specified in the related Prospectus Supplement, FNMA
Certificates evidencing interests in pools formed on or after May 1, 1985
(other than FNMA Certificates backed by pools containing GPM Loans or
mortgage loans secured by multifamily projects) will be available in book-
entry form only. Distributions of principal of and interest on each FNMA
Certificate will be made by FNMA on the twenty-fifth day of each month to the
persons in whose name the FNMA Certificates are entered in the books of the
Federal Reserve Bank of New York (or registered on the FNMA Certificate
register in the case of fully registered FNMA Certificates) as of the close
of business on the last day of the preceding month. With respect to FNMA
Certificates issued in book-entry form, distributions will be made by wire;
with respect to FNMA Certificates issued in fully registered form,
distributions will be made by check.

The Underlying Mortgage Loans. Unless otherwise specified in the
related Prospectus Supplement, mortgage loans underlying FNMA Certificates in
the Trust Fund for a Series will consist of (i) fixed-rate level payment
mortgage loans that are Conventional Loans, (ii) fixed-rate level payment FHA
Loans or VA Loans, (iii) adjustable rate mortgage loans or GEM Loans, Buy-
Down Loans or GPM Loans, and (iv) mortgage loans secured by Single Family
Property or by Multifamily Property. Each mortgage loan must meet the
applicable standards set forth under the FNMA purchase program.

The original maturities of substantially all of the fixed rate level
payment Conventional Mortgage Loans are expected to be between either eight
to 15 years or 20 to 30 years. The original maturities of substantially all
of the fixed rate level payment FHA Loans or VA Loans are expected to be 30
years.

FNMA Stripped Mortgage Backed Securities are issued by FNMA in series of
two or more classes, with each class representing a specified undivided
fractional interest in principal distributions and/or interest distributions
(adjusted to the series pass-through rate) on the underlying pool of mortgage
loans. The fractional interests of each class in principal and interest
distributions are not identical, but the classes in the aggregate represent
100% of the principal distributions and interest distributions (adjusted to
the series pass-through rate) on the respective pool. Because of such
difference between the fractional interests in principal and interest of each
class, the effective rate of interest on the principal of each class of FNMA
Stripped Mortgage Backed Securities may be significantly higher or lower than
the series pass-through rate and/or the weighted average interest rate of the
underlying mortgage loans. The Guaranteed REMIC Pass-Through Certificates are
multiple-class pass-through certificates (representing beneficial interests
in a pool consisting primarily of FNMA or GNMA Certificates) as to which FNMA
has elected REMIC status for federal income tax purposes.

Mortgage loans underlying a FNMA Certificate may have annual interest
rates that vary by as much as two percentage points from each other. The rate
of interest payable on a FNMA Certificate (and the series pass-through rate
payable with respect to a FNMA Stripped Mortgage Backed Security) is equal to
the lowest interest rate of any mortgage loan in the related pool, less a
specified minimum annual percentage representing servicing compensation and
FNMA's guarantee fee. Under a regular servicing option (pursuant to which the
mortgagee or other servicer assumes the risk of foreclosure losses), the
annual interest rates on the mortgage loans underlying a FNMA Certificate
will be between .50 and 2.50 percentage points greater than the annual
interest rate for the FNMA Certificate (or the series pass-through rate
payable with respect to a FNMA Stripped Mortgage Backed Security), and, under
a special servicing option (pursuant to which the mortgagee or other servicer
is reimbursed by FNMA for foreclosure losses), the annual interest rates on
the mortgage loans underlying a FNMA Certificate will be between .55 and 2.55
percentage points greater than the annual FNMA Certificate interest rate (or
the series pass-through rate payable with respect to a FNMA Stripped Mortgage
Backed Security).

The Trust Fund for a Series may include FNMA Certificates having
characteristics and terms different from those described above, so long as
such FNMA Certificates and underlying mortgage loans meet the criteria of
each Rating Agency rating the Series. Such FNMA Certificates and underlying
mortgage loans will be described in the related Prospectus Supplement.

FNMA. FNMA is a federally chartered and stockholder-owned corporation
organized and existing under the Federal National Mortgage Association
Charter Act, as amended (12 U.S.C. Section1716 et seq.). FNMA was originally
established in 1938 as a United States government agency to provide
supplemental liquidity to the mortgage market and was transformed into a
stockholder-owned and privately managed corporation by legislation enacted in
1968.

FNMA provides funds to the mortgage market primarily by purchasing home
mortgage loans from lenders, thereby replenishing their funds for additional
lending. FNMA acquires funds to purchase loans from any capital market
investors that may not ordinarily invest in mortgage loans, thereby expanding
the total amount of funds available for housing. Operating nationwide, FNMA
helps to redistribute mortgage funds from capital-surplus to capital-short
areas. In addition, FNMA issues mortgage backed securities, primarily in
exchange for pools of mortgage loans from lenders. See "ADDITIONAL
INFORMATION" herein for the availability of further information with respect
to FNMA and FNMA Certificates.

FHLMC Certificates

General. The FHLMC Certificates represent an undivided interest in a
group of mortgages or participations therein (a "PC Pool") purchased by
FHLMC. FHLMC Certificates are sold under the terms of a Mortgage
Participation Certificate Agreement and may be issued under either FHLMC's
"Cash Program" or "Guarantor Program" or may be Multiclass Mortgage
Participation Certificates (Guaranteed) representing multiple classes of
certificates of beneficial interest in a pool consisting primarily of FHLMC
Certificates.

Under FHLMC's Cash Program, with respect to PC Pools formed prior to
June 1, 1987 there is no limitation on the amount by which interest rates on
the mortgage loans underlying a FHLMC Certificate may exceed the pass-through
rate on the FHLMC Certificate; with respect to FHLMC Certificates issued on
or after that date, the maximum interest rate on the mortgage loans
underlying such FHLMC Certificates cannot exceed the pass-through rate on
such FHLMC Certificates by more than two hundred basis points. Under such
program, FHLMC purchases groups of whole mortgage loans from a number of
sellers at specified percentages of their unpaid principal balances, adjusted
for accrued or prepaid interest, which, when applied to the interest rate of
the mortgage loans and participations purchased, results in the yield
(expressed as a percentage) required by FHLMC. The required yield, which
includes a minimum servicing fee retained by the servicer, is calculated
using the outstanding principal balance of the mortgage loans, an assumed
term and a prepayment period as determined by FHLMC. No loan or participation
is purchased by FHLMC at greater than 100% of the outstanding principal
balance. The range of interest rates on the mortgage loans and participations
in a PC Pool for a FHLMC Certificate issued under the Cash Program will vary
since mortgage loans and participations are purchased and assigned to a PC
Pool based upon their yield to FHLMC rather than on the interest rate on the
underlying mortgage loans. However, beginning with PC Pools formed on or
after June 1, 1987, the range of interest rates on the mortgages in Cash
Program PC Pools will not exceed 100 basis points.

Under FHLMC's Guarantor Program, the pass-through rate on a FHLMC
Certificate is established based upon the lowest rate on the underlying
mortgage loans, minus a minimum servicing fee and the amount of FHLMC's
management and guaranty income as agreed upon between the seller and FHLMC.
For FHLMC Certificate groups formed under the Guarantor Program, the range
between the lowest and highest annual interest rates on the mortgage loans in
a PC Pool may not exceed two hundred basis points, and beginning with PC
Pools formed in December 1987 under the Guarantor Program, the range of the
interest rates on the mortgage loans in a PC Pools will not exceed 100 basis
points.

The FHLMC Certificates will be guaranteed by FHLMC as to the timely
payment of interest at the applicable FHLMC Certificate rate on the holder's
pro rata share of the unpaid principal balance outstanding on the underlying
mortgage loans, whether or not received. FHLMC also guarantees payment of
principal on the underlying mortgage loans, without any offset or deduction,
to the extent of the registered holder's pro rata share thereof, but does
not, except with respect to "Scheduled Principal" FHLMC Certificates issued
under the Guarantor Program, guarantee the timely payment of scheduled
principal. Under FHLMC's Gold PC Program, FHLMC guarantees the timely payment
of principal based on the difference between the pool factor published in the
month preceding the month of distribution and the pool factor published in
such month of distribution. Pursuant to its guarantee, FHLMC indemnifies
holders of FHLMC Certificates against any diminution in principal by reason
of charges for property repairs, maintenance and foreclosure. FHLMC may remit
the amount due on account of its guarantee of collection of principal at any
time after default on an underlying mortgage loan, but not later than (i) 30
days following foreclosure sale, (ii) 30 days following payment of the claim
by any mortgage insurer or (iii) 30 days following the expiration of any
right of redemption, whichever occurs later, but in any event no later than
one year after demand has been made upon the mortgagor for accelerated
payment of principal. In taking actions regarding the collection of principal
after default on the mortgage loans underlying FHLMC Certificates, including
the timing of demand for acceleration, FHLMC reserves the right to exercise
its judgment with respect to the mortgage loans in the same manner as for
mortgages which FHLMC has purchased but not sold. The length of time
necessary for FHLMC to determine that a mortgage loan should be accelerated
varies with the particular circumstances of each mortgagor, and FHLMC has not
adopted servicing standards which require that the demand be made within any
specified period.

Holders of FHLMC Certificates are entitled to receive their pro rata
share of all principal payments on the underlying mortgage loans received by
FHLMC, including any scheduled principal payments, full and partial
prepayments of principal and principal received by FHLMC by virtue of
condemnation, insurance, liquidation or foreclosure, including repayments of
principal resulting from acquisition by FHLMC of the real property securing
the mortgage. FHLMC is required to remit to each holder its pro rata share of
principal payments on the underlying mortgage loans, interest at an
applicable FHLMC Certificate rate and any other sums, such as prepayment
fees, within 60 days of the date on which FHLMC is deemed to receive such
payments.

Under FHLMC's Cash Program, there is no limitation on the amount by
which interest rates on the mortgage loans underlying a FHLMC Certificate may
exceed the pass-through rate on the FHLMC Certificate. Under such program,
FHLMC purchases groups of whole mortgage loans from sellers at specified
percentages of their unpaid principal balances, adjusted for accrued or
prepaid interest, which when applied to the interest rate of the mortgage
loans and participations purchased results in the yield (expressed as a
percentage) required by FHLMC. The required yield, which includes a minimum
servicing fee retained by the servicer, is calculated using the outstanding
principal balance. The range of interest rates on the mortgage loans and
participations in a FHLMC Certificate group under the Cash Program will vary
since mortgage loans and participations are purchased and assigned to a FHLMC
Certificate group based upon their yield to FHLMC rather than on the interest
rate on the underlying mortgage loans. Under FHLMC's Guarantor Program, the
pass-through rate on a FHLMC Certificate is established based upon the lowest
interest rate on the underlying mortgage loans, minus a minimum servicing fee
and the amount of FHLMC's management and guarantee income as agreed upon
between the seller and FHLMC.

FHLMC Certificates are not guaranteed by, and do not constitute debts or
obligations of, either the United States of America or any Federal Home Loan
Bank. If FHLMC were unable to satisfy such obligations, distributions on
FHLMC Certificates would consist solely of payments and other recoveries on
the underlying mortgage loans, and, accordingly, delinquencies and defaults
would affect monthly distributions on such FHLMC Certificates and could
adversely affect distributions on the Certificates of such Series.

Requests for registration of ownership of FHLMC Certificates made on or
before the last business day of a month are made effective as of the first
day of that month. With respect to FHLMC Certificates sold by FHLMC on or
after January 2, 1985, the Federal Reserve Bank of New York maintains book-
entry accounts with respect thereto and makes payments of interest and
principal each month to holders in accordance with the holders' instructions.
The first payment to a holder of an FHLMC Certificate will normally be
received by the holder by the fifteenth day of the second month following the
month in which such person became a holder of the FHLMC Certificate.
Thereafter, payments will normally be received by the fifteenth day of each
month.

The Underlying Mortgage Loans. Unless otherwise specified in the
related Prospectus Supplement, each PC Pool underlying the FHLMC Certificates
in the Trust Fund for a Series will consist of first lien, fixed-rate, fully
amortizing, conventional residential mortgages or participation interests
therein. Unless otherwise specified in the related Prospectus Supplement, all
of the mortgage loans evidenced by a FHLMC Certificate are conventional
mortgages and therefore do not have the benefit of any guarantee or insurance
by, and are not obligations of, the United States of America. All mortgages
purchased by FHLMC must meet certain standards set forth in the FHLMC Act (as
defined below).

The Trust Fund for a Series may include FHLMC Certificates having other
characteristics and terms different from those described above, so long as
such FHLMC Certificates and the underlying mortgage loans meet the criteria
of each Rating Agency rating the Certificates of such Series. Such FHLMC
Certificates and underlying mortgage loans will be described in the related
Prospectus Supplement.

FHLMC. FHLMC is a corporate instrumentality of the United States of
America created pursuant to an Act of Congress (Title III of the Emergency
Home Finance Act of 1970, as amended, 12 U.S.C. 1451-1459) on July 24, 1970
(the "FHLMC Act"). FHLMC was established primarily for the purpose of
increasing the availability of mortgage credit for the financing of needed
housing. It provides an enhanced degree of liquidity for residential mortgage
investments primarily by assisting in the development of secondary markets
for conventional mortgages. The principal activity of FHLMC consists of the
purchase of first lien, conventional, residential mortgage loans and
participation interests in such mortgage loans from mortgage lending
institutions and the resale of the whole loans and participations so
purchased in the form of guaranteed mortgage securities, primarily FHLMC
Certificates. In 1981, FHLMC initiated its Guarantor Program under which
FHLMC purchases mortgages from sellers in exchange for FHLMC Certificates
representing interests in the mortgages so purchased. Transactions under the
Guarantor Program have resulted in a significant increase in the volume of
FHLMC's purchases of mortgages and sales of FHLMC Certificates. All mortgage
loans purchased by FHLMC must meet certain standards set forth in the FHLMC
Act. FHLMC is confined to purchasing, so far as practicable, mortgage loans
which it deems to be of such quality, type and class as to meet generally the
purchase standards imposed by private institutional mortgage investors. See
"ADDITIONAL INFORMATION" for the availability of further information with
respect to FHLMC and FHLMC Certificates.

Private Mortgage-Backed Securities

General. Private Mortgage-Backed Securities may consist of (a) mortgage
pass-through certificates, evidencing an undivided interest in a pool of
Loans or Agency Certificates, or (b) collateralized mortgage obligations
secured by Loans or Agency Certificates. Private Mortgage-Backed Securities
will have been issued pursuant to a pooling and servicing agreement, a trust
agreement, an indenture or similar agreement (a "PMBS Agreement"). The
seller/servicer of the underlying Loans, or the issuer of the collateralized
mortgage obligations, as the case may be, will have entered into the PMBS
Agreement with the trustee under such PMBS Agreement (the "PMBS Trustee").
The PMBS Trustee or its agent, or a custodian, will possess the Loans
underlying such Private Mortgage-Backed Security. Loans underlying a Private
Mortgage-Backed Security will be serviced by a servicer (the "PMBS Servicer")
directly or by one or more sub-servicers who may be subject to the
supervision of the PMBS Servicer. The PMBS Servicer will be an FNMA or FHLMC
approved servicer and, if FHA Loans underlie the Private Mortgage-Backed
Securities, approved by HUD as an FHA mortgagee.

The issuer of the Private Mortgage-Backed Securities (the "PMBS Issuer")
will be a financial institution or other entity engaged generally in the
business of mortgage lending; a public agency or instrumentality of a state,
local or federal government; or a limited purpose corporation organized for
the purpose of, among other things, establishing trusts and acquiring and
selling housing loans to such trusts, and selling beneficial interests in
such trusts; or one of such trusts. If so specified in the Prospectus
Supplement, the PMBS Issuer may be an affiliate of the Depositor. The
obligations of the PMBS Issuer will generally be limited to certain
representations and warranties with respect to the assets conveyed by it to
the related trust. Unless otherwise specified in the related Prospectus
Supplement, the PMBS Issuer will not have guaranteed any of the assets
conveyed to the related trust or any of the Private Mortgage-Backed
Securities issued under the PMBS Agreement. Additionally, although the Loans
underlying the Private Mortgage-Backed Securities may be guaranteed by an
agency or instrumentality of the United States, the Private Mortgage-Backed
Securities themselves will not be so guaranteed.

Distributions of principal and interest will be made on the Private
Mortgage-Backed Securities on the dates specified in the related Prospectus
Supplement. The Private Mortgage-Backed Securities may be entitled to receive
nominal or no principal distributions or nominal or no interest
distributions. Principal and interest distributions will be made on the
Private Mortgage-Backed Securities by the PMBS Trustee or the PMBS Servicer.
The PMBS Issuer or the PMBS Servicer may have the right to repurchase assets
underlying the Private Mortgage-Backed Securities after a certain date or
under other circumstances specified in the related Prospectus Supplement.

Underlying Loans. The Loans underlying the Private Mortgage-Backed
Securities may consist of fixed rate, level payment, fully amortizing Loans
or GEM Loans, GPM Loans, Buy-Down Loans, Bi-Weekly Loans, ARMs, or Loans
having balloon or other irregular payment features. Loans may be secured by
Single Family Property, Multifamily Property, Manufactured Homes, or, in the
case of Cooperative Loans, by an assignment of the proprietary lease or
occupancy agreement relating to a Cooperative Dwelling and the shares issued
by the related cooperative. Except as otherwise specified in the related
Prospectus Supplement, (i) no Loan shall have had a Loan-to-Value Ratio at
origination in excess of 95%, (ii) each Mortgage Loan secured by Single
Family Property and having a Loan-to-Value Ratio in excess of 80% at
origination will be covered by a primary mortgage insurance policy, (iii)
each Loan will have had an original term to stated maturity of not less than
10 years and not more than 40 years, (iv) no Loan that was more than 30 days
delinquent as to the payment of principal or interest will have been eligible
for inclusion in the assets under the related PMBS Agreement, (v) each Loan
(other than a Cooperative Loan) will be required to be covered by a standard
hazard insurance policy (which may be a blanket policy), and (vi) each Loan
(other than a Cooperative Loan or a Loan secured by a Manufactured Home) will
be covered by a title insurance policy.

Credit Support Relating to Private Mortgage-Backed Securities. Credit
support in the form of Reserve Funds, subordination of other private mortgage
certificates issued under the PMBS Agreement, letters of credit, Insurance
Policies or other types of credit support may be provided with respect to the
Loans underlying the Private Mortgage-Backed Securities or with respect to
the Private Mortgage-Backed Securities themselves. The type, characteristics
and amount of credit support will be a function of certain characteristics of
the Loans and other factors and will have been established for the Private
Mortgage-Backed Securities on the basis of requirements of the Rating Agency.

Additional Information. The Prospectus Supplement for a Series for
which the Trust Fund includes Private Mortgage-Backed Securities will
specify, to the extent relevant, (i) the aggregate approximate principal
amount and type of the Agency Certificates and Private Mortgage-Backed
Securities to be included in the Trust Fund; (ii) certain characteristics of
the Agency Certificates or Loans which comprise the underlying assets for the
Private Mortgage-Backed Securities including, in the case of Loans, (A) the
payment features of such Loans (i.e., whether they are fixed rate or
adjustable rate and whether they provide for fixed level payments or other
payment features), (B) the approximate aggregate principal balance, if known,
of underlying Loans insured or guaranteed by a governmental entity, (C) the
servicing fee or range of servicing fees with respect to the Loans, and (D)
the minimum and maximum stated maturities of the underlying Loans at
origination; (iii) the certificate rate or ranges thereof for the Private
Mortgage-Backed Securities; (iv) the weighted average certificate rate of the
Private Mortgage-Backed Securities; (v) the PMBS Issuer, the PMBS Servicer
(if other than the PMBS Issuer) and the PMBS Trustee for such Private
Mortgage-Backed Securities; (vi) certain characteristics of credit support,
if any, such as Reserve Funds, Insurance Policies, letters of credit or
guarantees relating to the Loans underlying the Private Mortgage-Backed
Securities or to such Private Mortgage-Backed Securities themselves; (vii)
the terms on which the underlying Loans for such Private Mortgage-Backed
Securities may, or are required to, be purchased prior to their stated
maturity or the stated maturity of the Private Mortgage-Backed Securities and
(viii) the terms on which Loans may be substituted for those originally
underlying the Private Mortgage-Backed Securities.

If information of the nature described above regarding the Private
Mortgage-Backed Securities or Agency Certificates is not known to the
Depositor at the time the Certificates are initially offered, approximate or
more general information of the nature described above will be provided in
the Prospectus Supplement and any additional information will be set forth in
a Current Report on Form 8-K to be available to investors on the date of
issuance of the related Series and to be filed with the Commission within 15
days after the initial issuance of such Certificates.

The Mortgage Loans

General. The Trust Fund for a Series may consist of Mortgage Loans or
participation interests therein. Mortgage Loans comprising the Primary Assets
and Mortgage Loans in which participation interests are conveyed to the
Trustee are both referred to herein as the "Mortgage Loans". Unless otherwise
specified in the Prospectus Supplement for the related Series, the Mortgage
Loans will have been originated by a savings and loan association, savings
bank, commercial bank, credit union, insurance company, or similar
institution which is supervised and examined by a Federal or State authority
or by a mortgagee approved by the Secretary of Housing and Urban Development
pursuant to sections 203 and 211 of the National Housing Act. Some, none or
all of the Mortgage Loans may have been originated by the Depositor or an
affiliate thereof. The Mortgage Loans may include Conventional Loans, FHA
Loans or VA Loans. The Mortgage Loans may have fixed interest rates or
adjustable interest rates and may provide for fixed level payments or may be
GPM Loans, GEM Loans, Buy-Down Loans, Bi-Weekly Loans or Mortgage Loans with
other payment characteristics as described below and under "YIELD, PREPAYMENT
AND MATURITY CONSIDERATIONS" herein and in the related Prospectus Supplement.
The Mortgage Loans may be secured by mortgages or deeds of trust or other
similar security instruments creating a first lien or if so specified in the
related Prospectus Supplement, a second lien, on Mortgaged Property. The
Mortgage Loans may also include Cooperative Loans evidenced by promissory
notes secured by a lien on the shares issued by private, non-profit,
cooperative housing corporations and on the related proprietary leases or
occupancy agreements granting exclusive rights to occupy specific Cooperative
Dwellings. The Mortgage Loans may also include Condominium Loans secured by a
Mortgage on a Condominium Unit together with such Condominium Unit's
appurtenant interest in the common elements.

If specified in the applicable Prospectus Supplement, the Mortgage Loans
may be secured by mortgages, deeds of trust or other similar Security
Instruments creating a lien on borrowers' leasehold interests in real
property under circumstances that the Depositor determines are commonly
acceptable to institutional mortgage investors. A Mortgage Loan secured by a
leasehold interest in real property is secured not by a fee simple interest
in the Mortgaged Property but rather by a leasehold interest under which the
mortgagor has the right, for a specified term, to use the related real estate
and the residential dwelling or dwellings located thereon. Generally, a
Mortgage Loan will be secured by a leasehold interest only if the use of
leasehold estates as security for mortgage loans is customary in the area,
the lease is not subject to any prior lien that could result in termination
of the lease and the term of the lease ends at least five years beyond the
maturity date of the related Mortgage Loan.

The Mortgaged Properties may include Single Family Property (i.e., one-
to four-family residential housing, including Condominium Units and
Cooperative Dwellings) or Multifamily Property (i.e., multifamily residential
rental properties or cooperatively-owned properties consisting of five or
more dwelling units). The Mortgaged Properties may consist of detached
individual dwellings, individual condominiums, townhouses, duplexes, row
houses, individual units in planned unit developments and other attached
dwelling units. Multifamily Property may include mixed commercial and
residential structures. Each Single Family Property and Multifamily Property
will be located on land owned in fee simple by the borrower or on land leased
by the borrower for a term at least five years greater than the term of the
related Mortgage Loan unless otherwise specified in the related Prospectus
Supplement. Attached dwellings may include owner-occupied structures where
each borrower owns the land upon which the unit is built, with the remaining
adjacent land owned in common or dwelling units subject to a proprietary
lease or occupancy agreement in a cooperatively owned apartment building. The
proprietary lease or occupancy agreement securing a Cooperative Loan is
generally subordinate to any blanket mortgage on the related cooperative
apartment building and/or on the underlying land. Additionally, in the case
of a Cooperative Loan, the proprietary lease or occupancy agreement is
subject to termination and the cooperative shares are subject to cancellation
by the cooperative if the tenant-stockholder fails to pay maintenance or
other obligations or charges owed to the Cooperative by such tenant-
stockholder. See "CERTAIN LEGAL ASPECTS OF LOANS".

The aggregate principal balance of Mortgage Loans with respect to
Mortgaged Properties which are owner-occupied will be disclosed in the
related Prospectus Supplement. Unless otherwise specified in the Prospectus
Supplement, the sole basis for a representation that a given percentage of
the Mortgage Loans are secured by Single-Family Property that is owner-
occupied will be either (i) the making of a representation by the mortgagor
at origination of the Mortgage Loan either that the underlying Mortgaged
Property will be used by the borrower for a period of at least six months
every year or that the borrower intends to use the Mortgaged Property as a
primary residence, or (ii) a finding that the address of the underlying
Mortgaged Property is the borrower's mailing address as reflected in the
Servicer's records. To the extent specified in the related Prospectus
Supplement, the Mortgaged Properties may include non-owner occupied
investment properties and vacation and second homes. Mortgage Loans secured
by investment properties and Multifamily Property may also be secured by an
assignment of leases and rents and operating or other cash flow guarantees
relating to the Loans to the extent specified in the related Prospectus
Supplement.

The characteristics of the Mortgage Loans comprising or underlying the
Primary Assets for a Series may vary to the extent that credit support is
provided in levels satisfactory to each Rating Agency that assigns a rating
to a Series of Certificates. Unless otherwise specified in the related
Prospectus Supplement for a Series, the following selection criteria shall
apply with respect to the Mortgage Loans comprising the Primary Assets:

(a) no first lien Mortgage Loan shall have had a Loan-to-Value
Ratio at origination in excess of 95%, and no second lien Mortgage Loan
shall have had a Loan-to-Value Ratio at origination in excess of 125%;

(b) no first lien Mortgage Loan that is a Conventional Loan
secured by a Single Family Property may have a Loan-to-Value Ratio in
excess of 80%, unless covered by a primary mortgage insurance policy as
described herein;

(c) each first lien Mortgage Loan must have an original term to
maturity of not less than 10 years and not more than 40 years and each
second lien Mortgage Loan must have an original term to maturity of not
less than 5 years and not more than 30 years;

(d) no Mortgage Loan may be included which, as of the Cut-off
Date, is more than 59 days delinquent as to payment of principal or
interest;

(e) no Mortgage Loan (other than a Cooperative Loan) may be
included unless a title insurance policy or, in lieu thereof, an
attorney's opinion of title, and a standard hazard insurance policy
(which may be a blanket policy) is in effect with respect to the
Mortgaged Property securing such Mortgage Loan.

The initial Loan-to-Value Ratio of any Mortgage Loan represents the
ratio of the principal amount of the Mortgage Loan outstanding at the
origination of such loan divided by the fair market value of the Mortgaged
Property, as shown in the appraisal prepared in connection with origination
of the Mortgage Loan (the "Appraised Value"). In the case of a Mortgage Loan
to finance the purchase of a Mortgaged Property, the fair market value of
such Mortgaged Property is the lesser of the purchase price paid by the
borrower or the Appraised Value of such Mortgaged Property.

Unless otherwise specified in the related Prospectus Supplement, with
respect to Buy-Down Loans, during the period (the "Buy-Down Period") when the
borrower is not obligated, on account of the buy-down plan, to pay the full
Scheduled Payment otherwise due on such loan, each of the Buy-Down Loans will
provide for Scheduled Payments based on a hypothetical reduced interest rate
(the "Buy-Down Mortgage Rate") that will not have been more than 3% below the
mortgage rate at origination and for annual increases in the Buy-Down
Mortgage Rate during the Buy-Down Period that will not exceed 1%,and the Buy-
Down Period will not exceed three years. The maximum amount of funds that may
be contributed with respect to a Mortgaged Property having a Loan-to-Value
Ratio (i) of 90% or less at origination is limited to 10% of the Appraised
Value of the Mortgaged Property, and (ii) in excess of 90% at origination is
limited to 6% of the Appraised Value of the Mortgaged Property, unless
otherwise indicated in the applicable Prospectus Supplement. Unless specified
otherwise in the related Prospectus Supplement, the maximum amount of funds
(the "Buy-Down Amounts") that may be contributed by the Servicer of the
related Mortgaged Loan is limited to 6% of the Appraised Value of the
Mortgaged Property. This limitation does not apply to contributions from
immediate relatives or the employer of the mortgagor. Except as may be
otherwise indicated in the related Prospectus Supplement, the borrower under
each Buy-Down Loan will have been qualified at a mortgage rate which is not
more than 3% per annum below the current mortgage rate at origination.
Accordingly, the repayment of a Buy-Down Loan is dependent on the ability of
the borrower to make larger Scheduled Payments after the Buy-Down Amounts
have been depleted and, for certain Buy-Down Loans, while such Buy-Down
Amounts are being depleted.

Unless otherwise specified in the related Prospectus Supplement, with
respect to Multifamily Property, (a) no Mortgage Loan will have been
delinquent for more than 59 days within the 12-month period ending with the
Cut-off Date, (b) no more than two payments will have been 59 days or more
delinquent during a three-year period ending on the Cut-off Date, (c)
Mortgage Loans with respect to any single borrower will not exceed 5% of the
aggregate principal balance of the Loans comprising the Primary Assets as of
the Cut-off Date, and (d) the debt service coverage ratio with respect to
each Mortgage Loan (calculated as described in the related Prospectus
Supplement) will not be less than 1.1:1.

Unless otherwise specified in the related Prospectus Supplement, the Bi-
Weekly Loans will consist of fixed-rate, bi-weekly payment, conventional,
fully-amortizing Mortgage Loans secured by first mortgages on one-to-four
family residential properties.

Unless otherwise specified in the related Prospectus Supplement, the
ARMs will provide for a fixed initial Mortgage Rate for one or more Scheduled
Payments; thereafter, the Mortgage Rates will adjust periodically based,
subject to the applicable limitations, on changes in the relevant Index
described in the applicable Prospectus Supplement, to a rate equal to the
Index plus the Gross Margin, which is a fixed percentage spread over the
Index established contractually for each ARM at the time of its origination.
An ARM may be convertible into a fixed-rate Mortgage Loan. To the extent
specified in the related Prospectus Supplement, any ARM so converted may be
subject to repurchase by the Servicer.

Adjustable mortgage rates can cause payment increases that some
borrowers may find difficult to make. However, each of the ARMs may provide
that its mortgage rate may not be adjusted to a rate above the applicable
lifetime mortgage rate cap (the "Lifetime Mortgage Rate Cap"), if any, or
below the applicable lifetime minimum mortgage rate (the "Minimum Mortgage
Rate"), if any, for such ARM. In addition, certain of the ARMs provide for
limitations on the maximum amount by which their mortgage rates may adjust
for any single adjustment period (the "Maximum Mortgage Rate Adjustment").
Some ARMs are payable in self-amortizing payments of principal and interest.
Other ARMs ("Negatively Amortizing ARMs") instead provide for limitations on
changes in the Scheduled Payment on such ARMs to protect borrowers from
payment increases due to rising interest rates. Such limitations can result
in Scheduled Payments which are greater or less than the amount necessary to
amortize a Negatively Amortizing ARM by its original maturity at the mortgage
rate in effect during any particular adjustment period. In the event that the
Scheduled Payment is not sufficient to pay the interest accruing on a
Negatively-Amortizing ARM, then the Deferred Interest is added to the
principal balance of such ARM causing the negative amortization thereof, and
will be repaid through future Scheduled Payments. If specified in the related
Prospectus Supplement, Negatively-Amortizing ARMs may provide for the
extension of their original stated maturity to accommodate changes in their
mortgage rate. The relevant Prospectus Supplement will specify whether the
ARMs comprising or underlying the Primary Assets are Negatively Amortizing
ARMs.

The index applicable to any ARMs comprising the Primary Assets (the
"Index") will be the one-month LIBOR Index, the three-year Treasury Index,
the one-year Treasury Index, the Six Month Treasury Index, the Eleventh
District Costs of Funds Index or the National Monthly Median Cost of Funds
Ratio to FSLIC-Insured Institutions or such other index or indices as are
specified or described in the related Prospectus Supplement.

The related Prospectus Supplement for each Series will provide
information with respect to the Mortgage Loans as of the Cut-off Date,
including, among other things, (a) the aggregate outstanding principal
balance of the Mortgage Loans; (b) the weighted average Mortgage Rate on the
Mortgage Loans, and, in the case of ARMs, the weighted average of the current
mortgage rates and the Lifetime Mortgage Rate Caps, if any; (c) the average
outstanding principal balance of the Mortgage Loans; (d) the weighted average
term-to-stated maturity of the Mortgage Loans and the range of remaining
terms-to-stated maturity; (e) the range of Loan-to-Value Ratios for the
Mortgage Loans; (f) the relative percentage (by outstanding principal balance
as of the Cut-off Date) of Mortgage Loans that are ARMs, Cooperative Loans,
Conventional Loans, Bi-Weekly Loans, FHA Loans and VA Loans; (g) the
percentage of Mortgage Loans (by outstanding principal balance as of the Cut-
off Date) that are not covered by primary mortgage insurance policies; (h)
any pool insurance policy, special hazard insurance policy or bankruptcy bond
or other credit support relating to the Mortgage Loans; (i) the geographic
distribution of the Mortgaged Properties securing the Mortgage Loans and (j)
the percentage of Mortgage Loans (by principal balance as of the Cut-off
Date) that are secured by Single Family Property, Multifamily Property,
Cooperative Dwellings, investment property and vacation or second homes. The
related Prospectus Supplement will also specify any other limitations on the
types or characteristics of Mortgage Loans which may comprise or underlie the
Primary Assets for a Series.

If information of the nature described above respecting the Mortgage
Loans is not known to the Depositor at the time the Certificates are
initially offered, approximate or more general information of the nature
described above will be provided in the Prospectus Supplement and any
additional information will be set forth in a Current Report on Form 8-K to
be available to investors on the date of issuance of the related Series and
to be filed with the Commission within 15 days after the initial issuance of
such Certificates.

The Manufactured Home Loans

The Manufactured Home Loans comprising or underlying the Primary Assets
for a Series of Certificates will consist of manufactured housing conditional
sales contracts and installment loan agreements originated by a manufactured
housing dealer in the ordinary course of business and purchased by the
Depositor. Each Manufactured Home Loan will have been originated by a bank or
savings institution which is a FNMA- or FHLMC-approved seller/servicer or by
any financial institution approved for insurance by the Secretary of Housing
and Urban Development pursuant to Section 2 of the National Housing Act.

The Manufactured Home Loans may be Conventional Loans, FHA Loans or VA
Loans. Each Manufactured Home Loan will be secured by a Manufactured Home.
Unless otherwise specified in the related Prospectus Supplement, the
Manufactured Home Loans will be fully amortizing and will bear interest at a
fixed interest rate.

The Manufactured Homes securing the Manufactured Home Loans consist of
manufactured homes within the meaning of 42 United States Code, Section
5402(6), which defines a "manufactured home" as "a structure, transportable
in one or more sections, which in the traveling mode, is eight body feet or
more in width or forty body feet or more in length, or, when erected on site,
is three hundred twenty or more square feet, and which is built on a
permanent chassis and designed to be used as a dwelling with or without a
permanent foundation when connected to the required utilities, and includes
the plumbing, heating, air-conditioning, and electrical systems contained
therein; except that such term shall include any structure which meets all
the requirements of (this) paragraph except the size requirements and with
respect to which the manufacturer voluntarily files a certification required
by the Secretary of Housing and Urban Development and complies with the
standards established under (this) chapter."

Unless otherwise specified in the related Prospectus Supplement for a
Series, the following restrictions apply with respect to Manufactured Home
Loans comprising or underlying the Primary Assets for a Series:

(a) no Manufactured Home Loan shall have had a Loan-to-Value Ratio
at origination in excess of 95%;

(b) each Manufactured Home Loan must have an original term to
maturity of not less than three years and not more than 30 years;

(c) no Manufactured Home Loan may be as of the Cut-off Date more
than 59 days delinquent as to payment of principal or interest; and

(d) each Manufactured Home Loan must have, as of the Cut-off Date,
a standard hazard insurance policy (which may be a blanket policy) in
effect with respect thereto.

The initial Loan-to-Value Ratio of any Manufactured Home Loan represents
the ratio of the principal amount of the Manufactured Home Loan outstanding
at the origination of such loan divided by the fair market value of the
Manufactured Home, as shown in the appraisal prepared in connection with
origination of the Manufactured Home Loan (the "Appraised Value"). The fair
market value of the Manufactured Home securing any Manufactured Home Loan is
the lesser of the purchase price paid by the borrower or the Appraised Value
of such Manufactured Home. With respect to underwriting of Manufactured Home
Loans, see "LOAN UNDERWRITING PROCEDURES AND STANDARDS". With respect to
servicing of Manufactured Home Loans, see "SERVICING OF LOANS".

The related Prospectus Supplement for each Series will provide
information with respect to the Manufactured Home Loans comprising the
Primary Assets as of the Cut-off Date, including, among other things, (a) the
aggregate outstanding principal balance of the Manufactured Home Loans
comprising or underlying the Primary Assets; (b) the weighted average
interest rate on the Manufactured Home Loans; (c) the average outstanding
principal balance of the Manufactured Home Loans; (d) the weighted average
scheduled term to maturity of the Manufactured Home Loans and the range of
remaining scheduled terms to maturity; (e) the range of Loan-to-Value Ratios
of the Manufactured Home Loans; (f) the relative percentages (by principal
balance as of the Cut-off Date) of Manufactured Home Loans that were made on
new Manufactured Homes and on used Manufactured Homes; (g) any pool insurance
policy, special hazard insurance policy or bankruptcy bond or other credit
support relating to the Manufactured Home Loans; and (h) the distribution by
state of Manufactured Homes securing the Loans. The related Prospectus
Supplement will also specify any other limitations on the types or
characteristics of Manufactured Home Loans which may be included in the
Primary Assets for a Series.

If information of the nature specified above respecting the Manufactured
Home Loans is not known to the Depositor at the time the Certificates are
initially offered, approximate or more general information of the nature
described above will be provided in the Prospectus Supplement and any
additional information will be set forth in a Current Report on Form 8-K to
be available to investors on the date of issuance of the related Series and
to be filed with the Commission within 15 days after the initial issuance of
such Certificates.

Pre-Funding Arrangements

To the extent provided in the related Prospectus Supplement for a
Series, the related Trust Agreement will provide for a commitment by the
Depositor to subsequently convey to the applicable Trust Fund additional
Primary Assets ("Subsequent Primary Assets") following the date on which the
related Certificates are issued (a "Pre-Funding Arrangement"). With respect
to a Series, the Pre-Funding Arrangement will require that any Subsequent
Primary Assets included in the Trust Fund conform to the requirements and
conditions provided in the related Trust Agreement. If a Pre-Funding
Arrangement is utilized in connection with the issuance of the Series of
Certificates, on the closing date for the issuance of such Series the related
Trustee will be required to deposit in a segregated account (a "Pre-Funding
Account") all or a portion of the proceeds received by such Trustee in
connection with the sale of one or more Classes of Certificates of such
Series; and, subsequently, the Trust Fund will acquire Subsequent Primary
Assets in exchange for the release of money from the Pre-Funding Account for
such Series. In addition, the Pre-Funding Arrangement will be limited to a
specified period, not to exceed three months, during which time any transfers
of Subsequent Primary Assets must occur and to a maximum deposit to the
related Pre-Funding Account of no more than thirty-five percent (35%) of the
aggregate proceeds received from the sale of all Classes of Certificates of
such Series.

If all of the funds originally deposited in the such Pre-Funding Account
are not used by the end of such specified period, then any remaining amount
of such funds will be applied as a mandatory prepayment of a Class or Classes
of Certificates as specified in the related Prospectus Supplement. Although
it is intended that the principal amount of Subsequent Primary Assets to be
included in the Trust Fund after the closing date for the issuance of any
particular Series will require application of substantially all of the Pre-
Funding Account, and it is not anticipated that there will be any material
amount of principal distributions from amounts remaining on deposit in the
Pre-Funding Account in reduction of the principal balances of any
Certificates, no assurance can be given that such a distribution with respect
to the Certificates will not occur on the Distribution Date following the end
of the Pre-Funding Arrangement.

Amounts on deposit in the Pre-Funding Account will be invested as
provided in the related Trust Agreement in investments permitted by each
applicable Rating Agency.

Collection Account and Certificate Account

A separate Collection Account for each Series will be established by the
Trustee, or by the Master Servicer in the name of the Trustee, for deposit of
all distributions received with respect to the Primary Assets for such
Series, the amount of cash to be initially deposited therein, if any, and
reinvestment income thereon. If specified in the related Prospectus
Supplement, any reinvestment income or other gain from investments of funds
in the Collection Account will be credited to such Collection Account, and
any loss resulting from such investments will be charged to such Collection
Account. Such reinvestment income may, however, be payable to the Trustee,
the Master Servicer or a Servicer as additional compensation. See "SERVICING
OF LOANS" and "THE TRUST AGREEMENTS--Investment of Funds." In such a case,
such reinvestment income would not be included in calculation of the
Available Distribution Amount. See "DESCRIPTION OF THE CERTIFICATES C
Distributions on the Certificates."

Funds on deposit in the Collection Account will be available for
remittance to the Trustee for deposit into the Certificate Account to the
extent of the Available Distribution Amount and for certain other payments
provided for in the Trust Agreement. Unless otherwise specified in the
Prospectus Supplement, amounts in the Collection Account constituting
reinvestment income which is payable to the Master Servicer as additional
servicing compensation or for the reimbursement of advances or expenses,
amounts in respect of any Excess Servicing Fee, Retained Interest, and
amounts to be deposited into any reserve fund will not be included in
determining amounts to be remitted to the Trustee for deposit into the
Certificate Account.

A separate Certificate Account will be established by the Trustee in the
name of the Trustee for the benefit of the Certificateholders into which all
funds received from the Master Servicer (or Servicer) and all required
withdrawals from any reserve funds for such Series will be deposited, pending
distribution to the Certificateholders. If specified in the related
Prospectus Supplement, any reinvestment income or other gain from investments
of funds in the Certificate Account will be credited to the Certificate
Account and any loss resulting from such investments will be charged to such
Certificate Account. Such reinvestment income, may, however, be payable to
the Trustee or the Master Servicer as additional compensation. On each
Distribution Date, all funds on deposit in the Certificate Account, subject
to certain permitted withdrawals by the Trustee as set forth in the Trust
Agreement, will be available for remittance to the Certificateholders. See
also "THE TRUST AGREEMENTS--Certificate Account" herein.

Other Funds or Accounts

A Trust Fund may include certain other funds and accounts or a security
interest in certain funds and accounts for the purpose of, among other
things, paying certain administrative fees and expenses of the Trust and
accumulating funds pending their distribution. If so specified in the related
Prospectus Supplement, certain funds may be established with the Trustee with
respect to Buy-Down Loans, GPM Loans, or other Loans having special payment
features included in the Trust Fund in addition to or in lieu of any such
similar funds to be held by the Servicer. See "SERVICING OF LOANS--Payments
on Loans; Deposits to Custodial Accounts." If Private Mortgage-Backed
Securities are backed by GPM Loans and the Asset Value with respect to a
Multi-Class Series is determined on the basis of the scheduled maximum
principal balance of the GPM Loans, a GPM Fund will be established which will
be similar to that which would be established if GPM Loans constituted the
Primary Assets. See "SERVICING OF LOANS--Payments on Loans; Deposits to
Custodial Accounts" herein. Other similar accounts may be established as
specified in the related Prospectus Supplement.

LOAN UNDERWRITING PROCEDURES AND STANDARDS

Underwriting Standards

The Depositor expects that all Loans comprising the Primary Assets for a
Series will have been originated generally in accordance with the
underwriting procedures and standards described herein, except as otherwise
set forth in the related Prospectus Supplement.

Unless otherwise specified in the related Prospectus Supplement, the
Mortgage Loans will have been originated by a savings and loan association,
savings bank, commercial bank, credit union, insurance company or similar
institution which is supervised and examined by a federal or state authority;
a mortgagee approved by the Secretary of Housing and Urban Development
pursuant to Sections 203 and 211 of the National Housing Act or a wholly-
owned subsidiary thereof; or by a subsidiary of the Depositor. Manufactured
Home Loans may have been originated by such institutions (other than a
subsidiary of the Depositor) or by a financial institution approved for
insurance by the Secretary of Housing and Urban Development pursuant to
Section 2 of the National Housing Act. Except as otherwise set forth in the
related Prospectus Supplement, the originator of a Loan will have applied
underwriting procedures intended to evaluate the borrower's credit standing
and repayment ability and the value and adequacy of the related property as
collateral. FHA Loans and VA Loans will have been originated in compliance
with the underwriting policies of the FHA and the VA, respectively.

In general, each borrower will have been required to complete an
application designed to provide to the original lender pertinent credit
information about the borrower. As part of the description of the borrower's
financial condition, the borrower generally will have furnished information
with respect to its assets, liabilities, income, credit history, employment
history and personal information, and furnished an authorization to apply for
a credit report which summarizes the borrower's credit history with local
merchants and lenders and any record of bankruptcy. In general, an
employment verification is obtained from an independent source (typically the
borrower's employer), which reports the length of employment with that
organization, the borrower's current salary and whether it is expected that
the borrower will continue such employment in the future. If the borrower was
self-employed, the borrower may have been required to submit copies of recent
signed tax returns. The borrower may also have been required to authorize
verifications of deposits at financial institutions where the borrower had
demand or savings accounts. With respect to Multifamily Property, information
concerning operating income and expenses will have been obtained from the
borrower showing operating income and expenses during the preceding three
calendar years. Certain considerations may cause an originator of Loans to
depart from these guidelines. For example, when two individuals co-sign the
loan documents, the incomes and expenses of both individuals may be included
in the computation.

The adequacy of the property financed by the related Loan as security
for repayment of such Loan will generally have been determined by appraisal
in accordance with pre-established appraisal procedure guidelines for
appraisals established by or acceptable to the originator. Appraisers may be
staff appraisers employed by the Loan originator or independent appraisers
selected in accordance with pre-established guidelines established by the
Loan originator. The appraisal procedure guidelines will have required that
the appraiser or an agent on its behalf personally inspect the property and
verify that it was in good condition and that construction, if new, had been
completed. If an appraisal was required, such appraisal will have been based
upon a market data analysis of recent sales of comparable properties and,
when deemed applicable, a replacement cost analysis based on the current cost
of constructing or purchasing a similar property.

In general, based on the data provided, certain verifications and the
appraisal, a determination will have been made by the original lender that
the borrower's monthly income would be sufficient to enable the borrower to
meet its monthly obligations on the Loan and other expenses related to the
property (such as property taxes, utility costs, standard hazard and primary
mortgage insurance and, if applicable, maintenance fees and other levies
assessed by a Cooperative or a condominium association) and certain other
fixed obligations other than housing expenses. The originating lender's
guidelines for Loans secured by Single Family Property generally will specify
that Scheduled Payments plus taxes and insurance and all Scheduled Payments
extending beyond one year (including those mentioned above and other fixed
obligations, such as car payments) would equal no more than specified
percentages of the prospective borrower's gross income. These guidelines will
generally be applied only to the payments to be made during the first year of
the Loan.

With respect to FHA Loans and VA Loans, traditional underwriting
guidelines used by the FHA and the VA, as the case may be, which were in
effect at the time of origination of each Loan will generally have been
applied. With respect to Multifamily Property, the Loan originator will have
made an assessment of the capabilities of the management of the project,
including a review of management's past performance record, its management
reporting and control procedures (to determine its ability to recognize and
respond to problems) and its accounting procedures to determine cash
management ability. Income derived from the Mortgaged Property constituting
investment property may have been considered for underwriting purposes,
rather than the income of the borrower from other sources. With respect to
Mortgaged Property consisting of vacation or second homes, no income derived
from the property will have been considered for underwriting purposes.

Certain types of Loans that may be included in the Primary Assets for a
Series may involve additional uncertainties not present in traditional types
of loans. For example, Buy-Down Loans, GEM Loans and GPM Loans provide for
escalating or variable payments by the borrower. These types of Loans are
underwritten on the basis of a judgment that the borrower will have the
ability to make larger Scheduled Payments in subsequent years. ARMs may
involve similar assessments.

To the extent specified in the related Prospectus Supplement, the
Depositor may purchase Loans (or participation interests therein) for
inclusion in a Trust Fund that are underwritten under standards and
procedures which vary from and are less stringent than those described
herein. For instance, Loans may be underwritten under a "limited
documentation" or "no documentation" program. With respect to such Loans,
minimal investigation into the borrowers' credit history and income profile
is undertaken by the originator and such Loans may be underwritten primarily
on the basis of an appraisal of the Mortgaged Property and Loan-to-Value
Ratio on origination.

In addition, Mortgage Loans may have been originated in connection with
a governmental program under which underwriting standards were significantly
less stringent and designed to promote home ownership or the availability of
affordable residential rental property notwithstanding higher risks of
default and losses. The related Prospectus Supplement will specify the
underwriting standards applicable to such Mortgage Loans.

