<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): September 16, 1996
GREEN TREE FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 01-08916 41-1807858
- ---------------------------- ------------------------ -------------------
(State or other Jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
1100 Landmark Towers, 345 St. Peter Street, Saint Paul, Minnesota 55102-1639
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(Address of principal executive offices)
Registrant's telephone number, including area code: (612) 293-3400
--------------
Not Applicable
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(Former name or former address, if changed since last report)
<PAGE>
ITEM 1. Changes in Control of Registrant.
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Not applicable.
ITEM 2. Acquisition or Disposition of Assets.
- ------- ------------------------------------
Not applicable
ITEM 3. Bankruptcy or Receivership.
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Not applicable
ITEM 4. Changes in Registrant's Certifying Accounting.
- ------- ---------------------------------------------
Not applicable
ITEM 5. Other Events.
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Not applicable.
ITEM 6. Resignations of Registrant's Directors.
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Not applicable
ITEM 7. Financial Statements and Exhibits.
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(a) Financial statements of businesses acquired.
Not applicable
(b) Pro forma financial information.
Not applicable
2
<PAGE>
(c) Exhibits.
The following is filed herewith. The exhibit numbers correspond
with Item 601(b) of Regulation S-K.
Exhibit No. Description
----------- -----------
99.1 External Computational and Descriptive
Information distributed in connection with
$367,733,592 Certificates for Home
Improvement and Home Equity Loans, Series
1996-D.
99.2 External Computational and Descriptive
Information distributed in connection with
$27,088,323 Certificates for Home
Improvement Loans, Series 1996-E.
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: September 18, 1996 GREEN TREE FINANCIAL CORPORATION
By: /s/ Phyllis A. Knight
_____________________________
Phyllis A. Knight
Vice President and Treasurer
3
<PAGE>
INDEX TO EXHIBITS
Exhibit
-------
Number Page
------ ----
99.1 External Computational and Descriptive 5
Information distributed in connection
with $367,733,592 Certificates for Home
Improvement and Home Equity Loans,
Series 1996-D.
99.2 External Computational and Descriptive
Information distributed in connection
with $27,088,323 Certificates for Home
Improvement Loans, Series 1996-E.
4
<PAGE>
Exhibit 99.1
TERM SHEET DATED SEPTEMBER 16, 1996
GREEN TREE FINANCIAL CORPORATION
CERTIFICATES FOR HOME IMPROVEMENT AND HOME EQUITY LOANS, SERIES 1996-D
$367,733,592 (APPROXIMATE)
Subject to Revision
SELLER/SERVICER: Green Tree Financial Corporation ("Green Tree").
TRUSTEE: First Trust National Association
UNDERWRITERS: Merrill Lynch (Lead), Lehman Brothers (Co).
<TABLE>
<CAPTION>
Ratings WAL Exp Final
Amount (S&P/Fitch) at 15% CPR Maturity
------ ----------- ---------- ---------
<S> <C> <C> <C> <C>
To Call:
HI: A-1 $65,000,000 AAA/AAA 1.08 28
HI: A-2 $33,000,000 AAA/AAA 3.09 49
HI: A-3 $45,220,000 AAA/AAA 5.91 101
HI: M-1 $14,810,000 AA/AA 9.41 118
HI: M-2 $ 8,970,000 A/A 9.79 118
HI: B-1 $ 7,180,000 BBB/BBB 5.14 87
HI: B-2 $ 5,382,937 A-/A 9.05 118
To Maturity
HI: M-1 $14,810,000 AA/AA 9.98 147
HI: M-2 $ 8,970,000 A/A 15.26 299
HI: B-2 $ 5,382,937 A-/A 10.80 299
</TABLE>
<TABLE>
<CAPTION>
Ratings WAL Exp Final
Amount (S&P/Fitch) at 100% Base* Maturity
------ ----------- ------------- ---------
<S> <C> <C> <C> <C>
To Call:
HE: A-1 $62,000,000 AAA/AAA 1.06 24
HE: A-2 $54,000,000 AAA/AAA 3.06 54
HE: A-3 $18,000,000 AAA/AAA 5.08 70
HE: A-4 $29,260,000 AAA/AAA 7.48 118
HE: M-1 $ 9,400,000 AA/AA+ 9.79 118
HE: M-2 $ 6,580,000 A/AA 9.79 118
HE: B-1 $ 6,580,000 BBB/A 5.38 103
HE: B-2 $ 2,350,655 A-/A 9.62 118
To Maturity
HE: M-1 $ 9,400,000 AA/AA+ 11.23 157
HE: M-2 $ 6,580,000 A/AA 14.84 357
HE: B-2 $ 2,350,655 A-/A 11.72 357
</TABLE>
CUT-OFF DATE: September 1, 1996 (or the date of origination, if later)
EXP. PRICING: September 18, 1996
EXP. SETTLEMENT: September 30, 1996
LEGAL FINAL: Home Improvement (secured) - July 2027
Home Equity - September 2027
- ----------------------
* 100% Base (100% Prepayment Assumption) assumes a conditional prepayment rate
of 4% per annum of the then outstanding principal balance of the Home Equity
Contracts in the first month of the life of the Home Equity Contracts and an
additional 1.45% (precisely, 16/11%) per annum in each month thereafter until
the twelfth month. Beginning in twelfth month and in each month thereafter,
the conditional prepayment rate is 20%.
[MERRILL LYNCH LOGO] 1
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Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
INTEREST/PRINCIPAL: The 15th day of each month (or if such 15th day is not a
business day, the next succeeding business day), commencing
on October 15, 1996.
CROSS
COLLATERALIZATION: On each Payment Date the Amount Available for each Sub-Pool
remaining after making distributions to the related
Certificates will generally be available to make
distributions to the Certificates related to the other Sub-
Pool.
ERISA: Class HI:A and Class HE:A Certificates are ERISA eligible.
The Class HI: M-1, HE:M-1, HI:M-2, HE:M-2, HI:B-1, HE:B-1,
HI:B-2 and HI:B-2 Certificates will not be sold to benefit
plans unless such plans deliver a legal opinion to the
Trustee stating that assets of the Trust are not deemed
"plan assets".
TAX STATUS: The Trust will elect to be treated as a REMIC for federal
income tax purposes.
HOME IMPROVEMENT CERTIFICATE STRUCTURE
CREDIT ENHANCEMENT: Class HI:A: 20.25% subordination (Class HI:M-1, HI:M-2,
HI:B-1, and HI:B-2) & Residual (Class C)
Class HI:M-1: 12.00% subordination (Class HI:M-2, HI:B-1
and HI:B-2) & Residual (Class C)
Class HI:M-2: 7.00% subordination (Class HI:B-1 and HI:B-2)
& Residual (Class C)
Class HI:B-1: 3.00% subordination (Class HI:B-2) & Residual
(Class C)
Class HI:B-2: Limited Guaranty plus Residual (Class C)
DISTRIBUTIONS: The Sub-Pool HI Amount Available will generally consist of
payments made on or in respect of the Home Improvement
Contracts comprising Sub-Pool HI, and will include amounts
otherwise payable to the Servicer (as long as Green Tree is
the Servicer) as the Monthly Servicing Fee with respect to
the Home Improvement Contracts, and to the Class C
Certificateholder.
The Amount Available will generally be applied first to the
distributions to the Class HI:A Certificateholders, then to
the Class HI:M Certificateholders, and then to the Class
HI:B Certificateholders.
Class HI:A Certificates are senior to Class HI:M and Class
HI:B Certificates. Class HI:M Certificates are senior to
Class HI:B Certificates.
CLASS HI:A INTEREST Interest will be paid concurrently on each Class of Class
HI:A Certificates at the related Pass-Through Rate on the
then outstanding related Class Principal Balance. Interest
will accrue from the Settlement Date, or from the most
recent Payment Date on which interest has been paid to but
excluding the following Payment Date. Interest will be
computed on 30/360 basis.
Interest shortfall will be carried forward, and will bear
interest at the applicable Class HI:A Pass-Through Rate, to
the extent legally permissible.
