AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 10, 2004
                                                      REGISTRATION NO. 333-
================================================================================
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                              --------------------
                             REGISTRATION STATEMENT
                                       ON
                                    FORM S-3
                                      UNDER
                           THE SECURITIES ACT OF 1933
                              --------------------
                                INDYMAC ABS, INC.
             (Exact name of registrant as specified in its charter)

              DELAWARE                                 95-4685267
   (State or Other Jurisdiction          (I.R.S. Employer Identification Number)
of Incorporation or Organization)

                              155 NORTH LAKE AVENUE
                           PASADENA, CALIFORNIA 91101
                                 (800) 669-2300
               (Address, including Zip Code, and Telephone Number,
        including Area Code, of Registrant's Principal Executive Offices)
                              --------------------
                               S. BLAIR ABERNATHY
                                INDYMAC MBS, INC.
                              155 NORTH LAKE AVENUE
                           PASADENA, CALIFORNIA 91101
                                 (800) 669-2300
            (Name, Address, including Zip Code, and Telephone Number,
                   including Area Code, of Agent for Service)

                                 With a copy to:
                              Edward J. Fine, Esq.
                         Sidley Austin Brown & Wood LLP
                               787 Seventh Avenue
                            New York, New York 10019

     APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time on or after the effective date of the registration statement, as
determined by market conditions.

     If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]

     If any of the 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, other than securities offered only in connection with dividend or
interest reinvestment plans, please check the following box. [X]

     If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]

     If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]

     If delivery of the Prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]

                         CALCULATION OF REGISTRATION FEE


================================================================================================================================
                                                                                      PROPOSED MAXIMUM
    TITLE OF EACH CLASS OF         AMOUNT TO BE            PROPOSED MAXIMUM          AGGREGATE OFFERING          AMOUNT OF
 SECURITIES TO BE REGISTERED       REGISTERED(1)      AGGREGATE PRICE PER UNIT(2)          PRICE(2)          REGISTRATION FEE(3)
--------------------------------------------------------------------------------------------------------------------------------

Mortgage Pass-Through
 Securities                       $3,045,217,445                 100%                   $3,045,217,445          $392,033.42
================================================================================================================================


(1)   This Registration Statement relates to the offering from time to time of
      $3,045,217,445 aggregate principal amount of Mortgage Pass-Through
      Securities.

(2)   Estimated for the purpose of calculating the registratrion fee.

(3)   $45,217,445 in securities are being carried forward and $11,933.42 of
      the filing fee is associated with the securities being carried forward
      and was previously paid with the Registrant's registration statement No.
      333-47158. The remaining $380,100 is being paid with the filing of this
      registration statement.

     PURSUANT TO RULE 429 UNDER THE SECURITIES ACT OF 1933, THE PROSPECTUS
INCLUDED IN THIS REGISTRATION STATEMENT IS A COMBINED PROSPECTUS AND RELATES TO
THE REGISTRATION STATEMENT NO. 333-47158 AS PREVIOUSLY FILED BY THE REGISTRANT.
THAT REGISTRATION STATEMENT WAS DECLARED EFFECTIVE ON NOVEMBER 6, 2000.


















     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 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
--------------------------------------------------------------------------------


THE INFORMATION IN THIS PROSPECTUS SUPPLEMENT IS NOT COMPLETE AND MAY BE
CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS
SUPPLEMENT IS NOT AN OFFER TO SELL THESE SECURITIES AND WE ARE NOT SOLICITING
OFFERS TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT
PERMITTED.

                 SUBJECT TO COMPLETION DATED SEPTEMBER 10, 2004

Prospectus Supplement
(To Prospectus dated [          ], 200[ ])

                               $[                ]
                                  (APPROXIMATE)
                    INDYMAC HOME EQUITY LOAN TRUST 200[ ]-[ ]
                                     ISSUER

          HOME EQUITY LOAN ASSET BACKED CERTIFICATES, SERIES 200[ ]-[ ]
                             CLASS [ ] CERTIFICATES
                                INDYMAC ABS, INC.
                                    DEPOSITOR

                         [LOGO OF INDYMAC BANK, F.S.B.]

                           SELLER AND MASTER SERVICER



THE CERTIFICATES
      The Class [  ] certificates have an original principal balance of
$[         ] subject to a permitted variance of plus or minus [10]%.


--------------------------------------------------------------------------------
CONSIDER CAREFULLY THE RISK FACTORS BEGINNING ON PAGE [S-12] IN THIS PROSPECTUS
SUPPLEMENT AND ON PAGE [3] IN THE PROSPECTUS.

The certificates represent obligations of the trust only and do not represent an
interest in or obligation of CWABS, Inc., [IndyMac Bank Home Loans, Inc.] or any
of their affiliates.

This prospectus supplement may be used to offer and sell the certificates only
if accompanied by the prospectus.
--------------------------------------------------------------------------------

                                        PER $1,000 OF
                                        CERTIFICATES           TOTAL
                                        --------------   -----------------
Price to Public...............          $[          ]      $[          ]
Underwriting Discount.........          $[          ]      $[          ]
Proceeds, before expenses, to the
  Depositor...................
                                        $[          ]      $[          ]

THE TRUST FUND

      The trust fund will own a pool consisting of primarily [two] loan groups
of home equity revolving credit line loans made or to be made in the future
under certain home equity revolving credit line loan agreements. The loans will
be secured by first or second deeds of trust or mortgages on one- to four-family
residential properties and will bear interest at rates that adjust based on the
prime rate. The trust fund will also initially include funds from the sale of
the certificates in excess of the cut-off date principal balances. These excess
funds are expected to be used to acquire additional home equity revolving credit
line loans after the cut-off date. The Class [ ] Certificates will represent an
interest in loan group [ ] only.

THE POLICY
     [Certificate Insurer] will issue an irrevocable and unconditional
certificate guaranty insurance policy that will guarantee certain payments to
certificateholders.

                           [CERTIFICATE INSURER LOGO]

     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 PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

         [Underwriter] will offer the certificates subject to prior sale and
subject to its right to reject orders in whole or in part. The certificates will
be issued in [book-entry form] on or about [ ], 200[ ] and will be offered in
the United States [and Europe].

                                  [UNDERWRITER]

[         ], 200[ ]




                                TABLE OF CONTENTS


                              PROSPECTUS SUPPLEMENT

                                                                          PAGE
                                                                          ----

Summary....................................................................S-3
Risk Factors..............................................................S-11
The Master Servicer.......................................................S-19
The Home Equity Loan Program..............................................S-20
Description of the Mortgage Loans.........................................S-22
Maturity and Prepayment Considerations....................................S-33
Pool Factor and Trading Information.......................................S-36
Description of the Certificates...........................................S-37
Description of the Purchase Agreement.....................................S-75
Use of Proceeds...........................................................S-76
Material Federal Income Tax Consequences..................................S-76
State Taxes...............................................................S-81
ERISA Considerations......................................................S-81
Legal Investment Considerations...........................................S-83
Underwriting..............................................................S-84
Legal Matters.............................................................S-84
Experts...................................................................S-85
Ratings...................................................................S-85
Index of Defined Terms....................................................S-86
Annex I..................................................................A-I-1

                                   PROSPECTUS
                                                                          PAGE
                                                                          ----

Important Notice About Information in This
    Prospectus and Each Accompanying
    Prospectus Supplement ...................................................2
Risk Factors.................................................................3
The Trust Fund..............................................................13
Use of Proceeds.............................................................19
The Depositor...............................................................19
Loan Program................................................................20
Description of the Securities...............................................22
Credit Enhancement..........................................................36
Yield and Prepayment Considerations.........................................40
The Agreements..............................................................42
Certain Legal Aspects of the Loans..........................................56
Federal Income Tax Consequences.............................................69
State Tax Considerations....................................................89
ERISA Considerations........................................................89
Legal Investment............................................................94
Method of Distribution......................................................94
Legal Matters...............................................................95
Financial Information.......................................................95
Rating......................................................................95
Index to Defined Terms......................................................96


         Dealers will deliver a prospectus supplement and prospectus when acting
as underwriters of the Series [ ] Certificates and with respect to their unsold
allotments or subscriptions. In addition, all dealers selling the Series [ ]
Certificates will be required to deliver a prospectus supplement and prospectus
until 90 days after the date of this prospectus supplement.

         You should rely on the information contained in this document or to
which we have referred you. We have not authorized anyone to provide you with
information that is different. This document may only be used where it is legal
to sell these securities. The information in this document may only be accurate
on the date of this document.



                                       S-2



                                     SUMMARY


THIS SUMMARY HIGHLIGHTS SELECTED INFORMATION FROM THIS DOCUMENT AND DOES NOT
CONTAIN ALL OF THE INFORMATION THAT YOU NEED TO CONSIDER IN MAKING YOUR
INVESTMENT DECISION. TO UNDERSTAND ALL OF THE TERMS OF AN OFFERING OF THE
CERTIFICATES, CAREFULLY READ THIS ENTIRE DOCUMENT AND THE ACCOMPANYING
PROSPECTUS.

TRUST FUND

IndyMac Home Equity Loan Trust 200[o]-[o]. The trust fund will own a pool of
home equity revolving credit line loans made or to be made in the future under
certain home equity revolving credit line loan agreements. The loans will be
secured by first or second deeds of trust or mortgages on primarily one- to
four-family residential properties and will bear interest at rates that adjust
based on the prime rate. We sometimes refer to these loans as home equity loans
or mortgage loans. [The original principal balance of the certificates will
exceed the aggregate cut-off date principal balances of the home equity loans
initially transferred to the trust fund. Funds in an amount equal to this excess
are expected to be used to acquire additional home equity loans that are not
included in the cut-off date pool. Until they are so used, they will be held in
the trust fund.]

[We will be dividing the mortgage loans in the trust fund into [two] groups.
Each will be referred to as a loan group. The ownership interest of each loan
group will be allocated between the Class [o] Certificates and the Class [o]
Certificates, as applicable, and a single transferor interest. The Class [o]
Certificates will initially represent approximately a 100% interest in loan
group [o] and the Class [o] Certificates will initially represent approximately
a 100% interest in loan group [o]. The percentage interests in each loan group
represented by the certificates will vary over time. The percentage interests in
the trust fund not represented by the certificates will be represented by the
transferor interest, which will also vary over time.

THE OFFERED CERTIFICATES

IndyMac Home Equity Loan Trust 200[o]-[o] will issue [o] classes of Home Equity
Loan Asset Backed Certificates and a transferor interest. Only the Class [o]
Certificates are offered by this prospectus supplement and the accompanying
prospectus and are listed on the cover page of this prospectus supplement.

OTHER CERTIFICATES

IndyMac Home Equity Loan Trust 200[o]-[o] is also issuing the Class [o]
Certificates and the transferor interest. As described in this prospectus
supplement, except for limited cross-collateralization, the Class [o]
Certificates are not supported by the mortgage loans in loan group [o], the
group that supports the offered certificates. As described in this prospectus
supplement, a portion of the transferor interest is subordinated in right of
payment to the Class [ ] and Class [ ] Certificates. Information regarding the
Cut-off Date Class [ ] Certificates and the transferor interest is included in
this prospectus supplement chiefly to provide you with a better understanding of
the Class [ ] Certificates.

DEPOSITOR

IndyMac ABS, Inc., a Delaware corporation, is a limited purpose finance
subsidiary of IndyMac Bank, F.S.B.. Its address is 155


                                       S-3


North Lake Avenue, Pasadena, California 91101, and its telephone number is (800)
669-2300.

See "The Depositor" in the prospectus.

SELLER AND MASTER SERVICER

[IndyMac Bank, F.S.B.]

See "The Master Servicer" in this prospectus supplement.

TRUSTEE

[Name of Trustee].

CERTIFICATE INSURER

[Certificate Insurer], will insure the Class [ ] Certificates as described in
this prospectus supplement.

See "Description of the Certificates--The Certificate Insurer" in this
prospectus supplement.

POOLING AND SERVICING AGREEMENT

The certificates will be issued pursuant to the pooling and servicing agreement
among the seller and master servicer, the depositor, [Fannie Mae] and the
trustee under which the trust fund will be formed.

CUT-OFF DATE
[                 ], 200[ ].

CLOSING DATE
On or about [       ], 200[ ].

DISTRIBUTION DATES

The trustee will make distributions on the [ ] day of each calendar month
beginning in [ ] 200[ ]. If the [ ] day of a month is not a business day, then
distributions will be made on the next business day after the [ ] day of the
month.

RECORD DATE

The [last] day preceding a distribution date or, if the certificates are no
longer book-entry certificates, the last day of the month preceding a
distribution date.

DENOMINATIONS

The Class [ ] Certificates will be issued in minimum denominations of $[25,000]
and multiples of $[1,000] in excess thereof.

REGISTRATION OF CERTIFICATES

The Class [ ] Certificates will initially be issued in book-entry form. Persons
acquiring beneficial ownership interests in the Class [ ] Certificates may elect
to hold their beneficial interests through The Depository Trust Company, in the
United States[, or Clearstream, Luxembourg or the Euroclear System, in Europe].

See "Description of Certificates--Book-Entry Certificates" in this prospectus
supplement.

THE MORTGAGE LOANS

General

The mortgage loans are revolving lines of credit. During the applicable draw
period, each borrower may borrow additional amounts from time to time up to the
maximum amount of that borrower's line of credit. If borrowed amounts are
repaid, they can again be borrowed during the applicable draw period.

The pool balance equals the aggregate of the principal balances of all mortgage
loans in [both] loan groups. The loan group balance of a loan group equals the
aggregate of the

                                      S-4


principal balances of all mortgage loans in that loan group. The principal
balance of a mortgage loan (other than a liquidated mortgage loan) on any day is
equal to

o    its cut-off date principal balance, plus

o    any additional balances in respect of that mortgage loan, minus

o    all collections credited against the principal balance of that mortgage
     loan prior to that day.

Once a mortgage loan is liquidated, its principal balance will be zero.

Loan Rate

Interest on each mortgage loan is payable monthly and computed on the related
daily outstanding principal balance for each day in the billing cycle. The loan
rate is a variable rate per annum equal to the sum of

o    the highest prime rate published in the Money Rates table of The Wall
     Street Journal as of the first business day of each calendar month

     and

o    a margin.

The loan rate is subject to applicable usury limits and certain maximum rates.
Loan rates are adjusted monthly on the first business day of the calendar month
preceding the due date. As to each mortgage loan, the due date is the fifteenth
day of each month.

Principal Payments

Each home equity loan features a draw period during which the loan may be drawn
upon, immediately followed by a repayment period during which the loan must be
repaid. In general, home equity loans with [ ]-year draw periods have [ ]-year
repayment periods. These [ ]-year draw periods are generally extendible for an
additional [ ] years with the approval of the master servicer.

Statistics

The statistical information presented in this prospectus supplement concerning
the pool of mortgage loans does not reflect all of the mortgage loans that will
be included in the pool on the closing date. Instead, such statistical
information relates to statistical calculation loan groups which include the
number and principal balances of only mortgage loans originated by the seller
through the statistical calculation date and included in the applicable loan
group. The aggregate principal balance of each statistical calculation loan
group as of the statistical calculation date is the statistical calculation loan
group balance. The statistical calculation date is [ ], 200[ ].

Unless otherwise noted, all statistical percentages in this prospectus
supplement are measured by the aggregate principal balance of the applicable
statistical calculation loan group on the statistical calculation date.

See "Description of the Mortgage Loans" in this prospectus supplement for
additional information concerning the statistical calculation pool and the
mortgage loans in general.


SUMMARY OF LOANS IN STATISTICAL CALCULATION LOAN GROUP [ ] (AS OF STATISTICAL
CALCULATION DATE)




Loan Group [ ] Statistical Calculation Date Balance ..............   $
Weighted Average Combined Loan-to-Value Ratio ....................                          %



                                      S-5





Weighted Average Margin ..........................................                          %
Range of Principal Balances.......................................   $             0.00 to $
Average Principal Balance ........................................   $
Range of Credit Limits ...........................................   $                  to $
Average Credit Limit .............................................   $
Origination Period ...............................................                    through
Range of Loan Rates ..............................................                    % to  %
Weighted Average Loan Rate .......................................                          %
Weighted Average Maximum Loan Rate ...............................                          %
Weighted Average Minimum Loan Rate ...............................                          %
Maximum Credit Utilization Rate...................................                          %
Average Credit Utilization Rate ..................................                          %
Weighted Average Credit Utilization Rate .........................                          %
Percentage of Pool Secured by 1st Liens ..........................                          %
Percentage of Pool Secured by 2nd Liens ..........................                          %
Weighted Average Second Mortgage Ratio ...........................                          %
Percentage with Mortgaged Properties in:
     [California] ................................................                          %
     [Michigan] ..................................................                          %
     [Colorado]...................................................                          %
     [Illinois]...................................................                          %
     [Florida] ...................................................                          %
Range of Remaining Term to Scheduled Maturity.....................         months to   months
Weighted Average Remaining Term to Scheduled Maturity.............                     months
Percentage Single Family Residences...............................                          %
Percent Owner Occupied............................................                          %




                                      S-6




THE CLASS [ ] CERTIFICATES

Certificate Rate

The certificate rate on the Class [ ] Certificates may change from distribution
date to distribution date. On any distribution date the certificate rate for the
Class [ ] Certificates will equal the least of:

o    LIBOR plus [ ]% per annum,

o    the weighted average of the loan rates on the mortgage loans in loan group
     [ ] minus certain fees, expenses and minimum spread requirements, and

o    [ ] % per annum.

However, on any payment date for which the certificate rate for the Class [ ]
Certificates has been determined pursuant to the weighted average of the net
loan rates on the mortgage loans in loan group [ ], the excess, if any, of the
lesser of

A. [ ]% per annum and

B. LIBOR + [ ]% per annum over the certificate rate will be paid (with interest
at the rate of LIBOR + [ ]% per annum, but not at a rate in excess of [ ] % per
annum) to the Class [ ] Certificates on subsequent distribution dates to the
extent that funds are available in the priority described in this prospectus
supplement.

See "Description of the Certificates--Interest" in this prospectus supplement.

Interest Period

For each distribution date and class of certificates, the period beginning on
the prior distribution date (or in the case of the first distribution date,
beginning on the closing date) and ending on the day before the applicable
distribution date. The trustee will calculate interest based on the actual
number of days in the interest period and a year assumed to consist of 360 days.

CERTIFICATE PRINCIPAL BALANCE

The original principal balance of either class of certificates may be reduced or
increased by not more than [ 10] % depending on the aggregate principal balance
of the mortgage loans in the related loan group actually delivered on the
closing date.

Principal

The amount of principal distributed on a class of certificates on a distribution
date will depend on whether the distribution date occurs during the managed
amortization period or the rapid amortization period.

The managed amortization period begins on the closing date and ends on the
earlier of

o    the distribution date in [    ] and

o    the existence of a rapid amortization event.

The rapid amortization period begins on the first distribution date after the
end of the managed amortization period.

See "Description of Certificates--Principal" in this prospectus supplement.

[ADDITIONAL LOAN ACCOUNT

On the closing date approximately $[ ] will be deposited into an additional loan
account held as a part of the trust fund. These funds represent the excess of
the original principal balance of the Class [ ] Certificates over the cut-off
date principal balance of the mortgage loans in loan group [ ] initially
transferred to the trust fund. These funds are expected to be used through [ ]
to acquire additional home equity loans that are not included in the cut-off
date pool. Any additional home equity loans acquired by the

                                      S-7


trust fund after the cut-off date will have been underwritten using generally
the same guidelines as were used to select the initial mortgage loans in the
trust fund, and the trust fund will have the benefit of substantially the same
representations and warranties covering the initial mortgage loans in the trust
fund. The purchase of these additional home equity loans is in addition to the
ongoing purchase of additional balances during the managed amortization period
with the proceeds of principal repayments received on the trust fund's mortgage
loan portfolio. Any funds remaining in the additional loan account on [ ] will
be used to prepay the Class [ ] Certificates on the first distribution date.]

TERMINATION

The trust fund will terminate on the distribution date following the later of

A. payment in full of all amounts owing to the certificate insurer [and any
third party credit enhancer] and

B. the earliest of

o    the distribution date on which the principal balance of both classes of
     certificates have been reduced to zero,

o    the final payment or other liquidation of the last mortgage loan in the
     trust fund,

o    the optional transfer of the mortgage loans to the owner of the transferor
     interest, as described below, and

o    the distribution date in [ ].

The mortgage loans in the trust fund will be subject to optional transfer to the
owner of the transferor interest on any distribution date on or after which

o    the principal balance of the mortgage loans is reduced to any amount less
     than or equal to [10]% of the sum of the aggregate original principal
     balance of the initial mortgage loans and the aggregate original principal
     balance of any additional home equity loans, and

o    all amounts due and owing to the certificate insurer [and any third party
     credit enhancer], including any unreimbursed draws on the policy [and any
     third party enhancement], together with interest on such amounts, have been
     paid as provided [either] in the insurance agreement under which the policy
     is issued [or in accordance with any third party credit enhancement].

See "Description of the Certificates--Termination; Retirement of the
Certificates" in this prospectus supplement and "The Agreements--Termination;
Optional Termination" in the prospectus.

CREDIT ENHANCEMENT

General

The trust fund includes various mechanisms that are intended to protect
certificateholders against losses on the mortgage loans.

Excess Interest

The trustee will distribute certain interest collections on the mortgage loans
in each loan group to cover losses which would otherwise be allocated to the
certificates related to that loan group, and to the extent described in this
prospectus supplement, to the certificates related to the other loan group.

Limited Subordination of Transferor Interest

The portion of each loan group in the trust fund that is not represented by the
certificates is the transferor interest. [Initially, the transferor interest
will be $0. The transferor interest is expected to grow

                                      S-8


as interest collections in excess of trustee fees, amounts due the certificate
insurer, interest accrued on the certificates and certain loss amounts due on
the certificates are applied as principal distributions on the certificates,
thereby creating overcollateralization of the certificates. For each loan group,
once the required level of overcollateralization is reached, the acceleration
feature for the related Class of Class [ ] Certificates will cease, unless it is
necessary to maintain the required level of overcollateralization.] The
transferor interest also is the mechanism that absorbs changes in the amount of
the mortgage loans in the related loan group due to new borrowings and
repayments. In certain circumstances, amounts that would be distributed on the
transferor interest will instead be distributed on the certificates. IndyMac
Bank, F.S.B. (or one of its affiliates) will be the owner of the transferor
interest on the closing date.

See "Description of the Certificates--Limited Subordination of Transferor
Interest" in this prospectus supplement.

Policy

The policy will irrevocably and unconditionally guarantee on each distribution
date to the trustee for the benefit of the certificateholders the full and
complete payment of the guaranteed distributions consisting of

o    the guaranteed principal distribution amount with respect to the
     certificates for such distribution date, and

o    accrued and unpaid interest due on the certificates.

The effect of the policy is to guarantee the timely payment of interest on, and
the ultimate payment of the principal amount of, the certificates. [The policy
does not cover payment of basis risk carryforward.]

In addition, the policy will guarantee the payment of the outstanding
certificate principal balance on the distribution date in [ ] (after giving
effect to all other amounts distributable and allocable to principal on that
distribution date).

In the absence of payments under the policy, certificateholders will directly
bear the credit and other risks associated with their percentage interest in the
trust fund.

See "Description of the Certificates--The Policy" in this prospectus supplement.

[Limited Crosscollateralization

The pooling and servicing agreement will allow for some limited
cross-collateralization, in that certain excess cashflows from either loan group
on any distribution date will be applied to the funding of certain deficiencies
in interest and principal with respect to the certificates related to the other
loan group.]

[Reserve Fund

On the closing date, an account will be set up in the name of the trustee on
behalf of the certificateholders, but will not be funded. Once the required
level of overcollateralization for a loan group has been reached, excess
cashflow from that loan group may be deposited in the reserve fund on future
distribution dates until the amount reaches a specified level. Amounts in the
reserve fund may be used to cover shortfalls in amounts required to be
distributed as interest to either Class of Class [ ] Certificates or to cover
losses on the mortgage loans in either loan group.]

MATERIAL FEDERAL INCOME TAX CONSEQUENCES

Subject to the qualifications described under "Material Federal Income Tax
Consequences" in this prospectus

                                      S-9


supplement, Sidley Austin Brown & Wood LLP, special tax counsel to the
depositor, is of the opinion that, under existing law, a certificate will be
treated as a debt instrument for federal income tax purposes as of the closing
date. Furthermore, special tax counsel to the depositor is of the opinion that
neither the trust fund nor any portion of the trust fund will be treated as
either an association or a publicly traded partnership taxable as a corporation
or as a taxable mortgage pool.

See "Material Federal Income Tax Consequences" in this prospectus supplement and
"Federal Income Tax Consequences" in the prospectus for additional information
concerning the application of federal income tax laws.

ERISA CONSIDERATIONS

Generally, the notes may be purchased by a pension, employee benefit or other
plan subject to the Employee Retirement Income Security Act of 1974, as amended
or Section 4975 of the Internal Revenue Code of 1986 as amended, or by an entity
investing the assets of such a plan, so long as certain conditions are met. A
fiduciary of an employee benefit or other plan or an individual retirement
account must determine that the purchase of a note is consistent with its
fiduciary duties under applicable law and does not result in a non-exempt
prohibited transaction under applicable law. Any person who acquires a note on
behalf of or with plan assets of an employee benefit or other plan subject to
ERISA or Section 4975 of the Code will be deemed to make certain
representations.

See "ERISA Considerations" in this prospectus supplement and in the prospectus.

LEGAL INVESTMENT CONSIDERATIONS

The Class [ ] Certificates will not constitute mortgage related securities for
purposes of the Secondary Mortgage Market Enhancement Act of 1984, because not
all of the mortgages securing the loans are first mortgages. Accordingly, many
institutions with legal authority to invest in comparably rated securities based
solely on first mortgages may not be legally authorized to invest in the Class [
] Certificates.

See "Legal Investment" in the prospectus.

CERTIFICATE RATING

The certificates will not be offered unless they are each rated [ ] by [Rating
Agency] and [ ] by [Rating Agency] A rating is not a recommendation to buy, sell
or hold securities. These ratings may be lowered or withdrawn at any time by
either of the rating agencies.

See "Ratings" in this prospectus supplement and "Risk Factors--Rating of
Securities Does Not Assure Their Payment" and "Rating" in the prospectus.



                                      S-10


SOME STATEMENTS CONTAINED IN OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS
SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS CONSIST OF FORWARD-LOOKING STATEMENTS
RELATING TO FUTURE ECONOMIC PERFORMANCE OR PROJECTIONS AND OTHER FINANCIAL
ITEMS. THESE STATEMENTS CAN BE IDENTIFIED BY THE USE OF FORWARD-LOOKING WORDS
SUCH AS "MAY," "WILL," "SHOULD," "EXPECTS," "BELIEVES," "ANTICIPATES,"
"ESTIMATES," OR OTHER COMPARABLE WORDS. FORWARD-LOOKING STATEMENTS ARE SUBJECT
TO A VARIETY OF RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO
DIFFER FROM THE PROJECTED RESULTS. THOSE RISKS AND UNCERTAINTIES INCLUDE, AMONG
OTHERS, GENERAL ECONOMIC AND BUSINESS CONDITIONS, REGULATORY INITIATIVES AND
COMPLIANCE WITH GOVERNMENTAL REGULATIONS, CUSTOMER PREFERENCES AND VARIOUS OTHER
MATTERS, MANY OF WHICH ARE BEYOND OUR CONTROL. BECAUSE WE CANNOT PREDICT THE
FUTURE, WHAT ACTUALLY HAPPENS MAY BE VERY DIFFERENT FROM WHAT WE PREDICT IN OUR
FORWARD-LOOKING STATEMENTS.



                                  RISK FACTORS

The following information, which you should carefully consider, identifies
certain significant sources of risk associated with an investment in the
certificates. You should also carefully consider the information set forth under
"Risk Factors" in the prospectus.




YOU MAY HAVE DIFFICULTY SELLING YOUR
CERTIFICATES..............................     The underwriter intends to make a secondary market in the certificates purchased by
                                               it, but has no obligation to do so. We cannot assure you that a secondary market
                                               will develop or, if it develops, that it will continue. Consequently, you may not
                                               be able to sell your certificates readily or at prices that will enable you to
                                               realize your desired yield. The market values of the certificates are likely to
                                               fluctuate; these fluctuations may be significant and could result in significant
                                               losses to you.

                                               The secondary markets for mortgage backed and asset backed securities have
                                               experienced periods of illiquidity and can be expected to do so in the future.
                                               Illiquidity can have a severely adverse effect on the prices of securities that are
                                               especially sensitive to prepayment, credit, or interest rate risk, or that have
                                               been structured to meet the investment requirements of limited categories of
                                               investors.

CASH FLOW DISRUPTIONS COULD CAUSE PAYMENT
DELAYS AND LOSSES.........................     Substantial delays and shortfalls could result from liquidating delinquent mortgage
                                               loans. Resulting shortfalls in distributions to certificateholders could occur if
                                               the certificate insurer were unable to perform its obligations under the policy.
                                               Further, liquidation expenses (such as legal fees, real estate taxes, and
                                               maintenance and preservation expenses) will reduce the security for the


                                                               S-11




                                               related mortgage loans and in turn reduce the proceeds payable to
                                               certificateholders. If any of the mortgaged properties fail to provide adequate
                                               security for the related mortgage loans, you could experience a loss if the
                                               certificate insurer were unable to perform its obligations under the policy.

YIELD AND REINVESTMENT MAY BE
ADVERSELY AFFECTED BY
UNPREDICTABILITY OF PREPAYMENTS ..........     During the period that a borrower may borrow money under the borrower's line of
                                               credit, the borrower may make monthly payments only for the accrued interest or may
                                               also repay some or all of the amount previously borrowed. In addition, borrowers
                                               may borrow additional amounts up to the maximum amounts of their lines of credit.
                                               As a result, the amount each loan group receives in any month (and in turn the
                                               amount distributed to the holders of the related class of certificates) may change
                                               significantly. Even during the repayment period, borrowers generally may prepay
                                               their mortgage loans at any time without penalty. However, prepayments on loans
                                               secured by property in California and certain other jurisdictions may be subject to
                                               account termination fees during the first five years after origination of the loan.
                                               Generally, revolving home equity loans are not viewed by borrowers as permanent
                                               financing. The mortgage loans may be repaid at faster rates than traditional
                                               mortgage loans. The trust fund's prepayment experience may be affected by a wide
                                               variety of factors, including:

                                                   o    general economic conditions,

                                                   o    interest rates, o the availability of alternative financing and

                                                   o    homeowner mobility.

                                               In addition, substantially all of the mortgage loans contain due-on-sale provisions
                                               and the master servicer intends to enforce those provisions unless doing so is not
                                               permitted by applicable law or the master servicer, in a manner consistent with
                                               reasonable commercial practice, permits the purchaser of the mortgaged property in
                                               question to assume the mortgage loan. See "Description of the Certificates" in this
                                               prospectus supplement and "Certain Legal Aspects of the Loans-Due-on-Sale Clauses"
                                               in the prospectus for a description of certain provisions of the credit line
                                               agreements that may affect the prepayment experience on the mortgage loans.

                                                               S-12




                                               The yield to maturity and weighted average life of your certificates will be
                                               affected primarily by

                                               o   the rate and timing of
                                                   repayments and prepayments on
                                                   the mortgage loans in your
                                                   loan group as compared with
                                                   the creation and amount, if
                                                   any, of additional balances
                                                   and,

                                               o the realization of liquidation loss amounts.

                                               You bear the reinvestment risks resulting from a faster or slower rate of principal
                                               payments than you expected. [You also bear the reinvestment risk if by [ ] all of
                                               the funds in the additional loan account have not been used to acquire additional
                                               home equity loans, which would result in a prepayment of the Class [ ] Certificates
                                               in an amount equal to the amount remaining in the additional loan account on that
                                               date.] See "Maturity and Prepayment Considerations" in this prospectus supplement
                                               and "Yield and Prepayment Considerations" in the prospectus.

WITHDRAWAL OR DOWNGRADING OF
INITIAL RATINGS WILL AFFECT THE
VALUE OF THE CERTIFICATES.................     The rating of the certificates will depend primarily on an assessment by the rating
                                               agencies of the mortgage loans and upon the financial strength of the certificate
                                               insurer. Any reduction in a rating assigned to the financial strength of the
                                               certificate insurer may result in a reduction in the rating of the certificates. A
                                               reduction in the rating assigned to the certificates probably would reduce the
                                               market value of the certificates and may affect your ability to sell them.

                                               The rating by each of the rating agencies of the certificates is not a
                                               recommendation to purchase, hold or sell the certificates since that rating does
                                               not address the market price or suitability for a particular investor. The rating
                                               agencies may reduce or withdraw the ratings on the certificates at any time they
                                               deem appropriate. In general, the ratings address credit risk and do not address
                                               the likelihood of prepayments.

JUNIOR LIEN PRIORITY COULD
RESULT IN PAYMENT
DELAY OR LOSS.............................     The mortgage loans are secured by mortgages which generally are second mortgages.
                                               The master servicer has the power under certain circumstances to consent to a new
                                               mortgage lien on the mortgaged property having priority over the mortgage loan in
                                               the trust fund. Mortgage loans

                                                               S-13




                                               secured by second mortgages are entitled to proceeds that remain from the sale of
                                               the related mortgaged property after any related senior mortgage loan and prior
                                               statutory liens have been satisfied. If the remaining proceeds are insufficient to
                                               satisfy the mortgage loans secured by second mortgages and prior liens in the
                                               aggregate and, the certificate insurer is unable to perform its obligations under
                                               the policy, you will bear

                                               o   the risk of delay in distributions while any deficiency judgment
                                                   against the borrower is sought and

                                               o   the risk of loss if the deficiency judgment cannot be obtained or
                                                   is not realized upon.

                                               See "Certain Legal Aspects of the Loans" in the prospectus.

DISTRIBUTIONS TO AND RIGHTS OF
INVESTORS COULD BE ADVERSELY
AFFECTED BY THE BANKRUPTCY OR
INSOLVENCY OF CERTAIN PARTIES ............     [The seller] will treat its sale of the mortgage loans to the depositor as a sale
                                               of the mortgage loans. [However, in the event of insolvency of [IndyMac Bank,
                                               F.S.B.], the Federal Deposit Insurance Corporation (referred to as the FDIC) as
                                               conservator or receiver, could attempt to recharacterize the sale of the mortgage
                                               loans to the depositor as a borrowing secured by a pledge of the mortgage loans. If
                                               such an attempt to recharacterize the transfer of the mortgage loans were
                                               successful, the FDIC could elect to accelerate payments on the notes and liquidate
                                               the mortgage loans with the holders of the notes entitled to no more than the
                                               outstanding principal balances, if any, of the classes of notes together with
                                               interest thereon at the applicable note rate. In the event of the acceleration of
                                               the notes, the holders of the notes would lose the right to future payments of
                                               interest, might suffer reinvestment losses in a lower interest rate environment and
                                               may fail to recover their initial investment. Further, with respect to an
                                               acceleration by the FDIC, interest may be payable only through the date of the
                                               appointment of the FDIC as conservator or receiver. The FDIC has a reasonable
                                               period of time (which it has stated will generally not exceed 180 days after the
                                               date of its appointment) to elect to accelerate payment. Whether or not an
                                               acceleration takes place, delays in payment in the notes and possible reductions in
                                               the amount of such payments could occur]. [In the event of [the seller's]
                                               bankruptcy, the trustee in bankruptcy of [the seller] may argue that the mortgage
                                               loans were not sold but were only pledged to secure a loan to [the seller]. If that
                                               argument is

                                                               S-14




                                               made you could experience delays or reductions in payments on the notes.] The
                                               depositor will warrant in the sale and servicing agreement that the transfer of the
                                               mortgage loans by it to the trust fund is either a valid transfer and assignment of
                                               the mortgage loans to the trust fund or the grant to the trust fund of a security
                                               interest in the mortgage loans.

                                               If certain events relating to the bankruptcy or insolvency of the transferor were
                                               to occur, [no further additional home equity loans would be acquired with any funds
                                               remaining in the additional loan account,] additional balances would not be sold to
                                               the trust fund, and the rapid amortization period would commence.

                                               If the master servicer becomes bankrupt, [the bankruptcy trustee or receiver][FDIC]
                                               may have the power to prevent the appointment of a successor master servicer.

DEVELOPMENTS IN [CALIFORNIA] COULD HAVE
DISPROPORTIONATE EFFECT ON THE POOL OF
MORTGAGE LOANS DUE TO GEOGRAPHIC
CONCENTRATION OF MORTGAGED
PROPERTIES................................     Approximately [ ]% of the mortgage loans in statistical calculation loan group [ ]
                                               and approximately [ ]% of the mortgage loans in statistical calculation loan group
                                               [ ] are secured by mortgaged properties which are located in the State of
                                               [California]. After the statistical calculation date, the geographic concentration
                                               could change as a result of the addition or removal of mortgage loans, prepayments
                                               and/or the creation of additional balances. Property in [California] may be more
                                               susceptible than homes located in other parts of the country to certain types of
                                               uninsurable hazards, such as earthquakes, floods, mudslides and other natural
                                               disasters. In addition:

                                               o    economic conditions in [California] (which may or may not affect real property
                                                    values) may affect the ability of borrowers to repay their loans on time;

                                               o    declines in the [California] residential real estate market may reduce the
                                                    values of properties located in [California], which would result in an
                                                    increase in the loan-to-value ratios; and

                                                               S-15




                                               o    any increase in the market value of properties located in [California] would
                                                    reduce the loan-to-value ratios and could, therefore, make alternative sources
                                                    of financing available to the borrowers at lower interest rates, which could
                                                    result in an increased rate of prepayment of the mortgage loans.

MASTER SERVICER HAS ABILITY TO CHANGE THE
TERMS OF THE MORTGAGE LOANS...............
                                               The master servicer may agree to
                                               changes in the terms of a credit
                                               line agreement, provided that
                                               such changes

                                               o    do not materially and adversely affect the interest of the related
                                                    certificateholders [, any third party credit enhancer or] the certificate
                                                    insurer, and

                                               o    are consistent with prudent business practice.

                                               In addition, the master servicer, within certain limitations, may increase the
                                               credit limit of the related mortgage loan or reduce the loan rate for that mortgage
                                               loan. Any such increase in the credit limit of a mortgage loan would increase the
                                               combined loan-to-value ratio of that mortgage loan and, accordingly, may increase
                                               the likelihood and would increase the severity of loss if a default occurs under
                                               the mortgage loan. In addition, any reduction in the loan rate of a mortgage loan
                                               would reduce the related loan group's excess cash flow available to absorb losses.

YOUR RETURN COULD BE ADVERSELY AFFECTED BY
DELINQUENT MORTGAGE
LOANS.....................................     The trust fund may include mortgage loans that are [59] or fewer days
                                               delinquent as of [     ] (the cut-off date for the pool of mortgage
                                               loans). We expect that the principal balance of mortgage loans that
                                               are between [30] days and [59] days delinquent as of the cut-off date
                                               will not exceed approximately $[      ]. Mortgage loans that are
                                               already delinquent may increase the risk that the trust fund will
                                               experience a loss if

                                               o     there are not sufficient funds from the investor interest collections to
                                                     cover the investor loss amounts for any distribution date,

                                               o     amounts intended to provide protection for the certificates that are
                                                     otherwise payable to the owner of

                                                               S-16




                                                     the transferor interest have been exhausted and

                                               o     the certificate insurer fails to perform its obligations under the policy.

EFFECT OF LOAN RATES ON THE
CERTIFICATES..............................     The certificates accrue interest at a rate based on the one-month LIBOR index plus
                                               a specified margin, but are subject to a cap [based, in part, on the interest rates
                                               on the mortgage loans].

                                               The mortgage loans have interest rates that are based on the prime rate, and have
                                               periodic and maximum limitations on adjustments to the loan rate. As a result, the
                                               certificates may accrue less interest than they would accrue if the certificate
                                               rate were based solely on the LIBOR index plus the specified margin.

                                               A variety of factors could limit the certificate rate. Some of these
                                               factors are described below:

                                               o     Each certificate rate adjusts [monthly] while the loan rates on the mortgage
                                                     loans may adjust less frequently. Consequently, the loan rates may limit
                                                     increases in one or both certificate rates for extended periods in a rising
                                                     interest rate environment.

                                               o     The prime rate may respond to different economic and market factors than
                                                     LIBOR and thus may increase or decrease at different times. As a result, it
                                                     is possible that the loan rates may decline while LIBOR is stable or rising.
                                                     It is also possible that both the loan rates and LIBOR may either decline or
                                                     increase during the same period, but that the loan rates may decline more
                                                     rapidly or increase more slowly than LIBOR.

                                               These factors may adversely affect the yield to maturity on the certificates. Any
                                               basis risk carryforward will be paid on the notes only to the extent of available
                                               funds as described in this prospectus supplement. We cannot assure you that all
                                               basis risk carryforward will be paid. [In addition, the policy does not cover, and
                                               the ratings of the notes do not address the likelihood of, the payment of basis
                                               risk carryforward.

                                               For a discussion of additional risks pertaining to the certificates, see "Risk
                                               Factors" in the prospectus.

                                                               S-17





[CERTAIN RIGHTS MAY BE AFFECTED BY THE
ISSUANCE OF [TWO] CLASSES OF CERTIFICATES
FROM A SINGLE TRUST FUND..................     The ability to declare an event of master servicing termination or to amend the
                                               pooling and servicing agreement rests with the certificate insurer and the holders
                                               of specified percentages of the certificates in both groups. In addition, under
                                               certain circumstances the third party credit enhancer will have such rights as they
                                               relate to the Class [ ] Certificates. As a result you may have less ability to
                                               control certain actions than you would have had if only a single class of
                                               certificates had been issued from the trust fund.]




                                                               S-18



                               THE MASTER SERVICER

GENERAL

         [IndyMac Bank, F.S.B. ("IndyMac Bank") will service the mortgage loans
consisting of [adjustable] rate home equity revolving credit line loans made or
to be made in the future in accordance with the sale and servicing agreement.
The mortgage loans will be secured by either first or second deeds of trust or
mortgages on the residential properties that are primarily single family
properties, individual units in planned unit developments and condominium units.

         IndyMac Bank may perform any of its obligations under the pooling and
servicing agreement dated as of [ ], 200[ ] among IndyMac ABS, Inc., as
depositor, IndyMac Bank, as seller and master servicer, [Name of third party
enhancer, if any] and [Name of trustee], as trustee, through one or more
subservicers. Notwithstanding any such subservicing arrangement, the master
servicer will remain liable for its servicing duties and obligations under the
pooling and servicing agreement as if the master servicer alone were servicing
the mortgage loans. As of the closing date, the master servicer will service the
mortgage loans without subservicing arrangements.]

THE MASTER SERVICER

         [IndyMac Bank will act as master servicer. The principal executive
offices of the master servicer are located at 155 North Lake Avenue, Pasadena,
California 91101. IndyMac Bank is a wholly-owned subsidiary of IndyMac
Intermediate Holdings, Inc., which is a wholly-owned subsidiary of IndyMac
Bancorp, Inc.

         Effective July 1, 2000, IndyMac Mortgage Holdings, Inc. ("Holdings")
acquired SGV Bancorp, the holding company of First Federal Savings and Loan
Association of San Gabriel Valley ("First Federal"). In connection with that
acquisition, IndyMac, Inc., the wholly-owned mortgage banking subsidiary of
Holdings, was merged with and into SGV Bancorp, and SGV Bancorp contributed
substantially all of its assets and liabilities (including the servicing
platform and all of the related servicing operations of the former IndyMac,
Inc., together with substantially all of its personnel) to First Federal. Also
in connection with the acquisition, Holdings changed its name to IndyMac
Bancorp, Inc.; SGV Bancorp changed its name to IndyMac Intermediate Holdings,
Inc. and First Federal changed its name to IndyMac Bank, F.S.B.

         The master servicer will be responsible for servicing the mortgage
loans in accordance with the terms set forth in the pooling and servicing
agreement employing the same degree of skill and care which it employs n
servicing the mortgage loans comparable to the mortgage loans serviced by the
master servicer for itself or others. The master servicer may perform its
servicing obligations under the sale and servicing agreement through one or more
subservicers selected by the master servicer. Notwithstanding any subservicing
agreement, the master servicer will remain liable for its servicing duties and
obligations under the sale and servicing agreement as if the master servicer
alone were servicing the mortgage loans.

         During the first half of 1998, the former IndyMac, Inc. acquired a
servicing platform (i.e., the servicing business operations but not mortgage
loans) from First of America Loan Services,

                                      S-19


Inc. in order to provide IndyMac, Inc. with direct servicing capabilities for
mortgage loans, including home equity revolving credit line loans. Prior to that
time, IndyMac, Inc. had master servicing capabilities but no direct servicing
capabilities. In connection with the acquisition of SGV Bancorp, the servicing
platform of First of America Loan Services, Inc. was contributed to IndyMac
Bank. As of the closing date, it is expected that IndyMac Bank will directly
service substantially all of the initial mortgage loans (by cut-off date pool
principal balance). With respect to the other mortgage loans in the mortgage
pool, as of the closing date, it is expected that IndyMac Bank will perform its
servicing obligations under the sale and servicing agreement through one or more
subservicers.

         If the servicing of any mortgage loan were to be transferred from a
subservicer to IndyMac Bank, or if any other servicing transfer were to occur,
there may be an increase in all delinquencies and defaults due to misapplied or
lost payments, data input errors, system incompatibilities or otherwise.
Although any increase in delinquencies is expected to be temporary, there can be
no assurance as to the duration or severity of any disruption in servicing the
applicable mortgage loans as a result of any servicing transfer.

         As of ___, 200_, IndyMac Bank provided servicing for approximately $___
billion in conventional mortgage loans, of which approximately $[ ] comprised
home equity loans.]

                          THE HOME EQUITY LOAN PROGRAM

UNDERWRITING PROCEDURES RELATING TO HOME EQUITY LOANS

         The following is a description of the underwriting procedures
customarily employed by the seller with respect to home equity loans. The
underwriting process is intended to assess the applicant's credit standing and
repayment ability, and the value and adequacy of the real property security as
collateral for the proposed loan. Exceptions to the seller's underwriting
guidelines will be made when compensating factors are present. Such factors
include the borrower's employment stability, favorable credit history, equity in
the related property and the nature of the underlying first mortgage loan.

 [Description of Specific Underwriting Procedures Relating to Home Equity Loans
     to be Included in the Prospectus Supplement for an Actual Transaction]

SERVICING OF THE MORTGAGE LOANS

         The master servicer has established standard policies for the servicing
and collection of the home equity loans. Servicing includes, but is not limited
to, the collection and aggregation of payments relating to the mortgage loans;
the supervision of delinquent mortgage loans, loss mitigation efforts,
foreclosure proceedings and, if applicable, the disposition of the mortgaged
properties; and the preparation of tax related information in connection with
the mortgage loans.



 [Description of Specific Servicing Procedures Relating to Home Equity Loans to
      be Included in the Prospectus Supplement for an Actual Transaction]

                                      S-20


         Servicing and charge-off policies and collection practices may change
over time in accordance with, among other things, the master servicer's business
judgment, changes in the portfolio and applicable laws and regulations.

FORECLOSURE AND DELINQUENCY EXPERIENCE

         [IndyMac, Inc. commenced master servicing conventional mortgage loans
during April 1993 and commenced servicing conventional mortgage loans during
August 1998. In connection with the acquisition of SGV Bancorp, the master
servicing and servicing operations of the former IndyMac, Inc. were contributed
to IndyMac Bank, resulting in IndyMac Bank performing the master servicing and
servicing operations previously performed by IndyMac, Inc.]

         [The following table summarizes the delinquency and foreclosure
experience, respectively, on the dates indicated, of home equity loans serviced
by the master servicer. The delinquency and foreclosure percentages may be
affected by the size and relative lack of seasoning of the servicing portfolio
because many of such loans were not outstanding long enough to give rise to some
or all of the periods of delinquency indicated in the chart below. Accordingly,
the information should not be considered as a basis for assessing the
likelihood, amount or severity of delinquency or losses on the mortgage loans
and no assurances can be given that the foreclosure and delinquency experience
presented in the table below will be indicative of such experience on the
mortgage loans:

         For the purposes of the following table,

o    The period of delinquency is based on the number of days payments are
     contractually past due.

o    Certain total percentages and dollar amounts may not equal the sum of the
     percentages and dollar amounts indicated in the columns due to differences
     in rounding.

o    "Foreclosure Rate" is the dollar amount of mortgage loans in foreclosure as
     a percentage of the total principal balance of mortgage loans outstanding
     as of the date indicated.

o    "Bankruptcy Rate" is the dollar amount of mortgage loans for which the
     related borrower has declared bankruptcy as a percentage of the total
     principal balance of mortgage loans outstanding as of the date indicated.]

                     DELINQUENCY AND FORECLOSURE EXPERIENCE



                                              AS OF [        ]          AS OF [        ]          AS OF [        ]
                                         ------------------------  ------------------------  ------------------------
                                          PRINCIPAL                 PRINCIPAL                 PRINCIPAL
                                           BALANCE     PERCENTAGE    BALANCE     PERCENTAGE    BALANCE     PERCENTAGE
                                         -----------   ----------  -----------   ----------  -----------   ----------

Portfolio..........................      $[       ]       --        $[       ]       --       $[       ]       --
Delinquency percentage
       30-59 Days..................      $[       ]      [  ]%      $[       ]      [  ]%     $[       ]      [  ]%
       60-89 Days..................      $[       ]      [  ]%      $[       ]      [  ]%     $[       ]      [  ]%
       90+ Days....................      $[       ]      [  ]%      $[       ]      [  ]%     $[       ]      [  ]%
                                         -----------   ----------  -----------   ----------  -----------   ----------
           Total...................      $[       ]      [  ]%      $[       ]      [  ]%     $[       ]      [  ]%
                                         ===========   ==========  ===========   ==========  ===========   ==========
Foreclosure Rate...................      $[       ]      [  ]%      $[       ]      [  ]%     $[       ]      [  ]%
                                         -----------   ----------  -----------   ----------  -----------   ----------
Bankruptcy Rate....................      $[       ]      [  ]%      $[       ]      [  ]%     $[       ]      [  ]%
                                         -----------   ----------  -----------   ----------  -----------   ----------


                                      S-21


         Historically, a variety of factors, including the appreciation of real
estate values, has limited the master servicer's loss and delinquency experience
on its portfolio of serviced mortgage loans. There can be no assurance that
factors beyond the master servicer's control, such as national or local economic
conditions or downturns in the real estate markets of its lending areas, will
not result in increased rates of delinquencies and foreclosure losses in the
future. For example, a general deterioration of the real estate market regions
where the mortgaged properties are located may result in increases in
delinquencies of loans secured by real estate, slower absorption rates of real
estate into the market and lower sales prices for real estate. A general
weakening of the economy may result in decreases in the financial strength of
borrowers and decreases in the value of collateral serving as collateral for
loans. If the real estate market and economy continue to decline, the master
servicer may experience an increase in delinquencies on the loans its services
and higher net losses on liquidated loans.

                        DESCRIPTION OF THE MORTGAGE LOANS

GENERAL

         [Certain statistical information concerning the pool of mortgage loans
(such pool is referred to as the "Statistical Calculation Pool" and each such
mortgage loan is referred to as a "Statistical Calculation Pool Mortgage Loan")
is set forth below. The mortgage pool will be divided into [two] groups of
mortgage loans (each is referred to as a loan group)--loan group [ ] and loan
group [ ]. The Class [ ] Certificates will represent an interest in loan group
[ ] only. Loan group [ ] information is included chiefly to provide a better
understanding about the trust fund. A detailed description of the mortgage loans
actually delivered (the "Detailed Description") will be available to purchasers
of the Certificates at or before, and will be filed on Form 8-K with the
Securities and Exchange Commission within fifteen days after, delivery of the
Certificates. The Detailed Description will specify the aggregate of the
principal balances of the mortgage loans included in the trust fund as of the
cut-off date (the "cut-off date pool balance") and will also include, among
other things, the following information regarding such mortgage loans:

o    the outstanding principal balances of such mortgage loans as of [     ],
     200[ ] (referred to as the "cut-off date") [or the related transfer date],

o    the lien priorities of such mortgage loans,

o    the loan rates borne by such mortgage loans as of the cut-off date,

o    the combined loan-to-value ratios of such mortgage loans,

o    the remaining term to scheduled maturity of such mortgage loans,

o    the type of properties securing such mortgage loans,

                                      S-22


o    the geographical distribution of such mortgage loans by state and

o    the credit limits and credit limit utilization rates of such mortgage loans
     as of the cut-off date.

[The Detailed Description speaks as of the cut-off date and consequently does
not include any Additional Home Equity Loans purchased with the funds in the
additional loan accounts.] The mortgage loans will have been originated pursuant
to credit line agreements and will be secured by mortgages or deeds of trust,
which are either first or second mortgages or deeds of trust, on mortgaged
properties expected to be located in [49 states and the District of Columbia] as
of the cut-off date. The mortgaged properties securing the mortgage loans will
consist of residential properties that are primarily single family residences,
individual units in planned unit developments or condominium units. See
"--Mortgage Loan Terms" below.

         Information regarding the Statistical Calculation Pool Mortgage Loans
as of [     ], 200[ ] (the "Statistical Calculation Date") can be found on the
tables on pages S-__ through S-__.]

MORTGAGE LOAN TERMS

         [General. A borrower may access a mortgage loan by writing a check in a
minimum amount of $[ ]. The mortgage loans bear interest at a variable rate that
changes monthly on the first business day of the related month with changes in
the applicable Index Rate. The Statistical Calculation Pool Mortgage Loans are
subject to a maximum per annum interest rate ranging from [ ]% to [ ]% per
annum, subject to applicable usury limitations. See "Certain Legal Aspects of
the Loans, Applicability of Usury Laws" in the prospectus. The daily periodic
rate on the mortgage loans (i.e., the loan rate) is the sum of the Index Rate
plus the applicable margin, divided by 365 days. The margin generally ranges
between [ ]% and [ ]%. The "Index Rate" is based on the highest "prime rate"
(the "Index") published in the "Money Rates" table of The Wall Street Journal as
of the first business day of each calendar month.

         The second mortgage ratio for a mortgage loan in a second lien position
is the credit limit for the related mortgage loan in a second lien position
divided by the sum of such credit limit and the outstanding principal balance of
any mortgage loan senior to the related mortgage loan as of the date of related
loan application. The weighted average second mortgage loan ratio for the Loan
Group [ ] Statistical Calculation Pool Mortgage Loans was approximately [ ]%.
The weighted average second mortgage ratio for the Loan Group [ ] Statistical
Calculation Pool Mortgage Loans was approximately [ ]%.

         IndyMac Bank [generally offers][may offer] introductory loan rates on
its home equity lines of credit. The introductory rate applies to payments made
during the [first three months] after origination. After such introductory
period, the loan rate will adjust to the Index Rate plus the applicable margin.

         In general, the home equity loans may be drawn upon during a draw
period of [either five years of three years]. Home equity loans with a draw
period of [five] years (which generally may be extendible for an additional
[five] years, upon IndyMac Bank's approval) constitute approximately [ ]% of the
Loan Group [ ] Statistical Calculation Pool Mortgage Loans and

                                      S-23


approximately [ ]% of the Loan Group [ ] Statistical Calculation Pool Mortgage
Loans, each by Statistical Calculation Date Principal Balance. These loans are
generally subject to a [fifteen] year repayment period following the end of the
draw period. During this repayment period, the outstanding principal balance of
the loan will be paid in monthly installments equal to [1/180] of the
outstanding principal balance as of the end of the draw period. Home equity
loans with a draw period of [three] years constitute approximately [ ]% of the
Loan Group [ ] Statistical Calculation Pool Mortgage Loans and approximately [
]% of the Loan Group [ ] Statistical Calculation Pool Mortgage Loans, each by
Statistical Calculation Date Principal Balance. These loans are generally
subject to a [ten] year repayment period following the end of the draw period.
During this repayment period, the outstanding principal balance of the loan will
be paid in monthly installments equal to [1/120] of the outstanding principal
balance as of the end of the draw period.

         The minimum payment due during the draw period will be equal to the
finance charges accrued on the outstanding principal balance of the home equity
loan during the related billing period, any such amounts past due and any other
charges owed. The minimum payment due during the repayment period will be equal
to the sum of the finance charges accrued on the outstanding principal balance
of the mortgage loan during the related billing period, any amounts past due,
any other charges owed and the principal payment described above.

         The "principal balance" of a mortgage loan (other than a Liquidated
Mortgage Loan) on any day is equal to

o    its principal balance as of the cut-off date for the mortgage loans
     purchased on the closing date [and as of the relevant date for the
     additional home equity loan] plus

o    any Additional Balances in respect of such mortgage loan, minus

o    all collections credited against the principal balance of such mortgage
     loan in accordance with the related credit line agreement prior to such
     day.

The principal balance of a Liquidated Mortgage Loan after final recovery of
related liquidation proceeds shall be zero.

         Difference between Statistical Calculation Pool and Cut-off Date Pool.
The statistical information presented in this prospectus supplement for each
loan group reflects the mortgage loans originated by the seller through the
Statistical Calculation Date, and is based on the number and the principal
balances of such mortgage loans in each loan group as of the Statistical
Calculation Date. The depositor expects that the actual pool as of the closing
date will represent approximately $[ ] aggregate principal balance of mortgage
loans. Loan group [ ], which has a Statistical Calculation Date Principal
Balance of approximately $[     ], is expected to have a cut-off date principal
balance of approximately $[     ]. Loan group [ ], which has a Statistical
Calculation Date Principal Balance of approximately $[ ], is expected to have a
cut-off date principal balance of $[ ]. [The trust also will include
approximately $[ ] for loan group [ ] and $[ ] for loan group [ ] in the
relevant additional loan accounts that may be applied to the purchase of
additional mortgage loans as described below.] The [initial] mortgage loans to
be included in the cut-off date pool will represent mortgage loans originated or
to be originated by

                                      S-24


the seller on or prior to the cut-off date and sold by the seller to the
depositor, and by the depositor to the trust fund, on the closing date. In
addition, with respect to the Statistical Calculation Pool Mortgage Loans, as to
which statistical information is presented in this prospectus supplement, some
amortization will occur and some Additional Balances may be created prior to the
cut-off date. Moreover, certain Statistical Calculation Pool Mortgage Loans may
prepay in full or may be determined not to meet the eligibility requirements for
the final cut-off date pool and as a result may not be included in the cut-off
date pool. As a result of the foregoing, the statistical distribution of
characteristics as of the cut-off date for the cut-off date mortgage loan pool
will vary from the statistical distribution of such characteristics of each
Statistical Calculation Loan Group as presented in this prospectus supplement,
although such variance will not be material. In the event that the seller does
not, as of the cut-off date, have the full amount of mortgage loans which the
depositor expects to purchase from the seller and sell to the trust fund on such
date (i.e. approximately $[ ] aggregate principal balance of mortgage loans),
the depositor may reduce the size of the offering. Likewise, if the seller has
more mortgage loans than anticipated, the depositor may increase the size of the
offering. The original principal amount of either Class of Certificates may not
decrease or increase by more than [10]%. [For each loan group, the excess of the
original principal balance of the related certificates over the cut-off date
principal balance of that loan group will be deposited into an account (the
account for loan group [ ], the "Additional Loan Account"). These funds are
expected to be used to acquire additional home equity loans not in the cut-off
date pool (these loans for loan group [ ], the "Additional Home Equity Loans").
Consequently, the statistical distribution characteristics of loan group [ ]
after the addition of Additional Home Equity Loans will vary from that of both
the loan group [ ] cut-off date mortgage loan pool and the Loan Group [ ]
Statistical Calculation Pool Mortgage Loans. Any funds remaining in the
Additional Loan Account on [ ] will be used to prepay the Class [ ] Certificates
on the first distribution date].

         The sum of the columns below may not equal the total indicated for each
loan group due to rounding. The following tables describe the Statistical
Calculation Pool Mortgage Loans in each loan group and the related mortgaged
properties based upon the Loan Group [ ] Statistical Calculation Pool or the
Loan Group [ ] Statistical Calculation Pool, as applicable, as of the close of
business on the Statistical Calculation Date:]


                                      S-25



                                 LOAN GROUP [ ]

                               PRINCIPAL BALANCES



                                                                                              PERCENTAGE OF
                                                                                              LOAN GROUP [ ]
                                                                             AGGREGATE         STATISTICAL
                                                             NUMBER OF        UNPAID           CALCULATION
                                                              MORTGAGE       PRINCIPAL        DATE AGGREGATE
                        RANGE OF PRINCIPAL BALANCES            LOANS          BALANCE       PRINCIPAL BALANCE
                        ---------------------------          ---------   ----------------   -----------------

$            -$      ......................................              $                                %
$            -$      ......................................
$            -$      ......................................
$            -$      ......................................
$            -$      ......................................
$            -$      ......................................
$            -$      ......................................
$            -$      ......................................
$            -$      ......................................
$            -$      ......................................
$            -$      ......................................
$            -$      ......................................
$            -$      ......................................
$            -$      ......................................
$            -$      ......................................
$            -$      ......................................
$            -$
                                                             ---------   ----------------   -----------------
   Total................................................                 $                          100.00%
                                                             =========   ================   =================





                                      S-26



                        COMBINED LOAN-TO-VALUE RATIOS(1)



                                                                                                     PERCENTAGE OF
                                                                                                     LOAN GROUP [ ]
                                                                                   AGGREGATE          STATISTICAL
                                                                    NUMBER OF        UNPAID           CALCULATION
                                                                    MORTGAGE       PRINCIPAL        DATE AGGREGATE
                      RANGE OF COMBINED LOAN-TO-VALUE RATIOS          LOANS         BALANCE        PRINCIPAL BALANCE
                      --------------------------------------       ---------    ----------------   -----------------

  Less Than     %................................................               $                               %
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
                                                                   ---------    ----------------   -----------------
   Total.........................................................               $                          100.00%
                                                                   =========    ================   =================


---------------
(1)  [The ratio (expressed as a percentage) of (A) the sum of (i) the credit
     limit of the mortgage loans and (ii) any outstanding principal balances of
     mortgage loans senior or of equal priority to the mortgage loans
     (calculated generally at the date of origination of the mortgage loans) to
     (B) the lesser of (i) the appraised value of the related mortgaged property
     as set forth in loan files at such date of origination or (ii) in the case
     of a mortgaged property purchased within one year of the origination of the
     related mortgage loan, the purchase price of such mortgaged property.]


                                  LOAN RATES(1)



                                                                                                     PERCENTAGE OF
                                                                                                     LOAN GROUP [ ]
                                                                                   AGGREGATE          STATISTICAL
                                                                    NUMBER OF        UNPAID           CALCULATION
                                                                    MORTGAGE       PRINCIPAL        DATE AGGREGATE
                             RANGE OF LOAN RATES                      LOANS         BALANCE        PRINCIPAL BALANCE
                             -------------------                   ---------    ----------------   -----------------

      -         %................................................               $                               %
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
      -         .................................................
                                                                   ---------    ----------------   -----------------
   Total.........................................................               $                          100.00%
                                                                   =========    ================   =================


---------------
(1)  Approximately [ ]% of the Loan Group [ ] Statistical Calculation Pool
     Mortgage Loans by Statistical Calculation Date Principal Balance are
     currently subject to an introductory rate of [ ]% per annum and [ ]% of the
     Loan Group [ ] Statistical Calculation Pool Mortgage Loans by Statistical
     Calculation Date Principal Balance are currently subject to an introductory
     rate of [ ]% per annum.

                                      S-27



                           GEOGRAPHIC DISTRIBUTION(1)



                                                                                                    PERCENTAGE OF
                                                                                                    LOAN GROUP [ ]
                                                                                   AGGREGATE         STATISTICAL
                                                                    NUMBER OF        UNPAID          CALCULATION
                                                                     MORTGAGE      PRINCIPAL        DATE AGGREGATE
STATE                                                                 LOANS         BALANCE       PRINCIPAL BALANCE
------------------------------------------------------------        ---------    ---------------  -----------------

............................................................                     $                             %
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
                                                                    ---------    ---------------  -----------------
     Total..................................................                     $                       100.00%
                                                                    =========    ===============  =================



------------------
(1) [Geographic location is determined by the address of the mortgaged property
securing the related mortgage loan.]


                                      S-28



                                  PROPERTY TYPE



                                                                                                    PERCENTAGE OF
                                                                                                    LOAN GROUP [ ]
                                                                                   AGGREGATE         STATISTICAL
                                                                    NUMBER OF        UNPAID          CALCULATION
                                                                     MORTGAGE      PRINCIPAL        DATE AGGREGATE
                          PROPERTY TYPE                               LOANS         BALANCE       PRINCIPAL BALANCE
------------------------------------------------------------       ------------  --------------   -----------------

Single Family...............................................                     $                             %
PUD.........................................................
Lo Condo....................................................
2-4 Units...................................................
                                                                   ------------  --------------   -----------------
     Total..................................................                     $                       100.00%
                                                                   ============  ==============   =================


                                  LIEN PRIORITY




                                                                                                    PERCENTAGE OF
                                                                                                    LOAN GROUP [ ]
                                                                                   AGGREGATE         STATISTICAL
                                                                    NUMBER OF        UNPAID          CALCULATION
                                                                     MORTGAGE      PRINCIPAL        DATE AGGREGATE
                          LIEN PRIORITY                               LOANS         BALANCE       PRINCIPAL BALANCE
------------------------------------------------------------       ------------  --------------   -----------------

1st Liens...................................................                     $                             %
2nd Liens...................................................
                                                                   ------------  --------------   -----------------
     Total..................................................                     $                       100.00%
                                                                   ============  ==============   =================


                                     MARGINS



                                                                                                    PERCENTAGE OF
                                                                                                    LOAN GROUP [ ]
                                                                                   AGGREGATE         STATISTICAL
                                                                    NUMBER OF        UNPAID          CALCULATION
                                                                     MORTGAGE      PRINCIPAL        DATE AGGREGATE
                        RANGE OF MARGINS                              LOANS         BALANCE       PRINCIPAL BALANCE
--------------------------------------------------------------     ------------  --------------   -----------------

%.............................................................                   $                             %
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
                                                                   ------------  --------------   -----------------
Total.........................................................                   $                       100.00%
                                                                   ============  ==============   =================


                                      S-29


                        CREDIT LIMIT UTILIZATION RATES(1)



                                                                                                    PERCENTAGE OF
                                                                                                    LOAN GROUP [ ]
                                                                                   AGGREGATE         STATISTICAL
                                                                    NUMBER OF        UNPAID          CALCULATION
                         RANGE OF CREDIT                             MORTGAGE      PRINCIPAL        DATE AGGREGATE
                     LIMIT UTILIZATION RATES                          LOANS         BALANCE       PRINCIPAL BALANCE
--------------------------------------------------------------     ------------  --------------   -----------------

%.............................................................                   $                             %
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
-        .....................................................
                                                                   ------------  --------------   -----------------
Total.........................................................                   $                       100.00%
                                                                   ============  ==============   =================


---------------
(1)  [The "Credit Limit Utilization Rate" is determined by dividing the Loan
     Group [ ] Statistical Calculation Date Balance by the aggregate of the
     credit limits of the related credit line agreements.]


                                  MAXIMUM RATES


                                                                                                    PERCENTAGE OF
                                                                                                    LOAN GROUP [ ]
                                                                                   AGGREGATE         STATISTICAL
                                                                    NUMBER OF        UNPAID          CALCULATION
                                                                     MORTGAGE      PRINCIPAL        DATE AGGREGATE
                          MAXIMUM RATES                               LOANS         BALANCE       PRINCIPAL BALANCE
--------------------------------------------------------------     ------------  --------------   -----------------

%...........................................................                     $                             %
.....................................................
.....................................................
.....................................................
.....................................................
                                                                   ------------  --------------   -----------------
Total.........................................................                   $                       100.00%
                                                                   ============  ==============   =================



                    MONTHS REMAINING TO SCHEDULED MATURITY(1)




                                                                                                    PERCENTAGE OF
                                                                                                    LOAN GROUP [ ]
                                                                                   AGGREGATE         STATISTICAL
                                                                    NUMBER OF        UNPAID          CALCULATION
                                                                     MORTGAGE      PRINCIPAL        DATE AGGREGATE
         RANGE OF MONTHS REMAINING TO SCHEDULED MATURITY              LOANS         BALANCE       PRINCIPAL BALANCE
--------------------------------------------------------------     ------------  --------------   -----------------

-        .....................................................                   $                             %
-        .....................................................
-        .....................................................
-        .....................................................
                                                                   ------------  --------------   -----------------
Total.........................................................                   $                       100.00%
                                                                   ============  ==============   =================


---------------
(1)  [Assumes that the Draw Period for Loan Group [ ] Statistical Calculation
     Pool Mortgage Loans with (a) five year draw periods and fifteen year
     repayment periods will be extended for an additional five years and (b)
     five year draw periods and ten year repayment periods will not be
     extended.]

                                      S-30



                                ORIGINATION YEAR


                                                                                                    PERCENTAGE OF
                                                                                                    LOAN GROUP [ ]
                                                                                   AGGREGATE         STATISTICAL
                                                                    NUMBER OF        UNPAID          CALCULATION
                                                                     MORTGAGE      PRINCIPAL        DATE AGGREGATE
                        ORIGINATION YEAR                              LOANS         BALANCE       PRINCIPAL BALANCE
------------------------------------------------------------       ------------  --------------   -----------------

............................................................                     $                             %
............................................................
                                                                   ------------  --------------   -----------------
    Total...................................................                     $                       100.00%
                                                                   ============  ==============   =================


                               DELINQUENCY STATUS


                                                                                                    PERCENTAGE OF
                                                                                                    LOAN GROUP [ ]
                                                                                   AGGREGATE         STATISTICAL
                                                                    NUMBER OF        UNPAID          CALCULATION
                                                                     MORTGAGE      PRINCIPAL        DATE AGGREGATE
                    NUMBER OF DAYS DELINQUENT                         LOANS         BALANCE       PRINCIPAL BALANCE
------------------------------------------------------------       ------------  --------------   -----------------

Current.....................................................                     $                             %
                                                                   ------------  --------------   -----------------
    Total...................................................                     $                       100.00%
                                                                   ============  ==============   =================



                                  CREDIT LIMITS



                                                                                                    PERCENTAGE OF
                                                                                                    LOAN GROUP [ ]
                                                                                   AGGREGATE         STATISTICAL
                                                                    NUMBER OF        UNPAID          CALCULATION
                                                                     MORTGAGE      PRINCIPAL        DATE AGGREGATE
                     RANGE OF CREDIT LIMITS                           LOANS         BALANCE       PRINCIPAL BALANCE
------------------------------------------------------------       ------------  --------------   -----------------

$                 -$        ..............................                       $                           %
$                 -$        ..............................
$                 -$        ..............................
$                 -$        ..............................
$                 -$        ..............................
$                 -$        ..............................
$                 -$        ..............................
$                 -$        ..............................
$                 -$        ..............................
$                 -$        ..............................
$                 -$        ..............................
$                 -$        ..............................
$                 -$        ..............................
$                 -$        ..............................
$                 -$        ..............................
$                 -$        ..............................
$                 -$        ..............................
                                                                   ------------  --------------   -----------------
    Total...................................................                     $                     100.00%
                                                                   ============  ==============   =================



                                      S-31



CONVEYANCE OF MORTGAGE LOANS

         The obligation of the trust fund to purchase mortgage loans for loan
group [ ] on the closing date is subject to the following requirements, any of
which requirements may be waived or modified in any respect by the Certificate
Insurer:

         o    such mortgage loan may not be 60 or more days delinquent as of the
              closing date;

         o    the remaining term to stated maturity of such mortgage loan will
              not exceed [ ] months;

         o    such mortgage loan will be secured by a mortgage in a first or
              second lien position;

         o    such mortgage loan will not have, a loan rate less than [ ]%;

         o    such mortgage loan will be otherwise acceptable to the Certificate
              Insurer;

         o    following the purchase of such mortgage loan by the trust fund,
              the mortgage loans as of the closing date

              (a) will have a weighted average loan rate of at least [ ]%;

              (b) will have a weighted average remaining term to stated maturity
                  of not more than [ ] months;

              (c) will have a weighted average Combined Loan-to-Value Ratio of
                  not more than [ ]%;

              (d) will have no mortgage loan with a principal balance in excess
                  of $[ ];

              (e) will have a concentration in any one state not in excess [ ]%;
                  and will have a concentration in any one zip code not in
                  excess of [ ]%;

              (f) will have not more than [ ]% in aggregate principal balance of
                  mortgage loans relating to non-owner occupied properties; and

              (g) will not have more than [ ]% in aggregate principal balance of
                  mortgage loans that were appraised electronically;

         o    such mortgage loan shall have a Combined Loan-to-Value Ratio not
              in excess of [ ];

         o    such mortgage loan will have a credit limit between $[ ] and $[ ];

         o    such mortgage loan will have a margin between [ ]% and [ ]%; and

         o    such mortgage loan will comply with the representations and
              warranties in the pooling and servicing agreement.

                                      S-32


         The trust fund may acquire Additional Home Equity Loans through [ ]
that will be included in loan group [ ] so long as they conform to the criteria
listed above. Each Additional Home Equity Loan will have been underwritten
substantially in accordance with the criteria described under "The Home Equity
Loan Program--Underwriting Procedures Relating to Home Equity Loans." Additional
Home Equity Loans will be purchased using amounts on deposit in the Additional
Loan Account at a cash purchase price of [100]% of their principal balance on a
designated cut-off date before [ ]. The amount paid from the Additional Loan
Account for Additional Home Equity Loans will not include accrued interest.
Following each purchase of Additional Home Equity Loans, the aggregate principal
balance of loan group [ ] will increase by an amount equal to the aggregate
principal balance of the Additional Home Equity Loans so acquired and the amount
in the Additional Loan Account will decrease accordingly.

         Any conveyance of Additional Home Equity Loans is subject to various
conditions including:

         o    that they satisfy substantially the same loan representations and
              warranties as the initial home equity loans;

         o    that they were identified by means of a selection process
              reasonably believed not to be adverse to the interests of the
              holders of the certificates and the Certificate Insurer;

         o    that the trust fund receive opinions of counsel acceptable to the
              Certificate Insurer and the trustee with respect to the validity
              of the conveyance of the Additional Home Equity Loans; and

         o    that as of their cut-off date, each Additional Home Equity Loan
              satisfied the eligibility requirements that the mortgage loans had
              to satisfy on the closing date.

[THE ADDITIONAL LOAN ACCOUNT

         The assets of the trust fund will include the Additional Loan Account
that will contain approximately $[    ] on the closing date representing the
excess of the original principal balance of the Class [ ] Certificates over the
cut-off date principal balance of the mortgage loans in loan group [ ] initially
transferred to the trust fund on the closing date. Monies in the Additional Loan
Account are expected to be used to purchase Additional Home Equity Loans through
[     ]. The Additional Loan Account will be part of the trust fund, but will
not be available to cover losses on the mortgage loans. Any funds remaining on
deposit in the Additional Loan Account on [     ] will be used to prepay the
Class [ ] Certificates on the first distribution date. Net income on investment
of funds in the Additional Loan Account will be paid to the master servicer, and
will not be available for payment on the Certificates.]

                     MATURITY AND PREPAYMENT CONSIDERATIONS

         The pooling and servicing agreement, except as otherwise described in
this prospectus supplement, provides that the Certificateholders will be
entitled to receive on each distribution date distributions of principal, in the
amounts described under "Description of the Certificates--Distributions on the
Certificates" in this prospectus supplement, until the certificate principal

                                      S-33


balance is reduced to zero. During the Managed Amortization Period,
Certificateholders will receive amounts from principal collections based upon
the applicable Investor Fixed Allocation Percentage for the related loan group,
subject to reduction as described below. [In addition, the funds remaining in
the Additional Loan Account on [ ] after the purchase of any Additional Home
Equity Loans on that date will be used to prepay the Class [ ] Certificates on
the first distribution date.] With respect to any date of calculation on or
prior to the first distribution date on which the balance of the Transferor
Interest with respect to such loan group is equal to the applicable Required
Transferor Subordinated Amount, the "Investor Fixed Allocation Percentage" will
equal the greater of (i) [ ]% and (ii) 100% minus the percentage obtained by
dividing the      amount of the Transferor Interest allocable to a loan group
at the beginning of such Collection Period by the loan group balance at the
beginning of such Collection Period. Thereafter, the Investor Fixed Allocation
Percentage will equal [ ]%. During the related Rapid Amortization Period,
Certificateholders will receive amounts from principal collections based solely
upon the Investor Fixed Allocation Percentage for the related loan group.
Because prior distributions of principal collections to Certificateholders serve
to reduce the related Investor Floating Allocation Percentage but may not change
the related Investor Fixed Allocation Percentage in all instances, allocations
of principal collections from the mortgage loans in a loan group based on the
related Investor Fixed Allocation Percentage may result in distributions of
principal to the Certificateholders in amounts that are, in most cases, greater
relative to the declining balance of the mortgage loans in that loan group than
would be the case if the related Investor Floating Allocation Percentage were
used to determine the percentage of principal collections from the mortgage
loans in that loan group distributed to Certificateholders. This is especially
true during the Rapid Amortization Period when the Certificateholders are
entitled to receive their respective Investor Principal Collections and not a
lesser amount. In addition, respective Investor Interest Collections may be
distributed as principal to Certificateholders of Certificates in a particular
loan group in connection with the applicable Accelerated Principal Distribution
Amount, if any. Moreover, to the extent of losses allocable to the
Certificateholders of Certificates related to a particular loan group, those
Certificateholders may also receive as payment of principal the amount of such
losses from the related Investor Interest Collections, Investor Interest
Collections from the other loan group, the Subordinated Transferor Collections,
[the Reserve Fund,] or, in some instances, draws under the Policy [or payments
under any third party enhancement]. The level of losses may therefore affect the
rate of payment of principal on the Certificates.

         [As of the closing date, the Transferor Interest with respect to each
loan group will be $0. The Transferor Interest is expected to grow in the early
months of the transaction due to the payment of the applicable Accelerated
Principal Distribution Amount.] [In addition,] to the extent obligors make more
draws than principal payments on the mortgage loans in a loan group, the
Transferor Interest may grow. An increase in the Transferor Interest due to
additional draws may also result in Certificateholders receiving principal at a
greater rate during the Rapid Amortization Period because the
Certificateholders' share of principal collections on the mortgage loans in a
loan group is based upon the applicable Investor Fixed Allocation Percentage
(without reduction). The pooling and servicing agreement permits the Transferor,
at its option, but subject to the satisfaction of certain conditions specified
in the pooling and servicing agreement, including the conditions described
below, to remove certain mortgage loans from a loan group at any time during the
life of the trust fund, so long as the portion of the Transferor Interest
related to the applicable loan group (after giving effect to such removal) is

                                      S-34


not less than the related Minimum Transferor Interest. Such removals may affect
the rate at which principal is distributed to Certificateholders by reducing the
overall loan group balance and thus the related amount of principal collections.
See "Description of the Certificates--Optional Transfers of Mortgage Loans to
the Transferor" in this prospectus supplement.

         All of the mortgage loans may be prepaid in full or in part at any
time. However, mortgage loans secured by mortgaged properties in [ ] are subject
to an account termination fee equal to the lesser of $[ ] or [ ] months interest
on the amount prepaid, to the extent the prepaid amount exceeds [ ]% of the
unpaid principal balance, if the account is terminated on or before its [ ] year
anniversary. In addition, mortgage loans secured by mortgaged properties in
other jurisdictions may be subject to account termination fees to the extent
permitted by law. In general, such account termination fees do not exceed $[ ]
and do not apply to accounts terminated subsequent to a date designated in the
related mortgage note which, depending on the jurisdiction, ranges between [ ]
months and [ ] years following origination. The prepayment experience with
respect to the mortgage loans in a loan group will affect the weighted average
life of the related Certificates.

         The rate of prepayment on the mortgage loans cannot be predicted.
Generally, it is assumed that home equity revolving credit lines are not viewed
by borrowers as permanent financing. Accordingly, the mortgage loans may
experience a higher rate of prepayment than traditional first mortgage loans. On
the other hand, because the mortgage loans amortize as described under
"Description of the Mortgage Loans--Mortgage Loan Terms" in this prospectus
supplement, rates of principal payments on the mortgage loans will generally be
slower than those of traditional fully-amortizing first mortgages in the absence
of prepayments on such mortgage loans. The prepayment experience of the mortgage
loans in a loan group may be affected by a wide variety of factors, including
general economic conditions, prevailing interest rate levels, the availability
of alternative financing, homeowner mobility, the frequency and amount of any
future draws on the credit line agreements and changes affecting the
deductibility for federal income tax purposes of interest payments on home
equity credit lines. Substantially all of the mortgage loans contain
"due-on-sale" provisions, and the master servicer intends to enforce such
provisions, unless

         o    such enforcement is not permitted by applicable law or

         o    the master servicer, in a manner consistent with reasonable
              commercial practice, permits the purchaser of the related
              mortgaged property to assume the mortgage loan.

The enforcement of a "due-on-sale" provision will have the same effect as a
prepayment of the related mortgage loan. See "Certain Legal Aspects of the
Loans--Due-on-Sale Clauses" in the prospectus.

         The seller is not required to deliver certain documents relating to the
mortgage loans to the trustee until [30] days after the closing date [(or in the
case of the Additional Home Equity Loans, until 20 days after they are acquired
by the trust fund)]. See "Description of the Certificates--Assignment of
Mortgage Loans" in this prospectus supplement. If the seller fails to deliver
all or a portion of such documents with respect to any such mortgage loan to the
depositor, or, at the depositor's direction, to the trustee within such period,
the seller will be

                                      S-35


obligated to accept the transfer of such mortgage loan from the trust fund. Upon
such transfer, the principal balance of such mortgage loan will be deducted from
the related loan group balance, thus reducing the amount of the Transferor
Interest related to such loan group. If the deduction would cause such portion
of the Transferor Interest to become less than the related Minimum Transferor
Interest at such time, the seller will be obligated to either substitute an
Eligible Substitute Mortgage Loan or make a deposit into the Collection Account
in an amount equal to the amount by which such portion of the Transferor
Interest would be reduced to less than the related Minimum Transferor Interest
at such time. Any such deduction, substitution or deposit, will be treated under
the pooling and servicing agreement as a payment in full of such mortgage loan.

         The yield to an investor who purchases the Certificates in the
secondary market at a price other than par will vary from the anticipated yield
if the rate of prepayment on the mortgage loans in the related loan group is
actually different than the rate anticipated by such investor at the time such
Certificates were purchased.

         Collections on the mortgage loans may vary because, among other things,
borrowers may make payments during any month as low as the minimum monthly
payment for such month or as high as the entire outstanding principal balance
plus accrued interest and the fees and charges thereon. It is possible that
borrowers may fail to make scheduled payments. Collections on the mortgage loans
may vary due to seasonal purchasing and payment habits of borrowers.

         No assurance can be given as to the level of prepayments that will be
experienced by the trust fund and it can be expected that a portion of borrowers
will not prepay their mortgage loans to any significant degree. See "Yield and
Prepayment Considerations" in the prospectus.

                       POOL FACTOR AND TRADING INFORMATION

         The "Pool Factor" is a seven-digit decimal that the master servicer
will compute monthly expressing the Certificate Principal Balance of each Class
of Certificates as of each distribution date (after giving effect to any
distribution of principal to that Class of Certificates on such distribution
date) as a proportion of the Original Certificate Principal Balance. On the
closing date, the Pool Factor for each Class of Certificates will be 1.0000000.
See "Description of the Certificates--Distributions on the Certificates" in this
prospectus supplement. Thereafter, the Pool Factor for each Class of
Certificates will decline to reflect reductions in the related certificate
principal balance resulting from distributions of principal to that Class of
Certificates and the related Invested Amount of any unreimbursed Liquidation
Loss Amounts from mortgage loans in the related loan group.

         Pursuant to the pooling and servicing agreement, monthly reports
concerning the Invested Amount, the Pool Factor and various other items of
information for each Class of Certificates will be made available to the
Certificateholders. In addition, within [60] days after the end of each calendar
year, beginning with the 200[ ] calendar year, information for tax reporting
purposes will be made available to each person who has been a Certificateholder
of record at any time during the preceding calendar year. See "Description of
the Certificates--Book-Entry Certificates" and "--Reports to Certificateholders"
in this prospectus supplement.

                                      S-36


                         DESCRIPTION OF THE CERTIFICATES

         The Home Equity Loan Asset Backed Certificates Class [ ] and Class [ ]
(each is sometimes referred to as a "Class"), Series 200[ ]-[ ] (the
"Certificates") will be issued pursuant to the pooling and servicing agreement.
The form of the pooling and servicing agreement has been filed as an exhibit to
the Registration Statement of which this prospectus supplement and the
prospectus is a part. The following is a description of the material provisions
of the pooling and servicing agreement. Wherever particular sections or defined
terms of the pooling and servicing agreement are referred to, such sections or
defined terms are hereby incorporated in this prospectus supplement by
reference.

GENERAL

         The Class [ ] Certificates will be issued in denominations of $[25,000]
and multiples of $[1,000] in excess thereof and will evidence specified
undivided interests in loan group [ ]. Together with the Transferor Interest and
the Class [ ] Certificates (which are not offered by this prospectus
supplement), they comprise IndyMac Home Equity Loan Trust 200[ ]-[ ] (referred
to as the trust fund). The property of the trust fund will consist of, to the
extent provided in the pooling and servicing agreement:

         o    the principal balance of each mortgage loan as of the cut-off date
              (referred to as the cut-off date principal balance), plus any new
              advances made in respect thereof under the applicable credit line
              agreement during the life of the trust fund ("Additional
              Balances");

         o    collections on the mortgage loans received after the cut-off date
              (exclusive of payments in respect of accrued interest due on or
              prior to the cut-off date);

         o    mortgaged properties relating to the mortgage loans that are
              acquired by foreclosure or deed in lieu of foreclosure;

         o    the Collection Account for the Certificates (excluding net
              earnings thereon);

         o    [the Additional Loan Account and the similar account for loan
              group 1 and any additional loans purchased with their proceeds;]

         o    [the Reserve Fund (excluding net earnings thereon);]

         o    the Policy and any further credit enhancement for the Class [ ]
              Certificates only; and

         o    an assignment of the depositor's rights under the Purchase
              Agreement.

Definitive Certificates (as defined below), if issued, will be transferable and
exchangeable at the corporate trust office of the trustee, which will initially
maintain the Security Register for the Certificates. See "--Book-Entry
Certificates" below. No service charge will be made for any registration of
exchange or transfer of Certificates, but the trustee may require payment of a
sum sufficient to cover any tax or other governmental charge.

                                      S-37


         The aggregate undivided interest in the trust fund represented by the
Certificates as of the closing date is expected to equal approximately $[ ] (the
"Original Invested Amount"), which represents approximately [100]% of the sum of
the cut-off date pool balance [and the additional loan accounts]. As of the
closing date, the Class [ ] Certificates are expected to equal approximately $[
] (the "Class [ ] Original Invested Amount"), which represents approximately
[100]% of the sum of the cut-off date loan group [ ] principal balance [and
approximately $[ ] deposited in the related additional loan account]. The "Class
[ ] Original Certificate Principal Balance" is expected to equal approximately
$[ ]. As of the closing date, the Class [ ] Certificates are expected to equal
approximately $[ ] (the "Class [ ] Original Invested Amount"), which represents
approximately [100]% of the sum of the cut-off date loan group [ ] principal
balance [and the amount deposited in the Additional Loan Account]. The "Class [
] Original Certificate Principal Balance" is expected to equal approximately $[
]. [Of the Class [ ] Original Invested Amount approximately $[ ] represents the
proceeds deposited into the Additional Loan Account which may be used through [
] to purchase additional home equity loans for addition to loan group [ ].
Following the closing date, the "Invested Amount" for each Class of Certificates
with respect to any distribution date will be an amount equal to the Original
Invested Amount for such Class of Certificates minus

         o    the amount of the related Investor Principal Collections
              previously distributed on such Class of Certificates [and any
              return of the related additional loan account funds], minus

         o    an amount equal to the product of the related Investor Floating
              Allocation Percentage and the Liquidation Loss Amounts on the
              mortgage loans in the related loan group (each as defined in this
              prospectus supplement) for such distribution date.

For each Class of Certificates, the principal amount of the outstanding
Certificates in that Class (the "Certificate Principal Balance") on any
distribution date is equal to the applicable Original Certificate Principal
Balance minus the aggregate of amounts actually distributed as principal to the
certificates in that Class. See "--Distributions on the Certificates" below.
Each Certificate represents the right to receive payments of interest at the
related Certificate Rate and payments of principal as described below.

         The remaining interest in the mortgage loans in the trust fund will be
represented by a single transferor interest (the "Transferor Interest") that
will be owned by the transferor. In each loan group, the portion of the
Transferor Interest in that loan group, as of any date of determination, will
equal the related loan group balance as of the close of business on the day
preceding such date of determination, less the Invested Amount for such loan
group as of the close of business on the preceding distribution date. The
Required Transferor Subordinated Amount initially is approximately $[ ], which,
in the aggregate, will represent approximately [ ]% of the cut-off date loan
group [ ] balance [and the amount originally deposited in the related additional
loan account plus approximately [ ]% of the cut-off date loan group [ ] balance
and the amount originally deposited in the Additional Loan Account], but the
pooling and servicing agreement requires the Transferor Interest (once it is
fully funded) to be at least equal to the Minimum Transferor Interest (as
defined in this prospectus supplement). The owner of the Transferor Interest
(the "Transferor") will initially be the seller (or one of its

                                      S-38


affiliates). In general, the loan group balance of each loan group will vary
each day as principal is paid on the mortgage loans in that loan group,
liquidation losses are incurred and Additional Balances are drawn down by
borrowers on mortgage loans in that loan group and transferred to the related
loan group.

         [The Certificate Insurer will require, based upon the terms and
conditions of the Insurance Agreement, that the portion of the Transferor
Interest with respect to each Class of certificates be maintained at the related
Required Transferor Subordinated Amount with respect to such Class.

         The portion of the Transferor Interest related to each Class of
Certificates as of the closing date will be zero, which is less than the initial
Required Transferor Subordinated Amount, thus requiring an increase in the
Transferor Interest on future distribution dates until it equals the Required
Transferor Subordinated Amount.

         With respect to each Class of Certificates, certain excess cashflow
will be applied as a payment of principal of that Class of Certificates on each
distribution date to increase or maintain the portion of the Transferor Interest
related to that Class to or at the Required Transferor Subordinated Amount for
such Class for such distribution date. The amount of such excess cashflow with
respect to a Class of Certificates so applied as a payment of principal on a
distribution date is an "Accelerated Principal Distribution Amount" for the
related Class of Certificates. The requirement to maintain the Transferor
Interest at the Required Transferor Subordinated Amount, or to increase it to
the Required Transferor Subordinated Amount, is not an obligation of the seller,
the master servicer, the trustee, the Certificate Insurer or any other person.

         The pooling and servicing agreement requires excess cashflow not
required to maintain or achieve the Required Transferor Subordinated Amount of
the related Class of Certificates to be applied to the funding of a reserve
fund, which has been required by the Certificate Insurer to be established and
maintained with respect to the certificates (the "Reserve Fund"). The amount on
deposit in the Reserve Fund will not exceed the excess of (x) the sum of the
Required Transferor Subordinated Amounts with respect to each Class of
Certificates over (y) the sum of the portion of the Transferor Interest with
respect to each Class of Certificates. Amounts in the Reserve Fund may only be
withdrawn therefrom and applied in accordance with the terms of the pooling and
servicing agreement.

         The Certificate Insurer may permit the Required Transferor Subordinated
Amount for a Class of Certificates to decrease or "step down" over time, subject
to certain floors and triggers. The dollar amount of any decrease in a Required
Transferor Subordinated Amount is an "Overcollateralization Reduction Amount,"
which, with respect to each Class of Certificates, may result in a release of
cash from the trust fund in an amount up to such Overcollateralization Reduction
Amounts (net of any Reimbursement Amounts due to the Certificate Insurer),
and/or result in the removal of cash or mortgage loans from the trust fund on
distribution dates occurring after such step-downs take effect. The dollar
amount of any Overcollateralization Reduction Amount with respect to a Class
will first be released from the Reserve Fund, to the extent of the amount on
deposit therein. If the amount on deposit in the Reserve Fund with respect to a
Class is not sufficient to fund the full amount of such Overcollateralization

                                      S-39


Reduction Amount with respect to such Class, then an amount equal to the
remaining portion of such Overcollateralization Reduction Amount will be
released from the monthly cashflow with respect to such Class, thus reducing the
portion of the Transferor Interest for such Class.]

         The Transferor has the right to sell or pledge the Transferor Interest
at any time, provided

         o    the Rating Agencies have notified the Transferor and the Trustee
              in writing that such action will not result in the reduction or
              withdrawal of the ratings assigned to the Certificates without
              regard to the Policy [or any other third party credit
              enhancements], and

         o    certain other conditions specified in the pooling and servicing
              agreement are satisfied.

BOOK-ENTRY CERTIFICATES

         The Class [ ] Certificates will initially be book-entry certificates.
Persons acquiring beneficial ownership interests in the Class [ ] Certificates
("Certificate Owners") may elect to hold their Class [ ] Certificates through
The Depository Trust Company ("DTC") in the United States, or Clearstream,
Luxembourg or Euroclear in Europe, if they are participants of such systems, or
indirectly through organizations which are participants in such systems. The
book-entry certificates will be issued in one or more certificates which equal
the aggregate principal balance of the Certificates and will initially be
registered in the name of Cede & Co., the nominee of DTC. Clearstream,
Luxembourg and Euroclear will hold omnibus positions on behalf of their
participants through customers' securities accounts in Clearstream, Luxembourg's
and Euroclear's names on the books of their respective depositaries which in
turn will hold such positions in customers' securities accounts in the
depositaries' names on the books of DTC. Citibank N.A. will act as depositary
for Clearstream, Luxembourg and The Chase Manhattan Bank will act as depositary
for Euroclear (in such capacities, individually the "Relevant Depositary" and
collectively the "European Depositaries"). Investors may hold such beneficial
interests in the book-entry certificates in minimum denominations representing
Certificate Principal Balances of $[25,000] and in multiples of $[1,000] in
excess thereof. One investor in the book-entry certificates may hold a
beneficial interest therein that is not an integral multiple of $[1,000]. Except
as described below, no person acquiring a book-entry certificate (each, a
"beneficial owner") will be entitled to receive a definitive certificate
representing such Certificate. 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. Certificate Owners will not be
Certificateholders as that term is used in the pooling and servicing agreement.
Certificate Owners are only permitted to exercise their rights indirectly
through the participating organizations that utilize the services of DTC,
including securities brokers and dealers, banks and trust companies and clearing
corporations and certain other organizations ("Participants") and DTC.

         The beneficial owner's ownership of a book-entry certificate will be
recorded on the records of the brokerage firm, bank, thrift institution or other
financial intermediary (each, a "Financial Intermediary") that maintains the
beneficial owner's account for such purpose. In turn, the Financial
Intermediary's ownership of such book-entry certificate will be recorded on the
records of DTC (or of a participating firm that acts as agent for the Financial
Intermediary,

                                      S-40


whose interest will in turn be recorded on the records of DTC, if the beneficial
owner's Financial Intermediary is not a DTC participant and on the records of
Clearstream, Luxembourg or Euroclear, as appropriate).

         Certificate Owners will receive all distributions of principal of, and
interest on, the Certificates from the trustee through DTC and DTC Participants.
While the Certificates are outstanding (except under the circumstances described
below), 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 distributions of principal of, and interest
on, the Certificates. Participants and organizations which have indirect access
to the DTC system, such as banks, brokers, dealers and trust companies that
clear through or maintain a custodial relationship with a Participant, either
directly or indirectly ("Indirect Participants"), with whom Certificate Owners
have accounts with respect to Certificates are similarly required to make
book-entry transfers and receive and transmit such distributions on behalf of
their respective Certificate Owners. Accordingly, although Certificate Owners
will not possess certificates, the Rules provide a mechanism by which
Certificate Owners will receive distributions and will be able to transfer their
interest.

         Certificate Owners will not receive or be entitled to receive
certificates representing their respective interests in the Certificates, except
under the limited circumstances described below. Unless and until definitive
certificates are issued, Certificate Owners who are not Participants may
transfer ownership of Certificates only through Participants and Indirect
Participants by instructing such Participants and Indirect Participants to
transfer Certificates, by book-entry transfer, through DTC for the account of
the purchasers of such Certificates, which account is maintained with their
respective Participants. Under the Rules and in accordance with DTC's normal
procedures, transfers of ownership of Certificates will be executed through DTC
and the accounts of the respective Participants at DTC will be debited and
credited. Similarly, the Participants and Indirect Participants will make debits
or credits, as the case may be, on their records on behalf of the selling and
purchasing Certificate Owners.

         Because of time zone differences, credits of securities received in
Clearstream, Luxembourg or Euroclear as a result of a transaction with a
Participant will be made during subsequent securities settlement processing and
dated the business day following the DTC settlement date. Such credits or any
transactions in such securities settled during such processing will be reported
to the relevant Euroclear or Clearstream, Luxembourg Participants on such
business day. Cash received in Clearstream, Luxembourg or Euroclear as a result
of sales of securities by or through a Clearstream, Luxembourg Participant (as
defined below) or Euroclear Participant (as defined below) to a DTC Participant
will be received with value on the DTC settlement date but will be available in
the relevant Clearstream, Luxembourg or Euroclear cash account only as of the
business day following settlement in DTC. For information with respect to tax
documentation procedures relating to the Certificates, see "Material Federal
Income Tax Consequences--Foreign Investors" and "--Backup Withholding" in this
prospectus supplement and "Global Clearance, Settlement And Tax Documentation
Procedures--Certain U.S. Federal Income Tax Documentation Requirements" in Annex
1 in this prospectus supplement.

                                      S-41


         Transfers between Participants will occur in accordance with DTC rules.
Transfers between Clearstream, Luxembourg Participants and Euroclear
Participants will occur in accordance with their respective rules and operating
procedures.

         Cross-market transfers between persons holding directly or indirectly
through DTC, on the one hand, and directly or indirectly through Clearstream,
Luxembourg Participants or Euroclear Participants, on the other, will be
effected in DTC in accordance with DTC rules on behalf of the relevant European
international clearing system by the Relevant Depositary; however, such
cross-market transactions will require delivery of instructions to the relevant
European international clearing system by the counterparty in such system in
accordance with its rules and procedures and within its established deadlines
(European time). The relevant European international clearing system will, if
the transaction meets its settlement requirements, deliver instructions to the
Relevant Depositary to take action to effect final settlement on its behalf by
delivering or receiving securities in DTC, and making or receiving payment in
accordance with normal procedures for same day funds settlement applicable to
DTC. Clearstream, Luxembourg Participants and Euroclear Participants may not
deliver instructions directly to the European Depositaries.

         DTC, which is a New York-chartered limited purpose trust company,
performs services for its participants, some of which (and/or their
representatives) own DTC. In accordance with its normal procedures, DTC is
expected to record the positions held by each DTC participant in the book-entry
certificates, whether held for its own account or as a nominee for another
person. In general, beneficial ownership of book-entry certificates will be
subject to the rules, regulations and procedures governing DTC and DTC
participants as in effect from time to time.

         Clearstream Banking, societe anonyme, 67 Bd Grande-Duchesse Charlotte,
L-2967 Luxembourg ("Clearstream, Luxembourg"), was incorporated in 1970 as
"Cedel S.A.," a company with limited liability under Luxembourg law (a societe
anonyme). Cedel S.A. subsequently changed its name to Cedelbank. On 10 January
2000, Cedelbank's parent company, Cedel International, societe anonyme ("CI")
merged its clearing, settlement and custody business with that of Deutsche Borse
Clearing AG ("DBC"). The merger involved the transfer by CI of substantially all
of its assets and liabilities (including its shares in CB) to a new Luxembourg
company, New Cedel International, societe anonyme ("New CI"), which is 50% owned
by CI and 50% owned by DBC's parent company Deutsche Borse AG. The shareholders
of these two entities are banks, securities dealers and financial institutions.
Cedel International currently has 92 shareholders, including U.S. financial
institutions or their subsidiaries. No single entity may own more than 5 percent
of Cedel International's stock.

         Further to the merger, the Board of Directors of New Cedel
International decided to re-name the companies in the group in order to give
them a cohesive brand name. The new brand name that was chosen is "Clearstream."
With effect from 14 January 2000 New CI has been renamed "Clearstream
International, societe anonyme." On 18 January 2000, Cedelbank was renamed
"Clearstream Banking, societe anonyme," and Cedel Global Services was renamed
"Clearstream Services, societe anonyme."

         On 17 January 2000 DBC was renamed "Clearstream Banking AG." This means
that there are now two entities in the corporate group headed by Clearstream
International which

                                      S-42


share the name "Clearstream Banking," the entity previously named "Cedelbank"
and the entity previously named "Deutsche Brse Clearing AG."

         Clearstream, Luxembourg holds securities for its customers and
facilitates the clearance and settlement of securities transactions between
Clearstream, Luxembourg customers through electronic book-entry changes in
accounts of Clearstream, Luxembourg customers, thereby eliminating the need for
physical movement of certificates. Transactions may be settled by Clearstream,
Luxembourg in any of 36 currencies, including United States dollars.
Clearstream, Luxembourg provides to its customers, among other things, services
for safekeeping, administration, clearance and settlement of internationally
traded securities and securities lending and borrowing. Clearstream, Luxembourg
also deals with domestic securities markets in over 30 countries through
established depository and custodial relationships. Clearstream, Luxembourg is
registered as a bank in Luxembourg, and as such is subject to regulation by the
Commission de Surveillance du Secteur Financier, "CSSF," which supervises
Luxembourg banks. Clearstream, Luxembourg's customers are world-wide financial
institutions including underwriters, securities brokers and dealers, banks,
trust companies and clearing corporations. Clearstream, Luxembourg's U.S.
customers are limited to securities brokers and dealers, and banks. Currently,
Clearstream, Luxembourg has approximately 2,000 customers located in over 80
countries, including all major European countries, Canada, and the United
States. Indirect access to Clearstream, Luxembourg is available to other
institutions that clear through or maintain a custodial relationship with an
account holder of Clearstream, Luxembourg. Clearstream, Luxembourg has
established an electronic bridge with Morgan Guaranty Trust Company of New York
as the Operator of the Euroclear System (MGT/EOC) in Brussels to facilitate
settlement of trades between Clearstream, Luxembourg and MGT/EOC.

         Euroclear was created in 1968 to hold securities for participants of
Euroclear ("Euroclear Participants") and to clear and settle transactions
between Euroclear Participants through simultaneous electronic book-entry
delivery against payment, thereby eliminating the need for physical movement of
certificates and any risk from lack of simultaneous transfers of securities and
cash. Transactions may now be settled in any of 32 currencies, including United
States dollars. Euroclear includes various other services, including securities
lending and borrowing and interfaces with domestic markets in several countries
generally similar to the arrangements for cross-market transfers with DTC
described above. Euroclear is operated by the Brussels, Belgium office of Morgan
Guaranty Trust Company of New York (the "Euroclear Operator"), under contract
with Euroclear Clearance Systems S.C., a Belgian cooperative corporation (the
"Cooperative"). All operations are conducted by the Euroclear Operator, and all
Euroclear securities clearance accounts and Euroclear cash accounts are accounts
with the Euroclear Operator, not the Cooperative. The Cooperative establishes
policy for Euroclear on behalf of Euroclear Participants. Euroclear Participants
include banks (including central banks), securities brokers and dealers and
other professional financial intermediaries. Indirect access to Euroclear is
also available to other firms that clear through or maintain a custodial
relationship with a Euroclear Participant, either directly or indirectly.

         The Euroclear Operator is the Belgian branch of a New York banking
corporation which is a member bank of the Federal Reserve System. As such, it is
regulated and examined by the Board of Governors of the Federal Reserve System
and the New York State Banking Department, as well as the Belgian Banking
Commission.

                                      S-43


         Securities clearance accounts and cash accounts with the Euroclear
Operator are governed by the Terms and Conditions Governing Use of Euroclear and
the related Operating Procedures of the Euroclear System and applicable Belgian
law (collectively, the "Terms and Conditions"). The Terms and Conditions govern
transfers of securities and cash within Euroclear, withdrawals of securities and
cash from Euroclear, and receipts of payments with respect to securities in
Euroclear. All securities in Euroclear are held on a fungible basis without
attribution of specific certificates to specific securities clearance accounts.
The Euroclear Operator acts under the Terms and Conditions only on behalf of
Euroclear Participants, and has no record of or relationship with persons
holding through Euroclear Participants.

         Distributions on the book-entry certificates will be made on each
distribution date by the trustee to DTC. DTC will be responsible for crediting
the amount of such payments to the accounts of the applicable DTC participants
in accordance with DTC's normal procedures. Each DTC participant will be
responsible for disbursing such payments to the beneficial owners of the
book-entry certificates that it represents and to each Financial Intermediary
for which it acts as agent. Each such Financial Intermediary will be responsible
for disbursing funds to the beneficial owners of the book-entry certificates
that it represents.

         Under a book-entry format, beneficial owners of the book-entry
certificates may experience some delay in their receipt of payments, since such
payments will be forwarded by the Trustee to Cede & Co. Distributions with
respect to Certificates held through Clearstream, Luxembourg or Euroclear will
be credited to the cash accounts of Clearstream, Luxembourg Participants or
Euroclear Participants in accordance with the relevant system's rules and
procedures, to the extent received by the Relevant Depositary. Such
distributions will be subject to tax reporting in accordance with relevant
United States tax laws and regulations. See "Material Federal Income Tax
Consequences--Foreign Investors" and "--Backup Withholding" in this prospectus
supplement. Because DTC can only act on behalf of Financial Intermediaries, the
ability of a beneficial owner to pledge book-entry certificates to persons or
entities that do not participate in the depository system, or otherwise take
actions in respect of such book-entry certificates, may be limited due to the
lack of physical certificates for such book-entry certificates. In addition,
issuance of the book-entry certificates in book-entry form may reduce the
liquidity of such Certificates in the secondary market since certain potential
investors may be unwilling to purchase Certificates for which they cannot obtain
definitive certificates.

         Monthly and annual reports on the trust fund provided by the master
servicer to Cede & Co., as nominee of DTC, may be made available to beneficial
owners upon request, in accordance with the rules, regulations and procedures
creating and affecting DTC or the Relevant Depositary, and to the Financial
Intermediaries to whose DTC accounts the book-entry certificates of such
beneficial owners are credited.

         DTC has advised the transferor and the trustee that, unless and until
definitive certificates are issued, DTC will take any action permitted to be
taken by the holders of the book-entry certificates under the pooling and
servicing agreement only at the direction of one or more Financial
Intermediaries to whose DTC accounts the book-entry certificates are credited,
to the extent that such actions are taken on behalf of Financial Intermediaries
whose holdings include such book-entry certificates. Clearstream, Luxembourg or
the Euroclear Operator, as the case

                                      S-44


may be, will take any other action permitted to be taken by a Certificateholder
under the pooling and servicing agreement on behalf of a Clearstream, Luxembourg
Participant or Euroclear Participant only in accordance with its relevant rules
and procedures and subject to the ability of the Relevant Depositary to effect
such actions on its behalf through DTC. DTC may take actions, at the direction
of the related Participants, with respect to some Certificates which conflict
with actions taken with respect to other Certificates.

         Definitive certificates will be issued to beneficial owners of the
book-entry certificates, or their nominees, rather than to DTC, only if

         o    DTC or the transferor advises the trustee in writing that DTC is
              no longer willing, qualified or able to discharge properly its
              responsibilities as nominee and depositary with respect to the
              book-entry certificates and the transferor or the trustee is
              unable to locate a qualified successor,

         o    the transferor, at its sole option, elects to terminate a
              book-entry system through DTC or

         o    after the occurrence of an Event of Servicing Termination (as
              defined in this prospectus supplement), beneficial owners having
              Percentage Interests aggregating not less than 51% of the
              Certificate Principal Balance of the book-entry certificates
              advise the trustee and DTC through the Financial Intermediaries
              and the DTC 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 beneficial owners.

         Upon the occurrence of any of the events described in the immediately
preceding paragraph, the trustee will be required to notify all beneficial
owners of the occurrence of such event and the availability through DTC of
definitive certificates. Upon surrender by DTC of the global certificate or
certificates representing the book-entry certificates and instructions for
re-registration, the trustee will issue definitive certificates, and thereafter
the trustee will recognize the holders of such definitive certificates as
Certificateholders under the pooling and servicing agreement.

         Although DTC, Clearstream, Luxembourg and Euroclear have agreed to the
foregoing procedures in order to facilitate transfers of Certificates among
participants of DTC, Clearstream, Luxembourg and Euroclear, they are under no
obligation to perform or continue to perform such procedures and such procedures
may be discontinued at any time.

         According to DTC, the foregoing information with respect to DTC has
been provided to the Industry for informational purposes only and is not
intended to serve as a representation, warranty, or contract modification of any
kind.

ASSIGNMENT OF MORTGAGE LOANS

         At the time of issuance of the Certificates, the depositor will
transfer to the trust fund [the amounts to be deposited into the additional loan
accounts and] all of its interest in each mortgage loan acquired on the closing
date (including any Additional Balances arising in the future),

                                      S-45


related credit line agreements, mortgages and certain other related documents
(collectively, the "Related Documents"), including all collections received on
each such mortgage loan after the cut-off date (exclusive of payments in respect
of accrued interest due on or before the cut-off date). The trustee,
concurrently with such transfer, will deliver the Certificates to the depositor
and the Transferor Certificate (as defined in the pooling and servicing
agreement) to the transferor. [Subsequent closings may occur for the purchase of
Additional Home Equity Loans on dates specified by the depositor through [ ],
200[ ]. On those closing dates the depositor will transfer to the trust fund all
of its interest in the Additional Home Equity Loans being acquired by the trust
fund that day, the Related Documents and all collections received on the
Additional Home Equity Loans after a date designated in connection with the
transfer.] Each mortgage loan transferred to the trust fund will be identified
on a mortgage loan schedule delivered to the trustee pursuant to the pooling and
servicing agreement. Such schedule will include information as to the cut-off
date principal balance of each mortgage loan as well as information with respect
to the loan rate.

The pooling and servicing agreement will require that

         o    on the [initial] closing date, with respect to not less than [50]%
              of the mortgage loans transferred to the trust fund on that date;

         o    not later than [30] days after the initial closing date, with
              respect to the [remaining] mortgage loans; [and]

         o    [not later than [20] days after the relevant closing date, with
              respect to the Additional Home Equity Loans,]

[IndyMac Bank] deliver to the depositor for delivery to the trustee or, at the
depositor's direction, directly to the trustee, the mortgage notes related to
the mortgage loans endorsed in blank and the Related Documents.

         In lieu of delivery of original documentation, [IndyMac Bank] may
deliver documents that have been imaged optically upon delivery of an opinion of
counsel that such documents are enforceable to the same extent as the originals
and do not impair the enforceability of the transfer to the trust fund of the
mortgage loans, provided the retention of such documents in such format will not
result in a reduction in the then current rating of the Certificates, without
regard to the Policy [or any other third party credit enhancements].

         [In addition, with respect to any of the mortgage loans, in lieu of
transferring the related mortgage to the trustee as one of the Related
Documents, the Depositor may at its discretion provide evidence that the related
mortgage is held through the MERS(R) System. In addition, the mortgage for some
or all of the mortgage loans in the trust fund that are not already held in the
MERS(R) System may, at the discretion of the master servicer, in the future be
held through the MERS(R) System. For any mortgage held through the MERS(R)
System, the mortgage is recorded in the name of the Mortgage Electronic
Registration System, Inc. or MERS, as nominee for the owner of the mortgage
loan, and subsequent assignments of the mortgage were, or in the future may be,
at the discretion of the master servicer, registered electronically through the
MERS(R) System. For each of these mortgage loans, MERS serves as a mortgagee of
record on the

                                      S-46


mortgage solely as a nominee in an administrative capacity on behalf of the
trustee, and does not have any interest in that mortgage loan.]

         Within 90 days of the closing date with respect to the mortgage loans
acquired on the closing date [and within 90 days of the relevant closing date
with respect to Additional Home Equity Loans], the trustee will review the
mortgage loans and the Related Documents and if any mortgage loan or Related
Document is found to be defective in any material respect and such defect is not
cured within 90 days following notification thereof to the seller and the
depositor by the trustee, the seller will be obligated to accept the transfer of
such mortgage loan from the trust fund. Upon such transfer, the principal
balance of such mortgage loan will be deducted from the applicable loan group
balance, thus reducing the amount of the Transferor Interest. If the deduction
would cause the portion of the Transferor Interest related to that loan group to
become less than the related Minimum Transferor Interest at such time (a
"Transfer Deficiency"), the seller will be obligated to either substitute an
Eligible Substitute mortgage loan and/or make a deposit into the Collection
Account in the amount (the "Transfer Deposit Amount") equal to the amount by
which the portion of the Transferor Interest related to that loan group would be
reduced to less than the related Minimum Transferor Interest at such time. Any
such deduction, substitution or deposit, will be treated under the pooling and
servicing agreement as a payment in full of such mortgage loan. Any Transfer
Deposit Amount will be treated as a principal collection on the related loan
group. Notwithstanding the foregoing, however, no such transfer shall be
considered to have occurred unless and until all required deposits to the
Collection Account are actually made. The obligation of the seller to accept a
transfer of a Defective Mortgage Loan and to make any required deposits are the
sole remedies regarding any defects in the mortgage loans and Related Documents
available to the trustee or the Certificateholders.

         An "Eligible Substitute Mortgage Loan" is a mortgage loan substituted
by the seller for a defective mortgage loan which must, on the date of such
substitution,

         o    have an outstanding principal balance (or in the case of a
              substitution of more than one mortgage loan for a Defective
              Mortgage Loan, an aggregate principal balance) that is not [10]%
              more or less than the Transfer Deficiency relating to such
              Defective Mortgage Loan;

         o    have a loan rate not less than the loan rate of the Defective
              Mortgage Loan and not more than [1]% in excess of the loan rate of
              such Defective Mortgage Loan;

         o    have a loan rate based on the same Index with adjustments to such
              loan rate made on the same Interest Rate Adjustment Date as that
              of the Defective Mortgage Loan;

         o    have a margin that is not less than the margin of the Defective
              Mortgage Loan and not more than [100] basis points higher than the
              margin for the Defective Mortgage Loan;

         o    have a mortgage of the same or higher level of priority as the
              mortgage relating to the Defective Mortgage Loan;

                                      S-47



         o    have a remaining term to maturity not more than [six] months
              earlier and not more than [60] months later than the remaining
              term to maturity of the Defective Mortgage Loan;

         o    comply with each representation and warranty as to the mortgage
              loans set forth in the pooling and servicing agreement (deemed to
              be made as of the date of substitution);

         o    in general, have an original combined loan-to-value ratio not
              greater than that of the Defective Mortgage Loan; and

         o    satisfy certain other conditions specified in the pooling and
              servicing agreement.

To the extent the principal balance of an Eligible Substitute Mortgage Loan is
less than the principal balance of the related Defective Mortgage Loan and to
the extent that the Transferor Interest would be reduced below the Minimum
Transferor Interest, the seller will be required to make a deposit to the
Collection Account equal to such difference.

         The seller will make certain representations and warranties as to the
accuracy in all material respects of certain information furnished to the
trustee with respect to each mortgage loan (e.g., cut-off date principal balance
and loan rate). In addition, the seller will represent and warrant on the
closing date that at the time of transfer to the depositor, the seller has
transferred or assigned all of its interest in each mortgage loan and the
Related Documents, free of any lien[, and likewise represent and warrant on each
relevant closing date with respect to each Additional Home Equity Loan] (subject
to certain exceptions). Upon discovery of a breach of any such representation
and warranty which materially and adversely affects the interests of the
Certificateholders, the Certificate Insurer [or any other third party credit
enhancer] in the related mortgage loan and Related Documents, the seller will
have a period of 90 days after discovery or notice of the breach to effect a
cure. If the breach cannot be cured within the 90-day period, the seller will be
obligated to accept a transfer of the Defective Mortgage Loan from the trust
fund. The same procedure and limitations that are set forth in the second
preceding paragraph for the transfer of Defective Mortgage Loans will apply to
the transfer of a mortgage loan that is required to be transferred because of
such breach of a representation or warranty in the pooling and servicing
agreement that materially and adversely affects the interests of the
Certificateholders.

         Mortgage loans required to be transferred to the seller as described in
the preceding paragraphs are referred to as "Defective Mortgage Loans."

         Pursuant to the pooling and servicing agreement, the master servicer
will service and administer the mortgage loans as more fully set forth above.

AMENDMENTS TO CREDIT LINE AGREEMENTS

         Subject to applicable law and to certain limitations described in the
pooling and servicing agreement, the master servicer may change the terms of the
credit line agreements at any time provided that such changes

                                      S-48


         o    do not adversely affect the interest of the Certificateholders,
              the Certificate Insurer [or any other third party credit
              enhancer], and

         o    are consistent with prudent business practice.

In addition, the pooling and servicing agreement permits the master servicer,
within certain limitations described therein, to increase the credit limit of
the related mortgage loan or reduce the margin for such mortgage loan.

OPTIONAL TRANSFERS OF MORTGAGE LOANS TO THE TRANSFEROR

         In order to permit the transferor to remove mortgage loans from
[either] loan group at such times, if any, as the portion of the Transferor
Interest related to that loan group exceeds the level required by the
Certificate Insurer[, any other third party credit enhancer] and the Rating
Agencies, on any distribution date the transferor may, but shall not be
obligated to, remove on such distribution date (the "Transfer Date") from the
loan group, certain mortgage loans without notice to the Certificateholders. The
transferor is permitted to designate the mortgage loans to be removed. Mortgage
loans so designated will only be removed upon satisfaction of the following
conditions:

         o    no Rapid Amortization Event (as defined in this prospectus
              supplement) has occurred;

         o    the portion of the Transferor Interest allocable to that loan
              group as of such Transfer Date (after giving effect to such
              removal) exceeds the Minimum Transferor Interest;

         o    the transfer of any mortgage loans from [either] loan group on any
              Transfer Date during the Managed Amortization Period (as defined
              in this prospectus supplement) shall not, in the reasonable belief
              of the transferor, cause a Rapid Amortization Event or an event
              which with notice or lapse of time or both would constitute a
              Rapid Amortization Event to occur;

         o    the transferor shall have delivered to the trustee a "Mortgage
              Loan Schedule" containing a list of all mortgage loans remaining
              in the related loan group after such removal;

         o    the transferor shall represent and warrant that no selection
              procedures which the transferor reasonably believes are adverse to
              the interests of the Certificateholders, the Certificate Insurer
              [or any other third party credit enhancer] were used by the
              transferor in selecting such mortgage loans;

         o    in connection with each such retransfer of mortgage loans, the
              Rating Agencies and the Certificate Insurer shall have been
              notified of the proposed transfer and prior to the Transfer Date
              no Rating Agency has notified the transferor or the Certificate
              Insurer in writing that such transfer would result in a reduction
              or withdrawal of the ratings assigned to either Class of
              Certificates without regard to the Policy [or any other third
              party credit enhancement]; and

                                      S-49


         o    the Transferor shall have delivered to the Trustee and the
              Certificate Insurer an officer's certificate confirming the [six]
              conditions preceding this one.

As of any date of determination within any Collection Period, the "Minimum
Transferor Interest" for either loan group is an amount equal to [the lesser of
(a) [5]% of the related loan group balance at the end of the immediately
preceding Collection Period and (b) the Transferor Interest as of the closing
date].

PAYMENTS ON MORTGAGE LOANS; DEPOSITS TO COLLECTION ACCOUNT

         The trustee shall establish and maintain on behalf of the master
servicer an account (the "Collection Account") in trust for the
Certificateholders, the Transferor, the Certificate Insurer [and any other third
party credit enhancer], as their interests may appear. The Collection Account
will be an Eligible Account (as defined in this prospectus supplement). Subject
to the investment provision described in the following paragraphs, within two
business days of receipt by the master servicer of amounts in respect of the
mortgage loans (excluding amounts representing administrative charges, annual
fees, taxes, assessments, credit insurance charges, insurance proceeds to be
applied to the restoration or repair of a mortgaged property or similar items),
the master servicer will deposit such amounts in the Collection Account.

         Amounts so deposited may be invested in Eligible Investments (as
described in this prospectus supplement) maturing no later than one business day
prior to the next distribution date or on such distribution date if approved by
the Rating Agencies, the Certificate Insurer [and any other third party credit
enhancer]. Not later than the [third] business day prior to each distribution
date (the "Determination Date"), the master servicer will notify the trustee of
the amount of such deposit to be included in funds available for the related
distribution date.

         An "Eligible Account" is

         o    an account that is maintained with a depository institution whose
              debt obligations throughout the time of any deposit therein have
              the highest short-term debt rating by the Rating Agencies,

         o    a segregated trust account maintained with the trustee or an
              affiliate of the trustee in its fiduciary capacity or

         o    otherwise acceptable to each Rating Agency and the Certificate
              Insurer as evidenced by a letter from each Rating Agency and the
              Certificate Insurer to the trustee, without reduction or
              withdrawal of each Rating Agency's then current ratings of the
              Certificates without regard to the Policy [or any other third
              party credit enhancement).

