Filed Pursuant to Rule 424(b)(5)
                                               Registration File No.: 333-115858


PROSPECTUS SUPPLEMENT
(To Prospectus dated November 19, 2004)


                           $321,053,100 (APPROXIMATE)


                     STRUCTURED ASSET SECURITIES CORPORATION
               MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2004-22

                     [AURORA LOAN SERVICES INC LOGO OMITTED]




                            AURORA LOAN SERVICES INC.
                                 MASTER SERVICER
                                ----------------

     CONSIDER CAREFULLY THE RISK FACTORS BEGINNING ON PAGE S-8 OF THIS
PROSPECTUS SUPPLEMENT.

     For a list of capitalized terms used in this prospectus supplement and the
prospectus, see the index of principal terms beginning on page S-62 in this
prospectus supplement and the index of defined terms on page 118 in the
prospectus.

     The certificates will represent interests in the trust fund only and will
not represent interests in or obligations of any other entity.

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


----------------------------

The trust will issue:

o    FIVE CLASSES OF SENIOR CERTIFICATES, INCLUDING ONE CLASS OF INTEREST-ONLY
     CERTIFICATES.

o    SIX CLASSES OF SUBORDINATE CERTIFICATES.

o    TWO ADDITIONAL CLASSES OF CERTIFICATES.

     The certificates represent ownership interests in a trust fund that
consists primarily of a pool of fixed rate mortgage loans.

     The classes of certificates offered by this prospectus supplement are
listed, together with their initial class principal amounts (or class notional
amounts) and interest rates, under "Summary of Terms - The Offered Certificates"
beginning on page S-2 of this prospectus supplement. This prospectus supplement
and the accompanying prospectus relate only to the offering of the certificates
listed in the table on page S-2 and not to the other classes of certificates
that will be issued by the trust fund as described in this prospectus
supplement.

     NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THE CERTIFICATES OR DETERMINED THAT THIS
PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING PROSPECTUS IS ACCURATE OR COMPLETE.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

     The certificates offered by this prospectus supplement will be purchased
by Lehman Brothers Inc., as the underwriter, from Structured Asset Securities
Corporation, and are being offered by Lehman Brothers Inc. from time to time
for sale to the public in negotiated transactions or otherwise at varying
prices to be determined at the time of sale. The underwriter has the right to
reject any order. Proceeds to Structured Asset Securities Corporation from the
sale of these certificates will be approximately 100.00% of their initial total
principal amount, plus accrued interest, before deducting expenses.

     On or about December 15, 2004, delivery of the certificates offered by
this prospectus supplement, except the Class R Certificate, will be made
through the book-entry facilities of The Depository Trust Company, Clearstream
Banking Luxembourg and the Euroclear System, and delivery of the Class R
Certificate will be made in physical form at the offices of Lehman Brothers
Inc., New York, New York.


                                 Underwriter:



                                LEHMAN BROTHERS


          The date of this prospectus supplement is December 13, 2004.

             IMPORTANT NOTICE ABOUT INFORMATION PRESENTED IN THIS
            PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS:


     We provide information to you about the certificates offered by this
prospectus supplement in two separate documents that progressively provide more
detail: (1) the accompanying prospectus, which provides general information,
some of which may not apply to your certificates and (2) this prospectus
supplement, which describes the specific terms of your certificates.


     IF INFORMATION VARIES BETWEEN THIS PROSPECTUS SUPPLEMENT AND THE
ACCOMPANYING PROSPECTUS, YOU SHOULD RELY ON THE INFORMATION IN THIS PROSPECTUS
SUPPLEMENT.


     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 certificates in any state where the offer is not
permitted. We do not claim that the information in this prospectus supplement
and prospectus is accurate as of any date other than the dates stated on their
respective covers.

                               ----------------

     After the initial distribution of the certificates offered by this
prospectus supplement, this prospectus and prospectus supplement may be used by
Lehman Brothers Inc., an affiliate of the master servicer and one of the
servicers, in connection with market making transactions in those certificates.
Lehman Brothers Inc. may act as principal or agent in these transactions. These
transactions will be at market prices at the time of sale and not at the prices
of the initial offering. Certain information in this prospectus supplement will
be updated from time to time for as long as Aurora Loan Services Inc. continues
to be the master servicer or a servicer of mortgage loans included in the trust
fund.

                               ----------------

     Dealers will deliver a prospectus supplement and prospectus when acting as
underwriters of the certificates and with respect to their unsold allotments or
subscriptions. In addition, all dealers selling the certificates will be
required to deliver a prospectus supplement and prospectus for ninety days
following the date of this prospectus supplement.

                               ----------------

     We include cross-references in this prospectus supplement and the
accompanying prospectus to captions in these materials where you can find
further related discussions. The following tables of contents provide the pages
on which these captions are located.


                                      S-ii


                              TABLES OF CONTENTS


                             PROSPECTUS SUPPLEMENT






                                                    PAGE
                                                   -----

 Summary of Terms ..............................   S-1
    Parties ....................................   S-1
    The Offered Certificates ...................   S-2
    Accelerated Principal Payments .............   S-5
    The Mortgage Loans .........................   S-5
    Servicing of the Mortgage Loans ............   S-5
    Optional Purchase of the Mortgage
       Loans ...................................   S-6
    Financing ..................................   S-6
    Tax Status .................................   S-6
    ERISA Considerations .......................   S-6
    Legal Investment Considerations ............   S-6
    Ratings of the Certificates ................   S-7
 Risk Factors ..................................   S-8
 Description of the Certificates ...............   S-14
    General ....................................   S-14
    Book-Entry Registration ....................   S-15
    Priority of Distributions ..................   S-19
    Class P Certificates .......................   S-20
    Class E Certificates .......................   S-20
    Distributions of Interest ..................   S-20
    Class A2 Auction ...........................   S-23
    Distributions of Principal .................   S-24
    Available Distribution Amount ..............   S-26
    Example of Distributions ...................   S-28
    The Residual Certificate ...................   S-29
    Allocation of Realized Losses ..............   S-29
    Final Scheduled Distribution Date ..........   S-30
    Optional Termination of the Trust
       Fund ....................................   S-31
    The Trustee ................................   S-31
 Description of the Mortgage Pool ..............   S-32
    General ....................................   S-32
    The Mortgage Loans .........................   S-33
 Underwriting Guidelines .......................   S-37
    Aurora Underwriting Guidelines .............   S-37
    General Underwriting Guidelines ............   S-38
 Additional Information ........................   S-39
 The Master Servicer ...........................   S-39
 The Servicers .................................   S-41
    General ....................................   S-41
 Servicing of the Mortgage Loans ...............   S-41





                                                    PAGE
                                                   -----

    General ....................................   S-41
    Servicing Compensation and Payment
       of Expenses .............................   S-41
    Prepayment Interest Shortfalls .............   S-42
    Advances ...................................   S-42
    Collection of Taxes, Assessments and
       Similar Items ...........................   S-42
    Insurance Coverage .........................   S-43
    Evidence as to Compliance ..................   S-43
 Trust Agreement ...............................   S-43
    General ....................................   S-43
    Assignment of Mortgage Loans ...............   S-43
    Representations and Warranties .............   S-44
    Voting Rights ..............................   S-45
 Yield, Prepayment and Weighted
    Average Life ...............................   S-45
    General ....................................   S-45
    Subordination of the Offered
       Subordinate Certificates ................   S-47
    Sensitivity of Certain Classes of
       Certificates ............................   S-48
    Weighted Average Life ......................   S-49
 Material Federal Income Tax
    Considerations .............................   S-54
    General ....................................   S-54
    Additional Tax Considerations
       Applicable to the Class A2
       Certificates ............................   S-54
    Residual Certificate .......................   S-57
 Tax Return Disclosure Requirements ............   S-58
 Legal Investment Considerations ...............   S-58
 ERISA Considerations ..........................   S-58
 Use of Proceeds ...............................   S-60
 Underwriting ..................................   S-60
 Legal Matters .................................   S-60
 Ratings .......................................   S-60
 Index of Principal Terms ......................   S-62
 ANNEX A: Global Clearance,
    Settlement and Tax Documentation
    Procedures .................................   A-1
 Certain U.S. Federal Income Tax
    Documentation Requirements .................   A-3



                                     S-iii


                                   PROSPECTUS






                                                      PAGE
                                                 -------------

 Description of the Securities ...............          2
    General ..................................          2
    Distributions on the Securities ..........          2
    Optional Termination .....................          4
    Optional Purchase of Securities ..........          5
    Other Purchases ..........................          5
    Book-Entry Registration ..................          5
 Yield, Prepayment and Maturity ..............
    Considerations ...........................         10
    Payment Delays ...........................         10
    Principal Prepayments ....................         10
    Timing of Reduction of
       Principal Amount ......................         10
    Interest or Principal Weighted
       Securities ............................         10
    Final Scheduled Distribution Date ........         11
    Prepayments and Weighted Average
       Life ..................................         11
    Other Factors Affecting Weighted
       Average Life ..........................         12
 The Trust Funds .............................         13
    General ..................................         13
    Ginnie Mae Certificates ..................         15
    Fannie Mae Certificates ..................         17
    Freddie Mac Certificates .................         18
    Private Mortgage-Backed Securities .......         21
    The Mortgage Loans .......................         23
    The Manufactured Home Loans ..............         27
    Pre-Funding Arrangements .................         28
    Collection Account and Distribution
       Account ...............................         29
    Other Funds or Accounts ..................         29
 Loan Underwriting Procedures
    and Standards ............................         30
    Underwriting Standards ...................         30
    Loss Experience ..........................         31
    Representations and Warranties ...........         32
    Substitution of Primary Assets ...........         34
 Servicing of Loans ..........................         34
    General ..................................         34
    Collection Procedures; Escrow
       Accounts ..............................         35
    Deposits to and Withdrawals from
       the Collection Account ................         35





                                                      PAGE
                                                 -------------

    Servicing Accounts .......................         37
    Buy-Down Loans, GPM Loans and
       Other Subsidized Loans ................         37
    Advances and Other Payments, and
       Limitations Thereon ...................         38
    Maintenance of Insurance Policies
       and Other Servicing Procedures ........         39
    Presentation of Claims; Realization
       Upon Defaulted Loans ..................         41
    Enforcement of Due-On-Sale Clauses........         42
    Certain Rights Related to
       Foreclosure ...........................         43
    Servicing Compensation and Payment
       of Expenses ...........................         43
    Evidence as to Compliance ................         44
    Certain Matters Regarding the Master
       Servicer ..............................         44
    Certain Risks ............................         45
 Credit Support ..............................         46
    General ..................................         46
    Subordinate Securities; Subordination
       Reserve Fund ..........................         46
    Cross-Support Features ...................         47
    Insurance ................................         47
    Letter of Credit .........................         48
    Financial Guaranty Insurance Policy ......         48
    Reserve Funds ............................         48
 Description of Mortgage and Other
    Insurance ................................         50
    Mortgage Insurance on the Loans ..........         50
    Hazard Insurance on the Loans ............         55
    Bankruptcy Bond ..........................         57
    Repurchase Bond ..........................         57
 The Agreements ..............................         58
    Issuance of Securities ...................         58
    Assignment of Primary Assets .............         58
    Repurchase and Substitution of
       Non-Conforming Loans ..................         61
    Reports to Securityholders ...............         62
    Investment of Funds ......................         63
    Event of Default; Rights Upon Event
       of Default ............................         63



                                      S-iv







                                                    PAGE
                                                   ------

    The Trustee ................................     66
    Duties of the Trustee ......................     66
    Resignation of Trustee .....................     66
    Distribution Account .......................     67
    Expense Reserve Fund .......................     67
    Amendment of Agreement .....................     67
    Voting Rights ..............................     68
    REMIC or FASIT Administrator ...............     68
    Administration Agreement ...................     68
    Periodic Reports ...........................     68
    Termination ................................     68
 Legal Aspects of Loans ........................     70
    Mortgages ..................................     70
    Junior Mortgages; Rights of Senior
       Mortgages ...............................     70
    Cooperative Loans ..........................     72
    Foreclosure on Mortgages ...................     73
    Realizing Upon Cooperative Loan
       Security ................................     74
    Rights of Redemption .......................     76
    Anti-Deficiency Legislation and
       Other Limitations on Lenders ............     76
    Servicemembers' Civil Relief Act ...........     78
    Environmental Risks ........................     79
    Due-on-Sale Clauses in Mortgage
       Loans ...................................     79
    Enforceability of Prepayment and
       Late Payment Fees .......................     80
    Equitable Limitations on Remedies ..........     80
    Applicability of Usury Laws ................     81





                                                    PAGE
                                                   ------

    Adjustable Interest Rate Loans .............     81
    Manufactured Home Loans ....................     81
 Material Federal Income Tax
    Considerations .............................     84
    Types of Securities ........................     85
    Taxation of Securities Treated as
       Debt Instruments ........................     88
    REMIC Residual Certificates ................     94
    FASIT Ownership Certificates ...............    100
    Grantor Trust Certificates .................    101
    Partner Certificates .......................    104
    Special Tax Attributes .....................    105
    Backup Withholding .........................    107
 State and Local Tax Considerations ............    108
 ERISA Considerations ..........................    108
    General ....................................    108
    The Underwriter Exemption ..................    109
 Additional Considerations for Securities
    which are Notes ............................    113
 Additional Fiduciary Considerations ...........    113
 Legal Investment Considerations ...............    114
 Legal Matters .................................    114
 The Depositor .................................    115
 Use of Proceeds ...............................    115
 Plan of Distribution ..........................    115
 Additional Information ........................    116
 Incorporation of Certain Documents by
    Reference ..................................    117
 Reports to Securityholders ....................    117
 Index of Defined Terms ........................    118



                                      S-v



                     [THIS PAGE INTENTIONALLY LEFT BLANK.]





                                SUMMARY OF TERMS

 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 THE OFFERING OF THE
   CERTIFICATES, IT IS NECESSARY THAT YOU READ CAREFULLY THIS ENTIRE DOCUMENT
   AND THE ACCOMPANYING PROSPECTUS.


 o WHILE THIS SUMMARY CONTAINS AN OVERVIEW OF CERTAIN CALCULATIONS, CASH FLOW
   PRIORITIES AND OTHER INFORMATION TO AID YOUR UNDERSTANDING, YOU SHOULD READ
   CAREFULLY THE FULL DESCRIPTION OF THESE CALCULATIONS, CASH FLOW PRIORITIES
   AND OTHER INFORMATION IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING
   PROSPECTUS BEFORE MAKING ANY INVESTMENT DECISION.


 o SOME OF THE INFORMATION THAT FOLLOWS CONSISTS OF FORWARD-LOOKING STATEMENTS
   RELATING TO FUTURE ECONOMIC PERFORMANCE OR PROJECTIONS AND OTHER FINANCIAL
   ITEMS. FORWARD-LOOKING STATEMENTS ARE SUBJECT TO A VARIETY OF RISKS AND
   UNCERTAINTIES, SUCH AS GENERAL ECONOMIC AND BUSINESS CONDITIONS AND
   REGULATORY INITIATIVES AND COMPLIANCE, MANY OF WHICH ARE BEYOND THE CONTROL
   OF THE PARTIES PARTICIPATING IN THIS TRANSACTION. ACCORDINGLY, WHAT
   ACTUALLY HAPPENS MAY BE VERY DIFFERENT FROM THE PROJECTIONS INCLUDED
   HEREIN.


 o WHENEVER WE REFER TO A PERCENTAGE OF SOME OR ALL OF THE MORTGAGE LOANS IN
   THE TRUST FUND, THAT PERCENTAGE HAS BEEN CALCULATED ON THE BASIS OF THE
   TOTAL SCHEDULED PRINCIPAL BALANCE OF THOSE MORTGAGE LOANS IN THE TRUST FUND
   AS OF NOVEMBER 1, 2004, UNLESS WE SPECIFY OTHERWISE. WE EXPLAIN IN THIS
   PROSPECTUS SUPPLEMENT UNDER "DESCRIPTION OF THE CERTIFICATES --
   DISTRIBUTIONS OF PRINCIPAL" HOW THE SCHEDULED PRINCIPAL BALANCE OF A
   MORTGAGE LOAN IS DETERMINED. WHENEVER WE REFER IN THIS SUMMARY OF TERMS OR
   IN THE RISK FACTORS SECTION OF THIS PROSPECTUS SUPPLEMENT TO THE TOTAL
   PRINCIPAL BALANCE OF ANY MORTGAGE LOANS, WE MEAN THE TOTAL OF THEIR
   SCHEDULED PRINCIPAL BALANCES, UNLESS WE SPECIFY OTHERWISE.


PARTIES

ORIGINATORS

       Approximately 91.48% of the mortgage loans were originated by Aurora
Loan Services Inc. The remainder of the mortgage loans were originated by
various other banks, savings and loans and other mortgage lending institutions.



SELLER

       Lehman Brothers Holdings Inc. will sell the mortgage loans to the
depositor.


DEPOSITOR

       Structured Asset Securities Corporation, a Delaware special purpose
corporation, will sell the mortgage loans to the Series 2004-22 trust.


MASTER SERVICER

       Aurora Loan Services Inc., an affiliate of the seller, the depositor and
Lehman Brothers Inc., will oversee the servicing of the mortgage loans by the
primary servicers.

SERVICERS

       The mortgage loans initially will be serviced by Aurora Loan Services
Inc., Chase Manhattan Mortgage Corporation, Colonial Savings, F.A., First
National Bank of Nevada and Wachovia Mortgage Corporation. It is expected that
the mortgage loans serviced by First National Bank of Nevada will be serviced
by Aurora beginning on January 2, 2005.

TRUSTEE

       Citibank, N.A. will act as trustee for the trust.

AUCTION ADMINISTRATOR

       The Trustee or its agent shall administer the auction of the Class A2
Certificates.


                                      S-1


                           THE OFFERED CERTIFICATES


CLASSES OF CERTIFICATES


     The Structured Asset Securities Corporation Mortgage Pass-Through
Certificates, Series 2004-22, consist of the classes of certificates listed in
the table below, together with the Class A3, Class B4, Class B5, Class B6,
Class E and Class P Certificates. Only the classes of certificates listed in
the table below are offered by this prospectus supplement.




                       CLASS
                     PRINCIPAL                                         CUSIP
CLASS                AMOUNT(1)        TYPE(2)     INTEREST RATE       NUMBER
-------------   ------------------   ---------   ---------------   ------------

A1 ..........      $62,000,000          SEQ      3.83%(3)          86359B S5 1
A2 ..........      $244,696,000        SEQ/C     4.86%(4)          86359B R3 7
AIO .........                 (5)      NTL/IO    Variable(5)       86359B R4 5
B1 ..........      $11,938,000         SUB/W     Variable(6)       86359B R5 2
B2 ..........      $ 1,613,000         SUB/W     Variable(6)       86359B R6 0
B3 ..........      $   806,000         SUB/W     Variable(6)       86359B R7 8
R ...........      $       100          R/W      Variable(6)       86359B S6 9


----------
(1)   These balances are approximate, as described in this prospectus
      supplement.





 (2)      SEQ      =   Sequential
          W        =   Weighted average interest rate certificate
          NTL/IO   =   Notional interest-only certificate
          SUB      =   Subordinate certificate
          R        =   REMIC residual interest certificate
          C        =   Callable certificate


(3)   The Class A1 Certificates will bear interest based on the interest rate
      specified above.


(4)   The Class A2 Certificates will bear interest based on the interest rate
      specified above through the first auction distribution date subject to
      adjustment as described in this prospectus supplement. Thereafter the
      Class A2 Certificates will bear interest as described in this prospectus
      supplement.


(5)   The Class AIO Certificates will be interest-only certificates; they will
      not be entitled to payments of principal and will accrue interest on
      their notional amount as described in this prospectus supplement. After
      the first auction distribution date (as described herein), the Class AIO
      Certificates will no longer be entitled to receive distributions of any
      kind.


(6)   The Class B1, Class B2, Class B3 and Class R Certificates will accrue
      interest at the Net WAC of the mortgage loans, as described in this
      prospectus supplement.


                                      S-2


       The certificates offered by this prospectus supplement (except for the
Class R Certificate, which will be issued in the form of a physical
certificate) will be issued in book-entry form.

       See "Description of the Certificates -- General" in this prospectus
supplement for a discussion of the minimum denominations and the incremental
denominations of each class of offered certificates.

       The certificates represent ownership interests in a trust fund, the
assets of which will consist primarily of a pool of mortgage loans, which is
sometimes referred to as the "mortgage pool." The mortgage loans are fixed
rate, conventional, fully amortizing, first lien, residential mortgage loans
having original terms to maturity of 30 years.

       On the closing date, the certificates will have an approximate total
initial principal amount of $322,668,769. Any difference between the total
principal amount of the certificates on the date they are issued and the
approximate total principal amount of the certificates as reflected in this
prospectus supplement will not exceed 5%.


DISTRIBUTIONS ON THE CERTIFICATES

       Principal and interest on the certificates will be distributable on the
25th day of each month, beginning in December 2004. However, if the 25th day is
not a business day, distributions will be made on the next business day after
the 25th day of the month.


INTEREST DISTRIBUTIONS

       Interest will accrue on each class of certificates, other than the Class
E and Class P Certificates, at the applicable annual rates described in this
prospectus supplement.

       See "Description of the Certificates -- Distributions of Interest" and
"Yield, Prepayment and Weighted Average Life" in this prospectus supplement.

       The Class AIO Certificates will receive absolutely no distributions of
any kind after the first auction distribution date.

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

PRINCIPAL DISTRIBUTIONS

       The amount of principal distributable to the certificates, other than
the Class AIO, Class E and Class P Certificates, will be determined based on
(1) priorities and formulas that allocate portions of principal payments
received on the mortgage loans among different classes of certificates and (2)
the amount of funds actually received on the mortgage loans that are available
to make payments on the certificates. Funds actually received on the mortgage
loans may consist of expected monthly scheduled payments, unexpected payments
resulting from prepayments or defaults by borrowers, liquidation of defaulted
mortgage loans, or repurchases of mortgage loans under the circumstances
described in this prospectus supplement.

       The key allocation concept for the Class A1, Class A2 and Class R
Certificates is the Senior Principal Distribution Amount. The key allocation
concept for the subordinate certificates is the Subordinate Principal
Distribution Amount.

       The Class AIO Certificates are interest-only certificates and will not
be entitled to payments of principal.

       See "Description of the Certificates -- Distributions of Principal" and
"Yield, Prepayment and Weighted Average Life" in this prospectus supplement.

CLASS P AND CLASS E CERTIFICATES

       The Class P Certificates will be entitled to receive prepayment
penalties paid by borrowers upon voluntary full or partial prepayment of
certain of the mortgage loans. Accordingly, these amounts will not be available
for distribution to other classes of certificates.

       The Class E Certificates will be entitled to amounts representing a
portion of excess interest generated by any employee mortgage loan if the
related borrower ceases to be an employee of the underwriter or its affiliates.


       Neither the Class P nor the Class E Certificates are offered by this
prospectus supplement.

       See "Description of the Mortgage Pool" in this prospectus supplement.

LIMITED RECOURSE

       The only source of cash available to make interest and principal
payments on the certificates


                                      S-3


will be the assets of the trust fund. The trust fund will have no other source
of cash and no other entity will be required or expected to make any payments
on the certificates.

ENHANCEMENT OF LIKELIHOOD OF PAYMENT ON THE CERTIFICATES

       The payment structure used by the trust fund includes subordination and
loss allocation features to enhance the likelihood that holders of more senior
classes of certificates will receive regular payments of interest and
principal. The senior certificates will be less likely to experience losses
than the subordinate certificates, and each class of subordinate certificates
with a lower numerical class designation will be less likely to experience
losses than each class of subordinate certificates with a higher numerical
class designation.

       See "Risk Factors -- Potential Inadequacy of Credit Enhancement" and
"Description of the Certificates -- Allocation of Realized Losses" in this
prospectus supplement for a detailed description of subordination and loss
allocation features.

SUBORDINATION OF PAYMENTS

       Certificates with an "A" or "R" in their class designation will have a
payment priority over other certificates. The Class B1 Certificates will have a
payment priority over the Class B2 and Class B3 Certificates, and the Class B2
Certificates will have a payment priority over the Class B3 Certificates. The
Class B3 Certificates will have a payment priority over the Class B4, Class B5
and Class B6 Certificates.

       In addition, up to and including the Distribution Date in November 2009,
the subordinate certificates will not receive any principal prepayments unless
the senior certificates are paid down to zero. After that time and subject to
certain performance triggers, the subordinate certificates will receive
increasing portions of principal prepayments over time.

       See "Description of the Certificates -- Priority of Distributions" and "
-- Distributions of Principal" in this prospectus supplement.

ALLOCATION OF LOSSES

       If the mortgage loans experience losses (except as described in this
prospectus supplement), then the principal amount of the class of certificates
that is lowest in seniority and still outstanding will be reduced by the amount
of those losses until the total outstanding principal amount of that class
equals zero.

 o    For example, losses will first be allocated in reduction of the principal
      amount of the Class B6 Certificates until it has been reduced to zero,
      then to the Class B5 Certificates, Class B4 Certificates, Class B3
      Certificates, Class B2 Certificates and Class B1 Certificates, until the
      principal amount of each such certificate has been reduced to zero. If
      the applicable subordination is insufficient to absorb losses, then such
      additional losses will reduce the principal amounts of the senior
      certificates.

 o    If a loss has been allocated to reduce the certificate principal amount
      of your class, you will receive no payment in respect of that reduction.

       See "Description of the Certificates -- Allocation of Realized Losses"
in this prospectus supplement.

CLASS A2 AUCTION

       During the five business days prior to the distribution date occurring
on the first auction distribution date (as described herein), the auction
administrator or its agent will solicit at least three bids from third-party
bidders for purchase of the Class A2 certificates for an amount not less than
the minimum call price (as described herein). This process will be repeated
every three months until the auction administrator receives at least three bids
and at least one such bid is not less than the minimum call price. The auction
administrator will be reimbursed for the costs of the auction and sale before
the minimum call price (exclusive of the costs and expenses referred to in
clause (3) below) is distributed to the Class A2 Certificateholders. If the
amount received in the auction is greater than the minimum call price, such
excess will be paid to the holder of the Class A3 Certificates. The minimum
call price for the Class A2 Certificates will be equal to the sum of (1) the
outstanding principal balance of the Class A2 certificates after application of
all principal distributions and realized losses on the auction distribution
date, (2) accrued interest on the


                                      S-4


Class A2 Certificates at the related interest rate from the first day of the
month in which the auction distribution date occurs, up to but excluding the
auction distribution date, and (3) the cost and expenses incurred by the
auction administrator in conjunction with the Class A2 auction. If you hold a
Class A2 Certificate on the distribution date that the minimum call price is
received, your certificate will be transferred to the highest bidder on that
distribution date, thereby ending your investment in that certificate. Holders
of the Class A2 Certificates will receive the minimum call price (as defined
above, less the reimbursement of the costs and expenses incurred by the auction
administrator) on the auction distribution date that the minimum call price is
received. If the minimum call price is not received on the first auction
distribution date, the interest rate for the Class A2 Certificates for each
distribution date thereafter will increase to 5.36% per annum (subject to a
maximum rate equal to the Available Funds Cap (as described herein)).
Thereafter, the auction will be repeated every three months until the minimum
call price is received. If the minimum call price is received, the interest
rate for the Class A2 Certificates shall thereafter equal the Net WAC.
Following the auction distribution date on which the minimum call price is
received and after the class principal amounts of the Class A1 and Class A2
Certificates have been reduced to zero, the Class A2 Certificates shall receive
all amounts of interest and principal otherwise payable to the Class A3
Certificates until the class principal amount of the Class A3 Certificates has
been reduced to zero. The Class AIO Certificates will receive no distributions
of any kind following the first auction distribution date regardless of whether
the minimum call price is received. See "Description of the Certificates--Class
A2 Auction" in this prospectus supplement.


ACCELERATED PRINCIPAL PAYMENTS

       Beginning with the first distribution date, the interest accrued on the
Class A3 Certificates will be distributed first to the Class A1 Certificates,
until the certificate principal balance of the Class A1 Certificates is reduced
to zero and then to the Class A2 Certificates, until the certificate principal
balance of the Class A2 Certificates is reduced to zero. The class principal
amount of the Class A3 Certificates will be increased on each distribution date
by an amount equal to the interest accrued on the Class A3 Certificates for
such distribution date to the extent such interest was distributed as principal
as described in the preceding sentence.


THE MORTGAGE LOANS

       On the closing date, which is expected to be on or about December 15,
2004, the assets of the trust fund will consist primarily of a pool of mortgage
loans with a total principal balance as of the cut-off date (November 1, 2004)
of approximately $322,668,769. The mortgage loans will be secured by mortgages,
deeds of trust, or other security instruments, all of which are referred to in
this prospectus supplement as mortgages.

       The mortgage loans in the trust fund will consist of fixed rate,
conventional, fully amortizing, first lien residential mortgage loans, all of
which have original terms to maturity of 30 years.

       The mortgage loans are not insured or guaranteed by any government
agency.

       See "Description of the Mortgage Pool" in this prospectus supplement and
"The Trust Funds -- The Mortgage Loans" in the prospectus for a general
description of the mortgage loans.

       None of the mortgage loans in the trust fund will be "high-cost loans"
under applicable federal, state or local anti-predatory or anti-abusive lending
laws.


SERVICING OF THE MORTGAGE LOANS

       The mortgage loans will be master serviced by Aurora Loan Services Inc.
The master servicer will oversee the servicing of the mortgage loans by the
various primary loan servicers, but will not be ultimately responsible for the
servicing of the mortgage loans except as described in this prospectus
supplement. Subsequent to the closing date, primary servicing may be
transferred to primary servicers other than the initial servicers in accordance
with the provisions of the trust agreement and the servicing agreements, as
described in this prospectus supplement.

       See "The Master Servicer," "The Servicers" and "Servicing of the
Mortgage Loans" in this prospectus supplement.


                                      S-5


OPTIONAL PURCHASE OF THE MORTGAGE LOANS

       Aurora Loan Services Inc., as master servicer, may purchase the mortgage
loans on any distribution date after the date on which the total principal
balance of the mortgage loans declines to less than 10% of their initial total
principal balance. If the mortgage loans are purchased, certificateholders will
be paid (as applicable) accrued interest and principal equal to the outstanding
certificate principal amount of the certificates.

       See "Description of the Certificates -- Optional Termination of the
Trust Fund" in this prospectus supplement for a description of the purchase
price to be paid for the mortgage loans.

FINANCING

       An affiliate of the underwriter has provided financing for the mortgage
loans. The depositor will use a portion of the proceeds of the sale of the
certificates to repay the financing.

TAX STATUS

       The trustee will elect to treat the trust fund (exclusive of amounts
payable in respect of the Class E and Class P Certificates) as one or more
REMICs for federal income tax purposes. Each of the certificates, other than
the Class E, Class P and Class R Certificates, will represent ownership of
"regular interests" in a REMIC and the Class R Certificate will be designated
as the sole class of "residual interest" in each REMIC. In addition to
representing a REMIC regular interest, the Class A2 Certificates will also be
treated for federal income tax purposes as representing rights to receive
certain payments under interest rate cap contracts. The Class E and Class P
Certificates will evidence an interest in the trust fund but not in any REMIC.

       Certain classes of certificates may be issued with original issue
discount for federal income tax purposes.

       There are restrictions on the ability of certain types of investors to
purchase the Class R Certificate.

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

ERISA CONSIDERATIONS

       Generally, all of the certificates offered by the prospectus supplement
(except for the Class R Certificate) may be acquired by employee benefit plans
or other arrangements subject to Title I of the Employee Retirement Income
Security Act of 1974, as amended, or Section 4975 of the Internal Revenue Code
of 1986, as amended. A fiduciary of any such employee benefit plan or
arrangement must determine that the acquisition of a certificate is consistent
with its fiduciary duties under applicable law and does not constitute or
result in a non-exempt prohibited transaction under applicable law.

       Additional restrictions apply to the ability of employee benefit plans
or arrangements to acquire the Class A2 Certificates. Prior to the completion
of the auction sale of Class A2 Certificates (including the payment of any
amounts due to the Class A3 Certificateholder from the auction proceeds), the
Class A2 Certificates, or any interest therein, may not be acquired or held by
an employee benefit plan or arrangement, or any person acting for, on behalf of
or with any assets of any such employee benefit plan or arrangement, unless the
employee benefit plan or arrangement's acquisition and holding of the Class A2
Certificates would be exempt under an applicable United States Department of
Labor Prohibited Transaction Exemption described in this Prospectus Supplement
under "ERISA Considerations."

       See "ERISA Considerations" in this prospectus supplement and in the
prospectus for a more complete discussion of these issues.


LEGAL INVESTMENT CONSIDERATIONS

       Generally, the certificates offered by this prospectus supplement (other
than the Class B2 and Class B3 Certificates) will constitute "mortgage related
securities" for purposes of the Secondary Mortgage Market Enhancement Act of
1984.

       There are other restrictions on the ability of certain types of
investors to purchase the certificates that prospective investors should also
consider.

       See "Legal Investment Considerations" in this prospectus supplement and
in the prospectus.


                                      S-6


RATINGS OF THE CERTIFICATES

       The certificates offered by this prospectus supplement will initially
have the following ratings from Moody's Investors Service, Inc. and Standard &
Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. The
designation "N/A" means that a rating agency will not publicly rate the
certificates of that class:






                 MOODY'S      S&P
CLASS             RATING     RATING
-------------   ---------   -------

A1 ..........      Aaa        AAA
A2 ..........      Aaa        AAA
AIO .........      Aaa        AAA
R ...........      Aaa        AAA
B1 ..........      N/A         AA
B2 ..........      N/A         A
B3 ..........      N/A        BBB



 o    These ratings are not recommendations to buy, sell or hold these
      certificates. A rating may be changed or withdrawn at any time by the
      assigning rating agency.


 o    The ratings do not address the possibility that, as a result of principal
      prepayments, the yield on your certificates may be lower than
      anticipated.


       See "Ratings" in this prospectus supplement for a more complete
discussion of the certificate ratings.


                                      S-7


                                 RISK FACTORS

     THE FOLLOWING INFORMATION, WHICH YOU SHOULD CAREFULLY CONSIDER, IDENTIFIES
CERTAIN SIGNIFICANT SOURCES OF RISK ASSOCIATED WITH AN INVESTMENT IN THE
OFFERED CERTIFICATES.


POTENTIAL INADEQUACY OF CREDIT
 ENHANCEMENT..................   The certificates are not insured by any
                                 financial guaranty insurance policy or by any
                                 governmental agency. The features of
                                 subordination and loss allocation, each as
                                 described in this prospectus supplement, are
                                 intended to enhance the likelihood that holders
                                 of more senior classes will receive regular
                                 payments of interest and principal, but are
                                 limited in nature and may be insufficient to
                                 cover all losses on the mortgage loans.

                                 The amount of any loss (other than any
                                 "excess" losses described in this prospectus
                                 supplement) experienced on a mortgage loan
                                 will be applied to reduce the principal amount
                                 of the class of subordinate certificates with
                                 the highest numerical class designation, until
                                 the principal amount of that class has been
                                 reduced to zero. If subordination is
                                 insufficient to absorb losses, then
                                 certificateholders of more senior classes will
                                 likely incur losses and may never receive all
                                 of their principal payments. You should
                                 consider the following:

                                  o if you buy a Class B3 Certificate and
                                    losses on the mortgage loans exceed the
                                    total principal amount of the Class B4,
                                    Class B5 and Class B6 Certificates, the
                                    principal amount of your certificate will
                                    be reduced proportionately with the
                                    principal amounts of the other Class B3
                                    Certificates by the amount of that excess;

                                  o if you buy a Class B2 Certificate and
                                    losses on the mortgage loans exceed the
                                    total principal amount of the Class B3,
                                    Class B4, Class B5 and Class B6
                                    Certificates, the principal amount of your
                                    certificate will be reduced proportionately
                                    with the principal amounts of the other
                                    Class B2 Certificates by the amount of that
                                    excess;

                                  o if you buy a Class B1 Certificate and
                                    losses on mortgage loans exceed the total
                                    principal amount of the Class B2, Class B3,
                                    Class B4, Class B5 and Class B6
                                    Certificates, the principal amount of your
                                    certificate will be reduced proportionately
                                    with the principal amounts of the other
                                    Class B1 Certificates by the amount of that
                                    excess; and

                                  o after the total principal amount of the
                                    subordinate certificates has been reduced
                                    to zero, losses on the mortgage loans will
                                    reduce proportionately the principal
                                    amounts of the Class A1, Class A2 and Class
                                    A3 and Class R Certificates and the
                                    notional amount of the Class AIO
                                    Certificates.

                                      S-8


                                 See "Description of the Certificates --
                                 Priority of Distributions" and "-- Allocation
                                 of Realized Losses" in this prospectus
                                 supplement.


GEOGRAPHIC CONCENTRATION OF
 MORTGAGE LOANS...............   All of the mortgage loans expected to be
                                 included in the trust fund on the closing date
                                 are secured by properties located in
                                 California. The rate of delinquencies, defaults
                                 and losses on the mortgage loans may be higher
                                 than if fewer of the mortgage loans were
                                 concentrated in that state because the
                                 following conditions in California will have a
                                 disproportionate impact on the mortgage loans
                                 in general:

                                  o Weak economic conditions, 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 residential real estate
                                    market in California may reduce the values
                                    of properties, which would result in an
                                    increase in the loan-to-value ratios.

                                  o Properties in California may be more
                                    susceptible than homes located in other
                                    parts of the country to certain types of
                                    uninsurable hazards, such as earthquakes,
                                    as well as storms, floods, wildfires,
                                    mudslides and other natural disasters.

                                 Natural disasters affect regions of California
                                 from time to time and may result in increased
                                 losses on mortgage loans in California, or in
                                 insurance payments that will constitute
                                 prepayments of those mortgage loans.

                                 For additional information regarding the
                                 geographic concentration of the mortgage
                                 loans, see the geographic distribution table
                                 under "Description of the Mortgage Pool" in
                                 this prospectus supplement.


UNPREDICTABILITY AND EFFECT OF
 PREPAYMENTS..................   The rate of prepayments on the mortgage loans
                                 will be sensitive to prevailing interest rates.
                                 Generally, if prevailing interest rates
                                 decline, mortgage loan prepayments may increase
                                 due to the availability of refinancing at lower
                                 interest rates. If prevailing interest rates
                                 rise, prepayments on the mortgage loans may
                                 decrease.

                                 Borrowers may prepay their mortgage loans in
                                 whole or in part at any time; however,
                                 approximately 39.95% of the mortgage loans
                                 require the payment of a prepayment premium in
                                 connection with any voluntary prepayments in
                                 full, and certain voluntary prepayments in
                                 part, made during periods ranging from four
                                 months to five years after origination. These
                                 prepayment premiums may discourage borrowers
                                 from prepaying their mortgage loans during the
                                 applicable period. The Class P Certificates
                                 will be entitled to all prepayment penalties
                                 received on the mortgage loans. Otherwise, the
                                 prepayment penalties will not be available for
                                 distribution to certificateholders.


                                      S-9


                                 The timing of prepayments of principal may
                                 also be affected by liquidations of or
                                 insurance payments on the mortgage loans. In
                                 addition, Lehman Brothers Holdings Inc., as
                                 the seller of the mortgage loans to the
                                 depositor, or the party from which Lehman
                                 Brothers Holdings Inc. acquired a particular
                                 mortgage loan, may be required to purchase
                                 mortgage loans from the trust in the event
                                 that certain breaches of representations and
                                 warranties made with respect to the mortgage
                                 loans are not cured. These purchases will have
                                 the same effect on certificateholders as
                                 prepayments of mortgage loans.

                                 A prepayment of a mortgage loan will usually
                                 result in a payment of principal on the
                                 offered certificates:

                                  o If you purchase your certificates at a
                                    discount and principal prepayments on the
                                    mortgage loans are received at a rate
                                    slower than you anticipate, then your yield
                                    may be lower than you anticipate.

                                  o If you purchase your certificates at a
                                    premium and principal prepayments on the
                                    mortgage loans are received at a rate
                                    faster than you anticipate, then your yield
                                    may be lower than you anticipate.

                                  o The prepayment experience of the mortgage
                                    loans may differ significantly from that of
                                    other first lien residential mortgage
                                    loans.

                                 See "Yield, Prepayment and Weighted Average
                                 Life" in this prospectus supplement for a
                                 description of the factors that may influence
                                 the rate and timing of prepayments on the
                                 mortgage loans.


SPECIAL RISKS FOR CERTAIN
 CLASSES OF CERTIFICATES......   The Class AIO Certificates are interest-only
                                 certificates. These certificates have yields to
                                 maturity (or optional termination)--the yield
                                 you will receive if you hold a certificate
                                 until it has been paid in full--that are highly
                                 sensitive to prepayments on the related
                                 mortgage loans.

                                 THE CLASS AIO CERTIFICATES WILL NOT BE
                                 ENTITLED TO DISTRIBUTIONS OF ANY KIND AFTER
                                 THE DISTRIBUTION DATE ON WHICH THE FIRST
                                 AUCTION DISTRIBUTION DATE OCCURS, AS DESCRIBED
                                 IN THIS PROSPECTUS SUPPLEMENT.

                                 If you purchase the Class AIO Certificates,
                                 you should consider the risk that you may
                                 receive a lower than expected yield if there
                                 is a faster than expected rate of prepayments
                                 on the mortgage loans. In addition,
                                 prepayments on the mortgage loans, including
                                 liquidations, repurchases and insurance
                                 payments, could result in the failure of
                                 investors in the Class AIO Certificates to
                                 fully recover their initial investments.
                                 Prepayments on the related mortgage loans may
                                 occur as a result of solicitations of the
                                 borrowers by mortgage loan providers,
                                 including the seller and its affiliates, the
                                 master servicer


                                      S-10


                                 and servicers, as described under "Yield,
                                 Prepayment and Weighted Average Life" in this
                                 prospectus supplement. See "Yield, Prepayment
                                 and Weighted Average Life" in this prospectus
                                 supplement for a description of factors that
                                 may affect the sensitivity of these
                                 certificates' yield to maturity.


MILITARY ACTION AND TERRORIST
 ATTACKS......................   The effects that military action by U.S.
                                 forces in Iraq, Afghanistan or other regions,
                                 terrorist attacks in the United States or other
                                 incidents and related military action may have
                                 on the performance of the mortgage loans or on
                                 the values of mortgaged properties cannot be
                                 determined at this time. Investors should
                                 consider the possible effects on delinquency,
                                 default and prepayment experience of the
                                 mortgage loans. Federal agencies and
                                 non-government lenders may defer, reduce or
                                 forgive payments and delay foreclosure
                                 proceedings in respect of loans to borrowers
                                 affected in some way by possible future events.
                                 In addition, activation of additional U.S.
                                 military reservists or members of the National
                                 Guard may significantly increase the proportion
                                 of mortgage loans whose mortgage rates are
                                 reduced by application of the Servicemembers
                                 Civil Relief Act or similar state laws. The
                                 interest distributable to holders of the senior
                                 and subordinate certificates will be reduced on
                                 a proportionate basis by any reductions in the
                                 amount of interest collectible as a result of
                                 application of the Relief Act or similar state
                                 laws and none of the servicers, the master
                                 servicer or any other party will be required to
                                 fund any interest shortfall caused by any such
                                 reduction.


DELINQUENCIES ON THE MORTGAGE
 LOANS........................   The mortgage loans were originated or
                                 acquired by the originators in accordance,
                                 generally, with underwriting guidelines of the
                                 type described in this prospectus supplement.
                                 In general, these guidelines do not meet every
                                 criterion of Fannie Mae's or Freddie Mac's
                                 guidelines, so the mortgage loans may
                                 experience rates of delinquency, foreclosure
                                 and bankruptcy that are higher than those
                                 experienced by mortgage loans underwritten in
                                 strict accordance with Fannie Mae or Freddie
                                 Mac standards.

                                 Changes in the values of mortgaged properties
                                 related to the mortgage loans may have a
                                 greater effect on the delinquency,
                                 foreclosure, bankruptcy and loss experience of
                                 the mortgage loans in the trust fund than on
                                 mortgage loans originated under Fannie Mae's
                                 or Freddie Mac's guidelines. We cannot assure
                                 you that the values of the mortgaged
                                 properties have remained or will remain at
                                 levels in effect on the dates of origination
                                 of the related mortgage loans.

                                 See "Description of the Mortgage Pool --
                                 General" in this prospectus supplement for a
                                 description of the characteristics of the
                                 mortgage loans and "Underwriting


                                      S-11


                                 Guidelines" for a general description of the
                                 underwriting guidelines used in originating
                                 the mortgage loans.


DELINQUENCIES DUE TO SERVICING
 TRANSFER.....................   Mortgage loans serviced by the servicers may
                                 be transferred in the future to other servicers
                                 in accordance with the provisions of the trust
                                 agreement and the related servicing agreement
                                 as a result of, among other things, (1) the
                                 occurrence of unremedied events of default in
                                 servicer performance under a servicing
                                 agreement or (2) the exercise by the Seller of
                                 its right to terminate a servicer without
                                 cause.

                                 Mortgage loans subject to servicing transfers
                                 may experience increased delays in payments
                                 until all of the borrowers are informed of the
                                 transfer and the related servicing mortgage
                                 files and records and all other relevant data
                                 has been obtained by the new servicer.

                                 See "The Servicers" and "Servicing of the
                                 Mortgage Loans" in this prospectus supplement.



LIMITED ABILITY TO RESELL
 CERTIFICATES.................   The underwriter is not required to assist in
                                 resales of the offered certificates, although
                                 it may do so. A secondary market for any class
                                 of offered certificates may not develop. If a
                                 secondary market does develop, it might not
                                 continue or it might not be sufficiently liquid
                                 to allow you to resell any of your
                                 certificates.


THE CALLABLE CERTIFICATES HAVE
 SPECIAL RISKS................   The Class A2 Certificates are callable
                                 certificates. Five business days prior to the
                                 distribution date occurring on the first
                                 auction distribution date, the auction
                                 administrator will auction the Class A2
                                 Certificates then outstanding to third-party
                                 bidders. The auction administrator will not
                                 sell the Class A2 Certificates unless it has
                                 received at least three bids and at least one
                                 such bid is for not less than the minimum call
                                 price (as defined herein). Proceeds from the
                                 auction will be used to pay the holders of the
                                 Class A2 Certificates the minimum call price
                                 (exclusive of the costs and expenses incurred
                                 by the auction administrator). However, if the
                                 minimum call price is not received, the Class
                                 A2 Certificates will not be transferred to any
                                 such third-party bidders and the interest rate
                                 on the Class A2 Certificates for each
                                 distribution date thereafter will be increased
                                 to an annual rate of 5.36% per annum (subject
                                 to a maximum rate equal to the Available Funds
                                 Cap). Thereafter, the auction will be repeated
                                 every three months as described above until the
                                 minimum call price is received. On the first
                                 distribution date following an auction
                                 distribution date on which the minimum call
                                 price is received, the interest rate for the
                                 Class A2 Certificates will be an annual rate
                                 equal to the Net WAC. Following the auction
                                 distribution date on which the minimum call
                                 price


                                      S-12


                                 is received and after the class principal
                                 amounts of the Class A1 and Class A2
                                 Certificates have been reduced to zero, the
                                 Class A2 Certificates shall receive all
                                 amounts of interest and principal otherwise
                                 payable to the Class A3 Certificates until the
                                 class principal amount of the Class A3
                                 Certificates has been reduced to zero. If the
                                 minimum call price is not received, the
                                 holders of the Class A2 Certificates will
                                 continue to hold their certificates after the
                                 auction distribution date, unless they choose
                                 to sell them in the secondary market or the
                                 minimum call price is received on a subsequent
                                 distribution date. To the extent the Class A2
                                 Certificates are then sold in the secondary
                                 market, the holders may incur a loss. See
                                 Descriptions of the Certificates--Class A2
                                 Auction" in this prospectus supplement.