[MERRILL LYNCH LOGO] 2
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Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
CLASS HI:A PRINCIPAL After payment of all interest distributable to the Class
HI:A Certificateholders, the Sub-Pool HI Senior
Percentage of the Sub-Pool HI Formula Principal
Distribution Amount will be distributed first to the
Class HI:A-1 Certificateholders, until the Class HI:A-1
Principal Balance has been reduced to zero, then to the
Class HI:A-2 Certificateholders until the Class HI:A-2
Principal Balance has been reduced to zero, and then
to the Class HI:A-3 Certificateholders until the Class
HI:A-3 Principal Balance has been reduced to zero.
The Sub-Pool HI Senior Percentage will equal 100% if any
of the following exist:
i) it is prior to October 1999 (Month 36);
ii) the Class HI:B Principal Balance represents less
than 14% of the Scheduled Principal Balance of Sub-
Pool HI; and
iii) each Class HI:B Principal Distribution Test (See
below) is not satisfied.
Otherwise, the Senior Percentage will equal a fraction,
the numerator of which is the sum of the Class HI:A
Principal Balance and the Class HI:M Principal Balance
for a given Payment Date, and the denominator of which is
the Scheduled Principal Balance of Sub-Pool HI for the
immediately preceding Payment Date.
CLASS HI:M-1 INTEREST After payment of Class HI:A Distribution Amount, interest
will be paid to the Class HI:M-1 Certificateholders in an
amount equal to the product of (a) the Class HI:M-1 Pass-
Through Rate and (b) the then outstanding Class HI:M-1
Principal Balance less the Class HI:M-1 Liquidation Loss
Principal Amount. Interest will accrue from the
Settlement Date, or from the most recent Payment Date on
which interest has been paid, to but excluding the
following Payment Date. Interest will be computed on
30/360 basis.
Interest shortfall will be carried forward, and will bear
interest at the Class HI:M-1 Pass-Through Rate, to the
extent legally permissible.
CLASS HI:M-1 PRINCIPAL Class HI:M-1 Certificateholders will not receive
principal until Class HI:A Principal Balance has been
reduced to zero. At that time Class HI:M-1 will be
entitled to receive the Sub-Pool HI Senior Percentage of
the Sub-Pool HI Formula Principal Distribution Amount,
until the Class HI:M-1 Principal Balance has been reduced
to zero.
CLASS HI:M-2 INTEREST After payment of Class HI:A and Class HI:M-1 Distribution
Amount, interest will be paid to the Class HI:M-2
Certificateholders in an amount equal to the product of
(a) the Class HI:M-2 Pass-Through Rate and (b) the then
outstanding Class HI:M-2 Principal Balance less the Class
HI:M-2 Liquidation Loss Principal Amount. Interest will
accrue from the Settlement Date, or from the most recent
Payment Date on which interest has been paid, to but
excluding the following Payment Date. Interest will be
computed on 30/360 basis.
Interest shortfall will be carried forward, and will bear
interest at the Class HI:M-2 Pass-Through Rate, to the
extent legally permissible.
CLASS HI:M-2 PRINCIPAL Class HI:M-2 Certificateholders will not receive
principal until Class HI:A and Class HI:M-1 Principal
Balances have been reduced to zero. At that time Class
HI:M-2 will be entitled to receive the Sub-Pool HI Senior
Percentage of the Sub-Pool HI Formula Principal
Distribution Amount, until the Class HI:M-2 Principal
Balance has been reduced to zero.
[MERRILL LYNCH LOGO] 3
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Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
CLASS HI:B-1 INTEREST After payment of Class HI:A, Class HI:M-1 and Class
HI:M-2 Distribution Amount, interest will be paid to the
Class HI:B-1 Certificateholders in an amount equal to
the product of (a) the Class HI:B-1 Pass-Through Rate
and (b) the then outstanding Class HI:B-1 Principal
Balance less the Class HI:B-1 Liquidation Loss Principal
Amount. Interest will accrue from the Settlement Date,
or from the most recent Payment Date on which interest
has been paid, to but excluding the following Payment
Date. Interest will be computed on 30/360 basis.
Interest shortfall will be carried forward, and will
bear interest at the Class HI:B-1 Pass-Through Rate, to
the extent legally permissible.
CLASS HI:B-1 PRINCIPAL The Class HI:B-1 Certificateholders will not receive
principal payments until the Class HI:B Cross-over Date.
At that time, to the extent of the amount available
after payment of Class HI:A, Class HI:M Distribution
Amounts and Class HI:B-1 interest, Class HI:B-1
Certificateholders will receive the Class HI:B
Percentage of the Sub-Pool HI Formula Principal
Distribution Amount until Class HI:B-1 Principal Balance
has been reduced to zero.
The Class HI:B Percentage will be equal to 100% minus
the Sub-Pool HI Senior Percentage if on or after October
1999, the Class HI:B Principal Balance represents more
than 14% of the Scheduled Principal Balance of Sub-Pool
HI, and each of the Class HI:B Principal Distribution
Tests (See below) are satisfied. The Class HI:B
Percentage after the Class HI:A and Class HI:M Principal
Balances have been reduced to zero will be equal to
100%.
CLASS HI:B-2 INTEREST After payment of Class HI:A, Class HI:M-1, Class HI:M-2
and Class HI:B-1 Distribution Amounts, interest will be
paid to the Class HI:B-2 Certificateholders in an amount
equal to the product of (a) the Class HI:B-2 Pass-
Through Rate and (b) the then outstanding Class HI:B-2
Principal Balance less the Class HI:B-2 Liquidation Loss
Principal Amount. The Limited Guaranty will be available
to pay interest to the Class HI:B-2 Certificateholders
if the Sub-Pool HI Amount Available is not sufficient.
Interest will accrue from the Settlement Date, or from
the most recent Payment Date on which interest has been
paid, to but excluding the following Payment Date.
Interest will be computed on 30/360 basis.
Interest shortfall will be carried forward, and will
bear interest at the Class HI:B-2 Pass-Through Rate, to
the extent legally permissible.
CLASS HI:B-2 PRINCIPAL The Class HI:B-2 Certificateholders will not receive
principal payments until the Class HI:B-1 Principal
Balance has been reduced to zero. At that time, if each
Class HI:B Principal Distribution Test is satisfied
(unless the Class HI:A and Class HI:M Principal Balances
have been reduced to zero), to the extent of the amount
available after payment of the Class HI:A, the Class
HI:M and the Class HI:B-1 Distribution Amounts and any
amounts actually paid under the Class HI:B-2 Limited
Guaranty, the Class HI:B-2 Certificateholders will
receive the Class HI:B Percentage of the Sub-Pool HI
Formula Principal Distribution Amount until Class HI:B-2
Principal Balance has been reduced to zero.
On each Payment Date, the Class HI:B-2
Certificateholders will be entitled to receive pursuant
to the Class HI:B-2 Limited Guaranty, the Class HI:B-2
Liquidation Loss Principal Amount until the Class HI:B-2
Principal Balance has been reduced to zero.
[MERRILL LYNCH LOGO] 4
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Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
LOSSES ON LIQUIDATED
HI CONTRACTS: If Net Liquidation Proceeds from Liquidated Contracts in
the respective collection period are less than the
Scheduled Principal Balance of such Liquidated Contract
plus accrued and unpaid interest thereon, the deficiency
will be absorbed by the Class C Certificateholder, then the
Guaranty Fee otherwise payable to the Company, then the
Monthly Servicing Fee otherwise payable to the Servicer (as
long as Green Tree is the Servicer), then the Class HI:B-2
Certificateholders, then the Class HI:B-1
Certificateholders, then the Class HI:M-1
Certificateholders and then the Class HI:M-2
Certificateholders.
CLASS HI:B-2 LIMITED
GUARANTY To the extent that the Sub-Pool HI Amount Available is not
sufficient, the Limited Guaranty will be available to pay
the Class HI:B-2 Liquidation Loss Principal Amount and the
Class HI:B-2 Distribution Amount. The Class HI:B-2 Limited
Guaranty will be an unsecured general obligation of the
Company.