Certain states where the Mortgaged Properties may be located have
"antideficiency" laws requiring, in general, that lenders providing credit on
Single Family Property look solely to the property for repayment in the event
of foreclosure. See "CERTAIN LEGAL ASPECTS OF LOANS" herein.

Loss Experience

The general appreciation of real estate values experienced in the past
has been a factor in limiting the general loss experience on Conventional
Loans. However, there can be no assurance that the past pattern of
appreciation in value of the real property securing such Loans will continue;
in fact, some regions of the country have experienced significant
depreciation in real estate values in recent periods. Further, there is no
assurance that appreciation of real estate values generally, if such
appreciation occurs, will limit loss experiences on non-traditional housing
such as Multifamily Property, Manufactured Homes or Cooperative Dwellings.
Similarly, no assurance can be given that the value of the Mortgaged Property
(including Cooperative Dwellings) securing a Loan has remained or will remain
at the level existing on the date of origination of such Loan. If the
residential real estate market in one or more regions of the United States
should experience decline in property values such that the outstanding
balances of the Loans and any secondary financing on the Mortgaged Properties
securing such Loans become equal to or greater than the value of such
Mortgaged Properties, then the actual rates of delinquencies, foreclosures
and losses could be higher than those now generally experienced in the
mortgage lending industry. See "CERTAIN LEGAL ASPECTS OF LOANS" herein.

No assurance can be given that values of Manufactured Homes have or will
remain at the levels existing on the dates of origination of the related
Loan. Manufactured Homes are less likely to experience appreciation in value
and more likely to experience depreciation in value over time than other
types of Mortgaged Property. Additionally, delinquency, loss and foreclosure
experience on Manufactured Home Loans may be adversely affected to a greater
degree by regional and local economic conditions than more traditional
Mortgaged Property. Loans secured by Multifamily Property may also be more
susceptible to losses due to changes in local and regional economic
conditions than Loans secured by other Single Family Property. For example,
unemployment resulting from an economic downturn in local industry may
sharply affect occupancy rates. Also, interest rate fluctuations can make
home ownership a more attractive alternative to renting, causing occupancy
rates and market rents to decline. New construction can create an oversupply,
particularly in a market that has experienced low vacancy rates.

To the extent that losses resulting from delinquencies, losses and
foreclosures or repossession of Mortgaged Property with respect to Loans
included in the Primary Assets for a Series of Certificates are not covered
by the methods of credit support or the insurance policies described herein
or in the related Prospectus Supplement, such losses will be borne by Holders
of the Certificates of such Series. Even where credit support covers all
losses resulting from delinquency and foreclosure or repossession, the effect
of foreclosures and repossessions may be to increase prepayment experience on
the Primary Assets, thus reducing average weighted life and affecting yield
to maturity. See "YIELD, PREPAYMENT AND MATURITY CONSIDERATIONS".

Representations and Warranties

Unless otherwise specified in the related Prospectus Supplement, in the
Trust Agreement, the Depositor, the Master Servicer or another entity will
represent and warrant to the Trustee with respect to the Mortgage Loans
comprising the Primary Assets in a Trust Fund, upon delivery of the Mortgage
Loans to the Trustee hereunder, among other things, that: (i) any required
title insurance (or in the case of Mortgaged Properties located in areas
where such policies are generally not available, an attorney's certificate of
title) and any required standard hazard and primary mortgage insurance was in
effect as of the date of such representation and warranty; (ii) immediately
prior to the transfer and assignment of the Mortgage Loans the Depositor (or
such other entity) with respect to each Mortgage Loan had good title to and
was sole owner of each such Mortgage Loan; (iii) with respect to first lien
Mortgage Loans, each Mortgage constituted a valid first lien on the related
Mortgaged Property (subject only to permissible title insurance exceptions)
and that the related Mortgaged Property was free of material damage and was
in good repair; (iv) each Mortgage Loan at the time it was made complied in
all material respects with applicable state and federal laws, including
usury, equal credit opportunity and truth-in-lending or similar disclosure
laws; and (v) each Mortgage Loan was current as to all required payments
(i.e., not more than one or two payments delinquent).

If the Mortgage Loans include Cooperative Loans, no representations or
warranties with respect to title insurance or hazard insurance will be given.
In addition, if the Mortgage Loans include Condominium Loans, no
representation regarding hazard insurance will be given. Generally, the
Cooperative or Condominium Association itself is responsible for the
maintenance of hazard insurance for property owned by the Cooperative and the
Condominium Association is responsible for maintaining standard hazard
insurance, insuring the entire Condominium Building (including each
individual Condominium Unit), and the borrowers of that Cooperative or
Condominium do not maintain separate hazard insurance on their individual
Cooperative Dwellings or Condominium Units. See "SERVICING OF LOANS--
Maintenance of Insurance Policies and Other Servicing Procedures" herein.
With respect to a Cooperative Loan, unless otherwise specified in the related
Prospectus Supplement, the Depositor will represent and warrant based, in
part, upon representations and warranties of the originator of such
Cooperative Loan that (i) with respect to first lien Cooperative Loans, the
security interest created by the cooperative security agreements is a valid
first lien on the collateral securing the Cooperative Loan (subject to the
right of the related Cooperative to cancel shares and terminate the
proprietary lease for unpaid assessments) and (ii) the related Cooperative
Dwelling is free of material damage and in good repair.

Unless otherwise specified in the related Prospectus Supplement, with
respect to each Manufactured Home Loan, the Depositor, based, in part, upon
representations and warranties of the originator of such Manufactured Home
Loan will represent and warrant, among other things that (i) immediately
prior to the transfer and assignment of the Manufactured Home Loans to the
Trustee, the Depositor had good title to, and was the sole owner of, each
Manufactured Home Loan; (ii) as of the date of such transfer and assignment,
the Manufactured Home Loans are subject to no offsets, defenses or
counterclaims; (iii) each Manufactured Home Loan at the time it was made
complied in all material respects with applicable state and federal laws,
including usury, equal credit opportunity and truth-in-lending or similar
disclosure laws; (iv) with respect to fist lien Manufactured Home Loans, as
of the date of such transfer and assignment, each Manufactured Home Loan
constitutes a valid first lien on the related Manufactured Home and such
Manufactured Home is free of material damage and is in good repair; (v) as of
the date of such representation and warranty, no Manufactured Home Loan is
more than 59 days delinquent and there are no delinquent tax or assessment
liens against the related Manufactured Home; and (vi) with respect to each
Manufactured Home Loan, any required hazard insurance policy was effective at
the origination of each Manufactured Home Loan and remained in effect on the
date of the transfer and assignment of the Manufactured Home Loan from the
Depositor and that all premiums due on such insurance have been paid in full.

Upon the discovery of the breach of any representation or warranty made
by the Depositor, the Master Servicer or another entity in respect of a Loan
that materially and adversely affects the value of such Loan, such entity
will be obligated to cure such breach in all material respects, repurchase
such Loan from the Trustee, or, unless specified otherwise in the related
Prospectus Supplement, deliver a Qualified Substitute Mortgage Loan as
described below under "THE TRUST AGREEMENTS--Assignment of Primary Assets."
The Depositor does not have, and is not expected in the future to have, any
significant assets with which to meet its obligations to repurchase or
substitute Loans as to which there has been a breach of any representation or
warranty, and its only source of funds to make such a substitution or
repurchase would be from funds obtained from the enforcement of a
corresponding obligation, if any, on the part of the originator or seller of
the Loans. See "Special Considerations--Limited Obligations and Assets of the
Depositor." The PMBS Trustee (in the case of Private Mortgage-Backed
Securities) or the Trustee, as applicable, will be required to enforce this
obligation following the practices it would employ in its good faith business
judgment were it the owner of such Loan. If so specified in the related
Prospectus Supplement, the Master Servicer may be obligated to enforce such
obligations rather than the Trustee or PMBS Trustee.

Substitution of Primary Assets

Substitution of Primary Assets will be permitted in the event of
breaches of representations and warranties with respect to any original
Primary Asset or in the event the documentation with respect to any Primary
Asset is determined by the Trustee to be incomplete. The period during which
such substitution will be permitted generally will be indicated in the
related Prospectus Supplement. The related Prospectus Supplement will
describe any other conditions upon which Primary Assets may be substituted
for Primary Assets initially included in the Trust Fund.

SERVICING OF LOANS

General

Customary servicing functions with respect to Loans constituting the
Primary Assets in the Trust Fund will be provided, as specified in the
related Prospectus Supplement, either by the Master Servicer directly or
through one or more servicers (the "Servicers") subject to supervision by the
Master Servicer, or by a single Servicer that is a party to the Trust
Agreement for a Series and services the Loans directly or through one or more
subservicers (the "Subservicers"). In general, descriptions herein of the
rights and obligations of a Master Servicer will also be applicable to a
Servicer, and descriptions herein of the rights and obligations of Servicers
that service Loans under the supervision of a Master Servicer will generally
be applicable to Subservicers. If the Master Servicer is not directly
servicing the Loans, then the Master Servicer will (i) administer and
supervise the performance by the Servicers of their servicing
responsibilities under their servicing agreements ("Servicing Agreements")
with the Master Servicer, (ii) maintain any standard or special hazard
insurance policy, primary mortgage insurance, bankruptcy bond or pool
insurance policy required for the related Loans and (iii) advance funds as
described below under "Advances". If the Master Servicer services the Loans
through Servicers as its agents, the Master Servicer may or may not, as
specified in the related Prospectus Supplement, be ultimately responsible for
the performance of all servicing activities, including those performed by the
Servicers, notwithstanding its delegation of certain responsibilities to such
Servicers. If a single Servicer services the Loans through Subservicers, such
Servicer will be ultimately responsible for the performance of all servicing
activities.

The Master Servicer will be a party to the Trust Agreement for any
Series for which Loans comprise the Primary Assets and may be a party to a
Participation Agreement executed with respect to any Participation
Certificates which constitute the Primary Assets. The Master Servicer may be
an affiliate of the Depositor. Unless otherwise specified in the related
Prospectus Supplement, the Master Servicer and each Servicer will be required
to be a FNMA- or FHLMC-approved seller/servicer and, in the case of FHA
Loans, approved by HUD as an FHA mortgagee.

The Master Servicer will be paid a Servicing Fee for the performance of
its services and duties under each Trust Agreement as specified in the
related Prospectus Supplement. Each Servicer, if any, will be entitled to
receive either a portion of the Servicing Fee or a separate fee. In addition,
the Master Servicer or Servicer may be entitled to retain late charges,
assumption fees and similar charges to the extent collected from mortgagors.
If a Servicer is terminated by the Master Servicer, the servicing function of
the Servicer will be either transferred to a substitute Servicer or performed
by the Master Servicer. The Master Servicer will be entitled to retain the
fee paid to the Servicer under a terminated Servicing Agreement if the Master
Servicer elects to perform such servicing functions itself.

The Master Servicer, at its election, may pay itself the Servicing Fee
for a Series with respect to each Mortgage Loan either by (a) withholding the
Servicing Fee from any scheduled payment of interest prior to the deposit of
such payment in the Collection Account for such Series, (b) withdrawing the
Servicing Fee from the Collection Account after the entire Scheduled Payment
has been deposited in the Collection Account, or (c) requesting that the
Trustee pay the Servicing Fee out of amounts in the Certificate Account.

Collection Procedures; Escrow Accounts

The Master Servicer, acting directly or through Servicers, will make
reasonable efforts to collect all payments required to be made under the
Mortgage Loans and will, consistent with the Trust Agreement for a Series and
any applicable insurance policies and other credit supports, follow such
collection procedures as it follows with respect to comparable loans held in
its own portfolio. Consistent with the above, the Master Servicer and any
Servicer may, in its discretion, (i) waive any assumption fee, late payment
charge, or other charge in connection with a Loan and (ii) arrange with a
mortgagor a schedule for the liquidation of delinquencies by extending the
Due Dates for Scheduled Payments on such Loan.

Unless otherwise specified in the related Prospectus Supplement, the
Master Servicer or the Servicers acting under its supervision, to the extent
permitted by law, will establish and maintain escrow or impound accounts
("Escrow Accounts") in which payments by borrowers to pay taxes, assessments,
mortgage and hazard insurance premiums, and other comparable items that are
required to be paid to the mortgagee will be deposited. However, Mortgage
Loans and Manufactured Home Loans may not require such payments under the
loan related documents, in which case the Master Servicer would not be
required to establish any Escrow Account with respect to such Loans.
Withdrawals from the Escrow Accounts are to be made to effect timely payment
of taxes, assessments, mortgage and hazard insurance premiums, to refund to
borrowers amounts determined to be overages, to pay interest to borrowers on
balances in the Escrow Account to the extent required by law, to repair or
otherwise protect the property securing the related Loan and to clear and
terminate such Escrow Account. The Master Servicer or the applicable
Servicers will be responsible for the administration of the Escrow Accounts
and generally will make advances to such account when a deficiency exists
therein.

Deposits to and Withdrawals from the Collection Account

The Master Servicer or the Trustee will establish a separate account
(the "Collection Account") in the name of the Trustee. The Collection Account
will be maintained in an account or accounts (i) at a depository institution,
the long-term unsecured debt obligations of which at the time of any deposit
therein are rated within the two highest rating categories by each Rating
Agency rating the Certificates of such Series, (ii) the deposits in which are
insured to the maximum extent available by the FDIC or which are secured in a
manner meeting requirements established by each Rating Agency or (iii) with a
depository institution otherwise acceptable to each Rating Agency.

The Collection Account may be maintained as an interest-bearing account,
or the funds held therein may be invested, pending remittance to the Trustee,
in Eligible Investments. If so specified in the related Prospectus
Supplement, the Master Servicer will be entitled to receive as additional
compensation any interest or other income earned on funds in the Collection
Account.

Unless otherwise specified in the related Prospectus Supplement, the
Master Servicer will deposit into the Collection Account for each Series on
the Business Day following the Closing Date any amounts representing
Scheduled Payments due after the related Cut-off Date but received by the
Master Servicer on or before the Closing Date, and thereafter, after the date
of receipt thereof, the following payments and collections received or made
by it (other than in respect of principal of and interest on the related
Loans due on or before such Cut-off Date):

(i) All payments on account of principal, including prepayments,
on such Loans;

(ii) All payments on account of interest on such Loans after
deducting therefrom, at the discretion of the Master Servicer but only
to the extent of the amount permitted to be withdrawn or withheld from
the Collection Account in accordance with the related Trust Agreement,
the Servicing Fee in respect of such Loans;

(iii) All amounts received by the Master Servicer in connection
with the liquidation of defaulted Loans or property acquired in respect
thereof, whether through foreclosure sale or otherwise, including
payments in connection with such Loans received from the mortgagor,
other than amounts required to be paid to the mortgagor pursuant to the
terms of the applicable Mortgage or otherwise pursuant to law
("Liquidation Proceeds"), exclusive of, in the discretion of the Master
Servicer but only to the extent of the amount permitted to be withdrawn
from the Collection Account in accordance with the related Trust
Agreement, the Servicing Fee, if any, in respect of the related Loan;

(iv) All proceeds received by the Trust under any title, hazard or
other insurance policy covering any such Loan, other than proceeds to be
applied to the restoration or repair of the Mortgaged Property or
released to the mortgagor in accordance with the related Trust Agreement
(which shall be retained by the Master Servicer and not deposited in the
Collection Account);

(v) All amounts required to be deposited therein from any
applicable Reserve Fund for such Series pursuant to the related Trust
Agreement;

(vi) All Advances for such Series made by the Master Servicer
pursuant to the related Trust Agreement; and

(vii) All proceeds of any such Loans repurchased by the Depositor
pursuant to the related Trust Agreement.

Unless otherwise specified in the related Prospectus Supplement, the
Master Servicer is permitted, from time to time, to make withdrawals from the
Collection Account for each Series for the following purposes:

(i) to reimburse itself for Advances for such Series made by it
pursuant to the related Trust Agreement; the Master Servicer's right to
reimburse itself is limited to amounts received on or in respect of
particular Loans (including, for this purpose, Liquidation Proceeds and
amounts representing proceeds of insurance policies covering the related
Mortgaged Property) which represent late recoveries of Scheduled
Payments respecting which any such Advance was made;

(ii) to reimburse itself for any Advances for such Series that the
Master Servicer determines in good faith it will be unable to recover
from amounts representing late recoveries of Scheduled Payments
respecting which such Advance was made or from Liquidation Proceeds or
the proceeds of insurance policies;

(iii) to reimburse itself from Liquidation Proceeds for
liquidation expenses and for amounts expended by it in good faith in
connection with the restoration of damaged Mortgaged Property and, to
the extent that Liquidation Proceeds after such reimbursement are in
excess of the outstanding principal balance of the related Loan,
together with accrued and unpaid interest thereon at the applicable
Pass-Through Rate to the Due Date next succeeding the date of its
receipt of such Liquidation Proceeds, to pay to itself out of such
excess the amount of any unpaid Servicing Fee and any assumption fees,
late payment charges, or other charges on the related Loan;

(iv) in the event it has elected not to pay itself the Servicing
Fee out of any interest component of any Scheduled Payment, late payment
or other recovery with respect to a particular Loan prior to the deposit
of such Scheduled Payment, late payment or recovery into the Collection
Account, to pay to itself the Servicing Fee, as adjusted pursuant to the
related Trust Agreement, from any the related Scheduled Payment, late
payment or such other recovery, to the extent permitted by such Trust
Agreement;

(v) to reimburse itself for expenses incurred by and recoverable
by or reimbursable to it pursuant to the related Trust Agreement;

(vi) to pay to itself with respect to each Loan or REO Property
acquired in respect thereof that has been repurchased by the Depositor
pursuant to the related Trust Agreement all amounts received thereon and
not distributed as of the date on which the related repurchase price was
determined;

(vii) to reimburse itself for the excess of any unreimbursed
Advances with respect to a particular Loan over the related Liquidation
Proceeds;

(viii) to make payments to the Trustee of such Series for deposit
into the Certificate Account, if any, or for remittance to the
Certificateholders of such Series in the amounts and in the manner
provided for in the related Trust Agreement; and

(ix) to clear and terminate the Collection Account pursuant to the
related Trust Agreement.

In addition, if the Master Servicer deposits in the Collection Account
for a series any amount not required to be deposited therein, it may, at any
time, withdraw such amount from such Collection Account.

Servicing Accounts

In those cases where a Servicer is servicing a Mortgage Loan, the
Servicer will establish and maintain an account (a "Servicing Account") that
will comply with the standards set forth above, and which is otherwise
acceptable to the Master Servicer. The Servicer is generally required to
deposit into the Servicing Account all amounts enumerated in the preceding
paragraph in respect of the Mortgage Loans received by the Servicer, less its
servicing compensation. On the date specified in the related Prospectus
Supplement, the Servicer will remit to the Master Servicer all funds held in
the Servicing Account with respect to each Mortgage Loan. The Servicer may,
to the extent described in the related Prospectus Supplement, be required to
advance any monthly installment of principal and interest that was not
received, less its servicing fee, by the date specified in the related
Prospectus Supplement.

Buy-Down Loans, GPM Loans and Other Subsidized Loans

With respect to each Buy-Down Loan, if any, included in a Trust Fund,
the Master Servicer will deposit all Buy-Down Amounts in a custodial account
(which may be interest-bearing) complying with the requirements set forth
above for the Collection Account (the "Buy-Down Fund"). The amount of such
deposit, together with investment earnings thereon at the rate specified in
the related Prospectus Supplement, will provide sufficient funds to support
the payments on such Buy-Down Loan on a level debt service basis. The Master
Servicer will not be obligated to add to the Buy-Down Fund should amounts
therein and investment earnings prove insufficient to maintain the scheduled
level of payments on the Buy-Down Loans, in which event distributions to the
Certificateholders may be affected. Unless otherwise provided in the related
Prospectus Supplement, a Buy-Down Fund will not be included in or deemed to
be a part of the Trust Fund. Unless otherwise specified in the related
Prospectus Supplement, the terms of all Buy-Down Loans provide for the
contribution of buy-down funds in an amount equal to or exceeding either (i)
the total payments to be made from such funds pursuant to the related buydown
plan or (ii) if such buy-down funds are present valued, that amount of buy-
down funds which, together with investment earnings thereon at a specified
rate, compounded monthly, will support the scheduled level of payments due
under the Buy-Down Loan. Neither the Master Servicer, any Servicer nor the
Depositor will be obligated to add to such buy-down funds any of its own
funds should investment earnings prove insufficient to maintain the scheduled
level of payments on the Buy-Down Loan, in which event distributions to
Certificateholders may be affected. With respect to each Buy-Down Loan, the
Master Servicer will deposit in the Collection Account the amount, if any, of
the buy-down funds (and, if applicable, investment earnings thereon) for each
Buy-Down Loan that, when added to the amount due from the borrower on such
Buy-Down Loan, equals the full monthly payment which would be due on the Buy-
Down Loan if it were not subject to the buy-down plan.

If the borrower on a Buy-Down Loan prepays such Loan in its entirety
during the Buy-Down Period, the Master Servicer will withdraw from the Buy-
Down Fund and remit to the borrower in accordance with the related buy-down
plan any buy-down funds remaining in the Buy-Down Fund. If a prepayment by a
borrower during the Buy-Down Period together with buy-down funds will result
in a prepayment in full, the Master Servicer will withdraw from the Buy-Down
Fund for deposit in the Collection Account the buy-down funds and investment
earnings thereon, if any, which together with such prepayment will result in
a prepayment in full. If the borrower defaults during the Buy-Down Period
with respect to a Buy-Down Loan and the property securing the related Loan is
sold in liquidation (either by the Master Servicer or the insurer under any
related insurance policy), the Master Servicer will withdraw from the Buy-
Down Fund the buy-down funds and all investment earnings thereon, if any, for
deposit in the Collection Account or remit the same to the insurer if the
mortgaged property is transferred to such insurer and such insurer pays all
of the loss incurred in respect of such default. In the case of any such
prepaid or defaulted Buy-Down Loan, the buy-down funds in respect of which
were supplemented by investment earnings, the Master Servicer will withdraw
from the Buy-Down Fund and retain or remit to the borrower, depending upon
the terms of the buy-down plan, any investment earnings remaining in the
related Buy-Down Fund.

The terms of certain of the Loans may provide for the contribution of
subsidy funds by the seller of the related Mortgaged Property or by another
entity. With respect to each such Loan, the Master Servicer will deposit the
subsidy funds in a custodial account (which may be interest-bearing)
complying with the requirements set forth above for the Collection Account (a
"Subsidy Fund"). Unless otherwise specified in the related Prospectus
Supplement, the terms of each such Loan will provide for the contribution of
the entire undiscounted amount of subsidy amounts necessary to maintain the
scheduled level of payments due during the early years of such Loan. Neither
the Master Servicer, any Servicer nor the Depositor will be obligated to add
to such Subsidy Fund any of its own funds. Unless otherwise provided in the
related Prospectus Supplement, such Subsidy Fund will not be included in or
deemed to be a part of the Trust Fund.

If the Depositor values any GPM Loans deposited into the Trust Fund for
a Multi-Class Series on the basis of such GPM Loan's scheduled maximum
principal balance, the Master Servicer will, if and to the extent provided in
the related Prospectus Supplement, deposit in a custodial account (which may
be interest bearing) (the "GPM Fund") complying with the requirements set
forth above for the Collection Account an amount which, together with
reinvestment income thereon at the rate set forth in the related Prospectus
Supplement, will be sufficient to cover the amount by which payments of
principal and interest on such GPM Loans assumed in calculating payments due
on the Certificates of such Multi-Class Series exceed the scheduled payments
on such GPM Loans. The Trustee will withdraw amounts from the GPM Fund for a
Series upon a prepayment of such GPM Loan as necessary and apply such amounts
to the payment of principal and interest on the Certificates of such Series.
Neither the Depositor, the Master Servicer nor any Servicer will be obligated
to supplement the GPM Fund should amounts therein and investment earnings
thereon prove insufficient to maintain the scheduled level of payments, in
which event, distributions to the Certificateholders may be affected. Unless
otherwise specified in the related Prospectus Supplement, such GPM Fund will
not be included in or deemed to be part of the Trust Fund.

With respect to any other type of Loan which provides for payments other
than on the basis of level payments, an account may be established as
described in the related Prospectus Supplement on terms similar to those
relating to the Buy-Down Fund, the Subsidy Fund or the GPM Fund.

Advances and Limitations Thereon

General. The related Prospectus Supplement will describe the
circumstances under which the Master Servicer or Servicer will make Advances
with respect to delinquent payments on Loans. Unless otherwise specified in
the related Prospectus Supplement, neither the Master Servicer nor any
Servicer will be obligated to make Advances, and such obligation may be
limited in amount, may be limited to advances received from the Servicers, if
any, or may not be activated until a certain portion of a specified reserve
fund is depleted. If the Master Servicer is obligated to make Advances, a
surety bond or other credit support may be provided with respect to such
obligation as described in the related Prospectus Supplement. Advances are
intended to provide liquidity and not to guarantee or insure against losses.
Accordingly, any funds advanced are recoverable by the Servicer or the Master
Servicer, as the case may be, out of amounts received on particular Loans
which represent late recoveries of principal or interest, proceeds of
insurance policies or Liquidation Proceeds respecting which any such Advance
was made. If an Advance is made and subsequently determined to be
nonrecoverable from late collections, proceeds of Insurance Policies, or
Liquidation Proceeds from the related Loan, the Servicer or Master Servicer
will be entitled to reimbursement from other funds in the Collection Account
or Servicing Account, as the case may be, or from a specified Reserve Fund as
applicable, to the extent specified in the related Prospectus Supplement.

Advances in Connection With Prepaid Loans. In addition, when a borrower
makes a principal prepayment in full between Due Dates on the related Loan,
the borrower will generally be required to pay interest on the principal
amount prepaid only to the date of such prepayment. If and to the extent
provided in the related Prospectus Supplement, in order that one or more
Classes of the Certificateholders of a Series will not be adversely affected
by any resulting shortfall in interest, the Master Servicer may be obligated
to advance moneys from its own funds to the extent necessary to include in
its remittance to the Trustee for deposit into the Certificate Account an
amount equal to a full Scheduled Payment of interest on the related Loan
(adjusted to the applicable Pass-Through Rate). Any such principal
prepayment, together with a full Scheduled Payment of interest thereon at the
applicable Pass-Through Rate (to the extent of such adjustment or advance),
will be distributed to Certificateholders on the related Distribution Date.
If the amount necessary to include a full Scheduled Payment of interest as
described above exceeds the amount which the Master Servicer is obligated to
advance, as applicable, a shortfall may occur as a result of a prepayment in
full. See "YIELD, PREPAYMENT AND MATURITY CONSIDERATIONS".

Maintenance of Insurance Policies and Other Servicing Procedures

Standard Hazard Insurance; Flood Insurance. Except as otherwise
specified in the related Prospectus Supplement, the Master Servicer will be
required to maintain or to cause the borrower on each Loan to maintain or
will use its best reasonable efforts to cause each Servicer of a Loan to
maintain a standard hazard insurance policy providing coverage of the
standard form of fire insurance with extended coverage for certain other
hazards as is customary in the state in which the property securing the
related Loan is located. See "DESCRIPTION OF MORTGAGE AND OTHER INSURANCE"
herein. Unless otherwise specified in the related Prospectus Supplement,
coverage will be in an amount at least equal to the greater of (i) the amount
necessary to avoid the enforcement of any co-insurance clause contained in
the policy or (ii) the outstanding principal balance of the related Loan. The
Master Servicer will also maintain on REO Property that secured a defaulted
Loan and that has been acquired upon foreclosure, deed in lieu of
foreclosure, or repossession, a standard hazard insurance policy in an amount
that is at least equal to the maximum insurable value of such REO Property.
No earthquake or other additional insurance will be required of any borrower
or will be maintained on REO Property acquired in respect of a defaulted
Loan, other than pursuant to such applicable laws and regulations as shall at
any time be in force and shall require such additional insurance. When, at
the time of origination of a Loan, the property securing that Loan is located
in a federally designated special flood hazard area, the Master Servicer will
cause to be maintained or use its best reasonable efforts to cause the
Servicer to maintain with respect to such property flood insurance as
required under the Flood Disaster Protection Act of 1973, to the extent
available, or as described in the related Prospectus Supplement.

Any amounts collected by the Master Servicer or the Servicer, as the
case may be, under any such policies of insurance (other than amounts to be
applied to the restoration or repair of the Mortgaged Property, released to
the borrower in accordance with normal servicing procedures or used to
reimburse the Master Servicer for amounts to which it is entitled to
reimbursement) will be deposited in the Collection Account. In the event that
the Master Servicer obtains and maintains a blanket policy insuring against
hazard losses on all of the Loans, written by an insurer then acceptable to
each Rating Agency which assigns a rating to such Series, it will
conclusively be deemed to have satisfied its obligations to cause to be
maintained a standard hazard insurance policy for each Loan or related REO
Property. This blanket policy may contain a deductible clause, in which case
the Master Servicer will, in the event that there has been a loss that would
have been covered by such policy absent such deductible clause, deposit in
the Collection Account the amount not otherwise payable under the blanket
policy because of the application of such deductible clause.

The Depositor will not require that a standard hazard or flood insurance
policy be maintained on the Cooperative Dwelling relating to any Cooperative
Loan. Generally, the Cooperative itself is responsible for maintenance of
hazard insurance for the property owned by the cooperative and the tenant-
stockholders of that cooperative do not maintain individual hazard insurance
policies. To the extent, however, that a Cooperative and the related borrower
on a Cooperative Loan do not maintain such insurance or do not maintain
adequate coverage or any insurance proceeds are not applied to the
restoration of damaged property, any damage to such borrower's Cooperative
Dwelling or such Cooperative's building could significantly reduce the value
of the collateral securing such Cooperative Loan to the extent not covered by
other credit support. Similarly, the Depositor will not require that a
standard hazard or flood insurance policy be maintained on a Condominium Unit
relating to any Condominium Loan. Generally, the Condominium Association is
responsible for maintenance of hazard insurance insuring the entire
Condominium building (including each individual Condominium Unit), and the
owner(s) of an individual Condominium Unit do not maintain separate hazard
insurance policies. To the extent, however, that a Condominium Association
and the related borrower on a Condominium Loan do not maintain such insurance
or do not maintain adequate coverage or any insurance proceeds are not
applied to the restoration of damaged property, any damage to such borrower's
Condominium Unit or the related Condominium Building could significantly
reduce the value of the collateral securing such Condominium Loan to the
extent not covered by other credit support.

Special Hazard Insurance Policy. To the extent specified in the related
Prospectus Supplement, the Master Servicer will maintain a special hazard
insurance policy, in full force and effect with respect to the Loans. Unless
otherwise specified in the related Prospectus Supplement, the special hazard
insurance policy will provide for a fixed premium rate based on the declining
aggregate outstanding principal balance of the Loans. The Master Servicer
will agree to pay the premium for any special hazard insurance policy on a
timely basis. If the special hazard insurance policy is cancelled or
terminated for any reason (other than the exhaustion of total policy
coverage), the Master Servicer will exercise its best reasonable efforts to
obtain from another insurer a replacement policy comparable to the terminated
special hazard insurance policy with a total coverage which is equal to the
then existing coverage of the terminated special hazard insurance policy;
provided that if the cost of any such replacement policy is greater than the
cost of the terminated special hazard insurance policy, the amount of
coverage under the replacement policy will, unless otherwise specified in the
related Prospectus Supplement, be reduced to a level such that the applicable
premium does not exceed 150% of the cost of the special hazard insurance
policy that was replaced. Any amounts collected by the Master Servicer under
the special hazard insurance policy in the nature of insurance proceeds will
be deposited in the Collection Account (net of amounts to be used to repair,
restore or replace the related property securing the Loan or to reimburse the
Master Servicer (or a Servicer) for related amounts owed to it). Certain
characteristics of the special hazard insurance policy are described under
"DESCRIPTION OF MORTGAGE AND OTHER INSURANCE--Hazard Insurance on the Loans."

Primary Mortgage Insurance. To the extent described in the related
Prospectus Supplement, the Master Servicer will be required to use its best
reasonable efforts to keep, or to cause each Servicer to keep, in full force
and effect, a primary mortgage insurance policy with respect to each
Conventional Loan secured by Single Family Property for which such coverage
is required for as long as the related mortgagor is obligated to maintain
such primary mortgage insurance under the terms of the related Loan. The
Master Servicer will not cancel or refuse to renew any such primary mortgage
insurance policy in effect at the date of the initial issuance of the
Certificates that is required to be kept in force unless a replacement
primary mortgage insurance policy for such cancelled or nonrenewed policy is
maintained with a Qualified Insurer.

Primary insurance policies will be required with respect to Manufactured
Home Loans only to the extent described in the related Prospectus Supplement.
If primary mortgage insurance is to be maintained with respect to
Manufactured Home Loans, the Master Servicer will be required to maintain
such insurance as described above. For further information regarding the
extent of coverage under a primary mortgage insurance policy, see
"DESCRIPTION OF MORTGAGE AND OTHER INSURANCE--Mortgage Insurance on the
Loans."

FHA Insurance and VA Guarantees. To the extent specified in the related
Prospectus Supplement, all or a portion of the Loans may be insured by the
FHA or guaranteed by the VA. The Master Servicer will be required to take
such steps as are reasonably necessary to keep such insurance and guarantees
in full force and effect. See "DESCRIPTION OF MORTGAGE AND OTHER INSURANCE--
Mortgage Insurance on the Loans."

Pool Insurance Policy. If so specified in the related Prospectus
Supplement, the Master Servicer will be obligated to use its best reasonable
efforts to maintain a pool insurance policy with respect to the Loans in the
amount and with the coverage described in the related Prospectus Supplement.
Unless otherwise specified in the related Prospectus Supplement, the pool
insurance policy will provide for a fixed premium rate on the declining
aggregate outstanding principal balance of the Loans. The Master Servicer
will be obligated to pay the premiums for such pool insurance policy on a
timely basis.

The related Prospectus Supplement will identify the pool insurer for
each Series of Certificates. If the pool insurer ceases to be a Qualified
Insurer because it is not approved as an insurer by FHLMC or FNMA or because
its claims-paying ability is no longer rated in the category required by the
related Prospectus Supplement, the Master Servicer will be obligated to
review, no less often than monthly, the financial condition of the pool
insurer to determine whether recoveries under the pool insurance policy are
jeopardized by reason of the financial condition of the pool insurer. If the
Master Servicer determines that recoveries may be so jeopardized or if the
pool insurer ceases to be qualified under applicable law to transact a
mortgage guaranty insurance business, the Master Servicer will exercise its
best reasonable efforts to obtain from another Qualified Insurer a comparable
replacement pool insurance policy with a total coverage equal to the then
outstanding coverage of the pool insurance policy to be replaced; provided
that, if the premium rate on the replacement policy is greater than that of
the existing pool insurance policy, then the coverage of the replacement
policy will, unless otherwise specified in the related Prospectus Supplement,
be reduced to a level such that its premium rate does not exceed 150% of the
premium rate on the pool insurance policy to be replaced. Payments made under
a pool insurance policy will be deposited into the Collection Account (net of
expenses of the Master Servicer or any related unreimbursed advances or
unpaid Servicing Fee). Certain characteristics of the pool insurance policy
are described under "DESCRIPTION OF MORTGAGE AND OTHER INSURANCE--Mortgage
Insurance on the Loans."

Bankruptcy Bond. If so specified in the related Prospectus Supplement,
the Master Servicer will be obligated to use its best reasonable efforts to
obtain and thereafter maintain a bankruptcy bond or similar insurance or
guaranty in full force and effect throughout the term of the related Trust
Agreement, unless coverage thereunder has been exhausted through payment of
claims. If so specified in the Prospectus Supplement, the Master Servicer
will be required to pay from its servicing compensation the premiums for the
bankruptcy bond on a timely basis. Coverage under the bankruptcy bond may be
cancelled or reduced by the Master Servicer at any time, provided that such
cancellation or reduction does not adversely affect the then current rating
of the related Series of Certificates. See "DESCRIPTION OF MORTGAGE AND OTHER
INSURANCE--Bankruptcy Bond" herein.

Presentation of Claims; Realization Upon Defaulted Loans.

The Master Servicer, on behalf of the Trustee and the
Certificateholders, will be required to present or cause to be presented,
claims with respect to any standard hazard insurance policy, pool insurance
policy, special hazard insurance policy, bankruptcy bond, or primary mortgage
insurance policy, and to the FHA and the VA, if applicable in respect of any
FHA insurance or VA guarantee respecting defaulted Mortgage Loans.

The Master Servicer will use its reasonable best efforts to foreclose
upon, repossess or otherwise comparably convert the ownership of the real
properties securing such of the related Loans as come into and continue in
default and as to which no satisfactory arrangements can be made for
collection of delinquent payments. In connection with such foreclosure or
other conversion, the Master Servicer will follow such practices and
procedures as it deems necessary or advisable and as are normal and usual in
its servicing activities with respect to comparable loans serviced by it.
However, the Master Servicer will not be required to expend its own funds in
connection with any foreclosure or towards the restoration of the property
unless it determines that: (i) such restoration or foreclosure will increase
the Liquidation Proceeds in respect of the related Mortgage Loan available to
the Certificateholders after reimbursement to itself for such expenses and
(ii) that such expenses will be recoverable by it either through Liquidation
Proceeds or the proceeds of insurance. Notwithstanding anything to the
contrary herein, in the case of a Trust Fund for which a REMIC election has
been made, the Master Servicer shall not liquidate any collateral acquired
through foreclosure later than one year after the acquisition of such
collateral. While the holder of Mortgaged Property acquired through
foreclosure can often maximize its recovery by providing financing to a new
purchaser, the Trust Fund will have no ability to do so and neither the
Master Servicer nor any Servicer will be required to do so.

Similarly, if any property securing a defaulted Loan is damaged and
proceeds, if any, from the related standard hazard insurance policy or the
applicable special hazard insurance policy, if any, are insufficient to
restore the damaged property to a condition sufficient to permit recovery
under any pool insurance policy or any primary mortgage insurance policy, FHA
insurance, or VA guarantee, neither the Master Servicer nor any Servicer will
be required to expend its own funds to restore the damaged property unless it
determines (i) that such restoration will increase the Liquidation Proceeds
in respect of such Loan after reimbursement of the expenses incurred by such
Servicer or the Master Servicer and (ii) that such expenses will be
recoverable by it through proceeds of the sale of the property or proceeds of
the related pool insurance policy or any related primary mortgage insurance
policy, FHA insurance, or VA guarantee.

As to collateral securing a Cooperative Loan, any prospective purchaser
will generally have to obtain the approval of the board of directors of the
relevant cooperative before purchasing the shares and acquiring rights under
the proprietary lease or occupancy agreement securing that Cooperative Loan.
See "CERTAIN LEGAL ASPECTS OF LOANS--Foreclosure on Shares of Cooperatives"
herein. This approval is usually based on the purchaser's income and net
worth and numerous other factors. Although the Cooperative's approval is
unlikely to be unreasonably withheld or delayed, the necessity of acquiring
such approval could limit the number of potential purchasers for those shares
and otherwise limit the Trust Fund's ability to sell and realize the value of
those shares.

With respect to a Loan secured by a Multifamily Property, the market
value of any property obtained in foreclosure or by deed in lieu of
foreclosure will be based substantially on the operating income obtained by
renting the dwelling units. As a default on a Loan secured by Multifamily
Property is likely to have occurred because operating income, net of
expenses, is insufficient to make debt service payments on the related Loan,
it can be anticipated that the market value of such property will be less
than anticipated when such Loan was originated. To the extent that equity
does not cushion the loss in market value and such loss is not covered by
other credit support, a loss may be experienced by the related Trust Fund.
With respect to a defaulted Manufactured Home Loan, the value of the related
Manufactured Home can be expected to be less on resale than the value of a
new Manufactured Home. To the extent equity does not cushion the loss in
market value, and such loss is not covered by other credit support, a loss
may be experienced by the Trust Fund.

Enforcement of Due-On-Sale Clauses

Unless otherwise specified in the related Prospectus Supplement for a
Series, when any Mortgaged Property is about to be conveyed by the borrower,
the Master Servicer will, to the extent it has knowledge of such prospective
conveyance and prior to the time of the consummation of such conveyance,
exercise its rights to accelerate the maturity of such Loan under the
applicable "due-on-sale" clause, if any, unless it reasonably believes that
such clause is not enforceable under applicable law or if the enforcement of
such clause would result in loss of coverage under any primary mortgage
insurance policy. If such conditions are not met or the Master Servicer
reasonably believes that enforcement of a due-on-sale clause will not be
enforceable, the Master Servicer is authorized to accept from or enter into
an assumption agreement with the person to whom such property has been or is
about to be conveyed, pursuant to which such person becomes liable under the
Loan and pursuant to which the original borrower is released from liability
and such person is substituted as the borrower and becomes liable under the
Loan. Any fee collected in connection with an assumption will be retained by
the Master Servicer as additional servicing compensation. The terms of a Loan
may not be changed in connection with an assumption except that, if the terms
of the Loan so permit, and subject to certain other conditions, the interest
rate may be increased (but not decreased) to a prevailing market rate. Unless
otherwise specified in the related Prospectus Supplement, Certificateholders
would not benefit from any such increase.

Certain Rights Related to Foreclosure

Certain rights in connection with foreclosure of defaulted Mortgage
Loans may be granted to the holders of the Class of Subordinate Certificates
ranking lowest in priority and, when such Certificates are no longer
outstanding, to the holders of the Class of Subordinate Certificates ranking
next lowest in priority. Such rights may include the right to delay
foreclosure until a Mortgage Loan has been delinquent for six months,
provided that upon election to delay foreclosure such holder establishes a
reserve fund for the benefit of the Trust Fund in an amount equal to 125% of
the greater of the Scheduled Principal Balance of such Mortgage Loan or the
appraised value of the related Mortgaged Property, plus three months' accrued
interest on such Mortgage Loan. Any exercise of such right to delay
foreclosure could affect the amount recovered upon liquidation of the related
Mortgaged Property. Such rights may also include the right to recommend
foreclosure or alternatives to foreclosure with respect to a defaulted
Mortgage Loan, and the right to purchase defaulted Mortgage Loan from the
Trust Fund.

Servicing Compensation and Payment of Expenses

Except as otherwise provided in the related Prospectus Supplement, the
Master Servicer or any Servicer will be entitled to a servicing fee in an
amount to be determined as specified in the related Prospectus Supplement.
The servicing fee may be fixed or variable, as specified in the related
Prospectus Supplement. In addition, unless otherwise specified in the related
Prospectus Supplement, the Master Servicer or any Servicer will be entitled
to servicing compensation in the form of assumption fees, late payment
charges, or excess proceeds following disposition of property in connection
with defaulted Loans.

Unless otherwise specified in the related Prospectus Supplement, the
Master Servicer will pay the fees of the Servicers, if any, and certain
expenses incurred in connection with the servicing of the Loans, including,
without limitation, the payment of the fees and expenses of the Trustee and
independent accountants, payment of insurance policy premiums and the cost of
credit support, if any, payment of expenses incurred in enforcing the
obligations of Servicers and in preparation of reports to Certificateholders.
Certain of these expenses may be reimbursable pursuant to the terms of the
Trust Agreement from Liquidation Proceeds and the proceeds of insurance
policies and, in the case of enforcement of the obligations of Servicers,
from any recoveries in excess of amounts due with respect to the related
Loans or from specific recoveries of costs.

The Master Servicer will be entitled to reimbursement for certain
expenses incurred by it in connection with the liquidation of defaulted
Loans. The related Trust Fund will suffer no loss by reason of such expenses
to the extent claims are paid under related insurance policies or from the
Liquidation Proceeds. If claims are either not made or paid under the
applicable insurance policies or if coverage thereunder has been exhausted,
the related Trust Fund will suffer a loss to the extent that Liquidation
Proceeds, after reimbursement of the Master Servicer's expenses, are less
than the outstanding principal balance of and unpaid interest on the related
Loan which would be distributable to Certificateholders. In addition, the
Master Servicer will be entitled to reimbursement of expenditures incurred by
it in connection with the restoration of property securing a defaulted Loan,
such right of reimbursement being prior to the rights of the
Certificateholders to receive any related proceeds of insurance policies,
Liquidation Proceeds or amounts derived from other credit supports. The
Master Servicer is also entitled to reimbursement from the Collection Account
for Advances. In addition, when a borrower makes a principal prepayment in
full between Due Dates on the related Loan, the borrower will generally be
required to pay interest on the amount prepaid only to the date of
prepayment. If and to the extent provided in the related Prospectus
Supplement, in order that one or more Classes of the Certificateholders of a
Series will not be adversely affected by any resulting shortfall in interest,
the amount of the Servicing Fee may be reduced to the extent necessary to
include in the Master Servicer's remittance to the Trustee for deposit into
the Certificate Account an amount equal to a full scheduled payment of
interest on the related Loan (adjusted to the applicable Pass-Through Rate).
Any such principal prepayment, together with a full Scheduled Payment of
interest thereon at the applicable Pass-Through Rate (to the extent of such
adjustment or advance), will be distributed to Certificateholders on the
related Distribution Date. If the amount necessary to include a full
Scheduled Payment of interest as described above exceeds the amount of the
Servicing Fee, a shortfall to Certificateholders may occur as a result of a
prepayment in full. See "YIELD, PREPAYMENT AND MATURITY CONSIDERATIONS".

The rights of the Master Servicer to receive funds from the Collection
Account for a Series, whether as the Servicing Fee or other compensation, or
for the reimbursement of Advances, expenses or otherwise, are not subordinate
to the rights of Certificateholders of such Series.

Evidence as to Compliance

Unless otherwise specified in the related Prospectus Supplement, the
Trust Agreement for each Series will provide that each year, a firm of
independent public accountants will furnish a statement to the Trustee to the
effect that such firm has examined certain documents and records relating to
the servicing of mortgage loans by the Master Servicer and that, on the basis
of such examination, such firm is of the opinion that the servicing has been
conducted in compliance with the Trust Agreement except for (i) such
exceptions as such firm believes to be immaterial and (ii) such other
exceptions as are set forth in such statement.

The Trust Agreement for each Series will also provide for delivery to
the Trustee for such Series of an annual statement signed by an officer of
the Master Servicer to the effect that the Master Servicer has fulfilled its
obligations under the Trust Agreement throughout the preceding calendar year.

Certain Matters Regarding the Master Servicer

The Master Servicer for each Series will be identified in the related
Prospectus Supplement. The Master Servicer may be an affiliate of the
Depositor and may have other business relationships with the Depositor and
its affiliates.

In the event of an Event of Default under the Trust Agreement, the
Master Servicer may be replaced by the Trustee or a successor Master
Servicer. See "THE TRUST AGREEMENTS--Rights upon Events of Default" herein.

Unless otherwise provided in the Prospectus Supplement, the Master
Servicer has the right to assign its rights and delegate its duties and
obligations under the Trust Agreement for each Series; provided that the
purchaser or transferee accepting such assignment or delegation: (i) is
qualified to service mortgage loans for FNMA or FHLMC, (ii) is reasonably
satisfactory to the Trustee for the related Series, (iii) has a net worth of
not less than $15,000,000, (iv) executes and delivers to the Trustee an
agreement, in form and substance reasonably satisfactory to the Trustee,
which contains an assumption by such purchaser or transferee of the due and
punctual performance and observance of each covenant and condition to be
performed or observed by the Master Servicer under the Trust Agreement from
and after the date of such agreement and (v) provided further that each
Rating Agency's rating of the Certificates for such Series in effect
immediately prior to such assignment, sale or transfer is not qualified,
downgraded or withdrawn as a result of such assignment, sale or transfer. No
such assignment will become effective until the Trustee or a successor Master
Servicer has assumed the Master Servicer's obligations and duties under the
Trust Agreement. To the extent that the Master Servicer transfers its
obligations to a wholly-owned subsidiary or affiliate, such subsidiary or
affiliate need not satisfy the criteria set forth above, however, in such
instance, the assigning Master Servicer will remain liable for the servicing
obligations under the Trust Agreement. Any entity into which the Master
Servicer is merged or consolidated or any successor corporation resulting
from any merger, conversion or consolidation will succeed to the Master
Servicer's obligations under the related Trust Agreement, provided that such
successor or surviving entity meets the requirements for a successor Master
Servicer set forth in the preceding paragraph.

Each Trust Agreement will also provide that neither the Master Servicer,
nor any director, officer, employee or agent of the Master Servicer, will be
under any liability to the related Trust Fund or the Certificateholders for
any action taken or for failing to take any action in good faith pursuant to
the Trust Agreement or for errors in judgment; provided, however, that
neither the Master Servicer nor any such person will be protected against any
breach of warranty or representations made under the Trust Agreement or the
failure to perform its obligations in compliance with any standard of care
set forth in the Trust Agreement or liability which would otherwise be
imposed by reason of willful misfeasance, bad faith or negligence in the
performance of their duties or by reason of reckless disregard of their
obligations and duties thereunder. Each Trust Agreement will further provide
that the Master Servicer and any director, officer, employee or agent of the
Master Servicer is entitled to indemnification from the related Trust Fund
and will be held harmless against any loss, liability or expense incurred in
connection with any legal action relating to the Trust Agreement or the
Certificates, other than any loss, liability or expense incurred by reason of
willful misfeasance, bad faith or negligence in the performance of duties
thereunder or by reason of reckless disregard of obligations and duties
thereunder. In addition, the Trust Agreement provides that the Master
Servicer is not under any obligation to appear in, prosecute or defend any
legal action which is not incidental to its servicing responsibilities under
the Trust Agreement which, in its opinion, may involve it in any expense or
liability. The Master Servicer may, in its discretion, undertake any such
action which it may deem necessary or desirable with respect to the Trust
Agreement and the rights and duties of the parties thereto and the interests
of the Certificateholders thereunder. In such event, the legal expenses and
costs of such action and any liability resulting therefrom will be expenses,
costs, and liabilities of the Trust Fund and the Master Servicer will be
entitled to be reimbursed therefor out of the Collection Account.