         Eligible Investments are specified in the pooling and servicing
agreement and are limited to

         o    obligations of the United States or any agency thereof, provided
              the timely payment of such obligations are backed by the full
              faith and credit of the United States;

                                      S-50


         o    general obligations of or obligations guaranteed by any state of
              the United States or the District of Columbia receiving the
              highest long-term debt rating of each Rating Agency, or such tower
              rating as will not result in the downgrading or withdrawal of the
              ratings then assigned to the Certificates by each Rating Agency
              without regard to the Policy [or any other third party credit
              enhancement];

         o    commercial paper issued by [IndyMac Bank, F.S.B.] or any of its
              affiliates; provided that such commercial paper is rated no tower
              than ["A-I" by Standard & Poor's and "P-2" by Moody's] and the
              long-term debt of [IndyMac Bank, F.S.B.] is rated at least [A3 by
              Moody's], or such lower ratings as will not result in the
              downgrading or withdrawal of the rating then assigned to the
              Certificates by any Rating Agency without regard to the Policy [or
              any other third party credit enhancement];

         o    commercial or finance company paper which is then receiving the
              highest commercial or finance company paper rating of each Rating
              Agency, or such lower rating as will not result in the downgrading
              or withdrawal of the ratings then assigned to the Certificates by
              any Rating Agency without regard to the Policy [or any other third
              party credit enhancement];

         o    certificates of deposit, demand or time deposits, or bankers'
              acceptances issued by any depository institution or trust company
              incorporated under the laws of the United States or of any state
              thereof and subject to supervision and examination by federal
              and/or state banking authorities, provided that the commercial
              paper and/or long-term unsecured debt obligations of such
              depository institution or trust company (or in the case of the
              principal depository institution in a holding company system, the
              commercial paper or long-term unsecured debt obligations of such
              holding company, but only if Moody's is not a Rating Agency) are
              then rated one of the two highest long-term and the highest
              short-term ratings of each Rating Agency for such securities, or
              such lower ratings as will not result in the downgrading or
              withdrawal of the rating then assigned to the Certificates by any
              Rating Agency without regard to the Policy [or any other third
              party credit enhancement];

         o    demand or time deposits or certificates of deposit issued by any
              bank or trust company or savings institution to the extent that
              such deposits are fully insured by the FDIC;

         o    guaranteed reinvestment agreements issued by any bank, insurance
              company or other corporation containing, at the time of the
              issuance of such agreements, such terms and conditions as will not
              result in the downgrading or withdrawal of the rating then
              assigned to the Certificates by any Rating Agency without regard
              to the Policy [or any other third party credit enhancement];

         o    repurchase obligations with respect to any security described in
              the first and second bullet points, in either case entered into
              with a depository institution or trust company (acting as
              principal) described in the fifth bullet point;

                                      S-51


         o    securities (other than stripped bonds, stripped coupons or
              instruments sold at a purchase price in excess of 115% of the face
              amount thereof) bearing interest or sold at a discount issued by
              any corporation incorporated under the laws of the United States
              or any state thereof which, at the time of such investment, have
              one of the two highest ratings of each Rating Agency (except if
              the Rating Agency is Moody's, such rating shall be the highest
              commercial paper rating of Moody's for any such securities), or
              such lower rating as will not result in the downgrading or
              withdrawal of the rating then assigned to the Certificates by any
              Rating Agency without regard to the Policy [or any other third
              party credit enhancement], as evidenced by a signed writing
              delivered by each Rating Agency;

         o    interests in any money market fund which at the date of
              acquisition of the interests in such fund and throughout the time
              such interests are held in such fund has the highest applicable
              rating by each Rating Agency or such lower rating as will not
              result in the downgrading or withdrawal of the ratings then
              assigned to the Certificates by each Rating Agency without regard
              to the Policy [or any other third party credit enhancement];

         o    short term investment funds sellered by any trust company or
              national banking association incorporated under the laws of the
              United States or any state thereof which on the date of
              acquisition has been rated by each Rating Agency in their
              respective highest applicable rating category or such lower rating
              as will not result in the downgrading or withdrawal of the ratings
              then assigned to the Certificates by each Rating Agency without
              regard to the Policy [or any other third party credit
              enhancement]; and

         o    such other investments having a specified stated maturity and
              bearing interest or sold at a discount acceptable to each Rating
              Agency as will not result in the downgrading or withdrawal of the
              rating then assigned to the Certificates by any Rating Agency
              without regard to the Policy [or any other third party credit
              enhancement], as evidenced by a signed writing delivered by each
              Rating Agency;

         provided that no such instrument shall be an Eligible Investment if
such instrument evidences the right to receive

         o    interest only payments with respect to the obligations underlying
              such instrument or

         o    both principal and interest payments derived from obligations
              underlying such instrument and the interest and principal payments
              with respect to such instrument provide a yield to maturity at par
              greater than 120% of the yield to maturity at par of the
              underlying obligations;

and provided, further, that no instrument described hereunder may be purchased
at a price greater than par if such instrument may be prepaid or called at a
price less than its purchase price prior to its stated maturity.

                                      S-52


ALLOCATIONS AND COLLECTIONS

         All collections on the mortgage loans will generally be allocated in
accordance with the credit line agreements between amounts collected in respect
of interest and amounts collected in respect of principal. As to any
distribution date, "Interest Collections" will be determined on a loan group
basis and will be equal to the amounts collected during the related Collection
Period (as defined in this prospectus supplement), including without limitation
such portion of Net Liquidation Proceeds, allocated to interest pursuant to the
terms of the credit line agreements less

         o    servicing fees for the related Collection Period and

         o    amounts payable to the master servicer pursuant to the pooling and
              servicing agreement as reimbursement of optional advances of the
              interest component of any delinquent monthly payments on the
              mortgage loans.

         As to any distribution date, "Principal Collections" will be determined
on a loan group basis and will be equal to the sum of

         o    the amounts collected during the related Collection Period,
              including without limitation such portion of Net Liquidation
              Proceeds, allocated to principal pursuant to the terms of the
              credit line agreements and

         o    any Transfer Deposit Amounts.

         "Net Liquidation Proceeds" with respect to a mortgage loan are equal to
the liquidation proceeds, reduced by related expenses, but not including the
portion, if any, of such amount that exceeds the principal balance of the
mortgage loan plus accrued and unpaid interest thereon to the end of the
Collection Period during which such mortgage loan became a Liquidated Mortgage
Loan. "Liquidation Proceeds" are the proceeds (excluding any amounts drawn on
the Policy) received in connection with the liquidation of any mortgage loan,
whether through trustee's sale, foreclosure sale or otherwise.

         With respect to any distribution date and loan group, the portion of
interest collections allocable to the related Class of Certificates ("Investor
Interest Collections") will equal the product of (a) Interest Collections for
such distribution date and loan group and (b) the Investor Floating Allocation
Percentage for such loan group. With respect to any distribution date and loan
group, the "Investor Floating Allocation Percentage" is the percentage
equivalent of a fraction determined by dividing the Invested Amount at the close
of business on the preceding distribution date (or the closing date in the case
of the first distribution date) by the loan group balance for such loan group at
the beginning of the related Collection Period. The remaining amount of interest
collections will be allocated to the portion of the Transferor Interest related
to that loan group.

         With respect to the mortgage loans in each loan group, principal
collections will be allocated between the Certificateholders and the transferor
("Investor Principal Collections" and "Transferor Principal Collections,"
respectively) as described in this prospectus supplement.

                                      S-53


         The trustee will apply any amounts drawn under the Policy as provided
in the pooling and servicing agreement.

         With respect to any date and loan group, the "loan group balance" will
be equal to the aggregate of the principal balances of all mortgage loans in
that loan group as of such date. The principal balance of a mortgage loan (other
than a Liquidated Mortgage Loan) on any day is equal to its cut-off date
principal balance, plus (1) any Additional Balances in respect of such mortgage
loan minus (2) all collections credited against the principal balance of such
mortgage loan in accordance with the related credit line agreement prior to such
day. The principal balance of a Liquidated Mortgage Loan after final recovery of
related liquidation proceeds shall be zero.

DISTRIBUTIONS ON THE CERTIFICATES

         Beginning with the first distribution date (which will occur on [ ]),
distributions on the Certificates will be made by the trustee or the Paying
Agent on each distribution date to the persons in whose names such Certificates
are registered at the close of business on the day prior to each distribution
date or, if the Certificates are no longer book-entry certificates, at the close
of business on the record date (which is the [last] day of the month preceding
such distribution date). The term "distribution date" means the [fifteenth] day
of each month or, if such day is not a business day, then the first business day
thereafter. Distributions on the Class [ ] Certificates will be made by check or
money order mailed (or upon the request of a Certificateholder owning
Certificates having denominations aggregating at least $[1,000,000], by wire
transfer or as otherwise agreed by such Certificateholder and the trustee) to
the address of the person entitled thereto (which, in the case of book-entry
certificates, will be DTC or its nominee) as it appears on the certificate
register in amounts calculated as described in this prospectus supplement on the
Determination Date. However, the final distribution in respect of the
Certificates will be made only upon presentation and surrender thereof at the
office or the agency of the trustee specified in the notice to
Certificateholders of such final distribution. For purposes of the pooling and
servicing agreement, a "business day" is any day other than (1) a Saturday or
Sunday or (2) a day on which banking institutions in the states of New York or
California are required or authorized by law to be closed.

         Application of Interest Collections. On each distribution date, the
trustee or the Paying Agent will apply the Investor Interest Collections for
loan group [ ] in the following manner and order of priority:

         (1)  as payment to the trustee for the related fee for services
              rendered pursuant to the pooling and servicing agreement;

         (2)  as payment to the Certificate Insurer for the portion of the
              premium for the Policy related to loan group [ ];

         (3)  as payment to Certificateholders for the interest accrued at the
              related certificate rate and any overdue accrued interest (with
              interest thereon to the extent permitted by applicable law) on the
              Certificate Principal Balance of the Certificates;

         (4)  to pay to Certificateholders the related Investor Loss Amount for
              such distribution date;

                                      S-54


         (5)  as payment to Certificateholders for any related Investor Loss
              Amount for a previous distribution date that was not previously
              (a) funded by related Investor Interest Collections, (b) absorbed
              by a reduction in the related portion of the Transferor Interest,
              (c) funded by related Subordinated Transferor Collections as
              described below[, (d) previously funded by the Reserve Fund, (e)
              previously funded pursuant to clause (9) below] or (f) funded by
              draws on the Policy;

         (6)  to reimburse the Certificate Insurer for prior draws made from the
              Policy (with interest thereon);

         (7)  to pay to Certificateholders principal on the Certificates until
              the related portion of the Transferor Interest equals the related
              Required Transferor Subordinated Amount (such amount so paid, the
              "Accelerated Principal Distribution Amount");

         (8)  in respect of any other amounts owed to the Certificate Insurer
              pursuant to the Insurance Agreement;

         (9)  [to pay to the other Class of Certificates any deficiency in items
              (3), (4) and (5) above, after taking into account the allocation
              of 100% of such other Class' Investor Interest Collections
              relating to such other Class on such distribution date (the amount
              of one Class' remaining Investor Interest Collections which is
              allocated with respect to the other Class on such distribution
              date is a "Crossover Amount");]

         (10) [to the Reserve Fund for application in accordance with the
              pooling and servicing agreement, to the extent that the sum of the
              portion of the Transferor Interest for [both] loan groups as of
              such distribution date is less than the sum of the Required
              Transferor Subordinated Amounts for [both] loan groups as of such
              distribution date;]

         (11) as payment to the master servicer for certain amounts that may be
              required to be paid to the master servicer pursuant to the pooling
              and servicing agreement;

         (12) [to pay to the Certificateholders any Basis Risk Carryforward with
              respect to such Certificates;] and

         (13) to pay to the transferor to the extent permitted as described in
              this prospectus supplement.

         Payments to Certificateholders pursuant to clause (3) will be interest
payments on the Certificates. Payments to Certificateholders pursuant to clauses
(4), (5) and (7) will be principal payments on the Certificates and will
therefore reduce the related Certificate Principal Balance; however, payments
pursuant to clause (7) will not reduce the related Invested Amount. The
Accelerated Principal Distribution Amount for a Class is not guaranteed by the
Policy.

         [On each distribution date, if Investor Interest Collections with
respect to a Class of Certificates, plus any Crossover Amount available from the
other Class of Certificates, are insufficient to pay the amounts specified in
items (3), (4) and (5) above with respect to a Class of Certificates, the amount
of such insufficiency shall be withdrawn from the Reserve Fund to the extent of
funds on deposit therein.]

                                      S-55


         [The amount on deposit in the Reserve Fund will not exceed the excess
of (x) the sum of the Required Transferor Subordinated Amounts with respect to
[both] loan groups over (y) the sum of the portion of the Transferor Interest
with respect to each loan group. Amounts in the Reserve Fund may only be
withdrawn therefrom and applied in accordance with the terms of the pooling and
servicing agreement.]

         To the extent that Investor Interest Collections from a loan group are
applied to pay the interest on the related Class of Certificates, Investor
Interest Collections for that loan group may be insufficient to cover related
Investor Loss Amounts. If such insufficiency exists after the related Available
Transferor Subordinated Amount[, the Crossover Amount and the Reserve Fund]
[have each been] [has] reduced to zero and results in the related Certificate
Principal Balance exceeding the related Invested Amount, a draw will be made on
the Policy in accordance with the terms of the Policy.

         The "Investor Loss Amount" for a loan group is the product of the
Investor Floating Allocation Percentage for that loan group and the Liquidation
Loss Amount for that loan group for such distribution date.

         "Liquidation Loss Amount" means with respect to any Liquidated Mortgage
Loan, the unrecovered principal balance thereof at the end of the Collection
Period in which such mortgage loan became a Liquidated Mortgage Loan, after
giving effect to the Net Liquidation Proceeds in connection therewith.

         A "Liquidated Mortgage Loan" means, as to any distribution date, any
mortgage loan in respect of which the master servicer has determined, based on
the servicing procedures specified in the pooling and servicing agreement, as of
the end of the preceding Collection Period, that all Liquidation Proceeds which
it expects to recover with respect to the disposition of the mortgage loan or
the related mortgaged property have been recovered. The Investor Loss Amount for
a loan group will be allocated to the Certificates related to that loan group.

         As to any distribution date, the "Collection Period" is the calendar
month preceding each distribution date (or, in the case of the first Collection
Period, the period beginning after the cut-off date and ending on the last day
of [ ], 200[ ]).

         Interest will be distributed on each distribution date at the
applicable certificate rate for the related Interest Period (as defined below).
The "certificate rate" for the Class [ ] Certificates for a distribution date
will generally equal a per annum rate equal to [the least of:]

         (a) the sum of

              o    the London Interbank offered rate for one-month [Eurodollar]
                   deposits ("LIBOR"), calculated as specified below, as of the
                   second LIBOR Business Day prior to the immediately preceding
                   distribution date (or as of two LIBOR Business Days prior to
                   the closing date, in the case of the first distribution date)
                   plus

              o    [ ]%

                                      S-56


         (b) a per annum rate equal to the weighted average of the loan rates of
the mortgage loans in loan group [ ] (weighted on the basis of the daily average
balance of each mortgage loan included in loan group [ ], during the related
billing cycle prior to the Collection Period relating to such distribution date)
net of

              o    the Servicing Fee Rate,

              o    the rate at which the fee payable to the trustee is
                   calculated,

              o    the rate at which the premium payable to the Certificate
                   Insurer is calculated [and,

         (c) [      ]%.]

[However, on any distribution date for which the certificate rate for a Class of
Certificates has been determined pursuant to clause (b) of the preceding
sentence, the excess of

              o    the amount of interest that would have accrued on those
                   certificates during the related Interest Period had such
                   amount been determined pursuant to clause (a) of the
                   definition of the preceding sentence (but not at a rate in
                   excess of [ ]% per annum) over

              o    the interest actually accrued on those certificates during
                   such Interest Period (such excess is referred to as "Basis
                   Risk Carryforward")

will accrue interest at the certificate rate calculated pursuant to clause (a),
[but not to exceed clause (c)] (as adjusted from time to time) and will be paid
on subsequent distribution dates to the extent funds are available therefor.]

         Interest on the Certificates in respect of any distribution date will
accrue on the Certificate Principal Balance from the preceding distribution date
(or in the case of the first distribution date, from the closing date) through
the day preceding such distribution date (each such period, an "Interest
Period") on the basis of the actual number of days in the Interest Period and a
360-day year. Interest payments on the Certificates will be funded from Investor
Interest Collections, Subordinated Transferor Collections, [the Reserve Fund,]
and, if necessary, from draws on the Policy.

         Calculation of the LIBOR Rate. On the second LIBOR business day
immediately preceding each distribution date, the trustee shall determine LIBOR
for the Interest Period commencing on such distribution date. LIBOR for the
first Interest Period will be determined on the second LIBOR business day
preceding the closing date. LIBOR will equal the rate for United States dollar
deposits for one month which appears on the Telerate Screen Page 3750 as of
11:00 A.M., London time, on the second LIBOR business day prior to the first day
of such Interest Period. "Telerate Screen Page 3750" means the display
designated as page 3750 on the Moneyline Telerate Service (or such other page as
may replace page 3750 on that service for the purpose of displaying London
interbank offered rates of major banks). If such rate does not appear on such
page (or such other page as may replace that page on that service, or if such
service is no longer offered, such other service for displaying LIBOR or
comparable rates as may

                                      S-57


be selected by the depositor after consultation with the trustee), the rate will
be the Reference Bank Rate. The "Reference Bank Rate" will be determined on the
basis of the rates at which deposits in United States dollars are offered by the
reference banks (which shall be three major banks that are engaged in
transactions in the London interbank market, selected by the depositor after
consultation with the trustee) as of 11:00 A.M., London time, on the day that is
two LIBOR business days prior to the immediately preceding distribution date to
prime banks in the London interbank market for a period of one month in amounts
approximately equal to the principal amount of the Certificates then
outstanding. The trustee will request the principal London office of each of the
reference banks to provide a quotation of its rate. If at least two such
quotations are provided, the rate will be the arithmetic mean of the quotations.
If on such date fewer than two quotations are provided as requested, the rate
will be the arithmetic mean of the rates quoted by one or more major banks in
New York City, selected by the depositor after consultation with the trustee, as
of 11:00 A.M., New York City time, on such date for loans in United States
dollars to leading European banks for a period of one month in amounts
approximately equal to the principal amount of the Certificates then
outstanding. If no such quotations can be obtained, the rate will be LIBOR for
the preceding Interest Period. "LIBOR business day" means any day other than (a)
a Saturday or a Sunday or (b) a day on which banking institutions in the State
of New York or in the city of London, England are required or authorized by law
to be closed.

         Transferor Collections. Collections allocable to the Transferor
Interest in respect of a loan group will be distributed to the transferor only
to the extent that such distribution will not reduce the amount of the portion
of the Transferor Interest relating to that loan group as of the related
distribution date below the applicable Minimum Transferor Interest. Amounts not
distributed to the transferor because of such limitations will be retained in
the Collection Account until the portion of the Transferor Interest relating to
each loan group exceeds the applicable Minimum Transferor Interest, at which
time such excess shall be released to the transferor. If any such amounts are
still retained in the Collection Account upon the commencement of the Rapid
Amortization Period, such amounts will be paid to the Certificateholders of the
related Class of Certificates as a reduction of the related Certificate
Principal Balance.

         Distributions of Principal Collections. For each loan group, the period
beginning on the closing date and, unless a Rapid Amortization Event shall have
earlier occurred, through and including the distribution date in [     ] (the
"Managed Amortization Period"), the amount of principal collections payable to
Certificateholders as of each distribution date during the Managed Amortization
Period will equal, to the extent funds are available therefor, the Scheduled
Principal Collections Distribution Amount for such loan group and distribution
date. On any distribution date during the Managed Amortization Period, the
"Scheduled Principal Collections Distribution Amount" for a loan group shall
equal the lesser of the applicable Maximum Principal Payment and the applicable
Alternative Principal Payment. With respect to any loan group and distribution
date, the "Maximum Principal Payment" will equal the product of the Investor
Fixed Allocation Percentage for that loan group and principal collections for
such loan group and distribution date. With respect to any loan group and
distribution date, the "Alternative Principal Payment" for that loan group will
equal the greater of

                                      S-58



         o    the amount (not less than zero) of Principal Collections for such
              loan group and distribution date less the aggregate of Additional
              Balances created on the mortgage loans in that loan group during
              the related Collection Period; and

         o    [ ]% of the Certificate Principal Balance immediately prior to
              such distribution date.

         Beginning with the first distribution date following the end of the
Managed Amortization Period (such period, the "Rapid Amortization Period"), the
amount of principal collections payable to Certificateholders on each
distribution date will be equal to the Maximum Principal Payment for that loan
group.

         If on any distribution date the Required Transferor Subordinated Amount
for a loan group is reduced below the then existing Available Transferor
Subordinated Amount for that loan group, the amount of principal collections
from the mortgage loans in that loan group payable to Certificateholders on such
distribution date will be correspondingly reduced by the amount of such
reduction.

         The amount of Principal Collections for a loan group to be distributed
to Certificateholders on the first distribution date will reflect Principal
Collections and Additional Balances from the mortgage loans in that loan group
during the first Collection Period which is the period beginning on the cut-off
date and ending on the last day of [       ].

         Distributions of Principal Collections from the mortgage loans in a
loan group based upon the related Investor Fixed Allocation Percentage may
result in distributions of principal to the related Certificateholders in
amounts that are greater relative to the declining balance of that loan group
than would be the case if the related Investor Floating Allocation Percentage
were used to determine the percentage of principal collections distributed in
respect of such Invested Amount. Principal Collections from the mortgage loans
in a loan group not allocated to the Certificateholders will be allocated to the
portion of the Transferor Interest related to that loan group. The aggregate
distributions of principal to the Certificateholders will not exceed the
Original Certificate Principal Balance.

         In addition, to the extent of funds available therefor (including funds
available under the Policy), on the distribution date in [ ], Certificateholders
will be entitled to receive as a payment of principal an amount equal to the
outstanding Certificate Principal Balance.

         The Paying Agent. The Paying Agent shall initially be the trustee,
together with any successor thereto in such capacity (the "Paying Agent"). The
Paying Agent shall have the revocable power to withdraw funds from the
Collection Account for the purpose of making distributions to the
Certificateholders.

LIMITED SUBORDINATION OF TRANSFEROR INTEREST

         If Investor Interest Collections[, Crossover Amounts and amounts on
deposit in the Reserve Fund] on any distribution date are insufficient to pay
(i) accrued interest due and any overdue accrued interest (with interest thereon
to the extent permitted by applicable law) on the related Certificates and (ii)
the applicable Investor Loss Amount on such distribution date (such


                                      S-59


insufficiency being the "Required Amount"), a portion of the Interest
Collections from the mortgage loans in that loan group and principal collections
allocable to the portion of the Transferor Interest related to that loan group
(but not in excess of the applicable Available Transferor Subordinated Amount)
(the "Subordinated Transferor Collections") will be applied to cover the
Required Amount for that loan group. The portion of the Required Amount for a
loan group in respect of clause (ii) above not covered by such Subordinated
Transferor Collections will be reallocated to the portion of the Transferor
Interest related to that loan group, thereby reducing the Transferor Interest
(up to the applicable remaining Available Transferor Subordinated Amount and not
in excess of the Investor Loss Amounts for that loan group). The portion of the
Required Amount not covered by the application of funds pursuant to the
provisions of the preceding sentence may then be satisfied by amounts available
from the remaining Available Transferor Subordinated Amount from the other loan
group. If such Investor Interest Collections for a loan group[, Crossover
Amounts, amounts on deposit in the Reserve Fund] and the amount of Subordinated
Transferor Collections which have been so applied to cover the applicable
Required Amount are together insufficient to pay the amounts set forth in item
(i) of the definition of Required Amount, then a draw will be made on the Policy
to cover the amount of such shortfall. In addition, if on any distribution date
on which the Available Transferor Subordinated Amount for a loan group is
reduced to zero the Certificate Principal Balance for that loan group exceeds
the applicable Invested Amount (after giving effect to all allocations and
distributions with respect to principal to be made on the Certificates on such
distribution date), a draw will be made on the Policy in the amount of such
excess for such distribution date. See "--The Policy."

         With respect to any distribution date and loan group, the "Available
Transferor Subordinated Amount" shall equal the lesser of the portion of the
Transferor Interest for that loan group and the related Required Transferor
Subordinated Amount for such distribution date.

RAPID AMORTIZATION EVENTS

         As described above, the Managed Amortization Period will continue
through and including the distribution date in [ ], unless a Rapid Amortization
Event occurs prior to such date. "Rapid Amortization Event" refers to any of the
following events:

         (a) the failure on the part of the seller

              o    to make a payment or deposit required under the pooling and
                   servicing agreement within three business days after the date
                   such payment or deposit is required to be made,

              o    to observe or perform in any material respect any other
                   covenants or agreements of the seller set forth in the
                   pooling and servicing agreement, which failure continues
                   unremedied for a period of 60 days after written notice;

         (b) any representation or warranty made by the seller in the pooling
and servicing agreement proves to have been incorrect in any material respect
when made and continues to be incorrect in any material respect for a period of
60 days after written notice and as a result of which the interests of the
Certificateholders, the Certificate Insurer [or any other third party

                                      S-60


credit enhancer] are materially and adversely affected; provided, however, that
a Rapid Amortization Event shall not be deemed to occur if the seller has
purchased or made a substitution for the related mortgage loan or mortgage loans
if applicable during such period (or within an additional 60 days with the
consent of the trustee) in accordance with the provisions of the pooling and
servicing agreement;

         (c) the occurrence of certain events of bankruptcy, insolvency or
receivership relating to the transferor;

         (d) the trust fund becomes subject to regulation by the Securities and
Exchange Commission as an investment company within the meaning of the
Investment Company Act of 1940, as amended; or

         (e) the aggregate of all draws under the Policy [or amounts paid
pursuant to third party credit enhancement for loan group [ ]] incurred during
the Managed Amortization Period exceeds [1]% of the Original Invested Amount.

         In the case of any event described in clause (a) or (b), a Rapid
Amortization Event will be deemed to have occurred only if, after the applicable
grace period, if any, described in such clauses, either the trustee or
Certificateholders holding Certificates evidencing more than 51% of the
aggregate principal amount of the Certificates, the Certificate Insurer (so long
as there is no default by the Certificate Insurer in the performance of its
obligations under the Policy) [or any other third party credit enhancer], by
written notice to the depositor and the master servicer (and to the trustee, if
given by the Certificate Insurer, [any other third party credit enhancer] or the
Certificateholders) declare that a Rapid Amortization Event has occurred as of
the date of such notice. In the case of any event described in clause (c), (d)
or (e) a Rapid Amortization Event will be deemed to have occurred without any
notice or other action on the part of the trustee, the Certificate Insurer or
the Certificateholders immediately upon the occurrence of such event.

         In addition to the consequences of a Rapid Amortization Event discussed
above, if the transferor voluntarily files a bankruptcy petition or goes into
liquidation or any person is appointed a receiver or bankruptcy trustee of the
transferor, on the day of any such filing or appointment no further Additional
Balances will be transferred to the trust fund, the transferor will immediately
cease to transfer Additional Balances to the trust fund and the transferor will
promptly give notice to the trustee of any such filing or appointment. Within 15
days, the trustee will publish a notice of the liquidation or the filing or
appointment stating that the Trustee intends to sell, dispose of or otherwise
liquidate the mortgage loans in a commercially reasonable manner and to the best
of its ability. Unless otherwise instructed within a specified period by
Certificateholders representing undivided interests aggregating more than 51% of
the aggregate principal amount of the Certificates, the trustee will sell,
dispose of or otherwise liquidate the mortgage loans in a commercially
reasonable manner and on commercially reasonable terms. Any proceeds will be
treated as collections allocable to the Certificateholders and the Investor
Fixed Allocation Percentage of such remaining proceeds and will be distributed
to the Certificateholders on the date such proceeds are received . If the
portion of such proceeds allocable to the Certificateholders are not sufficient
to pay in full the remaining amount due on the Certificates, the Policy will
cover such shortfall.

                                      S-61


         Notwithstanding the foregoing, if a conservator, receiver or
trustee-in-bankruptcy is appointed for the transferor and no Rapid Amortization
Event exists other than such conservatorship, receivership or insolvency of the
transferor, the conservator, receiver or trustee-in-bankruptcy may have the
power to prevent the commencement of the Rapid Amortization Period.

THE POLICY

         [On or before the closing date, the Policy will be issued by the
Certificate Insurer pursuant to the provisions of the pooling and servicing
agreement and the Insurance and Indemnity Agreement (the "Insurance Agreement")
to be dated as of the closing date, among the seller, the depositor, the master
servicer, the trustee and the Certificate Insurer.

         The Policy will irrevocably and unconditionally guarantee payment on
each distribution date to the trustee for the benefit of the Certificateholders
of each Class Of Certificates the full and complete payment of Insured Amounts
with respect to the related Certificates for such distribution date. An "Insured
Amount" shall equal with respect to each Class of Certificates as of any
distribution date any shortfall in amounts available in the Collection Account
to pay [(a)] (i) the Guaranteed Principal Distribution Amount (as defined in
this prospectus supplement) with respect to the related Certificates for such
distribution date and (ii) accrued and unpaid interest due on the related
Certificates (together, the "Guaranteed Distributions"), with such Guaranteed
Distributions having been calculated in accordance with the original terms of
the Certificates or the pooling and servicing agreement after giving effect to
amendments or modifications to which the Certificate Insurer has given its prior
written consent and (b) any Preference Amount (as defined in this prospectus
supplement) which occurs prior to the related Determination Date. The effect of
the Policy is to guarantee the timely payment of interest on, and the ultimate
payment of the principal amount of, all of the Certificates. [The Policy does
not cover any Basis Risk Carryforward.]

         The "Guaranteed Principal Distribution Amount" for any Class of
Certificates and distribution date (other than the distribution date in [ ] on
which the sum of the Available Transferor Subordinated Amounts for [both] loan
groups and the Reserve Fund has been reduced to or equals zero, shall be the
amount, if any, by which the Certificate Principal Balance of such Class of
Certificates (after giving effect to all other amounts distributable and
allocable to principal on the Certificates) exceeds the related Invested Amount
as of such distribution date (after giving effect to all other amounts
distributable and allocable to principal on the Certificates for such
distribution date) and on the distribution date in [ ] (after giving effect to
all other amounts distributable and allocable to principal on such distribution
date) any amount necessary to pay the outstanding Certificate Principal Balance.

         A "Preference Amount" means any amount previously distributed to a
Certificateholder that is recoverable and recovered as a voidable preference by
a trustee in bankruptcy pursuant to the United States Bankruptcy Code, as
amended from time to time, in accordance with a final nonappealable order of a
court having competent jurisdiction. If the Certificate Insurer is required to
pay any Preference Amount, the Certificate Insurer will pay such amount on the
later of

                                      S-62


         (a) the date when due to be paid pursuant to the order referred to
below or

         (b) the first to occur of

              o    the fourth Business Day following Receipt by the Certificate
                   Insurer from the trustee of (A) a certified copy of the order
                   of the court or other governmental body which exercised
                   jurisdiction to the effect that the Certificateholder is
                   required to return the amount of any Guaranteed Distributions
                   distributed with respect to the Certificates during the term
                   of the related Policy because such distributions were
                   avoidable preferences under applicable bankruptcy law, (B) a
                   certificate of the Certificateholder that the order has been
                   entered and is not subject to any stay and (C) an assignment
                   duly executed and delivered by the Certificateholder, in such
                   form as is reasonably required by the Certificate Insurer and
                   provided to the Certificateholder by the Certificate Insurer,
                   irrevocably assigning to the Certificate Insurer all rights
                   and claims of the Certificateholder arising under the
                   Certificates against the debtor which made such preference
                   payment or otherwise with respect to such preference payment,
                   or

              o    the date of Receipt by the Certificate Insurer from the
                   trustee of the items referred to in clauses (A), (B) and (C)
                   above if, at least four Business Days prior to Receipt, the
                   Certificate Insurer shall have received written notice from
                   the trustee that such items were to be delivered on such date
                   and such date was specified in such notice

         Payment of claims on the Policy will be made by the Certificate Insurer
following Receipt by the Certificate Insurer of the appropriate notice for
payment (and any other required documentation) on the later to occur of (i)
12:00 noon, New York City time, on the second Business Day following Receipt of
such notice for payment and (ii) 12:00 noon, New York City time, on the relevant
distribution date.

         The terms "Receipt" and "Received," with respect to the Policy, mean
actual delivery to the Certificate Insurer prior to 12:00 noon, New York City
time, on a business day; delivery either on a day that is not a business day or
after 12:00 noon, New York City time, shall be deemed to be Received on the next
succeeding business day. If any notice or certificate given under the Policy by
the trustee is not in proper form or is not properly completed, executed or
delivered, it shall be deemed not to have been Received, and the Certificate
Insurer shall promptly so advise the trustee and the trustee may submit an
amended notice.

         Under the Policy, "business day" means any day other than (i) a
Saturday or Sunday or (ii) a day on which banking institutions in the states of
New York, [California or Illinois or the city in which the corporate trust
office of the trustee or the Certificate Insurer is located], are authorized or
obligated by law or executive order to be closed.

         The Certificate Insurer's obligations under the Policy in respect of
Insured Amounts shall be discharged to the extent funds are transferred to the
trustee as provided in the Policy, whether or not such funds are properly
applied by the trustee.

                                      S-63


         The Certificate Insurer shall be subrogated to the rights of each
Certificateholder to receive payments of principal and interest, as applicable,
with respect to distributions on the Certificates to the extent of any payment
by the Certificate Insurer under the Policy. To the extent the Certificate
Insurer pays Insured Amounts, either directly or indirectly (as by paying
through the Trustee), to the Certificateholders, the Certificate Insurer will be
subrogated to the rights of the Certificateholders, as applicable, with respect
to such Insured Amounts and shall be deemed to the extent of the payments so
made to be a registered Certificateholder for purposes of payment.

         The terms of the Policy cannot be modified, altered or affected by any
other agreement or instrument, or by the merger, consolidation or dissolution of
the seller. The Policy by its terms may not be cancelled or revoked. The Policy
is governed by the laws of the State of [New York].

         Insured Amounts shall be paid only at the time set forth in the Policy
and no accelerated Insured Amounts shall be paid regardless of any acceleration
of the Certificates, unless such acceleration is at the sole option of the
Certificate Insurer. The Policy does not cover shortfalls, if any, attributable
to the liability of the trust fund or the trustee for withholding taxes, if any
(including interest and penalties in respect of any such liability).

         Capitalized terms used in the Policy and not otherwise defined in the
Policy shall have the respective meanings set forth in the pooling and servicing
agreement as of the date of execution of the Policy, without giving effect to
any subsequent amendment or modification to the pooling and servicing agreement
unless such amendment or modification has been approved in writing by the
Certificate Insurer.

         Pursuant to the terms of the pooling and servicing agreement, unless a
Certificate Insurer default exists, the Certificate Insurer shall be deemed to
be the Holder of the Certificates for certain purposes (other than with respect
to payment on the Certificates), will be entitled to exercise all rights of the
Certificateholders thereunder without the consent of such Holders, and the
Holders of the Certificates may exercise such rights only with the prior written
consent of the Certificate Insurer. In addition, the Certificate Insurer will
have certain additional rights as a third party beneficiary to the pooling and
servicing agreement.]

THE CERTIFICATE INSURER

         The following information set forth in this section has been provided
by [Certificate Insurer] (the "Certificate Insurer"). Accordingly, none of the
depositor, the seller and master servicer[, any third party credit. enhancer] or
the underwriter makes any representation as to the accuracy and completeness of
such information.

         [Description of Certificate Insurer, including Financial Information]

REPORTS TO CERTIFICATEHOLDERS

         Concurrently with each distribution to the Certificateholders, the
master servicer will forward to the trustee for mailing to such
Certificateholder a statement setting forth among other items:

                                      S-64


         (i)    the Investor Floating Allocation Percentage for each loan group
                for the preceding Collection Period;

         (ii)   the amount being distributed to each Class of Certificates;

         (iii)  the amount of interest included in such distribution and the
                related certificate rate for each Class of Certificates;

         (iv)   the amount, if any, of overdue accrued interest for a Class of
                Certificates included in such distribution (and the amount of
                interest thereon to the extent permitted by applicable law);

         (v)    the amount, if any, of the remaining overdue accrued interest
                for a Class of Certificates after giving effect to such
                distribution;

         (vi)   the amount, if any, of principal included in such distribution;

         (vii)  the amount, if any, of the reimbursement of previous [Investor
                Loss Amounts][Liquidation Loss Amounts] for a Class of
                Certificates included in such distribution,

         (viii) [the amount, if any, of Basis Risk Carryforward for a Class of
                Certificates paid and the amount, if any, of Basis Risk
                Carryforward accrued;]

         (ix)   the amount, if any, of the aggregate unreimbursed [Investor Loss
                Amounts][Liquidation Loss Amounts] for a Class of Certificates
                after giving effect to such distribution;

         (x)    the Servicing Fee for such distribution date;

         (xi)   [for each Class of Certificates:] the Invested Amount, [and] the
                Certificate Principal Balance [and the Pool Factor], each after
                giving effect to such distribution;

         (xii)  the loan group balance of each loan group as of the end of the
                preceding Collection Period;

         (xiii) the number and aggregate principal balances of the mortgage
                loans in each loan group as to which the minimum monthly payment
                is delinquent for 30-59 days, 60-89 days and 90 or more days,
                respectively, as of the end of the preceding Collection Period;

         (xiv)  the book value of any real estate in each loan group which is
                acquired by the trust fund through foreclosure or grant of deed
                in lieu of foreclosure;

         (xv)   the amount of any draws on the Policy [or payments under third
                party credit enhancement for loan group [ ]];

                                      S-65


         (xvi)  [the amount on deposit in the Reserve Fund on the preceding
                distribution date, after giving effect to all distributions made
                on that date, the amount withdrawn from the Reserve Fund with
                respect to this distribution date, and the amount remaining on
                deposit in the Reserve Fund;] and

         (xvii) [with respect to the first and second distribution dates, the
                number and aggregate balance of any mortgage loans in [either]
                loan group not delivered to the trustee within 30 days after the
                closing date.]

         In the case of information furnished pursuant to clauses (iii), (iv),
(v), (vi), (vii) and (viii) above, the amounts shall be expressed as a dollar
amount per $[1,000] increment of Certificates.

         Within 60 days after the end of each calendar year commencing in
200[ ], the master servicer will be required to forward to the Trustee a
statement containing the information set forth in clauses (iii) and (vi) above
aggregated for such calendar year.

COLLECTION AND OTHER SERVICING PROCEDURES ON MORTGAGE LOANS

         The master servicer will make reasonable efforts to collect all
payments called for under the mortgage loans and will, consistent with the
pooling and servicing agreement, follow such collection procedures as it follows
from time to time with respect to the home equity loans in its servicing
portfolio comparable to the mortgage loans. Consistent with the above, the
master servicer may in its discretion waive any late payment charge or any
assumption or other fee or charge that may be collected in the ordinary course
of servicing the mortgage loans.

         With respect to the mortgage loans, the master servicer may arrange
with a borrower a schedule for the payment of interest due and unpaid for a
period, provided that any such arrangement is consistent with the master
servicer's policies with respect to the mortgage loans it owns or services. In
accordance with the terms of the pooling and servicing agreement, the master
servicer may consent under certain circumstances to the placing of a subsequent
senior lien in respect of a mortgage loan.

HAZARD INSURANCE

         The pooling and servicing agreement provides that the master servicer
maintain certain hazard insurance on the mortgaged properties relating to the
mortgage loans. While the terms of the related credit line agreements generally
require borrowers to maintain certain hazard insurance, the master servicer will
not monitor the maintenance of such insurance.

         The pooling and servicing agreement requires the master servicer to
maintain for any mortgaged property relating to a mortgage loan acquired upon
foreclosure of a mortgage loan, or by deed in lieu of such foreclosure, hazard
insurance with extended coverage in an amount equal to the lesser of

         o    the maximum insurable value of such mortgaged property or

         o    the outstanding balance of such mortgage loan plus the outstanding
              balance on any mortgage loan senior to such mortgage loan at the
              time of foreclosure or deed in lieu

                                      S-66


              of foreclosure, plus accrued interest and the master servicer's
              good faith estimate of the related liquidation expenses to be
              incurred in connection therewith.

The pooling and servicing agreement provides that the master servicer may
satisfy its obligation to cause hazard policies to be maintained by maintaining
a blanket policy insuring against losses on such mortgaged properties. If such
blanket policy contains a deductible clause, the master servicer will be
obligated to deposit in the Collection Account the sums which would have been
deposited therein but for such clause. The master servicer will satisfy these
requirements by maintaining a blanket policy. As set forth above, all amounts
collected by the master servicer (net of any reimbursements to the master
servicer) under any hazard policy (except for amounts to be applied to the
restoration or repair of the mortgaged property) will ultimately be deposited in
the Collection Account.

         In general, the standard form of fire and extended coverage policy
covers physical damage to or destruction of the improvements on the property by
fire, lightning, explosion, smoke, windstorm and hail, and the like, strike and
civil commotion, subject to the conditions and exclusions specified in each
policy. Although the policies relating to the mortgage loans will be
underwritten by different insurers and therefore will not contain identical
terms and conditions, the basic terms thereof are dictated by state laws and
most of such policies typically do not cover any physical damage resulting from
the following: war, revolution, governmental actions, floods and other
water-related causes, earth movement (including earthquakes, landslides and
mudflows), nuclear reactions, 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 or an exact description of the insurance policies relating to the
mortgaged properties.

REALIZATION UPON DEFAULTED MORTGAGE LOANS

         The master servicer will foreclose upon or otherwise comparably convert
to ownership mortgaged properties securing such of the mortgage loans as come
into default when, in accordance with applicable servicing procedures under the
pooling and servicing agreement, no satisfactory arrangements can be made for
the collection of delinquent payments. In connection with such foreclosure or
other conversion, the master servicer will follow such practices as it deems
necessary or advisable and as are in keeping with its general mortgage servicing
activities, provided the master servicer will not be required to expend its own
funds in connection with foreclosure or other conversion, correction of default
on a related senior mortgage loan or restoration of any property unless, in its
sole judgment, such foreclosure, correction or restoration will increase net
liquidation proceeds. The master servicer will be reimbursed out of liquidation
proceeds [and, if necessary, from other collections on or in respect of the
mortgage loans,] for advances of its own funds as liquidation expenses before
any net liquidation proceeds are distributed to Certificateholders or the
transferor.

OPTIONAL PURCHASE OF DEFAULTED LOAN

         The master servicer may, at its option, purchase from the trust fund
any mortgage loan which is delinquent in payment for 91 days or more. Any such
purchase shall be at a price equal to 100% of the principal balance of such
mortgage loan plus accrued interest thereon at the

                                      S-67


applicable loan rate from the date through which interest was last paid by the
related mortgagor to the first day of the month in which such amount is to be
distributed to Certificateholders.

SERVICING COMPENSATION AND PAYMENT OF EXPENSES

         With respect to each Collection Period, the master servicer will
receive from interest received on the mortgage loans a portion of such interest
collections as a monthly servicing fee in the amount equal to [ ]% per annum
("Servicing Fee Rate") on the aggregate principal balances of the mortgage loans
as of the first day of the related Collection Period. All assumption fees, late
payment charges and other fees and charges, to the extent collected from
borrowers, will be retained by the master servicer as additional servicing
compensation.

         The master servicer will pay certain ongoing expenses associated with
the trust fund and incurred by it in connection with its responsibilities under
the pooling and servicing agreement. In addition, the master servicer will be
entitled to reimbursement for certain expenses incurred by it in connection with
defaulted mortgage loans and in connection with the restoration of mortgaged
properties, such right of reimbursement being prior to the rights of
Certificateholders to receive any related net liquidation proceeds and, if
necessary, other collections on or in respect of the mortgage loans.

EVIDENCE AS TO COMPLIANCE

         The pooling and servicing agreement provides for delivery on or before
[March 1] in each year, beginning [March 1, 200[ ]], to the trustee of an annual
statement signed by an officer of the master servicer to the effect that the
master servicer has fulfilled its material obligations under the pooling and
servicing agreement throughout the preceding fiscal year, except as specified in
such statement.

         On or before [March 1] of each year, beginning [March 1, 200[ ]], the
master servicer will furnish a report prepared by a firm of nationally
recognized independent public accountants (who may also render other services to
the master servicer or the transferor) to the trustee, the Certificate Insurer[,
any other third party credit enhancer] and the Rating Agencies to the effect
that such firm has examined certain documents and the records relating to
servicing of the mortgage loans under the pooling and servicing agreement and
that, on the basis of such examination, such firm believes that such servicing
was conducted in compliance with the pooling and servicing agreement except for
(a) such exceptions as such firm believes to be immaterial and (b) such other
exceptions as shall be set forth in such report.

CERTAIN MATTERS REGARDING THE MASTER SERVICER AND THE TRANSFEROR

         The pooling and servicing agreement provides that the master servicer
may not resign from its obligations and duties thereunder, except in connection
with a permitted transfer of servicing, unless

         (a)  such duties and obligations are no longer permissible under
              applicable law or are in material conflict by reason of applicable
              law with any other activities of a type and nature presently
              carried on by it or its affiliate or

                                      S-68


         (b)  upon the satisfaction of the following conditions:

              o    the master servicer has proposed a successor servicer to the
                   trustee in writing and such proposed successor servicer is
                   reasonably acceptable to the trustee;

              o    the Rating Agencies have confirmed to the trustee that the
                   appointment of such proposed successor servicer as the master
                   servicer will not result in the reduction or withdrawal of
                   the then current rating of the certificates without regard to
                   the Policy [or any other third party credit enhancement]; and

              o    such proposed successor servicer is reasonably acceptable to
                   the Certificate Insurer.

         No such resignation will become effective until the trustee or a
successor servicer has assumed the master servicer's obligations and duties
under the pooling and servicing agreement.

         The master servicer may perform any of its duties and obligations under
the pooling and servicing agreement through one or more subservicers or
delegates, which may be affiliates of the master servicer. Notwithstanding any
such arrangement, the master servicer will remain liable and obligated to the
trustee and the Certificateholders for the master servicer's duties and
obligations under the pooling and servicing agreement, without any diminution of
such duties and obligations and as if the master servicer itself were performing
such duties and obligations.

         The pooling and servicing agreement provides that the master servicer
will indemnify the trust fund and the trustee from and against any loss,
liability, expense, damage or injury suffered or sustained as a result of the
master servicer's actions or omissions in connection with the servicing and
administration of the mortgage loans which are not in accordance with the
provisions of the pooling and servicing agreement. Under the pooling and
servicing agreement, the transferor will indemnify an injured party for the
entire amount of any losses, claims, damages or liabilities arising out of or
based on the pooling and servicing agreement to the extent described therein
(other than losses resulting from defaults under the mortgage loans). In the
event of an Event of Servicing Termination (as defined below) resulting in the
assumption of servicing obligations by a successor master servicer, the
successor master servicer will indemnify the transferor for any losses, claims,
damages and liabilities of the transferor as described in this paragraph arising
from the successor master servicer's actions or omissions. The pooling and
servicing agreement provides that neither the depositor, the transferor nor the
master servicer nor their directors, officers, employees or agents will be under
any other liability to the trust fund, the trustee, the Certificateholders or
any other person for any action taken or for refraining from taking any action
pursuant to the pooling and servicing agreement. However, neither the depositor,
the transferor nor the master servicer will be protected against any liability
which would otherwise be imposed by reason of willful misconduct, bad faith or
gross negligence of the depositor, the transferor or the master servicer in the
performance of its duties under the pooling and servicing agreement or by reason
of reckless disregard of its obligations thereunder. In addition, the pooling
and servicing agreement provides that the master servicer will not be under any
obligation to appear in, prosecute or defend any legal action which is not
incidental to its servicing responsibilities under the pooling and servicing
agreement and which in its opinion may expose it to any expense or liability.
The master servicer may, in its sole

                                      S-69


discretion, undertake any such legal action which it may deem necessary or
desirable with respect to the pooling and servicing agreement and the rights and
duties of the parties thereto and the interest of the Certificateholders
thereunder.

         Any corporation into which the master servicer may be merged or
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the master servicer shall be a party, or any corporation
succeeding to the business of the master servicer shall be the successor of the
master servicer under the pooling and servicing agreement, without the execution
or filing of any paper or any further act on the part of any of the parties
thereto, anything in the pooling and servicing agreement to the contrary
notwithstanding.

EVENTS OF SERVICING TERMINATION

         "Events of Servicing Termination" will consist of:

         (i)  any failure by the master servicer to deposit in the Collection
              Account any deposit required to be made under the pooling and
              servicing agreement, which failure continues unremedied for five
              business days [(or, if the master servicer is permitted to remit
              collections in respect of the mortgage loans to the Collection
              Account on a monthly basis as described under "--Payments on
              Mortgage Loans; Deposits to Collection Account," three business
              days)] after the giving of written notice of such failure to the
              master servicer by the trustee, or to the master servicer and the
              trustee by the Certificate Insurer or Certificateholders
              evidencing an aggregate undivided interest in the Trust Fund of at
              least 25% of the aggregate Certificate Principal Balance;

        (ii)  any failure by the master servicer duly to observe or perform in
              any material respect any other of its covenants or agreements in
              the Certificates or the pooling and servicing agreement which, in
              each case, materially and adversely affects the interests of the
              Certificateholders[, any other third party credit enhancer] or the
              Certificate Insurer and continues unremedied for 60 days after the
              giving of written notice of such failure to the master servicer by
              the trustee, or to the master servicer and the trustee by the
              Certificate Insurer[, any other third party credit enhancer] or
              Certificateholders evidencing an aggregate, undivided interest in
              the trust fund of at least 25% of the aggregate Certificate
              Principal Balance; or

       (iii)  certain events of insolvency, readjustment of debt, marshalling of
              assets and liabilities or similar proceedings relating to the
              master servicer and certain actions by the master servicer
              indicating insolvency, reorganization or inability to pay its
              obligations. Under certain other circumstances, the Certificate
              Insurer or the holders of Certificates evidencing an aggregate,
              undivided interest in the trust fund of at least 66 2/3% of the
              aggregate Certificate Principal Balance may deliver written notice
              to the master servicer terminating all the rights and obligations
              of the master servicer under the pooling and servicing agreement.

         Notwithstanding the foregoing, a delay in or failure of performance
referred to under clause (i) above for a period of ten or more business days or
referred to under clause (ii) above

                                      S-70


for a period of 60 or more business days, shall not constitute an Event of
Servicing Termination if such delay or failure could not be prevented by the
exercise of reasonable diligence by the master servicer and such delay or
failure was caused by an act of God or other similar occurrence. Upon the
occurrence of any such event the master servicer shall not be relieved from
using its best efforts to perform its obligations in a timely manner in
accordance with the terms of the pooling and servicing agreement and the master
servicer shall provide the trustee, the depositor, the transferor, the
Certificate Insurer[, any other third party credit enhancer] and the
Certificateholders prompt notice of such failure or delay by it, together with a
description of its efforts to so perform its obligations.

RIGHTS UPON AN EVENT OF SERVICING TERMINATION

         So long as an Event of Servicing Termination remains unremedied, either
the trustee, or Certificateholders evidencing an aggregate undivided interest in
the trust fund of at least 66 2/3% of the aggregate Certificate Principal
Balance [(with the consent of the Certificate Insurer)] or the Certificate
Insurer, may terminate all of the rights and obligations of the master servicer
under the pooling and servicing agreement, whereupon the trustee will succeed to
all the responsibilities, duties and liabilities of the master servicer under
the pooling and servicing agreement and will be entitled to similar compensation
arrangements. In the event that the trustee would be obligated to succeed the
master servicer but is unwilling or unable so to act, it may appoint, or
petition a court of competent jurisdiction for the appointment of, a housing and
home finance institution or other mortgage loan or home equity loan servicer
with all licenses and permits required to perform its obligations under the
pooling and servicing agreement and having a net worth of at least $[ ] and
acceptable to the Certificate Insurer to act as successor to the master servicer
under the pooling and servicing agreement. Pending such appointment, the trustee
will be obligated to act in such capacity unless prohibited by law. Such
successor will be entitled to receive the same compensation that the master
servicer would otherwise have received (or such lesser compensation as the
trustee and such successor may agree upon). A receiver or conservator for the
master servicer may be empowered to prevent the termination and replacement of
the master servicer where the Event of Servicing Termination that has occurred
is an Insolvency Event.

AMENDMENT

         The pooling and servicing agreement may be amended from time to time by
the seller, the master servicer, the depositor and the trustee and with the
consent of the Certificate Insurer, but without the consent of the
Certificateholders,

         o    to cure any ambiguity,

         o    to correct any defective provision or to correct or supplement any
              provisions therein that may be inconsistent with any other
              provisions of the pooling and servicing agreement,

         o    to conform the pooling and servicing agreement to the final
              prospectus supplement provided to investors in accordance with the
              initial offering of the certificates,

                                      S-71


         o    to add to the duties of the depositor, the seller, [the
              transferor] or the master servicer,

         o    [to add or amend any provisions of the pooling and servicing
              agreement as required by the Rating Agencies in order to maintain
              or improve any rating of the Certificates (it being understood
              that, after obtaining the ratings in effect on the closing date,
              neither the transferor, the seller, the depositor, the trustee nor
              the master servicer is obligated to obtain, maintain, or improve
              any such rating),]

         o    to add any other provisions with respect to matters or questions
              arising under the pooling and servicing agreement [or the Policy
              which shall not be inconsistent with the provisions of the pooling
              and servicing agreement [or any other third party credit
              enhancement],]

         o    [to comply with any requirement imposed by the Code (as defined in
              this prospectus supplement)] or

         o    [to modify, alter, amend, add to or rescind any of the terms or
              provisions contained in the pooling and servicing agreement][to
              increase the limits set forth in the pooling and servicing
              agreement as to the amount of senior liens which the master
              servicer may consent to,] provided that such action will not, as
              evidenced by an opinion of counsel, materially and adversely
              affect the interests of any Certificateholder, the Certificate
              Insurer [or any other third party credit enhancer];

provided, that any such amendment will not be deemed to materially and adversely
affect the Certificateholders and no such opinion will be required to be
delivered if the person requesting such amendment obtains a letter from the
Rating Agencies stating that such amendment would not result in a downgrading of
the then current rating of the Certificates without regard to the Policy [or any
other third party credit enhancement.

         The pooling and servicing agreement may also be amended from time to
time by [the seller,] the master servicer, the depositor, and the trustee [and
the master servicer and the Certificate Insurer may from time to time consent to
the amendment of the Policy,] with the consent of the Certificateholders with
certificates evidencing at least 51% of the Certificate Principal Balance of the
affected Class and the Certificate Insurer for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
the pooling and servicing agreement or of modifying in any manner the rights of
the Certificateholders, provided that no such amendment will

         o    reduce in any manner the amount of, or delay the timing of,
              payments on the Certificates or distributions or payments under
              the Policy which are required to be made on any Certificate
              without the consent of the Holder of such Certificate,

         o    [adversely affect in any material respect the interests of the
              Certificate Insurer [or any other third party credit enhancer]]

         o    reduce the aforesaid percentage required to consent to any such
              amendment, without the consent of the Holders of all Certificates
              then outstanding or

                                      S-72


         o    adversely affect in any material respect the interests of the
              holders of any Class of Certificates in a manner other than
              described next to the first bullet point above, without the
              consent of the olders of certificates of such Class evidencing, as
              to such Class, percentage interests aggregating 66 2/3%.

TERMINATION; RETIREMENT OF THE CERTIFICATES

         The trust fund will terminate on the distribution date following the
later of

         (A)  payment in full of all amounts owing to the Certificate Insurer
              [and any other third party credit enhancer] and

         (B)  the earliest of

              o    the distribution date on which the Certificate Principal
                   Balance of each Class of Certificates has been reduced to
                   zero,

              o    the final payment or other liquidation of the last mortgage
                   loan in the trust fund,

              o    the optional transfer to the transferor of the certificates,
                   as described below; and

              o    the distribution date in [ ].

         The certificates will be subject to optional transfer to the transferor
on any distribution date on or after which the aggregate principal balance of
the mortgage loans as of the last day of the related Collection Period is
reduced to an amount less than or equal to [10]% of the sum of the aggregate
principal balance of the mortgage loans as of [ ] and the aggregate principal
balance of any Additional Home Equity Loans transferred to the trust fund as of
the respective cut-off date and all amounts due and owing to the Certificate
Insurer [and any other third party credit enhancer] including any unreimbursed
draws on the Policy [and unreimbursed payments under other third party credit
enhancement], together with interest thereon, as provided under the Insurance
Agreement, have been paid. The transfer price will be equal to the sum of

              o    the outstanding Certificate Principal Balance of each Class
                   of Certificates plus accrued and unpaid interest thereon at
                   the applicable certificate rate through the day preceding the
                   final distribution date [and

              o    an amount equal to any Basis Risk Carryforward for each Class
                   of Certificates plus accrued and unpaid interest thereon.]

In no event, however, will the trust fund created by the pooling and servicing
agreement continue for more than 21 years after the death of certain individuals
named in the pooling and servicing agreement. Written notice of termination of
the pooling and servicing agreement will be given to each certificateholder, and
the final distribution will be made only upon surrender and cancellation of the
certificates at an office or agency appointed by the trustee which will be
specified in the notice of termination.

                                      S-73


         [In addition, Certificates must be prepaid and redeemed in part with
any funds remaining in the relevant additional loan account on [     ] after the
purchase of any Additional Home Equity Loans on that day.]

THE TRUSTEE

         [Name of trustee], a [national] banking association with its principal
place of business in [State], has been named trustee pursuant to the pooling and
servicing agreement.

         The commercial bank or trust company serving as trustee may own
Certificates and have normal banking relationships with the depositor, the
master servicer, the seller and the Certificate Insurer and/or their affiliates.

         The trustee may resign at any time, in which event the depositor will
be obligated to appoint a successor trustee, as approved by the Certificate
Insurer. The depositor may also remove the trustee if the trustee ceases to be
eligible to continue as such under the pooling and servicing agreement or if the
trustee becomes insolvent. Upon becoming aware of such circumstances, the
depositor will be obligated to appoint a successor trustee, as approved by the
Certificate Insurer. 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.

         No holder of a Certificate will have any right under the pooling and
servicing agreement to institute any proceeding with respect to the pooling and
servicing agreement unless such holder previously has given to the trustee
written notice of default and unless Certificateholders evidencing an aggregate,
undivided interest in the trust fund of at least 51% of the aggregate
Certificate Principal Balance have made written requests 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 will be under no
obligation to exercise any of the trusts or powers vested in it by the pooling
and servicing agreement or to make any investigation of matters arising
thereunder or to institute, conduct or defend any litigation thereunder or in
relation thereto at the request, order or direction of any of the
Certificateholders, unless such Certificateholders have offered to the trustee
reasonable security or indemnity against the cost, expenses and liabilities
which may be incurred therein or thereby.

CERTAIN ACTIVITIES

         The Trust Fund will not borrow money, make loans, invest in securities
for the purpose of exercising control, underwrite securities, (except as
provided in the pooling and servicing agreement) engage in the purchase and sale
(or turnover) of investments, offer securities in exchange for property (except
the Certificates for the mortgage loans), or repurchase or otherwise reacquire
its securities. See "--Evidence as to Compliance" above for information
regarding reports as to the compliance by the master servicer with the terms of
the pooling and servicing agreement

                                      S-74


DEFAULT MANAGEMENT SERVICES

         In connection with the servicing of defaulted mortgage loans for which
the master servicer does not service directly, the master servicer may perform
certain default management and other similar services (including, but not
limited to, appraisal services) and may act as a broker in the sale of mortgaged
properties related to those mortgage loans. The master servicer will be entitled
to reasonable compensation for providing those services.

                      DESCRIPTION OF THE PURCHASE AGREEMENT

         The mortgage loans to be transferred to the trust fund by the depositor
will be purchased by the depositor from the seller pursuant to a purchase
agreement (the "Purchase Agreement") to be entered into between the depositor,
as purchaser of the mortgage loans, and the seller, as transferor of the
mortgage loans. Under the Purchase Agreement, the seller will agree to transfer
the mortgage loans and related Additional Balances to the depositor. Pursuant to
the pooling and servicing agreement, the mortgage loans will be immediately
transferred by the depositor to the trust fund, and the depositor will assign
its rights in, to and under the Purchase Agreement to the trust fund. The
following is a description of the material provisions of the Purchase Agreement.

TRANSFERS OF MORTGAGE LOANS

         Pursuant to the Purchase Agreement, the seller will transfer and assign
to the depositor, all of its interest in the mortgage loans [(including any
Additional Home Equity Loans)] and all of the Additional Balances thereafter
created. The purchase price of the mortgage loans is a specified percentage of
the face amount thereof as of the time of transfer and is payable by the
depositor in cash. The purchase price of each Additional Balance comprising the
principal balance of a mortgage loan is the amount of such Additional Balance.

REPRESENTATIONS AND WARRANTIES

         The seller will represent and warrant to the depositor that, among
other things, as of the closing date, it is duly organized and in good standing
and that it has the authority to consummate the transactions contemplated by the
Purchase Agreement. The seller will also represent and warrant to the depositor
that, among other things, immediately prior to the sale of the mortgage loans to
the depositor, the seller was the sole owner and holder of the mortgage loans
free and clear of any and all liens and security interests. The seller will make
similar representations and warranties in the pooling and servicing agreement.
The seller will also represent and warrant to the depositor that, among other
things, as of the closing date, (a) the Purchase Agreement constitutes a legal,
valid and binding obligation of the seller and (b) the Purchase Agreement
constitutes a valid sale to the depositor of all right, title and interest of
the seller in and to the mortgage loans and the proceeds thereof.

ASSIGNMENT TO TRUST FUND

         The seller will expressly acknowledge and consent to the depositor's
transfer of its rights relating to the mortgage loans under the pooling and
servicing agreement to the trust fund. The seller also will agree to perform its
obligations under the Purchase Agreement for the benefit of the trust fund.

                                      S-75


TERMINATION

         The Purchase Agreement will terminate upon the termination of the trust
fund.

                                 USE OF PROCEEDS

         The net proceeds to be received from the sale of the Class [ ]
Certificates will be applied by the depositor towards the purchase of the
initial loan group [ ] mortgage loans [and the deposit to the Additional Loan
Account].

                    MATERIAL FEDERAL INCOME TAX CONSEQUENCES

GENERAL

         The following discussion, which summarizes the material U.S. federal
income tax aspects of the purchase, ownership and disposition of the
Certificates, is based on the provisions of the Internal Revenue Code of 1986,
as amended (the "Code"), the Treasury Regulations thereunder, and published
rulings and court decisions in effect as of the date hereof, all of which are
subject to change, possibly retroactively. This discussion does not address
every aspect of the U.S. federal income tax laws which may be relevant to
Certificate Owners in light of their personal investment circumstances or to
certain types of Certificate Owners subject to special treatment under the U.S.
federal income tax laws (for example, banks and life insurance companies).
Accordingly, investors should consult their tax advisors regarding U.S. federal,
state, local, foreign and any other tax consequences to them of investing in the
Certificates.

CHARACTERIZATION OF THE CERTIFICATES AS INDEBTEDNESS

         Based on the application of existing law to the facts as set forth in
the pooling and servicing agreement and other relevant documents and assuming
compliance with the terms of the pooling and servicing agreement as in effect on
the date of issuance of the Certificates, Sidley Austin Brown & Wood LLP,
special tax counsel to the depositor ("Tax Counsel"), is of the opinion that the
Certificates will be treated as debt instruments for federal income tax purposes
as of such date. Accordingly, upon issuance, the Certificates will be treated as
"Debt Securities" as described in the prospectus. Furthermore, special tax
counsel to the depositor is of the opinion that neither the trust fund nor any
portion of the trust fund will be treated as either an association or a publicly
traded partnership taxable as a corporation or as a taxable mortgage pool. See
"Federal Income Tax Consequences" in the prospectus.

         The transferor and the Certificateholders express in the pooling and
servicing agreement their intent that, for applicable tax purposes, the
Certificates will be indebtedness secured by the mortgage loans. The transferor,
the depositor and the Certificateholders, by accepting the Certificates, and
each Certificate Owner by its acquisition of a beneficial interest in a
Certificate, have agreed to treat the Certificates as indebtedness for U.S.
federal income tax purposes. However, because different criteria are used to
determine the non-tax accounting characterization of the transaction, the
Transferor intends to treat this transaction as a sale of an interest in the
principal balances of the mortgage loans for financial accounting purposes.

                                      S-76


         In general, whether for U.S. federal income tax purposes a transaction
constitutes a sale of property or a loan, the repayment of which is secured by
property, is a question of fact, the resolution of which is based upon the
economic substance of the transaction rather than its form or the manner in
which it is labeled. While the Internal Revenue Service and the courts have set
forth several factors to be taken into account in determining whether the
substance of a transaction is a sale of property or a secured loan, the primary
factor in making this determination is whether the transferee has assumed the
risk of loss or other economic burdens relating to the property and has obtained
the benefits of ownership thereof. Tax Counsel has analyzed and relied on
several factors in reaching its opinion that the weight of the benefits and
burdens of ownership of the mortgage loans has been retained by the transferor
and has not been transferred to the Certificate Owners.

         In some instances, courts have held that a taxpayer is bound by the
particular form it has chosen for a transaction, even if the substance of the
transaction does not accord with its form. Tax Counsel has advised that the
rationale of those cases will not apply to this transaction, because the form of
the transaction as reflected in the operative provisions of the documents either
accords with the characterization of the Certificates as debt or otherwise makes
the rationale of those cases inapplicable to this situation.

TAXATION OF INTEREST INCOME OF CERTIFICATE OWNERS

         Assuming that the Certificate Owners are holders of debt obligations
for U.S. federal income tax purposes, the Certificates generally will be taxable
as Debt Securities. See "Federal Income Tax Consequences" in the prospectus.

         While it is not anticipated that the Certificates will be issued at a
greater than de minimis discount, under Treasury regulations (the "OID
Regulations") it is possible that the Certificates could nevertheless be deemed
to have been issued with original issue discount ("OID") if the interest were
not treated as "unconditionally payable" under the OID Regulations. If such
regulations were to apply, all of the taxable income to be recognized with
respect to the Certificates would be includible in income of Certificate Owners
as OID, but would not be includible again when the interest is actually
received. See "Federal Income Tax Consequences--Taxation of Debt Securities;
Interest and Acquisition Discount" in the prospectus for a discussion of the
application of the OID rules if the Certificates are in fact issued at a greater
than de minimis discount or are treated as having been issued with OID under the
OID Regulations. For purposes of calculating OID, it is likely that the
Certificates will be treated as Pay-Through Securities.

POSSIBLE CLASSIFICATION OF THE CERTIFICATES AS A PARTNERSHIP OR ASSOCIATION
TAXABLE AS A CORPORATION

         The opinion of Tax Counsel is not binding on the courts or the IRS. It
is possible that the IRS could assert that, for purposes of the Code, the
transaction contemplated by this prospectus supplement and the accompanying
prospectus with respect to the Certificates constitutes a sale of the mortgage
loans (or an interest therein) to the Certificate Owners and that the proper
classification of the legal relationship between the transferor and the
Certificate Owners resulting from this transaction is that of a partnership, a
publicly traded partnership treated as a

                                      S-77


corporation, or an association taxable as a corporation. Since Tax Counsel has
advised that the Certificates will be treated as indebtedness in the hands of
the Certificateholders for U.S. federal income tax purposes, the transferor will
not attempt to comply with U.S. federal income tax reporting requirements
applicable to partnerships or corporations.

         If it were determined that this transaction created an entity
classified as a corporation (including a publicly traded partnership taxable as
a corporation), the trust fund would be subject to U.S. federal income tax at
corporate income tax rates on the income it derives from the mortgage loans,
which would reduce the amounts available for distribution to the Certificate
Owners. Cash distributions to the Certificate Owners generally would be treated
as dividends for tax purposes to the extent of such corporation's earnings and
profits.

         If the transaction were treated as creating a partnership between the
Certificate Owners and the transferor, the partnership itself would not be
subject to U.S. federal income tax (unless it were to be characterized as a
publicly traded partnership taxable as a corporation); rather, the transferor
and each Certificate Owner would be taxed individually on their respective
distributive shares of the partnership's income, gain, loss, deductions and
credits. The amount and timing of items of income and deductions of the
Certificate Owner could differ if the Certificates were held to constitute
partnership interests rather than indebtedness. Assuming that all of the
provisions of the pooling and servicing agreement, as in effect on the date of
the issuance, are complied with, it is the opinion of Tax Counsel that the trust
fund will not be treated as either an association or a partnership taxable as a
corporation or as a taxable mortgage pool.

POSSIBLE CLASSIFICATION AS A TAXABLE MORTGAGE POOL

         In relevant part, Section 7701(i) of the Code provides that any entity
(or a portion of an entity) that is a "taxable mortgage pool" will be classified
as a taxable corporation and will not be permitted to file a consolidated U.S.
federal income tax return with another corporation. Any entity (or a portion of
any entity) will be a taxable mortgage pool if (i) substantially all of its
assets consist of debt instruments, more than 50% of which are real estate
mortgages, (ii) the entity is the obligor under debt obligations with two or
more maturities, and (iii) under the terms of the entity's debt obligations (or
an underlying arrangement), payments on such debt obligations bear a
relationship to the debt instruments held by the entity.

         Assuming that all of the provisions of the pooling and servicing
agreement, as in effect on the date of issuance, are complied with, Tax Counsel
is of the opinion that neither the trust fund nor any portion of the trust fund
will be a taxable mortgage pool under Section 7701(i) of the Code because
payments on each loan group support only one class of indebtedness.

         The opinion of Tax Counsel is not binding on the IRS or the courts. If
the IRS were to contend successfully (or future regulations were to provide)
that the arrangement created by the pooling and servicing agreement is a taxable
mortgage pool, such arrangement would be subject to U.S. federal corporate
income tax on its taxable income generated by ownership of the mortgage loans.
Such a tax might reduce amounts available for distributions to Certificate
Owners. The amount of such a tax would depend upon whether distributions to
Certificate Owners would be deductible as interest expense in computing the
taxable income of such an arrangement as a taxable mortgage pool.

                                      S-78


FOREIGN INVESTORS

         In general, subject to certain exceptions, interest (including OID)
paid on a Certificate to a nonresident alien individual, foreign corporation or
other non-United States person is not subject to U.S. federal income tax,
provided that such interest is not effectively connected with a trade or
business of the recipient in the United States and the Certificate Owner
provides the required foreign person information certification. See "Federal
Income Tax Consequences--Tax Treatment of Foreign Investors" in the prospectus.

         Interest paid (or accrued) to a Certificateholder who is a non-U.S.
Person will be considered "portfolio interest," and generally will not be
subject to U.S. federal income and withholding tax, provided, that (i) the
interest is not effectively connected with the conduct of a trade or business
within the United States by the non-U.S. Person, (ii) the non-U.S. Person
provides the trust fund or other person who is otherwise required to withhold
U.S. tax with respect to the Certificate with an appropriate statement (on Form
W-8BEN or other similar form), signed under penalties of perjury, certifying
that the beneficial owner of the Certificate is a foreign person and providing
that non-U.S. person's name and address. If a Certificate is held through a
securities clearing organization or certain other financial institutions, the
organization or institution may provide the relevant signed statement to the
withholding agent; in that case, however, the signed statement must be
accompanied by a Form W-8BEN or substitute form provided by the non-U.S. Person
that owns that interest in the mortgage loan. If such interest does not
constitute portfolio interest, then it will be subject to U.S. federal income
and withholding tax at a rate of 30%, unless reduced or eliminated pursuant to
an applicable tax treaty and the non-U.S. Person provides the Trust Fund, or an
organization or financial institution described above, with an appropriate
statement (e.g., a Form W-8BEN), signed under penalties of perjury, to that
effect.

         If the interests of the Certificate Owners were deemed to be
partnership interests, the partnership would be required, on a quarterly basis,
to pay withholding tax equal to the product, for each foreign partner, of such
foreign partner's distributive share of "effectively connected" income of the
partnership multiplied by the highest rate of tax applicable to that foreign
partner. In addition, a corporate foreign partner would be subject to branch
profits tax. Each non-foreign partner would be required to certify to the
partnership that it is not a foreign person. The tax withheld from each foreign
partner would be credited against such foreign partner's U.S. income tax
liability.

         In addition, the interest paid on Certificates could be subject to a
30% withholding tax (or lower treaty rate) either because the interest on the
mortgage loans does not appear to satisfy the requirements to be treated as
"portfolio interest" under the Code, or because, even if such mortgage loan
interest were to be treated as portfolio interest, interest payments on the
Certificates could be treated as "guaranteed payments" within the meaning of the
partnership provisions of the Code.

         If the trust fund were taxable as a corporation, distributions to
foreign persons, to the extent treated as dividends, would generally be subject
to withholding at the rate of 30%, unless such rate were reduced by an
applicable tax treaty.

                                      S-79


BACKUP WITHHOLDING

         Certain Certificate Owners may be subject to backup withholding with
respect to interest paid on the Certificates if the Certificate Owner, upon
issuance, fails to supply the trustee or his broker with his taxpayer
identification number, furnish an incorrect taxpayer identification number, fail
to report interest, dividends, or other "reportable payments" (as defined in the
Code) properly, or, under certain circumstances, fail to provide the Trustee or
his broker with a certified statement, under penalty of perjury, that he is not
subject to backup withholding.

         The trustee will be required to report annually to the IRS, and to each
Certificateholder of record, the amount of interest paid (and OID accrued, if
any) on the Certificates (and the amount of interest withheld for U.S. federal
income taxes, if any) for each calendar year, except as to exempt holders
(generally, holders that are corporations, certain tax-exempt organizations or
nonresident aliens who provide certification as to their status as
nonresidents). As long as the only "Certificateholder" of record is Cede & Co.,
as nominee for DTC, Certificate Owners and the IRS will receive tax and other
information including the amount of interest paid on the Certificates owned from
Participants and Indirect Participants rather than from the trustee. (The
trustee, however, will respond to requests for necessary information to enable
Participants, Indirect Participants and certain other persons to complete their
reports.) Each non-exempt Certificate Owner will be required to provide, under
penalty of perjury, a certificate on IRS Form W-9 containing his or her name,
address, correct federal taxpayer identification number and a statement that he
or she is not subject to backup withholding. Should a nonexempt Certificate
Owner fail to provide the required certification, the Participants or Indirect
Participants (or the Paying Agent) will be required to withhold interest and
principal otherwise payable to the holder, and remit the withheld amount to the
IRS as a credit against the holder's federal income tax liability.

                                   STATE TAXES

         The depositor makes no representations regarding the tax consequences
of purchase, ownership or disposition of the Certificates under the tax laws of
any state. Investors considering an investment in the Certificates should
consult their own tax advisors regarding such tax consequences.

         ALL INVESTORS SHOULD CONSULT THEIR OWN TAX ADVISORS REGARDING THE
FEDERAL, STATE, LOCAL OR FOREIGN INCOME TAX CONSEQUENCES OF THE PURCHASE,
OWNERSHIP AND DISPOSITION OF THE CERTIFICATES.

                              ERISA CONSIDERATIONS

         [The fiduciary of any pension or other employee benefit plan (a "Plan")
which proposes to cause such Plan to acquire any of the Certificates should
consult with its counsel with respect to the potential consequences under the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and the
Code, of the Plan's acquisition and ownership of such Certificates. See "ERISA
Considerations" in the prospectus.

         Section 406 of ERISA prohibits "parties in interest" with respect to an
employee benefit plan subject to ERISA from engaging in certain transactions
involving such plan and its assets

                                      S-80


unless a statutory, regulatory or administrative exemption applies to the
transaction. Section 4975 of the Code imposes certain excise taxes on prohibited
transactions involving "disqualified persons" and employee benefit plans or
other arrangements (including, but not limited to, individual retirement
accounts) described under that Section (together with employee benefit plans
subject to ERISA, "Plans"); ERISA authorizes the imposition of civil penalties
for prohibited transactions involving Plans not subject to the requirements of
Section 4975 of the Code. Any Plan fiduciary which proposes to cause a Plan to
acquire the Offered Certificates should consult with its counsel with respect to
the potential consequences under ERISA and the Code of the Plan's acquisition
and ownership of such Certificates. See "ERISA Considerations" in the
prospectus.

         Certain employee benefit plans, including governmental plans and
certain church plans, are not subject to ERISA's requirements. Accordingly,
assets of such plans may be invested in the Certificates without regard to the
ERISA considerations described in this prospectus supplement and in the
prospectus, subject to the provisions of other applicable federal and state law.
Any such plan that is qualified and exempt from taxation under Sections 401(a)
and 501(a) of the Code may nonetheless be subject to the prohibited transaction
rules set forth in Section 503 of the Code.

         Except as noted above, investments by Plans are subject to ERISA's
general fiduciary requirements, including

         o    the requirement of investment prudence and diversification and

         o    the requirement that a Plan's investments be made in accordance
              with the documents governing the Plan.

A fiduciary that decides to invest the assets of a Plan in the Certificates
should consider, among other factors, the extreme sensitivity of the investment
to the rate of principal payments (including prepayments) on the mortgage loans.

         [In Prohibited Transaction Exemption 83-1 (the "Exemption"), the
Department of Labor ("DOL") exempted from ERISA's prohibited transaction rules

         o    certain transactions relating to the operation of residential
              mortgage pool investment trusts and

         o    the purchase, sale and holding of "mortgage pool pass-through
              certificates" in the initial issuance of such certificates.

The Exemption permits, subject to certain conditions, transactions that might
otherwise be prohibited between Plans and "parties in interest" with respect to
those Plans related to

         o    the origination, maintenance and termination of mortgage pools
              consisting of mortgage loans secured by first or second mortgages
              or deeds of trust on single-family residential property, and

                                      S-81


         o    the acquisition and holding of certain mortgage pool pass-through
              certificates representing an interest in such mortgage pools by
              Plans.

If the general conditions of the Exemption are satisfied, investments by a Plan
in certificates that represent interests in a mortgage pool consisting of
mortgage loans representing loans for single family homes ("Single Family
Certificates") will be exempt from the prohibitions of ERISA Sections 406(a) and
407 (relating generally to transactions with "parties in interest" who are not
fiduciaries) if

         o    the Plan purchases the Single Family Certificates at no more than
              fair market value and

         o    the Certificates are not subordinated to the other Certificates
              issued by the same pool,

and will be exempt from the prohibitions of ERISA Sections 406(b)(1) and (2)
(relating generally to transactions with fiduciaries) if, in addition,

         o    the purchase is approved by an independent fiduciary,

         o    no sales commission is paid to the pool seller,

         o    a Plan does not purchase more than twenty-five percent (25%) of
              all Single Family Certificates and

         o    at least fifty percent (50%) of all Single Family Certificates are
              purchased by persons independent of the pool seller or pool
              trustee.

It is believed that the Exemption will apply to the acquisition and holding of
the Class [ ] Certificates by Plans and that all conditions of the Exemption
other than those within the control of the investors will be met.

         Any Plan fiduciary considering whether to purchase any Class [ ]
Certificates on behalf of a Plan should consult with its counsel regarding the
applicability of the fiduciary responsibility and prohibited transaction
provisions of ERISA and the Code to such investment. Among other things, before
purchasing any Class [ ] Certificates, a fiduciary of a Plan subject to the
fiduciary responsibility provisions of ERISA or an employee benefit plan subject
to the prohibited transaction provisions of the Code should make its own
determination as to the availability of the exemptive relief provided in the
Exemption, and also consider the availability of any other prohibited
transaction exemptions.]

         [The U.S. Department of Labor has granted to [Underwriter] an
administrative exemption (Prohibited Transaction Exemption[ ]; Exemption
Application No.[ ], Fed. Reg.] ([ ]) (the "Exemption") from certain of the
prohibited transaction rules of ERISA and the related excise tax provisions of
Section 4975 of the Code with respect to the initial purchase, the holding and
the subsequent resale by Plans of certificates in pass-through trusts that
consist of certain receivables, loans and other obligations and the servicing,
operation and management of such asset-backed pass-through trusts; provided that
the conditions and

                                      S-82


requirements of the Exemption are met. The Exemption will apply to the
acquisition, holding and resale of the Certificates by a Plan provided that
certain conditions are met. For a general description of the Exemption and the
conditions that must be satisfied for the exemption to apply, see "ERISA
Considerations" in the prospectus.

         It is believed that the Exemption will apply to the acquisition and
holding of the Class [ ] Certificates by Plans and that all conditions of the
Exemption other than those within the control of the investors will be met.]

         Any Plan fiduciary considering whether to purchase any Certificates on
behalf of a Plan should consult with its counsel regarding the applicability of
the fiduciary responsibility and prohibited transaction provisions of ERISA and
the Code to such investment. Among other things, before purchasing any
Certificates, a fiduciary of a Plan subject to the fiduciary responsibility
provisions of ERISA or an employee benefit plan subject to the prohibited
transaction provisions of the Code should make its own determination as to the
availability of the exemptive relief provided in the Exemption, and also
consider the availability of any other prohibited transaction exemptions.

                         LEGAL INVESTMENT CONSIDERATIONS

         Although, as a condition to their issuance, the Class [ ] Certificates
will be rated in the highest rating category of each of the Rating Agencies, the
Class [ ] Certificates will not constitute "mortgage related securities" for
purposes of the Secondary Mortgage Market Enhancement Act of 1984 ("SMMEA"),
because not all of the mortgages securing the mortgage loans are first
mortgages. Accordingly, many institutions with legal authority to invest in
comparably rated securities based on first mortgage loans may not be legally
authorized to invest in the Class [ ] Certificates, which because they evidence
interests in a pool that includes junior mortgage loans are not "mortgage
related securities" under SMMEA. See "Legal Investment" in the prospectus.

                                  UNDERWRITING

         Subject to the terms and conditions set forth in the underwriting
agreement, dated [ ], 200[ ], between the depositor and [ ] ("[ ]"), which is an
affiliate of the depositor, the seller and the master servicer), the depositor
has agreed to sell to [ ], and [ ] has agreed to purchase from the depositor,
the Class [ ] Certificates.

         In the underwriting agreement, [ ] has agreed, subject to the terms and
conditions set forth therein, to purchase all the Certificates offered hereby if
any of the Certificates are purchased.

         The depositor has been advised by [ ] that it proposes initially to
offer the Class [ ] Certificates to the public in Europe and the United States
at the offering price set forth on the cover page hereof and to certain dealers
at such price less a discount not in excess of [ ]% of the Certificate
denominations. [ ] may allow and such dealers may reallow a discount not in
excess of [ ]% of the Certificate denominations to certain other dealers. After
the initial public offering, the public offering price, such concessions and
such discounts may be changed.

                                      S-83


         Until the distribution of the Class [ ] Certificates is completed,
rules of the Securities and Exchange Commission may limit the ability of [ ] and
certain selling group members to bid for and purchase the Class [ ]
Certificates. As an exception to these rules, [ ] is permitted to engage in
certain transactions that stabilize the price of the Class [ ] Certificates.
Such transactions consist of bids or purchases for the purposes of pegging,
fixing or maintaining the price of the Class [ ] Certificates.

         In general, purchases of a security for the purpose of stabilization or
to reduce a short position could cause the price of the security to be higher
than it might be in the absence of such purchases.

         Neither the depositor nor [ ] makes any representation or prediction as
to the direction or magnitude of any effect that the transactions described
above may have on the prices of the Certificates. In addition, neither the
depositor nor [ ] makes any representation that [ ] will engage in such
transactions or that such transactions, once commenced, will not be discontinued
without notice. .

         The underwriting agreement provides that the depositor will indemnify [
] against certain civil liabilities, including liabilities under the Act.

                                  LEGAL MATTERS

         Certain legal matters with respect to the Certificates will be passed
upon for the Depositor by Sidley Austin Brown & Wood LLP, New York, New York. [
], will pass upon certain legal matters on behalf of the underwriters.

                                     EXPERTS

         [The consolidated financial statements of the [Certificate Insurer] and
its subsidiaries, as of [month] [day], [year] and [year] and for each of the
years in the [number]-year period ended [month] [day], [year], are incorporated
by reference in this prospectus supplement and in the registration statement in
reliance upon the report of [ ], independent certified public accountants,
incorporated by reference in this prospectus supplement, and upon the authority
of said firm as experts in accounting and auditing.]

                                     RATINGS

         It is a condition to the issuance of the Class [ ] Certificates that
they be rated [ ] by [Rating Agency] and [ ] by [Rating Agency] (each a "Rating
Agency").

         A securities rating addresses the likelihood of the receipt by
Certificateholders of distributions on the mortgage loans. The rating takes into
consideration the characteristics of the mortgage loans and the structural and
legal aspects associated with the Certificates. The ratings on the Certificates
do not, however, constitute statements regarding the likelihood or frequency of
prepayments on the mortgage loans or the possibility that Certificateholders
might realize a lower than anticipated yield. [The ratings on the Certificates
do not address the likelihood of the receipt by Certificateholders of Basis Risk
Carryforward.]

                                      S-84


         The ratings assigned to the Class [ ] Certificates will depend
primarily upon the financial strength of the Certificate Insurer. Any reduction
in a rating assigned to the financial strength of the Certificate Insurer below
the ratings initially assigned to the Certificates may result in a reduction of
one or more of the ratings assigned to the Certificates.

         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. Each securities rating should be evaluated
independently of similar ratings on different securities.

         The depositor has not requested a rating of the 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 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 Certificates could be lower than the
respective ratings assigned by the Rating Agencies.





                                      S-85


                             INDEX OF DEFINED TERMS


                                                                            Page
                                                                            ----

Accelerated Principal Distribution Amount ........................... S-39, S-55
Additional Balances ....................................................... S-37
Additional Home Equity Loans .............................................. S-25
Additional Loan Account ................................................... S-25
Alternative Principal Payment ............................................. S-59
Available Transferor Subordinated Amount .................................. S-61
Bankruptcy Rate ........................................................... S-21
Basis Risk Carryforward ................................................... S-57
Beneficial Owner .......................................................... S-40
Business Day .............................................................. S-64
Cedel S A ................................................................. S-42
Certificate Insurer ....................................................... S-65
Certificate Owners ........................................................ S-40
Certificate Principal Balance ............................................. S-38
certificate rate .......................................................... S-57
Certificateholder ................................................... S-40, S-81
Certificates .............................................................. S-37
CI ........................................................................ S-42
Class ..................................................................... S-37
Class [   ]  Original Certificate Principal Balance ....................... S-38
Class [   ] Original Invested Amount ...................................... S-38
Class [  ] Original Certificate Principal Balance ......................... S-38
Clearstream, Luxembourg ................................................... S-42
Code ...................................................................... S-76
Collection Account ........................................................ S-50
Collection Period ......................................................... S-57
Cooperative ............................................................... S-43
Credit Limit Utilization Rate ............................................. S-30
Crossover Amount .......................................................... S-55
cut-off date .............................................................. S-22
cut-off date pool balance ................................................. S-22
DBC ....................................................................... S-42
Debt Securities ........................................................... S-77
Defective Mortgage Loans .................................................. S-48
Detailed Description ...................................................... S-22
Determination Date ........................................................ S-50
distribution date ......................................................... S-54
DOL ....................................................................... S-82
DTC ...................................................................... A-I-1
DTC Participants .......................................................... S-40
Eligible Account .......................................................... S-50
Eligible Substitute Mortgage Loan ......................................... S-47
ERISA ..................................................................... S-82
Euroclear Operator ........................................................ S-43
Euroclear Participants .................................................... S-43
European Depositaries ..................................................... S-40
Events of Servicing Termination ........................................... S-70
Exemption ........................................................... S-82, S-83
Financial Intermediary .................................................... S-41
First Federal ............................................................. S-19
Foreclosure Rate .......................................................... S-21
Global Securities ........................................................ A-I-1
Guaranteed Distributions .................................................. S-62
Guaranteed Principal Distribution Amount .................................. S-63
Holdings .................................................................. S-19
Index ..................................................................... S-23
Index Rate ................................................................ S-23
Indirect Participants ..................................................... S-41
IndyMac Bank .............................................................. S-19
Insurance Agreement ....................................................... S-62
Insured Amount ............................................................ S-62
Interest Collections ...................................................... S-53
Interest Period ........................................................... S-58
Invested Amount ........................................................... S-38
Investor Fixed Allocation Percentage ...................................... S-34
Investor Floating Allocation Percentage ................................... S-54
Investor Interest Collections ............................................. S-53
Investor Loss Amount ...................................................... S-56
Investor Principal Collections ............................................ S-54
LIBOR ..................................................................... S-57
LIBOR Business Day ........................................................ S-58
Liquidated Mortgage Loan .................................................. S-56
Liquidation Loss Amount ................................................... S-56
Liquidation Proceeds ...................................................... S-53
Loan Group Balance ........................................................ S-54
Managed Amortization Period ............................................... S-59
Maximum Principal Payment ................................................. S-59
Minimum Transferor Interest ............................................... S-50
Mortgage Loan Schedule .................................................... S-49
Mortgage Pool Pass-Through Certificates ................................... S-82
Net Liquidation Proceeds .................................................. S-53
New CI .................................................................... S-42

                                      S-86




New Withholding Regulations ............................................... S-80
OID ....................................................................... S-78
OID Regulations ........................................................... S-78
Original Invested Amount .................................................. S-38
Overcollateralization Reduction Amount .................................... S-39
Paying Agent .............................................................. S-60
Plan ...................................................................... S-81
Plans ..................................................................... S-82
Pool Factor ............................................................... S-36
Preference Amount ......................................................... S-63
principal balance ......................................................... S-24
Principal Collections ..................................................... S-53
Purchase Agreement ........................................................ S-75
Rapid Amortization Event .................................................. S-61
Rapid Amortization Period ................................................. S-59
Receipt ................................................................... S-64
Received .................................................................. S-64
Reference Bank Rate ....................................................... S-58
Related Documents ......................................................... S-46
Required Amount ........................................................... S-60
Reserve Fund .............................................................. S-39
Rules ..................................................................... S-41
Scheduled Principal Collections Distribution Amount ....................... S-59
Servicing Fee Rate ........................................................ S-68
Single Family Certificates ................................................ S-83
SMMEA ..................................................................... S-84
Statistic Calculation Date ................................................ S-23
Statistic Calculation Pool ................................................ S-22
Statistic Calculation Pool Mortgage Loan .................................. S-22
Subordinated Transferor Collections ....................................... S-60
Tax Counsel ............................................................... S-77
Taxable Mortgage Pool ..................................................... S-79
Telerate Screen Page 3750 ................................................. S-58
Terms and Conditions ...................................................... S-44
Transfer Date ............................................................. S-49
Transfer Deficiency ....................................................... S-47
Transfer Deposit Amount ................................................... S-47
Transferor ................................................................ S-39
Transferor Interest ....................................................... S-38
Transferor Principal Collections .......................................... S-54
U S  Person .............................................................. A-I-5



                                      S-87


                                     ANNEX I

                      GLOBAL CLEARANCE, SETTLEMENT AND TAX
                            DOCUMENTATION PROCEDURES

         Except in certain limited circumstances, the globally offered Home
Equity Loan Asset Backed Certificates, Series [200[ ]-[ ] ](the "Global
Securities") will be available only in book-entry form. Investors in the Global
Securities may hold such Global Securities through any of The Depository Trust
Company ("DTC"), Clearstream, Luxembourg or Euroclear. The Global Securities
will be tradable as home market instruments in both the European and U.S.
domestic markets. Initial settlement and all secondary trades will settle in
same-day funds.

         Secondary market trading between investors holding interests in Global
Securities through Clearstream, Luxembourg and Euroclear will be conducted in
accordance with their normal rules and operating procedures and in accordance
with conventional eurobond practice. Secondary market trading between investors
holding interests in Global Securities through DTC will be conducted according
to the rules and procedures applicable to U.S. corporate debt obligations.

         Secondary cross-market trading between investors holding interests in
Global Securities through Clearstream, Luxembourg or Euroclear and investors
holding interests in Global Securities through DTC Participants will be effected
on a delivery-against-payment basis through the respective depositories of
Clearstream, Luxembourg and Euroclear (in such capacity) and other DTC
Participants.

         Although DTC, Euroclear and Clearstream, Luxembourg are expected to
follow the procedures described below in order to facilitate transfers of
interests in the Global Securities among participants of DTC, Euroclear and
Clearstream, Luxembourg, they are under no obligation to perform or continue to
perform such procedures, and such procedures may be discontinued at any time.
Neither the Issuer nor the Trustee will have any responsibility for the
performance by DTC, Euroclear and Clearstream, Luxembourg or their respective
participants or indirect participants of their respective obligations under the
rules and procedures governing their obligations.

         Non-U.S. holders (as described below) of Global Securities will be
subject to U.S. withholding taxes unless such holders meet certain requirements
and deliver appropriate U.S. tax documents to the securities clearing
organizations or their participants.

INITIAL SETTLEMENT

         The Global Securities will be registered in the name of Cede & Co. as
nominee of DTC. Investors' interests in the Global Securities will be
represented through financial institutions acting on their behalf as direct and
indirect Participants in DTC. Clearstream, Luxembourg and Euroclear will hold
positions on behalf of their participants through their respective depositories,
which in turn will hold such positions in accounts as DTC Participants.

         Investors electing to hold interests in Global Securities through DTC
Participants, rather than through Clearstream, Luxembourg or Euroclear accounts,
will be subject to the settlement

                                      A-1-1


practices applicable to similar issues of pass-through certificates. Investors'
securities custody accounts will be credited with their holdings against payment
in same-day funds on the settlement date.

         Investors electing to hold interests in Global Securities through
Clearstream, Luxembourg or Euroclear accounts will follow the settlement
procedures applicable to conventional eurobonds, except that there will be no
temporary global security and no "lock-up" or restricted period. Interests in
Global Securities will be credited to the securities custody accounts on the
settlement date against payment in same-day funds.

SECONDARY MARKET TRADING

         Since the purchaser determines the place of delivery, it is important
to establish at the time of the trade where both the purchaser's and seller's
accounts are located to ensure that settlement can be made on the desired value
date.

         Transfers between DTC Participants. Secondary market trading between
DTC Participants will be settled using the DTC procedures applicable to similar
issues of pass-through certificates in same-day funds.

         Transfers between Clearstream, Luxembourg and/or Euroclear
Participants. Secondary market trading between Clearstream, Luxembourg
Participants or Euroclear Participants and/or investors holding interests in
Global Securities through them will be settled using the procedures applicable
to conventional eurobonds in same-day funds.

         Transfers between DTC seller and Clearstream, Luxembourg or Euroclear
purchaser. When interests in Global Securities are to be transferred on behalf
of a seller from the account of a DTC Participant to the account of a
Clearstream, Luxembourg Participant or a Euroclear Participant or a purchaser,
the purchaser will send instructions to Clearstream, Luxembourg or Euroclear
through a Clearstream, Luxembourg Participant or Euroclear Participant at least
one business day prior to settlement. Clearstream, Luxembourg or the Euroclear
Operator will instruct its respective depository to receive an interest in the
Global Securities against payment. Payment will include interest accrued on the
Global Securities from and including the last distribution date to but excluding
the settlement date. Payment will then be made by the respective depository to
the DTC Participant's account against delivery of an interest in the Global
Securities. After such settlement has been completed, such interest will be
credited to the respective clearing system, and by the clearing system, in
accordance with its usual procedures, to the Clearstream, Luxembourg
Participant's or Euroclear Participant's account. The credit of such interest
will appear on the next business day and the cash debit will be back-valued to,
and the interest on the Global Securities will accrue from, the value date
(which would be the preceding day when settlement occurred in New York). If
settlement is not completed through DTC on the intended value date (i.e., the
trade fails), the Clearstream, Luxembourg or Euroclear cash debit will be valued
instead as of the actual settlement date.

         Clearstream, Luxembourg Participants and Euroclear Participants will
need to make available to the respective clearing system the funds necessary to
process same-day funds settlement. The most direct means of doing so is to
pre-position funds for settlement from cash

                                      A-1-2


on hand, in which case such Clearstream, Luxembourg Participants or Euroclear
Participants will take on credit exposure to Clearstream, Luxembourg or the
Euroclear Operator until interests in the Global Securities are credited to
their accounts one day later.

         As an alternative, if Clearstream, Luxembourg or the Euroclear Operator
has extended a line of credit to them, Clearstream, Luxembourg Participants or
Euroclear Participants can elect not to pre-position funds and allow that credit
line to be drawn upon. Under this procedure, Clearstream, Luxembourg
Participants or Euroclear Participants receiving interests in Global Securities
for purchasers would incur overdraft charges for one day, to the extent they
cleared the overdraft when interests in the Global Securities were credited to
their accounts. However, interest on the Global Securities would accrue from the
value date. Therefore, the investment income on the interest in the Global
Securities earned during that one-day period would tend to offset the amount of
such overdraft charges, although this result will depend on each Clearstream,
Luxembourg Participant's or Euroclear Participant's particular cost of funds.

         Since the settlement through DTC will take place during New York
business hours, DTC Participants are subject to DTC procedures for transferring
interests in Global Securities to the respective depository of Clearstream,
Luxembourg or Euroclear for the benefit of Clearstream, Luxembourg Participants
or Euroclear Participants. The sale proceeds will be available to the DTC seller
on the settlement date. Thus, to the seller settling the sale through a DTC
Participant, a cross-market transaction will settle no differently than a sale
to a purchaser settling through a DTC Participant.

         Finally, intra-day traders that use Clearstream, Luxembourg
Participants or Euroclear Participants to purchase interests in Global
Securities from DTC Participants or sellers settling through them for delivery
to Clearstream, Luxembourg Participants or Euroclear Participants should note
that these trades will automatically fail on the sale side unless affirmative
action is taken. At least three techniques should be available to eliminate this
potential condition:

                  (a) borrowing interests in Global Securities through
         Clearstream, Luxembourg or Euroclear for one day (until the purchase
         side of the intra-day trade is reflected in the relevant Clearstream,
         Luxembourg or Euroclear accounts) in accordance with the clearing
         system's customary procedures;

                  (b) borrowing interests in Global Securities in the United
         States from a DTC Participant no later than one day prior to
         settlement, which would give sufficient time for such interests to be
         reflected in the relevant Clearstream, Luxembourg or Euroclear accounts
         in order to settle the sale side of the trade; or

                  (c) staggering the value dates for the buy and sell sides of
         the trade so that the value date for the purchase from the DTC
         Participant is at least one day prior to the value date for the sale to
         the Clearstream, Luxembourg Participant or Euroclear Participant.

         Transfers between Clearstream, Luxembourg or Euroclear seller and DTC
purchaser. Due to time zone differences in their favor, Clearstream, Luxembourg
Participants and Euroclear Participants may employ their customary procedures
for transactions in which interests in Global Securities are to be transferred
by the respective clearing system, through the respective

                                      A-1-3


depository, to a DTC Participant. The seller will send instructions to
Clearstream, Luxembourg or the Euroclear Operator through a Clearstream,
Luxembourg Participant or Euroclear Participant at least one business day prior
to settlement. Clearstream, Luxembourg or Euroclear will instruct its respective
depository to credit an interest in the Global Securities to the DTC
Participant's account against payment. Payment will include interest accrued on
the Global Securities from and including the last distribution date to but
excluding the settlement date. The payment will then be reflected in the account
of the Clearstream, Luxembourg Participant or Euroclear Participant the
following business day, and receipt of the cash proceeds in the Clearstream,
Luxembourg Participant's or Euroclear Participant's account would be back-valued
to the value date (which would be the preceding day, when settlement occurred
through DTC in New York). If settlement is not completed on the intended value
date (i.e., the trade fails), receipt of the cash proceeds in the Clearstream,
Luxembourg Participant's or Euroclear Participant's account would instead be
valued as of the actual settlement date.

CERTAIN U.S. FEDERAL INCOME TAX DOCUMENTATION REQUIREMENTS

         A Beneficial Owner of Global Securities holding securities through
Clearstream, Luxembourg or Euroclear (or through DTC if the holder has an
address outside the United States) will be subject to the 30% U.S. withholding
tax that generally applies to payments of interest (including original issue
discount) on registered debt issued by U.S. Persons, unless (i) each clearing
system, bank or other financial institution that holds customers' securities in
the ordinary course of its trade or business in the chain of intermediaries
between such Beneficial Owner and the U.S. entity required to withhold tax
complies with applicable certification requirements and (ii) such Beneficial
Owner takes one of the following steps to obtain an exemption or reduced tax
rate:

         Exemption for non-U.S. Persons (Form W-8BEN). Certificate Owners of
Global Securities that are non-U.S. Persons can obtain a complete exemption from
the withholding tax by filing a signed Form W-8BEN (Certificate of Foreign
Status of Beneficial Owner for United States Tax Withholding). Non-U.S. Persons
that are Certificate Owners residing in a country that has a tax treaty with the
United States can obtain an exemption or reduced tax rate (depending on the
treaty terms) by filing Form W-8BEN (Certificate of Foreign Status of Beneficial
Owner for United States Tax Withholding). If the information shown on Form
W-8BEN changes, a new Form W-8BEN must be filed within 30 days of such change.

         Exemption for non-U.S. Persons with effectively connected income (Form
W-8ECI). A non-U.S. Person, including a non-U.S. corporation or bank with a U.S.
branch, for which the interest income is effectively connected with its conduct
of a trade or business in the United States, can obtain an exemption from the
withholding tax by filing Form W-8ECI (Certificate of Foreign Person's Claim for
Exemption from Withholding on Income Effectively Connected with the Conduct of a
Trade or Business in the United States).

         Exemptions for U.S. Persons (Form W-9). U.S. Persons can obtain a
complete exemption from the withholding tax by filing Form W-9 (Payer's Request
for Taxpayer Identification Number and Certification),

                                      A-1-4


         U.S. Federal Income Tax Reporting Procedure. The Certificate Owner of a
Global Security files by submitting the appropriate form to the person through
whom it holds (the clearing agency, in the case of persons holding directly on
the books of the clearing agency). Form W-8BEN and Form W-8ECI are effective
until the third succeeding calendar year from the date such form is signed.

         The term "U.S. PERSON" means (i) a citizen or resident of the United
States, (ii) a corporation, partnership or other entity treated as a corporation
or partnership for United States federal income tax purposes organized in or
under the laws of the United States or any state thereof or the District of
Columbia (unless, in the case of a partnership, Treasury regulations provide
otherwise) or (iii) an estate the income of which is includible in gross income
for United States tax purposes, regardless of its source, or (iv) a trust if a
Court within the United States is able to exercise primary supervision over the
administration of the trust and one or more United States persons have authority
to control all substantial decisions of the trust. Notwithstanding the preceding
sentence, to the extent provided in Treasury regulations, certain trusts in
existence on August 20, 1996, and treated as United States persons prior to such
date, that elect to continue to be treated as United States persons will also be
a U.S. Person. This summary does not deal with all aspects of U.S. Federal
income tax withholding that may be relevant to foreign holders of the Global
Securities. Investors are advised to consult their own tax advisors for specific
tax advice concerning their holding and disposing of the Global Securities.




                                      A-1-5





                                      $[ ]
                                  (Approximate)



                    IndyMac Home Equity Loan Trust 200[ ]-[ ]



                                INDYMAC ABS, INC.
                                    Depositor




                               [INDYMAC BANK LOGO]
                           Seller and Master Servicer




                           Revolving Home Equity Loan
                  Asset Backed Certificates, Series 200[ ]-[ ]



                              ---------------------
                              PROSPECTUS SUPPLEMENT
                              ---------------------




                                  [UNDERWRITER]


         You should rely only on the information contained or incorporated by
reference in this prospectus supplement and the accompanying prospectus. We have
not authorized anyone to provide you with different information.

         We are not offering the Series 200[ ]-[ ] Home Equity Loan Asset Backed
Certificates in any state where the offer is not permitted.

         Dealers will deliver a prospectus supplement and prospectus when acting
as underwriters of the Series 200[ ]-[ ] Home Equity Loan Asset Backed
Certificates and with respect to their unsold allotments or subscriptions. In
addition, all dealers selling the Series 200[ ]-[ ] Home Equity Loan Asset
Backed Certificates will be required to deliver a prospectus supplement and
prospectus until [ ], 200[ ].


                               [          ], 200[ ]

                 SUBJECT TO COMPLETION DATED SEPTEMBER 10, 2004

PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED [         ], 200[  ])

                               $[               ]
                                  (APPROXIMATE)
                                INDYMAC ABS, INC.
                                    DEPOSITOR

                             [LOGO OF INDYMAC BANK]
                           SELLER AND MASTER SERVICER

                    INDYMAC HOME EQUITY LOAN TRUST 200[ ]-[ ]
                                SERIES 200[ ]-[ ]
                                     ISSUER

[RED HERRING]
The information in this prospectus supplement is not complete and may be
changed. We may not sell these securities until the registration statement filed
with the Securities and Exchange Commission is effective. This prospectus
supplement is not an offer to sell these securities and we are not soliciting
offers to buy these securities in any state where the offer or sale is not
permitted. [END RED HERRING]


                                    THE NOTES
                                            The Class [ ] [and Class [ ]]notes
                                    have [an] original principal balance[s] of
                                    $[ ] [and $[ ], respectively, each] subject
                                    to a permitted variance of plus or minus
                                    [5]%.



                                    -------------------------------------------------------------------------------------------
                                                                                                   UNDERWRITING
                                                     APPROXIMATE         PASS-                       DISCOUNT       PROCEEDS
                                                      PRINCIPAL         THROUGH        PRICE TO         AND            TO
                                                     AMOUNT(1)`          RATE           PUBLIC      COMMISSIONS   COMPANY (2)
                                                     ---------           ----           ------      -----------   ----------
                                    -------------------------------------------------------------------------------------------

                                      [      ]        [      ]         [      ]%      [      ]%      [      ]%     [      ]%
                                    -------------------------------------------------------------------------------------------
                                      [      ]        [      ]         [      ]%      [      ]%      [      ]%     [      ]%
                                    -------------------------------------------------------------------------------------------

                                    (1) Subject to a permitted variance in the aggregate of [10]%.
                                    (2) Before deducting expenses.


--------------------------          THE TRUST FUND

CONSIDER CAREFULLY                          The notes will be secured by the
THE RISK FACTORS                    trust fund consisting primarily of [two]
BEGINNING ON PAGE                   loan groups of home equity revolving credit
[S-12] IN THIS                      line loans made or to be made in the future
PROSPECTUS                          under certain home equity revolving credit
SUPPLEMENT AND ON                   line loan agreements. The loans will be
PAGE [3] IN THE                     secured by first or second deeds of trust or
PROSPECTUS.                         mortgages on [one- to four-family]
                                    residential properties and will bear
The notes represent                 interest at rates that adjust based on [the
non-recourse                        prime rate]. [The trust fund will also
obligations of the                  initially include funds from the sale of the
trust only and do not               notes in excess of the cut-off date
represent an interest               principal balances. These excess funds are
in or obligation of                 expected to be used to acquire additional
IndyMac ABS, Inc.,                  home equity revolving credit line loans
IndyMac Bank,                       after the cut-off date.] The Class [ ] notes
F.S.B. or any of                    will represent an interest in loan group [ ]
their affiliates.                   only.]

This prospectus                     THE POLICY
supplement may be                           [Note Insurer] will issue an
used to offer and                   irrevocable and unconditional note guaranty
sell the notes only if              insurance policy which will guarantee
accompanied by the                  certain payments to noteholders.
prospectus.

--------------------------
                               [NOTE INSURER LOGO]

     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 PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

         [Underwriter] will offer the notes subject to prior sale and subject to
its right to reject orders in whole or in part. The notes will be issued in
book-entry form on or about [ ], 200[ ] [and will be offered in the United
States and Europe].

                                  [UNDERWRITER]

[         ], 200[  ]







                                TABLE OF CONTENTS



              PROSPECTUS SUPPLEMENT
              ---------------------
                                                 PAGE
                                                 ----

Summary...........................................S-3
Risk Factors.....................................S-12
The Trust........................................S-19
The Note Insurer.................................S-21
The Master Servicer..............................S-22
The Home Equity Loan Program.....................S-23
Description of the Mortgage Loans................S-25
Maturity and Prepayment Considerations...........S-50
Pool Factor......................................S-52
Description of the Notes.........................S-53
Description of the Indenture.....................S-65
Description of the Sale and Servicing Agreement..S-78
Description of the Purchase Agreement............S-89
Use of Proceeds..................................S-90
Material Federal Income Tax Consequences.........S-90
State Taxes......................................S-94
ERISA Considerations.............................S-94
Legal Investment Considerations..................S-96
Underwriting.....................................S-97
Legal Matters....................................S-97
Experts..........................................S-97
Ratings..........................................S-98
Index of Defined Terms...........................S-99
Annex I.........................................A-I-1

PROSPECTUS
                                                 PAGE
                                                 ----
Important Notice About Information in This
   Prospectus and Each Accompanying Prospectus
   Supplement.......................................2
Risk Factors........................................3
The Trust Fund.....................................13
Use of Proceeds....................................19
The Depositor......................................19
Loan Program.......................................20
Description of the Securities......................22
Credit Enhancement.................................36
Yield and Prepayment Considerations................40
The Agreements.....................................42
Certain Legal Aspects of the Loans.................56
Federal Income Tax
Consequences.......................................69
State Tax Considerations...........................89
ERISA Considerations...............................89
Legal Investment...................................94
Method of Distribution.............................94
Legal Matters......................................95
Financial Information..............................95
Rating.............................................95
Index to Defined Terms.............................96



         Dealers will deliver a prospectus supplement and prospectus when acting
as underwriters of the Series [ ] Notes and with respect to their unsold
allotments or subscriptions. In addition, all dealers selling the Series [ ]
Notes will be required to deliver a prospectus supplement and prospectus until
90 days after the date of this prospectus supplement.

         You should rely on the information contained in this document or to
which we have referred you. We have not authorized anyone to provide you with
information that is different. This document may only be used where it is legal
to sell these securities. The information in this document may only be accurate
on the date of this document.


                                      S-2




                                     SUMMARY

o    This summary highlights selected information from this document and does
     not contain all of the information that you need to consider in making your
     investment decision. To understand all of the terms of an offering of the
     notes, carefully read this entire document and the accompanying prospectus.

o    Certain statements contained in or incorporated by reference in this
     prospectus supplement and the accompanying prospectus consist of
     forward-looking statements relating to future economic performance or
     projections and other financial items. These statements can be identified
     by the use of forward-looking words such as "may," "will," "should,"
     "expects," "believes," "anticipates," "estimates," or other comparable
     words. Forward-looking statements are subject to a variety of risks and
     uncertainties that could cause actual results to differ from the projected
     results. Those risks and uncertainties include, among others, general
     economic and business conditions, regulatory initiatives and compliance
     with governmental regulations, customer preferences and various other
     matters, many of which are beyond our control. Because we cannot predict
     the future, what actually happens may be very different from what we
     predict in our forward-looking statements.


TRUST FUND

IndyMac Home Equity Loan Trust 200[ ]-[ ]. The trust fund will own a pool of
home equity revolving credit line loans made or to be made in the future under
certain home equity revolving credit line loan agreements. The loans will be
secured by first or second deeds of trust or mortgages on primarily one- to
four-family residential properties and will bear interest at rates that adjust
based on the prime rate. We sometimes refer to these loans as home equity loans
or mortgage loans. [The original principal balance of the notes will exceed the
aggregate cut-off date principal balances of the home equity loans initially
transferred to the trust fund. Funds in an amount equal to this excess are
expected to be used to acquire additional home equity loans that are not
included in the cut-off date pool. Until they are so used, they will be held in
the trust fund.]

We will be dividing the mortgage loans in the trust fund into [two] groups. Each
will be referred to as a loan group. The repayment of the Class [ ] Notes will
be secured by a security interest in loan group [ ] and the repayment of the
Class [ ] Notes will be secured by a security interest in loan group [ ].
Likewise, holders of Class [ ] Notes will receive payments from collections on
mortgage loans in loan group [ ] and holders of Class [ ] Notes will receive
payments from collections on mortgage loans in loan group [ ].

[THE OFFERED NOTES

IndyMac Home Equity Loan Trust 200[ ]-[ ] will issue [ ] classes of Home Equity
Loan Asset Backed Notes and a transferor's interest. Only the Class [ ] Notes
are offered by this prospectus supplement and the accompanying prospectus and
are listed on the cover page of this prospectus supplement.]

                                      S-3


[OTHER NOTES

IndyMac Home Equity Loan Trust 200[ ]-[ ] is also issuing the Class [ ] Notes
and the transferor's interest. As described in this prospectus supplement,
except for limited cross-collateralization, the Class [ ] Notes are not
supported by the mortgage loans in loan group [ ], the group that supports the
offered notes. As described in this prospectus supplement, a portion of the
transferor's interest is subordinated in right of payment to the payment of the
notes. Information regarding the Class [ ] Notes and the transferor's interest
is included in this prospectus supplement chiefly to provide you with a better
understanding of the Class [ ] Notes.]

DEPOSITOR

IndyMac ABS, Inc., a Delaware corporation, is a limited purpose finance
subsidiary of IndyMac Bank, F.S.B. Its address is 155 North Lake Avenue,
Pasadena, California 91101, and its telephone number is (800) 669-2300.

See "The Depositor" in the prospectus.

SELLER AND MASTER SERVICER

[IndyMac Bank, F.S.B.]

See "The Master Servicer" in this prospectus supplement.

INDENTURE TRUSTEE

[Name of Indenture Trustee].

OWNER TRUSTEE

[Name of Owner Trustee].

NOTE INSURER

[Note Insurer][, will insure the [Class [ ]] Notes as described in this
prospectus supplement].

See "The Note Insurer" in this prospectus supplement.

INDENTURE

The notes will be issued pursuant to an indenture between the trust and the
indenture trustee.

CUT-OFF DATE

[         ], 200[  ].

CLOSING DATE

On or about [         ], 200[  ].

PAYMENT DATES

The indenture trustee will make distributions on the [ ] day of each calendar
month beginning in [ ] 200[ ]. If the [ ] day of a month is not a business day,
then payments will be made on the next business day after the [ ] day of the
month.

RECORD DATE

The [last] day preceding a payment date or, if the notes are no longer
book-entry notes, the last day of the month preceding a payment date.

DENOMINATIONS

[The Class [ ] Notes will be issued in minimum denominations of] $[25,000] and
multiples in excess of that.

                                      S-4


REGISTRATION OF NOTES

The [Class [ ]] Notes will initially be issued in book-entry form. Persons
acquiring beneficial ownership interests in the [Class [ ]] Notes may elect to
hold their beneficial interests through The Depository Trust Company, in the
United States, or Clearstream, Luxembourg or the Euroclear System, in Europe.

See "Description of Notes -- Book-Entry Notes" in this prospectus supplement.

THE MORTGAGE LOANS

General

The mortgage loans are revolving lines of credit. During the applicable draw
period, each borrower may borrow additional amounts from time to time up to the
maximum amount of that borrower's line of credit. If borrowed amounts are
repaid, they may again be borrowed during the applicable draw period.

The pool balance equals the aggregate of the principal balances of all mortgage
loans in [both] loan groups. The loan group balance of a loan group equals the
aggregate of the principal balances of all mortgage loans in that loan group.
The principal balance of a mortgage loan (other than a liquidated mortgage loan)
on any day is equal to

o    its cut-off date principal balance,

     plus

o    any additional borrowings on that mortgage loan,

     minus

o    all collections credited against the principal balance of that mortgage
     loan before that day.

Once a mortgage loan is liquidated, its principal balance will be zero.

Loan Rate

Interest on each mortgage loan is payable monthly and computed on the related
daily outstanding principal balance for each day in the billing cycle. The loan
rate is a variable rate per annum equal to the sum of

o    the highest prime rate published in the Money Rates table of The Wall
     Street Journal as of the first business day of each calendar month

     and

o    a margin.

Each loan rate is subject to applicable usury limits and certain maximum rates.
Loan rates are adjusted monthly on the first business day of the calendar month
preceding the due date. The due date for each mortgage loan is the [fifteenth]
day of each month.

Principal Payments

Each home equity loan features a draw period during which the loan may be drawn
on, immediately followed by a repayment period during which the loan must be
repaid. In general, home equity loans with [ ]-year draw periods have [ ]-year
repayment periods. These [ ]-year draw periods are generally extendible for an
additional [ ] years with the approval of the master servicer.

                                      S-5


Statistical Calculation Date Information

The statistical information presented in this prospectus supplement concerning
the pool of mortgage loans does not reflect all of the mortgage loans that will
be included in the pool on the closing date. The statistical calculation
information presented in this prospectus supplement relates to a statistical
calculation pool that comprises approximately [ ]% of the mortgage loans that
will be included in the trust fund. The aggregate principal balance of each
statistical calculation loan group as of the statistical calculation date is the
statistical calculation loan group balance. The statistical calculation date is
[ ], 200[ ].

Unless otherwise noted, all statistical percentages in this prospectus
supplement are measured by the aggregate principal balance of the applicable
statistical calculation loan group on the statistical calculation date.

See "Description of the Mortgage Loans" in this prospectus supplement for
additional information concerning the statistical calculation pool and the
mortgage loans in general.

THE [CLASS [    ]] NOTES

Note Rate

                                [Class [ ] Notes]

The note rate on the Class [ ] Notes may change from payment date to payment
date. On any payment date the note rate for the [Class [ ]] Notes will equal
[the least of]:

o    LIBOR plus [    ]% per annum,

o    [the weighted average of the loan rates on the mortgage loans in loan group
     [ ] minus certain fees, expenses and minimum spread requirements, and

o    [    ]% per annum.]

[However, on any payment date for which the note rate for the Class [ ] Notes
has been determined pursuant to the weighted average of the net loan rates on
the mortgage loans in loan group [ ], the excess of the lesser of

o    [    ]% per annum and

o    LIBOR + [    ]% per annum

over the note rate will be paid (with interest at the rate of LIBOR + [ ]% per
annum, but not at a rate in excess of [ ]% per annum) on the Class [ ] Notes on
subsequent payment dates to the extent that funds are available in the priority
described in this prospectus supplement.]

                                [Class [ ] Notes

The note rate on the Class [ ] Notes may change from payment date to payment
date. On any payment date the note rate for the Class [ ] Notes will equal [the
least of]:

o    LIBOR plus [   ]% per annum,

o    [the weighted average of the loan rates on the mortgage loans in loan group
     [ ] minus certain fees, expenses and minimum spread requirements, and

o    [    ]% per annum.]

[However, on any payment date for which the note rate for the Class [ ] Notes
has been determined pursuant to the weighted


                                      S-6




average of the net loan rates on the mortgage loans in loan group [ ], the
excess of the lesser of

o    [    ]% per annum and

o    LIBOR + [    ]% per annum

over the note rate will be paid (with interest at the rate of LIBOR + [ ]% per
annum, but not at a rate in excess of [ ]% per annum) on the Class [ ] Notes on
subsequent payment dates to the extent that funds are available in the priority
described in this prospectus supplement.]] The insurance policy issued by [ ]
does not cover payment of basis risk carryforward.

See "Description of the Notes -- Payments on the Notes -- Application of
Interest Collections" in this prospectus supplement.

Interest Period

For each payment date and class of notes, the period beginning on the prior
payment date (or in the case of the first payment date, beginning on the closing
date) and ending on the day before the applicable payment date. The indenture
trustee will calculate interest based on the actual number of days in the
interest period and a year assumed to consist of 360 days.

Original Note Principal Balance

The original principal balance of [either] class of notes may be reduced or
increased by not more than [5]% depending on the aggregate principal balance of
the mortgage loans in the related loan group actually delivered on the closing
date.

Principal

The amount of principal paid on a class of notes on a payment date will depend
on whether the payment date occurs during the managed amortization period or the
rapid amortization period.

The managed amortization period begins on the closing date and ends on the
earlier of

o    the payment date in [         ] and

o    the date on which a rapid amortization event first occurs.

The rapid amortization period begins on the first payment date after the end of
the managed amortization period.

See "Description of Notes -- Payments on the Notes -- Distributions of Principal
Collections" in this prospectus supplement.

[ADDITIONAL LOAN ACCOUNT

On the closing date approximately $[ ] will be deposited into an additional loan
account [for loan group [ ] and approximately $[ ] will be deposited into an
additional loan account for loan group [ ], each] held as a part of the trust
fund. These funds represent the excess of the original principal balance of the
Class [ ] [and Class [ ]] Notes [,as applicable,] over the cut-off date
principal balance of the mortgage loans in [their related] loan group [ ]
initially transferred to the trust fund. These funds are expected to be used
through [ ] to acquire additional home equity loans that are not included in the
cut-off date pool. Any additional home equity loans acquired by the trust fund
after the cut-off date will have been underwritten using


                                      S-7




generally the same guidelines as were used to select the initial mortgage loans
in the trust fund, and the trust fund will have the benefit of substantially the
same representations and warranties covering the initial mortgage loans in the
trust fund. The purchase of these additional home equity loans is in addition to
the ongoing purchase of additional balances during the managed amortization
period with the proceeds of principal repayments received on the trust fund's
mortgage loan portfolio. Any funds remaining in the additional loan account[s]
on [ ] will be used to prepay the [Class [ ]] [related class of] Notes on the
first payment date following such date.]

TERMINATION

The trust fund will terminate on the payment date following the later of

A. payment in full of all amounts owing to the note insurer [and any third party
   credit enhancer] and

B. the earliest of

   o    the payment date on which the principal balance of [both] classes of
        notes have been reduced to zero,

   o    the final payment or other liquidation of the last mortgage loan in the
        trust fund,

   o    the optional transfer of the mortgage loans to the owner of the
        transferor interest, as described below, and

   o    the payment date in [         ].

The mortgage loans in the trust fund will be subject to optional transfer to the
owner of the transferor interest on any payment date on or after which

o    the aggregate principal balance of the mortgage loans is reduced to any
     amount less than or equal to [10]% of the sum of the aggregate original
     principal balance of the initial mortgage loans as of the initial cut-off
     date and the aggregate original principal balance of any additional home
     equity loans as of the respective cut-off dates, and

o    all amounts due and owing to the note insurer [and any third party credit
     enhancer], including any unreimbursed draws on the policy [and any third
     party enhancement], together with interest on those amounts, have been paid
     as provided [either] in the insurance agreement under which the policy is
     issued [or in accordance with any third party credit enhancement].

See "Description of the Indenture -- Termination; Retirement of the Notes" in
this prospectus supplement and "The Agreements -- Termination; Optional
Termination" in the prospectus.

CREDIT ENHANCEMENT

General

The trust fund includes various mechanisms that are intended to protect
noteholders against losses on the mortgage loans.

Excess Interest

The indenture trustee will distribute certain interest collections on the
mortgage loans in each loan group to cover losses that would otherwise be
allocated to the notes related to that loan group, and to the extent described
in this prospectus supplement, to the notes related to the other loan group.

                                      S-8


Limited Subordination of Transferor Interest

The sum of the amounts by which the loan group balance of each loan group in the
trust fund exceeds the principal balance of its related notes is the transferor
interest. Initially, the transferor interest will be $[__]. The transferor
interest is expected to grow as interest collections in excess of trustee fees,
amounts due the note insurer, interest accrued on the notes and certain loss
amounts due on the notes are applied as principal payments on the notes, thereby
creating overcollateralization of the notes. For each loan group, once the
required level of overcollateralization is reached, the acceleration feature for
the related class of notes will cease, unless it is necessary to maintain the
required level of overcollateralization. The transferor interest is also the
mechanism that absorbs changes in the principal amount of mortgage loans in a
loan group due to new borrowings and repayments. In certain circumstances,
amounts that would be distributed on the transferor interest will instead be
distributed on the notes. IndyMac Bank, F.S.B. (or one of its affiliates) will
be the owner of the transferor interest on the closing date.

See "Description of the Notes -- Limited Subordination of Transferor Interest"
in this prospectus supplement.