                                      S-13


                        DESCRIPTION OF THE CERTIFICATES

GENERAL

     The Series 2004-22 Structured Asset Securities Corporation Mortgage
Pass-Through Certificates (the "Certificates") will consist of the classes of
Certificates (each a "Class") set forth in the table on page S-2, together with
the Class A3, Class B4, Class B5, Class B6, Class E and Class P Certificates.
The Class A1, Class A2, Class A3 and Class AIO Certificates and the Class R
Certificate are referred to herein as the "Senior Certificates;" the Class B1,
Class B2 and Class B3 Certificates are referred to herein as the "Offered
Subordinate Certificates;" and together with the Class B4, Class B5 and Class
B6 Certificates, the "Subordinate Certificates." Only the Senior Certificates
(other than the Class A3 Certificates) and the Offered Subordinate Certificates
(collectively, the "Offered Certificates") are offered hereby. The Class AIO
Certificates are sometimes referred to herein as the "Interest-Only
Certificates." The Class A2 Certificates are sometimes referred to herein as
the "Callable Certificates." The Class E and Class P Certificates will also be
issued but not offered by this Prospectus Supplement.

     The Certificates represent beneficial ownership interests in a trust fund
(the "Trust Fund"), the assets of which consist primarily of (1) a pool (the
"Mortgage Pool") of fixed rate, fully amortizing, conventional, first lien,
residential mortgage loans (the "Mortgage Loans"), (2) such assets as from time
to time are identified as deposited in respect of the Mortgage Loans in the
certificate account, (3) property acquired by foreclosure of Mortgage Loans or
deed in lieu of foreclosure, (4) any applicable insurance policies and (5) all
proceeds thereof.

     Each Class of Offered Certificates will be issued in the respective
approximate initial total principal amount (a "Class Principal Amount")
specified in the table on page S-2 or total notional amount (a "Class Notional
Amount") described under "-- Distributions of Interest" herein. The approximate
initial Class Principal Amount of each of the Class B4, Class B5 and Class B6
Certificates is $806,000, $484,000 and $325,669, respectively. The aggregate
Class Principal Amount of the Class B4, Class B5 and Class B6 Certificates
represents approximately 0.50% of the aggregate Class Principal Amount of all
of the Certificates. The initial total Class Principal Amount or the initial
Class Notional Amount, as applicable, of all the Certificates may be increased
or decreased by up to five percent to the extent that the total Cut-off Date
Balance (as defined herein) of the Mortgage Loans is increased or decreased as
described under "Description of the Mortgage Pool" herein.

     The Class E Certificates will be entitled to cash flow arising solely from
certain excess interest collected on any Employee Mortgage Loan (as defined
herein). See "Description of the Mortgage Pool" herein. Such amounts will not
be available for distribution to the holders of the other Classes of
Certificates.

     The Class P Certificates will be entitled to all prepayment penalties
received in respect of the Mortgage Loans, and accordingly, such amounts will
not be available for distribution to the holders of the other Classes of
Certificates.

     Distributions on the Certificates will be made on the 25th day of each
month or, if the 25th day is not a Business Day, on the next succeeding
Business Day, beginning in December 2004 (each, a "Distribution Date"), to
Certificateholders of record on the applicable Record Date. The "Record Date"
for each Distribution Date for all the Certificates (other than the Class A1
Certificates and with respect to the first Distribution Date, the Class AIO
Certificates) will be the last Business Day of the month immediately preceding
the month in which the Distribution Date occurs. The "Record Date" for each
Distribution Date for the Class A1 Certificates will be the close of business
on the Business Day immediately preceding such Distribution Date. With respect
to the Class AIO Certificates and the first Distribution Date, the "Record
Date" shall be the Closing Date. A "Business Day" is generally any day other
than a Saturday or Sunday or a day on which banks in New York or Colorado, or
the city in which the Corporate Trust Office (as defined herein) is located,
are closed.

     Distributions on the Certificates will be made to each registered holder
entitled thereto, either (1) by wire transfer in immediately available funds if
the Certificateholder has provided to the Trustee


                                      S-14


wire instructions for such registered holder or (2) by check mailed to the
address of the Certificateholder as it appears on the books of the Trustee if
the Certificateholder has not provided wire instructions; provided that the
final distribution in respect of any Certificate will be made only upon
presentation and surrender of the Certificate at the Corporate Trust Office (as
defined herein) of the Trustee. See "-- The Trustee" herein.

     The Offered Certificates, other than the Class R Certificate
(collectively, the "Book-Entry Certificates") will be issued, maintained and
transferred on the book-entry records of The Depository Trust Company ("DTC")
and its Participants (as defined herein). The Class A1 and Class A2
Certificates will be issued in minimum denominations of $25,000 and integral
multiples of $1 in excess thereof. The Class B1, Class B2 and Class B3
Certificates will each be issued in minimum denominations of $100,000 and
integral multiples of $1 in excess thereof. The Class AIO Certificates will be
issued in minimum denominations of $1,000,000 in Notional Amount (as defined
herein) and integral multiples of $1 in excess thereof. The Class R Certificate
(the "Residual Certificate") will be issued as a single certificate and
maintained in definitive, fully registered form, representing the entire
Percentage Interest in that Class.

    o When used to establish minimum denominations and otherwise with respect
      to a Class of Certificates, the "Percentage Interest" of a Certificate
      will be the fraction, expressed as a percentage, the numerator of which
      is that Certificate's Certificate Principal Amount or Notional Amount and
      the denominator of which is the applicable Class Principal Amount or
      Class Notional Amount. When used to determine voting rights of
      Certificateholders, the Percentage Interest of a Certificate other than
      an Interest-Only Certificate will be the fraction, expressed as a
      percentage, the numerator of which is that Certificate's Certificate
      Principal Amount and the denominator of which is the total of the Class
      Principal Amounts of all such Classes of Certificates; and the Percentage
      Interest of an Interest-Only Certificate will be the fraction, expressed
      as a percentage, the numerator of which is that Certificate's Notional
      Amount and the denominator of which is the total of the Class Notional
      Amounts of all such Classes of Certificates.

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

BOOK-ENTRY REGISTRATION

     GENERAL. Persons acquiring beneficial ownership interests in the
Book-Entry Certificates will hold their Certificates through DTC in the United
States, or Clearstream Banking Luxembourg (formerly Cedelbank) (hereinafter,
"Clearstream Luxembourg") or the Euroclear System ("Euroclear") in Europe if
they are participants of such systems, or indirectly through organizations
which are participants in such systems. Each Class of Book-Entry Certificates
will be issued in one or more certificates that equal the initial Class
Principal Amount or Class Notional Amount of the related Class of Offered
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.


                                      S-15


generally, but not exclusively, will act as depositary for Clearstream
Luxembourg and JPMorgan Chase Bank generally, but not exclusively, will act as
depositary for Euroclear (in such capacities, individually the "Relevant
Depositary" and collectively, the "European Depositaries"). Except as described
below, no Beneficial Owner will be entitled to receive a physical certificate
representing such Certificate. Unless and until Definitive Certificates are
issued, it is anticipated that the only "Certificateholder" of the Offered
Certificates will be Cede & Co., as nominee of DTC. Beneficial Owners will not
be Certificateholders as that term is used in the Trust Agreement. Beneficial
Owners are only permitted to exercise their rights indirectly through
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 (a "Participant") 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 will receive all distributions of principal of, and
interest on, the Offered Certificates from the Trustee through DTC and DTC
participants. While the Offered 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 Offered Certificates and is required to receive and transmit
distributions of principal of, and interest on, the Offered Certificates.
Participants and indirect participants with whom Beneficial Owners have
accounts with respect to Offered Certificates are similarly required to make
book-entry transfers and receive and transmit such distributions on behalf of
their respective Beneficial Owners. Accordingly, although Beneficial Owners
will not possess certificates, the Rules provide a mechanism by which
Beneficial Owners will receive distributions and will be able to transfer their
interest.


     Beneficial Owners will not receive or be entitled to receive certificates
representing their respective interests in the Offered Certificates, except
under the limited circumstances described below. Unless and until Definitive
Certificates are issued, Beneficial Owners who are not Participants may
transfer ownership of Offered Certificates only through Participants and
indirect participants by instructing such Participants and indirect
participants to transfer Offered Certificates, by book-entry transfer, through
DTC for the account of the purchasers of such Offered Certificates, which
account is maintained with their respective Participants. Under the Rules and
in accordance with DTC's normal procedures, transfer of ownership of Book-Entry
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 Beneficial 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 herein) or Euroclear Participant (as defined herein) 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 Considerations -- Taxation of Securities Treated
as Debt Instruments -- Foreign Persons" in the Prospectus and "Global
Clearance, Settlement and Tax Documentation Procedures -- Certain U.S. Federal
Income Tax Documentation Requirements" in Annex A hereto.


                                      S-16


     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 the 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 Luxembourg is a duly licensed bank organized as a limited
liability company (a societe anonyme) incorporated under the laws of Grand
Duchy of Luxembourg as a professional depository. Clearstream Luxembourg holds
securities for its participating organizations ("Clearstream Luxembourg
Participants") and facilitates the clearance and settlement of securities
transactions between Clearstream Luxembourg Participants through electronic
book-entry changes in accounts of Clearstream Luxembourg Participants, thereby
eliminating the need for physical movement of certificates. Transactions may be
settled in Clearstream Luxembourg in any of various currencies, including
United States dollars. Clearstream Luxembourg provides to its Clearstream
Luxembourg 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
others, 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
("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 be settled in any of various 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 (the "Euroclear Operator"). All operations are conducted by the
Euroclear Operator, and all Euroclear securities clearance accounts and
Euroclear cash accounts are accounts with the Euroclear Operator. 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.

     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


                                      S-17


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 payment 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 and may be subject to
withholding in accordance with relevant United States tax laws and regulations.
See "Material Federal Income Tax Considerations -- Taxation of Securities
Treated as Debt Instruments -- Foreign Persons" in the Prospectus.

     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 DTC 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 physical
certificates.

     Monthly and annual reports will be provided to Cede & Co., as nominee of
DTC, and may be made available by Cede & Co. to Beneficial Owners upon request,
in accordance with the rules, regulations and procedures creating and affecting
DTC, and to the Financial Intermediaries to whose DTC accounts the Book-Entry
Certificates of such Beneficial Owners are credited.

     DTC has advised 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 Trust 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 may
be, will take any other action permitted to be taken by a Certificateholder
under the Trust 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 Book-Entry Certificates which conflict with
actions taken with respect to other Offered Certificates.

     Although DTC, Clearstream Luxembourg and Euroclear have agreed to the
foregoing procedures in order to facilitate transfers of Book-Entry
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.

     None of the Depositor, the Master Servicer or the Trustee (as such terms
are defined herein) or any of their respective affiliates will have any
responsibility for any aspect of the records relating to or


                                      S-18


payments made on account of beneficial ownership interests of the Book-Entry
Certificates held by Cede & Co., as nominee for DTC, or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests or transfers thereof.

     DEFINITIVE CERTIFICATES. Definitive Certificates will be issued to
Beneficial Owners or their nominees, respectively, rather than to DTC or its
nominee, only under the limited conditions set forth in the Prospectus under
"Description of the Securities -- Book-Entry Registration." Upon the occurrence
of an event described in the penultimate paragraph thereunder, the Trustee is
required to direct DTC to notify Participants who have ownership of Book-Entry
Certificates as indicated on the records of DTC of the availability of
Definitive Certificates for their Book-Entry Certificates. Upon surrender by
DTC of the Definitive Certificates representing the Book-Entry Certificates and
upon receipt of instructions from DTC for re-registration, the Trustee will
reissue the Book-Entry Certificates as Definitive Certificates in the
respective principal amounts owned by individual Beneficial Owners, and
thereafter the Trustee will recognize the holders of such Definitive
Certificates as Certificateholders under the Trust Agreement.

PRIORITY OF DISTRIBUTIONS

     Distributions in respect of the Certificates will be made on each
Distribution Date from the Available Distribution Amount (as defined herein)
for such Distribution Date. See "-- Available Distribution Amount" for a
description of the available funds for the Mortgage Pool.

     On each Distribution Date, the Available Distribution Amount (other than
certain amounts described under "-- Class P Certificates" and "-- Class E
Certificates" below) will be allocated among the Classes of Senior Certificates
and Classes of Subordinate Certificates, in the following order of priority:

       (1) to payment of Accrued Certificate Interest on each Class of Senior
    Certificates (reduced, in each case, by any Net Prepayment Interest
    Shortfalls (as defined herein) allocated to that Class of Certificates on
    that Distribution Date, as described herein); provided, however, that any
    shortfall in available amounts will be allocated among the Classes of
    Senior Certificates in proportion to the amount of such interest (as so
    reduced) that would otherwise be distributable thereon; provided, however,
    that on any Distribution Date, if the Class A1 or Class A2 Certificates
    are still outstanding after all other payments in reduction of their Class
    Principal Amounts on such Distribution Date, then amounts otherwise
    distributable to the Class A3 Certificates shall be paid as principal
    sequentially to the Class A1 and Class A2 Certificates, in that order, in
    reduction of their respective Class Principal Amounts until the Class
    Principal Amount of each such Class has been reduced to zero; and provided
    further, however, that following the Distribution Date on which the
    Minimum Call Price (as defined herein) is received, if the Class Principal
    Amounts of Class A1 and Class A2 Certificates have been reduced to zero,
    then amounts otherwise distributable to the Class A3 Certificates shall be
    paid to the Class A2 Certificates until the Class Principal Amount of the
    Class A3 Certificates has been reduced to zero as described in this
    prospectus supplement;

       (2) to payment of any outstanding Interest Shortfalls (as defined
    herein) on each Class of Senior Certificates; provided, however, that any
    shortfall in available amounts will be allocated among the Classes of
    Senior Certificates in proportion to the amount of such interest (as so
    reduced) that would otherwise be distributable thereon; provided, however,
    that on any Distribution Date, if the Class A1 or Class A2 Certificates
    are still outstanding after all other payments in reduction of their Class
    Principal Amounts on such Distribution Date, then amounts otherwise
    distributable to the Class A3 Certificates shall be paid as principal
    sequentially to the Class A1 and Class A2 Certificates, in that order, in
    reduction of their respective Class Principal Amounts until the Class
    Principal Amount of each such Class has been reduced to zero; and provided
    further, however, that following the Distribution Date on which the
    Minimum Call Price (as defined herein) is received, if the Class Principal
    Amounts of the Class A1 and Class A2 Certificates have been reduced to
    zero, then amounts otherwise distributable to the Class A3 Certificates
    shall be paid to the Class A2 Certificates until the Class Principal
    Amount of the Class A3 Certificates has been reduced to zero as described
    in this prospectus supplement;


                                      S-19


       (3) to payment of the Senior Principal Distribution Amount (as defined
    herein), sequentially, to the Class R Certificate, the Class A1
    Certificates, the Class A2 Certificates and Class A3 Certificates, in that
    order, in reduction of their respective Class Principal Amounts, until the
    Class Principal Amount of each such Class has been reduced to zero;
    provided, however, that following the Distribution Date on which the
    Minimum Call Price is received, if the Class Principal Amounts of Class A1
    and Class A2 Certificates have been reduced to zero, then the Senior
    Principal Distribution Amount otherwise payable to the Class A3
    Certificates shall be paid to the Class A2 Certificates until the Class
    Principal Amount of the Class A3 Certificates has been reduced to zero;
    and

       (4) to the extent of the remaining Available Distribution Amount, to
    payment to the Class B1, Class B2, Class B3, Class B4, Class B5 and Class
    B6 Certificates, in that order, of the following amounts, in the following
    order of priority: (x) Accrued Certificate Interest thereon (as reduced by
    any Net Prepayment Interest Shortfalls allocated to that Class on that
    Distribution Date), (y) any outstanding Interest Shortfalls previously
    allocated to that Class, and (z) the related Class's Subordinate Class
    Percentage (as defined herein) of the Subordinate Principal Distribution
    Amount for that Distribution Date, except as provided below, in reduction
    of its Class Principal Amount.

     With respect to each Class of Subordinate Certificates other than the
Class B6 Certificates, if on any Distribution Date the Credit Support
Percentage for that Class is less than that Class's Original Credit Support
Percentage, then no distributions in respect of clauses (2) and (3) of the
definition of Subordinate Principal Distribution Amount will be made to any
Class of lower priority (the "Restricted Classes"), and the amount otherwise
distributable to the Restricted Classes in respect of such payments will be
allocated among the remaining Classes of Subordinate Certificates,
proportionately, based upon their respective Class Principal Amount. The
"Credit Support Percentage" for a Class of Subordinate Certificates for any
Distribution Date is equal to the sum of the Class Percentages (as defined
herein) of each Class of lower priority (without giving effect to distributions
on such date). The "Original Credit Support Percentage" for a Class of
Subordinate Certificates is the Credit Support Percentage for such Class of
Subordinate Certificates on December 15, 2004 (the "Closing Date"). The "Class
Percentage" for each Class of Subordinate Certificates for each Distribution
Date will be equal to the percentage obtained by dividing the Class Principal
Amount of such Class immediately prior to that Distribution Date by the
aggregate Class Principal Amount of all Classes of Certificates immediately
prior to that date.


CLASS P CERTIFICATES

     Prepayment Penalty Amounts received with respect to the Mortgage Loans
will be distributed to the Class P Certificateholders and will not be available
to make distributions on the Offered Certificates.


CLASS E CERTIFICATES

     Excess interest equal to 0.25% per annum collected on any Employee
Mortgage Loan as a result of the related borrower ceasing to be an employee of
the Underwriter or its affiliates will be distributed to the holders of Class E
Certificates and will not be available to make distributions on the Offered
Certificates. See "Description of the Mortgage Pool -- General" herein.


DISTRIBUTIONS OF INTEREST

     The amount of interest distributable on each Distribution Date in respect
of each Class of Certificates (other than the Class A3, Class E and Class P
Certificates) will equal the Accrued Certificate Interest (as defined herein)
for that Class on that Distribution Date, as reduced by any Net Prepayment
Interest Shortfalls allocable to that Class for that date, as described below.

     "Accrued Certificate Interest" for each Class of Certificates (other than
the Class A3, Class E and Class P Certificates) for any Distribution Date will
equal the amount of interest accrued during the


                                      S-20


related Accrual Period (as defined herein) on the related Class Principal
Amount for that Distribution Date or, in the case of the Class AIO
Certificates, the related Class Notional Amount for that Distribution Date at
the applicable Interest Rate (as defined herein), as reduced by such Class's
share of (1) the interest portion of any related Excess Losses (as defined
herein) for such Distribution Date, allocable as described below, and (2) with
respect to any Mortgage Loan as to which there has been a reduction in the
amount of interest collectible as a result of application of the Servicemembers
Civil Relief Act, as amended, or similar state law (the "Relief Act," and any
such reduction, a "Relief Act Reduction"), the amount of any such reduction,
allocated as described below. See "Legal Aspects of Loans -- Servicemembers
Civil Relief Act" in the Prospectus. "Accrued Certificate Interest" for the
Class A3 Certificates for any Distribution Date will equal the amount of
interest accrued during the related Accrual Period as described herein, as
reduced by such Class's share of (1) the interest portion of any related Excess
Losses (as defined herein) for such Distribution Date, allocable as described
below, and (2) with respect to any Mortgage Loan as to which there has been a
reduction in the amount of interest collectible as a result of application of
the Relief Act, the amount of any such reduction, allocated as described below.
Interest will accrue on the Certificates on the basis of a 360-day year
consisting of twelve 30-day months.

     THE CLASS AIO CERTIFICATES WILL NOT BE ENTITLED TO RECEIVE DISTRIBUTIONS
OF ANY KIND FOLLOWING THE DISTRIBUTION DATE ON WHICH THE FIRST AUCTION
DISTRIBUTION DATE OCCURS.

     Interest distributable on the Senior Certificates will be distributed from
the Available Distribution Amount on each Distribution Date. Accrued
Certificate Interest not distributed on the Distribution Date related to the
Accrual Period in which it accrued, other than due to any Net Prepayment
Interest Shortfalls, will be an "Interest Shortfall." Accrued Certificate
Interest on the Class A3 Certificates which is paid as principal to the Class
A1 or Class A2 Certificates shall not be considered an Interest Shortfall.
Interest will not accrue on Interest Shortfalls.

     The interest portion of any Excess Loss and any Relief Act Reduction will
be allocated among the Senior Certificates and the Subordinate Certificates
proportionately based on the Accrued Certificate Interest otherwise
distributable thereon for that Distribution Date.

    o The Interest Rate for each Distribution Date and for the Class R, Class
      B1, Class B2, Class B3, Class B4, Class B5 and Class B6 Certificates will
      be an annual rate equal to the weighted average Net Mortgage Rate of the
      Mortgage Loans, weighted on the basis of their Scheduled Principal
      Balances as of the first day of the related Due Period (the "Net WAC").

    o The Interest Rate for the Class A1 Certificates for each Distribution
      Date will be an annual rate equal to 3.83%.

    o The Interest Rate for the Class A2 Certificates for each Distribution
      Date on or prior to the First Auction Distribution Date will be an annual
      rate equal to 4.86% subject to a maximum rate equal to the Available
      Funds Cap for such Distribution Date. Following the First Auction
      Distribution Date and if theMinimum Call Price is not received, the
      Interest Rate for the Class A2 Certificates for each Distribution Date
      thereafter will be an annual rate equal to 5.36% subject to a maximum
      rate equal to the Available Funds Cap. Following the First Auction
      Distribution Date and if the Minimum Call Price is received, the Interest
      Rate for the Class A2 Certificates will be an annual rate equal to the
      Net WAC for each succeeding Distribution Date.

    o The Class AIO Certificates will bear interest each Distribution Date on
      or prior to the First Auction Distribution Date at an annual rate equal
      to the greater of (i) 0.00% per annum and (ii) the excess of (a) the Net
      WAC over (b) the Class A2 Interest Rate. After the First Auction
      Distribution Date, the Class AIO Certificates will not be entitled to
      distributions of any kind.

    o On each Distribution Date, the Class A3 Certificates will be entitled to
      an amount equal to the greater of (1) $0.00 and (2)(A) the amount of
      interest accruing during the related Due Period at the Net WAC on the
      Mortgage Loans (exclusive of any interest accruing on the Mortgage Loans
      payable to the Subordinate Certificates) less (B) the total interest
      accrued for


                                      S-21


      the related Accrual Period on the Class R, Class A1, Class A2 and Class
      AIO Certificates. However, such interest distribution amounts will be
      paid as principal, sequentially, to the Class A1 and Class A2
      Certificates as described herein. The Class Principal Amount of the Class
      A3 Certificates will be increased on each Distribution Date by an amount
      equal to the interest accrued on the Class A3 Certificates for such
      Distribution Date to the extent such interest was distributed as
      principal as described in the preceding sentence. Following the Auction
      Distribution Date on which the Minimum Call Price is received and after
      the Class Principal Amount of the Class A2 Certificates has been reduced
      to zero, amounts otherwise distributable to the Class A3 Certificates
      shall be distributed to the Class A2 Certificates until the Class
      Principal Amount of the Class A3 Certificates has been reduced to zero.


    o The "Available Funds Cap" relating to the Class A2 Certificates on each
      Distribution Date up to but excluding the Distribution Date following the
      date on which the Minimum Call Price is received will be a rate equal to
      the sum of the Class Principal Amount of the Class A2 and Class A3
      Certificates multiplied by the Net WAC and divided by the Class Principal
      Amount of the Class A2 Certificates.


    o The "First Auction Distribution Date" for the Class A2 Certificates will
      be the earlier to occur of (x) the Distribution Date that occurs in
      December 2009 and (y) the Distribution Date on which the beginning
      Scheduled Principal Balance of the Mortgage Loans declines to less than
      20% of the Cut-Off Date Balance of the Mortgage Loans. If the Minimum
      Call Price is not received on the First Auction Distribution Date, an
      auction will occur on every third Distribution Date (each, an "Auction
      Distribution Date") thereafter until the Minimum Call Price is received.


    o The "Net Mortgage Rate" of any Mortgage Loan is its mortgage interest
      rate (the "Mortgage Rate") less the sum of the applicable Servicing Fee
      Rate (as defined herein), and any mortgage insurance premium, as
      applicable thereto. Generally, the Net Mortgage Rate of any Employee
      Mortgage Loan will be calculated without regard to any increase in the
      Mortgage Rate thereof as a result of the related mortgagor ceasing to be
      an employee of the Underwriter or its affiliates.


    o The "Certificate Principal Amount" of any Certificate (other than a
      Class A3, Class E or Class P Certificate or an Interest-Only Certificate)
      as of any Distribution Date will equal its Certificate Principal Amount
      as of the Closing Date as reduced by all amounts previously distributed
      on that Certificate in respect of principal and the principal portion of
      any Realized Losses previously allocated to that Certificate. The
      Certificate Principal Amount of a Class of Subordinate Certificates may
      be additionally reduced by allocation of any Subordinate Certificate
      Writedown Amounts. However, on any Distribution Date on which a
      Subsequent Recovery (as defined herein) is distributed, the Certificate
      Principal Amount of any Class of Certificates then outstanding for which
      any Realized Loss or any Subordinate Certificate Writedown Amount has
      been applied will be increased, in order of seniority, by an amount (to
      be applied pro rata to all Certificates of such Class) equal to the
      lesser of (i) the amount the Class of Certificates has been reduced by
      any Realized Losses or any Subordinate Certificate Writedown Amount which
      has not been previously increased by any Subsequent Recovery and (ii) the
      total amount of any Subsequent Recovery distributed on such date to
      Certificateholders, after application (for this purpose) to more senior
      Classes of Certificates;


    o The "Notional Amount" of each Interest-Only Certificate as of any
      Distribution Date will equal that Certificate's Percentage Interest of
      the Class Notional Amount of the related Class for that date. The Class
      Notional Amounts for the Interest-Only Certificates will be as follows:


                                      S-22


       o The Class Notional Amount of the Class AIO Certificates for each
         Distribution Date up to and including the First Auction Distribution
         Date shall equal the Class Principal Amount of the Class A1 and Class
         A2 Certificates immediately prior to such Distribution Date.
         Thereafter, the Class Notional Amount of the Class AIO Certificates
         shall equal zero. The initial Class Notional Amount of the Class AIO
         Certificates is $306,696,000.

    o The "Accrual Period" for each Class of Certificates (other than the
      Class A1 Certificates) will be the calendar month immediately preceding
      the month in which the related Distribution Date occurs. In the case of
      the Class A1 Certificates, the Accrual Period will be the period from and
      including the preceding Distribution Date (or from November 30, 2004, in
      the case of the first Distribution Date) to and including the day prior
      to such Distribution Date.

     When a principal prepayment in full is made on a Mortgage Loan, the
borrower is charged interest only to the date of such prepayment, instead of
for a full month, with a resulting reduction in interest payable for the month
during which the prepayment is made. Full or partial prepayments (or proceeds
of other liquidations) received in the applicable Prepayment Period (as defined
herein) will be distributed to Certificateholders as described herein. To the
extent that, as a result of a full or partial prepayment, a borrower is not
required to pay a full month's interest on the amount prepaid, a shortfall in
the amount available to make distributions of one month's interest on the
Certificates could result. The amount by which one month's interest at the Net
Mortgage Rate on a Mortgage Loan as to which a voluntary prepayment has been
made exceeds the amount of interest actually received in connection with such
prepayment is a "Prepayment Interest Shortfall."

     In contrast, in the case of a prepayment in full on a Mortgage Loan
serviced by Aurora Loan Services Inc. ("Aurora") made in the same month in
which such prepayment is distributed to Certificateholders, an excess of
interest at the Net Mortgage Rate, to the extent received, over one month's
interest (such excess, "Prepayment Interest Excess") could result.

     With respect to prepayments in full or in part, each Servicer (as defined
herein) is obligated to reduce the total of its Servicing Fees (as defined
herein) for the related Distribution Date to fund any resulting Prepayment
Interest Shortfalls, to the extent not offset (if applicable) by any Prepayment
Interest Excess for that month. The Master Servicer is not obligated to fund
any Prepayment Interest Shortfalls required to be paid but not paid by the
related Servicer. See "Servicing of the Mortgage Loans -- Prepayment Interest
Shortfalls" herein. Any Prepayment Interest Shortfalls not funded by the
Servicers ("Net Prepayment Interest Shortfalls") will be allocated among the
Senior Certificates and the Subordinate Certificates proportionately based on
the Accrued Certificate Interest otherwise distributable thereon.


CLASS A2 AUCTION

     During the five business days prior to the Distribution Date occurring on
the First Auction Distribution Date (as described herein), the Trustee or its
agent (the "Auction Administrator") will solicit at least three bids from
third-party bidders for purchase of the Callable Certificates for an amount not
less than the Minimum Call Price. If the Minimum Call Price is not received on
the First Auction Distribution Date, this process will be repeated every three
months until the Minimum Call Price is received. The Auction Administrator will
be reimbursed for the costs and expenses of the auction and sale before the
proceeds are distributed to the Callable Certificateholders. If the amount
received in the auction is greater than Minimum Call Price, such excess will be
paid to the holder of Class A3 Certificates. The "Minimum Call Price" will be
equal to the sum of (1) the outstanding principal balance of the Callable
Certificates after application of all principal distributions and realized
losses on the Auction Distribution Date, (2) accrued interest on the Callable
Certificates at the related interest rate from the first day of the month in
which the Auction Distribution Date occurs, up to but excluding the Auction
Distribution Date and (3) the costs and expenses incurred by the Auction
Administrator in conjunction with the auction. If you hold a Callable
Certificate on the Distribution Date with respect to which the Minimum Call
Price is received, your certificate will be transferred to the highest bidder
on that Distribution Date, thereby ending your investment in that certificate.
Holders of the Callable Certificates will receive par plus accrued interest on
the Auction Distribution


                                      S-23


Date that the Minimum Call Price is received. If the Minimum Call Price is not
received on the First Auction Distribution Date, the interest rate for the
Callable Certificates for each Distribution Date thereafter will increase to
5.36% (subject to a maximum rate equal to the Available Funds Cap). Thereafter,
the auction will be repeated every three months until the Minimum Call Price is
received. If the Minimum Call Price is received, the interest rate for the
Callable Certificates shall thereafter equal the Net WAC. Following the Auction
Distribution Date on which the Minimum Call Price is received and after the
Class Principal Amounts of the Class A1 and Class A2 Certificates have been
reduced to zero, the Class A2 Certificates shall receive all amounts of
interest and principal otherwise payable to the Class A3 Certificates until the
Class Principal Amount of the Class A3 Certificates has been reduced to zero.
The Class AIO Certificates will not be entitled to distributions of any kind
following the First Auction Distribution Date.

     Beginning with the first distribution date, the interest accrued on the
Class A3 Certificates will be distributed as principal first to the Class A1
Certificates, until the Class Principal Amount of the Class A1 Certificates is
reduced to zero and then to the Class A2 Certificates, until the Class
Principal Amount of the Class A2 Certificates is reduced to zero. The Class
Principal Amount of the Class A3 Certificates will be increased on each
Distribution Date by an amount equal to the interest accrued on the Class A3
Certificates for such Distribution Date to the extent such interest was
distributed as principal as described in the preceding sentence.


DISTRIBUTIONS OF PRINCIPAL

     Distributions of principal on the Certificates (other than the Class E and
Class P Certificates and the Interest-Only Certificates) will be made on each
Distribution Date in an aggregate amount equal to the Principal Distribution
Amount, to the extent of amounts available to make those payments in accordance
with the priorities set forth under "-- Priority of Distributions" above. The
"Principal Distribution Amount" for any Distribution Date will equal the sum of
(x) the Senior Principal Distribution Amount and (y) the Subordinate Principal
Distribution Amount for such date. In addition, as described herein, certain
amounts otherwise payable to the Class A3 Certificates as interest shall be
paid as principal to the Class A1 and Class A2 Certificates.

    o The "Senior Principal Distribution Amount" for each Distribution Date is
      equal to the sum of:

       (1) the product of (a) the Senior Percentage and (b) the principal
    portion of each Scheduled Payment (without giving effect to any Debt
    Service Reduction occurring prior to the Bankruptcy Coverage Termination
    Date (each as defined herein)) on each Mortgage Loan due during the
    related Due Period;

       (2) the product of (a) the Senior Prepayment Percentage and (b) each of
    the following amounts: (i) the principal portion of each full and partial
    principal prepayment made by a borrower on a Mortgage Loan during the
    related Prepayment Period, (ii) each other unscheduled collection,
    including any Subsequent Recovery, Insurance Proceeds and net Liquidation
    Proceeds (other than with respect to any Mortgage Loan that was finally
    liquidated during the related Prepayment Period), representing or
    allocable to recoveries of principal of Mortgage Loans received during the
    related Prepayment Period and (iii) the principal portion of all proceeds
    of the purchase (or, in the case of a permitted substitution, amounts
    representing a principal adjustment) of any Mortgage Loan actually
    received by the Trustee with respect to the related Prepayment Period;

       (3) with respect to unscheduled recoveries allocable to principal of any
    Mortgage Loan that was finally liquidated during the related Prepayment
    Period, the lesser of (a) the related net Liquidation Proceeds allocable
    to principal and (b) the product of the Senior Prepayment Percentage for
    that date and the remaining Scheduled Principal Balance of such Mortgage
    Loan at the time of liquidation; and

       (4) any amounts described in clauses (1) through (3) for any previous
    Distribution Date that remain unpaid.


                                      S-24


    o The "Scheduled Principal Balance" of any Mortgage Loan as of any date of
      determination is generally equal to its outstanding principal balance as
      of November 1, 2004 (the "Cut-off Date"), after giving effect to
      Scheduled Payments due on or before that date, reduced by (1) the
      principal portion of all Scheduled Payments due on or before the due date
      in the Due Period immediately preceding such date of determination,
      whether or not received, and (2) all amounts allocable to unscheduled
      principal payments received on or before the last day of the Prepayment
      Period immediately preceding such date of determination. The Scheduled
      Principal Balance of a Liquidated Mortgage Loan shall be equal to zero.

    o The "Senior Percentage" for any Distribution Date is the percentage
      equivalent of a fraction, the numerator of which is the sum of the Class
      Principal Amounts of the Classes of Senior Certificates (other than the
      Class AIO Certificates) immediately prior to that date and the
      denominator of which is the Pool Balance for the immediately preceding
      Distribution Date (or for the first Distribution Date, the sum of the
      Scheduled Principal Balance of each Mortgage Loan as of the Cut-off
      Date).

    o The "Pool Balance" for any Distribution Date is the sum of the Scheduled
      Principal Balance of each Mortgage Loan included in the Mortgage Pool for
      that Distribution Date.

    o The "Senior Prepayment Percentage" for any Distribution Date occurring
      during the five years beginning on the first Distribution Date will equal
      100%. Thereafter, the Senior Prepayment Percentage will, except as
      described below, be subject to gradual reduction as described in the
      following paragraph. This disproportionate allocation of certain
      unscheduled payments in respect of principal will have the effect of
      accelerating the amortization of the Senior Certificates, while, in the
      absence of Realized Losses, increasing the relative percentage interest
      in the Mortgage Loans evidenced by the Subordinate Certificates.
      Increasing the proportionate interest of the Subordinate Certificates
      relative to that of the Senior Certificates is intended to preserve the
      limited protection provided to the Senior Certificates by the
      subordination of the Subordinate Certificates.

    o The Senior Prepayment Percentage for any Distribution Date occurring on
      or after the fifth anniversary of the first Distribution Date will be as
      follows:

    o for any Distribution Date in the first year thereafter, the Senior
      Percentage plus 70% of the Subordinate Percentage for that Distribution
      Date;

    o for any Distribution Date in the second year thereafter, the Senior
      Percentage plus 60% of the Subordinate Percentage for that Distribution
      Date;

    o for any Distribution Date in the third year thereafter, the Senior
      Percentage plus 40% of the Subordinate Percentage for that Distribution
      Date;

    o for any Distribution Date in the fourth year thereafter, the Senior
      Percentage plus 20% of the Subordinate Percentage for that Distribution
      Date; and

    o for any subsequent Distribution Date, the Senior Percentage for that
      Distribution Date;

   provided, however, if on any Distribution Date the Senior Percentage
   exceeds the initial Senior Percentage, the Senior Prepayment Percentage for
   that Distribution Date will once again equal 100%.

     Notwithstanding the foregoing, no decrease in the Senior Prepayment
Percentage below the level in effect for the most recent prior period specified
above will be effective if, as of that Distribution Date as to which any such
decrease applies, (1) the average outstanding principal balance on that
Distribution Date and for the preceding five Distribution Dates of all Mortgage
Loans that were delinquent 60 days or more (including for this purpose any
Mortgage Loans in foreclosure or bankruptcy and Mortgage Loans with respect to
which the related Mortgaged Property has been acquired by the Trust Fund) is
greater than or equal to 50% of the Subordinate Amount (as defined herein)
immediately prior to such Distribution Date or (2) cumulative Realized Losses
with respect to the Mortgage Loans exceed (a) with respect to any Distribution
Date on or after the fifth anniversary


                                      S-25


but prior to the sixth anniversary of the first Distribution Date, 30% of the
Subordinate Amount as of the Cut-off Date (the "Original Subordinate Amount"),
(b) with respect to any Distribution Date on or after the sixth anniversary but
prior to the seventh anniversary of the first Distribution Date, 35% of the
Original Subordinate Amount, (c) with respect to any Distribution Date on or
after the seventh anniversary but prior to the eighth anniversary of the first
Distribution Date, 40% of the Original Subordinate Amount, (d) with respect to
any Distribution Date on or after the eighth anniversary but prior to the ninth
anniversary of the first Distribution Date, 45% of the Original Subordinate
Amount and (e) with respect to any Distribution Date on or after the ninth
anniversary of the first Distribution Date, 50% of the Original Subordinate
Amount. After the Class Principal Amount of each Class of Senior Certificates
has been reduced to zero, the Senior Prepayment Percentage will be zero.

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

       (1) the product of (a) the Subordinate Percentage and (b) the principal
    portion of each Scheduled Payment (without giving effect to any Debt
    Service Reduction occurring prior to the Bankruptcy Coverage Termination
    Date) on each Mortgage Loan due during the related Due Period;

       (2) the product of (a) the Subordinate Prepayment Percentage and (b)
    each of the following amounts: (i) the principal portion of each full and
    partial principal prepayment made by a borrower on a Mortgage Loan during
    the related Prepayment Period, (ii) each other unscheduled collection,
    including any Subsequent Recovery, Insurance Proceeds and net Liquidation
    Proceeds (other than with respect to any Mortgage Loan that was finally
    liquidated during the related Prepayment Period), representing or
    allocable to recoveries of principal of Mortgage Loans received during the
    related Prepayment Period and (iii) the principal portion of all proceeds
    of the purchase (or, in the case of a permitted substitution, amounts
    representing a principal adjustment) of any Mortgage Loan actually
    received by the Trustee with respect to the related Prepayment Period;

       (3) with respect to unscheduled recoveries allocable to principal of any
    Mortgage Loan that was finally liquidated during the related Prepayment
    Period, the related net Liquidation Proceeds allocable to principal to the
    extent not distributed pursuant to subsection (3) of the definition of
    Senior Principal Distribution Amount; and

       (4) any amounts described in clauses (1) through (3) for any previous
    Distribution Date that remain unpaid.

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

    o The "Subordinate Prepayment Percentage" for any Distribution Date is the
      difference between 100% and the Senior Prepayment Percentage for such
      date.

    o The "Subordinate Percentage" for any Distribution Date is the difference
      between 100% and the Senior Percentage for such date.

    o The "Subordinate Amount" for any Distribution Date is equal to the
      excess of the Pool Balance for the immediately preceding Distribution
      Date over the aggregate Class Principal Amount of the Senior Certificates
      immediately prior to that Distribution Date.

The Class AIO Certificates are Interest-Only Certificates; no principal will be
distributable on this Class. The Class AIO Certificates will not be entitled to
receive distributions of any kind following the First Auction Distribution
Date.

AVAILABLE DISTRIBUTION AMOUNT

     The due period (the "Due Period") related to each Distribution Date starts
on the second day of the month preceding the month in which such Distribution
Date occurs and ends on the first day of


                                      S-26


the month in which such Distribution Date occurs. For a prepayment in full (in
the case of Mortgage Loans serviced by Aurora), the "Prepayment Period" related
to each Distribution Date starts on the seventeenth day of the month preceding
the month in which such Distribution Date occurs and ends on the sixteenth day
of the month in which such Distribution Date occurs. In the case of Mortgage
Loans serviced by all other Servicers, for a prepayment in part or in full (and
in the case of Mortgage Loans serviced by Aurora, for a prepayment in part),
the "Prepayment Period" related to each Distribution Date is the calendar month
preceding the month in which such Distribution Date occurs. The "Servicer
Remittance Date" is the eighteenth day (or if such eighteenth day is not a
Business Day, the next succeeding Business Day) of the month in which the
related Distribution Date occurs. The "Deposit Date" is three Business Days
immediately preceding the related Distribution Date.

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

       (1) the total amount of all cash received by the Master Servicer from
    each Servicer through the Servicer Remittance Date immediately preceding
    such Distribution Date and remitted to the Trustee on the related Deposit
    Date, which includes (a) Scheduled Payments due on the Mortgage Loans
    during the related Due Period and collected prior to the related Servicer
    Remittance Date or advanced by the Master Servicer or the Servicers (or
    the Trustee as successor master servicer), (b) payments allocable to
    principal on the Mortgage Loans (other than Liquidation Proceeds and
    Insurance Proceeds) to the extent received in advance of their scheduled
    due dates and applied to reduce the principal balances of those Mortgage
    Loans ("Principal Prepayments"), together with accrued interest thereon,
    if any, identified as having been received on the Mortgage Loans during
    the applicable Prepayment Period, plus any amounts paid by any Servicer in
    respect of Prepayment Interest Shortfalls, in each case for such
    Distribution Date, (c) the proceeds of any repurchase of a Mortgage Loan
    repurchased by the Seller (as defined herein), the Depositor or any other
    party, including as a result of a breach of a representation or warranty
    or document defect, (d) any Prepayment Penalty Amounts (as defined herein)
    received with respect to the Mortgage Loans and (e) any Subsequent
    Recovery or recoveries through liquidation of any REO Property with
    respect to the Mortgage Loans, including Insurance Proceeds and
    Liquidation Proceeds, minus:

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


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

          (c) Liquidation Proceeds, Subsequent Recoveries and Insurance
        Proceeds received after the applicable Prepayment Period with respect
        to the Mortgage Loans;

          (d) all fees and other amounts due or reimbursable to the Master
        Servicer or the Trustee (or its custodian) pursuant to the Trust
        Agreement or to a Servicer pursuant to the related servicing agreement;
        and

          (e) any Prepayment Interest Excess, to the extent not offset by
        Prepayment Interest Shortfalls;

       (2) any other payments made by the Master Servicer, the Servicers, the
    Trustee as successor master servicer or the Depositor with respect to such
    Distribution Date.

    o "Insurance Proceeds" means all proceeds (net of unreimbursed payments of
      property taxes, insurance premiums and similar items incurred, and
      unreimbursed advances or servicing advances made by the Servicers or the
      Master Servicer (or the Trustee as successor master servicer), if any) of
      applicable insurance policies, to the extent such proceeds are not
      applied to the restoration of the Mortgaged Property or released to the
      borrower.


                                      S-27


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


    o "Subsequent Recovery" means any amount recovered by the related Servicer
      or the Master Servicer with respect to a Liquidated Mortgage Loan with
      respect to which a Realized Loss has been incurred after liquidation and
      disposition of such Mortgage Loan.


EXAMPLE OF DISTRIBUTIONS


     The following sets forth an example of distributions on the Certificates
for the Distribution Date in March 2005:





February 2 through
 March 1 .............. Due Period:                  Payments due during the related Due Period
                                                     (February 2 through March 1) from
                                                     borrowers will be deposited in each Servicer's
                                                     custodial account as received and will include
                                                     scheduled principal payments plus interest on
                                                     February 1 principal balances of the
                                                     Mortgage Loans.

February 1 through
 February 28 .......... Prepayment Period for        Partial principal prepayments received by any
                        partial and full             Servicer and principal prepayments in full
                        prepayments received         received by any Servicer (other than Aurora)
                        from Mortgage Loans          during the related Prepayment Period
                        (except full prepayments     (February 1 through February 28) will be
                        received by Aurora):         deposited into such Servicer's custodial
                                                     account for the remittance to the Master
                                                     Servicer on the Servicer Remittance Date
                                                     (March 18).

February 17 through
 March 16 ............. Prepayment Period for        Prepayments in full received during the
                        prepayments in full          related Prepayment Period (February 17
                        received from Mortgage       through March 16) from Mortgage Loans
                        Loans serviced by Aurora:    serviced by Aurora will be deposited into
                                                     Aurora's custodial account for remittance to
                                                     the Master Servicer on March 18.

February 28 ........... Record Date (except for      Distributions will be made to
                        Class A1 Certificates will   Certificateholders of record for all Classes
                        be March 24):                (except for the Class A1 Certificates) as of
                                                     the close of business on the last Business Day
                                                     of the month immediately before the month
                                                     in which the Distribution Date occurs. With
                                                     respect to the Class A1 Certificates,
                                                     distributions will be made to
                                                     Certificateholders of record as of the close of
                                                     business on the Business Day immediately
                                                     preceding the Distribution Date.


                                      S-28





March 18 ......... Servicer Remittance Date:   The Servicers will remit collections and
                                               recoveries in respect of the Mortgage Loans
                                               to the Master Servicer on or prior to the 18th
                                               day of each month (or if the 18th day is not a
                                               Business Day, the next succeeding Business
                                               Day), as specified in the related servicing
                                               agreement.

March 22 ......... Deposit Date:               Three Business Days immediately preceding
                                               the Distribution Date, the Master Servicer
                                               will remit to the Trustee the amount of
                                               principal and interest to be distributed to
                                               Certificateholders on March 25, including any
                                               Advances made by the Servicers or the
                                               Master Servicer for that Distribution Date.

March 25 ......... Distribution Date:          On the 25th day of each month (or if the
                                               25th day is not a Business Day, the next
                                               succeeding Business Day), the Trustee will
                                               make distributions to Certificateholders.


     Succeeding months follow the same pattern.


THE RESIDUAL CERTIFICATE

     In addition to distributions of principal and interest, the holder of the
Residual Certificate will be entitled to receive, generally (1) the amount, if
any, of any Available Distribution Amount remaining in each REMIC on any
Distribution Date after distributions of principal and interest are made on the
regular interests and on the Residual Certificate on that date and (2) the
proceeds, if any, of the assets of the Trust Fund remaining in each REMIC after
the principal amounts of the regular interests and of the Residual Certificate
have been reduced to zero. It is generally not anticipated that any material
assets will be remaining for distribution at any such time.

     The Trust Agreement will include certain restrictions on the transfer of
the Residual Certificate.

     See "Material Federal Income Tax Considerations" herein and in the
   accompanying Prospectus.


ALLOCATION OF REALIZED LOSSES

     If a Realized Loss (other than an Excess Loss) occurs on the Mortgage
Loans, then, on each Distribution Date, the principal portion of that Realized
Loss will be allocated first, to reduce the Class Principal Amount of each
Class of Subordinate Certificates, in inverse order of priority, until the
Class Principal Amount thereof has been reduced to zero (that is, such Realized
Losses will be allocated to the Class B6 Certificates while those Certificates
are outstanding, then to the Class B5 Certificates, and so forth) and second,
to the Senior Certificates, proportionately, on the basis of their respective
Class Principal Amounts.