CREDIT SUPPORT

General

For any Series, credit support may be provided with respect to one or
more Classes thereof or the related Primary Assets. Credit support may be in
the form of a letter of credit, the subordination of one or more Classes of
the Certificates of such series, the establishment of one or more reserve
funds, use of a pool insurance policy, bankruptcy bond, repurchase bond or
special hazard insurance policy, certificate guarantee insurance, the use of
cross-support features or another method of credit support described in the
related Prospectus Supplement, or any combination of the foregoing, in any
case, in such amounts and having such terms and conditions as are acceptable
to each Rating Agency. If so specified in the related Prospectus Supplement,
any form of credit support (including but not limited to insurance, letters
of credit or certificate guarantee insurance) may be structured so as to be
drawn upon by more than one Trust Fund to the extent described therein.

Unless otherwise specified in the related Prospectus Supplement for a
Series, the credit support will not provide protection against all risks of
loss and will not guarantee repayment of the entire principal balance of the
Certificates and interest thereon at the Pass-Through Rate or Certificate
Interest Rate, as applicable. If losses occur which exceed the amount covered
by credit support or which are not covered by the credit support,
Certificateholders will bear their allocable share of deficiencies. See "THE
TRUST AGREEMENTS--Deficiency Event." Moreover, if a form of credit support
covers more than one Trust Fund (each, a "Covered Trust"), holders of
Certificates issued by any of such Covered Trusts will be subject to the risk
that such credit support will be exhausted by the claims of other Covered
Trusts prior to such Covered Trust receiving any of its intended share of
such coverage. If credit support is provided with respect to a Series, or the
related Primary Assets, the related Prospectus Supplement will include a
description of (a) the amount payable under such credit support, (b) any
conditions to payment thereunder not otherwise described herein, (c) the
conditions (if any) under which the amount payable under such credit support
may be reduced and under which such credit support may be terminated or
replaced and (d) the material provisions of any agreement relating to such
credit support. Additionally, the related Prospectus Supplement will set
forth certain information with respect to the issuer of any third-party
credit support, including (a) a brief description of its principal business
activities, (b) its principal place of business, place of incorporation and
the jurisdiction under which it is chartered or licensed to do business, (c)
if applicable, the identity of regulatory agencies which exercise primary
jurisdiction over the conduct of its business and (d) its total assets, and
its stockholders' or policyholders' surplus, if applicable, as of the date
specified in the Prospectus Supplement.

Subordinate Certificates; Subordination Reserve Fund

If so specified in the related Prospectus Supplement, one or more
Classes of a Series may be Subordinate Certificates. If so specified in the
related Prospectus Supplement, the rights of the Subordinate
Certificateholders to receive distributions of principal and interest from
the Certificate Account on any Distribution Date will be subordinated to such
rights of the Senior Certificateholders to the extent of the then applicable
Subordinated Amount as defined in the related Prospectus Supplement. The
Subordinated Amount will decrease whenever amounts otherwise payable to the
Subordinate Certificateholders are paid to the Senior Certificateholders
(including amounts withdrawn from the Subordination Reserve Fund, if any, and
paid to the Senior Certificateholders), and will (unless otherwise specified
in the related Prospectus Supplement) increase whenever there is distributed
to the Subordinate Certificateholders amounts in respect of which
subordination payments have previously been paid to the Senior
Certificateholders (which will occur when subordination payments in respect
of delinquencies and certain other deficiencies have been recovered).

A Series may include a Class of Subordinate Certificates entitled to
receive cash flows remaining after distributions are made to all other
Classes. Such right will effectively be subordinate to the rights of other
Certificateholders, but will not be limited to the Subordinated Amount. If so
specified in the related Prospectus Supplement, the subordination of a Class
may apply only in the event of (or may be limited to) certain types of losses
not covered by Insurance Policies or other credit support, such as losses
arising from damage to property securing a Loan not covered by standard
hazard insurance policies, losses resulting from the bankruptcy of a borrower
and application of certain provisions of the Bankruptcy Code, or losses
resulting from the denial of insurance coverage due to fraud or
misrepresentation in connection with the origination of a Loan.

With respect to any Series which includes one or more Classes of
Subordinate Certificates, a Subordination Reserve Fund may be established if
so specified in the related Prospectus Supplement. The Subordination Reserve
Fund, if any, will be funded with cash, a letter of credit, a demand note or
Eligible Reserve Fund Investments, or by the retention of amounts of
principal or interest otherwise payable to Holders of Subordinate
Certificates, or both, as specified in the related Prospectus Supplement. The
Subordination Reserve Fund will not be a part of the Trust Fund, unless
otherwise specified in the related Prospectus Supplement. If the
Subordination Reserve Fund is not a part of the Trust Fund, the Trustee will
have a security interest therein on behalf of the Senior Certificateholders.
Moneys will be withdrawn from the Subordination Reserve Fund to make
distributions of principal of or interest on Senior Certificates under the
circumstances set forth in the related Prospectus Supplement.

Moneys deposited in any Subordinated Reserve Fund will be invested in
Eligible Reserve Fund Investments. Unless otherwise specified in the related
Prospectus Supplement, any reinvestment income or other gain from such
investments will be credited to the Subordinated Reserve Fund for such
Series, and any loss resulting from such investments will be charged to such
Subordinated Reserve Fund. Amounts in any Subordinated Reserve Fund in excess
of the Required Reserve Fund Balance may be periodically released to the
Subordinate Certificateholders under the conditions and to the extent
specified in the related Prospectus Supplement. Additional information
concerning any Subordinated Reserve Fund will be set forth in the related
Prospectus Supplement, including the amount of any initial deposit to such
Subordinated Reserve Fund, the Required Reserve Fund Balance to be maintained
therein, the purposes for which funds in the Subordinated Reserve Fund may be
applied to make distributions to Senior Certificateholders and the employment
of reinvestment earnings on amounts in the Subordinated Reserve Fund, if any.

Cross-Support Features

If the Primary Assets for a Series are divided into separate Asset
Groups, the beneficial ownership of which is evidenced by a separate Class or
Classes of a Series, credit support may be provided by a cross-support
feature which requires that distributions be made on Senior Certificates
evidencing the beneficial ownership of one Asset Group prior to distributions
on Subordinate Certificates evidencing the beneficial ownership interest in
another Asset Group within the Trust Fund. The related Prospectus Supplement
for a Series which includes a cross-support feature will describe the manner
and conditions for applying such cross-support feature.

Insurance

Credit support with respect to a Series may be provided by various forms
of insurance policies, subject to limits on the aggregate dollar amount of
claims that will be payable under each such insurance policy, with respect to
all Loans comprising or underlying the Primary Assets for a Series, or such
of the Loans as have certain characteristics. Such insurance policies include
primary mortgage insurance and standard hazard insurance and may, if
specified in the related Prospectus Supplement, include a pool insurance
policy covering losses in amounts in excess of coverage of any primary
insurance policy, a special hazard insurance policy covering certain risks
not covered by standard hazard insurance policies, a bankruptcy bond covering
certain losses resulting from the bankruptcy of a borrower and application of
certain provisions of the Bankruptcy Code, a repurchase bond covering the
repurchase of a Loan for which mortgage insurance or hazard insurance
coverage has been denied due to misrepresentations in connection with the
origination of the related Loan, or other insurance covering other risks
associated with the particular type of Loan. See "DESCRIPTION OF MORTGAGE AND
OTHER INSURANCE." Copies of the actual pool insurance policy, special hazard
insurance policy, bankruptcy bond or repurchase bond, if any, relating to the
Loans comprising the Primary Assets for a Series will be filed with the
Commission as an exhibit to a Current Report on Form 8-K to be filed within
15 days of issuance of the Certificates of the related Series.

Letter of Credit

The letter of credit, if any, with respect to a Series of Certificates
will be issued by the bank or financial institution specified in the related
Prospectus Supplement (the "L/C Bank"). Under the letter of credit, the L/C
Bank will be obligated to honor drawings thereunder in an aggregate fixed
dollar amount, net of unreimbursed payments thereunder, equal to the
percentage specified in the related Prospectus Supplement of the aggregate
principal balance of the Loans on the related Cut-off Date or of one or more
Classes of Certificates (the "L/C Percentage"). If so specified in the
related Prospectus Supplement, the letter of credit may permit drawings in
the event of losses not covered by insurance policies or other credit
support, such as losses arising from damage not covered by standard hazard
insurance policies, losses resulting from the bankruptcy of a borrower and
the application of certain provisions of the Bankruptcy Code, or losses
resulting from denial of insurance coverage due to misrepresentations in
connection with the origination of a Loan. The amount available under the
letter of credit will, in all cases, be reduced to the extent of the
unreimbursed payments thereunder. The obligations of the L/C Bank under the
letter of credit for each Series of Certificates will expire at the earlier
of the date specified in the related Prospectus Supplement or the termination
of the Trust Fund. See "DESCRIPTION OF THE CERTIFICATES--Optional
Termination" and "THE TRUST AGREEMENTS--Termination." A copy of the letter of
credit for a Series, if any, will be filed with the Commission as an exhibit
to a Current Report on Form 8-K to be filed within 15 days of issuance of the
Certificates of the related Series.

Certificate Guarantee Insurance

Certificate guarantee insurance, if any, with respect to a Series of
Certificates will be provided by one or more insurance companies. Such
certificate guarantee insurance will guarantee, with respect to one or more
Classes of Certificates of the related Series, timely distributions of
interest and full distributions of principal on the basis of a schedule of
principal distributions set forth in or determined in the manner specified in
the related Prospectus Supplement. If so specified in the related Prospectus
Supplement, the certificate guarantee insurance will also guarantee against
any payment made to a Certificateholder which is subsequently recovered as a
"voidable preference" payment under the Bankruptcy Code. A copy of the
certificate guarantee insurance for a Series, if any, will be filed with the
Commission as an exhibit to a Current Report on Form 8-K to be filed with the
Commission within 15 days of issuance of the Certificates of the related
Series.

Reserve Funds

One or more Reserve Funds may be established with respect to a Series,
in which cash, a letter of credit, Eligible Reserve Fund Investments, a
demand note or a combination thereof, in the amounts, if any, so specified in
the related Prospectus Supplement will be deposited. The Reserve Funds for a
Series may also be funded over time by depositing therein a specified amount
of the distributions received on the related Primary Assets as specified in
the related Prospectus Supplement.

Amounts on deposit in any Reserve Fund for a Series, together with the
reinvestment income thereon, will be applied by the Trustee for the purposes,
in the manner, and to the extent specified in the related Prospectus
Supplement. A Reserve Fund may be provided to increase the likelihood of
timely payments of principal of and interest on the Certificates, if required
as a condition to the rating of such Series by each Rating Agency, or to
reduce the likelihood of Special Distributions with respect to any Multi-
Class Series. If so specified in the related Prospectus Supplement, Reserve
Funds may be established to provide limited protection, in an amount
satisfactory to each Rating Agency, against certain types of losses not
covered by Insurance Policies or other credit support, such as losses arising
from damage not covered by standard hazard insurance policies, losses
resulting from the bankruptcy of a borrower and the application of certain
provisions of the Bankruptcy Code or losses resulting from denial of
insurance coverage due to fraud or misrepresentation in connection with the
origination of a Loan. Following each Distribution Date amounts in such
Reserve Fund in excess of any required Reserve Fund balance may be released
from the Reserve Fund under the conditions and to the extent specified in the
related Prospectus Supplement and will not be available for further
application by the Trustee.

Moneys deposited in any Reserve Funds will be invested in Eligible
Reserve Fund Investments, except as otherwise specified in the related
Prospectus Supplement. Unless otherwise specified in the related Prospectus
Supplement, any reinvestment income or other gain from such investments will
be credited to the related Reserve Fund for such Series, and any loss
resulting from such investments will be charged to such Reserve Fund.
However, such income may be payable to the Master Servicer or a Servicer as
additional servicing compensation. See "SERVICING OF LOANS" and "THE TRUST
AGREEMENTS--Investment of Funds." The Reserve Fund, if any, for a Series will
not be a part of the Trust Fund unless otherwise specified in the related
Prospectus Supplement.

Additional information concerning any Reserve Fund will be set forth in
the related Prospectus Supplement, including the initial balance of such
Reserve Fund, the required Reserve Fund balance to be maintained, the
purposes for which funds in the Reserve Fund may be applied to make
distributions to Certificateholders and use of investment earnings from the
Reserve Fund, if any.

DESCRIPTION OF MORTGAGE AND OTHER INSURANCE

The following descriptions of primary mortgage insurance policies, pool
insurance policies, special hazard insurance policies, standard hazard
insurance policies, bankruptcy bonds, repurchase bonds and other insurance
and the respective coverages thereunder are general descriptions only and do
not purport to be complete. If so specified in the relevant Prospectus
Supplement, any of such insurance may be structured so as to protect against
losses relating to more than one Trust Fund in the manner described therein.

Mortgage Insurance on the Loans

General. Unless otherwise specified in the related Prospectus
Supplement, all Mortgage Loans that are Conventional Loans secured by Single
Family Property and which had initial Loan-to-Value Ratios of greater than
80% will be covered by primary mortgage insurance policies providing coverage
on the amount of each such Mortgage Loan in excess of 75% of the original
Appraised Value of the related Mortgaged Property and remaining in force
until the principal balance of such Mortgage Loan is reduced to 80% of such
original Appraised Value. In addition, each Mortgage Loan that is a
Conventional Loan secured by a vacation or second home and which had a Loan-
to-Value Ratio of more than 70% at origination will be covered by a primary
mortgage insurance policy until the principal balance of such Mortgage Loan
is reduced to below 70% of Appraised Value.

A pool insurance policy will be obtained if so specified in the related
Prospectus Supplement to cover any loss (subject to limitations described
herein) occurring as a result of default by the borrowers to the extent not
covered by any primary mortgage insurance policy or FHA Insurance. See "Pool
Insurance Policy" below. Neither the primary mortgage insurance policies nor
any pool insurance policy will insure against certain losses sustained in the
event of a personal bankruptcy of the borrower under a Mortgage Loan. See
"CERTAIN LEGAL ASPECTS OF LOANS" herein. Such losses will be covered to the
extent described in the related Prospectus Supplement by the bankruptcy bond
or other credit support, if any.

To the extent that the primary mortgage insurance policies do not cover
all losses on a defaulted or foreclosed Mortgage Loan, and to the extent such
losses are not covered by the pool insurance policy or other credit support
for such Series, such losses, if any, would affect payments to
Certificateholders. In addition, the pool insurance policy and primary
mortgage insurance policies do not provide coverage against hazard losses.
See "Hazard Insurance on the Loans" below. Certain hazard risks will not be
insured and the occurrence of such hazards could adversely affect payments to
Certificateholders.

Primary Mortgage Insurance. Although the terms and conditions of
primary mortgage insurance vary, the amount of a claim for benefits under a
primary mortgage insurance policy covering a Mortgage Loan (herein referred
to as the "Insured Loss") generally will consist of the insured percentage
(typically ranging from 12% to 25%) of the unpaid principal amount of the
covered Mortgage Loan and accrued and unpaid interest thereon and
reimbursement of certain expenses, less (i) all rents or other payments
collected or received by the insured (other than the proceeds of hazard
insurance) that are derived from or in any way related to the Mortgaged
Property, (ii) hazard insurance proceeds in excess of the amount required to
restore the mortgaged property and which have not been applied to the payment
of the Mortgage Loan, (iii) amounts expended but not approved by the mortgage
insurer, (iv) claim payments previously made by the mortgage insurer and (v)
unpaid premiums.

Primary mortgage insurance policies reimburse certain losses sustained
by reason of defaults in payments by borrowers. Primary mortgage insurance
policies will not insure against, and exclude from coverage, a loss sustained
by reason of a default arising from or involving certain matters, including
(i) fraud or negligence in origination or servicing of the Mortgage Loans,
including misrepresentation by the originator, borrower or other persons
involved in the origination of the Mortgage Loan; (ii) failure to construct
the Mortgaged Property subject to the Mortgage Loan in accordance with
specified plans; (iii) physical damage to the Mortgaged Property; and (d) the
related Servicer not being approved as a servicer by the mortgage insurer.

Primary mortgage insurance policies generally contain provisions
substantially as follows: (i) under the policy, a claim includes unpaid
principal, accrued interest at the applicable loan interest rate to the date
of filing of a claim thereunder and certain advances (with a limitation on
attorneys' fees for foreclosures of 3% of the unpaid principal balance and
accumulated delinquent interest) described below; (ii) when a claim is
presented, the mortgage insurer will have the option of (a) paying the claim
in full and taking title to the property and arranging for the sale thereof
or (b) paying the insured percentage of the claim and allowing the insured to
retain title to the property; (iii) unless earlier directed by the mortgage
insurer, claims must be made within a specified period of time (typically, 60
days) after the insured has acquired good and marketable title to the
property; and (iv) a claim must be paid within a specific period of time
(typically, 60 days) after the claim is accepted by the mortgage insurer.

As conditions precedent to the filing of or payment of a claim under a
primary mortgage insurance policy covering a Mortgage Loan, the insured will
be required to (i) advance or discharge (a) all hazard insurance policy
premiums and (b) as necessary and approved in advance by the mortgage
insurer, (1) real estate property taxes, (2) all expenses required to
maintain the related Mortgaged Property in at least as good a condition as
existed at the effective date of such primary mortgage insurance policy,
ordinary wear and tear excepted, (3) Mortgaged Property sales expenses, (4)
any outstanding liens (as defined in such primary mortgage insurance policy)
on the Mortgaged Property and (5) foreclosure costs, including court costs
and reasonable attorneys' fees; (ii) in the event of any physical loss or
damage to the Mortgaged Property, have restored and repaired the Mortgaged
Property to at least as good a condition as existed at the effective date of
such primary mortgage insurance policy, ordinary wear and tear excepted; and
(iii) tender to the mortgage insurer good and marketable title to and
possession of the Mortgaged Property.

Other provisions and conditions of each primary mortgage insurance
policy covering a Mortgage Loan will generally include that: (a) no change
may be made in the terms of such Mortgage Loan without the consent of the
mortgage insurer; (b) written notice must be given to the mortgage insurer
within 10 days after the insured becomes aware that a borrower is delinquent
in the payment of a sum equal to the aggregate of two Scheduled Payments due
under such Mortgage Loan or that any proceedings affecting the borrower's
interest in the Mortgaged Property securing such Mortgage Loan have been
commenced, and thereafter the insured must report monthly to the mortgage
insurer the status of any such Mortgage Loan until such Mortgage Loan is
brought current, such proceedings are terminated or a claim is filed; (c) the
mortgage insurer will have the right to purchase such Mortgage Loan, at any
time subsequent to the 10 days' notice described in (b) above and prior to
the commencement of foreclosure proceedings, at a price equal to the unpaid
principal amount of the Mortgage Loan plus accrued and unpaid interest
thereon at the applicable Mortgage Rate and reimbursable amounts expended by
the insured for the real estate taxes and fire and extended coverage
insurance on the Mortgaged Property for a period not exceeding 12 months and
less the sum of any claim previously paid under the policy with respect to
such Mortgage Loan and any due and unpaid premium with respect to such
policy; (d) the insured must commence proceedings at certain times specified
in the policy and diligently proceed to obtain good and marketable title to
and possession of the mortgaged property; (e) the insured must notify the
mortgage insurer of the institution of such proceedings, provide it with
copies of documents relating thereto, notify the mortgage insurer of the
price amounts specified in (c) above at least 15 days prior to the sale of
the Mortgaged Property by foreclosure, and bid such amount unless the
mortgage insurer specifies a lower or higher amount; and (f) the insured may
accept a conveyance of the Mortgaged Property in lieu of foreclosure with
written approval of the mortgage insurer, provided the ability of the insured
to assign specified rights to the mortgage insurer are not thereby impaired
or the specified rights of the mortgage insurer are not thereby adversely
affected.

The mortgage insurer will be required to pay to the insured either: (i)
the insured percentage of the loss; or (ii) at its option under certain of
the primary mortgage insurance policies, the sum of the delinquent Scheduled
Payments plus any advances made by the insured, both to the date of the claim
payment, and thereafter, Scheduled Payments in the amount that would have
become due under the Mortgage Loan if it had not been discharged plus any
advances made by the insured until the earlier of (a) the date the Mortgage
Loan would have been discharged in full if the default had not occurred, or
(b) an approved sale. Any rents or other payments collected or received by
the insured which are derived from or are in any way related to the mortgaged
property will be deducted from any claim payment.

FHA Insurance and VA Guarantees. The FHA is responsible for
administering various federal programs, including mortgage insurance,
authorized under the Housing Act, as amended, and the United States Housing
Act of 1937, as amended. Mortgage Loans designated in the related Prospectus
Supplement as FHA Loans will be insured under various FHA programs including
the standard FHA 203(b) program to finance the acquisition of one-to-four-
family housing units and the FHA 245 graduated payment mortgage program.
These programs generally limit the principal amount and interest rates of the
mortgage loans insured. Mortgage Loans insured by the FHA generally require
a minimum down payment of approximately 5% of the original principal amount
of the loan. No FHA-insured Mortgage Loans relating to a Series may have an
interest rate or original principal amount exceeding the applicable FHA
limits at the time of origination of such loan.

The insurance premiums for FHA Loans will be collected by HUD-approved
lenders or by the Master Servicer or Servicer and paid to the FHA. The
regulations governing FHA single-family mortgage insurance programs provide
that insurance benefits are payable either upon foreclosure (or other
acquisition of possession) and conveyance of the mortgaged premises to HUD or
upon assignment of the defaulted Mortgage Loan to HUD. With respect to a
defaulted FHA Loan, the Master Servicer or Servicer is limited in its ability
to initiate foreclosure proceedings. When it is determined, by the Master
Servicer or Servicer or HUD, that default was caused by circumstances beyond
the mortgagor's control, the Master Servicer or Servicer is expected to make
an effort to avoid foreclosure by entering, if feasible, into one of a number
of available forms of forbearance plans with the mortgagor. Such plans may
involve the reduction or suspension of Scheduled Payments for a specified
period, with such payments to be made up on or before the maturity date of
the Mortgage Note, or the rescheduling or other adjustment of payments due
under the Mortgage Note up to or beyond the scheduled maturity date. In
addition, when a default caused by such circumstances is accompanied by
certain other criteria, HUD may provide relief by making payments to the
Master Servicer or the Servicer in partial or full satisfaction of amounts
due under the Mortgage Loan (which payments are to be repaid by the borrower
to HUD) or by accepting assignment of the Mortgage Loan from the Master
Servicer or the Servicer. With certain exceptions, at least three full
installments must be due and unpaid under the Mortgage Loan, and HUD must
have rejected any request for relief from the mortgagor before the Master
Servicer or the Servicer may initiate foreclosure proceedings.

HUD has the option, in most cases, to pay insurance claims in cash or in
debentures issued by HUD. Presently, claims are being paid in cash, and
claims have not been paid in debentures since 1965. HUD debentures issued in
satisfaction of FHA insurance claims bear interest at the applicable HUD
debenture interest rate. The Master Servicer or the Servicer of each FHA Loan
will be obligated to purchase any such debenture issued in satisfaction of a
defaulted FHA Loan serviced by it for an amount equal to the unpaid principal
balance of the FHA Loan.

The amount of insurance benefits generally paid by the FHA is equal to
the entire unpaid principal amount of the defaulted Mortgage Loan adjusted to
reimburse the Master Servicer or the Servicer for certain costs and expenses
and to deduct certain amounts received or retained by the Master Servicer or
the Servicer after default. When entitlement to insurance benefits results
from foreclosure (or other acquisition of possession) and conveyance to HUD,
the Master Servicer or the Servicer is compensated for no more than two-
thirds of its foreclosure costs, and is compensated for interest accrued and
unpaid prior to such date but in general only to the extent it was allowed
pursuant to a forbearance plan approved by HUD. When entitlement to insurance
benefits results from assignment of the Mortgage Loan to HUD, the insurance
payment includes full compensation for interest accrued and unpaid to the
assignment date. The insurance payment itself, upon foreclosure of an FHA
Loan, bears interest from a date 30 days after the borrower's first
uncorrected failure to perform any obligation or make any payment due under
the Mortgage Loan and, upon assignment, from the date of assignment, to the
date of payment of the claim, in each case at the same mortgage rate as the
applicable HUD debenture interest rate as described above.

Mortgage Loans designated in the related Prospectus Supplement as VA
Loans will be partially guaranteed by the VA under the Servicemen's
Readjustment Act of 1944, as amended (a "VA Guaranty"). The Serviceman's
Readjustment Act of 1944, as amended, permits a veteran (or in certain
instances the spouse of a veteran) to obtain a mortgage loan guaranty by the
VA covering mortgage financing of the purchase of a one-to four-family
dwelling unit at interest rates permitted by the VA. The program has no
mortgage loan limits, requires no down payment from the purchaser and permits
the guarantee of mortgage loans of up to 30 years' duration. However, no
Mortgage Loan guaranteed by the VA will have an original principal amount
greater than five times the partial VA guaranty for such Mortgage Loan.

With respect to a defaulted VA Loan, the Master Servicer or the Servicer
is, absent exceptional circumstances, authorized to announce its intention to
foreclose only when the default has continued for three months. Generally, a
claim for the guarantee is submitted after liquidation of the mortgaged
property.

The amount payable under the guarantee will be the percentage of the VA
Loan originally guaranteed applied to indebtedness outstanding as of the
applicable date of computation as specified in the VA regulations. Payments
under the guarantee will equal the unpaid principal amount of the VA Loan,
interest accrued on the unpaid balance of the VA Loan to the appropriate date
of computation and limited expenses of the mortgagee, but in each case only
to the extent that such amounts have not been recovered through liquidation
of the Mortgaged Property. The amount payable under the guarantee may in no
event exceed the amount of the original guarantee.

The maximum guaranty that may be issued by the VA under a VA guaranteed
mortgage loan depends upon the original principal amount of the mortgage
loan, as further described in 38 United States Code Section 1803(a), as
amended. As of January 1, 1990, the maximum guaranty that may be issued by
the VA under a VA guaranteed mortgage loan of more than $144,000 is the
lesser of 25% of the original principal amount of the mortgage loan and
$46,000. The liability on the guarantee is reduced or increased pro rata with
any reduction or increase in the amount of indebtedness, but in no event will
the amount payable on the guarantee exceed the amount of the original
guarantee. The VA may, at its option and without regard to the guarantee,
make full payment to a mortgagee of unsatisfied indebtedness on a mortgage
upon its assignment to the VA.

Pool Insurance Policy. If so specified in the related Prospectus
Supplement, the Master Servicer will be required to maintain a pool insurance
policy and to present or cause the Servicers, if any, to present claims
thereunder on behalf of the Trustee and the Certificateholders. See
"SERVICING OF LOANS--Maintenance of Insurance Policies and Other Servicing
Procedures." Although the terms and conditions of pool insurance policies
vary to some degree, the following describes material aspects of such
policies generally. The related Prospectus Supplement will describe any
provisions of a pool insurance policy which are materially different from
those described below. It may also be a condition precedent to the payment of
any claim under the pool insurance policy that the insured maintain a primary
mortgage insurance policy that is acceptable to the pool insurer on all
Mortgage Loans in the related Trust Fund that have Loan-to-Value Ratios at
the time of origination in excess of 80% and that a claim under such primary
mortgage insurance policy has been submitted and settled. FHA Insurance and
VA Guarantees may be deemed to be acceptable primary insurance policies under
the pool insurance policy. Assuming satisfaction of these conditions, the
pool insurer will pay to the insured the amount of the loss which will
generally be: (i) the amount of the unpaid principal balance of the defaulted
Mortgage Loan immediately prior to the approved sale of the Mortgaged
Property, (ii) the amount of the accumulated unpaid interest on such Mortgage
Loan to the date of claim settlement at the contractual rate of interest and
(iii) advances made by the insured as described above less certain payments.
An "approved sale" is (i) a sale of the Mortgaged Property acquired by the
insured because of a default by the borrower to which the pool insurer has
given prior approval, (ii) a foreclosure or trustee's sale of the Mortgaged
Property at a price exceeding the maximum amount specified by the pool
insurer, (iii) the acquisition of the Mortgaged Property under the primary
mortgage insurance policy by the mortgage insurer or (iv) the acquisition of
the Mortgaged Property by the pool insurer.

As a condition precedent to the payment of any loss, the insured must
provide the pool insurer with good and marketable title to the Mortgaged
Property. If any Mortgaged Property securing a defaulted Mortgage Loan is
damaged and the proceeds, if any, from the related standard hazard insurance
policy or the applicable special hazard insurance policy, if any, are
insufficient to restore the damaged Mortgaged Property to a condition
sufficient to permit recovery under the pool insurance policy, the Master
Servicer will not be required to expend its own funds to restore the damaged
property unless it determines (i) that such restoration will increase the
proceeds to the Certificateholders on liquidation of the Mortgage Loan after
reimbursement of the Master Servicer for its expenses and (ii) that such
expenses will be recoverable by it through liquidation proceeds or insurance
proceeds.

The original amount of coverage under the mortgage pool insurance policy
will be reduced over the life of the Certificates by the aggregate net dollar
amount of claims paid less the aggregate net dollar amount realized by the
pool insurer upon disposition of all foreclosed mortgaged properties covered
thereby. The amount of claims paid includes certain expenses incurred by the
Master Servicer as well as accrued interest at the applicable interest rate
on delinquent Mortgage Loans to the date of payment of the claim. See
"CERTAIN LEGAL ASPECTS OF LOANS" herein. Accordingly, if aggregate net claims
paid under a mortgage pool insurance policy reach the original policy limit,
coverage under the mortgage pool insurance policy will lapse and any further
losses will be borne by the Trust Fund, and thus will affect adversely
payments on the Certificates. In addition, the exhaustion of coverage under
any mortgage pool insurance policy may affect the Master Servicer's or
Servicer's willingness or obligation to make Advances. If the Master Servicer
or a Servicer determines that an Advance in respect of a delinquent Loan
would not be recoverable from the proceeds of the liquidation of such Loan or
otherwise, it will not be obligated to make an advance respecting any such
delinquency since the Advance would not be ultimately recoverable by it. See
"SERVICING OF LOANS--Advances and Limitations Thereon."

Mortgage Insurance with Respect to Manufactured Home Loans. A
Manufactured Home Loan may be an FHA Loan or a VA Loan. Any primary mortgage
or similar insurance and any pool insurance policy with respect to
Manufactured Home Loans will be described in the related Prospectus
Supplement.

Hazard Insurance on the Loans

Standard Hazard Insurance Policies. The standard hazard insurance
policies will provide for coverage at least equal to the applicable state
standard form of fire insurance policy with extended coverage for property of
the type securing the related Loans. In general, the standard form of fire
and extended coverage policy will cover physical damage to or destruction of,
the improvements on the property caused by fire, lightning, explosion, smoke,
windstorm, hail, riot, strike and civil commotion, subject to the conditions
and exclusions particularized in each policy. Because the standard hazard
insurance policies relating to the Loans will be underwritten by different
hazard insurers and will cover properties located in various states, such
policies will not contain identical terms and conditions. The basic terms,
however, generally will be determined by state law and generally will be
similar. Most such policies typically will not cover any physical damage
resulting from war, revolution, governmental actions, floods and other water-
related causes, earth movement (including earthquakes, landslides, and
mudflows), nuclear reaction, wet or dry rot, vermin, rodents, insects or
domestic animals, theft and, in certain cases, vandalism. The foregoing list
is merely indicative of certain kinds of uninsured risks and is not intended
to be all-inclusive. Uninsured risks not covered by a special hazard
insurance policy or other form of credit support will adversely affect
distributions to Certificateholders. When a property securing a Loan is
located in a flood area identified by HUD pursuant to the Flood Disaster
Protection Act of 1973, as amended, the Master Servicer will be required to
cause flood insurance to be maintained with respect to such property, to the
extent available.

The standard hazard insurance policies covering properties securing
Loans typically will contain a "coinsurance" clause which, in effect, will
require the insured at all times to carry hazard insurance of a specified
percentage (generally 80% to 90%) of the full replacement value of the
dwellings, structures and other improvements on the Mortgaged Property in
order to recover the full amount of any partial loss. If the insured's
coverage falls below this specified percentage, such clause will provide that
the hazard insurer's liability in the event of partial loss will not exceed
the greater of (i) the actual cash value (generally defined as the
replacement cost at the time and place of loss, less physical depreciation)
of the dwellings, structures and other improvements damaged or destroyed or
(ii) such proportion of the loss, without deduction for depreciation, as the
amount of insurance carried bears to the specified percentage of the full
replacement cost of such dwellings, structures and other improvements on the
Mortgaged Property. Since the amount of hazard insurance to be maintained on
the improvements securing the Loans declines as the principal balances owing
thereon decrease, and since the value of residential real estate in the area
where the Mortgaged Property is located fluctuates in value over time, the
effect of this requirement in the event of partial loss may be that hazard
insurance proceeds will be insufficient to restore fully the damage to the
Mortgaged Property.

The Depositor will not require that a standard hazard or flood insurance
policy be maintained for any Cooperative Loan. Generally, the Cooperative is
responsible for maintenance of hazard insurance for the property owned by the
Cooperative and the tenant-stockholders of that Cooperative do not maintain
individual hazard insurance policies. To the extent, however, that either the
Cooperative or the related borrower do not maintain such insurance, or do not
maintain adequate coverage, or do not apply any insurance proceeds to the
restoration of damaged property, then damage to such borrower's Cooperative
Dwelling or such Cooperative's building could significantly reduce the value
of the Mortgaged Property securing such Cooperative Loan. Similarly, the
Depositor will not require that a standard hazard or flood insurance policy
be maintained for any Condominium Loan. Generally, the Condominium
Association is responsible for maintenance of hazard insurance for the
Condominium Building (including the individual Condominium Units) and the
owner(s) of an individual Condominium Unit do not maintain separate hazard
insurance policies. To the extent, however, that either the Condominium
Association or the related borrower do not maintain such insurance, or do not
maintain adequate coverage, or do not apply any insurance proceeds to the
restoration of damaged property, then damage to such borrower's Condominium
Unit or such Condominium Building could significantly reduce the value of the
Mortgaged Property securing such Condominium Loan.

Special Hazard Insurance Policy. Although the terms of such policies
vary to some degree, a special hazard insurance policy typically provides
that, where there has been damage to property securing a defaulted or
foreclosed Loan (title to which has been acquired by the insured) and to the
extent such damage is not covered by the standard hazard insurance policy or
any flood insurance policy, if applicable, required to be maintained with
respect to such property, or in connection with partial loss resulting from
the application of the coinsurance clause in a standard hazard insurance
policy, the special hazard insurer will pay the lesser of (i) the cost of
repair or replacement of such property or (ii) upon transfer of the property
to the special hazard insurer, the unpaid principal balance of such Loan at
the time of acquisition of such property by foreclosure or deed in lieu of
foreclosure, plus accrued interest to the date of claim settlement and
certain expenses incurred by the Master Servicer or the Servicer with respect
to such property. If the unpaid principal balance plus accrued interest and
certain expenses is paid by the special hazard insurer, the amount of further
coverage under the special hazard insurance policy will be reduced by such
amount less any net proceeds from the sale of the property. Any amount paid
as the cost of repair of the property will reduce coverage by such amount.
Special hazard insurance policies typically do not cover losses occasioned by
war, civil insurrection, certain governmental actions, errors in design,
faulty workmanship or materials (except under certain circumstances), nuclear
reaction, flood (if the mortgaged property is in a federally designated flood
area), chemical contamination and certain other risks.

Restoration of the property with the proceeds described under (i) above
is expected to satisfy the condition under the pool insurance policy that the
property be restored before a claim under such pool insurance policy may be
validly presented with respect to the defaulted Loan secured by such
property. The payment described under (ii) above will render unnecessary
presentation of a claim in respect of such Loan under the pool insurance
policy. Therefore, so long as the pool insurance policy remains in effect,
the payment by the special hazard insurer of the cost of repair or of the
unpaid principal balance of the related Loan plus accrued interest and
certain expenses will not affect the total insurance proceeds paid to holders
of the Certificates, but will affect the relative amounts of coverage
remaining under the special hazard insurance policy and pool insurance
policy.

Other Hazard-Related Insurance; Liability Insurance. With respect to
Loans secured by Multifamily Property, certain additional insurance policies
may be required with respect to the Multifamily Property; for example,
general liability insurance for bodily injury or death and property damage
occurring on the property or the adjoining streets and sidewalks, steam
boiler coverage where a steam boiler or other pressure vessel is in
operation, interest coverage insurance, and rent loss insurance to cover
operating income losses following damage or destruction of the mortgaged
property. With respect to a Series for which Loans secured by Multifamily
Property are included in the Trust Fund, the related Prospectus Supplement
will specify the required types and amounts of additional insurance and
describe the general terms of such insurance and conditions to payment
thereunder.

Bankruptcy Bond

In the event of a bankruptcy of a borrower, the bankruptcy court may
establish the value of the property securing the related Loan at an amount
less than the then outstanding principal balance of such Loan. The amount of
the secured debt could be reduced to such value, and the holder of such Loan
thus would become an unsecured creditor to the extent the outstanding
principal balance of such Loan exceeds the value so assigned to the property
by the bankruptcy court. In addition, certain other modifications of the
terms of a Loan can result from a bankruptcy proceeding. See "CERTAIN LEGAL
ASPECTS OF LOANS" herein. If so provided in the related Prospectus
Supplement, the Master Servicer will obtain a bankruptcy bond or similar
insurance contract (the "bankruptcy bond") for proceedings with respect to
borrowers under the Bankruptcy Code. The bankruptcy bond will cover certain
losses resulting from a reduction by a bankruptcy court of scheduled payments
of principal of and interest on a Loan or a reduction by such court of the
principal amount of a Loan and will cover certain unpaid interest on the
amount of such a principal reduction from the date of the filing of a
bankruptcy petition.

The bankruptcy bond will provide coverage in the aggregate amount
specified in the related Prospectus Supplement for all Loans in the Pool
secured by single unit primary residences. Such amount will be reduced by
payments made under such bankruptcy bond in respect of such Loans, unless
otherwise specified in the related Prospectus Supplement, and will not be
restored.

Repurchase Bond

If so specified in the related Prospectus Supplement, the Depositor or
Master Servicer will be obligated to repurchase any Loan (up to an aggregate
dollar amount specified in the related Prospectus Supplement) for which
insurance coverage is denied due to dishonesty, misrepresentation or fraud in
connection with the origination or sale of such Loan. Such obligation may be
secured by a surety bond guaranteeing payment of the amount to be paid by the
Depositor or the Master Servicer.

THE TRUST AGREEMENTS

The following summaries describe certain provisions of the Trust
Agreements. The summaries do not purport to be complete and are subject to,
and qualified in their entirety by reference to, the provisions of the Trust
Agreements. Where particular provisions or terms used in the Trust Agreements
are referred to, such provisions or terms are as specified in the Trust
Agreements.

Assignment of Primary Assets

General. The Depositor will transfer, convey and assign to the Trustee
all right, title and interest of the Depositor in the Primary Assets and
other property to be included in the Trust Fund for a Series. Such assignment
will include all principal and interest due on or with respect to the Primary
Assets after the Cut-off Date specified in the related Prospectus Supplement
(except for any Retained Interests). The Trustee will, concurrently with such
assignment, execute and deliver the Certificates.

Assignment of Private Mortgage-Backed Securities. The Depositor will
cause Private Mortgage- Backed Securities to be registered in the name of the
Trustee (or its nominee or correspondent). The Trustee (or its agent or
correspondent) will have possession of any certificated Private Mortgage-
Backed Securities. Unless otherwise specified in the related Prospectus
Supplement, the Trustee will not be in possession of or be assignee of record
of any underlying assets for a Private Mortgage-Backed Security. See "THE
TRUST FUNDS--Private Mortgage-Backed Securities" herein. Each Private
Mortgage-Backed Security will be identified in a schedule appearing as an
exhibit to the related Trust Agreement (the "Mortgage Certificate Schedule"),
which will specify the original principal amount, outstanding principal
balance as of the Cut-off Date, annual pass-through rate or interest rate and
maturity date for each Private Mortgage-Backed Security conveyed to the
Trustee. In the Trust Agreement, the Depositor will represent and warrant to
the Trustee regarding the Private Mortgage-Backed Securities: (i) that the
information contained in the Mortgage Certificate Schedule is true and
correct in all material respects; (ii) that, immediately prior to the
conveyance of the Private Mortgage-Backed Securities, the Depositor had good
title thereto, and was the sole owner thereof, (subject to any Retained
Interests); (iii) that there has been no other sale by it of such Private
Mortgage-Backed Securities and (iv) that there is no existing lien, charge,
security interest or other encumbrance (other than any Retained Interest) on
such Private Mortgage-Backed Securities.

Assignment of Mortgage Loans. In addition, the Depositor will, as to
each Mortgage Loan, deliver or cause to be delivered to the Trustee, or, as
specified in the related Prospectus Supplement, the Custodian, the Mortgage
Note endorsed without recourse to the order of the Trustee or in blank, the
original Mortgage with evidence of recording indicated thereon (except for
any Mortgage not returned from the public recording office, in which case a
copy of such Mortgage will be delivered, together with a certificate that the
original of such Mortgage was delivered to such recording office) and an
assignment of the Mortgage in recordable form. The Trustee, or, if so
specified in the related Prospectus Supplement, the Custodian, will hold such
documents in trust for the benefit of the Certificateholders.

If so specified in the related Prospectus Supplement, the Depositor
will, at the time of delivery of the Certificates, cause assignments to the
Trustee of the Mortgage Loans to be recorded in the appropriate public office
for real property records, except in states where, in the opinion of counsel
acceptable to the Trustee, such recording is not required to protect the
Trustee's interest in the Mortgage Loan. If specified in the related
Prospectus Supplement, the Depositor will cause such assignments to be so
recorded within the time after delivery of the Certificates as is specified
in the related Prospectus Supplement, in which event, the Trust Agreement
may, as specified in the related Prospectus Supplement, require the Depositor
to repurchase from the Trustee any Mortgage Loan required to be recorded but
not recorded within such time, at the price described below with respect to
repurchase by reason of defective documentation. Unless otherwise provided in
the related Prospectus Supplement, the enforcement of the repurchase
obligation would constitute the sole remedy available to the
Certificateholders or the Trustee for the failure of a Mortgage Loan to be
recorded.

With respect to any Mortgage Loans which are Cooperative Loans, the
Depositor will cause to be delivered to the Trustee, its agent, or a
custodian, the related original cooperative note endorsed to the order of the
Trustee, the original security agreement, the proprietary lease or occupancy
agreement, the recognition agreement, an executed financing agreement and the
relevant stock certificate and related blank stock powers. The Depositor will
file in the appropriate office an assignment and a financing statement
evidencing the Trustee's security interest in each Cooperative Loan.

The Trustee, its agent, or a custodian will review the documents
relating to each Mortgage Loan within the time period specified in the
related Trust Agreement after receipt thereof, and the Trustee will hold such
documents in trust for the benefit of the Certificateholders. Unless
otherwise specified in the related Prospectus Supplement, if any such
document is found to be missing or defective in any material respect, the
Trustee (or such custodian) will notify the Master Servicer and the
Depositor, and the Master Servicer will notify the party (the "Seller") from
which the Depositor, or an affiliate thereof, purchased such Mortgage Loan.
If the Seller cannot cure the omission or defect within the time period
specified in the related Trust Agreement after receipt of such notice, the
Seller will be obligated to purchase the related Mortgage Loan from the
Trustee at the Purchase Price or, if specified in the related Prospectus
Supplement, replace such Mortgage Loan with another mortgage loan that meets
certain requirements set forth therein. There can be no assurance that a
Seller will fulfill this purchase obligation. Although the Master Servicer
may be obligated to enforce such obligation to the extent described above
under "Mortgage Loan Program--Representations by Sellers; Repurchases,"
neither the Master Servicer nor the Depositor will be obligated to purchase
such Mortgage Loan if the Seller defaults on its purchase obligation, unless
such breach also constitutes a breach of the representations or warranties of
the Master Servicer or the Depositor, as the case may be. Unless otherwise
specified in the related Prospectus Supplement, this purchase obligation
constitutes the sole remedy available to the Certificateholders or the
Trustee for omission of, or a material defect in, any document.

Notwithstanding the foregoing provisions, with respect to a Trust Fund
for which a REMIC or a FASIT election is to be made, unless the related
Prospectus Supplement otherwise provides, no purchase of a Mortgage Loan will
be made if such purchase would result in a prohibited transaction under the
Code.

The Trustee will be authorized to appoint a custodian to maintain
possession of and, if applicable, to review the documents relating to the
Mortgage Loans as agent of the Trustee.

Each Mortgage Loan will be identified in a schedule appearing as an
exhibit to the Trust Agreement (the "Mortgage Loan Schedule"). Such Mortgage
Loan Schedule will specify the number of Mortgage Loans which are Cooperative
Loans and, with respect to each Mortgage Loan: the original principal amount
and unpaid principal balance as of the Cut-off Date; the current interest
rate; the current Scheduled Payment of principal and interest; the maturity
date of the related mortgage note; if the Mortgage Loan is an ARM, the
Lifetime Mortgage Rate Cap, if any, and the current Index; and, if the
Mortgage Loan is a GPM Loan, a GEM Loan, a Buy-Down Loan or a Mortgage Loan
with other than fixed Scheduled Payments and level amortization, the terms
thereof.

Assignment of Manufactured Home Loans. The Depositor will cause any
Manufactured Home Loans included in the Primary Assets for a Series of
Certificates to be assigned to the Trustee, together with principal and
interest due on or with respect to the Manufactured Home Loans after the Cut-
off Date specified in the related Prospectus Supplement. Each Manufactured
Home Loan will be identified in a loan schedule (the "Manufactured Home Loan
Schedule") appearing as an exhibit to the related Trust Agreement. Such
Manufactured Home Loan Schedule will specify, with respect to each
Manufactured Home Loan, among other things: the original principal balance
and the outstanding principal balance as of the close of business on the Cut-
off Date; the interest rate; the current scheduled Payment of principal and
interest; and the maturity date of the Manufactured Home Loan.

In addition, with respect to each Manufactured Home Loan, the Depositor
will deliver or cause to be delivered to the Trustee, or, as specified in the
related Prospectus Supplement, the custodian, the original Manufactured Home
Loan agreement and copies of documents and instruments related to each
Manufactured Home Loan and the security interest in the Manufactured Home
securing each Manufactured Home Loan. To give notice of the right, title and
interest of the Certificateholders to the Manufactured Home Loans, the
Depositor will cause a UCC-1 financing statement to be filed identifying the
Trustee as the secured party and identifying all Manufactured Home Loans as
collateral. Unless otherwise specified in the related Prospectus Supplement,
the Manufactured Home Loans agreements will not be stamped or otherwise
marked to reflect their assignment from the Depositor to the Trustee.
Therefore, if a subsequent purchaser were able to take physical possession of
the Manufactured Home Loans agreements without notice of such assignment, the
interest of the Certificateholders in the Manufactured Home Loans could be
defeated. See "CERTAIN LEGAL ASPECTS OF LOANS--Manufactured Home Loans."

The Depositor will provide limited representations and warranties to the
Trustee concerning the Manufactured Home Loans. Such representations and
warranties will include: (i) that the information contained in the
Manufactured Home Loan Schedule provides an accurate listing of the
Manufactured Home Loans and that the information respecting such Manufactured
Home Loans set forth in such Manufactured Home Loan Schedule is true and
correct in all material respects at the date or dates respecting which such
information is furnished; (ii) that, immediately prior to the conveyance of
the Manufactured Home Loans, the Depositor had good title to, and was sole
owner of, each such Manufactured Home Loan (subject to any Retained
Interests); (iii) that there has been no other sale by it of such
Manufactured Home Loans and that the Manufactured Home Loan is not subject to
any lien, charge, security interest or other encumbrance; (iv) if the Master
Servicer will not directly service the Manufactured Home Loans, each
Servicing Agreement entered into with a Servicer with respect to Manufactured
Home Loans comprising the Primary Assets has been assigned and conveyed to
the Trustee and is not subject to any offset, counterclaim, encumbrance or
other charge; and (v) the Depositor has obtained from the Master Servicer,
the Servicer, the originator of the Manufactured Home Loans or such other
entity that is the seller of the Manufactured Home Loans, representations and
warranties relating to certain information respecting the origination of and
current status of the Manufactured Home Loans, and has no knowledge of any
fact which would cause it to believe that such representations and warranties
are inaccurate in any material respect. See "LOAN UNDERWRITING PROCEDURES AND
STANDARDS" herein.