CLASS HI:B PRINCIPAL
DISTRIBUTION TESTS: (i) the Sub-Pool HI Average Sixty-Day Delinquency Ratio
with respect to Sub-Pool HI as of given Payment Date
must not exceed 2.5%;
(ii) the Sub-Pool HI Average Thirty-Day Delinquency Ratio
with respect to Sub-Pool HI as of given Payment Date
must not exceed 5%;
(iii) the Sub-Pool HI Cumulative Realized Losses with
respect to Sub-Pool HI as of given Payment Date must
not exceed a certain specified percentage of the Cut-
off Date Pool Principal Balance of Sub-Pool HI,
depending on the year in which such Payment Date
occurs;
(iv) the Sub-Pool HI Current Realized Loss Ratio with
respect to Sub-Pool HI as of given Payment Date must
not exceed 2.5%; and
(v) the Class HI:B Principal Balance divided by the Pool
Scheduled Principal Balance of Sub-Pool HI as of the
immediately preceding Payment Date must be equal or
greater than 14%.
HOME EQUITY CERTIFICATE STRUCTURE
CREDIT ENHANCEMENT: Class HE:A: 13.25% subordination (Class HE:M-1, HE:M-2,
HE:B-1, and HE:B-2) & Residual (Class C)
Class HE:M-1: 8.25% subordination (Class HE:M-2, HE:B-1
and HE:B-2) & Residual (Class C)
Class HE:M-2: 4.75% subordination (Class HE:B-1 and HE:B-2)
& Residual (Class C)
Class HE:B-1: 1.25% subordination (Class HE:B-2) & Residual
(Class C)
Class HE:B-2: Limited Guaranty plus Residual (Class C)
DISTRIBUTIONS: The Sub-Pool HE Amount Available will generally consist of
payments made on or in respect of the Home Equity Contracts
comprising Sub-Pool HE, and will include amounts otherwise
payable to the Servicer (as long as Green Tree is the
Servicer) as the Monthly Servicing Fee with respect to the
Home Equity Contracts, and to the Class C
Certificateholder.
The Amount Available will generally be applied first to the
distributions to the Class HE:A Certificateholders, then to
the Class HE:M Certificateholders, and then to the Class
HE:B Certificateholders.
Class HE:A Certificates are senior to Class HE:M and Class
HE:B Certificates. Class HE:M Certificates are senior to
Class HE:B Certificates.
[MERRILL LYNCH LOGO] 5
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Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
CLASS HE:A INTEREST Interest will be paid concurrently on each Class of Class
HE:A Certificates at the related Pass-Through Rate on the
then outstanding related Class Principal Balance.
Interest will accrue from the Settlement Date, or from
the most recent Payment Date on which interest has been
paid to but excluding the following Payment Date.
Interest will be computed on 30/360 basis.
Interest shortfall will be carried forward, and will bear
interest at the applicable Class HE:A Pass-Through Rate,
to the extent legally permissible.
CLASS HE:A PRINCIPAL After payment of all interest distributable to the Class
HE:A Certificateholders, the Sub-Pool HE Senior
Percentage of the Sub-Pool HE Formula Principal
Distribution Amount will be distributed first to the
Class HE:A-1 Certificateholders, until the Class HE:A-1
Principal Balance has been reduced to zero, then to the
Class HE:A-2 Certificateholders until the Class HE:A-2
Principal Balance has been reduced to zero, then to the
Class HE:A-3 Certificateholders until the Class HE:A-3
Principal Balance has been reduced to zero, and then to
the Class HE:A-4 Certificateholders until the Class HE:
A-4 Principal Balance has been reduced to zero
The Sub-Pool HE Senior Percentage will equal 100% if any
of the following exist:
i) it is prior to October 1999 (Month 36);
ii) the Class HE:B Principal Balance represents less
than 9.50% of the Scheduled Principal Balance of
Sub-Pool HE; and
iii) each Class HE:B Principal Distribution Test (See
below) is not satisfied.
Otherwise, the Senior Percentage will equal a fraction,
the numerator of which is the sum of the Class HE:A
Principal Balance and the Class HE:M Principal Balance
for a given Payment Date, and the denominator of which is
the Scheduled Principal Balance of Sub-Pool HE for the
immediately preceding Payment Date.
CLASS HE:M-1 INTEREST After payment of Class HE:A Distribution Amount, interest
will be paid to the Class HE:M-1 Certificateholders in an
amount equal to the product of (a) the Class HE:M-1 Pass-
Through Rate and (b) the then outstanding Class HE:M-1
Principal Balance less the Class HE:M-1 Liquidation Loss
Principal Amount. Interest will accrue from the
Settlement Date, or from the most recent Payment Date on
which interest has been paid, to but excluding the
following Payment Date. Interest will be computed on
30/360 basis.
Interest shortfall will be carried forward, and will bear
interest at the Class HE:M-1 Pass-Through Rate, to the
extent legally permissible.
CLASS HE:M-1 PRINCIPAL Class HE:M-1 Certificateholders will not receive
principal until Class HE:A Principal Balance has been
reduced to zero. At that time Class HE:M-1 will be
entitled to receive the Sub-Pool HE Senior Percentage of
the Sub-Pool HE Formula Principal Distribution Amount,
until the Class HE:M-1 Principal Balance has been reduced
to zero.
CLASS HE:M-2 INTEREST After payment of Class HE:A and Class HE:M-1 Distribution
Amount, interest will be paid to the Class HE:M-2
Certificateholders in an amount equal to the product of
(a) the Class HE:M-2 Pass-Through Rate and (b) the then
outstanding Class HE:M-2 Principal Balance less the Class
HE:M-2 Liquidation Loss Principal Amount. Interest will
accrue from the Settlement Date, or from the most recent
Payment Date on which interest has been paid, to but
excluding the following Payment Date. Interest will be
computed on 30/360 basis.
[MERRILL LYNCH LOGO] 6
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Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
Interest shortfall will be carried forward, and will bear
interest at the Class HE:M-2 Pass-Through Rate, to the
extent legally permissible.
CLASS HE:M-2 PRINCIPAL Class HE:M-2 Certificateholders will not receive
principal until Class HE:A and Class HE:M-1 Principal
Balances have been reduced to zero. At that time Class
HE:M-2 will be entitled to receive the Sub-Pool HE Senior
Percentage of the Sub-Pool HE Formula Principal
Distribution Amount, until the Class HE:M-2 Principal
Balance has been reduced to zero.
CLASS HE:B-1 INTEREST After payment of Class HE:A, Class HE:M-1 and Class HE:
M-2 Distribution Amounts, interest will be paid to the
Class HE:B-1 Certificateholders in an amount equal to the
product of (a) the Class HE:B-1 Pass-Through Rate and (b)
the then outstanding Class HE:B-1 Principal Balance less
the Class HE:B-1 Liquidation Loss Principal Amount.
Interest will accrue from the Settlement Date, or from
the most recent Payment Date on which interest has been
paid, to but excluding the following Payment Date.
Interest will be computed on 30/360 basis.
Interest shortfall will be carried forward, and will bear
interest at the Class HE:B-1 Pass-Through Rate, to the
extent legally permissible.
CLASS HE:B-1 PRINCIPAL The Class HE:B-1 Certificateholders will not receive
principal payments until the Class HE:B Cross-over Date.
At that time, to the extent of the amount available after
payment of Class HE:A, Class HE:M Distribution Amounts
and Class HE:B-1 interest, Class HE:B-1
Certificateholders will receive the Class HE:B Percentage
of the Sub-Pool HE Formula Principal Distribution Amount
until Class HE:B-1 Principal Balance has been reduced to
zero.
The Class HE:B Percentage will be equal to 100% minus the
Sub-Pool HE Senior Percentage if on or after October
1999, the Class HE:B Principal Balance represents more
than 9.50% of the Scheduled Principal Balance of Sub-Pool
HE, and each of the Class HE:B Principal Distribution
Tests (See below) are satisfied. The Class HE:B
Percentage after the Class HE:A and Class HE:M Principal
Balances have been reduced to zero will be equal to 100%.
CLASS HE:B-2 INTEREST After payment of Class HE:A, Class HE:M-1, Class HE:M-2
and Class HE:B-1 Distribution Amounts, interest will be
paid to the Class HE:B-2 Certificateholders in an amount
equal to the product of (a) the Class HE:B-2 Pass-Through
Rate and (b) the then outstanding Class HE:B-2 Principal
Balance less the Class HE:B-2 Liquidation Loss Principal
Amount. The Limited Guaranty will be available to pay
interest to the Class HE:B-2 Certificateholders if the
Sub-Pool HE Amount Available is not sufficient. Interest
will accrue from the Settlement Date, or from the most
recent Payment Date on which interest has been paid, to
but excluding the following Payment Date. Interest will
be computed on 30/360 basis.