     The principal portion of any Excess Loss (other than a Debt Service
Reduction) on a Mortgage Loan for any Distribution Date will be allocated
proportionately to the Senior Certificates and the Subordinate Certificates on
the basis of their respective Class Principal Amounts.

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

    o In general, a "Realized Loss" means (a) with respect to a Liquidated
      Mortgage Loan, the amount by which the remaining unpaid principal balance
      of that Mortgage Loan plus all


                                      S-29


      accrued and unpaid interest thereon and any related expenses exceeds the
      amount of Liquidation Proceeds applied to the principal balance of that
      Mortgage Loan, or (b) the amount by which, in the event of bankruptcy of
      a borrower, a bankruptcy court reduces the secured debt to the value of
      the related Mortgaged Property (a "Deficient Valuation"). In determining
      whether a Realized Loss is a loss of principal or of interest,
      Liquidation Proceeds and other recoveries on a Mortgage Loan will be
      applied first to outstanding expenses incurred with respect to such
      Mortgage Loan, then to accrued, unpaid interest, and finally to
      principal.

    o "Bankruptcy Losses" are losses that are incurred as a result of
      Deficient Valuations and any reduction, in a bankruptcy proceeding, of
      the amount of the Scheduled Payment on a Mortgage Loan other than as a
      result of a Deficient Valuation (a "Debt Service Reduction"). The
      principal portion of Debt Service Reductions will not be allocated in
      reduction of the Certificate Principal Amounts of any Certificates.

    o "Special Hazard Losses" are, in general terms, Realized Losses arising
      out of certain direct physical loss or damage to Mortgaged Properties
      that are not covered by a standard hazard insurance policy, but
      excluding, among other things, faulty design or workmanship and normal
      wear and tear.

    o "Fraud Losses" are losses sustained on a Liquidated Mortgage Loan by
      reason of a default arising from fraud, dishonesty or misrepresentation.

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

     The principal portion of Special Hazard Losses, Bankruptcy Losses (other
than Debt Service Reductions) and Fraud Losses on the Mortgage Loans that
exceed the "Special Hazard Loss Limit," "Bankruptcy Loss Limit," and "Fraud
Loss Limit," respectively ("Excess Losses"), will be allocated as described
above. The "Special Hazard Loss Limit" will initially be approximately
$4,029,935; the "Bankruptcy Loss Limit" will initially be approximately
$200,000; and the "Fraud Loss Limit" will initially be approximately
$6,453,375.

     The Special Hazard Loss Limit will be reduced, from time to time, to an
amount equal on any Distribution Date to the lesser of (a) the greatest of (1)
1% of the aggregate of the Scheduled Principal Balances of the Mortgage Loans,
(2) twice the Scheduled Principal Balance of the Mortgage Loan having the
highest Scheduled Principal Balance and (3) the aggregate Scheduled Principal
Balance of the Mortgage Loans secured by Mortgaged Properties located in the
single California postal zip code area having the highest aggregate Scheduled
Principal Balance of any such zip code area and (b) the Special Hazard Loss
Limit as of the Closing Date less the amount, if any, of Special Hazard Losses
incurred since the Closing Date.

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

     The Fraud Loss Limit will be reduced, from time to time, by the amount of
Fraud Losses allocated to the Certificates. In addition, on each anniversary of
the Cut-off Date, the Fraud Loss Limit will be reduced as follows: (a) on the
first through fourth anniversaries of the Cut-off Date, to an amount equal to
the lesser of (1) the Fraud Loss Limit as of the most recent anniversary of the
Cut-off Date and (2) 1% of the aggregate Scheduled Principal Balance of all the
Mortgage Loans as of the most recent anniversary of the Cut-off Date and (b) on
the fifth anniversary of the Cut-off Date, to zero.

FINAL SCHEDULED DISTRIBUTION DATE

     The "Final Scheduled Distribution Date" (which is the Distribution Date
succeeding the month of the scheduled maturity of the latest maturing Mortgage
Loan) for the Senior Certificates and the


                                      S-30


Subordinate Certificates (other than the Class AIO Certificates) is the
Distribution Date in January 2035. The actual final Distribution Date for each
such Class of Certificates may be earlier or later, and could be substantially
earlier, than the Final Scheduled Distribution Date. The Final Scheduled
Distribution Date for the Class AIO Certificates is the First Auction
Distribution Date.


OPTIONAL TERMINATION OF THE TRUST FUND


     On any Distribution Date after the date on which the total Scheduled
Principal Balance of the Mortgage Loans is less than 10% of the Cut-off Date
Balance of the Mortgage Loans, the Master Servicer (subject to the terms of the
Trust Agreement) will, with the prior written consent of the Seller (which
consent shall not be unreasonably withheld), have the option to purchase the
Mortgage Loans, any REO Property and any other property remaining in the Trust
Fund and thereby effect the termination of the Trust Fund and the retirement of
the Certificates. The purchase price of the Mortgage Loans must be equal to the
sum of (a) 100% of the total outstanding principal balance of the Mortgage
Loans, plus accrued interest thereon at the applicable Mortgage Rate through
the Due Date in the Due Period immediately preceding the Distribution Date in
which the optional purchase proceeds are distributed to the Certificateholders,
(b) the fair market value of all other property remaining in the Trust Fund
(reduced in the case of REO Property, by (1) reasonably anticipated disposition
costs and (2) any amount by which the fair market value as so reduced exceeds
the outstanding principal balance of the related Mortgage Loan) and (c) any
unreimbursed servicing advances for the related Distribution Date. This
purchase will be treated as a prepayment of the Mortgage Loans for purposes of
distributions to Certificateholders. Upon payment in full to Certificateholders
of these amounts, the Trust Fund will be terminated.


THE TRUSTEE


     Citibank, N.A. will be the Trustee under the Trust Agreement (in such
capacity, the "Trustee"). The Trustee will be entitled to retain as
compensation for its services, any interest or other income earned on funds on
deposit in the Certificate Account pending distribution to Certificateholders.
The Trustee will also be entitled to customary indemnification and
reimbursement for certain expenses prior to distributions of any amounts to
Certificateholders. The Trustee's "Corporate Trust Office" (i) for certificate
transfer purposes and for purposes of presentment and surrender of the
Certificates for the final distributions thereon is 111 Wall Street, 15th
Floor, New York, New York 10005, Attention:  15th Floor Window and (ii) for all
other purposes is 388 Greenwich Street, 14th Floor, New York, New York 10013,
Attention:  Agency and Trust SASCO 2004-22 or at such other addresses as the
Trustee may designate from time to time by notice to the Certificateholders,
the Depositor and the Master Servicer.


                                      S-31


                        DESCRIPTION OF THE MORTGAGE POOL

GENERAL

     Whenever reference is made herein to a percentage of some or all of the
Mortgage Loans, that percentage is determined (unless otherwise specified) on
the basis of the Scheduled Principal Balance of the Mortgage Loans as of the
Cut-off Date (the "Cut-off Date Balance").

     The Mortgage Pool will consist of approximately 615 conventional, fixed
rate, fully amortizing, first lien residential Mortgage Loans, all of which
have original terms to maturity from the first due date of the scheduled
monthly payment (a "Scheduled Payment") of 30 years and having a Cut-off Date
Balance (after giving effect to Scheduled Payments due on such date) of
approximately $322,668,769.

     Two of the Mortgage Loans (representing 0.37% of the Mortgage Loans) were
made to employees of the Underwriter or its affiliates (the "Employee Mortgage
Loans"). The Employee Mortgage Loans were originated at Mortgage Rates equal to
the then current interest rate for mortgage loans less 0.25% per annum (the
"Employee Discount Rate"). In the event the related borrower ceases to be an
employee of the Underwriter or its affiliates, the Mortgage Rate on such
Employee Mortgage Loan will increase by the amount of the Employee Discount
Rate. Interest on any Employee Mortgage Loan due to the application of the
Employee Discount Rate will be distributed to the Class E Certificates.

     The Mortgage Loans were acquired by Lehman Brothers Holdings Inc. ("Lehman
Holdings" or the "Seller") from various originators (various banks, savings and
loan and other mortgage lending institutions originating Mortgage Loans are
referred to herein as the "Originators"). The largest percentage of
originations (as a percentage of the Cut-off Date Balance) was made by Aurora,
in accordance with the Aurora Underwriting Guidelines (as defined herein)
(approximately 91.48%). The Aurora Underwriting Guidelines and the underwriting
guidelines generally applied by Originators other than Aurora in originating
the Mortgage Loans are described at "Underwriting Guidelines" below. The
Mortgage Loans will be acquired by the Depositor from the Seller and the
Depositor will, in turn, convey such Mortgage Loans to the Trust Fund. See "The
Trust Agreement -- Assignment of Mortgage Loans."

     Approximately 22.63%, 28.90% and 7.33% of the Mortgage Loans were
originated under "no documentation," "limited documentation" or "no ratio
documentation" programs, respectively, pursuant to which no information was
obtained regarding borrowers' income or employment and there was no
verification of the borrowers' assets. Certain documentation with respect to
some Mortgage Loans, including, in some cases, the related Mortgage Note,
Mortgage or title insurance policy, is unavailable. Except as otherwise noted
below, the Seller will make only limited representations and warranties with
respect to the Mortgage Loans; however, the Trust Fund will be able to enforce
the Seller's rights against the Originators for their representations and
warranties made with respect to the Mortgage Loans at the time of sale of the
Mortgage Loans to the Seller. See "Trust Agreement -- Assignment of Mortgage
Loans" herein.

     All of the Mortgage Loans are secured by first mortgages or deeds of trust
or other similar security instruments creating first liens on residential
properties (each, a "Mortgaged Property") consisting of one- to four-family
dwelling units, individual units in planned unit developments, individual
condominiums or shares issued by cooperative housing corporations and related
leasehold interests.

     Pursuant to its terms, each Mortgage Loan, other than a loan secured by a
condominium unit, is required to be covered by a standard hazard insurance
policy in an amount equal to the lower of the unpaid principal amount thereof
or the replacement value of the improvements on the Mortgaged Property.
Generally, a cooperative housing corporation or a condominium association is
responsible for maintaining hazard insurance covering the entire building. See
"Description of Mortgage and Other Insurance -- Hazard Insurance on the Loans
-- Standard Hazard Insurance Policies" in the Prospectus.


                                      S-32


     The "Loan-to-Value Ratio" of a Mortgage Loan at any time is the ratio of
the principal balance of the Mortgage Loan at the date of determination to (a)
in the case of a purchase, the lesser of the sale price of the Mortgaged
Property and its appraised value at the time of sale, or (b) in the case of a
refinance or modification, the appraised value of the Mortgaged Property at the
time of the refinance or modification.


     As of the Cut-off Date, approximately $449,080 of the Mortgage Loans,
representing approximately 0.14% of the Mortgage Loans, were one Scheduled
Payment delinquent. As of the Cut-off Date, none of the Mortgage Loans was two
Scheduled Payments or more delinquent.


     As of the Cut-off Date, none of the Mortgage Loans in the Trust Fund will
be "high cost" loans under any applicable federal, state or local
anti-predatory or anti-abusive lending laws.


THE MORTGAGE LOANS


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





      Number of Mortgage Loans ........................................             615
      Total Scheduled Principal Balance ............................... $ 322,668,769.23
      Mortgage Rates:
        Weighted Average ..............................................            5.882%
        Range ......................................................... 4.625% to 6.125%
      Weighted Average Remaining Term to Maturity (in months) .........             359



     The Scheduled Principal Balances of the Mortgage Loans range from
approximately $334,000 to approximately $1,820,000. The Mortgage Loans have an
average Scheduled Principal Balance of approximately $524,665.


     The weighted average Loan-to-Value Ratio at origination of the Mortgage
Loans is approximately 64.20%, and no Mortgage Loan had a Loan-to-Value Ratio
at origination exceeding approximately 90.00%.


     Approximately 91.48% of the Mortgage Loans were originated in accordance,
generally, with the Aurora Underwriting Guidelines and approximately 97.14% of
the Mortgage Loans will be initially serviced by Aurora. See "Underwriting
Guidelines" and "The Servicers."


     No more than approximately 1.25% of the Mortgage Loans are secured by
Mortgaged Properties located in any one zip code area.


     Approximately 39.95% of the Mortgage Loans are subject to prepayment
penalties in the first four months to five years after origination.


     All of the Mortgage Loans have an original term to stated maturity of 360
months.


     All of the Mortgage Loans are secured by properties in California.


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


                                      S-33


                         ORIGINAL LOAN-TO-VALUE RATIOS




                                                                         PERCENTAGE OF
                                                                        MORTGAGE LOANS
                                                       TOTAL               BY TOTAL
     RANGE OF ORIGINAL           NUMBER OF           SCHEDULED             SCHEDULED
 LOAN-TO-VALUE RATIOS (%)     MORTGAGE LOANS     PRINCIPAL BALANCE     PRINCIPAL BALANCE
--------------------------   ----------------   -------------------   ------------------

10.01 to 20.00 ...........            1          $     382,559.12             0.12%
20.01 to 30.00 ...........            7              3,503,935.36             1.09
30.01 to 40.00 ...........           21             11,662,188.70             3.61
40.01 to 50.00 ...........           60             34,398,834.65            10.66
50.01 to 60.00 ...........          120             65,872,329.94            20.41
60.01 to 70.00 ...........          174             93,075,747.07            28.85
70.01 to 80.00 ...........          230            113,049,082.72            35.04
80.01 to 90.00 ...........            2                724,091.67             0.22
                                    ---          ----------------           ------
 Total ...................          615          $ 322,668,769.23           100.00%
                                    ===          ================           ======


   The weighted average original Loan-to-Value Ratio is approximately 64.20%.


                                 MORTGAGE RATES




                                                                           PERCENTAGE OF
                                                                          MORTGAGE LOANS
                                                         TOTAL               BY TOTAL
          RANGE OF                 NUMBER OF           SCHEDULED             SCHEDULED
     MORTGAGE RATES (%)         MORTGAGE LOANS     PRINCIPAL BALANCE     PRINCIPAL BALANCE
----------------------------   ----------------   -------------------   ------------------

4.50001 to 5.00000 .........            4          $   1,734,932.00             0.54%
5.00001 to 5.50000 .........           26             13,951,420.34             4.32
5.50001 to 6.00000 .........          516            272,012,797.51            84.30
6.00001 to 6.50000 .........           69             34,969,619.38            10.84
                                      ---          ----------------           ------
 Total .....................          615          $ 322,668,769.23           100.00%
                                      ===          ================           ======


   The weighted average Mortgage Rate is approximately 5.882% per annum.


                          REMAINING TERMS TO MATURITY




                                                                            PERCENTAGE OF
                                                                           MORTGAGE LOANS
                                                          TOTAL               BY TOTAL
 RANGE OF REMAINING TERMS TO        NUMBER OF           SCHEDULED             SCHEDULED
      MATURITY (MONTHS)          MORTGAGE LOANS     PRINCIPAL BALANCE     PRINCIPAL BALANCE
-----------------------------   ----------------   -------------------   ------------------

341 to 360 ..................   615                 $ 322,668,769.23            100.00%
                                ---                 ----------------            ------
 Total ......................   615                 $ 322,668,769.23            100.00%
                                ===                 ================            ======


     The weighted average remaining term to maturity is approximately 359
months.

                                      S-34


                   CUT-OFF DATE SCHEDULED PRINCIPAL BALANCES




                                                                                     PERCENTAGE OF
                                                                                    MORTGAGE LOANS
                                                                   TOTAL               BY TOTAL
         RANGE OF CUT-OFF DATE               NUMBER OF           SCHEDULED             SCHEDULED
   SCHEDULED PRINCIPAL BALANCES ($)       MORTGAGE LOANS     PRINCIPAL BALANCE     PRINCIPAL BALANCE
--------------------------------------   ----------------   -------------------   ------------------

  300,000.01 to   350,000.00 .........           18          $   6,213,146.62             1.93%
  350,000.01 to   400,000.00 .........          137             52,175,863.03            16.17
  400,000.01 to   450,000.00 .........          124             52,957,092.69            16.41
  450,000.01 to   500,000.00 .........           88             42,004,276.81            13.02
  500,000.01 to   550,000.00 .........           51             26,595,509.60             8.24
  550,000.01 to   600,000.00 .........           54             31,189,678.00             9.67
  600,000.01 to   650,000.00 .........           58             37,119,429.34            11.50
  650,000.01 to   700,000.00 .........           16             10,905,624.18             3.38
  700,000.01 to   750,000.00 .........           10              7,403,850.00             2.29
  750,000.01 to   800,000.00 .........           12              9,368,056.61             2.90
  800,000.01 to   850,000.00 .........           11              9,123,954.85             2.83
  850,000.01 to   900,000.00 .........           11              9,757,950.62             3.02
  900,000.01 to   950,000.00 .........            4              3,746,445.91             1.16
  950,000.01 to 1,000,000.00 .........           13             12,849,156.52             3.98
1,000,000.01 to 1,250,000.00 .........            2              2,370,000.00             0.73
1,250,000.01 to 1,500,000.00 .........            4              5,567,212.58             1.73
1,500,000.01 to 1,750,000.00 .........            1              1,501,521.87             0.47
1,750,000.01 to 2,000,000.00 .........            1              1,820,000.00             0.56
                                                ---          ----------------           ------
 Total ...............................          615          $ 322,668,769.23           100.00%
                                                ===          ================           ======


     The average Cut-off Date Scheduled Principal Balance is approximately
$524,665.


                                 PROPERTY TYPE




                                                                                 PERCENTAGE OF
                                                                                MORTGAGE LOANS
                                                               TOTAL               BY TOTAL
                                         NUMBER OF           SCHEDULED             SCHEDULED
           PROPERTY TYPE              MORTGAGE LOANS     PRINCIPAL BALANCE     PRINCIPAL BALANCE
----------------------------------   ----------------   -------------------   ------------------

Single Family ....................          442          $  232,543,906.15           72.07%
Planned Unit Development .........          102              52,171,894.81           16.17
Two- to Four-Family ..............           37              22,774,010.89            7.06
Condominium ......................           34              15,178,957.38            4.70
                                            ---          -----------------          ------
 Total ...........................          615          $  322,668,769.23          100.00%
                                            ===          =================          ======


                                  LOAN PURPOSE




                                                                            PERCENTAGE OF
                                                                           MORTGAGE LOANS
                                                          TOTAL               BY TOTAL
                                    NUMBER OF           SCHEDULED             SCHEDULED
         LOAN PURPOSE            MORTGAGE LOANS     PRINCIPAL BALANCE     PRINCIPAL BALANCE
-----------------------------   ----------------   -------------------   ------------------

Cash Out Refinance ..........   235                 $  129,209,231.06           40.04%
Purchase ....................   227                    114,487,846.84           35.48
Rate/Term Refinance .........   153                     78,971,691.33           24.47
                                ---                 -----------------          ------
 Total ......................   615                 $  322,668,769.23          100.00%
                                ===                 =================          ======


                                      S-35


                              LOAN DOCUMENTATION




                                                                              PERCENTAGE OF
                                                                             MORTGAGE LOANS
                                                            TOTAL               BY TOTAL
                                      NUMBER OF           SCHEDULED             SCHEDULED
       LOAN DOCUMENTATION          MORTGAGE LOANS     PRINCIPAL BALANCE     PRINCIPAL BALANCE
-------------------------------   ----------------   -------------------   ------------------

Full Documentation ............          255          $  132,744,474.67           41.14%
Limited Documentation .........          180              93,258,371.35           28.90
No Documentation ..............          139              73,021,394.54           22.63
No Ratio ......................           41              23,644,528.67            7.33
                                         ---          -----------------          ------
 Total ........................          615          $  322,668,769.23          100.00%
                                         ===          =================          ======


                                OCCUPANCY STATUS




                                                                     PERCENTAGE OF
                                                                    MORTGAGE LOANS
                                                   TOTAL               BY TOTAL
                             NUMBER OF           SCHEDULED             SCHEDULED
   OCCUPANCY STATUS       MORTGAGE LOANS     PRINCIPAL BALANCE     PRINCIPAL BALANCE
----------------------   ----------------   -------------------   ------------------

Primary Home .........          548          $  289,199,283.69           89.63%
Investment ...........           55              26,782,553.84            8.30
Second Home ..........           12               6,686,931.70            2.07
                                ---          -----------------          ------
 Total ...............          615          $  322,668,769.23          100.00%
                                ===          =================          ======


                        PREPAYMENT PENALTY TERM (YEARS)




                                                                                PERCENTAGE OF
                                                                               MORTGAGE LOANS
                                                              TOTAL               BY TOTAL
                                        NUMBER OF           SCHEDULED             SCHEDULED
 PREPAYMENT PENALTY TERM (YEARS)     MORTGAGE LOANS     PRINCIPAL BALANCE     PRINCIPAL BALANCE
---------------------------------   ----------------   -------------------   ------------------

No Penalty ......................          376          $  193,766,499.41           60.05%
0.333 ...........................           16               7,420,024.46            2.30
0.417 ...........................            4               2,219,486.68            0.69
0.500 ...........................           12               6,924,800.81            2.15
0.583 ...........................            9               5,496,618.83            1.70
0.667 ...........................           23              11,557,122.22            3.58
1.000 ...........................            4               2,187,374.74            0.68
3.000 ...........................           32              15,598,115.97            4.83
5.000 ...........................          139              77,498,726.11           24.02
                                           ---          -----------------          ------
 Total ..........................          615          $  322,668,769.23          100.00%
                                           ===          =================          ======



                                      S-36


                            UNDERWRITING GUIDELINES

     The Mortgage Loans have been originated or acquired by the various
Originators or their correspondents in accordance with such Originator's
underwriting standards and guidelines (each, the "Underwriting Guidelines").
Approximately 91.48% of the Mortgage Loans were originated or acquired in
accordance with the Underwriting Guidelines established by Aurora (the "Aurora
Underwriting Guidelines"). The remainder of the Mortgage Loans included in the
Trust Fund were originated by various third-party originators in accordance
with the Underwriting Guidelines established by each of them which are
described below under "-- General Underwriting Guidelines" (the "General
Underwriting Guidelines"). Such General Underwriting Guidelines differ among
the various Originators in various areas. The following are general summaries
of the Aurora Underwriting Guidelines and the General Underwriting Guidelines
believed by the Depositor to be generally applied, with some variation, by
Aurora or the other Originators, as applicable. This discussion, however, does
not purport to be a complete description of the underwriting standards of any
of the Originators.

AURORA UNDERWRITING GUIDELINES

     The Aurora Underwriting Guidelines are generally not as strict as Fannie
Mae or Freddie Mac guidelines. The Aurora Underwriting Guidelines are intended
to evaluate the value and adequacy of the mortgaged property as collateral and
to consider the borrower's credit standing and repayment ability. On a
case-by-case basis, Aurora may determine that, based upon compensating factors,
a prospective borrower not strictly qualifying under the applicable
underwriting guidelines warrants an underwriting exception. Compensating
factors may include, but are not limited to, low loan-to-value ratios, low
debt-to-income ratios, good credit history, stable employment, financial
reserves, and time in residence at the applicant's current address. A
significant number of the Mortgage Loans may represent underwriting exceptions.


     The Aurora Underwriting Guidelines are applied in accordance with a
procedure that generally requires (1) an appraisal of the mortgaged property
(and generally, in the case of a mortgaged property with a loan amount
exceeding $650,000, two appraisals), by qualified independent appraisers, that
conforms to Fannie Mae and Freddie Mac standards and (2) a review of such
appraisal by Aurora and, depending upon the original principal balance and
loan-to-value ratio of the mortgaged property, may include a field review of
the original appraisal by another independent appraiser. Each appraisal
includes a market data analysis based on recent sales of comparable homes in
the area and a replacement cost analysis based on the current cost of
constructing a similar home. The Aurora Underwriting Guidelines generally
permit mortgage loans with loan-to-value ratios at origination of up to 103%
(or, with respect to certain mortgage loans, up to 95%) for the highest
credit-grading category, depending on the creditworthiness of the borrower, the
type and use of the property, the debt-to-income ratio and the purpose of the
loan application.

     Each prospective borrower completes an application that includes
information with respect to the applicant's liabilities, income (except with
respect to certain "no documentation" mortgage loans described below) and
employment history, as well as certain other personal information. Each
originator requires a credit report on each applicant from a credit reporting
company. The report typically contains information relating to matters such as
credit history with local and national merchants and lenders, installment debt
payments and any record of defaults, bankruptcy, repossession, suits or
judgments.

     In general, a substantial majority of the mortgage loans originated or
acquired by Aurora were originated consistent with and generally conform to
"full documentation," "limited documentation," or "no ratio documentation"
residential loan programs.

     Verification of employment, income and assets in a mortgage loan file is
dependent on the documentation program. For "full documentation" program loans,
documentation consistent with Fannie Mae/Freddie Mac guidelines is required,
which generally includes verification of current employment, a two-year history
of previous employment (or for self-employed borrowers, two years of income tax
returns), verification through deposit verifications of sufficient liquid
assets for down


                                      S-37


payments, closing costs and reserves, and depository account statements or
settlement statements documenting the funds received from the sale of the
previous home. For "limited documentation" program loans, current employment is
verified, a two-year history of previous employment is required, qualifying
income is based on the stated amount provided by the prospective borrower, and
deposit verifications are made to ensure sufficient liquid assets. "No ratio"
program loans require verification of current employment, a minimum of two
years' history of previous employment and verification of sufficient liquid
assets. Verification of the source of funds (if any) required to be deposited
by the applicant into escrow in the case of a purchase money loan is generally
required under all program guidelines (except for no documentation program
guidelines).


     Certain of the Mortgage Loans originated by Aurora were originated or
acquired under "no documentation" program guidelines, pursuant to which no
information was obtained regarding the borrowers' income or employment and
there was no verification of the borrowers' assets. The no documentation
program guidelines require stronger credit profiles than the other loan
programs, and have substantially more restrictive requirements for loan
amounts, loan-to-value ratios and occupancy.


     Substantially all of the Mortgage Loans originated by Aurora will be
initially serviced by Aurora. For a description of Aurora, see "The Master
Servicer" herein.


GENERAL UNDERWRITING GUIDELINES


     The General Underwriting Guidelines applied by Originators other than
Aurora are generally not as strict as Fannie Mae or Freddie Mac guidelines. The
General Underwriting Guidelines are intended to evaluate the value and adequacy
of the mortgaged property as collateral and to consider the borrower's credit
standing and repayment ability. On a case by-case basis, the Originators may
determine that, based upon compensating factors, a prospective borrower not
strictly qualifying under the applicable underwriting guidelines warrants an
underwriting exception. Compensating factors may include, but are not limited
to, relatively low loan-to-value ratios, relatively low debt to-income ratios,
good credit history, stable employment, financial reserves, and time in
residence at the applicant's current address. A significant number of the
Mortgage Loans originated by the Originators may represent such underwriting
exceptions.


     The General Underwriting Guidelines are applied in accordance with a
procedure that generally requires (1) an appraisal of the mortgaged property by
qualified independent appraisers (and in cases of certain high balance mortgage
loans, two appraisals) that conform to Fannie Mae and Freddie Mac standards and
(2) a review of such appraisal, which review may be conducted by the
Originator's staff appraiser or representative and, depending on the amount of
property data available, the original principal balance and loan-to-value ratio
of the mortgaged property, may include a field review of the original appraisal
(or a drive-by review appraisal) by another independent appraiser. Such
appraisal will generally include a market data analysis based on recent sales
of comparable homes in the area and a replacement cost analysis based on the
Current cost of constructing a similar home. The General Underwriting
Guidelines generally permit mortgage loans with loan-to-value ratios at
origination of up to 90% (or, with respect to certain Mortgage Loans, up to
100%) for the highest credit grading category, depending on the
creditworthiness of the borrower, and, in some cases, the type and use of the
property, the debt-to-income ratio and the purpose of the loan application.
Under the General Underwriting Guidelines, the amount in combined loan-to-value
ratio for purchase among mortgage loans may differ from these applicable to
refinancings.


     Each prospective borrower completes an application that includes
information with respect to the applicant's liabilities, income (except with
respect to certain "no documentation" mortgage loans described below) and
employment history, as well as certain other personal information. Each
Originator requires a credit report on each applicant from a credit reporting
company. The report typically contains information relating to matters such as
credit history with local and national merchants and lenders, installment debt
payments and any record of defaults, bankruptcy, repossession, suits or
judgments.


                                      S-38


     In general, a substantial majority of the Mortgage Loans originated under
the General Underwriting Guidelines were originated consistent with and
generally conform to "full documentation," "limited documentation," "no ratio
documentation" or "no documentation" residential loan programs.

     Verification of employment, income and assets in a Mortgage Loan file is
dependent on the documentation program. For "full documentation" program loans,
documentation substantially consistent with Fannie Mae/Freddie Mac guidelines
is required, which generally includes verification of current employment, a two
year history of previous employment (or for self-employed borrowers, two years
of income tax returns), verification through deposit verifications of
sufficient liquid assets for down payments, closing costs and reserves, and
depository account statements or settlement statements documenting the funds
received from the sale of the previous home. For "limited documentation"
program loans, current employment is verified, a two year history of previous
employment is required, qualifying income is based on the stated amount
provided by the prospective borrower, and deposit verifications are made to
ensure sufficient liquid assets. "No ratio documentation" program loans require
verification of current employment, a minimum of two years' history of previous
employment and verification of sufficient liquid assets, although generally
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. Verification of the
source of funds (if any) required to be deposited by the applicant into escrow
in the case of a purchase money loan is generally required under all program
guidelines (except for no documentation program guidelines).

     Certain of the Mortgage Loans were originated or acquired by the
Originators under "no documentation" program guidelines, pursuant to which no
information was obtained regarding the borrowers' income or employment and
there was no verification of the borrowers' assets. The no documentation
program guidelines require stronger credit profiles than the other loan
programs, and have substantially more restrictive requirements for loan
amounts, loan-to-value ratios and occupancy requirements.


                            ADDITIONAL INFORMATION

     The description in this Prospectus Supplement of the Mortgage Pool and the
Mortgaged Properties is based upon the Mortgage Pool as constituted at the
close of business on the Cut-off Date, as adjusted for Scheduled Payments due
on or before that date. A Current Report on Form 8-K will be filed, together
with the Trust Agreement and other material transaction documents, with the
Securities and Exchange Commission within fifteen days after the initial
issuance of the Offered Certificates. In the event that Mortgage Loans are
removed from or added to the Mortgage Pool as described under "Description of
the Mortgage Pool," such removal or addition, to the extent material, will be
noted in the Current Report on Form 8-K.


                              THE MASTER SERVICER

     The information in this section has been provided by Aurora Loan Services
Inc. ("Aurora" or the "Master Servicer"), and none of the Depositor, the
Trustee, the Seller, the Underwriter or any other Servicer makes any
representation or warranty as to the accuracy or completeness of this
information.

     Aurora is a wholly owned subsidiary of Lehman Brothers Bank, FSB engaged
principally in the business of (i) originating, purchasing and selling
residential mortgage loans in its own name and through its affiliates, (ii)
servicing residential mortgage loans for its own account, (iii) master
servicing residential mortgage loans for the account of its affiliates and (iv)
servicing and subservicing residential mortgage loans for the account of its
affiliates and others.

     Aurora's executive offices and centralized real estate master servicing
facility are located at 10350 Park Meadows Drive, Littleton, Colorado 80124,
and its centralized real estate loan servicing facility is located at 601 Fifth
Avenue, Scottsbluff, Nebraska 69361. Aurora has been approved to service
mortgage loans for Ginnie Mae, Fannie Mae and Freddie Mac.


                                      S-39


     As of September 30, 2004, Aurora's total loan servicing and subservicing
portfolio included loans with total outstanding principal balance of
approximately $48.39 billion, of which the substantial majority are subserviced
for Lehman Brothers Holdings Inc. and Lehman Brothers Bank, FSB ("Lehman
Bank"). The following table sets forth certain information regarding the
delinquency and foreclosure experience of Aurora with respect to mortgage loans
other than mortgage loans guaranteed by the FHA or VA. The indicated periods of
delinquency are based on the number of days past due on a contractual basis.


                         DELINQUENCIES AND FORECLOSURES
                             (DOLLARS IN MILLIONS)






                                                                        AS OF DECEMBER 31,                      AS OF
                                                        --------------------------------------------------  SEPTEMBER 30,
                                                            2000        2001         2002         2003          2004
                                                        ----------- ------------ ------------ ------------ --------------

Total balance of mortgage
 loans serviced .......................................   $ 4,598     $ 10,490     $ 21,196     $ 43,455      $ 43,343
Percentage of mortgage loans delinquent
 by period of delinquency(1)(2)(3)
 30 to 59 days ........................................      4.30%        3.43%        3.37%        1.87%         1.49%
 60 to 89 days ........................................      1.10%        1.33%        1.28%        0.43%         0.36%
 90 days or more ......................................      0.45%        1.23%        2.36%         .51%         0.45%
                                                          -------     --------     --------     --------      --------
Total percentage of mortgage
 loans delinquent(1)(2)(3) ............................      5.85%        5.99%        7.00%        2.81%         2.30%
In foreclosure (excluding bankruptcies)(1)(2) .........      1.10%        0.91%        0.75%        1.24%         0.94%
In bankruptcy(1)(2) ...................................      1.05%        0.67%        0.54%        0.38%         0.36%
                                                          -------     --------     --------     --------      --------
Total(4) ..............................................      8.00%        7.57%        8.29%        4.43%         3.60%
                                                          =======     ========     ========     ========      ========


----------
(1)   Total portfolio and delinquency information is for conventional loans and
      subprime loans only, excluding bankruptcies.


(2)   For all periods ended December 31, 2000, 2001, and 2002, the percentages
      are based on the average principal balances of the mortgage loans. For
      all subsequent periods, the percentages are based on the actual principal
      balance of each mortgage loan.


(3)   The MBS method for conventional loans and the ABS method for subprime
      loans are used in calculation of delinquency percentage. Under the MBS
      methodology, a loan is considered delinquent if any payment is past due
      one or more days. In contrast, under the ABS methodology, a loan is
      considered delinquent if any payment is past due 30 days or more. The
      period of delinquency is based upon the number of days that payments are
      contractually past due (assuming 30-day months). Consequently, under the
      ABS methodology, a loan due on the first day of a month is not 30 days
      delinquent until the first day of the next month.


(4)   Actual percentages are utilized in generating this table but due to
      rounding may not correspond exactly with total percentages.


     The above delinquency and foreclosure statistics represent the recent
experience of Aurora. The loans in Aurora's servicing portfolio may differ
significantly from the Mortgage Loans. The actual loss and delinquency
experience on the Mortgage Loans will depend, among other things, on the value
of the Mortgaged Properties securing such Mortgage Loans and the ability of
borrowers to make required payments. There can be no assurance, and no
representation is made, that the delinquency experience with respect to the
Mortgage Loans will be similar to that reflected in the tables above, nor is
any representation made as to the rate at which losses may be experienced on
liquidation of defaulted Mortgage Loans.

     The likelihood that borrowers will become delinquent in the payment of
their mortgage loans and the rate of any subsequent foreclosures may be
affected by a number of factors related to borrowers' personal circumstances,
including, for example, unemployment or change in employment (or in the case of
self-employed borrowers or borrowers relying on commission income, fluctuations
in income), marital separation and a borrower's equity in the related mortgaged
property. In addition, delinquency and foreclosure experience may be sensitive
to adverse economic conditions, either nationally or regionally, may exhibit
seasonal variations and may be influenced by the level of interest rates and


                                      S-40


servicing decisions on the applicable mortgage loans. Regional economic
conditions (including declining real estate values) may particularly affect
delinquency and foreclosure experience on mortgage loans to the extent that
mortgaged properties are concentrated in certain geographic areas.

     As Master Servicer, Aurora will monitor the performance of the primary
Servicers of the Mortgage Loans (see "The Servicers" below) in accordance with
the provisions of the underlying servicing agreements and the Trust Agreement.
Aurora will not, however, be ultimately responsible for the servicing of the
Mortgage Loans (other than for those Mortgage Loans for which Aurora also acts
in the capacity of a primary Servicer), except to the extent described under
"Servicing of the Mortgage Loans" below.


                                 THE SERVICERS


GENERAL

     The Mortgage Loans included in the Trust Fund will initially be serviced
by Aurora, Colonial Savings, F.A. ("Colonial Savings"), Chase Manhattan
Mortgage Corporation, First National Bank of Nevada and Wachovia Mortgage
Corporation. Aurora will service approximately 97.14% (as a percentage of
Cut-off Date Balance) of the Mortgage Loans. It is expected that the Mortgage
Loans serviced by First National Bank of Nevada will be serviced by Aurora
beginning on January 2, 2005. Substantially all of the Mortgage Loans serviced
by Aurora may be subject to a servicing transfer at any time. The Servicers
will, with certain exceptions, have primary responsibility for servicing the
Mortgage Loans including, but not limited to, all collection, advancing and
loan-level reporting obligations, maintenance of escrow accounts, maintenance
of insurance and enforcement of foreclosure proceedings with respect to the
Mortgage Loans and the related Mortgaged Properties. Such responsibilities will
be performed under the supervision of the Master Servicer in each case in
accordance with the provisions of the related servicing agreement. Under each
servicing agreement, the Master Servicer is obligated to terminate the Servicer
for certain events of default which indicate the Servicer is not performing, or
is unable to perform, its duties and obligations under the related servicing
agreement. In addition, under each servicing agreement, Lehman Holdings has
retained the right to terminate the Servicer, without cause and upon the notice
requirement set forth in the applicable servicing agreement and, in the case of
Colonial Savings, the payment of certain fees and expenses of the Servicer in
connection with the transfer of the Mortgage Loans to a successor servicer.


                        SERVICING OF THE MORTGAGE LOANS


GENERAL

     Notwithstanding anything to the contrary in the Prospectus, the Master
Servicer will not be ultimately responsible for the performance of the
servicing activities by a Servicer, except as described under "-- Servicing
Compensation and Payment of Expenses" and "Advances" below. If any Servicer
fails to fulfill its obligations under the applicable servicing agreement, the
Master Servicer is obligated to terminate that Servicer and appoint a successor
servicer as provided in the Trust Agreement.

     The Seller retains the right under the related servicing agreement to
transfer the servicing of the related Mortgage Loans to one or more successor
servicers at any time with 30 days' notice, without cause, subject to the
conditions set forth in the Trust Agreement and the related servicing
agreement, including the requirements that any such successor servicer be
qualified to service mortgage loans for Freddie Mac or Fannie Mae and, if the
successor servicer is not at that time already a Servicer of Mortgage Loans for
the Trust Fund, that each Rating Agency (as defined herein) confirm in writing
that the transfer of servicing will not result in a qualification, withdrawal
or downgrade of the then-current ratings of any of the Certificates.


SERVICING COMPENSATION AND PAYMENT OF EXPENSES

     As compensation for master servicing, the Master Servicer is entitled each
month to retain all investment earnings on amounts on deposit in the Collection
Account established by the Master


                                      S-41


Servicer prior to their remittance to the Trustee on the date which occurs
three business days before the related Distribution Date (the "Master Servicing
Fee"). Each Servicer will be paid a monthly fee (a "Servicing Fee") with
respect to each Mortgage Loan serviced by it calculated as 0.250% annually (the
"Servicing Fee Rate") of the outstanding principal balance of each related
Mortgage Loan as of the first day of the related Due Period.

     Each Servicer will also be entitled to receive, to the extent provided in
the applicable servicing agreement, additional compensation in the form of (1)
any interest or other income earned on funds it has deposited in a custodial
account pending remittance to the Master Servicer; (2) certain customary fees
and charges paid by borrowers (excluding the Prepayment Penalty Amounts
received with respect to the Mortgage Loans) and (3) any Prepayment Interest
Excess to the extent not offset by Prepayment Interest Shortfalls.

     The Servicing Fees are subject to reduction as described below under "--
Prepayment Interest Shortfalls." See "Servicing of Loans -- Servicing
Compensation and Payment of Expenses" in the Prospectus for information
regarding expenses payable by the Master Servicer and the Servicers. The Master
Servicer and the Servicers will be entitled to reimbursement for certain
expenses prior to distribution of any amounts to Certificateholders. See
"Collection Procedures; Escrow Accounts -- Servicing Compensation and Payment
of Expenses" in the Prospectus.


PREPAYMENT INTEREST SHORTFALLS

     When a borrower prepays a Mortgage Loan in full or in part between
Scheduled Payment dates, the borrower pays interest on the amount prepaid only
from the last Scheduled Payment date to the date of prepayment (or to the first
day of the applicable month, in the case of certain prepayments), with a
resulting reduction in interest payable for the month during which the
prepayment is made. Any Prepayment Interest Shortfall is generally required to
be paid by the applicable Servicer, but only to the extent that such amount is
not offset by Prepayment Interest Excess and does not exceed the total of the
Servicing Fees on the Mortgage Loans serviced by it for the applicable
Distribution Date. The Master Servicer is not required to fund any Prepayment
Interest Shortfall required to be funded but not funded by the Servicers or a
successor servicer as discussed herein.


ADVANCES

     Each Servicer will generally be obligated to make advances with respect to
delinquent payments of principal and interest on the Mortgage Loans adjusted to
the related Mortgage Rate less the applicable Servicing Fee Rate (an "Advance")
to the extent that such Advances, in its judgment, are reasonably recoverable
from future payments and collections, insurance payments or proceeds of
liquidation of a Mortgage Loan. The Master Servicer will be obligated in its
capacity as successor servicer to make any such Advances if any Servicer fails
to do so, and the Trustee (solely in its capacity as successor master servicer)
will be obligated to make any required Advance if the Master Servicer fails in
its obligation to do so, to the extent provided in the Trust Agreement. The
Master Servicer, each Servicer or the Trustee, in its capacity as successor
master servicer, as applicable, will be entitled to recover any Advances made
by it with respect to a Mortgage Loan out of late payments thereon or out of
related liquidation and insurance proceeds or, if those amounts are
insufficient, from collections on other Mortgage Loans. Such reimbursements may
result in Realized Losses.

     The purpose of making these Advances is to maintain a regular cash flow to
the Certificateholders, rather than to guarantee or insure against losses. No
party will be required to make any Advances with respect to reductions in the
amount of the monthly payments on Mortgage Loans due to reductions made by a
bankruptcy court in the amount of a Scheduled Payment owed by a borrower or a
reduction of the applicable Mortgage Rate by application of the Relief Act.


COLLECTION OF TAXES, ASSESSMENTS AND SIMILAR ITEMS

     The Master Servicer and the Servicers will, to the extent required by the
related loan documents, maintain escrow accounts for the collection of hazard
insurance premiums and real estate taxes with respect to the Mortgage Loans,
and will make advances with respect to delinquencies in required


                                      S-42


escrow payments by the related borrowers to the extent necessary to avoid the
loss of a Mortgaged Property due to a tax sale or the foreclosure thereof as a
result of a tax lien.


INSURANCE COVERAGE

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


EVIDENCE AS TO COMPLIANCE

     The Trust Agreement will provide that each year during which the Master
Servicer directly services any of the Mortgage Loans as servicer, a firm of
independent accountants will furnish a statement to the Trustee to the effect
that such firm has examined certain documents and records relating to the
servicing of mortgage loans similar to the Mortgage Loans serviced by the
Master Servicer and that, on the basis of such examination, such firm is of the
opinion that the servicing has been conducted in accordance with the terms of
the Trust Agreement, except for (1) exceptions as the firm believes to be
immaterial and (2) any other exceptions set forth in such statement.


                                TRUST AGREEMENT


GENERAL

     The Certificates will be issued pursuant to a Trust Agreement (the "Trust
Agreement") dated as of November 1, 2004 among the Depositor, the Master
Servicer and the Trustee. Reference is made to the Prospectus for important
information in addition to that set forth herein regarding the terms and
conditions of the Trust Agreement and the Offered Certificates. Offered
Certificates in certificated form will be transferable and exchangeable at the
Corporate Trust Office of the Trustee, which will serve as certificate
registrar and paying agent. The Trustee will make available via internet
website to a prospective or actual Certificateholder upon written request, a
copy (without exhibits) of the Trust Agreement in electronic form. Requests
should be addressed to Citibank, N.A., 388 Greenwich, 14th Floor, New York, New
York 10013, Attention: Agency and Trust -- SASCO 2004-22.


ASSIGNMENT OF MORTGAGE LOANS

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

     As to each Mortgage Loan, the following documents are generally required
to be delivered to the Trustee (or its custodian) in accordance with the Trust
Agreement: (1) the related original Mortgage Note endorsed without recourse to
the Trustee or in blank, (2) the original Mortgage with evidence of recording
indicated thereon, (or, if the original recorded Mortgage has not yet been
returned by the recording office, a copy thereof certified to be a true and
complete copy of such Mortgage sent for recording) or, in the case of a
cooperative loan, the original security agreement and related documents, (3) an
original assignment of the Mortgage to the Trustee or in blank in recordable
form (except as described below) or, in the case of a cooperative loan, an
original assignment of security agreement and related documents, (4) the
policies of title insurance issued with respect to each Mortgage Loan (other
than a cooperative loan) and (5) the originals of any assumption, modification,
extension or guaranty agreements. It is expected that the Mortgages or
assignments of Mortgage with


                                      S-43


respect to many of the Mortgage Loans will have been recorded in the name of an
agent on behalf of the holder of the related Mortgage Note. In those cases, no
Mortgage assignment in favor of the Trustee will be required to be prepared,
delivered or recorded. Instead, the applicable Servicer will be required to
take all actions as are necessary to cause the Trustee to be shown as the owner
of the related Mortgage Loan on the records of the agent for purposes of the
system of recording transfers of beneficial ownership of mortgages maintained
by the agent.

     One or more of the documents described above, or other documents, are not
available with respect to certain of the Mortgage Loans. The Depositor will not
be obligated to repurchase or substitute for any such defective Mortgage Loan
unless a loss that would otherwise constitute a Realized Loss is incurred with
respect to such Mortgage Loan and such loss resulted from the failure to
deliver such documents.

REPRESENTATIONS AND WARRANTIES

     The Mortgage Loans were either (i) purchased by the Seller directly from
various transferors (each, a "Transferor") pursuant to various transfer
agreements (each, a "Sale Agreement") or purchased by Lehman Bank from
Transferors under Sale Agreements and subsequently assigned to the Seller,
together with all rights and obligations of Lehman Bank under the related Sale
Agreement (the "Transferred Mortgage Loans") or (ii) originated by Lehman Bank
or other affiliate of the Seller and subsequently assigned to the Seller (the
"Lehman Originated Mortgage Loans").

     Pursuant to the terms of each Sale Agreement, each Transferor has made to
the Seller, as direct purchaser or assignee, as of the date of (or provided in)
the applicable Sale Agreement (each such date, a "Sale Date") certain
representations and warranties concerning the Transferred Mortgage Loans that
generally include representations and warranties similar to those summarized in
the Prospectus under the heading "Loan Underwriting Procedures and Standards --
Representations and Warranties." The Seller's rights under each Sale Agreement
will be assigned by the Seller to the Depositor pursuant to a mortgage loan
sale and assignment agreement (the "Sale and Assignment Agreement") and, in
turn, assigned by the Depositor to the Trustee for the benefit of holders of
the Offered Certificates pursuant to the Trust Agreement. With respect to any
Lehman Originated Mortgage Loans, the Seller will make certain representations
and warranties to the Depositor in the Sale and Assignment Agreement concerning
such Lehman Originated Mortgage Loans that generally include representations
and warranties similar to those summarized in the Prospectus under the heading
"Loan Underwriting Procedures and Standards -- Representations and Warranties"
which will be, in turn, assigned by the Depositor to the Trustee for the
benefit of holders of the Offered Certificates pursuant to the Trust Agreement.
In addition, each Transferor has represented to the Seller, and/or the Seller
has represented to the Depositor, that (1) each Mortgage Loan at the time it
was made complied in all material respects with applicable local, state and
federal laws, including but not limited to, all applicable anti-predatory and
anti-abusive lending laws; (2) none of the Mortgage Loans constitute "high-cost
loans" under applicable anti-predatory and anti-abusive lending laws; (3) no
proceeds from any Mortgage Loan were used to finance single premium credit
insurance policies; (4) no Mortgage Loan imposes a prepayment premium for a
term in excess of five years; and (5) the Seller has no reason to believe that
any borrower will default under the related Mortgage Loan (or that foreclosure
will be commenced) within six months following the Closing Date. Within the
period of time specified in the Trust Agreement following its discovery of a
breach of any representation or warranty that materially and adversely affects
the value of the Mortgage Loan, or receipt of notice of such breach, the
applicable Transferor or the Seller will be obligated to cure such breach or
purchase the affected Mortgage Loan from the Trust Fund for a price equal to
the unpaid principal balance thereof plus accrued interest thereon plus any
costs and damages incurred by the Trust Fund in connection with any violation
of any anti-predatory or anti-abusive lending laws (or, in certain
circumstances, to substitute another mortgage loan).