Assignment of Participation Certificates. The Depositor will cause any
Participation Certificates obtained under a participation agreement to be
assigned to the Trustee by delivering to the Trustee such Participation
Certificates, which will be reregistered in the name of the Trustee. Unless
otherwise specified in the related Prospectus Supplement, the Trustee will
not be in possession of or be assignee of record with respect to the Loans
represented by any Participation Certificate. Each Participation Certificate
will be identified in a "Participation Certificate Schedule" which will
specify the original principal balance, outstanding principal balance as of
the Cut-off Date, pass-through rate and maturity date for each Participation
Certificate. In the Trust Agreement, the Depositor will represent and warrant
to the Trustee regarding each Participation Certificate: (i) that the
information contained in the Participation Certificate Schedule is true and
correct in all material respects; (ii) that, immediately prior to the
conveyance of the Participation Certificates, the Depositor had good title to
and was sole owner of such Participation Certificates; (iii) that there has
been no other sale by it of such Participation Certificates and (iv) that
such Participation Certificates are not subject to any existing lien, charge,
security interest or other encumbrance (other than any Retained Interests).

Repurchase and Substitution of Non-Conforming Loans

Unless otherwise provided in the related Prospectus Supplement, if any
document in the Loan file delivered by the Depositor to the Trustee is found
by the Trustee within 45 days of the execution of the related Trust
Agreement, or such other time period as is specified in the Prospectus
Supplement for the related Series, (or promptly after the Trustee's receipt
of any document permitted to be delivered after the Closing Date) to be
defective in any material respect and the Depositor does not cure such defect
within 90 days, or such other period as is specified in the related
Prospectus Supplement, the Depositor will, not later than 90 days, or such
other period as is specified in the related Prospectus Supplement, after the
Trustee's notice to the Depositor or the Master Servicer, as the case may be,
of the defect, repurchase the related Mortgage Loan or any property acquired
in respect thereof from the Trustee at a price equal to (a) the lesser of (i)
the outstanding principal balance of such Mortgage Loan (or, in the case of a
foreclosed Mortgage Loan, the outstanding principal balance of such Mortgage
Loan immediately prior to foreclosure) and (ii) the Trust Fund's federal
income tax basis in the Mortgage Loan, and (b), accrued and unpaid interest
to the date of the next scheduled payment on such Mortgage Loan at the
related Pass-Through Rate or Certificate Interest Rate (less any unreimbursed
Advances respecting such Mortgage Loan), provided, however, the purchase
price shall not be limited in (i) above to the Trust Fund's federal income
tax basis if the repurchase at a price equal to the outstanding principal
balance of such Mortgage Loan will not result in any prohibited transaction
tax under Section 860F(a) of the Code.

If provided in the related Prospectus Supplement, the Depositor may,
rather than repurchase the Loan as described above, remove such Loan from the
Trust Fund (the "Deleted Loan") and substitute in its place one or more other
Loans (each, a "Qualifying Substitute Mortgage Loan") provided, however, that
(i) with respect to a Trust Fund for which no REMIC election is made, such
substitution must be effected within 120 days of the date of initial issuance
of the Certificates and (ii) with respect to a Trust Fund for which a REMIC
election is made, such substitution must be made within two years of such
date.

Any Qualifying Substitute Mortgage Loan will have, on the date of
substitution, (i) an outstanding principal balance, after deduction of all
Scheduled Payments due in the month of substitution, not in excess of the
outstanding principal balance of the Deleted Loan (the amount of any
shortfall to be deposited to the Certificate Account in the month of
substitution for distribution to Certificateholders), (ii) an interest rate
not less than (and not more than 2% greater than) the interest rate of the
Deleted Loan, (iii) a remaining term-to-stated maturity not greater than (and
not more than two years less than) that of the Deleted Loan, and will comply
with all of the representations and warranties set forth in the applicable
agreement as of the date of substitution.

Unless otherwise provided in the related Prospectus Supplement, the
above-described cure, repurchase or substitution obligations constitute the
sole remedies available to the Certificateholders or the Trustee for a
material defect in a Loan document.

The Depositor or another entity will make representations and warranties
with respect to Loans which comprise the Primary Assets for a Series. See
"LOAN UNDERWRITING PROCEDURES AND STANDARDS--Representations and Warranties"
above. If the Depositor or such entity cannot cure a breach of any such
representations and warranties in all material respects within 90 days after
notification by the Trustee of such breach, and if such breach is of a nature
that materially and adversely affects the value of such Loan, the Depositor
or such entity is obligated to repurchase the affected Loan or, if provided
in the related Prospectus Supplement, provide a Qualifying Substitute
Mortgage Loan therefor, subject to the same conditions and limitations on
purchases and substitutions as described above.

The Depositor's only source of funds to effect any cure, repurchase or
substitution will be through the enforcement of the corresponding obligations
of the responsible originator or seller of such Loans. See "SPECIAL
CONSIDERATIONS".

Reports To Certificateholders

The Trustee will prepare and forward to each Certificateholder on each
Distribution Date, or as soon thereafter as is practicable, a statement
setting forth, to the extent applicable to any Series, among other things:

(i) (A) with respect to a Series other than a Multi-Class Series,
the amount of such distribution allocable to principal on the Primary
Assets, separately identifying the aggregate amount of any principal
prepayments included therein and the amount, if any, advanced by the
Master Servicer or by a Servicer or (B) with respect to a Multi-Class
Series, the amount of the principal distribution in reduction of stated
principal amount (or Compound Value) of each Class and the aggregate
unpaid principal amount (or Compound Value) of each Class following such
distribution;

(ii) (A) with respect to a Series other than a Multi-Class Series,
the amount of such distribution allocable to interest on the Primary
Assets and the amount, if any, advanced by the Master Servicer or a
Servicer or (B) with respect to a Multi-Class Series, the amount of the
interest distribution;

(iii) the amount of servicing compensation with respect to the
Principal Assets and paid during the Due Period commencing on the Due
Date to which such distribution relates and the amount of servicing
compensation during such period attributable to penalties and fees;

(iv) the aggregate outstanding principal balance of the Principal
Assets as of the opening of business on the Due Date, after giving
effect to distributions allocated to principal and reported under (i)
above;

(v) the aggregate outstanding principal amount of the Certificates
of such series as of the Due Date, after giving effect to distributions
allocated to principal reported under (i) above;

(vi) with respect to Compound Interest Certificates, prior to the
Accrual Termination Date in addition to the information specified in
(i)(B) above, the amount of interest accrued on such Certificates during
the related Interest Accrual Period and added to the Compound Value
thereof;

(vii) in the case of Floating Rate Certificates, the Floating Rate
applicable to the distribution being made;

(viii) if applicable, the amount of any shortfall (i.e., the
difference between the aggregate amounts of principal and interest which
Certificateholders would have received if there were sufficient eligible
funds in the Certificate Account and the amounts actually distributed);

(ix) if applicable, the number and aggregate principal balances of
Loans delinquent for (A) two consecutive payments and (B) three or more
consecutive payments, as of the close of the business on the
Determination Date to which such distribution relates;

(x) if applicable, the book value of any REO Property acquired on
behalf of Certificateholders through foreclosure, grant of a deed in
lieu of foreclosure or repossession as of the close of the business on
the Business Day preceding the Distribution Date to which such
distribution relates;

(xi) the amount of any withdrawal from any applicable reserve fund
included in amounts actually distributed to Certificateholders and the
remaining balance of each reserve fund (including any Subordinated
Reserve Fund), if any, on such Distribution Date, after giving effect to
distributions made on such date; and

(xii) such other information as specified in the related Trust
Agreement.

In addition, within a reasonable period of time after the end of each
calendar year the Trustee, unless otherwise specified in the related
Prospectus Supplement, will furnish to each Certificateholder of record at
any time during such calendar year: (a) the aggregate of amounts reported
pursuant to (i) through (iv), (vi), (viii) and (xvi) above for such calendar
year and (b) such information specified in the Trust Agreement to enable
Certificateholders to prepare their tax returns including, without
limitation, the amount of original issue discount accrued on the
Certificates, if applicable. Information in the Distribution Date and annual
reports provided to the Certificateholders will not have been examined and
reported upon by an independent public accountant. However, the Master
Servicer will provide to the Trustee a report by independent public
accountants with respect to the Master Servicer's servicing of the Loans. See
"SERVICING OF LOANS--Evidence as to Compliance" herein.

Investment of Funds

The Certificate Account, Collection Account or Custodial Account, if
any, and any other funds and accounts for a Series that may be invested by
the Trustee or by the Master Servicer (or by the Servicer, if any), can be
invested only in Eligible Investments acceptable to each Rating Agency, which
may include, without limitation, (i) direct obligations of, and obligations
fully guaranteed as to timely payment of principal and interest by, the
United States of America, FHLMC, FNMA or any agency or instrumentality of the
United States of America, the obligations of which are backed by the full
faith and credit of the United States of America, (ii) demand and time
deposits, certificates of deposit or bankers' acceptances, (iii) repurchase
obligations pursuant to a written agreement with respect to any security
described in clause (i) above, (iv) securities bearing interest or sold at a
discount issued by any corporation incorporated under the laws of the United
States of America or any state, (v) commercial paper (including both non-
interest-bearing discount obligations and interest-bearing obligations
payable on demand or on a specified date not more than one year after the
date of issuance thereof), (vi) a Guaranteed Investment Contract issued by an
entity having a credit rating acceptable to each Rating Agency and (vii) any
other demand, money market or time deposit or obligation, security or
investment as would not adversely affect the then current rating by the
Rating Agencies.

Funds held in a reserve fund or Subordinated Reserve Fund may be
invested in certain Eligible Reserve Fund Investments which may include
Eligible Investments, mortgage loans, mortgage pass-through or participation
securities, mortgage-backed bonds or notes or other investments to the extent
specified in the related Prospectus Supplement.

Eligible Investments or Eligible Reserve Fund Investments with respect
to a Series will include only obligations or securities that mature on or
before the date on which the amounts in the Collection Account are required
to be remitted to the Trustee and amounts in the Certificate Account, any
Reserve Fund or the Subordinated Reserve Fund for such Series are required or
may be anticipated to be required to be applied for the benefit of
Certificateholders of such Series.

If so provided in the related Prospectus Supplement, the reinvestment
income from the Subordination Reserve Fund, other Reserve Fund, Servicer
Account, Collection Account or the Certificate Account may be property of the
Master Servicer or a Servicer and not available for distributions to
Certificateholders. See "SERVICING OF LOANS" herein.

Event of Default

Events of Default under the Trust Agreement for each Series include (i)
any failure by the Master Servicer or Servicer to distribute or remit any
required payment which continues unremedied for five business days (or such
shorter period as is specified in the applicable agreement) after the giving
of written notice of such failure to the Master Servicer or Servicer by the
Trustee for such Series, or to the Master Servicer or Servicer and the
Trustee by the Holders of Certificates of such Series evidencing not less
than 25% of the aggregate outstanding principal amount of the Certificates
for such Series, (ii) any failure by the Master Servicer or Servicer duly to
observe or perform in any material respect any other of its covenants or
agreements in the Trust Agreement which continues unremedied for 30 days
after the giving of written notice of such failure to the Master Servicer or
Servicer by the Trustee, or to the Master Servicer or Servicer and the
Trustee by the Holders of Certificates of such Series evidencing not less
than 25% of the aggregate outstanding principal amount of the Certificates
and (iii) certain events in insolvency, readjustment of debt, marshalling of
assets and liabilities or similar proceedings and certain actions by the
Master Servicer or Servicer indicating its insolvency, reorganization or
inability to pay its obligations.

Rights Upon Event of Default

So long as an Event of Default remains unremedied under the Trust
Agreement for a Series, the Trustee for such Series or Holders of
Certificates of such Series evidencing not less than 25% of the aggregate
outstanding principal amount of the Certificates for such Series may
terminate all of the rights and obligations of the Master Servicer as
servicer under the Trust Agreement and in and to the Mortgage Loans (other
than its right to recovery of other expenses and amounts advanced pursuant to
the terms of the Trust Agreement which rights the Master Servicer will retain
under all circumstances), whereupon the Trustee will succeed to all the
responsibilities, duties and liabilities of the Master Servicer under the
Trust Agreement and will be entitled to reasonable servicing compensation not
to exceed the applicable servicing fee, together with other servicing
compensation in the form of assumption fees, late payment charges or
otherwise as provided in the Trust Agreement.

In the event that the Trustee is unwilling or unable so to act, it may
select, or petition a court of competent jurisdiction to appoint, a housing
and home finance institution, bank or mortgage servicing institution with a
net worth of at least $15,000,000 to act as successor Master Servicer under
the provisions of such Trust Agreement relating to the servicing of the
Mortgage Loans. The successor Master Servicer would be entitled to reasonable
servicing compensation in an amount not to exceed the Servicing Fee as set
forth in the related Prospectus Supplement, together with the other servicing
compensation in the form of assumption fees, late payment charges or
otherwise, as provided in the Trust Agreement.

During the continuance of any Event of Default under the Trust Agreement
for a Series, the Trustee for such Series will have the right to take action
to enforce its rights and remedies and to protect and enforce the rights and
remedies of the Certificateholders of such Series, and Holders of
Certificates evidencing not less than 25% of the aggregate outstanding
principal amount of the Certificates for such Series may direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred upon that Trustee.
However, the Trustee will not be under any obligation to pursue any such
remedy or to exercise any of such trusts or powers unless such
Certificateholders have offered the Trustee reasonable security or indemnity
against the cost, expenses and liabilities which may be incurred by the
Trustee therein or thereby. Also, the Trustee may decline to follow any such
direction if the Trustee determines that the action or proceeding so directed
may not lawfully be taken or would involve it in personal liability or be
unjustly prejudicial to the non- assenting Certificateholders.

No Certificateholder of a Series, solely by virtue of such Holder's
status as a Certificateholder, will have any right under the Trust Agreement
for such Series to institute any proceeding with respect to the Trust
Agreement, unless such Holder previously has given to the Trustee for such
Series written notice of default and unless the Holders of Certificates
evidencing not less than 25% of the aggregate outstanding principal amount of
the Certificates for such Series have made written request upon the Trustee
to institute such proceeding in its own name as Trustee thereunder and have
offered to the Trustee reasonable indemnity, and the Trustee for 60 days has
neglected or refused to institute any such proceeding.

The Trustee

The identity of the commercial bank, savings and loan association or
trust company named as the Trustee for each Series of Certificates will be
set forth in the related Prospectus Supplement. The entity serving as Trustee
may have normal banking relationships with the Depositor or the Master
Servicer. In addition, for the purpose of meeting the legal requirements of
certain local jurisdictions, the Trustee will have the power to appoint co-
trustees or separate trustees of all or any part of the Trust Fund relating
to a Series of Certificates. In the event of such appointment, all rights,
powers, duties and obligations conferred or imposed upon the Trustee by the
Trust Agreement relating to such Series will be conferred or imposed upon the
Trustee and each such separate trustee or co-trustee jointly, or, in any
jurisdiction in which the Trustee shall be incompetent or unqualified to
perform certain acts, singly upon such separate trustee or co-trustee who
shall exercise and perform such rights, powers, duties and obligations solely
at the direction of the Trustee. The Trustee may also appoint agents to
perform any of the responsibilities of the Trustee, which agents shall have
any or all of the rights, powers, duties and obligations of the Trustee
conferred on them by such appointment; provided that the Trustee shall
continue to be responsible for its duties and obligations under the Trust
Agreement.

Duties of the Trustee

The Trustee makes no representations as to the validity or sufficiency
of the Trust Agreement, the Certificates or of any Primary Asset or related
documents. If no Event of Default (as defined in the related Trust Agreement)
has occurred, the Trustee is required to perform only those duties
specifically required of it under the Trust Agreement. Upon receipt of the
various certificates, statements, reports or other instruments required to be
furnished to it, the Trustee is required to examine them to determine whether
they are in the form required by the related Trust Agreement, however, the
Trustee will not be responsible for the accuracy or content of any such
documents furnished by it or the Certificateholders to the Master Servicer
under the Trust Agreement.

The Trustee may be held liable for its own negligent action or failure
to act, or for its own willful misconduct; provided, however, that the
Trustee will not be personally liable with respect to any action taken,
suffered or omitted to be taken by it in good faith in accordance with the
direction of the Certificateholders in an Event of Default, see "Rights Upon
Event of Default" above. The Trustee is not required to expend or risk its
own funds or otherwise incur any financial liability in the performance of
any of its duties under a Trust Agreement, or in the exercise of any of its
rights or powers, if it has reasonable grounds for believing that repayment
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it.

Resignation of Trustee

The Trustee may, upon written notice to the Depositor, resign at any
time, in which event the Depositor will be obligated to use its best efforts
to appoint a successor Trustee. If no successor Trustee has been appointed
and has accepted the appointment within 30 days after giving such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for appointment of a successor Trustee. The Trustee may also be
removed at any time (i) by the Depositor, if the Trustee ceases to be
eligible to continue as such under the Trust Agreement, (ii) if the Trustee
becomes insolvent, (iii) if a tax is imposed or threatened with respect to
the Trust Fund by any state in which the Trustee or the Trust Fund held by
the Trustee pursuant to the Trust Agreement is located, or (iv) by the
Holders of Certificates evidencing over 50% of the aggregate outstanding
principal amount of the Certificates in the Trust Fund upon 30 days' advance
written notice to the Trustee and to the Depositor. Any resignation or
removal of the Trustee and appointment of a successor Trustee will not become
effective until acceptance of the appointment by the successor Trustee.

Certificate Account

The Trustee will establish a separate account (the "Certificate
Account") in its name as Trustee for the Certificateholders. Unless otherwise
specified in the related Prospectus Supplement, the Certificate Account may
be maintained as an interest bearing account or the funds held therein may be
invested, pending disbursement to Certificateholders of the related Series,
pursuant to the terms of the Trust Agreement, in Eligible Investments. If so
specified in the related Prospectus Supplement, the Master Servicer will be
entitled to receive as additional compensation, any interest or other income
earned on funds in the Certificate Account. The Trustee will deposit into the
Certificate Account on the Business Day received all funds received from the
Master Servicer and required withdrawals from any Reserve Funds. Unless
otherwise specified in the related Prospectus Supplement, the Trustee is
permitted from time to time to make withdrawals from the Certificate Account
for each Series to remove amounts deposited therein in error, to pay to the
Master Servicer any reinvestment income on funds held in the Certificate
Account to the extent it is entitled, to remit to the Master Servicer its
Servicing Fee to the extent not previously withdrawn from the Collection
Account, to make deposits to any Reserve Fund, to make regular distributions
to the Certificateholders and to clear and terminate the Certificate Account.

Expense Reserve Fund

If specified in the Prospectus Supplement relating to a Series, the
Depositor may deposit on the related Closing Date in an account to be
established with the Trustee (the "Expense Reserve Fund") cash or eligible
investments which will be available to pay anticipated fees and expenses of
the Trustee or other agents. The Expense Reserve Fund for a Series may also
be funded over time through the deposit therein of all or a portion of cash
flow, to the extent described in the related Prospectus Supplement. The
Expense Reserve Fund, if any, will not be part of the Trust Fund held for the
benefit of the Holders. Amounts on deposit in any Expense Reserve Fund will
be invested in one or more Eligible Investments.

Amendment of Trust Agreement

Unless otherwise specified in the Prospectus Supplement, the Trust
Agreement for each Series of Certificates may be amended by the Depositor,
the Master Servicer, and the Trustee with respect to such Series, without
notice to or consent of the Certificateholders (i) to cure any ambiguity,
(ii) to correct or supplement any provision therein which may be inconsistent
with any other provision therein or in the Prospectus Supplement, (iii) to
make any other provisions with respect to matters or questions arising under
such Trust Agreement or (iv) to comply with any requirements imposed by the
Code; provided that any such amendment pursuant to clause (iii) above will
not adversely affect in any material respect the interests of any
Certificateholders of such Series not consenting thereto. Any such amendment
pursuant to clause (iii) of the preceding sentence shall be deemed not to
adversely affect in any material respect the interests of any
Certificateholder if the Trustee receives written confirmation from each
Rating Agency rating such Certificates that such amendment will not cause
such Rating Agency to reduce the then current rating thereof. The Trust
Agreement for each Series may also be amended by the Trustee, the Master
Servicer and the Depositor with respect to such Series with the consent of
the Holders possessing not less than 66 2/3% of the aggregate outstanding
principal amount of the Certificates of each Class of such Series affected
thereby, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of such Trust Agreement or
modifying in any manner the rights of Certificateholders of such Series;
provided, however, that no such amendment may (a) reduce the amount or delay
the timing of payments on any Certificate without the consent of the Holder
of such Certificate; or (b) reduce the aforesaid percentage of aggregate
outstanding principal amount of Certificates of each Class, the Holders of
which are required to consent to any such amendment without the consent of
the Holders of 100% of the aggregate outstanding principal amount of each
Class of Certificates affected thereby.

Voting Rights

The related Trust Agreement will specify the method of determining
allocation of Voting Rights with respect to a Series.

List of Certificateholders

Upon written request of three or more Certificateholders of record of a
Series for purposes of communicating with other Certificateholders with
respect to their rights under the Trust Agreement or under the Certificates
for such Series, which request is accompanied by a copy of the communication
which such Certificateholders propose to transmit, the Trustee will afford
such Certificateholders access during business hours to the most recent list
of Certificateholders of that Series held by the Trustee.

No Trust Agreement will provide for the holding of any annual or other
meeting of Certificateholders.

REMIC or FASIT Administrator

With respect to any Multi-Class Series, preparation of certain reports
and certain other administrative duties with respect to the Trust Fund may be
performed by a REMIC or a FASIT administrator, who may be an affiliate of the
Depositor.

Termination

The obligations created by the Trust Agreement for a Series will
terminate upon the distribution to Certificateholders of all amounts
distributable to them pursuant to such Trust Agreement after (i) the later of
the final payment or other liquidation of the last Mortgage Loan remaining in
the Trust Fund for such Series or the disposition of all property acquired
upon foreclosure or deed in lieu of foreclosure in respect of any Mortgage
Loan ("REO Property") or (ii) the repurchase, as described below, by the
Master Servicer from the Trustee for such Series of all Mortgage Loans at
that time subject to the Trust Agreement and all REO Property. The Trust
Agreement for each Series permits, but does not require, the Master Servicer
to repurchase from the Trust Fund for such Series all remaining Mortgage
Loans at a price equal to 100% of the Aggregate Asset Principal Balance of
such Mortgage Loans plus, with respect to REO Property, if any, the
outstanding principal balance of the related Mortgage Loan, less, in either
case, related unreimbursed Advances (in the case of the Mortgage Loans, only
to the extent not already reflected in the computation of the Aggregate Asset
Principal Balance of such Mortgage Loans) and unreimbursed expenses (that are
reimbursable pursuant to the terms of the Trust Agreement) plus, in either
case, accrued interest thereon at the weighted average Mortgage Loan Pass-
Through Rate through the last day of the Due Period in which such repurchase
occurs; provided, however, that if an election is made for treatment as a
REMIC or as a FASIT under the Code, the repurchase price may equal the
greater of (a) 100% of the Aggregate Asset Principal Balance of such Mortgage
Loans, plus accrued interest thereon at the applicable Net Mortgage Rates
through the last day of the month of such repurchase and (b) the aggregate
fair market value of such Mortgage Loans; plus the fair market value of any
property acquired in respect of a Mortgage Loan and remaining in the Trust
Fund. The exercise of such right will effect early retirement of the
Certificates of such Series, but the Master Servicer's right to so purchase
is subject to the Aggregate Principal Balance of the Mortgage Loans at the
time of repurchase being less than a fixed percentage, to be set forth in the
related Prospectus Supplement, of the Cut-off Date Aggregate Asset Principal
Balance. In no event, however, will the trust created by the Trust Agreement
continue beyond the expiration of 21 years from the death of the last
survivor of certain person identified therein. For each Series, the Master
Servicer or the Trustee, as applicable, will give written notice of
termination of the Trust Agreement to each Certificateholder, and the final
distribution will be made only upon surrender and cancellation of the
Certificates at an office or agency specified in the notice of termination.
If so provided in the related Prospectus Supplement for a Series, the
Depositor or another entity may effect an optional termination of the Trust
Fund under the circumstances described in such Prospectus Supplement. See
"DESCRIPTION OF THE CERTIFICATES--Optional Termination of the Trust Fund"
herein.

CERTAIN LEGAL ASPECTS OF LOANS

The following discussion contains summaries of certain legal aspects of
housing loans which are general in nature. Because certain of such legal
aspects are governed by applicable state law (which laws may differ
substantially), the summaries do not purport to be complete nor to reflect
the laws of any particular state, nor to encompass the laws of all states in
which the properties securing the housing loans are situated. The summaries
are qualified in their entirety by reference to the applicable federal and
state laws governing the Loans.

Mortgages

The Mortgage Loans comprising or underlying the Primary Assets for a
Series will be secured by either mortgages or deeds of trust or deeds to
secure debt, depending upon the prevailing practice in the state in which the
property subject to a Mortgage Loan is located. The filing of a mortgage,
deed of trust or deed to secure debt creates a lien or title interest upon
the real property covered by such instrument and represents the security for
the repayment of an obligation that is customarily evidenced by a promissory
note. It is not prior to the lien for real estate taxes and assessments or
other charges imposed under governmental police powers. Priority with respect
to such instruments depends on their terms, the knowledge of the parties to
the mortgage and generally on the order of recording with the applicable
state, county or municipal office. There are two parties to a mortgage, the
mortgagor, who is the borrower/homeowner or the land trustee (as described
below), and the mortgagee, who is the lender. Under the mortgage instrument,
the mortgagor delivers to the mortgagee a note or bond and the mortgage. In
the case of a land trust, there are three parties because title to the
property is held by a land trustee under a land trust agreement of which the
borrower/homeowner is the beneficiary; at origination of a mortgage loan, the
borrower executes a separate undertaking to make payments on the mortgage
note. A deed of trust transaction normally has three parties, the trustor,
who is the borrower/homeowner; the beneficiary, who is the lender, and the
trustee, a third-party grantee. Under a deed of trust, the trustor grants the
property, irrevocably until the debt is paid, in trust, generally with a
power of sale, to the trustee to secure payment of the obligation. The
mortgagee's authority under a mortgage and the trustee's authority under a
deed of trust are governed by the law of the state in which the real property
is located, the express provisions of the mortgage or deed of trust, and, in
some cases, in deed of trust transactions, the directions of the beneficiary.

Junior Mortgages; Rights of Senior Mortgages

If specified in the applicable Prospectus Supplement, Mortgage Loans
included in the Mortgage Pool will be secured by junior mortgages or deeds of
trust which are subordinate to senior mortgages or deeds of trust held by
other lenders or institutional investors. The rights of the Trust Fund (and
therefore the Certificateholders) as beneficiary under a junior deed of trust
or as mortgagee under a junior mortgage, are subordinate to those of the
mortgagee or beneficiary under the senior mortgage or deed of trust,
including the prior rights of the senior mortgagee or beneficiary to receive
rents, hazard insurance and condemnation proceeds and to cause the property
securing the Mortgage Loan to be sold upon default of the mortgagor or
trustor, thereby extinguishing the junior mortgagee's or junior beneficiary's
lien unless the Special Servicer asserts its subordinate interest in a
property in foreclosure litigation or satisfies the defaulted senior loan.
As discussed more fully below, in many states a junior mortgagee or
beneficiary may satisfy a defaulted senior loan in full, or may cure such
default and bring the senior loan current, in either event adding the amounts
expended to the balance due on the junior loan. Absent a provision in the
senior mortgage, no notice of default is required to be given to the junior
mortgagee.

The form of the mortgage or deed of trust used by many institutional
lenders confers on the mortgagee or beneficiary the right both to receive all
proceeds collected under any hazard insurance policy and all awards made in
connection with any condemnation proceedings, and to apply such proceeds and
awards to any indebtedness secured by the mortgage or deed of trust, in such
order as the mortgagee or beneficiary may determine. Thus, in the event
improvements on the property are damaged or destroyed by fire or other
casualty, or in the event the property is taken by condemnation, the
mortgagee or beneficiary under the senior mortgage or deed of trust will have
the prior right to collect any insurance proceeds payable under a hazard
insurance policy and any award of damages in connection with the condemnation
and to apply the same to the indebtedness secured by the senior mortgage or
deed of trust. Proceeds in excess of the amount of senior mortgage
indebtedness will, in most cases, be applied to the indebtedness of a junior
mortgage or trust deed. The laws of certain states may limit the ability of
mortgagees or beneficiaries to apply the proceeds of hazard insurance and
partial condemnation awards to the secured indebtedness. In such states, the
mortgagor or trustor must be allowed to use the proceeds of hazard insurance
to repair the damage unless the security of the mortgagee or beneficiary has
been impaired. Similarly, in certain states, the mortgagee or beneficiary is
entitled to the award for a partial condemnation of the real property
security only to the extent that its security is impaired.

The form of mortgage or deed of trust used by many institutional lenders
typically contains a "future advance" clause, which provides, in essence,
that additional amounts advanced to or on behalf of the mortgagor or trustor
by the mortgagee or beneficiary are to be secured by the mortgage or deed of
trust. While such a clause is valid under the laws of most states, the
priority of any advance made under the clause depends, in some states, on
whether the advance was an "obligatory" or "optional" advance. If the
mortgagee or beneficiary is obligated to advance the additional amounts, the
advance may be entitled to receive the same priority as amounts initially
made under the mortgage or deed of trust, notwithstanding that there may be
intervening junior mortgages or deeds of trust and other liens between the
date of recording of the mortgage or deed of trust and the date of the future
advance, and notwithstanding that the mortgagee or beneficiary had actual
knowledge of such intervening junior mortgages or deeds of trust and other
liens at the time of the advance. Where the mortgagee or beneficiary is not
obligated to advance the additional amounts and has actual knowledge of the
intervening junior mortgages or deeds of trust and other liens, the advance
may be subordinate to such intervening junior mortgages or deeds of trust and
other liens. Priority of advances under a "future advance" clause rests, in
many other states, on state law giving priority to all advances made under
the loan agreement up to a "credit limit" amount stated in the recorded
mortgage.

Another provision typically found in the form of the mortgage or deed of
trust used by many institutional lenders obligates the mortgagor or trustor
to pay before delinquency all taxes and assessments on the property and, when
due, all encumbrances, charges and liens on the property which appear prior
to the mortgage or deed of trust, to provide and maintain fire insurance on
the property, to maintain and repair the property and not to commit or permit
any waste thereof, and to appear in and defend any action or proceeding
purporting to affect the property or the rights of the mortgagee or
beneficiary under the mortgage or deed of trust. Upon a failure of the
mortgagor or trustor to perform any of these obligations, the mortgagee or
beneficiary is given the right under the mortgage or deed of trust to perform
the obligation itself, at its election, with the mortgagor or trustor
agreeing to reimburse the mortgagee or beneficiary for any sums expended by
the mortgagee or beneficiary on behalf of the mortgagor or trustor. All sums
so expended by the mortgagee or beneficiary become part of the indebtedness
secured by the mortgage or deed of trust.

The form of mortgage or deed of trust used by many institutional lenders
typically requires the mortgagor or trustor to obtain the consent of the
mortgagee or beneficiary in respect of actions affecting the mortgaged
property, including, without limitation, leasing activities (including new
leases and termination or modification of existing leases), alterations and
improvements to buildings forming a part of the mortgaged property and
management and leasing agreements for the mortgaged property. Tenants will
often refuse to execute a lease unless the mortgagee or beneficiary executes
a written agreement with the tenant not to disturb the tenant's possession of
its premises in the event of a foreclosure. A senior mortgagee or
beneficiary may refuse to consent to matters approved by a junior mortgagee
or beneficiary with the result that the value of the security for the junior
mortgage or deed of trust is diminished. For example, a senior mortgagee or
beneficiary may decide not to approve a lease or to refuse to grant a tenant
a non-disturbance agreement. If, as a result, the lease is not executed, the
value of the mortgaged property may be diminished.

Cooperative Loans

If specified in the Prospectus Supplement relating to a Series of
Certificates, the Mortgage Loans may also contain Cooperative Loans evidenced
by promissory notes secured by security interests in shares issued by private
corporations which are entitled to be treated as housing cooperatives under
the Code and in the related proprietary leases or occupancy agreements
granting exclusive rights to occupy specific dwelling units in the
corporations' buildings. The security agreement will create a lien upon, or
grant a title interest in, the property which it covers, the priority of
which will depend on the terms of the particular security agreement as well
as the order of recordation of the agreement in the appropriate recording
office. Such a lien or title interest is not prior to the lien for real
estate taxes and assessments and other charges imposed under governmental
police powers.

Cooperative Loans are not secured by liens on real estate. The "owner"
of a cooperative apartment does not own the real estate constituting the
apartment, but owns shares of stock in a corporation which holds title to the
building in which the apartment is located, and by virtue of owning such
stock is entitled to a proprietary lease or occupancy agreement to occupy the
specific apartment. A Cooperative Loan is a loan secured by a lien on the
shares and an assignment of the lease or occupancy agreement. If the
borrower defaults on a Cooperative Loan, the lender's remedies are similar to
the remedies which apply to a foreclosure of a leasehold mortgage or deed of
trust, in that the lender can foreclose the loan and assume ownership of the
shares and of the borrower's rights as lessee under the related proprietary
lease or occupancy agreement. Typically, the lender and the cooperative
housing corporation enter into a recognition agreement that establishes the
rights and obligations of both parties in the event of a default by the
borrower on its obligations under the lease or occupancy agreement.

A corporation which is entitled to be treated as a housing cooperative
under the Code owns all the real property or some interest therein sufficient
to permit it to own the building and all separate dwelling units therein. The
Cooperative is directly responsible for property management and, in most
cases, payment of real estate taxes and hazard and liability insurance. If
there is a blanket mortgage or mortgages on the cooperative apartment
building and/or underlying land, as is generally the case, or an underlying
lease of the land, as is the case in some instances, the Cooperative, as
property mortgagor, is also responsible for meeting these mortgage and rental
obligations. The interest of the occupant under proprietary leases or
occupancy agreements as to which that Cooperative is the landlord are
generally subordinate to the interest of the holder of a blanket mortgage and
to the interest of the holder of a land lease. If the Cooperative is unable
to meet the payment obligations (i) arising under a blanket mortgage, the
mortgagee holding a blanket mortgage could foreclose on that mortgage and
terminate all subordinate proprietary leases and occupancy agreements or (ii)
arising under its land lease, the holder of the land lease could terminate it
and all subordinate proprietary leases and occupancy agreements. Also, a
blanket mortgage on a Cooperative may provide financing in the form of a
mortgage that does not fully amortize, with a significant portion of
principal being due in one final payment at maturity. The inability of the
Cooperative to refinance a mortgage and its consequent inability to make such
final payment could lead to foreclosure by the mortgagee. Similarly, a land
lease has an expiration date and the inability of the Cooperative to extend
its term or, in the alternative, to purchase the land could lead to
termination of the Cooperative's interest in the property and termination of
all proprietary leases and occupancy agreements. A foreclosure by the holder
of a blanket mortgage could eliminate or significantly diminish the value of
any collateral held by the lender who financed an individual tenant-
stockholder of Cooperative shares or, in the case of the Mortgage Loans, the
collateral securing the Cooperative Loans. Similarly, the termination of the
land lease by its holder could eliminate or significantly diminish the value
of any collateral held by the lender who financed an individual tenant-
stockholder of the Cooperative shares or, in the case of the Mortgage Loans,
the collateral securing the Cooperative Loans.

The Cooperative is owned by tenant-stockholders who, through ownership
of stock or shares in the corporation, receive proprietary leases or
occupancy agreements which confer exclusive rights to occupy specific units.
Generally, a tenant-stockholder of a Cooperative must make a monthly payment
to the Cooperative representing such tenant-stockholder's pro rata share of
the Cooperative's payments for its blanket mortgage, real property taxes,
maintenance expenses and other capital or ordinary expenses. An ownership
interest in a Cooperative and accompanying occupancy rights are financed
through a Cooperative share loan evidenced by a promissory note and secured
by a security interest in the occupancy agreement or proprietary lease and in
the related Cooperative shares. The lender takes possession of the share
certificate and a counterpart of the proprietary lease or occupancy agreement
and a financing statement covering the proprietary lease or occupancy
agreement and the Cooperative shares is filed in the appropriate state and
local offices to perfect the lender's interest in its collateral. Subject to
the limitations discussed below, upon default of the tenant-stockholder, the
lender may sue for judgment on the promissory note, dispose of the collateral
at a public or private sale or otherwise proceed against the collateral or
tenant-stockholder as an individual as provided in the security agreement
covering the assignment of the proprietary lease or occupancy agreement and
the pledge of cooperative shares. See "Realizing on Cooperative Loan
Security" below.

There are certain risks that arise as a result of the cooperative form
of ownership which differentiate Cooperative Loans from other types of
Mortgage Loans. For example, the power of the board of directors of most
cooperative housing corporations to reject a proposed purchaser of a unit
owner's shares (and prevent the sale of an apartment) for any reason (other
than reasons based upon unlawful discrimination), or for no reason,
significantly reduces the universe of potential purchasers in the event of a
foreclosure. Moreover, in buildings where the "sponsor" (i.e., the owner of
the unsold shares in the corporation) holds a significant number of unsold
interests in apartments, cooperative apartment owners run a special risk that
the sponsor may go into default on its proprietary leases or occupancy
agreements, and thereby cause a default under the underlying mortgage loan to
the cooperative housing corporation which is secured by a mortgage on the
building. In such event, the unit owners may be forced to make up any
shortfall in income to the cooperative housing corporation resulting from the
sponsor's default or risk losing their apartments in a foreclosure proceeding
brought by the holder of the mortgage on the building. Not only would the
value attributable to the right to occupy a particular apartment be adversely
affected by such an occurrence, but the foreclosure of a mortgage on the
building in which the apartment is located could result in a total loss of
the shareholder's equity in the building and right to occupy the apartment
(and a corresponding loss of the lender's security for its Cooperative Loan).

Tax Aspects of Cooperative Ownership. In general, a "tenant-
stockholder" (as defined in Section 216(b)(2) of the Code) of a corporation
that qualifies as a "cooperative housing corporation" within the meaning of
Section 216(b)(1) of the Code is allowed a deduction for amounts paid or
accrued within his taxable year to the corporation representing his
proportionate share of certain interest expenses and certain real estate
taxes allowable as a deduction under Section 216(a) of the Code to the
corporation under Sections 163 and 164 of the Code. In order for a
corporation to qualify under Section 216(b)(1) of the Code for its taxable
year in which such items are allowable as a deduction to the corporation,
such section requires, among other things, that at least 80% of the gross
income of the corporation be derived from its tenant-stockholders. By virtue
of this requirement, the status of a corporation for purposes of Section
216(b)(1) of the Code must be determined on a year-to-year basis.
Consequently, there can be no assurance that cooperatives relating to the
Cooperative Loans will qualify under such section for any particular year. In
the event that such a cooperative fails to qualify for one or more years, the
value of the collateral securing any related Cooperative Loans could be
significantly impaired because no deduction would be allowable to tenant-
stockholders under Section 216(a) of the Code with respect to those years. In
view of the significance of the tax benefits accorded tenant-stockholders of
a corporation that qualifies under Section 216(b)(1) of the Code, the
likelihood that such a failure would be permitted to continue over a period
of years appears remote.

Foreclosure on Mortgages

Foreclosure of a deed of trust is generally accomplished by a non-
judicial trustee's sale under a specific provision in the deed of trust which
authorizes the trustee to sell the property upon any default by the borrower
under the terms of the note or deed of trust. In some states, the trustee
must record a notice of default and send a copy to the borrower-trustor and
to any person who has recorded a request for a copy of a notice of default
and notice of sale. In addition, the trustee in some states must provide
notice to any other individual having an interest in the real property,
including any junior lienholders. The trustor, borrower, or any person having
a junior encumbrance on the real estate, may, during a reinstatement period,
cure the default by paying the entire amount in arrears plus the costs and
expenses incurred in enforcing the obligation. Generally, state law controls
the amount of foreclosure expenses and costs, including attorney's fees,
which may be recovered by a lender. If the deed of trust is not reinstated, a
notice of sale must be posted in a public place and, in most states,
published for a specific period of time in one or more newspapers. In
addition, some state laws require that a copy of the notice of sale be posted
on the property, recorded and sent to all parties having an interest in the
real property.

An action to foreclose a mortgage is an action to recover the mortgage
debt by enforcing the mortgagee's rights under the mortgage. It is regulated
by statutes and rules and subject throughout to the court's equitable powers.
Generally, a mortgagor is bound by the terms of the mortgage note and the
mortgage as made and cannot be relieved from his default if the mortgagee has
exercised his rights in a commercially reasonable manner. However, since a
foreclosure action historically was equitable in nature, the court may
exercise equitable powers to relieve a mortgagor of a default and deny the
mortgagee foreclosure on proof that either the mortgagor's default was
neither willful nor in bad faith or the mortgagee's action established a
waiver, fraud, bad faith, or oppressive or unconscionable conduct such as to
warrant a court of equity to refuse affirmative relief to the mortgagee.
Under certain circumstances a court of equity may relieve the mortgagor from
an entirely technical default where such default was not willful.

A foreclosure action is subject to most of the delays and expenses of
other lawsuits if defenses or counterclaims are interposed, sometimes
requiring up to several years to complete. Moreover, a non-collusive,
regularly conducted foreclosure sale may be challenged as a fraudulent
conveyance, regardless of the parties' intent, if a court determines that the
sale was for less than fair consideration and such sale occurred while the
mortgagor was insolvent and within one year (or within the state statute of
limitations if the trustee in bankruptcy elects to proceed under state
fraudulent conveyance law) of the filing of bankruptcy. Similarly, a suit
against the debtor on the mortgage note may take several years and,
generally, is a remedy alternative to foreclosure, the mortgagee generally
being precluded from pursuing both at the same time.

In case of foreclosure under either a mortgage or a deed of trust, the
sale by the referee or other designated officer or by the trustee is a public
sale. However, because of the difficulty potential third party purchasers at
the sale have in determining the exact status of title and because the
physical condition of the property may have deteriorated during the
foreclosure proceedings, it is uncommon for a third party to purchase the
property at a foreclosure sale. Rather, it is common for the lender to
purchase the property from the trustee or referee for an amount which may be
equal to the principal amount of the mortgage or deed of trust plus accrued
and unpaid interest and the expenses of foreclosure, in which event the
mortgagor's debt will be extinguished or the lender may purchase for a lesser
amount in order to preserve its right against a borrower to seek a deficiency
judgment in states where such a judgment is available. Thereafter, the lender
will assume the burdens of ownership, including obtaining casualty insurance,
paying taxes and making such repairs at its own expense as are necessary to
render the property suitable for sale. The lender will commonly obtain the
services of a real estate broker and pay the broker's commission in
connection with the sale of the property. Depending upon market conditions,
the ultimate proceeds of the sale of the property may not equal the lender's
investment in the property. Any loss may be reduced by the receipt of any
mortgage guaranty insurance proceeds.

Realizing Upon Cooperative Loan Security

The Cooperative shares and proprietary lease or occupancy agreement
owned by the tenant- stockholder and pledged to the lender are, in almost all
cases, subject to restrictions on transfer as set forth in the Cooperative's
certificate of incorporation and by-laws, as well as in the proprietary lease
or occupancy agreement. The proprietary lease or occupancy agreement, even
while pledged, may be cancelled by the Cooperative for failure by the tenant-
stockholder to pay rent or other obligations or charges owed by such tenant-
stockholder, including mechanics' liens against the Cooperative apartment
building incurred by such tenant-stockholder. Commonly, rent and other
obligations and charges arising under a proprietary lease or occupancy
agreement which are owed to the Cooperative are made liens upon the shares to
which the proprietary lease or occupancy agreement relates. In addition, the
proprietary lease or occupancy agreement generally permits the Cooperative to
terminate such lease or agreement in the event the borrower defaults in the
performance of covenants thereunder. Typically, the lender and the
Cooperative enter into a recognition agreement which establishes the rights
and obligations of both parties in the event of a default by the tenant-
stockholder on its obligations under the proprietary lease or occupancy
agreement. A default by the tenant- stockholder under the proprietary lease
or occupancy agreement will usually constitute a default under the security
agreement between the lender and the tenant-stockholder.

The recognition agreement generally provides that, in the event that the
tenant-stockholder has defaulted under the proprietary lease or occupancy
agreement, the Cooperative will take no action to terminate such lease or
agreement until the lender has been provided with an opportunity to cure the
default. The recognition agreement typically provides that if the proprietary
lease or occupancy agreement is terminated, the Cooperative will recognize
the lender's lien against proceeds from a sale of the Cooperative apartment,
subject, however, to the Cooperative's right to sums due under such
proprietary lease or occupancy agreement or which have become liens on the
shares relating to the proprietary lease or occupancy agreement. The total
amount owed to the Cooperative by the tenant-stockholder, which the lender
generally cannot restrict and does not monitor, could reduce the value of the
collateral below the outstanding principal balance of the Cooperative Loan
and accrued and unpaid interest thereon.

Recognition agreements also provide that in the event the lender
succeeds to the tenant- shareholder's shares and proprietary lease or
occupancy agreement as the result of realizing upon its collateral for a
Cooperative Loan, the lender must obtain the approval or consent of the
Cooperative as required by the proprietary lease before transferring the
Cooperative shares or assigning the proprietary lease.

In New York, lenders generally have realized upon the pledged shares and
proprietary lease or occupancy agreement given to secure a Cooperative Loan
by public sale in accordance with the provisions of Article 9 of the New York
Uniform Commercial Code (the "UCC") and the security agreement relating to
those shares. Article 9 of the UCC requires that a sale be conducted in a
"commercially reasonable" manner. Whether a sale has been conducted in a
"commercially reasonable" manner will depend on the facts in each case. In
determining commercial reasonableness, a court will look to the notice given
the debtor and the method, manner, time, place and terms of the sale.
Generally, a sale conducted according to the usual practice of banks selling
similar collateral will be considered reasonably conducted.

Article 9 of the UCC provides that the proceeds of the sale will be
applied first to pay the costs and expenses of the sale and then to satisfy
the indebtedness secured by the lender's security interest. The recognition
agreement, however, generally provides that the lender's right to
reimbursement is subject to the right of the Cooperative corporation to
receive sums due under the proprietary lease or occupancy agreement. If there
are proceeds remaining, the lender must account to the tenant-stockholder for
the surplus. Conversely, if a portion of the indebtedness remains unpaid, the
tenant-stockholder is generally responsible for the deficiency. See "Anti-
Deficiency Legislation and Other Limitations on Lenders" below.

In the case of foreclosure on a building which was converted from a
rental building to a building owned by a cooperative under a non-eviction
plan, some states require that a purchaser at a foreclosure sale take the
property subject to rent control and rent stabilization laws which apply to
certain tenants who elect to remain in the building but who did not purchase
shares in the cooperative when the building was so converted.

Rights of Redemption

In some states, after sale pursuant to a deed of trust or foreclosure of
a mortgage, the trustor or mortgagor and foreclosed junior lienors are given
a statutory period in which to redeem the property from the foreclosure sale.
The right of redemption should be distinguished from the equity of
redemption, which is a nonstatutory right that must be exercised prior to the
foreclosure sale. In some states, redemption may occur only upon payment of
the entire principal balance of the loan, accrued interest and expenses of
foreclosure. In other states, redemption may be authorized if the former
borrower pays only a portion of the sums due. The effect of a statutory right
of redemption is to diminish the ability of the lender to sell the foreclosed
property. The right of redemption would defeat the title of any purchaser
from the lender subsequent to foreclosure or sale under a deed of trust.
Consequently, the practical effect of a right of redemption is to force the
lender to retain the property and pay the expenses of ownership until the
redemption period has run. In some states, there is no right to redeem
property after a trustee's sale under a deed of trust.

Anti-Deficiency Legislation and Other Limitations on Lenders

Certain states have imposed statutory prohibitions which limit the
remedies of a beneficiary under a deed of trust or a mortgagee under a
mortgage. In some states, statutes limit the right of the beneficiary or
mortgagee to obtain a deficiency judgment against the borrower following
foreclosure or sale under a deed of trust. A deficiency judgment is a
personal judgment against the former borrower equal in most cases to the
difference between the net amount realized upon the public sale of the real
property and the amount due to the lender. Other statutes require the
beneficiary or mortgagee to exhaust the security afforded under a deed of
trust or mortgage by foreclosure in an attempt to satisfy the full debt
before bringing a personal action against the borrower. Finally, other
statutory provisions limit any deficiency judgment against the former
borrower following a judicial sale to the excess of the outstanding debt over
the fair market value of the property at the time of the public sale. The
purpose of these statutes is generally to prevent a beneficiary or a
mortgagee from obtaining a large deficiency judgment against the former
borrower as a result of low or no bids at the judicial sale.

Cooperative Loans. Generally, lenders realize on cooperative shares and
the accompanying proprietary lease given to secure a Cooperative Loan under
Article 9 of the UCC. Some courts have interpreted section 9-504 of the UCC
to prohibit a deficiency award unless the creditor establishes that the sale
of the collateral (which, in the case of a Cooperative Loan, would be the
shares of the Cooperative and the related proprietary lease or occupancy
agreement) was conducted in a commercially reasonable manner.

Leases and Rents. Multifamily mortgage loan transactions often provide
for an assignment of the leases and rents pursuant to which the borrower
typically assigns its right, title and interest, as landlord under each lease
and the income derived therefrom, to the lender while either obtaining a
license to collect rents for so long as there is no default or providing for
the direct payment to the lender. Local law, however, may require that the
lender take possession of the property and appoint a receiver before becoming
entitled to collect the rents under the lease.