Interest shortfall will be carried forward, and will bear
interest at the Class HE:B-2 Pass-Through Rate, to the
extent legally permissible.
[MERRILL LYNCH LOGO] 7
- --------------------------------------------------------------------------------
Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
CLASS HE:B-2 PRINCIPAL The Class HE:B-2 Certificateholders will not receive
principal payments until the Class HE:B-1 Principal
Balance has been reduced to zero. At that time, if each
Class HE:B Principal Distribution Test is satisfied
(unless the Class HE:A and Class HE:M Principal Balances
have been reduced to zero), to the extent of the amount
available after payment of the Class HE:A, the Class
HE:M and the Class HE:B-1 Distribution Amounts and any
amounts actually paid under the Class HE:B-2 Limited
Guaranty, the Class HE:B-2 Certificateholders will
receive the Class HE:B Percentage of the Sub-Pool HE
Formula Principal Distribution Amount until Class HE:B-2
Principal Balance has been reduced to zero.
On each Payment Date, the Class HE:B-2
Certificateholders will be entitled to receive pursuant
to the Class HE:B-2 Limited Guaranty, the Class HE:B-2
Liquidation Loss Principal Amount until the Class HE:B-2
Principal Balance has been reduced to zero.
LOSSES ON LIQUIDATED
HE CONTRACTS: If Net Liquidation Proceeds from Liquidated Contracts
in the respective collection period are less than the
Scheduled Principal Balance of such Liquidated Contract
plus accrued and unpaid interest thereon, the deficiency
will be absorbed by the Class C Certificateholder, then
the Guaranty Fee otherwise payable to the Company, then
the Monthly Servicing Fee otherwise payable to the
Servicer (as long as Green Tree is the Servicer), then
the Class HE:B-2 Certificateholders, then the Class HE:
B-1 Certificateholders, then the Class HE:M-1
Certificateholders and then the Class HE:M-2
Certificateholders.
CLASS HE:B-2 LIMITED
GUARANTY To the extent that the amount available is not
sufficient, the Limited Guaranty will be available to
pay Class HE:B-2 Liquidation Loss Principal Amount and
Class HE:B-2 Distribution Amount. The Class HE:B-2
Limited Guaranty will be an unsecured general obligation
of the Company.
CLASS HE:B PRINCIPAL
DISTRIBUTION TESTS: (i) the Sub-Pool HE Average Sixty-Day Delinquency
Ratio with respect to Sub-Pool HE as of given
Payment Date must not exceed 2.5%;
(ii) the Sub-Pool HE Average Thirty-Day Delinquency
Ratio with respect to Sub-Pool HE as of given
Payment Date must not exceed 5%;
(iii) the Sub-Pool HE Cumulative Realized Losses with
respect to Sub-Pool HE as of given Payment Date
must not exceed a certain specified percentage of
the Cut-off Date Pool Principal Balance of Sub-
Pool HE, depending on the year in which such
Payment Date occurs;
(iv) the Sub-Pool HE Current Realized Loss Ratio with
respect to Sub-Pool HE as of given Payment Date
must not exceed 2.0%; and
(v) the Class HE:B Principal Balance divided by the
Pool Scheduled Principal Balance of Sub-Pool HE as
of the immediately preceding Payment Date must be
equal or greater than 9.50%.
[MERRILL LYNCH LOGO] 8
- --------------------------------------------------------------------------------
Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
HOME IMPROVEMENT CONTRACTS
The Home Improvement Contracts comprising Sub-Pool HI consist of
conventional and FHA-insured home improvement contracts and promissory notes.
The obligations of the Obligor under each Home Improvement Contract are secured
by the related real estate.
The information concerning the Initial Home Improvement Contracts presented
below is based on a pool originated through September 1, 1996. Green Tree
intends to acquire and sell additional Home Improvement Contracts, which are
sufficient to support the balance of Home Improvement Certificates sold, to the
Trust by the Closing Date. Although the characteristics of the final pool of
Home Improvement Contracts will differ from the characteristics of the Initial
Home Improvement Contracts shown below, Green Tree does not expect that the
characteristics of the additional Home Improvement Contracts sold to the Trust
will vary materially from the information concerning the Initial Home
Improvement Contracts herein.
THE INITIAL HOME IMPROVEMENT CONTRACT SUB-POOL
Number of Contracts in Sub-Pool: 9,455
Wgt. Avg. Contract Rate: 11.52%
Range of Rates: 5.90% - 16.99%
Wgt. Avg. Orig. Maturity: 203 mos.
Wgt. Avg. Rem. Maturity: 202 mos.
Avg. Rem Princ. Balance: $16,876
GEOGRAPHIC DISTRIBUTION OF MORTGAGED PROPERTIES
INITIAL HOME IMPROVEMENT CONTRACTS
<TABLE>
<CAPTION>
% of HI Contract % of HI Contract Sub-Pool
Number Sub-Pool by Number Aggregate Principal by Outstanding
State of Contracts of Contracts Balance Outstanding Principal Balance
- ----- ------------ ------------------ ------------------- -------------------------
<S> <C> <C> <C> <C>
CA 1,224 12.94% $ 31,191,723.68 19.54%
NJ 709 7.49% 11,930,554.39 7.47%
NY 678 7.17% 11,768,136.79 7.37%
FL 601 6.36% 10,125,431.09 6.34%
MI 516 5.46% 8,053,588.37 5.05%
Other States* 5,727 60.58% 86,493,503.21 54.23%
----- ------- --------------- -------
Total 9,455 100.00% $159,562,937.53 100.00%
===== ======= =============== =======
</TABLE>
- ------------------
* No one State in this category constitutes more than 5% of the Sub-Pool HI
Outstanding Principal Balance.
YEARS OF ORIGINATION OF INITIAL HOME IMPROVEMENT CONTRACTS
<TABLE>
<CAPTION>
% of HI Contract Sub-Pool
Number of Aggregate Principal by Outstanding
Year of Origination Contracts Balance Outstanding Principal Balance
- ------------------- --------- ------------------- -------------------------
<S> <C> <C> <C>
1990 1 $ 11,934.29 0.01%
1991 0 0.00 0.00%
1992 0 0.00 0.00%
1993 2 50,732.39 0.03%
1994 1 9,367.86 0.01%
1995 31 510,644.71 0.32%
1996 9,420 158,980,258.28 99.63%
----- --------------- -------
Total 9,455 $159,562,937.53 100.00%
===== =============== =======
</TABLE>
[MERRILL LYNCH LOGO] 9
- --------------------------------------------------------------------------------
Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