Policy

The policy will irrevocably and unconditionally guarantee on each payment date
to the indenture trustee for the benefit of the noteholders the full and
complete payment of the guaranteed distributions consisting of

o     the guaranteed principal distribution amount with respect to the notes
      for the payment date, and

o     accrued and unpaid interest due on the notes.

The effect of the policy is to guarantee the timely payment of interest on, and
the ultimate payment of the principal amount of, the notes. The policy does not
cover payment of basis risk carryforward.

In addition, the policy will guarantee the payment of the outstanding note
principal balance on the payment date in [ ] (after giving effect to all other
amounts distributable and allocable to principal on that payment date).

IN THE ABSENCE OF PAYMENTS UNDER THE POLICY, NOTEHOLDERS WILL DIRECTLY BEAR THE
CREDIT AND OTHER RISKS ASSOCIATED WITH THEIR PERCENTAGE INTEREST IN THE TRUST
FUND.

See "Description of the Indenture -- The Policy" in this prospectus supplement.

[Limited Cross-collateralization

The indenture will allow for limited cross-collateralization, in that certain
excess cashflows from either loan group on any payment date will be applied to
the funding of certain deficiencies in interest and principal on the notes
related to the other loan group.]

[Reserve Fund

On the closing date, an account will be set up in the name of the indenture
trustee on behalf of the noteholders, but will not be funded. Once the required
level of

                                      S-9




overcollateralization for a loan group has been reached, excess
cashflow from that loan group may be deposited in the reserve fund on future
payment dates until the amount reaches a specified level. Amounts in the reserve
fund may be used to cover shortfalls in amounts required to be distributed as
interest to either Class of Class [ ] Notes or to cover losses on the mortgage
loans in either loan group.]

TAX STATUS

Subject to the qualifications described under "Material Federal Income Tax
Consequences" in this prospectus supplement, Sidley Austin Brown & Wood LLP,
special tax counsel to the depositor, is of the opinion that, under existing
law, a note will be treated as a debt instrument for federal income tax purposes
as of the closing date. Furthermore, special tax counsel to the depositor is of
the opinion that neither the trust fund nor any portion of the trust fund will
be treated as a corporation, a publicly traded partnership taxable as a
corporation or a taxable mortgage pool.

See "Material Federal Income Tax Consequences" in this prospectus supplement and
"Federal Income Tax Consequences" in the prospectus for additional information
concerning the application of federal income tax laws.


ERISA CONSIDERATIONS

Generally, the notes may be purchased by a pension, employee benefit or other
plan subject to the Employee Retirement Income Security Act of 1974, as amended
or Section 4975 of the Internal Revenue Code of 1986 as amended, or by an entity
investing the assets of such a plan, so long as certain conditions are met. A
fiduciary of an employee benefit or other plan or an individual retirement
account must determine that the purchase of a note is consistent with its
fiduciary duties under applicable law and does not result in a non-exempt
prohibited transaction under applicable law. Any person who acquires a note on
behalf of or with plan assets of an employee benefit or other plan subject to
ERISA or Section 4975 of the Code will be deemed to make certain
representations.

See "ERISA Considerations" in this prospectus supplement and in the prospectus.

LEGAL INVESTMENT CONSIDERATIONS

The [Class [ ]] Notes will not constitute mortgage related securities for
purposes of the Secondary Mortgage Market Enhancement Act of 1984, because not
all of the mortgages securing the loans are first mortgages. Accordingly, many
institutions with legal authority to invest in comparably rated securities based
solely on first mortgages may not be legally authorized to invest in the [Class
[ ]] Notes.

See "Legal Investment" in the prospectus.

                                      S-10


NOTE RATING

The notes will not be offered unless they are each rated [ ] by [Rating Agency]
and [ ] by [Rating Agency]. A rating is not a recommendation to buy, sell or
hold securities. These ratings may be lowered or withdrawn at any time by either
of the rating agencies.

See "Ratings" in this prospectus supplement and "Risk Factors - Rating of the
Securities Does Not Assure their Payment" and "Rating" in the prospectus.

                                      S-11








                                                        RISK FACTORS

o    The following information, which you should carefully consider, identifies
     certain significant sources of risk associated with an investment in the
     notes. You should also carefully consider the information set forth under
     "Risk Factors" in the prospectus.




YOU MAY HAVE DIFFICULTY SELLING                    The underwriter intends to make a secondary market in the notes purchased
     YOUR NOTES...........................         by it, but has no obligation to do so. We cannot assure you that
                                                   a secondary market will develop or, if it develops, that it will continue.
                                                   Consequently, you may not be able to sell your notes readily or at prices
                                                   that will enable you to realize your desired yield. The market values of
                                                   the notes are likely to fluctuate; these fluctuations may be significant
                                                   and could result in significant losses to you.

                                                   The secondary markets for mortgage backed and asset backed securities have
                                                   experienced periods of illiquidity and can be expected to do so in the
                                                   future. Illiquidity can have a severely adverse effect on the prices of
                                                   securities that are especially sensitive to prepayment, credit, or interest
                                                   rate risk, or that have been structured to meet the investment requirements
                                                   of limited categories of investors.

CASH FLOW DISRUPTIONS COULD CAUSE PAYMENT          Substantial delays and shortfalls could result from liquidating
     DELAYS AND LOSSES....................         delinquent mortgage loans. Resulting shortfalls in distributions
                                                   to noteholders could occur if the note insurer were unable to perform its
                                                   obligations under the policy. Further, liquidation expenses (such as legal
                                                   fees, real estate taxes, and maintenance and preservation expenses) will
                                                   reduce the security for the related mortgage loans and in turn reduce the
                                                   proceeds payable to noteholders. If any of the mortgaged properties fail
                                                   to provide adequate security for the related mortgage loans, you could
                                                   experience a loss if the note insurer were unable to perform its
                                                   obligations under the policy.

YIELD AND REINVESTMENT MAY BE ADVERSELY
     AFFECTED BY UNPREDICTABILITY OF               During the period that a borrower may borrow money under the
     PREPAYMENTS..........................         borrower's line of credit, the borrower may make monthly payments
                                                   only for the accrued interest or may also repay some or all of the amount
                                                   previously borrowed. In addition, borrowers may borrow additional amounts
                                                   up to the maximum amounts of their lines of credit. As a result, the
                                                   amount the master



                                          S-12





                                                   servicer receives in any month (and in turn the amount
                                                   distributed to the holders of the related class of notes) may change
                                                   significantly. Even during the repayment period, borrowers generally may
                                                   prepay their mortgage loans at any time without penalty. [However,
                                                   prepayments on loans secured by property in California and certain other
                                                   jurisdictions may be subject to account termination fees during the first
                                                   five years after origination of the loan.] Generally, revolving home
                                                   equity loans are not viewed by borrowers as permanent financing. The
                                                   mortgage loans may be repaid at faster rates than traditional mortgage
                                                   loans. The trust fund's prepayment experience may be affected by a wide
                                                   variety of factors, including:

                                                   o        general economic conditions,

                                                   o        interest rates,

                                                   o        the availability of alternative financing and

                                                   o        homeowner mobility.

                                                   In addition, substantially all of the mortgage loans contain due-on-sale
                                                   provisions and the master servicer intends to enforce those provisions
                                                   unless doing so is not permitted by applicable law or the master servicer
                                                   permits the purchaser of the mortgaged property in question to assume the
                                                   mortgage loan in a manner consistent with reasonable commercial practice.
                                                   See "Description of the Notes" in this prospectus supplement and "Certain
                                                   Legal Aspects of the Loans -- Due-on-Sale Clauses" in the prospectus for a
                                                   description of certain provisions of the credit line agreements that may
                                                   affect the prepayment experience on the mortgage loans.

                                                   The yield to maturity and weighted average life of your notes will be
                                                   affected primarily by

                                                   o        the rate and timing of repayments and prepayments on the mortgage
                                                            loans in your loan group as compared with the creation and
                                                            amount of additional balances and

                                                   o        the realization of liquidation loss amounts.

                                                   You bear the reinvestment risks resulting from a faster or slower rate of
                                                   principal payments than you expected. [You also bear the reinvestment risk
                                                   if by [ ] all of the funds in the additional loan account[s] have



                                               S-13




                                                  not been used to acquire additional home equity loans, which would result
                                                   in a prepayment of [each class of] [the Class [ ]] Notes in an amount
                                                   equal to the amount remaining in [its related] [the] additional loan
                                                   account on that date]. See "Maturity and Prepayment Considerations" in
                                                   this prospectus supplement and "Yield and Prepayment Considerations" in
                                                   the prospectus.

WITHDRAWAL OR DOWNGRADING OF INITIAL               The rating of the notes will depend primarily on an assessment by
     RATINGS WILL AFFECT THE VALUE OF THE          the rating agencies of the mortgage loans and upon the financial
     NOTES................................         strength of the note insurer. Any reduction in a rating assigned
                                                   to the financial strength of the note insurer may result in a reduction in
                                                   the rating of the notes. A reduction in the rating assigned to the notes
                                                   probably would reduce the market value of the notes and may affect your
                                                   ability to sell them.

                                                   The rating by each of the rating agencies of the notes is not a
                                                   recommendation to purchase, hold or sell the notes since that rating does
                                                   not address the market price or suitability for a particular investor. The
                                                   rating agencies may reduce or withdraw the ratings on the notes at any time
                                                   they deem appropriate. In general, the ratings address credit risk and do
                                                   not address the likelihood of prepayments.

JUNIOR LIEN PRIORITY COULD RESULT IN               The mortgage loans are secured by mortgages that generally are
     PAYMENT DELAY OR LOSS................         second mortgages. The master servicer has the power under certain
                                                   circumstances to consent to a new mortgage lien on the mortgaged property
                                                   having priority over the mortgage loan in the trust fund. Mortgage loans
                                                   secured by second mortgages are entitled to proceeds that remain from the
                                                   sale of the related mortgaged property after any related senior mortgage
                                                   loan and prior statutory liens have been satisfied. If the remaining
                                                   proceeds are insufficient to satisfy the mortgage loans secured by second
                                                   mortgages and prior liens in the aggregate and the note insurer is unable
                                                   to perform its obligations under the policy, you will bear

                                                   o    the risk of delay in payments while any deficiency judgment against
                                                        the borrower is sought and

                                                   o    the risk of loss if the deficiency judgment cannot be
                                                        obtained or is not realized on.



                                             S-14





                                                   See "Certain Legal Aspects of the Loans" in the prospectus.

DISTRIBUTIONS TO AND RIGHTS OF INVESTORS           [The seller] will treat its sale of the mortgage loans to the
     COULD BE ADVERSELY AFFECTED BY THE            depositor as a sale of the mortgage loans. [However, in the event
     BANKRUPTCY OR INSOLVENCY OF CERTAIN           of insolvency of [IndyMac Bank, F.S.B.], the Federal Deposit
     PARTIES..............................         Insurance Corporation (referred to as the FDIC) as conservator or
                                                   receiver, could attempt to recharacterize the sale of the mortgage loans
                                                   to the depositor as a borrowing secured by a pledge of the mortgage loans.
                                                   If such an attempt to recharacterize the transfer of the mortgage loans
                                                   were successful, the FDIC could elect to accelerate payments on the notes
                                                   and liquidate the mortgage loans with the holders of the notes entitled to
                                                   no more than the outstanding principal balances, if any, of the classes of
                                                   notes, together with interest thereon at the applicable note rate. In the
                                                   event of the acceleration of the notes, the holders of the notes would
                                                   lose the right to future payments of interest, might suffer reinvestment
                                                   losses in a lower interest rate environment and may fail to recover their
                                                   initial investment. Further, with respect to an acceleration by the FDIC,
                                                   interest may be payable only through the date of the appointment of the
                                                   FDIC as conservator or receiver. The FDIC has a reasonable period of time
                                                   (which it has stated will generally not exceed 180 days after the date of
                                                   its appointment) to elect to accelerate payment. Whether or not an
                                                   acceleration takes place, delays in payment in the notes and possible
                                                   reductions in the amount of such payments could occur]. [In the event of
                                                   [the Seller's] bankruptcy, the trustee in bankruptcy of [the Seller] may
                                                   argue that the mortgage loans were not sold but were only pledged to
                                                   secure a loan to [the Seller]. If that argument is made you could
                                                   experience delays or reductions in payments on the notes.] The depositor
                                                   will warrant in the sale and servicing agreement that the transfer of the
                                                   mortgage loans by it to the trust fund is either a valid transfer and
                                                   assignment of the mortgage loans to the trust fund or the grant to the
                                                   trust fund of a security interest in the mortgage loans.

                                                   If certain events relating to the bankruptcy or insolvency of the
                                                   transferor were to occur, [no further additional home equity loans would
                                                   be acquired with any funds remaining in the additional loan account,]
                                                   additional balances would not be sold to the trust fund,



                                      S-15




                                                   and the rapid amortization period would commence.

                                                   If the master servicer becomes bankrupt, [the bankruptcy trustee or
                                                   receiver][FDIC] may have the power to prevent the appointment of a
                                                   successor master servicer.

                                                   o    any purchaser of a mortgage loan who had no notice of the prior
                                                        conveyance to the trust fund if the purchaser perfects his interest
                                                        in the mortgage loan by taking possession of the related documents or
                                                        other evidence of indebtedness or otherwise.

                                                   In those events, the trust fund would be an unsecured creditor of IndyMac
                                                   Bank, F.S.B.

DEVELOPMENTS IN [CALIFORNIA] COULD HAVE            Approximately [ ]% of the mortgage loans in statistical calculation loan
     DISPROPORTIONATE EFFECT ON THE POOL           group [ ] and approximately [ ]% of the mortgage loans in statistical
     OF MORTGAGE LOANS DUE TO GEOGRAPHIC           calculation loan group [ ] are secured by mortgaged properties located in
     CONCENTRATION OF MORTGAGED                    the State of [California]. After the statistical calculation date, the
     PROPERTIES...........................         geographic concentration could change because of the addition or removal
                                                   of mortgage loans, prepayments or the creation of additional balances.
                                                   Property in [California] may be more susceptible than homes located in
                                                   other parts of the country to certain types of uninsurable hazards, such
                                                   as earthquakes, floods, mudslides and other natural disasters. In
                                                   addition:

                                                   o    economic conditions in [California] (which may or may not affect real
                                                        property values) may affect the ability of borrowers to repay their
                                                        loans on time;

                                                   o    declines in the [California] residential real estate market may
                                                        reduce the values of properties located in [California], which would
                                                        result in an increase in the loan-to-value ratios; and

                                                   o    any increase in the market value of properties located in
                                                        [California] would reduce the loan-to-value ratios and could,
                                                        therefore, make alternative sources of financing available to the
                                                        borrowers at lower interest rates, which could result in an increased
                                                        rate of prepayment of the mortgage loans.

MASTER SERVICER HAS ABILITY TO CHANGE THE
     TERMS OF THE MORTGAGE LOANS..........         The master servicer may agree to changes in the terms of a credit
                                                   line agreement if the changes




                                          S-16





                                                  o    do not materially and adversely affect the interest of
                                                        the related noteholders[, any third party credit enhancer]
                                                        or the note insurer, and

                                                   o    are consistent with prudent business practice.

                                                   In addition, the master servicer, within certain limitations, may increase
                                                   the credit limit related to a mortgage loan or reduce the loan rate for a
                                                   mortgage loan. Any increase in the credit limit related to a mortgage loan
                                                   would increase the combined loan-to-value ratio of that mortgage loan and,
                                                   accordingly, may increase the likelihood and would increase the severity of
                                                   loss if a default occurs under the mortgage loan. In addition, any
                                                   reduction in the loan rate of a mortgage loan would reduce the related loan
                                                   group's excess cash flow available to absorb losses.

YOUR RETURN COULD BE ADVERSELY AFFECTED
     BY DELINQUENT MORTGAGE LOANS.........         The trust fund may include mortgage loans that are 59 or fewer
                                                   days delinquent as of [               ] (the cut-off date for the
                                                   pool of mortgage loans). We expect that the principal balance of
                                                   mortgage loans that are between 30 days and 59 days delinquent as
                                                   of the cut-off date will not exceed approximately $[      ].
                                                   Mortgage loans that are already delinquent may increase the risk
                                                   that the trust fund will experience a loss if

                                                   o    the investor interest collections are not sufficient to
                                                        cover the investor loss amounts for any payment date,

                                                   o    amounts intended to provide protection for the notes
                                                        that are otherwise payable to the owner of the transferor
                                                        interest have been exhausted and

                                                   o    the note insurer fails to perform its obligations under
                                                        the policy.

EFFECT OF LOAN RATES ON THE                        The notes accrue interest at a rate based on the one-month LIBOR
     NOTES................................         index plus a specified margin, but are subject to a cap [based in
                                                   part on the interest rates on
                                                   the mortgage loans].

                                                   The mortgage loans have interest rates that are based on the [Index], and
                                                   have periodic and maximum limitations on adjustments to the loan rate. As
                                                   a result,





                                              S-17






                                                   the notes may accrue less interest than they would accrue if the note rate
                                                   were based solely on the LIBOR index plus the specified margin.

                                                   A variety of factors could affect the interest rates on the mortgage loans
                                                   and thus limit the note rate. Some of these factors are described below:

                                                   o    Each note rate adjusts [monthly] while the loan rates on the mortgage
                                                        loans may adjust less frequently. Consequently, the loan rates may
                                                        limit increases in one or both note rates for extended periods in a
                                                        rising interest rate environment.

                                                   o    The [Index] may respond to different economic and market factors than
                                                        LIBOR and thus may increase or decrease at different times. As a
                                                        result, the loan rates could decline while LIBOR is stable or rising.
                                                        And although both the loan rates and LIBOR may either decline or
                                                        increase during the same period, the loan rates could decline more
                                                        rapidly or increase more slowly than LIBOR.

                                                   These factors may adversely affect the yield to maturity on the notes. Any
                                                   basis risk carryforward will be paid on the notes only to the extent of
                                                   available funds as described in this prospectus supplement. We cannot
                                                   assure you that all basis risk carryforward will be paid. [In addition,
                                                   the policy does not cover, and the ratings of the notes do not address the
                                                   likelihood of, the payment of basis risk carryforward.]

[CERTAIN RIGHTS MAY BE AFFECTED BY THE
     ISSUANCE OF [TWO] CLASSES OF NOTES            The ability to declare an event of master servicing termination
     SECURED BY A SINGLE TRUST FUND.......         under the sale and servicing agreement or an event of default
                                                   under the indenture, or to amend the sale and servicing agreement or the
                                                   indenture rests with the note insurer and the holders of specified
                                                   percentages of the notes in both groups. [In addition, under certain
                                                   circumstances the third party credit enhancer will have those rights as
                                                   they relate to the Class [ ] Notes.] As a result you may have less ability
                                                   to control certain actions than you would have had if only a single class
                                                   of notes had been issued.]

                                                   For a discussion of additional risks pertaining to the notes, see "Risk
                                                   Factors" in the prospectus.




                                      S-18




[IMPACT OF WORLD EVENTS                            The economic impact of the United States' military operations in
                                                   Iraq, as well as the possibility of any terrorist attacks in
                                                   response to these operations, is uncertain, but could have a
                                                   material effect on general economic conditions, consumer
                                                   confidence, and market liquidity. No assurance can be given as to
                                                   the effect of these events on consumer confidence and the
                                                   performance of the mortgage loans. Any adverse impact to the
                                                   mortgage loans resulting from these events would be borne by the
                                                   holders of the certificates. United States military operations
                                                   may also increase the likelihood of shortfalls under the Relief
                                                   Act.]



                                       THE TRUST

GENERAL

         IndyMac Home Equity Loan Trust 200[ ]-[ ] is a statutory trust formed
under the laws of the State of Delaware pursuant to the Trust Agreement, dated
[     , 200[ ]], between IndyMac ABS, Inc., as depositor, and [Name of owner
trustee], as owner trustee, to enter into the transactions described in this
prospectus supplement. After its formation, the trust will not engage in any
activity other than

         o acquiring, holding and managing the mortgage loans and the other
           assets of the trust and their proceeds,

         o issuing the Notes and the transferor's interest,

         o making payments on the Notes and the transferor's interest, and

         o engaging in other activities that are appropriate in connection
           these activities.

         The trust's principal offices are located in [Wilmington, Delaware], in
care of [Name of owner trustee], as owner trustee, at its address below.

TRUST ASSETS

The property of the trust will generally consist of:

         o the principal balance of each mortgage loan as of the close of
business on cut-off date (referred to as the cut-off date principal balance),
plus any new advances made on it under the applicable credit line agreement
during the life of the trust fund ("Additional Balances");

         o the related mortgage files;

         o collections on the mortgage loans received after the cut-off date
(exclusive of payments of accrued interest due on or before the cut-off date);

         o mortgaged properties securing the mortgage loans that are acquired by
foreclosure or deed in lieu of foreclosure;

                                      S-19


         o the collection account for the Notes (excluding its net earnings);

         o [the Additional Loan Account[s] and any additional loans purchased
with their proceeds;]

         o [the Reserve Fund (excluding its net earnings);]

         o the Policy and any further credit enhancement for the Notes; and

         o an assignment of the depositor's rights under the purchase agreement.

         The assets of the trust comprising loan group [ ], the related
collection account, [the related Additional Loan Account, the Reserve Fund,] the
Policy, and the depositor's rights under the agreement under which it purchased
the mortgage loans will be pledged to the indenture trustee as security for the
Class [ ] Notes pursuant to the indenture. [The assets of the trust comprising
loan group [ ], the related collection account, [the related Additional Loan
Account, the Reserve Fund,] the Policy, and the depositor's rights under the
agreement under which it purchased the mortgage loans will be pledged to the
indenture trustee as security for the Class [ ] Notes pursuant to the
indenture.]

         A substantial portion of the economic interest in the mortgage loans,
and consequently the trust, is related to the repayment of the Notes and subject
to the lien of the indenture. All of the remaining interest in the mortgage
loans in the trust fund will be represented by a single transferor interest that
will be owned by the transferor.

         The transferor has the right to sell or pledge the transferor interest
at any time, if

         o the Rating Agencies have notified the transferor and the indenture
trustee in writing that the action will not result in the reduction or
withdrawal of the ratings assigned to the Notes without regard to the Policy [or
any other third party credit enhancements], and

         o certain other conditions specified in the trust agreement are
satisfied.

         The owner trustee and any of its affiliates may hold Notes in their own
names or as pledgees. To meet the legal requirements of certain jurisdictions,
the owner trustee may appoint co-trustees or separate trustees of any part of
the trust fund under the trust agreement. All rights and obligations conferred
or imposed on the owner trustee by the sale and servicing agreement and the
trust agreement will be conferred or imposed on any separate trustee or
co-trustee. In any jurisdiction in which the owner trustee or indenture trustee
is incompetent or unqualified to perform any act, the separate trustee or
co-trustee will perform the act solely at the direction of the owner trustee.

         The owner trustee may resign at any time, in which event the indenture
trustee must appoint a successor acceptable to the Note Insurer. The indenture
trustee may also remove the owner trustee if it ceases to be eligible to
continue as such under the trust agreement or becomes legally unable to act or
becomes insolvent. Any resignation or removal of the owner trustee and
appointment of a successor will not become effective until acceptance of the
appointment by the successor.

                                      S-20


DUTIES OF THE OWNER TRUSTEE

         The owner trustee will make no representations as to the validity or
sufficiency of the trust agreement, the Notes, or of any mortgage loans or
related documents, and will not be accountable for the use or application by the
depositor or the master servicer of any funds paid to the depositor or the
master servicer on the Notes, or the mortgage loans, or the investment of any
monies by the master servicer before being deposited into the collection
accounts. The owner trustee will be required to perform only those duties
specifically required of it under the trust agreement. Generally, those duties
will be limited to the receipt of the various certificates, reports or other
instruments required to be furnished to the owner trustee under the trust
agreement, in which case it will only be required to examine them to determine
whether they conform to the requirements of the trust agreement.

CERTAIN ACTIVITIES

         The trust fund will not borrow money, make loans, invest in securities
for the purpose of exercising control, underwrite securities, except as provided
in the trust agreement, engage in the purchase and sale (or turnover) of
investments, offer securities in exchange for property (except the Notes for the
mortgage loans), or repurchase or otherwise reacquire its securities. See
"Description of the Sale and Servicing Agreement -- Evidence as to Compliance"
above for information regarding reports as to the compliance by the master
servicer with the sale and servicing agreement.

TERMINATION

         In no event, however, will the trust fund created by the trust
agreement continue for more than 21 years after the death of certain individuals
named in the sale and servicing agreement. Written notice of termination of the
trust agreement will be given to each noteholder, and the final distribution
will be made only upon surrender and cancellation of the Notes at an office or
agency appointed by the indenture trustee which will be specified in the notice
of termination.

THE OWNER TRUSTEE

         [Name of owner trustee] will act as the owner trustee under the trust
agreement. [Name of owner trustee] is a Delaware banking corporation and its
principal officers are located at [ ], [Wilmington, Delaware].

                                THE NOTE INSURER

         The following information in this section has been provided by [Note
Insurer] (the "Note Insurer"). Accordingly, none of the depositor, the seller
and master servicer[, any third party credit enhancer] or the underwriter makes
any representation as to the accuracy and completeness of the information in
this section.

         [Description of Note Insurer, including financial information]

                                      S-21


                               THE MASTER SERVICER

GENERAL

         [IndyMac Bank, F.S.B. ("IndyMac Bank") will service the mortgage loans
consisting of [adjustable] rate home equity revolving credit line loans made or
to be made in the future in accordance with the sale and servicing agreement.
The mortgage loans will be secured by either first or second deeds of trust or
mortgages on the residential properties that are primarily single family
properties, individual units in planned unit developments or condominium units.

         IndyMac Bank may perform any of its obligations under the sale and
servicing agreement dated as of [ ], 200[ ] among IndyMac ABS, Inc., as
depositor, IndyMac Bank, as seller and master servicer [Name of third party
enhancer, if any] and [Name of owner trustee], as owner trustee, through one or
more subservicers. Notwithstanding any subservicing arrangement, the master
servicer will remain liable for its servicing obligations under the sale and
servicing agreement as if the master servicer alone were servicing the mortgage
loans. As of the Closing Date, the master servicer will service the mortgage
loans without subservicing arrangements.]

THE MASTER SERVICER

         [IndyMac Bank will act as master servicer. The principal executive
offices of the master servicer are located at 155 North Lake Avenue, Pasadena,
California 91101. IndyMac Bank is a wholly-owned subsidiary of IndyMac
Intermediate Holdings, Inc., which is a wholly-owned subsidiary of IndyMac
Bancorp, Inc.

         Effective July 1, 2000, IndyMac Mortgage Holdings, Inc. ("Holdings")
acquired SGV Bancorp, the holding company of First Federal Savings and Loan
Association of San Gabriel Valley ("First Federal"). In connection with that
acquisition, IndyMac, Inc., the wholly-owned mortgage banking subsidiary of
Holdings, was merged with and into SGV Bancorp, and SGV Bancorp contributed
substantially all of its assets and liabilities (including the servicing
platform and all of the related servicing operations of the former IndyMac,
Inc., together with substantially all of its personnel) to First Federal. Also
in connection with the acquisition, Holdings changed its name to IndyMac
Bancorp, Inc., SGV Bancorp changed its name to IndyMac Intermediate Holdings,
Inc. and First Federal changed its name to IndyMac Bank, F.S.B.

         The master servicer will be responsible for servicing the mortgage
loans in accordance with the terms set forth in the sale and servicing agreement
employing the same degree of skill and care which it employs n servicing the
mortgage loans comparable to the mortgage loans serviced by the master servicer
for itself or others. The master servicer may perform its servicing obligations
under the sale and servicing agreement through one or more subservicers selected
by the master servicer. Notwithstanding any subservicing agreement, the master
servicer will remain liable for its servicing duties and obligations under the
sale and servicing agreement as if the master servicer alone were servicing the
mortgage loans.

         During the first half of 1998, the former IndyMac, Inc. acquired a
servicing platform (i.e., the servicing business operations but not mortgage
loans) from First of America Loan Services, Inc. in order to provide IndyMac,
Inc. with direct servicing capabilities for mortgage loans,

                                      S-22





including home equity revolving credit line loans. Prior to that time,
IndyMac, Inc. had master servicing capabilities but no direct servicing
capabilities. In connection with the acquisition of SGV Bancorp, the servicing
platform of First of America Loan Services, Inc. was contributed to IndyMac
Bank. As of the closing date, it is expected that IndyMac Bank will directly
service [__%] of the initial mortgage loans (by cut-off date pool principal
balance). With respect to the other mortgage loans in the mortgage pool, as of
the closing date, it is expected that IndyMac Bank will perform its servicing
obligations under the sale and servicing agreement through one or more
subservicers.

         If the servicing of any mortgage loan were to be transferred from a
subservicer to IndyMac Bank, or if any other servicing transfer were to occur,
there may be an increase in all delinquencies and defaults due to misapplied or
lost payments, data input errors, system incompatibilities or otherwise.
Although any increase in delinquencies is expected to be temporary, there can be
no assurance as to the duration or severity of any disruption in servicing the
applicable mortgage loans as a result of any servicing transfer.

         As of ______, 200_, IndyMac Bank provided servicing for approximately
$___ billion in conventional mortgage loans, of which approximately $[ ]
comprised home equity loans.]

                          THE HOME EQUITY LOAN PROGRAM

UNDERWRITING PROCEDURES RELATING TO HOME EQUITY LOANS

         The following is a description of the underwriting procedures
customarily employed by the seller with respect to home equity loans. The
underwriting process is intended to assess the applicant's credit standing and
repayment ability, and the value and adequacy of the real property security as
collateral for the proposed loan. Exceptions to the seller's underwriting
guidelines will be made when compensating factors are present. These factors
include the borrower's employment stability, favorable credit history, equity in
the related property and the nature of the underlying first mortgage loan

[Description of Specific Underwriting Procedures to be Included in the
                Prospectus Supplement for an Actual Transaction]

SERVICING OF THE MORTGAGE LOANS

         [The master servicer has established standard policies for the
servicing and collection of the home equity loans. Servicing includes, but is
not limited to,

         o the collection and aggregation of payments relating to the mortgage
loans;

         o the supervision of delinquent mortgage loans, loss mitigation
efforts, foreclosure proceedings and, if applicable, the disposition of the
mortgaged properties; and

         o the preparation of tax related information in connection with the
mortgage loans.

[Description of Specific Servicing Standards to be Included in the
                Prospectus Supplement for an Actual Transaction]


                                      S-23


FORECLOSURE AND DELINQUENCY EXPERIENCE

         [IndyMac, Inc. commenced master servicing conventional mortgage loans
during April 1993 and commenced servicing conventional mortgage loans during
August 1998. In connection with the acquisition of SGV Bancorp, the master
servicing and servicing operations of the former IndyMac, Inc. were contributed
to IndyMac Bank, resulting in IndyMac Bank performing the master servicing and
servicing operations previously performed by IndyMac, Inc.]

         The following table summarizes the delinquency and foreclosure
experience, respectively, on the dates indicated, of home equity loans serviced
by the master servicer. The delinquency and foreclosure percentages may be
affected by the size and relative lack of seasoning of the servicing portfolio
because many of the loans were not outstanding long enough to give rise to some
or all of the periods of delinquency indicated in the chart below. Accordingly,
the information should not be considered a basis for assessing the likelihood,
amount, or severity of delinquencies or losses on the mortgage loans in the loan
groups. The foreclosure and delinquency experience presented in the table below
may not be indicative of the foreclosure and delinquency experience the mortgage
loans in the loan groups will experience.

         For the purposes of the following table:

         o The period of delinquency is based on the number of days payments are
contractually past due.

         o Certain total percentages and dollar amounts may not equal the sum of
the percentages and dollar amounts indicated in the columns due to differences
in rounding.

         o "Foreclosure Rate" is the dollar amount of mortgage loans in
foreclosure as a percentage of the total principal balance of mortgage loans
outstanding as of the date indicated.

         o "Bankruptcy Rate" is the dollar amount of mortgage loans for which
the related borrower has declared bankruptcy as a percentage of the total
principal balance of mortgage loans outstanding as of the date indicated.]




                                             DELINQUENCY AND FORECLOSURE EXPERIENCE

                                AS OF [         ]             AS OF [         ]             AS OF [         ]
                                -----------------             -----------------             -----------------
                            PRINCIPAL                       PRINCIPAL                    PRINCIPAL
                             BALANCE      PERCENTAGE         BALANCE      PERCENTAGE      BALANCE       PERCENTAGE
                             -------      ----------         -------      ----------      -------       ----------

Portfolio................   $[      ]         --            $[      ]        --          $[      ]         --
Delinquency percentage
      30-59 Days.........   $[      ]        [  ]%          $[      ]       [  ]%        $[      ]        [  ]%
      60-89 Days.........    [      ]        [  ]            [      ]       [  ]          [      ]        [  ]
      90+ Days...........    [      ]        [  ]            [      ]       [  ]          [      ]        [  ]
                            ---------        -----          ---------       -----        ---------        -----
         Total...........   $[      ]        [  ]%          $[      ]       [  ]%        $[      ]        [  ]%
                            =========        =====          =========       =====        =========        =====
Foreclosure Rate.........   $[      ]        [  ]%          $[      ]       [  ]%        $[      ]        [  ]%
Bankruptcy Rate..........   $[      ]        [  ]%          $[      ]       [  ]%        $[      ]        [  ]%


                                      S-24


         Historically, a variety of factors, including the appreciation of real
estate values, has limited the master servicer's loss and delinquency experience
on its portfolio of serviced mortgage loans. There can be no assurance that
factors beyond the master servicer's control, such as national or local economic
conditions or downturns in the real estate markets of its lending areas, will
not result in increased rates of delinquencies and foreclosure losses in the
future. For example, a general deterioration of the real estate market regions
where the mortgaged properties are located may result in increases in
delinquencies of loans secured by real estate, slower absorption rates of real
estate into the market and lower sales prices for real estate. A general
weakening of the economy may result in decreases in the financial strength of
borrowers and decreases in the value of collateral serving as collateral for
loans. If the real estate market and economy continue to decline, the master
servicer may experience an increase in delinquencies on the loans its services
and higher net losses on liquidated loans.

                       DESCRIPTION OF THE MORTGAGE LOANS

GENERAL

         [Certain statistical information concerning the pool of mortgage loans
is set forth below (the pool is referred to as the "Statistical Calculation
Pool" and each mortgage loan is referred to as a "Statistical Calculation Pool
Mortgage Loan"). The mortgage pool will be divided into [two] groups of mortgage
loans (each is referred to as a loan group) -- loan group [ ] and loan group [
]. The repayment of the Class [ ] Notes will be secured by a security interest
in loan group [ ] only [and the repayment of the Class [ ] Notes will be secured
by a security interest in loan group [ ].] [Loan group [ ] information is
included chiefly to provide a better understanding about the trust fund.] A
detailed description of the mortgage loans actually delivered (the "Detailed
Description") will be available to purchasers of the Notes at or before, and
will be filed on Form 8-K with the Securities and Exchange Commission within
fifteen days after, delivery of the Notes. The Detailed Description will specify
the aggregate of the principal balances of the mortgage loans included in the
trust fund as of the cut-off date and will also include, among other things, the
following information regarding the mortgage loans:

         o the outstanding principal balances of the mortgage loans as of [ ],
200[ ] (the cut-off date) [or the related transfer date],

         o the lien priorities of the mortgage loans,

         o the loan rates borne by the mortgage loans as of the cut-off date,

         o the combined loan-to-value ratios of the mortgage loans,

         o the remaining term to scheduled maturity of the mortgage loans,

         o the type of properties securing the mortgage loans,

         o the geographical distribution of the mortgage loans by state and

         o the credit limits and credit limit utilization rates of the mortgage
loans as of the cut-off date.

                                      S-25


         [The Detailed Description speaks as of the cut-off date and
consequently does not include any Additional Home Equity Loans purchased with
the funds in the additional loan accounts.] The mortgage loans will have been
originated pursuant to credit line agreements and will be secured by mortgages
or deeds of trust. The mortgages and deeds of trust are either first or second
mortgages or deeds of trust on mortgaged properties expected to be located in
[49 states and the District of Columbia] as of the cut-off date. The mortgaged
properties securing the mortgage loans will consist of residential properties
that are primarily single family residences, individual units in planned unit
developments or condominium units. See " -- Mortgage Loan Terms" below.

         Information regarding the Statistical Calculation Pool Mortgage Loans
as of [ ], 200[ ] (the "Statistical Calculation Date") can be found on the
tables on pages [S-__] through [S-__].]

MORTGAGE LOAN TERMS

         [General. A borrower may access a mortgage loan by writing a check in a
minimum amount of $[ ]. The mortgage loans bear interest at a variable rate that
changes monthly on the first business day of the related month with changes in
the applicable index rate. The Statistical Calculation Pool Mortgage Loans are
subject to a maximum per annum interest rate ranging from [ ]% to [ ]% per
annum, subject to applicable usury limitations. See "Certain Legal Aspects of
the Loans -- Applicability of Usury Laws" in the prospectus. The daily periodic
rate on the mortgage loans (i.e., the loan rate) is the sum of the index rate
plus the applicable margin, divided by 365 days. The margin generally ranges
between [ ]% and [ ]%. The index rate is based on the highest "prime rate"
published in the "Money Rates" table of The Wall Street Journal as of the first
business day of each calendar month.

         The second mortgage ratio for a mortgage loan in a second lien position
is the credit limit for the related mortgage loan divided by the sum of the
credit limit and the outstanding principal balance of any mortgage loan senior
to the related mortgage loan as of the date of related loan application. The
weighted average second mortgage loan ratio for the Loan Group [ ] Statistical
Calculation Pool Mortgage Loans was approximately [ ]%. The weighted average
second mortgage ratio for the Loan Group [ ] Statistical Calculation Pool
Mortgage Loans was approximately [ ]%.

         IndyMac Bank generally offers introductory loan rates on its home
equity lines of credit. The introductory rate applies to payments made during
the [first three months or first six months] after origination. After the
introductory period, the loan rate will adjust to the index rate plus the
applicable margin.

         In general, the home equity loans may be drawn on during a draw period
of either [five] years or [three] years. Home equity loans with a draw period of
[five] years (which generally may be extendible for an additional [five] years,
with IndyMac Bank's approval) constitute approximately [ ]% of the Loan Group [
] Statistical Calculation Pool Mortgage Loans and approximately [ ]% of the Loan
Group [ ] Statistical Calculation Pool Mortgage Loans, each by Statistical
Calculation Date Principal Balance. Home equity loans with a draw period of
[three] years (which generally may be extendible for an additional [three]
years, with IndyMac

                                      S-26


Bank's approval) constitute approximately [ ]% of the Loan Group [ ] Statistical
Calculation Pool Mortgage Loans and approximately [ ]% of the Loan Group [ ]
Statistical Calculation Pool Mortgage Loans, each by Statistical Calculation
Date Principal Balance. Mortgage loans with a [five] year draw period are
generally subject to a [fifteen] year repayment period following the end of the
draw period. Mortgage loans with a [three] year draw period are generally
subject to a [ten] year repayment period following the end of the draw period.
During this repayment period, the outstanding principal balance of the loan will
be paid in monthly installments equal to [1/180] of the outstanding principal
balance at the end of the draw period for loans with a [five] year draw period
or [1/120] of the outstanding principal balance at the end of the draw period
for loans with a [three] year draw period.

         The minimum payment due during the draw period will be equal to the
finance charges accrued on the outstanding principal balance of the home equity
loan during the related billing period, any past due finance charges and any
other charges owed. The minimum payment due during the repayment period will be
equal to the sum of the finance charges accrued on the outstanding principal
balance of the mortgage loan during the related billing period, any amounts past
due, any other charges owed and the principal payment described above.

         The principal balance of a mortgage loan (other than a Liquidated
Mortgage Loan) on any day is equal to

         o its principal balance as of the cut-off date for the mortgage loans
purchased on the Closing Date [and as of the relevant date for the additional
home equity loans] plus

         o any Additional Balances for the mortgage loan, minus

         o all collections credited against the principal balance of the
mortgage loan in accordance with the related credit line agreement before the
relevant day.

The principal balance of a Liquidated Mortgage Loan after final recovery of
related liquidation proceeds shall be zero.

         Difference between Statistical Calculation Pool and Cut-off Date Pool.
The statistical information presented in this prospectus supplement for each
loan group reflects the mortgage loans originated by the seller through the
Statistical Calculation Date, and is based on the number and the principal
balances of the mortgage loans in each loan group as of the Statistical
Calculation Date. The depositor expects that the actual pool as of the Closing
Date will represent approximately $[ ] aggregate principal balance of mortgage
loans. Loan group [ ], which has a Statistical Calculation Date Principal
Balance of approximately $[ ], is expected to have a cut-off date principal
balance of approximately $[ ]. Loan group [ ], which has a Statistical
Calculation Date Principal Balance of approximately $[ ], is expected to have a
cut-off date principal balance of $[ ]. [The trust also will include
approximately $[ ] for loan group [ ] and $[ ] for loan group [ ] in the
relevant additional loan accounts that may be applied to the purchase of
additional mortgage loans as described below.] The [initial] mortgage loans to
be included in the cut-off date pool will represent mortgage loans originated by
the seller on or before the cut-off date and sold by the seller to the
depositor, and by the depositor to the trust fund, on the Closing Date. In
addition, with respect to the Statistical Calculation Pool Mortgage Loans, as to
which statistical information is presented in this prospectus supplement,

                                      S-27


some amortization will occur and some Additional Balances may be created before
the cut-off date. Moreover, certain Statistical Calculation Pool Mortgage Loans
may prepay in full or may be determined not to meet the eligibility requirements
for the final cut-off date pool and as a result may not be included in the
cut-off date pool. As a result of the foregoing, the statistical distribution of
characteristics as of the cut-off date for the cut-off date mortgage loan pool
will vary from the statistical distribution of characteristics of each
Statistical Calculation Loan Group as presented in this prospectus supplement,
although the variance will not be material. If the seller does not, as of the
cut-off date, have the full amount of mortgage loans that the depositor expects
to purchase from the seller and sell to the trust fund on the cut-off date (i.e.
approximately $[ ] aggregate principal balance of mortgage loans), the depositor
may reduce the size of the offering. Likewise, if the seller has more mortgage
loans than anticipated, the depositor may increase the size of the offering. The
original principal amount of either class of Notes may not decrease or increase
by more than [5]%. [For each loan group, the excess of the original principal
balance of the related Notes over the cut-off date principal balance of that
loan group will be deposited into an account (the account for loan group [ ],
the "Additional Loan Account"). These funds are expected to be used to acquire
additional home equity loans not in the cut-off date pool (these loans for loan
group [ ], the "Additional Home Equity Loans"). Consequently, the statistical
distribution characteristics of loan group [ ] after the addition of Additional
Home Equity Loans will vary from that of both the loan group [ ] cut-off date
mortgage loan pool and the Loan Group [ ] Statistical Calculation Pool Mortgage
Loans. Any funds remaining in the Additional Loan Account on [ ] will be used to
prepay the Class [ ] Notes on the first payment date].

         The sum of the columns below may not equal the total indicated for each
loan group due to rounding. The following tables describe the Statistical
Calculation Pool Mortgage Loans in each loan group and the related mortgaged
properties based upon the Loan Group [ ] Statistical Calculation Pool or the
Loan Group [ ] Statistical Calculation Pool, as applicable, as of the close of
business on the Statistical Calculation Date:


                                      S-28


                                 LOAN GROUP [ ]

                               PRINCIPAL BALANCES



                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
            RANGE OF PRINCIPAL BALANCES                    LOANS               BALANCE            PRINCIPAL BALANCE
            ---------------------------                    -----               -------            -----------------

$             -$         .......................                            $                                  %
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
                                                           -----               -------                   ------
         Total..................................                            $                            100.00%
                                                           =====               =======                   ======


         The combined loan-to-value ratio in the following table is a fraction
whose numerator is the sum of (i) the credit limit of the mortgage loans and
(ii) any outstanding principal balances of mortgage loans senior or of equal
priority to the mortgage loans (calculated generally at the date of origination
of the mortgage loans) and whose denominator is the lesser of (i) the appraised
value of the related mortgaged property as stated in loan files at the date of
origination or (ii) in the case of a mortgaged property purchased within one
year of the origination of the related mortgage loan, the purchase price of the
mortgaged property.

                                      S-29


                          COMBINED LOAN-TO-VALUE RATIOS



                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
      RANGE OF COMBINED LOAN-TO-VALUE RATIOS               LOANS               BALANCE            PRINCIPAL BALANCE
      --------------------------------------               -----               -------            -----------------

Less than      %................................                               $                               %
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======


         The loan rates in the following table reflect the fact that
approximately [ ]% of the Loan Group [ ] Statistical Calculation Pool Mortgage
Loans by Statistical Calculation Date Principal Balance are currently subject to
an introductory rate of [ ]% per annum and [ ]% of the Loan Group [ ]
Statistical Calculation Pool Mortgage Loans by Statistical Calculation Date
Principal Balance are currently subject to an introductory rate of [ ]% per
annum.

                                      S-30


                                   LOAN RATES


                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
                                                           LOANS               BALANCE            PRINCIPAL BALANCE
                                                           -----               -------            -----------------

Less than      %................................                               $                               %
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======





                                      S-31


                             GEOGRAPHIC DISTRIBUTION



                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
                       STATE                               LOANS               BALANCE            PRINCIPAL BALANCE
                       -----                               -----               -------            -----------------

     ...........................................                               $                               %
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................



                                      S-32





     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
                                                           -----               -------                   ------
     Total......................................                              $                          100.00%
                                                           =====               =======                   ======


         The geographic location used for the above table is determined by the
address of the mortgaged property securing the related mortgage loan.


                                  PROPERTY TYPE


                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
                   PROPERTY TYPE                           LOANS               BALANCE            PRINCIPAL BALANCE
                   -------------                           -----               -------            -----------------

Single Family Residence.........................                               $                               %
Planned Unit Development........................
Condominium Unit................................
2-4 Family Residence............................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======


                                  LIEN PRIORITY


                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
                   LIEN PROPERTY                           LOANS               BALANCE            PRINCIPAL BALANCE
                   -------------                           -----               -------            -----------------


1st Liens.......................................                               $                               %
2nd Liens.......................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======



                                      S-33


                                     MARGINS



                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
                 RANGE OF MARGINS                          LOANS               BALANCE            PRINCIPAL BALANCE
                 ----------------                          -----               -------            -----------------

     %..........................................                               $                               %
     -        ..................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======


         The credit limit utilization rates in the following table are
determined by dividing the Loan Group [ ] Statistical Calculation Date Balance
for the particular grouping by the aggregate of the credit limits of the related
credit line agreements.


                                      S-34


                         CREDIT LIMIT UTILIZATION RATES


                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                  RANGE OF CREDIT                        MORTGAGE             PRINCIPAL            DATE AGGREGATE
              LIMIT UTILIZATION RATES                      LOANS               BALANCE            PRINCIPAL BALANCE
              -----------------------                      -----               -------            -----------------

     %..........................................                               $                               %
     -        ..................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======


                                  MAXIMUM RATES



                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
                   MAXIMUM RATES                           LOANS               BALANCE            PRINCIPAL BALANCE
                   -------------                           -----               -------            -----------------

%...............................................                               $                               %
................................................
................................................
................................................
................................................
................................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======


                                      S-35


                     MONTHS REMAINING TO SCHEDULED MATURITY


                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                  RANGE OF MONTHS                        NUMBER OF              UNPAID               CALCULATION
                   REMAINING TO                          MORTGAGE             PRINCIPAL            DATE AGGREGATE
                SCHEDULED MATURITY                         LOANS               BALANCE            PRINCIPAL BALANCE
                ------------------                         -----               -------            -----------------

     -..........................................                               $                               %
     -         .................................
     -         .................................
     -         .................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======


         The above table assumes that the draw period for Loan Group [ ]
Statistical Calculation Pool Mortgage Loans with (a) five year draw periods and
fifteen year repayment periods will be extended for an additional five years and
(b) five year draw periods and ten year repayment periods will not be extended.


                                ORIGINATION YEAR


                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
                 ORIGINATION YEAR                          LOANS               BALANCE            PRINCIPAL BALANCE
                 ----------------                          -----               -------            -----------------

     ...........................................                               $                               %
     ...........................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======



                                      S-36


                               DELINQUENCY STATUS



                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
             NUMBER OF DAYS DELINQUENT                     LOANS               BALANCE            PRINCIPAL BALANCE
             -------------------------                     -----               -------            -----------------

Current.........................................                               $                               %
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======



                                      S-37


                                  CREDIT LIMITS


                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
              RANGE OF CREDIT LIMITS                       LOANS               BALANCE            PRINCIPAL BALANCE
              ----------------------                       -----               -------            -----------------

$             -$         .......................                               $                               %
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
                                                           -----               -------                   ------
         Total..................................                               $                         100.00%
                                                           =====               =======                   ======



                                      S-38


                                 LOAN GROUP [ ]

                               PRINCIPAL BALANCES



                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
            RANGE OF PRINCIPAL BALANCES                    LOANS               BALANCE            PRINCIPAL BALANCE
            ---------------------------                    -----               -------            -----------------

$             -$         .......................                               $                               %
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
                                                           -----               -------                   ------
         Total..................................                               $                         100.00%
                                                           =====               =======                   ======


         The combined loan-to-value ratio in the following table is a fraction
whose numerator is the sum of (i) the credit limit of the mortgage loans and
(ii) any outstanding principal balances of mortgage loans senior or of equal
priority to the mortgage loans (calculated generally at the date of origination
of the mortgage loans) and whose denominator is the lesser of (i) the appraised
value of the related mortgaged property as stated in loan files at the date of
origination or (ii) in the case of a mortgaged property purchased within one
year of the origination of the related mortgage loan, the purchase price of the
mortgaged property.


                                      S-39


                          COMBINED LOAN-TO-VALUE RATIOS


                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
      RANGE OF COMBINED LOAN-TO-VALUE RATIOS               LOANS               BALANCE            PRINCIPAL BALANCE
      --------------------------------------               -----               -------            -----------------

Less than      %................................                               $                               %
     -        ..................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======


         The loan rates in the following table reflect the fact that
approximately [ ]% of the Loan Group [ ] Statistical Calculation Pool Mortgage
Loans by Statistical Calculation Date Principal Balance are currently subject to
an introductory rate of [ ]% per annum and [ ]% of the Loan Group [ ]
Statistical Calculation Pool Mortgage Loans by Statistical Calculation Date
Principal Balance are currently subject to an introductory rate of [ ]% per
annum.

                                      S-40


                                   LOAN RATES



                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
                                                           LOANS               BALANCE            PRINCIPAL BALANCE
                                                           -----               -------            -----------------

Less than      %................................                               $                               %
     -        ..................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======



                                      S-41


                             GEOGRAPHIC DISTRIBUTION



                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
                       STATE                               LOANS               BALANCE            PRINCIPAL BALANCE
                       -----                               -----               -------            -----------------

     ...........................................                               $                               %
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................


                                      S-42





     ...........................................
     ...........................................
     ...........................................
     ...........................................
     ...........................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======


         The geographic location used for the above table is determined by the
address of the mortgaged property securing the related mortgage loan.


                                  PROPERTY TYPE



                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
                   PROPERTY TYPE                           LOANS               BALANCE            PRINCIPAL BALANCE
                   -------------                           -----               -------            -----------------

Single Family...................................                               $                               %
Planned Unit Development........................
Low-rise Condominium Unit.......................
2-4 Family Residence............................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======


                                  LIEN PRIORITY



                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
                   LIEN PROPERTY                           LOANS               BALANCE            PRINCIPAL BALANCE
                   -------------                           -----               -------            -----------------

1st Liens.......................................                               $                               %
2nd Liens.......................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======


                                      S-43


                                     MARGINS



                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
                 RANGE OF MARGINS                          LOANS               BALANCE            PRINCIPAL BALANCE
                 ----------------                          -----               -------            -----------------

     %..........................................                               $                               %
     -        ..................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======


         The credit limit utilization rates in the following table are
determined by dividing the Loan Group [ ] Statistical Calculation Date Balance
for the particular grouping by the aggregate of the credit limits of the related
credit line agreements.



                                      S-44


                         CREDIT LIMIT UTILIZATION RATES



                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                  RANGE OF CREDIT                        MORTGAGE             PRINCIPAL            DATE AGGREGATE
              LIMIT UTILIZATION RATES                      LOANS               BALANCE            PRINCIPAL BALANCE
              -----------------------                      -----               -------            -----------------

     %..........................................                               $                               %
     -        ..................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
     -         .................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======



                                  MAXIMUM RATES


                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
                   MAXIMUM RATES                           LOANS               BALANCE            PRINCIPAL BALANCE
                   -------------                           -----               -------            -----------------

%...............................................                               $                               %
................................................
................................................
................................................
................................................
................................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======


                                      S-45


                     MONTHS REMAINING TO SCHEDULED MATURITY


                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                  RANGE OF MONTHS                        NUMBER OF              UNPAID               CALCULATION
                   REMAINING TO                          MORTGAGE             PRINCIPAL            DATE AGGREGATE
                SCHEDULED MATURITY                         LOANS               BALANCE            PRINCIPAL BALANCE
                ------------------                         -----               -------            -----------------

     -..........................................                               $                               %
     -         .................................
     -         .................................
     -         .................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======


         The above table assumes that the draw period for Loan Group [ ]
Statistical Calculation Pool Mortgage Loans with (a) five year draw periods and
fifteen year repayment periods will be extended for an additional five years and
(b) five year draw periods and ten year repayment periods will not be extended.


                                ORIGINATION YEAR



                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
                 ORIGINATION YEAR                          LOANS               BALANCE            PRINCIPAL BALANCE
                 ----------------                          -----               -------            -----------------

     ...........................................                               $                               %
     ...........................................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======


                                      S-46


                               DELINQUENCY STATUS



                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
             NUMBER OF DAYS DELINQUENT                     LOANS               BALANCE            PRINCIPAL BALANCE
             -------------------------                     -----               -------            -----------------

Current.........................................                               $                               %
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======


                                  CREDIT LIMITS



                                                                                                    PERCENTAGE OF
                                                                                                   LOAN GROUP [  ]
                                                                              AGGREGATE              STATISTICAL
                                                         NUMBER OF              UNPAID               CALCULATION
                                                         MORTGAGE             PRINCIPAL            DATE AGGREGATE
              RANGE OF CREDIT LIMITS                       LOANS               BALANCE            PRINCIPAL BALANCE
              ----------------------                       -----               -------            -----------------

$             -$         .......................                               $                              %
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
$             -$         .......................
                                                           -----               -------                   ------
     Total......................................                               $                         100.00%
                                                           =====               =======                   ======


                                      S-47


CONVEYANCE OF MORTGAGE LOANS

         The obligation of the trust fund to purchase mortgage loans [for loan
group [ ]] on the Closing Date is subject to the following requirements, any of
which requirements may be waived or modified in any respect by the Note Insurer:

         o the mortgage loan may not be [60] or more days delinquent as of the
Closing Date;

         o the remaining term to stated maturity of the mortgage loan will not
exceed [ ] months;

         o the mortgage loan will be secured by a mortgage in a first or second
lien position;

         o the mortgage loan will not have a loan rate less than [ ]%;

         o the mortgage loan will be otherwise acceptable to the Note Insurer;

         o following the purchase of the mortgage loan by the trust fund, the
mortgage loans as of the Closing Date

                  (a)  will have a weighted average loan rate of at least [ ]%;

                  (b)  will have a weighted average remaining term to stated
                       maturity of not more than [ ] months;

                  (c)  will have a weighted average combined loan-to-value ratio
                       of not more than [ ]%;

                  (d)  will have no mortgage loan with a principal balance in
                       excess of $[ ];

                  (e)  will have a concentration in any one state not in excess
                       of [ ]%; and will have a concentration in any one zip
                       code not in excess of [ ]%;

                  (f)  will have not more than [ ]% in aggregate principal
                       balance of mortgage loans relating to non-owner occupied
                       properties;

                  (g)  will not have more than [ ]% in aggregate principal
                       balance of mortgage loans that were appraised
                       electronically; and

                  (h)  will have a weighted average FICO score of at least [ ]
                       points.

         o the mortgage loan shall have a combined loan-to-value ratio not in
excess of [ ];

         o the mortgage loan will have a credit limit between $[ ] and $[ ];

         o the mortgage loan will have a margin between [ ]% and [ ]%; and

         o the mortgage loan will comply with the representations and warranties
in the sale and servicing agreement.

         The trust fund may acquire Additional Home Equity Loans through [ ]
[that will be included in loan group [ ]] so long as they conform to the
criteria listed above. Each Additional Home Equity Loan will have been
underwritten substantially in accordance with the criteria described under "The
Home Equity Loan Program -- Underwriting Procedures Relating to Home Equity
Loans." Additional Home Equity Loans will be purchased using amounts on

                                      S-48


deposit in the Additional Loan Account[s] at a cash purchase price of [100]% of
their principal balance on a designated cut-off date before [ ]. The amount paid
from the Additional Loan Account[s] for Additional Home Equity Loans will not
include accrued interest. Following each purchase of Additional Home Equity
Loans [for a loan group], the aggregate principal balance of [the relevant] loan
group [ ] will increase by an amount equal to the aggregate principal balance of
the Additional Home Equity Loans so acquired and the amount in the Additional
Loan Account will decrease accordingly.

         Any conveyance of Additional Home Equity Loans is subject to various
conditions including:

         o that they satisfy substantially the same loan representations and
warranties as the initial home equity loans;

         o that they were identified by means of a selection process reasonably
believed not to be adverse to the interests of the holders of the Notes and the
Note Insurer;

         o that the trust fund receive opinions of counsel acceptable to the
Note Insurer and the indenture trustee with respect to the validity of the
conveyance of the Additional Home Equity Loans; and

         o that as of their cut-off date, each Additional Home Equity Loan
satisfied the eligibility requirements that the mortgage loans had to satisfy on
the closing date.

         [No discretion will be exercised in the selection of the Additional
Home Equity Loans to be acquired by the trust fund. They will all be mortgage
loans that had been applied for by the related borrowers before the cut-off
date, but that were not included in the cut-off date pool. The exact mortgage
loans to be acquired will be determined on a first-in, first-out basis. Mortgage
loans otherwise meeting the eligibility requirements will be aggregated by the
date on which they were funded, and all of these Additional Home Equity Loans
will be purchased in date order up through the day substantially all of the
funds in the Additional Loan Account are expended. On that last day, the
Additional Home Equity Loans will be ordered and acquired alphabetically by the
last name of the primary obligor. These acquisitions may occur in one or more
closings after the initial closing date.]

[THE ADDITIONAL LOAN ACCOUNT

         The assets of the trust fund will include the Additional Loan
Account[s] that will contain approximately $[ ] on the closing date representing
the excess of the original principal balance of the [Class [ ]] Notes over the
cut-off date principal balance of the mortgage loans [in loan group [ ]]
initially transferred to the trust fund on the closing date. Monies in the
Additional Loan Account[s] are expected to be used to purchase Additional Home
Equity Loans through [ ]. The Additional Loan Account[s] will be part of the
trust fund, but will not be available to cover losses on the mortgage loans. Any
funds remaining on deposit in the Additional Loan Account[s] on [ ] will be used
to prepay the [relevant class of] [Class [ ]] Notes on the first payment date.
Net income on investment of funds in the Additional Loan Account[s] will be paid
to the master servicer, and will not be available for payment on the Notes.]

                                      S-49


                     MATURITY AND PREPAYMENT CONSIDERATIONS

         The sale and servicing agreement, except as otherwise described in this
prospectus supplement, provides that the noteholders will be entitled to receive
on each payment date distributions of principal, in the amounts described under
"Description of the Notes -- Distributions on the Notes," until the Note
principal balance is reduced to zero. During the Managed Amortization Period,
noteholders will receive amounts from principal collections based on the
applicable Investor Fixed Allocation Percentage for the related loan group,
subject to reduction as described below. [In addition, the funds remaining in
the Additional Loan Account[s] on [ ] after the purchase of any Additional Home
Equity Loans on that date will be used to prepay the [relevant class of] [Class
[ ]] Notes on the first payment date.]

         For any date of calculation through the first payment date on which the
balance of the transferor interest for a loan group is greater than or equal to
the applicable Required Transferor Subordinated Amount, the "Investor Fixed
Allocation Percentage" will equal the greater of (i) [ ]% and (ii) 100% minus
the percentage obtained by dividing the amount of the transferor interest
allocable to a loan group at the beginning of the relevant Collection Period by
the loan group balance at the beginning of the relevant Collection Period.
Thereafter, the Investor Fixed Allocation Percentage will equal [ ]%. During a
Rapid Amortization Period, noteholders will receive amounts from principal
collections based solely on the Investor Fixed Allocation Percentage for the
related loan group. Because prior distributions of principal collections to
noteholders serve to reduce the related Investor Floating Allocation Percentage
but may not change the related Investor Fixed Allocation Percentage in all
instances, allocations of principal collections from the mortgage loans in a
loan group based on the related Investor Fixed Allocation Percentage may result
in distributions of principal to the noteholders in amounts that are, in most
cases, greater relative to the declining balance of the mortgage loans in that
loan group than would be the case if the related Investor Floating Allocation
Percentage were used to determine the percentage of principal collections from
the mortgage loans in that loan group distributed to noteholders. This is
especially true during the Rapid Amortization Period when the noteholders are
entitled to receive their respective Investor Principal Collections and not a
lesser amount.

         In addition, respective Investor Interest Collections may be
distributed as principal to noteholders of Notes in a particular loan group in
connection with the applicable Accelerated Principal Distribution Amount, if
any. Moreover, to the extent of losses allocable to the Notes related to a
particular loan group, those noteholders may also receive the amount of those
losses as payment of principal from the related Investor Interest Collections,
Investor Interest Collections from the other loan group, the Subordinated
Transferor Collections, [the Reserve Fund,] or, in some instances, draws under
the Policy [or payments under any third party enhancement]. The level of losses
may therefore affect the rate of payment of principal on the Notes.

         [As of the closing date, the transferor interest with respect to each
loan group will be $0. The transferor interest is expected to grow in the early
months of the transaction due to the payment of the applicable Accelerated
Principal Distribution Amount.] [In addition,] to the extent obligors make more
draws than principal payments on the mortgage loans in a loan group, the
transferor interest may grow. An increase in the transferor interest due to
additional draws

                                      S-50


may also result in noteholders receiving principal at a greater rate during the
Rapid Amortization Period because the noteholders' share of principal
collections on the mortgage loans in a loan group is based on the applicable
Investor Fixed Allocation Percentage (without reduction). The sale and servicing
agreement and the indenture permit the transferor, at its option, but subject to
the satisfaction of certain conditions specified in the sale and servicing
agreement, including the conditions described below, to remove certain mortgage
loans from a loan group and release them from the lien of the indenture at any
time during the life of the trust fund, so long as the portion of the transferor
interest related to the applicable loan group (after giving effect to the
removal) is not less than the related Minimum Transferor Interest. See
"Description of the Sale and Servicing Agreement -- Optional Transfers of
Mortgage Loans to the Transferor."

         All of the mortgage loans may be prepaid in full or in part at any
time. [However, mortgage loans secured by mortgaged properties in [ ] are
subject to an account termination fee equal to the lesser of $[ ] or [ ] months
interest on the amount prepaid, to the extent the prepaid amount exceeds [ ]% of
the unpaid principal balance, if the account is terminated on or before its [ ]
year anniversary.] In addition, mortgage loans secured by mortgaged properties
[in other jurisdictions] may be subject to account termination fees to the
extent permitted by law. In general, account termination fees do not exceed $[ ]
and do not apply to accounts terminated after a date designated in the related
mortgage note that, depending on the jurisdiction, ranges between [ ] months and
[ ] years following origination. The prepayment experience of the mortgage loans
in a loan group will affect the weighted average life of the related Notes.

         The rate of prepayment on the mortgage loans cannot be predicted.
Generally, it is assumed that home equity revolving credit lines are not viewed
by borrowers as permanent financing. Accordingly, the mortgage loans may
experience a higher rate of prepayment than traditional first mortgage loans. On
the other hand, because the mortgage loans amortize as described in this
prospectus supplement under "Description of the Mortgage Loans -- Mortgage Loan
Terms," rates of principal payments on the mortgage loans will generally be
slower than those of traditional fully-amortizing first mortgages in the absence
of prepayments on the mortgage loans. The prepayment experience of the mortgage
loans in a loan group may be affected by a wide variety of factors, including
general economic conditions, prevailing interest rate levels, the availability
of alternative financing, homeowner mobility, the frequency and amount of any
future draws on the credit line agreements and changes affecting the
deductibility for federal income tax purposes of interest payments on home
equity credit lines. Substantially all of the mortgage loans contain
"due-on-sale" provisions, and the master servicer intends to enforce them,
unless

         o enforcement is not permitted by applicable law or

         o the master servicer permits the purchaser of the related mortgaged
property to assume the mortgage loan in a manner consistent with reasonable
commercial practice.

         The enforcement of a "due-on-sale" provision will have the same effect
as a prepayment of the related mortgage loan. See "Certain Legal Aspects of the
Loans -- Due-on-Sale Clauses" in the prospectus.

         The seller is not required to deliver certain documents relating to the
mortgage loans to the indenture trustee until [30] days after the Closing Date
[(or in the case of the Additional

                                      S-51


Home Equity Loans, until 21 days after they are acquired by the trust fund)].
See "Description of the Sale and Servicing Agreement -- Assignment of Mortgage
Loans." If the seller fails to deliver all or a portion of the required
documents for any mortgage loan to the depositor, or, at the depositor's
direction, to the indenture trustee within the required period, the seller must
accept the transfer of the mortgage loan from the trust fund. The principal
balance of any mortgage loan so transferred will be deducted from the related
loan group balance, thus reducing the amount of the transferor interest related
to relevant loan group. If the deduction would cause the portion of the
transferor interest related to the relevant loan group to become less than the
related Minimum Transferor Interest at the time, the seller must either
substitute an Eligible Substitute Mortgage Loan or make a deposit into the
collection account equal to the amount by which the portion of the transferor
interest would be reduced to less than the related Minimum Transferor Interest
at the time. Except to the extent substituted for by an Eligible Substitute
Mortgage Loan, the transfer of the mortgage loan out of the trust fund will be
treated as a payment in full of the mortgage loan.

         The yield to an investor who purchases the Notes in the secondary
market at a price other than par will vary from the anticipated yield if the
actual rate of prepayment on the mortgage loans in the related loan group is
actually different than the rate anticipated by the investor at the time the
Notes were purchased.

         Collections on the mortgage loans may vary because, among other things,
borrowers may make payments during any month as low as the minimum monthly
payment for the month or as high as the entire outstanding principal balance
plus accrued interest and the fees and charges on the mortgage loan. Borrowers
may fail to make scheduled payments. Collections on the mortgage loans may vary
due to seasonal purchasing and payment habits of borrowers.

         We cannot predict the level of prepayments that will be experienced by
the trust fund and investors may expect that a portion of borrowers will not
prepay their mortgage loans to any significant degree. See "Yield and Prepayment
Considerations" in the prospectus.

                                   POOL FACTOR

         The pool factor is a seven-digit decimal that the indenture trustee
will compute monthly expressing the Note principal balance of each class of
Notes as of each payment date as a proportion of the Original Note Principal
Balance after giving effect to any distribution of principal to that class of
Notes on the payment date. On the Closing Date, the pool factor for each class
of Notes will be 1.0000000. See "Description of the Notes -- Distributions on
the Notes." Thereafter, the pool factor for each class of Notes will decline to
reflect reductions in the related Note principal balance resulting from
distributions of principal to that class of Notes and the related Invested
Amount of any unreimbursed Liquidation Loss Amounts from mortgage loans in the
related loan group.

         Pursuant to the sale and servicing agreement and the indenture, monthly
reports concerning the Invested Amount, the pool factor and various other items
of information for each class of Notes will be made available to the
noteholders. In addition, within [60] days after the end of each calendar year,
beginning with the 200[ ]calendar year, information for tax reporting purposes
will be made available to each person who has been a noteholder of record at any
time

                                      S-52


during the preceding calendar year. See "Description of the Notes -- Book-Entry
Notes" and "Description of the Indenture -- Reports to Noteholders."

                            DESCRIPTION OF THE NOTES

         The Home Equity Loan Asset Backed Notes Class [ ] and Class [ ] (each
is sometimes referred to as a "Class"), Series 200[ ]-[ ] (the "Notes") will be
issued pursuant to the indenture. The form of the indenture has been filed as an
exhibit to the Registration Statement of which this prospectus supplement and
the prospectus is a part.

GENERAL

         The [Class [ ]] Notes will be issued in denominations of $[25,000] and
multiples in excess of that. The repayment of the Class [ ] Notes will be
secured by a securities interest in loan group [ ] and the repayment of the
Class [ ] Notes [(which are not offered by this prospectus supplement)] will be
secured by a security interest in loan group [ ].

         Definitive Notes, if issued, will be transferable and exchangeable at
the corporate trust office of the indenture trustee, which will initially
maintain the note register for the Notes. See " -- Book-Entry Notes" below. No
service charge will be made for any registration of exchange or transfer of
Notes, but the indenture trustee may require payment of a sum sufficient to
cover any tax or other governmental charge.

         The aggregate undivided interest in the trust fund represented by the
Notes as of the Closing Date is expected to equal approximately $[ ] (the
"Original Invested Amount"), which represents approximately 100% of the sum of
the cut-off date pool balance [and the additional loan accounts].

         As of the Closing Date, the principal balance of the Class [ ] Notes is
expected to equal approximately $[ ] (the "Class [ ] Original Invested Amount"),
which represents approximately 100% of the sum of the cut-off date loan group [
] principal balance [and approximately $[ ] deposited in the related additional
loan account]. The "Class [ ] Original Note Principal Balance" is expected to
equal approximately $[ ].

         As of the Closing Date, the principal balance of the Class [ ] Notes is
expected to equal approximately $[ ] (the "Class [ ] Original Invested Amount"),
which represents approximately 100% of the sum of the cut-off date loan group
[ ] principal balance [and the amount deposited in the Additional Loan Account].
The "Class [ ]Original Note Principal Balance" is expected to equal
approximately $[ ]. [Of the Class [ ] Original Invested Amount approximately
$[ ] represents the proceeds deposited into the Additional Loan Account which
may be used through [ ] to purchase additional home equity loans for addition to
loan group [ ].]

         Following the Closing Date, the "Invested Amount" for each class of
Notes for any payment date will be an amount equal to the Original Invested
Amount for the class of Notes minus

                                      S-53


         o the amount of the related Investor Principal Collections previously
distributed on the class of Notes [and any return of the related additional loan
account funds], and minus

         o an amount equal to the product of the related Investor Floating
Allocation Percentage and the Liquidation Loss Amounts on the mortgage loans in
the related loan group for the payment date.

         For each class of Notes, the principal amount of the outstanding Notes
in that class on any payment date is equal to the applicable Original Note
Principal Balance minus the aggregate of amounts actually distributed as
principal to the Notes in that class. See " -- Distributions on the Notes"
below. Each Note represents the right to receive payments of interest at the
related note rate and payments of principal as described below.

         The residual interest in the mortgage loans in the trust fund will be
represented by a single transferor interest that will be owned by the
transferor. The portion of the transferor interest related to a loan group, as
of any date of determination, will equal the related loan group balance as of
the close of business on the day preceding the date of determination, less the
Invested Amount for the loan group as of the close of business on the preceding
payment date.

         The Required Transferor Subordinated Amount initially is approximately
$[ ], which, in the aggregate, will represent approximately [ ]% of the cut-off
date loan group [ ] balance [and the amount originally deposited in the related
additional loan account] plus approximately [ ]% of the cut-off date loan group
[ ] balance [and the amount originally deposited in the Additional Loan
Account], but the indenture requires the transferor interest (once it is fully
funded) to be at least equal to the Minimum Transferor Interest. The owner of
the transferor interest will initially be the seller (or one of its affiliates).
In general, the loan group balance of each loan group will vary each day as
principal is paid on the mortgage loans in that loan group, liquidation losses
are incurred and Additional Balances are drawn down by borrowers on mortgage
loans in that loan group and transferred to the related loan group.

         The Note Insurer requires, based on the Insurance Agreement, that the
portion of the transferor's interest related to each class of Notes be
maintained at the related Required Transferor Subordinated Amount for the class.
The portion of the transferor's interest related to each class of Notes as of
the closing date will be zero, which is less than the initial Required
Transferor Subordinated Amount, thus requiring an increase in the transferor's
interest on future payment dates until it equals the Required Transferor
Subordinated Amount.

BOOK-ENTRY NOTES

         The [Class [ ]] Notes will be book-entry notes. Persons acquiring
beneficial ownership interests in the [Class [ ]] Notes may elect to hold their
[Class [ ]] Notes through the Depository Trust Company in the United States, or
Clearstream, Luxembourg or Euroclear in Europe, if they are participants of
those systems, or indirectly through organizations that are participants in
those systems. The book-entry notes will be issued in one or more notes that
equal the aggregate principal balance of the [Class [ ]] Notes and will
initially be registered in the name of Cede & Co., the nominee of DTC.
Clearstream, Luxembourg and Euroclear will hold omnibus positions on behalf of
their participants through customers' securities accounts in Clearstream,
Luxembourg's and Euroclear's names on the books of their respective
depositaries,

                                      S-54


which in turn will hold positions in customers' securities accounts in the
depositaries' names on the books of DTC. Citibank N.A. will act as depositary
for Clearstream, Luxembourg and The Chase Manhattan Bank will act as depositary
for Euroclear. Investors may hold beneficial interests in the book-entry notes
in minimum denominations representing [Class [ ]] Note principal balances of
$[1,000] and in multiples in excess of that. Except as described below, no
person acquiring a book-entry note will be entitled to receive a definitive note
representing the [Class [ ]] Note. Until definitive notes are issued, Cede &
Co., as nominee of DTC, is expected to be the only "noteholder" of the [Class
[ ]] Notes. Beneficial owners of [Class [ ]] Notes will not be noteholders as
that term is used in the indenture. Beneficial owners of [Class [ ]] Notes are
only permitted to exercise their rights indirectly through the participating
organizations that use the services of DTC, including securities brokers and
dealers, banks and trust companies and clearing corporations and certain other
organizations and DTC.

         The beneficial owner's ownership of a book-entry note will be recorded
on the records of the brokerage firm, bank, thrift institution or other
financial intermediary that maintains the beneficial owner's account for that
purpose. In turn, the financial intermediary's ownership of the book-entry note
will be recorded on the records of DTC (or of a participating firm that acts as
agent for the financial intermediary, whose interest will in turn be recorded on
the records of DTC, if the beneficial owner's financial intermediary is not a
DTC participant and on the records of Clearstream, Luxembourg or Euroclear, as
appropriate).

         Beneficial owners of [Class [ ]] Notes will receive all distributions
of principal of, and interest on, the [Class [ ]] Notes from the indenture
trustee through DTC and DTC participants. While the [Class [ ]] Notes are
outstanding (except under the circumstances described below), under the rules,
regulations and procedures creating and affecting DTC and its operations (the
"Rules"), DTC must make book-entry transfers among participants on whose behalf
it acts with respect to the [Class [ ]] Notes and must receive and transmit
distributions of principal of, and interest on, the [Class [ ]] Notes.
Participants and organizations that have indirect access to the DTC system, such
as banks, brokers, dealers, trust companies and other indirect participants that
clear through or maintain a custodial relationship with a participant, either
directly or indirectly, with whom beneficial owners of [Class [ ]] Notes have
accounts for [Class [ ]] Notes are similarly required to make book-entry
transfers and receive and transmit distributions on behalf of their respective
beneficial owners of [Class [ ]] Notes. Accordingly, although beneficial owners
of [Class [ ]] Notes will not possess [Class [ ]] Notes, the Rules provide a
mechanism by which beneficial owners of [Class [ ]] Notes will receive
distributions and will be able to transfer their interest.

         Beneficial owners of [Class [ ]] Notes will not receive or be entitled
to receive notes representing their respective interests in the [Class [ ]]
Notes, except under the limited circumstances described below. Until definitive
notes are issued, beneficial owners of [Class [ ]] Notes who are not
participants may transfer ownership of [Class [ ]] Notes only through
participants and indirect participants by instructing them to transfer [Class
[ ]] Notes, by book-entry transfer, through DTC for the account of the
purchasers of the [Class [ ]] Notes, which account is maintained with their
respective participants. Under the Rules and in accordance with DTC's normal
procedures, transfers of ownership of [Class [ ]] Notes will be executed through
DTC and the accounts of the respective participants at DTC will be debited and
credited. Similarly, the participants and indirect participants will make debits
or credits, as the case may

                                      S-55


be, on their records on behalf of the selling and purchasing beneficial owners
of [Class [ ]] Notes.

         Because of time zone differences, credits of securities received in
Clearstream, Luxembourg or Euroclear as a result of a transaction with a
participant will be made during subsequent securities settlement processing and
dated the business day following the DTC settlement date. Those credits or any
transactions in those securities will be reported to the relevant Euroclear or
Clearstream, Luxembourg participants on the business day following the DTC
settlement date. Cash received in Clearstream, Luxembourg or Euroclear as a
result of sales of securities by or through a Clearstream, Luxembourg
participant or Euroclear participant to a DTC participant will be received with
value on the DTC settlement date but will be available in the relevant
Clearstream, Luxembourg or Euroclear cash account only as of the business day
following settlement in DTC. For information with respect to tax documentation
procedures relating to the Notes, see "Material Federal Income Tax Consequences
-- Foreign Investors" and " -- Backup Withholding" in this prospectus supplement
and "Global Clearance, Settlement And Tax Documentation Procedures -- Certain
U.S. Federal Income Tax Documentation Requirements" in Annex I hereto.

         Transfers between participants will occur in accordance with DTC rules.
Transfers between Clearstream, Luxembourg participants and Euroclear
participants will occur in accordance with their respective rules and operating
procedures.

         Cross-market transfers between persons holding directly or indirectly
through DTC, on the one hand, and directly or indirectly through Clearstream,
Luxembourg participants or Euroclear participants, on the other, will be
effected in DTC in accordance with DTC rules and on behalf of the relevant
European international clearing system by the relevant depositary. However,
these cross market transactions will require delivery of instructions to the
relevant European international clearing system by the counterparty in the
relevant European international clearing system in accordance with its rules and
procedures and within its established deadlines (European time). The relevant
European international clearing system will, if the transaction meets its
settlement requirements, deliver instructions to the relevant depositary to take
action to effect final settlement on its behalf by delivering or receiving
securities in DTC, and making or receiving payment in accordance with normal
procedures for same day funds settlement applicable to DTC. Clearstream,
Luxembourg participants and Euroclear participants may not deliver instructions
directly to the European depositaries.

         DTC, which is a New York-chartered limited purpose trust company,
performs services for its participants, some of which (or their representatives)
own DTC. In accordance with its normal procedures, DTC is expected to record the
positions held by each DTC participant in the book-entry notes, whether held for
its own account or as a nominee for another person. In general, beneficial
ownership of book-entry notes will be subject to the rules, regulations and
procedures governing DTC and DTC participants as in effect from time to time.

         Clearstream Banking, societe anonyme, 67 Bd Grande-Duchesse Charlotte,
L-2967 Luxembourg ("Clearstream, Luxembourg"), was incorporated in 1970 as
"Cedel S.A," a company with limited liability under Luxembourg law (a societe
anonyme). Cedel S.A. subsequently changed its name to Cedelbank. On January 10,
2000, Cedelbank's parent

                                      S-56


company, Cedel International, societe anonyme merged its clearing, settlement
and custody business with that of Deutsche Borse Clearing AG. The merger
involved the transfer by Cedel International of substantially all of its assets
and liabilities to a new Luxembourg company, New Cedel International, societe
anonyme, which is 50% owned by Cedel International and 50% owned by Deutsche
Borse Clearing AG's parent company Deutsche Borse AG. The shareholders of these
two entities are banks, securities dealers and financial institutions. Cedel
International currently has 92 shareholders, including U.S. financial
institutions or their subsidiaries. No single entity may own more than 5 percent
of Cedel International's stock.

         In furtherance of the merger, the Board of Directors of New Cedel
International decided to re-name the companies in the group to give them a
cohesive brand name. The new brand name that was chosen is "Clearstream."
Effective January 14, 2000, New Cedel International has been renamed
"Clearstream International, societe anonyme." On January 18, 2000, Cedelbank was
renamed "Clearstream Banking, societe anonyme," and Cedel Global Services was
renamed "Clearstream Services, societe anonyme." On January 17, 2000 Deutsche
Borse Clearing AG was renamed "Clearstream Banking AG." This means that there
are now two entities in the corporate group headed by Clearstream International
that share the name "Clearstream Banking," the entity previously named
"Cedelbank" and the entity previously named "Deutsche Borse Clearing AG."

         Clearstream, Luxembourg holds securities for its customers and
facilitates the clearance and settlement of securities transactions between
Clearstream, Luxembourg customers through electronic book-entry changes in
accounts of Clearstream, Luxembourg customers, thereby eliminating the need for
physical movement of notes. Transactions may be settled by Clearstream,
Luxembourg in any of 36 currencies, including United States dollars.
Clearstream, Luxembourg provides to its customers, among other things, services
for safekeeping, administration, clearance and settlement of internationally
traded securities and securities lending and borrowing. Clearstream, Luxembourg
also deals with domestic securities markets in over 30 countries through
established depository and custodial relationships. Clearstream, Luxembourg is
registered as a bank in Luxembourg, and as such is subject to regulation by the
Commission de Surveillance du Secteur Financier, which supervises Luxembourg
banks. Clearstream, Luxembourg's customers are world-wide financial institutions
including underwriters, securities brokers and dealers, banks, trust companies
and clearing corporations. Clearstream, Luxembourg's U.S. customers are limited
to securities brokers and dealers, and banks. Currently, Clearstream, Luxembourg
has approximately 2,000 customers located in over 80 countries, including all
major European countries, Canada, and the United States. Indirect access to
Clearstream, Luxembourg is available to other institutions that clear through or
maintain a custodial relationship with an account holder of Clearstream,
Luxembourg. Clearstream, Luxembourg has established an electronic bridge with
Euroclear Bank S.A./N.V as the Operator of the Euroclear System (MGT/EOC) in
Brussels to facilitate settlement of trades between Clearstream, Luxembourg and
MGT/EOC.

         Euroclear was created in 1968 to hold securities for participants of
Euroclear and to clear and settle transactions between Euroclear participants
through simultaneous electronic book-entry delivery against payment, thereby
eliminating the need for physical movement of notes and any risk from lack of
simultaneous transfers of securities and cash. Transactions may now be

                                      S-57


settled in any of 32 currencies, including United States dollars. Euroclear
includes various other services, including securities lending and borrowing and
interfaces with domestic markets in several countries generally similar to the
arrangements for cross-market transfers with DTC described above. Euroclear is
operated by Euroclear Bank S.A./N.V. All operations are conducted by the
Euroclear operator, and all Euroclear securities clearance accounts and
Euroclear cash accounts are accounts with the Euroclear operator, not Euroclear
Clearance Systems S.C. Euroclear Clearance Systems S.C. establishes policy for
Euroclear on behalf of Euroclear participants. Euroclear participants include
banks (including central banks), securities brokers and dealers and other
professional financial intermediaries. Indirect access to Euroclear is also
available to other firms that clear through or maintain a custodial relationship
with a Euroclear participant, either directly or indirectly.

         The Euroclear operator is Euroclear Bank S.A./N.V.

         Securities clearance accounts and cash accounts with the Euroclear
operator are governed by the Terms and Conditions Governing Use of Euroclear and
the related Operating Procedures of the Euroclear System and applicable Belgian
law. The Terms and Conditions govern transfers of securities and cash within
Euroclear, withdrawals of securities and cash from Euroclear, and receipts of
payments with respect to securities in Euroclear. All securities in Euroclear
are held on a fungible basis without attribution of specific notes to specific
securities clearance accounts. The Euroclear operator acts under the Terms and
Conditions only on behalf of Euroclear participants, and has no record of or
relationship with persons holding through Euroclear participants.

         Distributions on the book-entry notes will be made on each payment date
by the indenture trustee to DTC. DTC will be responsible for crediting the
amount of the distributions to the accounts of the applicable DTC participants
in accordance with DTC's normal procedures. Each DTC participant will be
responsible for disbursing the distributions to the beneficial owners of the
book-entry notes that it represents and to each financial intermediary for which
it acts as agent. Each financial intermediary will be responsible for disbursing
funds to the beneficial owners of the book-entry notes that it represents.

         Under a book-entry format, beneficial owners of the book-entry notes
may experience some delay in their receipt of payments, since payments will be
forwarded by the indenture trustee to Cede & Co. Distributions on [Class [ ]]
Notes held through Clearstream, Luxembourg or Euroclear will be credited to the
cash accounts of Clearstream, Luxembourg participants or Euroclear participants
in accordance with the relevant system's rules and procedures, to the extent
received by the relevant depositary. The distributions will be subject to tax
reporting in accordance with relevant United States tax laws and regulations.
See "Material Federal Income Tax Consequences -- Foreign Investors" and " --
Backup Withholding" in this prospectus supplement. Because DTC can only act on
behalf of financial intermediaries, the ability of a beneficial owner to pledge
book-entry notes to persons or entities that do not participate in the
depository system, or otherwise take actions in respect of book-entry notes, may
be limited due to the lack of physical notes for book-entry notes. In addition,
issuance of the book-entry notes in book-entry form may reduce the liquidity of
[Class [ ]] Notes in the secondary market since certain potential investors may
be unwilling to purchase [Class [ ]] Notes for which they cannot obtain
definitive notes.

                                      S-58


         Monthly and annual reports on the trust fund provided by the master
servicer to Cede & Co., as nominee of DTC, may be made available to beneficial
owners upon request, in accordance with the rules, regulations and procedures
creating and affecting DTC or the relevant depositary, and to the financial
intermediaries to whose DTC accounts the book-entry notes of the beneficial
owners are credited.

         DTC has advised the transferor and the indenture trustee that, until
definitive notes are issued, DTC will take any action permitted to be taken by
the holders of the book-entry notes under the indenture only at the direction of
one or more financial intermediaries to whose DTC accounts the book-entry notes
are credited, to the extent that the actions are taken on behalf of financial
intermediaries whose holdings include the book-entry notes. Clearstream,
Luxembourg or the Euroclear operator, as the case may be, will take any other
action permitted to be taken by a noteholder under the indenture on behalf of a
Clearstream, Luxembourg participant or Euroclear participant only in accordance
with its relevant rules and procedures and subject to the ability of the
relevant depositary to effect the actions on its behalf through DTC. DTC may
take actions, at the direction of the related participants, for some [Class [ ]]
Notes that conflict with actions taken for other [Class [ ]] Notes.

         Definitive notes will be issued to beneficial owners of the book-entry
notes, or their nominees, rather than to DTC, only if

         o DTC or the transferor advises the indenture trustee in writing that
DTC is no longer willing, qualified or able to discharge properly its
responsibilities as nominee and depositary with respect to the book-entry notes
and the transferor or the indenture trustee is unable to locate a qualified
successor,

         o the transferor, at its sole option, elects to terminate a book-entry
system through DTC or

         o after the occurrence of an Event of Servicing Termination, beneficial
owners having interests aggregating not less than 51% of the Note principal
balance of the book-entry notes advise the indenture trustee and DTC through the
financial intermediaries and the DTC 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 beneficial owners.

         Upon the availability of definitive notes, the indenture trustee will
be required to notify all beneficial owners of the occurrence of the event
resulting in their availability and the availability through DTC of definitive
notes. Upon surrender by DTC of the global notes representing the book-entry
notes and instructions for re-registration, the indenture trustee will issue
definitive notes, and thereafter the indenture trustee will recognize the
holders of definitive notes as noteholders under the indenture.

         Although DTC, Clearstream, Luxembourg and Euroclear have agreed to the
foregoing procedures to facilitate transfers of [Class [ ]] Notes among
participants of DTC, Clearstream, Luxembourg and Euroclear, they are under no
obligation to perform or continue to perform these procedures and these
procedures may be discontinued at any time.

                                      S-59


         The foregoing information with respect to DTC has been provided for
informational purposes only and is not a representation, warranty, or contract
modification of any kind by DTC.

DISTRIBUTIONS ON THE NOTES

         Beginning with the first payment date (which will occur on [ ]),
distributions on the Notes will be made by the indenture trustee or the paying
agent on each payment date to the persons in whose names the Notes are
registered at the close of business on the day before each payment date or, if
the Notes are no longer book-entry notes, at the close of business on the record
date (which is the day before a distribution date, so long as the notes are
book-entry notes or, if the notes are no longer book-entry notes, the [last] day
of the month preceding the payment date). The term payment date means the
[fifteenth] day of each month or, if that day is not a business day, then the
next business day. Generally, distributions on the [Class [ ]] Notes will be
made by check or money order mailed to the address of the person entitled to it
(which, in the case of book-entry notes, will be DTC or its nominee) as it
appears on the note register on the determination date. At the request of a
noteholder owning at least $[1,000,000] principal amount of Notes, distributions
will be made by wire transfer or as otherwise agreed between the noteholder and
the indenture trustee. However, the final distribution on the Notes will be made
only on their presentation and surrender at the office or the agency of the
indenture trustee specified in the notice to noteholders of the final
distribution. A "business day" is any day other than a Saturday or Sunday or a
day on which banking institutions in the states of New York, [California or [ ]]
are required or authorized by law to be closed.

         Application of Interest Collections. On each payment date, the
indenture trustee or a paying agent will apply the Investor Interest Collections
for [a] loan group [ ] in the following order of priority:

         (1)   to pay the indenture trustee's fees under the indenture and the
               owner trustee's fees under the trust;

         (2)   to pay the Note Insurer for the portion of the premium for the
               Policy [related to loan group [ ]];

         (3)   to pay noteholders the interest accrued at the related note rate
               and any overdue accrued interest (with interest on overdue
               interest to the extent permitted by applicable law) on the
               principal balance of the Notes;

         (4)   to pay noteholders the related Investor Loss Amount for the
               payment date;

         (5)   to pay noteholders for any related Investor Loss Amount for a
               previous payment date that was not previously (a) funded by
               related Investor Interest Collections, (b) absorbed by a
               reduction in the related portion of the transferor interest, (c)
               funded by related Subordinated Transferor Collections [, (d)
               funded by the Reserve Fund, (e) funded pursuant to clause (9)
               below] or (f) funded by draws on the Policy;

         (6)   to reimburse the Note Insurer for prior draws made from the
               Policy (with interest on the draws);

                                      S-60


         (7)   to pay noteholders the principal of the Notes until the related
               portion of the transferor interest equals the related Required
               Transferor Subordinated Amount (the principal so paid, the
               "Accelerated Principal Distribution Amount");

         (8)   to pay any other amounts owed to the Note Insurer pursuant to the
               Insurance Agreement;

         (9)   [to pay the other class of notes any deficiency in items (3), (4)
               and (5) above, after taking into account the allocation of 100%
               of the other class' Investor Interest Collections on the payment
               date (the amount of one class' remaining Investor Interest
               Collections allocated to the other class on a payment date is a
               "Crossover Amount");]

         (10)  [to the Reserve Fund for application in accordance with the
               indenture, to the extent that the sum of the portion of the
               transferor's interest for [both] loan groups as of the payment
               date is less than the sum of the Required Transferor Subordinated
               Amounts for [both] loan groups as of the payment date;]

         (11)  to pay the master servicer amounts required to be paid pursuant
               to the sale and servicing agreement;

         (12)  to pay the noteholders any Basis Risk Carryforward of the Notes;
               and

         (13)  the remaining amounts to the transferor.

         Payments to noteholders pursuant to clause (3) will be interest
payments on the Notes. Payments to noteholders pursuant to clauses (4), (5) and
(7) will be principal payments on the Notes and will therefore reduce the
related Note principal balance; however, payments pursuant to clause (7) will
not reduce the related Invested Amount. The Accelerated Principal Distribution
Amount for a Class is not guaranteed by the Policy.

         [On each payment date, if Investor Interest Collections for a class of
Notes, plus any Crossover Amount available from the other class of Notes, are
insufficient to pay the amounts specified in items (3), (4) and (5) above for a
class of Notes, the amount of the insufficiency shall be withdrawn from the
Reserve Fund to the extent of funds on deposit in it.]

         [The amount on deposit in the Reserve Fund will not exceed the excess
of (x) the sum of the Required Transferor Subordinated Amounts for [both] loan
groups over (y) the sum of the portion of the transferor's interest for each
loan group. Amounts in the Reserve Fund may only be withdrawn and applied in
accordance with the indenture.]

         To the extent that Investor Interest Collections from a loan group are
applied to pay the interest on the related class of Notes, Investor Interest
Collections for that loan group may be insufficient to cover related Investor
Loss Amounts. If this insufficiency exists after the related Available
Transferor Subordinated Amount[, the Crossover Amount and the Reserve Fund]
[have each] [has] been reduced to zero and results in the related Note principal
balance exceeding the related Invested Amount, a draw will be made on the Policy
in accordance with the Policy.

         The "Investor Loss Amount" for a loan group is the product of the
Investor Floating Allocation Percentage for that loan group and the Liquidation
Loss Amount for that loan group

                                      S-61


for the payment date. The Investor Loss Amount for a loan group will be
allocated to the Notes related to that loan group.

         The "Liquidation Loss Amount" for any Liquidated Mortgage Loan is its
unrecovered principal balance at the end of the Collection Period in which the
mortgage loan became a Liquidated Mortgage Loan, after giving effect to its Net
Liquidation Proceeds.

         A "Liquidated Mortgage Loan" means, as to any payment date, any
mortgage loan in respect of which the master servicer has determined, based on
the servicing procedures specified in the sale and servicing agreement, as of
the end of the preceding Collection Period, that all liquidation proceeds that
it expects to recover in the disposition of the mortgage loan or the related
mortgaged property have been recovered.

         The "Collection Period" related to a payment date is the calendar month
preceding the payment date (or, in the case of the first Collection Period, the
period beginning on the cut-off date and ending on the last day of [ ], 200[ ]).

         Interest will be distributed on each payment date at the applicable
note rate for the related Interest Period. The note rate for the [Class [ ]]
Notes for a payment date will generally equal a per annum rate equal to [the
least of]:

(a) the sum of

         o the London Interbank offered rate for one-month United States dollar
deposits ("LIBOR"), plus

         o [ ]% [for the Class [ ] Notes and [ ]% for the Class [ ] Notes];

(b) [a per annum rate equal to the weighted average of the loan rates of the
mortgage loans in loan group [ ] net of

         o the servicing fee rate,

         o the rate at which the fees payable to the indenture trustee and the
owner trustee are calculated,

         o the rate at which the premium payable to the Note Insurer [and the
guaranty fee [to Fannie Mae] are each] [is] calculated and,

         o commencing with the payment date in [ ], [ ]% per annum, weighted on
the basis of the daily average balance of each mortgage loan included in loan
group [ ], during the related billing cycle before the Collection Period
relating to the payment date, and

(c) [ ]%.]

However, on any payment date for which the note rate for a class of notes has
been determined pursuant to clause (b) of note rate, the excess of

         o the amount of interest that would have accrued on those notes during
the related Interest Period had interest been determined pursuant to clause (a)
of note rate (but not at a rate in excess of [ ]% per annum) over

                                      S-62


         o the interest actually accrued on those notes during the Interest
Period (the excess is referred to as "Basis Risk Carryforward")

will accrue interest at the note rate calculated pursuant to clause (a) (as
adjusted from time to time), but not to exceed clause (c), and will be paid on
subsequent payment dates to the extent funds are available therefor.

         Interest on the Notes for any payment date will accrue on the Note
principal balance from the preceding payment date (or in the case of the first
payment date, from the Closing Date) through the day preceding the payment date
(each period, an "Interest Period") on the basis of the actual number of days in
the Interest Period and a 360-day year. Interest payments on the Notes will be
funded from Investor Interest Collections, Subordinated Transferor Collections,
[the Reserve Fund,] and, if necessary, from draws on the Policy.

         Calculation of the LIBOR Rate. On each reset date, the indenture
trustee shall determine LIBOR for the Interest Period commencing on the payment
date. The reset date for each Interest Period is the second LIBOR business day
before the payment date. LIBOR for the first Interest Period will be determined
on the second LIBOR business day before the Closing Date. LIBOR will equal the
rate for United States dollar deposits for one month that appears on the
Telerate Screen Page 3750 as of 11:00 A.M., London time, on the reset date for
an Interest Period. Telerate Screen Page 3750 means the display designated as
page 3750 on the Bridge Telerate Service (or any page replacing page 3750 on
that service for the purpose of displaying London interbank offered rates of
major banks). If such rate does not appear on Telerate Screen Page 3750 (or if
that service is no longer offered, another service for displaying LIBOR or
comparable rates selected by the depositor after consultation with the indenture
trustee), the rate will be the reference bank rate. The reference bank rate will
be determined on the basis of the rates at which deposits in United States
dollars are offered by the reference banks as of 11:00 a.m., London time, on the
reset date for the Interest Period to prime banks in the London interbank market
for a period of one month in amounts approximately equal to the principal amount
of the Notes then outstanding. The reference banks will be three major banks
that are engaged in transactions in the London interbank market selected by the
depositor after consultation with the indenture trustee. The indenture trustee
will request the principal London office of each of the reference banks to
provide a quotation of its rate. If at least two such quotations are provided,
the rate will be the arithmetic mean of the quotations. If on the reset date
fewer than two quotations are provided as requested, the rate will be the
arithmetic mean of the rates quoted by one or more major banks in New York City,
selected by the depositor after consultation with the indenture trustee, as of
11:00 A.M., New York City time, on the reset date for loans in United States
dollars to leading European banks for a period of one month in amounts
approximately equal to the principal amount of the Notes then outstanding. If no
such quotations can be obtained, the rate will be LIBOR for the preceding
Interest Period. LIBOR business day means any day other than a Saturday or a
Sunday or a day on which banking institutions in the State of New York or in the
city of London, England are required or authorized by law to be closed.

         Transferor Collections. Collections allocable to the transferor
interest in respect of a loan group will be distributed to the transferor only
to the extent that the distribution will not reduce the amount of the portion of
the transferor interest relating to that loan group as of the related payment
date below the applicable Minimum Transferor Interest. Amounts not distributed
to the

                                      S-63


transferor because of these limitations will be retained in the collection
account until the portion of the transferor interest relating to each loan group
exceeds the applicable Minimum Transferor Interest, at which time the excess
shall be released to the transferor. Any of these amounts in the collection
account at the start of the Rapid Amortization Period will be paid to the
noteholders of the related class of notes as a reduction of the related Note
principal balance.

         Distributions of Principal Collections. For each loan group, the period
beginning on the Closing Date and, unless a Rapid Amortization Event shall have
earlier occurred, through and including the payment date in [ ] is the "Managed
Amortization Period." The amount of principal collections payable to noteholders
for each payment date during the Managed Amortization Period will equal, to the
extent funds are available therefor, the Scheduled Principal Collections
Distribution Amount for the loan group and payment date. The Scheduled Principal
Collections Distribution Amount for the first Collection Period is computed for
the period beginning on the cut-off date and ending on the last day of [ ]. On
any payment date during the Managed Amortization Period, the "Scheduled
Principal Collections Distribution Amount" for a loan group is the lesser of the
applicable Maximum Principal Payment and the applicable Alternative Principal
Payment. For any loan group and payment date, the "Maximum Principal Payment" is
the product of the Investor Fixed Allocation Percentage for the loan group and
principal collections for the loan group and payment date. For any loan group
and payment date, the "Alternative Principal Payment" for the loan group is the
sum of the amount of principal collections for the loan group and payment date
minus the aggregate of Additional Balances created on the mortgage loans in that
loan group during the related Collection Period, but not less than zero.

         Beginning with the first payment date following the end of the Managed
Amortization Period (the "Rapid Amortization Period"), the amount of principal
collections payable to noteholders on each payment date will be equal to the
Maximum Principal Payment for that loan group.

         If on any payment date the Required Transferor Subordinated Amount for
a loan group is reduced below the then existing Available Transferor
Subordinated Amount for that loan group, the amount of principal collections
from the mortgage loans in that loan group payable to noteholders on the payment
date will be correspondingly reduced by the amount of the reduction.

         Distributions of principal collections from the mortgage loans in a
loan group based on the related Investor Fixed Allocation Percentage may result
in distributions of principal to the related noteholders in amounts that are
greater relative to the declining balance of that loan group than would be the
case if the related Investor Floating Allocation Percentage were used to
determine the percentage of principal collections distributed in respect of such
Invested Amount. Principal collections from the mortgage loans in a loan group
not allocated to the noteholders will be allocated to the portion of the
transferor interest related to that loan group. The aggregate distributions of
principal to the noteholders will not exceed the Original Note Principal
Balance.

         In addition, to the extent of funds available therefor (including funds
available under the Policy), on the payment date in [ ], noteholders will be
entitled to receive as a payment of principal an amount equal to the outstanding
Note principal balance.

                                      S-64


         The Paying Agent. The paying agent shall initially be the indenture
trustee. The paying agent shall have the revocable power to withdraw funds from
the collection account for the purpose of making distributions to the
noteholders.

LIMITED SUBORDINATION OF TRANSFEROR INTEREST

         If Investor Interest Collections[, Crossover Amounts and amounts on
deposit in the Reserve Fund] on any payment date are insufficient to pay (i)
accrued interest due and any overdue accrued interest (with interest on overdue
interest to the extent permitted by applicable law) on the related Notes and
(ii) the applicable Investor Loss Amount on the payment date (the insufficiency
being the "Required Amount"), a portion of the interest collections from the
mortgage loans in that loan group and principal collections allocable to the
portion of the transferor interest related to that loan group (but not in excess
of the applicable Available Transferor Subordinated Amount) (the "Subordinated
Transferor Collections") will be applied to cover the Required Amount for that
loan group. The portion of the Required Amount for a loan group in respect of
clause (ii) above not covered by the Subordinated Transferor Collections will be
reallocated to the portion of the transferor interest related to that loan
group, thereby reducing the transferor interest (up to the applicable remaining
Available Transferor Subordinated Amount and not in excess of the Investor Loss
Amounts for that loan group). The portion of the Required Amount not covered by
the application of funds pursuant to the preceding sentence may then be
satisfied by amounts available from the remaining Available Transferor
Subordinated Amount from the other loan group. If the Investor Interest
Collections for a loan group[, Crossover Amounts, amounts on deposit in the
Reserve Fund] and the amount of Subordinated Transferor Collections that have
been so applied to cover the applicable Required Amount are together
insufficient to pay the amounts in item (i) of the definition of Required
Amount, then a draw will be made on the Policy to cover the amount of the
shortfall. In addition, if on any payment date on which the Available Transferor
Subordinated Amount for a loan group is reduced to zero the Note principal
balance for that loan group exceeds the applicable Invested Amount (after giving
effect to all allocations and distributions of principal to be made on the Notes
on the payment date), a draw will be made on the Policy in the amount of the
excess. See "Description of the Indenture -- The Policy."

         The "Available Transferor Subordinated Amount" for any payment date and
loan group is the lesser of the portion of the transferor interest for that loan
group and the related Required Transferor Subordinated Amount for the payment
date.

                          DESCRIPTION OF THE INDENTURE

         The following is a description of the material provisions of the
indenture. Wherever particular defined terms of the indenture are referred to,
the defined terms are incorporated in this prospectus supplement by this
reference.

PAYMENTS ON MORTGAGE LOANS; DEPOSITS TO COLLECTION ACCOUNT

         The master servicer will establish and maintain a collection account in
trust for the noteholders, the transferor, the Note Insurer [and any other third
party credit enhancer], as their interests may appear. The collection account
will be an Eligible Account. Except for amounts

                                      S-65


representing administrative charges, annual fees, taxes, assessments, credit
insurance charges, insurance proceeds to be applied to the restoration or repair
of a mortgaged property, or similar items, the master servicer will deposit all
amounts collected on the mortgage loans in the collection account within two
business days of receipt.

         Amounts deposited in the collection account may be invested in Eligible
Investments maturing no later than one business day before the next payment date
or on the next payment date if approved by the Rating Agencies, the Note Insurer
[and any other third party credit enhancer]. Not later than the [fifth] business
day before each payment date (the "Determination Date"), the master servicer
will notify the indenture trustee of the amount of the deposit to be included in
funds available for the related payment date.

An "Eligible Account" is

         o an account that is maintained with a depository institution whose
debt obligations throughout the time of any deposit in it have the highest
short-term debt rating by the Rating Agencies,

         o an account with a depository institution having a minimum long-term
unsecured debt rating of ["BBB" by Standard & Poor's and "Baa3" by Moody's],
which accounts are fully insured by either the Savings Association Insurance
Fund or the Bank Insurance Fund of the Federal Deposit Insurance Corporation,

         o a segregated trust account maintained with the indenture trustee or
an affiliate of the indenture trustee in its fiduciary capacity or

         o otherwise acceptable to each Rating Agency and the Note Insurer as
evidenced by a letter from each Rating Agency and the Note Insurer to the
indenture trustee, without reduction or withdrawal of each Rating Agency's then
current ratings of the Notes without regard to the Policy [or any other third
party credit enhancement].

Eligible Investments are limited to:

         o obligations of the United States;

         o obligations of any agency of the United States the timely payment of
which are backed by the full faith and credit of the United States;

         o general obligations of or obligations guaranteed by any state of the
United States or the District of Columbia receiving the highest long-term debt
rating of each Rating Agency, or such lower rating as will not result in the
downgrading or withdrawal of the ratings then assigned to the Notes by each
Rating Agency without regard to the Policy [or any other third party credit
enhancement];

         o commercial paper issued by [IndyMac Bank, F.S.B.] or any of its
affiliates that is rated no lower than ["A-1" by Standard & Poor's and "P-2" by
Moody's] if the long-term debt of [IndyMac Bank, F.S.B.] is rated at least [A3
by Moody's], or such lower ratings as will not result in the downgrading or
withdrawal of the rating then assigned to the Notes by any Rating Agency without
regard to the Policy [or any other third party credit enhancement];

                                      S-66


         o commercial or finance company paper that is then receiving the
highest commercial or finance company paper rating of each Rating Agency, or
such lower rating as will not result in the downgrading or withdrawal of the
ratings then assigned to the Notes by any Rating Agency without regard to the
Policy [or any other third party credit enhancement];

         o notes of deposit, demand or time deposits, or bankers' acceptances
issued by any depository institution or trust company incorporated under the
laws of the United States or any of its states and subject to supervision and
examination by federal or state banking authorities, if the commercial paper or
long term unsecured debt obligations of the depository institution or trust
company (or in the case of the principal depository institution in a holding
company system, the commercial paper or long-term unsecured debt obligations of
the holding company, but only if Moody's is not a Rating Agency) are then rated
one of the two highest long-term and the highest short-term ratings of each
Rating Agency for the securities, or such lower ratings as will not result in
the downgrading or withdrawal of the rating then assigned to the Notes by any
Rating Agency without regard to the Policy [or any other third party credit
enhancement];

         o demand or time deposits or notes of deposit issued by any bank or
trust company or savings institution to the extent that the deposits are fully
insured by the FDIC;

         o guaranteed reinvestment agreements issued by any bank, insurance
company or other corporation containing, at the time of the issuance of the
agreements, such conditions as will not result in the downgrading or withdrawal
of the rating then assigned to the Notes by any Rating Agency without regard to
the Policy [or any other third party credit enhancement];

         o repurchase obligations with respect to any security described in the
first and second bullet points, in either case entered into with a depository
institution or trust company (acting as principal) described in the fifth bullet
point;

         o securities (other than stripped bonds, stripped coupons, or
instruments sold at a purchase price in excess of 115% of their face amount)
bearing interest or sold at a discount issued by any corporation incorporated
under the laws of the United States or any of its states that, at the time of
the investment, have one of the two highest ratings of each Rating Agency
(except if the Rating Agency is Moody's, the rating shall be the highest
commercial paper rating of Moody's for the securities), or such lower rating as
will not result in the downgrading or withdrawal of the rating then assigned to
the Notes by any Rating Agency without regard to the Policy [or any other third
party credit enhancement], as evidenced by a signed writing delivered by each
Rating Agency;

         o interests in any money market fund that at the date of acquisition of
the interests in the fund and throughout the time the interests are held has the
highest applicable rating by each Rating Agency, or such lower rating as will
not result in the downgrading or withdrawal of the ratings then assigned to the
Notes by each Rating Agency without regard to the Policy [or any other third
party credit enhancement];

         o short term investment funds sold by any trust company or national
banking association incorporated under the laws of the United States or any of
its states that on the date of acquisition has been rated by each Rating Agency
in their respective highest applicable rating category, or such lower rating as
will not result in the downgrading or withdrawal of the ratings then assigned to
the Notes by each Rating Agency without regard to the Policy [or any other third
party credit enhancement]; and

                                      S-67


         o any other investments having a specified stated maturity and bearing
interest or sold at a discount acceptable to each Rating Agency that will not
result in the downgrading or withdrawal of the rating then assigned to the Notes
by any Rating Agency without regard to the Policy [or any other third party
credit enhancement], as evidenced by a signed writing delivered by each Rating
Agency.

However, no instrument is an Eligible Investment if it evidences the right to
receive

         o interest only payments on the obligations underlying it or

         o both principal and interest payments derived from obligations
underlying the instrument and the interest and principal payments from the
instrument provide a yield to maturity at par greater than 120% of the yield to
maturity at par of the underlying obligations.

No instrument otherwise described as an Eligible Investment may be purchased at
a price greater than par if it may be prepaid or called at a price less than its
purchase price before its stated maturity.

ALLOCATIONS AND COLLECTIONS

         All collections on the mortgage loans will generally be allocated in
accordance with the credit line agreements between interest and principal.
Interest collections for any payment date will be determined on a loan group
basis and will be equal to the amounts collected during the related Collection
Period allocated to interest pursuant to the credit line agreements, including
portions of net liquidation proceeds, less

         o servicing fees for the related Collection Period and

         o amounts payable to the master servicer pursuant to the sale and
servicing agreement as reimbursement of optional advances of the interest
component of any delinquent monthly payments on the mortgage loans.

Principal collections will be determined for any payment date on a loan group
basis and will be equal to the sum of

         o the amounts collected during the related Collection Period allocated
to principal pursuant to the credit line agreements, including portions of net
liquidation proceeds, and

         o any Transfer Deposit Amounts.

         Net liquidation proceeds of a mortgage loan are the liquidation
proceeds reduced by related expenses, but not in excess of the principal balance
of the mortgage loan plus accrued and unpaid interest thereon to the end of the
Collection Period during which the mortgage loan became a Liquidated Mortgage
Loan. Liquidation proceeds are the proceeds (excluding any amounts drawn on the
Policy) received in connection with the liquidation of any mortgage loan,
whether through trustee's sale, foreclosure sale or otherwise.

         The portion of interest collections allocable to the related class of
Notes ("Investor Interest Collections") for any payment date and loan group will
equal the product of (a) interest collections for the payment date and loan
group and (b) the Investor Floating Allocation

                                      S-68


Percentage for the loan group. The "Investor Floating Allocation Percentage" for
any payment date and loan group is a fraction whose numerator is the Invested
Amount at the close of business on the preceding payment date (or the Closing
Date in the case of the first payment date) and whose denominator is the loan
group balance for the loan group at the beginning of the related Collection
Period. The remaining amount of interest collections will be allocated to the
portion of the transferor interest related to that loan group.

         Principal collections on the mortgage loans in each loan group will be
allocated between the noteholders and the transferor ("Investor Principal
Collections" and "Transferor Principal Collections," respectively).

         The indenture trustee will apply any amounts drawn under the Policy as
provided in the indenture.

         The loan group balance for any date and loan group is the aggregate of
the principal balances of all mortgage loans in that loan group as of the date.
The principal balance of a mortgage loan (other than a Liquidated Mortgage Loan)
on any day is equal to its cut-off date principal balance, plus (1) any
Additional Balances for the mortgage loan minus (2) all collections credited
against the principal balance of the mortgage loan in accordance with the
related credit line agreement before the day. The principal balance of a
Liquidated Mortgage Loan after final recovery of related liquidation proceeds
shall be zero.

         Certain excess cashflow for each class of Notes will be applied as a
payment of principal of that class of Notes on each payment date to increase or
maintain the portion of the transferor's interest related to that class to or at
the Required Transferor Subordinated Amount for the class for the payment date.
The amount of the excess cashflow of a class of Notes so applied as a payment of
principal on a payment date is an "Accelerated Principal Distribution Amount"
for the related class of Notes. The requirement to maintain the transferor's
interest at the Required Transferor Subordinated Amount, or to increase it to
the Required Transferor Subordinated Amount, is not an obligation of the seller,
the master servicer, the indenture trustee, the Note Insurer or any other
person.

         [The indenture requires excess cashflow not required to maintain or
achieve the Required Transferor Subordinated Amount of the related class of
Notes to be applied to the funding of a reserve fund, which has been required by
the Note Insurer to be established and maintained for the Notes (the "Reserve
Fund"). The amount on deposit in the Reserve Fund will not exceed the excess of
(x) the sum of the Required Transferor Subordinated Amounts for each class of
Notes over (y) the sum of the portion of the transferor's interest related to
each class of Notes. Amounts in the Reserve Fund may only be withdrawn and
applied in accordance with the indenture.]

         [The Note Insurer may permit the Required Transferor Subordinated
Amount for a class of Notes to decrease or "step down" over time, subject to
certain floors and triggers. The dollar amount of any decrease in a Required
Transferor Subordinated Amount is an "Overcollateralization Reduction Amount"
which, with respect to each class of Notes, may result in a release of cash from
the trust fund in an amount up to the Overcollateralization Reduction Amounts
(net of any Reimbursement Amounts due to the Note Insurer), or result in the
removal of cash or mortgage loans from the trust fund on payment dates occurring
after the step-downs

                                      S-69


take effect. The dollar amount of any Overcollateralization Reduction Amount for
a class will first be released from the Reserve Fund, to the extent of the
amount on deposit. If the amount on deposit in the Reserve Fund for a class is
not sufficient to fund the full amount of the Overcollateralization Reduction
Amount for the class, then an amount equal to the remaining portion of the
Overcollateralization Reduction Amount will be released from the monthly
cashflow for the class, thus reducing the portion of the transferor's interest
for the class.]

THE POLICY

         [The Policy will be issued by the Note Insurer by the Closing Date
pursuant to the Insurance and Indemnity Agreement (the "Insurance Agreement") to
be dated as of the Closing Date, among the seller, the depositor, the master
servicer, the indenture trustee and the Note Insurer.

         The Policy will irrevocably and unconditionally guarantee payment on
each payment date to the indenture trustee for the benefit of the noteholders of
each class of Notes the full and complete payment of Insured Amounts with
respect to the related Notes for the payment date. An "Insured Amount" for each
class of Notes as of any payment date is any shortfall in amounts available in
the collection account to pay (a) (i) the Guaranteed Principal Distribution
Amount for the related Notes for the payment date and (ii) the Guaranteed
Distributions for the related Notes for the payment date and (b) any Preference
Amount that occurs before the related determination date. The effect of the
Policy is to guarantee the timely payment of interest on, and the ultimate
payment of the principal amount of, all of the Notes. The Policy does not cover
any Basis Risk Carryforward.

         The "Guaranteed Principal Distribution Amount" for any class of Notes
on the payment date in [ ] is the amount needed to pay the outstanding principal
balance of the Notes, and for any other payment date on which the sum of the
Available Transferor Subordinated Amounts for [both] loan groups and the Reserve
Fund has been reduced to or equals zero, is the amount by which the Note
principal balance of the class of Notes exceeds the related Invested Amount as
of the payment date. All calculations under the Policy are after giving effect
to all other amounts distributable and allocable to principal on the Notes for
the payment date.

         "Guaranteed Distributions" are accrued and unpaid interest for a
payment date due on the related Notes calculated in accordance with the original
terms of the Notes or the indenture after giving effect to amendments or
modifications to which the Note Insurer has given its written consent.

         A "Preference Amount" means any amount previously distributed to a
noteholder that is recoverable and recovered as a voidable preference by a
trustee in bankruptcy pursuant to the United States Bankruptcy Code, as amended
from time to time, in accordance with a final nonappealable order of a court
having competent jurisdiction.

         Payment of claims on the Policy will be made by the Note Insurer
following receipt by the Note Insurer of the appropriate notice for payment (and
any other required documentation) on the later to occur of (i) 12:00 NOON, New
York City time, on the second Business Day

                                      S-70


following Receipt of the notice for payment and (ii) 12:00 NOON, New York City
time, on the relevant payment date.

         Receipt means actual delivery to the Note Insurer and occurs on the day
delivered if delivered before 12:00 NOON, New York City time, on a business day,
or on the next business day if delivered either on a day that is not a business
day or after 12:00 NOON, New York City time. If any notice or note given under
the Policy by the indenture trustee is not in proper form or is not properly
completed, executed or delivered, it is not received, and the Note Insurer shall
promptly so advise the indenture trustee and the indenture trustee may submit an
amended notice.

         Under the Policy, "business day" means any day other than a Saturday or
Sunday or a day on which banking institutions in the states of New York,
California or Illinois or the city in which the corporate trust office of the
indenture trustee or the Note Insurer is located are authorized or obligated by
law or executive order to be closed.

         The Note Insurer's obligations under the Policy with respect to Insured
Amounts will be discharged to the extent funds are transferred to the indenture
trustee as provided in the Policy, whether or not the funds are properly applied
by the indenture trustee. The Note Insurer will be subrogated to the rights of
each noteholder to receive payments of principal and interest, as applicable, on
the Notes to the extent of any payment by the Note Insurer under the Policy. The
Policy cannot be modified, altered or affected by any other agreement or
instrument, or by the merger, consolidation or dissolution of the seller. The
Policy by its terms may not be cancelled or revoked. The Policy is governed by
the laws of the State of New York.

         Insured Amounts will be paid only at the time stated in the Policy and
no accelerated Insured Amounts shall be paid regardless of any acceleration of
the Notes, unless the acceleration is at the sole option of the Note Insurer.
The Policy does not cover shortfalls attributable to the liability of the trust
fund or the indenture trustee for withholding taxes, if any (including interest
and penalties in respect of any such liability).

         Pursuant to the sale and servicing agreement, unless a Note Insurer
default exists, the Note Insurer will be treated as a noteholder for certain
purposes, will be entitled to exercise all rights of the noteholders under the
indenture without the consent of the noteholders, and the noteholders may
exercise their rights under the indenture only with the written consent of the
Note Insurer. In addition, the Note Insurer will have certain additional rights
as a third party beneficiary to the sale and servicing agreement and the
indenture.]

RAPID AMORTIZATION EVENTS

         The Managed Amortization Period will continue through and including the
payment date in [ ], unless a Rapid Amortization Event occurs before then. A
"Rapid Amortization Event" refers to any of the following events:

(a) the failure of the seller

         o to make a payment or deposit required under the sale and servicing
agreement within three business days after the date the payment or deposit must
be made,

                                      S-71


         o to record assignments of mortgage loans when required pursuant to the
sale and servicing agreement or

         o to observe or perform in any material respect any other covenants or
agreements of the seller in the sale and servicing agreement, which failure
materially and adversely affects the interests of the noteholders, the Note
Insurer [or any other third party credit enhancer] and, with certain exceptions,
continues unremedied for a period of 60 days after written notice;

(b) any representation or warranty made by the seller or the depositor in the
sale and servicing agreement proves to have been incorrect in any material
respect when made and continues to be incorrect in any material respect for a
period of 60 days after written notice and as a result of which the interests of
the noteholders, the Note Insurer [or any other third party credit enhancer] are
materially and adversely affected; except that a Rapid Amortization Event will
not occur if the seller has purchased or made a substitution for the related
mortgage loan or mortgage loans if applicable during the period (or within an
additional 60 days with the consent of the indenture trustee) in accordance with
the provisions of the sale and servicing agreement;

(c) the occurrence of certain events of bankruptcy, insolvency or receivership
relating to the transferor;

(d) the trust fund becomes subject to regulation by the Securities and Exchange
Commission as an investment company within the meaning of the Investment Company
Act of 1940, as amended; or

(e) the aggregate of all draws under the Policy [or amounts paid pursuant to
third party credit enhancement for loan group [ ]] incurred during the Managed
Amortization Period exceeds [ ]% of the Original Invested Amount.

         If any event described in clause (a) or (b) occurs, a Rapid
Amortization Event will occur only if, after the applicable grace period, either
the indenture trustee or noteholders holding Notes evidencing more than 51% of
the aggregate principal amount of the Notes, the Note Insurer (so long as there
is no default by the Note Insurer in the performance of its obligations under
the Policy) [or any other third party credit enhancer], by written notice to the
transferor, the depositor and the master servicer (and to the indenture trustee,
if given by the Note Insurer, [any other third party credit enhancer] or the
noteholders) declare that a Rapid Amortization Event has occurred. If any event
described in clause (c), (d) or (e) occurs, a Rapid Amortization Event will
occur without any notice or other action on the part of the indenture trustee,
the Note Insurer or the noteholders immediately on the occurrence of the event.

         Notwithstanding the foregoing, if a conservator, receiver or
trustee-in-bankruptcy is appointed for the transferor and no Rapid Amortization
Event exists other than the conservatorship, receivership or insolvency of the
transferor, the conservator, receiver or trustee-in-bankruptcy may have the
power to prevent the commencement of the Rapid Amortization Period.

                                      S-72


REPORTS TO NOTEHOLDERS

         Concurrently with each distribution to the noteholders, the master
servicer will forward to the indenture trustee for mailing to each noteholder a
statement setting forth among other items:

         (i)      the Investor Floating Allocation Percentage for each loan
                  group for the preceding Collection Period;

         (ii)     the amount being distributed to each class of Notes;

         (iii)    the amount of interest included in the distribution and the
                  related note rate for each class of Notes;

         (iv)     the amount of overdue accrued interest for a class of Notes
                  included in the distribution (and the amount of interest or
                  overdue interest to the extent permitted by applicable law);

         (v)      the amount of the remaining overdue accrued interest for a
                  class of Notes after giving effect to the distribution;

         (vi)     the amount of principal included in the distribution;

         (vii)    the amount of the reimbursement of previous Investor Loss
                  Amounts for a class of notes included in the distribution;

         (viii)   the amount of Basis Risk Carryforward for a class of notes
                  paid and the amount of Basis Risk Carryforward accrued;

         (ix)     the amount of the aggregate unreimbursed Investor Loss Amounts
                  for a class of notes after giving effect to the distribution;

         (x)      the servicing fee for the payment date;

         (xi)     for each class of notes: the Invested Amount, the Note
                  principal balance and the pool factor, each after giving
                  effect to the distribution;

         (xii)    the loan group balance of each loan group as of the end of the
                  preceding Collection Period;

         (xiii)   the number and aggregate principal balances of the mortgage
                  loans in each loan group as to which the minimum monthly
                  payment is delinquent for 30-59 days, 60-89 days and 90 or
                  more days, respectively, as of the end of the preceding
                  Collection Period;

         (xiv)    the book value of any real estate in each loan group that is
                  acquired by the trust fund through foreclosure or grant of
                  deed in lieu of foreclosure;

         (xv)     the amount of any draws on the Policy [or payments under third
                  party credit enhancement for loan group [ ]];

         (xvi)    [the amount on deposit in the Reserve Fund on the preceding
                  payment date, after giving effect to all distributions made on
                  that date, the amount withdrawn from the Reserve Fund with
                  respect to this payment date, and the amount remaining on
                  deposit in the Reserve Fund;] and

                                      S-73


         (xvii)   with respect to the first and second payment dates, the number
                  and aggregate balance of any mortgage loans in [either] loan
                  group not delivered to the indenture trustee within 30 days
                  after the Closing Date.