     In addition, pursuant to the Sale and Assignment Agreement with respect to
any Transferred Mortgage Loans, the Seller will make to the Depositor (and the
Depositor will assign to the Trustee for the benefit of holders of the Offered
Certificates) only certain limited representations and warranties intended to
address certain material conditions that may arise with respect to the Mortgage



                                      S-44


Loans between the applicable Sale Date and the Closing Date. In the event of a
breach of any such representation or warranty that does not constitute a breach
of any representation or warranty made by the applicable Transferor as
described above, the Seller will be obligated in the same manner as the
Transferor to cure such breach or repurchase the affected Mortgage Loan, as
described above. However, the Seller will have no obligation to cure a breach
or repurchase a Transferred Mortgage Loan if the relevant breach is a breach of
a representation or warranty made by the related Transferor under the related
Sale Agreement and such Transferor fails to fulfill its obligations.
Notwithstanding the foregoing, the Seller will represent in the Sale and
Assignment Agreement with respect to any Transferred Mortgage Loans that any
and all requirements of any federal, state or local law (including the Georgia
Fair Lending Act of 2002) applicable to the origination of each Mortgage Loan
have been complied with and that no Transferred Mortgage Loan is a "high-cost"
mortgage loan under any applicable federal, state or local predatory or abusive
lending law. In the event of a breach of those representations, the Seller will
be obligated to cure such breach or repurchase or replace the affected
Transferred Mortgage Loan.

     To the extent that any Mortgage Loan as to which a representation or
warranty has been breached is not repurchased by the applicable Transferor or
the Seller and a Realized Loss occurs with respect to that Mortgage Loan,
holders of Offered Certificates, in particular the Offered Subordinate
Certificates, may incur a loss.


VOTING RIGHTS

     The Interest-Only Certificates will be allocated 5.00% of all voting
rights, the Class E Certificates will be allocated 0.50% of all voting rights,
the Class P Certificates will be allocated 0.50% of all voting rights and the
remaining Classes of Certificates will be allocated 94.00% of all voting rights
under the Trust Agreement. Voting rights will be allocated among the Classes of
Offered Certificates in proportion to their respective Class Principal Amounts
or Class Notional Amounts and among the Certificates of each Class in
proportion to their Percentage Interests.


                  YIELD, PREPAYMENT AND WEIGHTED AVERAGE LIFE


GENERAL

     The yields to maturity (or to optional termination) of the Certificates
will be affected by the rate of principal payments (including prepayments,
which may include amounts received by virtue of repurchase, condemnation,
insurance or foreclosure) on the Mortgage Loans. Yields will also be affected
by the amount and timing of borrower delinquencies and defaults resulting in
Realized Losses on the Mortgage Loans, the purchase prices for such
Certificates and other factors.

     Principal prepayments may be influenced by a variety of economic,
geographic, demographic, social, tax, legal and other factors. In general, if
prevailing interest rates fall below the interest rates on the Mortgage Loans,
the Mortgage Loans are likely to be subject to higher prepayments than if
prevailing interest rates remain at or above the interest rates on the Mortgage
Loans. Conversely, if prevailing interest rates rise above the interest rates
on the Mortgage Loans, the rate of prepayment would be expected to decrease.
Other factors affecting prepayment of the Mortgage Loans include such factors
as changes in borrowers' housing needs, job transfers, unemployment, borrowers'
net equity in the mortgaged properties, changes in the value of the mortgaged
properties, mortgage market interest rates and servicing decisions. The
Mortgage Loans generally have due-on-sale clauses.

     In addition, the rate of principal prepayments may also be influenced by
programs offered by mortgage loan originators, servicers and brokers (including
the Servicer and their affiliates). In particular, the Seller and its
affiliates (including Aurora) may solicit borrowers using general and targeted
solicitations (which may be based on mortgage loan characteristics including,
but not limited to, interest rate, payment history, or geographic location) and
in solicitations to borrowers whom the Seller or its affiliates believe may be
considering refinancing their mortgage loans.

     The Servicing Fees are subject to reduction as described below under
"Prepayment Interest Shortfalls." See "Servicing of Loans -- Servicing
Compensation and Payment of Expenses" in the


                                      S-45


Prospectus for information regarding expenses payable by the Master Servicer
and the Servicers. The Trustee, the Master Servicer and the Servicers will be
entitled to reimbursement for certain expenses prior to distribution of any
amounts to Certificateholders.


     Approximately 39.95% of the Mortgage Loans provide for payment by the
borrower of a prepayment penalty (each, a "Prepayment Penalty Amount") during
intervals ranging from four months to five years after origination (the
"Penalty Period"). In any twelve-month period during the Penalty Period, the
borrower may generally prepay up to 20% of the original principal balance of
that Mortgage Loan without penalty. The penalty for prepayments in excess of
20% of the original principal balance will generally be equal to six months'
interest on any amount prepaid in excess of 20%. No Prepayment Penalty Amount
is assessed for any prepayment made after the applicable Penalty Period or if
that prepayment is concurrent with the sale of the Mortgaged Property. These
Prepayment Penalty Amounts may have the effect of reducing the amount or the
likelihood of prepayment on the Mortgage Loans with Prepayment Penalty Amounts
during the applicable Penalty Period. Prepayment Penalty Amounts will be
Distributed to the Class P Certificates, and accordingly, will not be available
to make distributions on the Offered Certificates.


     The rate of principal payments on the Mortgage Loans will also be affected
by the amortization schedules of the Mortgage Loans, the rate and timing of
prepayments thereon by the borrowers, liquidations of defaulted Mortgage Loans
and repurchases of Mortgage Loans due to certain breaches of representations
and warranties or defective documentation. The timing of changes in the rate of
prepayments, liquidations and repurchases of the Mortgage Loans may, and the
timing of Realized Losses will, significantly affect the yield to an investor,
even if the average rate of principal payments experienced over time is
consistent with an investor's expectation. Because the rate and timing of
principal payments on the Mortgage Loans will depend on future events and on a
variety of factors (as described more fully herein and in the Prospectus under
"Yield, Prepayment and Maturity Considerations"), no assurance can be given as
to such rate or the timing of principal payments on the Offered Certificates.
In general, the earlier a prepayment of principal of a Mortgage Loan, the
greater the effect on an investor's yield. The effect on an investor's yield of
principal payments occurring at a rate higher (or lower) than the rate
anticipated by the investor during the period immediately following the
issuance of the Certificates may not be offset by a subsequent like decrease
(or increase) in the rate of principal payments.


     From time to time, areas of the United States and especially California
may be affected by flooding, severe storms, landslides, wildfires, earthquakes
or other natural disasters. Under the Sale and Assignment Agreement, the Seller
will represent and warrant that as of the Closing Date each Mortgaged Property
was free of material damage. In the event of an uncured breach of this
representation and warranty that materially and adversely affects the interests
of Certificateholders, the Seller will be required to repurchase the affected
Mortgage Loan or substitute another mortgage loan therefor. If any damage
caused by flooding, storms, wildfires, landslides or earthquakes (or other
cause) occurs after the Closing Date, the Seller will not have any repurchase
obligation. In addition, the standard hazard policies covering the Mortgaged
Properties generally do not cover damage caused by earthquakes, flooding and
landslides, and earthquake, flood or landslide insurance may not have been
obtained with respect to such Mortgaged Properties. As a consequence, Realized
Losses could result. To the extent that the Insurance Proceeds received with
respect to any damaged Mortgaged Properties are not applied to the restoration
thereof, the proceeds will be used to prepay the related Mortgage Loans in
whole or in part. Any repurchases or repayments of the Mortgage Loans may
reduce the weighted average lives of the Offered Certificates and will reduce
the yields on the Offered Certificates to the extent they are purchased at a
premium.


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


                                      S-46


     Yields on the Offered Certificates may be adversely affected by Net
Prepayment Interest Shortfalls and Relief Act Reductions. See "Description of
the Certificates -- Distributions of Interest" herein.

     As described under "Description of the Certificates" herein, principal
prepayments on the Mortgage Loans will be allocated to the Senior Certificates
(except for the Class AIO Certificates) during the first five years following
the Closing Date (except as described herein).

     Yields on the Offered Certificates will be affected by the exercise by the
Master Servicer of its right to purchase the Mortgage Loans as described under
"Description of the Certificates -- Optional Termination of the Trust Fund"
herein, or by the failure of the Master Servicer to exercise that right.

     The effective yield to holders of the Offered Certificates (other than the
Class A1 Certificates) will be lower than the yield otherwise produced by the
applicable Interest Rate and the related purchase price because monthly
distributions will not be payable to such holders until the 25th day of the
month (or the immediately following Business Day if such day is not a Business
Day) following the month in which interest accrues on the Mortgage Loans
(without any additional distribution of interest or earnings thereon in respect
of such delay).

     Five Business Days prior to the First Auction Distribution Date, the
Auction Administrator will auction the Class A2 Certificates to third-party
bidders. Proceeds from the auction will be used to pay the holders of the Class
A2 Certificates the Minimum Call Price (exclusive of the costs and expenses of
the Auction Administrator). The Auction Administrator will not sell the Class
A2 Certificates unless it has received at least three bids and at least one
such bid is for not less than the Minimum Call Price. However, if the Minimum
Call Price is not received, the Class A2 Certificates will not be transferred
to any such third-party bidders and the interest rate on the Class A2
Certificates for each Distribution Date thereafter will be increased to an
annual rate of 5.36% per annum (subject to a maximum rate equal to the
Available Funds Cap). Thereafter, the auction will be repeated every three
months until the Minimum Call Price is received. On the first Distribution Date
following the Auction Distribution Date on which the Minimum Call Price is
received, the interest rate on the Class A2 Certificates shall be an annual
rate equal to the Net WAC. Following the Auction Distribution Date on which the
Minimum Call Price is received and after the Class Principal Amounts of the
Class A1 and Class A2 Certificates have been reduced to zero, the Class A2
Certificates shall receive all amounts of interest and principal otherwise
payable to the Class A3 Certificates until the Class Principal Amount of the
Class A3 Certificates has been reduced to zero. If the Minimum Call Price is
not received, the holders of the Class A2 Certificates will continue to hold
their certificates after the Auction Distribution Date, unless they choose to
sell them in the secondary market or the Minimum Call Price is received on a
subsequent Distribution Date. To the extent the Class A2 Certificates are then
sold in the secondary market, the holders of the Class A2 Certificates may
incur a loss. Beginning with the first distribution date, the interest accrued
on the Class A3 Certificates will be distributed as principal first to the
Class A1 Certificates, until the Class Principal Amount of the Class A1
Certificates is reduced to zero and then to the Class A2 Certificates, until
the Class Principal Amount of the Class A2 Certificates is reduced to zero. The
Class Principal Amount of the Class A3 Certificates will be increased on each
Distribution Date by an amount equal to the interest accrued on the Class A3
Certificates for such Distribution Date to the extent such interest was
distributed as principal as described in the preceding sentence. See
Descriptions of the Certificates -- Class A2 Auction" in this prospectus
supplement.

SUBORDINATION OF THE OFFERED SUBORDINATE CERTIFICATES

     On each Distribution Date, the holders of Classes of Certificates having a
relatively higher priority of distribution will have a preferential right to
receive amounts of interest and principal due them on such Distribution Date
before any distributions are made on any Class of Certificates subordinate to
such higher ranking Class. As a result, the yields to maturity and the
aggregate amount of distributions on the Class B1, Class B2 and Class B3
Certificates will be more sensitive than the yields of higher ranking
Certificates to the rate of delinquencies and defaults on the Mortgage Loans.

     As more fully described herein, the principal portion of Realized Losses
(other than Excess Losses) on the Mortgage Loans will be allocated (directly,
or through application of a Subordinate


                                      S-47


Certificate Writedown Amount) first to the lower ranking Class of Subordinate
Certificates, then to the higher ranking Class of Subordinate Certificates, in
inverse order of priority, until the Class Principal Amount of each such Class
has been reduced to zero, before any such Realized Losses will be allocated to
the Senior Certificates. The interest portion of Realized Losses on the
Mortgage Loans (other than Excess Losses) will reduce the amount available for
distribution on the related Distribution Date to the lowest ranking Class
outstanding on such date.


SENSITIVITY OF CERTAIN CLASSES OF CERTIFICATES


     The yields of the Interest-Only Certificates will be extremely sensitive
to the rate and timing of principal prepayments on the Mortgage Loans.


     Prospective investors in the Interest-Only Certificates should carefully
consider the risk that a faster than anticipated rate of prepayments on the
Mortgage Loans could result in actual yields that are lower than anticipated
yields, and could result in a failure of such investors to fully recover their
initial investments.


     THE CLASS AIO CERTIFICATES WILL NOT BE ENTITLED TO RECEIVE DISTRIBUTIONS
OF ANY KIND FOLLOWING THE DISTRIBUTION DATE ON WHICH THE FIRST AUCTION
DISTRIBUTION DATE OCCURS.


     To illustrate the significance of prepayments on the yields on these
Certificates, the following table indicates the pre-tax yields to maturity (on
a corporate bond equivalent basis) and weighted average lives under the
specified assumptions at the constant percentages of the Prepayment Assumption
(as defined below) shown. The yields shown were calculated by determining the
monthly discount rates that, when applied to the assumed streams of cash flows
to be paid on the applicable Class of Certificates, would cause the discounted
present value of such assumed streams of cash flows to equal the assumed
aggregate purchase price of such Class and converting such monthly rates to
corporate bond equivalent rates. These calculations do not take into account
variations that may occur in the interest rates at which investors may be able
to reinvest funds received by them as distributions on such Certificates and
consequently do not purport to reflect the return on any investment in any such
Class of Certificates when such reinvestment rates are considered. The weighted
average lives shown were determined by (1) multiplying the net reduction, if
any, of the Class Notional Amount, as applicable, of the applicable Class of
Certificates by the number of years from the date of issuance of the applicable
Class of Certificates to the related Distribution Date, (2) adding the results
and (3) dividing the sum by the aggregate of the net reductions of Class
Notional Amount of the applicable Class of Certificates described in clause (1)
above. It is unlikely that any of the Mortgage Loans in the Trust Fund will
prepay at any of the assumed constant rates shown or at any other constant rate
until maturity. (The weighted average lives of the Interest-Only Certificates
are shown for illustrative purposes only. The Interest-Only Certificates are
not entitled to distributions of principal and therefore have no weighted
average lives.) The timing of changes in the rate of prepayments may
significantly affect the actual yields to maturity and weighted average lives,
even if the average rate of principal prepayments is consistent with an
investor's expectation.


                                      S-48


     The following table was prepared on the basis of the characteristics of
the Mortgage Loans expected to be included in the Trust Fund, the Modeling
Assumptions set forth under "-- Weighted Average Life" below, except as
described in this paragraph, and the additional assumptions that (1) the
assumed purchase price (expressed as a percentage of the Class Notional
Amount), exclusive of accrued interest as set forth below and (2) the initial
Class Notional Amount and Interest Rate of the Class AIO Certificates are as
set forth or described herein. The table below was prepared on the basis that
such Certificates are not entitled to distributions of any kind after the First
Auction Distribution Date.


           PRE-TAX YIELD* TO MATURITY OF THE CLASS AIO CERTIFICATES
                  (ASSUMED PURCHASE PRICE PERCENTAGE: 1.5625%)





                                                           PERCENTAGE OF PREPAYMENT ASSUMPTION
                                            ------------------------------------------------------------------
                                                50%           75%           100%          125%         150%
                                            -----------   -----------   -----------   -----------   ----------

Yield ...................................       33.19%        27.28%        21.13%        14.69%        7.16%
Weighted Average Life in Years ..........        3.87          3.43          3.04          2.69         2.35


----------
*     Corporate bond equivalent basis


     The Mortgage Loans in the Trust Fund may not have the characteristics
assumed for purposes of the table above, and there can be no assurance that the
Mortgage Loans will prepay at any of the constant rates assumed, that the
actual pre-tax yields to maturity and weighted average lives for the
Interest-Only Certificates will correspond to any of the calculated yields and
weighted average lives shown herein, or that the purchase price of such
Certificates will be as assumed. Each investor should make its own
determination as to the appropriate assumptions to be used and factors to be
considered in deciding whether to purchase an Interest-Only Certificate.


WEIGHTED AVERAGE LIFE

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

     PREPAYMENT ASSUMPTION. Prepayments on mortgage loans are commonly measured
relative to a constant prepayment standard or model. The model used in this
Prospectus Supplement for the Mortgage Loans is a prepayment assumption (the
"Prepayment Assumption") that represents an assumed rate of prepayment each
month relative to the then outstanding principal balance of the Mortgage Loans
for the life of such Mortgage Loans. A 100% Prepayment Assumption for the
Mortgage Loans assumes a constant prepayment rate of 6.00% per annum of the
outstanding principal balance of such Mortgage Loans for the first month
following origination of the Mortgage Loan and approximately an additional
1.27% in each month thereafter for the next eleven months; and in each month
thereafter during the life of such Mortgage Loans, a constant prepayment rate
of 20% per annum is assumed. As used in the tables below, a 0% Prepayment
Assumption assumes prepayment rates equal to 0% of the Prepayment Assumption,
i.e. no prepayments; a 50% Prepayment Assumption assumes prepayment rates equal
to 50% of the Prepayment Assumption, and so forth. The Prepayment Assumption
does not purport to be either a historical description of the prepayment
experience of any pool of mortgage loans or a prediction of the anticipated
rate of prepayment of any mortgage loans, including the Mortgage Loans to be
included in the Trust Fund.

     The tables beginning on page S-51 were prepared based on the following
additional assumptions (collectively, the "Modeling Assumptions"): (1) the
initial Class Principal Amounts and the Interest Rates are as described in this
Prospectus Supplement; (2) the first Scheduled Payment of principal and
interest to be included in the Trust Fund is timely received on December 1,
2004; (3) principal prepayments are received in full on the last day of each
month commencing in November 2004 and


                                      S-49


there are no Net Prepayment Interest Shortfalls; (4) there are no defaults or
delinquencies on the Mortgage Loans; (5) there are no repurchases or
substitutions of the Mortgage Loans; (6) there is no optional termination of
the Trust Fund; (7) the Certificates are issued on December 15, 2004; (8)
Distribution Dates occur on the 25th day of each month commencing in December
2004; and (9) the Mortgage Loans were assumed to have the following
characteristics:


                     ASSUMED MORTGAGE LOAN CHARACTERISTICS





                                                                   ORIGINAL     REMAINING
                                                     NET            TERM TO      TERM TO       REMAINING
       PRINCIPAL               MORTGAGE            MORTGAGE        MATURITY     MATURITY     INTEREST-ONLY
      BALANCE ($)              RATE (%)            RATE (%)        (MONTHS)     (MONTHS)     TERM (MONTHS)
-----------------------   -----------------   -----------------   ----------   ----------   --------------

123,035,717.68.........       5.8709366457        5.6209366457    360          359                  0
6,235,380.71...........       5.9757680259        5.7257680259    360          359                  0
1,850,636.68...........       5.8540079204        5.6040079204    360          360                  0
2,506,116.31...........       5.8142386541        5.5642386541    360          360                  0
4,194,121.64...........       5.8835079039        5.6335079039    360          358                  0
7,271,372.22...........       5.8452424704        5.5952424704    360          359                  0
1,287,374.74...........       5.9178975420        5.6678975420    360          359                  0
7,450,296.00...........       5.8744548569        5.6244548569    360          358                  0
35,530,059.15..........       5.8757401417        5.6257401417    360          358                  0
70,730,781.73..........       5.9071893422        5.6571893422    360          358                118
1,184,643.75...........       6.0442795302        5.7942795302    360          359                119
368,850.00 ............       6.0000000000        5.7500000000    360          359                119
4,418,684.50...........       5.8899436444        5.6399436444    360          358                118
1,302,497.19...........       6.0459595224        5.7959595224    360          359                119
4,285,750.00...........       5.8750364580        5.6250364580    360          359                119
900,000.00 ............       6.0000000000        5.7500000000    360          360                120
8,147,819.97...........       5.9520819682        5.7020819682    360          359                119
41,968,666.96..........       5.8501861265        5.6001861265    360          358                118


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

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

     The weighted average life of an Offered Certificate is determined by (1)
multiplying the net reduction, if any, of the applicable Class Principal Amount
by the number of years from the date of issuance of the Offered Certificate to
the related Distribution Date, (2) adding the results and (3) dividing the sum
by the aggregate of the net reductions of Class Principal Amount described in
(1) above.



                                      S-50


   PERCENTAGE OF INITIAL CLASS PRINCIPAL AMOUNT OF THE OFFERED CERTIFICATES
     OUTSTANDING AT THE FOLLOWING PERCENTAGES OF THE PREPAYMENT ASSUMPTION






                                                       CLASS A1 CERTIFICATES
                                         -------------------------------------------------
DATE                                        50%       75%       100%      125%      150%
---------------------------------------- --------- --------- --------- --------- ---------

Initial Percentage .....................     100       100       100       100       100
November 25, 2005 ......................      57        38        19         0         0
November 25, 2006 ......................       6         0         0         0         0
November 25, 2007 ......................       0         0         0         0         0
November 25, 2008 ......................       0         0         0         0         0
November 25, 2009 ......................       0         0         0         0         0
November 25, 2010 ......................       0         0         0         0         0
November 25, 2011 ......................       0         0         0         0         0
November 25, 2012 ......................       0         0         0         0         0
November 25, 2013 ......................       0         0         0         0         0
November 25, 2014 ......................       0         0         0         0         0
November 25, 2015 ......................       0         0         0         0         0
November 25, 2016 ......................       0         0         0         0         0
November 25, 2017 ......................       0         0         0         0         0
November 25, 2018 ......................       0         0         0         0         0
November 25, 2019 ......................       0         0         0         0         0
November 25, 2020 ......................       0         0         0         0         0
November 25, 2021 ......................       0         0         0         0         0
November 25, 2022 ......................       0         0         0         0         0
November 25, 2023 ......................       0         0         0         0         0
November 25, 2024 ......................       0         0         0         0         0
November 25, 2025 ......................       0         0         0         0         0
November 25, 2026 ......................       0         0         0         0         0
November 25, 2027 ......................       0         0         0         0         0
November 25, 2028 ......................       0         0         0         0         0
November 25, 2029 ......................       0         0         0         0         0
November 25, 2030 ......................       0         0         0         0         0
November 25, 2031 ......................       0         0         0         0         0
November 25, 2032 ......................       0         0         0         0         0
November 25, 2033 ......................       0         0         0         0         0
November 25, 2034 ......................       0         0         0         0         0
Weighted Average Life in Years .........     1.12      0.82      0.66      0.55      0.48


                                      S-51


   PERCENTAGE OF INITIAL CLASS PRINCIPAL AMOUNT OF THE OFFERED CERTIFICATES
     OUTSTANDING AT THE FOLLOWING PERCENTAGES OF THE PREPAYMENT ASSUMPTION






                                              CLASS A2 CERTIFICATES
                                                  (TO MATURITY)
                                -------------------------------------------------
DATE                               50%       75%       100%      125%      150%
------------------------------- --------- --------- --------- --------- ---------

Initial Percentage ............     100       100       100       100       100
November 25, 2005 .............     100       100       100       100        95
November 25, 2006 .............     100        91        82        73        64
November 25, 2007 .............      90        76        64        52        42
November 25, 2008 .............      79        63        49        37        28
November 25, 2009 .............      70        52        38        26        17
November 25, 2010 .............      62        43        29        18        11
November 25, 2011 .............      54        35        22        13         6
November 25, 2012 .............      48        29        17         9         4
November 25, 2013 .............      42        24        13         6         2
November 25, 2014 .............      37        20        10         4         1
November 25, 2015 .............      32        16         8         3         1
November 25, 2016 .............      28        13         6         2          *
November 25, 2017 .............      24        10         4         1          *
November 25, 2018 .............      20         8         3         1         0
November 25, 2019 .............      17         6         2          *        0
November 25, 2020 .............      14         5         1         0         0
November 25, 2021 .............      12         4         1         0         0
November 25, 2022 .............       9         2          *        0         0
November 25, 2023 .............       7         1         0         0         0
November 25, 2024 .............       5         1         0         0         0
November 25, 2025 .............       4         0         0         0         0
November 25, 2026 .............       2         0         0         0         0
November 25, 2027 .............       1         0         0         0         0
November 25, 2028 .............       0         0         0         0         0
November 25, 2029 .............       0         0         0         0         0
November 25, 2030 .............       0         0         0         0         0
November 25, 2031 .............       0         0         0         0         0
November 25, 2032 .............       0         0         0         0         0
November 25, 2033 .............       0         0         0         0         0
November 25, 2034 .............       0         0         0         0         0
Weighted Average Life in Years      9.06      6.51      4.95      3.92      3.19




                                              CLASS A2 CERTIFICATES
                                    (TO THE FIRST AUCTION DISTRIBUTION DATE)
                                -------------------------------------------------
DATE                               50%       75%       100%      125%      150%
------------------------------- --------- --------- --------- --------- ---------

Initial Percentage ............     100       100       100       100       100
November 25, 2005 .............     100       100       100       100        95
November 25, 2006 .............     100        91        82        73        64
November 25, 2007 .............      90        76        64        52        42
November 25, 2008 .............      79        63        49        37        28
November 25, 2009 .............      70        52        38        26         0
November 25, 2010 .............       0         0         0         0         0
November 25, 2011 .............       0         0         0         0         0
November 25, 2012 .............       0         0         0         0         0
November 25, 2013 .............       0         0         0         0         0
November 25, 2014 .............       0         0         0         0         0
November 25, 2015 .............       0         0         0         0         0
November 25, 2016 .............       0         0         0         0         0
November 25, 2017 .............       0         0         0         0         0
November 25, 2018 .............       0         0         0         0         0
November 25, 2019 .............       0         0         0         0         0
November 25, 2020 .............       0         0         0         0         0
November 25, 2021 .............       0         0         0         0         0
November 25, 2022 .............       0         0         0         0         0
November 25, 2023 .............       0         0         0         0         0
November 25, 2024 .............       0         0         0         0         0
November 25, 2025 .............       0         0         0         0         0
November 25, 2026 .............       0         0         0         0         0
November 25, 2027 .............       0         0         0         0         0
November 25, 2028 .............       0         0         0         0         0
November 25, 2029 .............       0         0         0         0         0
November 25, 2030 .............       0         0         0         0         0
November 25, 2031 .............       0         0         0         0         0
November 25, 2032 .............       0         0         0         0         0
November 25, 2033 .............       0         0         0         0         0
November 25, 2034 .............       0         0         0         0         0
Weighted Average Life in Years      4.56      4.09      3.64      3.23      2.82


----------
*     Indicates a value between 0.0% and 0.5%.


                                      S-52


   PERCENTAGE OF INITIAL CLASS PRINCIPAL AMOUNT OF THE OFFERED CERTIFICATES
     OUTSTANDING AT THE FOLLOWING PERCENTAGES OF THE PREPAYMENT ASSUMPTION






                                            CLASS B1, CLASS B2 AND CLASS B3 CERTIFICATES
                                        ----------------------------------------------------
DATE                                        50%        75%       100%       125%      150%
--------------------------------------- ---------- ---------- ---------- --------- ---------

Initial Percentage ....................      100        100        100       100       100
November 25, 2005 .....................       99         99         99        99        99
November 25, 2006 .....................       98         98         98        98        98
November 25, 2007 .....................       98         98         98        98        98
November 25, 2008 .....................       97         97         97        97        97
November 25, 2009 .....................       96         96         96        96        96
November 25, 2010 .....................       92         90         89        87        85
November 25, 2011 .....................       87         84         80        77        73
November 25, 2012 .....................       81         75         69        64        58
November 25, 2013 .....................       73         65         57        50        43
November 25, 2014 .....................       65         54         45        37        30
November 25, 2015 .....................       57         45         35        27        20
November 25, 2016 .....................       50         37         27        20        14
November 25, 2017 .....................       43         31         21        14         9
November 25, 2018 .....................       38         25         16        10         6
November 25, 2019 .....................       32         20         13         7         4
November 25, 2020 .....................       28         17         10         5         3
November 25, 2021 .....................       24         13          7         4         2
November 25, 2022 .....................       20         11          6         3         1
November 25, 2023 .....................       17          9          4         2          *
November 25, 2024 .....................       14          7          3         1         0
November 25, 2025 .....................       12          5          2         1         0
November 25, 2026 .....................       10          4          1          *        0
November 25, 2027 .....................        8          3          1         0         0
November 25, 2028 .....................        6          2           *        0         0
November 25, 2029 .....................        5          1          0         0         0
November 25, 2030 .....................        3          1          0         0         0
November 25, 2031 .....................        2          0          0         0         0
November 25, 2032 .....................        1          0          0         0         0
November 25, 2033 .....................        0          0          0         0         0
November 25, 2034 .....................        0          0          0         0         0
Weighted Average Life in Years ........     13.05      11.35      10.22      9.43      8.84




                                                      CLASS R CERTIFICATES
                                        -------------------------------------------------
DATE                                       50%       75%       100%      125%      150%
--------------------------------------- --------- --------- --------- --------- ---------

Initial Percentage ....................     100       100       100       100       100
November 25, 2005 .....................       0         0         0         0         0
November 25, 2006 .....................       0         0         0         0         0
November 25, 2007 .....................       0         0         0         0         0
November 25, 2008 .....................       0         0         0         0         0
November 25, 2009 .....................       0         0         0         0         0
November 25, 2010 .....................       0         0         0         0         0
November 25, 2011 .....................       0         0         0         0         0
November 25, 2012 .....................       0         0         0         0         0
November 25, 2013 .....................       0         0         0         0         0
November 25, 2014 .....................       0         0         0         0         0
November 25, 2015 .....................       0         0         0         0         0
November 25, 2016 .....................       0         0         0         0         0
November 25, 2017 .....................       0         0         0         0         0
November 25, 2018 .....................       0         0         0         0         0
November 25, 2019 .....................       0         0         0         0         0
November 25, 2020 .....................       0         0         0         0         0
November 25, 2021 .....................       0         0         0         0         0
November 25, 2022 .....................       0         0         0         0         0
November 25, 2023 .....................       0         0         0         0         0
November 25, 2024 .....................       0         0         0         0         0
November 25, 2025 .....................       0         0         0         0         0
November 25, 2026 .....................       0         0         0         0         0
November 25, 2027 .....................       0         0         0         0         0
November 25, 2028 .....................       0         0         0         0         0
November 25, 2029 .....................       0         0         0         0         0
November 25, 2030 .....................       0         0         0         0         0
November 25, 2031 .....................       0         0         0         0         0
November 25, 2032 .....................       0         0         0         0         0
November 25, 2033 .....................       0         0         0         0         0
November 25, 2034 .....................       0         0         0         0         0
Weighted Average Life in Years ........     0.03      0.03      0.03      0.03      0.03


----------
*     Indicates a value between 0.0% and 0.5%.


                                      S-53


                   MATERIAL FEDERAL INCOME TAX CONSIDERATIONS


GENERAL

     The Trust Agreement provides that the Trust Fund (exclusive of amounts
payable in respect of the Class E and Class P Certificates) will comprise
multiple real estate mortgage investment conduits (the "REMICs"). In the
opinion of Dechert LLP ("Tax Counsel"), assuming compliance with the Trust
Agreement, and the agreements relating to the servicing of the Mortgage Loans
and the accuracy of the representations made in the transfer agreements with
respect to the Mortgage Loans, for federal income tax purposes the REMICs will
each qualify as a "REMIC" within the meaning of Section 860D of the Internal
Revenue Code of 1986, as amended (the "Code"). In addition, in the opinion of
Tax Counsel, the Offered Certificates, other than the Class R, Class E and
Class P Certificates, will evidence ownership of REMIC regular interests within
the meaning of Section 860G(a)(1) of the Code and the Class R Certificate will
evidence ownership of the sole class of residual interest, within the meaning
of Section 860G(a) (2) of the Code, in each REMIC.

     For federal income tax purposes, for Distribution Dates prior to or during
the month of a successful auction, the interest rate on the REMIC regular
interest represented by the Class A2 Certificates will be subject to a cap
equal to the Net WAC. In addition to representing the beneficial ownership of
such REMIC regular interest, for Distribution Dates prior to or during the
month of a successful auction, the Class A2 Certificates will also represent
the beneficial ownership of any excess of the interest distributable on such
class over the interest that would have accrued on such class had the interest
rate on such class been subject to a cap equal to the Net WAC (such excess,
"Excess Interest Payments"). The rights to Excess Interest Payments associated
with the Class A2 Certificates will not, for federal income tax purposes, be
treated as interests in a REMIC.

     Certain Classes of Offered Certificates (other than the Class R
Certificates) may be issued with original issue discount ("OID") for federal
income tax purposes. See "Material Federal Income Tax Considerations --
Taxation of Securities Treated as Debt Instruments -- Interest Income and OID"
in the Prospectus. The prepayment assumption that will be used in determining
the rate of accrual of OID, market discount and premium, if any, for federal
income tax purposes will be a rate equal to 100% of the Prepayment Assumption.
No representation is made that the Mortgage Loans will prepay at this rate or
at any other rate. OID must be included in income as it accrues on a constant
yield method, regardless or whether a holder receives concurrently the cash
attributable to such OID.


ADDITIONAL TAX CONSIDERATIONS APPLICABLE TO THE CLASS A2 CERTIFICATES

     Through the Distribution Date occurring during the month of a successful
auction, each Class A2 Certificate (a "Basis Risk Protected Certificate") will
represent, in addition to a REMIC regular interest, the right to receive
payments in respect of Excess Interest Payments. For information reporting
purposes, the entitlement to payments in respect of Excess Interest Payments
will be treated as an interest in interest rate cap contracts (the "Interest
Rate Cap Agreements") and, under the terms of the Trust Agreement, each holder
of a Basis Risk Protected Certificate will agree, by virtue of the purchase of
such Certificate, to adopt a tax reporting position consistent with that
characterization. Alternative characterizations of such rights are, however,
possible. For instance, the right to receive such payments could be classified
for federal income tax purposes as in whole or in part a debt instrument or as
an interest in a partnership formed among the affected Certificateholders to
share cash flows from the Class A3 Certificates. Such an alternative
characterization would result in tax treatment of payments in respect of Excess
Interest Payments that would differ from that which is described below.

     Prospective investors in the Basis Risk Protected Certificates should
consult their tax advisors regarding the tax treatment of the rights of the
holders of such Certificates to receive payments in respect of Excess Interest
Payments.

     A holder of a Basis Risk Protected Certificate must allocate its purchase
price for such Certificate between its components--the regular interest
component and the Interest Rate Cap Agreements


                                      S-54


components. For information reporting purposes, it will be assumed that, with
respect to a Basis Risk Protected Certificate, the Interest Rate Cap Agreements
components will have no value. The Internal Revenue Service could argue,
however, that the Interest Rate Cap Agreements components have value, and if
that argument were to be sustained, the regular interest component could be
viewed as having been issued with an additional amount of OID (which could
cause the total amount of discount to exceed a statutorily defined de minimis
amount). See "Material Federal Income Tax Considerations -- Taxation of
Securities Treated as Debt Instruments" in the Prospectus.

     Upon the sale, exchange, or other disposition of a Basis Risk Protected
Certificate, the holder must allocate the amount realized between the
components of such Certificate based on the relative fair market values of
those components at the time of sale. Assuming that a Basis Risk Protected
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 an Interest Rate
Cap Agreements component should be capital gain or loss. Except for any amounts
of accrued but unrecognized market discount, and except as provided in this
paragraph, any gain or loss on the sale or exchange of the regular interest
component of a Basis Risk Protected Certificate recognized by an investor who
holds such Certificate as a capital asset will be capital gain or loss and will
be long-term or short-term depending on whether the Certificate has been held
for the long-term capital gain holding period (currently more than one year).
Such gain will be treated as ordinary income (i) if the Certificate is held as
part of a conversion transaction, as described in Section 1258(c) of the Code,
up to the amount of interest that would have accrued on the holder's net
investment in the conversion transaction at 120% of the appropriate applicable
federal rate under Section 1274(d) of the Code in effect at the time the holder
entered into the transaction minus any amount previously treated as ordinary
income with respect to any prior disposition of property that was held as a
part of such transaction, (ii) in the case of a non-corporate taxpayer, to the
extent such taxpayer has made an election under Section 163(d)(4) of the Code
to have net capital gains taxed as investment income at ordinary income rates,
or (iii) to the extent that such gain does not exceed the excess, if any, of
(a) the amount that would have been includible in the gross income of the
holder if its yield on such regular interest component were 110% of the
applicable federal rate as of the date of purchase, over (b) the amount of
income actually includible in the gross income of such holder with respect to
such regular interest component. In addition, gain or loss recognized from the
sale of the regular interest component of a Basis Risk Protected Certificate by
certain banks or thrift institutions will be treated as ordinary income or loss
pursuant to Section 582(c) of the Code. Long-term capital gains of certain
non-corporate taxpayers are subject to a lower maximum federal income tax rate
than ordinary income of such taxpayers for property held for more than one
year. The maximum federal income tax rate for corporations is the same with
respect to both ordinary income and capital gains.

     As indicated above, a portion of the purchase price paid by a holder to
acquire a Basis Risk Protected Certificate will be attributable to the Interest
Rate Cap Agreements components of such Certificate. The portion of the overall
purchase price attributable to the Interest Rate Cap Agreements components must
be amortized over the life of such Basis Risk Protected Certificate's right to
receive payments in respect of Excess Interest Payments, taking into account in
each case 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 agreement is amortized over the life of the cap
as though it were the principal amount of a loan bearing interest at a
reasonable rate. Certificateholders 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 Interest Rate Cap Agreements components of a Basis
Risk Protected Certificate.

     Any payments made to a holder of a Basis Risk Protected Certificate in
respect of Excess Interest Payments will be treated as periodic payments on an
Interest Rate Cap Agreement. To the extent the sum of such periodic payments
for any year exceeds that year's amortized cost of the related Interest Rate
Cap Agreements 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. A beneficial owner's ability
to recognize a net deduction with


                                      S-55


respect to the Interest Rate Cap Agreements component is limited under Sections
67 and 68 of the Code in the case of (i) estates and trusts and (ii)
individuals owning an interest in such component directly or through a
"pass-through entity" (other than in connection with such individuals' trade or
business). Pass-through entities include partnerships, S corporations, grantor
trusts, REMICs and non-publicly offered regulated investment companies, but do
not include estates, nongrantor trusts, cooperatives, real estate investment
trusts and publicly offered regulated investment companies. Further, such a
beneficial owner will not be able to recognize a net deduction with respect to
the Interest Rate Cap Agreements component in computing the beneficial owner's
alternative minimum tax liability.

     The regular interest component of each Basis Risk Protected Certificate
will be treated as an asset described in Section 7701(a)(19)(C) of the Code in
the same proportion that the assets of the Trust Fund, exclusive of amounts
payable to the Class in respect of the Class E and Class P Certificates, would
be so treated; provided, however, that if at least 95% of the assets of the
Trust Fund, exclusive of amounts payable to the Class in respect of the Class E
and Class P Certificates, are assets described in Section 7701(a)(19)(C)(i)-(x)
of the Code, the regular interest component of each Basis Risk Protected
Certificate will be treated in its entirety as an asset described in Section
7701(a)(19)(C) of the Code. The regular interest component of each Basis Risk
Protected Certificate will be treated as a "real estate asset" under Section
856(c)(5)(B) of the Code in the same proportion that the assets of the Trust
Fund, exclusive of amounts payable to the Class in respect of the Class E and
Class P Certificates, would be so treated; provided, however, that if at least
95% of the assets of the Trust Fund, exclusive of amounts payable to the Class
in respect of the Class E and Class P Certificates, are "real estate assets"
within the meaning of Section 856(c)(5)(B) of the Code, then the regular
interest component of each Basis Risk Protected Certificate will be treated in
its entirety as a "real estate asset" under Section 856(c)(5)(B) of the Code.
Interest on the regular interest component of each Basis Risk Protected
Certificate will be treated as "interest on obligations secured by mortgages on
real property" within the meaning of Section 856(c)(3)(B) of the Code in the
same proportion that the assets of the Trust Fund, exclusive of amounts payable
to the Class in respect of the Class E and Class P Certificates, are treated as
"real estate assets" under Section 856(c)(5)(B) of the Code; provided, however,
that if at least 95% of the assets of the Trust Fund, exclusive of amounts
payable to the Class in respect of the Class E and Class P Certificates, are
"real estate assets" within the meaning of Section 856(c)(5)(B) of the Code,
then all interest on the regular interest component of each Basis Risk
Protected Certificate will be treated as "interest on obligations secured by
mortgages on real property" within the meaning of Section 856(c)(3)(B) of the
Code. The Interest Rate Cap Agreements components of the Basis Risk Protected
Certificates will not be treated as assets described in Section 7701(a)(19)(C)
of the Code or "real estate assets under Section 856(c)(5)(B) of the Code, and
payments received that are treated as attributable to the Interest Rate Cap
Agreements will not be treated as "interest on obligations secured by mortgages
on real property" within the meaning of Section 856(c)(3)(B) of the Code.

     For federal income tax purposes, the initial holders of the Class A2
Certificates may be deemed to have written a call option for the benefit of the
holders of the Class A3 Certificates at a price equal to the Minimum Call
Price. The Trust Agreement will direct the Trustee to take the position that
the holders of the Class A2 Certificates will receive only a nominal premium
for writing the option. Under such position, the writing of the option will not
result in any material additional income or gain to the holders of the Class A2
Certificates upon the auction sale or other disposition of the Class A2
Certificates.

     If the auction is successful, the holders the Class A2 Certificates who
acquire the Class A2 Certificates through the auction sale or subsequent to a
successful auction sale (such holders of the Class A2 Certificates, "Class A2
Auction Holders") will be deemed to have acquired (in addition to the REMIC
regular interest represented by the Class A2 Certificates bearing interest at a
per annum rate equal to the lesser of 5.36% or the Net WAC) all of the rights
represented by the Class A3 Certificates including the REMIC regular interest
represented by the Class A3 Certificates. A Class A2 Auction Holder will be
required to allocate a portion of its purchase price between the two REMIC
regular interests described in the preceding sentence based on their relative
fair market


                                      S-56


values at the time of acquisition, and such REMIC regular interests will
continue to be treated as separate debt instruments for federal income tax
purposes.

     Holders of the Class A2 Certificates agree, in connection with the
purchase of their Certificates, to treat the rights and obligations associated
with the Class A2 Certificates in the manner set forth above for federal income
tax purposes.


RESIDUAL CERTIFICATE

     Special tax considerations apply to an investment in a Residual
Certificate. In certain circumstances, the method of taxation of a Residual
Certificate can produce a significantly less favorable after-tax return for a
beneficial owner of a Residual Certificate than would be the case if (1) such
Residual Certificate was taxable as a debt instrument or (2) no portion of the
taxable income on such Residual Certificate in each period was treated as
"excess inclusion" income. See "Material Federal Income Tax Considerations --
REMIC Residual Certificates" in the Prospectus.

     The Class R Certificate represents ownership of the residual interest in
each of the REMICs. 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 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 "Material Federal Income Tax
Considerations -- REMIC Residual Certificates" in the Prospectus.

     Under applicable regulations, if a Residual Certificate is a "noneconomic
residual interest," as described in the Prospectus, a transfer of such Residual
Certificate to a U.S. 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.

     Under the REMIC regulations, if a Residual Certificate has tax avoidance
potential, a transfer of a Residual Certificate to a Non-U.S. Person will be
disregarded for all federal tax purposes unless the Non-U.S. Person's income
from the Residual Certificate is effectively connected with a trade or business
within the United States. See "Material Federal Income Tax Considerations --
REMIC Residual Certificates -- Restrictions on Transfers of Residual
Certificates to Foreign Persons" in the Prospectus. For these purposes, a
Non-U.S. Person means any person that is not (i) a citizen or resident of the
United States; (ii) a corporation (or entity treated as a corporation for tax
purposes) created or organized in the United States or under the laws of the
United States or of any state thereof, including, for this purpose, the
District of Columbia; (iii) a partnership (or entity treated as a partnership
for tax purposes) organized in the United States or under the laws of the
United States or of any state thereof, including, for this purpose, the
District of Columbia (unless provided otherwise by future Treasury
regulations); (iv) an estate whose income is includible in gross income for
United States income tax purposes regardless of its source; or (v) a trust, if
(I) a court within the United States is able to exercise primary supervision
over the administration of the trust and one or more U.S. persons have
authority to control all substantial decisions of the trust or (II) to the
extent provided in Treasury regulations, the trust was in existence on August
20, 1996, was treated as a U.S. person prior to such date, and elects to
continue to be treated as a U.S. person.

     It is expected that a Residual Certificate will represent ownership of
"noneconomic residual interests" and each such interest will have "tax
avoidance potential" within the meaning of the applicable regulations.

     An individual, trust or estate that holds a Residual Certificate (whether
such Certificate is held directly or indirectly through certain pass-through
entities) also may have additional gross income with respect to, but may be
subject to limitations on the deductibility of, Servicing Fees on the Mortgage
Loans and other administrative expenses of the Trust Fund in computing such
holder's regular tax liability, and may not be able to deduct such fees or
expenses to any extent in computing such holder's alternative minimum tax
liability. In addition, some portion of a purchaser's basis, if any, in a
Residual Certificate may not be recovered until the termination of the Trust
Fund. Furthermore, the federal


                                      S-57


income tax consequences of any consideration paid to a transferee on a transfer
of a Residual Certificate are unclear. Recently issued regulations require a
transferee of a noneconomic residual interest to recognize any fee received to
induce such transferee to become a holder of such interest over a period
reasonably related to the period during which the applicable REMIC is expected
to generate taxable income or net loss in a manner that reasonably reflects the
after-tax costs and benefits (without regard to such fee) of holding such
interest. The regulations provide two safe harbor methods that satisfy this
requirement. Under one method, the fee is recognized in accordance with the
method of accounting, and over the same period, that the taxpayer uses for
financial reporting purposes, provided that the fee is included in income for
financial reporting purposes over a period that is not shorter than the period
during which the applicable REMIC is expected to generate taxable income. Under
a second method, the fee is recognized ratably over the anticipated weighted
average life of the applicable REMIC (as determined under applicable Treasury
regulations) remaining as of the date of acquisition of the noneconomic
residual interest. The Internal Revenue Service may provide additional safe
harbor methods in future guidance. Once a taxpayer adopts a particular method
of accounting for such fees, the taxpayer generally may not change to a
different method without consent of the Internal Revenue Service. Under the
regulations, if any portion of such a fee has not been recognized in full by
the time the holder of a noneconomic residual interest disposes of such
interest, then the holder must include the unrecognized portion in income at
that time. The regulations also provide that such a fee shall be treated as
income from sources within the United States. Any transferee receiving
consideration with respect to a Residual Certificate should consult its tax
advisors.