DISTRIBUTION OF ORIGINAL INITIAL HOME IMPROVEMENT CONTRACT AMOUNTS
<TABLE>
<CAPTION>
% of HI Contract Sub-Pool
Original HI Contract Number of Aggregate Principal by Outstanding
Amount (in Dollars) Contracts Balance Outstanding Principal Balance
- -------------------- --------- ------------------- -------------------------
<S> <C> <C> <C>
Less than $10,000 2,387 $ 16,946,420.94 10.62%
Between $10,000 - $19,999 4,232 61,331,294.71 38.44%
Between $20,000 - $29,999 1,891 44,962,877.87 28.18%
Between $30,000 - $39,999 602 20,158,600.74 12.63%
Between $40,000 - $49,999 276 11,575,429.05 7.25%
Between $50,000 - $59,999 30 1,591,589.87 1.00%
Between $60,000 - $69,999 16 1,024,796.52 0.64%
Between $70,000 - $79,999 12 902,391.23 0.57%
Between $80,000 - $89,999 2 169,014.23 0.11%
Between $90,000 - $99,999 0 0.00 0.00%
Between $100,000 - $109,999 2 189,900.81 0.12%
Between $110,000 - $119,999 1 116,200.90 0.07%
Between $120,000 - $129,999 2 248,760.03 0.16%
Between $130,000 - $139,999 0 0.00 0.00%
Between $140,000 - $149,999 1 147,223.23 0.09%
Between $150,000 - $159,999 0 0.00 0.00%
Between $160,000 - $169,999 0 0.00 0.00%
Between $170,000 - $179,999 0 0.00 0.00%
Between $180,000 - $189,999 0 0.00 0.00%
Between $190,000 - $199,999 1 198,437.37 0.12%
----- --------------- -------
Total 9,455 $159,562,937.53 100.00%
===== =============== =======
</TABLE>
INITIAL HOME IMPROVEMENT CONTRACT RATES
<TABLE>
<CAPTION>
% of HI Contract Sub-Pool
Range of HI Contracts by Number of Aggregate Principal by Outstanding
Contract Rate Contracts Balance Outstanding Principal Balance
- ------------- --------- ------------------- -------------------------
<S> <C> <C> <C>
From 0.00% - 9.00% 172 $ 4,258,249.20 2.67%
From 9.01% - 10.00% 1,089 23,984,570.15 15.03%
From 10.01% - 11.00% 2,882 57,491,083.95 36.03%
From 11.01% - 12.00% 1,682 29,347,296.61 18.39%
From 12.01% - 13.00% 1,720 23,020,535.34 14.43%
From 13.01% - 14.00% 1,532 18,166,680.99 11.39%
From 14.01% - 15.00% 293 2,643,060.64 1.66%
From 15.01% - 16.00% 78 612,091.18 0.38%
From 16.01% - 17.00% 7 39,369.47 0.02%
Over 17.01% 0 0.00 0.00%
----- --------------- -------
Total 9,455 $159,562,937.53 100.00%
===== =============== =======
</TABLE>
[MERRILL LYNCH LOGO] 10
- --------------------------------------------------------------------------------
Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
REMAINING MONTHS TO MATURITY OF INITIAL HOME IMPROVEMENT CONTRACTS
<TABLE>
<CAPTION>
% of HI Contract Sub-Pool
Number of Aggregate Principal by Outstanding
Months Remaining Contracts Balance Outstanding Principal Balance
- ---------------- --------- ------------------- -------------------------
<S> <C> <C> <C>
Less than 31 28 $ 151,035.59 0.09%
31-60 769 6,407,450.45 4.02%
61-90 417 3,971,358.55 2.49%
91-120 2,718 34,288,815.88 21.49%
121-150 100 1,263,970.17 0.79%
151-180 2,428 43,288,395.35 27.13%
181-210 6 71,669.64 0.04%
211-240 1,111 22,852,028.35 14.32%
241-270 2 36,162.41 0.02%
271-300 1,875 47,200,835.47 29.59%
301-330 0 0.00 0.00%
331-360 1 31,215.67 0.02%
----- --------------- -------
Total 9,455 $159,562,937.53 100.00%
===== =============== =======
</TABLE>
LIEN POSITION OF INITIAL HOME IMPROVEMENT CONTRACTS
<TABLE>
<CAPTION>
% of HI Contract % of HI Contract Sub-Pool
Number Sub-Pool by Number Aggregate Principal by Outstanding
of Contracts of Contracts Balance Outstanding Principal Balance
------------ ------------------ ------------------- -------------------------
<S> <C> <C> <C> <C>
First 509 5.38% $ 7,621,338.09 4.78%
Second 7,306 77.27% 124,826,299.88 78.23%
Third 1,627 17.21% 26,869,263.93 16.84%
Fourth* 13 0.14% 246,035.63 0.15%
----- ------- --------------- -------
Total 9,455 100.00% $159,562,937.53 100.00%
===== ======= =============== =======
</TABLE>
- ---------------------
* Includes two Contracts, lien positions with respect to which have not been
verified.
[MERRILL LYNCH LOGO] 11
- --------------------------------------------------------------------------------
Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
HOME EQUITY CONTRACTS
The Home Equity Contracts comprising Sub-Pool HE consist of closed-end home
equity loans. The obligations of the Obligor under each Home Equity Contract are
secured by the related real estate.
THE HOME EQUITY CONTRACT SUB-POOL
Number of Contracts in pool: 4,029
Wgt. Avg. Contract Rate: 12.39%
Range of Rates: 1.24% - 19.00%
Wgt. Avg. Orig. Maturity: 202 mos.
Wgt. Avg. Rem. Maturity: 201 mos.
Avg. Rem Princ. Balance: $46,704
Wgt. Avg. CLTV 85.2%
GEOGRAPHIC DISTRIBUTION OF MORTGAGE PROPERTIES
HOME EQUITY CONTRACTS
<TABLE>
<CAPTION>
% of HE Contract % of HE Contract Sub-Pool
Number Sub-Pool by Number Aggregate Principal by Outstanding
State of Contracts of Contracts Balance Outstanding Principal Balance
- ----- ------------ ------------------ -------------------- -------------------------
<S> <C> <C> <C> <C>
GA 529 13.14% $ 25,434,468.20 13.52%
OH 395 9.80% 21,358,613.55 11.35%
NC 447 11.09% 20,485,107.10 10.89%
FL 501 12.44% 18,796,896.49 9.99%
SC 358 8.89% 15,929,889.78 8.47%
PA 292 7.25% 12,457,060.37 6.62%
MD 212 5.26% 12,418,084.60 6.60%
Other States* 1,295 32.13% 61,290,535.04 32.56%
----- ------- --------------- -------
Total 4,029 100.00% $188,170,655.13 100.00%
===== ======= =============== =======
</TABLE>
- -------------------
* No one State in this category constitutes more than 5% of the Sub-Pool HE
Outstanding Principal Balance.
YEARS OF ORIGINATION OF HOME EQUITY CONTRACTS
<TABLE>
<CAPTION>
% of HE Contract Sub-Pool
Number of Aggregate Principal by Outstanding
Year of Origination Contracts Balance Outstanding Principal Balance
- ------------------- --------- ------------------- -------------------------
<S> <C> <C> <C>
1990 1 $ 89,970.92 0.05%
1991 0 0.00 0.00%
1992 0 0.00 0.00%
1993 2 173,278.18 0.09%
1994 1 69,697.13 0.04%
1995 21 1,097,113.38 0.58%
1996** 4,004 186,740,595.52 99.24%
----- --------------- -------
Total 4,029 $188,170,655.13 100.00%
===== =============== =======
</TABLE>
- ---------------------
** Includes one Contract, year of origination with respect to which has not
been verified.