Federal Bankruptcy and Other Laws Affecting Creditors' Rights. In
addition to laws limiting or prohibiting deficiency judgments, numerous other
statutory provisions, including the federal bankruptcy laws, the Federal
Soldiers' and Sailors' Relief Act, and state laws affording relief to
debtors, may interfere with or affect the ability of the secured lender to
realize upon collateral and/or enforce a deficiency judgment. For example,
with respect to federal bankruptcy law, the filing of a petition acts as a
stay against the enforcement of remedies for collection of a debt. Moreover,
a court with federal bankruptcy jurisdiction may permit a debtor through a
Chapter 13 rehabilitative plan under the Bankruptcy Code to cure a monetary
default with respect to a loan on a debtor's residence by paying arrearages
within a reasonable time period and reinstating the original loan payment
schedule even though the lender accelerated the loan and the lender has taken
all steps to realize upon his security (provided no sale of the property has
yet occurred) prior to the filing of the debtor's Chapter 13 petition. Some
courts with federal bankruptcy jurisdiction have approved plans, based on the
particular facts of the reorganization case, that effected the curing of a
loan default by permitting the obligor to pay arrearages over a number of
years.

Courts with federal bankruptcy jurisdiction have also indicated that the
terms of a loan secured by property of the debtor may be modified if the
borrower has filed a petition under Chapter 13. These courts have suggested
that such modifications may include reducing the amount of each monthly
payment, changing the rate of interest, altering the repayment schedule and
reducing the lender's security interest to the value of the residence, thus
leaving the lender a general unsecured creditor for the difference between
the value of the residence and the outstanding balance of the loan. Federal
bankruptcy law and limited case law indicate that the foregoing modifications
could not be applied to the terms of a loan secured by property that is the
principal residence of the debtor. In all cases, the secured creditor is
entitled to the value of its security plus post-petition interest, attorney's
fees and costs to the extent the value of the security exceeds the debt.

In a Chapter 11 case under the Bankruptcy Code, the lender is precluded
from foreclosing without authorization from the bankruptcy court. The
lender's lien may be transferred to other collateral and/or be limited in
amount to the value of the lender's interest in the collateral as of the date
of the bankruptcy. The loan term may be extended, the interest rate may be
adjusted to market rates and the priority of the loan may be subordinated to
bankruptcy court-approved financing. The bankruptcy court can, in effect,
invalidate due-on-sale clauses through confirmed Chapter 11 plans of
reorganization.

The Bankruptcy Code provides priority to certain tax liens over the
lender's security. This may delay or interfere with the enforcement of rights
in respect of a defaulted Loan. In addition, substantive requirements are
imposed upon lenders in connection with the origination and the servicing of
mortgage loans by numerous federal and some state consumer protection laws.
The laws include the federal Truth-in-Lending Act, Real Estate Settlement
Procedures Act, Equal Credit Opportunity Act, Fair Credit Billing Act, Fair
Credit Reporting Act and related statutes and regulations. These federal laws
impose specific statutory liabilities upon lenders who originate loans and
who fail to comply with the provisions of the law. In some cases, this
liability may affect assignees of the loans.

Federal Bankruptcy Laws Relating to Mortgage Loans Secured by
Multifamily Property. Section 365(a) of the Bankruptcy Code generally
provides that a trustee or a debtor-in-possession in a bankruptcy or
reorganization case under the Bankruptcy Code has the power to assume or to
reject an executory contract or an unexpired lease of the debtor, in each
case subject to the approval of the bankruptcy court administering such case.
If the trustee or debtor-in-possession rejects an executory contract or an
unexpired lease, such rejection generally constitutes a breach of the
executory contract or unexpired lease immediately before the date of the
filing of the petition. As a consequence, the other party or parties to such
executory contract or unexpired lease, such as the Mortgagor, as lessor under
a lease, would have only an unsecured claim against the debtor for damages
resulting from such breach, which could adversely affect the security for the
related Mortgage Loan. Moreover, under Section 502(b)(6) of the Bankruptcy
Code, the claim of a lessor for such damages from the termination of a lease
of real property will be limited to the sum of (i) the rent reserved by such
lease, without acceleration, for the greater of one year or 15 percent, not
to exceed three years, of the remaining term of such lease, following the
earlier of the date of the filing of the petition and the date on which such
lender repossessed, or the lessee surrendered, the leased property, and (ii)
any unpaid rent due under such lease, without acceleration, on the earlier of
such dates.

Under Section 365(h) of the Bankruptcy Code, if a trustee for a lessor,
or a lessor as a debtor-in-possession, rejects an unexpired lease of real
property, the lessee may treat such lease as terminated by such rejection or,
in the alternative, may remain in possession of the leasehold for the balance
of such term and for any renewal or extension of such term that is
enforceable by the lessee under applicable nonbankruptcy law. The Bankruptcy
Code provides that if a lessee elects to remain in possession after such a
rejection of a lease, the lessee may offset against rents reserved under the
lease for the balance of the term after the date of rejection of the lease,
and any such renewal or extension thereof, any damages occurring after such
date caused by the nonperformance of any obligation of the lessor under the
lease after such date.

Under Section 365(f) of the Bankruptcy Code, if a trustee assumes an
executory contract or an unexpired lease of the debtor, the trustee or
debtor-in-possession generally may assign such executory contract or
unexpired lease, notwithstanding any provision therein or in applicable law
that prohibits, restricts or conditions such assignment, provided that the
trustee or debtor-in-possession provides adequate assurance of future
performance by the assignee. In addition, no party to an executory contract
or an unexpired lease may terminate or modify any rights or obligations under
an executory contract or an unexpired lease at any time after the
commencement of a case under the Bankruptcy Code solely because of a
provision in the executory contract or unexpired lease or in applicable law
conditioned upon the assignment of the executory contract or unexpired lease.
Thus, an undetermined third party may assume the obligations of the lessee or
a Mortgagor under a lease in the event of commencement of a proceeding under
the Bankruptcy Code with respect to the lessee or a Mortgagor, as applicable.

Under Sections 363(b) and (f) of the Bankruptcy Code, a trustee for a
lessor, or a lessor as debtor-in-possession, may, despite the provisions of
the related Mortgage Loan to the contrary, sell the Mortgaged Property free
and clear of all liens, which liens would then attach to the proceeds of such
sale.

Soldiers' and Sailors' Civil Relief Act of 1940

Under the Soldiers' and Sailors' Civil Relief Act of 1940, members of
all branches of the military on active duty, including draftees and
reservists in military service, (i) are entitled to have interest rates
reduced and capped at 6% per annum, on obligations (including mortgage loans
and manufactured home loans) incurred prior to the commencement of military
service for the duration of military service, (ii) may be entitled to a stay
of proceedings on any kind of foreclosure or repossession action in the case
of defaults on such obligations entered into prior to military service and
(iii) may have the maturity of such obligations incurred prior to military
service extended, the payments lowered and the payment schedule readjusted
for a period of time after the completion of military service. However, the
benefits of (i), (ii), or (iii) above are subject to challenge by creditors
and if, in the opinion of the court, the ability of a person to comply with
such obligations is not materially impaired by military service, the court
may apply equitable principles accordingly. If a borrower's obligation to
repay amounts otherwise due on a Mortgage Loan or Manufactured Home Loan
included in a Trust for a Series is relieved pursuant to the Soldiers' and
Sailors' Civil Relief Act of 1940, neither the Servicer, the Master Servicer
nor the Trustee will be required to advance such amounts, and any loss in
respect thereof may reduce the amounts available to be paid to the holders of
the Certificates of such Series.

Unless otherwise specified in the related Prospectus Supplement, any
shortfalls in interest collections on Mortgage Loans included in a Trust for
a Series resulting from application of the Soldiers' and Sailors' Civil
Relief Act of 1940 will be allocated to each Class of Certificates of such
Series that is entitled to receive interest in respect of such Mortgage Loans
or Manufactured Home Loans in proportion to the interest that each such Class
of Certificates would have otherwise been entitled to receive in respect of
such Mortgage Loans had such interest shortfall not occurred.

Environmental Risks

Under the laws of some states, and under the federal Comprehensive
Environmental Response, Compensation and Liability Act of 1980 ("CERCLA"), it
is conceivable that a secured lender (such as the Trust Fund) may be held
liable as an "owner" or "operator" for the costs of addressing releases or
threatened releases of hazardous substances at a Mortgage Property, even
though the environmental damage or threat was caused by a prior or current
owner or "responsible parties", including owners and operators. However,
CERCLA excludes from the definition of "owner or operator" a secured creditor
who holds indicia of ownership primarily to protect its security interest,
but does not "participate in the management" of the Mortgaged Property (the
"secured creditor exclusion"). Thus, if a lender's activities begin to
encroach on the actual management of a contaminated property, the lender may
incur liability as an "owner or operator" under CERCLA. Similarly, if a
lender forecloses and takes title to a contaminated property, the lender may
incur CERCLA liability in various circumstances, including, but not limited
to, when it holds the property as an investment (including leasing the
property to a third party), or fails to market the property in a timely
fashion.

Recently enacted amendments to CERCLA have clarified the range of
activities in which a lender may engage without becoming subject to liability
under CERCLA. However, liability for costs associated with the investigation
and cleanup of environmental contamination may also be governed by state law,
which may not provide any specific protections to lenders, or, alternatively,
may not impose liability on lenders at all.

CERCLA does not apply to petroleum products, and the secured creditor
exclusion does not govern liability for cleanup costs associated with
releases of petroleum contamination. Federal regulation of underground
petroleum storage tanks (other than heating oil tanks) is governed by
Subtitle I of the federal Resource Conservation and Recovery Act ("RCRA").
The United States Environmental Protection Agency ("EPA") has promulgated a
lender liability rule for underground storage tanks regulated by Subtitle I
of RCRA. Under the EPA rule, a holder of a security interest in an
underground storage tank, is not considered an operator of the underground
storage tank as long as petroleum is not added to, stored in or dispensed
from the tank. Moreover, recent amendments to RCRA, enacted currently with
the CERCLA amendments discussed in the previous paragraph, extend to the
holders of security interests in petroleum underground storage tanks the same
protections accorded to secured creditors under CERCLA. It should be noted,
however, that liability for cleanup of petroleum contamination may be
governed by state law, which may not provide any specific protection for
lenders, or, alternatively, may not impose liability on lenders at all.

Due-on-Sale Clauses in Mortgage Loans

Due-on-Sale clauses permit the lender to accelerate the maturity of the
loan if the borrower sells or transfers, whether voluntarily or
involuntarily, all or part of the real property securing the loan without the
lender's prior written consent. The enforceability of these clauses has been
impaired in various ways in certain states by statutory or decisional law.
The ability of lenders and their assignees and transferees to enforce due-on-
sale clauses was addressed by Congress when it enacted the Garn-St Germain
Depository Institutions Act of 1982 (the "Garn-St Germain Act"). The
legislation, subject to certain exceptions, provides for federal preemption
of all state restrictions on the enforceability of due-on-sale clauses.
Excluded from the preemption are loans originated or assumed during a "window
period" ("Window Period Loans"). The window period runs from the date the
state restricted the enforcement of the clauses, either by constitution,
statute, or statewide judicial proclamation, to October 15, 1982. All Window
Period Loans are governed by the restrictive state law until October 15,
1985, unless the state acted to extend the effect of the window period by
further regulating such loans. The Garn-St Germain Act further provides that
loans originated by a federal savings bank or a federally chartered savings
and loan association shall be governed by the regulations of the Federal Home
Loan Bank Board. These regulations preempt any state law restrictions and
expressly allow these federal lenders to enforce due-on-sale clauses. Loans
originated by such institutions are not subject to the window period and
therefore due-on-sale clauses in such loans are enforceable regardless of the
date the loans originated.

Although neither the Garn-St Germain Act nor the Federal Home Loan Bank
Board regulations promulgated thereunder actually lists the states with
window periods ("Window Period States"), FHLMC has taken the position, in
prescribing mortgage loan servicing standards with respect to loans which it
has purchased, that the Window Period States are Arizona, Arkansas,
California, Colorado, Florida, Georgia, Iowa, Michigan, Minnesota, New
Mexico, Utah and Washington. (Despite Florida's status as a Window Period
State, Florida case law indicates that courts no longer require a lender to
show an impairment of security before enforcing a due-on-sale clause.) In
regulations issued on November 8, 1983, as amended on December 9, 1983, the
Comptroller of the Currency indicated that certain loans which were
originated by national banks prior to October 15, 1982 and which were secured
by property located in the states listed above were Window Period Loans.
These regulations limit the effect of state law restrictions on the
enforcement of due-on-sale clauses, with respect to Window Period Loans
originated by national banks, by shortening the window period. On December 3,
1982, the National Credit Union Administration issued final regulations
allowing federal credit unions to enforce due-on-sale clauses in long term
first mortgage loans for transfers occurring on or after November 18, 1982,
notwithstanding state law restrictions.

Under the Garn-St Germain Act, unless a Window Period State took action
by October 15, 1985 to further regulate enforcement of due-on-sale clauses,
such clauses would become enforceable even in Window Period Loans. Five of
the Window Period States (Arizona, Minnesota, Michigan, Washington and Utah)
have acted to restrict the enforceability of due-on-sale clauses in Window
Period Loans beyond October 15, 1985. The actions taken vary among such
states. The Garn-St Germain Act also sets forth nine specific instances in
which no lender covered by the Garn-St Germain Act may exercise its option
pursuant to a due-on-sale clause, notwithstanding the fact that a transfer of
the property may have occurred. The inability to enforce a due-on-sale clause
may result in transfer of the related Mortgaged Property to an uncreditworthy
Person, which could increase the likelihood of default or may result in a
loan bearing an interest rate below the current market rate being assumed by
a new home buyer rather than being paid off, which may have an impact upon
the average life of the Loans related to a Series and the number of such
Loans which may be outstanding until maturity.

Enforceability of Prepayment and Late Payment Fees

Forms of notes, mortgages and deeds of trust used by lenders may contain
provisions obligating the borrower to pay a late charge if payments are not
timely made, and in some circumstances may provide for prepayment fees or
penalties if the obligation is paid prior to maturity. In certain states,
there are or may be specific limitations upon the late charges which a lender
may collect from a borrower for delinquent payments. Certain states also
limit the amounts that a lender may collect from a borrower as an additional
charge if the loan is prepaid. Late charges and prepayment fees are typically
retained by servicers as additional servicing compensation.

Equitable Limitations on Remedies

In connection with lenders' attempts to realize upon their security,
courts have invoked general equitable principles. The equitable principles
are generally designed to relieve the borrower from the legal effect of his
defaults under the loan documents. Examples of judicial remedies that have
been fashioned include judicial requirements that the lender undertake
affirmative and expensive actions to determine the causes for the borrower's
default and the likelihood that the borrower will be able to reinstate the
loan. In some cases, courts have substituted their judgment for the lender's
judgment and have required that lenders reinstate loans or recast payment
schedules in order to accommodate borrowers who are suffering from temporary
financial disability. In other cases, courts have limited the right of a
lender to realize upon his security if the default under the security
agreement is not monetary, such as the borrower's failure to adequately
maintain the property or the borrower's execution of secondary financing
affecting the property. Finally, some courts have been faced with the issue
of whether or not federal or state constitutional provisions reflecting due
process concerns for adequate notice require that borrowers under security
agreements receive notices in addition to the statutorily-prescribed
minimums. For the most part, these cases have upheld the notice provisions as
being reasonable or have found that, in cases involving the sale by a trustee
under a deed of trust or by a mortgagee under a mortgage having a power of
sale, there is insufficient state action to afford constitutional protections
to the borrower.

Most conventional single-family mortgage loans may be prepaid in full or
in part without penalty. The regulations of the Federal Home Loan Bank Board
prohibit the imposition of a prepayment penalty or equivalent fee for or in
connection with the acceleration of a loan by exercise of a due-on-sale
clause. A mortgagee to whom a prepayment in full has been tendered may be
compelled to give either a release of the mortgage or an instrument assigning
the existing mortgage. The absence of a restraint on prepayment, particularly
with respect to Mortgage Loans having higher mortgage rates, may increase the
likelihood of refinancing or other early retirements of the Mortgage Loans.

Applicability of Usury Laws

Title V of the Depository Institutions Deregulation and Monetary Control
Act of 1980, enacted in March 1980 ( "Title V"), provides that state usury
limitations shall not apply to certain types of residential first mortgage
loans originated by certain lenders after March 31, 1980. Similar federal
statutes were in effect with respect to mortgage loans made during the first
three months of 1980. The Federal Home Loan Bank Board is authorized to issue
rules and regulations and to publish interpretations governing implementation
of Title V. Title V authorizes any state to reimpose interest rate limits by
adopting, before April 1, 1983, a state law, or by certifying that the voters
of such state have voted in favor of any provision, constitutional or
otherwise, which expressly rejects an application of the federal law. Fifteen
states adopted such a law prior to the April 1, 1983 deadline. In addition,
even where Title V is not so rejected, any state is authorized by the law to
adopt a provision limiting discount points or other charges on mortgage loans
covered by Title V.

The Depositor has been advised by counsel that a court interpreting
Title V would hold that Mortgage Loans related to a Series originated on or
after January 1, 1980 are subject to federal preemption. Therefore, in a
state that has not taken the requisite action to reject application of Title
V or to adopt a provision limiting discount points or other charges prior to
origination of such Mortgage Loans, any such limitation under such state's
usury law would not apply to such Mortgage Loans.

In any state in which application of Title V has been expressly rejected
or a provision limiting discount points or other charges is adopted, no
Mortgage Loans originated after the date of such state action will be
eligible as Primary Assets if such Mortgage Loans bear interest or provide
for discount points or charges in excess of permitted levels. No Mortgage
Loan originated prior to January 1, 1980 will bear interest or provide for
discount points or charges in excess of permitted levels.

Adjustable Interest Rate Loans

ARMs originated by non-federally chartered lenders have historically
been subject to a variety of restrictions. Such restrictions differed from
state to state, resulting in difficulties in determining whether a particular
alternative mortgage instrument originated by a state-chartered lender
complied with applicable law. These difficulties were alleviated
substantially as a result of the enactment of Title VIII of the Garn-St
Germain Act ("Title VIII"). Title VIII provides that, notwithstanding any
state law to the contrary, state-chartered banks may originate "alternative
mortgage instruments" (including ARMs) in accordance with regulations
promulgated by the Comptroller of the Currency with respect to origination of
alternative mortgage instruments by national banks; state-chartered credit
unions may originate alternative mortgage instruments in accordance with
regulations promulgated by the National Credit Union Administration with
respect to origination of alternative mortgage instruments by federal credit
unions and all other non-federally chartered housing creditors, including
state-chartered savings and loan associations; and state-chartered savings
banks and mortgage banking companies may originate alternative mortgage
instruments in accordance with the regulations promulgated by the Federal
Home Loan Bank Board with respect to origination of alternative mortgage
instruments by federal savings and loan associations. Title VIII provides
that any state may reject applicability of the provisions of Title VIII by
adopting, prior to October 15, 1985, a law or constitutional provision
expressly rejecting the applicability of such provisions. Certain states have
taken such action.

The Depositor has been advised by its counsel that it is their opinion
that a court interpreting Title VIII would hold that ARMs which were
originated by state-chartered lenders before the date of enactment of any
state law or constitutional provision rejecting applicability of Title VIII
would not be subject to state laws imposing restrictions or prohibitions on
the ability of state-chartered lenders to originate alternative mortgage
instruments.

Manufactured Home Loans

Security Interests in the Manufactured Homes. Law governing perfection
of a security interest in a Manufactured Home varies from state to state.
Security interests in Manufactured Homes may be perfected either by notation
of the secured party's lien on the certificate of title or by delivery of the
required documents and payment of a fee to the state motor vehicle authority,
depending on state law. In some nontitle states, perfection pursuant to the
provisions of the UCC is required. The lender or a servicer may effect such
notation or delivery of the required documents and fees, and obtain
possession of the certificate of title, as appropriate under the laws of the
state in which any manufactured home securing a Manufactured Home Loan is
registered. In the event such notation or delivery is not effected or the
security interest is not filed in accordance with the applicable law (for
example, is filed under a motor vehicle title statute rather than under the
UCC, in a few states), a first priority security interest in the Manufactured
Home securing a Manufactured Home Loan may not be obtained. As Manufactured
Homes have become larger and often have been attached to their sites without
any apparent intention to move them, courts in many states have held that
Manufactured Homes, under certain circumstances, may become subject to real
estate title and recording laws. As a result, a security interest in a
Manufactured Home could be rendered subordinate to the interests of other
parties claiming an interest in the Manufactured Home under applicable state
real estate law. In order to perfect a security interest in a Manufactured
Home under real estate laws, the holder of the security interest must file
either a "fixture filing" under the provisions of the UCC or a real estate
mortgage under the real estate laws of the state where the home is located.
These filings must be made in the real estate records office of the county
where the home is located. Manufactured Home Loans typically contain
provisions prohibiting the borrower from permanently attaching the
Manufactured Home to its site. So long as the borrower does not violate this
agreement, a security interest in the Manufactured Home will be governed by
the certificate of title laws or the UCC, and the notation of the security
interest on the certificate of title or the filing of a UCC financing
statement will be effective to maintain the priority of the security interest
in the Manufactured Home. If, however, a Manufactured Home is permanently
attached to its site, other parties could obtain an interest in the
Manufactured Home which is prior to the security interest originally retained
by the lender or its assignee. With respect to a Series of Certificates
evidencing interests in a Trust Fund that includes Manufactured Home Loans
and as described in the related Prospectus Supplement, the Depositor may be
required to perfect a security interest in the Manufactured Home under
applicable real estate laws. If such real estate filings are not made and if
any of the foregoing events were to occur, the only recourse of the
Certificateholders would be against the Depositor pursuant to its repurchase
obligation for breach of warranties. A PMBS Agreement pursuant to which
Private Mortgage-Backed Securities backed by Manufactured Home Loans are
issued will, unless otherwise specified in the related Prospectus Supplement,
have substantially similar requirements for perfection of a security
interest.

In general, upon an assignment of a Manufactured Home Loan, the
certificate of title relating to the Manufactured Home will not be amended to
identify the assignee as the new secured party. In most states, an assignment
is an effective conveyance of such security interest without amendment of any
lien noted on the related certificate of title and the new secured party
succeeds to the assignor's rights as the secured party. However, in some
states there exists a risk that, in the absence of an amendment to the
certificate of title, such assignment of the security interest might not be
held effective against creditors of the assignor.

Relocation of a Manufactured Home. In the event that the owner of a
Manufactured Home moves the home to a state other than the state in which
such Manufactured Home initially is registered, under the laws of most states
the perfected security interest in the Manufactured Home would continue for
four months after such relocation and thereafter only if and after the owner
reregisters the Manufactured Home in such state. If the owner were to
relocate a Manufactured Home to another state and not reregister the
Manufactured Home in such state, and if steps are not taken to reperfect the
Trustee's security interest in such state, the security interest in the
Manufactured Home would cease to be perfected. A majority of states generally
require surrender of a certificate of title to reregister a Manufactured
Home; accordingly, possession of the certificate of title to such
Manufactured Home must be surrendered or, in the case of Manufactured Homes
registered in states which provide for notation of lien, the notice of
surrender must be given to any person whose security interest in the
Manufactured Home is noted on the certificate of title. Accordingly, the
owner of the Manufactured Home Loan would have the opportunity to reperfect
its security interest in the Manufactured Home in the state of relocation. In
states which do not require a certificate of title for registration of a
Manufactured Home, reregistration could defeat perfection. In the ordinary
course of servicing the Manufactured Home Loans, the Master Servicer will be
required to take steps to effect reperfection upon receipt of notice of
reregistration or information from the borrower as to relocation. Similarly,
when a borrower under a Manufactured Home Loan sells the related Manufactured
Home, the Trustee must surrender possession of the certificate of title or
the Trustee will receive notice as a result of its lien noted thereon and
accordingly will have an opportunity to require satisfaction of the related
Manufactured Home Loan before release of the lien. Under the Trust Agreement,
the Depositor is obligated to take such steps, at the Servicer's expense, as
are necessary to maintain perfection of security interests in the
Manufactured Homes. PMBS Agreements pursuant to which Private Mortgage-Backed
Securities backed by Manufactured Home Loans are issued will impose
substantially similar requirements.

Intervening Liens. Under the laws of most states, liens for repairs
performed on a Manufactured Home take priority even over a perfected security
interest. The Depositor will represent that it has no knowledge of any such
liens with respect to any Manufactured Home securing payment on any
Manufactured Home Loan. However, such liens could arise at any time during
the term of a Manufactured Home Loan. No notice will be given to the Trustee
or Certificateholders in the event such a lien arises. PMBS Agreements
pursuant to which Private Mortgage-Backed Securities backed by Manufactured
Home Loans are issued will contain substantially similar requirements.

Enforcement of Security Interests in Manufactured Homes. So long as the
Manufactured Home has not become subject to the real estate law, a creditor
can repossess a Manufactured Home securing a Manufactured Home Loan by
voluntary surrender, by "self-help" repossession that is "peaceful" (i.e.,
without breach of the peace) or in the absence of voluntary surrender and the
ability to repossess without breach of the peace, by judicial process. The
holder of a Manufactured Home Loan must give the debtor a number of days'
notice, which varies from 10 to 30 days depending on the state, prior to
commencement of any repossession. The UCC and consumer protection laws in
most states place restrictions on repossession sales, including requiring
prior notice to the debtor and commercial reasonableness in effecting such a
sale. The law in most states also requires that the debtor be given notice of
any sale prior to resale of the unit so that the debtor may redeem at or
before such resale. In the event of such repossession and resale of a
Manufactured Home, the holder of a Manufactured Home Loan would be entitled
to be paid out of the sale proceeds before such proceeds could be applied to
the payment of the claims of unsecured creditors or the holders of
subsequently perfected security interests or, thereafter, to the borrower.

Under the laws applicable in most states, a creditor is entitled to
obtain a deficiency judgment from a borrower for any deficiency on
repossession and resale of the Manufactured Home securing such borrower's
loan. However, some states impose prohibitions or limitations on deficiency
judgments. See "Antideficiency Legislation and Other Limitations on Lenders"
above.

Certain other statutory provisions, including federal and state
bankruptcy and insolvency laws and general equitable principles, may limit or
delay the ability of a lender to repossess and resell collateral or enforce a
deficiency judgment. See "Federal Bankruptcy and Other Law Affecting
Creditors' Rights" and "Equitable Limitations on Remedies" above.

Consumer Protection Laws. The so-called "Holder-In-Due-Course" rule of
the Federal Trade Commission is intended to defeat the ability of the
transferor of a consumer credit contract who is the seller of goods which
gave rise to the transaction (and certain related lenders and assignees) to
transfer such contract free of notice of claims by the borrower thereunder.
The effect of this rule is to subject the assignee of such a contract to all
claims and defenses which the borrower could assert against the seller of
goods. Liability under this rule is limited to amounts paid under a
Manufactured Home Loan; however, the borrower also may be able to assert the
rule to set off remaining amounts due as a defense against a claim brought
against such borrower. Numerous other federal and state consumer protection
laws impose requirements applicable to the origination and lending pursuant
to the Manufactured Home Loan, including the Truth-in-Lending Act, the
Federal Trade Commission Act, the Fair Credit Billing Act, the Fair Credit
Reporting Act, the Equal Credit Opportunity Act, the Fair Debt Collection
Practices Act and the Uniform Consumer Credit Code. In the case of some of
these laws, the failure to comply with their provisions may affect the
enforceability of the related Manufactured Home Loan.

Transfers of Manufactured Homes; Enforceability of "Due-on-Sale"
Clauses. Loans and installment sale contracts relating to a Manufactured
Home Loan typically prohibit the sale or transfer of the related Manufactured
Homes without the consent of the lender and permit the acceleration of the
maturity of the Manufactured Home Loans by the lender upon any such sale or
transfer for which no such consent is granted.

In the case of a transfer of a Manufactured Home, the lender's ability
to accelerate the maturity of the related Manufactured Home Loan will depend
on the enforceability under state law of the "due-on-sale" clause. The Garn-
St. Germain Depositary Institutions Act of 1982 preempts, subject to certain
exceptions and conditions, state laws prohibiting enforcement of "due-on-
sale" clauses applicable to the Manufactured Homes. See " 'Due-On-Sale'
Clauses in Mortgage Loans" above. With respect to any Manufactured Home Loan
secured by a Manufactured Home occupied by the borrower, the ability to
accelerate will not apply to those types of transfers discussed in " 'Due-On-
Sale' Clauses in Mortgage Loans" above. FHA Loans and VA Loans are not
permitted to contain "due-on-sale" clauses, and so are freely assumable.

Applicability of Usury Laws. Title V provides that, subject to the
following conditions, state usury limitations shall not apply to any loan
which is secured by a first lien on certain kinds of Manufactured Homes. The
Manufactured Home Loans would be covered if they satisfy certain conditions,
among other things, governing the terms of any prepayments, late charges and
deferral fees and requiring a 30-day notice period prior to instituting any
action leading to repossession of or foreclosure with respect to the related
unit. See "Applicability of Usury Laws" above.

CERTAIN FEDERAL INCOME TAX CONSIDERATIONS

General

The following is a summary of certain anticipated federal income tax
consequences of the purchase, ownership, and disposition of the Certificates.
The summary is based upon the provisions of the Code, the regulations
promulgated thereunder, including, where applicable, proposed regulations,
and the judicial and administrative rulings and decisions now in effect, all
of which are subject to change or possible differing interpretations. The
statutory provisions, regulations, and interpretations on which this
interpretation is based are subject to change, and such a change could apply
retroactively.

The summary does not purport to deal with all aspects of federal income
taxation that may affect particular investors in light of their individual
circumstances, nor with certain types of investors subject to special
treatment under the federal income tax laws. This summary focuses primarily
upon investors who will hold Certificates as "capital assets" (generally,
property held for investment) within the meaning of Section 1221 of the Code,
but much of the discussion is applicable to other investors as well.
Potential purchasers of Certificates are advised to consult their own tax
advisers concerning the federal, state or local tax consequences to them of
the purchase, holding and disposition of the Certificates.

Characterization of Certificates

Unless otherwise stated in the applicable Prospectus Supplement, a REMIC
or a FASIT election will be made with respect to each Series of Certificates.
In such a case, special counsel to the Issuer will deliver its opinion to the
effect that under then-current law, the arrangement by which the Certificates
of that Series are issued will be treated as a REMIC or as a FASIT as long as
all of the provisions of the applicable Indenture or Trust Agreement, as
applicable, are complied with and the statutory and regulatory requirements
are satisfied. Certificates of such Series will be designated as "regular
interests" or "residual interests" in a REMIC, or as "regular interests" or
"ownership interests" in a FASIT, as specified in the related Prospectus
Supplement. The opinion will assume the accuracy of certain representations
of the Depositor contained in the Trust Agreement.

If the applicable Prospectus Supplement so specifies with respect to a
Series of Certificates, the Certificates of such Series will not be treated
as regular or residual interests in a REMIC or as regular interests or
ownership interests in a FASIT for federal income tax purposes but instead
will be treated as (i) indebtedness of the Issuer, (ii) an undivided
beneficial ownership interest in the Mortgage Loans (and the arrangement
pursuant to which the Mortgage Loans will be held and the Certificates will
be issued will be treated as a grantor trust under Subpart E, part I of
subchapter J of the Code and not as an association taxable as a corporation
for federal income tax purposes); (iii) equity interests in an association
that will satisfy the requirements for qualification as a real estate
investment trust; or (iv) interests in an entity that will satisfy the
requirements for qualification as a partnership for federal income tax
purposes. The federal income tax consequences to Certificateholders of any
such Series will be described in the applicable Prospectus Supplement.

Qualification as a REMIC

In order for a pool of assets (each, a "REMIC Pool") to qualify as a
REMIC, it must comply with certain ongoing requirements set forth in the
Code. First, the REMIC must fulfill an asset test, which requires that
substantially all of the assets of the REMIC as of the close of the third
calendar month beginning after the "Startup Day" (generally the date that the
Certificates or Bonds are issued) and at all times thereafter consist of
"qualified mortgages" and "permitted investments" (generally, temporary
investments of collections on qualified mortgages) as those terms are defined
in the Code. In addition, a REMIC must also establish reasonable arrangements
to insure that residual interests therein are not held by "disqualified
organizations" (in general, entities that are not subject to federal income
tax). The Pooling and Servicing Agreement will require compliance with the
REMIC provisions.

The Code and applicable regulations define a "qualified mortgage" to
include an obligation that is principally secured by interest in real
property as those terms are defined in applicable regulations. In addition to
the foregoing, in order for a mortgage loan to be a "qualified mortgage," the
fair market value of the "interest in real property" (as specifically defined
for this purpose) securing the mortgage loan (reduced by certain items,
including the amount of any senior liens and a pro rata portion of any parity
liens) must equal at least 80% of the adjusted issue price of the mortgage
loan (generally, the proceeds of the loan to the borrower) at either (a) the
time it was originated or, if the Mortgage Loan has been significantly
modified (as described in applicable regulations), the time of such
modification, or (b) the time of contribution to the REMIC. Tax Counsel has
not independently investigated the qualification of the Mortgage Loans as
"qualified mortgages" pursuant to these provisions, but in rendering its
opinion has relied on representations of the Depositor in the Trust
Agreement.

If a REMIC fails to comply with one or more of the ongoing requirements
of the Code for REMIC status during any taxable year, the Code provides that
the entity will not be treated as a REMIC for such year or for any year
thereafter. In such case, the classification of the REMIC for federal income
tax purposes is uncertain. Some Classes of the Certificates may continue to
be treated as debt instruments for federal income tax purposes. On the other
hand, all or a part of the REMIC may be treated as a separate association
taxable as a corporation under Treasury regulations, and the Certificates may
be treated as stock interests therein and not as debt instruments. The Code
grants regulatory authority to the Treasury Department to issue regulations
that would grant relief from disqualification where failure to meet one or
more of the requirements for REMIC status occurs inadvertently and in good
faith. Any such relief may be accompanied by sanctions, however, such as the
imposition of a corporate tax on all or a portion of the REMIC's income for
the period of time during which the requirements for REMIC status were not
satisfied.

Except to the extent the related Prospectus Supplement specifies
otherwise, if a REMIC election is made with respect to a Series of
Certificates, (i) Certificates held by a domestic building and loan
association will constitute "a regular or a residual interest in a REMIC"
within the meaning of Code Section 7701(a)(19)(C)(xi) (assuming that at least
95% of the REMIC's assets consist of cash, government securities, "loans . .
. secured by an interest in real property," and other types of assets
described in Code Section 7701(a)(19)(C)); and (ii) Certificates held by a
real estate investment trust will constitute "real estate assets" within the
meaning of Code Section 856(c)(6)(B), and income with respect to the
Certificates will be considered "interest on obligations secured by mortgages
on real property or on interest in real property" within the meaning of Code
Section 856(c)(3)(B) (assuming, for both purposes, that at least 95% of the
REMIC's assets are qualifying assets). If less than 95% of the REMIC's assets
consist of assets described in (i) or (ii) above, then Certificates will
qualify for the tax treatment described in (i) or (ii) in the proportion that
such REMIC assets are qualifying assets. In general, Mortgage Loans secured
by non-residential real property will not constitute "loans . . . secured by
an interest in real property" within the meaning of Section 7701(a)(19)(C).

It is possible that various reserves or funds will reduce the proportion
of REMIC assets which qualify under the standards described above.

The Small Business Job Protection Act of 1996, as part of the repeal of
the bad debt reserve method for thrift institutions, repealed the application
of Code section 593(d) to any taxable year beginning after December 31, 1995.

Qualification as a FASIT

The Small Business and Job Protection Act of 1996 added Sections 860H
through 860L to the Code (the "FASIT Provisions"), which provide for a new
type of entity for federal income tax purposes known as a "financial asset
securitization investment trust" (a "FASIT"). Although the FASIT provisions
of the Code became effective on September 1, 1997, no Treasury regulations or
other administrative guidance have been issued with respect to those
provisions. Accordingly, definitive guidance cannot be provided with respect
to many aspects of the tax treatment of FASITs.

A Trust Fund will qualify as a FASIT if (i) a FASIT election is in
effect, (ii) certain tests concerning (A) the composition of the FASIT's
assets and (B) the nature of the investors' interests in the FASIT are met on
a continuing basis, and (iii) the Trust Fund is not a regulated investment
company as defined in section 851(a) of the Code.

For a Trust Fund to be eligible for FASIT status, substantially all of
the Trust Fund Assets must consist of "permitted assets" as of the close of
the third month beginning after the closing date and at all times thereafter
(the "FASIT Qualification Test"). Permitted assets include (i) cash or cash
equivalents, (ii) debt instruments with fixed terms that would qualify as
regular interests if issued by a REMIC (generally, instruments that provide
for interest at a fixed rate, a qualifying variable rate, or a qualifying
interest-only ("IO") type rate), (iii) foreclosure property, (iv) certain
hedging instruments (generally, interest and currency rate swaps and credit
enhancement contracts) that are reasonably required to guarantee or hedge
against the FASIT's risks associated with being the obligor on FASIT
interests, (v) contract rights to acquire qualifying debt instruments or
qualifying hedging instruments, (vi) FASIT regular interest, and (vii) REMIC
regular interests. Permitted assets do not include any debt instruments
issued by the holder of the FASIT's ownership interest or by any person
related to such holder.

In addition to the foregoing asset qualification requirements, the
interests in a FASIT also must meet certain requirements. All of the
interests in a FASIT must belong to either of the following: (i) one or more
classes of regular interests or (ii) a single class of ownership interest
that is held by a fully taxable domestic C Corporation. FASIT interests will
be classified as either FASIT regular interests, which generally will be
treated as debt for federal income tax purposes, or FASIT ownership
interests, which generally are not treated as debt for such purposes, but
rather as representing rights and responsibilities with respect to the
taxable income or loss of the related FASIT. The Prospectus Supplement for
each Series of Securities will indicate which Securities of such Series will
be designated as regular interests, and which, if any, will be designated as
ownership interests.

A FASIT interest generally qualifies as a regular interest if (i) it is
designated as a regular interest, (ii) it has a stated maturity no greater
than thirty years, (iii) it entitles its holder to a specified principal
amount, (iv) the issue price of the interest does not exceed 125% of its
stated principal amount, (v) the yield to maturity of the interest is less
than the applicable Treasury rate published by the IRS plus 5%, and (vi) if
it pays interest, such interest is payable at either (a) a fixed rate with
respect to the principal amount of the regular interest or (b) a permissible
variable rate with respect to such principal amount. Permissible variable
rates for FASIT regular interests are the same as those for REMIC regular
interests (i.e., certain qualified floating rates and weighted average
rates). Interest will be considered to be based on a permissible variable
rate if generally, (i) such interest is unconditionally payable at least
annually, (ii) the issue price of the debt instrument does not exceed the
total noncontingent principal payments and (iii) interest is based on a
"qualified floating rate," an "objective rate," a combination of a single
fixed rate and one or more "qualified floating rate," one "qualified inverse
floating rate," or a combination of "qualified floating rates" that do not
operate in a manner that significantly accelerates or defers interest
payments on such FASIT regular interest.

If an interest in a FASIT fails to meet one or more of the requirements
set out in clauses (iii), (iv), or (v) in the immediately preceding
paragraph, but otherwise meets all requirements to be treated as a FASIT, it
may still qualify as a type of regular interest known as a "High-Yield
Interest." In addition, if an interest in a FASIT fails to meet the
requirement of clause (vi), but the interest payable on the interest consists
of a specified portion of the interest payments on permitted assets and that
portion does not vary over the life of the security, the interest will also
qualify as a High-Yield Interest. A High-Yield Interest may be held only by
domestic C corporations that are fully subject to corporate income tax
("Eligible Corporations"), other FASITs, and dealers in securities who
acquire such interests as inventory, rather than for investment. In
addition, holders of High-Yield Interests are subject to limitations on
offset of income derived from such interest. See "Certain Federal Income Tax
Consequences--Taxation of Trust as a FASIT--Treatment of High-Yield
Interests."

If a Trust Fund fails to comply with one or more of ongoing requirements
for FASIT status during any taxable year, the Code provides that its FASIT
status may be lost for that year and thereafter. If FASIT status is lost,
the treatment of the former FASIT and interests therein for federal income
tax purposes is uncertain. Although the Code authorizes the Treasury to issue
regulations that address situations where a failure to meet the requirements
for FASIT status occurs inadvertently and in good faith, such regulations
have not yet been issued. It is possible that disqualification relief might
be accompanied by sanctions, such as the imposition of a corporate tax on all
or a portion of the FASIT's income for the period of time in which the
requirements for FASIT status are not satisfied.

Taxation of Regular Interest Certificates

Interest and Acquisition Discount. Certificates that qualify as regular
interests in a REMIC ("Regular Interest Certificates") are generally treated
as indebtedness for federal income tax purposes. Certificates representing
regular interests in a FASIT are treated as debt instruments. Certificates
designated as regular interests in a REMIC or a FASIT will be referred to
hereinafter collectively as "Regular Interest Certificates." Stated interest
on a Regular Interest Certificate will be taxable as ordinary income using
the accrual method of accounting, regardless of the Certificateholder's
normal accounting method. Reports will be made annually to the IRS and to
holders of Regular Interest Certificates that are not excepted from the
reporting requirements regarding amounts treated as interest (including
accrual of original issue discount) on Regular Interest Certificates.

Compound Interest Certificates, Interest Weighted Certificates, and Zero
Coupon Certificates will, and other Certificates constituting Regular
Interest Certificates may, be issued with "original issue discount" ("OID")
within the meaning of Code Section 1273. Rules governing original issue
discount are set forth in sections 1271-1275 of the Code and the Treasury
regulations thereunder (the "OID Regulations"). The OID Regulations do not
address the treatment of instruments having contingent payments. However,
Treasury regulations (the "Contingent Regulations") governing the treatment
of contingent payment obligations have recently been finalized. As described
more fully below, Code Section 1272(a)(6) requires the use of an income tax
accounting methodology that utilizes (i) a single constant yield to maturity
and (ii) the Prepayment Assumption. Under Section 1272(a)(6) of the Code,
special rules apply to the computation of OID on instruments, such as the
Regular Interest Certificates, on which principal is prepaid based on
prepayments of the underlying assets. Neither the OID Regulations nor the
Contingent Regulations contain rules applicable to instruments governed by
Section 1272(a)(6). Although technically not applicable to prepayable
securities, the Contingent Regulations may represent the likely method to be
applied in calculating OID on certain Classes of Certificates. Until the
Treasury issues guidance to the contrary, the Servicer or other person
responsible for computing the amount of original issue discount to be
reported to a Regular Interest Certificateholder each taxable year (the "Tax
Administrator") intends to base its computations on Code Section 1272(a)(6),
the OID Regulations and the Contingent Regulations as described below.
However, because no regulatory guidance currently exists under Code Section
1272(a)(6), there can be no assurance that the methodology described below
represents the correct manner of calculating original issue discount on the
Regular Interest Certificates.

In general, OID, if any, will equal the difference between the stated
redemption price at maturity of a Regular Interest Certificate and its issue
price. A holder of a Regular Interest Certificate must include such OID in
gross income as ordinary interest income as it accrues under a method taking
into account an economic accrual of the discount. In general, OID must be
included in income in advance of the receipt of the cash representing that
income. The amount of OID on a Regular Interest Certificate will be
considered to be zero if it is less than a de minimis amount determined under
the Code. However, the amount of any de minimis OID must be included in
income as principal payments are received on an Offered Certificate, in the
proportion that each such payment bears to the original principal balance of
the Certificate.

The issue price of a Regular Interest Certificate of a Class will
generally be the initial offering price at which a substantial amount of the
Certificates in the Class are sold, and will be treated by the Issuer as
including, in addition, the amount paid by the Certificateholder for accrued
interest that relates to a period prior to the Closing Date of such Regular
Interest Certificate. Under the OID Regulations, the stated redemption price
at maturity is the sum of all payments on the Security other than any
"qualified stated interest" payments. Qualified stated interest is defined as
any one of a series of payments equal to the product of the outstanding
principal balance of the Security and a single fixed rate, or certain
variable rates of interest that is unconditionally payable at least annually.
See "Variable Rate Certificates" below. In the case of the Compound Interest
Certificates, and certain of the other Regular Interest Certificates, none of
the payments under the instrument will be considered "qualified stated
interest," and thus the aggregate amount of all payments will be included in
the stated redemption price. For example, any securities upon which interest
can be deferred and added to principal ("Deferred Interest Certificates")
will not be "qualified stated interest." In addition, because Certificates
Owners are entitled to receive interest only to the extent that payments are
made on the Mortgage Loans, interest on all Regular Interest Certificates may
not be "unconditionally payable." In that case, all of the yield on a Regular
Interest Certificate will be taxed as OID, but interest would not then be
includible in income again when received. Unless otherwise specified in the
related Prospectus Supplement, the Issuer intends to take the position that
interest on the Regular Interest Certificates is "unconditionally payable."

The holder of a Regular Interest Certificate issued with OID must
include in gross income, for all days during its taxable year on which it
holds such Regular Interest Certificate, the sum of the "daily portions" of
such OID. Such daily portions are computed by allocating to each day during a
taxable year a pro rata portion of the OID that accrued during the relevant
accrual period. In the case of a debt instrument, subject to Section
1272(a)(6) of the Code, such as a Regular Interest Certificate, that is
subject to acceleration due to prepayments on other debt obligations securing
such instrument, OID is computed by taking into account the anticipated rate
of prepayments assumed in pricing the debt instrument (the "Prepayment
Assumption"). The amount of OID that will accrue during an accrual period
(generally the period between interest payments or compounding dates) is the
excess (if any) of (i) the sum of (a) the present value of all payments
remaining to be made on the Regular Interest Certificate as of the close of
the accrual period and (b) the payments during the accrual period of amounts
included in the stated redemption price of the Regular Interest Certificate,
over (ii) an "adjusted issue price" of the Regular Interest Security at the
beginning of the accrual period. The adjusted issue price of a Regular
Interest Certificate is the sum of its issue price plus prior accruals of
OID, reduced by the total payments made with respect to such Regular Interest
Certificate in all prior periods, other than qualified stated interest
payments. The present value of the remaining payments is determined on the
basis of three factors: (i) the original yield to maturity of the Regular
Interest Certificate (determined on the basis of compounding at the end of
each accrual period and properly adjusted for the length of the accrual
period), (ii) events which have occurred before the end of the accrual period
and (iii) the assumption that the remaining payments will be made in
accordance with the original Prepayment Assumption.

The effect of this method is to increase the portions of OID required to
be included in income by a Certificateholder to take into account prepayments
with respect to the Mortgage Loans at a rate that exceeds the Prepayment
Assumption, and to decrease (but not below zero for any period) the portions
of OID required to be included in income by a Certificateholder to take into
account prepayments with respect to the Mortgage Loans at a rate that is
slower than the Prepayment Assumption. Although original issue discount will
be reported to Certificateholders based on the Prepayment Assumption, no
representation is made to Certificateholders that Mortgage Loans will be
prepaid at that rate or at any other rate.

The Issuer may adjust the accrual of OID on a Class of Regular Interest
Certificates in a manner that it believes to be appropriate, to take account
of realized losses on the Mortgage Assets, although the OID Regulations do
not provide for such adjustments. If the Service challenges the method
adopted by the Issuer, the rate of accrual of OID for a Class of Regular
Interest Certificates could increase.

Certain classes of Regular Interest Certificates may represent more than
one class of REMIC regular interests or FASIT regular interests. Unless the
applicable Prospectus Supplement specifies otherwise, based on the OID
Regulations and solely for the purposes of computing OID, the Trustee intends
to calculate OID on such Regular Interest Certificates as if the separate
regular interests were a single debt instrument.

Certain Series of Certificates may represent regular interests ("Lower
Tier Interests") in other REMICs or FASITs. Unless otherwise provided in the
applicable Prospectus Supplement, based on the OID Regulations and solely for
the purposes of computing OID, the Trustee intends to calculate OID on such
certificates as if the separate regular interests were a single debt
instrument.

A holder of a Regular Interest Certificate, which acquires the Regular
Interest Certificate for an amount that exceeds its stated redemption price,
will not include any original issue discount in gross income. A subsequent
holder of a Regular Interest Certificate which acquires the Regular Interest
Certificate for an amount that is less than its stated redemption price, will
be required to include original issue discount in gross income, but such a
holder who purchases such Regular Interest Certificate for an amount that
exceeds its adjusted issue price will be entitled (as will an initial holder
who pays more than a Regular Interest Certificate's issue price) to offset
such original issue discount by comparable economic accruals of portions of
such excess.