         The amounts in clauses (iii), (iv), (v), (vi), (vii) and (viii) above
shall be expressed as a dollar amount per $1,000 increment of Notes.

         Within 60 days after the end of each calendar year commencing in
200[ ], the master servicer will be required to forward to the indenture trustee
a statement containing the information in clauses (iii) and (vi) above
aggregated for the calendar year.

EVENTS OF DEFAULT UNDER THE INDENTURE

         Events of Default under the indenture include:

         o a default in the payment of any interest when it becomes due and
continuance of the default for five days;

         o a default in the payment of any principal when it becomes due;

         o failure by the trust to perform in any material respect any covenant
or agreement under the indenture (other than a covenant covered under the first
bullet point of this paragraph) or the breach of a representation or warranty of
the trust under the indenture or the sale and servicing agreement, that
continues for thirty days after notice of it is given; and

         o certain events of bankruptcy, insolvency, receivership, or
liquidation of the trust.

REMEDIES ON EVENT OF DEFAULT UNDER THE INDENTURE

         If an event of default under the indenture has occurred and is
continuing, either the indenture trustee or noteholders representing a majority
of the then outstanding principal amount of the Notes may declare the principal
amount of the Notes payable immediately. A declaration of acceleration may be
rescinded by noteholders representing a majority of the then outstanding
principal amount of the Notes. [Although a declaration of acceleration has
occurred, the indenture trustee may elect not to liquidate the assets of the
trust if the assets are generating sufficient cash to pay interest and principal
as it becomes due without taking into account the declaration of acceleration.]

         The indenture trustee may not sell or otherwise liquidate the assets of
the trust following an event of default unless

         o   the holders of 100% of the Notes and the Note Insurer consent to
             the sale, or

         o   the proceeds of the sale or liquidation are sufficient to pay all
             amounts due to the noteholders and the Note Insurer, or

         o   the indenture trustee determines that the trust fund would not be
             sufficient on an ongoing basis to make all payments on the Notes as
             they become due and the indenture trustee obtains the consent of
             the holders of 66 K% of the aggregate outstanding principal
             balance of the Notes.

                                      S-74


         No noteholder may institute any proceeding with respect to the
indenture unless the Note Insurer has consented in writing to the institution of
the proceeding and the holder has previously notified the indenture trustee of a
default and unless noteholders representing not less than [25]% of the aggregate
outstanding principal balance of the Notes have requested the indenture trustee
to institute the proceeding and have offered the indenture trustee reasonable
indemnity, the indenture trustee for 60 days has neglected or refused to
institute the proceeding and the indenture trustee has not received an
inconsistent written request from noteholders representing a majority of the
aggregate outstanding principal balance of the Notes during the 60-day period.
The indenture trustee is not obligated to exercise any of the trusts or powers
vested in it unless the noteholders requesting the action have offered the
indenture trustee reasonable security or indemnity against the costs, expenses
and liabilities that may be incurred and the Note Insurer has consented to the
action.

CERTAIN MATTERS REGARDING THE INDENTURE TRUSTEE AND THE DEPOSITOR

         Neither the depositor, the indenture trustee nor any director, officer
or employee of the depositor of the indenture trustee will be liable to the
trust or the noteholders for taking any action or for refraining from the taking
of any action in good faith pursuant to the indenture, or for errors in
judgment. However, none of the depositor, the indenture trustee or any of their
directors, officers or employees will be protected against any liability that
would otherwise be imposed on them for willful malfeasance, bad faith or gross
negligence in the performance of their duties or for their reckless disregard of
their obligations under the indenture.

         The indenture trustee and any of its affiliates may hold Notes in their
own names or as pledgees. To meet the legal requirements of certain
jurisdictions, the indenture trustee may appoint co-trustees or separate
trustees of any part of the trust fund under the indenture. All rights and
obligations conferred or imposed on the indenture trustee by the indenture will
be conferred or imposed on any separate trustee or co-trustee. In any
jurisdiction in which the indenture trustee is incompetent or unqualified to
perform certain acts, the separate trustee or co-trustee will perform the acts
solely at the direction of the indenture trustee.

DUTIES OF THE INDENTURE TRUSTEE

         The indenture trustee will make no representations about the validity
or sufficiency of the indenture, the Notes (other than their execution and
authentication) or of any mortgage loans or related documents, and will not be
accountable for the use or application by the depositor or the master servicer
of any funds paid to the depositor or the master servicer on the Notes or the
mortgage loans, or the use or investment of any monies by the master servicer
before being deposited into a collection account. So long as no event of default
under the indenture has occurred and is continuing, the indenture trustee will
be required to perform only those duties specifically required of it under the
indenture. Generally, those duties will be limited to the receipt of the various
certificates, reports or other instruments required to be furnished to the
indenture trustee under the indenture, in which case it will only be required to
examine them to determine whether they conform to the requirements of the
indenture. The indenture trustee will not be charged with knowledge of a failure
by the master servicer to perform its duties under the trust agreement or sale
and servicing agreement unless the indenture trustee has actual knowledge of the
failure.

                                      S-75


AMENDMENT

         The indenture provides that, without the consent of any noteholder but
with the consent of the Note Insurer and notice to the trust and the indenture
trustee, the trust may enter into one or more supplemental indentures (which
will conform to the provisions of the Trust Indenture Act of 1939, as amended
(the "TIA")), in form satisfactory to the indenture trustee, for any of the
following purposes:

         o   to correct or amplify the description of any property at any time
             subject to the lien of the indenture, or better to assure, convey
             and confirm to the indenture trustee any property subject or
             required to be subjected to the lien of the indenture, or to
             subject to the lien of the indenture additional property;

         o   to add to the covenants of the trust for the benefit of the
             noteholders, or to surrender any right of the trust in the
             indenture;

         o   to convey, transfer, assign, mortgage or pledge any property to the
             indenture trustee;

         o   to cure any ambiguity or mistake, to correct or supplement any
             provision in the indenture or in any supplemental indenture that
             may be inconsistent with any other provision in the indenture or in
             any supplemental indenture or other transaction documents;

         o   to conform the indenture to this prospectus supplement;

         o   to make any other provisions with respect to matters arising under
             the indenture or in any supplemental indenture if the action will
             not materially and adversely affect the interests of the
             noteholders or the Note Insurer;

         o   to modify, eliminate or add to the provisions of the indenture, (i)
             as required by any Rating Agency to maintain or improve any rating
             of the notes or (ii) to comply with any requirement imposed by the
             Code;

         o   to evidence and provide for the acceptance of the appointment under
             the indenture of a successor trustee under the indenture and to add
             to or change any of the provisions of the indenture necessary to
             facilitate the administration of its trusts by more than one
             trustee; or

         o   to modify, eliminate or add to the provisions of the indenture to
             the extent necessary to effect the qualification of the indenture
             under the TIA or under any similar federal statute enacted after
             the date of the indenture and to add to the indenture other
             provisions required by the TIA.

No supplemental indentures will be entered into unless the indenture trustee
shall have received an opinion of counsel to the effect that entering into the
supplemental indenture will not have any material adverse tax consequences to
the noteholders.

         The indenture also provides that the indenture trustee, at the request
of the trust, may, with prior notice to the Note Insurer and with the consent of
the Note Insurer and the Noteholders affected thereby representing not less than
a majority of the aggregate outstanding principal balance of the Notes, enter
into a supplemental indenture to add any provisions to, or

                                      S-76


change in any manner or eliminate any of the provisions of, the indenture or to
modify in any manner the rights of the noteholders, except that no supplemental
indenture may, without the consent of each noteholder affected thereby:

         o   change the date of payment of any installment of principal of or
             interest on any Note, or reduce its principal amount or interest
             rate, change the provisions of the indenture relating to the
             application of collections on, or the proceeds of the sale of, the
             corpus of the trust to payment of principal or interest on the
             Notes, or change any place of payment where, or the coin or
             currency in which, any Note or its interest is payable, or impair
             the right to institute suit for the enforcement of the provisions
             of the indenture requiring the application of funds available
             therefor to the payment of any such amount due on the Notes on or
             after the respective dates they become due;

         o   reduce the percentage of the outstanding principal balances of the
             Notes the consent of the holders of which is required for any
             supplemental indenture, or the consent of the holders of which is
             required for any waiver of compliance with provisions of the
             indenture or defaults under the indenture and their consequences;

         o   modify or alter the provisions of the proviso to the definition of
             the term "Outstanding" in the indenture or modify or alter the
             exception in the definition of the term "Holder";

         o   reduce the percentage of the outstanding principal balances of the
             Notes required to direct the indenture trustee to direct the trust
             to sell or liquidate the corpus of the trust pursuant to the
             indenture;

         o   modify any provision of the amendment provisions of the indenture
             except to increase any percentage specified in the indenture or to
             provide that certain additional provisions of the indenture cannot
             be modified or waived without the consent of each Noteholder
             affected thereby;

         o   modify any of the provisions of the indenture in such manner as to
             affect the calculation of the amount of any payment of interest or
             principal due on any Note on any payment date; or

         o   permit the creation of any lien ranking before or on a parity with
             the lien of the indenture on any part of the trust fund or, except
             as otherwise permitted or contemplated in the indenture, terminate
             the lien of the indenture on any property at any time subject
             thereto or deprive any noteholders of the security provided by the
             lien of the indenture.

TERMINATION; RETIREMENT OF THE NOTES

         The indenture will terminate on the payment date following the later of

         (A)   payment in full of all amounts owing to the Note Insurer [and any
               other third party credit enhancer] and

         (B)   the earliest of

               o  the payment date on which the Note principal balance of each
                  class of Notes has been reduced to zero,

                                      S-77


               o  the final payment or other liquidation of the last mortgage
                  loan in the trust fund,

               o  the optional transfer to the transferor of the mortgage loans,
                  as described below; and

               o  the payment date in [ ].

         The mortgage loans will be subject to optional transfer to the
transferor on any payment date on or after which the aggregate principal balance
of the mortgage loans is reduced to an amount less than or equal to [ ]% of the
sum of the aggregate original principal balance of the initial mortgage loans as
of the initial cut-off date and the aggregate original principal balance of any
Additional Home Equity Loans as of their respective cut-off dates and all
amounts due to the Note Insurer [and any other third party credit enhancer]
including any unreimbursed draws on the Policy [and unreimbursed payments under
other third party credit enhancement], together with interest thereon, as
provided under the Insurance Agreement, have been paid. The transfer price will
be equal to the sum of

         o the outstanding Note principal balance of each class of Notes plus
accrued and unpaid interest on them at the applicable note rate through the day
preceding the final payment date and

         o an amount equal to any Basis Risk Carryforward for each class of
Notes plus accrued and unpaid interest on it.

         [In addition, Notes must be prepaid and redeemed in part with any funds
remaining in the relevant additional loan account on [ ] after the purchase of
any Additional Home Equity Loans on that day.]

THE INDENTURE TRUSTEE

         [Name of indenture trustee], a [ ] banking association with its
principal place of business in [ ], is the indenture trustee.

         The commercial bank or trust company serving as indenture trustee may
own Notes and have normal banking relationships with the master servicer, the
transferor and the Note Insurer and their affiliates.

         The indenture trustee may resign at any time, in which event the trust
must appoint a successor indenture trustee with the consent of the Note Insurer.
The Note Insurer may also remove the indenture trustee if the indenture trustee
ceases to be eligible to continue as such under the indenture or if the
indenture trustee becomes insolvent. Any resignation or removal of the indenture
trustee and appointment of a successor indenture trustee will not become
effective until acceptance of the appointment by the successor indenture
trustee.

                 DESCRIPTION OF THE SALE AND SERVICING AGREEMENT

ASSIGNMENT OF MORTGAGE LOANS

         At the time of issuance of the Notes, the depositor will transfer to
the trust fund [the amounts to be deposited into the additional loan accounts
and] all of its interest in each mortgage

                                      S-78


loan acquired on the closing date (including any Additional Balances arising in
the future), related credit line agreements, mortgages and certain other related
documents (collectively, the "Related Documents"), including all collections
received on each mortgage loan after the cut-off date (exclusive of payments of
accrued interest due on or before the cut-off date). The owner trustee,
concurrently with the transfer, will deliver the Notes to the depositor and the
transferor certificate to the transferor. [Subsequent closings may occur for the
purchase of Additional Home Equity Loans on dates specified by the depositor
through [ ], 200[ ]. On those closing dates the depositor will transfer to the
trust fund all of its interest in the Additional Home Equity Loans being
acquired by the trust fund that day, the Related Documents and all collections
received on the Additional Home Equity Loans after a date designated in
connection with the transfer.] Each mortgage loan transferred to the trust fund
will be identified on a mortgage loan schedule delivered to the owner trustee
pursuant to the sale and servicing agreement. The mortgage loan schedule will
include information as to the cut-off date principal balance of each mortgage
loan as well as information with respect to the loan rate.

         The sale and servicing agreement will require that [IndyMac Bank]
deliver to the depositor for delivery to the owner trustee or, at the
depositor's direction, directly to the owner trustee, the mortgage notes related
to the mortgage loans endorsed in blank and the Related Documents

          o on the Closing Date, with respect to not less than [50]% of the
mortgage loans transferred to the trust fund on that date;

          o not later than [30] days after the Closing Date, with respect to the
[remaining] mortgage loans; [and]

          o [not later than [21] days after the relevant transfer date, with
respect to the Additional Home Equity Loans.]

         In lieu of delivery of original documentation, [IndyMac Bank] may
deliver documents that have been imaged optically on delivery of an opinion of
counsel that the imaged documents are enforceable to the same extent as the
originals and do not impair the enforceability of the transfer to the trust fund
of the mortgage loans, provided the retention of the imaged documents in the
delivered format will not result in a reduction in the then current rating of
the Notes without regard to the Policy [or any other third party credit
enhancements].

         [In addition, with respect to any of the mortgage loans, in lieu of
transferring the related mortgage to the indenture trustee as one of the Related
Documents, the depositor may at its discretion provide evidence that the related
mortgage is held through the MERS(R) System. In addition, the mortgage for some
or all of the mortgage loans in the trust fund that are not already held in the
MERS(R) System may, at the discretion of the master servicer, in the future be
held through the MERS(R) System. For any mortgage held through the MERS(R)
System, the mortgage is recorded in the name of the Mortgage Electronic
Registration System, Inc. or MERS, as nominee for the owner of the mortgage
loan, and subsequent assignments of the mortgage were, or in the future may be,
at the discretion of the master servicer, registered electronically through the
MERS(R) System. For each of these mortgage loans, MERS serves as a mortgagee of
record on the mortgage solely as a nominee in an administrative capacity on
behalf of the owner trustee, and does not have any interest in that mortgage
loan.]

                                      S-79


         Within 90 days of the Closing Date with respect to the mortgage loans
acquired on the Closing Date [and within 90 days of the relevant closing date
with respect to Additional Home Equity Loans], the indenture trustee will review
the mortgage loans and the Related Documents and if any mortgage loan or Related
Document is found to be defective in any material respect and the defect is not
cured within 90 days following notification of it to the seller and the
depositor by the indenture trustee, the seller must accept the transfer of the
mortgage loan from the trust fund. The principal balance of any mortgage loan so
transferred will be deducted from the applicable loan group balance, thus
reducing the amount of the transferor interest. If the deduction would cause the
portion of the transferor interest related to the loan group to become less than
the related Minimum Transferor Interest at the time (a "Transfer Deficiency"),
the seller must either substitute an Eligible Substitute Mortgage Loan or make a
deposit into the collection account (the "Transfer Deposit Amount") equal to the
amount by which the portion of the transferor interest related to that loan
group would be reduced to less than the related Minimum Transferor Interest at
the time. Except to the extent substituted for by an Eligible Substitute
Mortgage Loan, the transfer of the mortgage loan out of the trust fund will be
treated under the sale and servicing agreement as a payment in full of the
mortgage loan. Any Transfer Deposit Amount will be treated as a principal
collection on the related loan group. No transfer shall be considered to have
occurred unless all required deposits to the collection account are actually
made. The obligation of the seller to accept a transfer of a Defective Mortgage
Loan and to make any required deposits are the sole remedies for any defects in
the mortgage loans and Related Documents available to the owner trustee, the
indenture trustee or the noteholders.

         An "Eligible Substitute Mortgage Loan" is a mortgage loan substituted
by the seller for a defective mortgage loan that must, on the date of
substitution,

          o have a principal balance (or in the case of a substitution of more
than one mortgage loan for a Defective Mortgage Loan, an aggregate principal
balance) outstanding that is not [10]% more or less than the Transfer Deficiency
relating to the Defective Mortgage Loan;

          o have a loan rate not less than the loan rate of the Defective
Mortgage Loan and not more than 1% in excess of the loan rate of the Defective
Mortgage Loan;

          o have a loan rate based on the same index (prime rate) with
adjustments to the loan rate made on the same Interest Rate Adjustment Date as
that of the Defective Mortgage Loan;

          o have a FICO Score not less than the FICO Score of the Defective
Mortgage Loan and not more than [ ] points higher than the FICO Score for the
Defective Mortgage Loan;

          o have a margin that is not less than the margin of the Defective
Mortgage Loan and not more than [ ] basis points higher than the margin for the
Defective Mortgage Loan;

          o have a mortgage of the same or higher level of priority as the
mortgage relating to the Defective Mortgage Loan;

          o have a remaining term to maturity not more than [six] months earlier
and not more than [60] months later than the remaining term to maturity of the
Defective Mortgage Loan;

          o comply with each representation and warranty regarding the mortgage
loans in the sale and servicing agreement (deemed to be made as of the date of
substitution);

                                      S-80


          o have an original combined loan-to-value ratio not greater than that
of the Defective Mortgage Loan; and

          o satisfy certain other conditions specified in the sale and servicing
agreement.

         The seller will make certain representations and warranties as to the
accuracy in all material respects of certain information furnished to the owner
trustee on behalf of the trust fund with respect to each mortgage loan (e.g.,
cut-off date principal balance and loan rate). In addition, the seller will
represent and warrant on the Closing Date that at the time of transfer to the
depositor, the seller has transferred or assigned all of its interest in each
mortgage loan and the Related Documents, free of any lien[, and likewise
represent and warrant on each relevant closing date with respect to each
Additional Home Equity Loan]. Upon discovery of a breach of any representation
and warranty that materially and adversely affects the interests of the
noteholders, the Note Insurer [or any other third party credit enhancer] in the
related mortgage loan and Related Documents, the seller will have a period of 90
days after discovery or notice of the breach to effect a cure. If the breach
cannot be cured within the 90-day period, the seller must accept a transfer of
the Defective Mortgage Loan from the trust fund. The same procedure and
limitations as in the second preceding paragraph for the transfer of Defective
Mortgage Loans will apply to the transfer of a mortgage loan that must be
transferred because of a breach of a representation or warranty in the sale and
servicing agreement that materially and adversely affects the interests of the
noteholders.

         Mortgage loans required to be transferred to the seller as described in
the preceding paragraphs are referred to as "Defective Mortgage Loans."

AMENDMENTS TO CREDIT LINE AGREEMENTS

         Subject to applicable law and to certain limitations described in the
sale and servicing agreement, the master servicer may change the terms of the
credit line agreements at any time provided that the changes

          o do not materially and adversely affect the interest of the
noteholders, the Note Insurer [or any other third party credit enhancer], and

          o are consistent with prudent business practice.

In addition, the sale and servicing agreement permits the master servicer,
within certain limits, to increase the credit limit of the related mortgage loan
or reduce the margin for the mortgage loan.

OPTIONAL TRANSFERS OF MORTGAGE LOANS TO THE TRANSFEROR

         To permit the transferor to reduce the transferor interest any time the
portion of the transferor interest related to a loan group exceeds the level
required by the Note Insurer[, any other third party credit enhancer] and the
Rating Agencies, on any payment date the transferor may, but is not obligated
to, remove on the payment date (the "Transfer Date") from the loan group,
certain mortgage loans without notice to the noteholders. The transferor is
permitted to designate the mortgage loans to be removed. Mortgage loans so
designated will only be removed upon satisfaction of the following conditions:

                                      S-81


          o no Rapid Amortization Event has occurred;

          o the portion of the transferor interest allocable to the loan group
as of the Transfer Date (after giving effect to the removal) exceeds the Minimum
Transferor Interest;

          o the transfer of any mortgage loans from [either] loan group on any
Transfer Date during the Managed Amortization Period will not, in the reasonable
belief of the transferor, cause a Rapid Amortization Event or an event that with
notice or lapse of time or both would constitute a Rapid Amortization Event to
occur;

          o the transferor delivers to the owner trustee and the indenture
trustee a mortgage loan schedule containing a list of all mortgage loans
remaining in the related loan group after the removal;

          o the transferor represents and warrants that no selection procedures
that the transferor reasonably believes are adverse to the interests of the
noteholders, the Note Insurer [or any other third party credit enhancer] were
used by the transferor in selecting the mortgage loans;

          o in connection with each retransfer of mortgage loans, the Rating
Agencies and the Note Insurer shall have been notified of the proposed transfer
and before the Transfer Date no Rating Agency has notified the transferor or the
Note Insurer in writing that the transfer would result in a reduction or
withdrawal of the ratings assigned to either class of Notes without regard to
the Policy [or any other third party credit enhancement]; and

          o the transferor shall have delivered to the owner trustee, the
indenture trustee and the Note Insurer an officer's note confirming the six
conditions preceding this one.

As of any date of determination within any Collection Period, the "Minimum
Transferor Interest" for either loan group is an amount equal to [the lesser of
(a) 5% of the related loan group balance at the end of the immediately preceding
Collection Period and (b) 1.5% of the cut-off date balance of the related loan
group].

COLLECTION AND OTHER SERVICING PROCEDURES ON MORTGAGE LOANS

         The master servicer will make reasonable efforts to collect all
payments called for under the mortgage loans and will, consistent with the sale
and servicing agreement, follow collection procedures it follows servicing home
equity loans in its servicing portfolio comparable to the mortgage loans.
Consistent with the above, the master servicer may in its discretion waive any
late payment charge or any assumption or other fee or charge that may be
collected in the ordinary course of servicing the mortgage loans.

         The master servicer may arrange with a borrower of a mortgage loan a
schedule for the payment of interest due and unpaid for a period so long as the
arrangement is consistent with the master servicer's policies with respect to
mortgage loans it owns or services. In accordance with the sale and servicing
agreement, the master servicer may consent under certain circumstances to the
placing of a subsequent senior lien ahead of a mortgage loan.

                                      S-82


HAZARD INSURANCE

         The sale and servicing agreement provides that the master servicer
maintain hazard insurance on the mortgaged properties relating to the mortgage
loans. While the related credit line agreements generally require borrowers to
maintain hazard insurance, the master servicer will not monitor the maintenance
of hazard insurance.

         The sale and servicing agreement requires the master servicer to
maintain for any mortgaged property relating to a mortgage loan acquired in
foreclosure of a mortgage loan, or by deed in lieu of foreclosure, hazard
insurance with extended coverage in an amount equal to the lesser of

          o the maximum insurable value of the mortgaged property or

          o the outstanding balance of the mortgage loan plus the outstanding
balance on any mortgage loan senior to the mortgage loan at the time of
foreclosure or deed in lieu of foreclosure, plus accrued interest and the master
servicer's good faith estimate of the related liquidation expenses to be
incurred in connection therewith.

The sale and servicing agreement provides that the master servicer may satisfy
its obligation to cause hazard policies to be maintained by maintaining a
blanket policy insuring against losses on the mortgaged properties. If the
blanket policy contains a deductible clause, the master servicer must deposit in
the collection account the sums that would have been deposited but for the
deductible. The master servicer will satisfy these requirements by maintaining a
blanket policy. As stated above, all amounts collected by the master servicer
(net of any reimbursements to the master servicer) under any hazard policy
(except for amounts to be applied to the restoration or repair of the mortgaged
property) will ultimately be deposited in the collection account.

         In general, the standard form of fire and extended coverage policy
covers physical damage to or destruction of the improvements on the property by
fire, lightning, explosion, smoke, windstorm and hail, and the like, strike and
civil commotion, subject to the conditions and exclusions specified in each
policy. Although the policies relating to the mortgage loans will be
underwritten by different insurers and therefore will not contain identical
terms, their basic terms are dictated by state laws and most of them typically
do 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 reactions, 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 or an exact description of the
insurance policies relating to the mortgaged properties.

REALIZATION ON DEFAULTED MORTGAGE LOANS

         The master servicer will foreclose on or otherwise comparably convert
to ownership mortgaged properties securing mortgage loans that come into default
when, in accordance with applicable servicing procedures under the sale and
servicing agreement, no satisfactory arrangements can be made for the collection
of delinquent payments. In connection with a foreclosure or other conversion,
the master servicer will follow practices it deems appropriate

                                      S-83


and in keeping with its general mortgage servicing activities. The master
servicer need not expend its own funds in connection with any foreclosure or
other conversion, correction of default on a related senior mortgage loan, or
restoration of any property unless, in its sole judgment, the expenditure of
funds in the foreclosure, correction or restoration will increase net
liquidation proceeds. The master servicer will be reimbursed out of liquidation
proceeds and, if necessary, from other collections on the mortgage loans for
advances of its own funds as liquidation expenses before any net liquidation
proceeds are distributed to noteholders or the transferor.

OPTIONAL PURCHASE OF DEFAULTED LOAN

         The master servicer may, at its option, purchase from the trust fund
any mortgage loan that is delinquent in payment for 91 days or more. Any
purchase of a delinquent mortgage loan will be at a price equal to 100% of the
principal balance of the mortgage loan plus accrued interest at the applicable
loan rate from the date through which interest was last paid by the related
mortgagor to the first day of the month in which the purchase proceeds are to be
distributed to noteholders.

SERVICING COMPENSATION AND PAYMENT OF EXPENSES

         The master servicer will receive from interest received on the mortgage
loans for each Collection Period a portion of the interest collections as a
monthly servicing fee in the amount equal to [ ]% per annum on the aggregate
principal balances of the mortgage loans as of the first day of the related
Collection Period. All assumption fees, late payment charges and other fees and
charges, to the extent collected from borrowers, will be retained by the master
servicer as additional servicing compensation.

         The master servicer will pay certain ongoing expenses associated with
the trust fund and incurred by it in connection with its responsibilities under
the sale and servicing agreement. In addition, the master servicer will be
entitled to reimbursement for certain expenses incurred by it in connection with
defaulted mortgage loans and in connection with the restoration of mortgaged
properties, its right of reimbursement being before the rights of noteholders to
receive any related net liquidation proceeds and, if necessary, other
collections on the mortgage loans.

EVIDENCE AS TO COMPLIANCE

         The sale and servicing agreement provides for delivery by [March 31] in
each year, beginning [March 31, [200[ ]], to the indenture trustee of an annual
statement signed by an officer of the master servicer to the effect that the
master servicer has fulfilled its material obligations under the sale and
servicing agreement throughout the preceding fiscal year, except as specified in
the statement.

         By [March 31] of each year, beginning [March 31, [200[ ]], the master
servicer will furnish a report prepared by a firm of nationally recognized
independent public accountants (who may also render other services to the master
servicer or the transferor) to the indenture trustee, the Note Insurer[, any
other third party credit enhancer] and the Rating Agencies to the effect that it
has examined certain documents and the records relating to servicing of the
mortgage loans under the sale and servicing agreement and that, on the basis of
its examination, the firm

                                      S-84


believes that such servicing was conducted in compliance with the sale and
servicing agreement except for exceptions the firm believes to be immaterial and
any other exceptions specified in the report.

CERTAIN MATTERS REGARDING THE MASTER SERVICER AND THE TRANSFEROR

         The sale and servicing agreement provides that the master servicer may
not resign as master servicer, except in connection with a permitted transfer of
servicing, unless

         (a)  its obligations as master servicer are no longer permissible under
              applicable law or are in material conflict by reason of applicable
              law with any other activities of a type and nature presently
              carried on by it or its affiliate or

         (b)  on satisfaction of the following conditions:

                    o    the master servicer has proposed a successor servicer
                         to the indenture trustee in writing and the proposed
                         successor servicer is reasonably acceptable to the
                         indenture trustee;

                    o    the Rating Agencies have confirmed to the trustee that
                         the appointment of the proposed successor servicer as
                         the master servicer will not result in the reduction or
                         withdrawal of the then current rating of the Notes
                         without regard to the Policy [or any other third party
                         credit enhancement]; and

                    o    the proposed successor servicer is reasonably
                         acceptable to the Note Insurer.

No resignation of the master servicer will become effective until the indenture
trustee or a successor servicer has assumed the master servicer's duties under
the sale and servicing agreement.

         The master servicer may perform any of its obligations under the sale
and servicing agreement through subservicers or delegates, which may be
affiliates of the master servicer. Notwithstanding any subservicing arrangement,
the master servicer will remain liable to the indenture trustee and the
noteholders for the master servicer's obligations under the sale and servicing
agreement, without any diminution of its obligations and as if the master
servicer itself were performing the obligations.

         The sale and servicing agreement provides that the master servicer will
indemnify the trust fund and the owner trustee against any loss, liability,
expense, damage or injury suffered as a result of the master servicer's actions
or omissions in connection with the servicing and administration of the mortgage
loans that are not in accordance with the sale and servicing agreement. Under
the sale and servicing agreement, the transferor will indemnify an injured party
for the entire amount of any losses, claims, damages or liabilities arising out
of the sale and servicing agreement to the extent provided in the sale and
servicing agreement (other than losses resulting from defaults under the
mortgage loans). The sale and servicing agreement provides that other than the
indemnification by the master servicer neither the depositor, the transferor nor
the master servicer nor their directors, officers, employees or agents will be
liable to the trust fund, the owner trustee, the noteholders or any other person
for any action taken or for refraining from taking any action pursuant to the
sale and servicing agreement. However, neither the



                                      S-85


depositor, the transferor nor the master servicer nor its directors, officers,
employees or agents will be protected against any liability that would otherwise
be imposed for willful misconduct, bad faith or gross negligence of the
depositor, the transferor or the master servicer in the performance of its
duties under the sale and servicing agreement or for reckless disregard of its
obligations under the sale and servicing agreement. In addition, the sale and
servicing agreement provides that the master servicer need not appear in,
prosecute or defend any legal action that is not incidental to its servicing
responsibilities under the sale and servicing agreement and that in its opinion
may expose it to any expense or liability. The master servicer may, in its sole
discretion, undertake any legal action that it deems appropriate with respect to
the sale and servicing agreement and the interests of the noteholders.

EVENTS OF SERVICING TERMINATION

         The "Events of Servicing Termination" are:

         (i)   any failure by the master servicer to deposit in the collection
               account any deposit required to be made under the sale and
               servicing agreement, which failure continues unremedied for five
               business days (or, if the master servicer is permitted to remit
               collections on the mortgage loans to the collection account on a
               monthly basis as described under "-- Payments on Mortgage Loans;
               Deposits to Collection Account," three business days) after the
               giving of written notice of the failure to the master servicer by
               the indenture trustee, or to the master servicer and the
               indenture trustee by the Note Insurer [, any other third party
               credit enhancer] or noteholders evidencing an aggregate undivided
               interest in the trust fund of at least 25% of the aggregate Note
               principal balance;

         (ii)  any failure by the master servicer duly to observe or perform in
               any material respect any other of its covenants or agreements in
               the Notes or the sale and servicing agreement that, in each case,
               materially and adversely affects the interests of the
               noteholders[, any other third party credit enhancer] or the Note
               Insurer and continues unremedied for 60 days after the giving of
               written notice of the failure to the master servicer by the
               indenture trustee, or to the master servicer and the indenture
               trustee by the Note Insurer[, any other third party credit
               enhancer] or noteholders evidencing an aggregate, undivided
               interest in the trust fund of at least 25% of the aggregate Note
               principal balance; or

         (iii) certain events of insolvency, readjustment of debt, marshalling
               of assets and liabilities or similar proceedings relating to the
               master servicer and certain actions by the master servicer
               indicating insolvency, reorganization or inability to pay its
               obligations.

         Under certain other circumstances, the Note Insurer or the holders of
Notes evidencing an aggregate, undivided interest in the trust fund of at least
51% of the aggregate Note principal balance may deliver written notice to the
master servicer terminating all the rights and obligations of the master
servicer under the sale and servicing agreement.

         Notwithstanding the foregoing, a delay in or failure of performance
referred to under clause (i) above for a period of five or more business days or
referred to under clause (ii) above

                                      S-86


for a period of 60 or more days, will not constitute an Event of Servicing
Termination if the delay or failure could not be prevented by the exercise of
reasonable diligence by the master servicer and the delay or failure was caused
by an act of God or other similar occurrence. The master servicer shall not be
relieved from using its best efforts to perform its obligations in a timely
manner in accordance with the sale and servicing agreement by an act of God or
other similar occurrence, and the master servicer shall provide the indenture
trustee, the depositor, the transferor, the Note Insurer[, any other third party
credit enhancer] and the noteholders prompt notice of any failure or delay by
it, together with a description of its efforts to perform its obligations.

RIGHTS AFTER AN EVENT OF SERVICING TERMINATION

         So long as an Event of Servicing Termination remains unremedied, either
the indenture trustee, or noteholders evidencing an aggregate undivided interest
in the trust fund of at least 51% of the aggregate Note principal balance (with
the consent of the Note Insurer) or the Note Insurer, may terminate all of the
rights and obligations of the master servicer under the sale and servicing
agreement, whereupon the indenture trustee will succeed to all the obligations
of the master servicer under the sale and servicing agreement and will be
entitled to similar compensation arrangements. If the indenture trustee would be
obligated to succeed the master servicer but is unwilling or unable so to act,
it may appoint, or petition a court of competent jurisdiction for the
appointment of, a housing and home finance institution or other mortgage loan or
home equity loan servicer with all licenses and permits required to perform its
obligations under the sale and servicing agreement and having a net worth of at
least $[ ] and acceptable to the Note Insurer to act as successor to the master
servicer under the sale and servicing agreement. Pending such appointment, the
indenture trustee must act as master servicer unless prohibited by law. The
successor master servicer will be entitled to receive the same compensation that
the master servicer would otherwise have received (or such lesser compensation
as the indenture trustee and the successor may agree on). A receiver or
conservator for the master servicer may be empowered to prevent the termination
and replacement of the master servicer where the Event of Servicing Termination
that has occurred is an insolvency event.

AMENDMENT

         The sale and servicing agreement may be amended from time to time by
the seller, the master servicer, the depositor and the indenture trustee and
with the consent of the Note Insurer, but without the consent of the
noteholders,

          o to cure any ambiguity,

          o to correct any defective provision or to correct or supplement
any provisions in it that may be inconsistent with any other provisions of the
sale and servicing agreement,

          o to add to the duties of the depositor, the seller, the transferor or
the master servicer,

          o to add or amend any provisions of the sale and servicing agreement
as required by the Rating Agencies to maintain or improve any rating of the
Notes (after obtaining the ratings in effect on the Closing Date, neither the
transferor, the seller, the depositor, the owner trustee, the indenture trustee
nor the master servicer must obtain, maintain, or improve any rating),

                                      S-87


          o to conform the sale and servicing agreement to this prospectus
supplement,

          o to add any other provisions with respect to matters arising under
the sale and servicing agreement or the Policy that are not be inconsistent with
the sale and servicing agreement [or any other third party credit enhancement],

          o to comply with any requirement of the Internal Revenue Code or

          o to increase the limits in the sale and servicing agreement as to the
amount of senior liens that the master servicer may consent to, if the amendment
will not, as evidenced by an opinion of counsel, materially and adversely affect
the interests of any noteholder, the Note Insurer [or any other third party
credit enhancer].

         No amendment will be considered to materially and adversely affect the
noteholders and no opinion of counsel will be required to be delivered if the
person requesting the amendment obtains a letter from the Rating Agencies
stating that the amendment would not result in a downgrading of the then current
rating of the Notes without regard to the Policy [or any other third party
credit enhancement].

         The sale and servicing agreement may also be amended from time to time
by the seller, the master servicer, the depositor, and the owner trustee on
behalf of the trust fund, and the master servicer and the Note Insurer may from
time to time consent to the amendment of the Policy, with the consent at least
51% of the Note principal balance of the affected class and the Note Insurer for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of the sale and servicing agreement or of modifying in any
manner the rights of the noteholders, so long as the amendment does not

          o reduce in any manner the amount of, or delay the timing of, payments
on the Notes or distributions or payments under the Policy that are required to
be made on any Note without the consent of each affected noteholder,

          o reduce the aforesaid percentage required to consent to any such
amendment, without the consent of all the noteholders

          o adversely affect in any material respect the interests of the Note
Insurer [or any other third party credit enhancer].

         The mortgage loans will be subject to optional transfer to the
transferor on any payment date on or after which the aggregate Note principal
balance [of both classes of Notes] is reduced to an amount less than or equal to
[10]% of the aggregate Original Note Principal Balance [for both classes of
Notes] and all amounts due and owing to the Note Insurer [and any other third
party credit enhancer] including any unreimbursed draws on the Policy [and
unreimbursed payments under other third party credit enhancement], together with
interest on the draws, as provided under the Insurance Agreement, have been
paid. The transfer price will be equal to the sum of

          o the outstanding Note principal balance of each class of Notes plus
accrued interest at the applicable note rate through the day preceding the final
payment date and

          o an amount equal to any Basis Risk Carryforward for each class of
Notes plus accrued interest.

                                      S-88


DEFAULT MANAGEMENT SERVICES

     IN CONNECTION WITH THE SERVICING OF DEFAULTED MORTGAGE LOANS FOR WHICH THE
MASTER SERVICER DOES NOT SERVICE DIRECTLY, THE MASTER SERVICER MAY PERFORM
CERTAIN DEFAULT MANAGEMENT AND OTHER SIMILAR SERVICES (INCLUDING, BUT NOT
LIMITED TO, APPRAISAL SERVICES) AND MAY ACT AS A BROKER IN THE SALE OF MORTGAGED
PROPERTIES RELATED TO THOSE MORTGAGE LOANS. THE MASTER SERVICER WILL BE ENTITLED
TO REASONABLE COMPENSATION FOR PROVIDING THOSE SERVICES.



                      DESCRIPTION OF THE PURCHASE AGREEMENT

         The mortgage loans to be transferred to the trust fund by the depositor
will be purchased by the depositor from the seller pursuant to a purchase
agreement to be entered into between the depositor, as purchaser of the mortgage
loans, and the seller, as transferor of the mortgage loans. Under the purchase
agreement, the seller will agree to transfer the mortgage loans and related
Additional Balances to the depositor. Pursuant to the sale and servicing
agreement, the mortgage loans will be immediately transferred by the depositor
to the trust fund, and the depositor will assign its rights under the purchase
agreement to the trust fund. The following is a description of the material
provisions of the purchase agreement.

TRANSFERS OF MORTGAGE LOANS

         Pursuant to the purchase agreement, the seller will transfer and assign
to the depositor, all of its interest in the mortgage loans [(including any
Additional Home Equity Loans)] and all of the Additional Balances subsequently
created. The purchase price of the mortgage loans is a specified percentage of
their face amount as of the time of transfer and is payable by the depositor in
cash. The purchase price of each Additional Balance comprising the principal
balance of a mortgage loan is the amount of the Additional Balance.

REPRESENTATIONS AND WARRANTIES

         The seller will represent and warrant to the depositor that, among
other things, as of the Closing Date, it is duly organized and in good standing
and that it has the authority to consummate the transactions contemplated by the
purchase agreement. The seller will also represent and warrant to the depositor
that, among other things, immediately before the sale of the mortgage loans to
the depositor, the seller was the sole owner and holder of the mortgage loans
free and clear of any liens and security interests. The seller will make similar
representations and warranties in the sale and servicing agreement. The seller
will also represent and warrant to the depositor that, among other things, as of
the Closing Date, the purchase agreement constitutes a valid and legally binding
obligation of the seller and a valid sale to the depositor of all interest of
the seller in the mortgage loans and their proceeds.

ASSIGNMENT TO TRUST FUND

         The seller will expressly acknowledge and consent to the depositor's
transfer of its rights relating to the mortgage loans under the sale and
servicing agreement to the trust fund and the

                                      S-89


security interest granted in those rights under the indenture. The seller also
will agree to perform its obligations under the purchase agreement for the
benefit of the trust fund.

TERMINATION

         The purchase agreement will terminate on the termination of the trust
fund.

                                 USE OF PROCEEDS

         The net proceeds to be received from the sale of the [Class [ ]] Notes
will be applied by the depositor towards the purchase of the initial [loan group
[ ]] mortgage loans [and the deposit to the Additional Loan Account].

                    MATERIAL FEDERAL INCOME TAX CONSEQUENCES

GENERAL

         The following discussion, which summarizes the material U.S. federal
income tax aspects of the purchase, ownership and disposition of the Notes, is
based on the provisions of the Internal Revenue Code of 1986, as amended (the
"Code"), the Treasury Regulations thereunder, and published rulings and court
decisions in effect as of the date hereof, all of which are subject to change,
possibly retroactively. This discussion does not address every aspect of the
U.S. federal income tax laws which may be relevant to beneficial owners of
[Class [ ]] Notes in light of their personal investment circumstances or to
certain types of beneficial owners of [Class [ ]] Notes subject to special
treatment under the U.S. federal income tax laws (for example, banks and life
insurance companies). Accordingly, investors should consult their tax advisors
regarding U.S. federal, state, local, foreign and any other tax consequences to
them of investing in the Notes.

CHARACTERIZATION OF THE NOTES AS INDEBTEDNESS

         Based on the application of existing law to the facts established by
the indenture and other relevant documents and assuming compliance with the
indenture as in effect on the date of issuance of the Notes, Sidley Austin Brown
& Wood LLP, special tax counsel to the depositor ("Tax Counsel"), is of the
opinion that the Notes will be treated as debt instruments for federal income
tax purposes as of such date. Accordingly, upon issuance, the Notes will be
treated as "Debt Securities" as described in the prospectus. Furthermore,
special tax counsel to the depositor is of the opinion that neither the trust
fund nor any portion of the trust fund will be treated as either an association
or a publicly traded partnership taxable as a corporation or as a taxable
mortgage pool. See "Federal Income Tax Consequences" in the prospectus.

         THE TRANSFEROR AND THE NOTEHOLDERS EXPRESS IN THE SALE AND SERVICING
AGREEMENT THEIR INTENT THAT, FOR APPLICABLE TAX PURPOSES, THE NOTES WILL BE
INDEBTEDNESS SECURED BY THE MORTGAGE LOANS. The transferor, the depositor and
the noteholders, by accepting the Notes, and each Note Owner by its acquisition
of a beneficial interest in a Note, have agreed to treat the Notes as
indebtedness for U.S. federal income tax purposes. However, because different
criteria are used to determine the non-tax accounting characterization of the
transaction, the transferor intends to treat this transaction as a sale of an
interest in the principal balances of the mortgage loans for financial
accounting purposes.

                                      S-90


         In general, whether for U.S. federal income tax purposes a transaction
constitutes a sale of property or a loan, the repayment of which is secured by
property, is a question of fact, the resolution of which is based upon the
economic substance of the transaction rather than its form or the manner in
which it is labeled. While the Internal Revenue Service and the courts have set
forth several factors to be taken into account in determining whether the
substance of a transaction is a sale of property or a secured loan, the primary
factor in making this determination is whether the transferee has assumed the
risk of loss or other economic burdens relating to the property and has obtained
the benefits of ownership thereof. Tax Counsel has analyzed and relied on
several factors in reaching its opinion that the weight of the benefits and
burdens of ownership of the mortgage loans has been retained by the transferor
and has not been transferred to the beneficial owners of [Class [ ]] Notes.

         In some instances, courts have held that a taxpayer is bound by the
particular form it has chosen for a transaction, even if the substance of the
transaction does not accord with its form. Tax Counsel has advised that the
rationale of those cases will not apply to this transaction, because the form of
the transaction as reflected in the operative provisions of the documents either
accords with the characterization of the Notes as debt or otherwise makes the
rationale of those cases inapplicable to this situation.

TAXATION OF INTEREST INCOME OF BENEFICIAL OWNERS

         Assuming that the beneficial owners of [Class [ ]] Notes are holders of
debt obligations for U.S. federal income tax purposes, the Notes generally will
be taxable as Debt Securities. See "Federal Income Tax Consequences" in the
prospectus.

         While it is not anticipated that the Notes will be issued at a greater
than de minimis discount, under Treasury regulations (the "OID Regulations") it
is possible that the Notes could nevertheless be deemed to have been issued with
original issue discount ("OID") if the interest were not treated as
"unconditionally payable" under the OID Regulations. If such regulations were to
apply, all of the taxable income to be recognized with respect to the Notes
would be includible in income of beneficial owners of [Class [ ]] Notes as OID,
but would not be includible again when the interest is actually received. See
"Federal Income Tax Consequences -- Taxation of Debt Securities; Interest and
Acquisition Discount" in the prospectus for a discussion of the application of
the OID rules if the Notes are in fact issued at a greater than de minimis
discount or are treated as having been issued with OID under the OID
Regulations. For purposes of calculating OID, it is likely that the Notes will
be treated as Pay-Through Securities.

POSSIBLE CLASSIFICATION OF THE TRUST FUND AS A PARTNERSHIP OR ASSOCIATION
TAXABLE AS A CORPORATION

         Tax Counsel is of the opinion that neither the trust nor any portion of
the trust will be treated as a corporation or publicly traded partnership
taxable as a corporation. See "Material Federal Income Tax Consequences" in the
prospectus. The opinion of Tax Counsel is not binding on the courts or the IRS.
It is possible that the IRS could assert that, for purposes of the Code, the
transaction contemplated by this prospectus Supplement and the accompanying
prospectus with respect to the Notes constitutes a sale of the mortgage loans
(or an interest therein) to the beneficial owners of [Class [ ]] Notes and that
the proper classification of the

                                      S-91


legal relationship between the transferor and the beneficial owners of [Class
[ ]] Notes resulting from this transaction is that of a partnership, a publicly
traded partnership treated as a corporation, or an association taxable as a
corporation. Since Tax Counsel has advised that the Notes will be treated as
indebtedness in the hands of the noteholders for U.S. federal income tax
purposes, the transferor will not attempt to comply with U.S. federal income tax
reporting requirements applicable to partnerships or corporations.

         If it were determined that this transaction created an entity
classified as a corporation (including a publicly traded partnership taxable as
a corporation), the trust fund would be subject to U.S. federal income tax at
corporate income tax rates on the income it derives from the mortgage loans,
which would reduce the amounts available for distribution to the beneficial
owners of [Class [ ]] Notes. Cash distributions to the beneficial owners of
[Class [ ]] Notes generally would be treated as dividends for tax purposes to
the extent of such corporation's earnings and profits.

         If the trust estate were treated as creating a partnership between the
beneficial owners of [Class [ ]] Notes and the transferor, the partnership
itself would not be subject to U.S. federal income tax (unless it were to be
characterized as a publicly traded partnership taxable as a corporation);
rather, the transferor and each Note Owner would be taxed individually on their
respective distributive shares of the partnership's income, gain, loss,
deductions and credits. The amount and timing of items of income and deductions
of the Note Owner could differ if the Notes were held to constitute partnership
interests rather than indebtedness. Assuming that all of the provisions of the
trust agreement, as in effect on the date of the issuance, are complied with, it
is the opinion of Tax Counsel that the trust fund will not be treated as either
an association or a partnership taxable as a corporation or as a taxable
mortgage pool.

POSSIBLE CLASSIFICATION AS A TAXABLE MORTGAGE POOL

         In relevant part, Section 7701(i) of the Code provides that any entity
(or a portion of an entity) that is a "taxable mortgage pool" will be classified
as a taxable corporation and will not be permitted to file a consolidated U.S.
federal income tax return with another corporation. Any entity (or a portion of
any entity) will be a taxable mortgage pool if (i) substantially all of its
assets consist of debt instruments, more than 50% of which are real estate
mortgages, (ii) the entity is the obligor under debt obligations with two or
more maturities, and (iii) under the entity's debt obligations (or an underlying
arrangement), payments on the debt obligations bear a relationship to the debt
instruments held by the entity.

         Assuming that all of the provisions of the sale and servicing agreement
and the trust agreement, as in effect on the date of issuance, are complied
with, Tax Counsel is of the opinion that neither the trust fund nor any portion
of the trust fund will be a taxable mortgage pool under Section 7701(i) of the
Code because payments on each loan group support only one class of indebtedness.

         The opinion of Tax Counsel is not binding on the IRS or the courts. If
the IRS were to contend successfully (or future regulations were to provide)
that the arrangement created by the sale and servicing agreement and the trust
agreement is a taxable mortgage pool, the arrangement would be subject to U.S.
federal corporate income tax on its taxable income generated by

                                      S-92


ownership of the mortgage loans. That a tax might reduce amounts available for
distributions to beneficial owners of [Class [ ]] Notes. The amount of the tax
would depend upon whether distributions to beneficial owners of [Class [ ]]
Notes would be deductible as interest expense in computing the taxable income of
such an arrangement as a taxable mortgage pool.

FOREIGN INVESTORS

         In general, subject to certain exceptions, interest (including OID)
paid on a Note to a nonresident alien individual, foreign corporation or other
non-United States person is not subject to U.S. federal income tax, provided
that the interest is not effectively connected with a trade or business of the
recipient in the United States and the Note Owner provides the required foreign
person information certification. See "Federal Income Tax Consequences -- Tax
Treatment of Foreign Investors" in the prospectus.

         [Interest paid (or accrued) to a noteholder who is a non-U.S. Person
will be considered "portfolio interest" and generally will not be subject to
United States federal income tax and withholding tax, provided, that (i) the
interest is not effectively connected with the conduct of a trade or business
within the United States by the non-U.S. Person, (ii) the non-U.S. Person
provides the trust fund or other person who is otherwise required to withhold
U.S. tax with respect to the Note with an appropriate statement (on Form W-8BEN
or other similar form), signed under penalties of perjury, certifying that the
beneficial owner of the Note is a foreign person and providing that non-U.S.
person's name and address. If a Note is held through a securities clearing
organization or certain other financial institutions, the organization or
institution may provide the relevant signed statement to the withholding agent;
in that case, however, the signed statement must be accompanied by a Form W-8BEN
or substitute form provided by the non-U.S. Person that owns that interest in
the mortgage loan. If the interest does not constitute portfolio interest, then
it will be subject to U.S. federal income and withholding tax at a rate of 30%,
unless reduced or eliminated pursuant to an applicable tax treaty and the
non-U.S. Person provides the trust fund, or an organization or financial
institution described above, with an appropriate statement (e.g., a Form
W-8BEN), signed under penalties of perjury, to that effect.]

         If the interests of the beneficial owners of [Class [ ]] Notes were
deemed to be partnership interests, the partnership would be required, on a
quarterly basis, to pay withholding tax equal to the product, for each foreign
partner, of the foreign partner's distributive share of "effectively connected"
income of the partnership multiplied by the highest rate of tax applicable to
that foreign partner. In addition, a corporate foreign partner would be subject
to branch profits tax. Each non-foreign partner would be required to certify to
the partnership that it is not a foreign person. The tax withheld from each
foreign partner would be credited against the foreign partner's U.S. income tax
liability.

         In addition, the interest paid on Notes could be subject to a 30%
withholding tax (or lower treaty rate) either because the interest on the
mortgage loans does not appear to satisfy the requirements to be treated as
"portfolio interest" under the Code, or because, even if the mortgage loan
interest were to be treated as portfolio interest, interest payments on the
Notes could be treated as "guaranteed payments" within the meaning of the
partnership provisions of the Code.

                                      S-93


         If the trust fund were taxable as a corporation, distributions to
foreign persons, to the extent treated as dividends, would generally be subject
to withholding at the rate of 30%, unless the rate were reduced by an applicable
tax treaty.

BACKUP WITHHOLDING

         Certain beneficial owners of [Class [ ]] Notes may be subject to backup
withholding at the rate of [31]% with respect to interest paid on the Notes if
the Note Owner, upon issuance, fails to supply the indenture trustee or his
broker with his taxpayer identification number, furnish an incorrect taxpayer
identification number, fail to report interest, dividends, or other "reportable
payments" (as defined in the Code) properly, or, under certain circumstances,
fail to provide the indenture trustee or his broker with a certified statement,
under penalty of perjury, that he is not subject to backup withholding.

         The indenture trustee will be required to report annually to the IRS,
and to each noteholder of record, the amount of interest paid (and OID accrued,
if any) on the Notes (and the amount of interest withheld for U.S. federal
income taxes, if any) for each calendar year, except as to exempt holders
(generally, holders that are corporations, certain tax-exempt organizations or
nonresident aliens who provide certification as to their status as
nonresidents). As long as the only "noteholder" of record is Cede & Co., as
nominee for DTC, beneficial owners of [Class [ ]] Notes and the IRS will receive
tax and other information including the amount of interest paid on the Notes
owned from participants and indirect participants rather than from the indenture
trustee. (The indenture trustee, however, will respond to requests for necessary
information to enable participants, indirect participants and certain other
persons to complete their reports.) Each non-exempt Note Owner will be required
to provide, under penalty of perjury, a note on IRS Form W-9 containing his or
her name, address, correct federal taxpayer identification number and a
statement that he or she is not subject to backup withholding. Should a
nonexempt Note Owner fail to provide the required certification, the
participants or indirect participants (or the paying agent) will be required to
withhold 31% of the interest (and principal) otherwise payable to the holder,
and remit the withheld amount to the IRS as a credit against the holder's
federal income tax liability.

                                   OTHER TAXES

         The depositor makes no representations regarding the tax consequences
of purchase, ownership or disposition of the Notes under the tax laws of any
state.

         ALL INVESTORS SHOULD CONSULT THEIR OWN TAX ADVISORS REGARDING THE
FEDERAL, STATE, LOCAL OR FOREIGN INCOME TAX CONSEQUENCES OF THE PURCHASE,
OWNERSHIP AND DISPOSITION OF THE NOTES.

                              ERISA CONSIDERATIONS

         Fiduciaries of employee benefit plans and certain other retirement
plans and arrangements that are subject to ERISA or corresponding provisions of
the Code, including individual retirement accounts and annuities, Keogh plans
and collective investment funds in which the plans, accounts, annuities or
arrangements are invested, persons acting on behalf of a plan, or persons using
the assets of a plan, should review carefully with their legal advisors

                                      S-94


whether the purchase or holding of the Notes could either give rise to a
transaction that is prohibited under ERISA or the Code or cause the collateral
securing the Notes to be treated as plan assets for purposes of regulations of
the Department of Labor in 29 C.F.R. 2510.3-101 (the "Plan Asset Regulation").

PROHIBITED TRANSACTIONS

         General. Section 406 of ERISA and Section 4975 of the Code prohibit
parties in interest or disqualified persons with respect to a plan from engaging
in certain transactions (including loans) involving a plan and its assets unless
a statutory, regulatory or administrative exemption applies to the transaction.
Section 4975 of the Code imposes certain excise taxes (or, in some cases, a
civil penalty may be assessed pursuant to section 502(i) of ERISA) on parties in
interest or disqualified persons which engage in non-exempt prohibited
transactions.

         Plan Asset Regulation and the Notes. The United States Department of
Labor has issued the Plan Asset Regulation concerning the definition of what
constitutes the assets of the plan for purposes of ERISA and the prohibited
transaction provisions of the Code. The Plan Asset Regulation describes the
circumstances under which the assets of an entity in which a plan invests will
be considered to be "plan assets" such that any person who exercises control
over the assets would be subject to ERISA's fiduciary standards. Under the Plan
Asset Regulation, generally when a plan invests in another entity, the plan's
assets do not include, solely by reason of the investment, any of the underlying
assets of the entity. However, the Plan Asset Regulation provides that, if a
plan acquires an "equity interest" in an entity, the assets of the entity will
be treated as assets of the plan investor unless certain exceptions not
applicable here apply.

         Under the Plan Asset Regulation, the term "equity interest" is defined
as any interest in an entity other than an instrument that is treated as
indebtedness under "applicable local law" and which has no "substantial equity
features." If the Notes are not treated as equity interests in the issuer for
purposes of the Plan Asset Regulation, a plan's investment in the Notes would
not cause the assets of the issuer to be deemed plan assets. Based on the
features of the notes, their ratings, and the opinion of Tax Counsel that they
will be treated as indebtedness for federal income tax purposes, the issuer
believes that the notes should be treated as indebtedness without substantial
equity features for ERISA purposes. Nevertheless, the issuer, the master
servicer, a servicer, the indenture trustee and the underwriter may be the
sponsor of or investment advisor with respect to one or more plans. Because they
may receive certain benefits in connection with the sale of the Notes, the
purchase of Notes using plan assets over which any of them has investment
authority might be deemed to be a violation of the prohibited transaction rules
of ERISA and the Code for which no exemption may be available.

         The Notes may not be purchased with the assets of a plan if the issuer,
the master servicer, a servicer, the indenture trustee, the underwriter or any
of their respective affiliates:

         o    has investment or administrative discretion with respect to the
              plan assets;

         o    has authority or responsibility to give, or regularly gives,
              investment advice with respect to the plan assets, for a fee and
              pursuant to an agreement or understanding that the advice (i)
              will serve as a primary basis for investment decisions with
              respect o the plan assets, and (ii) will be based on the
              particular investment needs for the plan; or

                                      S-95


         o    is an employer maintaining or contributing to the plan.

         If the Notes are deemed to be equity interests in the issuer, the
issuer could be considered to hold plan assets because of a plan's investment in
the Notes. In that event, the master servicer and other persons exercising
management or discretionary control over the assets of the issuer may be deemed
to be fiduciaries with respect to investing plans and thus subject to the
fiduciary responsibility provisions of Title 1 of ERISA, including the
prohibited transaction provisions of section 406 of ERISA, and section 4975 of
the Code with respect to transactions involving the issuer's assets. We cannot
assure you that any statutory, regulatory or administrative exemption will apply
to all prohibited transactions that might arise in connection with the purchase
or holding of a equity interest in the issuer by a plan.

         Without regard to whether the Notes are considered to be equity
interests in the issuer, certain affiliates of the issuer or the master servicer
might be considered or might become parties in interest or disqualified persons
with respect to a plan. In either case, the acquisition or holding of Notes by
or on behalf of the plan could be considered to give rise to an indirect
prohibited transaction within the meaning of ERISA and the Code, unless it is
subject to one or more exemptions such as Prohibited Transaction Class Exemption
("PTCE") 84-14, which exempts certain transactions effected on behalf of a plan
by a "qualified professional asset manager"; PTCE 90-1, which exempts certain
transactions involving insurance company pooled separate accounts; PTCE-91-38,
which exempts certain transactions involving bank collective investment funds;
PTCE 95-60, which exempts certain transactions involving insurance company
general accounts; or PTCE 96-23, which exempts certain transactions effected on
behalf of a plan by certain "in-house asset managers." Each purchaser or
transferee of a Note that is a plan investor shall be deemed to have represented
that the relevant conditions for exemptive relief under at least one of the
foregoing exemptions have been satisfied. Prospective transferees and purchasers
should consider that a prohibited transaction exemption may not apply to all
prohibited transactions that may arise in connection with a plan's investment in
the notes.

         The sale of Notes to a plan is in no respect a representation by the
issuer or the underwriter that this investment meets all relevant legal
requirements with respect to investments by plans generally or any particular
plan, or that this investment is appropriate for plans generally or any
particular plan.

         ANY PLAN INVESTOR PROPOSING TO INVEST IN THE NOTES SHOULD CONSULT WITH
ITS COUNSEL TO CONFIRM THAT THE INVESTMENT WILL NOT RESULT IN A PROHIBITED
TRANSACTION THAT IS NOT SUBJECT TO AN EXEMPTION AND WILL SATISFY THE OTHER
REQUIREMENTS OF ERISA AND THE CODE APPLICABLE TO PLANS.

                         LEGAL INVESTMENT CONSIDERATIONS

         Although, as a condition to their issuance, the [Class [ ]] Notes will
be rated in the highest rating category of each of the Rating Agencies, the
[Class [ ]] Notes will not constitute "mortgage related securities" for purposes
of the Secondary Mortgage Market Enhancement Act of 1984, because not all of the
mortgages securing the mortgage loans are first mortgages. Accordingly, many
institutions with legal authority to invest in comparably rated securities based
on first mortgage loans may not be legally authorized to invest in the [Class
[ ]] Notes, which

                                      S-96


because they evidence interests in a pool that includes junior mortgage loans
are not "mortgage related securities" under SMMEA. See "Legal Investment" in the
prospectus.

                                  UNDERWRITING

         Pursuant to the underwriting agreement, dated [ ], 200[ ], between the
depositor and [ ] ("[ ]"), [which is an affiliate of the depositor, the seller
and the master servicer,] the depositor has agreed to sell to [ ], and [ ] has
agreed to purchase from the depositor, the [Class [ ]] Notes.

         Pursuant and subject to the underwriting agreement, [ ] has agreed to
purchase all the [Class [ ]] Notes if any of the [Class [ ]] Notes are
purchased.

         The depositor has been advised by [ ] that it proposes initially to
offer the [Class [ ]] Notes to the public in Europe and the United States at the
offering price on the cover page and to certain dealers at the offering price
less a discount not in excess of [ ]% of the Note denominations. [ ] may allow
and the dealers may reallow a discount not in excess of [ ]% of the Note
denominations to certain other dealers. After the initial public offering, the
public offering price, the concessions and the discounts may be changed.

         Until the distribution of the [Class [ ]] Notes is completed, rules of
the Securities and Exchange Commission may limit the ability of [ ] and certain
selling group members to bid for and purchase the [Class [ ]] Notes. As an
exception to these rules, [ ] is permitted to engage in certain transactions
that stabilize the price of the [Class [ ]] Notes. Stabilizing transactions
consist of bids or purchases for the purposes of pegging, fixing or maintaining
the price of the [Class [ ]] Notes. In general, purchases of a security for the
purpose of stabilization or to reduce a short position could cause the price of
the security to be higher than it might be in the absence of stabilizing
purchases. Neither the depositor nor [ ] makes any representation or prediction
as to the direction or magnitude of any effect that the stabilizing transactions
may have on the prices of the Notes. In addition, neither the depositor nor [ ]
makes any representation that [ ] will engage in stabilizing transactions or
that stabilizing transactions, once commenced, will not be discontinued without
notice.

         The underwriting agreement provides that the depositor will indemnify [
] against certain civil liabilities, including liabilities under the Act.

                                  LEGAL MATTERS

         Certain legal matters with respect to the Notes will be passed on for
the depositor by Sidley Austin Brown & Wood LLP, New York, New York. [ ], will
pass on certain legal matters on behalf of the underwriters.

                                     EXPERTS

         [The consolidated financial statements of [Note Insurer] and
subsidiaries, as of [month] [day], [year] and [year] and for each of the years
in the [number]-year period ended [month] [day], [year], are incorporated by
reference in this prospectus supplement and in the registration statement in
reliance upon the report of [ ], independent certified public accountants,

                                      S-97


incorporated by reference in this prospectus supplement, and on the authority of
that firm as experts in accounting and auditing.]

                                     RATINGS

         It is a condition to the issuance of the Class [ ] [and Class [ ]]
Notes that they [each] be rated [ ] by [Rating Agency] and [ ] by [Rating
Agency] (each a "Rating Agency").

         A securities rating addresses the likelihood of the receipt by
noteholders of distributions on the mortgage loans. The rating takes into
consideration the characteristics of the mortgage loans and the structural and
legal aspects associated with the [Class [ ]] Notes. The ratings on the [Class [
]] Notes do not, however, constitute statements regarding the likelihood or
frequency of prepayments on the mortgage loans or the possibility that
noteholders might realize a lower than anticipated yield. The ratings on the
[Class [ ]] Notes do not address the likelihood of the receipt by noteholders of
Basis Risk Carryforward.

         The ratings assigned to the [Class [ ]] Notes will depend primarily
upon the financial strength of the Note Insurer. Any reduction in a rating
assigned to the financial strength of the Note Insurer below the ratings
initially assigned to the [Class [ ]] Notes may result in a reduction of one or
more of the ratings assigned to the [Class [ ]] Notes.

         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. Each securities rating should be evaluated
independently of similar ratings on different securities.

         The depositor has not requested a rating of the [Class [ ]] Notes by
any rating agency other than the Rating Agencies; however, we cannot assure you
that no other rating agency will rate the [Class [ ]] Notes or, if it does, what
rating would be assigned by another rating agency. The rating assigned by
another rating agency to the [Class [ ]] Notes could be lower than the
respective ratings assigned by the Rating Agencies.


                                      S-98




                             INDEX OF DEFINED TERMS

                                                  Page
                                                  ----
Accelerated Principal Distribution Amount..........61
Additional Balances................................19
Additional Home Equity Loans.......................27
Additional Loan Account............................27
Alternative Principal Payment......................65
Available Transferor Subordinated Amount...........66
Bankruptcy Rate....................................23
Basis Risk Carryforward............................63
Business day.......................................61
Class..............................................53
Class [   ] Original Invested Amount...............54
Class [   ] Original Note Principal Balance........54
Clearstream, Luxembourg............................57
Code...............................................90
Collection Period..................................63
Crossover Amount...................................62
Debt Securities....................................91
Defective Mortgage Loans...........................82
Detailed Description...............................24
Determination Date.................................67
DTC.............................................A-I-1
Eligible Account...................................67
Eligible Substitute Mortgage Loan..................81
Events of Servicing Termination....................87
First Federal......................................21
Foreclosure Rate...................................23
Global Securities...............................A-I-1
Guaranteed Distributions...........................71
Guaranteed Principal Distribution Amount...........71
Holdings...........................................21
IndyMac Bank.......................................21
Insurance Agreement................................71
Insured Amount.....................................71
Interest Period....................................64
Investor Fixed Allocation Percentage...............51
Investor Floating Allocation Percentage............70
Investor Interest Collections......................69
Investor Loss Amount...............................62
Investor Principal Collections.....................70
LIBOR..............................................63
Liquidated Mortgage Loan...........................63
Liquidation Loss Amount............................62
Managed Amortization Period........................65
Maximum Principal Payment..........................65
Minimum Transferor Interest........................83
New Withholding Regulations........................94
Note Insurer.......................................21
Notes..............................................53
OID................................................92
OID Regulations....................................92
Original Invested Amount...........................54
Overcollateralization Reduction Amount.............70
Plan Asset Regulation..............................96
Preference Amount..................................71
PTCE...............................................97
Rapid Amortization Event...........................72
Rapid Amortization Period..........................65
Rating Agency......................................99
Related Documents..................................79
Required Amount....................................66
Reserve Fund.......................................70
Rules..............................................56
Scheduled Principal Collections Distribution Amount65
Statistical Calculation Date.......................25
Statistical Calculation Pool.......................24
Statistical Calculation Pool Mortgage Loan.........24
Subordinated Transferor Collections................66
Tax Counsel........................................91
Taxable mortgage pool..............................93
TIA................................................77
Transfer Date......................................82
Transfer Deficiency................................81
Transfer Deposit Amount............................81
Transferor Principal Collections...................70
U.S. Person.....................................A-I-5


                                      S-99


                                     ANNEX I

                      GLOBAL CLEARANCE, SETTLEMENT AND TAX
                            DOCUMENTATION PROCEDURES

         Except in certain limited circumstances, the globally offered Home
Equity Loan Asset Backed Notes, Series [200[ ]-[ ]] (the "Global Securities")
will be available only in book-entry form. Investors in the Global Securities
may hold them through any of The Depository Trust Company ("DTC"), Clearstream,
Luxembourg or Euroclear. The Global Securities will be tradeable as home market
instruments in both the European and U.S. domestic markets. Initial settlement
and all secondary trades will settle in same-day funds.

         Secondary market trading between investors holding interests in Global
Securities through Clearstream, Luxembourg and Euroclear will be conducted in
accordance with their normal rules and operating procedures and in accordance
with conventional eurobond practice (i.e., seven calendar day settlement).
Secondary market trading between investors holding interests in Global
Securities through DTC will be conducted according to the rules and procedures
applicable to U.S. corporate debt obligations.

         Secondary cross-market trading between investors holding interests in
Global Securities through Clearstream, Luxembourg or Euroclear and investors
holding interests in Global Securities through DTC participants will be effected
on a delivery-against-payment basis through the respective depositories of
Clearstream, Luxembourg and Euroclear (in that capacity) and other DTC
participants.

         Although DTC, Euroclear and Clearstream, Luxembourg are expected to
follow the procedures described below to facilitate transfers of interests in
the Global Securities among participants of DTC, Euroclear and Clearstream,
Luxembourg, they are under no obligation to perform or continue to perform those
procedures, and those procedures may be discontinued at any time. Neither the
Issuer nor the indenture trustee will have any responsibility for the
performance by DTC, Euroclear and Clearstream, Luxembourg or their respective
participants or indirect participants of their respective obligations under the
rules and procedures governing their obligations.

         Non-U.S. holders (as described below) of Global Securities will be
subject to U.S. withholding taxes unless the holders meet certain requirements
and deliver appropriate U.S. tax documents to the securities clearing
organizations or their participants.

INITIAL SETTLEMENT

         The Global Securities will be registered in the name of Cede & Co. as
nominee of DTC. Investors" interests in the Global Securities will be
represented through financial institutions acting on their behalf as direct and
indirect participants in DTC. Clearstream, Luxembourg and Euroclear will hold
positions on behalf of their participants through their respective depositories,
which in turn will hold the positions in accounts as DTC participants.

         Investors electing to hold interests in Global Securities through DTC
participants, rather than through Clearstream, Luxembourg or Euroclear accounts,
will be subject to the settlement


                                     A-I-1


practices applicable to similar issues of pass-through notes. Investors"
securities custody accounts will be credited with their holdings against payment
in same-day funds on the settlement date.

         Investors electing to hold interests in Global Securities through
Clearstream, Luxembourg or Euroclear accounts will follow the settlement
procedures applicable to conventional eurobonds, except that there will be no
temporary global security and no "lock-up" or restricted period. Interests in
Global Securities will be credited to the securities custody accounts on the
settlement date against payment in same-day funds.

SECONDARY MARKET TRADING

         Since the purchaser determines the place of delivery, it is important
to establish at the time of the trade where both the purchaser's and seller's
accounts are located to ensure that settlement can be made on the desired value
date.

         Transfers between DTC Participants. Secondary market trading between
DTC participants will be settled using the DTC procedures applicable to similar
issues of pass-through notes in same-day funds.

         Transfers between Clearstream, Luxembourg and/or Euroclear
Participants. Secondary market trading between Clearstream, Luxembourg
participants or Euroclear participants and/or investors holding interests in
Global Securities through them will be settled using the procedures applicable
to conventional eurobonds in same-day funds.

         Transfers between DTC seller and Clearstream, Luxembourg or Euroclear
purchaser. When interests in Global Securities are to be transferred on behalf
of a seller from the account of a DTC participant to the account of a
Clearstream, Luxembourg participant or a Euroclear participant or a purchaser,
the purchaser will send instructions to Clearstream, Luxembourg or Euroclear
through a Clearstream, Luxembourg participant or Euroclear participant at least
one business day before settlement. Clearstream, Luxembourg or the Euroclear
operator will instruct its respective depository to receive an interest in the
Global Securities against payment. Payment will include interest accrued on the
Global Securities from and including the last payment date to but excluding the
settlement date. Payment will then be made by the respective depository to the
DTC participant's account against delivery of an interest in the Global
Securities. After settlement has been completed, the interest will be credited
to the respective clearing system, and by the clearing system, in accordance
with its usual procedures, to the Clearstream, Luxembourg participant's or
Euroclear participant's account. The credit of the interest will appear on the
next business day and the cash debit will be back-valued to, and the interest on
the Global Securities will accrue from, the value date (which would be the
preceding day when settlement occurred in New York). If settlement is not
completed through DTC on the intended value date (i.e., the trade fails), the
Clearstream, Luxembourg or Euroclear cash debit will be valued instead as of the
actual settlement date.

         Clearstream, Luxembourg participants and Euroclear participants will
need to make available to the respective clearing system the funds necessary to
process same-day funds settlement. The most direct means of doing so is to
pre-position funds for settlement from cash

                                     A-I-2


on hand, in which case the Clearstream, Luxembourg participants or Euroclear
participants will take on credit exposure to Clearstream, Luxembourg or the
Euroclear operator until interests in the Global Securities are credited to
their accounts one day later.

         As an alternative, if Clearstream, Luxembourg or the Euroclear operator
has extended a line of credit to them, Clearstream, Luxembourg participants or
Euroclear participants can elect not to pre-position funds and allow that credit
line to be drawn upon. Under this procedure, Clearstream, Luxembourg
participants or Euroclear participants receiving interests in Global Securities
for purchasers would incur overdraft charges for one day, to the extent they
cleared the overdraft when interests in the Global Securities were credited to
their accounts. However, interest on the Global Securities would accrue from the
value date. Therefore, the investment income on the interest in the Global
Securities earned during that one-day period would tend to offset the amount of
the overdraft charges, although this result will depend on each Clearstream,
Luxembourg participant's or Euroclear participant's particular cost of funds.

         Since the settlement through DTC will take place during New York
business hours, DTC participants are subject to DTC procedures for transferring
interests in Global Securities to the respective depository of Clearstream,
Luxembourg or Euroclear for the benefit of Clearstream, Luxembourg participants
or Euroclear participants. The sale proceeds will be available to the DTC seller
on the settlement date. Thus, to the seller settling the sale through a DTC
participant, a cross-market transaction will settle no differently than a sale
to a purchaser settling through a DTC participant.

         Finally, intra-day traders that use Clearstream, Luxembourg
participants or Euroclear participants to purchase interests in Global
Securities from DTC participants or sellers settling through them for delivery
to Clearstream, Luxembourg participants or Euroclear participants should note
that these trades will automatically fail on the sale side unless affirmative
action is taken. At least three techniques should be available to eliminate this
potential condition:

                  (a) borrowing interests in Global Securities through
         Clearstream, Luxembourg or Euroclear for one day (until the purchase
         side of the intra-day trade is reflected in the relevant Clearstream,
         Luxembourg or Euroclear accounts) in accordance with the clearing
         system's customary procedures;

                  (b) borrowing interests in Global Securities in the United
         States from a DTC participant no later than one day before settlement,
         which would give sufficient time for the interests to be reflected in
         the relevant Clearstream, Luxembourg or Euroclear accounts to settle
         the sale side of the trade; or

                   (c) staggering the value dates for the buy and sell sides of
         the trade so that the value date for the purchase from the DTC
         participant is at least one day before the value date for the sale to
         the Clearstream, Luxembourg participant or Euroclear participant.

         Transfers between Clearstream, Luxembourg or Euroclear seller and DTC
purchaser. Due to time zone differences in their favor, Clearstream, Luxembourg
participants and Euroclear participants may employ their customary procedures
for transactions in which interests in Global Securities are to be transferred
by the respective clearing system, through the respective


                                     A-I-3


depository, to a DTC participant. The seller will send instructions to
Clearstream, Luxembourg or the Euroclear operator through a Clearstream,
Luxembourg participant or Euroclear participant at least one business day before
settlement. Clearstream, Luxembourg or Euroclear will instruct its respective
depository to credit an interest in the Global Securities to the DTC
participant's account against payment. Payment will include interest accrued on
the Global Securities from and including the last payment date to but excluding
the settlement date. The payment will then be reflected in the account of the
Clearstream, Luxembourg participant or Euroclear participant the following
business day, and receipt of the cash proceeds in the Clearstream, Luxembourg
participant's or Euroclear participant's account would be back-valued to the
value date (which would be the preceding day, when settlement occurred through
DTC in New York). If settlement is not completed on the intended value date
(i.e., the trade fails), receipt of the cash proceeds in the Clearstream,
Luxembourg participant's or Euroclear participant's account would instead be
valued as of the actual settlement date.

CERTAIN U.S. FEDERAL INCOME TAX DOCUMENTATION REQUIREMENTS

         A Beneficial Owner of Global Securities holding securities through
Clearstream, Luxembourg or Euroclear (or through DTC if the holder has an
address outside the United States) will be subject to the 30% U.S. withholding
tax that generally applies to payments of interest (including original issue
discount) on registered debt issued by U.S. Persons, unless (i) each clearing
system, bank or other financial institution that holds customers" securities in
the ordinary course of its trade or business in the chain of intermediaries
between the Beneficial Owner and the U.S. entity required to withhold tax
complies with applicable certification requirements and (ii) the beneficial
owner takes one of the following steps to obtain an exemption or reduced tax
rate:

         Exemption for non-U.S. Persons ([Form W-8 or] W-8BEN). Beneficial
Owners of Notes that are non-U.S. Persons can obtain a complete exemption from
the withholding tax by filing a signed [Form W-8 (Note of Foreign Status) or]
Form W-8BEN (Note of Foreign Status of Beneficial Ownership for United States
Tax Withholding). If the information shown on Form [W-8] changes a new Form
[W-8] must be filed within 30 days of the change. [RIDER A-1-A] of another or
non-U.S. flow-through entity (which includes a partnership, trust and certain
fiscally transparent entities).

         Exemption for non-U.S. Persons with effectively connected income ([Form
4224 or] Form W-8ECI). A non-U.S. Person, including a non-U.S. corporation or
bank with a U.S. branch, for which the interest income is effectively connected
with its conduct of a trade or business in the United States can obtain an
exemption from the withholding tax by Form W-8ECI (Certificate of Foreign
Person's Claim for Exemption from Withholding or Income Effectively Connected
with the Conduct of a Trade or Business in the United States).

         Exemption or reduced rate for non-U.S. Persons resident in treaty
countries ([Form 1001 or] Form W-8BEN). Non-U.S. Persons that are Beneficial
Owners residing in a country that has a tax treaty with the United States can
obtain an exemption or reduced tax rate (depending on the treaty terms) by
filing [Form 1001 (Ownership, Exemption or Reduced Rate Note) or] Form W-8BEN
(Note of Foreign Status of Beneficial Ownership for United States Tax
Withholding). If the treaty provides only for a reduced rate, withholding tax
will be imposed at that rate unless the

                                     A-I-4


filer alternatively files Form [W-8]. Form [1001] may be filed by the Beneficial
Owner or his agent.

         Exemption for U.S. Persons (Form W-9). U.S. Persons can obtain a
complete exemption from the withholding tax by filing Form W-9 (Payer's Request
for Taxpayer Identification Number and Certification).

         [U.S. Federal Income Tax Reporting Procedure. The Beneficial Owner of a
Global Security or, in the case of a Form 1001 or a Form 4224 filer, his agent,
files by submitting the appropriate form to the person through whom it holds
(the clearing agency, in the case of persons holding directly on the books of
the clearing agency).

Form W-8, Form 1001 and Form 4224 are effective until December 31, 2000. Form
W-8BEN and Form W-8ECI are effective until the third succeeding calendar year
from the date the form is signed.]

         The term "U.S. Person" means (i) a citizen or resident of the United
States, (ii) a corporation or partnership or other entity treated as a
corporation or partnership for federal income tax purposes created or organized
in or under the laws of the United States, any State thereof or the District of
Columbia or (iii) an estate the income of which is includable in gross income
for United States tax purposes, regardless of its source or (iv) a trust if a
court within the United States is able to exercise primary supervision of the
administration of the trust and one or more United States fiduciaries have the
authority to control all substantial decisions of the trust. This summary does
not deal with all aspects of U.S. Federal income tax withholding that may be
relevant to foreign holders of the Global Securities. Investors are advised to
consult their own tax advisors for specific tax advice concerning their holding
and disposing of the Global Securities.


                                     A-I-5




                               $[               ]
                                  (APPROXIMATE)


                    INDYMAC HOME EQUITY LOAN TRUST 200[ ]-[ ]


                                INDYMAC ABS, INC.
                                    DEPOSITOR


                                     [LOGO]
                           SELLER AND MASTER SERVICER


                           REVOLVING HOME EQUITY LOAN
                      ASSET BACKED NOTES, SERIES 200[ ]-[ ]


                             ----------------------

                             PROSPECTUS SUPPLEMENT

                             ----------------------


                                  [UNDERWRITER]


         You should rely only on the information contained or incorporated by
reference in this prospectus supplement and the accompanying prospectus. We have
not authorized anyone to provide you with different information.

         We are not offering the Series 200[ ]-[ ] Home Equity Loan Asset Backed
Notes in any state where the offer is not permitted.

         Dealers will deliver a prospectus supplement and prospectus when acting
as underwriters of the Series 200[ ]-[ ] Home Equity Loan Asset Backed Notes and
with respect to their unsold allotments or subscriptions. In addition, all
dealers selling the Series 200[ ]-[ ] Home Equity Loan Asset Backed Notes will
be required to deliver a prospectus supplement and prospectus until 90 days
after the date of this prospectus supplement.

                                [         ], 200[  ]

The information in this prospectus supplement is not complete and may be
changed. We may not sell these securities until the registration statement filed
with the Securities and Exchange Commission is effective. This prospectus
supplement is not an offer to sell these securities and we are not soliciting
offers to buy these securities in any state where the offer or sale is not
permitted.


                 SUBJECT TO COMPLETION, DATED SEPTEMBER 10, 2004

PROSPECTUS SUPPLEMENT
(To Prospectus dated      , 200[ ])


                            $           (APPROXIMATE)
                                INDYMAC ABS, INC.
                                    DEPOSITOR

                                     [LOGO]

                           SELLER AND MASTER SERVICER

                  HOME EQUITY MORTGAGE LOAN ASSET-BACKED TRUST,
                               SERIES SPMD 200[ ]-
                                     ISSUER

 DISTRIBUTIONS PAYABLE ON THE [ ] TH DAY OF EACH MONTH, COMMENCING IN [ ] 200[ ]

Consider carefully the risk factors beginning on page S-[ ] in this prospectus
supplement and on page [ ] in the prospectus. The certificates represent
obligations of the trust only and do not represent an interest in or obligation
of IndyMac ABS, Inc., [IndyMac Bank, F.S.B.] or any of their affiliates. This
prospectus supplement may be used to offer and sell the offered certificates
only if accompanied by the prospectus.

The following classes of certificates are being offered pursuant to this
prospectus supplement and the accompanying prospectus.



            INITIAL
       CLASS CERTIFICATE  PASS-THROUGH                   UNDERWRITING  PROCEEDS TO
CLASS       BALANCE           RATE      PRICE TO PUBLIC    DISCOUNT     DEPOSITOR
-----       -------           ----      ---------------    --------     ---------

AF-1       $                        %                 %            %              %
MF-1       $                        %                 %            %              %
MF-2       $                        %                 %            %              %
BF         $                        %                 %            %              %
AV-1       $                        %                 %            %              %
MV-1       $                        %                 %            %              %
MV-2       $                        %                 %            %              %
BV         $                        %                 %            %              %
R          $                        %                 %            %              %
         ------------     -----------   ---------------  -----------   ------------
Total      $                            $                $             $
                                        ===============  ===========   ============


     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 prospectus.
Any representation to the contrary is a criminal offense.

     [Name of Underwriter], as underwriters, will purchase the offered
certificates from the depositor. See "Method of Distribution" in this prospectus
supplement. Delivery of the certificates will take place in book entry form on
or about [_____________________].


                              [Name of Underwriter]

                                         , 200[ ]



                                TABLE OF CONTENTS


SUMMARY........................................................................1

RISK FACTORS...................................................................1

THE MORTGAGE POOL..............................................................9

   General....................................................................10
   Assignment of the Mortgage Loans...........................................31
   Conveyance of Subsequent Mortgage Loans....................................33
   Underwriting Standards.....................................................34

SERVICING OF MORTGAGE LOANS...................................................37

   The Master Servicer........................................................37
   Foreclosure, Delinquency and Loss Experience...............................38
   Servicing Compensation and Payment of Expenses.............................40
   Adjustment to Servicing Compensation in Connection with
      Certain Prepaid Mortgage Loans..........................................40
   Advances...................................................................41
   Certain Modifications and Refinancings.....................................42
   Default Management Services................................................42

DESCRIPTION OF THE CERTIFICATES...............................................42

   General....................................................................42
   Book-Entry Certificates....................................................43
   Payments on Mortgage Loans; Accounts.......................................44
   Distributions..............................................................45
   Priority of Distributions Among Certificates...............................45
   Distributions of Interest and Principal....................................46
   Calculation of One-Month LIBOR.............................................53
   Excess Reserve Fund Account................................................54
   Overcollateralization Provisions...........................................54
   Structuring Assumptions....................................................56
   Optional Termination.......................................................59
   The Trustee................................................................60
   Restrictions on Transfer of the Class R Certificates.......................60

YIELD, PREPAYMENT AND MATURITY CONSIDERATIONS.................................60

   General....................................................................60
   Defaults in Delinquent Payments............................................61
   Prepayment Considerations and Risks........................................61
   Adjustable Rate Certificates...............................................63
   Fixed Rate Certificates....................................................64
   Overcollateralization Provisions...........................................64
   Subordinated Certificates..................................................65
   Additional Information.....................................................66
   Weighted Average Lives of the Offered Certificates.........................66
   Decrement Tables...........................................................66
   Prepayment Scenarios.......................................................67
   Last Scheduled Distribution Date...........................................69

USE OF PROCEEDS...............................................................69

FEDERAL INCOME TAX CONSEQUENCES...............................................69

   General....................................................................69
   Taxation of Regular Interests..............................................70



   Status of the Offered Certificates.........................................71
   The Cap Contract Component.................................................71
   The Class R Certificate....................................................72

ERISA CONSIDERATIONS..........................................................72

METHOD OF DISTRIBUTION........................................................75

LEGAL MATTERS.................................................................76

RATINGS.......................................................................76

GLOBAL CLEARANCE, SETTLEMENT AND TAX DOCUMENTATION PROCEDURES.................78

   Initial Settlement.........................................................78
   Secondary Market Trading...................................................79
   Certain U.S. Federal Income Tax Documentation Requirements.................81

INDEX OF DEFINED TERMS.........................................................1


                                        2


                                     SUMMARY

THIS SUMMARY HIGHLIGHTS SELECTED INFORMATION FROM THIS DOCUMENT AND DOES NOT
CONTAIN ALL OF THE INFORMATION THAT YOU NEED TO CONSIDER IN MAKING YOUR
INVESTMENT DECISION. TO UNDERSTAND ALL OF THE TERMS OF AN OFFERING OF THE
CERTIFICATES, READ CAREFULLY THIS ENTIRE DOCUMENT AND THE ACCOMPANYING
PROSPECTUS.

     Certain statements contained in or incorporated by reference in this
prospectus supplement and the accompanying prospectus consist of forward-looking
statements relating to future economic performance or projections and other
financial items. These statements can be identified by the use of
forward-looking words such as "may," "will," "should," "expects," "believes,"
"anticipates," "estimates," or other comparable words. Forward-looking
statements are subject to a variety of risks and uncertainties that could cause
actual results to differ from the projected results. Those risks and
uncertainties include, among others, general economic and business conditions,
regulatory initiatives and compliance with governmental regulations, customer
preferences and various other matters, many of which are beyond our control.
Because we cannot predict the future, what actually happens may be very
different from what we predict in our forward-looking statements.

OFFERED CERTIFICATES

     On the closing date, Home Equity Mortgage Loan Asset-Backed Trust, Series
SPMD 200[ ]- will issue [     ] classes of certificates, [     ] of which are
being offered pursuant to this prospectus supplement and the accompanying
prospectus and are listed on the cover page of this prospectus supplement. The
assets of the trust fund that will support the certificates will consist
primarily of a pool of fixed and adjustable rate, conventional, sub-prime
mortgage loans that are secured by first and second liens on one-to four-family
residential properties and certain other property and assets described in this
prospectus supplement.

[OTHER CERTIFICATES

     In addition to the offered certificates, the trust fund will issue the
Class X Certificates, which are not being offered to the public pursuant to this
prospectus supplement and the prospectus. Any information contained in this
prospectus supplement with respect to the Class X Certificates is provided only
to permit a better understanding of the offered certificates.]

CUT-OFF DATE

     For any initial mortgage loan, [_______], 200[ ]; for any subsequent
mortgage loan, [______], 200[ ].

CLOSING DATE

     On or about [__________], 200[ ].

DEPOSITOR

     IndyMac ABS, Inc., a Delaware corporation, is a limited purpose finance
subsidiary of IndyMac Bank, F.S.B. Its address is 155 North Lake Avenue,
Pasadena, California 91101, and its telephone number is (800) 669-2300.

SELLER AND MASTER SERVICER

     [IndyMac Bank, F.S.B.]

TRUSTEE



     [        ]

DESIGNATIONS

     Each class of certificates will have different characteristics. Certain of
these characteristics are reflected in the following general designations.

     o    Loan Group 1

     All mortgage loans with fixed interest rates

     o    Loan Group 2

     All mortgage loans with adjustable interest rates

     o    Group 1 Certificates

     Class AF-1, Class MF-1, Class MF-2, Class BF and Class R Certificates.

     o    Group 2 Certificates

     Class AV-1, Class MV-1, Class MV-2 and Class BV Certificates.

     o    Certificate Group

     Either the Group 1 Certificates or the Group 2 Certificates.

     o    Regular Certificates

     All classes of certificates except the Class R Certificates.

o    Residual Certificates

     Class R Certificates

o    Group 1 Class A Certificates

     Class AF-1 Certificates

o    Group 1 Mezzanine Certificates

     Class MF-1 and Class MF-2 Certificates

o    Group 1 Subordinated Certificates

     Group 1 Mezzanine Certificates and Class BF Certificates

o    Group 2 Class A Certificates

     Class AV-1 Certificates

o    Group 2 Mezzanine Certificates

     Class MV-1 and Class MV-2 Certificates

o    Group 2 Subordinated Certificates

     Group 2 Mezzanine Certificates and Class BV Certificates

o    Adjustable Rate Certificates

     Group 2 Certificates

o    Fixed Rate Certificates

     Group 1 and Class R Certificates

o    Physical Certificates

     Class X and Class R Certificates

o    Book-Entry Certificates

     All classes of certificates except the Physical Certificates.

     References to "Class A," "Class M-1," "Class M-2," "Class B," "Mezzanine
Certificates," and "Subordinated Certificates" are references to certificates of
either or both certificate groups of similar designations, as the context
requires.

DISTRIBUTION DATES

     The trustee will make distributions on the [__] th day of each calendar
month beginning in [_______], 200[ ] to the holders of record of the
certificates as of the last business day of the month preceding the
distributions. If the     th day of a month is not a business day, then the
distributions


                                       2


will be made on the next business day after the     th day of the month.

RECORD DATES

     The record date for the fixed rate certificates, the physical certificates,
and any definitive certificates is the last business day of the month preceding
the distribution date. The record date for the adjustable rate certificates as
long as they are in book entry form is the business day before the related
distribution date.

INTEREST PAYMENTS

     The pass-through rate for each class of fixed-rate certificates is
specified on the cover page of this prospectus supplement, and is subject to a
cap. Interest will accrue on the fixed rate certificates on the basis of a
360-day year divided into twelve 30-day months. The pass-through rate for each
class of adjustable rate certificates will be equal to the sum of LIBOR plus a
fixed margin, subject to a cap. Interest will accrue on the adjustable rate
certificates on the basis of a 360-day year and the actual number of days
elapsed in the applicable interest accrual period. The interest accrual period
for the fixed rate certificates for any distribution date will be the calendar
month preceding the month of that distribution date. The interest accrual period
for the adjustable rate certificates for any distribution date will be the
period from and including the preceding distribution date (or, in the case of
the first distribution date, the closing date) to and including the day prior to
the current distribution date.

     See "Description of the Certificates--Distributions of Interest and
Principal" in this prospectus supplement.

PRINCIPAL PAYMENTS

     Principal will be paid on the certificates on each distribution date as
described under "Description of the Certificates--Distributions" in this
prospectus supplement.

MORTGAGE LOANS

     On the closing date the trust fund will acquire a pool of initial mortgage
loans that will be divided into two loan groups, loan group 1 and loan group 2.

     Loan group 1 will consist of fixed-rate mortgage loans secured by first or
second liens on mortgaged properties that are transferred to the trust fund on
the closing date and any additional fixed-rate mortgage loans that are purchased
by the trust fund during the pre-funding period using the amount on deposit in
the related pre-funding account.

     Loan group 2 will consist of adjustable-rate mortgage loans secured by
first liens on mortgaged properties that are transferred to the trust fund on
the closing date and any additional mortgage loans that are purchased by the
trust fund during the pre-funding period using the amount on deposit in the
related pre-funding account.

STATISTICAL CALCULATION INFORMATION

     The statistical calculation information presented in this prospectus
supplement concerning the initial mortgage loans does not reflect all of the
mortgage loans that will be included in the trust fund as of the closing date.
The statistical calculation information presented in this prospectus supplement
concerning the initial mortgage loans relates to a statistical calculation pool
that comprises    % of the initial mortgage loans that will be


                                       3


included in the trust fund as of the closing date. The pool of initial mortgage
loans for which information is presented in this prospectus supplement is
referred to in this prospectus supplement as the statistical calculation
mortgage pool and the initial mortgage loans for which information is presented
in this prospectus supplement are referred to in this prospectus supplement as
statistical calculation initial mortgage loans. The depositor believes that the
information set forth in this prospectus supplement with respect to the
statistical calculation mortgage pool is representative of the characteristics
of the mortgage pool as it will be constituted at the closing date, although   %
of the initial mortgage loans that will be included in the mortgage pool as of
the closing date are not included in the statistical calculation mortgage pool.

     The initial mortgage loans will be transferred to the trust fund on the
closing date. The additional mortgage loans to be included in loan group 1 and
loan group 2 will be transferred to the trust fund during the pre-funding
period, which begins on the closing date and ends no later than       , 200[ ].
Accordingly, the statistical profile of the final pool of mortgage loans
following the pre-funding period will vary somewhat from the statistical profile
of the statistical calculation initial mortgage loans presented in this
prospectus supplement.

     The statistical calculation initial mortgage loans in loan group 1 consist
of fixed-rate mortgage loans with an aggregate outstanding principal balance of
approximately $      as of      , 200[ ], after giving effect to principal
payments due on or before that date. The statistical calculation initial
mortgage loans in loan group 2 consist of adjustable-rate mortgage loans with an
aggregate outstanding principal balance of approximately $      as of
      , 200[ ], after giving effect to principal payments due on or before that
date.

     As described in this prospectus supplement under "The Mortgage Pool", the
interest rates for the adjustable rate mortgage loans will generally adjust
semi-annually or annually, subject to certain caps and floors, as described in
this prospectus supplement.

     Approximately     % of the statistical calculation initial loan group 2
mortgage loans are mortgage loans that initially have a fixed rate of interest
for two or more years following their origination, and thereafter have an
adjustable rate of interest for the remaining life of the mortgage loan, as
described under "The Mortgage Pool" in this prospectus supplement.

     Approximately [ ]% and [ ]% of the statistical calculation initial mortgage
loans in loan group 1 and loan group 2, respectively, will carry borrower-paid
or lender-paid mortgage insurance.

     See "The Mortgage Pool" in this prospectus supplement.

PRE-FUNDING ACCOUNTS AND CAPITALIZED INTEREST ACCOUNTS

     At closing, the seller will deposit up to $        into two separate
pre-funding accounts, to be used to acquire additional mortgage loans from the
seller during the pre-funding period.

     Of this amount, the trust fund will apply up to $       to purchase
additional fixed-rate mortgage loans for inclusion in loan group 1 and up to $
to purchase additional adjustable-rate mortgage loans for inclusion in loan
group 2.

                                       4


     The purchase of additional mortgage loans will occur only during the
pre-funding period, which generally terminates upon the earlier of:

     o the date on which the remaining pre-funding amount for both loan groups
is less than $         , and

     o the close of business on        , 200[ ].

     At closing, the seller also will deposit funds into two separate
capitalized interest accounts, for use as necessary during the pre-funding
period to offset shortfalls in interest amounts attributable to the pre-funding
mechanism.

     Any amounts in the pre-funding accounts not used during the pre-funding
period to purchase subsequent mortgage loans will be distributed as a prepayment
of principal of the group 1 senior and group 2 senior certificates, as
applicable, on the first distribution date following the pre-funding period.

OPTIONAL TERMINATION

     The master servicer may purchase all of the remaining assets of the trust
fund after the aggregate principal balance of the mortgage loans and any real
estate owned by the trust fund as of the last day of the related remittance
period declines to 10% or less of the aggregate principal balance of the initial
mortgage loans as of the initial cut-off date plus the aggregate principal
balance of any subsequent mortgage loans the trust fund purchases as of the
applicable subsequent cut-off date.

     See "Description of the Certificates--Optional Termination" in this
prospectus supplement.

ADVANCES

     The master servicer will make cash advances with respect to delinquent
payments of principal and interest on the mortgage loans unless the master
servicer reasonably believes that the cash advances cannot be repaid from future
payments on the applicable mortgage loans. These cash advances are only intended
to maintain a regular flow of scheduled interest and principal payments on the
certificates and are not intended to guarantee or insure against losses.

     See "Servicing of Mortgage Loans--Advances" in this prospectus supplement.

CREDIT ENHANCEMENT

     Credit enhancements provide limited protection to certain holders of
certificates against shortfalls in payments received on the mortgage loans. This
transaction employs the following forms of credit enhancement.

     (a)  Subordination

     On each distribution date, classes of a certificate group that are lower in
order of payment priority than the other classes of that certificate group will
not receive payments until the classes that are higher in order of payment
priority have been paid. If there is not enough money from the mortgage loans in
a loan group on a distribution date to pay all classes of the related
certificate group, the subordinate classes of that certificate group are the
first to forego payment.

     (b)  Application of Realized Losses

     If on any distribution date, after the balances of the certificates of a
certificate group have been reduced by the amount of principal paid on that
date, the total principal balance of those certificates is greater than


                                       5


the total principal balance of the mortgage loans in the related loan group plus
any amount remaining in the related pre-funding account, the principal balance
of the outstanding certificates in that group that are lowest in order of
payment priority will be reduced by the amount of that excess.

     (c)  Overcollateralization

     Although the sum of the total principal balance of the mortgage loans in
loan group 1 and the amount on deposit in the related pre-funding account is
approximately $       , the trust is issuing only $       total principal amount
of certificates related to loan group 1. Similarly, although the sum of the
total principal balance of the mortgage loans in loan group 2 and the amount on
deposit in the related pre-funding account is approximately $       the trust is
issuing only $       total principal amount of certificates related to loan
group 2. The certificates are therefore "overcollateralized," and on any
distribution date, the amount of any overcollateralization will be available to
absorb losses from liquidated mortgage loans in the related loan group. If the
level of overcollateralization falls below what is required, the excess interest
described in the next section will be paid to the certificates as principal.
This will have the effect of reducing the principal balance of the certificates
faster than the principal balance of the mortgage loans in the related loan
group so that the required level of overcollateralization is reached.

     The mortgage loans in each loan group are expected to generate more
interest than is needed to pay interest on the related certificates because the
weighted average interest rate of the mortgage loans in each loan group is
expected to be higher than the weighted average pass-through rate on the related
certificates. Some of the excess interest with respect to a loan group will be
used to pay interest on the related certificates that was previously earned but
not paid, and some of such excess interest will be used to reimburse the related
subordinated certificates for losses that they experienced previously.

     See "Description of the Certificates--Overcollateralization Provisions" in
this prospectus supplement.

RATINGS

     The classes of certificates listed below will not be offered unless they
are assigned the following ratings by       and by        .


                                CLASS       RATING

                                A
                                R
                                M-1
                                M-2
                                B

     See "Ratings" in this prospectus supplement.

TAX STATUS

     For federal income tax purposes, in accordance with the pooling and
servicing agreement, the trustee will elect to treat the trust fund (exclusive
of certain assets) as one or more REMICs. The Regular Certificates will
represent ownership of REMIC regular interests. The Class R Certificate will
represent ownership of the sole class of residual interest in each REMIC.
Holders of Regular Certificates will be required to include in income all
interest and original issue discount, if any, on such certificates in accordance
with the accrual method of accounting regardless of the


                                       6


certificateholder's regular method of accounting.

     For further information regarding the federal income tax consequences of
investing in the offered certificates, see "Federal Income Tax Consequences" in
this prospectus supplement and in the prospectus.

ERISA CONSIDERATIONS

     Subject to the considerations set forth in "ERISA Considerations" in this
prospectus supplement and in the prospectus, the Class A Certificates may be
purchased by an employee benefit plan or other retirement arrangement subject to
the Employee Retirement Income Security Act of 1974, as amended, or Section 4975
of the Internal Revenue Code, as amended.

     If you are a fiduciary of any employee benefit plan or other retirement
arrangement subject to the Employee Retirement Income Security Act of 1974, as
amended, or Section 4975 of the Internal Revenue Code, as amended, you should
review carefully with your lawyer whether you can buy or hold an offered
certificate.

     A fiduciary of an employee benefit plan must determine that the purchase of
a certificate is consistent with its fiduciary duties under applicable law and
does not result in a nonexempt prohibited transaction under applicable law.

     See "ERISA Considerations" in this prospectus supplement and in the
prospectus.

LEGAL INVESTMENT

     Upon termination of the pre-funding period, the [Class AV-1 and the Class
MV-1] Certificates will be "mortgage related securities" for purposes of the
Secondary Mortgage Market Enhancement Act of 1984 so long as they are rated in
one of the two highest rating categories by at least one rating agency. All
other certificates will not be "mortgage related securities" for purposes of
SMMEA.

     See "Legal Investment" in the prospectus.

                                       7


                                  RISK FACTORS

     The following information, which you should carefully consider, identifies
certain significant sources of risk associated with an investment in the
certificates. You should also carefully consider the information set forth under
"Risk Factors" in the prospectus.

YOU MAY HAVE DIFFICULTY SELLING YOUR CERTIFICATES

     Each underwriter intends to make a secondary market in the certificates
purchased by it, but no underwriter has any obligation to do so. We cannot
assure you that a secondary market will develop or, if it develops, that it will
continue. Consequently, you may not be able to sell your certificates readily or
at prices that will enable you to realize your desired yield. The market values
of the certificates are likely to fluctuate; these fluctuations may be
significant and could result in significant losses to you.

     The secondary markets for mortgage backed and asset backed securities have
experienced periods of illiquidity and can be expected to do so in the future.
Illiquidity can have a severely adverse effect on the prices of securities
especially those that are sensitive to prepayment, credit, or interest rate
risk, or that have been structured to meet the investment requirements of
limited categories of investors.

SUBPRIME MORTGAGE LOANS ARE SUBJECT  TO GREATER RISK OF DELINQUENCY  AND LOSS

     Most of the mortgage loans in the mortgage pool were made to borrowers with
prior credit difficulties[ and do not satisfy the underwriting guidelines for
mortgage loans eligible for sale to Fannie Mae or Freddie Mac]. We expect that
the rates of delinquency, bankruptcy and foreclosure for the mortgage loans will
be higher, and may be substantially higher, than those of mortgage loans
underwritten in accordance with Fannie Mae and Freddie Mac standards. See "The
Mortgage Pool--Underwriting Standards" in this prospectus supplement.

     The subordinated certificates have a greater risk of loss than the Class A
Certificates, and subordination may not be sufficient to protect the

CLASS A CERTIFICATES FROM LOSSES

     If you buy a Class M-1, Class M-2 or Class B Certificate, you will not
receive any payments on your certificate until the holders of the related Class
A Certificates have received all payments to which they are entitled.
Additionally, payments on the Class M-2 Certificates will be subordinate to
payments on the related Class M-1 Certificates and payments on the Class B
Certificates will be subordinate to payments on the related Class M-1 and Class
M-2 Certificates. As a result, the yield on your subordinated certificate will
be sensitive to losses on the mortgage loans in the related loan group. This
sensitivity increases with the subordination of a certificate, so that the yield
on the Class B Certificate is the most sensitive. You should carefully consider
the risk that you may lose all or a part of the money that you paid for the
subordinated certificate if losses are greater than expected.



     If you buy a subordinated certificate you will not receive any principal
distributions until at the earliest, unless the related Class A Certificates
have been paid down to zero before that date. As a result, your subordinated
certificate will be outstanding longer than would be the case if principal were
distributed on a proportionate basis among the Class A Certificates and the
subordinated certificates. Because your subordinated certificate is outstanding
longer, there is a greater period of time during which losses on the mortgage
loans in the related loan group will affect your subordinated certificate.
Therefore the risk that you will lose all or part of the money you paid for the
certificate also increases.

     You should consider the risk that the subordination of the related
subordinated classes may not be sufficient to protect your certificates from
loss.

EXCESS INTEREST FROM THE MORTGAGE LOANS MAY NOT PROVIDE ADEQUATE CREDIT
ENHANCEMENT

     Each group of mortgage loans is expected to generate more interest than is
needed to pay interest on the related classes of certificates because the
weighted average interest rate on those mortgage loans is expected to be higher
than the weighted average pass-through rate on the related classes of
certificates. If the amount of interest generated by a group of mortgage loans
is more than the amount that is needed to pay interest on the related
certificates, some of such "excess interest" will be used to make additional
principal payments on the related certificates, some will be used to pay
interest on the related certificates that was previously earned but not paid,
and some will be used to reimburse the related subordinated certificates for
losses that they experienced previously. The use of excess interest to make
additional principal payments on the related certificates will reduce the total
principal balance of those certificates below the aggregate principal balance of
the related mortgage loans, thereby creating "overcollateralization."
Overcollateralization is intended to provide limited protection to
certificateholders by absorbing the related certificates' share of losses from
liquidated mortgage loans in the applicable loan group.

     However, we cannot assure you that enough excess interest will be generated
on the mortgage loans of either loan group to establish or maintain the required
levels of overcollateralization for the related certificate group.

     The excess interest available on any distribution date will be affected by
the actual amount of interest received, collected or advanced in respect of the
related mortgage loans during the preceding month. Such amount will be
influenced by changes in the pass-through rates on the group 2 certificates and
changes to the weighted average of the mortgage rates resulting from prepayments
and liquidations of the related mortgage loans, and in the case of the group 2
certificates, adjustments of the mortgage rates on adjustable rate mortgage
loans. Because the index used to determine the mortgage rates on the adjustable
rate mortgage loans is different from the index used to determine the
pass-through rates on the group 2 certificates, it is possible that the
pass-through rates on these certificates may be higher than the interest rates
on the related mortgage loans. In that event, it may be necessary to apply all
or a portion of the available excess interest to make required payments of
interest on the related classes of certificates. As a result, excess interest
may be unavailable for any other purpose.

                                       2


     Investors in the offered certificates, and particularly the Class B
Certificates, should consider the risk that the overcollateralization may not be
sufficient to protect your certificates from loss. Excess interest and
overcollateralization are the only forms of credit enhancement for the Class B
Certificates.

RISK REGARDING MORTGAGE RATES

     The pass-through rate on each class of group 2 certificates adjusts monthly
and is generally based on one-month LIBOR. The mortgage rates on the adjustable
rate mortgage loans generally adjust semi-annually and, in the case of
approximately % of the group 2 statistical calculation initial mortgage loans,
only after a two, three or five year period after origination, based on
six-month LIBOR or CMT (called the Loan Index). Because the Loan Index may
respond to different economic and market factors than one-month LIBOR, there is
not necessarily a correlation in movement between such indices. For example, it
is possible that the interest rates on certain of the adjustable rate mortgage
loans may decline while the pass-through rates on the related certificates are
stable or rising. In addition, although it is possible that both the mortgage
rates and certificate pass-through rates may decline or increase during the same
period, because of the difference between interest rate adjustment periods and
pass-through rate adjustment periods, mortgage rates may decline or increase
more slowly than the related certificate pass-through rates.

     This absence of a correlation between movement in the mortgage rates and
the certificate pass-through rates may reduce the interest payable on the group
2 certificates because of the imposition of a pass-through rate cap called the
"Group 2 WAC Cap." Although it is intended that the amount by which a
certificateholder's interest payment has been reduced by operation of the Group
2 WAC Cap will be paid to such certificateholder from excess funds on future
distribution dates, we cannot assure you that excess funds will be available or
sufficient to make any such payments. The ratings assigned to the group 2
certificates do not address the likelihood that these payments will be made.

     In addition, the pass-through rate for each class of fixed-rate
certificates will be subject to the imposition of a pass-through rate cap equal
to the weighted average of the net mortgage rates on the fixed-rate mortgage
loans called the Group 1 WAC Cap. Unlike the holder of a group 2 certificate, a
holder of a group 1 certificate whose interest payment has been reduced by
operation of the Group 1 WAC Cap on any distribution date will not be entitled
to receive the amount of such reduction from the excess funds on any future
distribution date.

RISK REGARDING MORTGAGE LOANS WITH BALLOON PAYMENTS

     [Approximately [ ]% and [ ]% of the statistical calculation initial
mortgage loans in loan group 1 and loan group 2, respectively, by principal
balance as of [   ], 200[ ], are balloon loans. Balloon loans pose a special
payment risk because the mortgagor must pay, and the servicer is not obligated
to advance, a lump sum payment of principal at the end of the loan term. If the
mortgagor is unable to pay the lump sum or refinance the balloon balance, you
may suffer a loss if the collateral for the loan is insufficient and the other
forms of credit enhancement are insufficient or unavailable to cover the loss.

                                       3


CASH FLOW CONSIDERATIONS AND RISKS COULD CAUSE PAYMENT DELAYS AND LOSSES

     Substantial delays could result while liquidating delinquent mortgage
loans. Further, liquidation expenses (such as legal fees, real estate taxes, and
maintenance and preservation expenses) will reduce the security for the related
mortgage loans and in turn reduce the proceeds payable to certificateholders. In
the event any of the mortgaged properties fail to provide adequate security for
the related mortgage loans, and the credit enhancement is insufficient, you
could experience a loss.

UNPREDICTABILITY AND EFFECT OF PREPAYMENTS

     A majority of the borrowers under the statistical calculation initial
mortgage loans generally cannot prepay their mortgage loans during the first
one, two, three, four or five years after origination without incurring
prepayment penalties. However, we cannot predict the rate at which borrowers
will repay their mortgage loans. A prepayment of a mortgage loan will result in
a prepayment on the certificates.

     o If you purchase your certificates at a discount and principal is repaid
slower than you anticipate, then your yield may be lower than you anticipate.

     o If you purchase your certificates at a premium and principal is repaid
faster than you anticipate, then your yield may be lower than you anticipate.

     In addition, the weighted average life of the certificates will be affected
by any prepayment resulting from the distribution of amounts, if any, on deposit
in the pre-funding accounts after the end of the pre-funding period.

     None of the prepayment penalties will be distributed to holders of the
offered certificates.

     In addition, prepayments on fixed-rate mortgage loans with interest rates
in excess of the Group 1 WAC Cap can have the effect of reducing the Group 1 WAC
Cap, and prepayments on adjustable-rate mortgage loans with interest rates in
excess of the Group 2 WAC Cap can have the effect of reducing the Group 2 WAC
Cap. In the event that either the Group 1 WAC Cap or the Group 2 WAC Cap is in
effect on any distribution date, the reduction of the Group 1 WAC Cap or the
Group 2 WAC Cap will have the effect of reducing the pass-through rates paid to
the related certificateholders on such distribution day.

     See "Yield, Prepayment and Maturity Considerations" for a description of
factors that may influence the rate and timing of prepayments on the mortgage
loans.

POSSIBLE PREPAYMENT DUE TO INABILITY TO ACQUIRE RELATED SUBSEQUENT MORTGAGE
LOANS

     The ability of the trust fund to acquire subsequent mortgage loans for
inclusion in the related loan group depends on the ability of the seller to
originate and acquire mortgage loans during the pre-funding period that meet the
eligibility criteria for subsequent mortgage loans as described in this
prospectus supplement. The ability of the seller to originate and acquire
subsequent mortgage loans will be affected by a number of factors including
prevailing interest rates, employment levels, the rate of inflation and economic
conditions generally.


                                       4


     If the full amounts on deposit in the pre-funding account allocated to
purchase subsequent mortgage loans for a loan group cannot be used by the end of
the pre-funding period for that purpose, the amounts remaining on deposit in
that pre-funding account will be distributed to the holders of the related Class
A certificates as a prepayment on the [ ] 200[ ] distribution date.

JUNIOR LIEN PRIORITY COULD RESULT IN PAYMENT DELAY OR LOSS

     Approximately [ ]% of the statistical calculation initial mortgage loans in
loan group 1 (by principal balance as of [ ], 200[ ]) are secured by second
liens on mortgaged properties. The master servicer has the power under certain
circumstances to consent to a new mortgage lien on the mortgaged property having
priority over the mortgage loan in the trust fund. Mortgage loans secured by
second mortgages are entitled to proceeds that remain from the sale of the
related mortgaged property after any related senior mortgage loan and prior
statutory liens have been satisfied. In the event that the remaining proceeds
are insufficient to satisfy the mortgage loans secured by second mortgages and
prior liens in the aggregate and the credit enhancement is insufficient, you
will bear the risk of delay in distributions while any deficiency judgment
against the borrower is sought and the risk of loss if the deficiency judgment
cannot be obtained or is not realized upon.

     See "Certain Legal Aspects of the Loans" in the prospectus.

INSOLVENCY MAY AFFECT THE TIMING AND AMOUNT OF DISTRIBUTIONS ON THE CERTIFICATES

     The transfer of the mortgage loans by the seller to the depositor will be
characterized in the pooling and servicing agreement as a sale transaction.
Nevertheless, in the event of insolvency of the seller, the Federal Deposit
Insurance Corporation (referred to as the FDIC) as conservator or receiver,
could attempt to recharacterize the sale of the mortgage loans to the depositor
as a borrowing secured by a pledge of the mortgage loans. If such an attempt to
recharacterize the transfer of the mortgage loans were successful, the FDIC
could elect to accelerate payment of the certificates and liquidate the mortgage
loans, with the holders of the certificates entitled to no more than the
outstanding principal balances, if any, of the classes of certificates, together
with interest thereon at the applicable pass-through rates. In the event of an
acceleration of the certificates, the holders of the certificates would lose the
right to future payments of interest, might suffer reinvestment losses in a
lower interest rate environment and may fail to recover their initial
investment. Further, with respect to an acceleration by the FDIC, interest may
be payable only through the date of appointment of the FDIC as conservator or
receiver. The FDIC has a reasonable period of time (which it has stated will
generally not exceed 180 days after the date of its appointment) to elect to
accelerate payment. Whether or not an acceleration takes place, delays in
payments on the certificates and possible reductions in the amount of such
payments could occur.

DEVELOPMENTS IN [CALIFORNIA] COULD HAVE DISPROPORTIONATE EFFECT ON THE POOL OF
MORTGAGE LOANS DUE TO GEOGRAPHIC CONCENTRATION OF MORTGAGED PROPERTIES

     Approximately [ ]% of the statistical calculation initial mortgage loans,
based on principal balances as of [   ], 200[ ], expected to be in the trust
fund on the closing date are


                                       5


secured by property in [California]. Property in [California] may be more
susceptible than homes located in other parts of the country to certain types of
uninsurable hazards, such as earthquakes, floods, mudslides and other natural
disasters.

In addition:

     o Economic conditions in California (which may or may not affect real
property values) may affect the ability of borrowers to repay their loans on
time;

     o Declines in the California residential real estate market may reduce the
values of properties located in California, which would result in an increase in
the loan-to-value ratios; and

     o Any increase in the market value of properties located in California
would reduce the loan-to-value ratios and could, therefore, make alternative
sources of financing available to the borrowers at lower interest rates, which
could result in an increased rate of prepayment of the mortgage loans.

CERTIFICATES MAY NOT BE APPROPRIATE FOR CERTAIN INVESTORS

     The offered certificates may not be an appropriate investment for investors
who do not have sufficient resources or expertise to evaluate the particular
characteristics of the applicable class of offered certificates. This may be the
case because, among other things:

     o The yield to maturity of offered certificates purchased at a price other
than par will be sensitive to the uncertain rate and timing of principal
prepayments on the related mortgage loans;

     o The rate of principal distributions on and the weighted average lives of
the offered certificates will be sensitive to the uncertain rate and timing of
principal prepayments on the related mortgage loans and the priority of
principal distributions among the classes of certificates. Accordingly, the
offered certificates may be an inappropriate investment if you require a
distribution of a particular amount of principal on a specific date or an
otherwise predictable stream of distributions;

     o You may not be able to reinvest amounts distributed in respect of
principal on an offered certificate (which, in general, are expected to be
greater during periods of relatively low interest rates) at a rate at least as
high as the pass-through rate applicable to your certificate; or

     o A secondary market for the offered certificates may not develop or
provide certificateholders with liquidity of investment.

     You should also carefully consider the further risks discussed above and
under the heading "Yield, Prepayment and Maturity Considerations" in this
prospectus supplement and under the heading "Risk Factors" in the prospectus.

CERTIFICATES ARE OBLIGATIONS OF ONLY THE TRUST FUND

     The offered certificates will not represent an ownership interest in or
obligation of any entity except for the obligations of the depositor and of the
seller pursuant to certain limited representations and warranties made with
respect to the mortgage loans and of the master servicer with respect to its
servicing obligations under the pooling and servicing agreement


                                       6


(including the limited obligation to make certain monthly advances). Neither the
certificates nor the underlying mortgage loans will be guaranteed or insured by
any governmental agency or instrumentality. The offered certificates are not
bank accounts and are not insured by the FDIC. Proceeds of the assets included
in the trust fund (including the mortgage loans) [and proceeds from the
borrower-paid mortgage insurance policies] will be the sole source of payments
on the offered certificates. You will not be able to receive money from any
entity in the event that such proceeds are not enough to make all payments
provided for under the offered certificates.

     For a discussion of additional risks pertaining to the certificates, see
"Risk Factors" in the prospectus.

IMPACT OF WORLD EVENTS

     The economic impact of the United States' military operations in Iraq, as
well as the possibility of any terrorist attacks in response to these
operations, is uncertain, but could have a material effect on general economic
conditions, consumer confidence, and market liquidity. No assurance can be given
as to the effect of these events on consumer confidence and the performance of
the mortgage loans. Any adverse impact to the mortgage loans resulting from
these events would be borne by the holders of the certificates. United States
military operations may also increase the likelihood of shortfalls under the
Relief Act.

CERTAIN MORTGAGE LOANS HAVE HIGH LOAN-TO-VALUE RATIOS WHICH MAY PRESENT A
GREATER RISK OF LOSS RELATING TO SUCH MORTGAGE LOANS

     Mortgage loans with a loan-to-value or combined loan-to-value ratio of
greater than 80% may present a greater risk of loss than mortgage loans with
loan-to-value or combined loan-to-value ratios of 80% or below. Of the
statistical calculation mortgage loans in loan group 1 and loan group 2 that had
a loan-to-value (in the case of the first lien Mortgage Loans) or combined
loan-to-value ratio (in the case of the second lien Mortgage Loans) at
origination in excess of 80%, approximately [ ]% and [ ]% of the statistical
calculation mortgage loans in loan group 1 and loan group 2, respectively, are
not covered by any primary mortgage insurance. No mortgage loan conveyed to the
trust fund will have had a loan-to-value or combined loan-to-value ratio
exceeding 100.00% at origination. An overall decline in the residential real
estate market, a rise in interest rates over a period of time and the general
condition of a mortgaged property, as well as other factors, may have the effect
of reducing the value of such mortgaged property from the appraised value at the
time the mortgage loan was originated. If there is a reduction in value of the
mortgaged property, the loan-to-value or combined loan-to-value ratio may
increase over what it was at the time of origination. Such an increase may
reduce the likelihood of liquidation or other proceeds being sufficient to
satisfy the mortgage loan. There can be no assurance that the loan-to-value
ratio of any mortgage loan determined at any time after origination is less than
or equal to its original loan-to-value or combined loan-to-value ratio. See "The
Mortgage Pool--General" in this prospectus supplement.

INCREASED RISK OF LOSS DUE TO SIMULTANEOUS SECOND LIENS

     With respect to certain first lien mortgage loans included in each loan
group, at the time of origination of the first lien mortgage loan, the seller
also originated a second lien mortgage


                                       7


loan which will not be included in the trust fund. With respect to such mortgage
loans, foreclosure frequency may be increased relative to mortgage loans that
were originated without a simultaneous second lien because mortgagors have less
equity in the mortgaged property. In addition, the loan-to-value or combined
loan-to-value ratios shown in this prospectus supplement do not reflect those
simultaneous second lien loans. Investors should also note that any mortgagor
may obtain secondary financing at any time subsequent to the date of origination
of their mortgage loan from the seller or from any other lender.

VIOLATION OF VARIOUS FEDERAL AND STATE LAWS MAY RESULT IN LOSSES ON THE MORTGAGE
LOANS

Applicable state laws generally regulate interest rates and other charges,
require certain disclosure, and require licensing of the seller. In addition,
other state laws, public policy and general principles of equity relating to the
protection of consumers, unfair and deceptive practices and debt collection
practices may apply to the origination, servicing and collection of the mortgage
loans. The mortgage loans are also subject to federal laws, including:

     o    the Federal Truth-in-Lending Act and Regulation Z promulgated
          thereunder, which require certain disclosures to the borrowers
          regarding the terms of the mortgage loans;

     o    the Equal Credit Opportunity Act and Regulation B promulgated
          thereunder, which prohibit discrimination on the basis of age, race,
          color, sex, religion, marital status, national origin, receipt of
          public assistance or the exercise of any right under the Consumer
          Credit Protection Act, in the extension of credit;

     o    the Fair Credit Reporting Act, which regulates the use and reporting
          of information related to the borrower's credit experience;

     o    the Depository Institutions Deregulation and Monetary Control Act of
          1980, which preempts certain state usury laws; and

     o    the Alternative Mortgage Transaction Parity Act of 1982, which
          preempts certain state lending laws that regulate alternative mortgage
          transactions.