[MERRILL LYNCH LOGO] 12
- --------------------------------------------------------------------------------
Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
DISTRIBUTION OF ORIGINAL HOME EQUITY CONTRACT AMOUNTS
<TABLE>
<CAPTION>
% of HE Contract Sub-Pool
Original HE Contract Number of Aggregate Principal by Outstanding
Amount (in Dollars) Contracts Balance Outstanding Principal Balance
- ------------------- --------- ------------------- -----------------
<S> <C> <C> <C>
Less than $10,000 56 $ 400,523.12 0.21%
Between $10,000 - $19,999 728 10,735,505.75 5.71%
Between $20,000 - $29,999 737 17,898,018.98 9.51%
Between $30,000 - $39,999 615 21,201,088.79 11.27%
Between $40,000 - $49,999 511 22,676,674.44 12.04%
Between $50,000 - $59,999 375 20,365,405.37 10.82%
Between $60,000 - $69,999 267 17,215,579.52 9.15%
Between $70,000 - $79,999 217 16,143,848.10 8.58%
Between $80,000 - $89,999 123 10,341,930.14 5.50%
Between $90,000 - $99,999 108 10,221,493.48 5.43%
Between $100,000 - $109,999 61 6,372,891.60 3.39%
Between $110,000 - $119,999 46 5,267,339.57 2.80%
Between $120,000 - $129,999 50 6,224,535.82 3.31%
Between $130,000 - $139,999 28 3,757,024.72 2.00%
Between $140,000 - $149,999 26 3,765,033.54 2.00%
Between $150,000 - $159,999 18 2,772,198.58 1.47%
Between $160,000 - $169,999 15 2,458,504.58 1.31%
Between $170,000 - $179,999 6 1,045,159.33 0.56%
Between $180,000 - $189,999 10 1,829,535.49 0.97%
Between $190,000 - $199,999 8 1,562,557.23 0.83%
Between $200,000 - $249,999 17 3,781,917.09 2.01%
Between $250,000 - $299,999 3 855,400.23 0.45%
Between $300,000 - $349,999 3 914,489.66 0.49%
Over $350,000 1 364,000.00 0.19%
----- --------------- ------
Total 4,029 $188,170,655.13 100.00%
===== =============== ======
</TABLE>
HOME EQUITY CONTRACT RATES
<TABLE>
<CAPTION>
% of HE Contract Sub-Pool
Range of HE Contracts Number of Aggregate Principal by Outstanding
by Contract Rate Contracts Balance Outstanding Principal Balance
- ------------------- --------- ------------------- -----------------
<S> <C> <C> <C>
From 0.00% - 9.00% 12 $ 736,795.84 0.39%
From 9.01% - 10.00% 111 8,252,593.36 4.39%
From 10.01% - 11.00% 389 25,153,983.57 13.37%
From 11.01% - 12.00% 809 45,098,919.28 23.97%
From 12.01% - 13.00% 1,201 60,733,567.09 32.27%
From 13.01% - 14.00% 679 27,006,105.52 14.35%
From 14.01% - 15.00% 415 11,905,412.60 6.33%
From 15.01% - 16.00% 282 6,642,079.16 3.53%
From 16.01% - 17.00% 89 1,865,300.48 0.99%
Over 17.01% 42 775,898.23 0.41%
----- --------------- ------
Total 4,029 $188,170,655.13 100.00%
===== =============== ======
</TABLE>
[MERRILL LYNCH LOGO] 13
- --------------------------------------------------------------------------------
Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
REMAINING MONTHS TO MATURITY OF HOME EQUITY CONTRACTS
<TABLE>
<CAPTION>
% of HE Contract Sub-Pool
Number of Aggregate Principal by Outstanding
Months Remaining Contracts Balance Outstanding Principal Balance
- ---------------- ---------- ------------------- -------------------
<S> <C> <C> <C>
31-45 1 $ 3,324.52 0.00%
46-60 58 877,114.51 0.47%
61-75 6 68,228.61 0.04%
76-90 22 370,450.00 0.20%
91-105 5 125,139.41 0.07%
106-120 302 6,426,680.69 3.42%
121-135 2 37,427.20 0.02%
136-150 10 392,499.50 0.21%
151-165 5 102,503.68 0.05%
166-180 2,477 124,427,264.49 66.11%
181-195 0 0.00 0.00%
196-210 0 0.00 0.00%
211-225 2 103,879.17 0.06%
226-240 983 43,800,729.43 23.28%
241-255 0 0.00 0.00%
256-270 0 0.00 0.00%
271-285 1 47,000.00 0.02%
286-300 3 225,102.99 0.12%
301-315 0 0.00 0.00%
316-330 0 0.00 0.00%
331-345 1 69,697.13 0.04%
346-360 151 11,093,613.80 5.90%
----- --------------- ------
Total 4,029 $188,170,655.13 100.00%
===== =============== ======
</TABLE>
LIEN POSITION OF HOME EQUITY CONTRACTS
<TABLE>
<CAPTION>
% of HE Contract % of HE Contract Sub-Pool
Number Sub-Pool by Number Aggregate Principal by Outstanding
of Contracts of Contracts Balance Outstanding Principal Balance
---------------- ------------------- ------------------- ------------------
<S> <C> <C> <C> <C>
First 2,322 57.63% $143,982,035.61 76.51%
Second 1,659 41.18% 43,402,137.36 23.07%
Third or Lower 48 1.19% 786,482.16 0.42%
----- ------ --------------- ------
Total 4,029 100.00% $188,170,655.13 100.00%
===== ====== =============== ======
</TABLE>
[MERRILL LYNCH LOGO] 14
- --------------------------------------------------------------------------------
Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
ORIGINAL LOAN-TO-VALUE RATIO OF HOME EQUITY CONTRACTS
<TABLE>
<CAPTION>
% of HE Contract Sub-Pool
Number of Aggregate Principal by Outstanding
Loan-to-Value Ratio Contracts Balance Outstanding Principal Balance
- ---------------------- --------- ------------------- -----------------
<S> <C> <C> <C>
From 0.00% - 10.00% 125 $ 1,634,894.93 0.87%
From 10.01% - 20.00% 703 13,464,204.24 7.16%
From 20.01% - 30.00% 586 16,481,165.93 8.76%
From 30.01% - 40.00% 243 8,605,226.10 4.57%
From 40.01% - 50.00% 99 3,818,102.43 2.03%
From 50.01% - 60.00% 82 3,426,541.89 1.82%
From 60.01% - 70.00% 245 11,385,364.96 6.05%
From 70.01% - 80.00% 667 35,259,831.51 18.74%
From 80.01% - 90.00% 1,008 72,397,058.80 38.47%
Over 90.01% 271 21,698,264.34 11.53%
----- --------------- ------
Total 4,029 $188,170,655.13 100.00%
===== =============== ======
</TABLE>
COMBINED LOAN-TO-VALUE RATIO OF HOME EQUITY CONTRACTS
<TABLE>
<CAPTION>
% of HE Contract Sub-Pool
Number of Aggregate Principal by Outstanding
Loan-to-Value Ratio(1) Contracts Balance Outstanding Principal Balance
- ---------------------- --------- ------------------- -----------------
<S> <C> <C> <C>
Less than 61% 232 $ 6,811,320.51 3.62%
61% - 65% 90 4,040,615.03 2.15%
66% - 70% 178 7,751,648.47 4.12%
71% - 75% 293 13,192,306.59 7.01%
76% - 80% 484 24,873,777.88 13.22%
81% - 85% 506 28,453,190.30 15.12%
86% - 90% 1,033 59,182,058.88 31.45%
91% - 95% 715 32,323,814.60 17.18%
Over 95% 498 11,541,922.87 6.13%
----- --------------- ------
Total 4,029 $188,170,655.13 100.00%
===== =============== ======
</TABLE>
[MERRILL LYNCH LOGO] 15
- --------------------------------------------------------------------------------
Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
CPR PREPAYMENT SENSITIVITIES
FOR HOME IMPROVEMENT CONTRACT CERTIFICATES
<TABLE>
<CAPTION>
11% CPR 13% CPR 15% CPR 17% CPR 19% CPR
WAL/Maturity WAL/Maturity WAL/Maturity WAL/Maturity WAL/Maturity
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
To Call
A-1 1.40 / 09/99 1.22 / 05/99 1.08 / 01/99 0.97 / 10/98 0.87 / 08/98
A-2 3.94 / 10/01 3.47 / 03/01 3.09 / 10/00 2.77 / 05/00 2.50 / 12/99
A-3 7.24 / 01/07 6.52 / 11/05 5.91 / 02/05 5.37 / 06/04 4.88 / 10/03
M-1 12.10 / 12/10 10.77 / 06/08 9.41 / 07/06 8.33 / 03/05 7.49 / 04/04
M-2 14.21 / 12/10 11.71 / 06/08 9.79 / 07/06 8.46 / 03/05 7.54 / 04/04
B-1 6.40 / 05/05 5.69 / 08/04 5.14 / 12/03 4.67 / 04/03 4.38 / 11/02
B-2 11.95 / 12/10 10.37 / 06/08 9.05 / 07/06 8.03 / 03/05 7.29 / 04/04
To Maturity
M-1 12.10 / 01/11 11.00 / 12/09 9.98 / 12/08 9.13 / 12/07 8.38 / 01/07
M-2 17.57 / 08/21 16.37 / 08/21 15.26 / 08/21 14.21 / 08/21 13.22 / 08/21
B-2 12.87 / 08/21 11.74 / 08/21 10.80 / 08/21 9.97 / 08/21 9.33 / 08/21
</TABLE>
CPR PREPAYMENT SENSITIVITIES
FOR HOME EQUITY CONTRACT CERTIFICATES
<TABLE>
<CAPTION>
50% of Base* 75% of Base* 100% of Base* 125% of Base* 150% of Base*
WAL/Maturity WAL/Maturity WAL/Maturity WAL/Maturity WAL/Maturity
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
To Call
A-1 1.82 / 05/00 1.33 / 04/99 1.06 / 09/98 0.89 / 05/98 0.78 / 02/98
A-2 5.61 / 10/04 3.98 / 07/02 3.06 / 03/01 2.47 / 04/00 2.07 / 08/99
A-3 9.15 / 02/07 6.60 / 04/04 5.08 / 07/02 4.05 / 05/01 3.30 / 07/00
A-4 12.72 / 12/10 9.60 / 06/08 7.48 / 07/06 6.00 / 08/04 4.91 / 04/03
M-1 14.21 / 12/10 11.71 / 06/08 9.79 / 07/06 8.38 / 03/05 7.23 / 04/04
M-2 14.21 / 12/10 11.71 / 06/08 9.79 / 07/06 8.46 / 03/05 7.54 / 04/04
B-1 9.55 / 12/10 6.99 / 10/07 5.38 / 04/05 4.70 / 01/04 4.39 / 04/03
B-2 14.21 / 12/10 11.66 / 06/08 9.62 / 07/06 8.26 / 03/05 7.36 / 04/04
To Maturity
A-4 12.85 / 07/11 9.64 / 04/09 7.48 / 07/06 6.00 / 08/04 4.91 / 04/03
M-1 14.79 / 07/11 13.94 / 07/11 11.23 / 10/09 9.07 / 05/07 7.48 / 07/05
M-2 18.04 / 06/26 16.00 / 06/26 14.84 / 06/26 12.98 / 06/26 11.08 / 06/26
B-2 15.74 / 06/26 13.95 / 06/26 11.72 / 06/26 10.11 / 06/26 8.98 / 06/26
</TABLE>
- --------------------
* 100% Base (100% Prepayment Assumption) assumes a conditional prepayment rate
of 4% per annum of the then outstanding principal balance of the Home Equity
Contracts in the first month of the life of the Home Equity Contracts and an
additional 1.45% (precisely, 16/11%) per annum in each month thereafter until
the twelfth month. Beginning in twelfth month and in each month thereafter,
the conditional prepayment rate is 20%.