Interest Weighted Certificates. It is not clear how income should be
accrued with respect to a Regular Interest Certificates the payments on which
consist solely or primarily of a specified portion of the interest payments
on qualified mortgages held by a REMIC or a FASIT ("Interest Weighted
Certificates"). Absent guidance to the contrary, the Issuer intends to take
the position that all of the income derived from Interest Weighted
Certificates should be treated as OID and that the amount and rate of accrual
of such OID should be calculated in the same manner as for a Compound
Interest Security. However, the Internal Revenue Service could assert that
income derived from an Interest Weighted Security should be calculated as if
the Interest Weighted Security were a bond purchased at a premium equal to
the excess of the price paid by such holder for the Interest Weighted
Security over its stated principal amount, if any. Under this approach, a
holder would be entitled to amortize such premium only if it has in effect an
election under Section 171 of the Code with respect to all taxable debt
instruments held by such holder, as described below. Alternatively, the
Internal Revenue Service could assert that the Interest Weighted Security
should be taxable under rules comparable to those governing bonds issued with
contingent principal payments or otherwise treated as contingent payment
instruments (although the Contingent Regulations explicitly do not apply to
REMIC regular interests). The OID Regulations do not, at the present time,
include regulations governing instruments that provide for contingent
payments. Under the Contingent Regulations, if they were applicable to
Interest Weighted Certificates (which, as Section 1272(a)(6) instruments, are
specifically excluded from the scope of the Contingent Regulations) income on
certain Certificates would be computed under the "noncontingent bond method."
The noncontingent bond method would generally apply in a manner similar to
the method prescribed by the Code under Section 1272(a)(6). See "- Variable
Rate Regular Certificates." Under the noncontingent bond method, however, if
the interest payable for any period is greater or less than the amount
projected, the amount of income included for that period would be either
increased or decreased accordingly. Any reduction in the income accrual for a
period below zero (a "Net Negative Adjustment") would be treated by a
Certificateholder as ordinary loss to the extent that prior income inclusions
exceed the total Net Negative Adjustments previously treated as ordinary loss
by the Certificateholder, and may be carried forward to offset future
interest accruals. At maturity, any remaining Net Negative Adjustment would
be treated as a loss on retirement of the Certificate. The legislative
history of relevant Code provisions indicates, however, that negative amount
of OID on an instrument such as a REMIC regular interest may not give rise to
taxable losses in any accrual period prior to the instrument's disposition or
retirement. Thus, it is not clear whether any losses resulting from a Net
Negative Adjustment may be recognized currently or must be carried forward
until disposition or retirement of the debt obligation.

Variable Rate Regular Certificates. Under the OID Regulations, the
amount and accrual of OID that qualifies for treatment under the rules
applicable to variable rate debt instruments (a "VRDI Security") is
determined, in general, by converting the VRDI Security into a hypothetical
fixed rate security and applying the rules applicable to fixed rate
securities described above to the hypothetical fixed rate security. A VRDI
Security providing for a qualified floating rate or rates or a qualified
inverse floating rate is converted to a hypothetical fixed rate security by
assuming that each qualified floating rate or the qualified inverse floating
rate will remain at its value as of the issue date. A VRDI Security providing
for an objective rate or rates is converted to a hypothetical fixed rate
security by assuming that each objective rate will equal a fixed rate that
reflects the yield that reasonably is expected for the instrument. Such
hypothetical fixed rate securities are assumed to have terms identical to
those provided under the related VRDI Certificates, except for a rate that
varies directly with an objective index. In the case of a VRDI Security that
does not provide for the payment of interest at least annually, appropriate
adjustments to the OID accruals and the qualified stated interest payments
are made in each accrual period to the extent that the interest actually
accrued or paid during the accrual period is greater or less than the
interest assumed to be accrued or paid under the hypothetical fixed rate
security.

Regular Interest Certificates of certain Series may provide for interest
based on a weighted average of the interest rates on some or all of the
Mortgage Loans of the related Trust ("Weighted Average Certificates"). Under
the OID Regulations, it appears that Weighted Average Certificates relating
to a Trust whose Mortgage Loans are exclusively ARM Loans bear interest at an
"objective rate," since the ARM Loans themselves bear interest at qualified
floating rates. Under the existing OID Regulations, Weighted Average
Certificates relating to a Trust whose Mortgage Loans are not exclusively ARM
Loans ("Non-Objective Weighted Average Certificates") do not bear interest at
an objective or a qualified floating rate and, consequently, are not governed
by the rules applicable to VRDI Certificates described above. Accordingly,
absent additional regulatory guidance, it appears that Non-Objective Weighted
Average Certificates would be taxed under the rules applicable to contingent
payment instruments. Under the Contingent Regulations, it appears that a
weighted average of fixed rates would qualify as an objective rate.

Effect of Defaults and Delinquencies. Each holder of a Regular Interest
Certificate will be required to accrue interest and original issue discount
on such Certificate without giving effect to any reductions in distributions
attributable to defaults or delinquencies on the Mortgage Loans, until it can
be established that any such reduction ultimately will not be recoverable. As
a result, the amount of taxable income reported in any period by the holder
of a Regular Interest Certificate could exceed the amount of economic income
actually realized by the holder in such period. Although the holder of a
Regular Interest Security eventually will recognize a loss or reduction in
income attributable to previously accrued and included income that, as a
result of such loss, ultimately will not be paid, the law is unclear with
respect to the timing and character of such losses or reduction in income.
Accordingly, holders of Regular Interest Certificates should consult their
own tax advisors on this point.

Under Section 166 of the Code, both corporate and noncorporate holders
of Regular Interest Certificates that hold such Certificates in connection
with a trade of business should be allowed to deduct, as ordinary losses, any
losses sustained during a taxable year in which their Regular Interest
Certificates become wholly or partially worthless as the result of one or
more realized losses on the Mortgage Loans. However, it appears that a
noncorporate holder that does not acquire a Regular Interest Security in
connection with a trade or business will not be entitled to deduct a loss
under Section 166 of the Code until such holder's Regular Interest Security
becomes wholly worthless (that is, until its outstanding principal balance
has been reduced to zero) and that the loss will be characterized as a short-
term capital loss.

Market Discount and Premium. A purchaser of a Regular Interest
Certificate may also be subject to the market discount rules of the Code.
Such purchaser generally will be required to recognize accrued market
discount as ordinary income as payments of principal are received on such
Regular Interest Certificate, or upon sale or exchange of the Regular
Interest Certificate. In general terms, until regulations are promulgated,
market discount may be treated as accruing, at the election of the holder,
either (i) under a constant yield method, taking into account the Prepayment
Assumption, or (ii) in proportion to accruals of original issue discount (or,
if there is no original issue discount, in proportion to accruals of stated
interest). A holder of a Regular Interest Certificate having market discount
may also be required to defer a portion of the interest deductions
attributable to any indebtedness incurred or continued to purchase or carry
the Regular Interest Certificate. As an alternative to the inclusion of
market discount in income on the foregoing basis, the holder may elect to
include such market discount in income currently as it accrues on all market
discount instruments acquired by such holder in that taxable year or
thereafter, in which case the interest deferral rule will not apply.

A holder who purchases a Regular Interest Certificate (other than an
Interest Weighted Security, to the extent described above) at a cost greater
than its stated redemption price at maturity, generally will be considered to
have purchased the Certificate at a premium, which it may elect to amortize
as an offset to interest income on such Certificate (and not as a separate
deduction item) on a constant yield method. Although no regulations
addressing the computation of premium accrual on collateralized mortgage
obligations or REMIC and FASIT regular interests have been issued, applicable
legislative history indicates that premium is to be accrued in the same
manner as market discount. Accordingly, it appears that the accrual of
premium on a Regular Interest Certificate will be calculated using the
prepayment assumption used in pricing such Regular Interest Certificate. If a
holder makes an election to amortize premium on a Certificate, such election
will apply to all taxable debt instruments (including all REMIC regular
interests) held by the holder at the beginning of the taxable year in which
the election is made, and to all taxable debt instruments acquired thereafter
by such holder, and will be irrevocable without the consent of the Internal
Revenue Service. Purchasers who pay a premium for the Regular Interest
Security should consult their tax advisers regarding the election to amortize
premium and the method to be employed.

The Regulations dealing with amortizable bond premium specifically do
not apply to prepayable debt instruments subject to Code Section 1272(a)(6)
such as the Certificates. Absent further guidance from the IRS, the Trustee
intends to account for amortizable bond premium in the manner described
above. Prospective purchasers of Certificates should consult their tax
advisors regarding the possible application of the Amortizable Bond Premium
Regulations.

Sale or Exchange of Regular Interest Certificates

A Regular Interest Certificateholder's tax basis in its Regular Interest
Certificates is the price such holder pays for a Certificate, increased by
amounts of original issue discount included in income and reduced by any
payments received (other than qualified periodic interest payments) and any
amortized premium. Gain or loss recognized on a sale, exchange, or redemption
of a Regular Interest Certificates, measured by the difference between the
amount realized and the Regular Interest Certificate's basis as so adjusted,
will generally be capital gain or loss, assuming that the Regular Interest
Certificate is held as a capital asset, except to the extent of (i) accrued
market discount and (ii) in the case of a redemption or prepayment of a
Regular Interest Certificate, any OID, including OID that did not previously
accrue. If, however, a Regular Certificateholder is a bank, thrift, or
similar institution described in Section 582 of the Code, gain or loss
realized on the sale or exchange of a Regular Interest Certificate will be
taxable as ordinary income or loss. In addition, gain from the disposition of
a Regular Interest Certificate that might otherwise be capital gain will be
treated as ordinary income to the extent of the excess, if any, of (i) the
amount that would have been includible in the holder's income if the yield on
such Regular Interest Certificate had equaled 110% of the applicable federal
rate as of the beginning of such holder's holding period, over (ii) the
amount of ordinary income actually recognized by the holder with respect to
such Regular Interest Certificate.

Taxation of the REMIC

General. Although a REMIC is a separate entity for federal income tax
purposes, a REMIC is not generally subject to entity-level tax. Rather, the
taxable income or net loss of a REMIC is taken into account by the holders of
residual interests. The regular interests are generally taxable as debt of
the REMIC.

Calculation of REMIC Income. The taxable income or net loss of a REMIC
is determined under an accrual method of accounting and in the same manner as
in the case of an individual, with certain adjustments. In general, the
taxable income or net loss will be the difference between (i) the gross
income produced by the REMIC's assets, including stated interest and any
original issue discount or market discount on loans and other assets, and
(ii) deductions, including stated interest and original issue discount
accrued on a Regular Interest Security, amortization of any premium with
respect to loans, and servicing fees and other expenses of the REMIC. A
holder of a Residual Interest Security that is an individual or a "pass-
through interest holder" (including certain pass-through entities, but not
including real estate investment trusts) will be unable to deduct servicing
fees payable on the loans or other administrative expenses of the REMIC for a
given taxable year, to the extent that such expenses, when aggregated with
the Residual Interest Securityholder's other miscellaneous itemized
deductions for that year, do not exceed two percent of such holder's adjusted
gross income. In addition, Code Section 68 provides that the amount of
itemized deductions otherwise allowable for the taxable year for an
individual whose adjusted gross income exceeds the applicable amount will be
reduced by the lesser of (i) 3% of the excess of adjusted gross income over
the applicable amount, or (ii) 80% of the amount of itemized deductions
otherwise allowable for such taxable year. See "REMIC Expenses" below.

For purposes of computing its taxable income or net loss, the REMIC
should have an initial aggregate tax basis in its assets equal to the
aggregate fair market value of the regular interests and the residual
interests on the Start Up Day (generally, the day that the interests are
issued). That aggregate basis will be allocated among the assets of the REMIC
in proportion to their respective fair market values.

The original issue discount provisions of the Code apply to loans of
individuals originated on or after March 2, 1984, and the market discount
provisions apply to all loans. Subject to possible application of the de
minimis rules, the method of accrual by the REMIC of original issue discount
on such loans will be equivalent to the method under which holders of Regular
Interest Certificates accrue original issue discount (i.e., under the
constant yield method taking into account the Prepayment Assumption). The
REMIC will deduct original issue discount on the Regular Interest
Certificates in the same manner that the holders of the Certificates include
such discount in income, but without regard to the de minimis rules. See
"Taxation of Regular Interest Certificates" above. However, a REMIC that
acquires loans at a market discount must include such market discount in
income currently, as it accrues, on a constant interest basis.

To the extent that the REMIC's basis allocable to loans that it holds
exceeds their principal amounts, the resulting premium, if attributable to
mortgages originated after September 27, 1985, will be amortized over the
life of the loans (taking into account the Prepayment Assumption) on a
constant yield method. Although the law is somewhat unclear regarding
recovery of premium attributable to loans originated on or before such date,
it is possible that such premium may be recovered in proportion to payments
of loan principal.

Income from Foreclosure Property. To the extent that a REMIC derives
income from Foreclosed Properties that is treated as "net income from
foreclosure property," that income will be subject to taxation at the highest
corporate tax rate. Net income from foreclosure property generally includes
gain from the sale of a foreclosure property that is inventory property and
net income from the property that would not be treated as "rents from real
property" or other certain other qualifying income. In addition, if the
operation of the Foreclosed Property is treated as a trade or business
carried on by the REMIC, then unless the property is operated through an
independent contractor, the income from the foreclosed property will be
subject to tax on "income from nonpermitted assets" at a rate of 100%. A
trust agreement or indenture may permit the Servicer to operate a Foreclosed
Property in a manner that produces income subject to the foregoing taxes if
certain conditions are satisfied.

Prohibited Transactions and Contributions Tax. The REMIC will be
subject to a 100% tax on any net income derived from a "prohibited
transaction." For this purpose, net income will be calculated without taking
into account any losses from other prohibited transactions or any deductions
attributable to any prohibited transaction that resulted in a loss. In
general, prohibited transactions include (i) subject to limited exceptions,
the sale or other disposition of any qualified mortgage transferred to the
REMIC; (ii) subject to a limited exception, the sale or other disposition of
a cash flow investment; (iii) the receipt of any income from assets not
permitted to be held by the REMIC pursuant to the Code; or (iv) the receipt
of any fees or other compensation for services rendered by the REMIC. It is
anticipated that a REMIC will not engage in any prohibited transactions in
which it would recognize a material amount of net income. In addition,
subject to a number of exceptions, a tax is imposed at the rate of 100% on
amounts contributed to a REMIC after the close of the three-month period
beginning on the Start Up Day. The holders of Residual Interest Certificates
will generally be responsible for the payment of any such taxes imposed on
the REMIC. To the extent not paid by such Holders or otherwise, however, such
taxes will be paid out of the assets of the REMIC and, unless otherwise
specified in the related Prospectus Supplement, will be allocated pro rata to
all outstanding Classes of Certificates of such REMIC.

Taxation of Holders of Residual Interest Certificates

The Holder of a Certificate representing a REMIC residual interest (a
"Residual Interest Certificate") will take into account the "daily portion"
of the taxable income or net loss of the REMIC for each day during the
taxable year on which such holder held the Residual Interest Security. The
daily portion is determined by allocating to each day in any calendar quarter
its ratable portion of the taxable income or net loss of the REMIC for such
quarter, and by allocating that amount among the holders (on such day) of the
Residual Interest Certificates in proportion to their respective holdings on
such day.

The holder of a Residual Interest Certificate must report its
proportionate share of the taxable income of the REMIC whether or not it
receives cash distributions from the REMIC attributable to such income or
loss. The reporting of taxable income without corresponding distributions
could occur, for example, in certain REMIC issues in which the loans held by
the REMIC were issued or acquired at a discount, since mortgage prepayments
cause recognition of discount income, while the corresponding portion of the
prepayment could be used in whole or in part to make principal payments on
Regular Interest Certificates issued without any discount or at an
insubstantial discount. (If this occurs, it is likely that cash distributions
will exceed taxable income in later years.) Taxable income may also be
greater in earlier years of certain REMIC issues as a result of the fact that
interest expense deductions, as a percentage of outstanding principal on
Regular Interest Certificates, will typically increase over time as lower
yielding Certificates are paid, whereas interest income with respect to loans
will generally remain constant over time as a percentage of loan principal.

In any event, because the holder of a residual interest is taxed on the
net income of the REMIC, the taxable income derived from a Residual Interest
Certificate in a given taxable year will not be equal to the taxable income
associated with investment in a corporate bond or stripped instrument having
similar cash flow characteristics and pretax yield. Therefore, the after-tax
yield on the Residual Interest Security may be less than that of such a bond
or instrument.

Limitation on Losses. The amount of the REMIC's net loss that a holder
may take into account currently is limited to the holder's adjusted basis at
the end of the calendar quarter in which such loss arises. A holder's basis
in a Residual Interest Certificate will initially equal such holder's
purchase price, and will subsequently be increased by the amount of the
REMIC's taxable income allocated to the holder, and decreased (but not below
zero) by the amount of distributions made and the amount of the REMIC's net
loss allocated to the holder. Any disallowed loss may be carried forward
indefinitely, but may be used only to offset income generated by the same
REMIC. The ability of Residual Certificateholders to deduct net losses may be
subject to additional limitations under the Code, as to which such holders
should consult their tax advisers.

Distributions. Distributions on a Residual Interest Certificate
(whether at their scheduled times or as a result of prepayments) will
generally not result in any additional taxable income or loss to a holder of
a Residual Interest Certificate. If the amount of such payment exceeds a
holder's adjusted basis in the Residual Interest Certificate, however, the
holder will recognize gain (treated as gain from the sale of the Residual
Interest Certificate) to the extent of such excess.

Mark-to-Market Rules. A residual interest in a REMIC, or an interest or
arrangement that is determined by the Commissioner to have substantially the
same effect, is not a "security" for purposes of the mark-to-market rules and
accordingly is not eligible to be marked to market.

Sale or Exchange. A holder of a Residual Interest Certificate will
recognize gain or loss on the sale or exchange of a Residual Certificate
equal to the difference, if any, between the amount realized and such
Certificateholder's adjusted basis in the Residual Interest Certificate at
the time of such sale or exchange. Except to the extent provided in
regulations, which have not yet been issued, any loss upon disposition of a
Residual Interest Certificate will be disallowed if the selling
Certificateholder acquires any residual interest in a REMIC or similar
mortgage pool within six months before or after such disposition.

Excess Inclusion Income. The portion of a Residual
Certificateholder's REMIC taxable income consisting of "excess exclusion"
income may not be offset by other deductions or losses, including net
operating losses, on such Certificateholder's federal income tax return.
Further, if the holder of a Residual Interest Certificate is an organization
subject to the tax on unrelated business income imposed by Code Section 511,
such Residual Certificateholder's excess inclusion income will be treated as
unrelated business taxable income of such Certificateholders. In addition,
under Treasury regulations yet to be issued, if a real estate investment
trust, a regulated investment company, a common trust fund, or certain
cooperatives were to own a Residual Interest Certificate, a portion of
dividends (or other distributions) paid by the real estate investment trust
(or other entity) would be treated as excess inclusion income. If a Residual
Interest Certificate is owned by a foreign person, excess inclusion income is
subject to tax at a rate of 30% which may not be reduced by treaty and is not
eligible for treatment as "portfolio interest."

The excess inclusion portion of a REMIC's income is generally equal to
the excess, if any, of REMIC taxable income for the quarterly period
allocable to a Residual Interest Certificate, over the daily accruals for
such quarterly period of (i) 120% of the long term applicable federal rate on
the Start Up Day multiplied by (ii) the adjusted issue price of such Residual
Interest Certificate at the beginning of such quarterly period. The adjusted
issue price of a Residual Interest Certificate at the beginning of each
calendar quarter will equal its issue price (calculated in a manner analogous
to the determination of the issue price of a Regular Interest Certificate),
increased by the aggregate of the daily accruals for prior calendar quarters,
and decreased (but not below zero) by the amount of loss allocated to a
holder and the amount of distributions made on the Residual Interest
Certificate before the beginning of the quarter. The long-term federal rate,
which is announced monthly by the Treasury Department, is an interest rate
that is based on the average market yield of outstanding marketable
obligations of the United States government having remaining maturities in
excess of nine years.

The Small Business Job Protection Act of 1996 has eliminated the special
rule permitting Section 593 institutions ("thrift institutions") to use net
operating losses and other allowable deductions to offset their excess
inclusion income from REMIC residual certificates that have "significant
value" within the meaning of the REMIC Regulations, effective for taxable
years beginning after December 31, 1995, except with respect to residual
certificates continuously held by a thrift institution since November 1,
1995.

In addition, the Small Business Job Protection Act of 1996 provides
three rules for determining the effect of excess inclusions on the
alternative minimum taxable income of a residual holder. First, alternative
minimum taxable income for such residual holder is determined without regard
to the special rule that taxable income cannot be less than excess
inclusions. Second, a residual holder's alternative minimum taxable income
for a tax year cannot be less than the excess inclusions for the year.
Third, the amount of any alternative minimum tax net operating loss
deductions must be computed without regard to any excess inclusions. These
rules are effective for tax years beginning after December 31, 1986, unless a
residual holder elects to have such rules apply only to tax years beginning
after August 20, 1996.

Under the REMIC Regulations, in certain circumstances, transfers of
Residual Interest Certificates may be disregarded. See "Restrictions on
Ownership and Transfer of Residual Interest Certificates" and "Tax Treatment
of Foreign Investors" below.

Restrictions on Ownership and Transfer of REMIC Residual Interest
Certificates

As a condition to qualification as a REMIC, reasonable arrangements must
be made to prevent the ownership of a REMIC residual interest by any
"Disqualified Organization." Disqualified Organizations include the United
States, any State or political subdivision thereof, any foreign government,
any international organization, or any agency or instrumentality of any of
the foregoing, a rural electric or telephone cooperative described in Section
1381(a)(2)(C) of the Code, or any entity exempt from the tax imposed by
Sections 1-1399 of the Code, if such entity is not subject to tax on its
unrelated business income. Accordingly, the Indenture or Trust Agreement, as
applicable, will prohibit Disqualified Organizations from owning a Residual
Interest Security. In addition, no transfer of a Residual Interest Security
will be permitted unless the proposed transferee shall have furnished to the
Issuer an affidavit representing and warranting that it is neither a
Disqualified Organization nor an agent or nominee acting on behalf of a
Disqualified Organization.

If a Residual Interest Security is transferred to a Disqualified
Organization (in violation of the restrictions set forth above), a
substantial tax will be imposed on the transferor of such Residual Interest
Security at the time of the transfer. In addition, if a Disqualified
Organization holds an interest in a pass-through entity (including, among
others, a partnership, trust, real estate investment trust, regulated
investment company, or any person holding as nominee), that owns a Residual
Interest Security, the pass-through entity will be required to pay an annual
tax on its allocable share of the excess inclusion income of the REMIC.

Under the REMIC Regulations, if a Residual Interest Security is a
"noneconomic residual interest," as described below, a transfer of a Residual
Interest Security to a United States person will be disregarded for all
Federal tax purposes unless no significant purpose of the transfer was to
impede the assessment or collection of tax. A Residual Interest Security is a
"noneconomic residual interest" unless, at the time of the transfer (i) the
present value of the expected future distributions on the Residual Interest
Security at least equals the product of the present value of the anticipated
excess inclusions and the highest rate of tax for the year in which the
transfer occurs, and (ii) the transferor reasonably expects that the
transferee will receive distributions from the REMIC at or after the time at
which the taxes accrue on the anticipated excess inclusions in an amount
sufficient to satisfy the accrued taxes. The present value is calculated
based on the Prepayment Assumption, using a discount rate equal to the
"applicable federal rate" at the time of transfer. If a transfer of a
residual interest is disregarded, the transferor would be liable for any
Federal income tax imposed upon taxable income derived by the transferee from
the REMIC. A significant purpose to impede the assessment or collection of
tax exists if the transferor, at the time of transfer, knew or should have
known that the transferee would be unwilling or unable to pay taxes on its
share of the taxable income of the REMIC. A similar limitation exists with
respect to certain transfers of residual interests by foreign persons to
United States persons. See "Tax Treatment of Foreign Investors" below.

REMIC Expenses

As a general rule, all of the expenses of a REMIC will be taken into
account by holders of the Residual Interest Certificates or the REMIC
residual interest. In the case of a "single class REMIC," however, the
expenses will be allocated, under temporary Treasury regulations, among the
holders of the Regular Interest Certificates and the holders of the Residual
Interest Certificates on a daily basis in proportion to the relative amounts
of income accruing to each Certificateholder on that day. In the case of a
holder of a Regular Interest Certificate who is an individual or a "pass-
through interest holder" (including certain pass-through entities but not
including real estate investment trusts), such expenses will be deductible
only to the extent that such expenses, plus other "miscellaneous itemized
deductions" of the Certificateholder exceed 2% of such Bondholder's or
Certificateholder's adjusted gross income and will not be deductible in
computing alternative minimum taxable income. In addition, Code Section 68
provides that the amount of itemized deductions otherwise allowable for the
taxable year for an individual whose adjusted gross income exceeds the
applicable amount will be reduced by the lesser of (i) 3% of the excess of
adjusted gross income over the applicable amount, or (ii) 80% of the amount
of itemized deductions otherwise allowable for such taxable year. The
disallowance of this deduction may have a significant impact on the yield of
the Regular Interest Certificate to such a holder. In general terms, a single
class REMIC is one that either (i) would qualify, under existing Treasury
regulations, as a grantor trust if it were not a REMIC (treating all
interests as ownership interests, even if they would be classified as debt
for federal income tax purposes) or (ii) is similar to such a trust and which
is structured with the principal purpose of avoiding the single class REMIC
rules.

Administrative Matters

The REMIC's books must be maintained on a calendar year basis and the
REMIC must file an annual federal income tax return. The REMIC will also be
subject to the procedural and administrative rules of the Code applicable to
partnerships, including the determination of any adjustments to, among other
things, items of REMIC income, gain, loss, deduction, or credit, by the
Internal Revenue Service in a unified administrative proceeding.

Taxation of Holders of FASIT High-Yield Interests

FASIT High-Yield Interests are subject to special rules regarding the
eligibility of holders of such interest, and the ability of such holders to
offset income derived from those interests with losses. High-Yield Interests
only may be held by Eligible Corporations, other FASITs, and dealers in
securities who acquire such interests as inventory. If a securities dealer
(other than an Eligible Corporation) initially acquires a High-Yield Interest
as inventory, but later begins to hold it for investment, the dealer will be
subject to an excise tax equal to the income from the High-Yield Interest
multiplied by the highest corporate income tax rate. In addition, transfers
of High-Yield Interests to disqualified holders will be disregarded for
federal income tax purposes, and the transferor will continue to be treated
as the holder of the High-Yield Interest.

The Holder of a High-Yield Interest may not use non-FASIT current losses
or net operating loss carryforwards or carrybacks to offset any income
derived from the High-Yield Interest, for either regular federal income tax
purposes or for alternative minimum tax purposes. In addition, the FASIT
provisions contain an anti-abuse rule that imposes corporate income tax on
income derived from a FASIT regular interest that is held by a pass-through
entity (other than another FASIT) that issues debt or equity securities
backed by the FASIT regular interest and that have the same features as High-
Yield Interests.

Taxation of Holders of FASIT Ownership Interests

A FASIT ownership interest represents the residual equity interest in a
FASIT. As such, the holder of a FASIT ownership interest determines its
taxable income by taking into account all assets, liabilities, and items of
income, gain, deduction, loss and credit of a FASIT. In general, the
character of the income to the holder of a FASIT ownership interest will be
the same as the character of such income to the FASIT, except that any tax-
exempt interest income taken into account by the holder of a FASIT ownership
interest is treated as ordinary income. In determining that taxable income,
the holder of a FASIT ownership interest must determine the amount of
interest, original issue discount, market discount, and premium recognized
with respect to the FASIT's assets and the FASIT regular interests issued by
the FASIT according to a constant yield methodology and under an accrual
method of accounting. In addition, holders of FASIT Ownership Securities are
subject to the same limitations on their ability to use losses to offset
income from their FASIT regular interests as are holders of High-Yield
Interest.

Rules similar to the wash sale rules applicable to REMIC residual
interests also will apply to FASIT ownership interests. Accordingly, losses
on dispositions of a FASIT ownership interest generally will be disallowed
where within six months before or after the disposition, the seller of such
interest acquires any other FASIT ownership interest that is economically
comparable to a FASIT ownership interest. In addition, if any security that
is sold or contributed to a FASIT by the holders of the related FASIT
ownership interest was required to be marked-to-market under section 475 of
the Code by such holder, then section 475 of the Code will continue to apply
to such securities, except that the amount realized under the mark-to-market
rules or the securities' value after applying special valuation rules
contained in the FASIT provisions. Those special valuation rules generally
require that the value of debt instruments that are not traded on an
established securities market be determined by calculating the present value
of the reasonably expected payments under the instrument using a discount
rate of 120% of the applicable Federal rate, compounded semi-annually.

The holder of a FASIT ownership interest will be subject to a tax equal
to 100% of the net income derived by the FASIT from any "prohibited
transactions." Prohibited transactions include (i) the receipt of income
derived from assets that are not permitted assets, (ii) certain dispositions
of permitted assets, (iii) the receipt of any income derived from any loan
originated by a FASIT, and (iv) in certain cases, the receipt of income
representing a servicing fee or other compensation. Any Series of Securities
for which a FASIT election is made generally will be structured in order to
avoid application of the prohibited transaction tax.

Tax Status as a Grantor Trust

General. If the applicable Prospectus Supplement so specifies with
respect to a Series of Certificates, the Certificates of such Series will not
be treated as regular or residual interests in a REMIC for federal income tax
purposes but instead will be treated as an undivided beneficial ownership
interest in the Mortgage Loans and the arrangement pursuant to which the
Mortgage Loans will be held and the Certificates will be issued, will be
classified for federal income tax purposes as a grantor trust under Subpart
E, Part 1 of Subchapter J of the Code and not as an association taxable as a
corporation. In such a case, special counsel to the Issuer will deliver its
opinion to the effect that the arrangement by which the Certificates of that
Series are issued will be treated as a grantor trust as long as all of the
provisions of the applicable Trust Agreement are complied with and the
statutory and regulatory requirements are satisfied. In some Series ("Pass-
Through Certificates"), there will be no separation of the principal and
interest payments on the Mortgage Loans. In such circumstances, a
Certificateholder will be considered to have purchased an undivided interest
in each of the Mortgage Loans. In other cases ("Stripped Certificates"), sale
of the Certificates will produce a separation in the ownership of the
principal payments and interest payments on the Mortgage Loans.

Each Certificateholder must report on its federal income tax return its
pro rata share of the gross income derived from the Mortgage Loans (not
reduced by the amount payable as fees to the Trustee and the Master Servicer
and similar fees (collectively, the "Servicing Fee")), at the same time and
in the same manner as such items would have been reported under the
Certificateholder's tax accounting method had it held its interest in the
Mortgage Loans directly, received directly its share of the amounts received
with respect to the Mortgage Loans, and paid directly its share of the
Servicing Fees. In the case of Pass-Through Certificates, such gross income
will consist of a pro rata share of all of the income derived from all of the
Mortgage Loans and, in the case of Stripped Certificates, such income will
consist of a pro rata share of the income derived from each stripped bond or
stripped coupon in which the Certificateholder owns an interest. The holder
of a Certificate will generally be entitled to deduct such Servicing Fees
under Section 162 or Section 212 of the Code to the extent that such
Servicing Fees represent "reasonable" compensation for the services rendered
by the Trustee and the Master Servicer (and Servicer, if other than the
Master Servicer). In the case of a noncorporate holder, however, Servicing
Fees (to the extent not otherwise disallowed, e.g., because they exceed
reasonable compensation) will be deductible in computing such holder's
regular tax liability only to the extent that such fees, when added to other
miscellaneous itemized deductions, exceed 2% of adjusted gross income and may
not be deductible to any extent in computing such holder's alternative
minimum tax liability. In addition, Code Section 68 provides that the amount
of itemized deductions otherwise allowable for the taxable year for an
individual whose adjusted gross income exceeds the applicable amount will be
reduced by the lesser of (i) 3% of the excess of adjusted gross income over
the applicable amount, or (ii) 80% of the amount of itemized deductions
otherwise allowable for such taxable year.

Discount or Premium on Pass-Through Certificates. The holder's purchase
price of a Pass-Through Certificate is to be allocated among the Mortgage
Loans in proportion to their fair market values, determined as of the time of
purchase of the Certificates. In the typical case, the Trustee believes it is
reasonable for this purpose to treat each Mortgage Loan as having a fair
market value proportional to the share of the aggregate principal balances of
all of the Mortgage Loans that it represents, since the Mortgage Loans,
unless otherwise specified in the applicable Prospectus Supplement, will have
a relatively uniform interest rate and other common characteristics. To the
extent that the portion of the purchase price of a Certificate allocated to a
Mortgage Loan (other than to a right to receive any accrued interest thereon
and any undistributed principal payments) is less than or greater than the
portion of the principal balance of the Mortgage Loan allocable to the
Certificate, the interest in the Mortgage Loan allocable to the Certificate
will be deemed to have been acquired at a discount or premium, respectively.

The treatment of any discount will depend on whether the discount
represents original issue discount or market discount. In the case of a
Mortgage Loan with original issue discount in excess of a prescribed de
minimis amount, a holder of a Certificate will be required to report as
interest income in each taxable year its share of the amount of original
issue discount that accrues during that year, determined under a constant
yield method by reference to the initial yield to maturity of the Mortgage
Loan, in advance of receipt of the cash attributable to such income and
regardless of the method of federal income tax accounting employed by that
holder. Original issue discount with respect to a Mortgage Loan could arise
for example by virtue of the financing of points by the originator of the
Mortgage Loan, or by virtue of the charging of points by the originator of
the Mortgage Loan in an amount greater than a statutory de minimis exception,
in circumstances under which the points are not currently deductible pursuant
to applicable Code provisions. However, the OID Regulations provide that if a
holder acquires an obligation at a price that exceeds its stated redemption
price, the holder will not include any original issue discount in gross
income. In addition, if a subsequent holder acquires an obligation for an
amount that exceeds its adjusted issue price the subsequent holder will be
entitled to offset the original issue discount with economic accruals of
portions of such excess. Accordingly, if the Mortgage Loans acquired by a
Certificateholder are purchased at a price that exceeds the adjusted issue
price of such Mortgage Loans, any original issue discount will be reduced or
eliminated.

Certificateholders also may be subject to the market discount rules of
Sections 1276-1278 of the Code. A Certificateholder that acquires an interest
in Mortgage Loans with more than a prescribed de minimis amount of "market
discount" (generally, the excess of the principal amount of the Mortgage
Loans over the purchaser's purchase price) will be required under Section
1276 of the Code to include accrued market discount in income as ordinary
income in each month, but limited to an amount not exceeding the principal
payments on the Mortgage Loans received in that month and, if the
Certificates are sold, the gain realized. Such market discount would accrue
in a manner to be provided in Treasury regulations. The legislative history
of the 1986 Act indicates that, until such regulations are issued, such
market discount would in general accrue either (i) on the basis of a constant
interest rate or (ii) in the ratio of (a) in the case of Mortgage Loans not
originally issued with original issue discount, stated interest payable in
the relevant period to total stated interest remaining to be paid at the
beginning of the period or (b) in the case of Mortgage Loans originally
issued at a discount, original issue discount in the relevant period to total
original issue discount remaining to be paid.

Section 1277 of the Code provides that the excess of interest paid or
accrued to purchase or carry a loan with market discount over interest
received on such loan is allowed as a current deduction only to the extent
such excess is greater than the market discount that accrued during the
taxable year in which such interest expense was incurred. In general, the
deferred portion of any interest expense will be deductible when such market
discount is included in income, including upon the sale, disposition, or
repayment of the loan. A holder may elect to include market discount in
income currently as it accrues, on all market discount obligations acquired
by such holder during the taxable year such election is made and thereafter,
in which case the interest deferral rule discussed above will not apply.

A Certificateholder who purchases a Certificate at a premium generally
will be deemed to have purchased its interest in the underlying Mortgage
Loans at a premium. A Certificateholder who holds a Certificate as a capital
asset may generally elect under Section 171 of the Code to amortize such
premium as an offset to interest income on the Mortgage Loans (and not as a
separate deduction item) on a constant yield method. The legislative history
of the 1986 Act suggests that the same rules that will apply to the accrual
of market discount (described above) will generally also apply in amortizing
premium with respect to Mortgage Loans originated after September 27, 1985.
If a holder makes an election to amortize premium, such election will apply
to all taxable debt instruments held by such holder at the beginning of the
taxable year in which the election is made, and to all taxable debt
instruments acquired thereafter by such holder, and will be irrevocable
without the consent of the Internal Revenue Service. Purchasers who pay a
premium for the Certificates should consult their tax advisers regarding the
election to amortize premium and the method to be employed. Although the law
is somewhat unclear regarding recovery of premium allocable to Mortgage Loans
originated before September 28, 1985, it is possible that such premium may be
recovered in proportion to payments of Mortgage Loan principal.

Discount or Premium on Stripped Certificates. A Stripped Certificate
may represent a right to receive only a portion of the interest payments on
the Mortgage Loans, a right to receive only principal payments on the
Mortgage Loans, or a right to receive certain payments of both interest and
principal. Certain Stripped Certificated ("Ratio Strip Certificates") may
represent a right to receive differing percentages of both the interest and
principal on each Mortgage Loan. Pursuant to Section 1286 of the Code, the
separation of ownership of the right to receive some or all of the interest
payments on an obligation from ownership of the right to receive some or all
of the principal payments results in the creation of "stripped bonds" with
respect to principal payments and "stripped coupons" with respect to interest
payments. Section 1286 of the Code applies the original issue discount rules
to stripped bonds and stripped coupons. For purposes of computing original
issue discount, a stripped bond or a stripped coupon is treated as a debt
instrument issued on the date that such stripped interest is purchased with
an issue price equal to its purchase price or, if more than one stripped
interest is purchased, the ratable share of the purchase price allocable to
such stripped interest. The Code, the OID Regulations, and judicial decisions
provide no direct guidance as to how the interest and original issue discount
rules are to apply to Stripped Certificates. Under the method described above
for REMIC Regular Interest Certificates (the "Cash Flow Bond Method"), a
prepayment assumption is used and periodic recalculations are made which take
into account with respect to each accrual period the effect of prepayments
during such period. The 1986 Act prescribed the same method for debt
instruments "secured by" other debt instruments, the maturity of which may be
affected by prepayments on the underlying debt instruments. However, the 1986
Act does not, absent Treasury regulations, appear specifically to cover
instruments such as the Stripped Certificates which technically represent
ownership interests in the underlying Mortgage Loans, rather than being debt
instruments "secured by" those loans. Nevertheless, it is believed that the
Cash Flow Bond Method is a reasonable method of reporting income for such
Certificates, and it is expected that original issue discount will be
reported on that basis. In applying the calculation to such Certificates, the
Trustee will treat all payments to be received with respect to the
Certificates, whether attributable to principal or interest on the loans, as
payments on a single installment obligation and as includible in the stated
redemption price at maturity. The IRS could, however, assert that original
issue discount must be calculated separately for each Mortgage Loan
underlying a Certificate. In addition, in the case of Ratio Strip
Certificates, the Internal Revenue Service could assert that original issue
discount must be calculated separately for each stripped coupon or stripped
bond underlying a Certificate.

Under certain circumstances, if the Mortgage Loans prepay at a rate
faster than the Prepayment Assumption, the use of the Cash Flow Bond Method
may accelerate a Certificateholder's recognition of income. If, however, the
Mortgage Loans prepay at a rate slower than the prepayment assumption, in
some circumstances the use of this method may decelerate a
Certificateholder's recognition of income.

In the case of a Stripped Certificate which either embodies only
interest payments on the underlying loans or (if it embodies some principal
payments on the Mortgage Loans) is issued at a price that exceeds the
principal payments (an "Interest Weighted Certificate"), the Trustee intends,
absent contrary authority, to report income to Certificateholders as OID, in
the manner described above in "--Interest Weighted Certificates".

Possible Alternative Characterizations. The characterizations of the
Stripped Certificates described above are not the only possible
interpretations of the applicable Code provisions. Among other possibilities,
the Internal Revenue Service could contend that (i) in certain Series, each
non-Interest Weighted Certificate is composed of an unstripped undivided
ownership interest in Loans and an installment obligation consisting of
stripped principal payments; (ii) the non-Interest Weighted Certificates are
subject to the Proposed Regulations; (iii) each Interest Weighted Certificate
is composed of an unstripped undivided ownership interest in the Mortgage
Loans and an installment obligation consisting of stripped interest payments;
or (iv) there are as many stripped bonds or stripped coupons as there are
scheduled payments of principal and/or interest on each Mortgage Loan.

Given the variety of alternatives for treatment of the Certificates and
the different federal income tax consequences that result from each
alternative, potential purchasers are urged to consult their own tax advisers
regarding the proper treatment of the Certificates for federal income tax
purposes.

Character as Qualifying Mortgage Loans. In the case of Stripped
Certificates there is no specific legal authority existing regarding whether
the character of the Certificates, for federal income tax purposes, will be
the same as the Mortgage Loans. The IRS could take the position that the
Mortgage Loans' character is not carried over to the Certificates in such
circumstances. Pass-Through Certificates will be, and, although the matter is
not free from doubt, Stripped Certificates should be considered to represent
"real estate assets" within the meaning of Section 856(c)(6)(B) of the Code,
and "loans secured by an interest in real property" within the meaning of
Section 7701(a)(19)(C)(v) of the Code and interest income attributable to the
Certificates should be considered to represent "interest on obligations
secured by mortgages on real property or on interests in real property"
within the meaning of Section 856(c)(3)(B) of the Code. However, Mortgage
Loans secured by non-residential real property will not constitute "loans
secured by an interest in real property" within the meaning of Section
7701(a)(19)(C) of the Code. In addition, it is possible that various reserves
or funds underlying the Certificates may cause a proportionate reduction in
the above-described qualifying status categories of Certificates.

Sale of Certificates. As a general rule, if a Certificate is sold, gain
or loss will be recognized by the holder thereof in an amount equal to the
difference between the amount realized on the sale and the
Certificateholder's adjusted tax basis in the Certificate. Such gain or loss
will generally be capital gain or loss if the Certificate is held as a
capital asset. In the case of Pass-Through Certificates, such tax basis will
generally equal the holder's cost of the Certificate increased by any
discount income with respect to the loans represented by such Certificate
previously included in income, and decreased by the amount of any
distributions of principal previously received with respect to the
Certificate. Such gain, to the extent not otherwise treated as ordinary
income, will be treated as ordinary income to the extent of any accrued
market discount not previously reported as income. In the case of Stripped
Certificates, the tax basis will generally equal the Certificateholder's cost
for the Certificate, increased by any discount income with respect to the
Certificate previously included in income, and decreased by the amount of all
payments previously received with respect to such Certificate.

Miscellaneous Tax Aspects

Backup Withholding. A Bondholder or Certificateholder, other than a
Residual Bondholder or Residual Certificateholder, may, under certain
circumstances, be subject to "backup withholding" at the rate of 31% with
respect to distributions or the proceeds of a sale of certificates to or
through brokers that represent interest or original issue discount on the
Certificates. This withholding generally applies if the holder of a
Certificate (i) fails to furnish the Issuer with its taxpayer identification
number ("TIN"); (ii) furnishes the Issuer an incorrect TIN; (iii) fails to
report properly interest, dividends or other "reportable payments" as defined
in the Code; or (iv) under certain circumstances, fails to provide the Issuer
or such holder's securities broker with a certified statement, signed under
penalty of perjury, that the TIN provided is its correct number and that the
holder is not subject to backup withholding. Backup withholding will not
apply, however, with respect to certain payments made to Bondholders or
Certificateholders, including payments to certain exempt recipients (such as
exempt organizations) and to certain Nonresidents (as defined below). Holders
of the Certificates should consult their tax advisers as to their
qualification for exemption from backup withholding and the procedure for
obtaining the exemption.

The Issuer will report to the Certificateholders and to the Internal
Revenue Service for each calendar year the amount of any "reportable
payments" during such year and the amount of tax withheld, if any, with
respect to payments on the Certificates.

Tax Treatment of Foreign Investors

Under the Code, unless interest (including OID) paid on a Security
(other than a Residual Interest Security) is considered to be "effectively
connected" with a trade or business conducted in the United States by a
nonresident alien individual, foreign partnership or foreign corporation
("Nonresidents"), such interest will normally qualify as portfolio interest
(except where (i) the recipient is a holder, directly or by attribution, of
10% or more of the capital or profits interest in the Issuer or (ii) the
recipient is a controlled foreign corporation to which the Issuer is a
related person) and will be exempt from federal income tax. Upon receipt of
appropriate ownership statements, the Issuer normally will be relieved of the
obligation to withhold federal income tax from such interest payments. These
provisions supersede the generally applicable provisions of United States law
that would otherwise require the Issuer to withhold at a 30% rate (unless
such rate were reduced or eliminated by an applicable tax treaty) on, among
other things, interest and other fixed or determinable, annual or periodic
income paid to Nonresidents.

Interest and original issue discount of Bondholders or
Certificateholders who are foreign persons are not subject to withholding if
they are effectively connected with a United States business conducted by the
Bondholder or Certificateholders. They will, however, generally be subject to
the regular United States income tax.

Payments to holders of Residual Interest Certificates who are foreign
persons will generally be treated as interest for purposes of the 30% (or
lower treaty rate) United States withholding tax. Holders should assume that
such income does not qualify for exemption from United States withholding tax
as "portfolio interest." To the extent that a payment represents a portion of
REMIC taxable income that constitutes excess inclusion income, a holder of a
Residual Interest Security will not be entitled to an exemption from or
reduction of the 30% (or lower treaty rate) withholding tax rule. If the
payments are subject to United States withholding tax, they generally will be
taken into account for withholding tax purposes only when paid or distributed
(or when the Residual Interest Security is disposed of). The Treasury has
statutory authority, however, to promulgate regulations which would require
such amounts to be taken into account at an earlier time in order to prevent
the avoidance of tax. Such regulations could, for example, require
withholding prior to the distribution of cash in the case of Residual
Interest Certificates that do not have significant value. Under the REMIC
Regulations, if a Residual Interest Security has tax avoidance potential, a
transfer of a Residual Interest Security to a Nonresident will be disregarded
for all Federal tax purposes. A Residual Interest Security has tax avoidance
potential unless, at the time of the transfer the transferor reasonably
expects that the REMIC will distribute to the transferee residual holder
amounts that will equal at least 30% of each excess inclusion, and that such
amounts will be distributed at or after the time at which the excess
inclusion accrues and not later than the close of the calendar year following
the calendar year of accrual. If a Nonresident transfers a Residual Interest
Security to a United States person, and if the transfer has the effect of
allowing the transferor to avoid tax on accrued excess inclusions, then the
transfer is disregarded an the transferor continues to be treated as the
owner of the Residual Interest Security for purposes of the withholding tax
provisions of the Code. See "Excess Inclusion Income."

STATE TAX CONSIDERATIONS

In addition to the federal income tax consequences described in "FEDERAL
INCOME TAX CONSIDERATIONS," potential investors should consider the state
income tax consequences of the acquisition, ownership, and disposition of the
Certificates. State and local income tax law may differ substantially from
the corresponding federal law, and this discussion does not purport to
describe any aspect of the income tax laws of any state or locality.
Therefore, potential investors should consult their own tax advisors with
respect to the various state and local tax consequences of investment in the
Bonds or Certificates. In particular, potential investors in Residual
Interest Certificates should consult their tax advisers regarding the
taxation of the Residual Interest Certificates in general and the effect of
foreclosure on the Mortgaged Properties on such taxation.

ERISA CONSIDERATIONS

ERISA and the Code impose certain restrictions on employee benefit plans
("Plans") that are subject to ERISA and on persons who have certain specified
relationships to such Plans (so-called "parties in interest" within the
meaning of ERISA or "disqualified persons" within the meaning of the Code,
hereinafter referred to collectively as "Parties in Interest"). ERISA also
imposes certain duties on persons who are fiduciaries of Plans subject to
ERISA and prohibits certain transactions between a Plan and Parties in
Interest with respect to such Plan. Under ERISA, any person who exercises any
authority or control respecting the management or disposition of the assets
of a Plan, and any person who provides investment advice with respect to such
assets for a fee, is a fiduciary of such Plan.

A final regulation promulgated by the Department of Labor (the "DOL")
defining the term "plan assets" was published in the Federal Register (the
"DOL Regulation"). Under the DOL Regulation, generally, when a Plan makes an
equity investment in another entity (for example, the purchase of a REMIC
Certificate), the underlying assets of that entity may be considered Plan
assets unless certain exceptions apply. There can be no assurance that any of
the exceptions set forth in the DOL Regulation will apply to the purchase or
holding of Certificates. A Plan's investment in Certificates may cause the
Loans or other assets comprising or underlying the Primary Assets to be
deemed Plan assets. If the Loans or other assets constitute Plan assets, then
any party exercising management or discretionary control regarding those
assets may be deemed to be a Plan "fiduciary," and thus subject to the
fiduciary requirements and prohibited transaction provisions of ERISA and the
Code with respect to the Loans and other assets. Certain affiliates of the
Depositor, including Lehman Brothers Inc., the Underwriter of the
Certificates, and Lehman Commercial Paper Incorporated, the parent of the
Depositor, might be considered or might become fiduciaries or other Parties
in Interest with respect to investing Plans. Moreover, the Trustee, the
Master Servicer or any other Servicer, any insurer, special hazard insurer,
primary insurer or any other issuer of a credit support instrument relating
to the Primary Assets in a Trust Fund or certain of their respective
affiliates might be considered fiduciaries or other Parties in Interest with
respect to investing Plans. Prohibited transactions within the meaning of
ERISA and the Code could arise if Certificates are acquired by a Plan with
respect to which any such person is a Party in Interest.

One or more exemptions may be available, however, with respect to any
such prohibited transaction, including, but not limited to: Prohibited
Transaction Class Exemption ("PTCE") 90-1, regarding investments by insurance
company pooled separate accounts; PTCE 95-60, regarding investments by
insurance company general accounts; PTCE 91-38, regarding investments by bank
collective investment funds; PTCE 83-1, regarding mortgage pool investment
trusts; PTCE 84-14, regarding transactions effected by a "qualified
professional asset manager; or PTCE 96-23, regarding transactions effected by
an "in-house asset manager."