TAX RETURN DISCLOSURE REQUIREMENTS

     Taxpayers are required to report certain information on Internal Revenue
Service Form 8886 if they participate in a "reportable transaction." Holders
should consult with their tax advisors as to the need to file Internal Revenue
Service Form 8886 with their federal income tax returns.


                        LEGAL INVESTMENT CONSIDERATIONS

     The Senior Certificates and the Class B1 Certificates will constitute
"mortgage related securities" for purposes of the Secondary Mortgage Market
Enhancement Act of 1984 ("SMMEA") for so long as they are rated in one of the
two highest rating categories by one or more nationally recognized statistical
rating agencies, and, as such, are legal investments for certain entities to
the extent provided in SMMEA. Such investments, however, will be subject to
general regulatory considerations governing investment practices under state
and federal laws.

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

     Accordingly, investors should consult their own legal advisors to
determine whether and to what extent the Offered Certificates may be purchased
by such investors. See "Legal Investment Considerations" in the Prospectus.

                             ERISA CONSIDERATIONS


     The U.S. Department of Labor granted Lehman Brothers Inc.'s predecessor in
interest, Shearson Lehman Hutton Inc. (Prohibited Transaction Exemption 91-14,
56 Fed. Reg. 7413 (1991), as amended (the "Exemption"), an exemption from
certain of the prohibited transaction rules of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), and Section 4975 of the Code that
apply to transactions involving employee benefit plans or arrangements subject
to Title I of ERISA or plans subject to Section 4975 of the Code (collectively,
"ERISA Plans"); provided that all conditions of the Exemption are satisfied. As
discussed below and in "ERISA Considerations" in the Prospectus,


                                      S-58


the Offered Certificates (other than the Class R Certificate) may be acquired
by ERISA Plans, as well as by plans subject to any provisions under any
federal, state, local, non-U.S. or other laws or regulations that are
substantively similar to the foregoing provisions of ERISA or the Code
("Similar Law") (together with ERISA Plans, "Plans"). Additional restrictions
apply to the ability of a Plan to acquire the Class A2 Certificates. A
fiduciary of any Plan should carefully review with its legal advisors whether
the acquisition or holding of Certificates could give rise to a transaction
prohibited or not otherwise permissible under ERISA, the Code or Similar Law.
See "ERISA Considerations" in the Prospectus for a description of the
requirements for relief under the Exemption.


     The rating of an Offered Certificate may change. If a Class of Offered
Certificates no longer has a rating of at least BBB- or its equivalent (the
lowest permitted rating), Certificates of that Class will no longer be eligible
for relief under the Exemption, and consequently a Plan's ability to acquire
such a Certificate may be significantly restricted or precluded (although a
Plan that had purchased a Certificate of that Class when the Class had a
permitted rating would not be required by the Exemption to dispose of it).


     Due to the characteristics of the Class R Certificate, the Class R
Certificate may not be acquired by a Plan. Consequently, transfers of the Class
R Certificate will not be registered by the Trustee unless it receives a
representation from the transferee of the Class R Certificate, in form and
substance acceptable to the Trustee, that the transferee is not a Plan or a
person acting for, on behalf of or with any assets of any Plan.


     When the holder of a Class A2 Certificate transfers that certificate to a
third party investor that bids more than the minimum call price on an auction
distribution date, and that third party investor (which becomes the holder of
the Class A2 Certificate) pays to the Class A3 Certificateholder the amount
paid as the call price by that third party in excess of the par value plus
accrued interest on the Class A2 Certificates, these transactions likely will
not be eligible for the exemptive relief available under the Exemption. These
transactions might constitute or result in a prohibited transaction under
Section 406 of ERISA or Section 4975 of the Code, or a violation of Similar
Law, if one party to these transactions is, or is acting on behalf of or with
any assets of, a Plan and the counterparty is a party in interest or
disqualified person with respect to that Plan. Accordingly, no Plan or any
person acting for, on behalf of or with any assets of a Plan may acquire or
hold a Class A2 Certificate prior to completion of the auction sale of Class A2
Certificates (including the payment of any amounts due to the Class A3
Certificateholder from the auction proceeds) unless the Plan's acquisition and
holding of the Class A2 Certificates would be exempt under Department of Labor
Prohibited Transaction Class Exemption ("PTCE") 84-14 (for transactions by
independent "qualified professional asset managers"), PTCE 91-38 (for
transactions by bank collective investment funds), PTCE 90-1 (for transactions
by insurance company pooled separate accounts), PTCE 95-60 (for insurance
company general accounts), or PTCE 96-23 (for "in-house asset managers"). Plan
fiduciaries should consult their legal counsel concerning these issues. Each
beneficial owner of a Class A2 Certificate, or any interest therein, shall be
deemed to have represented, by virtue of its acquisition and holding of such
Class A2 Certificate or interest therein prior to completion of the auction
sale of Class A2 Certificates (including the payment of any amounts due to the
Class A3 Certificateholder from the auction proceeds), that either (i) it is
not a Plan or a person acting for, on behalf of or with any assets of any Plan,
or (ii) the acquisition and holding of such Class A2 Certificate will not
constitute a non-exempt prohibited transaction under ERISA or the Code because
they are entitled to exemptive relief under one of the PTCEs enumerated
immediately above.


     If any Class A2 Certificate, or any interest therein, is acquired or held
in violation of the provisions of the preceding paragraph, the next preceding
permitted beneficial owner will be treated as the beneficial owner of that
certificate, retroactive to the date of transfer to the purported beneficial
owner. Any purported beneficial owner whose acquisition or holding of any such
certificate, or interest therein, was effected in violation of the provisions
of the preceding paragraph shall indemnify and hold harmless the Depositor, the
Trustee, the Master Servicer and the Trust from and against any and all
liabilities, claims, costs or expenses incurred by such parties as a result of
such acquisition and holding, to the maximum extent permitted by applicable
law.


                                      S-59


                                USE OF PROCEEDS

     The net proceeds from the sale of the Offered Certificates will be applied
by the Depositor, or an affiliate thereof, toward the purchase of the Mortgage
Loans and the repayment of any related financing. The Mortgage Loans will be
acquired by the Depositor from the Seller in a privately negotiated
transaction. Immediately prior to the sale of the Mortgage Loans to the
Depositor, the Mortgage Loans were subject to financing provided by an
affiliate of the Underwriter. The Depositor will apply a portion of the
proceeds from the sale of the Certificates to repay the financing.


                                 UNDERWRITING

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

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

     Expenses incurred by the Depositor in connection with this offering are
expected to be approximately $405,000.

     Lehman Brothers Inc. has entered into an agreement with the Depositor to
purchase the Class B4, Class B5 and Class B6 Certificates simultaneously with
the purchase of the Offered Certificates, subject to certain conditions.

     Lehman Brothers Inc. is an affiliate of the Depositor, Lehman Holdings,
Lehman Bank and the Master Servicer.

     After the initial distribution of the Offered Certificates by the
Underwriter, the Prospectus and Prospectus Supplement may be used by the
Underwriter in connection with market making transactions in the Offered
Certificates. The Underwriter may act as principal or agent in such
transactions. Such transactions will be at prices related to prevailing market
prices at the time of sale.


                                 LEGAL MATTERS

     Certain legal matters with respect to the Certificates will be passed upon
for the Depositor and for the Underwriter by Dechert LLP, New York, New York.


                                    RATINGS

     It is a condition to the issuance of the Senior Certificates (other than
the Class A3 Certificates) that they be rated "Aaa" by Moody's Investors
Service, Inc. ("Moody's") and "AAA" by Standard & Poor's Ratings Services, a
division of The McGraw-Hill Companies, Inc. ("S&P," and together with Moody's,
the "Rating Agencies"). It is a condition to the issuance of the Class B1
Certificates that they be rated "AA" by S&P. It is a condition to the issuance
of the Class B2 Certificates that they be rated "A" by S&P. It is a condition
to the issuance of the Class B3 Certificates that they be rated "BBB" by S&P.

     The ratings of "AAA" and "Aaa" are the highest ratings that the applicable
Rating Agency assigns to securities. A securities rating is not a
recommendation to buy, sell or hold securities and


                                      S-60


may be subject to revision or withdrawal at any time by the assigning Rating
Agency. A securities rating addresses the likelihood of receipt by holders of
Offered Certificates of distributions in the amount of scheduled payments on
the Mortgage Loans. The rating takes into consideration the characteristics of
the Mortgage Loans and the structural and legal aspects associated with the
Offered Certificates. The ratings do not take into consideration any of the tax
aspects associated with the Offered Certificates.


     The ratings of the Interest-Only Certificates do not address whether
investors in those Certificates will fail to recoup their initial investments
due to a faster than anticipated rate of prepayments. The ratings of the Class
R Certificate do not assess the likelihood of return to investors except to the
extent of the Class Principal Amount and interest thereon.


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


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


                                      S-61


                            INDEX OF PRINCIPAL TERMS






DEFINED TERM                                        PAGE
------------                                       ----

Accrual Period ....................................S-23
Accrued Certificate Interest ......................S-20
Act ...............................................S-60
Advance ...........................................S-42
Auction Administrator .............................S-23
Aurora ............................................S-23
Aurora Underwriting Guidelines ....................S-37
Available Distribution Amount .....................S-27
Available Funds Cap ...............................S-22
Bankruptcy Loss Limit .............................S-30
Bankruptcy Losses .................................S-30
Basis Risk Protected Certificate ..................S-54
Beneficial Owner ..................................S-15
Book-Entry Certificates ...........................S-15
Business Day ......................................S-14
Callable Certificates .............................S-14
Certificate Principal Amount ......................S-22
Certificateholder .................................S-16
Certificates ......................................S-14
Class .............................................S-14
Class A2 Auction Holders ..........................S-56
Class Notional Amount .............................S-14
Class Percentage ..................................S-20
Class Principal Amount ............................S-14
Clearstream Luxembourg ............................S-15
Clearstream Luxembourg Participants ...............S-17
Closing Date ......................................S-20
Code ..............................................S-54
Colonial Savings ..................................S-41
Corporate Trust Office ............................S-31
Credit Support Percentage .........................S-20
Cut-off Date ......................................S-25
Cut-off Date Balance ..............................S-32
Debt Service Reduction ............................S-30
Deficient Valuation ...............................S-30
Definitive Certificate ............................S-15
Deposit Date ......................................S-27
Depositor .........................................S-15
Distribution Date .................................S-14
DTC ...............................................S-15
Due Period ........................................S-26
Employee Discount Rate ............................S-32
Employee Mortgage Loans ...........................S-32
ERISA .............................................S-58
ERISA Plans .......................................S-58
Euroclear .........................................S-15
Euroclear Operator ................................S-17
Euroclear Participants ............................S-17
European Depositaries .............................S-16
Excess Interest Payments ..........................S-54
Excess Losses .....................................S-30





DEFINED TERM                                        PAGE
------------                                        ----

Exemption .........................................S-58
Final Scheduled Distribution Date .................S-30
Financial Intermediary ............................S-16
First Auction Distribution Date ...................S-22
Fraud Loss Limit ..................................S-30
Fraud Losses ......................................S-30
General Underwriting Guidelines ...................S-37
Insurance Proceeds ................................S-27
Interest Rate Cap Agreements ......................S-54
Interest Shortfall ................................S-21
Interest-Only Certificates ........................S-14
Lehman Bank .......................................S-40
Lehman Holdings ...................................S-32
Lehman Originated Mortgage Loans ..................S-44
Liquidated Mortgage Loan ..........................S-30
Liquidation Proceeds ..............................S-28
Loan-to-Value Ratio ...............................S-33
Master Servicer ...................................S-39
Master Servicing Fee ..............................S-42
Minimum Call Price ................................S-23
Modeling Assumptions ..............................S-49
Moody's ...........................................S-60
Mortgage Loans ....................................S-14
Mortgage Pool .....................................S-14
Mortgage Rate .....................................S-22
Mortgaged Property ................................S-32
Net Mortgage Rate .................................S-22
Net Prepayment Interest Shortfalls ................S-23
Net WAC ...........................................S-21
Notional Amount ...................................S-22
Offered Certificates ..............................S-14
Offered Subordinate Certificates ..................S-14
OID ...............................................S-54
Original Credit Support Percentage ................S-20
Original Subordinate Amount .......................S-26
Originators .......................................S-32
Participant .......................................S-16
Penalty Period ....................................S-46
Percentage Interest ...............................S-15
Plans .............................................S-59
Pool Balance ......................................S-25
Prepayment Assumption .............................S-49
Prepayment Interest Excess ........................S-23
Prepayment Interest Shortfall .....................S-23
Prepayment Penalty Amount .........................S-46
Prepayment Period .................................S-27
Principal Distribution Amount .....................S-24
Principal Prepayments .............................S-27
PTCE ..............................................S-59
Rating Agencies ...................................S-60
Realized Loss .....................................S-29


                                      S-62







DEFINED TERM                                        PAGE
------------                                        ----

Record Date .......................................S-14
Relevant Depositary ...............................S-16
Relief Act ........................................S-21
Relief Act Reduction ..............................S-21
REMIC .............................................S-54
Residual Certificate ..............................S-15
Restricted Classes ................................S-20
Rules .............................................S-16
Sale Agreement ....................................S-44
Sale and Assignment Agreement .....................S-44
Sale Date .........................................S-44
Scheduled Payment .................................S-32
Scheduled Principal Balance .......................S-25
Seller ............................................S-32
Senior Certificates ...............................S-14
Senior Percentage .................................S-25
Senior Prepayment Percentage ......................S-25
Senior Principal Distribution Amount ..............S-24
Servicer Remittance Date ..........................S-27
Servicing Fee .....................................S-42
Servicing Fee Rate ................................S-42
SMMEA .............................................S-58
Special Hazard Loss Limit .........................S-30





DEFINED TERM                                       PAGE
------------                                       ----

Special Hazard Losses .............................S-30
Subordinate Amount ................................S-26
Subordinate Certificate Writedown
Amount ............................................S-29
Subordinate Certificates ..........................S-14
Subordinate Class Percentage ......................S-26
Subordinate Percentage ............................S-26
Subordinate Prepayment Percentage .................S-26
Subordinate Principal Distribution Amount .........S-26
Subsequent Recovery ...............................S-28
S&P ...............................................S-60
Tax Counsel .......................................S-54
Terms and Conditions ..............................S-18
Transferor ........................................S-44
Transferred Mortgage Loans ........................S-44
Trust Agreement ...................................S-43
Trust Fund ........................................S-14
Trustee ...........................................S-31
Underwriter .......................................S-60
Underwriting Agreement ............................S-60
Underwriting Guidelines ...........................S-32



                                      S-63



                     [THIS PAGE INTENTIONALLY LEFT BLANK.]





                                    ANNEX A:


         GLOBAL CLEARANCE, SETTLEMENT AND TAX DOCUMENTATION PROCEDURES

     Except in certain limited circumstances, the globally offered Structured
Asset Securities Corporation Mortgage Pass-Through Certificates, Series 2004-22
(the "Global Securities") will be available only in book-entry form. Investors
in the Global Securities may hold such Global Securities through any of 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 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 loan asset backed
certificates 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.

     A holder that is not a United States person (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 Relevant 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 loan asset backed
certificates 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. 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
loan asset backed certificates 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.


                                      A-1


     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 Relevant
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 Relevant 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.

     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 Relevant 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 Relevant 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,


                                      A-2


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 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 the 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 or Euroclear Participant.

CERTAIN U.S. FEDERAL INCOME TAX DOCUMENTATION REQUIREMENTS

     A holder that is not a "United States person" within the meaning of
Section 7701(a) (30) of the Internal Revenue Code of 1986 holding a book-entry
certificate through Clearstream, Euroclear or DTC may be subject to U.S.
withholding tax at a rate of 30% unless such holder provides certain
documentation to the Trustee or to the U.S. entity required to withhold tax
(the "U.S. withholding agent") establishing an exemption from withholding. A
holder that is not a United States person may be subject to 30% withholding
unless:

     I. the Trustee or the U.S. withholding agent receives a statement --

       (a) from the holder on Internal Revenue Service ("IRS") Form W-8BEN (or
    any successor form) that

          (i) is signed by the holder under penalties of perjury,

          (ii) certifies that such owner is not a United States person, and

          (iii) provides the name and address of the holder, or

       (b) from a securities clearing organization, a bank or other financial
    institution that holds customers' securities in the ordinary course of its
    trade or business that --

          (i) is signed under penalties of perjury by an authorized
        representative of the financial institution,

          (ii) states that the financial institution has received an IRS Form
        W-8BEN (or any successor form) from the holder or that another
        financial institution acting on behalf of the holder has received such
        IRS Form W-8BEN (or any successor form),

          (iii) provides the name and address of the holder, and

                                      A-3


          (iv) attaches the IRS Form W-8BEN (or any successor form) provided by
     the holder;


     II. the holder claims an exemption or reduced rate based on a treaty and
provides a properly executed IRS Form W-8BEN (or any successor form) to the
Trustee or the U.S. withholding agent;


     III. the holder claims an exemption stating that the income is effectively
connected to a U.S. trade or business and provides a properly executed IRS Form
W-8ECI (or any successor form) to the Trustee or the U.S. withholding agent; or



     IV. the holder is a "nonwithholding partnership" and provides a properly
executed IRS Form W-8IMY (or any successor form) with all necessary attachments
to the Trustee or the U.S. withholding agent. Certain pass-through entities
that have entered into agreements with the Internal Revenue Service (for
example "qualified intermediaries") may be subject to different documentation
requirements; it is recommended that such holders consult with their tax
advisors when purchasing the Certificates.


     A holder holding book-entry certificates through Clearstream or Euroclear
provides the forms and statements referred to above by submitting them to the
person through which he holds an interest in the book-entry certificates, which
is the clearing agency, in the case of persons holding directly on the books of
the clearing agency. Under certain circumstances a Form W-8BEN, if furnished
with a taxpayer identification number, ("TIN"), will remain in effect until the
status of the beneficial owner changes, or a change in circumstances makes any
information on the form incorrect. A Form W-8BEN, if furnished without a TIN,
and a Form W 8ECI will remain in effect for a period starting on the date the
form is signed and ending on the last day of the third succeeding calendar
year, unless a change in circumstances makes any information on the form
incorrect. In addition, all holders holding book-entry certificates through
Clearstream, Euroclear or DTC may be subject to backup withholding unless the
holder:


     I. provides a properly executed IRS Form W-8BEN, Form W-8ECI or Form
W-8IMY (or any successor forms) if that person is not a United States person;


     II. provides a properly executed IRS Form W-9 (or any substitute form) if
that person is a United States person; or


     III.  is a corporation, within the meaning of Section 7701(a) of the
Internal Revenue Code of 1986, or otherwise establishes that it is a recipient
exempt from United States backup withholding.


     This summary does not deal with all aspects of federal income tax
withholding or backup withholding that may be relevant to investors that are
not "United States persons" within the meaning of Section 7701(a) (30) of the
Internal Revenue Code. Such investors are advised to consult their own tax
advisors for specific tax advice concerning their holding and disposing of the
book-entry certificates.


     The term "United States person" means (1) a citizen or resident of the
United States, (2) a corporation or partnership organized in or under the laws
of the United States or any state thereof or the District of Columbia (other
than a partnership that is not treated as a United States person under any
applicable Treasury regulations), (3) an estate the income of which is
includible in gross income for United States tax purposes, regardless of its
source, (4) 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, and (5) to the extent provided in regulations, certain trusts in
existence on August 20, 1996 that are treated as United States persons prior to
such date and that elect to continue to be treated as United States persons.


     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-4

PROSPECTUS



                    STRUCTURED ASSET SECURITIES CORPORATION
                                   DEPOSITOR
                           ASSET-BACKED CERTIFICATES
                               ASSET-BACKED NOTES
                             (ISSUABLE IN SERIES)

                               ----------------
EACH TRUST FUND:


   o may periodically issue asset-backed pass-through certificates or asset
     backed notes, in each case in one or more series with one or more classes;
     and

   o will be established to hold assets transferred to it by Structured Asset
     Securities Corporation, including:

   o mortgage loans or participation interests in mortgage loans, including
     manufactured home loans;

   o mortgage backed certificates insured or guaranteed by Fannie Mae, Freddie
     Mac or Ginnie Mae;

   o private mortgage backed certificates, as described in this prospectus; and

   o payments due on those mortgage loans and mortgage backed certificates.

     The assets in your trust fund will be specified in the prospectus
supplement for your trust fund, while the types of assets that may be included
in a trust fund, whether or not included in your trust fund, are described in
greater detail in this prospectus.

THE SECURITIES:

   o will be offered for sale pursuant to a prospectus supplement;

   o will evidence beneficial ownership of, or be secured by, the assets in the
     related trust fund and will be paid only from the trust fund assets
     described in the related prospectus supplement; and

   o may have one or more forms of credit enhancement.

     The securityholders will receive distributions of principal and interest
that are dependent upon the rate of payments, including prepayments, on the
mortgage loans, mortgage backed certificates and other assets in the trust fund.

     The prospectus supplement will state whether the securities are expected to
be classified as indebtedness and whether the trust will make a REMIC or FASIT
election for federal income tax purposes.

     The Attorney General of the State of New York has not passed on or endorsed
the merits of this offering. Any representation to the contrary is unlawful.

     NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED THESE SECURITIES OR DETERMINED THAT THIS PROSPECTUS IS
ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.


                                LEHMAN BROTHERS



               The date of this prospectus is November 19, 2004


                         DESCRIPTION OF THE SECURITIES

GENERAL

     The asset-backed certificates (the "Certificates") of each series
(including any class of certificates not offered hereby) will represent the
entire beneficial ownership interest in the trust fund created pursuant to the
related Agreement (as defined herein). A series of Securities may also include
asset-backed notes (the "Notes," and together with the Certificates, the
"Securities") that will represent indebtedness of the related trust fund and
will be issued pursuant to an indenture. See "The Agreements."

     Each series of Securities will consist of one or more classes of
Securities, one or more of which may:

     o  accrue interest based on a variable or adjustable rate ("Floating Rate
        Securities");

     o  provide for the accrual of interest, which is periodically added to the
        principal balance of the Securities, but on which no interest or
        principal is payable except during any periods specified in the
        prospectus supplement ("Compound Interest Securities");

     o  be entitled to a greater percentage of interest on the Loans underlying
        or comprising the Primary Assets for the series than the percentage of
        principal on the Loans to which the Securities are entitled ("Interest
        Weighted Securities");

     o  be entitled to a greater percentage of principal on the Loans underlying
        or comprising the Primary Assets for the series than the percentage of
        interest on the Loans to which the Securities are entitled ("Principal
        Weighted Securities");

     o  not be entitled to principal until the earlier of the date specified in
        the prospectus supplement or the date on which the principal of all
        Securities of the series having an earlier Final Scheduled Distribution
        Date have been paid in full ("Planned Amortization Certificates" or
        "PACs");

     o  be subordinate to one or more other classes of Securities in respect of
        receiving distributions of principal and interest, to the extent and
        under the circumstances specified in the prospectus supplement
        ("Subordinate Securities"); and/or

     o  be other types of Securities, as described in the prospectus supplement.

     If specified in the prospectus supplement, distributions on one or more
classes of a series of Securities may be limited to collections from a
designated portion of the assets in the related trust fund (each portion of
Assets, an "Asset Group").

     Each class of Securities offered by this prospectus and the prospectus
supplement (the "Offered Securities") will be issued in the minimum original
principal amount or notional amount for Securities of each class specified in
the prospectus supplement. The transfer of any Offered Securities may be
registered, and those Securities may be exchanged, without the payment of any
service charge. The classes of Securities of a series may be issued in fully
registered, certificated form ("Definitive Securities") or issued in book-entry
form only ("Book-Entry Securities") Book-Entry Securities in specified minimum
denominations and integral multiples thereof, as provided in the prospectus
supplement. See "-- Book-Entry Registration."

DISTRIBUTIONS ON THE SECURITIES

     General

     Distributions on the Securities of each series will be made by or on
behalf of the trustee from the Available Distribution Amount for that series,
on each Distribution Date, as specified in the prospectus supplement.
Distributions (other than the final distribution) will be made to the persons
in whose names the Securities are registered on the close of business on the
record date specified in the prospectus supplement. Payments will be made by
check mailed to the registered owners at their


                                       2


addresses appearing on the Security Register, or by wire transfer (at the
expense of the securityholder requesting payment by wire transfer) in certain
circumstances described in the prospectus supplement; provided, however, that
the final distribution in retirement of a Security will be made only upon
presentation and surrender of the Security at the corporate trust office of the
trustee or as otherwise specified in the prospectus supplement. Advance notice
of the final distribution on a Security will be mailed to the securityholders.

     Distributions of interest on Securities entitled to receive interest will
be made periodically at the intervals and Interest Rates specified or determined
in accordance with the prospectus supplement. Interest on the Securities will be
calculated on the basis of a 360-day year consisting of 12 30-day months, unless
the prospectus supplement specifies a different basis. Distributions of
principal on each class of Securities in a series will be made on a pro rata or
random lot basis among all of the Securities of the class, or as otherwise
specified in the prospectus supplement.

     The funds in the Distribution Account (together with any amounts
transferred from any Reserve Fund or applicable credit support) may be
insufficient to make the full distribution to securityholders on a Distribution
Date. In this case, the funds available for distribution to the securityholders
of each class will be distributed in accordance with their respective interests.
However, as described in the prospectus supplement, holders of Securities will
receive their current distributions and past amounts due but unpaid to them
before holders of Subordinate Securities are paid (in each case, these amounts
are calculated as described in the prospectus supplement). The difference
between the amount that the securityholders would have received if there had
been sufficient eligible funds available for distribution and the amount
actually distributed will be included in the calculation of the amount that the
securityholders are entitled to receive on the next Distribution Date.

     For a description of the reports to be furnished to securityholders
concerning a distribution, see "The Agreements -- Reports to Securityholders."

     Single Class Securities Generally

     With respect to a series of Securities that is not a Multi-Class Series,
distributions on the Securities on each Distribution Date will generally be
allocated to each Security entitled to payment on the basis of the undivided
percentage interest (the "Percentage Interest") evidenced by the Security, or on
the basis of the Security's outstanding principal amount or notional amount
(subject to any subordination of the rights of any classes of Subordinate
Securities to receive current distributions), as specified in the prospectus
supplement. See "-- Subordinate Securities" below.

     If the Primary Assets for a series of Securities have adjustable or
variable interest rates, then the rate at which interest accrues on the
principal balance of the Securities or on a class in the series (the "Interest
Rate") may also vary, due to changes in prevailing interest rates and due to
prepayments on Loans comprising or underlying the Primary Assets. If the Primary
Assets for a series have fixed interest rates, then the Interest Rate on
Securities of a series may be fixed, or may vary, to the extent prepayments
cause changes in the weighted average interest rate of the Primary Assets. If
the Primary Assets have lifetime or periodic adjustment caps on their respective
rates, then the Interest Rate on the Securities of the related series may also
reflect those caps.

     If specified in the prospectus supplement, a series of Securities may
include one or more classes that are Interest Weighted Securities, Principal
Weighted Securities, or both. Unless otherwise specified in the prospectus
supplement, payments received from the Primary Assets will be allocated on the
basis of the Percentage Interest of each class in the principal component of the
distributions, the interest component of the distributions, or both, and will be
further allocated on a pro rata basis among the Securities within each class.
The method or formula for determining the Percentage Interest of a Security will
be set forth in the prospectus supplement.

     Multi-Class Series

     A series of Securities may include Floating Rate Securities, Compound
Interest Securities and Planned Amortization Certificates, and/or classes of
Subordinate Securities and Senior Securities (a "Multi-Class Series"). For a
series of Securities that is not a Multi-Class Series, each class is


                                       3


designated to receive a particular portion of future principal or interest cash
flows on the Primary Assets. This designation does not change over the term of
the Securities unless the series has a subordination feature in one or more
classes of Subordinate Securities that protects one or more classes of Senior
Securities in the event of failure of timely payment of the Primary Assets.
Unless otherwise specified in the prospectus supplement, each Security of a
Multi-Class Series will have a principal amount or a notional amount and a
specified Interest Rate (that may be zero). Interest distributions on a
Multi-Class Series will be made on each Security entitled to an interest
distribution on each Distribution Date at the Interest Rate specified in or
determined in accordance with the prospectus supplement, to the extent funds are
available in the Distribution Account, subject to any subordination of the
rights of any classes of Subordinate Securities to receive current
distributions. See "-- Subordinate Securities" below and "Credit Support --
Subordinate Securities; Subordination Reserve Fund."

     Distributions of interest on Compound Interest Securities will begin only
after the related accretion termination date specified in the prospectus
supplement. On each Distribution Date on or before the accretion termination
date, interest on the Compound Interest Securities accrues, and the amount of
interest accrued is added on each Distribution Date to the principal balance of
the Security. On each Distribution Date after the accretion termination date,
interest distributions will be made on classes of Compound Interest Securities
on the basis of the current Compound Value of the class. The "Compound Value" of
a class of Compound Interest Securities equals the initial aggregate principal
balance of the class, plus accrued and undistributed interest added to the class
through the immediately preceding Distribution Date, less any principal
distributions previously made to reduce the aggregate outstanding principal
balance of the class.

     A Multi-Class Series may also include one or more classes of Floating Rate
Securities. The Interest Rate of a Floating Rate Security will be a variable or
adjustable rate, which may be subject to a maximum floating rate, a minimum
floating rate, or both, as specified in the prospectus supplement. For each
class of Floating Rate Securities, the prospectus supplement will set forth the
initial Floating Rate (or the method of determining it), the period during which
the Floating Rate applies, and the formula, index, or other method by which the
Floating Rate for each period will be determined.

     Distributions of principal will be allocated among the classes of a
Multi-Class Series in the order of priority and amount specified in the
prospectus supplement. Generally, the "Principal Distribution Amount" for a
Multi-Class Series on any Distribution Date will be equal to the sum of (1) the
accrual distribution amount for any Compound Interest Securities, (2) the
Minimum Principal Distribution Amount and (3) the percentage, if any, of the
excess cash flow specified in the prospectus supplement. The "Minimum Principal
Distribution Amount" is the amount, if any, by which the outstanding principal
balance of the Securities of a series (before giving effect to any payment of
principal on that Distribution Date) exceeds the aggregate value of the Primary
Assets as of that Distribution Date.

     Subordinate Securities

     A series of Securities may include one or more classes of Subordinate
Securities that provide some or all of the credit support for the Senior
Securities in the series. The rights of holders of some classes of securities
(the "Subordinate Securities") to receive distributions will be subordinate in
right and priority to the rights of holders of senior securities of the series
(the "Senior Securities") but only to the extent described in the prospectus
supplement. If the Primary Assets are divided into separate Asset Groups,
evidenced by separate classes, credit support may be provided by a cross-support
feature. This feature requires that distributions be made to Senior Securities
prior to making distributions on Subordinate Securities backed by assets in
another Asset Group within the trust fund. Unless rated in one of the four
highest rating categories by at least one nationally recognized statistical
rating organization (each, a "Rating Agency"), Subordinate Securities will not
be offered by this prospectus or the prospectus supplement. See "Credit Support
-- Subordinate Securities; Subordination Reserve Fund."

OPTIONAL TERMINATION

     If specified in the prospectus supplement for a series of Securities, the
depositor, the servicer or master servicer, or any other designated entity may,
at its option, purchase or direct the sale of a


                                       4


portion of the Primary Assets of the trust fund, or cause an early termination
of the trust fund by repurchasing all of the Primary Assets from the trust fund
or directing the sale of the Primary Assets. This termination may occur on a
date on or after the date on which either (1) the Aggregate Asset Principal
Balance of the Primary Assets is less than a specified percentage of the initial
Aggregate Asset Principal Balance, or (2) the aggregate principal amount of the
Securities (or of certain classes in a series) is less than a specified
percentage of their initial aggregate principal amount, as described in the
prospectus supplement.

     o  "Asset Principal Balance" means, for any Loan at the time of
        determination, its outstanding principal balance as of the Cut-off Date,
        reduced by all amounts distributed to securityholders (or used to fund
        the Subordination Reserve Fund, if any) and reported as allocable to
        principal payments on the Loan.

     o  "Aggregate Asset Principal Balance" means, at the time of determination,
        the aggregate of the Asset Principal Balances of all the Loans in a
        trust fund.

     The optional termination described in this section will be in addition to
terminations that may result from other events. See "The Agreements -- Event of
Default; Rights Upon Event of Default" and "-- Termination."

OPTIONAL PURCHASE OF SECURITIES

     The prospectus supplement for a series of Securities may provide that one
or more classes of the series may be purchased, in whole or in part, at the
option of the depositor, the servicer or master servicer, or another designated
entity, at specified times and purchase prices, and under particular
circumstances. Notice of any purchase must be given by the trustee prior to the
optional purchase date, as specified in the prospectus supplement.

OTHER PURCHASES

     If specified in the prospectus supplement for a series, any class of
Securities in the series may be subject to redemption, in whole or in part, at
the request of the holders of that class or mandatory purchase by the depositor,
the servicer or master servicer, or another designated entity. The terms and
conditions of any redemption or mandatory purchase with respect to a class of
Securities will be described in the prospectus supplement.

     The depositor may also have the option to obtain for any series of
Securities, one or more guarantees from a company or companies acceptable to the
Rating Agencies. As specified in the prospectus supplement, these guarantees may
provide for one or more of the following for any series of Securities:

     o  call protection for any class of Securities of a series;

     o  a guarantee of a certain prepayment rate of some or all of the Loans
        underlying the series; or

     o  certain other guarantees described in the prospectus supplement.

BOOK-ENTRY REGISTRATION

     General

     If provided for in the prospectus supplement, one or more classes of the
Offered Securities of any series will be issued as Book-Entry Securities, and
each of these classes will be represented by one or more single Securities
registered in the name of a nominee for the depository, The Depository Trust
Company ("DTC") and, if provided in the prospectus supplement, additionally
through Clearstream Banking, societe anonyme (formerly Cedelbank) (referred to
herein as "Clearstream") or Euroclear Bank S.A./NV as operator of the Euroclear
System ("Euroclear"). Each class of Book-Entry Securities will be issued in one
or more certificates or notes, as the case may be, that equal the initial
principal amount of the related class of Offered Securities and will initially
be registered in the name of Cede & Co.


                                       5


     No person acquiring an interest in a Book-Entry Security (each, a
"Beneficial Owner") will be entitled to receive a Definitive Security, except
as set forth below under "-- Definitive Securities." Unless and until
Definitive Securities are issued for the Book-Entry Securities under the
limited circumstances described in the related prospectus supplement or this
prospectus, all references to actions by securityholders with respect to the
Book-Entry Securities will refer to actions taken by DTC, Clearstream or
Euroclear upon instructions from their Participants (as defined below), and all
references herein to distributions, notices, reports and statements to
securityholders with respect to the Book-Entry Securities will refer to
distributions, notices, reports and statements to DTC, Clearstream or
Euroclear, as applicable, for distribution to Beneficial Owners by DTC in
accordance with the procedures of DTC and if applicable, Clearstream and
Euroclear.

     Beneficial Owners will hold their Book-Entry Securities through DTC in the
United States, or, if the Offered Securities are offered for sale globally,
through Clearstream or Euroclear in Europe if they are participating
organizations ("Participants") of those systems. Participants include securities
brokers and dealers, banks, trust companies and clearing corporations and may
include some other organizations. Indirect access to the DTC, Clearstream and
Euroclear systems also is available to others, 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").

     DTC

     DTC is a limited-purpose trust company organized under the laws of the
State of New York, a member of the Federal Reserve System, a "clearing
corporation" within the meaning of the Uniform Commercial Code and a "clearing
agency" registered pursuant to the provisions of Section 17A of the Securities
Exchange Act of 1934, as amended. DTC was created to hold securities for its
Participants, some of which (and/or their representatives) own DTC, and
facilitate the clearance and settlement of securities transactions between its
Participants through electronic book-entry changes in their accounts, thereby
eliminating the need for physical movement of securities. In accordance with its
normal procedures, DTC is expected to record the positions held by each of its
Participants in the Book-Entry Securities, whether held for its own account or
as a nominee for another person. In general, beneficial ownership of Book-Entry
Securities will be subject to the rules, regulations and procedures governing
DTC and its Participants as in effect from time to time.

     Clearstream

     Clearstream is incorporated under the laws of the Grand Duchy of Luxembourg
as a professional depository. Clearstream holds securities for its Participants
and facilitates the clearance and settlement of securities transactions between
its Participants through electronic book-entry changes in accounts of its
Participants or between a Clearstream account and a Euroclear account, thereby
eliminating the need for physical movement of certificates. For transactions
between a Clearstream participant and a participant of another securities
settlement system, Clearstream generally adjusts to the settlement rules of the
other securities settlement system. Transactions may be settled in Clearstream
in numerous currencies, including United States dollars. Clearstream provides to
its Participants, among other things, services for safekeeping, administration,
clearance and settlement of internationally-traded securities and securities
lending and borrowing. Clearstream interfaces with domestic markets in several
countries. As a professional depository, Clearstream is subject to regulation by
the Luxembourg Commission de Surveillance du Secteur Financier, "CSSF."
Participants of Clearstream 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 is also available to others, such as banks, brokers,
dealers and trust companies that clear through or maintain a custodial
relationship with a Participant of Clearstream, either directly or indirectly.
Clearstream has established an electronic bridge with Euroclear to facilitate
settlement of trades between Clearstream and Euroclear.

     Euroclear

     Euroclear was created in 1968 to hold securities for its Participants and
to clear and settle transactions between its Participants through simultaneous
electronic book-entry delivery against


                                       6


payment, thereby eliminating the need for physical movement of securities and
any risk from lack of simultaneous transfers of securities and cash.
Transactions may be settled in numerous 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./NV (the "Euroclear
Operator"), under contract with Euroclear Clearance Systems S.C., a Belgian
cooperative corporation (the "Cooperative Corporation"). 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 Corporation. The Cooperative Corporation establishes policy
for Euroclear on behalf of its 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 Participant of Euroclear, either directly or indirectly.

     The Euroclear Operator has advised us that it is licensed by the Belgian
Banking and Finance Commission to carry out banking activities on a global
basis. As a Belgian bank, it is regulated and examined by the Belgian Banking
Commission.

     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 securities to specific securities clearance accounts.
The Euroclear Operator acts under the Terms and Conditions only on behalf of its
Participants, and has no record of or relationship with persons holding through
Participants of Euroclear.

     Payments with respect to Securities held through Clearstream or Euroclear
will be credited to the cash accounts of Clearstream Participants or Euroclear
Participants in accordance with the relevant system's rules and procedures, to
the extent received by its respective depositary (individually the "Relevant
Depositary" and collectively, the "European Depositaries"). Those payments will
be subject to tax withholding in accordance with relevant United States tax laws
and regulations. Clearstream or the Euroclear Operator, as the case may be, will
take any other action permitted to be taken by a Securityholder on behalf of a
Clearstream Participant or Euroclear Participant only in accordance with its
relevant rules and procedures and subject to its depositary's ability to effect
those actions on its behalf through DTC.

     DTC, Clearstream and Euroclear are under no obligation to perform or
continue to perform the foregoing procedures and such procedures may be
discontinued at any time.

     Beneficial Ownership of Book-Entry Securities

     Except as described below, no Beneficial Owner will be entitled to receive
a physical certificate representing a Certificate or a Note. Unless and until
Definitive Securities are issued, it is anticipated that the only
"securityholder" of the Offered Securities will be Cede & Co., as nominee of
DTC. Beneficial Owners will not be "Certificateholders" or "Noteholders" as
those terms are used in the related Agreement. Beneficial Owners are only
permitted to exercise their rights indirectly through Participants, DTC,
Clearstream or Euroclear, as applicable.

     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 (each, a "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 Participant 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 Participant of DTC and on
the records of Clearstream or Euroclear, as appropriate).


                                       7


     Beneficial Owners will receive all distributions of principal of, and
interest on, the Offered Securities from the trustee through DTC and its
Participants. While the Offered Securities 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 Offered Securities and is required to receive and transmit
distributions of principal of, and interest on, the Offered Securities.
Participants and Indirect Participants with whom Beneficial Owners have accounts
with respect to Offered Securities are similarly required to make book-entry
transfers and receive and transmit distributions on behalf of their respective
Beneficial Owners. Accordingly, although Beneficial Owners will not possess
certificates or notes, the Rules provide a mechanism by which Beneficial Owners
will receive distributions and will be able to transfer their interest.

     Beneficial Owners will not receive or be entitled to receive certificates
or notes representing their respective interests in the Offered Securities,
except under the limited circumstances described below. Unless and until
Definitive Securities are issued, Beneficial Owners who are not Participants may
transfer ownership of Offered Securities only through Participants and Indirect
Participants by instructing the Participants and Indirect Participants to
transfer Offered Securities, by book-entry transfer, through DTC for the account
of the purchasers of the Offered Securities, which account is maintained with
their respective Participants. Under the Rules and in accordance with DTC's
normal procedures, transfer of ownership of Book-Entry Securities 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 Beneficial Owners.

     Because of time zone differences, any credits of securities received in
Clearstream 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. These credits or any transactions in
securities settled during this processing will be reported to the relevant
Participants of Clearstream or Euroclear on that business day. Cash received in
Clearstream or Euroclear as a result of sales of securities by or through a
Participant of Clearstream or Euroclear to a Participant of DTC will be received
with value on the DTC settlement date but will be available in the relevant
Clearstream 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 Securities, see "Material Federal Income Tax Considerations --
Taxation of Securities Treated as Debt Instruments -- Foreign Persons," "--
REMIC Residual Certificates -- Foreign Persons," "-- Grantor Trust Certificates
-- Foreign Persons" and "-- Partner Certificates -- Foreign Persons" herein and,
if the Book-Entry Securities are globally offered and the prospectus supplement
so provides, see "Global Clearance, Settlement and Tax Documentation Procedures
-- Certain U.S. Federal Income Tax Documentation Requirements" in Annex A to the
prospectus supplement.

     Transfers between Participants of DTC will occur in accordance with DTC
Rules. Transfers between Participants of Clearstream or Euroclear 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 Participants of
Clearstream or Euroclear, on the other, will be effected in DTC in accordance
with the DTC Rules on behalf of the relevant European international clearing
system by the Relevant Depositary; however, cross-market transactions will
require delivery of instructions to the relevant European international clearing
system by the counterparty in that 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. Participants of
Clearstream or Euroclear may not deliver instructions directly to the European
Depositaries.

     Distributions on the Book-Entry Securities will be made on each
Distribution Date by the trustee to DTC. DTC will be responsible for crediting
the amount of each distribution to the accounts of the


                                       8


applicable Participants of DTC in accordance with DTC's normal procedures. Each
Participant of DTC will be responsible for disbursing the distribution to the
Beneficial Owners of the Book-Entry Securities 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 Securities that it represents.

     Under a book-entry format, Beneficial Owners of the Book-Entry Securities
may experience some delay in their receipt of payments, because the
distributions will be forwarded by the trustee to Cede & Co. Any distributions
on Securities held through Clearstream or Euroclear will be credited to the cash
accounts of Participants of Clearstream or Euroclear in accordance with the
relevant system's rules and procedures, to the extent received by the Relevant
Depositary. These distributions will be subject to tax reporting in accordance
with relevant United States tax laws and regulations. See "Material Federal
Income Tax Considerations -- Taxation of Securities Treated as Debt Instruments
-- Foreign Persons," "-- REMIC Residual Certificates -- Administrative
Provisions," "-- Grantor Trust Certificates -- Trust Reporting" and "-- Partner
Certificates -- Information Reporting" herein. Because DTC can only act on
behalf of Financial Intermediaries, the ability of a Beneficial Owner to pledge
Book-Entry Securities to persons or entities that do not participate in the
depository system, or otherwise take actions in respect of Book-Entry
Securities, may be limited due to the lack of physical securities for the
Book-Entry Securities. In addition, issuance of the Book-Entry Securities in
book-entry form may reduce the liquidity of the securities in the secondary
market since certain potential investors may be unwilling to purchase Securities
for which they cannot obtain physical securities.

     Monthly and annual reports will be provided to Cede & Co., as nominee of
DTC, and may be made available by Cede & Co. 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 DTC accounts the
Book-Entry Securities of Beneficial Owners are credited.

     Generally, DTC will advise the applicable trustee that unless and until
Definitive Securities are issued, DTC will take any action permitted to be taken
by the holders of the Book-Entry Securities 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 actions are taken on
behalf of Financial Intermediaries whose holdings include the Book-Entry
Securities. If the Book-Entry Securities are globally offered, Clearstream or
the Euroclear Operator, as the case may be, will take any other action permitted
to be taken by a securityholder under the related Agreement, on behalf of a
Participant of Clearstream or Euroclear only in accordance with its relevant
rules and procedures and subject to the ability of the Relevant Depositary to
effect those actions on its behalf through DTC. DTC may take actions, at the
direction of the related Participants, with respect to some Offered Securities
that conflict with actions taken with respect to other Offered Securities.

     Although DTC, Clearstream and Euroclear have agreed to the foregoing
procedures in order to facilitate transfers of Book-Entry Securities among
Participants of DTC, Clearstream and Euroclear, they are under no obligation to
perform or continue to perform these procedures and the procedures may be
discontinued at any time.

     None of the depositor, any master servicer, any servicer, the trustee, any
securities registrar or paying agent or any of their affiliates will have any
responsibility for any aspect of the records relating to or payments made on
account of beneficial ownership interests of the Book-Entry Securities or for
maintaining, supervising or reviewing any records relating to those beneficial
ownership interests.

     Definitive Securities

     Securities initially issued in book-entry form will be issued as Definitive
Securities to Beneficial Owners or their nominees, rather than to DTC or its
nominee only (1) if DTC or the depositor advises the trustee in writing that DTC
is no longer willing or able to properly discharge its responsibilities as
depository for the Securities and the depositor is unable to locate a qualified
successor or (2) in accordance with any other provisions described in the
prospectus supplement.

     Upon the occurrence of any of the events described in the immediately
preceding paragraph, DTC is required to notify all Participants of the
availability through DTC of Definitive Securities for


                                       9


the Beneficial Owners. Upon surrender by DTC of the security or securities
representing the Book- Entry Securities, together with instructions for
registration, the trustee will issue (or cause to be issued) to the Beneficial
Owners identified in those instructions the Definitive Securities to which they
are entitled, and thereafter the trustee will recognize the holders of those
Definitive Securities as securityholders under the related Agreement.

                 YIELD, PREPAYMENT AND MATURITY CONSIDERATIONS

PAYMENT DELAYS

     With respect to any series, a period of time will elapse between receipt of
payments or distributions on the Primary Assets and the Distribution Date on
which the payments or distributions are paid to securityholders. This delay will
effectively reduce the yield that would otherwise be obtained if payments or
distributions were distributed on or near the date of receipt. The prospectus
supplement will set forth an example of the timing of receipts and the
distribution of collections to securityholders, so that the impact of this delay
can be understood.

PRINCIPAL PREPAYMENTS

     With respect to a series for which the Primary Assets consist of Loans or
participation interests in Loans, when a Loan prepays in full, the borrower will
generally be required to pay interest on the amount of the prepayment only to
the prepayment date. In addition, the prepayment may not be required to be paid
to securityholders until the month following receipt. The effect of these
provisions is to reduce the aggregate amount of interest that would otherwise be
available for distributions on the Securities. Therefore, the yield that would
be obtained if interest continued to accrue on the Loan until the principal
prepayment is paid to securityholders, is effectively reduced. To the extent
specified in the prospectus supplement, this effect on yield may be mitigated
by, among other things, an adjustment to the servicing fee otherwise payable to
the master servicer or servicer with respect to prepaid Loans. Further, if the
Interest Rate on a class of Securities in a series is based upon a weighted
average of the interest rates on the Loans comprising or underlying the Primary
Assets, interest on these Securities may be paid or accrued in the future at a
rate lower than the initial interest rate, to the extent that Loans bearing
higher rates of interest are prepaid more quickly than Loans bearing lower rates
of interest. See "Servicing of Loans -- Advances and Limitations Thereon."