Violations of certain provisions of these federal and state laws may limit the
ability of the master servicer to collect all or part of the principal of or
interest on the mortgage loans and in addition could subject the trust to
damages and administrative enforcement. In particular, the seller's failure to
comply with certain requirements of the Federal Truth-in-Lending Act, as
implemented by Regulation Z, could subject the trust to monetary penalties, and
result in the borrowers' rescinding the mortgage loans against the trust fund.
In addition to federal law, some states have enacted, or may enact, laws or
regulations that prohibit inclusion of some provisions in mortgage loans that
have interest rates or origination costs in excess of prescribed levels, and
require that borrowers be given certain disclosures prior to the consummation of
the mortgage loans and restrict the master servicer's ability to foreclose in
response to the mortgagor's default. The seller's failure to comply with these
laws could subject the trust fund to significant monetary penalties, could
result in the borrowers rescinding the mortgage loans against the trust fund
and/or limit the master servicer's ability to foreclose upon the related
mortgaged property in the event of a mortgagor's default. See "Certain Legal
Aspects of the Loan--Anti-Deficiency


                                       8


Legislation and Other Limitations on Lenders" in the prospectus. The seller will
represent that as of the closing date, each mortgage loan is in compliance with
applicable federal and state laws and regulations. The seller will also
represent that none of the mortgage loans are subject to Section 32 of
Regulation Z and that none of the mortgagors have been required to purchase
single-premium credit life insurance in connection with the origination of the
related mortgage loan. In the event of a breach of such representation, the
seller will be obligated to cure such breach or repurchase or replace the
affected mortgage loan in the manner described in the prospectus. If the seller
is unable or otherwise fails to satisfy such obligations, the yield on the
offered certificates may be materially and adversely affected.

PREPAYMENT INTEREST SHORTFALLS AND RELIEF ACT SHORTFALLS

When a mortgage loan is prepaid, the mortgagor is charged interest on the amount
prepaid only up to (but not including) the date on which the prepayment is made,
rather than for an entire month. This may result in a shortfall in interest
collections available for distribution on the next distribution date. The Master
Servicer is required to cover a portion of the shortfall in interest collections
that are attributable to prepayments. In addition, certain shortfalls in
interest collections arising from the application of the Servicemembers Civil
Relief Act (referred to as the "Relief Act") will not be covered by the master
servicer.

On any distribution date, any prepayment interest shortfalls to the extent not
covered by compensating interest paid by the master servicer and any shortfalls
resulting from the application of the Relief Act will be allocated, to the
monthly interest distributable amounts with respect to the offered certificates
on a pro rata basis based on the respective amounts of interest accrued on such
certificates for such distribution date. The holders of the offered certificates
will not be entitled to reimbursement for any such interest shortfalls. If these
shortfalls are allocated to the offered certificates the amount of interest
distributed to those certificates will be reduced, adversely affecting the yield
on your investment.

ENVIRONMENTAL RISKS

Federal, state and local laws and regulations impose a wide range of
requirements on activities that may affect the environment, health and safety.
In certain circumstances, these laws and regulations impose obligations on
owners or operators of residential properties such as those that secure the
mortgage loans. Failure to comply with these laws and regulations can result in
fines and penalties that could be assessed against the trust fund as owner of
the related property.

In some states, a lien on the property due to contamination has priority over
the lien of an existing mortgage. Further, a mortgage lender may be held liable
as an "owner" or "operator" for costs associated with the release of petroleum
from an underground storage tank under certain circumstances. If the trust fund
is considered the owner or operator of a property, it may suffer losses as a
result of any liability imposed for environmental hazards on the property.

                                THE MORTGAGE POOL

                                       9


GENERAL

     The depositor will purchase the mortgage loans from [IndyMac Bank, F.S.B.
(referred to as IndyMac Bank)] pursuant to a pooling and servicing agreement
dated as of [ ], 200[ ] among [IndyMac Bank], as seller and master servicer, the
depositor and the trustee or pursuant to the pooling and servicing agreement and
a subsequent transfer agreement dated as of the subsequent transfer date among
[IndyMac Bank], as seller and master servicer, the depositor and the trustee and
will cause the mortgage loans to be assigned to the trustee for the benefit of
holders of the certificates. The mortgage loans purchased pursuant to the
pooling and servicing agreement shall be designated "initial mortgage loans" and
the mortgage loans purchased pursuant to the pooling and servicing agreement and
a subsequent transfer agreement shall be designated "subsequent mortgage loans."

     Under the pooling and servicing agreement, the seller will make certain
representations, warranties and covenants to the depositor relating to, among
other things, the due execution and enforceability of the pooling and servicing
agreement and certain characteristics of the mortgage loans and, subject to the
limitations described below under "--Assignment of Mortgage Loans," will be
obligated to repurchase or substitute a similar mortgage loan for any mortgage
loan as to which there exists deficient documentation or an uncured breach of
any representation, warranty or covenant if the breach of representation,
warranty or covenant materially and adversely affects the interests of the
certificateholders in that mortgage loan; provided, however, that the seller
will not be obligated to make any repurchase or substitution (or cure any
breach) if the breach constitutes fraud in the origination of the affected
mortgage loan and the seller did not have knowledge of the fraud. The seller
will represent and warrant to the depositor in the pooling and servicing
agreement that the mortgage loans were selected from among the outstanding
one-to four-family mortgage loans in the seller's sub-prime mortgage portfolio
as to which the representations and warranties set forth in the pooling and
servicing agreement can be made and that the selection was not made in a manner
intended to adversely affect the interests of the certificateholders. See "Loan
Program--Representations by Sellers; Repurchases" in the prospectus. Under the
pooling and servicing agreement, the depositor will assign all its right, title
and interest in and to the representations, warranties and covenants (including
the seller's repurchase obligation) to the trustee for the benefit of the
certificateholders. The depositor will make no representations or warranties
with respect to the mortgage loans and will have no obligation to repurchase or
substitute mortgage loans with deficient documentation or which are otherwise
defective. [IndyMac Bank] is selling the mortgage loans without recourse and
will have no obligation with respect to the certificates in its capacity as
seller other than the repurchase or substitution obligations described above.
The obligations of [IndyMac Bank], as master servicer, with respect to the
certificates are limited to the master servicer's contractual servicing
obligations under the pooling and servicing agreement.

     Certain information with respect to the statistical calculation initial
mortgage loans to be included in the statistical calculation mortgage pool is
set forth below. Prior to the closing date, mortgage loans may be removed from
the mortgage pool and other mortgage loans may be substituted therefor. The
depositor believes that the information set forth in this prospectus supplement
with respect to the statistical calculation mortgage pool is representative of
the characteristics of the mortgage pool as it will be constituted at the
closing date, although certain characteristics of the mortgage loans in the
mortgage pool may vary. Unless otherwise indicated,


                                       10


information presented below expressed as a percentage (other than rates of
interest) are approximate percentages based on the Stated Principal Balances of
the statistical calculation initial mortgage loans as of the cut-off date.

     As of the cut-off date, the aggregate of the Stated Principal Balances of
the statistical calculation initial mortgage loans is expected to be
approximately $[ ], which is referred to as the statistical calculation cut-off
date principal balance. The initial mortgage loans provide for the amortization
of the amount financed over a series of substantially equal monthly payments.
The initial mortgage loans to be included in the mortgage pool were acquired by
the seller in the normal course of its business.

     At origination, substantially all of the statistical calculation initial
mortgage loans had stated terms to maturity of 30 years. Each of the statistical
calculation initial mortgage loans provides for payments due on the first day of
each month (referred to as a "Due Date"). Scheduled monthly payments made by the
mortgagors on the statistical calculation initial mortgage loans (referred to as
scheduled payments) either earlier or later than the scheduled Due Dates thereof
will not affect the amortization schedule or the relative application of those
payments to principal and interest.

     Of the statistical calculation initial mortgage loans, [ ]mortgage loans in
loan group 1, representing approximately [ ]% of the cut-off date principal
balance of the statistical calculation initial mortgage loans in loan group 1,
and [ ]mortgage loans in loan group 2, representing approximately [ ]% of the
cut-off date principal balance of the statistical calculation initial mortgage
loans in loan group 2, contain prepayment penalties. Prepayment penalties
provide that if the borrower were to prepay the mortgage loan in full at any
time from the origination of the mortgage loan to a date set forth in the
related mortgage note (referred to as the Prepayment Penalty Period), the
borrower would also have to pay a fee in addition to the amount necessary to
repay the mortgage loan. The Prepayment Penalty Period for the statistical
calculation initial mortgage loans vary from 1 year to 5 years, depending on the
terms set forth in the related mortgage note. The amount of the prepayment
penalty varies from state to state.

     With respect to the statistical calculation initial mortgage loans in loan
group 2, each mortgage loan has a mortgage rate subject to adjustment on the Due
Date specified in the related mortgage note (referred to as the Initial Rate
Adjustment Date) and every six months (in the case of [ ] Adjustable Mortgage
Loans and[ ]Adjustable Mortgage Loans (each as defined below)) and one year (in
the case of [ ]Adjustable Mortgage Loans and [ ]Adjustable Mortgage Loans (each
as defined below)) thereafter (referred to as an Adjustment Date), equal to (a)
in the case of [ ] Adjustable Mortgage Loans and [ ]Adjustable Mortgage Loans,
the sum, rounded to the nearest one-eighth of one percentage point (0.125%), of
(i) the average of interbank offered rates for six month U.S. dollar deposits in
the London market (referred to as the Index) based on quotations of major banks,
as published either (x) by Fannie Mae either 30 or 45 days prior to the
Adjustment Date or (y) in the "Money Rates" section of The Wall Street Journal
as of the first business day of the month prior to the Adjustment Date, as
specified in the related mortgage note, and (ii) the margin specified in the
related mortgage note and (b) in the case of the [ ] Adjustable Mortgage Loans,
the weekly average yield on U.S. Treasury Securities adjusted to a constant
maturity of one year as made available by the Federal Reserve, in each case as
specified in the related mortgage note; provided, however, that the mortgage
rate will not increase or


                                       11


decrease on any Adjustment Date by more than (A) with respect to [ ]statistical
calculation initial mortgage loans (representing approximately [ ]% of the
statistical calculation cut-off date principal balance of loan group 2), one
percentage point (1%), (B) with respect to [ ]statistical calculation initial
mortgage loans (representing approximately [ ]% of the statistical calculation
cut-off date principal balance of loan group 2), one and one-half percentage
points (1.5%), (C) with respect to [ ] statistical calculation initial mortgage
loans (representing approximately % of the statistical calculation cut-off date
principal balance of loan group 2), two percentage points (2.0%), (D) with
respect [ ] statistical calculation initial mortgage loans (representing
approximately [ ] % of the statistical calculation cut-off date principal
balance of loan group 2), three percentage points (3%), (E) with respect to [ ]
statistical calculation initial mortgage loans (representing approximately 0.25%
of the statistical calculation cut-off date principal balance of loan group 2),
five percentage points (5%) and (F) with respect to statistical calculation
initial mortgage loans (representing approximately [ ] % of the cut-off date
principal balance of loan group 2), seven percentage points or greater (7%)
(referred to as the Periodic Rate Cap). Approximately [ ] % of the statistical
calculation initial mortgage loans in loan group 2 (by statistical calculation
cut-off date principal balance) have an Initial Rate Adjustment Date occurring
on the Due Date following the second anniversary of the date of origination
(referred to as _______ Adjustable Mortgage Loans). Approximately [ ] % of the
statistical calculation initial mortgage loans in loan group 2 have an Initial
Rate Adjustment Date occurring on the sixth Due Date following the related date
of origination (referred to as [ ] Adjustable Mortgage Loans). Approximately [ ]
% of the statistical calculation initial mortgage loans in loan group 2 (by
statistical calculation cut-off date principal balance) have an Initial Rate
Adjustment Date occurring on the Due Date following the third anniversary of the
date of origination (referred to as [ ] Adjustable Mortgage Loans).

     With respect to the statistical calculation initial mortgage loans in loan
group 2, statistical calculation initial mortgage loans (representing
approximately [ ] % of the statistical calculation cut-off date principal
balance of loan group 2) are subject to an initial rate cap of 1%, [ ]
statistical calculation initial mortgage loans (representing approximately % of
the statistical calculation cut-off date principal balance of loan group 2) are
subject to an initial rate cap of 3% and [ ] statistical calculation initial
mortgage loans (representing approximately [ ] % of the statistical calculation
cut-off date principal balance of loan group 2) are subject to an initial rate
cap of 5%.

     The [ ] Adjustable Mortgage Loans will include "performance loans"
(referred to as Performance Loans) that provide borrowers the potential of a
margin reduction for good payment history. The payment history for the
Performance Loan is evaluated in the second month preceding the month in which
the Initial Rate Adjustment Date occurs. If the related borrower has made
scheduled payments in full since the origination of that loan with a maximum of
one late payment (which, however, cannot be in the month of evaluation) the loan
is eligible for a reduction (ranging from [ ] % to [ ] %) in the margin used to
calculate the mortgage rate. Approximately [ ] % of the mortgage loans in loan
group 2 are Performance Loans.

     All of the statistical calculation initial mortgage loans in loan group 2
provide that over the life of the mortgage loan the mortgage rate will in no
event be more than the mortgage rate fixed at origination plus a fixed number of
percentage points specified in the related mortgage


                                       12


note (referred to as the Maximum Rate). The statistical calculation initial
mortgage loans in loan group 2 are generally not subject to minimum mortgage
rates. Effective with the first payment due on a statistical calculation initial
mortgage loan in loan group 2 after each related Adjustment Date, the scheduled
payment will be adjusted to an amount which will pay interest at the adjusted
rate and fully amortize the then-outstanding principal balance of the mortgage
loan in loan group 2 over its remaining term. If the applicable Loan Index
ceases to be published or is otherwise unavailable, the master servicer will
select an alternative index based upon comparable information.

     Each statistical calculation initial mortgage loan in loan group 2 is, by
its terms, assumable in connection with a transfer of the related mortgaged
property if the proposed transferee submits certain information to the master
servicer required to enable it to evaluate the transferee's ability to repay
that mortgage loan and if the master servicer reasonably determines that the
security for that mortgage loan would not be impaired by the assumption. The
statistical calculation initial mortgage loans in loan group 1 are subject to
the "due-on-sale" provisions included therein.

     All of the statistical calculation initial mortgage loans in loan group 1
were originated on or after [ ] . All of the statistical calculation initial
mortgage loans in loan group 2 were originated on or after            .

     The latest stated maturity date of any statistical calculation initial
mortgage loan in loan group 1 is [ ] . The earliest stated maturity date of any
statistical calculation initial mortgage loan in loan group 1 is [ ] . The
latest stated maturity date of any statistical calculation initial mortgage loan
in loan group 2 is [ ] . The earliest stated maturity date of any statistical
calculation initial mortgage loan in loan group 2 is            .

     As of the cut-off date, [ ] % of the statistical calculation initial
mortgage loans in loan group 1 and [ ] % of the statistical calculation initial
mortgage loans in loan group 2 were delinquent more than 30 days.

     With respect to [ ] statistical calculation initial mortgage loans
(representing approximately [ ] % of the statistical calculation cut-off date
principal balance of the statistical calculation initial mortgage loans in loan
group 1) the lender (rather than the borrower) acquired the primary mortgage
guaranty insurance and charged the related borrower an interest premium.

     With respect to [ ] statistical calculation initial mortgage loans
(representing approximately [ ] % of the statistical calculation cut-off date
principal balance of the statistical calculation initial mortgage loans in loan
group 2) the lender (rather than the borrower) acquired the primary mortgage
guaranty insurance and charged the related borrower an interest premium.

     [None] of the statistical calculation initial mortgage loans in either of
the loan groups were originated in connection with the relocation of employees
of various corporate employers. None of the statistical calculation initial
mortgage loans in loan group 2 are convertible into fixed-rate mortgage loans.

                                       13


     Of the statistical calculation initial mortgage loans in loan group 1, [ ]
mortgage loans (representing approximately [ ] % of the statistical calculation
cut-off date principal balance of the initial mortgage loans in loan group 1)
are secured by first liens on the related mortgaged properties, and [ ] mortgage
loans in loan group 1 (representing approximately % of the statistical
calculation cut-off date principal balance of the statistical calculation
initial mortgage loans in loan group 1) are secured by second liens on the
related mortgaged properties. All of the statistical calculation initial
mortgage loans in loan group 2 are secured by first liens on the related
mortgaged properties.

     [No] statistical calculation initial mortgage loans in loan group 1 had a
Loan-to-Value Ratio or Combined Loan-to-Value Ratio (as applicable) at
origination of more than 95%. No statistical calculation initial mortgage loan
in loan group 2 had a Loan-to-Value Ratio at origination of more than 95%.
Except for [ ] statistical calculation initial mortgage loans in loan group 1,
representing approximately [ ] % of the statistical calculation cut-off date
principal balance of the statistical calculation initial mortgage loans in loan
group 1, and except for [ ] statistical calculation initial mortgage loans in
loan group 2, representing approximately [ ] % of the statistical calculation
cut-off date principal balance of the mortgage loans in loan group 2, each
statistical calculation initial mortgage loan with a Loan-to-Value Ratio or
Combined Loan-to-Value Ratio (as applicable) at origination of greater than 80%
will be covered by a primary mortgage guaranty insurance policy issued by a
mortgage insurance company acceptable to Fannie Mae, Freddie Mac or any
nationally recognized statistical rating organization, which policy provides
coverage of a portion of the original principal balance of the related mortgage
loan equal to the product of the original principal balance thereof and a
fraction, the numerator of which is the excess of the original principal balance
of the related mortgage loan over 75% of the lesser of the appraised value and
selling price of the related mortgaged property and the denominator of which is
the original principal balance of the related mortgage loan, plus accrued
interest thereon and related foreclosure expenses. No primary mortgage guaranty
insurance policy will be required with respect to any mortgage loan (i) after
the date on which the related Loan-to-Value Ratio or Combined Loan-to-Value
Ratio (as applicable) is 80% or less or, based on a new appraisal, the principal
balance of that mortgage loan represents 80% or less of the new appraised value
or (ii) if maintaining the policy is prohibited by applicable law. See
"--Underwriting Standards" in this prospectus supplement.

     The "Loan-to-Value Ratio" of a mortgage loan at any given time is the
fraction, expressed as a percentage, the numerator of which is the original
principal balance of the related mortgage loan and the denominator of which is
the Collateral Value of the related mortgaged property. The "Combined
Loan-to-Value Ratio" of a mortgage loan at any given time is the ratio,
expressed as a percentage, of (i) the sum of (a) the original principal balance
of the mortgage loan and (b) the outstanding principal balance at the date of
origination of the mortgage loan of any senior mortgage loans(s) or, in the case
of any open-ended senior mortgage loan, the maximum available line of credit
with respect to that mortgage loan at origination, regardless of any lesser
amount actually outstanding at the date of origination of the mortgage loan, to
(ii) the Collateral Value of the related mortgaged property. The "Collateral
Value" of the mortgaged property, other than with respect to certain mortgage
loans the proceeds of which were used to refinance an existing mortgage loan
(referred to as a Refinance Loan), is the lesser of (a) the appraised value
determined in an appraisal obtained by the originator at origination of that


                                       14


mortgage loan and (b) the sales price for the mortgaged property. In the case of
Refinance Loans, the Collateral Value of the related mortgaged property is
generally the appraised value thereof determined in an appraisal obtained at the
time of refinancing. No assurance can be given that the value of any mortgaged
property has remained or will remain at the level that existed on the appraisal
or sales date. If residential real estate values generally or in a particular
geographic area decline, the Loan-to-Value Ratios or Combined Loan-to-Value
Ratios (as applicable) might not be a reliable indicator of the rates of
delinquencies, foreclosures and losses that could occur with respect to those
mortgage loans.

     "FICO Credit Scores" are obtained by many mortgage lenders in connection
with mortgage loan applications to help access a borrower's credit-worthiness.
FICO Credit Scores are generated by models developed by a third party which
analyze data on consumers in order to establish patterns which are believed to
be indicative of the borrower's probability of default. The FICO Credit Score is
based on a borrower's historical credit data, including, among other things,
payment history, delinquencies on accounts, levels of outstanding indebtedness,
length of credit history, types of credit, and bankruptcy experience. FICO
Credit Scores range from approximately 250 to approximately 900, with higher
scores indicating an individual with a more favorable credit history compared to
an individual with a lower score. However, a FICO Credit Score purports only to
be a measurement of the relative degree of risk a borrower represents to a
lender, i.e., that a borrower with a higher score is statistically expected to
be less likely to default in payment than a borrower with a lower score. In
addition, it should be noted that FICO Credit Scores were developed to indicate
a level of default probability over a two-year period which does not correspond
to the life of a mortgage loan. Furthermore, FICO Credit Scores were not
developed specifically for use in connection with mortgage loans, but for
consumer loans in general. Therefore, a FICO Credit Score does not take into
consideration the effect of mortgage loan characteristics (which may differ from
consumer loan characteristics) on the probability of repayment by the borrower.
We cannot assure you that a FICO Credit Score will be an accurate predictor of
the likely risk or quality of the related mortgage loan.

     The following information sets forth in tabular format certain information,
as of the cut-off date, as to the statistical calculation initial mortgage loans
in each loan group. Other than with respect to rates of interest, percentages
(approximate) are stated by Stated Principal Balance of the mortgage loans in
the related loan group as of the cut-off date and the sum of the columns below
may not equal the total indicated due to rounding.

     ***


                                       15



                      STATISTICAL CALCULATION LOAN GROUP 1

                    ORIGINAL COMBINED LOAN-TO-VALUE RATIOS(1)


   ORIGINAL LOAN-TO-VALUE                           AGGREGATE         PERCENT OF
     RATIOS OR COMBINED         NUMBER OF           PRINCIPAL          AGGREGATE
    LOAN-TO-VALUE RATIOS         MORTGAGE            BALANCE           PRINCIPAL
     (AS APPLICABLE)(%)           LOANS            OUTSTANDING          BALANCE
     ------------------           -----            -----------          -------

        10.00 -60.00                               $                          %
        60.01 -65.00
        60.01 -70.00
        70.01 -75.00
        75.01 -80.00
        80.01 -85.00
        85.01 -90.00
        90.01 -95.00
                                ---------          -----------         --------
     Total                                         $                    100.00%
                                =========          ===========         ========

(1) The weighted average Original Combined Loan-to-Value Ratio of the
statistical calculation initial mortgage loans in loan group 1 is expected to be
approximately       %.


                          ORIGINAL TERMS TO MATURITY(1)

                                               AGGREGATE             PERCENT OF
       ORIGINAL TERM        NUMBER OF          PRINCIPAL              AGGREGATE
        TO MATURITY          MORTGAGE           BALANCE               PRINCIPAL
          (MONTHS)            LOANS           OUTSTANDING              BALANCE
          --------            -----           -----------              -------

         180 -180                             $                              %
         181 -240
         301 -360
                            ---------         -----------            ----------
     Total                                    $                        100.00%
                            =========         ===========            ==========


(1) The weighted average remaining term to maturity of the statistical
calculation initial mortgage loans in loan group 1 is expected to be
approximately     months.


                                       16




                                MORTGAGE RATES(1)

                                          AGGREGATE              PERCENT OF
                       NUMBER OF          PRINCIPAL              AGGREGATE
     MORTGAGE           MORTGAGE           BALANCE               PRINCIPAL
    RATES (%)            LOANS           OUTSTANDING              BALANCE
    ---------            -----           -----------              -------

    7.750-7.750                          $                              %
    7.751-8.000
    8.001-8.250
    8.251-8.500
    8.501-8.750
    8.751-9.000
    9.001-9.250
    9.251-9.500
    9.501-9.750
    9.751-10.000
   10.001-10.250
   10.251-10.500
   10.501-10.750
   10.751-11.000
   11.001-11.250
   11.251-11.500
   11.501-11.750
   11.751-12.000
   12.001-12.250
   12.251-12.500
   12.501-12.750
   12.751-13.000
   13.001-13.250
   13.251-13.500
   13.501-13.750
   13.751-14.000
   14.001-14.250
   14.251-14.500
   14.501-14.750
                       ---------         -----------             ----------
Total                                    $                           100%
                       =========         ===========             ==========

(1) The statistical calculation initial mortgage loans in loan group 1 with
lender acquired mortgage insurance are shown in the preceding table at mortgage
rates inclusive of the interest premium charged by the related lenders. As of
the cut-off date, the weighted average mortgage rate of the statistical
calculation initial mortgage loans in loan group 1 without adjusting for the
interest premium is expected to be approximately     %. If the mortgage rates
for the lender acquired mortgage insurance loans are shown net of the interest
premium charged by the related lenders, the weighted average mortgage rate of
the statistical calculation initial mortgage loans in loan group 1 is expected
to be approximately      %.


                                       17


                   CURRENT MORTGAGE LOAN PRINCIPAL BALANCE(1)



                                                     AGGREGATE      PERCENT OF
             RANGE OF CURRENT         NUMBER OF      PRINCIPAL      AGGREGATE
              MORTGAGE LOAN            MORTGAGE       BALANCE       PRINCIPAL
            PRINCIPAL BALANCE           LOANS       OUTSTANDING      BALANCE
            -----------------           -----       -----------      -------

         $8,800.00 to  50,000.00                      $                     %
        $50,000.01 to 100,000.00
       $100,000.01 to 150,000.00
       $150,000.01 to 200,000.00
       $200,000.01 to 250,000.00
       $250,000.01 to 300,000.00
       $300,000.01 to 350,000.00
       $350,000.01 to 400,000.00
       $400,000.01 to 450,000.00
       $450,000.01 to 500,000.00
       $550,000.01 to 559,416.18
                                       -------        -------        -------
          Total                                       $                  100%
                                       =======        =======        =======


(1)  The average current principal balance of the statistical calculation
initial mortgage loans in loan group 1 is expected to be approximately $      .

                               OCCUPANCY TYPES(1)


                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                OCCUPANCY              MORTGAGE       BALANCE       PRINCIPAL
                  TYPE                  LOANS       OUTSTANDING      BALANCE
                  ----                  -----       -----------      -------

     Primary Home                                     $                     %
     Investor
     Second Home
                                       -------        -------        -------
     Total                                            $               100.00%
                                       =======        =======        =======
    

(1)  Based upon representations of the related mortgagors at the time of
origination.


                                       18


                   STATE DISTRIBUTION OF MORTGAGED PROPERTIES



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
           STATE OR TERRITORY           LOANS       OUTSTANDING      BALANCE
           ------------------           -----       -----------      -------

     California                                     $                      %
     New York
     Florida
     New Jersey
     Texas
     North Carolina
     Colorado
     South Carolina
     Connecticut
     Georgia
     Michigan
     Washington
     Virginia
     Tennessee
     Pennsylvania
     Maryland
     Arizona
     Oklahoma
     Nevada
     Oregon
     Illinois
     Wisconsin
     Massachusetts
     Missouri
     Idaho
     Ohio
     New Hampshire
     Minnesota
     Indiana
     Alaska
     District of Columbia
     Hawaii
     Kentucky
     Arkansas
     Montana
     Utah
     Iowa
     New Mexico
     Maine
     Vermont
     Kansas
     Louisiana
     Nebraska
     Mississippi
     Delaware
     West Virginia




                                       19


                   STATE DISTRIBUTION OF MORTGAGED PROPERTIES



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
           STATE OR TERRITORY           LOANS       OUTSTANDING      BALANCE
           ------------------           -----       -----------      -------

               Wyoming
                                       -------        -------        -------
               Total                                  $               100.00%
                                       =======        =======        =======


                            PURPOSE OF MORTGAGE LOANS


                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
              LOAN PURPOSE              LOANS       OUTSTANDING      BALANCE
              ------------              -----       -----------      -------

     Purchase                                         $                     %
     Refinance (Cash Out)
     Refinance (Rate or Term)
                                       -------        -------        -------
     Total                                            $               100.00%
                                       =======        =======        =======


                  DOCUMENTATION PROGRAMS FOR MORTGAGE LOANS(1)



                                                     AGGREGATE      PERCENT OF
                 TYPE OF              NUMBER OF      PRINCIPAL      AGGREGATE
              DOCUMENTATION            MORTGAGE       BALANCE       PRINCIPAL
                 PROGRAM                LOANS       OUTSTANDING      BALANCE
                 -------                -----       -----------      -------

         Full Documentation                           $                     %
         Reduced Documentation
         No Ratio
         No Documentation
                                       -------        -------        -------
         Total
                                                      $               100.00%
                                       =======        =======        =======
    


(1)  The Full, Reduced, No Ratio, and No Documentation Programs are described
under the heading "--Underwriting Standards."


                                       20


                           TYPE OF MORTGAGE PROPERTIES



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
              PROPERTY TYPE             LOANS       OUTSTANDING      BALANCE
              -------------             -----       -----------      -------

     Single Family Residence/D-PUD                    $                     %
     Manufactured Home(1)
     PUD
     Two Units
     Low Rise Condominium
     Three Units
     Cooperative
     Four Units
     Townhouse
     High Rise Condominium
                                       -------        -------        -------
     Total                                            $               100.00%
                                       =======        =======        =======


(1)  Treated as real property.


                      FICO CREDIT SCORES FOR MORTGAGE LOANS



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
            FICO CREDIT SCORE           LOANS       OUTSTANDING      BALANCE
            -----------------           -----       -----------      -------

     500-549                                          $                     %
     550-599
     600-649
     650-699
     700-749
     750-784
     Not Available
                                       -------        -------        -------
     Total                                            $               100.00%
                                       =======        =======        =======


                                       21


                       CREDIT LEVELS FOR MORTGAGE LOANS(1)



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
              CREDIT LEVEL              LOANS       OUTSTANDING      BALANCE
              ------------              -----       -----------      -------

     1                                                $                     %
     1+
     2
     3
     4
     Not Available
                                       -------        -------        -------
     Total                                            $               100.00%
                                       =======        =======        =======


(1)  Credit Levels are assigned as described under the heading "--Underwriting
Standards."


                      STATISTICAL CALCULATION LOAN GROUP 2

                        ORIGINAL LOAN-TO-VALUE RATIOS(1)



                                                     AGGREGATE      PERCENT OF
                ORIGINAL              NUMBER OF      PRINCIPAL      AGGREGATE
              LOAN-TO-VALUE            MORTGAGE       BALANCE       PRINCIPAL
               RATIOS (%)               LOANS       OUTSTANDING      BALANCE
               ----------               -----       -----------      -------

      8.79-60.00                                      $                     %
     60.01-65.00
     60.01-70.00
     70.01-75.00
     75.01-80.00
     80.01-85.00
     85.01-90.00
     90.01-95.00
                                       -------        -------        -------
     Total                                            $               100.00%
                                       =======        =======        =======


(1)  The weighted average Original Loan-to-Value Ratio of the statistical
calculation initial mortgage loans in loan group 2 is expected to be
approximately   %.


                                       22


                          ORIGINAL TERMS TO MATURITY(1)



                ORIGINAL                             AGGREGATE      PERCENT OF
                 TERM TO              NUMBER OF      PRINCIPAL      AGGREGATE
                MATURITY               MORTGAGE       BALANCE       PRINCIPAL
                (MONTHS)                LOANS       OUTSTANDING      BALANCE
                --------                -----       -----------      -------

     360-360                                          $               100.00%
                                       -------        -------        -------
     Total                                            $               100.00%
                                       =======        =======        =======


(1)  The weighted average remaining term to maturity of the statistical
calculation initial mortgage loans in loan group 2 is expected to be
approximately     months.


                            CURRENT MORTGAGE RATES(1)



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
        CURRENT MORTGAGE RATES(%)       LOANS       OUTSTANDING      BALANCE
        -------------------------       -----       -----------      -------

       8.000-8.000                                    $                     %
       8.001-8.250
       8.251-8.500
       8.501-8.750
       8.751-9.000
       9.001-9.250
       9.251-9.500
       9.501-9.750
      9.751-10.000
     10.001-10.250
     10.251-10.500
     10.501-10.750
     10.751-11.000
     11.001-11.250
     11.251-11.500
     11.501-11.750
     11.751-12.000
     12.001-12.250
     12.251-12.500
     12.501-12.750
     12.751-13.000
     13.001-13.250



                                       23


                            CURRENT MORTGAGE RATES(1)



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
        CURRENT MORTGAGE RATES(%)       LOANS       OUTSTANDING      BALANCE
        -------------------------       -----       -----------      -------

     13.251-13.500
     13.501-13.750
     13.751-14.000
                                       -------        -------        -------
             Total                                    $               100.00%
                                       =======        =======        =======


(1)  The statistical calculation initial mortgage loans in loan group 2 with
lender acquired mortgage insurance are shown in the preceding table at mortgage
rates inclusive of the interest premium charged by the related lenders. As of
the cut-off date, the weighted average mortgage rate of the statistical
calculation initial mortgage loans in loan group 2 without adjusting for the
interest premium is expected to be approximately    %. If the mortgage rates for
the lender acquired mortgage insurance loans are shown net of the interest
premium charged by the related lenders, the weighted average mortgage rate of
the statistical calculation initial mortgage loans in loan group 2 is expected
to be approximately    %.


                   CURRENT MORTGAGE LOAN PRINCIPAL BALANCE(1)



                                                     AGGREGATE      PERCENT OF
            RANGE OF CURRENT          NUMBER OF      PRINCIPAL      AGGREGATE
              MORTGAGE LOAN            MORTGAGE       BALANCE       PRINCIPAL
            PRINCIPAL BALANCE           LOANS       OUTSTANDING      BALANCE
            -----------------           -----       -----------      -------

     $16,494.11 to    50,000.00                       $                     %
      $50,000.01 to  100,000.00
     $100,000.01 to  150,000.00
     $150,000.01 to  200,000.00
     $200,000.01 to  250,000.00
     $250,000.01 to  300,000.00
     $300,000.01 to  350,000.00
     $350,000.01 to  400,000.00
     $400,000.01 to  450,000.00
     $450,000.01 to  500,000.00
     $500,000.01 to  550,000.00
     $550,000.01 to  600,000.00
     $650,000.01 to  700,000.00
     $700,000.01 to  750,000.00
     $950,000.01 to 1,000,000.00
                                       -------        -------        -------
                         Total                        $               100.00%
                                       =======        =======        =======



                                       24


                   CURRENT MORTGAGE LOAN PRINCIPAL BALANCE(1)



                                                     AGGREGATE      PERCENT OF
            RANGE OF CURRENT          NUMBER OF      PRINCIPAL      AGGREGATE
              MORTGAGE LOAN            MORTGAGE       BALANCE       PRINCIPAL
            PRINCIPAL BALANCE           LOANS       OUTSTANDING      BALANCE
            -----------------           -----       -----------      -------





(1)  The average current principal balance of the statistical calculation
initial mortgage loans in loan group 2 is expected to be approximately $     .


                               OCCUPANCY TYPES(1)


                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
             OCCUPANCY TYPE             LOANS       OUTSTANDING      BALANCE
             --------------             -----       -----------      -------

     Primary Home                                     $                     %
     Investor
     Second Home
                                       -------        -------        -------
     Total                                            $               100.00%
                                       =======        =======        =======


(1)  Based upon representations of the related mortgagors at the time of
origination.


                   STATE DISTRIBUTION OF MORTGAGED PROPERTIES



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
           STATE OR TERRITORY           LOANS       OUTSTANDING      BALANCE
           ------------------           -----       -----------      -------

     California                                       $                     %
     Texas
     New Jersey
     New York
     Arizona
     Florida
     Colorado
     Minnesota
     North Carolina
     Utah



                                       25


                   STATE DISTRIBUTION OF MORTGAGED PROPERTIES



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
           STATE OR TERRITORY           LOANS       OUTSTANDING      BALANCE
           ------------------           -----       -----------      -------

     Maryland
     Connecticut
     Massachusetts
     Nevada
     Washington
     Pennsylvania
     Virginia
     Michigan
     South Carolina
     Missouri
     Illinois
     Oregon
     Georgia
     Idaho
     Iowa
     Kansas
     Tennessee
     Vermont
     Alaska
     Montana
     Hawaii
     Ohio
     Wisconsin
     New Mexico
     New Hampshire
     Delaware
     Indiana
     Arkansas
     Maine
     Oklahoma
     Rhode Island
     District of Columbia
     Wyoming
     Louisiana
     Kentucky
     West Virginia



                                       26


                   STATE DISTRIBUTION OF MORTGAGED PROPERTIES



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
           STATE OR TERRITORY           LOANS       OUTSTANDING      BALANCE
           ------------------           -----       -----------      -------

     South Dakota
     Alabama
     North Dakota
     Nebraska
                                       -------        -------        -------
     Total                                            $               100.00%
                                       =======        =======        =======


                            PURPOSE OF MORTGAGE LOANS



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
              LOAN PURPOSE              LOANS       OUTSTANDING      BALANCE
              ------------              -----       -----------      -------

     Purchase                                         $                     %
     Refinance (Cash Out)
     Refinance (Rate or Term)
                                       -------        -------        -------
     Total                                            $               100.00%
                                       =======        =======        =======


                  DOCUMENTATION PROGRAMS FOR MORTGAGE LOANS(1)



     Full Documentation                               $                     %
     Reduced Documentation
     No Ratio
     No Documentation
                                       -------        -------        -------
     Total                                            $               100.00%
                                       =======        =======        =======


(1)  The Full, Reduced, No Ratio, and No Documentation Programs are described
under the heading "--Underwriting Standards."


                                       27


                           TYPE OF MORTGAGE PROPERTIES



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
              PROPERTY TYPE             LOANS       OUTSTANDING      BALANCE
              -------------             -----       -----------      -------

     Single Family Residence/D-PUD                    $                     %
     PUD
     Manufactured Home(1)
     Two Units
     Low Rise Condominium
     Three Units
     Cooperative
     Four Units
     High Rise Condominium
     Townhouse
                                       -------        -------        -------
     Total                                            $               100.00%
                                       =======        =======        =======


(1)  Treated as real property.


                      FICO CREDIT SCORES FOR MORTGAGE LOANS



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                  FICO                 MORTGAGE       BALANCE       PRINCIPAL
              CREDIT SCORE              LOANS       OUTSTANDING      BALANCE
              ------------              -----       -----------      -------

        500-549                                       $                     %
        550-599
        600-649
        650-699
        700-749
        750-799
        850-899
        900-900
     Not Available
                                       -------        -------        -------
     Total                                            $               100.00%
                                       =======        =======        =======



                                       28


                       CREDIT LEVELS FOR MORTGAGE LOANS(1)



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
              CREDIT LEVEL              LOANS       OUTSTANDING      BALANCE
              ------------              -----       -----------      -------

     1                                                $                     %
     1+
     2
     3
     4
     Not Available
                                       -------        -------        -------
     Total                                            $               100.00%
                                       =======        =======        =======


(1) Credit Levels are assigned as described under the heading "--Underwriting
     Standards."


                                    MARGIN(1)



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
               MARGIN (%)               LOANS       OUTSTANDING      BALANCE
               ----------               -----       -----------      -------

     4.750-4.750                                      $                     %
     4.751-5.000
     5.001-5.250
     5.251-5.500
     5.501-5.750
     5.751-6.000
     6.001-6.250
     6.251-6.500
     6.501-6.750
     6.751-7.000
     7.001-7.250
     7.251-.500
     7.501-7.750
     7.751-8.000
     8.001-8.250
     8.251-8.500
     8.751-9.000


                                       29




     9.001-9.250
                                       -------        -------        -------
     Total                                            $               100.00%
                                       =======        =======        =======


(1)  The weighted average Margin of the statistical calculation initial mortgage
loans in loan group 2 is expected to be approximately      %.


                            NEXT ADJUSTMENT DATES(1)



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                                       MORTGAGE       BALANCE       PRINCIPAL
                 MONTHS                 LOANS       OUTSTANDING      BALANCE
                 ------                 -----       -----------      -------

                                                      $                     %














                                       -------        -------        -------
               Total                                  $               100.00%
                                       =======        =======        =======


(1)  The weighted average months to next Adjustment Date for the statistical
calculation initial mortgage loans in loan group 2 is expected to be     months.


                                       30


                                MAXIMUM RATES(1)



                                                     AGGREGATE      PERCENT OF
                                      NUMBER OF      PRINCIPAL      AGGREGATE
                 MAXIMUM               MORTGAGE       BALANCE       PRINCIPAL
                RATE (%)                LOANS       OUTSTANDING      BALANCE
                --------                -----       -----------      -------

                                                      $                     %























                                       -------        -------        -------
               Total                                  $               100.00%
                                       =======        =======        =======


(1)  The weighted average Maximum Rate of the statistical calculation initial
mortgage loans in loan group 2 is expected to be approximately      %.


ASSIGNMENT OF THE MORTGAGE LOANS

     Pursuant to the pooling and servicing agreement, on the closing date the
seller will sell, transfer, assign, set over and otherwise convey without
recourse to the depositor all right, title and interest of the seller, and the
depositor will sell, transfer, assign, set over and otherwise convey without
recourse to the trustee in trust for the benefit of the certificateholders all
right, title and interest of the depositor, in and to each mortgage loan and all
right, title and interest in


                                       31


and to all other assets included in Home Equity Mortgage Loan Asset-Backed
Trust, Series SPMD 200[ ]-     , including all principal and interest received
on or with respect to the mortgage loans, exclusive of principal and interest
due on or prior to the cut-off date and the pre-funded amount deposited in the
pre-funding accounts on the closing date.

     In connection with the transfer and assignment, the depositor will deliver
or cause to be delivered to the trustee, or a custodian for the trustee, among
other things, the original mortgage note (and any modification or amendment
thereto) endorsed in blank without recourse, except that the depositor may
deliver or cause to be delivered a lost note affidavit in lieu of any original
mortgage note that has been lost, the original mortgage creating a first or
second lien on the related mortgaged property with evidence of recording
indicated thereon, an assignment in recordable form of the mortgage, the title
policy with respect to the related mortgaged property and, if applicable, all
recorded intervening assignments of the mortgage and any riders or modifications
to the mortgage note and mortgage (except for any document not returned from the
public recording office, which will be delivered to the trustee as soon as the
same is available to the depositor). With respect to up to [ ]% of the initial
mortgage loans and [ ]% of the Subsequence Mortgage Loans (referred to as
Delayed Delivery Loans), the depositor may deliver all or a portion of each
related mortgage file to the trustee not later than five business days after the
closing date. Assignments of the mortgage loans to the trustee (or its nominee)
will be recorded in the appropriate public office for real property records,
except in states such as California where, in the opinion of counsel, recording
is not required to protect the trustee's interest in the mortgage loan against
the claim of any subsequent transferee or any successor to or creditor of the
depositor or the seller.

     The trustee will review each mortgage file within 90 days of the closing
date or subsequent transfer date, as applicable (or promptly after the trustee's
receipt of any document permitted to be delivered after the closing date or
subsequent transfer date, as applicable), and if any document in a mortgage file
is found to be missing or non-compliant with the review criteria set forth in
the pooling and servicing agreement and the seller does not cure that defect
within 90 days of notice thereof from the trustee (or within a longer period not
to exceed 720 days after the closing date as provided in the pooling and
servicing agreement in the case of missing documents not returned from the
public recording office), the seller will be obligated to repurchase the related
mortgage loan from the trust fund. Rather than repurchase the mortgage loan as
provided above, the seller may remove the mortgage loan (referred to as deleted
mortgage loan) from the trust fund and substitute in its place another mortgage
loan (a replacement mortgage loan); however, substitution is permitted only
within two years of the closing date and may not be made unless an opinion of
counsel is provided to the trustee to the effect that substitution will not
disqualify the trust fund as a REMIC or result in a prohibited transaction tax
under the Code. Any replacement mortgage loan generally will, on the date of
substitution, among other characteristics set forth in the pooling and servicing
agreement,

     o    have a principal balance, after deduction of all scheduled payments
due in the month of substitution, not in excess of, and not more than 10% less
than, the Stated Principal Balance of the deleted mortgage loan (the amount of
any shortfall to be deposited by the seller and held for distribution to the
certificateholders on the related distribution date (referred to as a
Substitution Adjustment Amount)),


                                       32


     o    have a current Mortgage Rate not lower than, and not more than 1% per
annum higher than, that of the deleted mortgage loan,

     o    with respect to the mortgage loans in loan group 2, (a) have a
mortgage rate based upon the same Loan Index and a Margin at least equal to and
not greater than 50 basis points higher than the deleted mortgage loan, (b) have
a mortgage rate subject to a maximum rate that is no less than the maximum Rate
applicable to the deleted mortgage loan, (c) have Adjustment Dates that are no
more or less frequent than the deleted mortgage loan and (d) not be a
Performance Loan,

     o    have a Loan-to-Value Ratio or Combined Loan-to-Value Ratio (as
applicable) not higher than that of the deleted mortgage loan,

     o    have a remaining term to maturity not greater than (and not more than
one year less than) that of the deleted mortgage loan, and

     o    comply with all of the representations and warranties set forth in the
agreement as of the date of substitution.

     This cure, repurchase or substitution obligation constitutes the sole
remedy available to certificateholders or the trustee for omission of, or a
material defect in, a mortgage loan document.

CONVEYANCE OF SUBSEQUENT MORTGAGE LOANS

     On the closing date the excess of the aggregate class certificate balance
of the certificates over the principal balance of the initial mortgage loans on
      , 200[ ] (which excess is not expected to exceed $         ) will be
deposited in two pre-funding accounts established and maintained by the trustee
on behalf of the certificateholders. The amount on deposit in one pre-funding
account will be allocated to purchase fixed rate mortgage loans for loan group 1
and the amount on deposit in the second pre-funding account will be allocated to
purchase adjustable rate mortgage loans for loan group 2. During the pre-funding
period, the depositor is expected to purchase conventional subprime mortgage
loans acquired by the seller after      , 200[ ] from the seller and sell those
subsequent mortgage loans to the trust fund as described below. The purchase
price for each subsequent mortgage loan will equal the Stated Principal Balance
of such subsequent mortgage loan as of the date of origination of such
subsequent mortgage loan (unless such subsequent mortgage loan was originated
prior to       , 200[ ], in which case, as of      , 200[ ]) and will be paid
from the related pre-funding account. Accordingly, the purchase of subsequent
mortgage loans will decrease the amount on deposit in the pre-funding accounts
and increase the Stated Principal Balance of the mortgage pool. The pre-funding
period terminates upon the earlier of the date on which the remaining
pre-funding amount is less than $[100,000] and the close of business on [     ],
200[ ].

     Pursuant to the pooling and servicing agreement and a subsequent transfer
agreement to be executed by the seller, the depositor and the trustee, the
conveyance of subsequent mortgage loans may be made on any business day during
the pre-funding period, subject to certain conditions in the pooling and
servicing agreement being satisfied, including that:


                                       33


     o    the subsequent mortgage loans conveyed on the subsequent transfer date
satisfy the same representations and warranties in the pooling and servicing
agreement applicable to all mortgage loans,

     o    the subsequent mortgage loans conveyed on the subsequent transfer date
were selected in a manner reasonably believed not to be adverse to the interests
of the certificateholders,

     o    the trustee receives an opinion of counsel with respect to the
validity of the conveyance of the subsequent mortgage loans conveyed on the
subsequent transfer date and the absence of any adverse effect on the REMIC,

     o    the conveyance of the subsequent mortgage loans on the subsequent
transfer date will not result in a reduction or withdrawal of any ratings
assigned to the offered certificates,

     o    no subsequent mortgage loan conveyed on the subsequent transfer date
was 30 or more days delinquent,

     o    each subsequent mortgage loan conveyed on the subsequent transfer date
that is an adjustable rate mortgage loan is secured by a first lien on the
related mortgaged property, and

     o    following the conveyance of the subsequent mortgage loans on the
subsequent transfer date, the characteristics of each loan group to which
mortgage loans were added pursuant to such conveyance will remain substantially
similar to the characteristics of each loan group as of the initial cut-off
date.

UNDERWRITING STANDARDS

     [The mortgage loans were originated in accordance with [IndyMac Bank]'s
underwriting standards for sub-prime mortgage loans described below. [IndyMac,
Inc.], the entity whose assets were transferred to [IndyMac Bank] as described
in this prospectus supplement under "Servicing of the Mortgage Loans--The Master
Servicer", began operating a mortgage conduit program in 1993 and began in April
1995 to purchase mortgage loans made to borrowers with prior credit difficulties
(so-called "subprime mortgage loans"). All of the subprime mortgage loans
purchased by IndyMac Bank are "conventional non-conforming mortgage loans"
(i.e., loans which are not insured by the Federal Housing Authority or partially
guaranteed by the Veterans Administration and that conform to Fannie Mae or
Freddie Mac underwriting guidelines) secured by first or second liens on one-to
four-family residential properties.

     [IndyMac Bank] purchases subprime mortgage loans from, or provides funding
for subprime mortgage loans originated by, banks, savings and loan associations,
mortgage bankers (which may or may not be affiliated with [IndyMac Bank]) and
mortgage brokers (each is referred to as a loan originator) either under flow or
bulk purchase arrangements, the terms of which may vary from loan originator to
loan originator. The loan originators are required to be HUD approved
mortgagees. In addition to purchasing mortgage loans from (or providing funding
to) loan originators, [IndyMac Bank] also engages in the direct origination of
mortgage loans.

     [IndyMac Bank]'s underwriting standards for subprime mortgage loans are
primarily intended to evaluate the value and adequacy of the mortgaged property
as collateral for the


                                       34


proposed mortgage loan, as well as the type and intended use of the mortgaged
property. Its underwriting standards are less stringent than the standards
generally acceptable to Fannie Mae and Freddie Mac with regard to the borrower's
credit standing and repayment ability. Borrowers who qualify under the [IndyMac
Bank] underwriting standards for subprime mortgage loans generally have payment
histories and debt-to-income ratios that would not satisfy Fannie Mae and
Freddie Mac underwriting guidelines and may have a record of major derogatory
credit items, such as outstanding judgments or prior bankruptcies, or lower
credit scores. As a result, the rates of delinquency, bankruptcy and foreclosure
for those mortgage loans could be higher, and may be substantially higher, than
that of mortgage loans underwritten in accordance with Fannie Mae and Freddie
Mac standards.

     In the process of underwriting mortgage loans, [IndyMac Bank] may use its
"electronic Mortgage Information and Transaction System" (or "e-MITS"), a
proprietary, internet-based, point-of-sale automated underwriting and risk-based
pricing system to underwrite and price the mortgage loans. This system uses
proprietary credit and risk analysis information generated from statistical
analysis of [IndyMac Bank]'s historical database of over 300,000 loans to
determine the economic levels at which a given loan should be approved. The
system also incorporates information from models provided by credit rating
agencies. e-MITS analyzes over forty data elements relating to the mortgager and
the mortgaged property before rendering an approval and a risk-based price. As
with [IndyMac Bank]'s traditional underwriting process, this approval is subject
to full and complete data verification. Loans approved by e-MITS comply with
[IndyMac Bank]'s underwriting guidelines. As is the case with loans that are not
underwritten through e-MITS, exceptions to standard underwriting guidelines are
permitted where compensating factors are present or in the context of negotiated
bulk purchases.

     Each of the sub-prime mortgage loans purchased or originated by IndyMac
Bank is assigned to one of five credit levels. The credit levels are, in
descending order of credit-worthiness, 1+, 1, 2, 3 and 4. Through December 2000,
the credit level for sub-prime mortgage loans purchased or originated was
primarily based on the prospective mortgagor's FICO Credit Score. After December
2000, the credit level was further evaluated based on the prospective
mortgagor's mortgage payment history, foreclosure, and bankruptcy history.
Higher frequency of late mortgage payments and recency of foreclosure and
bankruptcy cause the loans to be rated with a higher numerical credit level. The
mortgage pool will also include some number of Mortgage Loans that were
underwritten to standards targeted at borrowers with generally better credit
ratings than sub-prime borrowers. Such Mortgage Loans are indicated in this
prospectus supplement as having a credit level of "NSP."

     Borrowers are assigned a credit grade primarily on the basis of their FICO
Score, mortgage/rent payments delinquent in the prior 12 months, prior
foreclosures, and prior bankruptcies. The following table summarizes the various
credit levels:


                                       35


                                  CREDIT LEVEL


--------------------------- ----------------- ----------------- ----------------- ----------------- ------------------
                            1+                1                 2                 3                 4
--------------------------- ----------------- ----------------- ----------------- ----------------- ------------------

Decision Credit             600 - 619         575 - 599         550 - 574         525 - 549         500 - 524
Score
--------------------------- ----------------- ----------------- ----------------- ----------------- ------------------
Mortgage/Rent
Payments                          1x30               2x30            4x30             6x30
Delinquent in Last                0x60               0x60            1x60             1x60          No limit
12 Months                         0x90               0x90            0x90             1x90
--------------------------- ----------------- ----------------- ----------------- ----------------- ------------------
                                                                                                        No time
Foreclosure(1) -                                                                                     requirement -
Months Since                     36                 24              24               12                  an open
Completion                                                                                           foreclosure is
                                                                                                    acceptable
--------------------------- ----------------- ----------------- ----------------- ----------------- ------------------
                                                                                                         No time
Bankruptcy -                                                                                          requirement -
Chapter 7, 11, 12 -         24 months         24 months         24 months         12 months              must be
Months Since                                                                                          discharged or
Discharge/ Dismissal                                                                                    dismissed
--------------------------- ----------------- ----------------- ----------------- ----------------- ------------------
Bankruptcy -                   24 months         24 months         24 months         12 months           No time
Chapter 13 -                    If open,          If open,          If open,          If open,         requirement
Months Since                  rating from       rating from       rating from       rating from        -bankruptcy
Discharge/                    trustee with      trustee with      trustee with      trustee with       must be paid,
Dismissal or                    a maximum         a maximum         a maximum         a maximum        discharged or
Filing Date                 of 1x30 in last      of 2x30 in     of 4x30 in last   of 6x30 in last      dismissed
                               12 months       last 12 months      12 months         12 months        through Loan
                                                                                                         closing
--------------------------- ----------------- ----------------- ----------------- ----------------- ------------------


(1)  A delinquency of 120 days or greater is considered a foreclosure,
regardless of whether foreclosure action has been commenced. Requirements apply
to all properties owned by the borrower.

     IndyMac Bank also accepts loans underwritten under one of five
documentation programs: Full/Alternate Documentation, Full Doc Express, Limited
Documentation, Stated Income, and No Ratio Documentation. For each credit level
and documentation program, IndyMac Bank has a maximum permitted loan amount, a
maximum Loan-to-Value Ratio or Combined Loan-to-Value Ratio (as applicable) and,
in some cases, a limitation on the loan purpose. The maximum debt to income
ratio for all loans is 55%. As with other underwriting guidelines, this
limitation may have been waived on a case by case basis.

     Under the Full/Alternate Documentation Program, the prospective borrower's
employment, income and assets are verified through written or telephonic
communications. All loans may be submitted under the Full/Alternate
Documentation Program. The Full/Alternate Documentation Program also provides
for alternative methods of employment verification generally using W-2 forms or
pay stubs.


                                       36


     Under the Full Doc Express Documentation Program, there is no minimum
requirement for length of employment for borrowers who do not use income from
self-employment for qualification purposes. Self-employed borrowers must have
two continuous years of self-employment. Borrowers may generally verify their
employment income with a recent Form W-2 statement. The borrower generally may
not use many of the other forms of income acceptable under the Full/Alternate
Documentation Program. Borrowers are only required to verify those assets that
are necessary to close the mortgage loan and are not required to verify other
assets shown on the loan application.

     The Limited Documentation Program is similar to the Full/Alternate
Documentation Program except that borrowers are generally not required to submit
copies of their tax returns and only must document income for six months (rather
than one or two years, as required by the Full/Alternate Documentation Program).

     Under the Stated Income Documentation Program and the No Ratio Program,
more emphasis is placed on the prospective borrower's credit score and on the
value and adequacy of the mortgaged property as collateral and other assets of
the prospective borrower than on income underwriting. The Stated Income
Documentation Program is only available to borrowers who use self-employment
income as all or part of their qualifying income and requires prospective
borrowers to provide information regarding their assets and income. Information
regarding assets is verified through written communications. Information
regarding income is not verified. The No Ratio Program requires prospective
borrowers to provide information regarding their assets, which is then verified
through written communications. The No Ratio Program does not require
prospective borrowers to provide information regarding their income. Employment
is orally verified under both programs.

     IndyMac may also acquire loans underwritten to a seller's guidelines that
permit other documentation programs including no doc programs.

                           SERVICING OF MORTGAGE LOANS

THE MASTER SERVICER

     [IndyMac Bank will act as master servicer. The principal executive offices
of the master servicer are located at 155 North Lake Avenue, Pasadena,
California 91101. IndyMac Bank is a wholly-owned subsidiary of IndyMac
Intermediate Holdings, Inc., which is a wholly-owned subsidiary of IndyMac
Bancorp, Inc.

     Effective July 1, 2000, IndyMac Mortgage Holdings, Inc. ("Holdings")
acquired SGV Bancorp, the holding company of First Federal Savings and Loan
Association of San Gabriel Valley ("First Federal"). In connection with that
acquisition, IndyMac, Inc., the wholly-owned mortgage banking subsidiary of
Holdings, was merged with and into SGV Bancorp, and SGV Bancorp contributed
substantially all of its assets and liabilities (including the servicing
platform and all of the related servicing operations of the former IndyMac,
Inc., together with substantially all of its personnel) to First Federal. Also
in connection with the acquisition, Holdings changed its name to IndyMac
Bancorp, Inc.; SGV Bancorp changed its name to


                                       37


IndyMac Intermediate Holdings, Inc. and First Federal changed its name to
IndyMac Bank, F.S.B.

     The master servicer will be responsible for servicing the mortgage loans in
accordance with the terms set forth in the pooling and servicing agreement
employing the same degree of skill and care which it employs in servicing the
mortgage loans comparable to the mortgage loans serviced by the master servicer
for itself or others. The master servicer may perform its servicing obligations
under the pooling and servicing agreement through one or more subservicers
selected by the master servicer. Notwithstanding any subservicing agreement, the
master servicer will remain liable for its servicing duties and obligations
under the pooling and servicing agreement as if the master servicer alone were
servicing the mortgage loans.

     During the first half of 1998, the former IndyMac, Inc. acquired a
servicing platform (i.e., the servicing business operations but not mortgage
loans) from First of America Loan Services, Inc. in order to provide IndyMac,
Inc. with direct servicing capabilities for mortgage loans, including sub-prime
mortgage loans. Prior to that time, IndyMac, Inc. had master servicing
capabilities but no direct servicing capabilities. In connection with the
acquisition of SGV Bancorp, the servicing platform of First of America Loan
Services, Inc. was contributed to IndyMac Bank. As of the closing date, it is
expected that IndyMac Bank will directly service substantially all of the
initial mortgage loans (by cut-off date pool principal balance). With respect to
the other mortgage loans in the mortgage pool, as of the closing date, it is
expected that IndyMac Bank will perform its servicing obligations under the
pooling and servicing agreement through one or more subservicers.

     If the servicing of any mortgage loan were to be transferred from a
subservicer to IndyMac Bank, or if any other servicing transfer were to occur,
there may be an increase in all delinquencies and defaults due to misapplied or
lost payments, data input errors, system incompatibilities or otherwise.
Although any increase in delinquencies is expected to be temporary, there can be
no assurance as to the duration or severity of any disruption in servicing the
applicable mortgage loans as a result of any servicing transfer.

FORECLOSURE, DELINQUENCY AND LOSS EXPERIENCE

     IndyMac, Inc. commenced master servicing conventional mortgage loans during
April 1993 and commenced servicing conventional mortgage loans during August
1998. In connection with the acquisition of SGV Bancorp, the master servicing
and servicing operations of the former IndyMac, Inc. were contributed to IndyMac
Bank, resulting in IndyMac Bank performing the master servicing and servicing
operations previously performed by IndyMac, Inc.

     The delinquency and loss statistics may be affected by the size and
relative lack of seasoning of the portfolio because many of the loans were not
outstanding long enough to give rise to some or all of the periods of
delinquency and loss indicated in the charts below. Accordingly, the information
in the tables below (which includes mortgage loans with underwriting, payment
and other characteristics which differ from those of the mortgage loans in the
trust fund) should not be considered as a basis for assessing the likelihood,
amount, or severity of delinquency or losses on the mortgage loans, and no
assurances can be given that the


                                       38


delinquency, foreclosure and loss experience presented these tables will be
indicative of the experience on the mortgage loans in the future.

     The following table summarizes the delinquency and foreclosure experience
as of      ,      , and on approximately $      , $      , $      million and
$      billion, respectively, in outstanding principal balance of sub-prime
mortgage loans master serviced or serviced by IndyMac Bank (does not include
loans that were part of First Federal's portfolio prior to its acquisition by
IndyMac Bancorp). The table below excludes sub-prime mortgage loans where the
borrower has filed for bankruptcy.



                                                     ----------      ----------       ---------       ---------

Total Number of Sub-Prime Mortgage Loans in
Portfolio                                              _______          ______          ______          ______


Delinquent Mortgage Loans and Pending
Foreclosures at Period End(1):

30-59 days                                                    %              %                %              %
60-89 days
90 days or more (excluding pending foreclosures)

Total delinquencies                                           %              %                %              %

Foreclosures pending                                          %              %                %              %

Total delinquencies and foreclosures pending                  %               %               %              %
                                                    ----------      ----------       ----------    ----------


(1)  As a percentage of the total number of loans master serviced or serviced.

     The following table summarizes the loss experience on the dates indicated
of sub-prime mortgage loans originated or acquired by IndyMac Bank and serviced
or master serviced by IndyMac Bank and securitized by the depositor or CWMBS,
Inc. (does not include loans that were part of First Federal's portfolio prior
to its acquisition by IndyMac Bancorp):



                                       CUMULATIVE NET              CUMULATED STATED
                                           LOSSES                AMOUNT OF SECURITIES           LOSS RATIO(1)
                                           ------                --------------------           -------------

As of December 31,                          $                       $                               %
As of December 31,                          $                       $                               %
As of December 31,                          $                       $                               %
As of                                       $                       $                               %


(1)  Loss Ratio represents cumulative net losses as a percentage of the
aggregate principal balance of sub-prime mortgage loans securitized.


                                       39


     Historically, a variety of factors, including the appreciation of real
estate values, has limited the master servicer's loss and delinquency experience
on its portfolio of serviced mortgage loans. There can be no assurance that
factors beyond the master servicer's control, such as national or local economic
conditions or downturns in the real estate markets of its lending areas, will
not result in increased rates of delinquencies and foreclosure losses in the
future. For example, a general deterioration of the real estate market regions
where the mortgaged properties are located may result in increases in
delinquencies of loans secured by real estate, slower absorption rates of real
estate into the market and lower sales prices for real estate. A general
weakening of the economy may result in decreases in the financial strength of
borrowers and decreases in the value of collateral serving as collateral for
loans. If the real estate market and economy continue to decline, the master
servicer may experience an increase in delinquencies on the loans it services
and higher net losses on liquidated loans.]

SERVICING COMPENSATION AND PAYMENT OF EXPENSES

     The "Expense Fee Rate" is the rate at which expense fees accrue on the
principal balances of each mortgage loan. The expense fees are payable out of
the interest payments of each mortgage loan. The expense fees will vary from
mortgage loan to mortgage loan. As of the cut-off date, the weighted average
expense fee rate is expected to equal approximately     %. The expense fees
consist of (a) master servicing compensation, (b) servicing compensation, (c)
fees payable to trustee in respect of its activities as trustee under the
pooling and servicing agreement and (d) lender-paid primary mortgage insurance
premiums. In cases where a mortgage loan is being directly serviced by the
master servicer, the master servicer will be entitled to the master servicing
fee and the servicing fee. In cases where a mortgage loan is being directly
serviced by a subservicer, the subservicer will be entitled to the servicing fee
and the master servicer will only be entitled to the master servicing fee. The
master servicer is obligated to pay certain ongoing expenses associated with the
trust fund and incurred by the master servicer in connection with its
responsibilities under the pooling and servicing agreement and those amounts
will be paid by the master servicer out of its fee. The amount of the master
servicing compensation is subject to adjustment with respect to prepaid mortgage
loans, as described in this prospectus supplement under "--Adjustment to
Servicing Compensation in Connection with Certain Prepaid Mortgage Loans." The
master servicer will also be entitled to receive late payment fees, assumption
fees, prepayment fees and other similar charges. The master servicer will be
entitled to receive all reinvestment income earned on amounts on deposit in the
collection account, the certificate account and the distribution account. The
adjusted net mortgage rate of a mortgage loan is the mortgage loan's mortgage
rate (net of the interest premium charged by the related lenders for any
lender-acquired primary mortgage insurance) minus the related expense fee rate.

ADJUSTMENT TO SERVICING COMPENSATION IN CONNECTION WITH CERTAIN PREPAID
MORTGAGE LOANS

     When a borrower prepays a mortgage loan between Due Dates, the borrower is
     required to pay interest on the amount prepaid only to the date of
     prepayment and not thereafter. Similarly, if the master servicer purchases
     a mortgage loan as described in this prospectus supplement under "--Certain
     Modifications and Refinancings," the trust fund is entitled to the interest
     paid by the borrower only to the first day of the month in which the


                                       40


     purchase price is to be distributed. Except with respect to the month of
     the initial cut-off date, principal prepayments by borrowers received by
     the master servicer from the first day through the fifteenth day of a
     calendar month will be distributed to certificateholders on the
     distribution date in the same month in which the prepayments on such
     mortgage loans are received and, accordingly, no shortfall in the amount of
     interest to be distributed to certificateholders with respect to the
     prepaid mortgage loans will result. Conversely, principal prepayments on
     such mortgage loans received by the master servicer from the sixteenth day
     (or, in the case of the first distribution date, from the initial cut-off
     date) through the last day of a calendar month will be distributed to
     certificateholders on the distribution date in the month following the
     month of receipt and, accordingly, a shortfall in the amount of interest to
     be distributed to certificateholders with respect to such prepaid mortgage
     loans would result. To offset any interest shortfall to certificateholders
     as a result of any prepayments, the master servicer will be required to
     reduce its servicing compensation, but the reduction for any distribution
     date will be limited to an amount (this amount is referred to as
     "Compensating Interest") equal to the lesser of (i) prepayment interest
     shortfalls or (ii) the product of

     o    0.125% multiplied by

     o    one-twelfth multiplied by

     o    the pool principal balance as of the first day of the prior month.

ADVANCES

     Except as described below, the master servicer will be required to advance
prior to each distribution date, from its own funds or amounts received with
respect to the mortgage loans that do not constitute Available Funds for this
distribution date, an amount (referred to as an advance) equal to

     o    all of the payments of principal and interest on the mortgage loans
due during the related Remittance Period and delinquent as of the "determination
date" (which will be the 18th of the month or, if the 18th is not a business
day, the next business day after the 18th of the month)

     minus

     o    the total of

     o    the master servicing fee for the related period

     o    the applicable servicing fee for the related period

     plus

     o    an amount equivalent to interest on each mortgage loan as to which the
related mortgaged property has been acquired by the trust fund (through
foreclosure or deed-in-lieu of foreclosure).


                                       41


     Advances are intended to maintain a regular flow of scheduled interest and
principal payments on the certificates rather than to guarantee or insure
against losses. The master servicer is obligated to make advances with respect
to delinquent payments of principal of or interest on each mortgage loan to the
extent that those advances are, in its reasonable judgment, recoverable from
future payments and collections or insurance payments or proceeds of liquidation
of the related mortgage loan. If the master servicer determines on any
determination date to make an advance, that advance will be included with the
distribution to certificateholders on the related distribution date. Any failure
by the master servicer to make or deposit in the certificate account, including
any failure to make an advance, will constitute an event of default under the
pooling and servicing agreement if the failure remains unremedied for five days
after written notice thereof. If the master servicer is terminated as a result
of the occurrence of an event of default, the trustee or the successor master
servicer will be obligated to make any required advance, in accordance with the
terms of the pooling and servicing agreement.

CERTAIN MODIFICATIONS AND REFINANCINGS

     The master servicer may modify any mortgage loan upon the request of the
related mortgagor, provided that the master servicer purchases the mortgage loan
from the trust fund immediately preceding the modification. Any modification of
a mortgage loan may not be made unless the master servicer determines that the
modification includes a change in the interest rate on the related mortgage loan
to approximately a prevailing market rate. Any purchase of a mortgage loan
subject to a modification will be for a price equal to 100% of the outstanding
stated principal balance of the mortgage loan, plus accrued and unpaid interest
on the mortgage loan up to the date of purchase at a rate equal to the
applicable mortgage rate minus the master servicing fee rate, net of any
unreimbursed advances of principal and interest on the mortgage loan made by the
master servicer. The master servicer will deposit the purchase price in the
certificate account within one business day of the purchase of that mortgage
loan. Purchases of mortgage loans may occur when prevailing interest rates are
below the interest rates on the mortgage loans and mortgagors request
modifications as an alternative to refinancings. The master servicer will
indemnify the trust fund against liability for any prohibited transactions taxes
and any related interest, additions or penalties imposed on the REMIC as a
result of any modification or purchase.

DEFAULT MANAGEMENT SERVICES

     In connection with the servicing of defaulted mortgage loans, the master
servicer may perform certain default management and other similar services
(including, but not limited to, appraisal services) and may act as a broker in
the sale of mortgaged properties related to those mortgage loans. The master
servicer will be entitled to reasonable compensation for providing those
services.

                         DESCRIPTION OF THE CERTIFICATES

GENERAL

     The certificates will be issued pursuant to the pooling and servicing
agreement. The following summaries of the material terms pursuant to which the
certificates were issued do not


                                       42


purport to be complete and are subject to, and are qualified in their entirety
by reference to, the provisions of the pooling and servicing agreement. When
particular provisions or terms used in the pooling and servicing agreement are
referred to, the actual provisions (including definitions of terms) are
incorporated by reference.

     The Home Equity Mortgage Loan Asset-Backed Certificates, Series SPMD
200[ ]-       will consist of the following certificates: (a) Class AF-1
Certificates (referred to as the Group 1 Class A Certificates), the Class MF-1
and Class MF-2 Certificates (referred to as the Group 1 Mezzanine Certificates)
and the Class BF Certificates (referred to, with the Group 1 Mezzanine
Certificates, as the Group 1 Subordinated Certificates), (b) Class AV-1
Certificates (referred to as the Group 2 Class A Certificates), the Class MV-1
and Class MV-2 Certificates (referred to as the Group 2 Mezzanine Certificates)
and the Class BV Certificates (referred to, with the Group 2 Mezzanine
Certificates, as the Group 2 Subordinated Certificates), and (c) the Class R
Certificates (referred to as the Residual Certificates). The classes of offered
Certificates will have the respective initial Class Certificate Balances and
pass-through rates set forth on the cover page or described in this prospectus
supplement. In addition to the offered certificates, the trust fund will issue
the Class X Certificates. The Class X Certificates are not being offered hereby.
Any information contained in the prospectus supplement with respect to the Class
X Certificates is provided only to permit a better understanding of the offered
certificates.

     The Class Certificate Balance of any class of offered certificates as of
any distribution date is the initial Class Certificate Balance thereof reduced
by the sum of

     o    all amounts previously distributed to holders of certificates of that
class as payments of principal and,

     o    in the case of any class of Subordinated Certificates, the amount of
any Applied Realized Loss Amounts applicable to that class of Subordinated
Certificates not reimbursed before that distribution date.

     The book-entry certificates will be issuable in book-entry form only. The
physical certificates will be issued in fully registered certificated form. The
offered certificates (other than the Class R Certificates) will be issued in
minimum dollar denominations of $25,000 and integral multiples of $1,000 in
excess thereof. A single certificate of those classes may be issued in an amount
different than described above. The Class R Certificates will be issued as a
single certificate in a denomination of $100.

BOOK-ENTRY CERTIFICATES

     Persons acquiring beneficial ownership interests in the offered
certificates may elect to hold their offered certificates through The Depository
Trust Company (referred to as the Depository) in the United States, or
Clearstream, Luxembourg or the Euroclear System ("Euroclear"), in Europe. Each
class of book-entry certificates will be issued in one or more certificates
which equal the aggregate initial Class Certificate Balance of those classes of
certificates and which will be held by a nominee of the Depository. Clearstream,
Luxembourg and Euroclear will hold omnibus positions on behalf of their
participants through customers' securities accounts in Clearstream, Luxembourg
and Euroclear's names on the books of their respective depositaries which in
turn will hold such positions in customers' securities accounts in

                                       43


the depositaries' names on the books of the Depository. Beneficial interests in
the book-entry certificates will be held indirectly by investors through the
book-entry facilities of the Depository, as described in this prospectus
supplement. Investors may hold those beneficial interests in the book-entry
certificates in minimum denominations representing an original principal amount
of $25,000 and integral multiples of $1,000 in excess thereof. One investor of
each class of book-entry certificates may hold a beneficial interest therein
that is not an integral multiple of $1,000. The depositor has been informed by
the Depository that its nominee will be CEDE & Co. Accordingly, CEDE is expected
to be the holder of record of the book-entry certificates. Except as described
in the prospectus under "Description of the Securities--Book-Entry Registration
of Securities" no beneficial owner acquiring a book-entry certificate will be
entitled to receive a physical certificate representing the certificate.

     Unless and until definitive certificates are issued, it is anticipated that
the only certificateholder of the book-entry certificates will be CEDE, as
nominee of the Depository. Beneficial owners of the book-entry certificates will
not be certificateholders, as that term is used in the pooling and servicing
agreement. Beneficial owners are only permitted to exercise the rights of
certificateholders indirectly through financial intermediaries and the
Depository. Monthly and annual reports on the trust fund provided to CEDE, as
nominee of the Depository, may be made available to beneficial owners upon
request, in accordance with the rules, regulations and procedures creating and
affecting the Depository, and to the financial intermediaries to whose
Depository accounts the book-entry certificates of those beneficial owners are
credited.

     For a description of the procedures generally applicable to the book-entry
certificates, see "Description of the Securities--Book-Entry Registration of
Securities" in the prospectus.

PAYMENTS ON MORTGAGE LOANS; ACCOUNTS

     On or prior to the closing date, the master servicer will establish an
account (referred to as the distribution account), which shall be maintained
with the trustee in trust for the benefit of the certificateholders. On or prior
to the business day immediately preceding each distribution date, the master
servicer will withdraw from the certificate account the amount of Available
Funds and will deposit the Available Funds in the distribution account. Funds
credited to the certificate account and the distribution account may be invested
for the benefit and at the risk of the master servicer in Permitted Investments,
as defined in the pooling and servicing agreement. The amount, if any, remaining
in the pre-funding accounts at the end of the pre-funding period shall also be
deposited in the distribution account.

     "Available Funds" with respect to any distribution date and the mortgage
loans in a loan group will be equal to the sum of:

     o    all scheduled installments of interest (net of the related expense
fees for that loan group) and principal due on the Due Date on those mortgage
loans in the related Remittance Period and received prior to the related
determination date, together with any advances in respect thereof;

     o    all proceeds of any primary mortgage guaranty insurance policies and
any other insurance policies with respect to the mortgage loans in that loan
group, to the extent those


                                       44


proceeds are not applied to the restoration of the related mortgaged property or
released to the mortgagor in accordance with the master servicer's normal
servicing procedures (collectively referred to as insurance proceeds) and all
other cash amounts received and retained in connection with the liquidation of
defaulted mortgage loans in that loan group, by foreclosure or otherwise
(referred to as liquidation proceeds) during the related Remittance Period (in
each case, net of unreimbursed expenses incurred in connection with a
liquidation or foreclosure and unreimbursed advances, if any);

     o    all partial or full prepayments on the mortgage loans in that loan
group received during the related Remittance Period together with all
Compensating Interest thereon;

     o    amounts received with respect to that distribution date as the
Substitution Adjustment Amount or purchase price in respect of a deleted
mortgage loan in that loan group or a mortgage loan repurchased by the seller or
the master servicer in that loan group as of that distribution date, reduced by
amounts in reimbursement for advances previously made and other amounts as to
which the master servicer is entitled to be reimbursed pursuant to the pooling
and servicing agreement; and

     o    for the distribution dates in      and      200[ ], any amounts
withdrawn from the related Capitalized Interest Account and on the distribution
date immediately following the end of the pre-funding period, any amounts
remaining in the related pre-funding account, excluding any reinvestment
earnings.

     reduced by amounts in reimbursement for advances previously made and other
amounts as to which the master servicer is entitled to be reimbursed from the
certificate account pursuant to the pooling and servicing agreement.

     The "Remittance Period" with respect to any distribution date is the period
commencing on the second day of the month preceding the month in which the
distribution date occurs and ending on the first day of the month in which the
distribution date occurs.

     The "Prepayment Period" means for any distribution date, the period
commencing on the sixteenth day of the prior calendar month (or, in the case of
the first distribution date, [ ]) and ending on the fifteenth day of the
calendar month in which such distribution date occurs.

DISTRIBUTIONS

     Distributions on the certificates will be made by the trustee on the th day
of each month, or if that day is not a business day, on the first business day
thereafter (referred to as a distribution date), commencing in      200[ ], to
the persons in whose names the certificates are registered at the close of
business on the last business day of the month preceding the month of the
distribution date.

     Distributions on each distribution date will be made by wire transfer to
any certificateholder who has notified the trustee in writing in accordance with
the pooling and servicing agreement in immediately available funds to the
account of that certificateholder at a bank or other depository institution
having appropriate wire transfer facilities or by check upon the written request
of the certificateholder; provided, however, that the final distribution in
retirement of the certificates will be made only upon presentment and surrender
of those certificates at the office that the trustee may designate for such
purposes from time to time.


                                       45


PRIORITY OF DISTRIBUTIONS AMONG CERTIFICATES

     As more fully described in this prospectus supplement, distributions on the
certificates will be made on each distribution date from Available Funds for the
related loan group and will be made to the classes of certificates of the
related certificate group in the following order of priority:

     o    to interest on each class of certificates;

     o    to principal on the classes of certificates then entitled to receive
distributions of principal, in the order and subject to the priorities set forth
in this prospectus supplement under "--Distributions of Interest and Principal";

     o    to principal on the classes of certificates then entitled to receive
distributions of principal in order to maintain the Specified Subordinated
Amount for that certificate group;

     o    to unpaid interest and Applied Realized Loss Amounts in the order and
subject to the priorities described in this prospectus supplement under
"--Distributions of Interest and Principal"; and

     o    to deposit into the Excess Reserve Fund Account to cover any Basis
Risk CarryForward Amount and then to be released to the Class X Certificates, in
each case subject to certain limitations set forth in this prospectus supplement
under "--Distributions of Interest and Principal."

DISTRIBUTIONS OF INTEREST AND PRINCIPAL

     The pass-through rates for each class of fixed rate certificates shall be
as set forth on the cover page hereof, provided, however, that after the first
optional termination date, the pass-through rate for each class of fixed rate
certificates shall be increased by   % (   basis points) per annum. In addition,
the pass-through rate for each class of fixed rate certificates will be limited
to the Group I WAC Cap for that distribution date. The pass-through rate for
each class of group 2 certificates will be equal to the least of (x) One-Month
LIBOR plus the related pass-through margin for that class, (y) the weighted
average of the maximum lifetime mortgage rates on the mortgage loans in loan
group 2 less the expense fee rate (referred to as the Group 2 Maximum Cap), and
(z) the weighted average of the mortgage rates then in effect on the beginning
of the related Remittance Period on the mortgage loans in loan group 2 minus the
expense fee rate (referred to as the Group 2 WAC Cap). In addition to the
foregoing, after the optional termination date, the pass-through margin for the
Class AV-1 certificates shall be [doubled] and the pass-through margin for the
Class MV-1, Class MV-2 and Class BV certificates shall be multiplied by [1.5].

     Interest for each interest accrual period will be calculated on the basis
of the Class Certificate Balance immediately prior to the related distribution
date. [Interest on the fixed rate certificates will be calculated and payable on
the basis of a 360 day year divided into twelve 30 day months.] [Interest on the
adjustable-rate will be calculated on the basis of the actual number of days in
the related interest accrual period and a 360 day year.]


                                       46


     The "pass-through margin" for each class of adjustable rate certificates is
as follows: Class AV-1,     %; Class MV-1,     %; Class MV-2,     % and
Class BV,     %.

     On each distribution date, distributions in reduction of the Class
Certificate Balance of the certificates entitled to receive distributions of
principal will be made in an amount equal to the Principal Distribution Amount
for the related certificate group. The "Principal Distribution Amount" for each
certificate group and distribution date will equal the sum of (i) the Basic
Principal Distribution Amount for that distribution date for that certificate
group, (ii) the Extra Principal Distribution Amount for that distribution date
for that certificate group and (iii) for the first distribution date following
the end of the pre-funding period, any amount remaining in the related
pre-funding account (net of any investment income therefrom).

     On each distribution date, the trustee is required to make the
disbursements and transfers from the Available Funds for each loan group then on
deposit in the distribution account specified below in the following order of
priority:

     (i) to the holders of each class of offered certificates in the related
certificate group in the following order or priority:

     (a) to the Class A Certificates for the related certificate group, the
     related Accrued Certificate Interest and any Unpaid Interest Amounts for
     those classes, on that distribution date;

     (b) to the Class M-l Certificates of that certificate group, the Accrued
     Certificate Interest for that class on that distribution date;

     (c) to the Class M-2 Certificates of that certificate group, the Accrued
     Certificate Interest for that class on that distribution date;

     (d) to the Class B Certificates of that certificate group, the Accrued
     Certificate Interest for that class on that distribution date;

     (ii) A. with respect to each certificate group on each distribution date
(a) before the related Stepdown Date or (b) with respect to which a Trigger
Event is in effect, to the holders of the related class or classes of offered
certificates then entitled to distributions of principal as set forth below, an
amount equal to the applicable Principal Distribution Amount in the following
order or priority:

     (x) (1) in the case of certificate group 1, sequentially to the Class R and
Class AF-1 Certificates, in that order, until the respective Class Certificate
Balances thereof are reduced to zero;

     (2) in the case of certificate group 2, to the Class AV-1 Certificates
until the Class Certificate Balance thereof is reduced to zero;

     (y) for each certificate group, sequentially to the related Class M-1,
Class M-2 and Class B Certificates, in that order, until the respective Class
Certificate Balances are reduced to zero;


                                       47


     B. with respect to each certificate group on each distribution date (a) on
and after the related Stepdown Date and (b) as long as a Trigger Event for that
certificate group is not in effect, to the holders of the related class or
classes of offered certificates then entitled to distribution of principal an
amount equal to the applicable Principal Distribution Amount in the following
amounts and order of priority:

     (a) the lesser of (x) the Principal Distribution Amount and (y) the Class A
     Principal Distribution Amount, in the following order of priority:

     (1) in the case of certificate group 1, to the Class AF-1 Certificates,
until the Class Certificate Balance thereof is reduced to zero;

     (2) in the case of certificate group 2, to the Class AV-1 Certificates
until the Class Certificate Balance thereof is reduced to zero;

     (b) the lesser of (x) the excess of (i) the Principal Distribution Amount
     over (ii) the amount distributed to the Class A Certificateholders in
     clause (ii) B. (a) above and (y) the Class M-1 Principal Distribution
     Amount to the Class M-1 Certificateholders, until the Class Certificate
     Balance thereof has been reduced to zero;

     (c) the lesser of (x) the excess of (i) the Principal Distribution Amount
     over (ii) the amount distributed to the Class A Certificateholders in
     clause (ii) B. (a) above and to the Class M-1 Certificates in clause (ii)
     B. (b) above and (y) the Class M-2 Principal Distribution Amount to the
     Class M-2 Certificateholders, until the Class Certificate Balance thereof
     has been reduced to zero;

     (d) the lesser of (x) the excess of (i) the Principal Distribution Amount
     over (ii) the amount distributed to the Class A Certificateholders in
     clause (ii) B. (a) above, to the Class M-1 Certificates in clause (ii) B.
     (b) above and to the Class M-2 Certificates in clause (ii) B. (c) above and
     (y) the Class B Principal Distribution Amount to the Class B
     Certificateholders, until the Class Certificate Balance thereof has been
     reduced to zero;

     (iii) any amount remaining after the distributions in clauses (i) and (ii)
above shall be distributed in the following order of priority with respect to
the offered certificates in the related certificate group:

     (a) to fund the Extra Principal Distribution Amount for that distribution
     date to be paid as a component of the Principal Distribution Amount in the
     same order of priority as described in clause (ii) above;

     (b) to the holders of the Class M-1 Certificates, any Unpaid Interest
     Amounts for that class;

     (c) to the holders of the Class M-1 Certificates, any Unpaid Realized Loss
     Amount for that class;

     (d) to the holders of the Class M-2 Certificates, any Unpaid Interest
     Amounts for that class;


                                       48


     (e) to the holders of the Class M-2 Certificates, any Unpaid Realized Loss
     Amount for that class;

     (f) to the holders of the Class B Certificates, any Unpaid Interest Amounts
     for that class;

     (g) to the holders of the Class B Certificates, any Unpaid Realized Loss
     Amount for that class;

     (h) to the Excess Reserve Fund Account the amount of any Basis Risk Payment
     for such distribution date;

     (i) from funds on deposit in the Excess Reserve Fund Account, an amount
     equal to any Basis Risk CarryForward Amount with respect to the Adjustable
     Rate Certificates for such distribution date in the same order and priority
     in which Accrued Certificate Interest is allocated among those classes of
     certificates;

     (j) to the Class X Certificates those amounts as described in the pooling
     and servicing agreement; and

     (k) to the holders of the Class R Certificates, the remaining amount.

     If on any distribution date, after giving effect to all distributions of
principal as described above, the aggregate Class Certificate Balances of the
certificates in a certificate group exceeds the sum of (i) the aggregate Stated
Principal Balance of the mortgage loans in the related loan group and (ii) the
amounts, if any, on deposit in the related pre-funding account, the Class
Certificate Balance of the Subordinated Certificates (but not the Class A
Certificates) of that certificate group will be reduced, in inverse order of
seniority (beginning with the Class B Certificates) by an amount equal to that
excess, until that Class Certificate Balance is reduced to zero. That reduction
is referred to as an "Applied Realized Loss Amount."

     "Accrued Certificate Interest" for each class of offered certificates on
any distribution date shall equal the amount of interest accrued during the
related interest accrual period on the related Class Certificate Balance at the
related Pass-Through Rate.

     "Basic Principal Distribution Amount" means, with respect to either loan
group and any distribution date, the excess of (i) the Principal Remittance
Amount for that loan group for that distribution date over (ii) the Excess
Subordinated Amount, if any, for that loan group for that distribution date.

     "Class A Principal Distribution Amount" for a loan group is the excess of
(A) the aggregate Class Certificate Balance of the Class A Certificates for the
related certificate group immediately prior to that distribution date over (B)
the lesser of (x) approximately      % for loan group 1 and approximately     %
for loan group 2, of the aggregate Stated Principal Balances of the mortgage
loans in that loan group as of the last day of the related Remittance Period and
(y) the aggregate Stated Principal Balance of the mortgage loans in that loan
group as of the last day of the related Remittance Period minus $      for loan
group 1 and $      for loan group 2.


                                       49


     "Class B Principal Distribution Amount" for a loan group and with respect
to any distribution date is the excess of (i) the sum for the related
certificate group of (A) the aggregate Class Certificate Balance of the Class A
Certificates (after taking into account distribution of the Class A Principal
Distribution Amount for that distribution date), (B) the Class Certificate
Balance of the Class M-1 Certificates (after taking into account distribution of
the Class M-1 Principal Distribution Amount for that distribution date), (C) the
Class Certificate Balance of the Class M-2 Certificates (after taking into
account distribution of the Class M-2 Principal Distribution Amount for that
distribution date) and (D) the Class Certificate Balance of the Class B
Certificates immediately prior to that distribution date over (ii) the lesser of
(A) approximately      % for loan group 1 and approximately      % for loan
group 2, of the aggregate Stated Principal Balances of the mortgage loans in
that loan group as of the last day of the related Remittance Period and (B) the
aggregate Stated Principal Balance of the mortgage loans in that loan group as
of the last day of the related Remittance Period minus $        for loan group 1
and $        for loan group 2; provided, however, that with respect to any
distribution date on which the Class Certificate Balances of the related Class
A, Class M-1 and Class M-2 Certificates have been reduced to zero, the Class B
Principal Distribution Amount is the lesser of (x) the Class Certificate Balance
of the Class B Certificates and (y) the Principal Distribution Amount.

     "Class M-1 Principal Distribution Amount" for a loan group and with respect
to any distribution date is the excess of (i) the sum for the related
certificate group of (A) the aggregate Class Certificate Balance of the Class A
Certificates (after taking into account distribution of the Class A Principal
Distribution Amount for that distribution date) and (B) the Class Certificate
Balance of the Class M-1 Certificates immediately prior to that distribution
date over (ii) the lesser of (A) approximately      % for loan group 1 and
approximately      % for loan group 2, of the aggregate Stated Principal
Balances of the mortgage loans in that loan group as of the last day of the
related Remittance Period and (B) the aggregate Stated Principal Balance of the
mortgage loans in that loan group as of the last day of the related Remittance
Period minus $        for loan group 1 and $       for loan group 2.

     "Class M-2 Principal Distribution Amount" for a loan group and with respect
to any distribution date is the excess of (i) the sum for the related
certificate group of (A) the aggregate Class Certificate Balance of the Class A
Certificates (after taking into account distribution of the Class A Principal
Distribution Amount for that distribution date), (B) the Class Certificate
Balance of the Class M-1 Certificates (after taking into account distribution of
the Class M-1 Principal Distribution Amount for that distribution date) and (C)
the Class Certificate Balance of the Class M-2 Certificates immediately prior to
that distribution date over (ii) the lesser of (A) approximately      % for loan
group 1 and approximately      % for loan group 2, of the aggregate Stated
Principal Balances of the mortgage loans in that loan group as of the last day
of the related Remittance Period and (B) the aggregate Stated Principal Balance
of the mortgage loans in that loan group as of the last day of the related
Remittance Period minus $       for loan group 1 and $       for loan group 2.

     "Excess Subordinated Amount" is described in this prospectus supplement
under "--Overcollateralization Provisions."


                                       50


     "Extra Principal Distribution Amount" means, as of any distribution date
and either certificate group, the lesser of (x) the related Total Monthly Excess
Spread for that distribution date and (y) the related Subordination Deficiency
for that distribution date.

     "Principal Remittance Amount" means, with respect to any distribution date
and each loan group, to the extent of funds available therefor as described in
this prospectus supplement, the amount equal to the sum of the following amounts
(without duplication) with respect to the immediately preceding Remittance
Period: (i) each payment of principal on a mortgage loan in the related loan
group received during that Remittance Period, including all full and partial
principal prepayments and any advances of principal with respect to that
Remittance Period, (ii) the liquidation proceeds on the mortgage loans in the
related loan group allocable to principal actually collected by the master
servicer during the related Remittance Period, (iii) the portion of the purchase
price with respect to each deleted mortgage loan in the related loan group that
was repurchased during the related Remittance Period, (iv) the principal portion
of any Substitution Adjustment Amounts in connection with a substitution of a
mortgage loan in the related loan group as of that distribution date and (v) the
allocable portion of the proceeds received with respect to the termination of
the trust fund (to the extent they relate to principal).

     "Realized Loss" means, with respect to a liquidated mortgage loan, the
amount by which the remaining unpaid principal balance of the mortgage loan
exceeds the amount of net Liquidation Proceeds applied to the principal balance
of the related mortgage loan.

     "Senior Enhancement Percentage" means, with respect to each certificate
group and for any distribution date, the percentage obtained by dividing (x) the
sum of (i) the aggregate Class Certificate Balances of the Subordinated
Certificates of the related certificate group and (ii) the related Subordinated
Amount (in each case after taking into account the distributions of the related
Principal Distribution Amount for that distribution date) by (y) the aggregate
Stated Principal Balance of the mortgage loans in the related loan group as of
the last day of the related Remittance Period.

     "Senior Specified Enhancement Percentage" on any date of determination is
      % with respect to certificate group 1 and       % with respect to
certificate group 2.

     "60+ Day Delinquent Loan" means each mortgage loan with respect to which
any portion of a Scheduled Payment is, as of the last day of the prior
Remittance Period, 60 day or more past due (without giving effect to any grace
period) and all REO Property.

     "Specified Subordinated Amount" means, with respect to each loan group
prior to the Stepdown Date for the related certificate group, an amount equal to
      % for loan group 1 and       % for loan group 2, of the cut-off date
principal balance of the mortgage loans in the related loan group; with respect
to each loan group on and after the Stepdown Date for the related certificate
group, an amount equal to       % for loan group 1 and       % for loan group 2,
of the aggregate Stated Principal Balance of the mortgage loans in that loan
group as of the last day of the related Remittance Period, subject to a minimum
amount equal to       % for each loan group of the aggregate Stated Principal
Balance of the mortgage loans in that loan group as of the respective cut-off
dates, provided, however, that if, on any distribution date, a Trigger Event for
a certificate group has occurred, the Specified Subordinated Amount shall not


                                       51


be reduced to the applicable percentage of the then current aggregate Stated
Principal Balance of the mortgage loans in the related loan group until the
distribution date on which a Trigger Event for that certificate group is no
longer occurring.

     "Stated Principal Balance" means, as to any mortgage loan and Due Date, the
unpaid principal balance of that mortgage loan as of that Due Date as specified
in the amortization schedule at the time relating thereto, after giving effect
to (x) the principal portion of payments due on or before that Due Date whether
or not received from the related Mortgagor and (y) any principal prepayments and
Liquidation Proceeds received prior to the end of the Prepayment Period that
includes such Due Date.

     "Stepdown Date" means, with respect to each certificate group, the earlier
to occur of (a) the Class Certificate Balances of the related senior
certificates being reduced to zero and (b) the later to occur of (i) the
distribution date in       and (ii) the first distribution date on which the
Senior Enhancement Percentage (calculated for this purpose only after taking
into account distributions of principal on the mortgage loans in the related
loan group on the last day of the related Remittance Period but prior to any
applications of Principal Distribution Amount to the Certificates) is greater
than or equal to the related Senior Specified Enhancement Percentage.

     "Subordinated Amount" is described in this prospectus supplement under
"--Overcollateralization Provisions."

     "Subordinated Deficiency" is described in prospectus supplement under
"--Overcollateralization Provisions."

     "Subordination Reduction Amount" is described in prospectus supplement
under "--Overcollateralization Provisions."

     A "Trigger Event" with respect to each certificate group and a distribution
date after the Stepdown Date, exists if the quotient (expressed as a percentage)
of (x) the three month rolling average of 60+ Day Delinquent Loans for the
related loan group, as of the last day of the related Remittance Period, and (y)
the Stated Principal Balance of the mortgage loans in that loan group, as of the
last day of the related Remittance Period, equals or exceeds    % (in the case
of loan group 1) or    % (in the case of loan group 2) of the related Senior
Enhancement Percentage.

     "Total Monthly Excess Spread" as to either loan group and any distribution
date equals the excess, if any, of (x) the interest collected or advanced for
that loan group in the related Remittance Period over (y) the amounts paid
pursuant to clause (i) above under the fourth paragraph of "--Distributions of
Interest and Principal" to the classes of certificates in the related
certificate group.

     "Unpaid Interest Amounts" for any class of certificates and any
distribution date will equal the sum of (a) the excess of (i) the sum of the
Accrued Certificate Interest for that distribution date and any portion of
Accrued Certificate Interest from prior distribution dates remaining unpaid over
(ii) the amount in respect of interest on that class of certificates actually
distributed on the preceding distribution date and (b) 30 days' interest on that
excess at the applicable pass-through rate (to the extent permitted by
applicable law).


                                       52


     "Unpaid Realized Loss Amount" with respect to any class of Subordinated
Certificates and as to any distribution date, is the excess of (i) Applied
Realized Loss Amounts with respect to that class over (ii) the sum of all
distributions in reduction of Applied Realized Loss Amounts on all previous
distribution dates. Any amounts distributed to a class of Subordinated
Certificates in respect of any Unpaid Realized Loss Amount will not be applied
to reduce the Class Certificate Balance of that class.

     In the event that, on a particular distribution date, amounts applied in
the order described above are not sufficient to make a full distribution of the
interest entitlement on the certificates of the related certificate group,
interest will be distributed on each class of certificates of equal priority
based on the amount of interest that each class would otherwise have been
entitled to receive in the absence of a shortfall. Any unpaid amount will be
carried forward and added to the amount holders of each class of certificates
will be entitled to receive on the next distribution date. Such a shortfall
could occur, for example, if losses realized on the mortgage loans for the
related loan group were exceptionally high or were concentrated in a particular
month. See "--Overcollateralization Provisions" below for the meanings of
certain other defined terms used in this section.

CALCULATION OF ONE-MONTH LIBOR

     On each LIBOR Determination Date (as defined below), the trustee will
determine One-Month LIBOR for the next interest accrual period for the
adjustable rate certificates.

     "One-Month LIBOR" means, as of any LIBOR Determination Date, the London
interbank offered rate for one-month United States dollar deposits which appears
in the Moneyline Telerate Page 3750 as of 11:00 a.m., London time, on that date.
If the rate does not appear on Telerate Page 3750, the rate for that day will be
determined on the basis of the rates at which deposits in United States dollars
are offered by the Reference Banks at approximately 11:00 a.m. (London time), on
that day to prime banks in the London interbank market. The trustee will request
the principal London office of each of the Reference Banks to provide a
quotation of its rate. If at least two quotations are provided, the rate for
that day will be the arithmetic mean of the quotations (rounded upwards if
necessary to the nearest whole multiple of 1/16%). If fewer than two quotations
are provided as requested, the rate for that day will be the arithmetic mean of
the rates quoted by major banks in New York City, selected by the master
servicer, at approximately 11:00 a.m. (New York City time) on that day for loans
in United States dollars to leading European banks.

     "LIBOR Determination Date" means, with respect to any interest accrual
period, the second London business day preceding the commencement of that
interest accrual period. For purposes of determining One-Month LIBOR, a "London
business day" is any day on which dealings in deposits of United States dollars
are transacted in the London interbank market.

     "Telerate Page 3750" means the display page currently so designated on the
Moneyline Telerate Service (or any other page as may replace that page on that
service for the purpose of displaying comparable rates or prices) and "Reference
Banks" means leading banks selected by the master servicer and engaged in
transactions in Eurodollar deposits in the international Eurocurrency market.


                                       53


EXCESS RESERVE FUND ACCOUNT

     The "Basis Risk Payment" for any distribution date will be the sum of (1)
any Basis Risk CarryForward Amount and (2) the Required Reserve Amount for that
date, provided however that with respect to any distribution date the payment
cannot exceed the amount otherwise distributable on the Class X Certificates.

     If on any distribution date, the pass-through rate for any class of group 2
certificates is based upon the Group 2 WAC Cap, the excess of (i) the amount of
interest that class of certificates would have been entitled to receive on that
distribution date had the pass-through rate not been subject to the Group 2 WAC
Cap, up to the Group 2 Maximum Cap, over (ii) the amount of interest that class
of group 2 Certificates received on that distribution date based on the Group 2
WAC Cap, together with the unpaid portion of any excess from prior distribution
dates (and interest accrued thereon at the then applicable pass-through rate on
that class of group 2 certificates, without giving effect to the Group 2 WAC
Cap) is the "Basis Risk CarryForward Amount" on those classes of group 2
certificates. Any Basis Risk CarryForward Amount on any class of group 2
certificates will be paid on future distribution dates from and to the extent of
funds available therefor in the Excess Reserve Fund Account (as described in
this prospectus supplement). The ratings on the group 2 certificates do not
address the likelihood of the payment of any Basis Risk CarryForward Amount.

     The pooling and servicing agreement establishes an account (referred to as
the Excess Reserve Fund Account), which is held in trust, as part of the trust
fund, by the trustee. The Excess Reserve Fund Account will not be an asset of
any REMIC. Holders of each of the Adjustable Rate Certificates will be entitled
to receive payments from the Excess Reserve Fund Account pursuant to the pooling
and servicing agreement in an amount equal to any Basis Risk CarryForward Amount
for that class of Certificates. On the closing date, $    will be deposited into
the Excess Reserve Fund Account. Thereafter, if the Group 2 WAC Cap exceeds the
pass-through rate on the Class BV Certificates by less than     %, the amount to
be held in the Excess Reserve Fund Account (referred to as the Required Reserve
Amount) on any distribution date thereafter shall equal the greater of (i)     %
of the sum of the outstanding Class Certificate Balance of the Adjustable Rate
Certificates as of that distribution date and (ii) $        and shall be funded
from amounts otherwise to be paid to the Class X Certificates. Any distribution
by the trustee from amounts in the Excess Reserve Fund Account shall be made on
the applicable distribution date.

OVERCOLLATERALIZATION PROVISIONS

     The pooling and servicing agreement requires that the Total Monthly Excess
Spread, if any, with respect to each loan group on each distribution date be
applied as an accelerated payment of principal of the certificates of the
related certificate group, but only to the limited extent hereafter described.

     The application of Total Monthly Excess Spread to the payment of Extra
Principal Distribution Amount of the class or classes of certificates in a
certificate group then entitled to distributions of principal has the effect of
accelerating the amortization of those certificates relative to the amortization
of the related mortgage loans. The portion, if any, of the Available


                                       54


Funds not required to be distributed to holders of the offered certificates as
described above on any distribution date will, to the extent not otherwise
required to be held in the Excess Reserve Fund Account, be paid to the holders
of the Class X Certificates and will not be available on any future distribution
date to cover Extra Principal Distribution Amount, Unpaid Interest Amounts or
Applied Realized Losses.

     With respect to any distribution date and loan group, the excess, if any,
of (a) the aggregate Stated Principal Balances of the mortgage loans in that
loan group immediately following that distribution date plus the amount, if any,
on deposit in the related pre-funding account over (b) the Class Certificate
Balance of the offered certificates in the related certificate group as of that
date (after taking into account the payment of principal on those certificates
on that distribution date) is the "Subordinated Amount" for that certificate
group as of that distribution date. The pooling and servicing agreement requires
that the Total Monthly Excess Spread for a loan group be applied as an
accelerated payment of principal on the certificates in the related certificate
group then entitled to receive distributions of principal to the extent that the
Specified Subordinated Amount for that certificate group exceeds the
Subordinated Amount for that certificate group as of that distribution date (as
to either loan group, the excess is referred to as a Subordination Deficiency).
Any amount of Total Monthly Excess Spread actually applied as an accelerated
payment of principal with respect to a certificate group is an "Extra Principal
Distribution Amount2" for that certificate group. The required level of the
Subordinated Amount with respect to a distribution date and certificate group is
the "Specified Subordinated Amount." As described above, the Specified
Subordinated Amount with respect to a loan group may, over time, decrease,
subject to certain floors and triggers. If a Trigger Event occurs, the Specified
Subordinated Amount for a loan group may not "step down". Total Monthly Excess
Spread will then be applied to the payment in reduction of principal of the
class or classes of certificates in the related certificate group then entitled
to distributions of principal during the period that the related loan group is
unable to meet the performance tests described in the definition of "Trigger
Event."

     Subordination Reduction Amount. In the event that a Specified Subordinated
Amount is permitted to decrease or "step down" on a distribution date in the
future, or in the event that an Excess Subordinated Amount for a certificate
group otherwise exists, the pooling and servicing agreement provides that some
or all of the principal which would otherwise be distributed to the holders of
the certificates in the related certificate group on that distribution date will
(to the extent not otherwise required to be held in the Excess Reserve Fund
Account) be distributed to the Holders of the Class X Certificates on that
distribution date until the Excess Subordinated Amount is reduced to zero. This
has the effect of decelerating the amortization of the certificates in the
related certificate group relative to the amortization of the mortgage loans in
the related loan group, and of reducing the related Subordinated Amount. With
respect to a certificate group and any distribution date, the excess, if any, of
(a) the Subordinated Amount on that distribution date over (b) the Specified
Subordinated Amount is the "Excess Subordinated Amount" with respect to that
distribution date. If, on any distribution date, the Excess Subordinated Amount
is, or, after taking into account all other distributions to be made on that
distribution date, would be, greater than zero (i.e., the related Subordinated
Amount is or would be greater than the related Specified Subordinated Amount),
then any amounts relating to principal which would otherwise be distributed to
the holders of the certificates in the related certificate group on that
distribution date will (to the extent not otherwise required to be held in the
Excess Reserve Fund Account)


                                       55


instead be distributed to the holders of the Class X Certificates in an amount
equal to the lesser of (x) the related Excess Subordinated Amount and (y) the
Net Monthly Excess Cashflow for the related certificate group (referred to as
the Subordination Reduction Amount for that distribution date). The "Net Monthly
Excess Cashflow" for a loan group is the amount of Available Funds for such loan
group remaining after the amount necessary to maintain the Required Reserve
Amount has been deposited in the Excess Reserve Fund Account.

STRUCTURING ASSUMPTIONS

     The prepayment model used in this prospectus supplement represents an
assumed rate of prepayment each month relative to the then outstanding principal
balance of a pool of mortgage loans for the life of those mortgage loans. The
prepayment assumption does not purport to be a historical description of
prepayment experience or a prediction of the anticipated rate of prepayment of
any pool of mortgage loans, including the related mortgage loans. With respect
to the mortgage loans in loan group 1, a 100% prepayment assumption (PPC)
assumes conditional prepayment rates of 4.00% per annum of the then outstanding
principal balance of the mortgage loans in loan group 1 in the first month of
the life of the related mortgage loans and an additional 1.64% per annum in each
month thereafter until the twelfth month. Beginning in the twelfth month and in
each month thereafter during the life of the mortgage loans in loan group 1,
100% prepayment assumption assumes a conditional prepayment rate of 22.00% per
annum each month. 0% prepayment assumption assumes prepayment rates equal to 0%
of the prepayment assumption i.e., no prepayments. Correspondingly, 100%
prepayment assumption assumes prepayment rates equal to 100% of the prepayment
assumption, and so forth. The prepayment assumption with respect to loan group 2
assumes a Constant Prepayment Rate (CPR).

     Since the tables were prepared on the basis of the assumptions in the
following paragraph, there are discrepancies between the characteristics of the
actual mortgage loans and the characteristics of the mortgage loans assumed in
preparing the tables. Any discrepancy may have an effect upon the percentages of
the Certificate Principal Balances outstanding and weighted average lives of the
offered certificates set forth in the tables. In addition, since the actual
mortgage loans in the trust fund have characteristics which differ from those
assumed in preparing the tables set forth below, the distributions of principal
on the offered certificates may be made earlier or later than as indicated in
the tables.

     Unless otherwise specified, the information in the tables in this
prospectus supplement has been prepared on the basis of the following assumed
characteristics of the mortgage loans and the following additional assumptions
which collectively are the structuring assumptions:

     o    the assumed mortgage loans of each loan group are as set forth below;

     o    the closing date for the certificates occurs on          , 200[ ];

     o    distributions on the certificates are made on the 25th day of each
month, commencing on       , 200[ ], in accordance with the priorities described
in this prospectus supplement;

     o    the mortgage loans prepayment rates with respect to the mortgage loans
in loan group 1 are a multiple of the applicable prepayment assumption and with
respect to the mortgage loans in loan group 2 are constant percentages of CPR
each as stated in the tables below;


                                       56


     o    prepayments include 30 days' interest thereon;

     o    the optional termination is exercised (except with respect to the
          weighted average life to maturity);

     o    the Specified Subordinated Amount for each loan group is initially as
specified in this prospectus supplement and thereafter decreases in accordance
with the provisions in this prospectus supplement;

     o    with respect to loan group 2, (a) the mortgage rate for each mortgage
loan is adjusted on its next rate adjustment date (and on subsequent adjustment
dates, if necessary) to a rate equal to the Gross Margin plus the Index (subject
to the applicable periodic adjustment cap and maximum interest rate), (b) the
assumed level of six-month LIBOR is [    %] and of One-Year CMT is [    %] and
(c) the scheduled monthly payment on the mortgage loans is adjusted to equal a
fully amortizing payment;

     o    One-Month LIBOR remains constant at [     %];

     o    no defaults in the payment by mortgagors of principal of and interest
on the mortgage loans are experienced;

     o    scheduled payments on the mortgage loans are received on the first day
of each month commencing in the calendar month following the closing date and
are computed prior to giving effect to prepayments received on the last day of
the prior month;

     o    prepayments represent prepayments in full of individual mortgage loans
and are received on the last day of each month, commencing in the calendar month
in which the closing date occurs;

     o    the initial Class Certificate Balance of each class of certificates is
as set forth on the cover page hereof;

     o    interest accrues on each class of certificates at the applicable
interest rate set forth or described on the cover hereof; and

     o    all of the amounts on deposit in the pre-funding accounts are used to
purchase subsequent mortgage loans during the pre-funding period with a first
scheduled principal and interest payment due on      , 200[ ].

     While it is assumed that each of the mortgage loans prepays at the
specified constant percentages of the prepayment assumption, this is not likely
to be the case. Moreover, discrepancies exist between the characteristics of the
actual mortgage loans which will be delivered to the trustee and characteristics
of the mortgage loans assumed in preparing the tables in this prospectus
supplement.


                                       57


                                  LOAN GROUP 1

STATISTICAL CALCULATION INITIAL MORTGAGE LOANS AS OF THE CUT-OFF DATE



                                                                                       ORIGINAL
                                                                                     AMORTIZATION          REMAINING
                                               GROSS           ORIGINAL TERM           TERM TO               TERM
                         PRINCIPAL            COUPON            TO MATURITY            MATURITY           TO MATURITY
       GROUP           BALANCES ($)          RATE (%)           (IN MONTHS)          (IN MONTHS)          (IN MONTHS)
       -----           ------------          --------           -----------          -----------          -----------

















ASSUMED SUBSEQUENT MORTGAGE LOANS



                                                                                       ORIGINAL
                                                                                     AMORTIZATION          REMAINING
                                               GROSS           ORIGINAL TERM           TERM TO               TERM
                         PRINCIPAL            COUPON            TO MATURITY            MATURITY           TO MATURITY
       GROUP           BALANCES ($)          RATE (%)           (IN MONTHS)          (IN MONTHS)          (IN MONTHS)
       -----           ------------          --------           -----------          -----------          -----------

















                                       58


                                  LOAN GROUP 2

STATISTICAL CALCULATION INITIAL MORTGAGE LOANS AS OF THE CUT-OFF DATE



                                                               INITIAL                            ORIGINAL    REMAINING
                            GROSS                   MONTHS    PERIODIC    PERIODIC   LIFETIME       TERM         TERM
             PRINCIPAL      COUPON      GROSS      TO NEXT      RATE        RATE       RATE     TO MATURITY  TO MATURITY
  GROUP    BALANCES ($)    RATE (%)   MARGIN (%)    CHANGE     CAP (%)    CAP (%)     CAP (%)   (IN MONTHS)  (IN MONTHS)     INDEX
  -----    ------------    --------   ----------    ------     -------    -------     -------   -----------  -----------     -----













ASSUMED SUBSEQUENT MORTGAGE LOANS



                                                               INITIAL                           ORIGINAL    REMAINING
                             GROSS                   MONTHS    PERIODIC   PERIODIC   LIFETIME      TERM         TERM
             PRINCIPAL      COUPON        GROSS      TO NEXT     RATE       RATE       RATE     TO MATURITY TO MATURITY
  GROUP    BALANCES ($)    RATE (%)    MARGIN (%)    CHANGE     CAP(%)    CAP (%)     CAP (%)   (IN MONTHS) (IN MONTHS)     INDEX
  -----    ------------    --------    ----------    ------     ------    -------     -------   ----------- -----------     -----











OPTIONAL TERMINATION

     The master servicer will have the right to repurchase all remaining
mortgage loans and REO Properties and thereby effect early retirement of the
certificates on any distribution date (referred to as the "OPTIONAL TERMINATION
DATE") following the date on which the aggregate Stated Principal Balance of the
mortgage loans as of the last day of the related Remittance Period and REO
Properties first equals an amount less than 10% of the sum of the aggregate
principal balance of the mortgage loans as of [ ], 200[ ] and the aggregate
principal balance of any subsequent mortgage loans transferred to the trust fund
as of the respective cut-off date. If the


                                       59


master servicer exercises its option, the purchase price distributed with
respect to the certificates will be 100% of their then outstanding principal
balance and any unpaid accrued interest thereon at the applicable pass-through
rate (in each case subject to reduction as provided in the pooling and servicing
agreement if the purchase price is based in part on the appraised value of any
REO Properties and the appraised value is less than the Stated Principal Balance
of the mortgage loans) together with any Basis Risk Carry Over Amount.
Distributions on the certificates in respect of any optional termination will
first be paid as set forth under "Description of the Certificates--Distributions
of Interest and Principal" in this prospectus supplement. The proceeds from any
distribution may not be sufficient to distribute the full amount to which each
class of certificates is entitled if the purchase price is based in part on the
appraised value of any REO Property and the appraised value is less than the
Stated Principal Balance of the related mortgage loan.

THE TRUSTEE

     Deutsche Bank National Trust Company will be the trustee under the pooling
and servicing agreement. The depositor and the master servicer may maintain
other banking relationships in the ordinary course of business with Deutsche
Bank National Trust Company. Offered certificates may be surrendered at the
Corporate Trust Office of the trustee located at c/o DTC Transfer Services, 55
Water Street, Jeanette Park Entrance, New York, New York 10041, Attention:
Corporate Trust Administration. Certificateholders may access monthly statements
from the trustee's website located at https://www.corporatetrust.db.com/invr.
Certificateholders may obtain assistance in operating the website by calling the
trustee's investor relations desk at (800) 735-7777.

RESTRICTIONS ON TRANSFER OF THE CLASS R CERTIFICATES

     The Class R Certificates will be subject to the restrictions on transfer
described in the prospectus under "Federal Income Tax Consequences--Taxation of
Holders of Residual Interest Securities--Restrictions on Ownership and Transfer
of Residual Interest Securities." The pooling and servicing agreement provides
that the Class R Certificates (in addition to certain other classes of
certificates) may not be acquired by an ERISA Plan. See "ERISA Considerations"
in this prospectus supplement. Each Class R Certificate will contain a legend
describing the foregoing restrictions.

                  YIELD, PREPAYMENT AND MATURITY CONSIDERATIONS

GENERAL

     The effective yields to the holders of the Fixed Rate Certificates will be
lower than the yields otherwise produced by the applicable rate at which
interest is passed through to those holders and the purchase price of those
Certificates because monthly distributions will not be payable to those holders
until the 25th day (or, if that day is not a business day, the following
business day) of the month following the month in which interest accrues on the
mortgage loans (without any additional distribution of interest or earnings
thereon in respect of the delay).

     Each interest accrual period for the Adjustable Rate Certificates will
consist of the actual number of days elapsed from the distribution date
preceding the month of the applicable


                                       60


distribution date (or, in the case of the first interest accrual period, from
the closing date) through the day before the applicable distribution date.

DEFAULTS IN DELINQUENT PAYMENTS

     The yield to maturity of the offered certificates, and particularly the
Subordinated Certificates, will be sensitive to defaults on the mortgage loans
in the related loan group. If a purchaser of an offered certificate calculates
its anticipated yield based on an assumed rate of default and amount of losses
that is lower than the default rate and amount of losses actually incurred, its
actual yield to maturity will be lower than that so calculated. Holders of the
offered certificates may not receive reimbursement for Realized Losses in the
month following the occurrence of those losses. In general, the earlier a loss
occurs, the greater is the effect on an investor's yield to maturity. There can
be no assurance as to the delinquency, foreclosure or loss experience with
respect to the mortgage loans. Because the mortgage loans were underwritten in
accordance with standards less stringent than those generally acceptable to
Fannie Mae and Freddie Mac with regard to a borrower's credit standing and
repayment ability, the risk of delinquencies with respect to, and losses on, the
mortgage loans will be greater than that of mortgage loans underwritten in
accordance with Fannie Mae and Freddie Mac standards.

     In general, a "Realized Loss" means, with respect to a liquidated mortgage
loan, the amount by which the remaining unpaid principal balance of the mortgage
loan exceeds the amount of liquidation proceeds applied to the principal balance
of the related mortgage loan. A "liquidated mortgage loan" is a defaulted
mortgage loan as to which the master servicer has determined that all
recoverable liquidation and insurance proceeds have been received.

PREPAYMENT CONSIDERATIONS AND RISKS

     The rate of principal payments on the offered certificates, the aggregate
amount of distributions on the offered certificates and the yields to maturity
of the offered certificates will be related to the rate and timing of payments
of principal on the mortgage loans in the related loan group. The rate of
principal payments on the mortgage loans will in turn be affected by the
amortization schedules of the mortgage loans and by the rate of principal
prepayments (including for this purpose prepayments resulting from refinancing,
liquidations of the mortgage loans due to defaults, casualties or condemnations
and repurchases by the seller or master servicer). Because certain of the
mortgage loans contain prepayment penalties, the rate of principal payments may
be less than the rate of principal payments for mortgage loans which did not
have prepayment penalties. The fixed-rate mortgage loans are subject to the
"due-on-sale" provisions included therein. See "The Mortgage Pool" in this
prospectus supplement.

     Prepayments, liquidations and purchases of the mortgage loans in a loan
group (including any optional purchase by the master servicer of a defaulted
mortgage loan in that loan group and any optional repurchase of the remaining
mortgage loans in the trust fund in connection with the termination of the trust
fund, in each case as described in this prospectus supplement) will result in
distributions on the offered certificates in the related certificate group of
principal amounts which would otherwise be distributed over the remaining terms
of the mortgage loans. Since the rate of payment of principal on the mortgage
loans will depend on future events and a variety of other factors, no assurance
can be given as to that rate or the rate of principal prepayments. The


                                       61


extent to which the yield to maturity of a class of offered certificates may
vary from the anticipated yield will depend upon the degree to which that
offered certificate is purchased at a discount or premium, and the degree to
which the timing of payments thereon is sensitive to prepayments, liquidations
and purchases of the mortgage loans in the related loan group. Further, an
investor should consider the risk that, in the case of any offered certificate
purchased at a discount, a slower than anticipated rate of principal payments
(including prepayments) on the mortgage loans in the related loan group could
result in an actual yield to that investor that is lower than the anticipated
yield and, in the case of any offered certificate purchased at a premium, a
faster than anticipated rate of principal payments on the mortgage loans in the
related loan group could result in an actual yield to that investor that is
lower than the anticipated yield. In addition, the weighted average life of the
certificates will be affected by any prepayment resulting from the distribution
of amounts, if any, on deposit in the pre-funding account after the end of the
pre-funding period that are allocable to the related loan group.

     The rate of principal payments (including prepayments) on pools of mortgage
loans may vary significantly over time and may be influenced by a variety of
economic, geographic, social and other factors, including changes in mortgagors'
housing needs, job transfers, unemployment, mortgagors' net equity in the
mortgaged properties and servicing decisions. In general, if prevailing interest
rates were to fall significantly below the mortgage rates on the mortgage loans
in loan group 1, the mortgage loans could be subject to higher prepayment rates
than if prevailing interest rates were to remain at or above the mortgage rates
on the mortgage loans. Conversely, if prevailing interest rates were to rise
significantly, the rate of prepayments on the mortgage loans in loan group 1
would generally be expected to decrease. No assurances can be given as to the
rate of prepayments on the mortgage loans in stable or changing interest rate
environments.

     [All] of the mortgage loans in loan group 2 are ARMs. As is the case with
fixed rate mortgage loans, the ARMs may be subject to a greater rate of
principal prepayments in a low interest rate environment. For example, if
prevailing interest rates were to fall, Mortgagors with ARMs may be inclined to
refinance their ARMs with a fixed rate loan to "lock in" a lower interest rate.
The existence of the applicable Periodic Rate Cap and Maximum Rate also may
affect the likelihood of prepayments resulting from refinancings. In addition,
the delinquency and loss experience of the ARMs may differ from that on the
fixed rate mortgage loans because the amount of the monthly payments on the ARMs
are subject to adjustment on each Adjustment Date. In addition, a substantial
majority of the ARMs (the        Adjustable Mortgage Loans, the Adjustable
Mortgage Loans and the      Adjustable Mortgage Loans) will not have their
initial Adjustment Date until 2, 3 or 5 years after the origination thereof. The
prepayment experience of the      Adjustable Mortgage Loans, the      Adjustable
Mortgage Loans and the Adjustable Mortgage Loans may differ from that of the
other ARMs. The      Adjustable Mortgage Loans, the      Adjustable Mortgage
Loans and the      Adjustable Mortgage Loans may be subject to greater rates of
prepayments as they approach their initial Adjustment Dates even if market
interest rates are only slightly higher or lower than the Mortgage Rates on the
     Adjustable Mortgage Loans, the      Adjustable Mortgage Loans or the
Adjustable Mortgage Loans (as the case may be) as borrowers seek to avoid
changes in their monthly payments.

     As described under "The Mortgage Pool--Assignment of the Mortgage Loans" in
this prospectus supplement, with respect to up to 30% of the initial mortgage
loans, the depositor


                                       62


may deliver all or a portion of each related mortgage file to the trustee not
later than five business days after the closing date. Should the seller fail to
deliver all or a portion of any such related mortgage file to the depositor or
other designee of the depositor or, at the depositor's direction, to the trustee
within the time periods described under "The Mortgage Pool--Assignment of the
Mortgage Loans" in this prospectus supplement, the seller will be obligated to
repurchase the related mortgage loan from the trust fund or, in certain
circumstances, remove the mortgage loan from the trust fund and substitute in
its place another mortgage loan. Any repurchases pursuant to this provision
would have the effect of accelerating the rate of prepayments on the initial
mortgage loans.

     The pre-funding feature of the trust fund also presents a prepayment risk.
It is anticipated that the trust fund will use substantially all of the
pre-funded amount as the consideration for the acquisition of additional
mortgage loans during the funding period, although there can be no assurance
that all of such cash will be so used. If the amounts on deposit in the
pre-funding accounts have not been exchanged by the trust fund for mortgage
loans on or before the end of the funding period, then such remaining amounts in
the pre-funding accounts will be released by the trust fund as a prepayment of
the principal of the related Class A Certificates.

     The timing of changes in the rate of prepayments on the mortgage loans may
significantly affect an investor's actual yield to maturity, even if the average
rate of principal payments is consistent with an investor's expectation. In
general, the earlier a prepayment of principal on the mortgage loans, the
greater the effect on an investor's yield to maturity. The effect on an
investor's yield as a result 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 offered certificates may not be offset
by a subsequent like decrease (or increase) in the rate of principal payments.

ADJUSTABLE RATE CERTIFICATES

     Each interest accrual period for the Adjustable Rate Certificates will
consist of the actual number of days elapsed from the preceding distribution
date (or, in the case of the first distribution date, from the closing date)
through the day preceding the applicable distribution date. The pass-through
rate for each Class of Adjustable Rate Certificates will be adjusted by
reference to One-Month LIBOR, subject to the effects of the applicable
limitations described in this prospectus supplement.