PTCE 83-1 exempts from the prohibited transaction provisions of ERISA
certain transactions involving single family residential mortgage pool
investment trusts. With respect to Mortgage Loans secured solely by property
consisting of single family residential housing, PTCE 83-1 permits, subject
to certain general and specific conditions, transactions which might
otherwise be prohibited between Plans and Parties in Interest with respect to
those Plans, related to the origination, maintenance and termination of
mortgage pools and the acquisition and holding of certain mortgage pool pass-
through certificates by Plans, whether or not the Plan's assets would be
deemed to include an ownership interest in the mortgages in the mortgage
pool. PTCE 83-1 does not apply to investments in Subordinate Certificates to
Certificates that evidence an interest in distributions of principal only.
Because certain of the Certificates may, if specified in the related
Prospectus Supplement, be Subordinate Certificates or evidence an interest in
distributions of principal only or interest only from the pooled Mortgage
Loans, PTCE 83-1 will not be applicable to such Certificates.

PTCE 83-1 sets forth three general conditions which must be satisfied
for any transaction to be eligible for exemption: (1) the maintenance of a
system of insurance or other protection for the pooled housing loans and
property securing such loans, and for indemnifying certificate holders
against reductions in pass-through payments due to property damage or
defaults in loan payments; (2) the existence of a pool trustee who is not an
affiliate of the pool sponsor; and (3) a limitation on the amount of the
payment retained by the pool sponsor together with other benefits inuring to
its benefit, to not more than adequate consideration for selling the housing
loans plus reasonable compensation for services provided by the pool sponsor
to the loan pool. PTCE 83-1 also imposes additional specific conditions for
certain types of transactions and where certain Parties in Interest are
fiduciaries with respect to a Plan that acquires a Certificate.

If a Trust Fund consists of Agency Certificates, then under the terms of
the DOL Regulation, even if the acquisition or holding by a Plan of a
Certificate with respect to such Trust Fund were characterized as the
acquisition of ownership rights in the assets of the Trust Fund (including
the Agency Certificates) such acquisition or holding would not constitute
acquisition of ownership rights in the mortgage loans underlying the Agency
Certificates.

In addition, the DOL has granted to Lehman Brothers Inc. an
administrative exemption (Prohibited Transaction Exemption 91-14 et al.;
Exemption Application No. D-7958 et al., 56 Fed. Reg. 7413 (1991)) (the
"Exemption") from certain of the prohibited transaction rules of ERISA with
respect to the initial acquisition, holding and the subsequent disposition by
Plans of certificates in pass-through trusts that consist of certain
receivables, loans, and other obligations that meet the conditions and
requirements of the Exemption. The loans covered by the Exemption include
mortgage loans and manufactured home loans such as the Loans.

Among the conditions that must be satisfied for the Exemption to apply
are the following:

(1) The acquisition of the Certificates by a Plan is on terms
(including the price for the Certificates) that are at least as
favorable to the Plan as they would be in an arm's length transaction
with an unrelated party;

(2) The rights and interests evidenced by the Certificates
acquired by the Plan are not subordinated to the rights and interests
evidenced by other Certificates of the Trust Fund;

(3) The Certificates acquired by the Plan have received a rating
at the time of such acquisition that is in one of the three highest
generic rating categories from either Standard & Poor's Ratings
Services, a division of the McGraw-Hill Companies, Inc., Moody's
Investors Service, Inc., Fitch IBCA, Inc. or Duff & Phelps Credit Rating
Co.;

(4) The sum of all payments made to the underwriter in
connection with the distribution of the Certificates represents not more
than reasonable compensation for underwriting the Certificates; the sum
of all payments made to and retained by the Depositor pursuant to the
assignment of the Loans to the Trust Fund represents not more than the
fair market value of such Loans; the sum of all payments made to and
retained by the Master Servicer and any other Servicer represents not
more than reasonable compensation for such person's services under the
Trust Agreement and reimbursement of such person's reasonable expenses
in connection therewith; and

(5) The Plan investing in the Certificates is an "accredited
investor" as defined in Rule 501(a)(1) of Regulation D of the Securities
and Exchange Commission under the Securities Act of 1933.

Moreover, the Exemption provides relief from certain self-
dealing/conflict of interest prohibited transactions only if, among other
requirements: (i) no fiduciary (or its affiliate) is an obligor with respect
to more than five percent of the fair market value of the obligations
contained in the trust; (ii) the Plan's investment in certificates does not
exceed twenty-five percent of all of the Certificates outstanding at the time
of the acquisition and (iii) immediately after the acquisition, no more than
twenty-five percent of the assets of the Plan are invested in certificates
representing an interest in one or more trusts containing assets sold or
serviced by the same entity.

On July 21, 1997, the DOL published in the Federal Register an amendment
to the Exemption which extends exemptive relief to certain mortgage-backed
and asset-backed securities transactions using pre-funding accounts for
trusts issuing pass-through certificates. The amendment generally allows
mortgage loans or other secured receivables (the "Obligations") supporting
payments to certificateholders, and having a value equal to no more than
twenty-five percent of the total principal amount of the certificates being
offered by the trust, to be transferred to the trust within a 90-day or
three-month period following the closing date (the "Pre-Funding Period")
instead of requiring that all such Obligations be either identified or
transferred on or before the closing date. The relief is available when the
following conditions are met:

(1) The ratio of the amount allocated to the pre-funding account
to the total principal amount of the certificates being offered (the
"Pre-Funding Limit") must not exceed twenty-five percent.

(2) All Obligations transferred after the closing date (the
"Additional Obligations") must meet the same terms and conditions for
eligibility as the original Obligations used to create the trust, which
terms and conditions have been approved by a Rating Agency.

(3) The transfer of such Additional Obligations to the trust
during the Pre-Funding Period must not result in the certificates to be
covered by the Exemption receiving a lower credit rating from a Rating
Agency upon termination of the Pre-funding Period than the rating that
was obtained at the time of the initial issuance of the certificates by
the trust.

(4) Solely as a result of the use of pre-funding, the weighted
average annual percentage interest rate (the "Average Interest Rate")
for all of the Obligations in the trust at the end of the Pre-Funding
Period must not be more than 100 basis points lower than the average
interest rate for the Obligations which were transferred to the trust on
the closing date.

(5) In order to ensure that the characteristics of the Additional
Obligations are substantially similar to the original Obligations which
are transferred to the trust,

(i) the characteristics of the Additional Obligations must be
monitored by an insurer or other credit support provider which is
independent of the depositor; or

(ii) an independent accountant retained by the depositor must
provide the depositor with a letter (with copies provided to each
Rating Agency rating the certificates, the related underwriter and
the related trustee) stating whether or not the characteristics of
the Additional Obligations conform to the characteristics described
in the related prospectus or prospectus supplement and/or pooling
and servicing agreement. In preparing such letter, the independent
accountant must use the same type of procedures as were applicable
to the Obligations which were transferred to the trust as of the
closing date.

(6) The Pre-Funding Period must end no later than three months or
90 days after the closing date or earlier in certain circumstances if
the pre-funding account falls below the minimum level specified in the
pooling and servicing agreement or an event of default occurs.

(7) Amounts transferred to any pre-funding account and/or
capitalized interest account used in connection with the pre-funding may
be invested only in certain permitted investments.

(8) The related prospectus or prospectus supplement must describe:

(i) any pre-funding account and/or capitalized interest
account used in connection with a pre-funding account;

(ii) the duration of the Pre-Funding Period;

(iii) the percentage and/or dollar amount of the Pre-
Funding Limit for the trust; and

(iv) that the amounts remaining in the pre-funding account at
the end of the Pre-Funding Period will be remitted to
certificateholders as repayments of principal.

(9) The related trust agreement must describe the permitted
investments for the pre-funding and/or capitalized interest account and,
if no disclosed in the related prospectus or prospectus supplement, the
terms and conditions for eligibility of Additional Obligations.

Prospective Plan investors should consult with their legal advisors
concerning the impact of ERISA and the Code, the applicability of PTCE 83-1,
the Exemption as amended or other exemptions, and the potential consequences
to their specific circumstances, prior to making an investment in the
Certificates. Moreover, each Plan fiduciary should determine whether under
the general fiduciary standards of investment prudence and diversification an
investment in the Certificates is appropriate for the Plan, taking into
account the overall investment policy of the Plan and the composition of the
Plan's investment portfolio.

LEGAL INVESTMENT CONSIDERATIONS

The Prospectus Supplement for each Series of Certificates will specify
which, if any, of the classes of Certificates offered thereby will constitute
"mortgage related securities" for purposes of the Secondary Mortgage Market
Enhancement Act of 1984, as amended ("SMMEA"). Classes of Certificates that
qualify as "mortgage related securities" will be legal investments for
persons, trusts, corporations, partnerships, associations, business trusts
and business entities (including depository institutions, life insurance
companies and pension funds) created pursuant to or existing under the laws
of the United States or of any state (including the District of Columbia and
Puerto Rico) whose authorized investments are subject to state regulation to
the same extent as, under applicable law, obligations issued by or guaranteed
as to principal and interest by the United States or any such entities.
Under SMMEA, if a state enacted legislation prior to October 4, 1991
specifically limiting the legal investment authority of any such entities
with respect to "mortgage related securities," the Certificates will
constitute legal investments for entities subject to such legislation only to
the extent provided therein. Approximately twenty-one states adopted such
legislation prior to the October 4, 1991 deadline.

SMMEA also amended the legal investment authority of federally-chartered
depository institution as follows: federal savings and loan associations and
federal savings banks may invest in, sell or otherwise deal in Certificates
without limitations as to the percentage of their assets represented thereby,
federal credit unions may invest in mortgage related securities, and national
banks may purchase Certificates for their own account without regard to the
limitations generally applicable to investment securities set forth in 12
U.S.C. 24 (Seventh), subject in each case to such regulations as the
applicable federal authority may prescribe. In this connection, federal
credit unions should review the National Credit Union Administration ("NCUA")
Letter to Credit Unions No. 96, as modified by Letter to Credit Unions No.
108, which includes guidelines to assist federal credit unions in making
investment decisions for mortgage related securities, and the NCUA's
regulation "Investment and Deposit Activities" (12 C.F.R. Part 703), (whether
or not the class of Certificates under consideration for purchase constitutes
a "mortgage related security").

All depository institutions considering an investment in the
Certificates (whether or not the class of certificates under consideration
for purchase constitutes a "mortgage related security" should review the
Federal Financial Institutions Examination Council's Supervisory Policy
Statement on Securities Activities (to the extent adopted by their respective
regulators) (the "Policy Statement"), setting forth, in relevant part,
certain securities trading and sales practices deemed unsuitable for an
institution's investment portfolio, and guidelines for (and restrictions on)
investing in mortgage derivative products, including "mortgage related
securities" that are "high-risk mortgage securities" as defined in the Policy
Statement. According to the Policy Statement, such "high-risk mortgage
securities" include securities such as Certificates not entitled to
distributions allocated to principal or interest, or Subordinated
Certificates. Under the Policy Statement, it is the responsibility of each
depository institution to determine, prior to purchase (and at stated
intervals thereafter), whether a particular mortgage derivative product is a
"high-risk mortgage security," and whether the purchase (or retention) of
such a product would be consistent with the Policy Statement.

The foregoing does not take into consideration the applicability of
statutes, rules, regulations, orders, guidelines, or agreements generally
governing investments made by a particular investor, including, but no
limited to, "prudent investor" provisions, percentage-of-assets limits and
provisions that may restrict or prohibit investment in securities that are
not "interest bearing" or "income paying."

There may be other restrictions on the ability of certain investors,
including depository institutions, either to purchase Certificates or to
purchase Certificates representing more than a specified percentage of the
investor's assets. Investors should consult their own legal advisors in
determining whether and to what extent the Certificates constitute legal
investments for such investors.

LEGAL MATTERS

Certain legal matters in connection with the Certificates offered hereby
will be passed upon for the Depositor and for the Underwriters, and the
material federal income tax consequences of the Certificates will be passed
upon for the Depositor, by Brown & Wood LLP, Washington, D.C.

THE DEPOSITOR

The Depositor was incorporated in the State of Delaware on January 2,
1987. The principal office of the Depositor is located at 200 Vesey Street,
New York, New York 10285. Its telephone number is (212) 526-5594.

The Certificate of Incorporation of the Depositor provides that the
Depositor may not conduct any activities other than those related to the
issue and sale of one or more Series and to serve as depositor of one or more
trusts that may issue and sell bonds or certificates. The Certificate of
Incorporation of the Depositor provides that any securities, except for
subordinated securities, issued by the Depositor must be rated in one of the
three highest categories available by any Rating Agency rating the Series.

The Series Supplement for a particular Series may permit the Primary
Assets pledged to secure the related Series of Certificates to be transferred
by the Issuer to a trust, subject to the obligations of the Certificates of
such Series, thereby relieving the Issuer of its obligations with respect to
such Certificates.

USE OF PROCEEDS

The Depositor will apply all or substantially all of the net proceeds
from the sale of each Series offered hereby and by the related Prospectus
Supplement to purchase the Primary Assets, to repay indebtedness which has
been incurred to obtain funds to acquire the Primary Assets, to establish the
Reserve Funds, if any, for the Series and to pay costs of structuring and
issuing the Certificates. If so specified in the related Prospectus
Supplement, Certificates may be exchanged by the Depositor for Primary
Assets. Unless otherwise specified in the related Prospectus Supplement, the
Primary Assets for each Series of Certificates will be acquired by the
Depositor either directly, or through one or more affiliates which will have
acquired such Primary Assets from time to time either in the open market or
in privately negotiated transactions.

PLAN OF DISTRIBUTION

Each Series of Certificates offered hereby and by means of the related
Prospectus Supplements may be offered through any one or more of the
following: Lehman Brothers Inc., an affiliate of the Depositor; underwriting
syndicates represented by Lehman Brothers Inc.; any originator of Loans
underlying a Series; or underwriters, agents or dealers selected by such
originator (collectively, the "Underwriters"). The Prospectus Supplement with
respect to each such Series of Certificates will set forth the terms of the
offering of such Series of Certificates and each Sequence within such Series,
including the name or names of the Underwriters (if known), the proceeds to
the Depositor (if any), and including either the initial public offering
price, the discounts and commissions to the Underwriters and any discounts or
commissions allowed or reallowed to certain dealers, or the method by which
the prices at which the Underwriters will sell the Certificates will be
determined.

The Underwriters may or may not be obligated to purchase all of the
Certificates of a Series described in the Prospectus Supplement with respect
to such Series if any such Certificates are purchased. The Certificates may
be acquired by the Underwriters for their own account and may be resold from
time to time in one or more transactions, including negotiated transactions,
at a fixed public offering price or at varying prices determined at the time
of sale.

If so indicated in the Prospectus Supplement, the Depositor will
authorize Underwriters or other persons acting as the Depositor's agents to
solicit offers by certain institutions to purchase the Certificates from the
Depositor pursuant to contracts providing for payment and delivery on a
future date. Institutions with which such contracts may be made include
commercial and savings banks, insurance companies, pension funds, investment
companies, educational and charitable institutions and others, but in all
cases such institutions must be approved by the Depositor. The obligation of
any purchaser under any such contract will be subject to the condition that
the purchase of the offered Certificates shall not at the time of delivery be
prohibited under the laws of the jurisdiction to which such purchaser is
subject. The Underwriters and such other agents will not have any
responsibility in respect of the validity or performance of such contracts.

The Depositor may also sell the Certificates offered hereby and by means
of the related Prospectus Supplements from time to time in negotiated
transactions or otherwise, at prices determined at the time of sale. The
Depositor may effect such transactions by selling Certificates to or through
dealers and such dealers may receive compensation in the form of underwriting
discounts, concessions or commissions from the Depositor and any purchasers
of Certificates for whom they may act as agents.

The place and time of delivery for each Series of Certificates offered
hereby and by means of the related Prospectus Supplement will be set forth in
the Prospectus Supplement with respect to such Series.

GLOSSARY

The following are abbreviated definitions of certain capitalized terms
used in this Prospectus. Unless otherwise provided in a supplemental Glossary
in the Prospectus Supplement for a Series, such definitions shall apply to
capitalized terms used in such Prospectus Supplement. The definitions may
vary from those in the Trust Agreement and the Trust Agreement generally
provides a more complete definition of certain of the terms. Reference should
be made to the Trust Agreement for a more complete definition of such terms.

"Accrual Date" means, with respect to any Multi-Class Series, the date
upon which interest begins accruing on the Certificates of the Series, as
specified in such Certificates and the related Prospectus Supplement.

"Accrual Amount" means, with respect to any Distribution Date for a
Multi-Class Series that occurs prior to or on the Accrual Termination Date,
the aggregate amount of interest that has accrued on the Compound Interest
Certificates of such Series during the Interest Accrual Period ending on or
prior to such Distribution Date but which is not then required to be paid.

"Accretion Termination Date" means, with respect to a Class of Compound
Interest Certificates, such date as may be specified in the related
Prospectus Supplement.

"Advance" means a cash advance by the Master Servicer or a Servicer in
respect of delinquent payments of principal of and/or interest on a Loan, and
for the other purposes specified herein and in the related Prospectus
Supplement.

"Agency Certificates" means GNMA Certificates, FNMA Certificates, and
FHLMC Certificates.

"Aggregate Asset Principal Balance" means, with respect to the Mortgage
Loans in the Trust Fund, the aggregate of the Asset Principal Balances for
all such Mortgage Loans at the time of any determination.

"Appraised Value" means, with respect to a property securing a Loan, the
lesser of the appraised value determined in an appraisal obtained at
origination of the Loan or the sales price of such mortgaged property.

"ARM" or "Adjustable Rate Mortgage" means a Mortgage Loan as to which
the related Mortgage Note provides for periodic adjustments in the interest
rate component of the Scheduled Payment pursuant to an Index as described in
the related Prospectus Supplement.

"Asset Group" means a group of individual Primary Assets which share
similar characteristics and are aggregated into one group for certain
purposes.

"Asset Principal Balance" means, with respect to any Mortgage Loan, at
the time of any determination, its outstanding principal balance as of the
Cut-off Date reduced by all amounts distributed to Certificateholders (or
used to fund the Subordination Reserve Fund, if any) and reported as
allocable to principal payments on such Mortgage Loan.

"Assumed Deposit Date" means the date specified therefor in the
Prospectus Supplement for a Series, upon which distributions on the Primary
Assets are assumed to be received for purposes of calculating Reinvestment
Income thereon.

"Available Distribution Amount" means the amount in the Certificate
Account (including amounts deposited therein from any reserve fund or other
fund or account) eligible for distribution to Certificateholders on a
Distribution Date.

"Bankruptcy Code" means the federal bankruptcy code, 11 United States
Code 101 et seq., and related rules and regulations promulgated thereunder.

"Bi-Weekly Loan" means a Mortgage Loan which provides for payments of
principal and interest by the borrower once every two weeks.

"Business Day" means a day that, in the City of New York or in the city
or cities in which the corporate trust office of the Trustee are located, is
neither a legal holiday nor a day on which banking institutions are
authorized or obligated by law, regulation or executive order to be closed.

"Buy-Down Fund" means a custodial account, established by the Master
Servicer or the Servicer for a Buy- Down Loan, that meets the requirements
set forth herein.

"Buy-Down Loan" means a level payment Mortgage Loan for which funds have
been provided by a Person other than the mortgagor to reduce the mortgagor's
Scheduled Payment during the early years of such Mortgage Loan.

"Buy-Down Period" means, with respect to a Buy-Down Loan, the period
when the related mortgagor is not obligated, on account of the buy-down plan,
to pay the full monthly payment otherwise due on the Buy-Down Loan.

"Certificate Account" means, with respect to a Series, the account
established in the name of the Trustee for the deposit of remittances
received from the Master Servicer in respect of the Primary Assets in a Trust
Fund.

"certificate guarantee insurance" means an insurance policy issued by
one or more insurance companies which will guarantee timely distributions of
interest and full distributions of principal of a Series on the basis of a
schedule of principal distributions set forth in or determined in the manner
specified in the related Prospectus Supplement for the Series.

"Certificateholder" or "Holder" means the Person in whose name a
Certificate is registered in the Certificate register.

"Certificate Interest Rate" means, with respect to any Multi-Class
Series, the per annum rate at which interest accrues on the principal balance
of the Certificates of such Series or a Class of such Series, which rate may
be fixed or variable, as specified in the related Prospectus Supplement.

"Certificates" means the Asset Trust Pass-Through Certificates. "Class"
means a Class of Certificates of a Series.

"Closing Date" means, with respect to a Series, the date specified in
the related Prospectus Supplement as the date on which Certificates of such
Series are first issued.

"Code" means the Internal Revenue Code of 1986, as amended, and
regulations promulgated thereunder.

"Collection Account" means, with respect to a Series, the account
established in the name of the Master Servicer for the deposit by the Master
Servicer of payments received from the Primary Assets in a Trust Fund (or
from the Servicers, if any).

"Compound Interest Certificate" means any Certificate of a Multi-Class
Series on which interest accrues and is added to the principal balance of
such Certificate periodically, but with respect to which no interest or
principal shall be payable except during the period or periods specified in
the related Prospectus Supplement.

"Compound Value" means, with respect to a Class of Compound Interest
Certificates, as of any Determination Date, the original principal balance of
such Class, plus all accrued and unpaid interest, if any, previously added to
the principal balance thereof and reduced by any payments of principal
previously made on such Class of Compound Interest Certificates.

"Condominium" means a form of ownership of real property wherein each
owner is entitled to the exclusive ownership and possession of his or her
individual Condominium Unit and also owns a proportionate undivided interest
in all parts of the Condominium Building (other than the individual
Condominium Units) and all areas or facilities, if any, for the common use of
the Condominium Units.

"Condominium Association" means the person(s) appointed or elected by
the Condominium Unit owners to govern the affairs of the Condominium.

"Condominium Building" means a multi-unit building or buildings, or a
group of buildings whether or not attached to each other, located on property
subject to Condominium ownership.

"Condominium Loan" means a Loan secured by a Mortgage on a Condominium
Unit (together with its appurtenant interest in the common elements).

"Condominium Unit" means an individual housing unit in a Condominium
Building.

"Conventional Loan" means a Loan that is not insured or guaranteed by
any governmental agency.

"Cooperative" means a corporation owned by tenant-stockholders who,
through the ownership of stock, shares or membership certificates in the
corporation, receive proprietary leases or occupancy agreements which confer
exclusive rights to occupy specific units.

"Cooperative Dwelling" means an individual housing unit in a building
owned by a Cooperative.

"Cooperative Loan" means a housing loan made with respect to a
Cooperative Dwelling and secured by an assignment by the borrower (tenant-
stockholder) of a security interest in shares issued by the applicable
Cooperative.

"Cut-off Date" means the date designated in the Trust Agreement for a
Series on or before which amounts due and payable with respect to a Primary
Asset will not inure to the benefit of Certificateholders of the Series.

"Cut-off Date Aggregate Asset Principal Balance" means, with respect to
the Loans in the Trust Fund as of the Cut-off Date, the Aggregate Asset
Principal Balance for all such Loans as of the Cut-off Date, reduced by all
payments of principal due on or before the Cut-off Date and not paid, and
increased by scheduled payments of principal due after the Cut-off Date but
received by the Master Servicer on or before the Cut-off Date.

"Deferred Interest" means excess interest resulting when the amount of
interest paid by a Mortgagor on a Negatively Amortizing ARM in any month is
less than the amount of interest accrued on the Stated Principal Balance
thereof.

"Deficiency Event" means, with respect to a Series, the inability of the
Trustee to distribute to Holders of one or more Classes of Certificates of
the Series (other than any Class of Subordinate Certificates prior to the
time that the Available Distribution Amount is reduced to zero), in
accordance with the terms thereof and the related Trust Agreement, any
distribution of principal or interest thereon when and as distributable due
to insufficient funds for such purpose then held in the related Trust Fund.

"Deleted Mortgage Loan" means a Mortgage Loan which is repurchased from
the Trust Fund by the Depositor or as to which a Qualifying Substitute Loan
is substituted therefor.

"Depositor" means Structured Asset Securities Corporation.

"Determination Date" means the day specified in the related Prospectus
Supplement as the day on which the Master Servicer calculates the amounts to
be distributed to Certificateholders on the next succeeding Distribution
Date.

"Distribution Date" means, with respect to a Series or Class, each date
specified as a distribution date for such Series or Class in the related
Prospectus Supplement.

"Due Date" means each date, as specified in the related Prospectus
Supplement for a Series, on which any payment of principal or interest is due
and payable to the Trustee or its nominee on any Primary Asset.

"Eligible Investments" means any one or more of the obligations or
securities described as such at "THE TRUST AGREEMENTS--Investment of Funds."

"Eligible Reserve Fund Investments" means Eligible Investments and any
other obligations or securities described as Eligible Reserve Fund
Investments in the applicable Trust Agreement, as described in the related
Prospectus Supplement for a Series.

"ERISA" means the Employer Retirement Income Security Act of 1974, as
amended.

"Escrow Account" means an account, established and maintained by the
Master Servicer or the Servicer for a Loan, into which payments by borrowers
to pay taxes, assessments, mortgage and hazard insurance premiums and other
comparable items that are required to be paid to the mortgagee are deposited.

"Excess Cash Flow" means, with respect to a Multi-Class Series, the
amount, if any, by which (a) the cash flow received from the Primary Assets
in the related Trust Fund and deposited in the related Certificate Account
(excluding any Retained Interest but including transfers from any applicable
Reserve Fund), net of applicable servicing fees, guarantee fees, insurance
premiums and other administrative expenses, on the relevant determination
date exceeds (b) the sum of (1) the Minimum Principal Distribution Amount for
such Series on such Distribution Date and (2) the Accrual Distribution
Amount, if any, on such Distribution Date.

"FDIC" means the Federal Deposit Insurance Corporation.

"FHA" means the Federal Housing Administration, a division of HUD.

"FHA Loan" means a fixed-rate housing loan insured by the FHA.

"FHLMC" means the Federal Home Loan Mortgage Corporation.

"FHLMC Certificate" means a mortgage participation certificate or other
pass-through certificate guaranteed by FHLMC as to the timely payment of
interest and, except as specified in the related Prospectus Supplement, the
ultimate collection of principal, which represents ultimately a proportional
beneficial ownership interest in a pool of residential mortgage loans.

"Final Scheduled Distribution Date" means, with respect to a Class of a
Series, the date after which no Certificates of such Class will remain
outstanding assuming timely payments or distributions are made on the Primary
Assets in the related Trust Fund.

"Floating Rate" means a Certificate Interest Rate which is subject to
change from time to time.

"Floating Rate Certificate" means any Certificate of a Multi-Class
Series which accrues interest at a Floating Rate.

"Floating Rate Distribution Date" means the Distribution Date for a
Class of Floating Rate Certificates, which may be either more or less
frequent than the Distribution Date for other Classes of the Series.

"Floating Rate Period" means the period of time during which a given
Certificate Interest Rate applies to a Class of Floating Rate Certificates.

"FNMA" means the Federal National Mortgage Association.

"FNMA Certificate" means a guaranteed mortgage pass-through certificate
or a stripped mortgage-backed security, the full and timely payment of
principal of and interest on which is guaranteed by FNMA, which represents
ultimately a proportional beneficial ownership interest in a pool of
residential mortgage loans.

"FSLIC" means the Federal Savings and Loan Insurance Corporation or any
successor thereto.

"fund or account" means any fund or account, including, without
limitation, the Certificate Account or any reserve fund established under the
Trust Agreement for a Series, excluding any fund or account not available to
make distributions to Certificateholders.

"GEM Loan" means, unless specified otherwise in the related Prospectus
Supplement for a Series, a fixed rate, fully amortizing mortgage loan
providing for monthly payments based on a 10- to 30-year amortization
schedule, with further provisions for scheduled annual payment increases for
a number of years with the full amount of such increases being applied to
principal, and with further provision for level payments thereafter.

"GNMA" means the Government National Mortgage Association.

"GNMA Certificate" means a mortgage pass-through certificate the full
and timely payment of principal of and interest on which is guaranteed by
GNMA and issued under either the GNMA I or the GNMA II program, which
represents ultimately a proportional beneficial ownership interest in a pool
of residential housing loans. A "GNMA I Certificate" is a GNMA Certificate
issued under the GNMA I program, and a "GNMA II Certificate" is a GNMA
Certificate issued under the GNMA II program.

"GPM Fund" means a trust account established by the Master Servicer or
the Servicer of a GPM Loan into which funds sufficient to cover the amount by
which payments of principal and interest on such GPM Loan assumed in
calculating payments due on the Certificates of the related Multi-Class
Series exceed scheduled payments on such GPM Loan.

"GPM Certificate" means a Certificate backed by GPM Loans.

"GPM Loan" means a mortgage loan providing for graduated payments,
having an amortization schedule (a) requiring the mortgagor's monthly
installments of principal and interest to increase at a predetermined rate
annually for a predetermined period of time after which the monthly
installments become fixed for the remainder of the mortgage term, (b)
providing for deferred payment of a portion of the interest due monthly
during such period of time and (c) providing for recoupment of the interest
deferred through negative amortization whereby the difference between the
scheduled payment of interest on the mortgage note and the amount of interest
actually accrued is added monthly to the outstanding principal balance of the
mortgage note.

"Guaranteed Investment Contract" means a guaranteed investment contract
or reinvestment agreement providing for the investment of funds held in a
fund or account, guaranteeing a minimum or a fixed rate of return on the
investment of moneys deposited therein.

"HUD" means the United States Department of Housing and Urban
Development.

"Index" means the index applicable to any adjustments in the Mortgage
Rates of any ARMs included in the Primary Assets.

"Insurance Policies" means certain mortgage insurance, hazard insurance
and other insurance policies required to be maintained with respect to
Certificates, Loans, or Private Mortgage-Backed Securities.

"Insurance Proceeds" means, unless otherwise provided in a Supplement,
amounts paid by the insurer under any of the Insurance Policies covering any
Loan or Mortgaged Property.

"Interest Accrual Period" means the period specified in the related
Prospectus Supplement for a Multi-Class Series, during which interest accrues
on the Certificates or a Class of Certificates of such Series with respect to
any Distribution Date or Special Distribution Date.

"Interest Weighted Certificates" means a Class of Certificates entitled
to a greater percentage of interest on the Loans underlying or comprising the
Primary Assets for the Series than the percentage of principal on such Loans
to which it is entitled.

"IRS" means the Internal Revenue Service.

"L/C Bank" means the issuer of a letter of credit.

"L/C Percentage" means the maximum liability of a L/C Bank under a
letter of credit, equal to the percentage specified in the related Prospectus
Supplement for a Series for which a letter of credit is issued of the initial
aggregate principal balance of the Loans in the related Trust Fund or one or
more Class of Certificates of the Series.

"letter of credit" means an irrevocable letter of credit issued by the
L/C Bank to provide limited protection against certain losses relating to
Loans, as described in the related Prospectus Supplement for a Series.

"Lifetime Mortgage Rate Cap" means the lifetime limit on the Mortgage
Rate during the life of each ARM.

"Liquidation Proceeds" means amounts received by the Master Servicer or
Servicer in connection with the liquidation of a mortgage, net of liquidation
expenses.

"Loan" means a Mortgage Loan (including an interest therein) or a
Manufactured Home Loan (including an interest therein) that is deposited by
the Depositor into the Trust Fund for a Series.

"Loan-to-Value Ratio" means the ratio, expressed as a percentage, of the
principal amount of a Loan at the date of determination to the Appraised
Value.

"Manufactured Home" means a manufactured home within the meaning of 42
United States Code, Section 5402(6), which defines a "manufactured home" as
"a structure, transportable in one or more sections, which in the traveling
mode, is eight body feet or more in width or forty body feet or more in
length, or, when erected on site, is three hundred twenty or more square
feet, and which is built on a permanent chassis and designed to be used as a
dwelling with or without a permanent foundation when connected to the
required utilities, and includes the plumbing, heating, air-conditioning, and
electrical systems contained therein; except that such term shall include any
structure which meets all the requirements of (this) paragraph except the
size requirements and with respect to which the manufacturer voluntarily
files a certification required by the Secretary of Housing and Urban
Development and complies with the standards established under (this)
chapter."

"Manufactured Home Loan" means a loan secured by a Manufactured Home.

"Master Servicer" means, with respect to a Series secured by Loans, the
Person, if any, designated in the related Prospectus Supplement to manage and
supervise the administration and servicing by the Servicers of the Loans
comprising or underlying the Primary Assets for that Series, or the
successors or assigns of such Person.

"Maximum Floating Rate" means, as to any Multi-Class Series, the per
annum interest rate cap specified for any Floating Rate Certificates of such
Series in the related Prospectus Supplement.

"Minimum Floating Rate" means, as to any Multi-Class Series, the per
annum interest rate floor specified for any Floating Rate Certificates of
such Series in the related Prospectus Supplement.

"Minimum Principal Distribution Amount" means, with respect to a
Distribution Date for a Multi-Class Series, the amount, if any, by which (a)
the outstanding principal balance of the Certificates of such Series (before
giving effect to any payment of principal on that Distribution Date) exceeds
(b) the aggregate Asset Value of the Primary Assets for the Series as of that
Distribution Date.

"Minimum Mortgage Rate" means the lifetime minimum Mortgage Rate during
the life of each ARM.

"Mortgage" means the mortgage, deed of trust or other instrument
securing a Mortgage Note.

"Mortgage Loan" means a mortgage loan (including an interest therein)
secured by Mortgaged Property, including Cooperative Loans and Condominium
Loans.

"Mortgage Note" means the note or other evidence of indebtedness of a
Mortgagor under the Mortgage Loan.

"Mortgage Pool" means with respect to a Trust Fund for a Series of
Certificates, a pool of Mortgage Loans.

"Mortgaged Property" means the real property securing a Mortgage Loan.

"Mortgage Rate" means, unless otherwise indicated herein or in the
Prospectus Supplement, the interest rates borne by each Loan.

"Mortgagor" means the obligor on a Mortgage Note.

"Multifamily Property" means any property securing a Loan consisting of
multifamily residential rental property or cooperatively owned multifamily
property consisting of five or more dwelling units.

"Multi-Class Series" means a Series of Certificates that may include
Floating Rate Certificates, Compound Interest Certificates and Planned
Amortization Certificates, and/or Subordinate and Senior Classes embodying a
subordination feature which protects the Senior Class or Classes in the event
of failure of timely payment of Primary Assets. With respect to Series of
Asset Trust Pass-Through Certificates other than Multi-Class Series, each
Class is designated to receive a particular portion of future principal or
interest cash flows on the Primary Assets, which designation does not change
over the term of the Certificates; provided, however, a Series may be so
characterized if the designation changes only on account of a subordination
feature in one or more Subordinate Classes which protects one or more Senior
Classes in the event of failure of timely payment of Primary Assets.

"1986 Act" means the Tax Reform Act of 1986.

"Negatively Amortizing ARMs" means ARMs which provide for limitations on
changes in the Scheduled Payment which can result in Scheduled Payments which
are greater or less than the amount necessary to amortize such ARM by its
stated maturity at the Mortgage Rate in effect in any particular month.

"Pass-Through Rate" means the rate of interest paid to the
Certificateholders in respect of the Primary Assets.

"PAC" ("Planned Amortization Certificates") means a Class of
Certificates of a Series on which no payment of principal will need to be
made until the earlier of the date specified in the related Prospectus
Supplement or the date on which the principal of all Certificates of the
Series having an earlier Final Scheduled Distribution Date have been paid in
full.

"Percentage Interest" means, with respect to a Certificate, the
proportion (expressed as a percentage) of the percentage amounts of all of
the Certificates in the related Class represented by such Certificate, as
specified in the related Prospectus Supplement.

"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint stock company, trust
(including any beneficiary thereof), unincorporated organization, or
government or any agency or political subdivision thereof.

"PMBS Agreement" means the pooling and servicing agreement, indenture,
trust agreement or similar agreement pursuant to which a Private Mortgage-
Backed Security is issued.

"PMBS Issuer" means, with respect to Private Mortgage-Backed Securities,
the depositor or seller/ servicer under a PMBS Agreement.

"PMBS Servicer" means the servicer of the Loans underlying a Private
Mortgage-Backed Security.

"PMBS Trustee" means the trustee designated under a PMBS Agreement.

"Participation Certificate" means a certificate evidencing a
participation interest in a pool of Loans.

"Prepayment Period" means, with respect to any Distribution Date, the
period specified in the related Prospectus Supplement for a Series.

"Primary Assets" means the Agency Certificates, Private Mortgage-Backed
Securities or Loans, as the case may be, which are included in the Trust Fund
for such Series. A Primary Asset refers to a specific Agency Certificate,
Private Mortgage-Backed Security or Loan, as the case may be.

"Principal Distribution Amount" means, unless specified otherwise in the
Prospectus Supplement for a Multi-Class Series, the sum of (a) the Accrual
Distribution Amount, if any, (b) the Minimum Principal Distribution Amount
and (c) the percentage, if any, of Excess Cash Flow specified in the related
Prospectus Supplement.

"Principal Weighted Certificates" means a Class of Certificates entitled
to a greater percentage of principal on the Loans underlying or comprising
the Primary Assets in the Trust Fund for the related Series than the
percentage of interest to which it is entitled.

"Private Mortgage-Backed Security" means a mortgage participation or
pass-through certificate representing a fractional, undivided interest in
Loans or collateralized mortgage obligations secured by Loans.

"Proceeding" means any suit in equity, action at law or other judicial
or administrative proceeding.

"Proposed Regulations" means the proposed Treasury regulations issued
under Sections 1271-1273 and 1275 of the Code.

"Qualified Insurer" means a mortgage guarantee or insurance company duly
qualified as such under the laws of the states in which the Mortgage
Properties are located duly authorized and licensed in such states to
transact the applicable insurance business and to write the insurance
provided.

"Rating Agency" means any nationally recognized statistical rating
organization (or organizations) that was (or were) requested by the Depositor
to rate the Certificates upon the original issuance thereof.

"Regular Interest" means a regular interest in a REMIC as described
herein under "CERTAIN FEDERAL INCOME TAX CONSIDERATIONS - Tax Status as a
REMIC."

"Reinvestment Income" means any interest or other earnings on Funds or
Accounts that are part of the Trust Fund for a Series.

"REMIC" means a real estate mortgage investment conduit under Section
860D of the Code.

"REMIC Administrator" means the Person, if any, specified in the related
Prospectus Supplement for a Series for which a REMIC election is made, to
serve as administrator of the Series.

"Remittance Date" means the calendar day or days of each month, as
specified in the related Prospectus Supplement for a Series, on which the
Servicer is required to withdraw funds from the related Servicer Account for
remittance to the Master Servicer.

"REO Property" means real property which secured a defaulted Loan which
has been acquired upon foreclosure, deed in lieu of foreclosure or
repossession.

"Reserve Fund" means, with respect to a Series, any Reserve Fund
established pursuant to the Trust Agreement.

"Residual Interest" means a residual interest in a REMIC as described
herein under "CERTAIN FEDERAL INCOME TAX CONSIDERATIONS - Tax Status as a
REMIC."

"Retained Interest" means, with respect to a Primary Asset, the amount
or percentage specified in the related Prospectus Supplement that is not sold
by the Depositor or seller of the Primary Asset and, therefore, is not
included in the Trust Fund for the related Series.

"Scheduled Payments" the scheduled payments of principal and interest to
be made by the borrower on a Mortgage Loan in accordance with the terms of
the related Mortgage Note.

"Senior Certificateholder" means the Holder of a Senior Certificate.

"Senior Certificates" means a Class of Certificates as to which the
Holders' rights to receive distributions of principal and interest are senior
to the rights of Holders of Subordinate Certificates, to the extent specified
in the related Prospectus Supplement.

"Servicer" means the entity which has primary liability for servicing
Loans if other than the Master Servicer.

"Servicing Account" means an account established by a Servicer (other
than the Master Servicer) who is directly servicing Loans, into which such
Servicer will be required to deposit all receipts received by it with respect
to the Primary Assets serviced by such Servicer.

"Single Family Property" means property securing a Loan consisting of
one-to four-family attached or detached residential housing, including
Cooperative Dwellings.

"Subordinate Certificateholder" means a Holder of a Subordinate
Certificate.

"Subordinate Certificates" means a Class of Certificates as to which the
rights of Holders to receive distributions of principal and interest are
subordinated to the rights of Holders of Senior Certificates, to the extent
and under the circumstances specified in the related Prospectus Supplement.

"Subordinated Amount" means the amount, if any, specified in the related
Prospectus Supplement for a Series with a Class of Subordinated Certificates,
that the Subordinate Certificates are subordinated to the Senior Certificates
of the same Series.

"Subordination Reserve Fund" means the subordination reserve fund, if
any, for a Series with a Class of Subordinate Certificates, established
pursuant to the related Trust Agreement.

"Subsidy Account" means a custodial account established by the Master
Servicer or the Servicer for a Loan into which subsidy funds contributed by
the seller of the property securing the Loan (or by another party) necessary
to maintain the scheduled level of payments due on the Loan are deposited.

"Trust Agreement" means the trust agreement relating to a Series among
the Depositor, the Master Servicer, and the Trustee.

"Trustee" means the trustee under a Trust Agreement, and its successors.

"Trust Fund" means all property and assets held for the benefit of the
Certificateholders by the Trustee under the Trust Agreement for a Series of
Certificates including, without limitation, the Primary Assets (except any
Retained Interests), all amounts in the Certificate Account, Collection
Account or Servicer Accounts, distributions on the Primary Assets (net of
servicing fees), and reinvestment earnings on such net distributions and
amounts deposited in any reserve fund and the proceeds of any insurance
policies required to be maintained with respect to the Loans.

"UCC" means the Uniform Commercial Code.

"VA" means the Veterans Administration.

"VA Loans" means housing loans partially guaranteed by the VA.

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The estimated expenses expected to be incurred by the Registrant in
connection with the issuance and distribution of the securities being
registered, other than underwriting compensation, are as follows:

SEC Registration Fee . . . . . . . . . . . . . . . . . . . . $ 1,475,000
Trustee's Fees and Expenses (including counsel fees) . . . . 15,000
Printing and Engraving Costs . . . . . . . . . . . . . . . . 150,000
Rating Agency Fees . . . . . . . . . . . . . . . . . . . . . 320,000
Legal Fees and Expenses . . . . . . . . . . . . . . . . . . . 375,000
Blue Sky Fees and Expenses . . . . . . . . . . . . . . . . . 15,000
Accounting Fees and Expenses . . . . . . . . . . . . . . . . 100,000
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . 50,000
Total . . . . . . . . . . . . . . . . . . . . . . . . . . $2,500,000

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

The registrant's certificate of incorporation provide that directors and
officers of the registrant will be indemnified as permitted by Delaware law.
Section 145 of the Delaware Corporation Law provides, in substance, that
Delaware corporations have the power, under specified circumstances, to
indemnify their directors, officers, employees or agents in connection with
actions, suits or proceedings involving any of them by reason of the fact
that they were or are such directors, officers, employees or agents, against
expenses incurred in any such action, suit or proceeding.

The form of Underwriting Agreement filed as Exhibit 1.1 to this
Registration Statement provides, under certain circumstances, for
indemnification of the Registrant and other persons.

ITEM 16. EXHIBITS.

1.1* Form of Underwriting Agreement
3.1 Certificate of Incorporation of Structured Asset Securities
Corporation as currently in effect
3.2 Bylaws of Structured Asset Securities Corporation as currently in
effect
4.1*/** Form of Trust Agreement
4.2* Form of Servicing Agreement
4.3* Form of Standard Provisions for Servicing
5.1 Opinion of Brown & Wood LLP as to legality (including consent of
such firm)
8.1 Opinion of Brown & Wood LLP as to certain tax matters (including
consent of such firm included in Exhibit 5.1)
23.1 Consent of Brown & Wood LLP (included in Exhibit 5.1)
24.1 Power of Attorney (included on page II-4)
99.1* Form of Primary Mortgage Insurance Policy
99.2* Form of FHA Mortgage Insurance Certificate
99.3* Form of VA Loan Guaranty
99.4* Form of Mortgage Pool Insurance Policy
99.5* Form of Standard Hazard Insurance Policy
99.6* Form of Special Hazard Insurance Policy
99.7* Form of Bankruptcy Bond
99.8** Form of Mortgage Repurchase Bond
99.9** Form of Letter of Credit
99.10** Form of Interest Rate Protection Agreement
99.11** Form of Interest Rate Swap Agreement
99.12** Form of Certificate Guarantee Insurance Policy
99.13*/** Form of Exchange Agreement

- ---------------------------------------------
* Incorporated herein by reference to Amendment No. 1 to Registration
Statement on Form S-11 (Reg. No. 33-13986), filed with the Commission on
November 12, 1987.

** Incorporated herein by reference to Form 8-K filed by Structured Asset
Securities Corporation on March 15, 1989.

ITEM 17. UNDERTAKINGS

A. Undertaking in respect of Rule 415 offering.

"The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made,
a post effective amendment to this registration statement to include any
material information with respect to the plan of distribution not previously
disclosed in the registration statement or any material change to such
information in the registration statement.

(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination
of the offering.

B. Undertaking in respect of filings incorporating subsequent Exchange Act
documents by reference.

The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of
the Registrant's annual report pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.

C. Undertaking in respect of indemnification.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the Registrant
will, unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.

D. Undertakings for registration statement permitted by Rule 430A.

The undersigned Registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in the
form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4)
or 497(h) under the Securities Act of 1933 shall be deemed to be part of this
Registration Statement as of the time it was declared effective; and

(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in New York, New York on the 6th day of March,
1998.

STRUCTURED ASSET SECURITIES CORPORATION

By: /s/ Theodore P. Janulis
----------------------------------
Theodore P. Janulis
President

Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement on Form S-3 has been signed below by the
following persons in the capacities and on the dates indicated. Each person
whose signature appears below constitutes and appoints Theodore P. Janulis,
Mark L. Zusy, James J. Sullivan and Charles B. Hintz, and each of them his or
her true and lawful attorney-in-fact and agent, acting together or alone,
with full powers of substitution and resubstitution, for them and in their
name, place and stead, to sign any or all amendments to this Registration
Statement (including any pre-effective or post-effective amendment), and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, acting together or alone, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and
purposes as they might or could do in person, hereby ratifying and confirming
all that said attorneys-in-fact and agents, acting together or alone, or
other substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.

<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
/s/ Theodore P. Janulis President and Director March 6, 1998
- --------------------------- (Principal Executive Officer)
Theodore P. Janulis

/s/ Mark L. Zusy Vice President and Director March 6, 1998
- ---------------------------
Mark L. Zusy
Director March __, 1998
___________________________
James J. Sullivan

/s/Charles B. Hintz
- --------------------------- Chief Financial Officer March 6, 1998
Charles B. Hintz (Principal Financial and
Accounting Officer)

</TABLE>

EXHIBIT INDEX
_____________

Exhibit No. Description Page No.
- ------------ ----------- --------

1.1* Form of Underwriting Agreement

3.1 Certificate of Incorporation of Structured Asset
Securities Corporation as currently in effect

3.2 Bylaws of Structured Asset Securities Corporation
as currently in effect

4.1*/** Form of Trust Agreement

4.2* Form of Servicing Agreement

4.3* Form of Standard Provisions for Servicing

5.1 Opinion of Brown & Wood LLP as to legality
(including consent of such firm)

8.1 Opinion of Brown & Wood LLP as to certain tax matters
(including consent of such firm included in Exhibit 5.1)

23.1 Consent of Brown & Wood LLP (included in Exhibit 5.1)

24.1 Power of Attorney (included on page II-4)

99.1* Form of Primary Mortgage Insurance Policy

99.2* Form of FHA Mortgage Insurance Certificate

99.3* Form of VA Loan Guaranty

99.4* Form of Mortgage Pool Insurance Policy

99.5* Form of Standard Hazard Insurance Policy

99.6* Form of Special Hazard Insurance Policy

99.7* Form of Bankruptcy Bond

99.8* Form of Mortgage Repurchase Bond

99.9* Form of Letter of Credit

99.10** Form of Interest Rate Protection Agreement

99.11** Form of Interest Rate Swap Agreement

99.12** Form of Certificate Guarantee Insurance Policy

99.13*/** Form of Exchange Agreement

- -------------------

* Incorporated herein by reference to Amendment No. 1 to Registration
Statement on Form S-11 (Reg. No. 33-13986) filed with the Commission on
November 12, 1987.

** Incorporated herein by reference to Form 8-K filed by Structured Asset
Securities Corporation on March 15, 1989.

EXHIBIT 3.1

CERTIFICATE OF AMENDMENT

CERTIFICATE OF INCORPORATION

STRUCTURED ASSET SECURITIES CORPORATION

Structured Asset Securities Corporation, a Delaware corporation (the
"Corporation"), having its registered office at Corporation Trust Center,
1209 Orange Street, in the City of Wilmington, in the County of New Castle,
hereby certifies to the Secretary of State of the State of Delaware that:

FIRST: Item (a)(ii) of the Third Article of the Restated
Certificate of Incorporation of the Corporation is hereby amended so as
to read in its entirety as follows:

mortgage notes and related mortgages, or interests therein
(including, but not limited to, participation certificates with
respect to such mortgage notes or related mortgages), or guaranteed
notes, provided the guaranty is secured by a mortgage on real
property (collectively, the "Pledged Mortgages"), which are either
owned by the Corporation or granted by a Borrower to secure payment
of a Mortgage Backed Note;

SECOND: The Board of Directors of the Corporation by unanimous
written consent adopted a resolution which sets forth the foregoing
amendment to the Certificate of Incorporation, in accordance with
Section 242 of the General Corporation Law of the State of Delaware,
declaring that the amendment to die Certificate of Incorporation as
proposed was advisable and directing that it be submitted for action
thereon by the sole stockholder of the Corporation.