TIMING OF REDUCTION OF PRINCIPAL AMOUNT

     A Multi-Class Series may provide that, for purposes of calculating interest
distributions, the principal amount of the Securities is deemed reduced as of a
date prior to the Distribution Date on which principal thereon is actually
distributed. Consequently, the amount of interest accrued during any interest
accrual period, as specified in the prospectus supplement, will be less than the
amount that would have accrued on the actual principal amount of the Securities
outstanding. The effect of these provisions is to produce a lower yield on the
Securities than would be obtained if interest were to accrue on the Securities
on the actual unpaid principal amount of the Securities to each Distribution
Date. The prospectus supplement will specify the time at which the principal
amounts of the Securities are determined or are deemed reduced for purposes of
calculating interest distributions on Securities of a Multi-Class Series.

INTEREST OR PRINCIPAL WEIGHTED SECURITIES

     If a class of Securities consists of Interest Weighted Securities or
Principal Weighted Securities, a lower rate of principal prepayments than
anticipated will negatively affect yield to investors in Principal Weighted
Securities, and a higher rate of principal prepayments than anticipated will
negatively affect yield to investors in Interest Weighted Securities. The
prospectus supplement will include a table showing the effect of various levels
of prepayment on yields on these types of Securities. The tables will illustrate
the sensitivity of yields to various prepayment rates and will not purport to
predict, or provide information enabling investors to predict, yields or
prepayment rates.


                                       10


FINAL SCHEDULED DISTRIBUTION DATE

     The prospectus supplement will specify the Final Scheduled Distribution
Date or Maturity Date for each class of a Multi-Class Series. The Maturity Date
for each class of Notes is the date on which the principal of the class of Notes
will be fully paid. The Final Scheduled Distribution Date for each class of
Certificates is the date on which the entire aggregate principal balance of the
class will be reduced to zero. These calculations will be based on the
assumptions described in the prospectus supplement. Because prepayments on the
Loans underlying or comprising the Primary Assets will be used to make
distributions in reduction of the outstanding principal amount of the
Securities, it is likely that the actual maturity of the class will occur
earlier, and may occur substantially earlier, than its Final Scheduled
Distribution Date. Furthermore, with respect to the Certificates, as a result of
delinquencies, defaults and liquidations of the assets in the trust fund, the
actual final distribution date of any Certificate may occur later than its Final
Scheduled Distribution Date.

PREPAYMENTS AND WEIGHTED AVERAGE LIFE

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

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

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

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

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

     The prospectus supplement for each Multi-Class Series will describe the
prepayment standard or model used to prepare any illustrative tables setting
forth the weighted average life of each class of


                                       11


that series under a given set of prepayment assumptions. The prospectus
supplement will also describe the percentage of the initial principal balance of
each class of a series that would be outstanding on specified Distribution Dates
for the series based on the assumptions stated in the prospectus supplement,
including assumptions that prepayments on the Loans comprising or underlying the
related Primary Assets are made at rates corresponding to various percentages of
CPR or SPA or at such other rates specified in the prospectus supplement. These
tables and assumptions are intended to illustrate the sensitivity of weighted
average life of the Securities to various prepayment rates and will not be
intended to predict or to provide information that will enable investors to
predict the actual weighted average life of the Securities or prepayment rates
of the Loans comprising or underlying the related Primary Assets.

OTHER FACTORS AFFECTING WEIGHTED AVERAGE LIFE

     Type of Loan

     Mortgage Loans secured by multifamily residential rental property or
cooperatively owned multifamily property consisting of five or more dwelling
units ("Multifamily Properties") may have provisions that prevent prepayment for
a number of years and may provide for payments of interest only during a certain
period followed by amortization of principal on the basis of a schedule
extending beyond the maturity of the related Mortgage Loan. ARMs, Bi- weekly
Loans, GEM Loans, GPM Loans or Buy-Down Loans comprising or underlying the
Primary Assets may experience a rate of principal prepayments that is different
from the principal prepayment rate for ARMs, Bi-weekly Loans, GEM Loans and GPM
Loans included in any other mortgage pool or from Conventional fixed rate Loans
or from other adjustable rate or graduated equity mortgages having different
characteristics. There can be no assurance as to the respective rates of
prepayment of these Loans in either stable or changing interest rate
environments.

     In the case of a Negatively Amortizing ARM, if interest rates rise without
a simultaneous increase in the related scheduled payment of principal and
interest (the "Scheduled Payment"), negative amortization may result or the
amount of interest accrued on the Stated Principal Balance thereof may exceed
the amount of interest paid by the mortgagor in any month (such excess,
"Deferred Interest"). However, borrowers may pay amounts in addition to their
Scheduled Payments in order to avoid negative amortization and to increase tax
deductible interest payments.

     To the extent that any of Mortgage Loans negatively amortize over their
respective terms, future interest accruals are computed on the higher
outstanding principal balance of the Mortgage Loan and a smaller portion of the
Scheduled Payment is applied to principal than would be required to amortize the
unpaid principal over its remaining term. Accordingly, the weighted average life
of the Mortgage Loans will increase.

     In a declining interest rate environment, the portion of each Scheduled
Payment in excess of the scheduled interest and principal due will be applied to
reduce the outstanding principal balance of the related Mortgage Loan, thereby
resulting in accelerated amortization of the ARM. Any such acceleration in
amortization of the principal balance of any Negatively Amortizing ARM will
shorten the weighted average life of the Mortgage Loan. The application of
partial prepayments to reduce the outstanding principal balance of a Negatively
Amortizing ARM will tend to reduce the weighted average life of the Mortgage
Loan and will adversely affect the yield to holders who purchased their
Securities at a premium, if any, and holders of classes of Interest Weighted
Securities. The pooling of Negatively Amortizing ARMs having Rate Adjustment
Dates in different months, together with different initial interest rates borne
by the Loans ("Mortgage Rates"), Lifetime Mortgage Rate Caps, Minimum Mortgage
Rates and stated maturity dates, could result in some Negatively Amortizing ARMs
that comprise or underlie the Primary Assets experiencing negative amortization
while the amortization of other Negatively Amortizing ARMs may be accelerated.

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


                                       12


     A GEM Loan provides for scheduled annual increases in the borrower's
Scheduled Payment. Because the additional portion of the Scheduled Payment is
applied to reduce the unpaid principal balance of the GEM Loan, the stated
maturity of a GEM Loan will be significantly shorter than the 25 to 30 year term
used as the basis for calculating the installments of principal and interest
applicable until the first adjustment date. The prepayment experience with
respect to Manufactured Home Loans will generally not correspond to the
prepayment experience on other types of housing loans. Even though some
Manufactured Home Loans may be FHA Loans, no statistics similar to those
describing the FHA experience above are available with respect to Manufactured
Home Loans.

     In the case of Mortgage Loans that do not require the borrowers to make
payments of principal or interest until the occurrence of certain maturity
events, the Mortgage Loans will generate enough cash to pay interest and
principal on the Securities of the related series only if specified maturity
events occur with sufficient frequency and relative regularity. There can be no
assurance regarding the rate and timing of the occurrence of maturity events
with respect to these Mortgage Loans.

     Foreclosures and Payment Plans

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

     Due on Sale Clauses

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

     Optional Termination

     If specified in the prospectus supplement, any designated entity may cause
an early termination of the trust fund by repurchasing the remaining Primary
Assets in the Trust Fund, or may purchase Securities of certain classes. See
"Description of the Securities -- Optional Termination."

                                THE TRUST FUNDS

GENERAL

     The Notes will be secured by a pledge of the assets of the trust fund, or
an individual Asset Group, and the Certificates will represent beneficial
ownership interests in the assets of the trust fund, or an individual Asset
Group, each as specified in the prospectus supplement. The Securities will be


                                       13


non-recourse obligations of the trust fund. Holders of the Notes may only
proceed against the assets of the trust fund as collateral in the case of a
default, and then only to the extent provided in the indenture, and may not
proceed against any assets of the depositor or its affiliates, or assets of the
trust fund not pledged to secure the Notes.

     The trust fund for each series of Securities will be held by the trustee
for the benefit of the related securityholders, and will consist of:

     o  amounts due and payable with respect to the Primary Assets as of the
        cut-off date designated in the prospectus supplement (the "Cut-off
        Date");

     o  amounts held from time to time in the Collection Account and the
        Distribution Account established for a series of Securities;

     o  Mortgaged Properties that secured a Mortgage Loan and that are acquired
        on behalf of the securityholders by foreclosure, deed in lieu of
        foreclosure or repossession;

     o  any Reserve Fund established pursuant to the Agreement for a series of
        Securities, if specified in the prospectus supplement;

     o  any Servicing Agreements relating to Mortgage Loans in the trust fund,
        to the extent that these agreements are assigned to the trustee;

     o  any primary mortgage insurance policies, FHA insurance, or VA guarantee
        relating to Mortgage Loans in the trust fund;

     o  any pool insurance policy, special hazard insurance policy, bankruptcy
        bond or other credit support relating to the series;

     o  investments held in any fund or account or any guaranteed investment
        contract and income from the reinvestment of these funds, if specified
        in the prospectus supplement; and

     o  any other asset, instrument or agreement relating to the trust fund and
        specified in the prospectus supplement (which may include an interest
        rate swap agreement or an interest rate cap agreement or similar
        agreement).

     The prospectus supplement may specify that a certain amount or percentage
of a Primary Asset will not be sold by the depositor or seller of the Primary
Asset, but will be retained by that party (the "Retained Interest"). Therefore,
amounts received with respect to a Retained Interest in an Agency Certificate,
a Private Mortgage-Backed Security or a Loan comprising the Primary Assets for
a series will not be included in the trust fund but will be payable to the
seller of the respective asset, or to the master servicer (if any), servicer,
depositor or another party, free and clear of the interest of securityholders
under the Agreements.

     The "Primary Assets" in the trust fund for a series of Securities may
consist of any combination of the following, to the extent and as specified in
the prospectus supplement:

     o  Ginnie Mae certificates (which may be Ginnie Mae I certificates or
        Ginnie Mae II certificates);

     o  Fannie Mae certificates;

     o  Freddie Mac certificates;

     o  mortgage pass-through certificates representing a fractional, undivided
        interest in Loans or collateralized mortgage obligations secured by
        Loans ("Private Mortgage-Backed Securities");

     o  Mortgage Loans or participation interests in Mortgage Loans; and

     o  Manufactured Home Loans or participation interests in Manufactured Home
        Loans.

     To the extent provided in the related prospectus supplement, a trust fund
that primarily consists of Mortgage Loans may also include loans ("Assistance
Loans") made by the United States Small


                                       14


Business Administration or other government agency to borrowers who have
incurred property damage or loss in connection with a federally recognized
disaster. As specified in the related prospectus supplement, Assistance Loans
may be secured by senior or junior liens on collateral of the types described in
the prospectus supplement, or unsecured. Assistance Loans may have fixed or
adjustable interest rates, may require repayment monthly or at other intervals,
and have other payment characteristics as described in the related prospectus
supplement. Additional information regarding Assistance Loans, to the extent
material to prospective investors, will be provided in the related prospectus
supplement. Such information will include, among other things, the weighted
average principal balances, interest rates and terms to maturity of the
Assistance Loans, collateral types and lien priority (if applicable), and
geographic concentration.

     Mortgage Loans, Manufactured Home Loans and Assistance Loans are referred
to in this prospectus as "Loans." Ginnie Mae certificates, Fannie Mae
certificates and Freddie Mac certificates are referred to in this prospectus as
"Agency Certificates."

     Private Mortgage-Backed Securities will evidence a beneficial ownership
interest in underlying assets that will consist of Agency Certificates or Loans.
Participation interests in a Loan or a loan pool will be purchased by the
depositor, or an affiliate, pursuant to a participation agreement (a
"Participation Agreement"). The interest acquired by the depositor under the
Participation Agreement will be evidenced by a participation certificate. The
trustee will be the holder of a participation certificate. Loans that comprise
the Primary Assets will be purchased by the depositor directly or through an
affiliate in the open market or in privately negotiated transactions. Some, none
or all of the Loans may have been originated by an affiliate of the depositor.
See "The Agreements -- Assignment of Primary Assets."

GINNIE MAE CERTIFICATES

     General

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

     The Ginnie Mae certificates do not constitute a liability of, or evidence
any recourse against, the Ginnie Mae Servicer, the depositor or any affiliate of
the depositor, and the only recourse of a registered holder, such as the trustee
or its nominee, is to enforce the guarantee of Ginnie Mae.

     Ginnie Mae approves the issuance of each Ginnie Mae certificate in
accordance with a guaranty agreement (the "Guaranty Agreement") between Ginnie
Mae and the Ginnie Mae Servicer of the Ginnie Mae certificate. Pursuant to the
Guaranty Agreement, the Ginnie Mae Servicer is required to advance its own funds
in order to make timely payments of all amounts due on the Ginnie Mae
certificate, whether or not the payments received by the Ginnie Mae Servicer on
the underlying mortgage loans equal the amounts due on the Ginnie Mae
certificate. If a Ginnie Mae Servicer is unable to make a payment as it becomes
due, it must promptly notify Ginnie Mae and request Ginnie Mae to make the
payment. Upon notification and request, Ginnie Mae will make payments directly
to the registered holder of the Ginnie Mae certificate. In the event no payment
is made by a Ginnie Mae Servicer and the Ginnie Mae Servicer fails to notify and
request Ginnie Mae to make a payment, the


                                       15


holder of the Ginnie Mae certificate has recourse only against Ginnie Mae to
obtain the payment. The trustee or its nominee, as registered holder of the
Ginnie Mae certificates, may proceed directly against Ginnie Mae under the terms
of any Ginnie Mae certificate or the Guaranty Agreement relating to the Ginnie
Mae certificate for any amounts that are not paid under the Ginnie Mae
certificate.

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

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

     The Underlying Mortgage Loans

     Unless otherwise specified in the prospectus supplement, mortgage loans
underlying the Ginnie Mae certificates included in the trust fund for a series
will consist of FHA Loans and/or housing loans partially guaranteed by the VA
("VA Loans"), all of which are assumable by a purchaser. Ginnie Mae certificates
securing a series may be backed by level payment mortgage loans, Ginnie Mae
Loans, GEM Loans or Buy-Down Loans or adjustable rate mortgage loans or other
mortgage loans eligible for inclusion in a Ginnie Mae certificate. The mortgage
loans may be secured by Manufactured Homes, Single Family Property or
Multifamily Property.

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

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

     The Ginnie Mae certificates included in the trust fund for a series may
have other characteristics and terms different from those described above, so
long as the Ginnie Mae certificates and underlying mortgage loans meet the
criteria of each Rating Agency rating the Securities of that series. The Ginnie
Mae certificates and underlying mortgage loans will be described in the
prospectus supplement.

     Ginnie Mae

     The Government National Mortgage Association ("Ginnie Mae") is a wholly
owned corporate instrumentality of the United States of America. Section 306(g)
of Title III of the National Housing


                                       16


Act of 1934, as amended (the "Housing Act") authorizes Ginnie Mae to guarantee
the timely payment of the principal of and the interest on Ginnie Mae
certificates, which are based on and backed by a pool of mortgages insured by
the Federal Housing Administration, a division of HUD ("FHA") under the Housing
Act or Title V of the Housing Act of 1949, or partially guaranteed by the
Veterans Administration ("VA") under the Servicemen's Readjustment Act of 1944,
as amended, or Chapter 37 of Title 38, United States Code, or by other eligible
mortgage loans.

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

FANNIE MAE CERTIFICATES

     General

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

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

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

     The Underlying Mortgage Loans

     Unless otherwise specified in the prospectus supplement for a series of
Securities, mortgage loans underlying Fannie Mae certificates in the trust fund
for a series will consist of:

     o  fixed-rate level payment mortgage loans that are not insured or
        guaranteed by any governmental agency ("Conventional Loans");

     o  fixed-rate level payment FHA Loans or VA Loans;

     o  adjustable rate mortgage loans;


                                       17


     o  GEM Loans, Buy-Down Loans or GPM Loans; and

     o  mortgage loans secured by one-to-four family attached or detached
        residential housing, including Cooperative Dwellings ("Single Family
        Property") or by Multifamily Property.

     Each mortgage loan must meet the applicable standards set forth under the
Fannie Mae purchase program. The original maturities of substantially all of the
fixed rate level payment Conventional Mortgage Loans are expected to be between
either eight to 15 years or 20 to 40 years. The original maturities of
substantially all of the fixed rate level payment FHA Loans or VA Loans are
expected to be 30 years.

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

     The rate of interest payable on a Fannie Mae certificate (and the series
pass-through rate payable with respect to a Fannie Mae Stripped Mortgage Backed
Security) is equal to the lowest interest rate of any mortgage loan in the
related pool, less a specified minimum annual percentage representing servicing
compensation and Fannie Mae's guarantee fee.

     The trust fund for a series of Securities may include Fannie Mae
certificates having characteristics and terms different from those described
above, so long as the Fannie Mae certificates and underlying mortgage loans meet
the criteria of each Rating Agency rating the series. The Fannie Mae
certificates and underlying mortgage loans will be described in the prospectus
supplement.

     Fannie Mae

     Fannie Mae ("Fannie Mae") is a federally chartered and stockholder-owned
corporation organized and existing under the Federal National Mortgage
Association Charter Act, as amended (12 U.S.C. Section 1716 et seq.). Fannie Mae
was originally established in 1938 as a United States government agency to
provide supplemental liquidity to the mortgage market and was transformed into a
stockholder-owned and privately managed corporation by legislation enacted in
1968.

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

FREDDIE MAC CERTIFICATES

     General

     The Freddie Mac certificates represent an undivided interest in a group of
mortgages or participations in mortgages (a "PC Pool") purchased by Freddie Mac.
Freddie Mac certificates are sold under the terms of a Mortgage Participation
Certificate Agreement and may be issued under


                                       18


either Freddie Mac's "Cash Program" or "Guarantor Program" or may be Multiclass
Mortgage Participation Certificates (Guaranteed) representing multiple classes
of certificates of beneficial interest in a pool consisting primarily of Freddie
Mac certificates.

     The Freddie Mac certificates will be guaranteed by Freddie Mac as to the
timely payment of interest at the applicable Freddie Mac certificate rate on the
holder's pro rata share of the unpaid principal balance outstanding on the
underlying mortgage loans, whether or not received. Freddie Mac also guarantees
payment of principal on the underlying mortgage loans, without any offset or
deduction, to the extent of the registered holder's pro rata share thereof, but
does not, except with respect to "Scheduled Principal" Freddie Mac certificates
issued under the Guarantor Program, guarantee the timely payment of scheduled
principal. Under Freddie Mac's Gold PC Program, Freddie Mac guarantees the
timely payment of principal based on the difference between the pool factor
published in the month preceding the month of distribution and the pool factor
published in the month of distribution.

     Pursuant to its guarantee, Freddie Mac indemnifies holders of Freddie Mac
certificates against any diminution in principal by reason of charges for
property repairs, maintenance and foreclosure. Freddie Mac may remit the amount
due on account of its guarantee of collection of principal at any time after
default on an underlying mortgage loan, but not later than:

     o  30 days following foreclosure sale;

     o  30 days following payment of the claim by any mortgage insurer; or

     o  30 days following the expiration of any right of redemption.

     In any event, Freddie Mac must remit the guarantee amount no later than one
year after demand has been made upon the mortgagor for accelerated payment of
principal. In taking actions regarding the collection of principal after default
on the mortgage loans underlying Freddie Mac certificates, including the timing
of demand for acceleration, Freddie Mac reserves the right to exercise its
judgment with respect to the mortgage loans in the same manner as for mortgages
that Freddie Mac has purchased but not sold. The length of time necessary for
Freddie Mac to determine that a mortgage loan should be accelerated varies with
the particular circumstances of each mortgagor, and Freddie Mac has not adopted
servicing standards that require that the demand be made within any specified
period.

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

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


                                       19


lowest interest rate on the underlying mortgage loans, minus a minimum servicing
fee and the amount of Freddie Mac's management and guarantee income as agreed
upon between the seller and Freddie Mac.

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

     Requests for registration of ownership of Freddie Mac certificates made on
or before the last business day of a month are made effective as of the first
day of that month. With respect to Freddie Mac certificates sold by Freddie Mac
on or after January 2, 1985, the Federal Reserve Bank of New York maintains
book-entry accounts with respect thereto and makes payments of interest and
principal each month to holders in accordance with the holders' instructions.
The first payment to a holder of a Freddie Mac certificate will normally be
received by the holder by the 15th day of the second month following the month
in which the holder became a holder of the Freddie Mac certificate. Thereafter,
payments will normally be received by the 15th day of each month.

     The Underlying Mortgage Loans

     Unless otherwise specified in the prospectus supplement, each PC Pool
underlying the Freddie Mac certificates in the trust fund for a series will
consist of first lien, fixed-rate, fully amortizing, conventional residential
mortgages or participation interests therein. Unless otherwise specified in the
prospectus supplement, all of the mortgage loans evidenced by a Freddie Mac
certificate are conventional mortgages and therefore do not have the benefit of
any guarantee or insurance by, and are not obligations of, the United States of
America. All mortgages purchased by Freddie Mac must meet certain standards set
forth in the Freddie Mac Act (as defined below).

     The trust fund for a series may include Freddie Mac certificates having
other characteristics and terms different from those described above, so long as
the Freddie Mac certificates and the underlying mortgage loans meet the criteria
of each Rating Agency rating the Securities of the series. The Freddie Mac
certificates and underlying mortgage loans will be described in the prospectus
supplement.

     Freddie Mac

     The Federal Home Loan Mortgage Corporation ("Freddie Mac") is a corporate
instrumentality of the United States of America created pursuant to an Act of
Congress (Title III of the Emergency Home Finance Act of 1970, as amended, 12
U.S.C. Section Section 1451-1459) on July 24, 1970 (the "Freddie Mac Act").
Freddie Mac was established primarily for the purpose of increasing the
availability of mortgage credit for the financing of needed housing. It provides
an enhanced degree of liquidity for residential mortgage investments primarily
by assisting in the development of secondary markets for conventional mortgages.
The principal activity of Freddie Mac consists of the purchase of first lien,
conventional, residential mortgage loans and participation interests in mortgage
loans from mortgage lending institutions and the resale of the whole loans and
participations so purchased in the form of guaranteed mortgage securities,
primarily Freddie Mac certificates. All mortgage loans purchased by Freddie Mac
must meet certain standards set forth in the Freddie Mac Act. Freddie Mac is
confined to purchasing, so far as practicable, mortgage loans that it deems to
be of such quality, type and class as to meet generally the purchase standards
imposed by private institutional mortgage investors. See "Additional
Information" for the availability of further information with respect to Freddie
Mac and Freddie Mac certificates.


                                       20


PRIVATE MORTGAGE-BACKED SECURITIES

     General

     The trust fund for a series may consist of Private Mortgage-Backed
Securities, which include:

     o  mortgage pass-through certificates, evidencing an undivided interest in
        a pool of Loans or Agency Certificates; or

     o  collateralized mortgage obligations secured by Loans or Agency
        Certificates.

     Private Mortgage-Backed Securities are issued pursuant to a pooling and
servicing agreement, a trust agreement, an indenture or similar agreement (a
"PMBS Agreement"). The seller/servicer of the underlying Loans, or the issuer of
the collateralized mortgage obligations, as the case may be, enters into the
PMBS Agreement with the trustee under the PMBS Agreement (the "PMBS Trustee").
The PMBS Trustee or its agent, or a custodian, possesses the Loans underlying
the Private Mortgage-Backed Security. Loans underlying a Private Mortgage-Backed
Security are serviced by a servicer (the "PMBS Servicer") directly or by one or
more sub-servicers who may be subject to the supervision of the PMBS Servicer.
The PMBS Servicer will generally be a Fannie Mae or Freddie Mac approved
servicer and, if FHA Loans underlie the Private Mortgage-Backed Securities, will
be approved by the United States Department of Housing and Urban Development
("HUD") as an FHA mortgagee.

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

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

     Underlying Loans

     The Loans underlying the Private Mortgage-Backed Securities may consist of
fixed rate, level payment, fully amortizing Loans or GEM Loans, GPM Loans,
Buy-Down Loans, Bi-Weekly Loans, ARMs, or Loans having balloon or other
irregular payment features. Loans may be secured by Single Family Property,
Multifamily Property, Manufactured Homes, or, in the case of Cooperative Loans,
by an assignment of the proprietary lease or occupancy agreement relating to a
Cooperative Dwelling and the shares issued by the related cooperative. Except as
otherwise specified in the prospectus supplement:

     o  no Loan will have had a Loan-to-Value Ratio at origination in excess of
        95%;

     o  each Mortgage Loan secured by a Single Family Property and having a
        Loan- to-Value Ratio in excess of 80% at origination will be covered by
        a primary mortgage insurance policy;

     o  each Loan will have had an original term to stated maturity of not less
        than 10 years and not more than 40 years;


                                       21


     o  no Loan that was more than 89 days delinquent as to the payment of
        principal or interest will have been eligible for inclusion in the
        assets under the related PMBS Agreement;

     o  each Loan (other than a Cooperative Loan) will be required to be covered
        by a standard hazard insurance policy (which may be a blanket policy);
        and

     o  each Loan (other than a Cooperative Loan or a Loan secured by a
        Manufactured Home) will be covered by a title insurance policy.

     Credit Support Relating to Private Mortgage-Backed Securities

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

     Additional Information

     The prospectus supplement for a series of Securities for which the trust
fund includes Private Mortgage-Backed Securities will specify, to the extent
material:

     o  the aggregate approximate principal amount and type of the Agency
        Certificates and Private Mortgage-Backed Securities to be included in
        the trust fund;

     o  certain characteristics of the Agency Certificates or Loans that
        comprise the underlying assets for the Private Mortgage-Backed
        Securities including, (1) the payment features of Loans (i.e., whether
        they are fixed rate or adjustable rate and whether they provide for
        fixed level payments or other payment features), (2) the approximate
        aggregate principal balance, if known, of underlying Loans insured or
        guaranteed by a governmental entity, (3) the servicing fee or range of
        servicing fees with respect to the Loans, and (4) the minimum and
        maximum stated maturities of the underlying Loans at origination;

     o  the interest rate or range of interest rates of the Private
        Mortgage-Backed Securities;

     o  the weighted average interest rate of the Private Mortgage-Backed
        Securities;

     o  the PMBS Issuer, the PMBS Servicer and the PMBS Trustee for the Private
        Mortgage-Backed Securities;

     o  certain characteristics of credit support, if any, such as Reserve
        Funds, Insurance Policies, letters of credit or guarantees relating to
        the Loans underlying the Private Mortgage-Backed Securities or to the
        Private Mortgage-Backed Securities themselves;

     o  the terms on which the underlying Loans for the Private Mortgage-Backed
        Securities may, or are required to, be purchased prior to their stated
        maturity or the stated maturity of the Private Mortgage-Backed
        Securities; and

     o  the terms on which Loans may be substituted for those originally
        underlying the Private Mortgage-Backed Securities.

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


                                       22


THE MORTGAGE LOANS

     General

     The Primary Assets in a trust fund for a series of Securities may include
mortgage loans or participation interests in mortgage loans (together, "Mortgage
Loans"). Generally, the originators of the Mortgage Loans are savings and loan
associations, savings banks, commercial banks, credit unions, insurance
companies, or similar institutions supervised and examined by a Federal or State
authority or by mortgagees approved by the Secretary of Housing and Urban
Development pursuant to sections 203 and 211 of the National Housing Act. An
affiliate of the depositor may have originated some of the Mortgage Loans.

     The Mortgage Loans in a trust fund may be Conventional Loans, housing loans
insured by the FHA ("FHA Loans") or VA Loans, with the following interest rate
and payment characteristics:

     o  fixed interest rate or adjustable interest rate Mortgage Loans;

     o  "GPM Loans," which provide for fixed level payments or graduated
        payments, with an amortization schedule (1) requiring the mortgagor's
        monthly installments of principal and interest to increase at a
        predetermined rate annually for a predetermined period after which the
        monthly installments become fixed for the remainder of the mortgage
        term, (2) providing for deferred payment of a portion of the interest
        due monthly during that period of time; or (3) providing for recoupment
        of the interest deferred through negative amortization, whereby the
        difference between the scheduled payment of interest on the mortgage
        note and the amount of interest actually accrued is added monthly to the
        outstanding principal balance of the mortgage note;

     o  "GEM Loans," which are fixed rate, fully amortizing mortgage loans
        providing for monthly payments based on a 10- to 30-year amortization
        schedule, with further provisions for scheduled annual payment increases
        for a number of years with the full amount of those increases being
        applied to principal, and with further provision for level payments
        thereafter;

     o  Buy-Down Loans;

     o  "Bi-Weekly Loans," which are fixed-rate, conventional, fully-amortizing
        Mortgage Loans secured by first mortgages on one- to four-family
        residential properties that provide for payments of principal and
        interest by the borrower once every two weeks; or

     o  Mortgage Loans with other payment characteristics as described in this
        prospectus and the prospectus supplement.

     The Mortgage Loans may include:

     o  "Cooperative Loans," which are evidenced by promissory notes secured by
        a lien on the shares issued by private, non-profit, cooperative housing
        corporations ("Cooperatives") and on the related proprietary leases or
        occupancy agreements granting exclusive rights to occupy individual
        housing units in a building owned by a Cooperative ("Cooperative
        Dwellings"); or

     o  "Condominium Loans," which are secured by a mortgage on an individual
        housing unit (a "Condominium Unit") in which the owner of the real
        property (the "Condominium") is entitled to the exclusive ownership and
        possession of his or her individual Condominium Unit and also owns a
        proportionate undivided interest in all parts of the Condominium
        Building (other than the individual Condominium Units) and all areas or
        facilities, if any, for the common use of the Condominium Units,
        together with the Condominium Unit's appurtenant interest in the common
        elements.

     Generally, the Mortgage Loans are secured by mortgages or deeds of trust or
other similar security instruments creating a first lien or (if so specified in
the prospectus supplement) a junior lien on Mortgaged Property. If specified in
the prospectus supplement, the Mortgage Loans may be secured by security
instruments creating a lien on borrowers' leasehold interests in real property,
if the depositor determines the Mortgage Loans are commonly acceptable to
institutional mortgage


                                       23


investors. A Mortgage Loan secured by a leasehold interest in real property is
secured not by a fee simple interest in the Mortgaged Property but rather by a
leasehold interest under which the mortgagor has the right, for a specified
term, to use the related real estate and the residential dwelling or dwellings
located on the real estate. Generally, a Mortgage Loan will be secured by a
leasehold interest only if the use of leasehold estates as security for mortgage
loans is customary in the area, the lease is not subject to any prior lien that
could result in termination of the lease, and the term of the lease ends at
least five years beyond the maturity date of the Mortgage Loan.

     The Mortgaged Properties may include Single Family Properties (i.e., one-
to four-family residential housing, including Condominium Units and Cooperative
Dwellings) or Multifamily Properties (i.e., multifamily residential rental
properties or cooperatively-owned properties consisting of five or more dwelling
units). The Mortgaged Properties may consist of detached individual dwellings,
townhouses, duplexes, triplexes, quadriplexes, row houses, individual units in
planned unit developments and other attached dwelling units. Multifamily
Property or Single Family Property may include mixed commercial and residential
structures.

     Each Single Family Property and Multifamily Property will be located on
land owned in fee simple by the borrower or on land leased by the borrower for a
term at least five years greater than the term of the related Mortgage Loan
unless otherwise specified in the prospectus supplement. Attached dwellings may
include owner-occupied structures where each borrower owns the land upon which
the unit is built, with the remaining adjacent land owned in common or dwelling
units subject to a proprietary lease or occupancy agreement in a cooperatively
owned apartment building. The proprietary lease or occupancy agreement securing
a Cooperative Loan is generally subordinate to any blanket mortgage on the
related cooperative apartment building and/or on the underlying land.
Additionally, in the case of a Cooperative Loan, the proprietary lease or
occupancy agreement is subject to termination and the cooperative shares are
subject to cancellation by the cooperative if the tenant-stockholder fails to
pay maintenance or other obligations or charges owed to the Cooperative by the
tenant-stockholder. See "Legal Aspects of Loans."

     The prospectus supplement will disclose the aggregate principal balance of
Mortgage Loans secured by Mortgaged Properties that are owner-occupied. Unless
otherwise specified in the prospectus supplement, the sole basis for a
representation that a given percentage of the Mortgage Loans are secured by
Single-Family Property that is owner-occupied will be either (1) a
representation by the mortgagor at origination of the Mortgage Loan that either
the borrower will use the underlying Mortgaged Property for a period of at least
six months every year or that the borrower intends to use the Mortgaged Property
as a primary residence, or (2) a finding that the address of the Mortgaged
Property is the borrower's mailing address, as reflected in the servicer's
records. To the extent specified in the prospectus supplement, the Mortgaged
Properties may include non-owner occupied investment properties and vacation and
second homes. Mortgage Loans secured by investment properties and Multifamily
Property may also be secured by an assignment of leases and rents and operating
or other cash flow guarantees relating to the Loans.

     The characteristics of the Mortgage Loans comprising or underlying the
Primary Assets for a series may vary if credit support is provided in levels
satisfactory to the Rating Agencies that rate a series of Securities. Generally,
unless otherwise specified in the prospectus supplement, the following selection
criteria apply to Mortgage Loans included in the Primary Assets:

     o  no first lien Mortgage Loan may have a Loan-to-Value Ratio at
        origination in excess of 95%, and no second lien Mortgage Loan may have
        a Loan-to-Value Ratio at origination in excess of 125%;

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

     o  each first lien Mortgage Loan must have an original term to maturity of
        not less than 10 years and not more than 40 years, and each second lien
        Mortgage Loan must have an original term to maturity of not less than
        five years and not more than 30 years;


                                       24


     o  no Mortgage Loan may be included that, as of the Cut-off Date, is more
        than 59 days delinquent as to payment of principal or interest; and

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

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

     Unless otherwise specified in the prospectus supplement, "Buy-Down Loans,"
which are level payment Mortgage Loans for which funds have been provided by a
person other than the mortgagor to reduce the mortgagor's Scheduled Payment
during the early years of the Mortgage Loan, are also generally subject to the
following requirements:

     o  during the period (the "Buy-Down Period") when the borrower is not
        obligated, on account of the buy-down plan, to pay the full Scheduled
        Payment otherwise due on the loan, the Buy-Down Loans must provide for
        Scheduled Payments based on a hypothetical reduced interest rate (the
        "Buy-Down Mortgage Rate") that is not more than 3% below the mortgage
        rate at origination and for annual increases in the Buy-Down Mortgage
        Rate during the Buy-Down Period that will not exceed 1%;

     o  the Buy-Down Period may not exceed three years;

     o  the maximum amount of funds that may be contributed for a Mortgaged
        Property having a Loan-to-Value Ratio (1) of 90% or less at origination
        is limited to 10% of the Appraised Value of the Mortgaged Property, and
        (2) of over 90% at origination is limited to 6% of the Appraised Value
        of the Mortgaged Property;

     o  the maximum amount of funds (the "Buy-Down Amounts") that may be
        contributed by the servicer of the related Mortgaged Loan is limited to
        6% of the Appraised Value of the Mortgaged Property. (This limitation
        does not apply to contributions from immediate relatives or the employer
        of the mortgagor); and

     o  the borrower under each Buy-Down Loan must be qualified at a mortgage
        rate that is not more than 3% per annum below the current mortgage rate
        at origination. (Accordingly, the repayment of a Buy-Down Loan depends
        on the borrower's ability to make larger Scheduled Payments after the
        Buy-Down Amounts are depleted).

     Multifamily Properties are generally subject to the following requirements,
unless otherwise specified in the prospectus supplement:

     o  no Mortgage Loan may be delinquent for more than 59 days within the
        12-month period ending with the Cut-off Date;

     o  no more than two payments may be 59 days or more delinquent during a
        three-year period ending on the Cut-off Date;

     o  Mortgage Loans with respect to any single borrower may not exceed 5% of
        the aggregate principal balance of the Loans comprising the Primary
        Assets as of the Cut-off Date; and

     o  the debt service coverage ratio for each Mortgage Loan (calculated as
        described in the prospectus supplement) will not be less than 1.1:1.

     As specified in the prospectus supplement, "ARMs" or "Adjustable Rate
Mortgages," which provide for periodic adjustments in the interest rate
component of the Scheduled Payment in accordance with an Index, will provide for
a fixed initial Mortgage Rate for one or more Scheduled


                                       25


Payments. Thereafter, the Mortgage Rates will adjust periodically based, subject
to the applicable limitations, on changes in the relevant Index described in the
prospectus supplement, to a rate equal to the Index plus the Gross Margin, which
is a fixed percentage spread over the Index established contractually for each
ARM at the time of its origination. An ARM may be convertible into a fixed-rate
Mortgage Loan. To the extent specified in the prospectus supplement, any ARM
that is converted may be subject to repurchase by the servicer.

     Adjustable mortgage rates can cause payment increases that some borrowers
may find difficult to make. However, each of the ARMs may provide that its
mortgage rate may not be adjusted to a rate above the applicable lifetime
mortgage rate cap (the "Lifetime Mortgage Rate Cap"), if any, or below the
applicable lifetime minimum mortgage rate (the "Minimum Mortgage Rate"), if any,
for the ARM. In addition, certain of the ARMs provide for limitations on the
maximum amount by which their mortgage rates may adjust for any single
adjustment period (the "Maximum Mortgage Rate Adjustment"). Some ARMs are
payable in self-amortizing payments of principal and interest. Other ARMs
("Negatively Amortizing ARMs") instead provide for limitations on changes in the
Scheduled Payment to protect borrowers from payment increases due to rising
interest rates.

     These limitations can result in Scheduled Payments that are greater or less
than the amount necessary to amortize a Negatively Amortizing ARM by its
original maturity at the mortgage rate in effect during any particular
adjustment period. In the event that the Scheduled Payment is not sufficient to
pay the interest accruing on a Negatively-Amortizing ARM, then the Deferred
Interest is added to the principal balance of the ARM, resulting in negative
amortization, and will be repaid through future Scheduled Payments. If specified
in the prospectus supplement, Negatively-Amortizing ARMs may provide for the
extension of their original stated maturity to accommodate changes in their
mortgage rate. The prospectus supplement will specify whether the ARMs
comprising or underlying the Primary Assets are Negatively Amortizing ARMs.

     The index (the "Index") applicable to any ARM comprising the Primary Assets
will be the one-month LIBOR Index, the three-year Treasury Index, the one-year
Treasury Index, the Six Month Treasury Index, the Eleventh District Costs of
Funds Index or the National Monthly Median Cost of Funds Ratio to institutions
insured by the Federal Savings and Loan Insurance Corporation ("FSLIC"), or any
other index or indices as described in the prospectus supplement.

     Certain of the Mortgage Loans may be fixed or variable rate Mortgage Loans
that do not provide for monthly payments of principal and interest by the
borrower. Instead, these Mortgage Loans will provide generally either for the
accrual of interest on a monthly basis and the repayment of principal, interest
and, in some cases, certain amounts calculated by reference to the value, or the
appreciation in value of the related Mortgaged Property, or for payment in lieu
of interest of an amount calculated by reference to the appreciation in value of
the related Mortgaged Property, in each case upon the occurrence of specified
maturity events. Maturity events generally include:

     o  the death of the borrower, or the last living of two co-borrowers;

     o  the borrower, or the last living of two co-borrowers, ceasing to use the
        related Mortgaged Property as his or her principal residence; or

     o  the sale of the related Mortgaged Property.

     The maturity of this type of Mortgage Loan may be accelerated upon the
occurrence of certain events, such as deterioration in the condition of the
Mortgaged Property.

     The prospectus supplement for each series of Securities will provide
information about the Mortgage Loans, as of the Cut-off Date, including:

          (1) the aggregate outstanding principal balance of the Mortgage Loans;

          (2) the weighted average Mortgage Rate of the Mortgage Loans, and, in
     the case of ARMs, the weighted average of the current mortgage rates and
     the Lifetime Mortgage Rate Caps, if any;

          (3) the average outstanding principal balance of the Mortgage Loans;

          (4) the weighted average term-to-stated maturity of the Mortgage Loans
     and the range of remaining terms-to-stated maturity;


                                       26


          (5) the range of Loan-to-Value Ratios for the Mortgage Loans;

          (6) the relative percentage (by outstanding principal balance as of
     the Cut-off Date) of Mortgage Loans that are ARMs, Cooperative Loans,
     Conventional Loans, FHA Loans and VA Loans;

          (7) the percentage of Mortgage Loans (by outstanding principal balance
     as of the Cut-off Date) that are not covered by primary mortgage insurance
     policies;

          (8) any pool insurance policy, special hazard insurance policy or
     bankruptcy bond or other credit support relating to the Mortgage Loans;

          (9) the geographic distribution of the Mortgaged Properties securing
     the Mortgage Loans; and

          (10) the percentage of Mortgage Loans (by principal balance as of the
     Cut-off Date) that are secured by Single Family Property, Multifamily
     Property, Cooperative Dwellings, investment property and vacation or second
     homes.

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

THE MANUFACTURED HOME LOANS

     The Loans secured by Manufactured Homes ("Manufactured Home Loans")
comprising or underlying the Primary Assets for a series of Securities will
consist of manufactured housing conditional sales contracts and installment loan
agreements originated by a manufactured housing dealer in the ordinary course of
business and purchased by the depositor. Each Manufactured Home Loan will have
been originated by a bank or savings institution that is a Fannie Mae- or
Freddie Mac-approved seller/servicer or by any financial institution approved
for insurance by the Secretary of Housing and Urban Development pursuant to
Section 2 of the National Housing Act.

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

     Each "Manufactured Home" securing the Manufactured Home Loan consists of a
manufactured home within the meaning of 42 United States Code, Section 5402(6),
which defines a "manufactured home" as "a structure, transportable in one or
more sections, which in the traveling mode, is eight body feet or more in width
or 40 body feet or more in length, or, when erected on site, is 320 or more
square feet, and which is built on a permanent chassis and designed to be used
as a dwelling with or without a permanent foundation when connected to the
required utilities, and includes the plumbing, heating, air-conditioning, and
electrical systems contained therein; except that such term shall include any
structure which meets all the requirements of [this] paragraph except the size
requirements and with respect to which the manufacturer voluntarily files a
certification required by the Secretary of Housing and Urban Development and
complies with the standards established under [this] chapter."

     Unless otherwise specified in the prospectus supplement for a series, the
following restrictions apply with respect to Manufactured Home Loans comprising
or underlying the Primary Assets for a series:

     o  no Manufactured Home Loan may have a Loan-to-Value Ratio at origination
        in excess of 95%;

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


                                       27


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

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

     The initial Loan-to-Value Ratio of any Manufactured Home Loan represents
the ratio of the principal amount of the Manufactured Home Loan outstanding at
the origination of the loan divided by the fair market value of the Manufactured
Home, as shown in the appraisal prepared in connection with origination of the
Manufactured Home Loan (the "Appraised Value"). The fair market value of the
Manufactured Home securing any Manufactured Home Loan is the lesser of the
purchase price paid by the borrower or the Appraised Value of the Manufactured
Home. With respect to underwriting of Manufactured Home Loans, see "Loan
Underwriting Procedures and Standards." With respect to servicing of
Manufactured Home Loans, see "Servicing of Loans."

     The prospectus supplement for a series of Securities will provide
information about the Manufactured Home Loans comprising the Primary Assets as
of the Cut-off Date, including:

          (1) the aggregate outstanding principal balance of the Manufactured
     Home Loans comprising or underlying the Primary Assets;

          (2) the weighted average interest rate on the Manufactured Home Loans;

          (3) the average outstanding principal balance of the Manufactured Home
     Loans;

          (4) the weighted average scheduled term to maturity of the
     Manufactured Home Loans and the range of remaining scheduled terms to
     maturity;

          (5) the range of Loan-to-Value Ratios of the Manufactured Home Loans;

          (6) the relative percentages (by principal balance as of the Cut-off
     Date) of Manufactured Home Loans that were made on new Manufactured Homes
     and on used Manufactured Homes;

          (7) any pool insurance policy, special hazard insurance policy or
     bankruptcy bond or other credit support relating to the Manufactured Home
     Loans; and

          (8) the distribution by state of Manufactured Homes securing the
     Loans.

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

     The information described above regarding the Manufactured Home Loans in a
trust fund may be presented in the prospectus supplement in combination with
similar information regarding the Mortgage Loans in the trust fund.

PRE-FUNDING ARRANGEMENTS

     The depositor may be required to deposit cash or liquid securities into a
pre-funding account on the issuance date. To the extent provided in the
prospectus supplement for a series, the related Agreements may provide for a
commitment by the depositor to subsequently convey to the trust fund additional
Primary Assets or additional advances in respect of Mortgage Loans that
comprise existing Primary Assets ("Subsequent Primary Assets") following the
date on which the Securities are issued (a "Pre-Funding Arrangement"). The
Pre-Funding Arrangement will require that any Subsequent Primary Assets
included in the trust fund conform to the requirements and conditions provided
in the related Agreements. If a Pre-Funding Arrangement is utilized, on the
closing date for the issuance of the Securities, the trustee will be required
to deposit in a segregated account (a "Pre-Funding Account") all or a portion
of the proceeds received by the trustee in connection with the sale of one or
more classes of Securities of the series. Subsequently, the trust fund will
acquire Subsequent


                                       28


Primary Assets in exchange for the release of money from the Pre-Funding
Account. Unless otherwise specified in the prospectus supplement, the
Pre-Funding Arrangement will be limited to a specified period, generally not to
exceed three months, during which time any transfers of Subsequent Primary
Assets must occur.

     If all of the funds originally deposited in the Pre-Funding Account are
not used by the end of any specified period, then any remaining amount will be
applied as a mandatory prepayment of a class or classes of Securities, as
specified in the prospectus supplement. Although we expect that substantially
all of the funds in the Pre-Funding Account will be used to acquire Subsequent
Primary Assets, so that there will be no material principal distributions from
amounts remaining on deposit in the Pre-Funding Account, we cannot assure you
that such a distribution will not occur on the Distribution Date following the
end of the Pre-Funding Arrangement.

     Amounts on deposit in the Pre-Funding Account will be invested as provided
in the related Agreements in investments permitted by the Rating Agencies.


COLLECTION ACCOUNT AND DISTRIBUTION ACCOUNT

     The trustee, or the master servicer, in the name of the trustee, will
establish a separate Collection Account for each series, for deposit of all
distributions received with respect to the Primary Assets for the series, any
initial cash deposit, and reinvestment income. If specified in the prospectus
supplement, any reinvestment income or other gain from investments of funds in
the Collection Account will be credited to the Collection Account, and any loss
resulting from the investments will be charged to the Collection Account.
Reinvestment income may, however, be payable to the trustee, the master
servicer or a servicer as additional compensation. See "Servicing of Loans" and
"The Agreements -- Investment of Funds." In this case, the reinvestment income
would not be included in calculation of the Available Distribution Amount. See
"Description of the Securities -- Distributions on the Securities."

     Funds on deposit in the Collection Account will be available for
remittance to the trustee for deposit into the Distribution Account to the
extent of the Available Distribution Amount and for certain other payments
provided for in the Agreements. Unless otherwise specified in the prospectus
supplement, amounts in the Collection Account constituting reinvestment income
payable to the master servicer as additional servicing compensation or for the
reimbursement of advances or expenses, amounts in respect of any excess
servicing fee, Retained Interest, and amounts to be deposited into any reserve
fund will not be included in determining amounts to be remitted to the trustee
for deposit into the Distribution Account.