[MERRILL LYNCH LOGO] 16
- --------------------------------------------------------------------------------
Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
The attached tables and other statistical analyses (the "Term Sheet") are
privileged and confidential and are intended for use by the addressee only.
This Term Sheet is furnished to you solely by Merrill Lynch, Pierce, Fenner &
Smith Incorporated ("Merrill Lynch") and not by the issuer of the securities or
any of its affiliates. The issuer of these securities has not prepared or taken
part in the preparation of these materials. Neither Merrill Lynch, the issuer
of the securities nor any of its affiliates makes any representation as to the
accuracy or completeness of the information herein. The information herein is
preliminary, and will be subsequently filed with the Securities and Exchange
Commission. They may not be provided to any third party other than the
addressee's legal, tax, financial and/or accounting advisors for the purposes of
evaluating said material.
Numerous assumptions were used in preparing the Term Sheet which may or may
not be stated therein. As such, no assurance can be given as to the accuracy,
appropriateness or completeness of the Term Sheet in any particular context; or
as to whether the Term Sheet and/or the assumptions upon which it is based
reflect present market conditions or future market performance. This Term Sheet
should not be construed as either projections or predictions or as legal, tax,
financial or accounting advice.
Any yields or weighted average lives shown in the Term Sheet are based on
prepayment assumptions and actual prepayment experience may dramatically affect
such yields or weighted average lives. In addition, it is possible that
prepayments on the underlying assets will occur at rates slower or faster than
the rates assumed in the attached Term Sheet. Furthermore, unless otherwise
provided, the Term Sheet assumes no losses on the underlying assets and no
interest shortfall. The specific characteristics of the securities may differ
from those shown in the Term Sheet due to differences between the actual
underlying assets and the hypothetical assets used in preparing the Term Sheet.
The principal amount and designation of any security described in the Term Sheet
are subject to change prior to issuance.
Although a registration statement (including the prospectus) relating to
the securities discussed in this communication has been filed with the
Securities and Exchange Commission and is effective, the final prospectus
supplement relating to the securities discussed in this communication has not
been filed with the Securities and Exchange Commission. This communication
shall not constitute an offer to sell or the solicitation of an offer to buy nor
shall there be any sale of the securities discussed in this communication in any
state in which such offer, solicitations or sale would be unlawful prior to
registration or qualification under the securities laws of any such state.
Prospective purchasers are referred to the final prospectus and prospectus
supplement relating to the securities discussed in this communication for
definitive Term Sheet on any matter discussed in this communication. A final
prospectus and prospectus supplement may be obtained by contacting the Merrill
Lynch Trading Desk and (212) 449-3659.
Please be advised that asset-backed securities may not be appropriate for
all investors. Potential investors must be willing to assume, among other
things, market price volatility, prepayments, yield curve and interest rate
risk. Investors should fully consider the risk of an investment in these
securities.
If you have received this communication in error, please notify the sending
party immediately by telephone and return the original to such party by mail.
[MERRILL LYNCH LOGO] 17
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<PAGE>
Exhibit 99.2
TERM SHEET DATED SEPTEMBER 16, 1996
GREEN TREE FINANCIAL CORPORATION
CERTIFICATES FOR HOME IMPROVEMENT LOANS
SERIES 1996-E
$27,088,323 (APPROXIMATE)
Subject to Revision
SELLER/SERVICER: Green Tree Financial Corporation ("Green Tree").
TRUSTEE: First Trust National Association
UNDERWRITERS: Merrill Lynch (Lead), Lehman Brothers (Co).
RATINGS (S&P/Fitch): A-/A
CERTIFICATE AMOUNT: 27,088,323
WAL (at 20% CPR): 2.23 yrs. (to Call) / 2.40 yrs. (to Maturity)
EXP. MATURITY: January 2002 (to Call) / February 2011 (to Maturity)
CUT-OFF DATE: September 1, 1996 (or the date of origination, if
later)
EXP. PRICING: September 18, 1996
EXP. SETTLEMENT: September 30, 1996
LEGAL FINAL: September 2017
INTEREST/PRINCIPAL: The 15th day of each month (or if such 15th day is not
a business day, the next succeeding business day),
commencing on October 15, 1996.
ERISA: Not Eligible.
SMMEA: Not Eligible.
TAX STATUS: In an opinion of counsel to the Company, the Trust
will be classified as a grantor trust for federal
income tax purposes.
OPTIONAL REDEMPTION: Less than 10% of the original pool balance
outstanding.
CONTRACTS: The Contracts consist of conventional and FHA-insured
home improvement contracts and promissory notes. The
obligations of the Obligor under each Contract are
unsecured.
[MERRILL LYNCH LOGO] 1
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Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
STRUCTURE:
DISTRIBUTIONS: The Amount Available on each Payment Date generally includes
payments on the Contracts due during the previous calendar
month and received on or prior to the Determination Date,
prepayments and other unscheduled collections received on the
Contracts during such Due Period, any Advances made by the
Servicer or the Trustee with respect to such Due Period and
any amounts paid by the Company to repurchase a Contract due
to a breach of representation or warranty.
INTEREST: Interest on the Certificates will be payable on each Payment
Date in an amount equal to one month's interest at the Pass-
Through Rate on the Aggregate Certificate Principal Balance
immediately prior to such Payment Date; provided that, in the
case of the first Payment Date, such interest will be payable
only for the period from the Closing Date to but excluding
October 15, 1996. Interest will be computed on 30/360 basis.
Interest shortfall will be carried forward, and will bear
interest at the Pass-Through Rate, to the extent legally
permissible.
PRINCIPAL: On each Payment Date, the Certificateholders will be entitled
to receive as distributions of principal, to the extent of
the Amount Available after payment of all interest payable on
the Certificates, an amount equal to the sum ("Monthly
Principal") of (a) the amount of regular principal payments
on Contracts paid or applied during the prior Due Period; (b)
the amount of Principal Prepayments received on Contracts
during the prior Due Period; (c) the principal portion of all
payments on Contracts that were Delinquent Payments as of the
end of the prior Due Period; (d) the unpaid principal balance
of all Contracts that became Liquidated Contracts with
respect to the prior Due Period; (e) the principal portion of
the Repurchase Price paid by the Company to repurchase
Contracts for breach of representation and warranties with
respect to the prior Due Period; (f) the amount of any
reduction in the principal amount deemed owed on any Contract
as a result of the Obligor's bankruptcy; and (g) any
principal amount described in clauses (a) through (f) above
that was not previously distributed because of an
insufficient amount of funds available in the Certificate
Account and the Company either was not obligated to or failed
to pay such amount under the Limited Guaranty.
LIMITED GUARANTY: The Guaranty Amount initially equals approximately
$[2,708,832]. Thereafter, on any Payment Date, the Guaranty
Amount will equal the lesser of (i) $[2,708,832] minus all
Guaranty Payments previously made by the Company, or (ii) the
Aggregate Certificate Principal Balance on such Payment Date
plus three months of interest at the Pass-Through Rate on the
Aggregate Certificate Principal Balance as of such Payment
Date. The Limited Guaranty will be an unsecured general
obligation of the Company.