     The pass-through rate for each class of Group 2 Certificates may be
calculated by reference to the adjusted net mortgage rates of the mortgage loans
in loan group 2, which are based on the applicable Loan Index. If the mortgage
loans bearing higher mortgage rates, either through higher margins or an
increase in the applicable Loan Index (and consequently, higher adjusted net
mortgage rates), were to prepay, the weighted average adjusted net mortgage rate
would be lower than otherwise would be the case. Changes in One-Month LIBOR may
not correlate with changes in either Loan Index. It is possible that a decrease
in either Loan Index, which would be expected to result in faster prepayments,
could occur simultaneously with an increased level of One-Month LIBOR. If the
sum of One-Month LIBOR plus the applicable pass-through margin for a class or
classes of group 2 certificates were to be higher than the Group 2 WAC Cap, the
pass-through rate on the related Group 2 Certificates would be lower


                                       63


than otherwise would be the case. Although holders of the Group 2 Certificates
are entitled to receive any Basis Risk CarryForward Amount from and to the
extent of funds available in the Excess Reserve Fund Account, there is no
assurance that those funds will be available or sufficient for those purposes.
The ratings of the Group 2 Certificates do not address the likelihood of the
payment of any Basis Risk CarryForward Amount.

FIXED RATE CERTIFICATES

     Each interest accrual period for the fixed-rate certificates for any
distribution date will be the calendar month preceding the month of that
distribution date. The pass-through rate for each class of fixed-rate
certificates is specified on the cover page of this prospectus supplement,
subject to the effects of the applicable limitations described in this
prospectus supplement.

     The pass-through rate for each class of Group 1 Certificates is subject to
the imposition of a pass-through rate cap equal to the weighted average adjusted
net mortgage rate on the group 1 mortgage loans and referred to in this
prospectus supplement as the Group 1 WAC Cap. If the group 1 mortgage loans
bearing higher mortgage rates were to prepay, the resulting group 1 weighted
average adjusted net mortgage rate would be lower than would otherwise be the
case. If the pass-through rate for any class of fixed-rate certificates (as
specified on the cover page of this prospectus supplement) were to be higher
than the Group 1 WAC Cap, the rate of interest actually paid on the related
Group 1 Certificates would be lower than would otherwise be the case.
Additionally, unlike with respect to the Group 2 certificateholders, there is no
provision by which a Group 1 Certificateholder's interest payment which has been
reduced by operation of the Group 1 WAC Cap on any distribution date will be
paid to such certificateholder from the excess funds on any future distribution
date.

OVERCOLLATERALIZATION PROVISIONS

     The operation of the overcollateralization provisions of the pooling and
servicing agreement will affect the weighted average lives of the offered
certificates and consequently the yields to maturity of those certificates.
Unless and until the Subordinated Amount equals the Specified Subordinated
Amount for a loan group, Total Monthly Excess Spread will be applied as
distributions of principal of the class or classes of certificates in the
related certificate group then entitled to distributions of principal, thereby
reducing the weighted average lives thereof. The actual Subordinated Amount for
a loan group may change from distribution date to distribution date producing
uneven distributions of Total Monthly Excess Spread. There can be no assurance
as to when or whether the Subordinated Amount will equal the Specified
Subordinated Amount.

     Total Monthly Excess Spread generally is a function of the excess of
interest collected or advanced on the mortgage loans over the interest required
to pay interest on the offered certificates and expenses at the expense rate.
Mortgage loans with higher adjusted net mortgage rates will contribute more
interest to the Total Monthly Excess Spread. Mortgage loans with higher adjusted
net mortgage rates may prepay faster than mortgage loans with relatively lower
adjusted net mortgage rates in response to a given change in market interest
rates. Any disproportionate prepayments of mortgage loans with higher adjusted
net mortgage rates may


                                       64


adversely affect the amount of Total Monthly Excess Spread available to make
accelerated payments of principal of the offered certificates in the related
certificate group.

     As a result of the interaction of the foregoing factors, the effect of the
overcollateralization provisions on the weighted average lives of the offered
certificates may vary significantly over time and from class to class.

SUBORDINATED CERTIFICATES

     The subordinated certificates provide credit enhancement for the senior
certificates in the related certificate group and may absorb losses on the
mortgage loans in the related loan group. The weighted average lives of, and the
yields to maturity on, the subordinated certificates, in reverse order of their
relative payment priorities will be progressively more sensitive to the rate and
timing of mortgagor defaults and the severity of ensuing losses on the mortgage
loans in the related loan group. If the actual rate and severity of losses on
the mortgage loans is higher than those assumed by a holder of a related
subordinated certificate, the actual yield to maturity on such holder's
certificate may be lower than the yield expected by such holder based on such
assumption. Realized losses on the mortgage loans in a loan group will reduce
the class certificate balance of the class of the related subordinated
certificates then outstanding with the lowest relative payment priority if and
to the extent that the aggregate class certificate balances of all classes of
certificates in a certificate group, following all distributions on a
distribution date exceeds the total principal balances of the related mortgage
loans. As a result of such reduction, less interest will accrue on such class of
subordinated certificates than would otherwise be the case.

     The Basic Principal Distribution Amount to be made to the holders of the
offered certificates include the net proceeds in respect of principal received
upon the liquidation of a related mortgage loan. If such net proceeds are less
than the unpaid principal balance of the liquidated mortgage loan, the total
principal balances of the mortgage loans in a loan group will decline more than
the aggregate class certificate balances of the related offered certificates,
thereby reducing the amount of the overcollateralization. If such difference is
not covered by the amount of the overcollateralization or excess interest, the
class of subordinated certificates then outstanding with the lowest relative
payment priority will bear such loss. In addition, the subordinated certificates
will not be entitled to any principal distributions prior to the related
Stepdown Date or during the continuation of a Trigger Event (unless all of the
certificates in the related certificate group with a higher relative payment
priority have been paid in full). Because each Trigger Event is based on the
delinquency, as opposed to the loss, experience on the related mortgage loans, a
holder of a subordinated certificate may not receive distributions of principal
for an extended period of time, even if the rate, timing and severity of
realized losses on the applicable mortgage loans is consistent with such
holder's expectations. Because of the disproportionate distribution of principal
of the senior certificates, depending on the timing of realized losses, the
subordinated certificates in the related certificate group may bear a
disproportionate percentage of the realized losses on the mortgage loans in the
related loan group.

     For all purposes, the Class B Certificates in each certificate group will
have the lowest payment priority of any class of subordinated certificates.


                                       65


ADDITIONAL INFORMATION

     The depositor filed certain yield tables and other computational materials
with respect to certain classes of the offered certificates with the Commission
in a report on Form 8-K. Such tables and materials were prepared by the
underwriters at the request of certain prospective investors, based on
assumptions provided by, and satisfying the special requirements of, those
prospective investors. Such tables and assumptions may be based on assumptions
that differ from the structuring assumptions. Accordingly, those tables and
other materials may not be relevant to or appropriate for investors other than
those specifically requesting them.

WEIGHTED AVERAGE LIVES OF THE OFFERED CERTIFICATES

     The weighted average life of an offered certificate is determined by (a)
multiplying the amount of the reduction, if any, of the Class Certificate
Balance of the certificate on each distribution date by the number of years from
the date of issuance to that distribution date, (b) summing the results and (c)
dividing the sum by the aggregate amount of the reductions in Class Certificate
Balance of the certificate referred to in clause (a).

     For a discussion of the factors which may influence the rate of payments
(including prepayments) of the mortgage loans, see "--Prepayment Considerations
and Risks" in this prospectus supplement and "Yield and Prepayment
Considerations" in the prospectus.

     In general, the weighted average lives of the offered certificates will be
shortened if the level of prepayments of principal of the mortgage loans in the
related loan group increases. However, the weighted average lives of the offered
certificates will depend upon a variety of other factors, including the timing
of changes in the rate of principal payments and the priority sequence of
distributions of principal of the classes of certificates. See "Description of
the Certificates--Distributions of Interest and Principal" in this prospectus
supplement.

     The interaction of the foregoing factors may have different effects on
various classes of offered certificates and the effects on any class may vary at
different times during the life of that class. Accordingly, no assurance can be
given as to the weighted average life of any class of offered certificates.
Further, to the extent the prices of the offered certificates represent
discounts or premiums to their respective original Class Certificate Balances,
variability in the weighted average lives of those classes of offered
certificates will result in variability in the related yields to maturity. For
an example of how the weighted average lives of the classes of offered
certificates may be affected at various constant percentages of the Prepayment
Assumption, see the Decrement Tables below.

DECREMENT TABLES

     The following tables indicate the percentages of the initial Class
Certificate Balances of the classes of offered certificates that would be
outstanding after each of the dates shown at various constant percentages of the
applicable Prepayment Assumption and the corresponding weighted average lives of
those classes. The tables have been prepared on the basis of the structuring
assumptions. It is not likely that (i) all of the mortgage loans will have the
characteristics assumed, (ii) all of the mortgage loans will prepay at the
constant percentages of the applicable prepayment assumption specified in the
tables or at any other constant rate or (iii)


                                       66


all of the mortgage loans will prepay at the same rate. 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 specified constant
percentages of the applicable prepayment assumption, even if the weighted
average remaining term to maturity of the mortgage loans is consistent with the
remaining terms to maturity of the mortgage loans specified in the structuring
assumptions.

PREPAYMENT SCENARIOS



                                 SCENARIO I          SCENARIO II         SCENARIO III        SCENARIO IV         SCENARIO V
                                 ----------          -----------         ------------        -----------         ----------

Loan Group I (% of PPC)              %                    %                    %                  %                   %
Loan Group II (% of CPR)             %                    %                    %                  %                   %


PERCENT OF INITIAL CLASS CERTIFICATE BALANCE OUTSTANDING*



                                    CLASS AF-1                       CLASS MF-1                       CLASS MF-2
                               PREPAYMENT SCENARIO              PREPAYMENT SCENARIO               PREPAYMENT SCENARIO
                         -------------------------------   ------------------------------- --------------------------------
DISTRIBUTION DATE          I     II    III    IV     V       I    II    III     IV     V     I      II    III    IV     V
                         ----- -----  -----  ----  -----  -----  ----- -----  -----  ----- -----  -----  -----  ----- -----

Initial Percentage       100   100    100    100   100    100    100   100    100    100   100    100    100    100   100










Weighted Average Life
to Maturity**

Weighted Average Life
to Call**


*Rounded to the nearest whole percentage.
**The weighed average life of a Certificate of any class is determined by (I)
multiplying the net reduction, if any, of the Certificate Principal Balance by
the number of years from the date of issuance of the Certificate to the related
distribution date, (ii) adding the results, and (iii) dividing them by the
aggregate of the net reductions of the certificate principal balance described
in (i) above.



            Percent of Initial Class Certificate Balance Outstanding*



                                     CLASS BF                        CLASS AV-1                       CLASS MV-1
                               PREPAYMENT SCENARIO              PREPAYMENT SCENARIO              PREPAYMENT SCENARIO
                         -------------------------------- -------------------------------  --------------------------------
DISTRIBUTION DATE          I     II    III    IV     V      I     II    III    IV     V      I     II    III     IV     V
-----------------        ----- ----   -----   ----  ----- ----- -----  -----  ----- -----  -----  ----- -----  ----   -----

Initial Percentage       100   100    100     100   100   100   100    100    100   100    100    100   100    100    100








                                       67




                                     CLASS BF                        CLASS AV-1                       CLASS MV-1
                               PREPAYMENT SCENARIO              PREPAYMENT SCENARIO              PREPAYMENT SCENARIO
                         -------------------------------- -------------------------------  --------------------------------
DISTRIBUTION DATE          I     II    III    IV     V      I     II    III    IV     V      I     II    III     IV     V
-----------------        ----- ----   -----   ----  ----- ----- -----  -----  ----- -----  -----  ----- -----  ----   -----

Initial Percentage       100   100    100     100   100   100   100    100    100   100    100    100   100    100    100







Weighted Average Life
to Maturity**

Weighted Average Life
to Call**


*Rounded to the nearest whole percentage
**The weighed average life of a Certificate of any class is determined by (I)
multiplying the net reduction, if any, of the Certificate Principal Balance by
the number of years from the date of issuance of the Certificate to the related
distribution date, (ii) adding the results, and (iii) dividing them by the
aggregate of the net reductions of the certificate principal balance described
in (i) above.



            Percent of Initial Class Certificate Balance Outstanding*



                                            CLASS MV-2                                        CLASS BV
                                       PREPAYMENT SCENARIO                               PREPAYMENT SCENARIO
                         -----------------------------------------------  -------------------------------------------------
DISTRIBUTION DATE            I        II       III       IV         V         I        II        III       IV         V
-----------------        --------  --------  --------  -------   -------  --------  --------  --------  -------   ---------

Initial Percentage       100       100       100         100       100    100       100       100       100       100








Weighted Average Life
to Maturity**

Weighted Average Life
to Call**


*Rounded to the nearest whole percentage
** The weighed average life of a Certificate of any class is determined by (I)
multiplying the net reduction, if any, of the Certificate Principal Balance by
the number of years from the date of issuance of the Certificate to the related
distribution date, (ii) adding the results, and (iii) dividing them by the
aggregate of the net reductions of the certificate principal balance described
in (i) above.


                                       68


LAST SCHEDULED DISTRIBUTION DATE

     The last scheduled distribution dates for each class of offered
certificates are as follows:



                                                                 LAST SCHEDULED
                                                               DISTRIBUTION DATE
                                                               -----------------

Class AF-1 Certificates
Class MF-1 Certificates
Class MF-2 Certificates
Class BF Certificates
Class AV-1 Certificates
Class MV-1 Certificates
Class MV-2 Certificates
Class BV Certificates
Class R Certificates


     The last scheduled distribution date for each class of offered certificates
is the date on which the initial Class Certificate Balance set forth on the
cover page hereof for that class would be reduced to zero. The last scheduled
distribution dates for all Classes except for the Class R Certificates have been
calculated on the basis of the structuring assumptions and the assumptions that
no prepayments are received on the mortgage loans and each monthly payment of
principal of and interest on the mortgage loans is timely received. The last
scheduled distribution date for the Class R Certificates is the month after the
month of the last scheduled payment of the latest maturing mortgage loan in the
trust fund.

     Because the rate of distributions in reduction of the Class Certificate
Balance of each class of offered certificates will depend on the rate of payment
(including prepayments) of the mortgage loans, the Class Certificate Balance of
each class could be reduced to zero significantly earlier or later than the last
scheduled distribution date. The rate of payments on the mortgage loans will
depend on their particular characteristics, as well as on prevailing interest
rates from time to time and other economic factors, and no assurance can be
given as to the actual payment experience of the mortgage loans. See
"--Prepayment Considerations and Risks" and "--Weighted Average Lives of the
Offered Certificates" in this prospectus supplement and "Yield and Prepayment
Considerations" in the prospectus.

                                 USE OF PROCEEDS

     The depositor will apply the net proceeds of the sale of the offered
certificates against the purchase price of the mortgage loans.

FEDERAL INCOME TAX CONSEQUENCES

GENERAL

     The Pooling and Servicing Agreement provides that the Trust Fund, exclusive
of the assets held in the Excess Reserve Fund Account and certain other accounts
specified in the


                                       69


pooling and servicing agreement, will comprise a "Lower Tier REMIC" and an
"Upper Tier REMIC" organized in two-tiered REMIC structure. Each Certificate,
other than the Class R Certificate, represents ownership of a regular interest
in the Upper Tier REMIC. The Class R Certificate will represent ownership of the
sole Class of residual interest in each of the Lower Tier REMIC and the Upper
Tier REMIC. In addition, each of the Adjustable Rate Certificates will represent
a beneficial interest in the right to receive payments from the Excess Reserve
Fund Account. Elections will be made to treat the Lower Tier REMIC and the Upper
Tier REMIC as a REMIC for federal income tax purposes.

     Upon the issuance of the Offered Certificates, Sidley Austin Brown & Wood
LLP ("Tax Counsel") will deliver its opinion to the effect that, assuming
compliance with the Pooling and Servicing Agreement, for federal income tax
purposes, the Lower Tier REMIC and the Upper Tier REMIC will each qualify as a
REMIC within the meaning of Section 860D of the Internal Revenue Code of 1986,
as amended (the "Code").

TAXATION OF REGULAR INTERESTS

     A holder of a Class of Offered Certificates, other than the Class R
Certificate, will be treated for federal income tax purposes as owning an
interest in the corresponding Class of Regular Interests in the Upper Tier
REMIC. In addition, the pooling and servicing agreement provides that each
holder of an Adjustable Rate Certificate will be treated as owning an interest
in a limited recourse interest rate cap contract (the "Cap Contracts"). A holder
of an Adjustable Rate Certificate must allocate its purchase price for the
Adjustable Rate Certificate between its components--the REMIC Regular Interest
component and the Cap Contract component. To the extent the Cap Contract
component has significant value, the Regular Interest component will be viewed
as having been issued with an additional amount of original issue discount
("OID") (which could cause the total amount of OID to exceed a statutorily
defined de minimis amount). See "Federal Income Tax Consequences--Taxation of
Debt Securities--Interest and Acquisition Discount" in the prospectus.

     Upon the sale, exchange, or other disposition of an Adjustable Rate
Certificate, the holder must allocate the amount realized between the components
of the Adjustable Rate Certificate based on the relative fair market values of
those components at the time of sale. Assuming that an Adjustable Rate
Certificate is held as a "capital asset" within the meaning of section 1221 of
the Code, gain or loss on the disposition of an interest in the Cap Contract
component should be capital gain or loss.

     Interest on the Regular Interest component of an Adjustable Rate
Certificate and on a Fixed Rate Certificate must be included in income by a
holder under the accrual method of accounting, regardless of the holder's
regular method of accounting. In addition, the Regular Interest components of
the Adjustable Rate Certificates and the Fixed Rate Certificates could be
considered to have been issued with OID. See "Federal Income Tax
Consequences--Taxation of Debt Securities--Interest and Acquisition Discount" in
the prospectus. The prepayment assumption that will be used in determining the
accrual of any OID, market discount, or bond premium, if any, will be a rate
equal to the Prepayment Assumption relating to each loan group. No
representation is made that the mortgage loans will prepay at such a rate or at
any other rate.




                                       70


OID must be included in income as it accrues on a constant yield method,
regardless of whether the holder receives currently the cash attributable to
such OID.

     The IRS has issued regulations under sections 1271 to 1275 of the Code,
addressing the treatment of debt instruments issued with OID. Purchasers of the
offered certificates should be aware that the OID regulations and section
1272(a)(6) of the Code do not adequately address particular issues relevant to,
or are not applicable to, securities such as the regular certificates.

     If the holders of any offered certificates are treated as holding those
certificates at a premium, those holders should consult their tax advisors
regarding the election to amortize bond premium and the method to be employed.

STATUS OF THE OFFERED CERTIFICATES

     The Regular Interest components of the Adjustable Rate Certificates and the
Fixed Rate Certificates will be treated as assets described in Section
7701(a)(19)(C) of the Code, and as "real estate assets" under Section
856(c)(5)(B) of the Code, generally, in the same proportion that the assets of
the Trust Fund, exclusive of the Basis Risk Reserve Fund, would be so treated.
In addition, to the extent the Regular Interest component of an Adjustable Rate
Certificate or Fixed Rate Certificate represents real estate assets under
section 856(c)(5)(B) of the Code, the interest derived from that component or
Certificate would be interest on obligations secured by interests in real
property for purposes of section 856(c)(3) of the Code. The Cap Contract
components of the Adjustable Rate Certificates will not, however, qualify as
assets described in Section 7701(a)(19)(C) of the Code or as real estate assets
under Section 856(c)(5)(B) of the Code.

THE CAP CONTRACT COMPONENT

     As indicated above, a portion of the purchase price paid by a holder to
acquire an Adjustable Rate Certificate will be attributable to the Cap Contract
component of such Certificate. The portion of the overall purchase price
attributable to the Cap Contract component must be amortized over the life of
such Certificate, taking into account the declining balance of the related
Regular Interest component. Treasury regulations concerning notional principal
contracts provide alternative methods for amortizing the purchase price of an
interest rate cap contract. Under one method--the level yield constant interest
method--the price paid for an interest rate cap is amortized over the life of
the cap as though it were the principal amount of a loan bearing interest at a
reasonable rate. Holders are urged to consult their tax advisors concerning the
methods that can be employed to amortize the portion of the purchase price paid
for the Cap Contract component of an Adjustable Rate Certificate.

     Any payments made to a holder from the Excess Reserve Fund Account will be
treated as periodic payments on an interest rate cap contract. To the extent the
sum of such periodic payments for any year exceeds that year's amortized cost of
the Cap Contract component, such excess is ordinary income. If for any year the
amount of that year's amortized cost exceeds the sum of the periodic payments,
such excess is allowable as an ordinary deduction.


                                       71


THE CLASS R CERTIFICATE

     The Class R Certificate represents ownership of the residual interest in
each of the Lower Tier REMIC and the Upper Tier REMIC. Accordingly, the holder
of the Class R Certificate must take into account the "daily portions" of REMIC
taxable income or net loss for each REMIC for each calendar quarter in
determining such holder's federal taxable income. Moreover, all or a significant
portion of the income attributable to the residual interests will be "excess
inclusions," which cannot be offset with otherwise allowable losses. For a more
thorough discussion of the tax consequences of owning a residual interest, see
"Federal Income Tax Consequences--Taxation of Holders of Residual Interest
Securities" in the prospectus.

     The residual interests represented by the Class R Certificate will likely
be treated as "noneconomic residual interests" within the meaning of Treasury
Regulations interpreting the REMIC provisions of the Code. Generally, a transfer
of a noneconomic residual interest will be disregarded and the transferor will
continue to be treated as the owner of the residual interest unless no
significant purpose of the transfer was to enable the transferor to impede the
assessment or collection of tax. The prospectus outlines these restrictions and
describes a safe harbor set out in Treasury Regulations under which transfers of
residual interests will be respected. See "Federal Income Tax
Consequences--Taxation of Holders of Residual Interest Securities--Restrictions
on Ownership and Transfer of Residual Interest Securities" in the prospectus.

     The Treasury Department has issued final regulations, effective May 11,
2004, that address the federal income tax treatment of "inducement fees"
received by transferees of noneconomic REMIC residual interests. The final
regulations require inducement fees to be included in income over a period
reasonably related to the period in which the related REMIC residual interest is
expected to generate taxable income or net loss allocable to the holder. The
final regulations provide two safe harbor methods that permit transferees to
include inducement fees in income either (i) in the same amounts and over the
same period that the taxpayer uses for financial reporting purposes, provided
that such period is not shorter than the period the REMIC is expected to
generate taxable income or (ii) ratably over the remaining anticipated weighted
average life of all the regular and residual interests issued by the REMIC,
determined based on actual distributions projected as remaining to be made on
such interests under the prepayment assumption. If the holder of a REMIC
residual interest sells or otherwise disposes of the Class R Certificate, any
unrecognized portion of the inducement fee must be taken into account at the
time of the sale or disposition. The final regulations also provide that an
inducement fee shall be treated as income from sources within the United States.
In addition, the IRS has issued administrative guidance addressing the
procedures by which transferees of noneconomic REMIC residual interests may
obtain automatic consent from the IRS to change the method of accounting for
REMIC inducement fee income to one of the safe harbor methods provided in these
final regulations (including a change from one safe harbor method to the other
safe harbor method). Prospective purchasers of the Class R Certificates should
consult with their tax advisors regarding the effect of these final regulations
and the related guidance regarding the procedures for obtaining automatic
consent to change the method of accounting.


                                       72


     For further information regarding the federal income tax consequences of
investing in the Offered Certificates, see "Federal Income Tax Consequences" in
the prospectus.

                              ERISA CONSIDERATIONS

     Any fiduciary of an employee benefit or other plan or arrangement (such as
an individual retirement plan or Keogh plan) that is subject to the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), or Section 4975 of
the Internal Revenue Code of 1986, as amended (the "Code") (a "Plan") that
proposes to cause the Plan to acquire any of the offered certificates should
consult with its counsel with respect to the potential consequences under ERISA
and/or Section 4975 of the Code, of the Plan's acquisition and ownership of
those Certificates. See "ERISA Considerations" in the prospectus. Section 406 of
ERISA and Section 4975 of the Code prohibit "parties in interest" (under ERISA)
and "disqualified persons" (under the Code) with respect to an employee benefit
or similar plan subject to ERISA and/or to the excise tax provisions set forth
under Section 4975 of the Code from engaging in certain transactions involving
that Plan and its assets unless a statutory, regulatory or administrative
exemption applies to the transaction. Section 4975 of the Code imposes certain
excise taxes on prohibited transactions involving Plans subject to that section;
ERISA authorizes the imposition of civil penalties for prohibited transactions
involving Plans not subject to the requirements of Section 4975 of the Code.

     Certain employee benefit plans, including governmental plans and certain
church plans, are not subject to ERISA's requirements. Accordingly, assets of
those plans may be invested in the offered certificates without regard to the
ERISA considerations described in this prospectus supplement and in the
prospectus, subject to the provisions of other applicable federal and state law.
Any plan that is qualified and exempt from taxation under Sections 401(a) and
501(a) of the Code may nonetheless be subject to the prohibited transaction
rules set forth in Section 503 of the Code.

     Except as noted above, investments by Plans are subject to ERISA's general
fiduciary requirements, including the requirement of investment prudence and
diversification and the requirement that a Plan's investments be made in
accordance with the documents governing the Plan. A fiduciary that decides to
invest the assets of a Plan in the offered certificates should consider, among
other factors, the extreme sensitivity of the investment to the rate of
principal payments (including prepayments) on the mortgage loans.

     [The U.S. Department of Labor has granted an individual administrative
exemption to [ ] (Prohibited Transaction Exemption [ ], Exemption Application
No. D-[ ], [ ] Fed. Reg. [ ] (referred to as the Exemption), from certain of the
prohibited transaction rules of ERISA and the related excise tax provisions of
Section 4975 of the Code with respect to the initial purchase, the holding and
the subsequent resale 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 Exemption applies to mortgage
loans such as the mortgage loans in the trust fund.]

     On July 21, 1997, the Department of Labor published in the Federal Register
an amendment to the Exemption, which extends exemptive relief to certain
mortgage-backed and


                                       73


asset-backed securities transactions using pre-funding accounts for trusts
issuing pass-through certificates. The amendment generally allows mortgage loans
or other secured receivables supporting payments to certificateholders, and
having a value equal to no more than twenty-five percent (25%) 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, instead of requiring that all such obligations be either
identified or transferred on or before the closing date. The relief is available
when certain conditions are met.

     For a general description of the Exemption and the conditions that must be
satisfied for the Exemption to apply, including the conditions that apply to any
pre-funding account, see "ERISA Considerations" in the prospectus.

     It is expected that the Exemption will apply to the acquisition and holding
by Plans of the Class A Certificates and that all conditions of the Exemption
other than those within the control of the investors will be met. In addition,
as of the date hereof, there is no single mortgagor that is the obligor on five
percent (5%) of the mortgage loans included in the trust fund by aggregate
unamortized principal balance of the assets of the trust fund.

     Because the characteristics of the Subordinated Certificates and the Class
R Certificates may not meet the requirements of the Exemption or any other
exemption issued under ERISA, the purchase and holding of the Subordinated
Certificates and the Class R Certificates by a Plan or by individual retirement
accounts or other plans subject to section 4975 of the Code may result in
prohibited transactions or the imposition of excise taxes or civil penalties.
Consequently, transfer of the Subordinated Certificates and the Class R
Certificates will not be registered by the trustee unless the trustee receives
the following:

     o    a representation from the transferee of that certificate, acceptable
to and in form and substance satisfactory to the trustee, to the effect that
that transferee is not a Plan, nor a person acting on behalf of any such plan or
arrangement nor using the assets of any such Plan to effect the transfer;

     o    if the purchaser is an insurance company, a representation that the
purchaser is an insurance company which is purchasing the certificates with
funds contained in an "insurance company general account" (as that term is
defined in section V(e) of Prohibited Transaction Class Exemption 95-60) and
that the purchase and holding of the certificates are covered under Sections I
and III of PTCE 95-60; or

     o    an opinion of counsel satisfactory to the trustee that the purchase
and holding of the certificate by a Plan, any person acting on behalf of a Plan
or using a Plan's assets, will not result in the assets of the trust fund being
deemed to be "plan assets" and subject to the prohibited transaction
requirements of ERISA and the Code and will not subject the trustee to any
obligation in addition to those undertaken in the agreement.

     This representation shall be deemed to have been made to the trustee by the
transferee's acceptance of a Subordinated Certificate. In the event that the
representation is violated, or any attempt to transfer to a plan or person
acting on behalf of a Plan or using a Plan's assets is attempted without the
opinion of counsel, the attempted transfer or acquisition shall be void and of
no effect.


                                       74


     Prospective Plan investors should consult with their legal advisors
concerning the impact of ERISA and the Code, the applicability of the Exemption,
as described in the prospectus, and the potential consequences in their specific
circumstances, prior to making an investment in the offered certificates.
Moreover, each Plan fiduciary should determine whether under the general
fiduciary standards of investment prudence and diversification, an investment in
the offered 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.

                             METHOD OF DISTRIBUTION

     Subject to the terms and conditions set forth in an underwriting agreement,
dated , 200[ ], and (referred to as the underwriters) have agreed to purchase,
and the depositor has agreed to sell to the underwriters, the principal amount
of the Offered Certificates set forth under their respective names.




                                       ------------------     --------------------

Class AF-1                               $                     $
Class MF-1
Class MF-2
Class BF
Class AV-1
Class MV-1
Class MV-2
Class BV
Class R


     The depositor has been advised that the underwriters propose initially to
offer the offered certificates, other than the Class R Certificates, to certain
dealers at the prices set forth on the cover page of this prospectus supplement
less a selling concession not to exceed the percentage of the certificate
denomination set forth below, and that the underwriters may allow, and such
dealers may reallow, a reallowance discount not to exceed the percentage of the
certificate denomination set forth below:



                                       SELLING CONCESSION     REALLOWANCE DISCOUNT
                                       ------------------     --------------------

Class AF-1                                           %                      %
Class MF-1                                           %                      %
Class MF-2                                           %                      %
Class BF                                             %                      %
Class AV-1                                           %                      %
Class MV-1                                           %                      %
Class MV-2                                           %                      %
Class BV                                             %                      %



                                       75


     After the initial public offering, the public offering prices, such
concessions and such discounts may be changed.

     Each underwriter intends to make a secondary market in each class of the
offered certificates purchased by it, but no underwriter has any 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 or that
it will provide certificateholders with a sufficient level of liquidity of
investment.

     Until the distribution of the offered certificates is completed, rules of
the Securities and Exchange Commission may limit the ability of the underwriters
and certain selling group members to bid for and purchase the offered
certificates. As an exception to the rules, the underwriters are permitted to
engage in certain transactions that stabilize the price of the offered
certificates other than the Class R Certificates. Such transactions consist of
bids or purchases for the purpose of pegging, fixing or maintaining the price of
the offered certificates other than the Class R Certificates.

     In general, purchases of a security for the purpose of stabilization or to
reduce a short position could cause the price of the security to be higher than
it might be in the absence of such purchases.

     Neither the depositor nor either of the underwriters makes any
representation or prediction as to the direction or magnitude of any effect that
the transactions described above may have on the prices of the offered
certificates other than the Class R Certificates. In addition, neither the
depositor nor either of the underwriters makes any representation that the
underwriters will engage in such transactions or that such transactions, once
commenced, will not be discontinued without notice.

     The Class R Certificates will be purchased by            and may be offered
from time to time in negotiated transactions or otherwise at varying prices to
be determined at the time of sale. There will be no proceeds to the depositor
from the sale of the Class R Certificates.

     The depositor has agreed to indemnify the underwriters against, or make
contributions to the underwriters with respect to, certain liabilities,
including liabilities under the Securities Act of 1933, as amended.

                                  LEGAL MATTERS

     The validity of the certificates, including certain federal income tax
consequences with respect thereto, will be passed upon for the depositor by
Sidley Austin Brown & Wood LLP, New York, New York.         New York, New York,
will pass upon certain legal matters on behalf of the underwriters.

                                     RATINGS

     It is a condition to the issuance of the Class A Certificates that they be
rated      by        and by         . It is a condition to the issuance of the
Class R Certificates that they be rated at least     by         and           .
It is a condition to the issuance of the Class M-1, Class M- 2 and


                                       76


Class B Certificates that they be rated at least    ,and       , respectively,
by         and         .

     The ratings assigned by       to mortgage pass-through certificates address
the likelihood of the receipt of all distributions on the mortgage loans by the
related        certificateholders under the agreements pursuant to which the
certificates are issued,          's ratings take into consideration the credit
quality of the related mortgage pool, including any credit support providers,
structural and legal aspects associated with the certificates, and the extent to
which the payment stream on that mortgage pool is adequate to make payments
required by the certificates.            's ratings on the certificates do not,
however, constitute a statement regarding frequency of prepayments on the
related mortgage loans.

     The ratings of the rating agencies do not address the possibility that, as
a result of principal prepayments, certificateholders may receive a lower than
anticipated yield. The ratings on the adjustable rate certificates do not
address the likelihood of payment of any Basis Risk CarryForward Amount.

     The ratings assigned to the offered certificates should be evaluated
independently from similar ratings on other types of securities. A 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 any other rating
agency. The rating assigned by another rating agency to the offered certificates
could be lower than the respective ratings assigned by the rating agencies.


                                       77


                                                                         ANNEX I

                      GLOBAL CLEARANCE, SETTLEMENT AND TAX
                            DOCUMENTATION PROCEDURES

     Except in certain limited circumstances, the globally offered Home Equity
Mortgage Loan Asset-Backed Certificates, Series SPMD 200[ ]-      (the "Global
Securities") will be available only in book-entry form. Investors in the Global
Securities may hold such Global Securities through any of The Depository Trust
Company ("DTC"), Clearstream, Luxembourg or Euroclear. The Global Securities
will be tradable as home market instruments in both the European and U.S.
domestic markets. Initial settlement and all secondary trades will settle in
same-day funds.

     Secondary market trading between investors holding Global Securities
through Clearstream, Luxembourg and Euroclear will be conducted in the ordinary
way in accordance with their normal rules and operating procedures and in
accordance with conventional Eurobond practice (i.e., seven calendar day
settlement).

     Secondary market trading between investors holding Global Securities
through DTC will be conducted according to the rules and procedures applicable
to U.S. corporate debt obligations and prior mortgage pass-through certificate
issues.

     Secondary cross-market trading between Clearstream, Luxembourg or Euroclear
and DTC Participants holding Certificates will be effected on a
delivery-against-payment basis through the respective Depositaries of
Clearstream, Luxembourg and Euroclear (in such capacity) and as DTC
Participants.

     Non-U.S. holders (as described below) of Global Securities will be subject
to U.S. withholding taxes unless such holders meet certain requirements and
deliver appropriate U.S. tax documents to the securities clearing organizations
or their participants.

INITIAL SETTLEMENT

     All Global Securities will be held in book-entry form by DTC in the name of
Cede & Co. as nominee of DTC. Investors' interests in the Global Securities will
be represented through financial institutions acting on their behalf as direct
and indirect Participants in DTC. As a result, Clearstream, Luxembourg and
Euroclear will hold positions on behalf of their participants through their
respective Depositaries, which in turn will hold such positions in accounts as
DTC Participants.

     Investors electing to hold their Global Securities through DTC will follow
the settlement practices applicable to prior mortgage pass-through certificate
issues. Investor securities custody accounts will be credited with their
holdings against payment in same-day funds on the settlement date.

     Investors electing to hold their Global Securities through Clearstream,
Luxembourg or Euroclear accounts will follow the settlement procedures
applicable to conventional Eurobonds, except that there will be no temporary
global security and no "lock-up" or restricted period.


                                       78


Global Securities will be credited to the securities custody accounts on the
settlement date against payment in same-day funds.

SECONDARY MARKET TRADING

     Since the purchaser determines the place of delivery, it is important to
establish at the time of the trade where both the purchaser's and seller's
accounts are located to ensure that settlement can be made on the desired value
date.

     Trading between DTC Participants. Secondary market trading between DTC
Participants will be settled using the procedures applicable to prior mortgage
pass-through certificate issues in same-day funds.

     Trading between Clearstream, Luxembourg and/or Euroclear Participants.
Secondary market trading between Clearstream, Luxembourg Participants or
Euroclear Participants will be settled using the procedures applicable to
conventional Eurobonds in same-day funds.

     Trading between DTC Seller and Clearstream, Luxembourg or Euroclear
Purchaser. When Global Securities are to be transferred from the account of a
DTC Participant to the account of a Clearstream, Luxembourg Participant or a
Euroclear Participant, the purchaser will send instructions to Clearstream,
Luxembourg or Euroclear through a Clearstream, Luxembourg Participant or
Euroclear Participant at least one business day prior to settlement.
Clearstream, Luxembourg or Euroclear will instruct the respective Depositary, as
the case may be, to receive the Global Securities against payment. Payment will
include interest accrued on the Global Securities from and including the last
coupon payment date to and excluding the settlement date, on the basis of either
the actual number of days in such accrual period and a year assumed to consist
of 360 days or a 360-day year of twelve 30-day months, as applicable to the
related Class of Global Securities. For transactions settling on the 31st of the
month, payment will include interest accrued to and excluding the first day of
the following month. Payment will then be made by the respective Depositary of
the DTC Participant's account against delivery of the Global Securities. After
settlement has been completed, the Global Securities will be credited to the
respective clearing system and by the clearing system, in accordance with its
usual procedures, to the Clearstream, Luxembourg Participant's or Euroclear
Participant's account. The securities credit will appear the next day (European
time) and the cash debt will be back-valued to, and the interest on the Global
Securities will accrue from, the value date (which would be the preceding day
when settlement occurred in New York). If settlement is not completed on the
intended value date (i.e., the trade fails), the Clearstream, Luxembourg or
Euroclear cash debt will be valued instead as of the actual settlement date.

     Clearstream, Luxembourg Participants and Euroclear Participants will need
to make available to the respective clearing systems the funds necessary to
process same-day funds settlement. The most direct means of doing so is to
preposition funds for settlement, either from cash on hand or existing lines of
credit, as they would for any settlement occurring within Clearstream,
Luxembourg or Euroclear. Under this approach, they may take on credit exposure
to Clearstream, Luxembourg or Euroclear until the Global Securities are credited
to their accounts one day later.


                                       79


     As an alternative, if Clearstream, Luxembourg or Euroclear has extended a
line of credit to them, Clearstream, Luxembourg Participants or Euroclear
Participants can elect not to preposition funds and allow that credit line to be
drawn upon the finance settlement. Under this procedure, Clearstream, Luxembourg
Participants or Euroclear Participants purchasing Global Securities would incur
overdraft charges for one day, assuming they cleared the overdraft when the
Global Securities were credited to their accounts. However, interest on the
Global Securities would accrue from the value date. Therefore, in many cases the
investment income on the Global Securities earned during that one-day period may
substantially reduce or offset the amount of such overdraft charges, although
this result will depend on each Clearstream, Luxembourg Participant's or
Euroclear Participant's particular cost of funds.

     Since the settlement is taking place during New York business hours, DTC
Participants can employ their usual procedures for sending Global Securities to
the respective European Depositary for the benefit of Clearstream, Luxembourg
Participants or Euroclear Participants. The sale proceeds will be available to
the DTC seller on the settlement date. Thus, to the DTC Participants a
cross-market transaction will settle no differently than a trade between two DTC
Participants.

     Trading between Clearstream, Luxembourg or Euroclear Seller and DTC
Purchaser. Due to time zone differences in their favor, Clearstream, Luxembourg
Participants and Euroclear Participants may employ their customary procedures
for transactions in which Global Securities are to be transferred by the
respective clearing system, through the respective Depositary, to a DTC
Participant. The seller will send instructions to Clearstream, Luxembourg or
Euroclear through a Clearstream, Luxembourg Participant or Euroclear Participant
at least one business day prior to settlement. In these cases Clearstream,
Luxembourg or Euroclear will instruct the respective Depositary, as appropriate,
to deliver the Global Securities to the DTC Participant's account against
payment. Payment will include interest accrued on the Global Securities from and
including the last coupon payment to and excluding the settlement date on the
basis of either the actual number of days in such accrual period and a year
assumed to consist of 360 days or a 360-day year of twelve 30-day months, as
applicable to the related Class of Global Securities. For transactions settling
on the 31st of the month, payment will include interest accrued to and excluding
the first day of the following month. The payment will then be reflected in the
account of the Clearstream, Luxembourg Participant or Euroclear Participant the
following day, and receipt of the cash proceeds in the Clearstream, Luxembourg
Participant's or Euroclear Participant's account would be back-valued to the
value date (which would be the preceding day, when settlement occurred in New
York). Should the Clearstream, Luxembourg Participant or Euroclear Participant
have a line of credit with its respective clearing system and elect to be in
debt in anticipation of receipt of the sale proceeds in its account, the
back-valuation will extinguish any overdraft incurred over that one-day period.
If settlement is not completed on the intended value date (i.e., the trade
fails), receipt of the cash proceeds in the Clearstream, Luxembourg
Participant's or Euroclear Participant's account would instead be valued as of
the actual settlement date.

     Finally, day traders that use Clearstream, Luxembourg or Euroclear and that
purchase Global Securities from DTC Participants for delivery to Clearstream,
Luxembourg Participants or Euroclear Participants should note that these trades
would automatically fail on the sale side


                                       80


unless affirmative action were taken. At least three techniques should be
readily available to eliminate this potential problem:

     (a) borrowing through Clearstream, Luxembourg or Euroclear for one day
(until the purchase side of the day trade is reflected in their Clearstream,
Luxembourg or Euroclear accounts) in accordance with the clearing system's
customary procedures;

     (b) borrowing the Global Securities in the U.S. from a DTC Participant no
later than one day prior to settlement, which would give the Global Securities
sufficient time to be reflected in their Clearstream, Luxembourg or Euroclear
account in order to settle the sale side of the trade; or

     (c) staggering the value dates for the buy and sell sides of the trade so
that the value date for the purchase from the DTC Participant is at least one
day prior to the value date for the sale to the Clearstream, Luxembourg
Participant or Euroclear Participant.

CERTAIN U.S. FEDERAL INCOME TAX DOCUMENTATION REQUIREMENTS

     A beneficial owner of Global Securities holding securities through
Clearstream, Luxembourg or Euroclear (or through DTC if the holder has an
address outside the U.S.) will be subject to the 30% U.S. withholding tax that
generally applies to payments of interest (including original issue discount) on
registered debt issued by U.S. Persons, unless (i) each clearing system, bank or
other financial institution that holds customers securities in the ordinary
course of its trade or business in the chain of intermediaries between such
beneficial owner and the U.S. entity required to withhold tax complies with
applicable certification requirements and (ii) such beneficial owner takes one
of the following steps to obtain an exemption or reduced tax rate:

     Exemption for non-U.S. Persons (Form W-8BEN). Certificate Owners of Global
     Securities that are non-U.S. Persons can obtain a complete exemption from
     the withholding tax by filing a signed Form W-8BEN (Certificate of Foreign
     Status of Beneficial Owner for United States Tax Withholding). Non-U.S.
     Persons that are Certificate Owners residing in a country that has a tax
     treaty with the United States can obtain an exemption or reduced tax rate
     (depending on the treaty terms) by filing Form W-8BEN (Certificate of
     Foreign Status of Beneficial Owner for United States Tax Withholding). If
     the information shown on Form W-8BEN changes, a new Form W-8BEN must be
     filed within 30 days of such change.

     Exemption for non-U.S. Persons with effectively connected income (Form
     W-8ECI). A non-U.S. Person, including a non-U.S. corporation or bank with a
     U.S. branch, for which the interest income is effectively connected with
     its conduct of a trade or business in the United States, can obtain an
     exemption from the withholding tax by filing Form W-8ECI (Certificate of
     Foreign Person's Claim for Exemption from Withholding on Income Effectively
     Connected with the Conduct of a Trade or Business in the United States).

     Exemptions for U.S. Persons (Form W-9). U.S. Persons can obtain a complete
     exemption from the withholding tax by filing Form W-9 (Payer's Request for
     Taxpayer Identification Number and Certification),


                                       81


     U.S. Federal Income Tax Reporting Procedure. The Certificate Owner of a
     Global Security files by submitting the appropriate form to the person
     through whom it holds (the clearing agency, in the case of persons holding
     directly on the books of the clearing agency). Form W-8BEN and Form W-8ECI
     are effective until the third succeeding calendar year from the date such
     form is signed.

     The term "U.S. PERSON" means (i) a citizen or resident of the United
States, (ii) a corporation, partnership or other entity treated as a corporation
or partnership for United States federal income tax purposes organized in or
under the laws of the United States or any state thereof or the District of
Columbia (unless, in the case of a partnership, Treasury regulations provide
otherwise) or (iii) an estate the income of which is includible in gross income
for United States tax purposes, regardless of its source, or (iv) a trust if a
Court within the United States is able to exercise primary supervision over the
administration of the trust and one or more United States persons have authority
to control all substantial decisions of the trust. Notwithstanding the preceding
sentence, to the extent provided in Treasury regulations, certain trusts in
existence on August 20, 1996, and treated as United States persons prior to such
date, that elect to continue to be treated as United States persons will also be
a U.S. Person. This summary does not deal with all aspects of U.S. Federal
income tax withholding that may be relevant to foreign holders of the Global
Securities. Investors are advised to consult their own tax advisors for specific
tax advice concerning their holding and disposing of the Global Securities.


                                       82


                             INDEX OF DEFINED TERMS


_______ Adjustable Mortgage Loans.............................................9
60+ Day Delinquent Loan......................................................48
Accrued Certificate Interest.................................................46
Adjustable Mortgage Loans.....................................................9
Adjustment Date...............................................................9
advance......................................................................38
Applied Realized Loss Amount.................................................46
Available Funds..............................................................38
Basic Principal Distribution Amount..........................................46
Basis Risk CarryForward Amount...............................................51
Basis Risk Payment...........................................................51
Cap Contracts................................................................67
capital asset................................................................67
Class A Principal Distribution Amount........................................46
Class B Principal Distribution Amount........................................46
Class Certificate Balance....................................................40
Class M-1 Principal Distribution Amount......................................47
Class M-2 Principal Distribution Amount......................................47
Class X Certificates.........................................................39
Code.........................................................................67
Collateral Value.............................................................12
Combined Loan-to-Value Ratio.................................................12
Compensating Interest........................................................37
conventional non-conforming mortgage loans...................................32
CPR..........................................................................53
cut-off date pool principal balance..........................................35
Delayed Delivery Loans.......................................................30
deleted mortgage loan........................................................30
Depository...................................................................40
determination date...........................................................38
disqualified persons.........................................................69
distribution account.........................................................41
distribution date............................................................42
DTC..........................................................................75
Due Date......................................................................8
electronic Mortgage Information and Transaction System.......................33
ERISA........................................................................69
Euroclear....................................................................40
event of default.............................................................38
Excess Reserve Fund Account..................................................51
Excess Subordinated Amount...................................................47
Extra Principal Distribution Amount..........................................47
FDIC..........................................................................5
FICO Credit Scores...........................................................12




First Federal................................................................34
Full/Alternate Documentation Program.........................................33
Global Securities............................................................75
Group 1 Class A Certificates.................................................39
Group 1 Mezzanine Certificates...............................................39
Group 1 Subordinated Certificates............................................39
Group 1 WAC Cap..............................................................61
Group 1 WAC Cap...............................................................3
Group 2 Class A Certificates.................................................39
Group 2 Maximum Cap..........................................................43
Group 2 Mezzanine Certificates...............................................39
Group 2 Subordinated Certificates............................................39
Group 2 WAC Cap..............................................................43
Group 2 WAC Cap...............................................................3
Holdings.....................................................................34
Index.........................................................................9
IndyMac Bank..................................................................7
Initial Rate Adjustment Date..................................................8
insurance company general account............................................71
insurance proceeds...........................................................41
interest accrual period......................................................61
last scheduled distribution date.............................................66
LIBOR Determination Date.....................................................50
liquidated mortgage loan.....................................................58
liquidation proceeds.........................................................41
Loan Index....................................................................3
Loan-to-Value Ratio..........................................................12
Lower Tier REMIC.............................................................67
Maximum Rate.................................................................10
Net Monthly Excess Cashflow..................................................53
New Proposed Regulations.....................................................69
No Doc Program...............................................................34
No Ratio Program.............................................................34
OID..........................................................................67
One-Month LIBOR..............................................................50
Optional Termination Date....................................................57
parties in interest..........................................................69
pass-through margin..........................................................43
Performance Loans............................................................10
Periodic Rate Cap.............................................................9
Plan.........................................................................69
plan assets..................................................................71
Prepayment Penalty Period.....................................................8
Principal Distribution Amount................................................43
Principal Remittance Amount..................................................47
Prohibited Transaction Class Exemption 95-60.................................71


                                       2


PTCE 95-60...................................................................71
real estate assets...........................................................68
Realized Loss................................................................48
Reduced Documentation Program................................................34
Reference Banks..............................................................50
Refinance Loan...............................................................12
Remittance Period............................................................37
replacement mortgage loan....................................................30
Required Reserve Amount......................................................51
Residual Certificates........................................................39
scheduled payments............................................................8
Senior Enhancement Percentage................................................48
Senior Specified Enhancement Percentage......................................48
Specified Subordinated Amount................................................48
Stated Principal Balance.....................................................48
Stated Principal Balances.....................................................8
Stepdown Date................................................................49
Subordinated Amount..........................................................49
Subordinated Deficiency......................................................49
Subordination Deficiency.....................................................52
Subordination Reduction Amount...............................................49
subprime mortgage loans......................................................32
Substitution Adjustment Amount...............................................30
Tax Counsel..................................................................67
Telerate Page 3750...........................................................50
Total Monthly Excess Spread..................................................49
Trigger Event................................................................49
U.S. Person..................................................................79
underwriters.................................................................71
Unpaid Interest Amounts......................................................49
Unpaid Realized Loss Amount..................................................49
Upper Tier REMIC.............................................................67


                                       3


                  HOME EQUITY MORTGAGE LOAN ASSET-BACKED TRUST,
                               SERIES SPMD 200[ ]-

                                     Issuer


                                INDYMAC ABS, INC.

                                    Depositor


                                 GRAPHIC OMITTED
                         IGT: "72643indymacbanklogo.eps"

                           Seller and Master Servicer


                                        $


              HOME EQUITY MORTGAGE LOAN ASSET-BACKED CERTIFICATES,
                             SERIES SPMD 200[ ]-


                              PROSPECTUS SUPPLEMENT


                              [NAME OF UNDERWRITER]
                              [NAME OF UNDERWRITER]



You should rely only on the information contained or incorporated by reference
in this prospectus supplement and the accompanying prospectus. We have not
authorized anyone to provide you with different information.

We are not offering the Series SPMD 200[ ]-     Home Equity Mortgage Loan
Asset-Backed Certificates in any state where the offer is not permitted.

Dealers will deliver a prospectus supplement and prospectus when acting as
underwriters of the Series SPMD 200[ ]-     Home Equity Loan Asset-Backed
Certificates and with respect to their unsold allotments or subscriptions. In
addition, all dealers selling the Series SPMD 200[ ]-     Home Equity Mortgage
Loan Asset-Backed Certificates will be required to deliver a prospectus
supplement and prospectus until     , 200[ ].

                                        , 200[ ]

                 SUBJECT TO COMPLETION DATED SEPTEMBER 10, 2004


PROSPECTUS
                                INDYMAC ABS, INC.
                                    DEPOSITOR

                            ASSET BACKED CERTIFICATES
                               ASSET BACKED NOTES
                              (ISSUABLE IN SERIES)

--------------------------------------------------------------------------------
PLEASE CAREFULLY CONSIDER OUR DISCUSSION OF SOME OF THE RISKS OF INVESTING IN
THE SECURITIES UNDER "RISK FACTORS" BEGINNING ON PAGE 5
--------------------------------------------------------------------------------


THE TRUSTS

Each trust will be established to hold assets in its trust fund transferred to
it by IndyMac ABS, Inc. The assets in each trust fund will be specified in the
prospectus supplement for the particular trust and will generally consist of:

o    mortgage loans secured by first and/or subordinate liens on one- to
     four-family residential properties, including manufactured housing that is
     permanently affixed and treated as real property under local law, or
     security interests in shares issued by cooperative housing corporations,

o    mortgage loans secured by first and/or subordinate liens on small
     multifamily residential properties, such as rental apartment buildings or
     projects containing five to fifty residential units,

o    closed-end and/or revolving home equity loans, secured in whole or in part
     by first and/or subordinate liens on one-to four-family residential
     properties, or

o    home improvement installment sale contracts and installment loan agreements
     that are secured by first or subordinate liens on one- to four-family
     residential properties


THE SECURITIES

IndyMac ABS, Inc. will sell either certificates or notes pursuant to a
prospectus supplement. The securities will be grouped into one or more series,
each having its own distinct designation. Each series will be issued in one or
more classes and each class will evidence beneficial ownership of a specified
portion of future payments on the assets in the trust fund to which the series
relates. A prospectus supplement for a series will specify all of the terms of
the series and each of the classes in the series.


OFFERS OF SECURITIES

The securities may be offered through several different methods, including
offerings through underwriters.

                            -----------------------

THE SEC AND STATE SECURITIES REGULATORS HAVE NOT APPROVED OR DISAPPROVED THESE
SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

[                             ]





                                TABLE OF CONTENTS

                                                     PAGE
Important Notice About Information In
    This Prospectus and Each
    Accompanying Prospectus Supplement...........       3
Risk Factors.....................................       4
The Trust Fund...................................      24
    General......................................      24
    The Loans....................................      25
    Substitution of Trust Fund Assets............      29
    Available Information........................      29
    Incorporation of Certain Documents by
       Reference.................................      30
Use of Proceeds..................................      30
The Depositor....................................      31
Loan Program.....................................      31
     Underwriting Standards......................      31
     Qualifications of Sellers...................      32
     Representations by Sellers; Repurchases.....      32
Description of the Securities....................      34
     General.....................................      34
     Distributions on Securities.................      36
     Advances....................................      38
     Reports to Securityholders..................      38
     Categories of Classes of Securities.........      40
     Indices Applicable to Floating Rate and
        Inverse Floating Rate Classes............      42
     Derivative Transactions.....................      45
     Book-Entry Registration of Securities.......      45
Credit Enhancement...............................      49
     General.....................................      49
     Subordination...............................      49
     Letter of Credit............................      50
     Insurance Policies, Surety Bonds and
        Guaranties...............................      50
     Over-Collateralization......................      50
     Reserve Accounts............................      51
     Pool Insurance Policies.....................      51
     Cross-Collateralization.....................      52
Yield and Prepayment Considerations..............      52
The Agreements...................................      54
     Assignment of the Trust Fund Assets.........      55
     Payments on Loans; Deposits to Security
        Account..................................      56
     Pre-Funding Account.........................      58
     Sub-Servicing by Sellers....................      59
     Collection Procedures.......................      59
     Hazard Insurance............................      60
     Realization Upon Defaulted Loans............      62
     Servicing and Other Compensation and
        Payment of Expenses......................      63
     Evidence as to Compliance...................      63
     Certain Matters Regarding the Master
        Servicer and the Depositor...............      64
     Events of Default; Rights Upon Event of
        Default..................................      65
     Amendment...................................      67
     Termination; Optional Termination...........      68
     The Trustee.................................      69
Certain Legal Aspects of the Loan................      69
     General.....................................      69
     Foreclosure and Repossession................      70
     Environmental Risks.........................      72
     Rights of Redemption........................      73
     Anti-Deficiency Legislation and Other
        Limitations on Lenders...................      73
     Due-On-Sale Clauses.........................      74
     Prepayment Charges and Late Payment Fees....      75
     Applicability of Usury Laws.................      75
     Home Improvement Contracts..................      75
     Installment Contracts.......................      77
     Servicemembers Civil Relief Act.............      77
     Junior Mortgages and Rights of Senior
        Mortgagees...............................      78
     The Title I Program.........................      79
     Consumer Protection Laws....................      82
Federal Income Tax Consequences..................      82
     General.....................................      82
     Taxation of Debt Securities.................      83
     Taxation of the REMIC and its Holders.......      87
     REMIC Expenses; Single Class REMICs.........      87
     Taxation of the REMIC.......................      88
     Taxation of Holders of Residual Interest
        Securities...............................      89
     Administrative Matters......................      92
     Treatment of High-Yield Interest............      94
     Tax Status as a Grantor Trust...............      95
     Sale or Exchange............................      98
     Miscellaneous Tax Aspects...................      98
     Tax Treatment of Foreign Investors..........      99
     Tax Characterization of the Trust Fund as a
        Partnership..............................      99
     Tax Consequences to Holders of the Notes....     100
     Tax Consequences to Holders of the
        Certificates.............................     100
State Tax Considerations.........................     104
ERISA Considerations.............................     104
Legal Investment.................................     108
Method of Distribution...........................     109
Legal Matters....................................     110
Financial Information............................     110
Rating...........................................     110
Index of Principal Terms.........................     111


                                       2




         IMPORTANT NOTICE ABOUT INFORMATION IN THIS PROSPECTUS AND EACH
                       ACCOMPANYING PROSPECTUS SUPPLEMENT

     Information about each series of securities is contained in two separate
documents:

     o    this prospectus, which provides general information, some of which may
          not apply to a particular series; and

     o    the accompanying prospectus supplement for a particular series, which
          describes the specific terms of the securities of that series.

The prospectus will contain information about a particular series that
supplements the information contained in this prospectus, and you should rely on
that supplementary information in the prospectus supplement.

     You should rely only on the information in this prospectus and the
accompanying prospectus supplement. We have not authorized anyone to provide you
with information that is different from that contained in this prospectus and
the accompanying prospectus supplement.

                              -------------------

     If you require additional information, the mailing address of our principal
executive offices is IndyMac ABS, Inc., 155 North Lake Avenue, Pasadena,
California 91101 and the telephone number is (800) 669-2300. For other means of
acquiring additional information about us or a series of securities, see "The
Trust Fund--Incorporation of Certain Documents by Reference" beginning on page
[30].










                                       3




                                  RISK FACTORS

     You should carefully consider the following information because it
identifies significant risks associated with an investment in the securities.

LIMITED LIQUIDITY                 No market for the securities of any series
                                  will exist before those securities are issued.
                                  We cannot assure you that a secondary market
                                  will develop. Even if a secondary market
                                  develops, we cannot assure you that it will
                                  provide you with liquidity of investment or
                                  that it will continue for the life of the
                                  securities of that series.

LIMITED SOURCE OF PAYMENTS --
NO RECOURSE TO SELLERS,
DEPOSITOR OR MASTER SERVICER      The applicable prospectus supplement may
                                  provide that securities will be payable from
                                  trust funds other than their associated trust
                                  fund, but if it does not, they will be payable
                                  solely from their associated trust fund. If
                                  the trust fund does not have enough assets to
                                  distribute the full amount due to you as a
                                  securityholder, your yield will be impaired,
                                  and the return of your principal may be
                                  impaired, without you having recourse to
                                  anyone else. Furthermore, at the times
                                  specified in the applicable prospectus
                                  supplement, certain assets of the trust fund
                                  and/or any balance remaining in the security
                                  account immediately after making all payments
                                  due on the securities of that series, may be
                                  released and paid out to other people, such as
                                  the depositor, a servicer, a credit
                                  enhancement provider, or any other person
                                  entitled to payments from the trust fund.
                                  Those assets will no longer be available to
                                  make payments to you. Those payments are
                                  generally made only after other specified
                                  payments that may be described in the
                                  applicable prospectus supplement have been
                                  made.

                                  You will not have any recourse against the
                                  depositor or any servicer if you do not
                                  receive a required distribution on the
                                  securities. You will also not have recourse
                                  against the assets of the trust fund of any
                                  other series of securities.

                                  The securities will not represent an interest
                                  in the depositor, any servicer, any seller to
                                  the depositor, or anyone else except the trust
                                  fund. The only obligation of the depositor to
                                  a trust fund comes from certain
                                  representations and warranties made by it
                                  about assets transferred to the trust fund. If


                                       4




                                  these representations and warranties are
                                  untrue, the depositor may be required to
                                  repurchase some of the transferred assets.
                                  IndyMac ABS, Inc., which is the depositor,
                                  does not have significant assets and is
                                  unlikely to have significant assets in the
                                  future. If the depositor were required to
                                  repurchase a loan because of a breach of a
                                  representation, its only sources of funds for
                                  the repurchase would be:

                                  funds obtained from enforcing of a
                                  corresponding obligation of a seller or
                                  originator of the loan or

                                  funds from a reserve account or similar credit
                                  enhancement established to pay for loan
                                  repurchases.

                                  The only obligations of the master servicer to
                                  a trust fund (other than its master servicing
                                  obligations) comes from certain
                                  representations and warranties mad by it in
                                  connection with its loan servicing activities.
                                  If these representations and warranties turn
                                  out to be untrue, the master servicer may be
                                  required to repurchase or substitute for some
                                  of the loans. However, the master servicer may
                                  not have the financial ability to make the
                                  required repurchase or substitution.

                                  The only obligations to a trust fund of a
                                  seller of loans to the depositor comes from
                                  certain representations and warranties made by
                                  it in connection with its sale of the loans
                                  and certain document delivery requirements. If
                                  these representations and warranties turn out
                                  to be untrue, or the seller fails to deliver
                                  required documents, it may be required to
                                  repurchase or substitute for some of the
                                  loans. However, the seller may not have the
                                  financial ability to make the required
                                  repurchase or substitution.

                                  As described in this prospectus, a master
                                  servicer may be obligated to enforce the
                                  sellers' obligations. However, the master
                                  servicer will not be obligated to purchase or
                                  replace any loans if a seller defaults on its
                                  obligation or for any other reason.

CREDIT ENHANCEMENT MAY NOT BE
SUFFICIENT TO PROTECT YOU FROM
LOSSES                            Credit enhancement is intended to reduce the
                                  effect of loan losses. But credit enhancements
                                  may benefit only some classes of a series of
                                  securities, and the amount of any credit
                                  enhancement will be limited as described in
                                  the applicable prospectus supplement.
                                  Furthermore, the amount of a credit



                                       5



                                  enhancement may decline over time pursuant to
                                  a schedule or formula or otherwise, and could
                                  be depleted from payments or for other reasons
                                  before the securities covered by the credit
                                  enhancement are paid in full. In addition, a
                                  credit enhancement may not cover all potential
                                  sources of loss. For example, credit
                                  enhancement may or may not cover fraud or
                                  negligence by a loan originator or other
                                  parties. Also, the trustee may be permitted to
                                  reduce, substitute for or even eliminate all
                                  or a portion of a credit enhancement as long
                                  as the trustee's actions would not cause the
                                  rating agencies that have rated the securities
                                  at the request of the depositor to change
                                  adversely their rating of the securities.
                                  Consequently, securityholders may suffer
                                  losses even though a credit enhancement exists
                                  and its provider does not default.

PREPAYMENT AND YIELD
CONSIDERATIONS                    The timing of principal payments on the
   Your Yield Will Be             securities of a series will be affected by a
   Affected By Prepayments        number of factors, including:
   and By the Allocation
   of Distributions to            the extent of prepayments on the loans in the
   the Securities                 related trust fund,

                                  o   how payments of principal are allocated
                                      among the classes of securities of a
                                      series as specified in the related
                                      prospectus supplement,

                                  o   whether the party entitled to any right of
                                      optional termination of the trust fund
                                      exercises that right, and

                                  o   the rate and timing of payment defaults
                                      and losses on the trust fund assets.

                                  Prepayments include prepayments resulting from
                                  refinancing or liquidation of a loan due to
                                  defaults, casualties and condemnations, as
                                  well as repurchases by the depositor or a
                                  seller due to a breach of representations and
                                  warranties. Prepayments may be affected by a
                                  variety of factors including:

                                  general economic conditions,

                                  interest rates,

                                  the availability of alternative financing and

                                  homeowner mobility.

                                  The rate and timing of prepayment of the loans
                                  will affect the yields to maturity and
                                  weighted average lives of the securities. Any
                                  reinvestment risks from



                                       6



                                  faster or slower prepayments of loans will be
                                  borne entirely by the holders of one or more
                                  classes of the related series of securities.


Your Yield Will Be Affected       Interest payable on the securities of a series
By Delayed Interest Payments      onaccrued each distribution date will include
                                  all interest during the period specified in
                                  the related prospectus supplement. If interest
                                  accrues on your securities over a period
                                  ending two or more days prior to the related
                                  distribution date, your effective yield will
                                  be lower than the yield that you would obtain
                                  if interest on your securities were to accrue
                                  through the day immediately preceding each
                                  distribution date. In addition, your effective
                                  yield (at par) will be less than the indicated
                                  coupon rate.

YOU WILL BEAR THE LOSSES ON       Some of the mortgage loans held in the trust
BALLOON PAYMENT MORTGAGE LOANS    fund may not be fully amortizing over their
                                  terms to maturity. These loans will require
                                  substantial principal payments (balloon
                                  payments) at their stated maturities. Loans
                                  with balloon payments involve a greater degree
                                  of risk than fully amortizing loans because
                                  typically the borrower must be able to
                                  refinance the loan or sell the property to
                                  make the balloon payment at maturity. The
                                  ability of a borrower to do this will depend
                                  on such factors as mortgage rates at the time
                                  of sale or refinancing, the borrower's equity
                                  in the property, the relative strength of the
                                  local housing market, the financial condition
                                  of the borrower, and tax laws. Losses on these
                                  loans that are not otherwise covered by a
                                  credit enhancement will be borne by the
                                  holders of one or more classes of securities
                                  of the related series.

NATURE OF MORTGAGES               The value of the properties underlying the
   Declines in Property Values    loans held in the trust fund may decline over
   May Adversely Affect You the   time. Among factors that could reduce the
   properties                     value of the are:

                                  o   an overall decline in the residential real
                                      estate market in the areas in which they
                                      are located,

                                  o   a decline in their general condition
                                      caused by the borrowers' failure to
                                      maintain their property adequately, and

                                  o   natural disasters, such as earthquakes and
                                      floods, that are not covered by insurance.



                                       7



                                  In the case of home equity loans and home
                                  improvement contracts, declining property
                                  values could diminish or extinguish the value
                                  of a junior mortgage before reducing the value
                                  of a senior mortgage on the same property.

                                  If property values decline, the actual rates
                                  of delinquencies, foreclosures and losses on
                                  all underlying loans could be higher than
                                  those currently experienced in the mortgage
                                  lending industry in general. If these losses
                                  are not otherwise covered by a credit
                                  enhancement, they will be borne by the holders
                                  of one or more classes of securities of the
                                  related series.

Delays in Liquidation             Even if the properties underlying the loans
May Adversely Affect You          held in the trust fund provide adequate
                                  security for the loans, substantial delays
                                  could occur before defaulted loans are
                                  liquidated and their proceeds are forwarded to
                                  investors. Property foreclosure actions are
                                  regulated by state statutes and rules and are
                                  subject to many of the delays and expenses of
                                  other lawsuits if defenses or counterclaims
                                  are made, sometimes requiring several years to
                                  complete. In addition, in some states, if the
                                  proceeds of the foreclosure are insufficient
                                  to repay the loan, the borrower is not liable
                                  for the deficit. If a borrower defaults, these
                                  restrictions may impede the master servicer's
                                  ability to dispose of the property and obtain
                                  sufficient proceeds to repay the loan in full.
                                  In addition, the master servicer will be
                                  entitled to deduct from liquidation proceeds
                                  all expenses reasonably incurred in attempting
                                  to recover on the defaulted loan, including
                                  payments to senior lienholders, legal fees and
                                  costs, real estate taxes, and property
                                  maintenance and preservation expenses.

Disproportionate Effect of        Liquidation expenses of defaulted loans
Liquidation Expenses May          generally do not vary directly with the
Adversely Affect You              outstanding principal balance of the loan at
                                  the time of default. Therefore, if a servicer
                                  takes the same steps for a defaulted loan
                                  having a small remaining principal balance as
                                  it does for a defaulted loan having a large
                                  remaining principal balance, the amount
                                  realized after expenses is a smaller
                                  percentage of the outstanding principal
                                  balance of the small loan than it is for the
                                  defaulted loan with a large remaining
                                  principal balance.



                                       8



Junior Status of Liens Securing   The mortgages and deeds of trust securing the
Home Equity Loans and Home        equity loans and the home improvement home
Improvement Contracts Could       contracts will be primarily junior liens
Adversely Affect You mortgagee    subordinate to the rights of the  under the
                                  related senior mortgage(s) or deed(s) of
                                  trust. Accordingly, the proceeds from any
                                  liquidation, insurance or condemnation
                                  proceeds will be available to satisfy the
                                  outstanding balance of the junior lien only to
                                  the extent that the claims of the related
                                  senior mortgagees have been satisfied in full,
                                  including any related foreclosure costs. In
                                  addition, if a junior mortgagee forecloses on
                                  the property securing a junior mortgage, it
                                  forecloses subject to any senior mortgage and
                                  must take one of the following steps to
                                  protect its interest in the property:

                                  o   pay the senior mortgage in full at or
                                      prior to the foreclosure sale, or

                                  o   assume the payments on the senior mortgage
                                      if the mortgagor is in default under that
                                      mortgage.

                                  The trust fund may effectively be prevented
                                  from foreclosing on the related property,
                                  because it will have no funds to satisfy any
                                  senior mortgages or make payments due to any
                                  senior mortgagees.

                                  Some states have imposed legal limits on the
                                  remedies of a secured lender in the event that
                                  the proceeds of any sale under a deed of trust
                                  or other foreclosure proceedings are
                                  insufficient to pay amounts owed to that
                                  secured lender. In some states, including
                                  California, if a lender simultaneously
                                  originates a loan secured by a senior lien on
                                  a particular property and a loan secured by a
                                  junior lien on the same property, that lender
                                  as the holder of the junior lien may be
                                  precluded from obtaining a deficiency judgment
                                  with respect to the excess of:

                                  o   the aggregate amount owed under both the
                                      senior and junior loans, over

                                  o   the proceeds of any sale under a deed of
                                      trust or other foreclosure proceedings.

                                  See "Certain Legal Aspects of the
                                  Loans--Anti-Deficiency Legislation; Bankruptcy
                                  Laws; Tax Liens."

Consumer Protection Laws          Federal, state and local laws extensively
Adversely Affect You              regulate May various aspects of brokering,
                                  originating, servicing and collecting loans
                                  secured by consumers'



                                       9



                                  dwellings. Among other things, these laws may
                                  regulate interest rates and other charges,
                                  require disclosures, impose financial privacy
                                  requirements, mandate specific business
                                  practices, and prohibit unfair and deceptive
                                  trade practices. In addition, licensing
                                  requirements may be imposed on persons that
                                  broker, originate, service or collect mortgage
                                  loans.

                                  Additional requirements may be imposed under
                                  federal, state or local laws on so-called
                                  "high cost" mortgage loans, which typically
                                  are defined as loans secured by a consumers'
                                  dwelling that have interest rates or
                                  origination costs in excess of prescribed
                                  levels. These laws may limit certain loan
                                  terms, such as prepayment penalties, or the
                                  ability of a creditor to refinance a loan
                                  unless it is in the borrower's interest. In
                                  addition, certain of these laws may allow
                                  claims against loan brokers or mortgage
                                  originators, including claims based on fraud
                                  or misrepresentations, to be asserted against
                                  persons acquiring the mortgage loans, such as
                                  the trust fund.

                                  The federal laws that may apply to loans held
                                  in the trust include the following:

                                  o   the federal Truth in Lending Act and its
                                      regulations, which (among other things)
                                      require disclosures to the borrowers
                                      regarding the terms of any mortgage loan
                                      and provide consumers who pledged their
                                      principal dwelling as collateral in a
                                      non-purchase money transaction with a
                                      right of rescission that generally extends
                                      for three days after proper disclosures
                                      are given;

                                  o   the Equal Credit Opportunity Act and its
                                      regulations, which (among other things)
                                      prohibit discrimination in the extension
                                      of credit on the basis of age, race,
                                      color, sex, religion, marital status,
                                      national origin, receipt of public
                                      assistance or the exercise of any right
                                      under the Consumer Credit Protection Act;
                                      and

                                  o   the Fair Credit Reporting Act, which
                                      (among other things) regulates the use and
                                      reporting of information related to the
                                      borrower's credit experience.

                                  o   Home Equity Loan Consumer Protection Act,
                                      which (among other things) limits changes
                                      made to open-end loans secured by the
                                      consumer's dwelling, and restricts the
                                      ability to



                                       10



                                      accelerate balances or suspend credit
                                      privileges on such loans.

                                  o   the Home Ownership and Equity Protection
                                      Act of 1994, which (among other things)
                                      impose additional disclosure and other
                                      requirements on creditors with respect to
                                      non-purchase money mortgage loans secured
                                      by the consumer's principal dwelling that
                                      have interest rates or origination costs
                                      in excess of prescribed levels. These
                                      provisions can impose specific statutory
                                      liabilities upon creditors who fail to
                                      comply with their provisions and may
                                      affect the enforceability of the related
                                      loans. In addition, any assignee of the
                                      creditor would generally be subject to all
                                      claims and defenses that the consumer
                                      could assert against the creditor,
                                      including the right to rescind the
                                      mortgage loan.

                                  o   the Real Estate Settlement Procedures Act
                                      and its regulations, which (among other
                                      things) prohibit the payment of referral
                                      fees for real estate settlement services
                                      (including mortgage lending and brokerage
                                      services) and regulate escrow accounts for
                                      taxes and insurance and billing inquiries
                                      made by borrowers.

                                  o   Holder in Due Course Rules, which apply to
                                      home improvement contracts which comprise
                                      the Preservation of Consumers' Claims and
                                      Defenses regulations of the Federal Trade
                                      Commission and other similar federal and
                                      state statutes and regulations. The holder
                                      in due course rules protect the homeowner
                                      from defective craftsmanship or incomplete
                                      work by a contractor. These laws permit
                                      the obligor to withhold payment if the
                                      work does not meet the quality and
                                      durability standards agreed to by the
                                      homeowner and the contractor. The holder
                                      in due course rules have the effect of
                                      subjecting any assignee of the seller in a
                                      consumer credit transaction to all claims
                                      and defenses which the obligor in the
                                      credit sale transaction could assert
                                      against the seller of the goods.

                                  The penalties for violating these federal,
                                  state or local laws vary depending on the
                                  applicable law and the particular facts of the
                                  situation. However, private plaintiffs
                                  typically may assert claims for actual damages
                                  and, in some cases, also may



                                       11



                                  recover civil money penalties or exercise a
                                  right to rescind the loan. Violations of
                                  certain laws may limit the ability to collect
                                  all or part of the principal or interest on a
                                  loan and, in some cases, borrowers even may be
                                  entitled to a refund of amounts previously
                                  paid. Federal, state and local administrative
                                  or law enforcement agencies also may be
                                  entitled to bring legal actions, including
                                  actions for civil money penalties or
                                  restitution, for violations of certain of
                                  these laws.


                                  Depending on the particular alleged
                                  misconduct, it is possible that claims may be
                                  asserted against various participants in
                                  secondary market transactions, including
                                  assignees that hold the loans, such as the
                                  trust fund. Losses on loans from the
                                  application of these federal, state and local
                                  laws that are not otherwise covered by a
                                  credit enhancement will be borne by the
                                  holders of one or more classes of securities.

YOUR RISK OF LOSS MAY BE          Multifamily lending may expose the lender to a
HIGHER THAN YOU EXPECT IF YOUR    greater risk of loss than single family
SECURITIES ARE BACKED BY          residential lending. Owners of multifamily
MULTIFAMILY LOANS                 residential properties rely on monthly lease
                                  payments from tenants to

                                  o   pay for maintenance and other operating
                                      expenses of those properties,

                                  o   fund capital improvements, and

                                  o   service any mortgage loan or other debt
                                      that may be secured by those properties.

                                  Various factors, many of which are beyond the
                                  control of the owner or operator of a
                                  multifamily property, may affect the economic
                                  viability of that property.

                                  Changes in payment patterns by tenants may
                                  result from a variety of social, legal and
                                  economic factors. Economic factors include the
                                  rate of inflation, unemployment levels and
                                  relative rates offered for various types of
                                  housing. Shifts in economic factors may
                                  trigger changes in payment patterns including
                                  increased risks of defaults by tenants and
                                  higher vacancy rates. Adverse economic
                                  conditions, either local or national, may
                                  limit the amount of rent that can be charged
                                  and may result in a reduction in timely lease
                                  payments or a reduction in occupancy levels.
                                  Occupancy and


                                       12



                                  rent levels may also be affected by
                                  construction of additional housing units,
                                  competition and local politics, including rent
                                  stabilization or rent control laws and
                                  policies. In addition, the level of mortgage
                                  interest rates may encourage tenants to
                                  purchase single family housing. We cannot
                                  determine and have no basis to predict
                                  whether, or to what extent, economic, legal or
                                  social factors will affect future rental or
                                  payment patterns.

                                  The location and construction quality of a
                                  particular building may affect the occupancy
                                  level as well as the rents that may be charged
                                  for individual units. The characteristics of a
                                  neighborhood may change over time or in
                                  relation to newer developments. The effects of
                                  poor construction quality will increase over
                                  time in the form of increased maintenance and
                                  capital improvements. Even good construction
                                  will deteriorate over time if adequate
                                  maintenance is not performed in a timely
                                  fashion.


YOUR RISK OF LOSS MAY BE          The trust fund for any series may include home
HIGHER THAN YOU EXPECT IF YOUR    equity loans and home improvement contracts
SECURITIES ARE BACKED BY          that were originated with loan-to-value ratios
PARTIALLY UNSECURED HOME          or combined loan-to-value ratios in excess of
IMPROVEMENT CONTRACTS AND         the value of the related mortgaged property.
HOME EQUITY LOANS                 Under these circumstances, the trust fund for
                                  the related series could be treated as a
                                  general unsecured creditor as to any unsecured
                                  portion of any related loan. If a borrower
                                  defaults under a loan that is unsecured in
                                  part, the related trust fund generally will
                                  have recourse only against the borrower's
                                  assets for the unsecured portion of the loan,
                                  along with all other general unsecured
                                  creditors of the borrower. In a bankruptcy or
                                  insolvency proceeding relating to a borrower
                                  on a partially unsecured loan, the borrower's
                                  unsecured obligation on that loan will be
                                  treated as an unsecured loan and may be
                                  discharged by the bankruptcy court. Losses on
                                  any partially unsecured loans that are not
                                  otherwise covered by a credit enhancement will
                                  be borne by the holders of one or more classes
                                  of securities of the related series.

YOU COULD BE ADVERSELY            Federal, state and local laws and regulations
AFFECTED BY VIOLATIONS OF         impose a wide range of requirements on
ENVIRONMENTAL LAWS                activities that may affect the environment,
                                  health and safety. In certain circumstances,
                                  these laws and regulations


                                       13



                                  impose obligations on owners or operators of
                                  residential properties such as those that
                                  secure the loans held in the trust fund.
                                  Failure to comply with these laws and
                                  regulations can result in fines and penalties
                                  that could be assessed against the trust as
                                  owner of the related property.

                                  In some states, a lien on the property due to
                                  contamination has priority over the lien of an
                                  existing mortgage. Also, a mortgage lender may
                                  be held liable as an "owner" or "operator" for
                                  costs associated with the release or threat of
                                  release of petroleum and/or hazardous
                                  substances under certain circumstances if the
                                  lender has actually participated in the
                                  management of the mortgaged property. If the
                                  trust is considered the owner or operator of a
                                  property, it will suffer losses as a result of
                                  any liability imposed for environmental
                                  hazards on the property.

RATING OF THE SECURITIES DOES     Any class of securities issued under this
NOT ASSURE THEIR PAYMENT          prospectus and the accompanying prospectus
                                  supplement will be rated in one of the four
                                  highest rating categories of at least one
                                  nationally recognized rating agency. A rating
                                  is based on the adequacy of the value of the
                                  related trust assets and any credit
                                  enhancement for that class, and reflects the
                                  rating agency's assessment of how likely it is
                                  that holders of the class of securities will
                                  receive the payments to which they are
                                  entitled. A rating is not an assessment of how
                                  likely it is that principal prepayments on the
                                  underlying loans will be made, the degree to
                                  which the rate of prepayments might differ
                                  from that originally anticipated or how likely
                                  it is that the securities of a series will be
                                  redeemed early. A rating is not a
                                  recommendation to purchase, hold or sell
                                  securities because it does not address the
                                  market price or the securities or the
                                  suitability of the securities for any
                                  particular investor.

                                  A rating does not take into account the
                                  possibility that prepayment at higher or lower
                                  rates than an investor anticipates may cause a
                                  reduction in that investor's yield. A rating
                                  does not take into account the possibility
                                  that an investor purchasing a security at a
                                  premium might lose money on its initial
                                  investment under certain prepayment scenarios.
                                  In addition, if the rating relates to a series
                                  with a pre-funding account, it does not take
                                  into account:



                                       14



                                  o   the ability of the related trust fund to
                                      acquire subsequent loans,

                                  o   any prepayment of the securities resulting
                                      from the distribution of amounts remaining
                                      in the pre-funding account after the end
                                      of the funding period, or

                                  o   the effect on an investor's yield
                                      resulting from any such distribution.

                                  A rating may not remain in effect for any
                                  given period of time and the rating agency
                                  could lower or withdraw the rating entirely in
                                  the future. For example, the rating agency
                                  could lower or withdraw its rating due to:

                                  o   a decrease in the adequacy of the value of
                                      the trust assets or any related credit
                                      enhancement,

                                  o   an adverse change in the financial or
                                      other condition of a credit enhancement
                                      provider, or

                                  o   a change in the rating of the credit
                                      enhancement provider's long term debt.

                                  The amount, type and nature of credit
                                  enhancement established for a class of
                                  securities will be determined based on
                                  criteria established by each rating agency
                                  rating classes of that series. These criteria
                                  are sometimes based upon an actuarial analysis
                                  of the behavior of similar loans in a larger
                                  group. That analysis is often the basis upon
                                  which each rating agency determines the amount
                                  of credit enhancement required for a class.
                                  The historical data supporting any actuarial
                                  analysis may not accurately reflect future
                                  experience, and the data derived from a large
                                  pool of similar loans may not accurately
                                  predict the delinquency, foreclosure or loss
                                  experience of any particular pool of mortgage
                                  loans. Mortgaged properties may not retain
                                  their values. If residential real estate
                                  markets experience an overall decline in
                                  property values such that the outstanding
                                  principal balances of the loans in a
                                  particular trust fund and any secondary
                                  financing on the related mortgaged properties
                                  become equal to or greater than the value of
                                  the mortgaged properties, the rates of
                                  delinquencies, foreclosures and losses could
                                  be higher than those now generally experienced
                                  in the mortgage lending industry. In addition,
                                  adverse economic conditions may prevent
                                  certain mortgagors from making timely payments
                                  on their loans. If that happens, the rates of
                                  delinquencies, foreclosures and losses in



                                       15



                                  any trust fund may increase. If these losses
                                  are not covered by a credit enhancement, they
                                  will be borne, at least in part, by the
                                  holders of one or more classes of securities
                                  of the related series.

BOOK-ENTRY REGISTRATION           Securities issued in book-entry form may
   Limit on Liquidity             have only limited liquidity in the resale
                                  market because investors may not want to
                                  buy securities for which they cannot
                                  obtain physical instruments.

   Limit on Ability to Transfer   Transactions in book-entry securities can
   or Pledge                      be effected only through The Depository
                                  Trust Company, its participating
                                  organizations, its indirect participants
                                  and certain banks. Therefore, your ability
                                  to transfer or pledge securities issued in
                                  book-entry form may be limited.

   Delays in Distributions        You may experience some delay in receiving
                                  distributions on book-entry securities because
                                  the trustee will send the distributions to The
                                  Depository Trust Company for it to credit the
                                  accounts of its participants. In turn, these
                                  participants will then credit the
                                  distributions to your account either directly
                                  or indirectly through indirect participants.

PRE-FUNDING ACCOUNTS              The prospectus supplement for a series of
   Pre-Funding Accounts Will Not  securities may provide that on the closing
   Be Used to Cover Losses on     date for that series,  the depositor will
   the Loans                      deposit cash into a pre-funding  account. The
                                  amount deposited into the pre-funding account
                                  will never exceed 50% of the initial aggregate
                                  principal amount of the certificates and/or
                                  notes of the related series. The pre-funding
                                  account will be used to purchase additional
                                  loans from the depositor during the period
                                  beginning with the related closing date and
                                  ending not more than one year after the
                                  closing date. The depositor will acquire these
                                  additional loans from the seller or sellers
                                  specified in the related prospectus
                                  supplement. The trustee for the related series
                                  will maintain the pre-funding account. The
                                  pre-funding account will only hold funds to be
                                  used for purchasing the additional loans
                                  described above. Amounts on deposit in the
                                  pre-funding account will not be used to cover
                                  losses on or in respect of the related loans.

   Unused Amounts Will Be         Any amounts remaining in a pre-funding account
   Paid as Principal to           at the end of the period specified in the
   Securityholders                applicable


                                       16



                                  prospectus supplement will be distributed as a
                                  prepayment of principal to the related
                                  securityholders on the first distribution date
                                  after the end of that period. Any such
                                  distribution will be made in the amounts and
                                  according to the priorities specified in the
                                  related prospectus supplement. The holders of
                                  one or more classes of the related series of
                                  securities will bear the entire reinvestment
                                  risk resulting from that prepayment.

BANKRUPTCY OR INSOLVENCY MAY      The seller and the depositor will treat the
AFFECT THE TIMING AND AMOUNT      transfer of the loans held in the trust fund
OF DISTRIBUTIONS ON THE           by the seller to the depositor as a sale for
SECURITIES                        accounting purposes. The depositor and the
                                  trust fund will treat the transfer of the
                                  loans from the depositor to the trust fund as
                                  a sale for accounting purposes. If these
                                  characterizations are correct, then if the
                                  seller were to become bankrupt, the loans
                                  would not be part of the seller's bankruptcy
                                  estate and would not be available to the
                                  seller's creditors. On the other hand, if the
                                  seller becomes bankrupt, its bankruptcy
                                  trustee or one of its creditor's may attempt
                                  to recharacterize the sale of the loans as a
                                  borrowing by the seller, secured by a pledge
                                  of the loans. Presenting this position to a
                                  bankruptcy court could prevent timely payments
                                  on the securities and even reduce the payments
                                  on the securities. Similarly, if the
                                  characterizations of the transfers as sales
                                  are correct, then if the depositor were to
                                  become bankrupt, the loans would not be part
                                  of the depositor's bankruptcy estate and would
                                  not be available to the depositor's creditors.
                                  On the other hand, if the depositor becomes
                                  bankrupt, its bankruptcy trustee or one of its
                                  creditor's may attempt to recharacterize the
                                  sale of the loans as a borrowing by the
                                  depositor, secured by a pledge of the loans.
                                  Presenting this position to a bankruptcy court
                                  could prevent timely payments on the
                                  securities and even reduce the payments on the
                                  securities.

                                  If the master servicer becomes bankrupt, the
                                  bankruptcy trustee may have the power to
                                  prevent the appointment of a successor master
                                  servicer. The period during which cash
                                  collections may be commingled with the master
                                  servicer's own funds before each distribution
                                  date for securities will be specified in the
                                  applicable prospectus supplement. If the
                                  master servicer becomes bankrupt and cash
                                  collections have been commingled with the
                                  master servicer's own funds for at least ten
                                  days, the trust



                                       17



                                  fund will probably not have a perfected
                                  interest in those collections. In this case
                                  the trust might be an unsecured creditor of
                                  the master servicer as to the commingled funds
                                  and could recover only its share as a general
                                  creditor, which might be nothing. Collections
                                  commingled less than ten days but still in an
                                  account of the master servicer might also be
                                  included in the bankruptcy estate of the
                                  master servicer even though the trust may have
                                  a perfected security interest in them. Their
                                  inclusion in the bankruptcy estate of the
                                  master servicer may result in delays in
                                  payment and failure to pay amounts due on the
                                  securities.

                                  Federal and state statutory provisions
                                  affording protection or relief to distressed
                                  borrowers may affect the ability of the
                                  secured mortgage lender to realize upon its
                                  security in other situations as well. For
                                  example, in a proceeding under the federal
                                  Bankruptcy Code, a lender may not foreclose on
                                  a mortgaged property without the permission of
                                  the bankruptcy court. Additionally, in certain
                                  instances a bankruptcy court may allow a
                                  borrower to reduce the monthly payments,
                                  change the rate of interest, and alter the
                                  mortgage loan repayment schedule for
                                  under-collateralized mortgage loans. The
                                  effect of these types of proceedings can be to
                                  cause delays in receiving payments on the
                                  loans underlying securities and even to reduce
                                  the aggregate amount of payments on the loans
                                  underlying securities.

HOLDERS OF ORIGINAL ISSUE         Debt securities that are compound interest
DISCOUNT SECURITIES ARE REQUIRED  securities will be, and certain other debt be,
TO INCLUDE ORIGINAL ISSUE         securities may issued with original issue
DISCOUNT IN ORDINARY GROSS        income discount for federal tax purposes. A
INCOME AS IT ACCRUES              holder of debt securities issued with
                                  original issue discount is required to include
                                  original issue discount in ordinary gross
                                  income for federal income tax purposes as it
                                  accrues, before receiving the cash
                                  attributable to that income. Accrued but
                                  unpaid interest on the debt securities that
                                  are compound interest securities generally
                                  will be treated as original issue discount for
                                  this purpose.

                                  See "Federal Income Tax Consequences-Taxation
                                  of Debt Securities--Interest and Acquisition
                                  Discount" and "--Market Discount."

RESIDUAL INTEREST IN A REAL       If you own a certificate that is a residual
ESTATE MORTGAGE INVESTMENT        interest in a real estate mortgage investment
CONDUIT HAS ADVERSE TAX           conduit for federal income tax purposes, you
CONSEQUENCES                      will have to report on your income tax return
                                  as ordinary



                                       18



   Inclusion of Taxable Income    income your pro rata share of the taxable
   in Excess of Cash Received     income of that REMIC, regardless of the amount
                                  or timing of your possible receipt of any cash
                                  on the certificate. As a result, your offered
                                  certificate may have phantom income early in
                                  the term of the REMIC because the taxable
                                  income from the certificate may exceed the
                                  amount of economic income, if any,
                                  attributable to the certificate. Although you
                                  will have a corresponding amount of tax losses
                                  later in the term of the REMIC, the present
                                  value of the phantom income may significantly
                                  exceed the present value of the tax losses.
                                  Therefore, the after-tax yield on any REMIC
                                  residual certificate may be significantly less
                                  than that of a corporate bond or other
                                  instrument having similar cash flow
                                  characteristics. In fact, some offered
                                  certificates that are residual interests, may
                                  have a negative value.

                                  You have to report your share of the taxable
                                  income and net loss of the REMIC until all the
                                  certificates in the related series have a
                                  principal balance of zero. See "Federal Income
                                  Tax Consequences -- Taxation of Holders of
                                  Residual Interest Securities."

   Some Taxable Income of a       A portion of the taxable income from a REMIC
   Residual Interest Cannot Be    residual certificate may be treated as "excess
   Offset                         inclusion income"  as defined in the Internal
                                  Revenue Code of 1986, as amended (the "Code").
                                  You will have to pay tax on the excess
                                  inclusions regardless of whether you have
                                  other credits, deductions or losses. In
                                  particular, the tax on excess inclusion
                                  income:

                                  o   generally will not be reduced by losses
                                      from other activities,

                                  o   for a tax-exempt holder, will be treated
                                      as unrelated business taxable income, and

                                  o   for a foreign holder, will not qualify for
                                      any exemption from withholding tax.

                                  Individuals, Estates, Trust The fees and
                                  non-interest expenses of a REMIC and Certain
                                  Pass-through will be allocated pro rata to
                                  certificates Entities Should Not Invest that
                                  are residual interest in the REMIC. in REMIC
                                  Residual Certificates However, individuals
                                  will only be able to deduct these expensesas
                                  miscellaneous itemized deductions, which are
                                  subject to numerous restrictions and
                                  limitations under the Code. Therefore, the
                                  certificates that are residual interests
                                  generally are


                                       19




                                  not appropriate investments for:

                                  o   individuals,

                                  o   estates,

                                  o   trusts beneficially owned by any
                                      individual or estate, and

                                  o   pass-through entities having any
                                      individual, estate or trust as a
                                      shareholder, member or partner.

                                  In addition, the REMIC residual certificates
                                  will be subject to numerous transfer
                                  restrictions. These restrictions will reduce
                                  your ability to liquidate a REMIC residual
                                  certificate. For example, unless we indicate
                                  otherwise in the related prospectus
                                  supplement, you will not be able to transfer a
                                  REMIC residual certificate to a foreign person
                                  under the Code or to an entity treated as a
                                  partnership under the Code, unless all of its
                                  beneficial owners are United States persons.

                                  See "Federal Income Tax Consequences --
                                  Taxation of Holders of Residual Interest
                                  Securities."

THE PRINCIPAL AMOUNT OF           The market value of the assets relating to a
SECURITIES MAY EXCEED THE         series of securities at any time may be less
MARKET VALUE OF THE TRUST FUND    than the principal amount of the securities of
ASSETS                            that series then outstanding, plus accrued
                                  interest. After an event of default and a sale
                                  of the assets relating to a series of
                                  securities, the trustee, the master servicer,
                                  the credit enhancer, if any, and any other
                                  service provider specified in the related
                                  prospectus supplement generally will be
                                  entitled to receive the proceeds of that sale
                                  to the extent of unpaid fees and other amounts
                                  owing to them under the related transaction
                                  documents before any distributions to
                                  securityholders. Upon any such sale, the
                                  proceeds may be insufficient to pay in full
                                  the principal of and interest on the
                                  securities of the related series.

DERIVATIVE TRANSACTIONS           A trust fund may enter into privately
                                  negotiated, over-the-counter hedging
                                  transactions with various counterparties for
                                  the purpose of effectively fixing the interest
                                  rate it pays on one or more borrowings or
                                  series of borrowings These transactions
                                  include interest rate and securities-based
                                  swaps, caps, collars and floors, and are
                                  referred to as derivative transactions.


                                       20




   Credit Risks                   If a trust fund enters into derivative
                                  transactions, it is expected to do so with
                                  banks, financial institutions and recognized
                                  dealers in derivative transactions. Entering
                                  into a derivative transaction directly with a
                                  counterparty subjects a trust fund to the
                                  credit risk that the counterparty may default
                                  on its obligation to the trust fund. By
                                  contrast, in transactions done through
                                  exchange markets, credit risk is reduced by
                                  the collection of variation margin and by the
                                  interposition of a clearing organization as
                                  the guarantor of all transactions. Clearing
                                  organizations transform the credit risk of
                                  individual counterparties into the more remote
                                  risk of the failure of the clearing
                                  organization. In addition, the financial
                                  integrity of over-the-counter derivative
                                  transactions is generally unsupported by other
                                  regulatory or self-regulatory protections such
                                  as margin requirements, capital requirements,
                                  or financial compliance programs. Therefore,
                                  the risk of default is much greater in an
                                  over-the-counter, privately negotiated
                                  derivative transaction than in an
                                  exchange-traded transaction. In the case of a
                                  default, the related trust fund will be
                                  limited to contractual remedies under the
                                  agreements governing that derivative
                                  transaction. These remedies may be limited by
                                  bankruptcy, insolvency or similar laws.

   Legal Enforceability Risks     Privately negotiated, over-the-counter
                                  derivative transactions also may subject a
                                  trust fund to the following risks:

                                  o   if the counterparty does not have the
                                      legal capacity to enter into or perform
                                      its obligations under the transaction, the
                                      transaction would be unenforceable,

                                  o   if a court or regulatory body ruled that
                                      classes of derivative transactions were
                                      unlawful or not in compliance with
                                      applicable laws or regulations, those
                                      transactions would be invalid and
                                      unenforceable, or

                                  o   if new legislation changed the legal,
                                      regulatory or tax status of derivative
                                      transactions, those changes might be
                                      detrimental to the related trust fund's
                                      interests.

   Basis Risk                     Using derivative transactions successfully
                                  depends upon the ability to predict movements
                                  of securities or interest rate markets. There
                                  might be an imperfect correlation, or even no
                                  correlation,

                                       21



                                  between price movements of a derivative
                                  transaction and price movements of the
                                  investments or instruments being hedged. If
                                  a trust fund enters into derivative
                                  transactions at the wrong time, or if market
                                  conditions are not predicted accurately, the
                                  derivative transaction may result in a
                                  substantial loss to that trust fund and the
                                  related securityholders.

                                  Certain capitalized terms are used in this
                                  prospectus to assist you in understanding the
                                  terms of the securities. The capitalized terms
                                  used in this prospectus are defined on the
                                  pages indicated under the caption "Index of
                                  Principal Terms" beginning on page [111].







                                       22



                                 THE TRUST FUND


GENERAL

     The certificates of each series will represent interests in the assets of a
trust fund. The notes of each series will be secured by a pledge of the assets
of the related trust fund. The trustee will hold the trust fund for each series
for the benefit of the related securityholders. Each trust fund will consist of
the related trust fund assets (the "Trust Fund Assets"), which include a pool of
loans specified in the related prospectus supplement together with payments
relating to those loans, as specified in the related prospectus supplement.*
Unless the related prospectus supplement provides otherwise, the pool will be
created on the first day of the month of issuance of the related series of
securities. The securities will be entitled to payment from the assets of the
related trust fund or funds or other assets pledged for the benefit of the
securityholders, as specified in the related prospectus supplement and will not
be entitled to payments in respect of the assets of any other trust fund
established by the depositor..

     The depositor will acquire the Trust Fund Assets (either directly or
through affiliates) from originators or sellers that may be affiliates of the
depositor. The depositor will then convey the Trust Fund Assets without recourse
to the related trust fund. Loans that the depositor acquires will have been
originated in accordance with the underwriting criteria specified in this
prospectus under "Loan Program-Underwriting Standards" or as otherwise described
in the related prospectus supplement.

     The depositor will cause the Trust Fund Assets to be assigned to the
trustee named in the related prospectus supplement for the benefit of the
holders of the securities of the related series. The master servicer named in
the related prospectus supplement will service the Trust Fund Assets, either
directly or through other servicing institutions called sub-servicers, pursuant
to o a pooling and servicing agreement among the depositor, the master servicer
and the trustee, in the case of

     o   a series consisting of certificates, or

     o   a master servicing agreement between the trustee and the master
         servicer, in the case of a series consisting of certificates and notes.
         The master servicer will receive a fee for its services. See "Loan
         Program" and "The Agreements" in this prospectus. With respect to loans
         serviced by the master servicer through a sub-servicer, the master
         servicer will remain liable for its servicing obligations under the
         related agreement as if the master servicer alone were servicing those
         loans.

     In the case of a series consisting of certificates, the term "agreement"
means the related pooling and servicing agreement. In the case of a series
consisting of certificates and notes, the term "agreement" means the related
trust agreement, indenture and master servicing agreement, as the context
requires.

--------------
* Whenever the terms pool, certificates, notes and securities are used in this
  prospectus, those terms will apply, unless the context indicates otherwise, to
  one specific pool and the securities of one series including the certificates
  representing undivided interests in, and/or notes secured by the assets of, a
  single trust fund consisting primarily of the loans in that pool. The term
  pass-through rate will refer to the pass-through rate borne by the
  certificates, and the term interest rate will refer to the interest rate borne
  by the notes, as applicable, of one specific series. The term trust fund will
  refer to one specific trust fund.





                                       23



     If specified in the related prospectus supplement, a trust fund for a
series may be a business trust formed under the laws of the state specified in
the related prospectus supplement pursuant to a trust agreement between the
depositor and the related trustee.

     Before the initial offering of a series of securities, the trust fund for
that series will have no assets or liabilities. The trust fund for a series is
not expected to engage in any activities other than:

     o   acquiring, holding and managing the related Trust Fund Assets and any
         other assets specified in this prospectus and the related prospectus
         supplement (including any proceeds of those assets),

     o   issuing securities and making distributions on them, and

     o   certain other related activities.

The trust fund for a series is not expected to have any source of capital other
than its assets and any related credit enhancement.

     The related prospectus supplement may provide for additional obligations of
the depositor, but if it does not, the depositor's only obligations with respect
to a series of securities will be to obtain certain representations and
warranties from the sellers and to assign to the related trustee the depositor's
rights with respect to those representations and warranties. See "The
Agreements-- Assignment of the Trust Fund Assets." The master servicer's
obligations with respect to the loans will consist mainly of its contractual
servicing obligations under the related agreement (including its obligation to
enforce the obligations of the sub-servicers or sellers, or both, as described
in this prospectus under "Loan Program-Representations by Sellers; Repurchases"
and "The Agreements--Sub-Servicing By Sellers" and "--Assignment of the Trust
Fund Assets"), and any obligation to make cash advances in the event of
delinquent payments on the loans, as described under "Description of the
Securities--Advances" in this prospectus. The master servicer's obligation to
make advances may be limited, as described in this prospectus and the related
prospectus supplement.

     The following is a brief description of the assets expected to be included
in the trust funds. If specific information about the Trust Fund Assets is not
known when the related series of securities is initially offered, the related
prospectus supplement will contain more general information of the type
described below. Specific information will be set forth in a report on Form 8-K
to be filed with the SEC within fifteen days after the initial issuance of the
securities. A maximum of 5% of the Trust Fund Assets as they will be constituted
at the time that the applicable detailed description of Trust Fund Assets is
filed will deviate in any material respect from the Trust Fund Asset pool
characteristics described in the related prospectus supplement (other than the
aggregate number or amount of loans). A copy of the agreement with respect to
each series will be attached to the Form 8-K and will be available for
inspection at the corporate trust office of the trustee specified in the related
prospectus supplement. A schedule of the loans relating to that series will be
attached to the agreement delivered to the trustee upon delivery of the
securities.


THE LOANS

     General. Loans will consist of single family loans, multifamily loans, home
equity loans or home improvement contracts. In this prospectus, "home equity
loans" includes "closed-end



                                       24



loans" and "revolving credit line loans." If specified in the related prospectus
supplement, the loans may include cooperative apartment loans ("cooperative
loans") secured by security interests in shares issued by private, non-profit,
cooperative housing corporations ("cooperatives") and in the related proprietary
leases or occupancy agreements granting exclusive rights to occupy specific
dwelling units in the cooperatives' buildings. As more fully described in the
related prospectus supplement, the loans may be "conventional" loans or loans
that are insured or guaranteed by a governmental agency such as the Federal
Housing Administration (the "FHA") or the Department of Veterans' Affairs (the
"VA").

     The applicable prospectus supplement may specify the day on which monthly
payments on the mortgage loans in a mortgage pool will be due, but if it does
not, all the loans in a pool will have monthly payments due on the first, tenth,
fifteenth, twentieth or twenty-fifth day of each month. The related prospectus
supplement will describe the payment terms of the loans to be included in a
trust fund. The payment terms may include any of the following features, any
combination of these features, or other features:

     o   Interest may be payable at a fixed rate, a rate that adjusts from time
         to time in relation to a specified index, a rate that is fixed for a
         period of time or under certain circumstances and is followed by an
         adjustable rate, a rate that otherwise varies from time to time, or a
         rate that is convertible from an adjustable rate to a fixed rate.
         Changes to an adjustable rate may be subject to periodic limitations,
         maximum rates, minimum rates or a combination of limitations. Accrued
         interest may be deferred and added to the principal of a loan as
         described more fully in the related prospectus supplement. Loans may
         provide for the payment of interest at a rate lower than the specified
         interest rate borne by that loan (the "Loan Rate") for a period of time
         or for the life of the loan; the amount of any difference may be
         contributed by the seller of the property or by another source.

     o   Principal may be payable on a level debt service basis to fully
         amortize the loan over its term, may be calculated on the basis of an
         assumed amortization schedule that is significantly longer than the
         original term to maturity or on an interest rate that is different from
         the Loan Rate, or may not be amortized during all or a portion of the
         original term. Payment (referred to as a "balloon payment") of all or a
         substantial portion of the principal may be due on maturity. Principal
         may include interest that has been deferred and added to the principal
         balance of the loan.

     o   Monthly payments of principal and interest may be fixed for the life of
         the loan, may increase over a specified period of time or may change
         from period to period. The terms of a loan may include limits on
         periodic increases or decreases in the amount of monthly payments and
         may include maximum or minimum amounts of monthly payments.

     o   The loans generally may be prepaid at any time. Prepayments of
         principal may be subject to a prepayment fee, which may be fixed for
         the life of the loan or may decline over time, and may be prohibited
         for the life of the loan or for certain periods (called lockout
         periods). Certain loans may permit prepayments after expiration of the
         applicable lockout period, and may impose a prepayment fee in
         connection with any subsequent prepayment. Other loans may permit
         prepayments without payment of a fee unless the prepayment occurs
         during specified time periods. The loans may include "due on sale"
         clauses that permit the mortgagee to demand payment of the entire loan
         in connection



                                       25



         with the sale or certain transfers of the related mortgaged property.
         Other loans may be assumable by persons meeting the then applicable
         underwriting standards of the seller.

     A trust fund may contain buydown loans. In a buydown loan, a third party
partially subsidizes the monthly payments of the mortgagor during the early
years of the loan. The difference is made up from a buydown fund contributed by
the third party at the time the loan is originated. The amount of the buydown
fund will equal either the discounted value or the full aggregate amount of
future payment subsidies. Thereafter, buydown funds are applied to the loan at
the time the master servicer receives the mortgagor's portion of the monthly
payment. The master servicer administers the buydown fund to ensure that the
monthly allocation from the buydown fund, combined with the monthly payment
received from the mortgagor, equals the scheduled monthly payment on the loan. A
buydown plan assumes that the mortgagor's income will increase during the
buydown period so that the mortgagor will be able to make the full mortgage
payments at the end of the buydown period. If the mortgagor's income does not
increase, the mortgagor might default on its buydown loan. If a trust fund
contains buydown loans, the related prospectus supplement will describe any
limitations on the interest rate initially paid by the mortgagor, on annual
increases in the interest rate, and on the length of the buydown period.

     The real properties securing repayment of the loans are referred to as the
mortgaged properties. The loans will be secured by mortgages or deeds of trust
or other similar security instruments creating a lien on a mortgaged property.
In the case of the home equity loans and home improvement contracts, liens
generally will be subordinated to one or more senior liens on the related
mortgaged properties, as described in the related prospectus supplement. In
addition to being secured by mortgages on real estate, the home improvement
contracts may also be secured by purchase money security interests in the home
improvements financed thereby. If so specified in the related prospectus
supplement, the home equity loans and the home improvement contracts may include
loans (primarily for home improvement or debt consolidation purposes) in amounts
exceeding the value of the related mortgaged properties at the time of
origination. The mortgaged properties and the home improvements are collectively
referred to in this prospectus as the "Properties" and are individually referred
to as a "Property." The Properties may be located in any one of the fifty
states, the District of Columbia, Guam, Puerto Rico or any other territory of
the United States.

     Loans with certain Loan-to-Value Ratios (defined below) and/or certain
principal balances may be covered wholly or partially by primary mortgage
guaranty insurance policies. The existence, extent and duration of any such
coverage will be described in the applicable prospectus supplement.

     The related prospectus supplement will disclose the aggregate principal
balance of loans secured by owner-occupied properties. The related prospectus
supplement also may state the basis for representations relating to Single
Family Properties (defined below), but if it does not, the sole basis for a
representation that a given percentage of the loans is secured by owner-occupied
Single Family Properties will be either:

     o   the borrower's representation at origination either that the borrower
         will use the Property for at least six months every year or that the
         borrower intends to use the Property as a primary residence, or

     o   a finding that the address of the underlying Property is the borrower's
         mailing address.




                                       26



     Single Family Loans. The mortgaged properties relating to single family
loans will consist of detached or semi-detached one- to four-family dwelling
units, townhouses, rowhouses, individual condominium units, individual units in
planned unit developments, manufactured housing that is permanently affixed and
treated as real property under local law, security interests in shares issued by
cooperative housing corporations, and certain other dwelling units ("Single
Family Properties"). Single Family Properties may include vacation and second
homes, investment properties and leasehold interests. In the case of leasehold
interests the related prospectus supplement may specify the leasehold term, but
if it does not, [the remaining term of the leasehold and any sublease is at
least as long as the remaining term on the loan]/[the term of the leasehold will
exceed the schedule maturity of the loan by at least five years].

     Multifamily Loans. Mortgaged properties securing multifamily loans may
include small multifamily residential properties such as rental apartment
buildings or projects containing five to fifty residential units, including
mid-rise and garden apartments. Certain of the multifamily loans may be secured
by apartment buildings owned by cooperatives. The cooperative owns all the
apartment units in the building and all common areas. The cooperative is owned
by tenant-stockholders who, through ownership of stock, shares or membership
certificates in the corporation, receive proprietary leases or occupancy
agreements conferring exclusive rights to occupy specific apartments or units.
Generally, a tenant-stockholder of a cooperative makes a monthly payment to the
cooperative representing that tenant-stockholder's pro rata share of the
cooperative's payments for its mortgage loan, real property taxes, maintenance
expenses and other capital or ordinary expenses. That monthly payment is in
addition to any payments of principal and interest the tenant-stockholder makes
on any loans to the tenant-stockholder secured by its shares in the cooperative.
The cooperative will be directly responsible for building management and, in
most cases, payment of real estate taxes and hazard and liability insurance. A
cooperative's ability to meet debt service obligations on a multifamily loan, as
well as all other operating expenses, will depend in large part on its receipt
of maintenance payments from the tenant-stockholders, as well as any rental
income from units the cooperative controls. Unanticipated expenditures may in
some cases have to be paid by special assessments on the tenant-stockholders. No
more than 10% of the aggregate Trust Fund Assets for any series, as constituted
at the time of the applicable cut-off date (measured by principal balance), will
be comprised of multifamily loans.

     Home Equity Loans. The mortgaged properties relating to home equity loans
will be Single Family Properties. The home equity loans will be either revolving
credit line loans or closed-end loans.

     o   Revolving credit line loans. As more fully described in the related
         prospectus supplement, interest on each revolving credit line loan
         (excluding introductory rates offered from time to time during
         promotional periods) is computed and payable monthly on the average
         daily outstanding principal balance of the loan. Principal amounts on a
         revolving credit line loan may be drawn down (up to a maximum amount
         specified in the related prospectus supplement) or repaid under each
         revolving credit line loan from time to time, but may be subject to a
         minimum periodic payment. Except as provided in the related prospectus
         supplement, the Trust Fund Assets will not include any amounts borrowed
         under a revolving credit line loan after the cut-off date.

     o   Closed-end loans. The full amount of a closed-end loan is advanced at
         the inception of the loan and generally is repayable in equal (or
         substantially equal) installments designed



                                       27



         to  fully amortize the loan at its stated maturity. Except as provided
         in  the related prospectus supplement, the original terms to stated
         maturity of closed-end loans will not exceed 360 months.

     o   With respect to certain circumstances, under either a revolving credit
         line loan or a closed-end loan, a borrower may choose an interest only
         payment option whereby the borrower pays only the amount of interest
         accrued on the loan during the billing cycle. An interest only payment
         option may be available for a specified period before the borrower must
         begin paying at least the minimum monthly payment of a specified
         percentage of the average outstanding balance of the loan.

     Home Improvement Contracts. The Trust Fund Assets for a series of
securities may consist, in whole or in part, of home improvement contracts
originated by a home improvement contractor, a thrift or a commercial mortgage
banker in the ordinary course of business. The home improvements securing the
home improvement contracts may include, but are not limited to, replacement
windows, house siding, new roofs, swimming pools, spas, kitchen and bathroom
remodeling goods, solar heating panels and other exterior and interior
renovations and general remodeling projects. The home improvement contracts will
be secured by mortgages on Single Family Properties that are generally
subordinate to other mortgages on the same Property. In general, the home
improvement contracts will be fully amortizing and may have fixed interest rates
or adjustable interest rates and may provide for other payment characteristics
as described below and in the related prospectus supplement. The initial
Loan-to-Value Ratio of a home improvement contract is computed in the manner
described in the related prospectus supplement. See "Risk Factors-Your Risk of
Loss May Be Higher Than You Expect If Your Securities Are Backed By Partially
Unsecured Home Improvement Contracts and Home Equity Loans."

     Additional Information. Each prospectus supplement will contain information
about the loans in the related pool, as of the date of the prospectus supplement
and to the extent then known to the depositor. This information will include:

     o   the aggregate outstanding principal balance and the average outstanding
         principal balance of the loans as of the first day of the month of
         issuance of the related series or any other date referred to in the
         related prospectus supplement as a cut-off date,

     o   the type of property securing the loans (e.g., single family
         residences, individual units in condominium apartment buildings, small
         multi-family properties, or other real property or home improvements),

     o   the original terms to maturity of the loans,

     o   the largest principal balance and the smallest principal balance of any
         of the loans,

     o   the earliest origination date and latest maturity date of any of the
         loans,

     o   the Loan-to-Value Ratios or Combined Loan-to-Value Ratios (each as
         defined below), as applicable, of the loans,

     o   the Loan Rates or annual percentage rates ("APR") or range of Loan
         Rates or APRs borne by the loans,

     o   the maximum and minimum per annum Loan Rates and

     o   the geographical distribution of the loans.



                                       28



If the depositor does not know specific information about the loans when the
related series of securities is initially offered, the related prospectus
supplement will contain more general information of the type described below.
Specific information will be set forth in the detailed description of Trust Fund
Assets.

     Unless otherwise specified in the related prospectus supplement, the
"Loan-to-Value Ratio" of a loan at any given time is a fraction, expressed as a
percentage, the numerator of which is the original principal balance of the
related loan and the denominator of which is the collateral value of the related
Property.

     Unless otherwise specified in the related prospectus supplement, the
"Combined Loan-to-Value Ratio" of a loan at any given time is the ratio,
expressed as a percentage, of

     (x) the sum of

     o   the original principal balance of the loan (or, in the case of a
         revolving credit line loan, the maximum amount available at
         origination), and

     o   the outstanding principal balance at the date of origination of the
         loan of any senior mortgage loan(s) (or, in the case of any open-ended
         senior mortgage loan, the maximum available line of credit with respect
         to that loan at origination, regardless of any lesser amount actually
         outstanding at the date of origination of the loan,

     to

     (y) the collateral value of the related Property.

     The applicable prospectus supplement may specify how the collateral value
of a Property will be calculated, but if it does not, the collateral value of a
Property (other than with respect to certain loans the proceeds of which were
used to refinance an existing mortgage loan), is the lesser of:

     o   the sales price for the property, or

     o   the appraised value determined in an appraisal obtained by the
         originator at origination of the loan.

In the case of refinance loans, the collateral value of the related Property is
generally the appraised value determined in an appraisal obtained at the time of
refinancing.

     Mortgaged properties may not retain their values. If residential real
estate markets experience an overall decline in property values such that the
outstanding principal balances of the loans in a particular trust fund and any
primary or secondary financing on the related mortgaged properties, as
applicable, become equal to or greater than the value of the mortgaged
properties, the rates of delinquencies, foreclosures and losses could be higher
than those now generally experienced in the mortgage lending industry. In
addition, adverse economic conditions may prevent certain mortgagors from making
timely payments on their loans. If that happens, the rates of delinquencies,
foreclosures and losses in any trust fund may increase. If these losses are not
covered by a credit enhancement, they will be borne, at least in part, by the
holders of one or more classes of securities of the related series.



                                       29



SUBSTITUTION OF TRUST FUND ASSETS


     Substitution of Trust Fund Assets will be permitted upon breaches of
representations and warranties with respect to any original Trust Fund Asset or
if the trustee determines that the documentation with respect to any Trust Fund
Asset is incomplete. See "Loan Program-Representations by Sellers; Repurchases."
The related prospectus supplement generally will specify the period during which
substitution will be permitted.


AVAILABLE INFORMATION

     The depositor has filed with the SEC a Registration Statement under the
Securities Act of 1933, as amended, covering the securities. This prospectus,
which forms a part of the Registration Statement, and the prospectus supplement
relating to each series of securities contain summaries of the material terms of
the documents referred to in this prospectus and in the prospectus supplement,
but do not contain all of the information in the Registration Statement pursuant
to the rules and regulations of the SEC. For further information, reference is
made to the Registration Statement and its exhibits. The Registration Statement
and exhibits can be inspected and copied at prescribed rates at the public
reference facilities maintained by the SEC at its Public Reference Room, 450
Fifth Street, N.W., Washington, D.C. 20549, and at its Regional Offices located
as follows: Chicago Regional Office, 500 West Madison Street, Chicago, Illinois
60661; and New York Regional Office, 233 Broadway, New York, New York 10279. You
may obtain information on the operation of the Public Reference Room by calling
the SEC at 1-800-SEC-0330. The SEC also maintains an internet web site that
contains reports, information statements and other information regarding the
registrants that file electronically with the SEC, including the depositor. The
address of that internet web site is http://www.sec.gov.

     This prospectus and any related prospectus supplement do not constitute an
offer to sell or a solicitation of an offer to buy any securities other than the
securities offered by this prospectus and any related prospectus supplement nor
an offer of the securities to any person in any state or other jurisdiction in
which the offer would be unlawful. The delivery of this prospectus at any time
does not imply that the information in it is correct as of any time after its
date.


INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

All documents referred to in the accompanying prospectus supplement that are
filed for the trust fund with the SEC after the date of this prospectus and
before the end of the related offering pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934, as amended, are incorporated by
reference in this prospectus and are a part of this prospectus from the date of
their filing. Any statement contained in a document incorporated by reference in
this prospectus is modified or superseded for all purposes of this prospectus to
the extent that a statement contained in this prospectus (or in the accompanying
prospectus supplement) or in any other subsequently filed document also
incorporated by reference differs from that statement. Any statement so modified
or superseded shall not, except as so modified or superseded, constitute a part
of this prospectus. Neither the depositor nor the master servicer for any series
intends to file with the SEC periodic reports with respect to the related trust
fund following completion of the reporting period required by Rule 15d-1 or
Regulation 15D under the Exchange Act of 1934, and accordingly those periodic
reports will not be filed for each trust fund after the first fiscal year of the
trust fund unless, at the beginning of any subsequent fiscal



                                       30



year of a trust fund, the securities of any class issued by that trust fund are
held of record by 300 or more persons.

     The trustee (or any other entity specified in the related prospectus
supplement) on behalf of any trust fund will provide without charge to each
person to whom this prospectus is delivered, on that person's written or oral
request, 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 the exhibits are
specifically incorporated by reference into the information that this prospectus
incorporates). Requests should be directed to the corporate trust office of the
trustee or the address of any other entity, in each case as specified in the
accompanying prospectus supplement. The accompanying prospectus supplement
includes the name, address, telephone number, and, if available, facsimile
number of the office or contact person at the corporate trust office of the
trustee or other entity.


REPORTS TO SECURITYHOLDERS

     Periodic and annual reports concerning the trust fund will be forwarded to
securityholders. Such reports, however, will neither be examined nor reported on
by an independent public accountant. See "Description of the Securities--Reports
to Securityholders."


                                 USE OF PROCEEDS

     The depositor will use the net proceeds from the sale of the securities to
purchase Trust Fund Assets or will use those proceeds for general corporate
purposes. The depositor expects to sell securities in series from time to time,
but the timing and amount of securities offerings will depend on a number of
factors, including the volume of Trust Fund Assets acquired by the depositor,
prevailing interest rates, availability of funds and general market conditions.


                                  THE DEPOSITOR

     IndyMac ABS, Inc., a Delaware corporation, was incorporated in April 1998
for the limited purpose of acquiring, owning and transferring mortgage and
mortgage related assets and selling interests in them or bonds secured by them.
The depositor is a limited purpose finance subsidiary of IndyMac Bank, F.S.B.
The depositor maintains its principal office at 155 North Lake Avenue, Pasadena,
California 91101. Its telephone number is (800) 669-2300.

     Neither the depositor nor any of the depositor's affiliates will insure or
guarantee distributions on the securities of any series.


                                  LOAN PROGRAM

     The depositor will have purchased the loans, either directly or through
affiliates, from various sellers. The applicable prospectus supplement may
specify other underwriting criteria used in originating the loans, but if it
does not, the loans that the depositor acquires will have been originated in
accordance with the underwriting criteria specified below under "--Underwriting
Standards."


UNDERWRITING STANDARDS

     The applicable prospectus supplement may provide for the seller's
representations and warranties relating to the loans, but if it does not, each
seller will represent and warrant that all



                                       31



loans originate and/or sold by it to the depositor or one of its affiliates will
have been underwritten in accordance with standards consistent with those
utilized by mortgage lenders generally during the period of origination for
similar types of loans. As to any loan insured by the FHA or partially
guaranteed by the VA, the seller will represent that it has complied with the
underwriting policies of the FHA or the VA, as the case may be.

     Underwriting standards are applied by or on behalf of a lender to evaluate
a borrower's credit standing and ability to repay, as well as the value and
adequacy of the related Property as collateral. In general, a prospective
borrower applying for a loan is required to fill out a detailed application that
will supply the underwriting officer with pertinent credit information,
including the principal balance and payment history with respect to any senior
mortgage. Unless otherwise specified in the related prospectus supplement, the
related seller will verify the credit information supplied by the borrower. The
borrower generally must provide a current list of assets and liabilities and a
statement of income and expenses, as well as an authorization to apply for a
credit report summarizing the borrower's credit history with local merchants and
lenders and any record of bankruptcy. In most cases, an employment verification
is obtained from an independent source (typically the borrower's employer). The
employment verification specifies the length of employment with that
organization, the borrower's current salary and whether it is expected that the
borrower will continue employment in the future. If a prospective borrower is
self-employed, the borrower may be required to submit copies of signed tax
returns. The borrower may also be required to authorize verification of deposits
at financial institutions where the borrower has demand or savings accounts.

     In determining the adequacy of the mortgaged property as collateral, an
appraisal is made of each property considered for financing. The appraiser is
required to inspect the property and verify that it is in good repair and that
construction, if new, has been completed. The appraisal is based on the market
value of comparable homes, the estimated rental income (if considered applicable
by the appraiser) and the cost of replacing the home. The appraised value of the
property must be such that it currently supports, and is expected to support in
the future, the outstanding loan balance.

     The maximum loan amount will vary depending on a borrower's credit grade
and loan program but will not generally exceed $[1,000,000]. Variations in
maximum loan amount limits will be permitted based on compensating factors. As
specified in the related prospectus supplement, compensating factors may include
low Loan-to-Value Ratio, low debt-to-income ratio, stable employment, favorable
credit history and the nature of any underlying first mortgage loan.