     A separate Distribution Account will be established by the trustee in the
name of the trustee for the benefit of the securityholders into which all funds
received from the master servicer (or servicer) and all required withdrawals
from any reserve funds for the related series will be deposited, pending
distribution to the securityholders. If specified in the prospectus supplement,
any reinvestment income or other gain from investments of funds in the
Distribution Account will be credited to the Distribution Account, and any loss
resulting from the investments will be charged to the Distribution Account.
Reinvestment income, may, however, be payable to the trustee or the master
servicer as additional compensation. On each Distribution Date, all funds on
deposit in the Distribution Account, subject to certain permitted withdrawals
by the trustee as set forth in the Agreements, will be available for remittance
to the securityholders. See also "The Agreements -- Distribution Account."


OTHER FUNDS OR ACCOUNTS

     A trust fund may include other funds and accounts or a security interest
in certain funds and accounts for the purpose of, among other things, paying
certain administrative fees and expenses of the trust and accumulating funds
pending their distribution. If specified in the prospectus supplement, certain
funds may be established with the trustee with respect to Buy-Down Loans, GPM
Loans, or other Loans having special payment features included in the trust
fund in addition to or in lieu of any similar funds to be held by the servicer.
See "Servicing of Loans -- Collection Procedures; Escrow


                                       29


Accounts" and "-- Deposits to and Withdrawals from the Collection Account." If
Private Mortgage-Backed Securities are backed by GPM Loans, and the asset value
with respect to a Multi-Class Series is determined on the basis of the
scheduled maximum principal balance of the GPM Loans, a GPM Fund will be
established that will be similar to that which would be established if GPM
Loans constituted the Primary Assets. See "Servicing of Loans -- Deposits to
and Withdrawals from the Collection Account." Other similar accounts may be
established as specified in the prospectus supplement.

                  LOAN UNDERWRITING PROCEDURES AND STANDARDS

UNDERWRITING STANDARDS

     The depositor expects that Loans comprising the Primary Assets for a
series of Securities will have been originated generally in accordance with
underwriting procedures and standards similar to those described in this
prospectus, except as otherwise described in the prospectus supplement.

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

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

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


                                       30


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

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

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

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

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

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

LOSS EXPERIENCE

     The general appreciation of real estate values experienced in the past has
been a factor in limiting the general loss experience on Conventional Loans.
However, we cannot assure you that the past pattern of appreciation in value of
the real property securing the Loans will continue; in fact, some regions of
the country have experienced significant depreciation in real estate values in
recent periods. Also, there is no assurance that appreciation of real estate
values generally, if appreciation occurs, will limit loss experiences on
non-traditional housing such as Multifamily Property, Manufactured Homes or
Cooperative Dwellings. Similarly, no assurance can be given that the value of
the Mortgaged Property (including Cooperative Dwellings) securing a Loan has
remained or will


                                       31


remain at the level existing on the date of origination of the Loan. If the
residential real estate market in one or more regions of the United States
should experience decline in property values so that the outstanding balances
of the Loans and any secondary financing on the Mortgaged Properties securing
the Loans become equal to or greater than the value of the related Mortgaged
Properties, then the actual rates of delinquencies, foreclosures and losses
could be higher than those now generally experienced in the mortgage lending
industry. See "Legal Aspects of Loans."

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

     To the extent that losses resulting from delinquencies, losses and
foreclosures or repossession of Mortgaged Property with respect to Loans
included in the Primary Assets for a series of Securities are not covered by
the methods of credit support or the insurance policies described in this
prospectus or the prospectus supplement, losses will be borne by holders of the
Securities of the related series. Even where credit support covers all losses
resulting from delinquency and foreclosure or repossession, the effect of
foreclosures and repossessions may be to increase prepayment experience on the
Primary Assets, thus reducing average weighted life and affecting yield to
maturity. See "Yield, Prepayment and Maturity Considerations."


REPRESENTATIONS AND WARRANTIES

     Unless otherwise specified in the prospectus supplement, at the time of
delivery of the Mortgage Loans to the trustee, the depositor or another entity
will represent and warrant to the trustee with respect to the Mortgage Loans
comprising the Primary Assets in a trust fund, that:

     o  any required title insurance (or in the case of Mortgaged Properties
        located in areas where such policies are generally not available, an
        attorney's certificate of title) and any required standard hazard and
        primary mortgage insurance was in effect as of the date of the
        representation and warranty;

     o  immediately prior to the transfer and assignment of the Mortgage Loans
        the depositor (or other entity) with respect to each Mortgage Loan had
        good title to and was sole owner of each Mortgage Loan;

     o  with respect to first lien Mortgage Loans, each Mortgage constituted a
        valid lien on the related Mortgaged Property (subject only to
        permissible title insurance exceptions) and that the related Mortgaged
        Property was free of material damage and was in good repair;

     o  each Mortgage Loan at the time it was made complied in all material
        respects with applicable state and federal laws, including usury, equal
        credit opportunity and truth-in-lending or similar disclosure laws; and

     o  each Mortgage Loan was current as to all required payments (i.e., not
        more than one or two payments delinquent).

     If the Mortgage Loans include Cooperative Loans, no representations or
warranties with respect to title insurance or hazard insurance will be given.
In addition, if the Mortgage Loans include Condominium Loans, no representation
regarding hazard insurance will be given. Generally, the Cooperative itself is
responsible for the maintenance of hazard insurance for property owned by the


                                       32


Cooperative and the persons appointed or elected by the Condominium Unit owners
to govern the affairs of the Condominium (the "Condominium Association") are
responsible for maintaining standard hazard insurance, insuring the entire
multi-unit building or buildings, or group of buildings, whether or not
attached to each other, located on property subject to Condominium ownership
(the "Condominium Building") (including each individual Condominium Unit), and
the borrowers of that Cooperative or Condominium may not maintain separate
hazard insurance on their individual Cooperative Dwellings or Condominium
Units. See "Servicing of Loans -- Maintenance of Insurance Policies and Other
Servicing Procedures."

     With respect to a Cooperative Loan, unless otherwise specified in the
prospectus supplement, the depositor will represent and warrant based, in part,
upon representations and warranties of the originator of the Cooperative Loan
that (1) with respect to first lien Cooperative Loans, the security interest
created by the cooperative security agreements is a valid first lien on the
collateral securing the Cooperative Loan (subject to the right of the related
Cooperative to cancel shares and terminate the proprietary lease for unpaid
assessments) and (2) the related Cooperative Dwelling is free of material
damage and in good repair.

     Unless otherwise specified in the prospectus supplement, with respect to
each Manufactured Home Loan, the depositor or another entity, based, in part,
upon representations and warranties of the originator of the Manufactured Home
Loan, will represent and warrant, among other things that:

     o  immediately prior to the transfer and assignment of the Manufactured
        Home Loans to the trustee, the depositor had good title to, and was the
        sole owner of, each Manufactured Home Loan;

     o  as of the date of the transfer and assignment, the Manufactured Home
        Loans are subject to no offsets, defenses or counterclaims;

     o  each Manufactured Home Loan at the time it was made complied in all
        material respects with applicable state and federal laws, including
        usury, equal credit opportunity and truth-in-lending or similar
        disclosure laws;

     o  with respect to first lien Manufactured Home Loans, as of the date of
        the transfer and assignment, each Manufactured Home Loan constitutes a
        valid lien on the related Manufactured Home and is free of material
        damage and is in good repair;

     o  as of the date of the representation and warranty, no Manufactured Home
        Loan is more than 59 days delinquent, and there are no delinquent tax or
        assessment liens against the related Manufactured Home; and

     o  with respect to each Manufactured Home Loan, any required hazard
        insurance policy was effective at the origination of each Manufactured
        Home Loan and remained in effect on the date of the transfer and
        assignment of the Manufactured Home Loan from the depositor and that all
        premiums due on the insurance have been paid in full.

     Upon the discovery of the breach of any representation or warranty made by
the depositor or another entity in respect of a Loan that materially and
adversely affects the value of the Loan, such party will be obligated to cure
the breach in all material respects, repurchase the Loan from the trustee, or,
unless specified otherwise in the prospectus supplement, deliver a Qualified
Substitute Mortgage Loan as described below under "The Agreements -- Assignment
of Primary Assets."

     The depositor does not have, and is not expected in the future to have,
any significant assets with which to meet its obligations to repurchase or
substitute Loans, and its only source of funds to make such a substitution or
repurchase would be from funds obtained from the enforcement of a corresponding
obligation, if any, on the part of the originator or seller of the Loans. The
PMBS Trustee (in the case of Private Mortgage-Backed Securities) or the
trustee, as applicable, will be required to enforce this obligation following
the practices it would employ in its good faith business judgment were it the
owner of the Loan. If specified in the prospectus supplement, the master
servicer may be obligated to enforce this obligation rather than the trustee or
PMBS Trustee.


                                       33


SUBSTITUTION OF PRIMARY ASSETS

     Substitution of Primary Assets will be permitted in the event of breaches
of representations and warranties with respect to any original Primary Asset or
in the event the documentation with respect to any Primary Asset is determined
by the trustee to be incomplete. The prospectus supplement will indicate the
period during which a substitution will be permitted and will describe any
other conditions upon which Primary Assets may be substituted for Primary
Assets initially included in the trust fund.

                              SERVICING OF LOANS
GENERAL

     Customary servicing functions with respect to Loans constituting the
Primary Assets in the trust fund will be provided, as specified in the
prospectus supplement, either by the master servicer directly or through one or
more servicers subject to supervision by the master servicer, or by a single
servicer that is a party to the applicable Agreement for a series and services
the Loans directly or through one or more subservicers (the "Subservicers"). In
general, descriptions of the rights and obligations of a master servicer will
also be applicable to a servicer, and descriptions of the rights and
obligations of servicers that service Loans under the supervision of a master
servicer will generally be applicable to Subservicers. If the master servicer
is not directly servicing the Loans, then the master servicer will generally:

     o  administer and supervise the performance by the servicers of their
        servicing responsibilities under their servicing agreements ("Servicing
        Agreements") with the master servicer;

     o  maintain any standard or special hazard insurance policy, primary
        mortgage insurance, bankruptcy bond or pool insurance policy required
        for the related Loans; and

     o  advance funds as described below under "Advances and Limitations
        Thereon."

     If the master servicer services the Loans through servicers as its agents,
the master servicer may or may not, as specified in the prospectus supplement,
be ultimately responsible for the performance of all servicing activities,
including those performed by the servicers, notwithstanding its delegation of
certain responsibilities to the servicers. If a single servicer services the
Loans through Subservicers, the servicer will be ultimately responsible for the
performance of all servicing activities.

     The master servicer will be a party to the applicable Agreement for any
series for which Loans comprise the Primary Assets and may be a party to a
Participation Agreement executed with respect to any Participation Certificates
that constitute the Primary Assets. The master servicer may be an affiliate of
the depositor. Unless otherwise specified in the prospectus supplement, the
master servicer and each servicer will be required to be a Fannie Mae- or
Freddie Mac-approved seller/servicer and, in the case of FHA Loans, approved by
HUD as an FHA mortgagee.

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

     The master servicer, at its election, may pay itself the Servicing Fee for
a series with respect to each Mortgage Loan either by:

     o  withholding the Servicing Fee from any scheduled payment of interest
        prior to the deposit of the payment in the Collection Account for the
        related series;

     o  withdrawing the Servicing Fee from the Collection Account after the
        entire Scheduled Payment has been deposited in the Collection Account;
        or


                                       34


     o  requesting that the trustee pay the Servicing Fee out of amounts in the
        Distribution Account.

COLLECTION PROCEDURES; ESCROW ACCOUNTS

     The master servicer, acting directly or through servicers, will make
reasonable efforts to collect all payments required to be made under the
Mortgage Loans and will, consistent with the Agreement for a series and any
applicable insurance policies and other credit supports, follow such collection
procedures as it follows with respect to comparable loans held in its own
portfolio. Consistent with the above, the master servicer and any servicer may,
in its discretion, (1) waive any assumption fee, late payment charge, or other
charge in connection with a Loan and (2) arrange with a mortgagor a schedule for
the liquidation of delinquencies by extending the Due Dates for Scheduled
Payments on the Loan.

     As specified in the prospectus supplement, the master servicer or the
servicers acting under its supervision, to the extent permitted by law, may
establish and maintain escrow or impound accounts ("Escrow Accounts") in which
payments by borrowers to pay taxes, assessments, mortgage and hazard insurance
premiums, and other comparable items that are required to be paid to the
mortgagee will be deposited. However, Mortgage Loans and Manufactured Home Loans
may not require those payments under the loan related documents, in which case
the master servicer would not be required to establish any Escrow Account with
respect to those Loans.

     Withdrawals from the Escrow Accounts are to be made to effect timely
payment of taxes, assessments, mortgage and hazard insurance premiums, to refund
to borrowers amounts determined to be overages, to pay interest to borrowers on
balances in the Escrow Account to the extent required by law, to repair or
otherwise protect the property securing the related Loan and to clear and
terminate the Escrow Account. The master servicer or the applicable servicers
will be responsible for the administration of the Escrow Accounts and generally
will make advances to the account when a deficiency exists.

DEPOSITS TO AND WITHDRAWALS FROM THE COLLECTION ACCOUNT

     The master servicer or the trustee will establish a separate account (the
"Collection Account") in the name of the trustee. The Collection Account will be
maintained in an account or accounts (1) at a depository institution, the
long-term unsecured debt obligations of which at the time of any deposit therein
are rated within the two highest rating categories by each Rating Agency rating
the Securities of the related series, (2) the deposits in which are insured to
the maximum extent available by the Federal Deposit Insurance Corporation or
which are secured in a manner meeting requirements established by each Rating
Agency or (3) with a depository institution otherwise acceptable to each Rating
Agency.

     The Collection Account may be maintained as an interest-bearing account, or
the funds held therein may be invested, pending remittance to the trustee, in
Eligible Investments. If specified in the prospectus supplement, the master
servicer will be entitled to receive as additional compensation any interest or
other income earned on funds in the Collection Account.

     As specified in the applicable Agreement, the master servicer will deposit
into the Collection Account for each series on the Business Day following the
closing date for the issuance of a series, any amounts representing Scheduled
Payments due after the related Cut-off Date but received by the master servicer
on or before the closing date, and thereafter, after the date of receipt
thereof, the following payments and collections received or made by it (other
than in respect of principal of and interest on the related Loans due on or
before the Cut-off Date):

     o  all payments on account of principal, including prepayments, on the
        Loans;

     o  all payments on account of interest on the Loans after deducting
        therefrom, at the discretion of the master servicer but only to the
        extent of the amount permitted to be withdrawn or withheld from the
        Collection Account in accordance with the related Agreement, the
        Servicing Fee in respect of the Loans;


                                       35


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

     o  all proceeds received by the trustee under any title, hazard or other
        insurance policy covering any Loan, other than proceeds to be applied to
        the restoration or repair of the Mortgaged Property or released to the
        mortgagor in accordance with the related Agreement (which will be
        retained by the master servicer and not deposited in the Collection
        Account);

     o  all amounts required to be deposited therein from any applicable Reserve
        Fund for the related series pursuant to the related Agreement;

     o  all Advances for the related series made by the master servicer pursuant
        to the related Agreement; and

     o  all proceeds of any Loans repurchased by the depositor pursuant to the
        related Agreement.

     Generally, the master servicer is permitted, from time to time, to make
withdrawals from the Collection Account for each series for the following
purposes:

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

     o  to reimburse itself for any Advances for the related series that the
        master servicer determines in good faith it will be unable to recover
        from amounts representing late recoveries of Scheduled Payments
        respecting which the Advance was made or from Liquidation Proceeds or
        the proceeds of insurance policies;

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

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

     o  to reimburse itself for expenses incurred by and recoverable by or
        reimbursable to it pursuant to the related Agreement;

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


                                       36


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

     o  to make payments to the trustee of the related series for deposit into
        the Distribution Account, if any, or for remittance to the
        securityholders of the related series in the amounts and in the manner
        provided for in the related Agreement; and

     o  to clear and terminate the Collection Account pursuant to the related
        Agreement.

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

SERVICING ACCOUNTS

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

BUY-DOWN LOANS, GPM LOANS AND OTHER SUBSIDIZED LOANS

     With respect to each Buy-Down Loan, if any, included in a trust fund, the
master servicer will deposit all Buy-Down Amounts in a custodial account (which
may be interest-bearing) complying with the requirements set forth above for the
Collection Account (the "Buy-Down Fund"). The amount of the deposit, together
with investment earnings thereon at the rate specified in the prospectus
supplement, will provide sufficient funds to support the payments on the
Buy-Down Loan on a level debt service basis. The master servicer will not be
obligated to add to the Buy-Down Fund should amounts therein and investment
earnings prove insufficient to maintain the scheduled level of payments on the
Buy-Down Loans, in which event distributions to the securityholders may be
affected.

     Unless otherwise provided in the prospectus supplement, a Buy-Down Fund
will not be included in or deemed to be a part of the trust fund. Unless
otherwise specified in the prospectus supplement, the terms of all Buy-Down
Loans provide for the contribution of buy-down funds in an amount equal to or
exceeding either (1) the total payments to be made from those funds pursuant to
the related buydown plan or (2) if the buy-down funds are present valued, that
amount of buy-down funds which, together with investment earnings thereon at a
specified rate, compounded monthly, will support the scheduled level of payments
due under the Buy-Down Loan. Neither the master servicer, any servicer nor the
depositor will be obligated to add to the buy-down funds any of its own funds
should investment earnings prove insufficient to maintain the scheduled level of
payments on the Buy-Down Loan, in which event distributions to securityholders
may be affected. With respect to each Buy-Down Loan, the master servicer will
deposit in the Collection Account the amount, if any, of the buy-down funds
(and, if applicable, investment earnings thereon) for each Buy-Down Loan that,
when added to the amount due from the borrower on the Buy-Down Loan, equals the
full monthly payment that would be due on the Buy-Down Loan if it were not
subject to the buy-down plan.

     If the borrower on a Buy-Down Loan prepays the Loan in its entirety during
the Buy-Down Period, the master servicer will withdraw from the Buy-Down Fund
and remit to the borrower in accordance with the related buy-down plan any
buy-down funds remaining in the Buy-Down Fund. If a prepayment by a borrower
during the Buy-Down Period together with buy-down funds will result in a
prepayment in full, the master servicer will withdraw from the Buy-Down Fund for
deposit in the Collection Account the buy-down funds and investment earnings
thereon, if any, which together with


                                       37


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

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

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

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

ADVANCES AND OTHER PAYMENTS, AND LIMITATIONS THEREON

     General

     The prospectus supplement will describe the circumstances under which the
master servicer or servicer will make Advances with respect to delinquent
payments on Loans. Unless otherwise specified in the prospectus supplement,
neither the master servicer nor any servicer will be obligated to make Advances,
and the obligation to do so may be limited in amount, may be limited to advances
received from the servicers, if any, or may not be activated until a certain
portion of a specified reserve fund is depleted. If the master servicer is
obligated to make Advances, a surety bond or other credit support may be
provided with respect to that obligation as described in the prospectus
supplement. Advances are intended to provide liquidity and not to guarantee or
insure against losses. Accordingly, any funds advanced are recoverable by the
servicer or the master servicer, as the case may be, out of amounts received on
particular Loans that represent late recoveries of principal or interest,
proceeds of insurance policies or Liquidation Proceeds respecting which any such
Advance


                                       38


was made. If an Advance is made and subsequently determined to be nonrecoverable
from late collections, proceeds of Insurance Policies, or Liquidation Proceeds
from the related Loan, the servicer or master servicer will be entitled to
reimbursement from other funds in the Collection Account or Servicing Account,
as the case may be, or from a specified Reserve Fund as applicable, to the
extent specified in the prospectus supplement.

     Payments in Connection With Prepaid Loans

     In addition, when a borrower makes a principal prepayment in full between
the due dates on which the borrower is required to make its payments on the
Loan, as specified in the prospectus supplement (each, a "Due Date"), the
borrower will generally be required to pay interest on the principal amount
prepaid only to the date of the prepayment. If and to the extent provided in the
prospectus supplement, in order that one or more classes of the securityholders
of a series will not be adversely affected by any resulting shortfall in
interest, the master servicer may be obligated to make payment from its own
funds to the extent necessary to include in its remittance to the trustee for
deposit into the Distribution Account an amount equal to a full Scheduled
Payment of interest on the related Loan (adjusted to the applicable Interest
Rate). Any principal prepayment, together with a full Scheduled Payment of
interest thereon at the applicable Interest Rate (to the extent of the
adjustment or advance), will be distributed to securityholders on the related
Distribution Date. If the amount necessary to include a full Scheduled Payment
of interest as described above exceeds the amount that the master servicer is
obligated to pay, a shortfall may occur as a result of a prepayment in full. See
"Yield, Prepayment and Maturity Considerations."

MAINTENANCE OF INSURANCE POLICIES AND OTHER SERVICING PROCEDURES

     Standard Hazard Insurance; Flood Insurance

     Except as otherwise specified in the prospectus supplement, the master
servicer will be required to maintain or to cause the borrower on each Loan to
maintain or will use its best reasonable efforts to cause each servicer of a
Loan to maintain a standard hazard insurance policy providing coverage of the
standard form of fire insurance with extended coverage for certain other hazards
as is customary in the state in which the property securing the related Loan is
located. See "Description of Mortgage and Other Insurance." Unless otherwise
specified in the prospectus supplement, coverage will be in an amount at least
equal to the greater of (1) the amount necessary to avoid the enforcement of any
co-insurance clause contained in the policy or (2) the outstanding principal
balance of the related Loan.

     The master servicer will also maintain on REO Property that secured a
defaulted Loan and that has been acquired upon foreclosure, deed in lieu of
foreclosure, or repossession, a standard hazard insurance policy in an amount
that is at least equal to the maximum insurable value of the REO Property. No
earthquake or other additional insurance will be required of any borrower or
will be maintained on REO Property acquired in respect of a defaulted Loan,
other than pursuant to applicable laws and regulations as may at any time be in
force and will require additional insurance. When, at the time of origination of
a Loan, the property securing that Loan is located in a federally designated
special flood hazard area, the master servicer will cause to be maintained or
use its best reasonable efforts to cause the servicer to maintain with respect
to property flood insurance as required under the Flood Disaster Protection Act
of 1973, to the extent available, or as described in the prospectus supplement.

     Any amounts collected by the master servicer or the servicer, as the case
may be, under any policies of insurance (other than amounts to be applied to the
restoration or repair of the Mortgaged Property, released to the borrower in
accordance with normal servicing procedures or used to reimburse the master
servicer for amounts to which it is entitled to reimbursement) will be deposited
in the Collection Account. In the event that the master servicer obtains and
maintains a blanket policy insuring against hazard losses on all of the Loans,
written by an insurer then acceptable to each Rating Agency that assigns a
rating to the related series, it will conclusively be deemed to have satisfied
its obligations to cause to be maintained a standard hazard insurance policy for
each Loan or


                                       39


related REO Property. This blanket policy may contain a deductible clause, in
which case the master servicer will, in the event that there has been a loss
that would have been covered by the policy absent a deductible clause, deposit
in the Collection Account the amount not otherwise payable under the blanket
policy because of the application of the deductible clause.

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

     Special Hazard Insurance Policy

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

     Primary Mortgage Insurance

     To the extent described in the prospectus supplement, the master servicer
will be required to use its best reasonable efforts to keep, or to cause each
servicer to keep, in full force and effect, a primary mortgage insurance policy
with respect to each Conventional Loan secured by Single Family Property for
which insurance coverage is required for as long as the related mortgagor is
obligated to maintain primary mortgage insurance under the terms of the related
Loan. The master servicer will not cancel or refuse to renew any primary
mortgage insurance policy in effect at the date of the initial issuance of the
Securities that is required to be kept in force unless a replacement primary
mortgage insurance policy for the cancelled or nonrenewed policy is maintained
with a mortgage guarantee or insurance company duly qualified as such under the
laws of the state in which the related Mortgaged Property is


                                       40


located duly authorized and licensed in the state to transact the applicable
insurance business and to write the insurance provided (each, a "Qualified
Insurer").

     Primary insurance policies will be required with respect to Manufactured
Home Loans only to the extent described in the prospectus supplement. If primary
mortgage insurance is to be maintained with respect to Manufactured Home Loans,
the master servicer will be required to maintain the insurance as described
above. For further information regarding the extent of coverage under a primary
mortgage insurance policy, see "Description of Mortgage and Other Insurance --
Mortgage Insurance on the Loans."

     FHA Insurance and VA Guarantees

     To the extent specified in the prospectus supplement, all or a portion of
the Loans may be insured by the FHA or guaranteed by the VA. The master servicer
will be required to take steps reasonably necessary to keep the insurance and
guarantees in full force and effect. See "Description of Mortgage and Other
Insurance -- Mortgage Insurance on the Loans."

     Pool Insurance Policy

     If specified in the prospectus supplement, the master servicer will be
obligated to use its best reasonable efforts to maintain a pool insurance policy
with respect to the Loans in the amount and with the coverage described in the
prospectus supplement. Unless otherwise specified in the prospectus supplement,
the pool insurance policy will provide for a fixed premium rate on the declining
aggregate outstanding principal balance of the Loans. The master servicer will
be obligated to pay the premiums for the pool insurance policy on a timely
basis.

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

     Bankruptcy Bond

     If specified in the prospectus supplement, the master servicer will be
obligated to use its best reasonable efforts to obtain and thereafter maintain a
bankruptcy bond or similar insurance or guaranty in full force and effect
throughout the term of the related Agreement, unless coverage thereunder has
been exhausted through payment of claims. If specified in the prospectus
supplement, the master servicer will be required to pay from its servicing
compensation the premiums for the bankruptcy bond on a timely basis. Coverage
under the bankruptcy bond may be cancelled or reduced by the master servicer at
any time, provided that the cancellation or reduction does not adversely affect
the then current rating of the related series of Securities. See "Description of
Mortgage and Other Insurance -- Bankruptcy Bond."

PRESENTATION OF CLAIMS; REALIZATION UPON DEFAULTED LOANS

     The master servicer, on behalf of the trustee and the securityholders, will
be required to present or cause to be presented, claims with respect to any
standard hazard insurance policy, pool insurance


                                       41


policy, special hazard insurance policy, bankruptcy bond, or primary mortgage
insurance policy, and to the FHA and the VA, if applicable in respect of any
FHA insurance or VA guarantee respecting defaulted Mortgage Loans.

     The master servicer will use its reasonable best efforts to foreclose upon,
repossess or otherwise comparably convert the ownership of the real properties
securing the related Loans that come into and continue in default and as to
which no satisfactory arrangements can be made for collection of delinquent
payments. In connection with any foreclosure or other conversion, the master
servicer will follow those practices and procedures as it deems necessary or
advisable and as are normal and usual in its servicing activities with respect
to comparable loans serviced by it. However, the master servicer will not be
required to expend its own funds in connection with any foreclosure or towards
the restoration of the property unless it determines that: (1) the restoration
or foreclosure will increase the Liquidation Proceeds in respect of the related
Mortgage Loan available to the securityholders after reimbursement to itself for
its expenses and (2) that the expenses will be recoverable by it either through
Liquidation Proceeds or the proceeds of insurance.

     Notwithstanding anything to the contrary in this prospectus, in the case of
a trust fund for which a REMIC election has been made, the master servicer will
not liquidate any collateral acquired through foreclosure later than one year
after the acquisition of the collateral. While the holder of Mortgaged Property
acquired through foreclosure can often maximize its recovery by providing
financing to a new purchaser, the trust fund will have no ability to do so and
neither the master servicer nor any servicer will be required to do so.

     Similarly, if any property securing a defaulted Loan is damaged and
proceeds, if any, from the related standard hazard insurance policy or the
applicable special hazard insurance policy, if any, are insufficient to restore
the damaged property to a condition sufficient to permit recovery under any pool
insurance policy or any primary mortgage insurance policy, FHA insurance, or VA
guarantee, neither the master servicer nor any servicer will be required to
expend its own funds to restore the damaged property unless it determines (1)
that the restoration will increase the Liquidation Proceeds in respect of the
Loan after reimbursement of the expenses incurred by the servicer or the master
servicer and (2) that the expenses will be recoverable by it through proceeds of
the sale of the property or proceeds of the related pool insurance policy or any
related primary mortgage insurance policy, FHA insurance, or VA guarantee.

     As to collateral securing a Cooperative Loan, any prospective purchaser
will generally have to obtain the approval of the board of directors of the
relevant cooperative before purchasing the shares and acquiring rights under the
proprietary lease or occupancy agreement securing that Cooperative Loan. See
"Legal Aspects of Loans -- Realizing Upon Cooperative Loan Security." 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 approval could
limit the number of potential purchasers for those shares and otherwise limit
the trust fund's ability to sell and realize the value of those shares.

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

ENFORCEMENT OF DUE-ON-SALE CLAUSES

     Typically, when any Mortgaged Property is about to be conveyed by the
borrower, the master servicer will, to the extent it has knowledge of the
prospective conveyance and prior to the


                                       42


conveyance, exercise its rights to accelerate the maturity of the Loan under the
applicable "due-on-sale" clause, if any, unless it reasonably believes that the
clause is not enforceable under applicable law or if the enforcement of the
clause would result in loss of coverage under any primary mortgage insurance
policy. In this case, or if the master servicer reasonably believes that
enforcement of a due-on-sale clause will not be enforceable, the master servicer
is authorized to accept from or enter into an assumption agreement with the
person to whom the property has been or is about to be conveyed, pursuant to
which that person becomes liable under the Loan and pursuant to which the
original borrower is released from liability and that person is substituted as
the borrower and becomes liable under the Loan. Any fee collected in connection
with an assumption will be retained by the master servicer as additional
servicing compensation. The terms of a Loan may not be changed in connection
with an assumption except that, if the terms of the Loan so permit, and subject
to certain other conditions, the interest rate may be increased (but not
decreased) to a prevailing market rate. Unless otherwise specified in the
prospectus supplement, securityholders would not benefit from any increase.

CERTAIN RIGHTS RELATED TO FORECLOSURE

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

SERVICING COMPENSATION AND PAYMENT OF EXPENSES

     The master servicer or any servicer will be entitled to a servicing fee in
an amount to be determined as specified in the prospectus supplement. The
servicing fee may be fixed or variable. In addition, the master servicer or any
servicer will be entitled to servicing compensation in the form of assumption
fees, late payment charges, or excess proceeds following disposition of property
in connection with defaulted Loans.

     As provided in the prospectus supplement, the trust fund or the master
servicer will pay the fees of the servicers, if any, and certain expenses
incurred in connection with the servicing of the Loans, including, without
limitation, the payment of the fees and expenses of the trustee and independent
accountants, the payment of insurance policy premiums and the cost of credit
support, if any, and the payment of expenses incurred in enforcing the
obligations of servicers and in preparation of reports to securityholders.
Certain of these expenses may be reimbursable pursuant to the terms of the
related Agreement from Liquidation Proceeds and the proceeds of insurance
policies and, in the case of enforcement of the obligations of servicers, from
any recoveries in excess of amounts due with respect to the related Loans or
from specific recoveries of costs.

     The master servicer will be entitled to reimbursement for certain expenses
incurred by it in connection with the liquidation of defaulted Loans. The
related trust fund will suffer no loss by reason of the expenses to the extent
claims are paid under related insurance policies or from the Liquidation
Proceeds. If claims are either not made or paid under the applicable insurance
policies or if coverage thereunder has been exhausted, the related trust fund
will suffer a loss to the extent that Liquidation Proceeds, after reimbursement
of the master servicer's expenses, are less than the outstanding principal
balance of and unpaid interest on the related Loan that would be distributable
to securityholders.


                                       43


     In addition, the master servicer will be entitled to reimbursement of
expenditures incurred by it in connection with the restoration of property
securing a defaulted Loan, the right of reimbursement being prior to the rights
of the securityholders to receive any related proceeds of insurance policies,
Liquidation Proceeds or amounts derived from other credit supports. The master
servicer is also entitled to reimbursement from the Collection Account for
Advances. In addition, when a borrower makes a principal prepayment in full
between Due Dates on the related Loan, the borrower will generally be required
to pay interest on the amount prepaid only to the date of prepayment.

     If and to the extent provided in the prospectus supplement, in order that
one or more classes of the securityholders of a series will not be adversely
affected by any resulting shortfall in interest, the amount of the Servicing Fee
may be reduced to the extent necessary to include in the master servicer's
remittance to the trustee for deposit into the Distribution Account an amount
equal to a full scheduled payment of interest on the related Loan (adjusted to
the applicable Interest Rate). Any principal prepayment, together with a full
Scheduled Payment of interest thereon at the applicable Interest Rate (to the
extent of the adjustment or advance), will be distributed to securityholders on
the related Distribution Date. If the amount necessary to include a full
Scheduled Payment of interest as described above exceeds the amount of the
Servicing Fee, a shortfall to securityholders may occur as a result of a
prepayment in full. See "Yield, Prepayment and Maturity Considerations."

     The rights of the master servicer to receive funds from the Collection
Account for a series, whether as the Servicing Fee or other compensation, or for
the reimbursement of Advances, expenses or otherwise, are not subordinate to the
rights of securityholders of the related series.

EVIDENCE AS TO COMPLIANCE

     If specified in the prospectus supplement, the related Agreement for each
series will provide that each year, a firm of independent public accountants
will furnish a statement to the trustee to the effect that the firm has examined
certain documents and records relating to the servicing of mortgage loans by the
master servicer and that, on the basis of its examination, the firm is of the
opinion that the servicing has been conducted in compliance with the related
Agreement except for exceptions that the firm believes to be immaterial and any
other exceptions as set forth in the statement.

     The related Agreement for each series may also provide for delivery to the
trustee for the series of an annual statement signed by an officer of the master
servicer to the effect that the master servicer has fulfilled its obligations
under the Agreement throughout the preceding calendar year.

CERTAIN MATTERS REGARDING THE MASTER SERVICER

     The master servicer for each series, if any, will be identified in the
prospectus supplement. The master servicer may be an affiliate of the depositor
and may have other business relationships with the depositor and its affiliates.

     In the event of an event of default under the related Agreement, the master
servicer may be replaced by the trustee or a successor master servicer. See "The
Agreements -- Event of Default; Rights upon Events of Default."

     The master servicer will generally have the right to assign its rights and
delegate its duties and obligations under the related Agreement for each series;
provided that the purchaser or transferee accepting the assignment or
delegation:

     o  is qualified to service mortgage loans for Fannie Mae or Freddie Mac;

     o  is reasonably satisfactory to the trustee for the related series;

     o  has a net worth of not less than $15,000,000; and

     o  executes and delivers to the trustee an agreement, in form and substance
        reasonably satisfactory to the trustee, which contains an assumption by
        the purchaser or transferee of the due and punctual performance and
        observance of each covenant and condition to be performed or observed by
        the master servicer under the related Agreement from and after the date
        of the agreement;


                                       44


provided further that each Rating Agency's rating of the Securities for the
related series in effect immediately prior to the assignment, sale or transfer
is not qualified, downgraded or withdrawn as a result of the assignment, sale or
transfer.

    No assignment will become effective until the trustee or a successor master
servicer has assumed the master servicer's obligations and duties under the
related Agreement. To the extent that the master servicer transfers its
obligations to a wholly-owned subsidiary or affiliate, the subsidiary or
affiliate need not satisfy the criteria set forth above, however, in this case,
the assigning master servicer will remain liable for the servicing obligations
under the related Agreement. Any entity into which the master servicer is merged
or consolidated or any successor corporation resulting from any merger,
conversion or consolidation will succeed to the master servicer's obligations
under the related Agreement, provided that the successor or surviving entity
meets the requirements for a successor master servicer set forth in the
preceding paragraph.

     Each Agreement will also provide that neither the master servicer, nor any
director, officer, employee or agent of the master servicer, will be under any
liability to the related trust fund or the securityholders for any action taken
or for failing to take any action in good faith pursuant to the related
Agreement or for errors in judgment; provided, however, that neither the master
servicer nor any such person will be protected against any breach of warranty or
representations made under the related Agreement or the failure to perform its
obligations in compliance with any standard of care set forth in the related
Agreement or liability that would otherwise be imposed by reason of willful
misfeasance, bad faith or negligence in the performance of their duties or by
reason of reckless disregard of their obligations and duties thereunder.

     Each Agreement will further provide that the master servicer and any
director, officer, employee or agent of the master servicer is entitled to
indemnification from the related trust fund and will be held harmless against
any loss, liability or expense incurred in connection with any legal action
relating to the Agreements or the Securities, other than any loss, liability or
expense incurred by reason of willful misfeasance, bad faith or negligence in
the performance of duties thereunder or by reason of reckless disregard of
obligations and duties thereunder. In addition, the related Agreement provides
that the master servicer is not under any obligation to appear in, prosecute or
defend any legal action that is not incidental to its servicing responsibilities
under the related Agreement which, in its opinion, may involve it in any expense
or liability. The master servicer may, in its discretion, undertake any action
which it may deem necessary or desirable with respect to the related Agreement
and the rights and duties of the parties thereto and the interests of the
securityholders thereunder. In this case, the legal expenses and costs of the
action and any liability resulting therefrom will be expenses, costs, and
liabilities of the trust fund and the master servicer will be entitled to be
reimbursed therefor out of the Collection Account.

CERTAIN RISKS

     If the master servicer or servicer were to become a debtor in a bankruptcy
proceeding, it could seek to reject its obligations under the Agreement pursuant
to Section 365 of the Bankruptcy Code, thus forcing the trustee to appoint a
successor servicer or master servicer.

     If the master servicer or servicer resigns or is in default and the cost
of servicing the Loans has increased, the trustee may not be able to find a
successor master servicer or servicer willing to service the loans for the
master servicing fee or servicing fee specified in the applicable Agreement.
These circumstances might cause the trustee to seek authority from
securityholders to increase the applicable fee to an amount necessary to
provide acceptable compensation to the then current master servicer or servicer
or any replacement master servicer or servicer. If such approval were not
granted by securityholders, under the law generally applicable to trusts the
trustee could seek approval for such an increase from a court if such increase
were necessary for the preservation or continued administration of the trust.
Any increase in the master servicing fee or servicing fee would reduce amounts
available for distribution to securityholders, particularly holders of
subordinate securities.


                                       45


                                CREDIT SUPPORT

GENERAL

     Credit support may be provided with respect to one or more classes of a
series of Securities or for the related Primary Assets. Credit support may take
the form of one or more of the following:

     o  an irrevocable letter of credit;

     o  the subordination of one or more classes of the Securities of a series;

     o  reserve funds;

     o  a pool insurance policy, bankruptcy bond, repurchase bond or special
        hazard insurance policy;

     o  a surety bond or financial guaranty insurance policy;

     o  the use of cross-support features; or

     o  another method of credit support described in the prospectus supplement.

     In all cases, the amounts and terms and conditions of the credit support
must be acceptable to each Rating Agency. If specified in the prospectus
supplement, any form of credit support may be structured so as to protect
against losses relating to more than one trust fund.

     Unless otherwise specified in the prospectus supplement for a series, the
credit support will not provide protection against all risks of loss and will
not guarantee repayment of the entire principal balance of the Securities and
interest thereon at the applicable Interest Rate. If losses occur which exceed
the amount covered by credit support or which are not covered by the credit
support, securityholders will bear their allocable share of deficiencies. See
"The Agreement -- Event of Default; Rights Upon Event of Default." Moreover, if
a form of credit support covers more than one trust fund (each, a "Covered
Trust"), holders of Securities issued by any of the Covered Trusts will be
subject to the risk that the credit support will be exhausted by the claims of
other Covered Trusts prior to the Covered Trust receiving any of its intended
share of the coverage.

     If credit support is provided with respect to a series, or the related
Primary Assets, the prospectus supplement will include a description of:

     o  the amount payable under the credit support;

     o  any conditions to payment thereunder not otherwise described in this
        prospectus;

     o  the conditions (if any) under which the amount payable under the credit
        support may be reduced and under which the credit support may be
        terminated or replaced; and

     o  the material provisions of any agreement relating to the credit support.

     Additionally, the prospectus supplement will set forth certain information
with respect to the issuer of any third-party credit support, including:

     o  a brief description of its principal business activities;

     o  its principal place of business, place of incorporation and the
        jurisdiction under which it is chartered or licensed to do business;

     o  if applicable, the credit ratings assigned to it by rating agencies; and

     o  certain financial information.

SUBORDINATE SECURITIES; SUBORDINATION RESERVE FUND

     If specified in the prospectus supplement, one or more classes of a series
may be Subordinate Securities. If specified in the prospectus supplement, the
rights of the Subordinate securityholders to receive distributions of principal
and interest from the Distribution Account on any Distribution Date


                                       46


will be subordinated to the rights of the Senior securityholders to the extent
of the then applicable "Subordinated Amount" as defined in the prospectus
supplement. The Subordinated Amount will decrease whenever amounts otherwise
payable to the Subordinate securityholders are paid to the senior
securityholders (including amounts withdrawn from the subordination reserve
fund, if any, established pursuant to the related Agreement (the "Subordination
Reserve Fund") and paid to the senior securityholders), and will (unless
otherwise specified in the prospectus supplement) increase whenever there is
distributed to the holders of Subordinate Securities amounts in respect of which
subordination payments have previously been paid to the senior securityholders
(which will occur when subordination payments in respect of delinquencies and
certain other deficiencies have been recovered).

     A series may include a class of Subordinate Securities entitled to receive
cash flows remaining after distributions are made to all other classes. This
right will effectively be subordinate to the rights of other securityholders,
but will not be limited to the Subordinated Amount. If specified in the
prospectus supplement, the subordination of a class may apply only in the event
of (or may be limited to) certain types of losses not covered by Insurance
Policies or other credit support, such as losses arising from damage to property
securing a Loan not covered by standard hazard insurance policies, losses
resulting from the bankruptcy of a borrower and application of certain
provisions of the federal bankruptcy code, 11 United States Code Section 101 et
seq., and related rules and regulations promulgated thereunder (the "Bankruptcy
Code"), or losses resulting from the denial of insurance coverage due to fraud
or misrepresentation in connection with the origination of a Loan.

     With respect to any series that includes one or more classes of Subordinate
Securities, a Subordination Reserve Fund may be established if specified in the
prospectus supplement. The Subordination Reserve Fund, if any, will be funded
with cash, an irrevocable letter of credit, a demand note or Eligible Reserve
Fund Investments, or by the retention of amounts of principal or interest
otherwise payable to holders of Subordinate Securities, or both, as specified in
the prospectus supplement. The Subordination Reserve Fund will not be a part of
the trust fund, unless otherwise specified in the prospectus supplement. If the
Subordination Reserve Fund is not a part of the trust fund, the trustee will
have a security interest therein on behalf of the senior securityholders. Moneys
will be withdrawn from the Subordination Reserve Fund to make distributions of
principal of or interest on Senior Securities under the circumstances set forth
in the prospectus supplement.

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

CROSS-SUPPORT FEATURES

     If the Primary Assets for a series are divided into separate Asset Groups,
beneficial ownership of which is evidenced by, or which secure, a separate class
or classes of a series, credit support may be provided by a cross-support
feature that requires that distributions be made on Senior Securities backed by
one Asset Group prior to distributions on Subordinate Securities backed by
another Asset Group within the trust fund. The prospectus supplement for a
series that includes a cross-support feature will describe the manner and
conditions for applying the cross-support feature.

INSURANCE

     Credit support with respect to a series may be provided by various forms of
insurance policies, subject to limits on the aggregate dollar amount of claims
that will be payable under each insurance


                                       47


policy, with respect to all Loans comprising or underlying the Primary Assets
for a series, or those Loans with certain characteristics. The insurance
policies include primary mortgage insurance and standard hazard insurance and
may, if specified in the prospectus supplement, include a pool insurance policy
covering losses in amounts in excess of coverage of any primary insurance
policy, a special hazard insurance policy covering certain risks not covered by
standard hazard insurance policies, a bankruptcy bond covering certain losses
resulting from the bankruptcy of a borrower and application of certain
provisions of the Bankruptcy Code, a repurchase bond covering the repurchase of
a Loan for which mortgage insurance or hazard insurance coverage has been denied
due to misrepresentations in connection with the origination of the related
Loan, or other insurance covering other risks associated with the particular
type of Loan. See "Description of Mortgage and Other Insurance."

     Copies of the actual pool insurance policy, special hazard insurance
policy, bankruptcy bond or repurchase bond, if any, relating to the Loans
comprising the Primary Assets for a series will be filed with the Commission as
an exhibit to a Current Report on Form 8-K to be filed within 15 days of
issuance of the Securities of the related series.

LETTER OF CREDIT

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

FINANCIAL GUARANTY INSURANCE POLICY

     Credit support may be provided in the form of a financial guaranty
insurance policy by one or more insurance companies named in the prospectus
supplement. The financial guaranty insurance policy will guarantee, with respect
to one or more classes of Securities of the related series, timely distributions
of interest and full distributions of principal on the basis of a schedule of
principal distributions set forth in or determined in the manner specified in
the prospectus supplement. If specified in the prospectus supplement, the
financial guaranty insurance policy will also guarantee against any payment made
to a securityholder that is subsequently recovered as a "voidable preference"
payment under the Bankruptcy Code. A copy of the financial guaranty insurance
policy for a series, if any, will be filed with the Commission as an exhibit to
a Current Report on Form 8-K to be filed with the Commission within 15 days
following the issuance of the Securities of the related series.

RESERVE FUNDS

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


                                       48


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

     Moneys deposited in any Reserve Funds will be invested in Eligible Reserve
Fund Investments, except as otherwise specified in the prospectus supplement.
Unless otherwise specified in the prospectus supplement, any reinvestment
income or other gain from the investments will be credited to the related
Reserve Fund for the series, and any loss resulting from the investments will
be charged to the Reserve Fund. However, this income may be payable to the
master servicer or a servicer as additional servicing compensation. See
"Servicing of Loans" and "The Agreements -- Investment of Funds." The Reserve
Fund, if any, for a series will not be a part of the trust fund unless
otherwise specified in the prospectus supplement.

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


                                       49


                  DESCRIPTION OF MORTGAGE AND OTHER INSURANCE

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

MORTGAGE INSURANCE ON THE LOANS

     General

     Unless otherwise specified in the prospectus supplement, all Mortgage Loans
that are Conventional Loans secured by Single Family Property and which had
initial Loan-to-Value Ratios of greater than 80% will be covered by primary
mortgage insurance policies providing coverage with respect to the amount of
each Mortgage Loan in excess of 75% of the original Appraised Value of the
related Mortgaged Property and remaining in force until the principal balance of
the Mortgage Loan is reduced to 80% of the original Appraised Value.

     A pool insurance policy will be obtained if specified in the prospectus
supplement to cover any loss (subject to limitations described in this
prospectus) occurring as a result of default by the borrowers to the extent not
covered by any primary mortgage insurance policy or FHA Insurance. See "-- Pool
Insurance Policy" below. Neither the primary mortgage insurance policies nor any
pool insurance policy will insure against certain losses sustained in the event
of a personal bankruptcy of the borrower under a Mortgage Loan. See "Legal
Aspects of Loans." These losses will be covered to the extent described in the
prospectus supplement by the bankruptcy bond or other credit support, if any.

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

     Primary Mortgage Insurance

     Although the terms and conditions of primary mortgage insurance vary, the
amount of a claim for benefits under a primary mortgage insurance policy
covering a Mortgage Loan (referred to as the "Insured Loss") generally will
consist of the insured percentage (typically ranging from 12% to 25%) of the
unpaid principal amount of the covered Mortgage Loan and accrued and unpaid
interest thereon and reimbursement of certain expenses, less:

     o  all rents or other payments collected or received by the insured (other
        than the proceeds of hazard insurance) that are derived from or in any
        way related to the Mortgaged Property;

     o  hazard insurance proceeds in excess of the amount required to restore
        the mortgaged property and which have not been applied to the payment of
        the Mortgage Loan;

     o  amounts expended but not approved by the mortgage insurer;

     o  claim payments previously made by the mortgage insurer; and

     o  unpaid premiums.