[MERRILL LYNCH LOGO] 2
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Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
THE UNSECURED HOME IMPROVEMENT CONTRACT POOL
Number of Contracts in pool: 5,183
Wgt. Avg. Contract Rate: 14.41%
Range of Rates: 10.00% - 17.99%
Wgt. Avg. Orig. Maturity: 87 mos.
Wgt. Avg. Rem. Maturity: 85 mos.
Avg. Rem Princ. Balance: $5,226
GEOGRAPHIC DISTRIBUTION OF IMPROVED REAL ESTATE
<TABLE>
<CAPTION>
% of Contract % of Contract Pool
Number Pool by Number Aggregate Principal by Outstanding
State of Contracts of Contracts Balance Outstanding Principal Balance
- ----- ------------ --------------- -------------------- ------------------
<S> <C> <C> <C> <C>
CA 848 16.37% $ 4,276,609.30 15.78%
TX 445 8.60% 2,326,112.80 8.58%
MA 235 4.53% 1,702,247.95 6.27%
Other States* 3,655 70.50% 18,783,353.37 69.37%
----- ----- -------------- ------
Total 5,183 100.00% $27,088,323.42 100.00%
===== ====== ============== ======
- ----------------------
</TABLE>
* No one State in this category constitutes more than 5% of the Sub-Pool HI
Outstanding Principal Balance.
YEARS OF ORIGINATION OF CONTRACTS
<TABLE>
<CAPTION>
% of Contract Pool
Number of Aggregate Principal by Outstanding
Year of Origination Contracts Balance Outstanding Principal Balance
- ------------------- --------- -------------------- ------------------
<S> <C> <C> <C>
1993 1 $8,767.69 0.03%
1995 76 400,729.11 1.48%
1996 5,106 26,678,826.62 98.49%
----- -------------- ------
Total 5,183 $27,088,323.42 100.00%
===== ============== ======
</TABLE>
DISTRIBUTION OF ORIGINAL CONTRACT AMOUNTS
<TABLE>
<CAPTION>
% of Contract Pool
Original Contract Number of Aggregate Principal by Outstanding
Amount (in Dollars) Contracts Balance Outstanding Principal Balance
- ------------------- --------- -------------------- ------------------
<S> <C> <C> <C>
Less than $10,000 4,893 $23,613,512.05 87.17%
$10,000 - $19,999 290 3,474,811.37 12.83%
----- -------------- -----
Total 5,183 $27,088,323.42 100.00%
===== ============== ======
</TABLE>
[MERRILL LYNCH LOGO] 3
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Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
CONTRACT RATES
<TABLE>
<CAPTION>
% of Contract Pool
Range of Contracts by Number of Aggregate Principal by Outstanding
Contract Rate Contracts Balance Outstanding Principal Balance
- ------------- --------- ------------------- ------------------
<S> <C> <C> <C>
9.00001%-10.00000% 29 $95,358.61 0.35%
10.00001%-11.00000% 1 9,847.99 0.04%
11.00001%-12.00000% 1 8,187.04 0.03%
12.00001%-13.00000% 1,584 7,739,908.18 28.57%
13.00001%-14.00000% 1,152 5,877,830.89 21.70%
14.00001%-15.00000% 1,247 7,139,270.85 26.36%
15.00001%-16.00000% 968 5,365,850.64 19.81%
16.00001%-17.00000% 112 531,881.52 1.96%
Over 17.00000% 89 320,187.70 1.18%
----- -------------- ------
Total 5,183 $27,088,323.42 100.00%
===== ============== ======
</TABLE>
REMAINING MONTHS TO MATURITY
<TABLE>
<CAPTION>
% of Contract Pool
Number of Aggregate Principal by Outstanding
Months Remaining Contracts Balance Outstanding Principal Balance
- ---------------- --------- ------------------- ------------------
<S> <C> <C> <C>
Less than 31 283 $875,439.55 3.23%
31 - 60 2,512 10,636,983.96 39.27%
61 - 90 482 2,374,932.07 8.77%
91 - 120 1,893 13,078,340.97 48.28%
121 - 150 4 29,891.71 0.11%
151 - 180 8 82,322.16 0.30%
181 - 210 0 0.00 0.00%
211 - 240 1 10,413.00 0.04%
----- -------------- ------
Total 5,183 $27,088,323.42 100.00%
===== ============== ======
</TABLE>
CPR PREPAYMENT SENSITIVITIES
FOR UNSECURED HOME IMPROVEMENT CERTIFICATES
<TABLE>
<CAPTION>
10% CPR 15% CPR 20% CPR 25% CPR 30% CPR
WAL/Maturity WAL/Maturity WAL/Maturity WAL/Maturity WAL/Maturity
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
To Call
3.02 / 10/03 2.59 / 11/02 2.23 / 01/02 1.95 / 05/01 1.73 / 12/00
To Maturity
3.14 / 02/11 2.74 / 02/11 2.40 / 02/11 2.12 / 02/11 1.87 / 02/11
</TABLE>
[MERRILL LYNCH LOGO] 4
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Recipients must read the information contained in the attached statement. Do not
use or rely on this information if you have not received and reviewed the
statement. If you have not received the statement, call your Merrill Lynch
account executive for another copy.
<PAGE>
The attached tables and other statistical analyses (the "Term Sheet") are
privileged and confidential and are intended for use by the addressee only. This
Term Sheet is furnished to you solely by Merrill Lynch, Pierce, Fenner & Smith
Incorporated ("Merrill Lynch") and not by the issuer of the securities or any of
its affiliates. The issuer of these securities has not prepared or taken part in
the preparation of these materials. Neither Merrill Lynch, the issuer of the
securities nor any of its affiliates makes any representation as to the accuracy
or completeness of the information herein. The information herein is
preliminary, and will be subsequently filed with the Securities and Exchange
Commission. They may not be provided to any third party other than the
addressee's legal, tax, financial and/or accounting advisors for the purposes of
evaluating said material.
Numerous assumptions were used in preparing the Term Sheet which may or may
not be stated therein. As such, no assurance can be given as to the accuracy,
appropriateness or completeness of the Term Sheet in any particular context; or
as to whether the Term Sheet and/or the assumptions upon which it is based
reflect present market conditions or future market performance. This Term Sheet
should not be construed as either projections or predictions or as legal, tax,
financial or accounting advice.
Any yields or weighted average lives shown in the Term Sheet are based on
prepayment assumptions and actual prepayment experience may dramatically affect
such yields or weighted average lives. In addition, it is possible that
prepayments on the underlying assets will occur at rates slower or faster than
the rates assumed in the attached Term Sheet. Furthermore, unless otherwise
provided, the Term Sheet assumes no losses on the underlying assets and no
interest shortfall. The specific characteristics of the securities may differ
from those shown in the Term Sheet due to differences between the actual
underlying assets and the hypothetical assets used in preparing the Term Sheet.
The principal amount and designation of any security described in the Term Sheet
are subject to change prior to issuance.
Although a registration statement (including the prospectus) relating to
the securities discussed in this communication has been filed with the
Securities and Exchange Commission and is effective, the final prospectus
supplement relating to the securities discussed in this communication has not
been filed with the Securities and Exchange Commission. This communication
shall not constitute an offer to sell or the solicitation of an offer to buy nor
shall there be any sale of the securities discussed in this communication in any
state in which such offer, solicitations or sale would be unlawful prior to
registration or qualification under the securities laws of any such state.
Prospective purchasers are referred to the final prospectus and prospectus
supplement relating to the securities discussed in this communication for
definitive Term Sheet on any matter discussed in this communication. A final
prospectus and prospectus supplement may be obtained by contacting the Merrill
Lynch Trading Desk and (212) 449-3659.
Please be advised that asset-backed securities may not be appropriate for
all investors. Potential investors must be willing to assume, among other
things, market price volatility, prepayments, yield curve and interest rate
risk. Investors should fully consider the risk of an investment in these
securities.
If you have received this communication in error, please notify the sending
party immediately by telephone and return the original to such party by mail.
[MERRILL LYNCH LOGO] 5
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