     Each seller's underwriting standards will generally permit loans with
Loan-to-Value Ratios at origination of up to 100% depending on the loan program,
type and use of the property, creditworthiness of the borrower and
debt-to-income ratio. If specified in the related prospectus supplement, a
seller's underwriting criteria may permit loans with Loan-to-Value Ratios at
origination in excess of 100%, such as for debt consolidation or home
improvement purposes. Loan-to-Value Ratios may not be evaluated in the case of
Title I Loans.

     After obtaining the employment, credit and property information, the seller
may use a debt-to-income ratio to assist in determining whether the prospective
borrower has sufficient monthly income available to make payments on the
mortgage loan in addition to any other monthly credit obligations. The
"debt-to-income ratio" is the ratio of the borrower's total monthly payments to



                                       32



the borrower's gross monthly income. The maximum monthly debt-to-income ratio
will vary depending on a borrower's credit grade and loan program. Variations in
the debt-to-income ratio limit will be permitted based on any compensating
factors specified in the related prospectus supplement.

     In the case of a loan secured by a leasehold interest in real property the
title to which is held by a third party lessor, the seller will (unless
otherwise specified in the related prospectus supplement) represent and warrant,
among other things, that the remaining term of the lease and any sublease is at
least as long as the remaining term on the loan.

     Some of the loans that may be included in a trust fund are types of loans
that have been developed recently and may involve additional uncertainties not
present in traditional types of loans. For example, some loans may provide for
escalating or variable payments by the borrower. These loans are underwritten
based on a judgment that the borrowers are able to make the initial monthly
payments. In some cases, a borrower's income may not be sufficient for the
borrower to continue to make loan payments as the payments increase. These loans
may also be underwritten primarily based on Loan-to-Value Ratios or other
favorable credit factors.


QUALIFICATIONS OF SELLERS

     Each seller must be an institution experienced in originating and servicing
loans of the type contained in the related pool in accordance with accepted
practices and prudent guidelines, and must maintain satisfactory facilities to
originate and service those loans. Unless otherwise specified in the related
prospectus supplement, each seller also must be:

     o   a seller/servicer approved by either the Federal National Mortgage
         Association ("FNMA") or the Federal Home Loan Mortgage Corporation
         ("FHLMC"), and

     o   a mortgagee approved by HUD or an institution the deposit accounts of
         which are insured by the Federal Deposit Insurance Corporation (the
         "FDIC").


REPRESENTATIONS BY SELLERS; REPURCHASES

     Each seller will have made representations and warranties in respect of the
loans sold by it and evidenced by all, or a part, of a series of securities.
These representations and warranties generally will include, among other things:

     o   that title insurance (or in the case of Properties located in areas
         where title insurance policies are generally not available, an
         attorney's certificate of title) and any required hazard insurance
         policy were effective at the origination of each loan (other than
         cooperative loans and certain home equity loans), and that each policy
         (or certificate of title, as applicable) remained in effect on the date
         the loan was purchased from the seller by or on behalf of the
         depositor;

     o   that the seller had good title to each loan and that the loan was not
         subject to any valid offsets, defenses, counterclaims or rights of
         rescission except to the extent that any buydown agreement may forgive
         certain indebtedness of a borrower;

     o   that each loan (other than cooperative loans) constituted a valid lien
         on, or a perfected security interest in, the Property (subject only to
         any permissible disclosed liens, any applicable title insurance
         exceptions, any applicable liens of nondelinquent current real



                                       33



         property taxes and assessments, any applicable liens arising under
         federal, state or local laws relating to hazardous wastes or hazardous
         substances, any applicable liens for common charges, and certain other
         exceptions described in the applicable agreement);

     o   that there were no delinquent tax or assessment liens against the
         Property;

     o   that no required payment on a loan was delinquent more than the number
         of days specified in the related prospectus supplement; and

     o   that each loan was made in compliance with, and is enforceable under,
         all applicable local, state and federal laws and regulations in all
         material respects.

     If specified in the related prospectus supplement, the seller's
representations and warranties in respect of a loan will be made as of the date
on which the seller sold the loan to the depositor or one of its affiliates,
instead of as of the cut-off date. In that case, a substantial period of time
may have elapsed between the sale date and the date of initial issuance of the
series of securities evidencing an interest in the loan. Because the seller's
representations and warranties do not include events occurring after the sale,
the seller's repurchase obligation (described in the next paragraph) will not
apply if an event that would otherwise have triggered the obligation occurs
after the sale date. However, the depositor will not include any loan in a trust
fund if the depositor has reason to believe that the seller's representations
and warranties in respect of that loan will not be accurate and complete in all
material respects as of the date of initial issuance of the related series of
securities. If the master servicer is also a seller of loans with respect to a
particular series, these representations will be in addition to the
representations and warranties made by the master servicer in its capacity as
master servicer.

     The master servicer (or the trustee, if the master servicer is also the
seller) will promptly notify the applicable seller of any breach of its
representations and warranties in respect of a loan that materially and
adversely affects the securityholders' interests in that loan. If the seller
cannot cure the breach on or before the business day after the first
determination date (as defined in the related prospectus supplement) that is
more than 90 days after the seller receives notice from the master servicer or
the trustee, as the case may be, the seller will be obligated either:

     o   to repurchase the loan from the trust fund at a price (the "Purchase
         Price") equal to 100% of its unpaid principal balance as of the date of
         the repurchase plus accrued interest thereon at the Loan Rate, up to
         the scheduled monthly payment date for the loan in the month following
         the month of repurchase (less any advances or amount payable as related
         servicing compensation if the seller is the master servicer), or

     o   to substitute for the loan a replacement loan that satisfies the
         criteria specified in the related prospectus supplement; provided,
         however, that the seller will not be obligated to make any repurchase
         or substitution (or cure a breach) if the breach constitutes fraud in
         the origination of the affected loan and the seller did not have
         knowledge of the fraud.

If a REMIC election is to be made with respect to a trust fund, unless otherwise
specified in the related prospectus supplement, the master servicer or a holder
of the related residual certificate will be obligated to pay any prohibited
transaction tax in connection with any repurchase or substitution. In addition,
the trustee must have received a satisfactory opinion of counsel that the
repurchase or substitution will not cause the trust fund to lose its status as a
REMIC or otherwise subject the trust fund to a prohibited transaction tax. The
master servicer may be entitled to reimbursement from the assets of the related
trust fund or from any holder of the related residual



                                       34



certificate. See "Description of the Securities--General" in this prospectus.
Except where the master servicer is also the seller, the master servicer will be
required under the applicable agreement to enforce this obligation for the
benefit of the trustee and the securityholders , acting in its good faith
business judgment as if it were the owner of the loan. This obligation to
repurchase or substitute will constitute the sole remedy available to
securityholders or the trustee for a seller's breach of representations and
warranties.

     Neither the depositor nor the master servicer (unless the master servicer
is a seller) will be obligated to purchase or substitute a loan if a seller
defaults on its obligation to do so. No assurance can be given that sellers will
fulfill their repurchase or substitution obligations.


                          DESCRIPTION OF THE SECURITIES

     Each series of certificates will be issued pursuant to separate agreements
(a pooling and servicing agreement or a trust agreement) among the depositor,
the master servicer and the trustee. A form of pooling and servicing agreement
and a form of trust agreement have been filed as a exhibits to the Registration
Statement of which this prospectus forms a part. Each series of notes will be
issued pursuant to an indenture between the related trust fund and the entity
named in the related prospectus supplement as trustee for that series, and the
related loans will be serviced by the master servicer pursuant to a master
servicing agreement. A form of indenture and a form of master servicing
agreement have been filed as exhibits to the Registration Statement of which
this prospectus forms a part. A series of securities may consist of both notes
and certificates. Each agreement, dated as of the related cut-off date, will be
among the depositor, the master servicer and the trustee for the benefit of the
securityholders of the securities of that series. The provisions of each
agreement will vary depending on the nature of the securities to be issued under
it and the nature of the related trust fund. The following summaries of the
material provisions that may appear in each agreement are subject to, and are
qualified in their entirety by reference to, all the provisions of the
agreements for each series of securities and the applicable prospectus
supplement. The depositor will provide a copy of the agreements (without
exhibits) relating to any series without charge upon written request of a holder
of record of a security of that series addressed to IndyMac ABS, Inc., 155 North
Lake Avenue, Pasadena, California 91101, Attention: Secondary Marketing.


GENERAL

     The securities of each series will be issued either in book-entry or fully
registered form in the authorized denominations specified in the related
prospectus supplement. In the case of certificates, the securities will evidence
specified beneficial ownership interests in the related trust fund. In the case
of notes, the securities will be secured by the assets of the related trust
fund. The securities will not be entitled to payments in respect of the assets
included in any other trust fund established by the depositor. Unless otherwise
specified in the related prospectus supplement, the securities will not
represent obligations of the depositor or any affiliate of the depositor.
Certain of the loans may be guaranteed or insured, as specified in the related
prospectus supplement. Each trust fund will consist of, to the extent provided
in the related agreement:

     o   the Trust Fund Assets that from time to time are subject to the related
         agreement (exclusive of any amounts specified in the related prospectus
         supplement as a retained interest, including all payments of interest
         and principal received with respect to the loans



                                       35



         after the cut-off date (to the extent not applied in computing the
         principal balance of the loans as of the cut-off date));

     o   the assets required to be deposited in the related Security Account
         from time to time, as described under "The Agreements--Payments on
         Loans; Deposits to Security Account";

     o   property that secured a loan and is acquired on behalf of the
         securityholders by foreclosure or deed in lieu of foreclosure, and

     o   any insurance policies or other forms of credit enhancement required to
         be maintained pursuant to the related agreement.

If specified in the related prospectus supplement, a trust fund may also include
one or more of the following: reinvestment income on payments received on the
Trust Fund Assets, a reserve account, a mortgage pool insurance policy, a
special hazard insurance policy, a bankruptcy bond, one or more letters of
credit, a surety bond, guaranties or similar instruments.

     Each series of securities will be issued in one or more classes. Each class
of certificates of a series will evidence beneficial ownership of a specified
percentage or portion of future interest payments and a specified percentage or
portion of future principal payments on the related Trust Fund Assets. These
specified percentages may be 0%. Each class of notes of a series will be secured
by the related Trust Fund Assets. A series of securities may include one or more
classes that are senior in right to payment to one or more other classes of
securities of the series. Certain series or classes of securities may be covered
by insurance policies, surety bonds or other forms of credit enhancement, in
each case as described under "Credit Enhancement" in this prospectus and in the
related prospectus supplement. One or more classes of securities of a series may
be entitled to receive distributions of principal, interest or any combination
of principal and interest. Distributions on one or more classes of a series of
securities may be made

     o   before distributions on one or more other classes,

     o   after the occurrence of specified events,

     o   in accordance with a schedule or formula, or

     o   based on collections from designated portions of the related Trust Fund
         Assets,

in each case as specified in the related prospectus supplement. The timing and
amount of these distributions may vary among classes or over time, as specified
in the related prospectus supplement.

     The trustee will make distributions of principal and interest (or, where
applicable, principal only or interest only) on the related securities on each
applicable distribution date in proportion to the percentages specified in the
related prospectus supplement. Distributions may be made monthly, quarterly,
semi-annually or at other intervals and on the dates specified in the related
prospectus supplement. Distributions will be made to the persons in whose names
the securities are registered at the close of business on the dates specified in
the related prospectus supplement. Distributions will be made in the manner
specified in the related prospectus supplement to the persons entitled to them
at the addresses appearing in the security register maintained for
securityholders; provided, however, that the final distribution in retirement of
the securities will be made only upon presentation and surrender of the
securities at the office or agency of the trustee or other person specified in
the notice to securityholders of the final distribution.



                                       36



     The securities will be freely transferable and exchangeable at the
corporate trust office of the trustee specified in the related prospectus
supplement. No service charge will be made for any registration of exchange or
transfer of securities of any series, but the trustee may require payment of a
sum sufficient to cover any related tax or other governmental charge.

     Under current law, the purchase and holding of certain classes of
securities by or on behalf of any employee benefit plan or other retirement
arrangement subject to provisions of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA") or the Internal Revenue Code of 1986, as amended
(the "Code"), may result in "prohibited transactions" within the meaning of
ERISA and the Code, or may subject the trustee, the master servicer or the
depositor to obligations or liabilities in addition to those undertaken in the
related agreement. See "ERISA Considerations" in this prospectus. Retirement
arrangements subject to these provisions include individual retirement accounts
and annuities, Keogh plans and collective investment funds in which the plans,
accounts or arrangements are invested. The applicable prospectus supplement may
specify other conditions under which transfers of this type would be permitted,
but if it does not, transfer of securities of those classes will not be
registered unless the transferee

     o   represents that it is not, and is not purchasing on behalf of, a plan,
         account or other retirement arrangement, or

     o   provides an opinion of counsel satisfactory to the trustee and the
         depositor that the purchase of securities of that class by or on behalf
         of a plan, account or other retirement arrangement is permissible under
         applicable law and will not subject the trustee, the master servicer or
         the depositor to any obligation or liability in addition to those
         undertaken in the agreements.

     As to each series, an election may be made to treat the related trust fund
or designated portions of it as a "real estate mortgage investment conduit" or
REMIC, as defined in the Code. The related prospectus supplement will specify
whether a REMIC election is to be made. Alternatively, the agreement for a
series may provide that a REMIC election may be made at the discretion of the
depositor or the master servicer and may be made only if certain conditions are
satisfied. The terms applicable to the making of a REMIC election, as well as
any material federal income tax consequences to securityholders not described in
this prospectus, will be set forth in the related prospectus supplement. If a
REMIC election is made with respect to a series, one of the classes will be
designated as evidencing the sole class of "residual interests" in the related
REMIC, as defined in the Code. All other classes of securities in the series
will constitute "regular interests" in the related REMIC, as defined in the
Code. As to each series for which a REMIC election is made, the master servicer
or a holder of the related residual interest or ownership interest,
respectively, will be obligated to comply with applicable laws and regulations
and will be obligated to pay any prohibited transaction taxes. The applicable
prospectus supplement may restrict the master servicer's reimbursement rights,
but if it does not, the master servicer will be entitled to reimbursement for
that payment from the assets of the trust fund or from any holder of the related
residual certificate or ownership interest.


DISTRIBUTIONS ON SECURITIES

     General. In general, the method of determining the amount of distributions
on a particular series of securities will depend on the type of credit support,
if any, for that series. See "Credit Enhancement" in this prospectus. Various
methods that may be used in determining the amount



                                       37



of distributions on the securities of a series are described in the following
paragraphs. Each prospectus supplement will describe in detail the method for
determining the amount of distributions on the securities of that series.

     The trustee will make distributions of principal and interest on the
securities out of, and only to the extent of, funds in the related Security
Account, including any funds transferred from any reserve account. Each
prospectus supplement will describe how distributions of principal and interest
will be applied to the related securities on each distribution date. Each
prospectus supplement will also describe the method of allocating distributions
among securities of a particular class.

     Available Funds. All distributions on the securities of each series on each
distribution date will be made from the "Available Funds," as described in the
related prospectus supplement and the related agreement. The applicable
prospectus supplement may define Available Funds with reference to different
accounts or different amounts, but if it does not, "Available Funds" for each
distribution date will generally equal the amount on deposit in the related
Security Account on that distribution date (net of related fees and expenses
payable by the related trust fund) other than amounts to be held in the Security
Account for distribution on future distribution dates.

     Distributions of Interest. Interest will accrue on the aggregate principal
balance of the securities (or, in the case of securities entitled only to
distributions allocable to interest, the aggregate notional amount) of each
class of securities (the "Class Security Balance") entitled to interest at the
pass-through rate or interest rate, as applicable (which in either case may be
fixed or adjustable, as specified in the related prospectus supplement), from
the date and for the periods specified in that prospectus supplement. If funds
are available, interest accrued during each specified period on each class of
securities entitled to interest (other than a class of securities on which
interest accrues but is not currently payable) will be distributable on the
distribution dates specified in the related prospectus supplement until the
aggregate Class Security Balance of the class has been distributed in full. In
the case of securities entitled only to distributions allocable to interest,
interest will be distributable until the aggregate notional amount of the
securities is reduced to zero, or for the period specified in the related
prospectus supplement. The original principal balance of each security will
equal the aggregate distributions allocable to principal to which that security
is entitled. Distributions allocable to interest on each security that is not
entitled to distributions allocable to principal will be calculated based on the
notional amount of that security. The notional amount of a security will not
evidence an interest in or entitlement to distributions allocable to principal
but will be used solely for convenience in expressing the calculation of
interest and for certain other purposes.

     Interest payable on the securities of a series on a distribution date will
include all interest accrued during the period specified in the related
prospectus supplement. If the interest accrual period for a security ends two or
more days before a distribution date, the effective yield will be lower than the
yield obtained if interest on the security were to accrue through the day
immediately preceding that distribution date. In addition, the effective yield
(at par) to securityholders will be less than the indicated coupon rate.

     With respect to a class of accrual securities, any interest that has
accrued but is not paid on any distribution date will be added to the Class
Security Balance of that class on that distribution date. The applicable
prospectus supplement may specify some other basis for these distributions, but
if it does not, distributions of interest on each class of accrual securities
will begin only after



                                       38



the occurrence of the events specified in the related prospectus supplement.
Before that time, the beneficial ownership interest in the trust fund (or the
principal balance, as applicable) of a class of accrual securities, as reflected
in its Class Security Balance, will increase on each distribution date by the
amount of interest that accrued on the class during the preceding interest
accrual period but was not distributed on that distribution date. A class of
accrual securities will thereafter accrue interest on its outstanding Class
Security Balance as so adjusted.

     Distributions of Principal. The related prospectus supplement will specify
the method of calculating the amount of principal to be distributed on the
securities on each distribution date and the manner of allocating it among the
classes of securities entitled to distributions of principal. The Class Security
Balance of any class entitled to distributions of principal generally will be
the original Class Security Balance of that class, reduced by all distributions
reported to the holders of that class as allocable to principal and,

     o   in the case of accrual securities, increased by all interest accrued
         but not then distributable on those securities and

     o   in the case of adjustable rate securities, subject to the effect of
         negative amortization, if applicable.

     If specified in the related prospectus supplement, one or more classes of
securities will be entitled to receive all or a disproportionate percentage of
the principal payments received from borrowers in advance of their scheduled due
dates and not accompanied by amounts representing scheduled interest due after
the month of those payments, in the percentages and under the circumstances or
for the periods specified in the prospectus supplement. Any disproportionate
allocation of these principal prepayments to a class or classes of securities
will have the effect of accelerating the amortization of those securities while
increasing the interests evidenced by one or more other classes of securities in
the trust fund. Increasing the interests of certain classes of securities
relative to that of other securities is intended to preserve the availability of
the subordination provided by those other securities. See "Credit
Enhancement--Subordination" in this prospectus.

     Unscheduled Distributions. If specified in the related prospectus
supplement, the securities may receive distributions before the next scheduled
distribution date under the circumstances and in the manner described below and
in the related prospectus supplement. If applicable, the trustee will be
required to make unscheduled distributions on the day and in the amount
specified in the related prospectus supplement if, due to substantial payments
of principal (including principal prepayments) on the Trust Fund Assets, the
trustee or the master servicer determines that the funds available or
anticipated to be available from the Security Account and, if applicable, any
reserve account, may be insufficient to make required distributions on the
securities on the next distribution date. The applicable prospectus supplement
may specify some other basis for these distributions, but if it does not, the
amount of the unscheduled distribution that is allocable to principal will not
exceed the amount that would otherwise have been required to be distributed as
principal on the securities on the next distribution date. The applicable
prospectus supplement may provide that unscheduled distribution will not include
interest or that interest will be computed on a different basis, but if it does
not, all unscheduled distributions will include interest at any applicable
pass-through rate or interest rate on the amount of the unscheduled distribution
allocable to principal for the period and to the date specified in the
prospectus supplement.



                                       39




ADVANCES


     To the extent provided in the related prospectus supplement, the master
servicer will be required to advance on or before each distribution date (from
its own funds, funds advanced by sub-servicers or funds held in the Security
Account for future distributions to securityholders), an amount equal to the
aggregate of payments of interest and principal that were delinquent on the
related determination date and were otherwise not advanced by any sub-servicer,
subject to the master servicer's determination that the advances will be
recoverable out of late payments by borrowers, liquidation proceeds, insurance
proceeds or otherwise. In the case of cooperative loans, the master servicer
also may be required to advance any unpaid maintenance fees and other charges
under the related proprietary leases as specified in the related prospectus
supplement.

     In making advances, the master servicer will try to maintain a regular flow
of scheduled interest and principal payments to securityholders, rather than to
guarantee or insure against losses. If the master servicer makes advances from
funds in a Security Account, the master servicer will replace the funds on or
before the next distribution date if the funds in that Security Account on that
distribution date would be less than the amount required for distributions to
securityholders on that date. Any advances will be reimbursable to the master
servicer out of recoveries on the specific loans with respect to which the
advances were made (e.g., late payments made by the related borrower, any
related insurance proceeds, liquidation proceeds or proceeds of any loan
repurchased by the depositor, a sub-servicer or a seller pursuant to the related
agreement). In addition, advances by the master servicer or sub-servicer also
will be reimbursable to the master servicer or sub-servicer from cash otherwise
distributable to securityholders (including the holders of senior securities) to
the extent that the master servicer determines that the advances previously made
are not ultimately recoverable as described in the preceding sentence. If
specified in the related prospectus supplement, the master servicer also will be
obligated to make advances, to the extent recoverable out of insurance proceeds,
liquidation proceeds or otherwise, for certain taxes and insurance premiums not
paid by borrowers on a timely basis. Funds so advanced are reimbursable to the
master servicer to the extent permitted by the related agreement. The
obligations of the master servicer to make advances may be supported by a cash
advance reserve fund, a surety bond or other arrangement of the type described
under "Credit Enhancement" in this prospectus and the related prospectus
supplement.

     In the event that the master servicer or a sub-servicer fails to make a
required advance, the applicable prospectus supplement may specify whether
another party will have advancing obligations, but if it does not, the trustee
will be obligated to make such advance in its capacity as successor servicer. If
the trustee makes such an advance, it will be entitled to be reimbursed for such
advance to the same extent and degree as the master servicer or a sub-servicer
is entitled to be reimbursed for advances. See "Description of the
Securities--Distributions on Securities."


REPORTS TO SECURITYHOLDERS

     The applicable prospectus supplement may specify different items to be
reported, but if it does not, the master servicer or the trustee will furnish to
each related securityholder of record, either before or concurrently with each
distribution on a distribution date, a statement including, to the extent
applicable to that series:



                                       40



     o   the amount of the distribution allocable to principal, separately
     identifying the aggregate amount of any principal prepayments and if
     specified in the related prospectus supplement, prepayment penalties;

     o   the amount of the distribution allocable to interest;

     o   the amount of any advance;

     o   the aggregate amount otherwise allocable to the subordinated
     securityholders on that distribution date and the aggregate amount
     withdrawn from the reserve account, if any, that is included in the amounts
     distributed to the senior securityholders;

     o   the outstanding principal balance or notional amount of each class of
     the related series after giving effect to the distribution of principal on
     that Distribution Date;

     o   the percentage of principal payments on the loans (excluding
     prepayments), if any, that each class will be entitled to receive on the
     following distribution date;

     o   the percentage of principal prepayments on the loans, if any, that each
     class will be entitled to receive on the following distribution date;

     o   the related amount of the servicing compensation retained or withdrawn
     from the Security Account by the master servicer, and the amount of
     additional servicing compensation received by the master servicer
     attributable to penalties, fees, excess liquidation proceeds and other
     similar charges and items;

     o   the number and aggregate principal balances of loans

               o   delinquent but not in foreclosure 1 to 30 days, 31 to 60
               days, 61 to 90 days and 91 or more days, and

               o   in foreclosure and delinquent 1 to 30 days, 31 to 60 days, 61
               to 90 days and 91 or more days,

         in each case as of the close of business on the last day of the
         calendar month preceding that distribution date;

     o   the book value of any real estate acquired through foreclosure or grant
     of a deed in lieu of foreclosure;

     o   the pass-through rate or interest rate, as applicable, if adjusted from
     the date of the last statement, expected to apply to any class on the next
     distribution date for that class;

     o   the amount remaining in any reserve account at the close of business on
     the distribution date; o

     o   the pass-through rate or interest rate, as applicable, as of the day
     before the preceding distribution date; and

     o   any amounts remaining under letters of credit, pool policies or other
     forms of credit enhancement.

     Where applicable, any amount set forth above may be expressed as a dollar
amount per single security of the applicable class having the percentage
interest specified in the related prospectus supplement. The report to
securityholders for any series of securities may include other information
similar to that specified above.

     In addition, within a reasonable period of time after the end of each
calendar year, the master servicer or the trustee will mail to each
securityholder of record at any time during that calendar year:



                                       41



     o   a report containing the aggregate of the amounts referred to in items
         (i) and (ii) above for that calendar year (or, if that person was a
         securityholder of record during a portion of the calendar year, for the
         applicable portion of that year, and

     o   other customary information considered appropriate for securityholders
         to prepare their tax returns.


CATEGORIES OF CLASSES OF SECURITIES

     In general, classes of securities fall into different categories. The
following chart identifies and generally defines certain of the more typical
categories. The prospectus supplement for a series of securities may identify
the classes in that series by reference to the following categories.


                                                          DEFINITION
       CATEGORIES OF CLASSES                           PRINCIPAL TYPES

Accretion Directed........................     A class that receives principal
                                               payments from the accreted
                                               interest from specified accrual
                                               classes. An accretion directed
                                               class also may receive principal
                                               payments from principal paid on
                                               the underlying Trust Fund Assets
                                               or other assets of the trust fund
                                               for the related series.

Companion Class...........................     A class that receives principal
                                               payments on any distribution date
                                               only if scheduled payments have
                                               been made on specified planned
                                               principal classes, targeted
                                               principal classes or scheduled
                                               principal classes.

Component Securities......................     A class consisting of
                                               "components." The components of a
                                               class of component securities may
                                               have different principal and
                                               interest payment characteristics
                                               but together constitute a single
                                               class. Each component of a class
                                               of component securities may be
                                               identified as falling into one or
                                               more of the categories in this
                                               chart.

Non-Accelerated Senior or NAS.............     A class that, for the period of
                                               time specified in the related
                                               prospectus supplement, generally
                                               will not receive (in other words,
                                               is locked out of) (1) principal
                                               prepayments on the underlying
                                               Trust Fund Assets that are
                                               allocated disproportionately to
                                               the senior securities because of
                                               the shifting interest structure
                                               of the securities in the trust
                                               and/or (2) scheduled principal
                                               payments on the underlying Trust
                                               Fund Assets, as specified in the
                                               related prospectus supplement.
                                               During the lock-out period, the
                                               portion of the principal
                                               distributions on the underlying
                                               Trust Fund Assets that the NAS
                                               class is locked out of will be
                                               distributed to the other classes
                                               of senior securities.

Notional Amount Securities................     A class having no principal
                                               balance and bearing interest on
                                               the related notional amount. The
                                               notional amount is used

                                       42


                                                          DEFINITION
       CATEGORIES OF CLASSES                           PRINCIPAL TYPES

                                               for purposes of the determination
                                               of interest distributions.

Planned Principal Class or PACs...........     A class that is designed to
                                               receive principal payments using
                                               a predetermined principal balance
                                               schedule derived by assuming two
                                               constant prepayment rates for the
                                               underlying Trust Fund Assets.
                                               These two rates are the endpoints
                                               for the "structuring range" for
                                               the planned principal class. The
                                               planned principal classes in any
                                               series of securities may be
                                               subdivided into different
                                               categories (e.g., primary planned
                                               principal classes, secondary
                                               planned principal classes, etc.)
                                               having different effective
                                               structuring ranges and different
                                               principal payment priorities. The
                                               structuring range for the
                                               secondary planned principal
                                               classes of a series will be
                                               narrower than that for the
                                               primary planned principal classes
                                               of that series.

Scheduled Principal Class.................     A class that is designed to
                                               receive principal payments using
                                               a predetermined principal balance
                                               schedule but is not designated as
                                               a planned principal class or
                                               targeted principal class. In many
                                               cases, the schedule is derived by
                                               assuming two constant prepayment
                                               rates for the underlying Trust
                                               Fund Assets. These two rates are
                                               the endpoints for the
                                               "structuring range" for the
                                               scheduled principal class.

Sequential Pay............................     Classes that receive principal
                                               payments in a prescribed
                                               sequence, that do not have
                                               predetermined principal balance
                                               schedules and that under all
                                               circumstances receive payments of
                                               principal continuously from the
                                               first Distribution Date on which
                                               they receive principal until they
                                               are retired. A single class that
                                               receives principal payments
                                               before or after all other classes
                                               in the same series may be
                                               identified as a sequential pay
                                               class.

Strip.....................................     A class that receives a constant
                                               proportion, or "strip," of the
                                               principal payments on the
                                               underlying Trust Fund Assets or
                                               other assets of the trust fund.

Support Class (also sometimes referred to as
"companion
classes").................................     A class that receives principal
                                               payments on any distribution date
                                               only if scheduled payments have
                                               been made on specified planned
                                               principal classes, targeted
                                               principal classes or scheduled
                                               principal classes.

                                       43

                                                          DEFINITION
       CATEGORIES OF CLASSES                           PRINCIPAL TYPES

Targeted Principal Class or TACs..........     A class that is designed to
                                               receive principal payments using
                                               a predetermined principal balance
                                               schedule derived by assuming a
                                               single constant prepayment rate
                                               for the underlying Trust Fund
                                               Assets.

                                               INTEREST TYPES

Fixed Rate................................     A class with an interest rate
                                               that is fixed throughout the life
                                               of the class.

Floating Rate.............................     A class with an interest rate
                                               that resets periodically based on
                                               a designated index and that
                                               varies directly with changes in
                                               the index.

Inverse Floating Rate.....................     A class with an interest rate
                                               that resets periodically based on
                                               a designated index and that
                                               varies inversely with changes in
                                               the index.

Variable Rate.............................     A class with an interest rate
                                               that resets periodically and is
                                               calculated by reference to the
                                               rate or rates of interest
                                               applicable to specified assets or
                                               instruments (e.g., the Loan Rates
                                               borne by the underlying loans).

Interest Only.............................     A class that receives some or all
                                               of the interest payments made on
                                               the underlying Trust Fund Assets
                                               or other assets of the trust fund
                                               and little or no principal.
                                               Interest only classes have either
                                               a nominal principal balance or a
                                               notional amount. A nominal
                                               principal balance represents
                                               actual principal that will be
                                               paid on the class. It is referred
                                               to as nominal because it is
                                               extremely small compared to other
                                               classes. A notional amount is the
                                               amount used as a reference to
                                               calculate the amount of interest
                                               due on an interest only class
                                               that is not entitled to any
                                               distributions of principal.

Principal Only............................     A class that does not bear
                                               interest and is entitled to
                                               receive only distributions of
                                               principal.

Partial Accrual...........................     A class that accretes a portion
                                               of the accrued interest on the
                                               class. The accreted amount will
                                               be added to the principal balance
                                               of the class on each applicable
                                               distribution date, with the
                                               remainder of the accrued interest
                                               to be distributed currently as
                                               interest on the class. The
                                               accretion may continue until a
                                               specified event has occurred or
                                               until the partial accrual class
                                               is retired.

                                       44

                                                          DEFINITION
       CATEGORIES OF CLASSES                           PRINCIPAL TYPES

Accrual...................................     A class that accretes all the
                                               accrued interest otherwise
                                               distributable on the class. The
                                               accreted amount will be added as
                                               principal to the principal
                                               balance of the class on each
                                               applicable distribution date. The
                                               accretion may continue until some
                                               specified event has occurred or
                                               until the accrual class is
                                               retired.



INDICES APPLICABLE TO FLOATING RATE AND INVERSE FLOATING RATE CLASSES

LIBOR

     The applicable prospectus supplement may specify some other basis for
determining LIBOR, but if it does not, on the LIBOR determination date (as
defined in the related prospectus supplement) for each class of securities of a
series for which the applicable interest rate is determined by reference to an
index called LIBOR, the person designated in the related agreement as the
calculation agent will determine LIBOR using one of the two methods described
below. The method will be specified in the related prospectus supplement.

LIBO Method

     If using this method to calculate LIBOR, the calculation agent will
determine LIBOR by reference to the quotations, as set forth on the Moneyline
Telerate Page 3750, offered by the principal London office of each of the
designated reference banks meeting the criteria set forth below for making
one-month United States dollar deposits in leading banks in the London Interbank
market, as of 11:00 a.m. (London time) on the LIBOR determination date. In lieu
of relying on the quotations for those reference banks that appear at the time
on the Moneyline Telerate Page 3750, the calculation agent will request each of
the reference banks to provide the offered quotations at that time.

     Under this method the calculation agent will establish LIBOR on each LIBOR
determination date as follows:

     (a) If on any LIBOR determination date two or more reference banks provide
offered quotations, LIBOR for the next interest accrual period will be the
arithmetic mean of the offered quotations (rounded up if necessary to the
nearest whole multiple of 1/16%).

     (b) If on any LIBOR determination date only one or none of the reference
banks provides offered quotations, LIBOR for the next interest accrual period
will be the arithmetic mean of the rates quoted by major banks in New York City,
selected by the calculation agent, at approximately 11:00 a.m. (New York City
time) on that day for loans in United States dollars to leading European banks.

     (c) If on any LIBOR determination date for a class specified in the related
prospectus supplement, the calculation agent is required but unable to determine
LIBOR according to paragraph (b) above, LIBOR for the next interest accrual
period will be LIBOR as determined on the preceding LIBOR determination date,
or, in the case of the first LIBOR determination date, LIBOR will be considered
to be the annual rate specified as such in the related prospectus supplement.

                                       45


     Each reference bank will be a leading bank engaged in transactions in
Eurodollar deposits in the international Eurocurrency market; will not control,
be controlled by, or be under common control with the calculation agent; and
will have an established place of business in London. If any reference bank
should be unwilling or unable to act as such or if appointment of a reference
bank is terminated, another leading bank meeting the criteria specified above
will be appointed.

BBA Method

     If using this method of determining LIBOR, the calculation agent will
determine LIBOR on the basis of the British Bankers' Association "Interest
Settlement Rate" for one-month deposits in United States dollars as found on
Moneyline Telerate Page 3750 as of 11:00 a.m. London time on each LIBOR
determination date. Interest Settlement Rates currently are based on rates
quoted by eight British Bankers' Association designated banks as being, in the
view of the banks, the offered rate at which deposits are being quoted to prime
banks in the London interbank market. The Interest Settlement Rates are
calculated by eliminating the two highest rates and the two lowest rates,
averaging the four remaining rates, carrying the result (expressed as a
percentage) out to six decimal places, and rounding to five decimal places.

     If on any LIBOR determination date, the calculation agent is unable to
calculate LIBOR as described in the preceding paragraph, LIBOR for the next
interest accrual period will be calculated as described above under "LIBO
Method."

     The calculation agent's determination of LIBOR on each LIBOR determination
date and its calculation of the interest rate for each applicable class for the
related interest accrual period shall (in the absence of manifest error) be
final and binding.

COFI

     The Eleventh District Cost of Funds Index is designed to represent the
monthly weighted average cost of funds for savings institutions in Arizona,
California and Nevada that are member institutions of the Eleventh Federal Home
Loan Bank District (the "Eleventh District"). The Eleventh District Cost of
Funds Index for a particular month reflects the interest costs paid on all types
of funds held by Eleventh District member institutions and is calculated by
dividing the cost of funds by the average of the total amount of those funds
outstanding at the end of that month and of the prior month and annualizing and
adjusting the result to reflect the actual number of days in the particular
month. If necessary, before these calculations are made, the component figures
are adjusted by the Federal Home Loan Bank of San Francisco ("FHLBSF") to
neutralize the effect of events such as member institutions leaving the Eleventh
District or acquiring institutions outside the Eleventh District. The Eleventh
District Cost of Funds Index is weighted to reflect the relative amount of each
type of funds held at the end of the relevant month. The major components of
funds of Eleventh District member institutions are: savings deposits, time
deposits, FHLBSF advances, repurchase agreements and all other borrowings.
Because the component funds represent a variety of maturities whose costs may
react in different ways to changing conditions, the Eleventh District Cost of
Funds Index does not necessarily reflect current market rates.

     A number of factors affect the performance of the Eleventh District Cost of
Funds Index, which may cause it to move in a manner different from indices tied
to specific interest rates, such as United States Treasury bills or LIBOR.
Because the liabilities upon which the Eleventh


                                       46


District Cost of Funds Index is based were issued at various times under various
market conditions and with various maturities, the Eleventh District Cost of
Funds Index may not necessarily reflect the prevailing market interest rates on
new liabilities of similar maturities. Moreover, as stated above, the Eleventh
District Cost of Funds Index is designed to represent the average cost of funds
for Eleventh District savings institutions for the month before the month in
which it is due to be published. Additionally, the Eleventh District Cost of
Funds Index may not necessarily move in the same direction as market interest
rates at all times, because as longer term deposits or borrowings mature and are
renewed at prevailing market interest rates, the Eleventh District Cost of Funds
Index is influenced by the differential between the prior and the new rates on
those deposits or borrowings. In addition, movements of the Eleventh District
Cost of Funds Index, as compared to other indices tied to specific interest
rates, may be affected by changes instituted by the FHLBSF in the method used to
calculate the Eleventh District Cost of Funds Index.

     The FHLBSF publishes the Eleventh District Cost of Funds Index in its
monthly Information Bulletin. Any individual may request regular receipt by mail
of Information Bulletins by writing the Federal Home Loan Bank of San Francisco,
P.O. Box 7948, 600 California Street, San Francisco, California 94120, or by
calling (415) 616-1000. The Eleventh District Cost of Funds Index may also be
obtained by calling the FHLBSF at (415) 616-2600.

     The FHLBSF has stated in its Information Bulletin that the Eleventh
District Cost of Funds Index for a month "will be announced on or near the last
working day" of the following month and also has stated that it "cannot
guarantee the announcement" of the index on an exact date. As long as the index
for a month is announced on or before the tenth day of the second following
month, the interest rate for each class of securities for which the interest
rate is determined by reference to an index denominated as COFI for the interest
accrual period beginning in that second following month will be based on the
Eleventh District Cost of Funds Index for the second preceding month. If
publication is delayed beyond the tenth day, the interest rate will be based on
the Eleventh District Cost of Funds Index for the third preceding month.

     The applicable prospectus supplement may specify some other basis for
determining COFI, but if it does not, then if on the tenth day of the month in
which any interest accrual period begins for a class of COFI securities, the
most recently published Eleventh District Cost of Funds Index relates to a month
before the third preceding month, the index for the current interest accrual
period and for each subsequent interest accrual period will be based (except as
described below) on the National Monthly Median Cost of Funds Ratio to
SAIF-Insured Institutions (the "National Cost of Funds Index") published by the
Office of Thrift Supervision (the "OTS") for the third preceding month (or the
fourth preceding month if the National Cost of Funds Index for the third
preceding month has not been published on the tenth day of an interest accrual
period). Information on the National Cost of Funds Index may be obtained by
writing the OTS at 1700 G Street, N.W., Washington, D.C. 20552 or calling (202)
906-6677, and the current National Cost of Funds Index may be obtained by
calling (202) 906-6988. If on the tenth day of the month in which an interest
accrual period begins, the most recently published National Cost of Funds Index
relates to a month before the fourth preceding month, the applicable index for
that interest accrual period and each succeeding interest accrual period will be
based on LIBOR, as determined by the calculation agent in accordance with the
agreement relating to that series. A change of index from the Eleventh District
Cost of Funds Index to an alternative index will result

                                       47


in a change in the index level and could increase its volatility, particularly
if the alternative index is LIBOR.

     The calculation agent's determination of COFI and its calculation of the
interest rates for the applicable classes for the related interest accrual
period shall (in the absence of manifest error) be final and binding.

Treasury Index

     The applicable prospectus supplement may specify some other basis for
determining and defining the Treasury index, but if it does not, on the Treasury
index determination date for each class of securities of a series for which the
applicable interest rate is determined by reference to an index denominated as a
Treasury index, the calculation agent will ascertain the Treasury index for
Treasury securities of the maturity and for the period (or, if applicable, the
date) specified in the related prospectus supplement. The Treasury index for any
period means the average of the yield for each business day during the specified
period (and the Treasury index for any date means the yield for that date),
expressed as an annual percentage rate, on U.S. Treasury securities adjusted to
the "constant maturity" specified in the prospectus supplement or if no
"constant maturity" is so specified, U.S. Treasury securities trading on the
secondary market having the maturity specified in the prospectus supplement, in
each case as published by the Federal Reserve Board in its Statistical Release
No. H.15 (519). Statistical Release No. H.15 (519) is published on Monday or
Tuesday of each week and may be obtained by writing or calling the Publications
Department at the Board of Governors of the Federal Reserve System, 21st and C
Streets, Washington, D.C. 20551 (202) 452-3244. If the calculation agent has not
yet received Statistical Release No. H.15 (519) for a week, then it will use the
Statistical Release from the preceding week.

     Yields on U.S. Treasury securities at "constant maturity" are derived from
the U.S. Treasury's daily yield curve. This curve, which relates the yield on a
security to its time to maturity, is based on the closing market bid yields on
actively traded Treasury securities in the over-the-counter market. These market
yields are calculated from composites of quotations reported by five leading
U.S. Government securities dealers to the Federal Reserve Bank of New York. This
method provides a yield for a given maturity even if no security with that exact
maturity is outstanding. If the Treasury index is no longer published, a new
index based on comparable data and methodology will be designated in accordance
with the agreement relating to the applicable series. The calculation agent's
determination of the Treasury index, and its calculation of the interest rates
for the applicable classes for the related interest accrual period shall (in the
absence of manifest error) be final and binding.

Prime Rate

     The applicable prospectus supplement may specify some other basis for
determining and defining the prime rate, but if it does not, on the prime rate
determination date for each class of securities for which the applicable
interest rate is determined by reference to an index denominated as the prime
rate, the calculation agent will ascertain the prime rate for the related
interest accrual period. The prime rate for an interest accrual period will be
the "prime rate" as published in the "Money Rates" section of The Wall Street
Journal on the related prime rate determination date, or if not so published,
the "prime rate" as published in a newspaper of

                                       48


general circulation selected by the calculation agent in its sole discretion. If
a prime rate range is given, then the average of the range will be used. If the
prime rate is no longer published, a new index based upon comparable data and
methodology will be designated in accordance with the agreement relating to the
applicable series. The calculation agent's determination of the prime rate and
its calculation of the interest rates for the related interest accrual period
shall (in the absence of manifest error) be final and binding.

DERIVATIVE TRANSACTIONS

     If specified in the related prospectus supplement, a trust fund may enter
into privately negotiated, over-the-counter hedging transactions with various
counterparties, for the purpose of effectively fixing the interest rate it pays
on one or more borrowings or series of borrowings These transactions include
interest rate and securities-based swaps, caps, collars and floors, and are
referred to as derivative transactions. Trust funds will use derivative
transactions as hedges and not as speculative investments. Derivative
transactions involve an agreement between two parties to exchange payments based
on variable interest rates for payments based on fixed interest rates. These
payments are calculated on the basis of a specified amount of principal for a
specified period of time.

     Cap and floor transactions involve an agreement between two parties in
which the first party agrees to pay the second when a designated market interest
rate goes above (in the case of a cap) or below (in the case of a floor) a
designated level on predetermined dates or during a specified time period.
Collar transactions involve an agreement between two parties in which the first
party pays the second when a designated market interest rate goes above a
designated level on predetermined dates or during a specified time period, and
the second party pays the first when a designated market interest rate goes
below a designated level on predetermined dates or during a specified time
period.

BOOK-ENTRY REGISTRATION OF SECURITIES


     If so specified in the related prospectus supplement, one or more classes
of securities of any series may be issued as book-entry securities. Persons
acquiring beneficial ownership interests in book-entry securities will hold
their securities either:

     o   directly through The Depository Trust Company ("DTC") in the United
         States, or Clearstream, Luxembourg or Euroclear in Europe, if they are
         participants of these systems, or

     o   indirectly through organizations that are participants in these
         systems.

     Each class of book-entry securities will be issued in one or more
certificates that equal the aggregate principal balance of the class and will
initially be registered in the name of Cede & Co. as the nominee of DTC.
Clearstream, Luxembourg and Euroclear will hold omnibus positions on behalf of
their participants through customers' securities accounts in Clearstream,
Luxembourg's or Euroclear's name, on the books of their respective depositaries.
These depositaries will in turn hold the positions in customers' securities
accounts in the depositaries' names on the books of DTC. Citibank, N.A. will act
as depositary for Clearstream, Luxembourg and The Chase Manhattan Bank will act
as depositary for Euroclear. Except as described below, no person acquiring a
beneficial interest in a book-entry security will be entitled to receive a
physical certificate representing the security.

                                       49


     The beneficial owner's ownership of a book-entry security will be recorded
on the records of the brokerage firm, bank, thrift institution or other
financial intermediary that maintains the beneficial owner's account for that
purpose. In turn, the financial intermediary's ownership of a book-entry
security will be recorded on the records of DTC (or of a participating firm that
acts as agent for the financial intermediary, whose interest will in turn be
recorded on the records of DTC, if the beneficial owner's financial intermediary
is not a DTC participant, and on the records of Clearstream, Luxembourg or
Euroclear, as appropriate). Therefore, the beneficial owner must rely on the
foregoing procedures to evidence its beneficial ownership of a book-entry
security. Beneficial ownership of a book-entry security may only be transferred
by compliance with the procedures of the financial intermediaries and depository
participants.

     Beneficial owners will receive all distributions of principal of and
interest on the securities from the trustee through DTC and its participants.
While the securities are outstanding (except under the circumstances described
below), DTC is required to make book-entry transfers of the securities among
participants on whose behalf it acts and is required to receive and transmit
distributions on the securities in accordance with rules, regulations and
procedures creating and affecting DTC and its operations. Participants and
indirect participants with whom beneficial owners have accounts are likewise
required to make book-entry transfers and receive and transmit distributions on
behalf of their respective beneficial owners. Although beneficial owners will
not possess physical certificates, the DTC rules, regulations and procedures
provide a mechanism by which beneficial owners may receive distributions on the
securities and transfer their interests in the securities.

     Beneficial owners will not receive or be entitled to receive certificates
representing their interests in the securities except under the limited
circumstances described below. Until definitive securities are issued,
beneficial owners who are not participants may transfer ownership of their
securities only through participants and indirect participants by instructing
them to transfer securities through DTC for the accounts of the purchasers of
those securities. In accordance with DTC's rules, regulations and procedures,
transfers of ownership will be executed through DTC, and the accounts of the
respective participants at DTC will be debited and credited. Similarly, the
participants and indirect participants will make the appropriate debits and
credits on their records on behalf of the selling and purchasing beneficial
owners.

     Because of time zone differences, credits of securities received in
Clearstream, Luxembourg or Euroclear resulting from transactions with
participants will be made during subsequent securities settlement processing and
dated the business day after the DTC settlement date. These credits, and any
transactions in the securities settled during processing, will be reported to
the applicable Euroclear or Clearstream, Luxembourg participants on that
business day. Cash received in Clearstream, Luxembourg or Euroclear resulting
from sales of securities by or through a Clearstream, Luxembourg participant
(described below) or Euroclear Participant (described below) to a DTC
participant will be received with value on the DTC settlement date but will not
be available in the applicable Clearstream, Luxembourg or Euroclear cash account
until the business day after settlement in DTC.

     Transfers between DTC participants will be governed by DTC rules. Transfers
between Clearstream, Luxembourg participants and Euroclear participants will be
governed by their respective rules and operating procedures.

                                       50


     Cross-market transfers between persons holding directly or indirectly
through DTC and persons holding directly or indirectly through Clearstream,
Luxembourg participants or Euroclear participants will be effected in DTC in
accordance with DTC rules on behalf of the applicable European international
clearing system by the applicable depositary. These cross-market transactions,
however, will require delivery of instructions to the applicable European
international clearing system by the counterparty in that system according to
its rules and procedures and within its established deadlines (European time).
If the transaction meets its settlement requirements, the applicable European
international clearing system will deliver instructions to the applicable
depositary to effect final settlement on its behalf by delivering or receiving
securities in DTC, and making or receiving payment in accordance with the
procedures for same day funds settlement applicable to DTC. Clearstream,
Luxembourg Participants and Euroclear Participants may not deliver instructions
directly to the European depositaries.

     Clearstream, Luxembourg is incorporated under the laws of Luxembourg as a
professional depository. Clearstream, Luxembourg holds securities for its
participating organizations and facilitates the clearance and settlement of
securities transactions between Clearstream, Luxembourg participants through
electronic book-entry changes in the participants' accounts, thereby eliminating
the need for physical transfer of certificates. Transactions may be settled in
Clearstream, Luxembourg in any of 30 currencies, including United States
dollars. Clearstream, Luxembourg provides its participants, among other things,
services for safekeeping, administration, clearance and settlement of
internationally traded securities and securities lending and borrowing.
Clearstream, Luxembourg interfaces with domestic markets in several countries.
As a professional depository, Clearstream, Luxembourg is subject to regulation
by the Luxembourg Monetary Institute. Clearstream, Luxembourg participants are
recognized financial institutions around the world, including underwriters,
securities brokers and dealers, banks, trust companies, clearing corporations
and certain other organizations. Indirect access to Clearstream, Luxembourg is
also available to other entities, such as banks, brokers, dealers and trust
companies that clear through or maintain a custodial relationship with a
Clearstream, Luxembourg participant, either directly or indirectly.

     Euroclear was created in 1968 to hold securities for its participants and
to clear and settle transactions between Euroclear participants through
simultaneous electronic book-entry delivery against payment, thereby eliminating
the need for physical transfer of certificates, as well as any risk from the
lack of simultaneous transfers of securities and cash. Transactions may be
settled in any of 32 currencies, including United States dollars. Euroclear
provides various other services, including securities lending and borrowing. It
also interfaces with domestic markets in several countries in a manner similar
to the arrangements for cross-market transfers with DTC described above.
Euroclear is operated by the Brussels, Belgium office of Morgan Guaranty Trust
Company of New York ("Morgan"), under contract with Euroclear Clearance Systems
S.C., a Belgian cooperative corporation. All operations are conducted by Morgan.
All Euroclear securities clearance accounts and Euroclear cash accounts are
accounts with Morgan, not Euroclear Clearance Systems S.C. Euroclear Clearance
Systems S.C. establishes policy for Euroclear on behalf of Euroclear
participants. Euroclear participants include banks (including central banks),
securities brokers and dealers and other professional financial intermediaries.
Indirect access to Euroclear is also available to other firms that clear through
or maintain a custodial relationship with a Euroclear participant, either
directly or indirectly.

                                       51



     Morgan is the Belgian branch of a New York banking corporation that is a
member bank of the Federal Reserve System. As such, it is regulated and examined
by the Board of Governors of the Federal Reserve System and the New York State
Banking Department, as well as by the Belgian Banking Commission.

     Securities clearance accounts and cash accounts with Morgan are governed by
the Terms and Conditions Governing Use of Euroclear and the related Operating
Procedures of the Euroclear System and applicable Belgian law. These laws and
rules govern transfers of securities and cash within Euroclear, withdrawals of
securities and cash from Euroclear, and receipt of payments with respect to
securities in Euroclear. All securities in Euroclear are held on a fungible
basis without attribution of specific certificates to specific securities
clearance accounts. Morgan, in its capacity as Euroclear operator, acts under
the laws and procedures described above only on behalf of Euroclear
participants, and has no record of or relationship with persons holding through
Euroclear participants.

     Under a book-entry format, beneficial owners of the book-entry securities
may experience some delay in their receipt of payments, because the trustee will
send payments to Cede & Co., as nominee of DTC. Distributions on securities held
through Clearstream, Luxembourg or Euroclear and received by the applicable
depositary will be credited to the cash accounts of Clearstream, Luxembourg
Participants or Euroclear Participants in accordance with each system's rules
and procedures. These distributions will be subject to tax reporting under the
applicable United States laws and regulations. See "Federal Income Tax
Consequences--Tax Treatment of Foreign Investors" and "--Tax Consequences to
Holders of the Notes--Backup Withholding" in this prospectus. Because DTC can
only act on behalf of financial intermediaries, the a beneficial owner's ability
to pledge book-entry securities to persons or entities that do not participate
in the DTC system, or otherwise take actions in respect of the book-entry
securities, may be limited by the lack of physical certificates for the
book-entry securities. In addition, issuance of the book-entry securities in
book-entry form may reduce the liquidity of those securities in the secondary
market because some potential investors may not want to purchase securities for
which they cannot obtain physical certificates.

     Until definitive securities are issued, it is anticipated that the only
"securityholder" of the book-entry securities will be Cede & Co., as nominee of
DTC. Beneficial owners are only permitted to exercise the rights of
securityholders indirectly through financial intermediaries and DTC. Monthly and
annual reports for the related trust fund will be provided to Cede & Co., as
nominee of DTC. Cede & Co. may make them available to beneficial owners upon
request, in accordance with the rules, regulations and procedures creating and
affecting DTC. It may also make them available to the financial intermediaries
to whose DTC accounts the book-entry securities of those beneficial owners are
credited.

     Until definitive securities are issued, DTC will take any action permitted
to be taken by the holders of the book-entry securities of a series under the
related agreement only at the direction of one or more financial intermediaries
to whose DTC accounts the book-entry securities are credited, to the extent that
the actions are taken on behalf of financial intermediaries whose holdings
include the book-entry securities. Clearstream, Luxembourg or Morgan (in its
capacity as Clearstream operator) will take any other action permitted to be
taken by a securityholder on behalf of a Clearstream, Luxembourg participant or
Euroclear participant, respectively, only in accordance with its applicable
rules and procedures and subject to the applicable depositary's ability to
effect actions on its behalf through DTC. At the direction of the related
participants,

                                       52


DTC may take actions with respect to some securities that conflict with actions
taken with respect to other securities.

     The applicable prospectus supplement may specify when and for what reasons
definitive securities may be issued, but if it does not, definitive securities
will be issued to beneficial owners of book-entry securities, or their nominees,
rather than to DTC, only if:

     o   DTC or the depositor advises the trustee in writing that DTC is no
         longer willing, qualified or able to discharge properly its
         responsibilities as nominee and depository with respect to the
         book-entry securities, and DTC or the trustee is unable to locate a
         qualified successor;

     o   the depositor, at its sole option, elects to terminate the book-entry
         system through DTC;

     o   or after the occurrence of an event of default, beneficial owners of
         securities representing not less than 51% of the aggregate percentage
         interests evidenced by each class of securities of the related series
         issued as book-entry securities advise the trustee and DTC through the
         financial intermediaries in writing that the continuation of a
         book-entry system through DTC (or a successor to it) is no longer in
         the best interests of the beneficial owners.

     Upon the occurrence of any of the events described in the preceding
paragraph, the trustee will be required to notify all beneficial owners of the
occurrence of the event and the availability of definitive securities through
DTC. Upon surrender by DTC of the global certificate or certificates
representing the book-entry securities and instructions for re-registration, the
trustee will issue the definitive securities, and thereafter the trustee will
recognize the holders of the definitive securities as securityholders under the
applicable agreement.

     Although DTC, Clearstream, Luxembourg and Euroclear have agreed to the
foregoing procedures in order to facilitate transfers of securities among
participants of DTC, Clearstream, Luxembourg and Euroclear, they are not
obligated to perform or continue to perform these procedures and these
procedures may be discontinued at any time.

     The master servicer, the depositor and the trustee will not be responsible
for any aspect of the records relating to or payments made on account of
beneficial ownership interests of the book-entry securities held by Cede & Co.,
as nominee of DTC, or for maintaining, supervising or reviewing any records
relating to the beneficial ownership interests.

                               CREDIT ENHANCEMENT

GENERAL

     Credit enhancement may be provided for one or more classes of a series of
securities or for the related Trust Fund Assets. Credit enhancement may be in
the form of a limited financial guaranty policy issued by an entity named in the
related prospectus supplement, the subordination of one or more classes of the
securities of the series, the establishment of one or more reserve accounts, the
use of a cross-collateralization feature, the use of a mortgage pool insurance
policy, FHA insurance, VA guarantee, bankruptcy bond, special hazard insurance
policy, surety bond, letter of credit, guaranteed investment contract,
overcollateralization, or other method of credit enhancement described in the
related prospectus supplement, or any combination of these forms. Unless
otherwise specified in the related prospectus supplement,

                                       53


credit enhancement will not provide protection against all risks of loss or
guarantee repayment of the entire principal balance of the securities and
interest on them. If losses occur that exceed the amount covered by credit
enhancement or that are not covered by the credit enhancement, securityholders
will bear their allocable share of any deficiencies.

SUBORDINATION

     If specified in the related prospectus supplement, the rights of holders of
one or more classes of subordinated securities will be subordinate to the rights
of holders of one or more classes of senior securities of the series to
distributions of scheduled principal, principal prepayments, interest or any
combination of those distributions that otherwise would have been payable to
holders of subordinated securities under the circumstances and to the extent
specified in the related prospectus supplement. If specified in the related
prospectus supplement, holders of senior securities also may be protected by a
reduction in the ownership interest, if any, of the related subordinated
securities or by any other method described in the related prospectus
supplement.

     If specified in the related prospectus supplement, delays in receiving
scheduled payments on the loans and losses on defaulted loans will be borne
first by the various classes of subordinated securities and thereafter by the
various classes of senior securities, in each case under the circumstances and
subject to the limitations specified in the related prospectus supplement. The
aggregate distributions of delinquent payments on the loans over the lives of
the securities or at any time, the aggregate losses on defaulted loans that must
be borne by the subordinated securities by virtue of subordination, and the
amount of the distributions otherwise distributable to the subordinated
securityholders that will be distributable to senior securityholders on any
distribution date may be limited as specified in the related prospectus
supplement. If aggregate distributions of delinquent payments on the loans or
aggregate losses on the loans were to exceed the amount specified in the related
prospectus supplement, holders of senior securities would experience losses on
their securities.

     In addition to or instead of the subordination methods listed above, the
prospectus supplement for a series may provide that all or a portion of the
distributions otherwise payable to holders of subordinated securities on any
distribution date will instead either be deposited into one or more reserve
accounts established with the trustee, or distributed to the holders of senior
securities. As specified in the related prospectus supplement, deposits into a
reserve account may be made on each distribution date, or for specified time
periods, or until the balance in the reserve account has reached a specified
amount and thereafter, to the extent necessary to maintain the balance in the
reserve account at any required level. Amounts on deposit in the reserve account
for a series may be released to the holders of certain classes of securities at
the times and under the circumstances specified in the related prospectus
supplement.

     If specified in the related prospectus supplement, various classes of
senior securities and subordinated securities may themselves be subordinate in
their right to receive certain distributions to other classes of senior and
subordinated securities, respectively, through a cross-collateralization
mechanism or otherwise.

     As between classes of senior securities and as between classes of
subordinated securities, distributions may be allocated among such classes in
the order of their scheduled final distribution dates, in accordance with a
schedule or formula, in relation to the occurrence of

                                       54


events, or otherwise, in each case as specified in the related prospectus
supplement. As between classes of subordinated securities, payments to holders
of senior securities on account of delinquencies or losses and payments to any
reserve account will be allocated as specified in the related prospectus
supplement.

LETTER OF CREDIT

     Any letter of credit for a series of securities will be issued by the bank
or financial institution specified in the related prospectus supplement. The
specified bank will be obligated to honor drawings under the letter of credit in
an aggregate fixed dollar amount, net of unreimbursed payments under the letter
of credit, equal to a specified percentage of the aggregate principal balance
of:

     o   the loans on the related cut-off date, or

     o   one or more classes of securities.

     If 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 be reduced by the amount of unreimbursed payments under the
letter of credit. The obligations of the bank issuing a letter of credit for any
series of securities will expire at the earlier of the date specified in the
related prospectus supplement or the termination of the trust fund. See "The
Agreements--Termination: Optional Termination." A copy of any letter of credit
for a series will be filed with the SEC as an exhibit to a Current Report on
Form 8-K to be filed within 15 days of issuance of the securities of that
series.

INSURANCE POLICIES, SURETY BONDS AND GUARANTIES

     If specified in the prospectus supplement for a series of securities,
deficiencies in amounts otherwise payable on the securities or on certain
classes of them will be covered by insurance policies or surety bonds provided
by one or more insurance companies or sureties. These instruments may cover
timely distributions of interest or full distributions of principal or both,
based on a schedule of principal distributions specified or determined in the
manner specified in the related prospectus supplement. In addition, if specified
in the related prospectus supplement, a trust fund may also include bankruptcy
bonds, special hazard insurance policies, other insurance or guaranties for the
purpose of:

     o   maintaining timely payments or providing additional protection against
         losses on the assets included in the trust fund,

     o   paying administrative expenses, or

     o   establishing a minimum reinvestment rate on the payments made on the
         assets or a principal payment rate on the assets.

These arrangements may include agreements under which securityholders are
entitled to receive amounts deposited in various accounts held by the trustee on
the terms specified in the

                                       55


prospectus supplement. A copy of any such instrument for a series will be filed
with the SEC as an exhibit to a Current Report on Form 8-K to be filed within 15
days of issuance of the securities of that series.

OVER-COLLATERALIZATION

     If provided in the prospectus supplement for a series, a portion of the
interest payment on each loan may be applied as an additional distribution in
respect of principal to reduce the principal balance of a particular class or
classes of securities and, thus, accelerate the rate of principal payments on
the specified class or classes. Reducing the principal balance of the securities
without a corresponding reduction in the principal balance of the underlying
loans will result in over-collateralization.

RESERVE ACCOUNTS

     If specified in the related prospectus supplement, credit support for a
series of securities will be provided by one or more reserve accounts held by
the trustee, in trust, for the series of securities. The related prospectus
supplement will specify whether or not a reserve account will be included in the
trust fund for a series.

     The reserve account for a series will be funded by:

     o   a deposit of cash, U.S. Treasury securities or instruments evidencing
         ownership of principal or interest payments on U.S. Treasury
         securities, letters of credit, demand notes, certificates of deposit,
         or a combination of those types of funds in an aggregate amount
         specified in the related prospectus supplement,

     o   a deposit from time to time of amounts specified in the related
         prospectus supplement to which the subordinated securityholders, if
         any, would otherwise be entitled, or

     o   any other manner specified in the related prospectus supplement.

     Any amounts on deposit in the reserve account and the proceeds of any other
instrument deposited in it upon maturity will be held in cash or will be
invested in permitted investments. The applicable prospectus supplement may
specify a different definition of permitted investments, but if it does not,
then permitted investments will include obligations of the United States and
specified agencies of the United States, certificates of deposit, specified
commercial paper, time deposits and bankers acceptances sold by eligible
commercial banks and specified repurchase agreements for United States
government securities with eligible commercial banks. If a letter of credit is
deposited with the trustee, the letter of credit will be irrevocable. Generally,
any deposited instrument will name the trustee, in its capacity as trustee for
the holders of the securities, as beneficiary and will be issued by an entity
acceptable to each rating agency that rates the securities of the related
series. Additional information about the instruments deposited in the reserve
accounts will be specified in the related prospectus supplement.

     Any amounts and payments on instruments deposited in a reserve account will
be available for withdrawal from that reserve account for distribution to the
securityholders for the purposes, in the manner and at the times specified in
the related prospectus supplement.

                                       56



POOL INSURANCE POLICIES

     If specified in the related prospectus supplement, a separate pool
insurance policy will be obtained for the pool and issued by the insurer named
in the prospectus supplement. Each pool insurance policy will, subject to policy
limitations, cover losses caused by defaults in payment on loans in the pool.
The insurance will be in an amount equal to a specified percentage of the
aggregate principal balance (as of the cut-off date) of the loans that are not
covered as to their entire outstanding principal balances by primary mortgage
guaranty insurance policies. As described in the related prospectus supplement,
the master servicer will present claims under the insurance policy to the pool
insurer on behalf of itself, the trustee and the securityholders. The pool
insurance policies are not blanket policies against loss, because claims under
those policies may be made only for particular defaulted loans and only upon
satisfaction of conditions precedent in the policy. The applicable prospectus
supplement may specify that pool insurance will cover the failure to pay or the
denial of a claim under a primary mortgage guaranty insurance policy, but if it
does not, the pool insurance policies will not cover losses due to a failure to
pay or denial of a claim under a primary mortgage guaranty insurance policy.

     The original amount of coverage under each pool insurance policy will be
maintained to the extent provided in the related prospectus supplement and may
be reduced over the life of the related securities by the aggregate dollar
amount of claims paid less the aggregate of the net amounts realized by the pool
insurer upon disposition of all foreclosed properties. The applicable prospectus
supplement may provide that the claims paid will be net of master servicer
expenses and accrued interest, but if it does not, then the amount of claims
paid will include certain expenses incurred by the master servicer as well as
accrued interest on delinquent loans to the date of payment of the claim.
Accordingly, if aggregate net claims paid under any pool insurance policy reach
the original policy limit, coverage under that pool insurance policy will be
exhausted and any further losses will be borne by the securityholders.


FINANCIAL INSTRUMENTS


     If specified in the related prospectus supplement, the trust fund may
include one or more swap arrangements or other financial instruments that are
intended to meet the following goals:

     o to convert the payments on some or all of the mortgage loans from fixed
     to floating payments, or from floating to fixed, or from floating based on
     a particular index to floating based on another index;

     o to provide payments in the event that any index rises above or falls
     below specified levels; or

     o to provide protection against interest rate changes, certain types of
     losses, including reduced market value, or the payment shortfalls to one or
     more classes of the related series.

     If a trust fund includes financial instruments of this type, the
instruments may be structured to be exempt from the registration requirements of
the Securities Act of 1933, as amended.

CROSS-COLLATERALIZATION

     If specified in the related prospectus supplement, the beneficial ownership
of separate groups of assets included in a trust fund may be evidenced by
separate classes of the related series of securities. In that case, credit
support may be provided by a cross-collateralization feature requiring that
distributions be made on securities evidencing a beneficial ownership interest
in, or secured by, other asset groups within the same trust fund before
distributions are made on subordinated securities evidencing a beneficial
ownership interest in,

                                       57


or secured by, one or more other asset groups in that trust fund.
Cross-collateralization may be provided by:

     o   allocating specified excess amounts generated by one or more asset
         groups to one or more other asset groups in the same trust fund, or

     o   allocating losses with respect to one or more asset groups to one or
         more other asset groups in the same trust fund.

As described in more detail in the related prospectus supplement, these losses
or excess amounts, as the case may be, will be allocated to the outstanding
class or classes of subordinated securities of the related series having the
lowest rating assigned by any rating agency or the lowest payment priority. The
prospectus supplement for a series that includes a cross-collateralization
feature will describe the manner and conditions for applying the
cross-collateralization feature.

     If specified in the related prospectus supplement, the coverage provided by
one or more forms of credit support may apply concurrently to two or more
separate trust funds. If applicable, the related prospectus supplement will
identify the trust funds to which the credit support relates and the manner of
determining the amount of coverage provided by it and of the application of the
coverage to the identified trust funds.

                       YIELD AND PREPAYMENT CONSIDERATIONS

     The yields to maturity and weighted average lives of the securities will
depend primarily on the amount and timing of principal payments received on or
in respect of the related Trust Fund Assets. The original terms to maturity of
the loans in a given pool will vary depending on the type of loans. Each
prospectus supplement will contain information about the type and maturities of
the loans in the related pool. The applicable prospectus supplement may state
that some loans provide for prepayment penalties, but if it does not, then the
loans may be prepaid without penalty in full or in part at any time. The
prepayment experience on the loans in a pool will affect the weighted average
lives of the related securities.

     The rate of prepayment on the loans cannot be predicted. Home equity loans
and home improvement contracts have been originated in significant volume only
during the past few years and the depositor is not aware of any publicly
available studies or statistics on the prepayment rate of these loans.
Generally, borrowers do not view home equity loans and home improvement
contracts as permanent financing. Accordingly, those loans may experience a
higher prepayment rate than traditional first mortgage loans. On the other hand,
because home equity loans such as revolving credit line loans generally are not
fully amortizing, the absence of voluntary borrower prepayments could cause
principal payment rates to be similar to, or lower than, the rates associated
with traditional fully-amortizing first mortgage loans.

     A number of factors may affect the prepayment experience of the loans,
including general economic conditions, prevailing interest rates, the
availability of alternative financing, homeowner mobility and the frequency and
amount of future draws on any revolving credit line loans. Other factors that
might affect the prepayment rate of a pool of home equity loans or home
improvement contracts include the amount of, and interest rates on, the related
senior mortgage loans, and the fact that subordinate mortgage loans are
generally used for shorter-term financing for a variety of purposes, including
home improvement, education expenses and purchases of

                                       58


consumer goods such as automobiles. In addition, any future limitations on
borrowers' right to deduct interest payments on home equity loans for federal
income tax purposes may further increase the rate of prepayments of the loans.
The enforcement of a due-on-sale provision (described below) will have the same
effect as a prepayment of the related loan. See "Certain Legal Aspects of the
Loans-Due-on-Sale Clauses." If you buy securities in the secondary market at a
price other than par, your yield may vary from the yield you anticipated if the
prepayment rate on the loans is different from the rate you anticipated when you
bought the securities.

     Collections on revolving credit line loans may vary because, among other
things, borrowers may:

     o   make payments as low as the minimum monthly payment for any month,

     o   make payments consisting only of the interest, fees and charges for a
         given month during the interest-only period for certain revolving
         credit line loans (and, in more limited circumstances, in the case of
         closed-end loans for which an interest-only payment option has been
         selected), or

     o   make payments as high as the entire outstanding principal balance plus
         accrued interest, fees and charges on that loan.

In addition, borrowers may fail to make the required periodic payments.
Collections on the loans also may vary due to seasonal purchasing and borrowers'
payment habits.

     The applicable prospectus supplement may indicate that some conventional
loans do not have due-on-sale provisions, but if it does not, then all
conventional loans will contain due-on-sale provisions permitting the mortgagee
to accelerate the maturity of the loan upon sale or specified transfers of the
related property by the borrower. Loans insured by the FHA, and loans partially
guaranteed by the VA, are assumable with the consent of the FHA and the VA,
respectively. Thus, the rate of prepayments on those loans may be lower than
that on conventional loans bearing comparable interest rates. The master
servicer generally will enforce any due-on-sale or due-on-encumbrance clause, if
it has knowledge of the conveyance or further encumbrance (or the proposed
conveyance or proposed further encumbrance) of the property, and reasonably
believes that it is entitled to do so under applicable law. However, the master
servicer will not take any enforcement action that would impair or threaten to
impair any recovery under any related insurance policy. See "The
Agreements--Collection Procedures" and "Certain Legal Aspects of the Loans" for
a description of certain provisions of each agreement and certain legal
developments that may affect the prepayment experience on the loans.

     The rate of prepayments of conventional mortgage loans has fluctuated
significantly in recent years. In general, if prevailing rates fall
significantly below the Loan Rates borne by the loans, the loans are more likely
to be subject to higher prepayment rates than if prevailing interest rates
remain at or above the Loan Rates. Conversely, if prevailing interest rates rise
appreciably above the Loan Rates borne by the loans, the loans are more likely
to experience a lower prepayment rate than if prevailing rates remain at or
below the Loan Rates. However, there can be no assurance that this will be the
case.

     When a full prepayment is made on a loan, the borrower is charged interest
on the principal amount of the loan prepaid only for the number of days in the
month actually elapsed up to the date of the prepayment, rather than for a full
month. Thus, in most cases, the effect of prepayments in full will be to reduce
the amount of interest passed through or paid in the

                                       59


following month to securityholders. Partial prepayments in a given month may be
applied to the outstanding principal balances of the loans prepaid on the first
day of the month of receipt or the month following receipt. In the latter case,
partial prepayments will not reduce the amount of interest passed through or
paid in that month. Unless the related prospectus supplement provides otherwise,
neither full nor partial prepayments will be passed through or paid until the
month following receipt.

     Even if the properties underlying the loans held in the trust fund provide
adequate security for the loans, substantial delays could occur before defaulted
loans are liquidated and their proceeds are forwarded to investors. Property
foreclosure actions are regulated by state statutes and rules and are subject to
many of the delays and expenses of other lawsuits if defenses or counterclaims
are made, sometimes requiring several years to complete. In addition, in some
states, if the proceeds of the foreclosure are insufficient to repay the loan,
the borrower is not liable for the deficit. If a borrower defaults, these
restrictions may impede the master servicer's ability to dispose of the property
and obtain sufficient proceeds to repay the loan in full. In addition, the
master servicer will be entitled to deduct from liquidation proceeds all
expenses reasonably incurred in attempting to recover on the defaulted loan,
including payments to senior lienholders, legal fees and costs, real estate
taxes, and property maintenance and preservation expenses.

     Liquidation expenses of defaulted loans generally do not vary directly with
the outstanding principal balance of the loan at the time of default. Therefore,
if a servicer takes the same steps for a defaulted loan having a small remaining
principal balance as it does for a defaulted loan having a large remaining
principal balance, the amount realized after expenses is a smaller percentage of
the outstanding principal balance of the small loan than it is for the defaulted
loan with a large remaining principal balance.

     State laws generally regulate interest rates and other charges, require
certain disclosures, and require licensing of mortgage loan originators and
servicers. In addition, most states have other laws and public policies for the
protection of consumers that prohibit unfair and deceptive practices in the
origination, servicing and collection of mortgage loans. Depending on the
particular law and the specific facts involved, violations may limit the ability
of the master servicer to collect all or part of the principal or interest on
the underlying loans held in the trust fund. In some cases, the borrower may
even be entitled to a refund of amounts previously paid. In addition, damages
and administrative sanctions could be imposed on the master servicer.

     If the rate at which interest is passed through or paid to securityholders
is calculated on a loan-by-loan basis, disproportionate principal prepayments
among loans with different Loan Rates will affect the yields on those
securities. In most cases, the effective yield to securityholders will be lower
than the yield otherwise produced by the applicable pass-through rate or
interest rate and purchase price, because although interest will accrue on each
loan from the first day of the month (unless the related prospectus supplement
provides otherwise), the interest will not be distributed until the month
following the month of accrual.

     Under specified circumstances, the master servicer, the holders of the
residual interests in a REMIC or any person specified in the related prospectus
supplement may have the option to purchase the assets of a trust fund, thereby
causing an earlier retirement of the related series of securities. See "The
Agreements--Termination; Optional Termination."

                                       60


     Factors other than those identified in this prospectus and the related
prospectus supplement could significantly affect principal prepayments at any
time and over the lives of the securities. The relative contribution of the
various factors affecting prepayment also may vary from time to time. There can
be no assurance as to the rate of principal payment of the Trust Fund Assets at
any time or over the lives of the securities.

     The prospectus supplement relating to a series of securities will discuss
in greater detail the effect of the rate and timing of principal payments
(including prepayments), delinquencies and losses on the yield, weighted average
lives and maturities of the securities.

                                 THE AGREEMENTS

     The following is a summary of the material provisions of each agreement
that are not described elsewhere in this prospectus. Where particular provisions
or terms used in the agreements are referred to, the provisions or terms are as
specified in the related agreement.

ASSIGNMENT OF THE TRUST FUND ASSETS

     At the time of issuance of the securities of a series, the depositor will
cause the loans comprising the related trust fund to be assigned to the trustee,
without recourse, together with all principal and interest received (if the
loans are sold based on actual principal balances) or scheduled to be received
(if the loans are sold based on scheduled principal balances) by or on behalf of
the depositor on or with respect to the loans after the cut-off date (other than
any retained interest specified in the related prospectus supplement).
Concurrently with the assignment, the trustee will deliver the securities to the
depositor in exchange for the loans. Each loan will be identified in a schedule
appearing as an exhibit to the related agreement. The schedule will include the
outstanding principal balance of each loan after application of payments due on
or before the cut-off date, as well as the Loan Rate or APR, the maturity of
each loan, the Loan-to-Value Ratios or Combined Loan-to-Value Ratios, as
applicable, at origination and other specified information.

     Unless otherwise specified in the related prospectus supplement, the
agreement will require that on or before the closing date, the depositor will
deliver or cause to be delivered to the trustee (or to the custodian) with
respect to each single family loan or multifamily loan:

     o   the mortgage note or contract endorsed without recourse in blank or to
         the order of the trustee,

     o   the mortgage, deed of trust or similar instrument with evidence of
         recording indicated on it (except for any mortgage not returned from
         the public recording office, in which case the depositor will deliver
         or cause to be delivered a copy of the mortgage together with a
         certificate that the original of the mortgage was delivered to the
         recording office),

     o   an assignment of the mortgage to the trustee in recordable form in the
         case of a mortgage assignment, and

     o   any other security documents specified in the related prospectus
         supplement or agreement, including security documents relating to any
         senior interests in the property.

The applicable prospectus supplement may provide other arrangements for assuring
the priority of the assignments, but if it does not, then the depositor will
promptly cause the assignments of the related loans to be recorded in the
appropriate public office for real property records, except

                                       61


in states in which, in the opinion of counsel, recording is not required to
protect the trustee's interest in the loans against the claim of any subsequent
transferee or any successor to or creditor of the depositor or the originator of
the loans.

     For any loans that are cooperative loans, the depositor will cause to be
delivered to the trustee:

     o   the related original cooperative note endorsed without recourse in
         blank or to the order of the trustee,

     o   the original security agreement,

     o   the proprietary lease or occupancy agreement,

     o   the recognition agreement,

     o   an executed financing agreement, and

     o   the relevant stock certificate, related blank stock powers and any
         other document specified in the related prospectus supplement.

The depositor will cause to be filed in the appropriate office an assignment and
a financing statement evidencing the trustee's security interest in each
cooperative loan.

     For any loans that are home equity loans, the applicable prospectus
supplement will specify whether the documents relating to those loans will have
to be delivered to the trustee (or a custodian) and whether assignments of the
related mortgage to the trustee will be recorded. If documents need not be
delivered, the master servicer will retain them.

     For any home improvement contracts, the applicable prospectus supplement
will specify whether the documents relating to those contracts will have to be
delivered to the trustee (or a custodian). However, unless specified in the
related prospectus supplement, the depositor will not deliver to the trustee the
original mortgage securing a home improvement contract. In order to give notice
of the right, title and interest of securityholders to the home improvement
contracts, the depositor will cause a UCC-1 financing statement to be executed
by the depositor or the seller, identifying the trustee as the secured party and
identifying all home improvement contracts as collateral. Unless otherwise
specified in the related prospectus supplement, the home improvement contracts
will not be stamped or otherwise marked to reflect their assignment to the
trustee. Therefore, if, through negligence, fraud or otherwise, a subsequent
purchaser takes physical possession of the home improvement contracts without
notice of the assignment, the securityholders' interest in the home improvement
contracts could be defeated. See "Certain Legal Aspects of the Loans--The Home
Improvement Contracts."

     The trustee (or the custodian) will review the loan documents after
receiving them, within the time period specified in the related prospectus
supplement, and will hold the documents in trust for the benefit of the
securityholders. Generally, if a document is found to be missing or defective in
any material respect, the trustee (or custodian) will notify the master servicer
and the depositor, and the master servicer will notify the related seller. If,
after receiving notice, the seller cannot cure the omission or defect within the
time period specified in the related prospectus supplement, and such omission or
defect materially and adversely affects the interests of the securityholders in
the related mortgage loan, it will be obligated to:

     o   purchase the related loan from the trust fund at the Purchase Price or,

                                       62


     o   if specified in the related prospectus supplement, replace the loan
         with another loan that meets specified requirements.

There can be no assurance that a seller will fulfill this purchase or
substitution obligation. Although the master servicer may be obligated to
enforce the seller's obligation, the master servicer will not be obligated to
purchase or replace the loan if the seller defaults on its obligation (nor will
the master servicer otherwise be obligated to purchase or replace any loan for
any other reason). See "Loan Program--Representations by Sellers; Repurchases"
in this prospectus. The applicable prospectus supplement may provide other
remedies, but if it does not, then this obligation of the seller constitutes the
sole remedy available to the securityholders or the trustee for omission of, or
a material defect in, a constituent document.

     Notwithstanding the repurchase obligations described above, no purchase or
substitution of a loan will be made with respect to a trust fund for which a
REMIC election is to be made if the purchase or substitution would result in a
prohibited transaction tax under the Code (unless the master servicer or a
holder of the related residual certificate otherwise pays that tax from its own
funds). See "Loan Program--Representations by Sellers; Repurchases."

     The trustee will be authorized to appoint a custodian pursuant to a
custodial agreement to maintain possession of and, if applicable, to review the
documents relating to the loans as agent of the trustee.


PAYMENTS ON LOANS; DEPOSITS TO SECURITY ACCOUNT


     The master servicer will establish and maintain or cause to be established
and maintained for each trust fund a separate account or accounts for the
collection of payments on the related Trust Fund Assets (the "Security
Account"). The applicable prospectus supplement may provide for other
requirements for the Security Account, but if it does not, then the Security
Account must be either

     o   maintained with a depository institution the debt obligations of which
         (or in the case of a depository institution that is the principal
         subsidiary of a holding company, the obligations of which) are rated in
         one of the two highest rating categories by the nationally recognized
         statistical rating organizations that rated one or more classes of the
         related series of securities, or

     o   an account or accounts the deposits in which are fully insured by
         either the Bank Insurance Fund (the "BIF") of the FDIC or the Savings
         Association Insurance Fund (as successor to the Federal Savings and
         Loan Insurance Corporation ("SAIF")), or

     o   an account or accounts the deposits in which are insured by the BIF or
         SAIF to the limits established by the FDIC, and the uninsured deposits
         in which are otherwise secured such that, as evidenced by an opinion of
         counsel, the securityholders have a claim with respect to the funds in
         the Security Account or a perfected first priority security interest
         against any collateral securing the funds that is superior to the
         claims of any other depositors or general creditors of the depository
         institution with which the Security Account is maintained, or

     o   an account or accounts otherwise acceptable to each rating agency that
         rated one or more classes of the related series of securities.

                                       63


The collateral eligible to secure amounts in the Security Account is limited to
specified permitted investments. A Security Account may be maintained as an
interest bearing account, or the funds held in it may be invested in specified
permitted investments pending each succeeding distribution date. The related
prospectus supplement will specify whether the master servicer or its designee
will be entitled to receive the interest or other income earned on funds in the
Security Account as additional compensation and will be obligated to deposit in
the Security Account the amount of any loss immediately as realized. The
Security Account may be maintained with the master servicer or with a depository
institution that is an affiliate of the master servicer, as long as it meets the
criteria specified above.

     The master servicer will deposit or cause to be deposited in the Security
Account for each trust fund (to the extent applicable and unless the related
prospectus supplement or agreement provides for a different deposit arrangement)
the following payments and collections received or advances made by or on behalf
of it after the cut-off date (other than payments due on or before the cut-off
date and exclusive of any amounts representing any retained interest):

     o   all payments on account of principal, including principal prepayments
         and, if specified in the related prospectus supplement, any applicable
         prepayment penalties, on the loans;

     o   all payments on account of interest on the loans, net of applicable
         servicing compensation; o o all proceeds (net of unreimbursed payments
         of property taxes, insurance premiums and similar items) incurred, and
         unreimbursed advances made, by the master servicer) of the hazard
         insurance policies and any primary mortgage guaranty insurance
         policies, to the extent the proceeds are not applied to the restoration
         of the property or released to the mortgagor in accordance with the
         master servicer's normal servicing procedures, and all other cash
         amounts (net of unreimbursed expenses incurred in connection with
         liquidation or foreclosure and unreimbursed advances made, by the
         master servicer) received and retained in connection with the
         liquidation of defaulted 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 securityholders by foreclosure or
         deed in lieu of foreclosure;

     o   all proceeds of any loan or property in respect thereof purchased by
         the master servicer, the depositor or any seller as described under
         "Loan Program--Representations by Sellers; Repurchases" or "The
         Agreements--Assignment of the Trust Fund Assets," and all proceeds of
         any loan repurchased as described under "The Agreements--Termination;
         Optional Termination";

     o   all payments required to be deposited in the Security Account with
         respect to any deductible clause in any blanket insurance policy
         described under "--Hazard Insurance";

     o   any amount required to be deposited by the master servicer in
         connection with losses realized on investments for the benefit of the
         master servicer of funds held in the Security Account and, to the
         extent specified in the related prospectus supplement, any payments
         required to be made by the master servicer in connection with
         prepayment interest shortfalls; and

     o   all other amounts required to be deposited in the Security Account
         pursuant to the applicable agreement.

                                       64


     The master servicer (or the depositor, as applicable) may from time to time
direct the institution that maintains the Security Account to withdraw funds
from the Security Account for the following purposes:

     o   to pay to the master servicer the servicing fees described in the
         related prospectus supplement, the master servicing fees (subject to
         reduction) and, as additional servicing compensation, earnings on or
         investment income with respect to funds in the amounts in the Security
         Account credited thereto;

     o   to reimburse the master servicer for advances; provided, however, that
         the right of reimbursement with respect to any loan is limited to
         amounts received that represent late recoveries of payments of
         principal and interest on the loan (or insurance proceeds or
         liquidation proceeds from the loan);

     o   to reimburse the master servicer for any advances previously made that
         the master servicer has determined to be nonrecoverable;

     o   to reimburse the master servicer from insurance proceeds for expenses
         incurred by the master servicer and covered by the related insurance
         policies;

     o   to reimburse the master servicer for unpaid master servicing fees and
         unreimbursed out-of-pocket costs and expenses incurred by the master
         servicer in performing its servicing obligations; provided, however
         that the right of reimbursement is limited to amounts received
         representing late recoveries of the payments for which the advances
         were made;

     o   to reimburse the master servicer or the depositor for expenses incurred
         and reimbursable pursuant to the applicable agreement;

     o   to withdraw any amount deposited in the Security Account that was not
         required to be deposited in it; and o o to clear and terminate the
         Security Account upon termination of the applicable agreement.

     In addition, the related prospectus supplement will generally provide that
on or before the business day preceding each distribution date, the master
servicer shall withdraw from the Security Account the amount of Available Funds,
to the extent on deposit, for deposit in an account maintained by the trustee
for the related series of securities.

PRE-FUNDING ACCOUNT

     If specified in the related prospectus supplement, the master servicer will
establish and maintain a pre-funding account, in the name of the related trustee
on behalf of the related securityholders, into which the depositor will deposit
the pre-funded amount in cash on the related closing date. The pre-funding
account will be maintained with the trustee for the related series of securities
and is designed solely to hold funds that the trustee will use during the
funding period to pay the purchase price for subsequent loans to the depositor.
Monies on deposit in the pre-funding account will not be available to cover
losses on or in respect of the related loans. The pre-funded amount will not
exceed 50% of the initial aggregate principal amount of the certificates and
notes of the related series. The applicable trustee will use the pre-funded
amount to purchase subsequent loans from the depositor from time to time during
the funding period. Each funding period will begin on the related closing date
and will end on the date

                                       65


specified in the related prospectus supplement (or at the latest, one year after
the related closing date). Monies on deposit in the pre-funding account may be
invested in permitted investments under the circumstances and in the manner
described in the related agreement. Investment earnings on funds in a
pre-funding account will be deposited into the related Security Account or other
trust account specified in the related prospectus supplement. Any investment
losses will be charged against the funds on deposit in the pre-funding account.
Any amounts remaining in the pre-funding account at the end of the funding
period will be distributed to the related securityholders in the manner and
priority specified in the related prospectus supplement, as a prepayment of
principal of the related securities.

     In addition, if provided in the related prospectus supplement, on the
closing date for the related series, the depositor will deposit in an account
(the "Capitalized Interest Account") cash in an amount needed to cover
shortfalls in interest on the related series of securities that may arise by
using the pre-funding account as described above. The Capitalized Interest
Account shall be maintained with the trustee for the related series of
securities and is designed solely to cover those interest shortfalls. Monies on
deposit in the Capitalized Interest Account will not be available to cover
losses on or in respect of the related loans. If the entire amount on deposit in
a Capitalized Interest Account has not been used to cover shortfalls in interest
on the related series of securities by the end of the related funding period,
any amounts remaining in that Capitalized Interest Account will be paid to the
depositor.

SUB-SERVICING BY SELLERS

     Each seller of a loan or any other servicing entity may act as the
sub-servicer for that loan pursuant to a sub-servicing agreement, which will not
contain any terms inconsistent with the other related agreements. Each
sub-servicing agreement will be a contract solely between the master servicer
and the sub-servicer. However, the agreement pursuant to which a series of
securities is issued will provide that, if for any reason the master servicer
for that series is no longer the master servicer of the related loans, the
trustee or any successor master servicer must recognize the sub-servicer's
rights and obligations under the sub-servicing agreement.

     All references in this prospectus and the related prospectus supplement to
actions, rights or duties of the master servicer will be deemed to include any
and all sub-servicers acting on the master servicer's behalf. The master
servicer will remain liable for its servicing duties and obligations under the
master servicing agreement as if it alone were servicing the loans, to the
extent specified in the related prospectus supplement.

COLLECTION PROCEDURES

     The master servicer will make reasonable efforts to collect all payments
called for under the loans. In addition, the master servicer will, consistent
with each agreement and any pool insurance policy, primary mortgage guaranty
insurance policy, FHA insurance, VA guaranty, bankruptcy bond or alternative
arrangements, follow the collection procedures it customarily follows for loans
that are comparable to these loans. Consistent with the above, the master
servicer may, in its discretion, waive any assumption fee, late payment or other
charge in connection with a loan and arrange with a borrower a schedule for the
liquidation of delinquencies to the extent not inconsistent with the coverage of
that loan by a pool insurance policy, primary mortgage guaranty insurance
policy, FHA insurance, VA guaranty, bankruptcy bond or alternative arrangements,
if applicable. If the master servicer is obligated to make

                                       66


advances (or cause them to be made), the obligation will remain in effect during
any period of such an arrangement. Notwithstanding the foregoing, in connection
with a defaulting mortgage loan, the master servicer, consistent with the
standards set forth in the pooling and servicing agreement, may waive, modify or
vary any term of that mortgage loan (including modifications that change the
mortgage rate, forgive the payment of principal or interest or extend the final
maturity date of that mortgage loan), accept payment from the related mortgagor
of an amount less than the stated principal balance in final satisfaction of
that mortgage loan, or consent to the postponement of strict compliance with any
such term or otherwise grant indulgence to any mortgagor if in the master
servicer's determination such waiver, modification, postponement or indulgence
is not materially adverse to the interests of the securityholders (taking into
account any estimated loss that might result absent such action).

     In any case in which property securing a loan has been, or is about to be,
conveyed by the mortgagor or obligor, the master servicer will, to the extent it
has knowledge of the conveyance or proposed conveyance, exercise or cause to be
exercised its rights to accelerate the maturity of the loan under any
due-on-sale clause applicable to it, but only if permitted by applicable law and
will not impair or threaten to impair any recovery under any primary mortgage
guaranty insurance policy. If these conditions are not met or if the master
servicer reasonably believes it is unable under applicable law to enforce such
due-on-sale clause or if the loan is a mortgage loan insured by the FHA or
partially guaranteed by the VA, the master servicer will enter into or cause to
be entered into an assumption and modification agreement with the person to whom
the property has been or is about to be conveyed, pursuant to which that person
becomes liable for repayment of the loan and, to the extent permitted by
applicable law, the mortgagor remains liable on it. Any fee collected by or on
behalf of the master servicer for entering into an assumption agreement will be
retained by or on behalf of the master servicer as additional servicing
compensation. See "Certain Legal Aspects of the Loans-Due-on-Sale Clauses." The
terms of the related loan may not be changed in connection with any such
assumption.

     With respect to any cooperative loans, 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 related
proprietary lease or occupancy agreement. See "Certain Legal Aspects of the
Loans." 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 the 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 shares securing
a cooperative loan.

     In general a "tenant-stockholder" (as defined in Code Section 216(b)(2)) of
a corporation that qualifies as a "cooperative housing corporation" within the
meaning of Code Section 216(b)(1) 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 Code Section 216(a) to the corporation under Code
Sections 163 and 164. In order for a corporation to qualify under Code Section
216(b)(1) for its taxable year in which the items are allowable as a deduction
to the corporation, the Section requires, among other things, that at least 80%
of the gross income of the corporation be derived from its tenant-stockholders
(as defined in Code Section 216(b)(2)). By virtue of this requirement, the
status of a corporation for purposes of Code Section 216(b)(1) must be
determined on a year-to-year basis. Consequently, there can be no assurance that
cooperatives relating to the cooperative loans will

                                       67


qualify under Section 216(b)(1) for any particular year. If 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 Code Section 216(a) with respect
to those years. In view of the significance of the tax benefits accorded
tenant-stockholders of a corporation that qualifies under Code Section
216(b)(1), the likelihood that a failure would be permitted to continue over a
period of years appears remote.

HAZARD INSURANCE

     The related prospectus supplement may provide otherwise, but the master
servicer generally will require the mortgagor or obligor on each loan to
maintain a hazard insurance policy providing for no less than the coverage of
the standard form of fire insurance policy with extended coverage customary for
the type of property in the state in which such property is located. The
coverage will be in an amount that is at least equal to the lesser of

     o   the maximum insurable value of the improvements securing the loan or

     o   the greater of

         (1)  the outstanding principal balance of the loan and

         (2)  an amount such that the proceeds of the policy shall be sufficient
              to prevent the mortgagor or the mortgagee from becoming a
              co-insurer.

All amounts collected by the master servicer under any hazard policy (except for
amounts to be applied to the restoration or repair of the property or released
to the mortgagor or obligor in accordance with the master servicer's normal
servicing procedures) will be deposited in the related Security Account. If the
master servicer maintains a blanket policy insuring against hazard losses on all
the loans comprising part of a trust fund, it will have satisfied its obligation
relating to the maintenance of hazard insurance. The blanket policy may contain
a deductible clause, in which case the master servicer will be required to
deposit from its own funds into the related Security Account the amounts that
would have been deposited in it but for such clause.

     In general, the standard form of fire and extended coverage policy covers
physical damage to or destruction of the improvements securing a loan by fire,
lightning, explosion, smoke, windstorm and hail, riot, strike and civil
commotion, subject to the conditions and exclusions particularized in each
policy. Although the policies relating to the loans may have been underwritten
by different insurers under different state laws in accordance with different
applicable forms and therefore may not contain identical terms and conditions,
their basic terms are dictated by respective state laws, and most policies
typically do not cover any physical damage resulting from war, revolution,
governmental actions, floods and other water-related causes, earth movement
(including earthquakes, landslides and mud flows), nuclear reactions, wet or dry
rot, vermin, rodents, insects or domestic animals, theft and, in certain cases,
vandalism and hurricanes. This list is merely indicative of certain kinds of
uninsured risks and is not all inclusive. If the property securing a loan is
located in a federally designated special flood area at the time of origination,
the master servicer will require the mortgagor or obligor to obtain and maintain
flood insurance.

     The hazard insurance policies covering properties securing the loans
typically contain a clause that in effect requires the insured at all time to
carry insurance of a specified percentage (generally 80% to 90%) of the full
replacement value of the insured property in order to recover

                                       68


the full amount of any partial loss. If the insured's coverage falls below this
specified percentage, then the insurer's liability upon partial loss will not
exceed the larger of the actual cash value (generally defined as replacement
cost at the time and place of loss, less physical depreciation) of the
improvements damaged or destroyed or the proportion of the loss that the amount
of insurance carried bears to the specified percentage of the full replacement
cost of the improvements. Because the amount of hazard insurance the master
servicer may cause to be maintained on the improvements securing the loans
declines as the principal balances owing on them decrease, and because improved
real estate generally has appreciated in value over time in the past, the effect
of this requirement upon partial loss may be that hazard insurance proceeds will
be insufficient to fully restore the damaged property. If specified in the
related prospectus supplement, a special hazard insurance policy will be
obtained to insure against certain of the uninsured risks described above. See
"Credit Enhancement."

     The master servicer 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 insurance or do not maintain
adequate coverage or any insurance proceeds are not applied to the restoration
of damaged property, any damage to the borrower's cooperative dwelling or the
cooperative's building could significantly reduce the value of the collateral
securing the cooperative loan to the extent not covered by other credit support.

     If the property securing a defaulted loan is damaged and proceeds from the
related hazard insurance policy are insufficient to restore the damaged
property, the master servicer is not required to expend its own funds to restore
the damaged property unless it determines that such restoration will increase
the proceeds to securityholders on liquidation of the loan after reimbursement
of the master servicer for its expenses and that the expenses will be
recoverable by it from related insurance proceeds or liquidation proceeds.

     If recovery on a defaulted loan under any related insurance policy is not
available for the reasons described in the preceding paragraph, or if the
defaulted loan is not covered by an insurance policy, the master servicer will
be obligated to follow or cause to be followed the normal practices and
procedures as it deems necessary or advisable to realize upon the defaulted
loan. If the proceeds of any liquidation of the property securing the defaulted
loan are less than the principal balance of the loan plus interest accrued on
the loan that is payable to securityholders, the trust fund will realize a loss
in the amount of the difference plus the aggregate of expenses incurred by the
master servicer in connection with the proceedings and which are reimbursable
under the Agreement. In the unlikely event that any such proceedings result in a
total recovery which is, after reimbursement to the master servicer of its
expenses, in excess of the principal balance of the loan plus interest accrued
on the loan that is payable to securityholders, the master servicer will be
entitled to withdraw or retain from the Security Account amounts representing
its normal servicing compensation with respect to such loan and, unless
otherwise specified in the related prospectus supplement, amounts representing
the balance of the excess, exclusive of any amount required by law to be
forwarded to the related borrower, as additional servicing compensation.

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     If the master servicer or its designee recovers insurance proceeds which,
when added to any related liquidation proceeds and after deduction of certain
expenses reimbursable to the master servicer, exceed the principal balance of
the loan plus interest accrued on the loan that is payable to securityholders,
the master servicer will be entitled to withdraw or retain from the Security
Account amounts representing its normal servicing compensation with respect to
the loan. If the master servicer has expended its own funds to restore the
damaged property and those funds have not been reimbursed under the related
hazard insurance policy, it will be entitled to withdraw from the Security
Account out of related liquidation proceeds or insurance proceeds an amount
equal to the expenses incurred by it, in which event the trust fund may realize
a loss up to the amount withdrawn by the master servicer. Because insurance
proceeds cannot exceed deficiency claims and certain expenses incurred by the
master servicer, no payment or recovery of insurance proceeds will result in a
recovery to the trust fund which exceeds the principal balance of the defaulted
loan together with accrued interest on it. See "Credit Enhancement."

     The proceeds from any liquidation of a loan will be applied in the
following order of priority:

         (1)  to reimburse the master servicer for any unreimbursed expenses
              incurred by it to restore the related property and any
              unreimbursed servicing compensation payable to the master servicer
              with respect to the loan;

         (2)  to reimburse the master servicer for any unreimbursed advances
              with respect to the loan;

         (3)  to accrued and unpaid interest (to the extent no advance has been
              made for that amount) on the loan; and

         (4)  as a recovery of principal of the loan. (8)

REALIZATION UPON DEFAULTED LOANS

     Primary mortgage guaranty insurance policies. The master servicer will
maintain or cause to be maintained, as the case may be, in effect, to the extent
specified in the related prospectus supplement, a primary mortgage guaranty
insurance policy with regard to each loan for which coverage is required.
Primary mortgage guaranty insurance policies reimburse certain losses sustained
by reason of defaults in payments by borrowers. The master servicer will not
cancel or refuse to renew any primary mortgage guaranty insurance policy in
effect at the time of the initial issuance of a series of securities that is
required to be kept in force under the applicable Agreement unless the
replacement primary mortgage guaranty insurance policy for such cancelled or
nonrenewed policy is maintained with an insurer whose claims-paying ability is
sufficient to maintain the current rating of the classes of securities of the
series that have been rated.

     FHA Insurance; VA Guaranties. Loans designated in the related prospectus
supplement as insured by the FHA will be insured by the FHA as authorized under
the United States Housing Act of 1937, as amended. In addition to the Title I
Program of the FHA, see "Certain Legal Aspects of the Loans--Title I Program,"
certain 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. Loans insured by FHA generally require a minimum down payment of
approximately 5% of the original principal amount of the loan. No FHA-insured
loans relating to a series may have an

                                       70


interest rate or original principal amount exceeding the applicable FHA limits
at the time of origination of the loan.

     Loans designated in the related prospectus supplement as guaranteed by the
VA will be partially guaranteed by the VA under the Serviceman'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 guaranty of mortgage loans of up
to 30 years' duration. However, no loan guaranteed by the VA will have an
original principal amount greater than five times the partial VA guaranty for
the loan. 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.

SERVICING AND OTHER COMPENSATION AND PAYMENT OF EXPENSES

     The principal servicing compensation to be paid to the master servicer in
respect of its master servicing activities for each series of securities will be
equal to the percentage per annum described in the related prospectus supplement
(which may vary under certain circumstances) of the outstanding principal
balance of each loan, and the compensation will be retained by it from
collections of interest on the loan in the related trust fund. As compensation
for its servicing duties, a sub-servicer or, if there is no sub-servicer, the
master servicer will be entitled to a monthly servicing fee as described in the
related prospectus supplement. In addition, the master servicer or sub-servicer
will retain all prepayment charges, assumption fees and late payment charges, to
the extent collected from borrowers, and any benefit that may accrue as a result
of the investment of funds in the applicable Security Account (unless otherwise
specified in the related prospectus supplement).

     The master servicer will, to the extent provided in the related prospectus
supplement, pay or cause to be paid certain ongoing expenses associated with
each trust fund and incurred by it in connection with its responsibilities under
the related Agreement, including, without limitation, payment of the fees and
disbursements of the trustee, any custodian appointed by the trustee, the
certificate registrar and any paying agent, and payment of expenses incurred in
enforcing the obligations of sub-servicers and sellers. The master servicer will
be entitled to reimbursement of expenses incurred in enforcing the obligations
of sub-servicers and sellers under certain limited circumstances. Certain other
expenses may be borne by the related trust fund as specified in the related
prospectus supplement.

EVIDENCE AS TO COMPLIANCE

     Each Agreement will provide that on or before a specified date in each
year, a firm of independent public accountants will furnish a statement to the
trustee to the effect that, on the basis of the examination by the firm
conducted substantially in compliance with the Uniform Single Attestation
Program for Mortgage Bankers or the Audit Program for Mortgages serviced for
FHLMC, the servicing by or on behalf of the master servicer of mortgage loans or
private asset backed securities, or under pooling and servicing agreements
substantially similar to each other (including the related Agreement) was
conducted in compliance with the agreements except for any significant
exceptions or errors in records that, in the opinion of the firm, the

                                       71


Audit Program for Mortgages serviced for FHLMC or the Uniform Single Attestation
Program for Mortgage Bankers requires it to report. In rendering its statement
such firm may rely, as to matters relating to the direct servicing of loans by
sub-servicers, upon comparable statements for examinations conducted
substantially in compliance with the Uniform Single Attestation Program for
Mortgage Bankers or the Audit Program for Mortgages serviced for FHLMC (rendered
within one year of the statement) of firms of independent public accountants
with respect to the related sub-servicer.

     Each Agreement will also provide for delivery to the trustee, on or before
a specified date in each year, 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 Agreement throughout the preceding year.

     Copies of the annual accountants' statement and the statement of an officer
of the master servicer may be obtained by securityholders of the related series
without charge upon written request to the master servicer at the address set
forth in the related prospectus supplement.

CERTAIN MATTERS REGARDING THE MASTER SERVICER AND THE DEPOSITOR

     The master servicer under each pooling and servicing agreement or master
servicing agreement, as applicable, will be named in the related prospectus
supplement. The entity serving as master servicer may be an affiliate of the
depositor and may have other business relationships with the depositor or the
depositor's affiliates.

     Each Agreement will provide that the master servicer may not resign from
its obligations and duties under the Agreement except upon a determination that
its duties under the Agreement are no longer permissible under applicable law.
The master servicer may, however, be removed from its obligations and duties as
set forth in the Agreement. No resignation will become effective until the
trustee or a successor servicer has assumed the master servicer's obligations
and duties under the Agreement.

     Each Agreement will further provide that neither the master servicer, the
depositor nor any director, officer, employee, or agent of the master servicer
or the depositor will be under any liability to the related trust fund or
securityholders for any action taken or for refraining from the taking of any
action in good faith pursuant to the Agreement, or for errors in judgment.
However, neither the master servicer, the depositor nor any director, officer,
employee, or agent of the master servicer or the depositor will be protected
against any liability which would otherwise be imposed for willful misfeasance,
bad faith or gross negligence in the performance of duties under the Agreement
or by reason of reckless disregard of obligations and duties under the
Agreement. Each Agreement will further provide that the master servicer, the
depositor and any director, officer, employee or agent of the master servicer or
the depositor will be entitled to indemnification by 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 Agreement or the securities,
other than any loss, liability or expense related to any specific loan or loans
(except any such loss, liability or expense otherwise reimbursable pursuant to
the Agreement) and any loss, liability or expense incurred for willful
misfeasance, bad faith or gross negligence in the performance of duties under
the Agreement or by reason of reckless disregard of obligations and duties under
the Agreement. In addition, each Agreement will provide that neither the master
servicer nor the depositor will be under any obligation to appear in, prosecute
or defend any legal action that is not incidental to its respective
responsibilities under the Agreement and that in its

                                       72


opinion may involve it in any expense or liability. The master servicer or the
depositor may, however, in its discretion undertake any such action that it
deems necessary or desirable with respect to the Agreement and the rights and
duties of the parties to the Agreement and the interests of the securityholders
under the Agreement. In that event, the legal expenses and costs of the action
and any liability resulting from it will be expenses, costs and liabilities of
the trust fund and the master servicer or the depositor, as the case may be,
will be entitled to be reimbursed for them out of funds otherwise distributable
to securityholders.

     Except as otherwise specified in the related prospectus supplement, any
person into which the master servicer may be merged or consolidated, or any
person resulting from any merger or consolidation to which the master servicer
is a party, or any person succeeding to the business of the master servicer,
will be the successor of the master servicer under each Agreement, provided that
the person is qualified to sell mortgage loans to, and service mortgage loans on
behalf of, FNMA or FHLMC and further provided that the merger, consolidation or
succession does not adversely affect the then current rating or ratings of the
class or classes of securities of any series that have been rated.


EVENTS OF DEFAULT; RIGHTS UPON EVENT OF DEFAULT


     Pooling and Servicing Agreement; Master Servicing Agreement. The applicable
prospectus supplement may provide for other events of default, but if it does
not, then events of default under each Agreement will consist of:

     o   any failure by the master servicer to distribute or cause to be
         distributed to securityholders of any class any required payment which
         continues unremedied for five days after the giving of written notice
         of the failure to the master servicer by the trustee or the depositor,
         or to the master servicer, the depositor and the trustee by the holders
         of securities such class evidencing not less than 25% of the total
         distributions allocated to such class ("percentage interests");

     o   any failure by the master servicer to make an advance as required under
         the agreement, unless cured as specified therein;

     o   any failure by the master servicer duly to observe or perform in any
         material respect any of its other covenants or agreements in the
         Agreement which failure materially affects the rights of
         securityholders and continues unremedied for sixty days after the
         giving of written notice of the failure to the master servicer by the
         trustee or the depositor, or to the master servicer, the depositor and
         the trustee by the holders of securities of any class evidencing not
         less than 25% of the aggregate percentage interests constituting such
         class; and

     o   certain events of insolvency, readjustment of debt, marshalling of
         assets and liabilities or similar proceeding and certain actions by or
         on behalf of the master servicer indicating its insolvency,
         reorganization or inability to pay its obligations.

     If specified in the related prospectus supplement, the Agreement will
permit the trustee to sell the Trust Fund Assets and the other assets of the
trust fund described under "Credit Enhancement" if payments on them are
insufficient to make payments required in the Agreement. The assets of the trust
fund will be sold only under the circumstances and in the manner specified in
the related prospectus supplement.

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     Unless otherwise provided in the related prospectus supplement, so long as
an event of default under an Agreement remains unremedied, the depositor or the
trustee may, and at the direction of holders of securities of any class
evidencing not less than 662/3% of the aggregate percentage interests
constituting such class and under other circumstances specified in the
Agreement, the trustee shall terminate all of the rights and obligations of the
master servicer under the Agreement relating to the trust fund and in and to the
related Trust Fund Assets, upon which the trustee will succeed to all of the
responsibilities, duties and liabilities of the master servicer under the
Agreement, including, if specified in the related prospectus supplement, the
obligation to make advances, and will be entitled to similar compensation
arrangements. If the trustee is unwilling or unable to so act, it may appoint,
or petition a court of competent jurisdiction for the appointment of, a mortgage
loan servicing institution with a net worth of a least $10,000,000 to act as
successor to the master servicer under the Agreement. Pending any appointment,
the trustee is obligated to act as master servicer. The trustee and any
successor to the master service may agree upon the servicing compensation to be
paid, which in no event may be greater than the compensation payable to the
master servicer under the Agreement.

     Unless otherwise provided in the related prospectus supplement, no
securityholder, solely by virtue of its status as a securityholder, will have
any right under any Agreement to institute any proceeding with respect to the
Agreement, unless the holder previously has given to the trustee written notice
of default and unless the holders of securities of any class evidencing not less
than 662/3% of the aggregate percentage interest constituting such class have
made a written request upon the trustee to institute a proceeding in its own
name as trustee and have offered to the trustee reasonable indemnity, and the
trustee for 60 days has neglected or refused to institute the proceeding.

     Indenture. The applicable prospectus supplement may provide for other
events of default, but if it does not, then the events of default under each
indenture will consist of:

     o   a default in the payment of any principal of or interest on any note of
         any series which continues unremedied for five days after the written
         notice of the default is given as specified in the related prospectus
         supplement;

     o   failure to perform in any material respect any other covenant of the
         depositor or the trust fund in the indenture which continues for a
         period of thirty (30) days after notice is given in accordance with the
         procedures described in the related prospectus supplement;

     o   certain events of bankruptcy, insolvency, receivership or liquidation
         of the depositor or the trust fund; or

     o   any other event of default provided with respect to notes of that
         series including but not limited to certain defaults on the part of the
         issuer, if any, of a credit enhancement instrument supporting the
         notes.

     If an event of default with respect to the notes of any series at the time
outstanding occurs and is continuing, either the trustee or the holders of a
majority of the then aggregate outstanding amount of the notes of such series
may declare the principal amount (or, if the notes of that series have an
interest rate of 0%, such portion of the principal amount as may be specified in
the terms of that series, as provided in the related prospectus supplement) of
all the notes of such series to be due and payable immediately. Such declaration
may, under certain circumstances, be

                                       74


rescinded and annulled by the holders of more than 50% of the Percentage
Interests of the notes of such series.

     If, following an event of default with respect to any series of notes, the
notes of such series have been declared to be due and payable, the trustee may,
in its discretion, notwithstanding such acceleration, elect to maintain
possession of the collateral securing the notes of such series and to continue
to apply distributions on such collateral as if there had been no declaration of
acceleration if such collateral continues to provide sufficient funds for the
payment of principal of and interest on the notes of such series as they would
have become due if there had not been such a declaration. In addition, the
trustee may not sell or otherwise liquidate the collateral securing the notes of
a series following an event of default, other than a default in the payment of
any principal or interest on any note of such series for five days or more,
unless

     o   the holders of 100% of the percentage interests of the notes of such
         series consent to the sale,

     o   the proceeds of such sale or liquidation are sufficient to pay in full
         the principal of and accrued interest, due and unpaid, on the
         outstanding notes of such series at the date of such sale or

     o   the trustee determines that such collateral would not be sufficient on
         an ongoing basis to make all payments on such notes as such payments
         would have become due if such notes had not been declared due and
         payable, and the trustee obtains the consent of the holders of 66 2/3%
         of the percentage interests of the notes of such series.

     If the trustee liquidates the collateral in connection with an event of
default involving a default for five days or more in the payment of principal of
or interest on the notes of a series, the indenture provides that the trustee
will have a prior lien on the proceeds of any such liquidation for unpaid fees
and expenses. As a result, upon the occurrence of such an event of default, the
amount available for distribution to the noteholders would be less than would
otherwise be the case. However, the trustee may not institute a proceeding for
the enforcement of its lien except in connection with a proceeding for the
enforcement of the lien of the indenture for the benefit of the noteholders
after the occurrence of such an event of default.

     Except as otherwise specified in the related prospectus supplement, if the
principal of the notes of a series is declared due and payable, as described
above, the holders of any such notes issued at a discount from par may be
entitled to receive no more than an amount equal to the unpaid principal amount
of the notes less the amount of such discount which is unamortized.

     Subject to the provisions of the indenture relating to the duties of the
trustee, in case an event of default shall occur and be continuing with respect
to a series of notes, the trustee shall be under no obligation to exercise any
of the rights or powers under the indenture at the request or direction of any
of the holders of notes of such series, unless such holders offered to the
trustee security or indemnity satisfactory to it against the costs, expenses and
liabilities which might be incurred by it in complying with such request or
direction. Subject to such provisions for indemnification and certain
limitations contained in the indenture, the holders of a majority of the then
aggregate outstanding amount of the notes of such series shall have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the trustee or exercising any trust or power conferred on the
trustee with respect to the notes of such series, and the holders of a majority
of the then aggregate outstanding amount of the notes of such series

                                       75


may, in certain cases, waive any default with respect to them, except a default
in the payment of principal or interest or a default in respect of a covenant or
provision of the indenture that cannot be modified without the waiver or consent
of all the holders of the outstanding notes of such series affected by that
default.

AMENDMENT

     The applicable prospectus supplement may specify other amendment
provisions, but if it does not, then each Agreement may be amended by the
depositor, the master servicer and the trustee, without the consent of any of
the securityholders:

     o   to cure any ambiguity or mistake;

     o   to correct any defective provision in the Agreement or to supplement
         any provision in the Agreement which may be inconsistent with any other
         provision in it;

     o   to conform the pooling and servicing agreement to the final prospectus
         supplement provided to investors in accordance with the initial
         offering of the securities;

     o   to add to the duties of the depositor, the seller or the master
         servicer;

     o   to add any other provisions with respect to matters or questions
         arising under the Agreement or

     o   to modify, alter, amend, add to or rescind any of the terms or
         provisions contained in the Agreement.

However, no action pursuant to the fifth and sixth bulleted items above may, as
evidenced by an opinion of counsel, adversely affect in any material respect the
interests of any securityholder. No opinion of counsel will be required,
however, if the person requesting the amendment obtains a letter from each
rating agency requested to rate the class or classes of securities of the series
stating that the amendment will not result in the downgrading or withdrawal of
the respective ratings then assigned to such securities.

     In addition, if a REMIC election is made with respect to a trust fund, the
related Agreement may be amended to modify, eliminate or add to any of its
provisions to such extent necessary or helpful to maintain the qualification of
the related trust fund as a REMIC, avoid or minimize the risk of the imposition
of any tax on the REMIC or to comply with any other provision of the Code, if
the trustee has received an opinion of counsel to the effect that the action is
necessary or helpful to maintain the qualification, avoid or minimize that risk
comply with any such requirement of the Code, as the case may be.

     The applicable prospectus supplement may specify other amendment
provisions, but if it does not, then each Agreement may also be amended by the
depositor, the master servicer and the trustee with the consent of holders of
securities of the series evidencing not less than 662/3% of the aggregate
percentage interests of each class adversely affected thereby for the purpose of
adding any provisions to or changing in an manner or eliminating any of the
provisions of the Agreement or of modifying in any manner the rights of the
holders of the related securities. However, that no such amendment may

     o   reduce in any manner the amount of or delay the timing of, payments
         received on loans which are required to be distributed on any security
         without the consent of the holder of the security,

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     o   amend, modify, add to, rescind or alter in any respect the provisions
         of the pooling and servicing agreement restricting the trust fund from
         engaging in any activity that would disqualify the trust fund from
         being a qualifying special purpose entity under generally accepted
         accounting principles without the consent of the holders of securities
         evidencing percentage interests aggregating 662/3% (provided however
         that no securities held by the seller, the depositor or any affiliate
         shall be given effect for the purpose of such calculation), or

     o   reduce the aforesaid percentage of securities of any class the holders
         of which are required to consent to the amendment without the consent
         of the holders of all securities of the class covered by the Agreement
         then outstanding.

If a REMIC election is made with respect to a trust fund, the trustee will not
be entitled to consent to an amendment to the related Agreement without having
first received an opinion of counsel to the effect that the amendment will not
cause the trust fund to fail to qualify as a REMIC.

TERMINATION; OPTIONAL TERMINATION

     Pooling and Servicing Agreement; Trust Agreement. Generally, the
obligations created by each pooling and servicing agreement and trust agreement
for each series of securities will terminate upon the payment to the related
securityholders of all amounts held in the Security Account or by the master
servicer and required to be paid to them pursuant to such Agreement following
the later of

     o   the final payment of or other liquidation of the last of the Trust Fund
         Assets subject to it or the disposition of all property acquired upon
         foreclosure of any such Trust Fund Assets remaining in the trust fund
         and

     o   the purchase by the master servicer or, if specified in the related
         prospectus supplement, by the holder of a call right with respect to
         the Trust Fund Assets after the passage of a specified period of time
         or after the principal balance of the Trust Fund Assets or the
         securities has been reduced to a specified level.

     Unless the related prospectus supplement provides otherwise, any such
purchase of Trust Fund Assets and property acquired in respect of Trust Fund
Assets will be made at the option of the master servicer or such other person at
a price specified in the related prospectus supplement. The exercise of that
right will effect early retirement of the securities of that series, but the
right of the master servicer or the other person to so purchase is subject to
the principal balance of the related Trust Fund Assets being less than the
percentage specified in the related prospectus supplement of the aggregate
principal balance of the Trust Fund Assets at the cut-off date for the series.
The foregoing is subject to the provision that if a REMIC election is made with
respect to a trust fund, any repurchase pursuant to the second bulleted item
above will be made only in connection with a "qualified liquidation" of the
REMIC within the meaning of Section 860F(g)(4) of the Code.

     Indenture. The indenture will be discharged with respect to a series of
notes (except with respect to certain continuing rights specified in the
indenture) upon the delivery to the trustee for cancellation of all the notes of
such series or, with certain limitations, upon deposit with the trustee of funds
sufficient for the payment in full of all of the notes of such series.

                                       77


     In addition to such discharge with certain limitations, the indenture will
provide that, if so specified with respect to the notes of any series, the
related trust fund will be discharged from any and all obligations in respect of
the notes of such series (except for certain obligations relating to temporary
notes and exchange of notes, to register the transfer of or exchange notes of
such series, to replace stolen, lost or mutilated notes of such series, to
maintain paying agencies and to hold monies for payment in trust) upon the
deposit with the trustee, in trust, of money and/or direct obligations of or
obligations guaranteed by the United States of America which through the payment
of interest and principal in respect of them in accordance with their terms will
provide money in an amount sufficient to pay the principal of and each
installment of interest on the notes of such series on the last scheduled
distribution date for such notes and any installment of interest on such notes
in accordance with the terms of the indenture and the notes of such series. In
the event of any defeasance and discharge of notes of such series, holders of
notes of such series would be able to look only to such money and/or direct
obligations for payment of principal and interest, if any, on their notes until
maturity.

THE TRUSTEE

     The trustee under each Agreement will be named in the applicable prospectus
supplement. The commercial bank or trust company serving as trustee may have
normal banking relationships with the depositor, the master servicer and any of
their respective affiliates.

                       CERTAIN LEGAL ASPECTS OF THE LOANS

     The following discussion contains general summaries of certain legal
matters relating to the loans. Because the legal aspects are governed primarily
by applicable state laws, which may differ substantially from state to state,
the summaries are not complete, nor do they reflect the laws of any particular
state or encompass the laws of all states in which the security for the loans is
situated.

GENERAL

     The loans will be secured by deeds of trust, mortgages, security deeds or
deeds to secure debt, depending on the prevailing practice in the state in which
the property subject to the loan is located. In California, deeds of trust are
used almost exclusively instead of mortgages.

     o   A mortgage creates a lien upon the real property encumbered by the
         mortgage. A mortgage lien generally does not have priority over the
         lien for real estate taxes and assessments. Priority between mortgages
         depends on their terms and generally, on the order of recording with a
         state or county office. There are two parties to a mortgage: the
         mortgagor, who is the borrower and owner of the mortgaged property, and
         the mortgagee, who is the lender. Under the mortgage instrument, the
         mortgagor delivers a note or bond and the mortgage to the mortgagee.

     o   A deed of trust is similar to a mortgage, but it has three parties: the
         borrower/property owner called the trustor (similar to a mortgagor), a
         lender (similar to a mortgagee) called the beneficiary, and a
         third-party grantee called the trustee. Under a deed of trust, the
         borrower grants the property to the trustee to secure payment of the
         obligation. The borrower grants the property irrevocably, in trust,
         until the debt is paid, generally with a power of sale.

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     o   A security deed and a deed to secure debt are special types of deeds
         which indicate on their face that they are granted to secure an
         underlying debt. By executing a security deed or deed to secure debt,
         the grantor conveys title to the grantee, as opposed to merely creating
         a lien on the property, until the underlying debt is repaid.

The trustee's authority under a deed of trust, the mortgagee's authority under a
mortgage and the grantee's authority under a security deed or deed to secure
debt are governed by law and, with respect to some deeds of trust, by the
directions of the beneficiary.

     In this prospectus, we generally use the term "mortgage" to generically
describe real-estate security instruments, however, if certain information
relates to a particular security instrument, we will refer to that security
instrument.

     Cooperatives. Certain of the loans may be cooperative loans. In the
cooperative form of ownership, the cooperative owns all the real property
comprising the project, including the land, separate dwelling units and all
common areas. The cooperative is directly responsible for project management
and, in most cases, for payment of real estate taxes and hazard and liability
insurance. If there is a blanket mortgage on the cooperative or underlying land
or both, as is generally the case, the cooperative, as project mortgagor, is
also responsible for meeting these mortgage obligations. The cooperative
ordinarily incurs a blanket mortgage in connection with the construction or
purchase of the cooperative's apartment building. The interest of an occupant
under a proprietary lease or occupancy agreement to which the cooperative is a
party is generally subordinate to the interest of the holder of the blanket
mortgage in that building. If the cooperative cannot meet its payment
obligations under the blanket mortgage, the mortgagee holding the blanket
mortgage could foreclose and terminate all subordinate proprietary leases and
occupancy agreements. In addition, the blanket mortgage on a cooperative may not
fully amortize, but instead provide for a significant portion of principal due
in one lump sum at final maturity. If the cooperative is unable to refinance
this mortgage and thus cannot make its final payment, the mortgagee could
foreclose. A foreclosure in either of those situations could eliminate or
significantly diminish the value of any collateral held by a lender that
financed the purchase of cooperative shares by an individual tenant-stockholder
or, in the case of a trust fund including cooperative loans, the value of the
collateral securing those loans.