THIRD: The amendment has been consented to and authorized and
approved by the holder of all the issued and outstanding stock of the
Corporation, entitled to vote, by. a written consent given in accordance
with the provisions of Section 228 of the General Corporation Law of the
State of Delaware.

FOURTH: This Certificate of Amendment of the Certificate of
Incorporation shall be effective on filing.

IN WITNESS WHEREOF, Structured Asset Securities Corporation has caused
Certificate to be signed on this 3rd day of May, 1994 in its name and on its
behalf by, Elizabeth M. Carey, its Vice President and attested by Eileen M.
Bannon. its Assistant Secretary, pursuant to 103(a) of the General
Corporation Law of the State of Delaware.

/s/ Elizabeth M. Carey
-----------------------------------
Elizabeth M. Cary
Vice President

ATTESTED:

By /s/ Eileen M. Bannon
---------------------------------
Eileen M. Bannon
Assistant Secretary

RESTATED

CERTIFICATE OF INCORPORATION

STRUCTURED ASSET SECURITIES CORPORATION

-----------------------------------------------

Pursuant to Sections 245 and 242 of the General
Corporation Law of the State of Delaware

-----------------------------------------------

STRUCTURED ASSET SECURITIES CORPORATION, a Delaware
corporation organized on January 2, 1987 under the name E. F.
Hutton Mortgage Capital Inc., does hereby amend and restate
its Restated Certificate of Incorporation, aa heretofore
amended, to read in its entirety as set forth below:

ARTICLE I

NAME
----

The name of the corporation is Structured Asset
Securities Corporation (the "Corporation").

ARTICLE II

REGISTERED OFFICE REGISTERED AGENT
----------------------------------

The street address of the registered office of the
Corporation is 1209 Orange Street, Wilmington, New Castle
County, Delaware 19801, and the name of its registered
agent at that address is The Corporation Trust Company.

ARTICLE III
PURPOSES
--------

The purpose for which the Corporation is organized is:

(a) To acquire, own, hold, transfer, assign, pledge and
otherwise deal with the following (the "Mortgage Collateral"):
(i)(A) "fully modified pass-through" mortgage-backed certificates
guaranteed as to timely payment of principal and interest by the
Government National Mortgage Association; (B) Guaranteed Mortgage
Pass-Through Certificates issued and guaranteed as to timely
payment of principal and interest by the Federal National Mortgage
Association; (C) Mortgage Participation Certificates issued and
guaranteed as to timely payment of interest and principal, in most
cases, by the Federal Home Loan Mortgage Corporation (collectively,
the "Agency Certificates"); (D) securities representing interests
in Agency Certificates; or (E) mortgage pass-through certificates
or mortgage-collateralized bonds issued by any other entity with
respect to or secured by a pool of mortgage loans (collectively,
"Certificates") which are either owned by the Corporation or
granted by a Borrower (as defined below) to secure payment of
Mortgage Backed Notes (as defined below); (ii) mortgage notes and
related mortgages, or interests therein (including, but not limited
to, participation certificates with respect to such mortgage notes
or related mortgages) ("Pledged Mortgages"), which are either owned
by the Corporation or granted by a Borrower to secure payment of a
Mortgaged Backed Note; (iii) mortgage backed notes evidencing loans
made by the Corporation to commercial banks, saving and loan
associations and savings banks, the deposits of which are insured
by the Federal Deposit Insurance Corporation ("FDIC"), affiliates
of FDIC insured institutions, and other entities which are not FDIC
insured institutions but are engaged directly, or through the
owners of such entities or their affiliates, in mortgage financing,
origination or funding activities (e.g., mortgage bankers, home
builders and state agencies), or to any other entity (collectively,
the "Borrowers"), which loans are secured by Pledged Mortgages or
Certificates ("Mortgage Backed Notes"); and (iv) real property and
any improvements thereon, including commercial, multifamily and
residential properties ("Properties");

(b) To authorize, issue, sell and deliver bonds or other
evidences of indebtedness ("Bonds") that are secured by a pledge or
other assignment of Mortgage Collateral, reserve funds, guaranteed
investment contractor letters of credit, insurance contracts,
surety bonds or any other credit enhancement device (collectively,
the "Collateral"), and are rated in one of the three highest
categories available by any nationally recognized statistical
rating agency: provided that one or more classes of Bonds of a
series issued by the Corporation may be subordinate to other Bonds
of such series and need not be so rated;

(c) To serve as depositor of one or more trusts that may
authorize, issue, sell and deliver Bonds or certificates of
interest that are secured by a pledge or other assignment of, or
represents an interest in, the Collateral and are rated in one of
the three highest categories available by any nationally recognized
rating agency; provided that one or more classes of an issue of
such securities by such trust may be subordinate to other
securities of such issue and not so rated; and

(d) To do all such things as are reasonable or necessary to
enable the Corporation to carry out any of the above, including
entering into loan agreements, insurance agreements, servicing
agreements, reimbursement agreements, issuing debt (subject to the
provisions of this Article III, Article VIII and Article X hereof)
and selling residual interests in Mortgage Collateral or selling
certificates of participation in any trust for which the
Corporation serves as depositor.

ARTICLE IV

AUTHORIZED STOCK
----------------

The Corporation may issue 1,000 shares, divided into 1,000
shares of Common Stock with a par value of $1.00 per share. No
additional Common Stock and no classes of Preferred Stock may be
issued.

ARTICLE V

BOARD OF DIRECTORS
------------------

The Board of Directors shall Consist of not less than one nor
more than fifteen members, the exact number of which shall be fixed
from time to time by the Board of Directors. The number of
Directors may be changed as provided in the Bylaws. The Directors
need not be elected by written ballot unless required by the Bylaws
of the Corporation.

ARTICLES VI

BYLAWS
------

In furtherance and not in limitation of the powers conferred
by statute, the Board of Directors is expressly authorized and
empowered to make, alter or repeal the Bylaws of the Corporation,
subject to the reserved power of the stockholders to adopt, amend
or repeal Bylaws which may include the power to restrict in any
manner power granted to the Board of Directors by this Article VI.

ARTICLE VII

LIMITATION ON DIRECTOR LIABILITY
--------------------------------

No Director of the Corporation shall be personally liable to
the Corporation or its stockholders for monetary damages for breach
of fiduciary duty as a Director; provided, however, that this
limitation of liability of a Director shall not apply with respect
to (i) any breach of the Director's duty of loyalty to the Corpora-
tion or its stockholders, (ii) acts or omissions not in good faith
or which involve intentional misconduct or a knowing violation of
law, any liability arising under Section 174 of the General
Corporation Law of the State of Delaware and (iv) any transaction
from which the Director derives an improper personal benefit.

ARTICLE VIII

LOAN AGREEMENTS AND INDENTURES
------------------------------

The Corporation shall not do or perform any act expressly
prohibited below without the written consent of each trustee and
each lender (collectively, the "Lenders") under any loan agreement,
similar agreement or indenture to which the Corporation is party
(collectively, the "Loan Agreements");

(i) The Corporation shall not incur, assume or
guarantee any indebtedness other than indebtedness to the
Lenders except for such indebtedness that (a) is
described in paragraph (b) or (c) of Article III hereof;
(b) by its terms is subordinated entirely to the
indebtedness of the Corporation evidenced by the Loan
Agreements; (c) is a capital stock liability; (d) is an
account payable and expense accrual incurred in the
ordinary course of business including fees and expenses
payable pursuant to a collateral custody, pledge and
security agreement entered into by the lenders; (e) is
short-term borrowing from affiliates for the purpose of
paying organizational expenses of the Corporation and
initial expenses of filing any registration statement
with the Securities and Exchange Commission; or (f) may
be incurred by the Corporation that has been rated in at
least the third highest rating category by Standard &
Poor's Corporation or other nationally recognized credit
rating agency.

(ii) The Corporation shall not engage in any
business or activity other than in connection with or
relating to the issuance of indebtedness evidenced by the
Loan Agreements and such activities as are reasonable and
necessary to enable the Corporation to carry out its
purposes as set forth in Article III hereof.

(iii) The Corporation shall not consolidate (other
than for federal income tax purposes) or merge with or
into any other entity or convey or transfer its
properties and assets, substantially or in the entirety,
to any entity (other than as described in paragraphs (a),
(b) (c) or (d) of Article III hereof) unless (a) the
entity (if other than the Corporation) formed or
surviving such consolidation or merger, or that acquires
by conveyance or transfer the properties and assets of
the Corporation substantially or in the entirety, shall
be organized and existing under the laws of the United
States of America or any state thereof or the District of
Columbia, and shall expressly assume, by a supplement to
each Loan Agreement, executed and delivered to each
Lender under each Loan Agreement, in form satisfactory to
each Lender under each Loan Agreement, the due and
punctual payment of the principal of and interest an all
indebtedness then outstanding under each Loan Agreement
and the performance of every covenant of each Loan
Agreement on the part of the Corporation to be performed
or observed and shall be subject to the restrictions set
forth in this Certificate, (b) immediately after giving
effect to such transaction, no default or event of
default under any Loan Agreement shall have occurred and
be continuing and (c) the corporation shall have
delivered to each Lender under each Loan Agreement an
officers' certificate and an opinion of counsel, each
stating that such consolidation, merger, conveyance or
transfer and such supplement comply with the Loan
Agreement and that all conditions precedent provided for
in each such Loan Agreement relating to such transaction
have been complied with.

Upon any consolidation or merger, or any conveyance
or transfer of the properties and assets of the
Corporation substantially as provided above, the entity
formed by or surviving such consolidation or merger (if
other than the Corporation) or the entity to which such
conveyance or transfer is made shall succeed to, and be
substituted for, and may exercise every right and power
of, the Corporation under each Loan Agreement with the
same effect as if such entity had been named as the
"lssuer" or "Borrower" therein. In the event of any such
conveyance or transfer the entity named as the "Issuer"
or "Borrower" in each such Loan Agreement or any
successor that shall theretofore have become such in the
manner prescribed in each such Loan Agreement may be
dissolved, wound-up and liquidated at any time
thereafter, and such entity thereafter shall be
released.from its liabilities as obligor and maker on all
of the indebtedness, and from its obligations under the
Loan Agreements.

(iv) The Corporation shall not dissolve or
liquidate, in whole or in part.

(v) The Corporation shall not amend, alter, change or
repeal any provision contained in this Article VIII, Article
IX or Article X without (a) the affirmative vote in favor
thereof of eighty percent (80%) of the then outstanding stock
and (b) the prior written consent of each Lender under each
Loan Agreement pursuant to which indebtedness under each Loan
Agreement pursuant to which indebtedness that are then
outstanding may have been issued by the Corporation.

ARTICLE IX

COVENANTS REGARDING OPERATIONS
------------------------------

The Corporation shall conduct its affairs in accordance with the
following provisions:

(i) It shall establish an office through which its
business will be conducted separately and apart from that
of any person or entity which is the owner of more than
50% of its outstanding stock, currently Shearson Lehman
Hutton Inc. (the "Parent") (although the Parent may lease
space to the Corporation).

(ii) It shall maintain separate corporate records
and books of account from those of the Parent. The books
of the Corporation may be kept (subject to any provision
contained in the statutes) outside the State of Delaware
at such place or places as may be designated from time to
time by the Board of Directors or in the Bylaws of the
Corporation.

(iii) Its funds shall not be commingled with those
of its Parent or any of its subsidiaries or affiliates
other than the Corporation.

(iv) Its Board of Directors shall hold appropriate
meetings to authorize all of its corporate actions.

(v) The Corporation shall conduct its business so
as not to mislead others as to the identity of the entity
with which they are concerned.

(vi) The Corporation shall provide for its operating
expenses and liabilities from its own funds, which may
include funds borrowed from affiliates (other than its
Parent) (although certain organizational expenses of the
Corporation may be paid by its Parent).

(vii) The Corporation shall, when appropriate,
obtain proper authorization from its Directors or
stockholders for corporate action.

(viii) The Corporation shall act solely in its
corporate name and through its duly authorized officers
or agents in the conduct of its business.

(ix) The Corporation shall not hold itself out as
being liable for the debts of any other entity (except as
may me implicit in a subordination agreement executed in
connection with the issuance of Bonds) and shall not
permit the Parent to hold itself out as liable for the
debts of the Corporation.

(x) Each of the Corporation and the Parent shall
maintain an arm's-length relationship with the other.

ARTICLE X
AMENDMENTS
----------

If the indebtedness under a Loan Agreement is given a rating
by a nationally recognized statistical rating agency, this
Certificate of Incorporation may not be amended prior to notice
being given by registered or certified mail to such rating agency.
In addition, no additional indebtedness may be incurred by the
Corporation, other than indebtedness described in paragraph (b),
(c) or (d) of Article III hereof.

ARTICLE XI

TRANSFER OF ASSETS
------------------

The Corporation may not transfer all or substantially all of
its assets to a transferee unless such transferee is subject to the
restrictions contained in this Certificate. A pledge of its assets
in connection with the issuance of debt shall not be considered
such a transfer. Additionally, the Corporation may transfer any
residual interest it may have in assets so pledged to any third
person and such transfer shall not constitute a transfer subject to
this Article.

ARTICLE XII

SPECIAL COVENANTS FROM LENDERS
------------------------------

The Corporation shall receive a covenant from all creditors,
other than Lenders, prior to incurring debt, that no petition in
bankruptcy shall be filed against the Corporation until at least 90
days have expired since payment in full to the Lenders.

The foregoing Restated Certificate van duly adopted in
accordance with the provisions of Sections 228, 242 and 245 of the
general Corporation Law of the State of Delaware.

IN WITNESS WHEREOF, Structured Asset Securities Corporation
ban caused this Restated Certificate of Incorporation to be duly
executed in its corporate name this 26th day of October 1992.

STRUCTURED ASSET SECURITIES
CORPORATION

By: /s/ Mark L. Zusy
------------------------
Name: Mark L. Zusy
Title: Senior Vice President

ATTEST:

By: /s/ Michelle Slaughter
----------------------------
Name: Michelle Slaughter
Title: Assistant Secretary

EXHIBIT 3.2

BYLAWS

STRUCTURED ASSET FUNDING CORPORATION
------------------------------------

ARTICLE I
OFFICES
-------

Section 1.1. Principal Office. The principal office of the Corporation
----------------
shall be at 3131 One Main Place, Dallas, Texas 75250. The registered office
in the State of Delaware will be in the City of Wilmington, County of New
Castle, and the resident agent in charge thereof shall be The Corporation
Trust Company.

Section 1.2. Other Offices. The Corporation may have offices at such
-------------
other place or places as from time to time the Board of Directors may
determine or the business of the Corporation may require.

ARTICLE II

MEETINGS OF STOCKHOLDERS
------------------------

Section 2.1. Annual Meetings. The annual meeting of the stockholders
---------------
for the election of directors and for the transaction of such other business
as may come before the meeting shall be held on such date and at such time
and place within or without the State of Delaware as may be designated by the
Board of Directors.

Section 2.2. Special Meetings. Special meetings of the stockholders for
----------------
any purpose or purposes, unless otherwise prescribed by statute, may be
called at any time by the President or by order of the Board of Directors and
shall be called by the President or Secretary upon the request in writing of
a stockholder or stockholders holding of record at least one-fourth of the
outstanding shares of stock of the Corporation entitled to vote at such
meeting. Any such written request of a stockholder or stockholders shall
state a proper purpose or purposes of the meeting and shall be delivered to
the President or Secretary.

Section 2.3. Place of Meeting. Each meeting of stockholders of the
----------------
Corporation, whether annual or special, shall be held on such date and at
such time and place within or without the State of Delaware as shall be fixed
by the Board of Directors and specified in the notice or waiver of notice of
said meeting.

Section 2.4. Notice of Meetings. Except as otherwise provided by law,
------------------
notice of each meeting of the stockholders shall be given to each stockholder
of record entitled to vote at such meeting, whether annual or special, not
less than 10 nor more than 60 days before the day on which the meeting is to
be held, by delivering a typewritten or printed notice thereof to him or her
personally, or by mailing such notice in a postage prepaid envelope addressed
to him or her at his or her post office address furnished by him or her to
the Secretary of the Corporation for such purpose, or, if he or she shall not
have furnished to the Secretary of the Corporation his or her address for
such purpose, then at his or her post office address last known to the
Secretary of the Corporation. Each such notice shall state the purpose or
purposes for which the meeting is called, and the date and time when, and the
place where such meeting is to be held. Except where expressly required by
law, no publication of any notice of a meeting of stockholders shall be
required. Notice of any meeting of stockholders shall not be required to be
given to any stockholder who shall attend such meeting in person or by proxy.
Notice of any adjourned meeting of the stockholders shall not be required to
be given, except where expressly required by law.

Section 2.5. Quorum. At each meeting of the stockholders, except where
------
other provision is made by law, the presence, in person or by proxy, of the
holders of record of a majority of the issued and outstanding stock of the
Corporation entitled to vote at such meeting shall constitute a quorum for
the transaction of business. In the absence of a quorum, a majority in
interest of the stockholders of the Corporation present in person or by proxy
and entitled to vote or, in the absence of any stockholder entitled to vote,
any officer entitled to preside at, or act as Secretary of, such meeting,
shall have the power to adjourn the meeting from time to time, until
stockholders holding the requisite amount of stock shall be present or
represented. At any such adjourned meeting at which a quorum shall be
present, any business may be transacted which might have been transacted at
the meeting as originally called.

Section 2.6. Voting. At each meeting of the stockholders, every
------
stockholder of record of the Corporation entitled to vote at such meeting
shall be entitled to one vote in person or by proxy for each share of stock
of the Corporation registered in his or her name on the books of the
Corporation (a) on the date fixed pursuant to Section 7.3 of the Article VII
of these Bylaws as the record date for the determination of stockholders
entitled to vote at such meeting; or (b) if no such record date shall have
been fixed, then as of the close of business on the day next preceding the
day on which notice is given or, if notice is waived, at the close of
business on the day next preceding the day on which the meeting is held. Any
vote on stock of the Corporation may be given by the stockholder entitled
thereto in person or by proxy appointed by an instrument in writing,
including without limitation a telegraph or a cable, subscribed by such
stockholder or by his or her attorney thereunto authorized and delivered to
the Secretary of the meeting; provided, however, that no proxy shall be voted
on after three years from its date unless said proxy provides for a longer
period. At all meetings of the stockholders, all matters (except where other
provision is made by law or by the Certificate of Incorporation of the
Corporation) shall be decided by a majority of the votes cast by the holders
of the stock present in person or by proxy and entitled to vote thereat, a
quorum being present.

Section 2.7. List of Stockholders. It shall be the duty of the
--------------------
Secretary or other officer of the Corporation who shall have charge of its
stock ledger, either directly or through a transfer agent or transfer clerk
appointed by the Board of Directors, to prepare and make, at least 10 days
before every meeting of the stockholders for the election of directors of the
Corporation, a complete list of the stockholders entitled to vote thereat,
arranged in alphabetical order and showing the address of each stockholder
and the number of shares registered in the name of each stockholder. Such
list shall be open to the examination of any stockholder during ordinary
business hours, for a period of at least 10 days prior to the election,
either at a place within the city, town or village where the election is to
be held and which place shall be specified in the notice of meeting, or, if
not so specified, at the place where said meeting is to be held, and the list
shall be produced and kept at the time and place of said meeting during the
whole time thereof and subject to the inspection of any stockholder who shall
be present thereat. Upon the willful neglect or refusal of the directors to
produce such list at any election, they shall be ineligible for any office at
such election. The original or duplicate stock ledger shall be the only
evidence as to who are the stockholders entitled to examine such list or the
books of the Corporation or to vote in person or by proxy at such election.

Section 2.8. Judges of Election. The Board of Directors may appoint
------------------
judges of election to serve at any election of directors and at balloting on
any other matter that may properly come before a meeting of stockholders. If
no such appointment shall be made, or if any of the judges so appointed shall
fail to attend, or refuse or be unable to serve, then such appointment may be
made by the presiding officers at the meeting.

ARTICLE III

BOARD OF DIRECTORS
------------------

Section 3.1. General Powers. The property, affairs and business of
--------------
the Corporation shall be managed by or under the direction of the Board of
Directors.

Section 3.2. Number, Election, Qualifications and Term of Office.
---------------------------------------------------
The number of directors shall be as fixed from time to time by resolution of
the Board of Directors or stockholders (and such resolutions of either the
Board of Directors or stockholders being subject to the later resolution of
either of them). Until changed as provided herein, the initial Board of
Directors and all subsequent boards of directors shall consist of that number
of directors set forth in the Certificate of Incorporation. Except as
otherwise provided in the Certificate of Incorporation or in these Bylaws,
directors shall be elected by a plurality of the votes of the stockholders
entitled to vote at each meeting of stockholders for the election of a
director or directors. Directors need not be stockholders. Each director
shall hold office until his or her successor shall have been duly elected and
qualified, or until his or her death, or until he or she shall resign, or
until he or she shall have been removed in the manner hereinafter provided.

Section 3.3. Resignation. Any directors of the Corporation may
-----------
resign at any time by giving written notice to the President or to the
Secretary of the Corporation. The resignation of any director shall take ef-
fect at the time specified therein; and, unless otherwise specified therein,
the acceptance of such resignation shall not be necessary to make it
effective.

Section 3.4. Removal of Directors. Any director or the entire Board
--------------------
of Directors may be removed, either with or without cause, at any time by the
holders of a majority of the shares then entitled to vote at an election of
directors, except in the case that the Certificate of Incorporation of the
Corporation provides for cumulative voting, then if less than the entire
board is to be removed, no director may be removed without cause if the votes
cast against his or her removal would be sufficient to elect him or her if
then cumulatively voted at an election of the entire Board of Directors. Any
vacancy in the Board of Directors caused by any such removal may be filled by
a plurality of the votes of the stockholders at such meeting, or, if the
stockholders shall fail to fill such vacancy, by the Board of Directors.

Section 3.5. Vacancies. Any vacancy in the Board of Directors caused
---------
by death, resignation, disqualification, removal, an increase in the number
of directors, or any other cause, may be filled by the affirmative vote of a
majority of the remaining directors (though less than a quorum), unless
filled by the stockholders pursuant to Section 3.4 hereof; and each director
so chosen shall hold office until his or her successor shall be duly elected
and qualified or until his or her earlier death, resignation of removal.

Section 3.6. Place of Meetings, Etc. Except as otherwise
-----------------------
specifically provided by law, the Board of Directors may hold its meetings,
have one or more offices and keep the books and records of the Corporation at
such place or places within or without the State of Delaware as the Board of
Directors may from time to time determine.

Section 3.7. First Meeting. Within thirty (30) days after each
-------------
annual election of directors, the Board of Directors shall meet for the
purpose of organization, the election of officers and the transaction of
other business at the place where regular meetings of the Board of Directors
are held. Notice of such meeting shall be given in the manner hereinafter
provided for special meetings of the Board of Directors or in a consent and
waiver of notice thereof signed by all the directors.

Section 3.8. Regular Meetings. Regular meetings of the Board of
----------------
Directors may be held at such places and at such times as the Board shall
determine. If any day fixed for a regular meeting shall be a legal holiday
at the place where the meeting is to be held, then the meeting which would
otherwise be held on that day shall be held at such place at the same hour
and on the next succeeding business day not a legal holiday. Notice of
regular meetings need not be given, provided that, whenever the time or place
of regular meetings shall be fixed or changed, notice of such action shall be
mailed promptly to each director who shall not have been present at the
meeting at which such action was taken, addressed to him or her at his or her
residence or usual place of business.

Section 3.9. Special Meetings; Notice. Special meetings of the Board
------------------------
of Directors shall be held whenever called by the President or by one of the
directors. At least three calendar days before the day on which any special
meeting is to be held, notice of such meeting shall be sent to each director
by first class mail, addressed to him or her at his or her residence or usual
place of business, or shall be sent to him or her at such place by telegraph,
cable or wireless or shall be delivered personally or by telephone at least
one day before the day on which the meeting is to be held. Each such notice
shall state the time and place of the meeting but need not state the purposes
thereof, except as otherwise herein expressly provided. Notice of any
meeting of the Board of Directors need not be given to any director who shall
be present at such meeting or who shall, either before or after such meeting,
waive notice of such meeting in writing or by telegram, radio, cable or
telephone; and any meeting of the Board of Directors shall be a legal meeting
without any notice thereof having been given if all of the directors of the
Corporation then in office shall be present thereat.

Section 3.10. Quorum and Manner of Acting. Except as otherwise
---------------------------
provided by statute or by these Bylaws, one-third of the total number of
directors shall be required to constitute a quorum for the transaction of
business at any meeting, and the act of a majority of the directors present
at any meeting at which a quorum shall be present shall be the act of the
Board of Directors. In the absence of a quorum, a majority of the directors
present may adjourn any meeting from time to time until a quorum be had.
Notice of any adjourned meeting need not be given, except as required by law.

Section 3.11. Remuneration. Directors shall receive such reasonable
------------
compensation for their services, as such, whether in form of a salary or a
fixed fee for attendance at meetings, with expenses, if any, as the Board of
Directors may from time to time determine. Nothing herein contained shall be
construed so as to preclude any director from serving the Corporation in any
other capacity and receiving remuneration therefor.

Section 3.12. Action by Consent. Unless otherwise restricted by the
-----------------
Certificate of Incorporation or these Bylaws, any action required or
permitted to be taken at any meeting of the Board of Directors, or of any
committee thereof, may be taken without a meeting if all members of the Board
or of such committee, as the case may be, consent thereto in writing and such
writing or writings are filed with the minutes of proceedings of the Board or
committee.

Section 3.13. Telephonic Meetings. Unless otherwise restricted by
-------------------
the Certificate of Incorporation, members of the Board of Directors, or any
committee designated by the Board of Directors, may participate in a meeting
of the Board of Directors or committee by means of conference telephone or
similar communications equipment by means of which all persons participating
in the meeting can hear each other, and participation in a meeting pursuant
to this subsection shall constitute presence in person at such meeting.

ARTICLE IV
COMMITTEES
----------

Section 4.1. Designation of Committees, Alternate Members and Term of
--------------------------------------------------------
Office. The Board of Directors may, by resolution passed by a majority of
- ------
the whole Board, designate one or more committees, including an executive
committee, each committee to consist of one or more of the directors of the
Corporation. The Board of Directors may designate one or more directors as
alternate members of any committee, who, in the order specified by the Board,
may replace any absent or disqualified member at any meeting of the
committee. In the absence or disqualification of a member or members of a
committee, and in the event there are not sufficient alternate members
present at such meeting, the member or members thereof, including alternates,
present at any meeting and not disqualified from voting, whether or not he,
she or they constitute a quorum, may unanimously appoint another member of
the Board of Directors to act at the meeting in the place of any such absent
or disqualified member. The term of office of the members of each committee
shall be as fixed from time to time by the Board, subject to these Bylaws;
provided, however, that any committee member who ceases to be a member of the
Board shall ipso facto cease to be a committee member. Each committee shall
appoint a secretary, who may be the Secretary of the Corporation or any
Assistant Secretary thereof.

Section 4.2. Powers of Committees. Any committee designated by the
--------------------
Board of Directors pursuant to Section 4.1 hereof, to the extent provided in
the resolution of the Board of Directors, shall have and may exercise all the
powers and authority of the Board of Directors in the management of the
business and affairs of the Corporation, and may authorize the seal of the
Corporation to be affixed to all papers which may require it; but no such
committee shall have the power or authority in reference to amending the
Certificate of Incorporation, adopting an agreement of merger or
consolidation, recommending to the stockholders the sale, lease or exchange
of all or substantially all of the Corporation's property and assets,
recommending to the stockholders a dissolution of the Corporation or a
revocation of a dissolution, or amending these Bylaws of the Corporation;
and, unless the resolution so provides, no such committee shall have the
power or authority to declare a dividend or to authorize the issuance of
stock.

Section 4.3. Meetings, Notices and Records. Each committee may
-----------------------------
provide for the holding of regular meetings, with or without notice, and may
fix the time and place at which such meetings shall be held. Special
meetings of each committee shall be held upon call by or at the direction of
its chairman or, if there be no chairman, by or at the direction of any two
of is members, at the time and place specified in the respective notices or
waivers of notice thereof. Notice of each special meeting of a committee
shall be mailed to each member of such committee, addressed to him or her at
his or here residence or usual place of business, at least one day before the
day on which the meeting is to be held, or shall be sent by telegram, radio
or cable, addressed to him or her at such place, or telephoned or delivered
to him or her personally, not later than the day before the day on which the
meeting is to be held. Notice of any meeting of a committee need not be
given to any member thereof who shall attend the meeting in person or who
shall waive notice thereof by telegram, radio, cable or other writing.
Notice of any adjourned meeting need not be given. Each committee shall keep
a record of its proceedings.

Section 4.4. Quorum and Manner of Action. At each meeting of any
---------------------------
committee the presence of one-third of its members then in office shall be
necessary and sufficient to constitute a quorum for the transaction of
business, and the act of a majority of the members present at any meeting at
which a quorum is present shall be the act of such committee; in the absence
of a quorum, a majority of the members present at the time and place of any
meeting may adjourn the meeting from time to time until a quorum shall be
present. Subject to the foregoing and other provisions of these Bylaws and
except as otherwise determined by the Board of Directors, each committee may
make rules for the conduct of its business. Any determination made in
writing and signed by all the members of such committee shall be as effective
as if made by such committee at a meeting.

Section 4.5. Resignations. Any member of a committee may resign at
------------
any time by giving written notice of such resignation to the Board of
Directors, the President or the Secretary of the Corporation. Unless
otherwise specified in such notice, such resignation shall take effect upon
receipt thereof by the Board or any such officer.

Section 4.6. Removal. Any member of any committee may be removed at
-------
any time by the Board of Directors with or without cause.

Section 4.7. Vacancies. If any vacancy shall occur in any committee
---------
by reason of death, resignation, disqualification, removal or otherwise, the
remaining members of such committee, though less than a quorum, shall
continue to act until such vacancy is filled by the Board of Directors.

Section 4.8. Compensation. Committee members shall receive such
------------
reasonable compensation for their services as such, whether in the form of
salary or a fixed fee for attendance at meetings, with expenses, if any, as
the Board of Directors may from time to time determine. Nothing herein
contained shall be construed to preclude any committee member from servicing
the Corporation in any other capacity and receiving compensation therefor.

ARTICLE V
OFFICERS
--------

Section 5.1. Number. The officers of the Corporation shall be a
------
President, one or more Executive Vice Presidents, one or more Vice
Presidents, a Secretary, a Treasurer and, if the Board shall so elect, such
other officers and agents as may be appointed by the Board of Directors
pursuant to Section 5.3 hereof. Any two or more offices may be held by the
same person.

Section 5.2. Election, Term of Office and Qualifications. The
-------------------------------------------
officers shall be elected annually by the Board of Directors and, except in
the case of officers appointed in accordance with the provisions of Section
5.3 hereof, each shall hold office until the next annual election of officers
or until his or her successor shall have been duly elected and qualified, or
until his or her death, or until he or she shall resign, or until he or she
shall have been removed in the manner hereinafter provided.

Section 5.3. Other Officers. The Corporation may have such other
--------------
officers and agents as may be deemed necessary by the Board of Directors,
including without limitation one or more Assistant Secretaries and one or
more Assistant Treasurers. Such other officers and agents shall be appointed
in such manner, have such duties and hold their offices for such terms as may
be determined by the Board of Directors. The Board of Directors may delegate
to any officer or agent the power to appoint any such subordinate officers or
agents and to prescribe their respective terms of office, authorities and
duties.

Section 5.4. Resignations. Any officer may resign at any time by
------------
giving written notice of his or her resignation to the Board of Directors, to
the President or to the Secretary of the Corporation. Unless otherwise
specified in such written notice, any such resignation shall take effect at
the time of receipt thereof by the Board of Directors or any such officer.

Section 5.5. Removal. Any officer specifically designated in Section
-------
5.1 hereof may be removed, either with or without cause, by a vote of
majority of the whole Board of Directors. Any officer or agent appointed in
accordance with the provisions of Section 5.3 hereof may be removed, either
with or without cause, by the Board of Directors at any meeting, by the vote
of a majority of the directors present at such meeting, or by any superior
officer or agent upon whom such power or removal shall have been conferred by
the Board of Directors.

Section 5.6. Vacancies. A vacancy in any office by reason of death,
---------
resignation, removal or any other cause shall be filled for the unexpired
portion of the term in the manner prescribed in these Bylaws for election or
appointment to such office.

Section 5.7. The President. The President shall be the chief
-------------
executive officer of the Corporation and, subject to control by the Board of
Directors, shall have general charge of the business, affairs and property of
the Corporation and control over its several officers. He or she shall
preside at all meetings of the stockholders and of the Board of Directors and
of the Executive Committee at which he or she shall be present. He or she
shall see that all orders and resolutions of the Board of Directors are
carried into effect. He or she may sign, with the Secretary or any other
officer thereunto duly authorized by the Board of Directors, certificates for
shares of stock of the Corporation, deeds, mortgages, bonds, contracts,
agreements or other instruments duly authorized by the Board of Directors
except in cases where the signing and execution thereof shall be expressly
delegated by the Board of Directors to some other officer or agent. From
time to time he or she shall report to the Board of Directors all matters
within his or her knowledge which the interests of the Corporation may
require to be brought to their attention. The President shall do and perform
all such other duties and may exercise such other powers as from time to time
may be assigned to him or her by these Bylaws or by the Board of Directors or
by the Executive Committee or by the Executive Committee. The officers of
the Corporation shall be responsible to the President for the proper and
faithful discharge of their several duties and shall make such reports to him
or her as he or she may from time to time require.

Section 5.8. Executive Vice Presidents. In the event of the death,
-------------------------
absence, unavailability or disability of the President or at the request of
the President, the Executive Vice President or, in case there shall be more
than one Executive Vice President, the Executive Vice President designated by
the President (or in the absence of such designation, the Executive Vice
President designated by the Board of Directors) shall perform all the duties
of the President and, when so acting, shall have all the powers of, and be
subject to all the restrictions upon, the President. Except where by law the
signature of the President is required, each of the Executive Vice Presidents
shall possess the same power as the President to sign all certificates, con-
tracts, obligations and other instruments of the Corporation. Any Executive
Vice President shall perform such other duties and may exercise such other
powers as from time to time may be assigned to him or her by these Bylaws or
by the Board of Directors or by the Executive Committee or by the President.

Section 5.9. The Vice Presidents. The Vice Presidents shall exercise
-------------------
such powers as may be assigned to them from time to time by the Board of
Directors or by the Executive Committee or by the President.

Section 5.10. The Secretary and the Assistant Secretaries. The
-------------------------------------------
Secretary shall:

(a) Keep the minutes of the meetings of the stockholders, the Board of
Directors and the Executive Committee, and cause the same to be recorded in
books provided for that purpose;

(b) Prepare, or cause to be prepared, and submit to the Chairman of
each meeting of the stockholders a certified list, in alphabetical order, of
the names of the stockholders entitled to vote at such meeting, together with
the number of shares of stock held by each;

(d) Be custodian of the records of the Corporation, the Board of
Directors and the Executive Committee, and of the seal of the Corporation;
see that the seal is affixed to all stock certificates prior to their
issuance and to all documents the execution of which on behalf of the
Corporation under its seal shall have been duly authorized, and attest the
seal when so affixed;

(e) See that all books, reports, statements, certificates and the other
documents and records required by law to be kept or filed are properly kept
or filed;

(f) In general, perform all duties and have all powers incident to the
office of the Secretary and perform such other duties and have such other
powers as from time to time may be assigned to him or her by these Bylaws or
by the Board of Directors or by the President;

(g) Whenever any committee shall be appointed in pursuance of a
resolution of the Board of Directors, furnish the chairman of such committee
with a copy of such resolution;

(h) Have charge of the stock and transfer books of the Corporation, and
exhibit such stock book at all reasonable times to such persons as are
entitled by statute to have access thereto; and

(i) Sign (unless the Treasurer or any Assistant Secretary or an
Assistant Treasurer shall sign) certificates representing stock of the corpo-
ration the issuance of which shall have been duly authorized (the signature
to which may be a facsimile signature).

At the request of the Secretary, or in his or her absence or disability,
any Assistant Secretary shall perform any of the duties of the Secretary and,
when so acting, shall have all the powers of, and be subject to all the
restrictions upon, the Secretary. Except where by law the signature of the
Secretary is required, each of the Assistant Secretaries shall possess the
same power as the Secretary to sign certificates, contracts, obligations and
other instruments of the Corporation, and to affix the seal of the
Corporation to such instruments, and attest the same. The Assistant
Secretaries shall perform such other duties as from time to time may be
assigned to them respectively by the Board of Directors, the President or the
Secretary.

Section 5.11. The Treasurer and the Assistant Treasurers. The
------------------------------------------
Treasurer shall:

(a) Have charge of and supervision over and be responsible for the
funds, including the borrowing thereof, the securities, receipts and
disbursements of the Corporation;

(b) Cause all moneys and other valuable effects of the Corporation to
be deposited in the name and to the credit of the Corporation in such banks
or trust companies or with such bankers or other depositories as shall be
selected by the Board of Directors or Executive Committee, or pursuant to
authority conferred by the Board of Directors or Executive Committee;

(c) Cause the funds of the Corporation to be disbursed by checks or
drafts upon the authorized depositories of the Corporation;

(d) Cause to be taken and preserved proper vouchers for all moneys
disbursed;

(e) Cause to be kept correct books of account of all the business and
transactions of the Corporation and upon application cause such books of
account to be exhibited to any director;

(f) Render to the President, the Board of Directors of the Executive
Committee, whenever requested, an account of the financial conditions of the
Corporation and of his or her transactions at Treasurer;

(g) Be empowered, from time to time, to require from the officers or
agents of the Corporation reports or statements giving such information as he
or she may desire with respect to any and all financial transactions of the
Corporation;

(h) Sign (unless the Secretary or an Assistant Secretary or an
Assistant Treasurer shall sign) certificates representing stock of the Corpo-
ration the issuance of which shall have been duly authorized (the signature
to which may be a facsimile signature); and

(i) In general, perform all duties and have all powers incident to the
office of Treasurer and perform such other duties and have such other powers
as from time to time may be assigned to him or her by these Bylaws or by the
Board of Directors or by the President.

At the request of the Treasurer or, in his or her absence or disability,
the Assistant Treasurer or, in case there shall be more than one Assistant
Treasurer, the Assistant Treasurer designated by the Board of Directors or by
the Executive Committee or by the President shall perform any of the duties
of the Treasurer and, when so acting, shall have all the powers of, and be
subject to all the restrictions upon, the Treasurer. Except where by law the
signature of the Treasurer is required, each of the Assistant Treasurers
shall possess the same power as the Treasurer to sign all certificates,
contracts, obligations and other instruments of the Corporation. The
Assistant Treasurers shall perform such other duties as from time to time may
be assigned to them respectively by the Board of Directors, the President or
the Treasurer.

Section 5.12. Salaries. The salaries of the officers shall be fixed
--------
from time to time by the Board of Directors, except that the Board of
Directors may delegate to any person the power to fix the salaries or other
compensation of any officers or agents appointed in accordance with the
provisions of Section 5.3 hereof. No officer shall be prevented from
receiving such salary by reason of the fact that he or she is also a director
of the Corporation.

Section 5.13. Surety Bonds. If the Board of Directors shall so
------------
require, any officer or agent of the Corporation shall execute to the
Corporation a bond in such sum and with such surety or sureties as the Board
of Directors may direct, conditioned upon the faithful discharge of his or
her duties, including responsibility for negligence and for the accounting
for all property, funds or securities of the Corporation which may come into
his or her hand.

ARTICLE VI
CONTRACTS, CHECKS, LOANS, DEPOSITS AND PROXIES
----------------------------------------------

Section 6.1. Contracts, Checks, Etc. All contracts and agreements
-----------------------
authorized by the Board of Directors, and all checks, drafts, bills of
exchange or other orders for the payment of money, notes or other evidences
of indebtedness issued in the name of the Corporation shall be signed by such
officer or officers, or agent or agents, as may,from time to time be
designated by the Board of Directors, which designation may be general or
confined to specific instances. The President, an Executive Vice President
or a Vice President and the Treasurer shall have the power and authority to
bind the Corporation by contract or engagement or to pledge its credit or to
render it liable pecuniarily for any purpose or for any amount; and no other
officer, agent or employee of the Corporation shall have any such power and
authority unless so designated by the Board of Directors or in or pursuant to
the provisions of these Bylaws.

Section 6.2. Proxies in Respect of Securities of Other Corporations.
------------------------------------------------------
Unless otherwise provided by resolution adopted by the Board of Directors,
the President or an Executive Vice President may from time to time appoint an
attorney or attorneys, or an agent or agents, to exercise in the name and on
behalf of the Corporation the powers and rights which the Corporation may
have as the holder of stock or other securities in any other corporation to
vote or to consent in respect of such stock or other securities; and the
President or any Executive Vice President may instruct the person or persons
so appointed as to the manner or exercising such powers and rights and the
President or any Executive Vice President may execute or cause to be executed
in the name and on behalf of the Corporation and under its corporate seal, or
otherwise, all such written proxies, power of attorney or other written
instruments as he or she may deem necessary in order that the Corporation may
exercise such powers and rights.

Section 6.3. Deposits. All funds of the Corporation not otherwise
--------
employed shall be deposited from time to time to its credit in such banks or
trust companies or with such bankers or other depositories as the Board of
Directors may select, or as may be selected by any officer or officers or
agent or agents authorized so to do by the Board of Directors. Endorsements
for deposit to the credit of the Corporation in any of its duly authorized
depositories shall be made in such manner as the Board of Directors from time
to time may determine.

ARTICLE VII

CERTIFICATES OF STOCK
---------------------

Section 7.1. Form; Signature. The certificates of stock of the
---------------
Corporation shall be numbered and shall be entered in the books of the
Corporation as they are issued. They shall exhibit the holder's name and
number of shares and shall be signed by the President, an Executive Vice
President or a Vice President and the Treasurer or an Assistant Treasurer, or
the Secretary or an Assistant Secretary.

Section 7.2. Transfer. Transfers of stock shall be made on the books
--------
of the Corporation only by the person named in the certificate or by his or
her attorney, lawfully constituted in writing, and upon surrender of the
certificate therefor.

Section 7.3. Record Dates. In order that the Corporation may
------------
determine the stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, or to express consent to corporate
action in writing without a meeting, or entitled to receive payment of any
dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock
or for the purpose of any other lawful action, the Board of Directors may, in
its discretion, fix, in advance, a record date, which shall be not more than
60 nor less than 10 days before the date of such meeting, nor more than 60
days prior to any other action. Only those stockholders of record on the
date so fixed shall be entitled to any of the foregoing rights, notwithstand-
ing the transfer of any such stock on the books of the Corporation after any
such record date fixed by the Board of Directors. A determination of
stockholders of record entitled to notice of or to vote at a meeting of
stockholders shall apply to any adjournment of the meeting; provided,
however, that the Board of Directors may fix a new record date for the
adjourned meeting.

Section 7.4. Closing of Transfer Books. The Board of Directors may
-------------------------
close the transfer books in its' discretion for a period not exceeding 60
days preceding any meeting, annual or special, of the stockholders or the day
appointed for the payment of a dividend.

Section 7.5. Record Owner. The Corporation shall be entitled to
------------
treat the holder of record of any share or shares of stock as the holder in
fact thereof and accordingly shall not be bound to recognize any equitable or
other claim to or interest in such share on the part of any other person,
whether or not it shall have express or other notice thereof, unless the laws
of Delaware expressly provide otherwise.

Section 7.6. Lost Certificates. Any person claiming a certificate of
-----------------
stock to be lost or destroyed shall make an affidavit or affirmation of that
fact and advertise the same in such manner as the Board of Directors may
require, and shall if the directors so require give the Corporation a bond of
indemnity, in form and with one or more sureties satisfactory to the Board of
Directors, in at least double the value of the stock represented by said
certificate, whereupon a new certificate may be issued of the same tenor and
for the same number of shares as the one alleged to be lost or destroyed.

ARTICLE VIII
DIVIDENDS
---------

Dividends upon the capital stock of the Corporation, when earned, may be
declared by the Board of Directors at any regular or special meeting.

Before payment of any dividend or making any distribution of profits,
there may be set aside out of the surplus or net profits of the Corporation
such sum or sums as the directors from time to time, in their absolute
discretion, think proper as a reserve fund to meet contingencies, or for
equalizing dividends, or for repairing or maintaining any property of the
Corporation, or for such other purpose as the directors shall think conducive
to the interests of the Corporation.

ARTICLE IX

RELIANCE ON RECORDS AND REPORTS
-------------------------------

Each director, officer or member of any committee designated by, or by
authority of, the Board of Directors shall, in the performance of his or her
duties, be fully protected in relying in good faith upon the books of account
or other records of the Corporation or of any of its subsidiaries or upon
reports made to the Corporation or any of its subsidiaries by any official of
the Corporation or of a subsidiary or by an independent certified public
accountant or by an appraiser selected with reasonable care by the Board of
Directors or by any such committee.

ARTICLE X
CORPORATE SEAL
--------------

The corporate seal shall be circular in form and shall bear the name of
the Corporation and words and figures denoting its organization under the
laws of the State of Delaware and otherwise shall be in such form as shall be
approved from time to time by the Board of Directors.

ARTICLE XI

FISCAL YEAR
-----------

The fiscal year of the Corporation shall be such 12-month period of each
calendar year as may be fixed from time to time by resolution of the Board of
Directors.

ARTICLE XII
WAIVER OF NOTICE
----------------

Whenever any notice whatsoever is required to be given by these Bylaws
or the Certificate of Incorporation of the Corporation or any of the
corporate laws of the State of Delaware, a waiver thereof in writing, signed
by the person or persons entitled to said notice, whether before of after the
time stated therein, shall be deemed equivalent thereto.

ARTICLE XIII
AMENDMENTS
----------

The Bylaws of the Corporation, regardless of whether made by the
stockholders or by the Board of Directors, may be amended, added to or
repealed at any meeting of the Board of Directors or of the stockholders
provided that notice of the proposed change is given in the notice of the
meeting. No change of the time or place for the annual meeting of the
stockholders for the election of directors shall be made except in accordance
with the laws of the State of Delaware.

March 6, 1998

Structured Asset Securities Corporation
200 Vesey Street
New York, New York 10285

Re: Structured Asset Securities Corporation,
Registration Statement on Form S-3
----------------------------------

Ladies and Gentlemen:

We will act as counsel for Structured Asset Securities Corporation,
a Delaware corporation (the "Company"), in connection with the offering, from
time to time, in one or more Series (each, a "Series") of the Company's
Mortgage Pass-Through Certificates (the "Securities"). The Securities are
being registered pursuant to the Securities Act of 1933, as amended (the
"Act"), by means of a Registration Statement of the Company on Form S-3. The
Securities will be offered pursuant to the prospectus, as supplemented by a
prospectus supplement (the "Base Prospectus" and "Prospectus Supplement,"
respectively), which will be filed with the Commission pursuant to Rule 424
under the Securities Exchange Act. As set forth in the Registration
Statement, each Series of Securities will be issued under and pursuant to the
conditions of a separate trust agreement (the "Trust Agreement") among the
Company, a trustee (the "Trustee") and where appropriate, a servicer or
master servicer (the "Servicer"), each to be identified in the prospectus
supplement for such Series of Securities.

We have examined copies of the Company's Amended and Restated
Articles of Incorporation, Bylaws, the form of Trust Agreement (as
incorporated by reference as an exhibit to the Registration Statement), the
forms of Securities included in the Trust Agreement and such other records,
documents and statutes as we have deemed necessary for purposes of this
opinion.

Based upon the foregoing, we are of the opinion that:

1. When any Trust Agreement relating to a Series of Securities
has been duly and validly authorized by all necessary action on the part
of the Company and has been duly executed and delivered by the Company,
the Servicer, the Trustee and any other party thereto, such Trust
Agreement will constitute a legal, valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms,
except as enforcement thereof may be limited by bankruptcy, insolvency
or other laws relating to or affecting creditors' rights generally or by
general equity principles.

2. When a Series of Securities has been duly authorized by all
necessary action on the part of the Company (subject to the terms
thereof being otherwise in compliance with applicable law at such time),
duly executed and authenticated by the Trustee for such Series in
accordance with the terms of the related Agreement and issued and
delivered against payment therefor as described in the Registration
Statement, such Series of Securities will be legally and validly issued,
fully paid and nonassessable, and the holders thereof will be entitled
to the benefits of the related Agreement.

We have also advised the Company with respect to certain federal
income tax consequences of the proposed issuance of the Securities. This
advice is summarized under "Certain Federal Income Tax Considerations" in the
Base Prospectus. Such description does not purport to discuss all possible
federal income tax ramifications of the proposed issuance, but with respect
to those federal income tax consequences that are discussed, in our opinion,
the description is accurate in all material respects.

In rendering the foregoing opinions, we express no opinion as to
the laws of any jurisdiction other than the laws of the State of New York
(excluding choice of law principles therein) and the federal laws of the
United States of America.

We hereby consent to the filing of this letter and to the
references to this firm under the headings "Legal Opinions" and "Certain
Federal Income Tax Considerations" in the Base Prospectus and Prospectus
Supplement, without implying or admitting that we are "experts" within the
meaning of the Act or the rules and regulations of the Commission issued
thereunder, with respect to any part of the Base Prospectus or Prospectus
Supplement.

Very truly yours,

/s/ Brown & Wood LLP