     A cooperative is owned by tenant-stockholders. By virtue of their ownership
of stock, shares or membership certificates in the corporation, the
tenant-stockholders receive proprietary leases or occupancy agreements
conferring exclusive rights to occupy specific units. A tenant-stockholder
generally must make monthly payments to the cooperative, consisting of the
tenant-stockholder's pro rata share of the cooperative's payments on the blanket
mortgage, real property taxes, maintenance expenses and other capital or
ordinary expenses. An ownership interest in a cooperative and the rights
accompanying that ownership interest are financed by 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. To perfect its interest in the
collateral, the lender files a financing statement covering the proprietary
lease or occupancy agreement and the cooperative shares in the appropriate state
and local offices. Subject to the limitations discussed below, if a
tenant-stockholder, defaults, 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 the tenant-stockholder as an individual, as provided
in the applicable security agreement.

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FORECLOSURE AND REPOSSESSION

     Deed of Trust. A deed of trust generally is foreclosed by means of a
non-judicial sale. A provision of the deed of trust authorizes the trustee to
sell the property at public auction if the borrower defaults. In certain states,
foreclosure also may be accomplished by judicial action in the same manner as a
mortgage foreclosure. In some states, such as California, 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 any notice of default and notice
of sale. In addition, in some states, the trustee must provide notice to any
other individual having an interest of record in the property, including junior
lien holders. If the deed of trust is not reinstated within any applicable cure
period, a notice of sale must be posted in a public place and in most states,
including California, published for a specific period of time in one or more
newspapers. In addition, a copy of the notice of sale must be posted on the
property and sent to all parties having an interest of record in the property.
In California, the entire process, from recording the notice of default to
completing the non-judicial sale, usually takes four to five months.

     In some states, including California, the borrower-trustor has a right to
reinstate the loan at any time after default until shortly before the trustee's
sale. In general, the borrower or any other person with a junior encumbrance on
the real estate, may cure the default during the reinstatement period by paying
the entire amount in arrears plus the costs and expenses incurred in enforcing
the obligation. Certain state laws limit the amount of foreclosure expenses and
costs, including attorney's fees, that a lender can recover.

     Mortgages. A mortgage generally is foreclosed by means of a judicial
proceeding. The foreclosure action is initiated by serving legal pleadings on
all parties having an interest in the real property. Difficulties in locating
necessary parties can delay the proceedings. Judicial foreclosure proceedings
are frequently uncontested by any of the parties. When the mortgagee's right to
foreclosure is contested, however, legal resolution of the issues can be time
consuming. Upon completion of a judicial foreclosure proceeding, the court
generally issues a judgment of foreclosure and appoints a referee or other court
officer to conduct a sale of the property. In general, the borrower or any other
person with a junior encumbrance on the real estate, may cure the default during
a reinstatement period by paying the entire amount in arrears plus the costs and
expenses incurred in enforcing the obligation. Certain state laws limit the
amount of foreclosure expenses and costs, including attorney's fees, that a
lender can recover. If the default is not cured when the reinstatement period
expires, the borrower or junior lienholder loses the right to reinstate the loan
and must pay the loan in full to prevent a foreclosure sale. If the loan is not
reinstated within any applicable cure period, 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, a copy of the notice of sale must be posted
on the property and sent to all parties having an interest of record in the
property.

     Although foreclosure sales are typically public sales, there are often no
third party bids in excess of the lender's lien. Several factors account for the
lack of higher bids, including the difficulty of determining the exact status of
title to the property, possible deterioration of the property during the
foreclosure proceedings and a requirement that the purchaser pay for the
property in cash or by cashier's check. Thus the foreclosing lender often
purchases the property from the trustee or referee for an amount equal to the
outstanding principal amount of the loan, accrued and unpaid interest and the
expenses of foreclosure. The lender then assumes the burdens of ownership,
including obtaining hazard insurance and making repairs at its own

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expense that will 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 on market
conditions, the ultimate proceeds of the sale may not equal the lender's
investment in the property.

     Courts have applied general equitable principles to foreclosure
proceedings, which are intended to mitigate the legal consequences of default to
the borrower. Some courts have considered whether the due process provisions of
federal or state constitutions require that borrowers under deeds of trust
receive more notice than the applicable state statute provides. For the most
part, courts have upheld the statutory notice provisions as being reasonable or
have found that a trustee's sale under a deed of trust does not involve
sufficient state action to afford constitutional protection to the borrower.

     When the beneficiary under a junior mortgage or deed of trust cures the
default and reinstates or redeems by paying the full amount of the senior
mortgage or deed of trust, the amount paid by the beneficiary becomes a part of
the indebtedness secured by the junior mortgage or deed of trust. See "--Junior
Mortgages; Rights of Senior Mortgagees" below.

     Cooperative Loans. The cooperative shares owned by a tenant-stockholder and
pledged to the lender are almost always subject to restrictions on transfer
specified in the cooperative's certificate of incorporation and bylaws, as well
as in the proprietary lease or occupancy agreement, The cooperative may cancel a
tenant-stockholder's shares if the tenant-stockholder fails to pay rent or other
obligations or charges owed, including mechanics' liens against the cooperative
apartment building incurred by the tenant-stockholder. The proprietary lease or
occupancy agreement generally permits the cooperative to terminate the lease or
agreement if the obligor fails to make payments, or defaults in the performance
of covenants required under the lease or agreement. Typically, the lender and
the cooperative enter into a recognition agreement establishing the rights and
obligations of both parties if the tenant-stockholder defaults 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 if the tenant-stockholder
defaults under the proprietary lease or occupancy agreement, the cooperative
will not seek to terminate the lease or agreement until the lender has had 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 the sale of
the cooperative apartment, subject to the cooperative's right to any amount due
under the proprietary lease or occupancy agreement. The amount that the
tenant-stockholder owes the cooperative could reduce the value of the collateral
below the outstanding principal balance of the cooperative loan and accrued and
unpaid interest on the loan. The lender generally cannot restrict and does not
monitor how much the tenant-stockholder owes the cooperative.

     Recognition agreements also provide that upon foreclosure of 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. Generally, any right of the lender to
dispossess the tenant-stockholder is not limited.

     In some states, foreclosure on cooperative shares is accomplished by a sale
in accordance with Article 9 of the Uniform Commercial Code (the "UCC") and the
security agreement relating

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to those shares. Article 9 of the UCC requires that a sale be conducted in a
"commercially reasonable" manner. Whether a foreclosure sale has been conducted
in a "commercially reasonable" manner depends on the facts of 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 foreclosure.
Generally, a sale will be considered commercially reasonable if it was conducted
according to the usual practice of banks selling similar collateral.

     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 cooperative's right to receive amounts due under the
proprietary lease or occupancy agreement. If any proceeds remain, 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.

     If the foreclosure involves a building that was converted from a rental
building to a building owned by a cooperative under a non-eviction plan, some
state laws provide that a purchaser at a foreclosure sale takes the property
subject to any rent control and rent stabilization laws applying to certain
tenants who remained in the building when it was converted to cooperative
ownership, but did not buy shares in the cooperative.

ENVIRONMENTAL RISKS

     Real property pledged to a lender may be subject to unforeseen
environmental risks. Under certain state laws, contamination of a property may
give rise to a lien on the property to assure the payment of clean-up costs. In
several states, that lien has priority over an existing mortgage. In addition,
under the federal Comprehensive Environmental Response, Compensation and
Liability Act of 1980 ("CERCLA"), the EPA may impose a lien on property with
respect to which it has incurred clean-up costs. A CERCLA lien, however, is
subordinate to pre-existing, perfected security interests.

     CERCLA imposes liability for the costs of addressing releases or threatened
releases of hazardous substances at a property on any and all "responsible
parties," including owners or operators. Under CERCLA and certain state laws, a
secured lender may be liable as an "owner" or "operator," even if the
environmental damage or threat was caused by a prior or current owner or
operator. CERCLA excludes from the definition of "owner or operator" a secured
creditor that holds indicia of ownership primarily to protect its security
interest without "participating in the management" of the property. If a
lender's activities encroach on the actual management of a contaminated facility
or property, however, that lender may be considered an "owner or operator" under
CERCLA. Similarly, if a lender forecloses and takes title to a contaminated
facility or property, the lender may incur CERCLA liability in various
circumstances, including when it holds the facility or property as an investment
(including leasing the facility or property to a third party), or fails to
market the property in a timely fashion.

     Whether actions taken by a lender would constitute participation in the
management of a mortgaged property, or the business of a borrower, so as to
render the secured creditor exemption unavailable to a lender, was historically
a matter of judicial interpretation of the statutory language. Judicial
interpretations of the CERCLA secured creditor exclusion have been

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inconsistent. In United States v. Fleet Factors Corp (1990), the United States
Court of Appeals for the Eleventh Circuit suggested that the mere capacity of a
lender to influence a borrower's decisions regarding disposal of hazardous
substances was sufficient participation in the management of the borrower's
business to deny the protection of the secured creditor exclusion to the lender,
regardless of whether the lender actually exercised any influence. Other courts,
however, did not follow the narrow interpretation of the secured creditor
exclusion adopted by the Eleventh Circuit.

     Congress attempted to resolve the meaning of the secured creditor exclusion
by enacting the Asset Conservation, Lender Liability and Deposit Insurance
Protection Act of 1996 (the "Asset Conservation Act"). The Asset Conservation
Act provides that a lender actually must participate in the operational affairs
of the property or the borrower to be deemed to have participated in the
management of a secured property. Under the Asset Conservation Act,
participation in the management of the property does not include "merely having
the capacity to influence, or unexercised right to control" operations. Rather,
a lender loses the protection of the secured creditor exclusion only if it
exercises decision-making control over the borrower's environmental compliance
and hazardous substance handling and disposal practices, or assumes day-to-day
management of all operational functions of the secured property.

     If a lender is or becomes liable, it can bring an action for contribution
against any other "responsible parties," including a previous owner or operator,
that created the environmental hazard, but those other persons or entities may
be bankrupt or otherwise judgment proof. The costs associated with environmental
cleanup can be substantial. Costs arising from those circumstances could result
in a loss to Securityholders.

     CERCLA does not apply to petroleum products, and the secured creditor
exclusion does not govern liability for cleanup costs under federal laws other
than CERCLA, in particular Subtitle I of the federal Resource Conservation and
Recovery Act ("RCRA"), which regulates underground petroleum storage tanks
(except heating oil tanks). The EPA has adopted a lender liability rule for
underground storage tanks under Subtitle I of RCRA. Under that rule, the holder
of a security interest in an underground storage tank or in real property
containing 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, under the Asset Conservation Act, the
protections accorded to lenders under CERCLA are also accorded to the holders of
security interests in underground storage tanks. 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 secured creditors.

     Unless the applicable prospectus supplement provides otherwise, no
environmental assessment (or a very limited environmental assessment) of the
properties was conducted when the loans were originated.

RIGHTS OF REDEMPTION

     In some states, after a mortgage foreclosure or a sale under a deed of
trust, the borrower and certain foreclosed junior lienors have a
statutorily-prescribed period in which to redeem the property from the
foreclosure sale. In certain other states, including California, the right of
redemption applies only to sales following judicial foreclosure, and not to
sales pursuant to a non-judicial power of sale. In most states where the right
of redemption is available, the property

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can be redeemed upon payment of the foreclosure purchase price, accrued interest
and taxes. In some states, the right to redeem is an equitable right. The right
of redemption diminishes the lender's ability to sell the foreclosed property.
The exercise of a right of redemption would defeat the title of any purchaser at
a foreclosure sale, or of any purchaser from the lender after a sale under a
deed of trust or a judicial foreclosure. Consequently, the practical effect of
the redemption right 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 state laws limit the remedies of a beneficiary under a deed of
trust or of a mortgagee under a mortgage. Some states, including California,
limit the beneficiary's or mortgagee's right to obtain a deficiency judgment
against the borrower following a foreclosure or a sale under a deed of trust. A
deficiency judgment is a personal judgment against the borrower equal in most
cases to the difference between the amount due the lender and the fair market
value of the property at the time of the foreclosure sale. In certain states,
including California, if a lender simultaneously originates a loan secured by a
senior lien and a loan secured by a junior lien on the same property, the
lender, as holder of the junior lien, may be precluded from obtaining a
deficiency judgment with respect to the excess of the aggregate amount owed
under both loans over the proceeds of any sale of the property. As a result of
these prohibitions, it is anticipated that in most cases the master servicer
will use a non-judicial foreclosure remedy and will not seek deficiency
judgments against defaulting borrowers.

     Some state statutes require the beneficiary or mortgagee to exhaust the
security afforded under a deed of trust or mortgage by foreclosure, and in that
way try to satisfy the full debt before bringing a personal action against the
borrower. In other states, the lender has the option of bringing a personal
action against the borrower without first exhausting the security. However, in
some of those states, the lender may be considered to have elected a remedy
following judgment on a personal action, and therefore may be precluded from
exercising other remedies with respect to the security. In those circumstances,
lenders will usually proceed against the security before bringing a personal
action against the borrower.

     Some states provide exceptions to the anti-deficiency statutes in cases
where the borrower's acts or omissions, such as waste of the property, have
impaired the value of the lender's security. Finally, some state statutes limit
the amount of any deficiency judgment to the excess of the outstanding debt over
the fair market value of the property at the time of the public sale. These
statutes prevent the beneficiary or mortgagee from obtaining a large deficiency
judgment as a result of low bides (or no bids) at the foreclosure sale.

     Article 9 of the UCC usually governs foreclosure on cooperative shares and
the related proprietary lease or occupancy agreement. Some courts have
interpreted section 9-504 of the UCC to prohibit a deficiency award unless the
creditor proves that the sale of the collateral (in this case, the cooperative
shares and the related proprietary lease or occupancy agreement) was conducted
in a commercially reasonable manner.

     In addition to anti-deficiency and related legislation, other federal and
state statutes, including the federal bankruptcy laws, the federal
Servicemembers Civil Relief Act and state laws affording relief to debtors, may
affect the ability of the secured mortgage lender to realize

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upon its security. For example, in a proceeding under the federal Bankruptcy
Code, a lender may not foreclose on a mortgaged property without the permission
of the bankruptcy court. And in certain instances a bankruptcy court may allow a
borrower to reduce the monthly payments, change the rate of interest, and alter
the mortgage loan repayment schedule for under-collateralized mortgage loans.
The effect of these types of proceedings can be to cause delays in receiving
payments on the loans underlying securities and even to reduce the aggregate
amount of payments on the loans underlying securities.

     Under the federal tax laws, certain tax liens have priority over the lien
of a mortgage or a secured party. Several federal and state consumer protection
laws impose substantive requirements upon mortgage lenders in connection with
the origination, servicing and enforcement of mortgage loans. These 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 laws impose specific statutory
liabilities on lenders who fail to comply with their provisions. In some cases,
the liability may extend to assignees of the loans or contracts.

DUE-ON-SALE CLAUSES

     Each conventional loan usually will contain a due-on-sale clause providing
that if the mortgagor or obligor sells, transfers or conveys the property, the
mortgagee or secured party may accelerate the loan or contract. In recent years,
courts and legislatures in many states restricted lenders' rights to enforce
those clauses. For example, in 1978, the California Supreme Court held that
due-on-sale clauses were generally unenforceable. However, the Garn-St Germain
Depository Institutions Act of 1982 (the "Garn-St Germain Act"), subject to
specified exceptions, preempts state constitutional, statutory and case law
prohibiting the enforcement of due-on-sale clauses. As a result, due-on-sale
clauses are generally enforceable except in those states whose legislatures
elected to regulate the enforceability of due-on-sale clauses with respect to
mortgage loans that were:

     o   originated or assumed during the "window period" under the Garn-St
         Germain Act (which ended no later than October 15, 1982), and

     o   originated by lenders other than national banks, federal savings
         institutions and federal credit unions.

     FHLMC has taken the position in its published mortgage servicing standards
that, out of a total of eleven "window period states," five states (Arizona,
Michigan, Minnesota, New Mexico and Utah) have enacted statutes extending the
prohibition on enforcement of due-on-sale clauses with respect to certain
categories of window period loans.

     The Garn-St Germain Act "encourages" lenders to permit assumption of loans
at the original interest rate or at another rate which is less than the average
of the original rate and the market rate. As to loans secured by an
owner-occupied residence, the Garn-St Germain Act specifies nine situations in
which a mortgagee may not enforce a due-on-sale clause even if the property has
been transferred. The inability to enforce a due-on-sale clause may result in
the property being transferred to an uncreditworthy person. This, in turn, could
increase the likelihood of default or could result in a new home buyer's
assuming a mortgage with an interest rate below the current market rate. Either
of those events could affect the average life of the loans and the number of
loans remaining outstanding to maturity.

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     In addition, under federal bankruptcy law, due-on-sale clauses may not be
enforceable in bankruptcy proceedings and may, under certain circumstances, be
eliminated from any modified mortgage resulting from the bankruptcy proceeding.

PREPAYMENT CHARGES AND LATE PAYMENT FEES

     Notes, mortgages and deeds of trust may impose late charges on borrowers if
payments are not timely made, and in some cases may impose prepayment fees or
penalties if the loan is paid before maturity. Certain states may limit the
amount of late charges or prepayment charges. Under certain state laws,
prepayment charges may not be imposed after a certain period of time following
the origination of mortgage loans for owner-occupied residential properties.
Because many of the properties will be owner-occupied, it is anticipated that
prepayment charges will not be imposed on many of the loans. The lack of
prepayment charges with respect to fixed rate loans with high Loan Rates may
increase the likelihood of refinancing or other early retirement of those loans
or contracts. Late charges and prepayment fees are typically retained by
servicers as additional servicing compensation.

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. The Office of Thrift
Supervision, as successor to the Federal Home Loan Bank Board, is authorized to
issue rules and regulations and to publish interpretations governing
implementation of Title V. The statute authorized the states to reimpose
interest rate limits by adopting, before April 1, 1983, a law or constitutional
provision expressly rejecting application of the federal law. In addition, even
if a state does not reject Title V, it may adopt a provision limiting discount
points or other charges on mortgage loans covered by Title V. Certain states
have reimposed interest rate limits or limited discount points or other charges,
or both.

HOME IMPROVEMENT CONTRACTS

     General. Some home improvement contracts may, in addition to being secured
by mortgages on real estate, also be secured by purchase money security
interests in the home improvements financed by those contracts. These home
improvement contracts are referred to in this section as "contracts"). The
contracts generally are "chattel paper" or "purchase money security interests,"
each as defined in the UCC. Under the UCC, the sale of chattel paper is treated
similarly to perfection of a security interest in chattel paper. Under the
related agreement, the depositor will transfer physical possession of the
contracts to the trustee or a designated custodian, or may retain possession of
the contracts as custodian for the trustee. In addition, the depositor will file
a UCC-1 financing statement in the appropriate states to give notice of the
trust fund's ownership of the contracts and for other reasons. In general, the
contracts will not be stamped or otherwise marked to reflect their assignment
from the depositor to the trustee. Therefore, if through negligence, fraud or
otherwise, a subsequent purchaser were to take physical possession of the
contracts without notice of the assignment, the trust fund's interest in the
contracts could be defeated.

     Security Interests in Home Improvements. The contracts that are secured by
the home improvements financed thereby grant to the originator of the contract a
purchase money security

                                       86


interest in the home improvements that secures all or part of the purchase price
of those improvements and related services. A financing statement generally is
not required to be filed to perfect a purchase money security interest in
consumer goods. These purchase money security interests are assignable. In
general, a purchase money security interest has priority over a conflicting
security interest in the same collateral and the proceeds of that collateral.
However, to the extent that the collateral becomes a fixture, a security
interest in those home improvement generally must be perfected by a timely
fixture filing in order for the related purchase money security interest to take
priority over a conflicting interest in the fixture. Under the UCC, a security
interest generally does not exist in ordinary building materials that are
incorporated into an improvement on land. Home improvement contracts that
finance lumber, bricks, other types of ordinary building material or other goods
that are deemed to lose their characterization as goods upon incorporation into
the related property, will not be secured by a purchase money security interest
in the home improvement being financed.

     Enforcement of Security Interest in Home Improvements. As long as the home
improvement has not become subject to real estate laws, a creditor can repossess
a home improvement either by voluntary surrender, by "self-help" repossession
that is "peaceful" (that is, without breach of the peace) or, in the absence of
either voluntary surrender or peaceful repossession, by judicial process. The
holder of a contract must give the debtor notice, ranging from 10 to 30 days
depending on the state, before commencing any repossession. The UCC and consumer
protection laws in most states place restrictions on repossession sales,
including prior notice to the debtor and commercial reasonableness in conducting
the sale. Most states also requires that the debtor be given notice, prior to
any resale of the unit, that the debtor may redeem at or before the resale.

     In most states, a creditor is entitled to a deficiency judgment against the
debtor upon repossession and resale of the property. However, some states
prohibit or limit deficiency judgments, and in many cases, the defaulting
borrower would have no assets with which to pay the judgment.

     Certain other statutes, including federal and state bankruptcy laws, as
well as general equitable principles, may limit or delay the a lender's ability
to repossess and resell collateral or enforce a deficiency judgment.

     Consumer Protection Laws. The so-called holder-in-due course rules of the
Federal Trade Commission protect the homeowner from defective craftsmanship or
incomplete work by a contractor. These rules permit the obligor to withhold
payment if the work does not meet the quality and durability standards agreed to
by the homeowner and the contractor. The holder in due course rules have the
effect of subjecting any assignee of the seller in a consumer credit transaction
to all claims and defenses which the obligor in the credit sale transaction
could assert against the seller of the goods. Liability is limited to amounts
paid under the contract; however, the obligor also may be able to set off
remaining amounts due as a defense against a claim by the Trustee against the
obligor. Several federal and state consumer protection laws impose substantive
requirements in connection with the origination, servicing and enforcement of
the contracts. These laws include the federal Truth-in Lending Act, Federal
Trade Commission Act, Fair Credit Billing Act, Fair Credit Reporting Act, Equal
Credit Opportunity Act, Fair Debt Collection Practices Act and the Uniform
Consumer Credit Code. In some cases, failure to comply with these laws could
affect the enforceability of the related contract.


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INSTALLMENT CONTRACTS

     The loans may also include installment contracts. Under an installment
contract, the seller (referred to in this section as the "lender") retains legal
title to the property and enters into an agreement with the purchaser (referred
to in this section as the "borrower") for the payment of the purchase price,
plus interest, over the term of the contract. The lender obligated to convey
title to the borrower only after the borrower has fully performed under the
contract. As with mortgage or deed of trust financing, during the effective
period of the installment contract, the borrower is generally responsible for
maintaining the property in good condition and for paying real estate taxes,
assessments and hazard insurance premiums associated with the property.

     State law determines the process by which a lender enforces its rights
under an installment contract. Installment contracts generally provide that if
the borrower defaults, the borrower loses his or her right to occupy the
property, the entire indebtedness is accelerated, and the borrower's equitable
interest in the property is forfeited. The lender does not have to foreclose in
order to obtain title to the property, although a quiet title action may be
necessary if the borrower has filed the installment contract in local land
records, and an ejectment action may be necessary to recover possession. A few
states permit ejectment of the borrower and forfeiture of his or her interest in
the property, particularly during the early years of an installment contract.
However, most states have enacted legislation protecting borrowers under
installment contracts from the harsh consequences of forfeiture. Under these
statutes, judicial or nonjudicial foreclosure may be required, the lender may be
required to give notice of default and the borrower may be granted some grace
period during which the installment contract may be reinstated upon full payment
of amounts due. In addition, the borrower may have a post-foreclosure right of
redemption. In other states, courts may permit a borrower with a significant
investment under an installment contract for the sale of real estate to share in
the sale proceeds after the indebtedness is repaid, or may otherwise refuse to
enforce the forfeiture clause. In general, however, the method by which a lender
obtains possession and clear title under an installment contract is simpler,
faster and cheaper than is the process of foreclosing and obtaining clear title
to a property subject to one or more liens.

SERVICEMEMBERS CIVIL RELIEF ACT

     Under the Servicemembers Civil Relief Act (the "Relief Act"), a borrower
who enters military service after the origination of that borrower's loan
(including a borrower who is a member of the National Guard or is in reserve
status at the time of origination and is later called to active duty) generally
may not be charged interest above an annual rate of 6% during the period of
active duty status, unless a court orders otherwise upon the lender's
application. It is possible that this restriction could affect the master
servicer's ability to collect full amounts of interest on some of the loans for
an indeterminate time. Unless the applicable prospectus supplement provides a
special feature for a particular trust fund, any shortfall in interest
collections resulting from the Relief Act could result in losses to
securityholders. The Relief Act also limits the master servicer's ability to
foreclose on an affected loan during the borrower's period of active duty
status. If one of these loans goes into default, the inability to realize upon
the property in a timely fashion could lead to delays and losses.


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JUNIOR MORTGAGES AND RIGHTS OF SENIOR MORTGAGEES

     If any loans are secured by mortgages that are junior to mortgages held by
other lenders or institutional investors, the rights of the related trust fund
(and therefore the related securityholders), as mortgagee under that junior
mortgage, are subordinate to those of any mortgagee under a senior mortgage. The
senior mortgagee has the right to receive hazard insurance and condemnation
proceeds and to sell the property upon default of the mortgagor. This would
extinguish the junior mortgagee's lien unless the junior mortgagee asserts its
subordinate interest in the property in foreclosure litigation and, possibly,
satisfies the defaulted senior mortgage. A junior mortgagee may satisfy a
defaulted senior loan in full and in some states, may cure a default and bring
the senior loan current, in either case adding the amounts spent to the balance
due on the junior loan. In most states, notice of default is not required to be
given to a junior mortgagee, unless the mortgage or deed of trust requires it.


OTHER LOAN PROVISIONS AND LENDER REQUIREMENTS


     The standard mortgage form that most institutional lenders use gives the
mortgagee the right to receive all proceeds collected under any hazard insurance
policy and all awards under any condemnation proceedings. The mortgagee may
apply these proceeds and awards to any indebtedness secured by the mortgage, in
whatever order the mortgagee determines. Thus, if improvements on the property
are damaged or destroyed by fire or other casualty, or if the property is taken
by condemnation, the mortgagee or beneficiary under a senior mortgage will have
the prior right to any insurance proceeds and any condemnation award. In most
cases, any proceeds in excess of the senior mortgage debt may be applied to
satisfy a junior mortgage.

     In some cases, the mortgage or deed of trust used by institutional lenders
requires that the mortgagor:

     o   pay all taxes and assessments on the property before they become
         delinquent,

     o   pay all encumbrances, charges and liens on the property that have
         priority to the mortgage or deed of trust,

     o   provide and maintain fire insurance on the property,

     o   maintain and repair the property and not commit or permit any waste of
         the property, and

     o   appear in and defend any action or proceeding that may affect the
         property or the rights of the mortgagee under the mortgage.

Under certain mortgages, if the mortgagor fails to perform any of these
obligations, the mortgagee has the option of performing the obligation itself
and being reimbursed by the mortgagor. Any amounts that the mortgagee spends for
these purposes become part of the indebtedness secured by the mortgage.

PRIORITY OF ADDITIONAL ADVANCES

     Most institutional lenders that make revolving credit line loans use a form
of credit line trust deed or mortgage containing a "future advance" clause. A
future advance clause provides that any additional amounts that the beneficiary
or lender advances to or on behalf of the borrower also will be secured by the
deed of trust or mortgage. Any future advances made after the cut-off date with
respect to any loan will not be included in the related trust fund. In most
states, the

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priority of the lien securing a future advance depends on whether the deed of
trust or mortgage is called and recorded as a credit line deed of trust or
mortgage. If the beneficiary or lender advances additional amounts, that advance
is entitled to the same priority as amounts initially advanced under the trust
deed or mortgage. That is true even if any junior trust deeds or mortgages or
other liens intervene between the date of recording of the senior trust deed or
mortgage and the date of the future advance, and even if the beneficiary or
lender had actual knowledge of the intervening junior trust deed or mortgage or
other liens at the time of the future advance. In most states, the trust deed or
mortgage lien securing home equity credit lines applies retroactively to the
date of the original recording of the trust deed or mortgage, as long as the
amount advanced under the home equity credit line does not exceed the maximum
specified principal amount of the recorded trust deed or mortgage (except as to
advances made after the lender receives written notice of lien from a judgment
lien creditor of the trustor.)

THE TITLE I PROGRAM

     General. Some of the loans included in any trust fund may be insured under
the FHA Title I Credit Insurance program created pursuant to Sections 1 and 2(a)
of the National Housing Act of 1934 (the "Title I Program"). Under the Title I
Program, the FHA is authorized and empowered to insure qualified lending
institutions against losses on eligible loans. The Title I Program operates as a
coinsurance program in which the FHA insures up to 90% of certain losses
incurred on an individual insured loan, including the unpaid principal balance
of the loan, but only to the extent of the insurance coverage available in the
lender's FHA insurance coverage reserve account. The owner of the loan bears the
uninsured loss on each loan.

     Loans eligible for FHA insurance under the Title I Program include property
improvement loans ("Property Improvement Loans" or "Title I Loans"). A Property
Improvement Loan or Title I Loan is a loan to finance actions or items that
substantially protect or improve the basic livability or utility of a property.
Single family improvement loans are included in this category.

     A Title I Loan is originated using one of the following methods:

     o   Direct Loan. Under this method, the borrower applies directly to a
         lender without any assistance from a dealer. The application may be
         filled out by the borrower or by a person acting at the borrower's
         direction who does not have a financial interest in the loan
         transaction. The lender may disburse the loan proceeds to the borrower
         or to the borrower and other parties to the transaction.

     o   Dealer Loan. Under this method, a dealer, who has a direct or indirect
         financial interest in the loan transaction, assists the borrower in
         preparing the loan application or otherwise assists the borrower in
         obtaining the loan. The lender may disburse the loan proceeds to the
         dealer or the borrower, or jointly to the borrower and the dealer or
         other parties. A dealer may include a seller, a contractor, or a
         supplier of goods or services.

     Loans insured under the Title I Program must have fixed interest rates. The
lender can establish the interest rate, which must be recited in the note. The
loans generally must provide for equal installment payments due weekly,
biweekly, semi-monthly or monthly, except that a loan may be payable quarterly
or semi-annually in order to correspond with a borrower's irregular flow of
income. The first or last payments (or both) may vary in amount but may not
exceed 150% of the regular installment payment. The first scheduled payment must
be due no later than two months from the date of the loan. The note must permit
full or partial prepayment of the

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loan. Interest must accrue from the date of the loan and be calculated on a
simple interest basis. The lender must assure that the note and all other loan
documents comply with applicable federal, state and local laws.

     Each Title I lender is required to use prudent lending standards in
underwriting individual loans and to satisfy the applicable Title I underwriting
requirements before approving a loan and disbursing the loan proceeds.
Generally, the lender must exercise prudence and diligence in determining
whether the borrower (and any co-maker) is solvent, is an acceptable credit
risk, and is reasonably able to make the loan payments. The lender must
determine whether the borrower's income will be adequate to cover the loan
payments as well as the borrower's other housing and recurring expenses. The
lender makes this determination in accordance with the expense-to-income ratios
published by the Secretary of HUD.

     Under the Title I Program, the FHA does not review the individual loans
insured under the program, or approve them for qualification at the time of
approval by the lending institution. (This is different from the procedure under
other federal loan programs.) After a Title I Loan has been made and reported
for insurance, if a lender discovers any material misstatement of fact or
discovers that a borrower, dealer or any other party has misused loan proceeds,
it shall promptly report this to the FHA. However, if the validity of any lien
on the property has not been impaired, the Title I insurance will not be
affected unless the material misstatement of fact or misuse of loan proceeds was
caused by (or was knowingly sanctioned by) the lender or its employees.

     Requirements for Title I Loans. The maximum principal amount of a Title I
Loan must not exceed the actual cost of the project plus any applicable fees and
charges allowed under the Title I Program; provided that the maximum amount does
not exceed $25,000 (or the current applicable amount) for a single family
property improvement loan. The term of a Title I Loan generally may not be less
than six months nor greater than 20 years and 32 days. A borrower may obtain
multiple Title I Loans with respect to multiple properties, or more than one
Title I Loan with respect to a single property, in each case as long as the
total outstanding balance of all Title I Loans for the same property does not
exceed the maximum loan amount for the type of Title I Loan on that property
having the highest permissible loan amount.

     To be eligible for a Title I Loan, the borrower must have:

     o   at least a one-half interest in fee simple title to the real property,
         or

     o   a lease of the property for a term expiring at least six months after
         the final maturity of the Title I Loan, or

     o   a recorded land installment contract for the purchase of the real
         property.

In the case of a Title I Loan over $15,000, the borrower also must have equity
in the property being improved at least equal to the amount of the loan. Any
Title I Loan over $7,500 must be secured by a recorded lien on the improved
property, evidenced by a mortgage or deed of trust executed by the borrower and
all other owners in fee simple.

     Title I Loan proceeds may be used only to finance property improvements
that substantially protect or improve the basic livability or utility of the
property as disclosed in the loan application. The Secretary of HUD has
published a list of items and activities, which it can amend from time to time,
that cannot be financed with Title I Loan proceeds. Before a lender

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may disburse funds under a dealer Title I Loan, the lender must have in its
possession a completion certificate on a HUD-approved form, signed by the
borrower and the dealer. In the case of a direct Title I Loan, the borrower must
sign and submit a completion certificate to the lender promptly upon completion
of the improvements but not later than six months after disbursement of the loan
proceeds (one six month extension is allowed if necessary). The lender or its
agent is required to conduct an on-site inspection with respect to any Title I
Loan of $7,500 or more, and any direct Title I Loan where the borrower fails to
submit a completion certificate.

     FHA Insurance Coverage. Under the Title I Program the FHA establishes an
insurance coverage reserve account for each lender that has been granted a Title
I insurance contract. The amount of insurance coverage in each account is 10% of
the amount disbursed, advanced or expended by the lender in originating or
purchasing eligible Title I Loans, with certain adjustments. The amount in the
insurance coverage reserve account is the maximum amount of insurance claims
that FHA is required to pay. The FHA will register all loans to be insured under
the Title I Program. After the FHA receives and acknowledges a loan report on
the prescribed form, it will add the insurance coverage attributable to that
loan to the insurance coverage reserve account for the applicable originating or
purchasing lender The FHA charges a fee of 0.50% per annum of the net proceeds
(the original balance) of any eligible loan that it receives and acknowledges.
The FHA bills the lender annually for the insurance premium on each insured loan
on the approximate anniversary date of origination. If an insured loan is
prepaid during the year, FHA will not refund the insurance premium, but will
abate any insurance charges due after the prepayment.

     The FHA will reduce the insurance coverage available in a lender's FHA
insurance coverage reserve account by:

     o   the amount of FHA insurance claims relating to the insured loans that
         are approved for payment, and

     o   the amount of insurance coverage attributable to insured loans that the
         lender sells.

A lender's FHA insurance coverage reserve account will be further adjusted, as
required under Title I or by the FHA. The insurance coverage in the account also
may be earmarked with respect to each or any eligible loan, if the Secretary of
HUD determines that it is in its interest to do so. As a lender originates and
acquires new eligible loans, its insurance coverage reserve account balance will
continue to increase by 10% of the amount disbursed, advanced or expended in
originating or acquiring the eligible loans. If the Secretary of HUD determines
that it is in its interest to do so, it may transfer insurance coverage between
insurance coverage reserve accounts and earmark coverage with respect to a
particular loan or group of loans.

     The lender may transfer (except as collateral in a bona fide loan
transaction) insured loans and loans reported for insurance only to another
qualified lender under a valid Title I insurance contract. The lender may not,
however, transfer these loans as collateral in a bona fide loan transaction.
Unless an insured loan is transferred with recourse or with a guaranty or
repurchase agreement, when the FHA receives written notice of the loan transfer,
it will transfer an amount (if available) equal to the lesser of (i) 10% of the
actual purchase price or (ii) the net unpaid principal balance of the loan from
the transferor's insurance coverage reserve account to the transferee's
insurance coverage reserve account. However, no more than $5,000 in insurance
coverage can be transferred to or from a lender's insurance coverage reserve
account during any October 1 to September 30 period without the prior approval
of the Secretary of HUD.

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     Claims Procedures Under Title I. Under the Title I Program a lender may
accelerate an insured loan after a default, but only after the lender or its
agent has contacted the borrower in a face-to-face meeting or by telephone to
discuss the reasons for the default and to seek its cure. If the borrower does
not cure the default or agree to a modification agreement or repayment plan, the
lender will notify the borrower in writing that:

     o   unless the default is cured within 30 days or the borrower enters into
         a modification agreement or repayment plan, the loan will be
         accelerated, and

     o   if the default persists, the lender will report the default to an
         appropriate credit agency.

If the borrower brings the loan current, executes a modification agreement or
agrees to an acceptable repayment plan, the lender may rescind the acceleration
of maturity and reinstate the loan even after full payment is due.

     Following acceleration of maturity on a secured Title I Loan, the lender
may either proceed against the property under the security instrument or make a
claim under the lender's insurance contract. If the lender chooses to proceed
against the property under a security instrument (or if it accepts a voluntary
conveyance or surrender of the property), the lender may file an insurance claim
only with the prior approval of the Secretary of HUD.

     When a lender files an insurance claim with the FHA, the FHA reviews the
claim, the complete loan file (including any evidence of the lender's efforts to
obtain recourse against any dealer), compliance with applicable state and local
laws in carrying out any foreclosure or repossession, and determines whether the
lender has properly filed proofs of claim if the borrower is bankrupt or
deceased. Generally, a claim on any Title I Loan must be filed with the FHA no
later than nine months after the date of default of that loan. When a lender
files an insurance claim, it also assigns to the United States its entire
interest in the loan note (or judgment in lieu of the note), in any security
held and in any claim filed in any legal proceedings. If the Secretary has
reason to believe that the note is not valid or enforceable against the borrower
when the lender assigns it to the United States, the FHA may deny the claim and
reassign the note to the lender. If the FHA discovers that the note is not valid
or enforceable after it has paid a claim, it may require the lender to
repurchase the paid claim and accept a reassignment of the note. If the lender
later obtains a valid and enforceable judgment against the borrower, the lender
may submit a new claim with an assignment of the judgment. The FHA may contest a
claim and demand repurchase of a loan any time up to two years from the date the
claim was certified for payment. In the case of fraud or misrepresentation by
the lender, the FHA may contest a claim and demand repurchase of a loan even
after that period.

     Payment on an FHA insurance claim is made in an amount equal to the
"claimable amount," which cannot exceed the amount of coverage in the lender's
insurance coverage reserve account. The "claimable amount" is 90% of the sum of:

     o   the unpaid loan obligation (that is, the net unpaid principal and
         uncollected interest earned to the date of default), with adjustments
         to that amount if the lender has proceeded against property securing
         the loan,

     o   interest on the unpaid amount of the loan from the date of default to
         the date of the claim's initial submission for payment plus 15 calendar
         days (but not more than nine months from the date of default),
         calculated at an annual rate of 7.0%,

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     o   uncollected court costs,

     o   attorney's fees up to $500, and

     o   the cost of recording the assignment of the security to the United
         States.

CONSUMER PROTECTION LAWS

     Federal, state and local laws extensively regulated various aspects of
brokering, originating, servicing and collecting loans secured by consumers'
dwellings. Among other things, these laws may regulate interest rates and other
charges, require disclosures, impose financial privacy requirements, mandate
specific business practices, and prohibit unfair and deceptive trade practices.
In addition, licensing requirements may be imposed on persons that broker,
originate, service or collect such loans.

     Additional requirements may be imposed under federal, state or local laws
on so-called "high cost mortgage loans," which typically are defined as loans
secured by a consumer's dwelling that have interest rates or origination costs
in excess of prescribed levels. These laws may limit certain loan terms, such as
prepayment penalties, or the ability of a creditor to refinance a loan unless it
is in the borrower's interest. In addition, certain of these laws may allow
claims against loan brokers or originators, including claims based on fraud or
misrepresentations, to be asserted against persons acquiring the loans, such as
the trust fund.

     The federal laws that may apply to loans held in the trust fund include the
following:

     o the Trust in Lending Act and its regulations, which (among other things)
     require disclosures to borrowers regarding the terms of loans provide
     consumers who pledged their principal dwelling as collateral in an
     on-purchase money transaction with a right of rescission that generally
     extends for three days after proper disclosures are given;

     o the Home Ownership and Equity Protection Act and its regulations, which
     (among other things) imposes additional disclosure requirements and
     limitations on loan terms with respect to no-purchase money, installment
     loans secured by the consumer's principal dwelling that have interest rates
     or origination costs in excess of prescribed levels;

     o the Home Equity Loan Consumer Protection Act and its regulations, which
     (among other things) limits changes that may be made to open-end loans
     secured by the consumer's dwelling, and restricts the ability to accelerate
     balances or suspend credit privileges on such loans;

     o the Real Estate Settlement Procedures Act and its regulations, which
     (among other things) prohibit the payment of referral fees for real estate
     settlement services (including mortgage lending and brokerage services) and
     regulate escrow accounts for taxes and insurance and billing inquiries made
     by borrowers;

     o the Equal Credit Opportunity Act and its regulations, which (among other
     things) generally prohibits discrimination in any aspect of a credit
     transaction on certain enumerated basis, such as age, race, color, sex,
     religion, marital status, national origin or receipt of public assistance;

     o the Fair Credit Reporting Act, which (among other things) regulates use
     of consumer reports obtained from consumer reporting agencies and the
     reporting of payment histories to consumer reporting agencies; and

     o the Federal Trade Commission's Rule on Preservation of Consumer Claims
     and Defenses, which generally provides that the rights of an assignee of a
     conditional sales

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     contract (or of certain lenders making purchase money loans) to enforce a
     consumer credit obligation are subject to the claims and defenses that the
     consumer could assert against the seller of goods or services financed in
     the credit transaction.

     The penalties for violating these federal, state or local laws vary
depending on the applicable law and the particular facts of the situation.
However, private plaintiffs typically may assert claims for actual damages and,
in some cases, also may recover civil money penalties or exercise a right to
rescind the loan. Violations of certain laws may limit the ability to collect
all or part of the principal or interest on a loan and, in some cases, borrowers
even may be entitled to a refund of amounts previously paid. Federal, state and
local administrative or law enforcement agencies also may entitled to bring
legal actions, including actions for civil money penalties or restitution, for
violations of certain of these laws.

     Depending on the particular alleged misconduct, it is possible that claims
may be asserted against various participants in secondary market transactions,
including assignees that hold the loans, such as the trust fund. Losses on loans
from the application of these federal, state and local laws that are not
otherwise covered by a credit enhancement will be borne by the holders of one or
more classes of securities.

                         FEDERAL INCOME TAX CONSEQUENCES
GENERAL

     The following is a summary of the anticipated material federal income tax
consequences of the purchase, ownership, and disposition of the securities and
is based on advice of Sidley Austin Brown & Wood LLP, special counsel to the
Depositor. The summary is based upon the provisions and interpretations 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, which 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 securities 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. Prospective Investors are
advised to consult their own tax advisers concerning the federal, state, local
and any other tax consequences to them of the purchase, ownership and
disposition of the securities.

     The federal income tax consequences to Securityholders will vary depending
on whether (i) the securities of a series are classified as indebtedness; (ii)
an election is made to treat the trust fund relating to a particular series of
securities as a REMIC; (iii) the securities represent interests in a grantor
trust; or (iv) the trust fund relating to a particular series of securities is
classified as a partnership. The Prospectus Supplement for each series of
securities will specify how the securities will be treated for federal income
tax purposes and will discuss whether a REMIC election, if any, will be made
with respect to such series. Prior to issuance of each series of securities, the
Depositor shall file with the Commission a Form 8-K on behalf of the related
trust fund containing an opinion of Sidley Austin Brown & Wood LLP with respect
to the validity of the information set forth under "Federal Income Tax
Consequences" herein and in the related Prospectus Supplement.


                                       95


TAXATION OF DEBT SECURITIES

     Interest and Acquisition Discount. The income on securities representing
regular interests in a REMIC are generally treated as evidences of indebtedness
issued by the REMIC. Stated interest on regular interests in REMICs will be
taxable as ordinary income and taken into account using the accrual method of
accounting, regardless of the Securityholder's normal accounting method. Thus, a
taxpayer may be required to report income in respect of a REMIC regular interest
before actually receiving a corresponding cash distribution. Interest (other
than original issue discount) on securities (other than Regular Interest
Securities) that are characterized as indebtedness for federal income tax
purposes will be includible in income by holders thereof in accordance with
their usual methods of accounting. Securities characterized as debt for federal
income tax purposes, including regular interests in REMICs, will be referred to
hereinafter collectively as "Debt Securities."

     Debt Securities that are Compound Interest Securities (i.e., debt
securities that accrete the amount of accrued interest and add that amount to
the principal balance of the securities until maturity or until some specified
event has occurred) will, and certain of the other Debt Securities may, be
issued with "original issue discount" ("OID"). The following discussion is based
in part on the rules governing OID which are set forth in Sections 1271-1275 of
the Code and the Treasury regulations issued thereunder, (the "OID
Regulations"). A Securityholder should be aware, however, that the OID
Regulations do not adequately address certain issues relevant to prepayable
securities, such as the Debt Securities.

     In general, OID, if any, will equal the difference between the stated
redemption price at maturity of a Debt Security and its issue price. A holder of
a Debt Security 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 Debt
Security will be considered to be zero, however, if the interest is less than a
de minimis amount determined under the Code.

     The issue price of a Debt Security is the first price at which a
substantial amount of Debt Securities of that class are sold (excluding sales to
bond houses, brokers, underwriters or wholesalers). If less than a substantial
amount of a particular class of Debt Securities is sold for cash on or prior to
the related Closing Date, the issue price for such class will be treated as the
fair market value of such class on such Closing Date. The issue price of a Debt
Security generally includes the amount paid by an initial Debt Security holder
for accrued interest that relates to a period prior to the issue date of the
Debt Security ("pre-issuance accrued interest"). The issue price of a Debt
Security may, however, be computed without regard to such pre-issuance accrued
interest if such pre-issuance accrued interest will be paid on the first payment
date following the date of issuance. This alternative is available only if the
first payment date occurs within one year of the date of issuance. Under this
alternative, the payment of pre-issuance accrued interest will be treated as a
non-taxable return of capital and not as a payment of interest. The stated
redemption price at maturity of a Debt Security includes the original principal
amount of the Debt Security, but generally will not include stated interest if
it is "qualified stated interest."

     Under the OID Regulations, qualified stated interest generally means
interest payable at a single fixed rate or qualified variable rate (as described
below) provided that such interest

                                       96


payments are unconditionally payable at intervals of one year or less during the
entire term of the Debt Security. The OID Regulations state that interest
payments are unconditionally payable only if a late payment or nonpayment is
expected to be penalized or reasonable remedies exist to compel payment or the
Debt Security otherwise provides terms and conditions that make the likelihood
of late payment or nonpayment a remote contingency. Certain Debt Securities may
provide for default remedies in the event of late payment or nonpayment of
interest. The interest on such Debt Securities will be unconditionally payable
and constitute qualified stated interest, not OID. However, absent clarification
of the OID Regulations, where Debt Securities do not provide for default
remedies, the interest payments will be included in the Debt Security's stated
redemption price at maturity and taxed as OID. Interest is payable at a single
fixed rate only if the rate appropriately takes into account the length of the
interval between payments. Distributions of interest on Debt Securities with
respect to which deferred interest will accrue, will not constitute qualified
stated interest payments, in which case the stated redemption price at maturity
of such Debt Securities includes all distributions of interest as well as
principal thereon. Where the interval between the issue date and the first
Distribution Date on a Debt Security is either longer or shorter than the
interval between subsequent Distribution Dates, all or part of the interest
foregone, in the case of the longer interval, and all of the additional
interest, in the case of the shorter interval, will be included in the stated
redemption price at maturity and tested under the de minimis rule described
below. In the case of a Debt Security with a long first period which has non-de
minimis OID, all stated interest in excess of interest payable at the effective
interest rate for the long first period will be included in the stated
redemption price at maturity and the Debt Security will generally have OID.
Holders of Debt Securities should consult their own tax advisors to determine
the issue price and stated redemption price at maturity of a Debt Security.

     Under the de minimis rule, OID on a Debt Security will be considered to be
zero if such OID is less than 0.25% of the stated redemption price at maturity
of the Debt Security multiplied by the weighted average maturity of the Debt
Security. For this purpose, the weighted average maturity of the Debt Security
is computed as the sum of the amounts determined by multiplying the number of
full years (i.e., rounding down partial years) from the issue date until each
distribution in reduction of stated redemption price at maturity is scheduled to
be made by a fraction, the numerator of which is the amount of each distribution
included in the stated redemption price at maturity of the Debt Security and the
denominator of which is the stated redemption price at maturity of the Debt
Security. Holders generally must report de minimis OID pro rata as principal
payments are received, and such income will be capital gain if the Debt Security
is held as a capital asset. However, accrual method holders may elect to accrue
all de minimis OID as well as market discount under a constant interest method.

     Debt Securities may provide for interest based on a qualified variable
rate. Under the OID Regulations, interest is treated as payable at a qualified
variable rate (and not as contingent interest) if, (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," or a
combination of "qualified floating rates" that do not operate in a manner that
significantly accelerates or defers interest payments on such Debt Security. In
the case of Compound Interest Securities, certain Interest Weighted Securities
(as defined herein), and certain of the other Debt Securities, 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.

                                       97


     The OID Regulations do not contain provisions specifically interpreting
Code Section 1272(a)(6). Until the Treasury issues guidance to the contrary, the
Trustee intends to base its computation on Code Section 1272(a)(6) and the OID
Regulations as described in this Prospectus. However, because no regulatory
guidance currently exists under Code Section 1272(a)(6), there can be no
assurance that such methodology represents the correct manner of calculating
OID.

     The holder of a Debt Security issued with OID must include in gross income,
for all days during its taxable year on which it holds such Debt Security, the
sum of the "daily portions" of such original issue discount. The amount of OID
includible in income by a holder will be computed by allocating to each day
during a taxable year a pro rata portion of the original issue discount that
accrued during the relevant accrual period. In the case of a Debt Security that
is not a regular interest in a REMIC and the principal payments on which are not
subject to acceleration resulting from prepayments on the Loans, the amount of
OID includible in income of a Securityholder for an accrual period (generally
the period over which interest accrues on the debt instrument) will equal the
product of the yield to maturity of the Debt Security and the adjusted issue
price of the Debt Security, reduced by any payments of qualified stated
interest. The adjusted issue price is the sum of its issue price plus prior
accruals or OID, reduced by the total payments made with respect to such Debt
Security in all prior periods, other than qualified stated interest payments.

     The amount of OID to be included in income by a holder of a debt
instrument, such as certain classes of the Debt Securities, that is subject to
acceleration due to prepayments on other debt obligations securing such
instruments (a "Pay-Through Security"), 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 on a Pay-Through Security is the excess (if any) of the sum of (a) the
present value of all payments remaining to be made on the Pay-Through Security
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 Pay-Through
Security, over the adjusted issue price of the Pay-Through Security at the
beginning of the accrual period. The present value of the remaining payments is
to be determined on the basis of three factors: (i) the original yield to
maturity of the Pay-Through Security (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. As a result of this method,
if the rate of prepayments on the Loans exceeds the Prepayment Assumption, the
amount of OID included in income will be higher in earlier periods. Similarly,
if the rate of prepayments on the Loans is less than the Prepayment Assumption,
the amount of OID included in income will be lower in earlier periods. No
representation have been made to the holders that the Loans will prepay at a
rate equal to the Prepayment Assumption (or any other rate).

     Although the OID Regulations do not provide for such adjustments, the
Depositor may adjust the accrual of OID on a class of Debt Securities to take
account of realized losses on the Loans. If the IRS were to require that OID be
accrued without such adjustments, the rate of accrual of OID for a class Debt
Securities could increase.

     Certain classes of Debt Securities may represent more than one class of
REMIC regular interests. Unless otherwise provided in the related Prospectus
Supplement, the Trustee intends,

                                       98


based on the OID Regulations, to calculate OID on such securities as if, solely
for the purposes of computing OID, the separate regular interests were a single
debt instrument.

     A subsequent holder of a Debt Security will also be required to include OID
in gross income, but such a holder who purchases such Debt Security for an
amount that exceeds its adjusted issue price will be entitled (as will an
initial holder who pays more than a Debt Security's issue price) to offset such
OID by comparable economic accruals of portions of such excess.

     Effects of Defaults and Delinquencies. Holders will be required to report
income with respect to REMIC regular interests under an accrual method without
giving effect to delays and reductions in distributions attributable to a
default or delinquency on the Loans, except possibly to the extent that it can
be established that such amounts are uncollectible. As a result, the amount of
income (including OID) reported by a holder of such a security in any period
could significantly exceed the amount of cash distributed to such holder in that
period. The holder will eventually be allowed a loss (or will be allowed to
report a lesser amount of income) to the extent that the aggregate amount of
distributions on the securities is deducted as a result of a Loan default.
However, the timing and character of such losses or reductions in income are
uncertain and, accordingly, holders of securities should consult their own tax
advisors on this point.

     Interest Weighted Securities. It is not clear how income should be accrued
with respect to REMIC regular interests or Stripped Securities (as defined under
"--Tax Status as a Grantor Trust; General" herein) the payments on which consist
solely or primarily of a specified portion of the interest payments on qualified
mortgages held by the REMIC, or on Loans underlying Pass-Through Securities
("Interest Weighted Securities"). The Issuer intends to take the position that
all of the income derived from an Interest Weighted Security should be treated
as OID and that the amount and rate of accrual of such OID should be calculated
by treating the Interest Weighted Security as a Compound Interest Security.
However, in the case of Interest Weighted Securities that are entitled to some
payments of principal and that are REMIC regular interests, the IRS could assert
that income derived from an Interest Weighted Security should be calculated as
if the security were a security purchased at a premium equal to the excess of
the price paid by such holder for such 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. Alternatively, the
IRS could assert that an Interest Weighted Security should be taxable under the
rules governing bonds issued with contingent payments. Such treatment may be
more likely in the case of Interest Weighted Securities that are Stripped
Securities. See "--Tax Status as a Grantor Trust--Discount or Premium on
Pass-Through Securities."

     Variable Rate Debt Securities. In the case of Debt Securities bearing
interest at a rate that varies directly, according to a fixed formula, with an
objective index, it appears that (i) the yield to maturity of such Debt
Securities and (ii) in the case of Pay-Through Securities, the present value of
all payments remaining to be made on such Debt Securities, should be calculated
as if the interest index remained at its value as of the issue date of such
securities. Because the proper method of adjusting accruals of OID on a variable
rate Debt Security is uncertain, holders of variable rate Debt Securities should
consult their own tax advisers regarding the appropriate treatment of such
securities for federal income tax purposes.

                                       99


     Market Discount. A purchaser of a security may be subject to the market
discount rules of Sections 1276-1278 of the Code. A holder that acquires a Debt
Security with more than a prescribed de minimis amount of "market discount"
(generally, the excess of the principal amount of the Debt Security over the
purchaser's purchase price) will be required 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 Debt Security received in that month
and, if the securities are sold, the gain realized. Such market discount would
accrue in a manner to be provided in Treasury regulations but, until such
regulations are issued, such market discount would in general accrue either (i)
on the basis of a constant yield (in the case of a Pay-Through Security, taking
into account a prepayment assumption) or (ii) in the ratio of (a) in the case of
securities (or in the case of a Pass-Through Security (as defined herein), as
set forth below, the Loans underlying such security) 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 securities (or, in the case of a Pass-Through Security, as described
below, the Loans underlying such security) originally issued at a discount, OID
in the relevant period to total OID remaining to be paid.

     Under section 1277 of the Code, the excess of investment interest expense
paid or accrued to purchase or carry a security (or, in the case of a
Pass-Through Security, the underlying Loans) with market discount over interest
received on such security is allowed as a current deduction only to the extent
such excess is greater than the market discount that accrued during the taxable
year 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 security (or
in the case of a Pass-Through Security, an underlying 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 will
not apply.

     Premium. Excluding the discussion above regarding Interest Weighted
Securities, a holder who purchases a Debt Security at a cost greater than its
stated redemption price at maturity, generally may elect to amortize the premium
as an offset to interest income on such security (but not as a separate
deduction item) on a constant yield method. Although no regulations addressing
the computation of premium accrual on securities similar to the securities have
been issued, the legislative history of the 1986 Act indicates that premium is
to be accrued in the same manner as market discount. Accordingly, it appears
that the accrual of premium on a class of Pay-Through Securities will be
calculated using the prepayment assumption used in pricing such class. An
election to amortize premium will apply to all taxable debt instruments
(including all REMIC regular interests and all pass-through certificates
representing ownership interests in a trust holding debt obligations) 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.
Furthermore, the election will be irrevocable without the consent of the IRS.
Purchasers who pay a premium for the securities should consult their tax
advisers regarding the election to amortize premium and the method to be
employed.

     Election to Treat All Interest as Original Issue Discount. A holder of a
Debt Security may elect to accrue all interest, discount (including de minimis
market or original issue discount) and premium in income as interest, based on a
constant yield method. If such an election were to be made with respect to a
Debt Security with market discount, the holder of the Debt Security

                                      100


would be deemed to have made an election to include in income currently market
discount with respect to all other debt instruments having market discount that
such holder of the Debt Security acquires during the year of the election or
thereafter. Similarly, a holder of a Debt Security that makes this election for
a Debt Security that is acquired at a premium will be deemed to have made an
election to amortize bond premium with respect to all debt instruments having
amortizable bond premium that such holder owns or acquires. The election to
accrue interest, discount and premium on a constant yield method with respect to
a Debt Security is irrevocable.

TAXATION OF THE REMIC AND ITS HOLDERS

     General. In the opinion of Sidley Austin Brown & Wood LLP, special counsel
to the Depositor, if a REMIC election is made with respect to a series of
securities, then the arrangement by which the securities of that series are
issued will be treated as a REMIC as long as all of the provisions of the
applicable Agreement are complied with. Securities will be designated as
"Regular Interests" or "Residual Interests" in a REMIC, as specified in the
related Prospectus Supplement.

     Except to the extent specified otherwise in a Prospectus Supplement, if a
REMIC election is made with respect to a series of securities, (i) securities
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) and (ii) securities held by a real estate investment trust
will constitute "real estate assets" within the meaning of Code Section
856(c)(5)(B), and income with respect to the securities will be considered
"interest on obligations secured by mortgages on real property or on interests
in real property" within the meaning of Code Section 856(c)(3)(B). Not
withstanding the above, if less than 95% of the REMIC's assets consist of assets
described in (i) or (ii) above, then a security will qualify for the tax
treatment described in (i) or (ii) in the proportion that such REMIC assets are
qualifying assets.

REMIC EXPENSES; SINGLE CLASS REMICS

     As a general rule, all of the expenses of a REMIC will be taken into
account by holders of the Residual Interest Securities. In the case of a "single
class REMIC," however, the expenses will be allocated, under Treasury
regulations, among the holders of the Regular Interest Securities and the
holders of the Residual Interest Securities on a daily basis in proportion to
the relative amounts of income accruing to each holder on that day. 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.
Unless otherwise specified in the related Prospectus Supplement, the expenses of
the REMIC will be allocated to holders of the related residual interest
securities. In the case of a holder of a Regular Interest Security 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 holder, exceed 2% of such holder's adjusted gross
income. In addition, Section 68 of the Internal Revenue Code provides that the
amount of itemized deductions otherwise allowable for an individual whose
adjusted gross income exceeds a certain amount (the "Applicable Amount") will be
reduced by the lesser of 3% of the excess of the individual's adjusted gross
income over

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the Applicable Amount or 80% of the amount of itemized deductions otherwise
allowable for the taxable year. This reduction is scheduled to be phased out
from 2006 through 2009, and reinstated after 2010 under the Economic Growth and
Tax Relief Reconciliation Act of 2001 (the "2001 Act"). The reduction or
disallowance of this deduction may have a significant impact on the yield of the
Regular Interest Security to such a holder.

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. As described above, 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 the Loans and other assets and (ii) deductions, including
stated interest and original issue discount accrued on Regular Interest
Securities, amortization of any premium with respect to the Loans, and servicing
fees and other expenses of the REMIC. In the case 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)
deduction for servicing fees payable on the Loans (or other administrative
expenses) for a given taxable year will be limited to the amount by which such
expenses, when aggregated with such holder's other miscellaneous itemized
deductions for that year, exceed two percent of such holder's adjusted gross
income.

     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 Startup
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.

     Subject to possible application of the de minimis rules, the method of
accrual by the REMIC of OID income on the Loans will be equivalent to the method
under which holders of Pay-Through Securities accrue original issue discount
(i.e., under the constant yield method taking into account the Prepayment
Assumption). The REMIC will deduct OID on the Regular Interest Securities in the
same manner that the holders of the Regular Interest Securities include such
discount in income, but without regard to the de minimis rules. See "Taxation of
Debt Securities" 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.

     If the REMIC's basis allocable to the Loans that it holds exceeds their
principal amounts, the excess or premium will generally be amortized over the
life of the loans (taking into account the Prepayment Assumption) on a constant
yield method.

     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 prohibited transactions or any deductions attributable to any prohibited
transaction that resulted in a loss. In general, prohibited

                                      102


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 Startup Day. The holders of
Residual Interest Securities will generally be responsible for the payment of
any such taxes imposed on the REMIC. However, to the extent not paid by such
holders or otherwise, however, such taxes will be paid out of the trust fund and
will be allocated pro rata to all outstanding classes of securities of such
REMIC.

TAXATION OF HOLDERS OF RESIDUAL INTEREST SECURITIES

     The holder of a security representing a residual interest in a REMIC (a
"Residual Interest Security") 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
Securities in proportion to their respective holdings on such day.

     The holder of a Residual Interest Security 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. Examples of
situations of "phantom income," the reporting of taxable income without
corresponding distributions include the receipt by the REMIC of OID income, or
use of interest payments received to pay down principal on the regular interest
securities. If this occurs, excluding the possibility of further losses, it is
likely that cash distributions will exceed taxable income in later years.
Accordingly, taxable income may also be greater in earlier years of the REMIC as
a result of the fact that interest expense deductions, as a percentage of
outstanding principal on REMIC Regular Interest Securities, will typically
increase over time as lower yielding securities 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
Security 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. Furthermore, the Residual
Interest Certificate may be structured so that it is unlikely to receive any
significant cash distributions. Therefore, the after-tax yield on the Residual
Interest Security may be negative (or less than that of a similar corporation
bond or stripped 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 Security 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

                                      103


disallowed loss may be carried forward indefinitely, but may be used only to
offset income of the REMIC generated by the same REMIC. The ability of holders
of Residual Interest Securities 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 Security, if any, will
generally not result in any additional taxable income or loss to a holder of a
Residual Interest Security. If the amount of such payment exceeds a holder's
adjusted basis in the Residual Interest Security, however, the holder will
recognize gain (treated as gain from the sale of the Residual Interest Security)
to the extent of such excess.

     Sale or Exchange. A holder of a Residual Interest Security will recognize
gain or loss on the sale or exchange of a Residual Interest Security equal to
the difference, if any, between the amount realized and such holder's adjusted
basis in the Residual Interest Security at the time of such sale or exchange.
Any loss upon disposition of a Residual Interest Security will be disallowed if
the selling holder acquires any residual interest in a REMIC or similar mortgage
pool within six months before or after such disposition.

     Excess Inclusions. The portion of the REMIC taxable income of a holder of a
Residual Interest Security consisting of "excess inclusion" income may not be
offset by other deductions or losses, including net operating losses, on such
holder's federal income tax return. Further, if the holder of a Residual
Interest Security is an organization subject to the tax on unrelated business
income imposed by Code Section 511, such holder's excess inclusion income will
be treated as unrelated business taxable income of such holder. 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 Security, 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 Security 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, is not eligible for treatment as "portfolio
interest" and is subject to certain additional limitations. See "Tax Treatment
of Foreign Investors."

     Three special rules apply for determining the effect of excess inclusions
on the alternative minimum taxable income of a residual holder. First,
alternative minimum taxable income for a 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 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.

     In the case of a Residual Interest Security that has no significant value,
the excess inclusion portion of a REMIC's income is generally equal to all of
the REMIC taxable income allocable to the residual holder. In other cases, 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 Security, over the daily accruals for such quarterly period of (i) 120%
of the long term applicable federal rate on the Startup Day multiplied by (ii)
the adjusted issue price of such Residual Interest Security at the beginning of
such quarterly period. The adjusted issue price of a Residual Interest 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),

                                      104


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 Security 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.

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

     Restrictions on Ownership and Transfer of Residual Interest Securities. 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 applicable Pooling and Servicing Agreement will prohibit
Disqualified Organizations from owning a Residual Interest Security. In
addition, the pooling and servicing agreement will require that a transferee of
a Residual Interest Security deliver to the Trustee an affidavit representing
and warranting that it is neither a Disqualified Organization nor an agent or
nominee acting on behalf of a Disqualified Organization, before a transfer of
the Residual Interest Security.

     If, in violation of the restrictions set forth above, a Residual Interest
Security is transferred to a Disqualified Organization, a substantial tax can 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 after March 31, 1988 (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 the Disqualified
Organization's pass-through 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. 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. The REMIC Regulations provide no guidance as to how to determine
if a significant purpose of a transfer is to impede the assessment or collection
of tax. A similar type of limitation exists with respect to certain transfers of
residual

                                      105


interests by foreign persons to United States persons. See "--Tax Treatment of
Foreign Investors."

     Any transfer of the Residual Interest Security will be disregarded for
federal tax purposes if a significant purpose of the transfer was to enable the
seller to impede the assessment or collection of tax. As set forth in Treasury
Regulations, a significant purpose to impede the assessment or collection of tax
exists if the seller, at the time of the transfer, either knew or should have
known that the transferee would be unwilling or unable to pay taxes due on its
share of the taxable income of the REMIC. Notwithstanding the above, a transfer
will be respected if (a) the transferor has performed reasonable investigations
of the transferee and has no knowledge or no reason to know that a transferee
intended to impede the assessment or collection of taxes, (b) the transfer is
not made to a foreign permanent establishment or fixed base of a U.S. taxpayer
(an "OFFSHORE LOCATION"), (c) the transferee represents that it will not cause
income from the Class A-R Certificate to be attributable to an offshore location
and (d) one of the two tests set forth in Treasury regulations issued on July
19, 2002 is satisfied.

     Under the first alternative test, a transfer by the holder of the Residual
Interest Security will, assuming all other requirements of the safe harbor are
met, qualify for the safe harbor if the present value of the anticipated tax
liabilities associated with holding the residual interest does not exceed the
sum of the present value of: (a) any consideration given to the purchaser to
acquire the interest; (b) the expected future distributions on the interest; and
(c) the anticipated tax savings associated with holding the interest as the
REMIC generates losses. For purposes of this test, the transferee generally must
use the highest corporate tax rate and the discount rate must be equal to the
Federal short-term rate prescribed by section 1274(d) for the month of the
transfer. Under the second alternative test, a transfer by the holder of the
Residual Interest Security will, assuming all other requirements of the safe
harbor are met, qualify for the safe harbor if: (a) the price paid by the
transferee for the Residual Interest Security would not cause a reasonable
person to believe the transferee does not intend to pay the taxes associated
with such certificate, (b) the transferee is an "eligible corporation" and (c)
for the two fiscal years preceding the transfer, the transferee's gross assets
for financial reporting purposes exceeded $100 million and its net assets for
financial reporting purposes exceeded $10 million (excluding certain related
party transactions).

     The Treasury Department has issued final regulations, effective May 11,
2004, that address the federal income tax treatment of "inducement fees"
received by transferees of noneconomic REMIC residual interests. The final
regulations require inducement fees to be included in income over a period
reasonably related to the period in which the related REMIC residual interest is
expected to generate taxable income or net loss allocable to the holder. The
final regulations provide two safe harbor methods that permit transferees to
include inducement fees in income either (i) in the same amounts and over the
same period that the taxpayer uses for financial reporting purposes, provided
that such period is not shorter than the period the REMIC is expected to
generate taxable income or (ii) ratably over the remaining anticipated weighted
average life of all the regular and residual interests issued by the REMIC,
determined based on actual distributions projected as remaining to be made on
such interests under the prepayment assumption. If the holder of a REMIC
residual interest sells or otherwise disposes of the Residual Interest Security,
any unrecognized portion of the inducement fee must be taken into account at the
time of the sale or disposition. The final regulations also provide that an
inducement fee shall be treated as income from sources within the United States.
In addition, the IRS has issued

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administrative guidance addressing the procedures by which transferees of
noneconomic REMIC residual interests may obtain automatic consent from the IRS
to change the method of accounting for REMIC inducement fee income to one of the
safe harbor methods provided in these final regulations (including a change from
one safe harbor method to the other safe harbor method). Prospective purchasers
of the Residual Interest Security should consult with their tax advisors
regarding the effect of these final regulations and the related guidance
regarding the procedures for obtaining automatic consent to change the method of
accounting.

     Mark to Market Rules. Prospective purchasers of a REMIC Residual Interest
Security should be aware that a REMIC Residual Interest Security acquired after
January 3, 1995 cannot be marked-to-market.

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. Ordinarily, 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 IRS in a
unified administrative proceeding.

TAX STATUS AS A GRANTOR TRUST

     In the absence of a REMIC election, a trust fund generally will be
classified as a grantor trust if (i) there is either only one class of
securities that evidences the entire undivided beneficial ownership of the Trust
Fund Assets, or, if there is more than one class of securities, each class
represents a direct investment in the Trust Fund Assets, and (ii) no power
exists under the related Agreement to vary the investment of the
Securityholders. If these conditions are satisfied, the related Prospectus
Supplement will recite that in the opinion of Sidley Austin Brown & Wood LLP,
special counsel to the Depositor, the trust fund relating to a series of
securities will be classified for federal income tax purposes as a grantor trust
under Subpart E, Part I of Subchapter J of the Code (the securities of such
series, "Pass-Through Securities"). In some series there will be no separation
of the principal and interest payments on the Loans. In such circumstances, a
holder will be considered to have purchased a pro rata undivided interest in
each of the Loans. In other cases, sale of the securities ("Stripped
Securities") will produce a separation in the ownership of all or a portion of
the principal payments from all or a portion of the interest payments on the
Loans.

     Each holder must report on its federal income tax return its share of the
gross income derived from the Loans (without reduction for the amount payable as
fees to the Trustee and the Servicer and similar fees (collectively, the
"Servicing Fee"), and deduct such Servicing Fees as if the holder held the loans
directly (according to the holder's tax accounting method. In the case of
Pass-Through Securities, other than Stripped Securities, such income will
consist of a pro rata share of all of the income derived from all of the Loans.
In the case of Stripped Securities, such income will consist of a pro rata share
of the income derived from each stripped bond or stripped coupon in which the
holder owns an interest. The holder of a security 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 Servicer (or third parties that are
compensated for the performance of services). In the case of

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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, for taxable years
beginning after December 31, 1990, the amount of itemized deductions otherwise
allowable for the taxable year for an individual whose adjusted gross income
exceeds the applicable amount (which amount will be adjusted for inflation in
taxable years beginning after 1990) 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.
These percentages are scheduled to be reduced in 2006 and return to current
levels in 2010.

     Discount or Premium on Pass-Through Securities. The holder's purchase price
of a Pass-Through Security is to be allocated among the Loans in proportion to
their relative fair market values, determined as of the time of purchase of the
securities. In the typical case, the Trustee (to the extent necessary to fulfill
its reporting obligations) will treat each Loan as having a fair market value
proportional to the share of the aggregate principal balances of all of the
Loans that it represents, because the securities, unless otherwise specified in
the related 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 Pass-Through Security allocated to a 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 Loan
allocable to the security, the interest in the Loan allocable to the
Pass-Through Security 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 OID or market discount. In the case of a Loan with more than a "de
minimis" amount of OID or a Stripped Security, a holder of a security will be
required to report as interest income its share of the amount of OID that
accrues during that year in the manner described above. OID with respect to a
Loan could arise, for example, by virtue of the financing of points by the
originator of the Loan, or by virtue of the charging of points by the originator
of the 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. Any market discount (or premium) on a Loan will be
includible in income (or an amortized reduction of income) in the manner
described above, except that in the case of Pass-Through Securities, market
discount is calculated with respect to the Loans underlying the Certificate,
rather than with respect to the security. See "--Taxation of Debt Securities;
Market Discount" and "--Premium" above.

     In the case of market discount on a Pass-Through Security attributable to
Loans originated on or before July 18, 1984, the holder generally will be
required to allocate the portion of such discount that is allocable to a loan
among the principal payments on the Loan and to include the discount allocable
to each principal payment in ordinary income at the time such principal payment
is made. Such treatment would generally result in discount being included in
income at a slower rate than discount would be required to be included in income
using the method described in the preceding paragraph.

     Stripped Securities. A Stripped Security may represent a right to receive
only a portion of the interest payments on the Loans, a right to receive only
principal payments on the Loans, or a right to receive certain payments of both
interest and principal. Certain Stripped Securities

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("Ratio Strip Securities") may represent a right to receive differing
percentages of both the interest and principal on each 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 OID rules to
stripped bonds and stripped coupons. For purposes of computing OID, 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).

     Servicing fees in excess of reasonable servicing fees ("excess servicing")
will be treated under the stripped bond rules. If the excess servicing fee is
less than 100 basis points (i.e., 1% interest on the Loan principal balance) or
the securities are initially sold with a de minimis discount (assuming no
prepayment assumption is required), any non-de minimis discount arising from a
subsequent transfer of the securities should be treated as market discount. The
IRS appears to require that reasonable servicing fees be calculated on a Loan by
Loan basis, which could result in some Loans being treated as having more than
100 basis points of interest stripped off.

     OID Regulations and judicial decisions provide no direct guidance as to how
the interest and original issue discount rules are to apply to Stripped
Securities and other Pass-Through Securities. Under the method described above
for Pay-Through Securities (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. However, the 1986 Act does not, absent Treasury regulations, appear
specifically to cover instruments such as the Stripped Securities that
technically represent ownership interests in the underlying Loans, rather than
being debt instruments "secured by" those loans. For tax years beginning after
August 5, 1997 the Taxpayer Relief Act of 1997 may allow use of the Cash Flow
Bond Method with respect to Stripped Securities and other Pass-Through
Securities because it provides that such method applies to any pool of debt
instruments the yield on which may be affected by prepayments. Nevertheless, it
is believed that the Cash Flow Bond Method is a reasonable method of reporting
income for such securities, and it is expected that OID will be reported on that
basis unless otherwise specified in the related Prospectus Supplement. In
applying the calculation to Pass-Through Securities, the Trustee will treat all
payments to be received by a holder with respect to the underlying Loans as
payments on a single installment obligation. The IRS could, however, assert that
original issue discount must be calculated separately for each Loan underlying a
security.

     Under certain circumstances, if the Loans prepay at a rate faster than the
Prepayment Assumption, the use of the Cash Flow Bond Method may accelerate a
holder's recognition of income. If, however, the Loans prepay at a rate slower
than the Prepayment Assumption, the use of this method may delay a holder's
recognition of income.

     In the case of a Stripped Security that is an Interest Weighted Security,
the Trustee intends, to report income to Securityholders as OID, in the manner
described above for Interest Weighted Securities.

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     Possible Alternative Characterizations. The characterizations of the
Stripped Securities described above are not the only possible interpretations of
the applicable Code provisions. Among other possibilities, the IRS could contend
that (i) in certain series, each non-Interest Weighted Security is composed of
an unstripped undivided ownership interest in Loans and an installment
obligation consisting of stripped principal payments; (ii) the non-Interest
Weighted Securities are subject to the contingent payment provisions of the
Contingent Regulations; or (iii) each Interest Weighted Stripped Security is
composed of an unstripped undivided ownership interest in Loans and an
installment obligation consisting of stripped interest payments.

     Potential purchasers are urged to consult their own tax advisers regarding
the proper treatment of the securities for federal income tax purposes.

     Character as Qualifying Loans. In the case of Stripped Securities, although
there is no specific legal authority existing regarding whether the character of
the securities, for federal income tax purposes, will be the same as the Loans.
The IRS could take the position that the Loans' character is not carried over to
the securities in such circumstances. Pass-Through Securities will be, and,
although the matter is not free from doubt, Stripped Securities should be
considered to represent "real estate assets" within the meaning of Section
856(c)(5)(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 securities 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. Reserves or
funds underlying the securities may cause a proportionate reduction in the
above-described qualifying status categories of securities.

SALE OR EXCHANGE

     Subject to the discussion below with respect to trust funds classified as
partnerships, a holder's tax basis in its security is the price such holder pays
for a security, plus amounts of original issue or market discount included in
income and reduced by any payments received (other than qualified stated
interest payments) and any amortized premium. Gain or loss recognized on a sale,
exchange, or redemption of a security, measured by the difference between the
amount realized and the security's basis as so adjusted, will generally be
capital gain or loss, assuming that the security is held as a capital asset. In
the case of a security held by a bank, thrift, or similar institution described
in Section 582 of the Code, however, gain or loss realized on the sale or
exchange of a REMIC regular interest will be taxable as ordinary income or loss.
In addition, gain from the disposition of a REMIC regular interest that might
otherwise be capital gain will be treated as ordinary income to the extent of
the excess, if any, of the amount that would have been includible in the
holder's income if the yield on such REMIC regular interest security had equaled
110% of the applicable federal rate as of the beginning of such holder's holding
period, over the amount of ordinary income actually recognized by the holder
with respect to such REMIC regular interest.

MISCELLANEOUS TAX ASPECTS

     Backup Withholding. Subject to the discussion below with respect to trust
funds classified as partnerships, a holder, other than a holder of a Residual
Interest Security, may, under certain circumstances, be subject to "backup
withholding" with respect to distributions or the proceeds of a sale of
certificates to or through brokers that represent interest or original issue
discount on

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the securities. This withholding generally applies if the holder of a security
(i) fails to furnish the Trustee with its taxpayer identification number
("TIN"); (ii) furnishes the Trustee 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 Trustee 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 holders, including payments to certain
exempt recipients (such as exempt organizations) and to certain Nonresidents (as
defined below). holders should consult their tax advisers as to their
qualification for exemption from backup withholding and the procedure for
obtaining the exemption.

     The Trustee will report to the holders and to the Servicer 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 securities.

PROPOSED REPORTING REGULATIONS

     In June 2002, the IRS and Treasury Department proposed new rules concerning
the reporting of tax information with respect to "Widely Held Mortgage Trusts."
If these rules are finalized, the Trustee may be compelled, or have an
opportunity, to adopt new ways of calculating and reporting tax items (such as
OID, market discount, sale proceeds and premium) to the Holders of Pass-Through
Securities, which changes may affect the timing of when a Holder reports such
items.

TAX TREATMENT OF FOREIGN INVESTORS

     Subject to the discussion below with respect to trust funds classified as
partnerships, interest will normally qualify as portfolio interest unless (i)
the recipient is a holder, directly or by attribution, of 10% or more of the
capital or profits interest in the issuer (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 obligations to withhold 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 an applicable rate (unless reduced or eliminated by a tax treaty)
on, among other things, interest and other fixed or determinable, annual or
periodic income paid to a nonresident alien individual, foreign partnership or
foreign corporation ("Nonresidents"). Holders of Pass-Through Securities and
Stripped Securities, including Ratio Strip Securities, however, may be subject
to withholding to the extent that the Loans were originated on or before July
18, 1984 and with respect to any foreclosure property owned by the trust funds.

     Notwithstanding the above, interest and OID of Securityholders who are
Nonresidents are not subject to withholding if they are effectively connected
with a United States business conducted by the holder. They will, however,
generally be subject to the regular United States income tax.

     Payments to holders of Residual Interest Securities who are Nonresidents
will generally be treated as interest for purposes United States withholding
tax. It is clear that, to the extent that a payment constitutes excess inclusion
income, a holder of a Residual Interest Security will not be entitled to an
exemption from or reduction withholding tax. If the payments are subject to
United

                                      111


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 Securities 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
interest holder amounts that will equal the amount of tax resulting from the
REMIC's excess inclusion income, and that such amounts will be distributed at or
after the time at which the excess inclusions accrue and not later than 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 and 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 Inclusions."

TAX CHARACTERIZATION OF THE TRUST FUND AS A PARTNERSHIP

     In the absence of a REMIC election, a trust fund that is not classified as
a grantor trust will be classified as a partnership for federal tax purposes.
Sidley Austin Brown & Wood LLP, special counsel to the Depositor, will deliver
its opinion that a trust fund classified as a partnership will not be a publicly
traded partnership taxable as a corporation for federal income tax purposes.
This opinion will be based on the assumption that the terms of the Trust
Agreement and related documents will be complied with, and on counsel's
conclusions that the nature of the income of the trust fund will exempt it from
the rule that certain publicly traded partnerships are taxable as corporations
or the issuance of the securities has been structured as a private placement
under an IRS safe harbor, so that the trust fund will not be characterized as a
publicly traded partnership taxable as a corporation.

     If the trust fund were taxable as a corporation for federal income tax
purposes, the trust fund would be subject to corporate income tax on its taxable
income. The trust fund's taxable income would include all its income, possibly
reduced by its interest expense on the notes. Any such corporate income tax
could materially reduce cash available to make payments on the notes and
distributions on the certificates, and certificateholders could be liable for
any such tax that is unpaid by the trust fund.

TAX CONSEQUENCES TO HOLDERS OF THE NOTES

     Treatment of the Notes as Indebtedness. The trust fund will agree, and the
Noteholders will agree by their purchase of notes, to treat the notes as debt
for federal income tax purposes. Special counsel to the Depositor will, except
as otherwise provided in the related Prospectus Supplement, advise the Depositor
that the notes will be classified as debt for federal income tax purposes. The
tax treatment of the notes is described under the caption "Taxation of Debt
Securities" set forth above.


                                      112


TAX CONSEQUENCES TO HOLDERS OF THE CERTIFICATES

     Treatment of the Trust Fund as a Partnership. The trust fund and the Master
Servicer will agree, and the certificateholders will agree by their purchase of
certificates, to treat the trust fund as a partnership for purposes of federal
and state income tax, franchise tax and any other tax measured in whole or in
part by income, with the assets of the partnership being the assets held by the
trust fund, the partners of the partnership being the certificateholders, and
the notes being debt of the partnership. However, the proper characterization of
the arrangement involving the certificates, the notes, the trust fund and the
Servicer is not clear because there is no authority on transactions closely
comparable to that contemplated herein.

     A variety of alternative characterizations are possible. For example,
because the certificates have certain features characteristic of debt, the
certificates might be considered debt of the trust fund. Any such
characterization would not result in materially adverse tax consequences to
certificateholders as compared to the consequences from treatment of the
certificates as equity in a partnership, described below. The following
discussion assumes that the certificates represent equity interests in a
partnership.

     Indexed Securities, etc. The following discussion assumes that all payments
on the certificates are denominated in U.S. dollars, none of the certificates
are Indexed Securities or Strip Certificates, and that a series of securities
includes a single class of certificates. If these conditions are not satisfied
with respect to any given series of certificates, additional tax considerations
with respect to such certificates will be disclosed in the applicable Prospectus
Supplement.

     Partnership Taxation. As a partnership, the trust fund will not be subject
to federal income tax. Rather, each certificateholder will be required to
separately take into account such holder's allocated share of income, gains,
losses, deductions and credits of the trust fund. The trust fund's income will
consist primarily of interest and finance charges earned on the Loans (including
appropriate adjustments for market discount, OID and bond premium) and any gain
upon collection or disposition of Loans. The trust fund's deductions will
consist primarily of interest accruing with respect to the notes, servicing and
other fees, and losses or deductions upon collection or disposition of Loans.

     The tax items of a partnership are allocable to the partners in accordance
with the Code, Treasury regulations and the partnership agreement (here, the
Trust Agreement and related documents). The Trust Agreement will provide, in
general, that the certificateholders will be allocated taxable income of the
trust fund for each month equal to the sum of (i) the interest that accrues on
the certificates in accordance with their terms for such month, including
interest accruing at the Pass-Through Rate for such month and interest on
amounts previously due on the certificates but not yet distributed; (ii) any
trust fund income attributable to discount on the Loans that corresponds to any
excess of the principal amount of the certificates over their initial issue
price (iii) prepayment premium payable to the certificateholders for such month;
and (iv) any other amounts of income payable to the certificateholders for such
month. Such allocation will be reduced by any amortization by the trust fund of
premium on Loans that corresponds to any excess of the issue price of
certificates over their principal amount. All remaining taxable income of the
trust fund will be allocated to the owner of the transferor interest. Based on
the economic arrangement of the parties, this approach for allocating trust fund
income should be permissible under applicable Treasury regulations, although no
assurance can be given that the

                                      113


IRS would not require a greater amount of income to be allocated to
certificateholders. Moreover, even under the foregoing method of allocation,
certificateholders may be allocated income equal to the entire Pass-Through Rate
plus the other items described above even though the trust fund might not have
sufficient cash to make current cash distributions of such amount. Thus, cash
basis holders will in effect be required to report income from the certificates
on the accrual basis and certificateholders may become liable for taxes on trust
fund income even if they have not received cash from the trust fund to pay such
taxes. In addition, because tax allocations and tax reporting will be done on a
uniform basis for all certificateholders but certificateholders may be
purchasing certificates at different times and at different prices,
certificateholders may be required to report on their tax returns taxable income
that is greater or less than the amount reported to them by the trust fund.

     All of the taxable income allocated to a certificateholder that is a
pension, profit sharing or employee benefit plan or other tax-exempt entity
(including an individual retirement account) will constitute "unrelated business
taxable income" generally taxable to such a holder under the Code.

     An individual taxpayer's share of expenses of the trust fund (including
fees to the Servicer but not interest expense) would be miscellaneous itemized
deductions. Such deductions might be disallowed to the individual in whole or in
part and might result in such holder being taxed on an amount of income that
exceeds the amount of cash actually distributed to such holder over the life of
the trust fund.

     The trust fund intends to make all tax calculations relating to income and
allocations to certificateholders on an aggregate basis. If the IRS were to
require that such calculations be made separately for each Loan, the trust fund
might be required to incur additional expense but it is believed that there
would not be a material adverse effect on certificateholders.

     Discount and Premium. It is believed that the Loans were not issued with
OID, and, therefore, the trust fund should not have OID income. However, the
purchase price paid by the trust fund for the Loans may be greater or less than
the remaining principal balance of the Loans at the time of purchase. If so, the
Loan will have been acquired at a premium or discount, as the case may be. As
indicated above, the trust fund will make this calculation on an aggregate
basis, but might be required to recompute it on a Loan by Loan basis.

     If the trust fund acquires the Loans at a market discount or premium, the
trust fund will elect to include any such discount in income currently as it
accrues over the life of the Loans or to any such premium against interest
income on the Loans. As indicated above, a portion of such market discount
income or premium deduction may be allocated to certificateholders.

     Section 708 Termination. Under Code Section 708 and regulations thereunder,
a sale or exchange of 50% or more of the capital and profits in a partnership
would cause a deemed contribution of assets of the partnership (the "old
partnership") to a new partnership (the "new partnership") in exchange for
interests in the new partnership. Such interests would be deemed distributed to
the partners of the old partnership in liquidation thereof, which would not
constitute a sale or exchange. Accordingly, if the trust fund were characterized
as a partnership and a sale of certificates terminated the partnership, the
purchaser's basis in its ownership interest would not change.

                                      114


     Disposition of Certificates. Generally, capital gain or loss will be
recognized on a sale of certificates in an amount equal to the difference
between the amount realized and the seller's tax basis in the certificates sold.
A certificateholder's tax basis in a Certificate will generally equal the
holder's cost increased by the holder's share of trust fund income (includible
in income) and decreased by any distributions received (or losses incurred) with
respect to such Certificate. In addition, both the tax basis in the certificates
and the amount realized on a sale of a Certificate would include the holder's
share of the notes and other liabilities of the trust fund. A holder acquiring
certificates at different prices may be required to maintain a single aggregate
adjusted tax basis in such certificates, and, upon sale or other disposition of
some of the certificates, allocate a portion of such aggregate tax basis to the
certificates sold (rather than maintaining a separate tax basis in each
Certificate for purposes of computing gain or loss on a sale of that
Certificate).

     Any gain on the sale of a Certificate attributable to the holder's share of
unrecognized accrued market discount on the Loans would generally be treated as
ordinary income to the holder and would give rise to special tax reporting
requirements. The trust fund does not expect to have any other assets that would
give rise to such special reporting requirements. Thus, to avoid those special
reporting requirements, the trust fund will elect to include market discount in
income as it accrues.

     If a certificateholder is required to recognize an aggregate amount of
income (not including income attributable to disallowed itemized deductions
described above) over the life of the certificates that exceeds the aggregate
cash distributions with respect thereto, such excess will generally give rise to
a capital loss upon the retirement of the certificates.

     Allocations Between Transferors and Transferees. In general, the trust
fund's taxable income and losses will be determined monthly and the tax items
for a particular calendar month will be apportioned among the certificateholders
in proportion to the principal amount of certificates owned by them as of the
close of the last day of such month. As a result, a holder purchasing
certificates may be allocated tax items (which will affect its tax liability and
tax basis) attributable to periods before the actual transaction.

     The use of such a monthly convention may not be permitted by existing
regulations. If a monthly convention is not allowed (or only applies to
transfers of less than all of the partner's interest), taxable income or losses
of the trust fund might be reallocated among the certificateholders. The trust
fund's method of allocation between transferors and transferees may be revised
to conform to a method permitted by future regulations.

     Section 754 Election. In the event that a certificateholder sells its
certificates at a profit (loss), the purchasing certificateholder will have a
higher (lower) basis in the certificates than the selling certificateholder had.
The tax basis of the trust fund's assets will not be adjusted to reflect that
higher (or lower) basis unless the trust fund were to file an election under
Section 754 of the Code. In order to avoid the administrative complexities that
would be involved in keeping accurate accounting records, as well as potentially
onerous information reporting requirements, the trust fund will not make such
election. As a result, certificateholders might be allocated a greater or lesser
amount of trust fund income than would be appropriate based on their own
purchase price for certificates.

     Administrative Matters. The Owner Trustee is required to keep or have kept
complete and accurate books of the trust fund which will be maintained for
financial reporting and tax

                                      115


purposes on an accrual basis and the fiscal year will be the calendar year. The
Trustee will file a partnership information return (IRS Form 1065) with the IRS
for each taxable year of the trust fund and will report each certificateholder's
allocable share of items of trust fund income and expense to holders and the IRS
on Schedule K-1. The trust fund will provide the Schedule K-l information to
nominees that fail to provide the trust fund with the information statement
described below and such nominees will be required to forward such information
to the beneficial owners of the certificates. Generally, holders must file tax
returns that are consistent with the information return filed by the trust fund
or be subject to penalties unless the holder notifies the IRS of all such
inconsistencies.

     Under Section 6031 of the Code, any person that holds certificates as a
nominee at any time during a calendar year is required to furnish the trust fund
with a statement containing certain information on the nominee, the beneficial
owners and the certificates so held. Such information includes (i) the name,
address and taxpayer identification number of the nominee and (ii) as to each
beneficial owner (x) the name, address and identification number of such person,
(y) whether such person is a United States person, a tax-exempt entity or a
foreign government, an international organization, or any wholly owned agency or
instrumentality of either of the foregoing and (z) certain information on
certificates that were held, bought or sold on behalf of such person throughout
the year. In addition, brokers and financial institutions that hold certificates
through a nominee are required to furnish directly to the trust fund information
as to themselves and their ownership of certificates. A clearing agency
registered under Section 17A of the Exchange Act is not required to furnish any
such information statement to the trust fund. The information referred to above
for any calendar year must be furnished to the trust fund on or before the
following January 31. Nominees, brokers and financial institutions that fail to
provide the trust fund with the information described above may be subject to
penalties.

     The Depositor will be designated as the tax matters partner in the related
Trust Agreement and, as such, will be responsible for representing the
certificateholders in any dispute with the IRS. The Code provides for
administrative examination of a partnership as if the partnership were a
separate and distinct taxpayer. Generally, the statute of limitations for
partnership items does not expire before three years after the date on which the
partnership information return is filed. Any adverse determination following an
audit of the return of the trust fund by the appropriate taxing authorities
could result in an adjustment of the returns of the certificateholders, and,
under certain circumstances, a certificateholder may be precluded from
separately litigating a proposed adjustment to the items of the trust fund. An
adjustment could also result in an audit of a certificateholder's returns and
adjustments of items not related to the income and losses of the trust fund.

     Tax Consequences to Foreign Certificateholders. It is not clear whether the
trust fund would be considered to be engaged in a trade or business in the
United States for purposes of federal withholding taxes with respect to non-U.S.
Persons because there is no clear authority dealing with that issue under facts
substantially similar to those described herein. Although it is not expected
that the trust fund would be engaged in a trade or business in the United States
for such purposes, the trust fund will withhold as if it were so engaged in
order to protect the trust fund from possible adverse consequences of a failure
to withhold. The trust fund expects to withhold on the portion of its taxable
income, as calculated for this purpose which may exceed the distributions to
certificateholders, that is allocable to foreign certificateholders pursuant to
Section 1446 of the Code, as if such income were effectively connected to a U.S.
trade or

                                      116


business, at the applicable rate for their domestic U.S. counterparts in the
case of corporate and noncorporate foreign holders. Subsequent adoption of
Treasury regulations or the issuance of other administrative pronouncements may
require the trust fund to change its withholding procedures. In determining a
holder's withholding status, the trust fund may rely on IRS Form W-8 BEN, IRS
Form W-9 or the holder's certification of nonforeign status signed under
penalties of perjury. Any foreclosure property owned by the trust fund could be
treated as a U.S. real property interest owned by certificateholders and subject
to withholding under section 1445 of the Code.

     The term "U.S. Person" means a citizen or resident of the United States, a
corporation, partnership or (other entity treated as a corporation or
partnership) created or organized in or under the laws of the United States or
any state thereof including the District of Columbia (other than a partnership
that is not treated as a United States person under any applicable Treasury
regulations), or an estate whose income is subject to U.S. federal income tax
regardless of its source of income, or a trust if a court within the United
States is able to exercise primary supervision of the administration of the
trust and one or more United States persons have the authority to control all
substantial decisions of the trust. Notwithstanding the preceding sentence, to
the extent provided in regulations, certain trusts in existence on August 20,
1996 and treated as United States persons prior to such date that elect to
continue to be so treated also shall be considered U.S. Persons.

     Each foreign holder may be required to file a U.S. income tax return
(including, in the case of a corporation, the branch profits tax) on its share
of the trust fund's income. Each foreign holder must obtain a taxpayer
identification number from the IRS and submit that number to the trust fund on
Form W-8 ECI in order to assure appropriate crediting of the taxes withheld. A
foreign holder generally would be entitled to file with the IRS a claim for
refund with respect to taxes withheld by the trust fund taking the position that
no taxes were due because the trust fund was not engaged in a U.S. trade or
business. However, interest payments made (or accrued) to a foreign
certificateholder generally will be considered guaranteed payments to the extent
such payments are determined without regard to the income of the trust fund.
"Guaranteed payments" will not be considered "portfolio interest", and,
therefore, may be subject to withholding tax (unless reduced or eliminated
pursuant to an applicable treaty). In such case, a foreign holder would only be
entitled to claim a refund for that portion of the taxes in excess of the taxes
that should be withheld with respect to the guaranteed payments.

     Backup Withholding. Unless the holder is an exempt recipient, distributions
made on the certificates and proceeds from the sale of the certificates will be
subject to a "backup" withholding tax if, in general, the certificateholder
fails to comply with certain identification procedures.

                            STATE TAX CONSIDERATIONS

     In addition to the federal income tax consequences described in "Federal
Income Tax Consequences," potential investors should consider the state and
local tax consequences of the acquisition, ownership, and disposition of the
securities. State and local 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 an investment in the securities.


                                      117


                              ERISA CONSIDERATIONS

     ERISA imposes requirements on employee benefit plans (and on certain other
retirement plans and arrangements, including individual retirement accounts and
annuities, Keogh plans and collective investment funds and separate accounts in
which such plans, accounts or arrangements are invested) (collectively "Plans")
subject to ERISA and on persons who are fiduciaries with respect to such Plans.
Generally, ERISA applies to investments made by Plans. Among other things, ERISA
requires that the assets of a Plan be held in trust and that the trustee, or
other duly authorized fiduciary, have exclusive authority and discretion to
manage and control the assets of the Plan. ERISA also imposes certain duties on
persons who are fiduciaries of Plans. Under ERISA, any person who exercises any
authority or control respecting the management or disposition of the assets of a
Plan is considered to be a fiduciary of such Plan (subject to certain exceptions
not here relevant). Certain employee benefit plans, such as governmental plans
(as defined in ERISA Section 3(32)) and, if no election has been made under
Section 410(d) of the Code, church plans (as defined in ERISA Section 3(33)),
are not subject to ERISA requirements. Accordingly, assets of such plans may be
invested in securities without regard to the ERISA considerations described
above and below, subject to the provisions of applicable state law. Any such
plan which is qualified and exempt from taxation under Code Sections 401(a) and
501(a), however, is subject to the prohibited transaction rules set forth in
Code Section 503.

     On November 13, 1986, the United States Department of Labor (the "DOL")
issued final regulations concerning the definition of what constitutes the
assets of a Plan. (DOL Reg. Section 2510.3-101) Under this regulation (the "Plan
Assets Regulation"), the underlying assets and properties of corporations,
partnerships, trusts and certain other entities in which a Plan makes an
"equity" investment could be deemed for purposes of ERISA to be assets of the
investing Plan in certain circumstances. However, the regulation provides that,
generally, the assets of a corporation or partnership in which a Plan invests
will not be deemed for purposes of ERISA to be assets of such Plan if the equity
interest acquired by the investing Plan is a publicly-offered security. A
publicly-offered security, as defined in the Plan Assets Regulation, is a
security that is widely held, freely transferable and registered under the
Securities Exchange Act of 1934, as amended.

     Under the Plan Assets Regulation, the term "equity interest" is defined as
any interest in an entity other than an instrument that is treated as
indebtedness under applicable local law and has no "substantial equity
features." If securities are not treated as equity interests in the issuer for
purposes of the Plan Assets Regulation, a Plan's investment in the securities
would not cause the assets of the issuer to be deemed plan assets. If the
securities are deemed to be equity interests in the issuer, the issuer could be
considered to hold plan assets because of a Plan's investment in those
securities. In that event, the master servicer and other persons exercising
management or discretionary control over the assets of the issuer or providing
services with respect to those assets, could be deemed to be fiduciaries with
respect to investing Plans and thus subject to the fiduciary responsibility
provisions of Title I of ERISA, including the prohibited transaction provisions
of section 406 of ERISA and section 4975 of the Code, with respect to
transactions involving the issuer's assets. The prospectus supplement with
respect to a series of securities will indicate the expected treatment of that
series under the Plan Assets Regulation.

     In addition to the imposition of general fiduciary standards of investment
prudence and diversification, ERISA prohibits a broad range of transactions
involving plan assets and persons ("Parties in Interest") having certain
specified relationships to a Plan and imposes additional

                                      118


prohibitions where Parties in Interest are fiduciaries with respect to such
Plan. Because the Loans may be deemed plan assets of each Plan that purchases
equity securities, an investment in the equity securities by a Plan might result
in a prohibited transaction under ERISA Sections 406 and 407 and that is subject
to an excise tax under Code Section 4975 unless a statutory, regulatory or
administrative exemption applies.

     Without regard to whether securities are considered to be equity interest
in the issuer, certain affiliates of the issuer might be considered or might
become Parties in Interest with respect to a Plan. In this case, the acquisition
or holding of the securities by or on behalf of the Plan could constitute or
give rise to a prohibited transaction, within the meaning of ERISA and the Code,
unless they were subject to one or more exemptions. Depending on the relevant
facts and circumstances, certain prohibited transaction exemptions may apply to
the purchase or holding of securities--for example, Prohibited Transaction Class
Exemption ("PTCE") 96-23, which exempts certain transactions effected on behalf
of a Plan by an "in-house asset manager"; PTCE 95-60, which exempts certain
transactions by insurance company general accounts; PTCE 91-38, which exempts
certain transactions by bank collective investment funds; PTCE 90-1, which
exempts certain transactions by insurance company pooled separate accounts; or
PTCE 84-14, which exempts certain transactions effected on behalf of a Plan by a
"qualified professional asset manager." There can be no assurance that any of
these exemptions will apply with respect to any Plan's investment in securities,
or that such an exemption, if it did apply, would apply to all prohibited
transactions that may occur in connection with such investment. Furthermore,
these exemptions would not apply to transactions involved in operation of the
trust if, as described above, the assets of the trust were considered to include
Plan assets.

     The DOL has granted to certain underwriters individual administrative
exemptions (the "Underwriter Exemptions") from certain of the prohibited
transaction rules of ERISA and the related excise tax provisions of Section 4975
of the Code with respect to the initial purchase, the holding and the subsequent
resale by Plans of securities, including certificates, issued by pass-through
entities, including trusts, that consist of certain receivables, loans and other
obligations that meet the conditions and requirements of the Underwriter
Exemptions and underwritten or placed by that underwriter or underwritten by a
syndicate managed or co-managed by the underwriter.

     Although each Underwriter Exemption is an individual exemption separately
granted to a specific underwriter, the terms and conditions which generally
apply to the Underwriter Exemptions are substantially identical, and include the
following:

     (1) the acquisition of the securities by a Plan is on terms (including the
         price for the securities) 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 interest evidenced by the securities acquired by the
         Plan are not subordinated to the rights and interests evidenced by
         other securities issued by the entity unless the investment pool
         contains certain types of collateral, such as fully-secured mortgages
         on real property (a "Designated Transaction");

     (3) the securities acquired by the Plan have received a rating at the time
         of such acquisition that is one of the three highest generic rating
         categories (four, if in a Designated Transaction) from Standard &
         Poor's, a Division of The McGraw-Hill Companies

                                      119


         ("S&P"), Moody's Investors Service, Inc. ("Moody's"), or Fitch, Inc.
         ("Fitch") (each, a "rating agency");

     (4) the trustee is not an affiliate of any other member of the Restricted
         Group, as defined below, other than an underwriter;

     (5) the sum of all payments made to and retained by the underwriters in
         connection with the distribution of the securities represents not more
         than reasonable compensation for underwriting the securities; the sum
         of all payments made to and retained by the seller 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 servicer and any other servicer represents not more
         than reasonable compensation for such person's services under the
         agreement pursuant to which the loans are pooled and reimbursements of
         such person's reasonable expenses in connection therewith; and

     (6) the Plan investing in the securities 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 as amended.

     (7) for certain types of issuers, the documents establishing the issuer and
         governing the transaction must contain certain provisions intended to
         protect the assets of the issuer from creditors of the sponsor.

     If an issuer holds obligations that have high loan-to-value ratios, the
Underwriter Exemption may apply to the issuer's non-subordinated securities
rated in one of the two highest generic rating categories by at least one of the
rating agencies if the obligations are residential or home equity loans, and the
fair market value of the collateral on the closing date is at least 80% of the
sum of the outstanding principal balance of the obligation held in the
investment pool and the outstanding principal balance of any obligation of
higher priority secured by the same collateral.

     The Underwriter Exemption extends exemptive relief to certain
mortgage-backed and asset-backed securities transactions involving trusts that
contain swaps, provided the swap satisfies certain requirements and the other
requirements of the Underwriter Exemptions are met. Among other requirements,
the counterparty to the swap must maintain ratings at certain levels from
exemption rating agencies, and the documentation for the swap must provide for
certain remedies if the rating declines. The swap must be an interest rate swap
denominated in U.S. dollars, may not be leveraged, and must satisfy several
other criteria. Certificates of any class affected by the swap may be sold to
plan investors only if they are "qualified plan investors" that satisfy several
requirements relating to their ability to understand the terms of the swap and
the effects of the swap on the risks associated with an investment in the
certificate.

     The trust fund must also meet the following requirements:

     (i)    the corpus of the investment pool must consist solely of assets of
            the type that have been included in other investment pools;

     (ii)   securities in such other investment pools must have been rated in
            one of the three highest rating categories, (four in a Designated
            Transaction) of S&P, Moody's, or Fitch for at least one year prior
            to the Plan's acquisition of securities; and

                                      120


     (iii)  securities evidencing interests in such other investment pools must
            have been purchased by investors other than Plans for at least one
            year prior to any Plan's acquisition of securities.

     Moreover, the Underwriter Exemptions generally provide relief from certain
self-dealing/conflict of interest prohibited transactions that may occur when
the Plan fiduciary causes a Plan to acquire securities in a entity holding
receivables on which the fiduciary (or its affiliate) is an obligor, provided
that, among other requirements: (i) in the case of an acquisition in connection
with the initial issuance of securities, at least fifty percent (50%) of each
class of securities in which Plans have invested is acquired by persons
independent of the Restricted Group, (ii) such fiduciary (or its affiliate) is
an obligor with respect to five percent (5%) or less of the fair market value of
the obligations contained in the trust; (iii) the Plan's investment in
securities of any class does not exceed twenty-five percent (25%) of all of the
securities of that class outstanding at the time of the acquisition; and (iv)
immediately after the acquisition, no more than twenty-five percent (25%) of the
assets of any Plan with respect to which such person is a fiduciary is invested
in securities representing an interest in one or more entities containing assets
sold or serviced by the same entity. The Underwriter Exemptions do not apply to
Plans sponsored by the Seller, any Underwriter, the Trustee, the Master
Servicer, any insurer with respect to the Loans, any obligor with respect to
Loans included in the investment pool constituting more than five percent (5%)
of the aggregate unamortized principal balance of the assets in the trust fund,
any counterparty to an eligible swap held in the trust fund and any affiliate of
such parties (the "Restricted Group").

     The Underwriter Exemption provides exemptive relief to certain
mortgage-backed and asset-backed securities transactions using pre-funding
accounts for entities issuing pass-through securities. Mortgage loans or other
secured receivables supporting payments to security-holders, and having a value
equal to no more than twenty-five percent (25%) of the total principal amount of
the securities being offered by the entity, may transferred to the entity 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 certain
conditions are met.

     The rating of a security may change. If a security no longer has a rating
of at least BBB- from at least one rating agency, it will no longer be eligible
for relief under the Underwriter Exemption (although a Plan that had acquired
the security when it has an investment-grade rating would not be required by the
Underwriter Exemption to dispose of it).

     The Prospectus Supplement for each series of securities will indicate the
classes of securities, if any, offered thereby as to which it is expected that
an Underwriter Exemption will apply.

     Any Plan fiduciary which proposes to cause a Plan to purchase securities
should consult with its counsel concerning the impact of ERISA and the Code, the
applicability of the Underwriter Exemption, and the potential consequences in
their specific circumstances, prior to making such investment. Moreover, each
Plan fiduciary should determine whether under the general fiduciary standards of
investment prudence and diversification an investment in the securities is
appropriate for the Plan, taking into account the overall investment policy of
the Plan and the composition of the Plan's investment portfolio.


                                      121


                                LEGAL INVESTMENT


     The prospectus supplement for each series of securities will specify which,
if any, of the classes of securities offered by it will constitute "mortgage
related securities" for purposes of the Secondary Mortgage Market Enhancement
Act of 1984 ("SMMEA"). Classes of securities that qualify as "mortgage related
securities" will be legal investments for those investors 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 constitute legal investments for them. Those investors are
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).
Under SMMEA, if a state enacted legislation before October 4, 1991 specifically
limiting the legal investment authority of those entities with respect to
"mortgage related securities," the securities will constitute legal investments
for entities subject to the legislation only to the extent provided in the
legislation. Approximately twenty-one states adopted limiting legislation before
the October 4, 1991 deadline. SMMEA provides, however, that the enactment of
limiting legislation will not affect the validity of any contractual commitment
to purchase, hold or invest in securities, or require the sale or other
disposition of securities, as long as the contractual commitment was made or the
securities were acquired before the enactment of that legislation.

     SMMEA also amended the legal investment authority of federally-chartered
depository institutions as follows: federal savings and loan associations and
federal savings banks may invest in, sell or otherwise deal in securities
without limitations as to the percentage of their assets represented by the
securities, federal credit unions may invest in mortgage related securities, and
national banks may purchase securities 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 regulations that the applicable
federal authority may prescribe. In this connection, federal credit unions
should review the National Credit Union Administration 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 its regulation "Investment and Deposit
Activities" (12 C.F.R. Part 703), (whether or not the class of securities under
consideration for purchase constitutes a "mortgage related security"). The NCUA
issued final regulations effective December 2, 1991 that restrict or prohibit
the investment by federal credit unions in certain types of mortgage related
securities.

     All depository institutions considering an investment in the securities
(whether or not the class of securities under consideration for purchase
constitutes a "mortgage related security") should review the Federal Financial
Institutions Examination Council's Supervisory Policy Statement on the
Securities Activities (to the extent adopted by their respective regulators),
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, "high-risk
mortgage securities" include securities such as securities not entitled to
distributions allocated to principal or interest, or subordinated securities.
Under the policy statement, each depository institution must determine, before
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 that product would be consistent with the policy statement.

                                      122


     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 "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 securities or to purchase
securities representing more than a specified percentage of the investor's
assets. Investors are encouraged to consult their own legal advisors in
determining whether and to what extent the securities constitute legal
investments for them.


                             METHOD OF DISTRIBUTION


     Securities are being offered hereby in series from time to time (each
series evidencing a separate trust fund) through any of the following methods:

     o   by negotiated firm commitment underwriting and public reoffering by
         underwriters;

     o   by agency placements through one or more placement agents primarily
         with institutional investors and dealers; and

     o   by placement directly by the depositor with institutional investors.

     A prospectus supplement will be prepared for each series describing the
offering method and listing the underwriters for that series. Each prospectus
supplement will include either:

     o   the price at which the series is being offered, the nature and amount
         of any underwriting discounts or additional compensation to the
         underwriters and the proceeds of the offering to the depositor, or

     o   the method of determining the price at which the underwriters will sell
         the securities.

     Each prospectus supplement for an underwritten offering will also describe
the underwriters' obligations, any material relationship between the depositor
and any underwriter and, if applicable, any discounts or concessions to be
allowed or reallowed to dealers or others and any arrangements to stabilize the
market for the offered securities. In firm commitment underwritten offerings,
the underwriters will be obligated to purchase all of the securities of the
series if any securities are purchased. The underwriters may acquire securities
for their own accounts and may resell them 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.

     Underwriters and agents may be entitled under agreements entered into with
the depositor to indemnification by the depositor against certain civil
liabilities, including liabilities under the Securities Act of 1933, as amended,
or to contribution with respect to payments that the underwriters or agents may
have to make in respect of those liabilities.

     If a series is offered other than through underwriters, the related
prospectus supplement will describe the offering and any agreements to be
entered into between the depositor and purchasers of securities of the series.

                                      123


                                  LEGAL MATTERS

     The validity of the securities, including certain federal income tax
consequences with respect to the securities, will be passed upon for the
depositor by Sidley Austin Brown & Wood LLP, 787 Seventh Avenue, New York, New
York 10019.

                              FINANCIAL INFORMATION

     A new trust fund will be formed for each series of securities. No trust
fund will engage in any business activities or have any assets or obligations
before the issuance of the related series of securities. Accordingly, no
financial statements for any trust fund will be included in this prospectus or
in the related prospectus supplement.

                                     RATING

     It is a condition to the issuance of the securities of each series offered
by this prospectus and by the related prospectus supplement that they shall have
been rated in one of the four highest rating categories by the nationally
recognized statistical rating agency or agencies specified in the related
prospectus supplement.

     A security rating is based on the adequacy of the value of the related
trust assets and any credit enhancement for that class, and reflects the rating
agency's assessment of how likely it is that holders of the class of securities
will receive the payments to which they are entitled. A rating is not an
assessment of how likely it is that principal prepayments on the underlying
loans will be made, the degree to which the rate of prepayments might differ
from that originally anticipated or how likely it is that the securities of a
series will be redeemed early.

     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 assigning rating
organization. Each security rating should be evaluated independently of any
other security rating.




                                      124



                            INDEX OF PRINCIPAL TERMS



                                                      PAGE
                                                      ----
APR............................................        28
Asset Conservation Act.........................        73
BIF............................................        57
Capitalized Interest Account...................        59
Cash Flow Bond Method..........................        97
CERCLA.........................................        72
Class Security Balance.........................        36
Code...........................................        35
Credit Enhancement.............................        35
DOL............................................       104
DTC............................................        45
Eleventh District..............................        43
Eligible Corporations..........................        93
ERISA..........................................        35
FDIC...........................................        32
FHA............................................        25
FHLBSF.........................................        43
FHLMC..........................................        32
Fitch..........................................       107
FNMA...........................................        32
Interest Weighted Securities...................        86
IO.............................................        93
Loan Rate......................................        26
Morgan.........................................        47
National Cost of Funds Index...................        44
New Arrangement................................        94
Nonresidents...................................        99
OID............................................        83
OID Regulations................................        83
OTS............................................        44
Parties in Interest............................       105
Pass-Through Securities........................        95
Pay-Through Security...........................        85
Plans..........................................       104
Prepayment Assumption..........................        85
Property Improvement Loans.....................        79
PTCE...........................................       105
Purchase Price.................................        33
Ratio Strip Securities.........................        97
RCRA...........................................        73
Relief Act.....................................        77
Residual Interest Security.....................        89
Restricted Group...............................       108
S&P............................................       107
SAIF...........................................        57
Security Account...............................        56
Servicing Fee..................................        96
Single Family Properties.......................        27
Single Family Securities.......................       105
SMMEA..........................................       108
Stripped Securities............................        96
TIN............................................        98
Title I Loans..................................        79
Title I Program................................        79
Title V........................................        75
Trust Fund Assets..............................        24
UCC............................................        72
Underwriter Exemptions.........................       106
VA.............................................        25
VA Guaranty....................................        63

                                      125

                                     PART II
                     INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION*

The following table sets forth the estimated expenses in connection with the
issuance and distribution of the Securities being registered under this
Registration Statement, other than underwriting discounts and commissions:

         SEC registration fee..................................      $380,100**
         Printing and engraving expenses.......................      $ 25,000
         Legal fees and expenses...............................      $150,000
         Trustee fees and expenses.............................      $ 20,000
         Accounting fees and expenses..........................      $ 30,000
         Blue Sky fees and expenses............................      $  5,000
         Rating agency fees....................................      $200,000
         Miscellaneous.........................................      $  5,000
                                                                    ---------
        Total.................................................       $815,100
                                                                     =========

--------------------------------
*        All amounts except the SEC registration fee are estimates of aggregate
         expenses incurred or to be incurred in connection with the issuance and
         distribution of a Series of Securities in an aggregate principal amount
         assumed for these purposes to be equal to $200,000,000 of Securities
         registered by this Registration Statement.

**       This amount relates to the $3,000,000,000 of additional Securities
         registered hereby. The remaining $11,933.42 of the filing fee relates
         to registration statement No. 333-47158, and the registration fee with
         respect thereto has been previously paid.

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

         The Registrant's Certificate of Incorporation provides for
indemnification of directors and officers of the Registrant to the full extent
permitted by Delaware law.

         Section 145 of the Delaware General Corporation Law provides, in
substance, that Delaware corporations shall have the power, under specified
circumstances, to identify their directors, officers, employees and agents in
connection with actions, suits or proceedings brought against them by a third
party or in the right of the corporation, 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 Delaware General Corporation Law
also provides that the Registrant may purchase insurance on behalf of any such
director, officer, employee or agent.





ITEM 16. EXHIBITS.

*1.1     -- Form of Underwriting Agreement
*1.2     -- Form of Indemnification and Contribution Agreement
*3.1     -- Certificate of Incorporation of the Registrant
*3.2     -- By-laws of the Registrant
*4.1     -- Form of Pooling and Servicing Agreement relating to Revolving Home
            Equity Loan Asset Backed Certificates
*4.2     -- Form of Sale and Servicing Agreement relating to Revolving Home
            Equity Loan Asset Backed Notes
*4.3     -- Form of Pooling and Servicing Agreement relating to Home Equity
            Mortgage Loan Asset Backed Certificates
*4.4     -- Form of Trust Agreement
*4.5     -- Form of Indenture
*4.6     -- Form of Master Servicing Agreement
 5.1(a)  -- Opinion of Sidley Austin Brown & Wood LLP as to legality of the
            Securities
 5.1(b)  -- Opinion of Richards, Layton & Finger as to the legality
            of the Securities
 8.1     -- Opinion of Sidley Austin Brown & Wood LLP as to certain tax matters
           (included in Exhibit 5.1(a))
*10.1    -- Form of Loan Purchase Agreement
23.1(a)  -- Consent of Sidley Austin Brown & Wood LLP (included in Exhibits
            5.1(a) and 8.1 hereof)
23.1(b)  -- Consent of Richards, Layton & Finger (included in Exhibit 5.1(b)
            hereof)
24.1     -- Power of Attorney (included on Page II-4)
25.1     -- Statement of Eligibility of Trustee

-------------------------------
*Filed as an exhibit to Registration Statement No. 333-47158 and incorporated
 herein by reference.

ITEM 17. UNDERTAKINGS.

         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,

                           (i)      to include any prospectus required by
                  Section 10(a)(3) of the Securities Act of 1933, as amended;

                           (ii) to reflect in the prospectus any facts or events
                  arising after the effective date of this Registration
                  Statement (or the most recent post-effective amendment hereof)
                  which, individually or in the aggregate, represent a
                  fundamental change in the information set forth in this
                  Registration Statement. Notwithstanding the foregoing, any
                  increase or decrease in volume of securities offered (if the
                  total dollar value of securities offered would not exceed that
                  which was registered) and any deviation from the low or high
                  and of the estimated maximum offering range may be reflected
                  in the form of prospectus filed with the Commission pursuant
                  to Rule 424(b) if, in the aggregate, the changes in volume and
                  price represent no more than 20 percent change in the maximum
                  aggregate offering price set forth in the "Calculation of
                  Registration Fee" table in the effective Registration
                  Statement; and

                           (iii) to include any material information with
                  respect to the plan of distribution not previously disclosed
                  in this Registration Statement or any material change to such
                  information in this Registration Statement;

provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the Registrant pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in this Registration
Statement,

                                          2




                  (2) that, for the purpose of determining any liability under
         the Securities Act of 1933, as amended, 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, and

                  (3) To remove from registration by means of a post-effective
         amendment any of the securities being registered that remain unsold at
         the termination of the offering.

         The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, as amended, each
filing of a Trust Fund's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934, as amended, that is incorporated
by reference in this 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.

         The undersigned registrant hereby undertakes to provide to the
underwriter at the closing specified in the underwriting agreements,
certificates in such denominations and registered in such names as required by
the underwriter to permit prompt delivery to each purchaser.

         Insofar as indemnification for liabilities arising under the Securities
Act of 1933, as amended, 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 Securities Act of 1933, as amended, 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
Securities Act of 1933, as amended, and will be governed by the final
adjudication of such issue.

         The undersigned Registrant hereby undertakes to file an application for
the purpose of determining the eligibility of the trustee to act under
subsection (a) of Section 310 of the Trust Indenture Act of 1939 in accordance
with the rules and regulations prescribed by the Commission under Section
305(b)(2) of the Trust Indenture Act of 1939.

                                     3




                                   SIGNATURES

         Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that (i) it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and (ii) it reasonably
believes that the security rating requirement of Transaction Requirement B.5 of
Form S-3 will be met by the time of sale of each Series of Securities to which
this Registration Statement relates and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the city of Pasadena, state of California on the 7th day of
September, 2004.

                                                 IndyMac ABS, Inc.

                                                 By  /s/ S. Blair Abernathy
                                                     ---------------------------

                                                 Name:  S. Blair Abernathy
                                                 Title: Chairman of the Board,
                                                 President and Director


                                POWER OF ATTORNEY

         KNOWN ALL MEN BY THESE PRESENTS, that each person whose signature
appears below, constitutes and appoints each of S. Blair Abernathy, John Olinski
and Samir Grover or any of them, his true and lawful attorneys-in-fact and
agents, with full power of substitution and resubstitution, for him and his
name, place and stead, in any and all capacitites, to sign any and all
amendments (including post-effective amendments) to this Registration Statement,
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, and each of them, full power and authority to
do and peform 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 he might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their or his other substitutes,
may lawfully do or cause to be done by virtue thereof.

         Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.




                  SIGNATURE                                     TITLE                              DATE
                  ---------                                     -----                              ----


           /s/ S. Blair Abernathy               Chairman of the Board, Chief               September 7, 2004
        -------------------------------         Executive Officer and Director
               S. Blair Abernathy               (Principal Executive Officer)

             /s/ John Olinski                   Executive Vice President                   September 7, 2004
        -------------------------------         and Director
                 John Olinski

             /s/ Samir Grover                   Senior Vice President, Chief               September 7, 2004
        -------------------------------         Financial Officer, Principal
                 Samir Grover                   Accounting Officer


                                           4



                                  EXHIBIT INDEX



  EXHIBIT
SEQUENTIAL
    NO.                    DESCRIPTION OF EXHIBIT                                              PAGE NUMBER
---------                  --------------------                                               ------------

         *1.1     --       Form of Underwriting Agreement.................................................
         *1.2     --       Form of Indemnification and Contribution Agreement.............................
         *3.1     --       Certificate of Incorporation of the Registrant.................................
         *3.2     --       By-laws of the Registrant......................................................
         *4.1     --       Form of Pooling and Servicing Agreement relating to Revolving Home Equity
                           Loan Asset Backed Certificates.................................................
         *4.2     --       Form of Sale and Servicing Agreement relating to Revolving Home Equity
                           Loan Asset Backed Notes........................................................
         *4.3     --       Form of Pooling and Servicing Agreement relating to Home Equity Mortgage
                           Loan Asset Backed Certificates.................................................
         *4.4     --       Form of Trust Agreement........................................................
         *4.5     --       Form of Indenture..............................................................
         *4.6     --       Form of Master Servicing Agreement.............................................
         5.1(a)   --       Opinion of Sidley Austin Brown & Wood LLP as to legality of the Securities.....
         5.1(b)   --       Opinion of Richards, Layton & Finger as to legality of the Securities..........
         8.1      --       Opinion of Sidley Austin Brown & Wood LLP as to certain tax matters
                           (included in Exhibit 5.1(a))...................................................
         *10.1    --       Form of Loan Purchase Agreement................................................
         23.1(a)  --       Consent of Sidley Austin Brown & Wood LLP (included in Exhibits 5.1(a) and 8.1)
         23.1(b)  --       Consent of Richards, Layton & Finger (included in Exhibits 5.1(b) hereof)......


---------------------------------------
* Filed as an exhibit to Registration Statement No. 333-47158 and
  incorporated herein by reference.



                                         5