     Primary mortgage insurance policies reimburse certain losses sustained by
reason of defaults in payments by borrowers. Primary mortgage insurance
policies will not insure against, and exclude from coverage, a loss sustained
by reason of a default arising from or involving certain matters, including:

     o  fraud or negligence in origination or servicing of the Mortgage Loans,
        including misrepresentation by the originator, borrower or other persons
        involved in the origination of the Mortgage Loan;


                                       50


     o  failure to construct the Mortgaged Property subject to the Mortgage Loan
        in accordance with specified plans;

     o  physical damage to the Mortgaged Property; and

     o  the related servicer not being approved as a servicer by the mortgage
        insurer.

     Primary mortgage insurance policies generally contain provisions
substantially as follows: (1) under the policy, a claim includes unpaid
principal, accrued interest at the applicable loan interest rate to the date of
filing of a claim thereunder and certain advances (with a limitation on
attorneys' fees for foreclosures of 3% of the unpaid principal balance and
accumulated delinquent interest) described below; (2) when a claim is presented,
the mortgage insurer will have the option of paying the claim in full and taking
title to the property and arranging for the sale thereof or paying the insured
percentage of the claim and allowing the insured to retain title to the
property; (3) unless earlier directed by the mortgage insurer, claims must be
made within a specified period of time (typically, 60 days) after the insured
has acquired good and marketable title to the property; and (4) a claim must be
paid within a specific period of time (typically, 60 days) after the claim is
accepted by the mortgage insurer.

     As conditions precedent to the filing of or payment of a claim under a
primary mortgage insurance policy covering a Mortgage Loan, the insured will be
required to:

     o  advance or discharge all hazard insurance policy premiums, and as
        necessary and approved in advance by the mortgage insurer, (1) real
        estate property taxes, (2) all expenses required to maintain the related
        Mortgaged Property in at least as good a condition as existed at the
        effective date of the primary mortgage insurance policy, ordinary wear
        and tear excepted, (3) Mortgaged Property sales expenses, (4) any
        outstanding liens (as defined in the primary mortgage insurance policy)
        on the Mortgaged Property and (5) foreclosure costs, including court
        costs and reasonable attorneys' fees;

     o  in the event of any physical loss or damage to the Mortgaged Property,
        restore and repair the Mortgaged Property to at least as good a
        condition as existed at the effective date of the primary mortgage
        insurance policy, ordinary wear and tear excepted; and

     o  tender to the mortgage insurer good and marketable title to and
        possession of the Mortgaged Property.

     Other provisions and conditions of each primary mortgage insurance policy
covering a Mortgage Loan will generally include that:

     o  no change may be made in the terms of the Mortgage Loan without the
        consent of the mortgage insurer;

     o  written notice must be given to the mortgage insurer within 10 days
        after the insured becomes aware that a borrower is delinquent in the
        payment of a sum equal to the aggregate of two Scheduled Payments due
        under the Mortgage Loan or that any proceedings affecting the borrower's
        interest in the Mortgaged Property securing the Mortgage Loan have been
        commenced, and thereafter the insured must report monthly to the
        mortgage insurer the status of any Mortgage Loan until the Mortgage Loan
        is brought current, the proceedings are terminated or a claim is filed;

     o  the mortgage insurer will have the right to purchase the Mortgage Loan,
        at any time subsequent to the 10 days' notice described above and prior
        to the commencement of foreclosure proceedings, at a price equal to the
        unpaid principal amount of the Mortgage Loan plus accrued and unpaid
        interest thereon at the applicable Mortgage Rate and reimbursable
        amounts expended by the insured for the real estate taxes and fire and
        extended coverage insurance on the Mortgaged Property for a period not
        exceeding 12 months and less the sum of any claim previously paid under
        the policy with respect to the Mortgage Loan and any due and unpaid
        premium with respect to the policy;


                                       51


     o  the insured must commence proceedings at certain times specified in the
        policy and diligently proceed to obtain good and marketable title to and
        possession of the mortgaged property;

     o  the insured must notify the mortgage insurer of the institution of any
        proceedings, provide it with copies of documents relating thereto,
        notify the mortgage insurer of the price amounts specified above at
        least 15 days prior to the sale of the Mortgaged Property by
        foreclosure, and bid that amount unless the mortgage insurer specifies a
        lower or higher amount; and

     o  the insured may accept a conveyance of the Mortgaged Property in lieu of
        foreclosure with written approval of the mortgage insurer, provided the
        ability of the insured to assign specified rights to the mortgage
        insurer are not thereby impaired or the specified rights of the mortgage
        insurer are not thereby adversely affected.

     The mortgage insurer will be required to pay to the insured either: (1) the
insured percentage of the loss; or (2) at its option under certain of the
primary mortgage insurance policies, the sum of the delinquent Scheduled
Payments plus any advances made by the insured, both to the date of the claim
payment, and thereafter, Scheduled Payments in the amount that would have become
due under the Mortgage Loan if it had not been discharged plus any advances made
by the insured until the earlier of (a) the date the Mortgage Loan would have
been discharged in full if the default had not occurred, or (b) an approved
sale. Any rents or other payments collected or received by the insured that are
derived from or are in any way related to the mortgaged property will be
deducted from any claim payment.

     FHA Insurance and VA Guaranty

     The benefits of the FHA insurance and VA guaranty are limited, as described
below. To the extent that amounts payable under the applicable policy are
insufficient to cover losses in respect of the related Mortgage Loan, any loss
in excess of the applicable credit enhancement will be borne by securityholders.

     Under both the FHA and VA programs the master servicer or servicer must
follow certain prescribed procedures in submitting claims for payment. Failure
to follow procedures could result in delays in receipt of the amount of proceeds
collected in respect of any liquidated Mortgage Loan under the applicable FHA
insurance or VA guaranty ("FHA/VA Claim Proceeds") and reductions in FHA/VA
Claim Proceeds received.

     FHA, a division of HUD, is responsible for administering federal mortgage
insurance programs authorized under the Federal Housing Act of 1934, as amended,
and the United States Housing Act of 1937, as amended. FHA Mortgage Loans are
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 as well as to refinance an existing insured
mortgage. These programs generally limit the principal amount of the mortgage
loans insured. Mortgage loans originated prior to October 21, 1998, and insured
by the FHA generally require a minimum down payment of approximately 3% to 5% of
the acquisition cost, which includes the lesser of the appraised value or sales
price, plus eligible closing costs, subject to a maximum loan-to-value ratio of
approximately 97%. Mortgage loans originated on or after October 21, 1998, and
insured by the FHA generally require a minimum cash investment of 3% of the
lesser of appraised value or sales price, subject to a maximum loan-to-value
ratio (generally, approximately 97.75%) that is determined based on the loan
amount and the state in which the mortgaged property is located.

     The monthly or periodic insurance premiums for FHA Mortgage Loans will be
collected by the master servicer or servicer and paid to FHA. The regulations
governing FHA single-family mortgage insurance programs provide that insurance
benefits are payable upon foreclosure (or other acquisition or possession) and
in general, conveyance of the mortgaged property to HUD. With respect to a
defaulted FHA Mortgage Loan, a master servicer or servicer is limited in its
ability to initiate foreclosure proceedings. When it is determined by a master
servicer or servicer or HUD that default was caused by circumstances beyond the
borrower's control, the master servicer or servicer is expected to make an
effort to avoid foreclosure by entering, if feasible, into one of a number of
available forms of forbearance plans with the borrower. Relief may involve the
reduction or suspension of Scheduled


                                       52


Payments for a specified period, which payments are to be made up on or before
the maturity date of the Mortgage Loan, or the rescheduling or other adjustment
of payments due under the Mortgage Loan up to or beyond the scheduled maturity
date. In addition, when a default caused by specified circumstances is
accompanied by certain other factors, HUD may provide relief by making payments
to a master servicer or servicer in partial or full satisfaction of amounts due
under the Mortgage Loan (which payments, under certain circumstances, are to be
repaid by the borrower to HUD). With certain exceptions, at least three full
installments must be due and unpaid under the Mortgage Loan before a master
servicer or servicer may initiate foreclosure proceedings.

     HUD terminated its assignment program for borrowers, effective April 25,
1996. Borrowers who did not request the assignment of their mortgage to HUD
prior to that date are ineligible for consideration. Under this terminated
program, HUD previously accepted assignment of defaulted mortgages and paid
insurance benefits to lenders. The program was available only to eligible
borrowers whose default was caused by circumstances beyond their control.

     On March 20, 1998, an Illinois Federal District Court in Ferrell v. United
States Department of Housing and Urban Development (N.D. Ill. (No. 73C 334))
granted a preliminary injunction requiring HUD to reinstate the assignment
program or an equivalent substitute. Plaintiffs in Ferrell have alleged that HUD
is required to maintain the program pursuant to the terms of prior court order.
It is difficult to assess what effect, if any, the final outcome of the Ferrell
litigation will have on FHA claim policies or procedures and what effect changes
in these policies or procedures, if any are made, will have on the servicing of
FHA Mortgage Loans.

     HUD has the option, in most cases, to pay insurance claims in cash or in
debentures issued by HUD. Current practice is to pay claims in cash, and claims
have not been paid in debentures since 1965. HUD debentures issued in
satisfaction of FHA insurance claims bear interest at the applicable HUD
debenture interest rate. The related master servicer or servicer will be
obligated to purchase any such debenture issued in satisfaction of a defaulted
FHA Mortgage Loan for an amount equal to the principal balance of the debenture.

     The amount of insurance benefits generally paid by the FHA is equal to the
unpaid principal balance of the defaulted mortgage loan, plus amounts to
reimburse the mortgagee for certain costs and expenses, less certain amounts
received or retained by the mortgagee after default. When entitlement to
insurance benefits results from foreclosure (or other acquisition of possession)
and conveyance to HUD, the mortgagee is compensated for no more than two-thirds
of its foreclosure costs, and for interest accrued and unpaid from a date 60
days after the borrower's first uncorrected failure to perform any obligation or
make any payment due under the mortgage loan and, upon assignment, interest from
the date of assignment to the date of payment of the claim, in each case at the
applicable HUD debenture interest rate, provided all applicable HUD requirements
have been met.

     Although FHA insurance proceeds include accrued and unpaid interest on the
defaulted mortgage loan, the amount of interest paid may be substantially less
than accrued interest. As described above, FHA will reimburse interest at the
applicable debenture interest rate, which will generally be lower than the
Mortgage Rate on the related Mortgage Loan. Negative interest spread between the
debenture rate and the Mortgage Rate, as well as the failure of FHA insurance to
cover the first 60 days of accrued and unpaid interest and all foreclosure
expenses as described above, could result in losses to securityholders. The
interest payable may be curtailed if a master servicer or servicer has not met
FHA's timing requirements for certain actions during the foreclosure and
conveyance process. When a master servicer or servicer exceeds the timing
requirements and has not obtained an extension from FHA, FHA will pay interest
only to the date the particular action should have been completed.

     VA Mortgage Loans are partially guaranteed by the VA under the Servicemen's
Readjustment Act of 1944, as amended, which 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 or to refinance an existing guaranteed loan. The program requires no down
payment from the purchaser and permits the guarantee of mortgage loans of up to
30 years' duration.


                                       53


The maximum guaranty that may be issued by the VA under a VA guaranteed mortgage
loan depends upon the original principal balance of the mortgage loan. At
present, the maximum guaranty that may be issued by the VA under a VA guaranteed
mortgage loan is 50% of the unpaid principal balance of a loan of $45,000 or
less, $22,500 for any loan of more than $45,000 but less than $56,250, to the
lesser of $36,000 or 40% of the principal balance of a loan of $56,251 to
$144,000, and, for loans of more than $144,000, the lesser of 25% of the
principal balance of the mortgage loan or $60,000.

     With respect to a defaulted VA guaranteed mortgage loan, the mortgagee is,
absent exceptional circumstances, authorized to foreclose only after the default
has continued for three months. Generally, a claim for the guarantee is
submitted after foreclosure and after the filing with the VA by the mortgagee of
a notice of election to convey the related mortgaged property to the VA.

     In instances where the net value of the mortgaged property securing a VA
guaranteed mortgage loan is less than the unguaranteed portion of the
indebtedness outstanding (including principal, accrued interest and certain
limited foreclosure costs and expenses) on the related mortgage loan, the VA may
notify the mortgagee that it will not accept conveyance of the mortgaged
property (a "No-Bid"). In the case of a No-Bid, the VA will pay certain guaranty
benefits to the mortgagee and the mortgagee will generally take title to and
liquidate the mortgaged property. The guaranty benefits payable by the VA in the
case of a No-Bid will be an amount equal to the original guaranteed amount or,
if less, the initial guarantee percentage multiplied by the outstanding
indebtedness with respect to the defaulted mortgage loan. The amount of the
guarantee decreases pro rata with any decrease in the amount of indebtedness
(which may include accrued and unpaid interest and certain expenses of the
mortgagee, including foreclosure expenses) up to the amount originally
guaranteed.

     When the mortgagee receives the VA's No-Bid instructions with respect to a
defaulted mortgage loan, the mortgagee has the right (but not the obligation) to
waive or satisfy a portion of the indebtedness outstanding with respect to the
defaulted mortgage loan by an amount that would cause the unguaranteed portion
of the indebtedness (including principal, accrued interest and certain limited
foreclosure costs and expenses) after giving effect to the reduction to be less
than the net value of the mortgaged property securing the mortgage loan (a
"Buydown"). In the case of a Buydown, the VA will accept conveyance of the
mortgaged property and the mortgagee will suffer a loss to the extent of the
indebtedness that was satisfied or waived in order to effect the Buydown, in
addition to any other losses resulting from unreimbursed foreclosure costs and
expenses and interest that may have accrued beyond the applicable VA cut-off
date.

     In the event the VA elects a No-Bid, the amount paid by the VA cannot
exceed the original guaranteed amount or, if less, the initial guarantee
percentage multiplied by the outstanding indebtedness with respect to the
defaulted Mortgage Loan. The amount of the guarantee decreases pro rata with any
decrease in the amount of indebtedness, as described above. As a result of these
limitations, losses associated with defaulted VA Mortgage Loans could be
substantial.

     Pool Insurance Policy

     If specified in the prospectus supplement, the master servicer will be
required to maintain a pool insurance policy for the Loans in the trust fund on
behalf of the trustee and the securityholders. See "Servicing of Loans --
Maintenance of Insurance Policies and Other Servicing Procedures." Although the
terms and conditions of pool insurance policies vary to some degree, the
following describes material aspects of the policies generally.

     The prospectus supplement will describe any provisions of a pool insurance
policy that are materially different from those described below. It may also be
a condition precedent to the payment of any claim under the pool insurance
policy that the insured maintain a primary mortgage insurance policy that is
acceptable to the pool insurer on all Mortgage Loans in the related trust fund
that have Loan-to-Value Ratios at the time of origination in excess of 80% and
that a claim under the primary mortgage insurance policy has been submitted and
settled. FHA Insurance and VA Guarantees may be deemed to be acceptable primary
insurance policies under the pool insurance policy.

     Assuming satisfaction of these conditions, the pool insurer will pay to the
insured the amount of the loss which will generally be:


                                       54


     o  the amount of the unpaid principal balance of the defaulted Mortgage
        Loan immediately prior to the approved sale of the Mortgaged Property;

     o  the amount of the accumulated unpaid interest on the Mortgage Loan to
        the date of claim settlement at the contractual rate of interest; and

     o  advances made by the insured as described above less certain payments.

     An "approved sale" is:

     o  a sale of the Mortgaged Property acquired by the insured because of a
        default by the borrower to which the pool insurer has given prior
        approval;

     o  a foreclosure or trustee's sale of the Mortgaged Property at a price
        exceeding the maximum amount specified by the pool insurer;

     o  the acquisition of the Mortgaged Property under the primary mortgage
        insurance policy by the mortgage insurer; or

     o  the acquisition of the Mortgaged Property by the pool insurer.

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

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

     Mortgage Insurance with Respect to Manufactured Home Loans

     A Manufactured Home Loan may be an FHA Loan or a VA Loan. Any primary
mortgage or similar insurance and any pool insurance policy with respect to
Manufactured Home Loans will be described in the prospectus supplement.

HAZARD INSURANCE ON THE LOANS

     Standard Hazard Insurance Policies

     The standard hazard insurance policies will provide for coverage at least
equal to the applicable state standard form of fire insurance policy with
extended coverage for property of the type securing the related Loans. In
general, the standard form of fire and extended coverage policy will cover
physical damage to or destruction of, the improvements on the property caused by
fire, lightning, explosion, smoke, windstorm, hail, riot, strike and civil
commotion, subject to the conditions and


                                       55


exclusions particularized in each policy. Because the standard hazard insurance
policies relating to the Loans will be underwritten by different hazard insurers
and will cover properties located in various states, the policies will not
contain identical terms and conditions. The basic terms, however, generally will
be determined by state law and generally will be similar. Most policies
typically will not cover any physical damage resulting from war, revolution,
governmental actions, floods and other water-related causes, earth movement
(including earthquakes, landslides, and mudflows), nuclear reaction, wet or dry
rot, vermin, rodents, insects or domestic animals, theft and, in certain cases,
vandalism. The foregoing list is merely indicative of certain kinds of uninsured
risks and is not intended to be all-inclusive. Uninsured risks not covered by a
special hazard insurance policy or other form of credit support will adversely
affect distributions to securityholders. When a property securing a Loan is
located in a flood area identified by HUD pursuant to the Flood Disaster
Protection Act of 1973, as amended, the master servicer will be required to
cause flood insurance to be maintained with respect to the property, to the
extent available.

     The standard hazard insurance policies covering properties securing Loans
typically will contain a "coinsurance" clause which, in effect, will require the
insured at all times to carry hazard insurance of a specified percentage
(generally 80% to 90%) of the full replacement value of the dwellings,
structures and other improvements on the Mortgaged Property in order to recover
the full amount of any partial loss. If the insured's coverage falls below this
specified percentage, the clause will provide that the hazard insurer's
liability in the event of partial loss will not exceed the greater of (1) the
actual cash value (generally defined as the replacement cost at the time and
place of loss, less physical depreciation) of the dwellings, structures and
other improvements damaged or destroyed and (2) the proportion of the loss,
without deduction for depreciation, as the amount of insurance carried bears to
the specified percentage of the full replacement cost of the dwellings,
structures and other improvements on the Mortgaged Property. Since the amount of
hazard insurance to be maintained on the improvements securing the Loans
declines as the principal balances owing thereon decrease, and since the value
of residential real estate in the area where the Mortgaged Property is located
fluctuates in value over time, the effect of this requirement in the event of
partial loss may be that hazard insurance proceeds will be insufficient to
restore fully the damage to the Mortgaged Property.

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

     Special Hazard Insurance Policy

     Although the terms of the policies vary to some degree, a special hazard
insurance policy typically provides that, where there has been damage to
property securing a defaulted or foreclosed Loan (title to which has been
acquired by the insured) and to the extent the damage is not covered by the
standard hazard insurance policy or any flood insurance policy, if applicable,
required to be maintained with respect to the property, or in connection with
partial loss resulting from the application of the coinsurance clause in a
standard hazard insurance policy, the special hazard insurer will pay the lesser
of (1) the cost of repair or replacement of the property and (2) upon transfer
of the


                                       56


property to the special hazard insurer, the unpaid principal balance of the
Loan at the time of acquisition of the property by foreclosure or deed in lieu
of foreclosure, plus accrued interest to the date of claim settlement and
certain expenses incurred by the master servicer or the servicer with respect
to the property. If the unpaid principal balance plus accrued interest and
certain expenses is paid by the special hazard insurer, the amount of further
coverage under the special hazard insurance policy will be reduced by that
amount less any net proceeds from the sale of the property. Any amount paid as
the cost of repair of the property will reduce coverage by that amount. Special
hazard insurance policies typically do not cover losses occasioned by war,
civil insurrection, certain governmental actions, errors in design, faulty
workmanship or materials (except under certain circumstances), nuclear
reaction, flood (if the mortgaged property is in a federally designated flood
area), chemical contamination and certain other risks.

     Restoration of the property with the proceeds described under (1) above is
expected to satisfy the condition under the pool insurance policy that the
property be restored before a claim under the pool insurance policy may be
validly presented with respect to the defaulted Loan secured by the property.
The payment described under (2) above will render unnecessary presentation of a
claim in respect of the Loan under the pool insurance policy. Therefore, so long
as the pool insurance policy remains in effect, the payment by the special
hazard insurer of the cost of repair or of the unpaid principal balance of the
related Loan plus accrued interest and certain expenses will not affect the
total insurance proceeds paid to holders of the Securities, but will affect the
relative amounts of coverage remaining under the special hazard insurance policy
and pool insurance policy.

     Other Hazard-Related Insurance; Liability Insurance

     With respect to Loans secured by Multifamily Property, certain additional
insurance policies may be required with respect to the Multifamily Property; for
example, general liability insurance for bodily injury or death and property
damage occurring on the property or the adjoining streets and sidewalks, steam
boiler coverage where a steam boiler or other pressure vessel is in operation,
interest coverage insurance, and rent loss insurance to cover operating income
losses following damage or destruction of the mortgaged property. With respect
to a series for which Loans secured by Multifamily Property are included in the
trust fund, the prospectus supplement will specify the required types and
amounts of additional insurance and describe the general terms of the insurance
and conditions to payment thereunder.

BANKRUPTCY BOND

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

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

REPURCHASE BOND

     If specified in the prospectus supplement, the depositor or master servicer
will be obligated to repurchase any Loan (up to an aggregate dollar amount
specified in the prospectus supplement) for


                                       57


which insurance coverage is denied due to dishonesty, misrepresentation or fraud
in connection with the origination or sale of the Loan. This obligation may be
secured by a surety bond guaranteeing payment of the amount to be paid by the
depositor or the master servicer.

                                THE AGREEMENTS

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

ISSUANCE OF SECURITIES

     Securities representing interests in a trust fund, or an Asset Group, that
the trustee will elect to have treated as a REMIC, a FASIT or a grantor trust
will be issued, and the related trust fund will be created, pursuant to a trust
agreement between the depositor and the trustee. A series of Notes issued by a
trust fund will be issued pursuant to an indenture between the related trust
fund and an indenture trustee named in the prospectus supplement. In the case of
a series of Notes, the trust fund and the depositor will also enter into a sale
and collection agreement with the indenture trustee and the issuer.

     As applicable, the trust agreement, in the case of Certificates, and the
indenture, together with the sale and collection agreement, in the case of
Notes, are referred to as the "Agreements." In the case of a series of Notes,
the trust fund will be established either as a statutory business trust under
the law of the state specified in the prospectus supplement or as a common law
trust under the law of the state specified in the prospectus supplement pursuant
to a deposit trust agreement between the depositor and an owner trustee
specified in the prospectus supplement relating to that series of Notes. The
Primary Assets of a trust fund will be serviced in accordance with one or more
underlying servicing agreements.

ASSIGNMENT OF PRIMARY ASSETS

     General

     At the time of issuance, the depositor will transfer, convey and assign to
the trustee all right, title and interest of the depositor in the Primary Assets
and other property to be included in the trust fund for a series. The assignment
will include all principal and interest due on or with respect to the Primary
Assets after the Cut-off Date specified in the prospectus supplement (except for
any Retained Interests). The trustee will, concurrently with the assignment,
execute and deliver the Securities.

     Assignment of Private Mortgage-Backed Securities

     The depositor will cause the Private Mortgage-Backed Securities to be
registered in the name of the trustee or its nominee or correspondent. The
trustee or its nominee or correspondent will have possession of any certificated
Private Mortgage-Backed Securities. Unless otherwise specified in the prospectus
supplement, the trustee will not be in possession of or be assignee of record of
any underlying assets for a Private Mortgage-Backed Security. See "The Trust
Funds -- Private Mortgage-Backed Securities."

     Each Private Mortgage-Backed Security will be identified in a schedule
appearing as an exhibit to the related Agreement (the "Mortgage Certificate
Schedule"), which will specify the original principal amount, outstanding
principal balance as of the Cut-off Date, annual pass-through rate or interest
rate and maturity date for each Private Mortgage-Backed Security conveyed to the
trustee. In the Agreement, the depositor will represent and warrant to the
trustee regarding the Private Mortgage-Backed Securities:

          (1) that the information contained in the Mortgage Certificate
     Schedule is true and correct in all material respects;


                                       58


          (2) that, immediately prior to the conveyance of the Private
     Mortgage-Backed Securities, the depositor had good title thereto, and was
     the sole owner thereof, (subject to any Retained Interests);

          (3) that there has been no other sale by it of the Private
     Mortgage-Backed Securities; and

          (4) that there is no existing lien, charge, security interest or other
     encumbrance (other than any Retained Interest) on the Private
     Mortgage-Backed Securities.

     Assignment of Mortgage Loans

     As specified in the prospectus supplement, the depositor will, as to each
Mortgage Loan, deliver or cause to be delivered to the trustee, or a custodian
on behalf of the trustee:

     o  the mortgage note endorsed without recourse to the order of the trustee
        or in blank;

     o  the original Mortgage with evidence of recording indicated thereon
        (except for any Mortgage not returned from the public recording office,
        in which case a copy of the Mortgage will be delivered, together with a
        certificate that the original of the Mortgage was delivered to the
        recording office); and

     o  an assignment of the Mortgage in recordable form.

     The trustee, or the custodian, will hold the documents in trust for the
benefit of the securityholders.

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

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

     The trustee, its agent, or a custodian will review the documents relating
to each Mortgage Loan within the time period specified in the related Agreement
after receipt thereof, and the trustee will hold the documents in trust for the
benefit of the securityholders. Unless otherwise specified in the prospectus
supplement, if any document is found to be missing or defective in any material
respect, the trustee (or the custodian) will notify the master servicer and the
depositor, and the master servicer will notify the party (the "Seller") from
which the depositor, or an affiliate thereof, purchased the Mortgage Loan.

     If the Seller cannot cure the omission or defect within the time period
specified in the related Agreement after receipt of notice, the Seller will be
obligated to purchase the related Mortgage Loan from the trustee at the Purchase
Price or, if specified in the prospectus supplement, replace the Mortgage Loan
with another mortgage loan that meets certain requirements set forth therein. We
cannot assure you that a Seller will fulfill this purchase obligation. Although
the master servicer may be obligated to enforce the obligation to the extent
described above under "Loan Underwriting Procedures and Standards --
Representations and Warranties," neither the master servicer nor the


                                       59


depositor will be obligated to purchase the Mortgage Loan if the Seller defaults
on its purchase obligation, unless the breach also constitutes a breach of the
representations or warranties of the master servicer or the depositor, as the
case may be. Unless otherwise specified in the prospectus supplement, this
purchase obligation constitutes the sole remedy available to the securityholders
or the trustee for omission of, or a material defect in, any document.

     Notwithstanding the foregoing provisions, with respect to a trust fund for
which a REMIC or a FASIT election is to be made, unless the prospectus
supplement otherwise provides, no purchase of a Mortgage Loan will be made if
the purchase would result in a prohibited transaction under the Code.

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

     Assignment of Manufactured Home Loans

     The depositor will cause any Manufactured Home Loans included in the
Primary Assets for a series of Securities to be assigned to the trustee,
together with principal and interest due on or with respect to the Manufactured
Home Loans after the Cut-off Date specified in the prospectus supplement. Each
Manufactured Home Loan will be identified in a loan schedule (the "Manufactured
Home Loan Schedule") appearing as an exhibit to the related Agreement. The
Manufactured Home Loan Schedule will specify, with respect to each Manufactured
Home Loan, among other things: the original principal balance and the
outstanding principal balance as of the close of business on the Cut-off Date;
the interest rate; the current Scheduled Payment of principal and interest; and
the maturity date of the Manufactured Home Loan.

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

     Assignment of Participation Certificates

     The depositor will cause any certificates evidencing a participation
interest in a Loan or a pool of loans ("Participation Certificates") obtained
under a participation agreement to be assigned to the trustee by delivering to
the trustee the Participation Certificates, which will be reregistered in the
name of the trustee. Unless otherwise specified in the prospectus supplement,
the trustee will not be in possession of or be assignee of record with respect
to the Loans represented by any Participation Certificate. Each Participation
Certificate will be identified in a "Participation Certificate Schedule" which
will specify the original principal balance, outstanding principal balance as of
the Cut-off Date, pass-through rate and maturity date for each Participation
Certificate. In the related Agreement, the depositor will represent and warrant
to the trustee regarding each Participation Certificate:

     o  that the information contained in the Participation Certificate Schedule
        is true and correct in all material respects;


                                       60


     o  that, immediately prior to the conveyance of the Participation
        Certificates, the depositor had good title to and was sole owner of the
        Participation Certificates;

     o  that there has been no other sale by it of the Participation
        Certificates; and

     o  that the Participation Certificates are not subject to any existing
        lien, charge, security interest or other encumbrance (other than any
        Retained Interests).

REPURCHASE AND SUBSTITUTION OF NON-CONFORMING LOANS

     Unless otherwise provided in the prospectus supplement, if any document in
the Loan file delivered by the depositor to the trustee is found by the trustee
within 45 days of the execution of the related Agreement, or any other time
period specified in the prospectus supplement for the related series, (or
promptly after the trustee's receipt of any document permitted to be delivered
after the closing date of the issuance of the series) to be defective in any
material respect and the depositor does not cure the defect within 90 days, or
any other period specified in the prospectus supplement, the depositor will, not
later than 90 days, or any other period specified in the prospectus supplement,
after the trustee's notice to the depositor or the master servicer, as the case
may be, of the defect, repurchase the related Mortgage Loan or any property
acquired in respect thereof from the trustee.

     Unless otherwise specified in the prospectus supplement, the repurchase
price will be generally equal to (a) the lesser of (1) the outstanding principal
balance of the Mortgage Loan (or, in the case of a foreclosed Mortgage Loan, the
outstanding principal balance of the Mortgage Loan immediately prior to
foreclosure) and (2) the trust fund's federal income tax basis in the Mortgage
Loan, and (b) accrued and unpaid interest to the date of the next scheduled
payment on the Mortgage Loan at the related Interest Rate (less any unreimbursed
Advances respecting the Mortgage Loan), provided, however, the purchase price
will not be limited in (1) above to the trust fund's federal income tax basis if
the repurchase at a price equal to the outstanding principal balance of the
Mortgage Loan will not result in any prohibited transaction tax under Section
860F(a) of the Code.

     If provided in the prospectus supplement, the depositor may, rather than
repurchase the Loan as described above, remove the Loan from the trust fund (the
"Deleted Loan") and substitute in its place one or more other Loans (each, a
"Qualifying Substitute Mortgage Loan") provided, however, that (1) with respect
to a trust fund for which no REMIC election is made, the substitution must be
effected within 120 days of the date of initial issuance of the Securities and
(2) with respect to a trust fund for which a REMIC election is made, the
substitution must be made within two years of the date.

     Any Qualifying Substitute Mortgage Loan will have, on the date of
substitution, the characteristics specified in the applicable Agreement,
generally including (1) an outstanding principal balance, after deduction of all
Scheduled Payments due in the month of substitution, not in excess of the
outstanding principal balance of the Deleted Loan (the amount of any shortfall
to be deposited to the Distribution Account in the month of substitution for
distribution to securityholders), (2) an interest rate not less than (and not
more than 2% greater than) the interest rate of the Deleted Loan, (3) a
remaining term-to-stated maturity not greater than (and not more than two years
less than) that of the Deleted Loan, and will comply with all of the
representations and warranties set forth in the applicable agreement as of the
date of substitution.

     Unless otherwise provided in the prospectus supplement, the above-described
cure, repurchase or substitution obligations constitute the sole remedies
available to the securityholders or the trustee for a material defect in a Loan
document.

     The depositor or another entity will make representations and warranties
with respect to Loans that comprise the Primary Assets for a series. See "Loan
Underwriting Procedures and Standards -- Representations and Warranties" above.
If the depositor or such entity cannot cure a breach of any representations and
warranties in all material respects within 90 days after notification by the
trustee of the breach, and if the breach is of a nature that materially and
adversely affects the value of the Loan, the depositor or such entity is
obligated to repurchase the affected Loan or, if provided in the prospectus
supplement, provide a Qualifying Substitute Mortgage Loan therefor, subject to
the same


                                       61


conditions and limitations on purchases and substitutions as described above.
The depositor's only source of funds to effect any cure, repurchase or
substitution will be through the enforcement of the corresponding obligations of
the responsible originator or seller of the Loans.

REPORTS TO SECURITYHOLDERS

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

          (1) with respect to a series (a) other than a Multi-Class Series, the
     amount of the distribution allocable to principal on the Primary Assets,
     separately identifying the aggregate amount of any principal prepayments
     included therein and the amount, if any, advanced by the master servicer or
     by a servicer or (b) that is a Multi-Class Series, the amount of the
     principal distribution in reduction of stated principal amount (or Compound
     Value) of each class and the aggregate unpaid principal amount (or Compound
     Value) of each class following the distribution;

          (2) with respect to a series (a) other than a Multi-Class Series, the
     amount of the distribution allocable to interest on the Primary Assets and
     the amount, if any, advanced by the master servicer or a servicer or (b)
     that is not a Multi-Class Series, the amount of the interest distribution;

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

          (4) the aggregate outstanding principal balance of the Principal
     Assets as of the opening of business on the Due Date, after giving effect
     to distributions allocated to principal and reported under (1) above;

          (5) the aggregate outstanding principal amount of the Securities of
     the related series as of the Due Date, after giving effect to distributions
     allocated to principal reported under (1) above;

          (6) with respect to Compound Interest Securities, prior to the Accrual
     Termination Date in addition to the information specified in (1)(b) above,
     the amount of interest accrued on the Securities during the related
     interest accrual period and added to the Compound Value thereof;

          (7) in the case of Floating Rate Securities, the Floating Rate
     applicable to the distribution being made;

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

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

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

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

          (12) any other information as specified in the related Agreement.

     In addition, within a reasonable period of time after the end of each
calendar year the trustee, unless otherwise specified in the prospectus
supplement, will furnish to each securityholder of record at any time during
the calendar year: (a) the aggregate of amounts reported pursuant to (1)
through


                                       62


(4), (6) and (8) above for the calendar year and (b) the information specified
in the related Agreement to enable securityholders to prepare their tax returns
including, without limitation, the amount of original issue discount accrued on
the Securities, if applicable. Information in the Distribution Date and annual
reports provided to the securityholders will not have been examined and reported
upon by an independent public accountant. However, the master servicer will
provide to the trustee a report by independent public accountants with respect
to the master servicer's servicing of the Loans. See "Servicing of Loans --
Evidence as to Compliance."

INVESTMENT OF FUNDS

     The Distribution Account, Collection Account or Custodial Account, if any,
and any other funds and accounts for a series that may be invested by the
trustee or by the master servicer (or by the servicer, if any), can be invested
only in "Eligible Investments" acceptable to each Rating Agency, which may
include, without limitation:

     o  direct obligations of, and obligations fully guaranteed as to timely
        payment of principal and interest by, the United States of America,
        Freddie Mac, Fannie Mae or any agency or instrumentality of the United
        States of America, the obligations of which are backed by the full faith
        and credit of the United States of America;

     o  demand and time deposits, certificates of deposit or bankers'
        acceptances;

     o  repurchase obligations pursuant to a written agreement with respect to
        any security described in the first clause above;

     o  securities bearing interest or sold at a discount issued by any
        corporation incorporated under the laws of the United States of America
        or any state;

     o  commercial paper (including both non-interest-bearing discount
        obligations and interest-bearing obligations payable on demand or on a
        specified date not more than one year after the date of issuance
        thereof);

     o  a guaranteed investment contract issued by an entity having a credit
        rating acceptable to each Rating Agency; and

     o  any other demand, money market or time deposit or obligation, security
        or investment as would not adversely affect the then current rating by
        the Rating Agencies.

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

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

     If so provided in the prospectus supplement, the reinvestment income from
the Subordination Reserve Fund, other Reserve Fund, Servicing Account,
Collection Account or the Distribution Account may be property of the master
servicer or a servicer and not available for distributions to securityholders.
See "Servicing of Loans."

EVENT OF DEFAULT; RIGHTS UPON EVENT OF DEFAULT

     Trust Agreement

     As specified in the prospectus supplement, events of default under the
trust agreement for a series of Certificates include:

     o  any failure by the master servicer or servicer to distribute or remit
        any required payment that continues unremedied for five business days
        (or any shorter period as is specified in the


                                       63


        applicable agreement) after the giving of written notice of the failure
        to the master servicer or servicer by the trustee for the related
        series, or to the master servicer or servicer and the trustee by the
        holders of Certificates of the series evidencing not less than a
        specified percentage of the aggregate outstanding principal amount of
        the Certificates for the series;

     o  any failure by the master servicer or servicer duly to observe or
        perform in any material respect any other of its covenants or agreements
        in the trust agreement that continues unremedied for a specified number
        of days after the giving of written notice of the failure to the master
        servicer or servicer by the trustee, or to the master servicer or
        servicer and the trustee by the holders of Certificates of the related
        series evidencing not less than 25% of the aggregate outstanding
        principal amount of the Certificates; and

     o  certain events in insolvency, readjustment of debt, marshalling of
        assets and liabilities or similar proceedings and certain actions by the
        master servicer or servicer indicating its insolvency, reorganization or
        inability to pay its obligations.

     So long as an Event of Default remains unremedied under the trust agreement
for a series, the trustee for the related series or holders of Certificates of
the series evidencing not less than a specified percentage of the aggregate
outstanding principal amount of the Certificates for the series may terminate
all of the rights and obligations of the master servicer as servicer under the
trust agreement and in and to the Mortgage Loans (other than its right to
recovery of other expenses and amounts advanced pursuant to the terms of the
trust agreement which rights the master servicer will retain under all
circumstances), whereupon the trustee will succeed to all the responsibilities,
duties and liabilities of the master servicer under the trust agreement and will
be entitled to reasonable servicing compensation not to exceed the applicable
servicing fee, together with other servicing compensation in the form of
assumption fees, late payment charges or otherwise as provided in the trust
agreement.

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

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

     No holder of a series of Certificates, solely by virtue of that holder's
status as a Certificateholder, will have any right under the trust agreement for
the related series to institute any proceeding with respect to the trust
agreement, unless that holder previously has given to the trustee for that
series written notice of default and unless the holders of Certificates
evidencing not less than a specified percentage of the aggregate outstanding
principal amount of the Certificates for that series have made written request
upon the trustee to institute a proceeding in its own name as trustee thereunder
and have offered to the trustee reasonable indemnity, and the trustee for a
specified number of days has neglected or refused to institute such a
proceeding.


                                       64


     Indenture

     As specified in the prospectus supplement, events of default under the
indenture for each series of Notes generally include:

     o  a default for a specified number of days in the payment of any interest
        or installment of principal on a Note of that series, to the extent
        specified in the prospectus supplement, or the default in the payment of
        the principal of any Note at the Note's maturity;

     o  failure to perform in any material respect any other covenant of the
        trust in the indenture that continues for a specified number of days
        after notice is given in accordance with the procedures described in the
        prospectus supplement;

     o  any failure to observe or perform any covenant or agreement of the
        trust, or any representation or warranty made by the trust in the
        indenture or in any certificate or other writing delivered pursuant or
        in connection with the series having been incorrect in a material
        respect as of the time made, and that breach is not cured within a
        specified number of days after notice is given in accordance with the
        procedures described in the prospectus supplement;

     o  certain events of bankruptcy, insolvency, receivership or liquidation of
        the trust; or

     o  any other event of default provided with respect to Notes of that
        series.

     If an event of default with respect to the Notes of any series at the time
outstanding occurs and is continuing, subject to the terms of the indenture,
either the trustee or the holders of a specified percentage of the then
aggregate outstanding amount of the Notes of the series may declare the
principal amount or, if the Notes of that series are zero coupon securities,
that portion of the principal amount as may be specified in the terms of that
series, of all the Notes of the series to be due and payable immediately. That
declaration may, under certain circumstances, be rescinded and annulled by the
holders of a specified percentage in aggregate outstanding amount of the Notes
of that series.

     If, following an event of default with respect to any series of Notes, the
Notes of that series have been declared to be due and payable, the trustee may,
in its discretion, notwithstanding any acceleration, elect to maintain
possession of the collateral securing the Notes of the series and to continue
to apply distributions on the collateral as if there had been no declaration of
acceleration if the collateral continues to provide sufficient funds for the
payment of principal and interest on the Notes of that series as they would
have become due if there had not been a declaration of acceleration. In
addition, the trustee may not sell or otherwise liquidate the collateral
securing the Notes of a series following an event of default, unless:

     o  the holders of 100% (or any other percentages specified in the
        indenture) of the then aggregate outstanding amount of the Notes (or
        certain classes of Notes) of the series consent to the sale;

     o  the proceeds of the sale or liquidation are sufficient to pay in full
        the principal and accrued interest, due and unpaid, on the outstanding
        Notes of the series at the date of the sale; or

     o  the trustee determines that the collateral would not be sufficient on an
        ongoing basis to make all payments on the Notes as the payments would
        have become due if the Notes had not been declared due and payable, and
        the trustee obtains the consent of the holders of a specified percentage
        of the then aggregate outstanding amount of the Notes of the series.

     As specified in the prospectus supplement, in the event the principal of
the Notes of a series is declared due and payable, the holders of any Notes
issued at a discount from par may be entitled to receive no more than an amount
equal to the unpaid principal amount less the amount of the discount that is
unamortized.

     Subject to the provisions for indemnification and certain limitations
contained in the indenture, the holders of a specified percentage of the then
aggregate outstanding amount of the Notes of a series will 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


                                       65


to the Notes of the series, and the holders of a specified percentage of the
then aggregate outstanding amount of the Notes of that series may, in certain
cases, waive any default, 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 that series affected thereby.

THE TRUSTEE

     The identity of the commercial bank, savings and loan association or trust
company named as the trustee for each series of Securities will be set forth in
the prospectus supplement. The entity serving as trustee may have normal banking
relationships with the depositor or the master servicer. In addition, for the
purpose of meeting the legal requirements of certain local jurisdictions, the
trustee will have the power to appoint co-trustees or separate trustees of all
or any part of the trust fund relating to a series of Securities. In the event
of such appointment, all rights, powers, duties and obligations conferred or
imposed upon the trustee by the Agreement relating to that series will be
conferred or imposed upon the trustee and each separate trustee or co-trustee
jointly, or, in any jurisdiction in which the trustee is incompetent or
unqualified to perform certain acts, singly upon the separate trustee or
co-trustee who will exercise and perform those rights, powers, duties and
obligations solely at the direction of the trustee. The trustee may also appoint
agents to perform any of the responsibilities of the trustee, which agents will
have any or all of the rights, powers, duties and obligations of the trustee
conferred on them by their appointment; provided that the trustee will continue
to be responsible for its duties and obligations under the Agreement.

DUTIES OF THE TRUSTEE

     The trustee makes no representations as to the validity or sufficiency of
the Agreements, the Securities or of any Primary Asset or related documents. If
no event of default (as defined in the related Agreement) has occurred, the
trustee is required to perform only those duties specifically required of it
under the Agreement. Upon receipt of the various certificates, statements,
reports or other instruments required to be furnished to it, the trustee is
required to examine them to determine whether they are in the form required by
the related Agreement, however, the trustee will not be responsible for the
accuracy or content of any documents furnished by it or the securityholders to
the master servicer under the related Agreement.

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

RESIGNATION OF TRUSTEE

     The trustee may, upon written notice to the depositor, resign at any time,
in which event the depositor will be obligated to use its best efforts to
appoint a successor trustee. If no successor trustee has been appointed and has
accepted the appointment within a specified number of days after giving notice
of resignation, the resigning trustee or the securityholders may petition any
court of competent jurisdiction for appointment of a successor trustee.

     The trustee may also be removed at any time:

     o  if the trustee ceases to be eligible to continue to act as trustee under
        the Agreement;

     o  if the trustee becomes insolvent; or

     o  by the securityholders of securities evidencing a specified percentage
        of the aggregate voting rights of the securities in the trust fund upon
        written notice to the trustee and to the depositor.


                                       66


     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.

DISTRIBUTION ACCOUNT

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

     Unless otherwise specified in the prospectus supplement, "Business Day"
means a day that, in the city of New York or in the city or cities in which the
corporate trust office of the trustee are located, is neither a legal holiday
nor a day on which banking institutions are authorized or obligated by law,
regulation or executive order to be closed.

EXPENSE RESERVE FUND

     If specified in the prospectus supplement relating to a series, the
depositor may deposit on the related closing date of the issuance of a series in
an account to be established with the trustee (the "Expense Reserve Fund") cash
or eligible investments that will be available to pay anticipated fees and
expenses of the trustee or other agents. The Expense Reserve Fund for a series
may also be funded over time through the deposit therein of all or a portion of
cash flow, to the extent described in the prospectus supplement. The Expense
Reserve Fund, if any, will not be part of the trust fund held for the benefit of
the holders. Amounts on deposit in any Expense Reserve Fund will be invested in
one or more Eligible Investments.

AMENDMENT OF AGREEMENT

     Unless otherwise specified in the prospectus supplement, the Agreement for
each series of Securities may be amended by the parties to the Agreement,
without notice to or consent of the securityholders:

          (1) to cure any ambiguity;

          (2) to conform to the provisions of the prospectus supplement and
     prospectus, to correct any defective provisions or to supplement any
     provision;

          (3) to add any other provisions with respect to matters or questions
     arising under the Agreement; or

          (4) to comply with any requirements imposed by the Code;

provided that any amendment except pursuant to clause (3) above, will not
adversely affect in any material respect the interests of any securityholders
of the related series not consenting thereto. If provided in the Agreement, any
amendment pursuant to clause (3) of the preceding sentence will be deemed not
to adversely affect in any material respect the interests of any securityholder
if the trustee receives written confirmation from each Rating Agency rating the
Securities of that series that the amendment will not cause the Rating Agency
to reduce the then current rating.


                                       67


     As specified in the prospectus supplement, the Agreement may also be
amended by the parties to the Agreement with the consent of the securityholders
possessing a specified percentage of the aggregate outstanding principal amount
of the Securities (or, if only certain classes are affected by the amendment, a
specified percentage of the aggregate outstanding principal amount of each
class affected), for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Agreement or modifying in
any manner the rights of securityholders; provided, however, that no amendment
may:

     o  reduce the amount or delay the timing of payments on any Security
        without the consent of the holder of that Security; or

     o  reduce the percentage required to consent to the amendment, without the
        consent of securityholders of 100% of each class of Securities affected
        by the amendment.

VOTING RIGHTS

     The prospectus supplement may set forth a method of determining allocation
of voting rights with respect to a series of Securities.

REMIC OR FASIT ADMINISTRATOR

     For any Multi-Class Series with respect to which a REMIC or FASIT election
is made, preparation of certain reports and certain other administrative duties
with respect to the trust fund may be performed by a REMIC or a FASIT
administrator, who may be an affiliate of the depositor.

ADMINISTRATION AGREEMENT

     If specified in the prospectus supplement for a series of Notes, the
depositor, the trust fund and an administrator specified in the prospectus
supplement will enter into an administration agreement. The administrator will
agree, to the extent provided in the administration agreement, to provide
certain notices and to perform certain other administrative obligations required
to be performed by the trust fund under the sale and collection agreement, the
indenture and the deposit trust agreement. Certain additional administrative
functions may be performed on behalf of the trust fund by the depositor.

PERIODIC REPORTS

     The Agreement for each series of Securities will provide that the entity or
entities identified in the Agreement will prepare and file certain periodic
reports with the Commission and, to the extent required by law, file
certifications as to the accuracy of such reports and as to other matters.

     To the extent provided in the Agreement for a series of Securities, the
entities or persons identified in the Agreement will be indemnified by the trust
for certain liabilities associated with any such certification not resulting
from their own negligence.

TERMINATION

     Trust Agreement

     The obligations created by the trust agreement for a series will terminate
upon the distribution to securityholders of all amounts distributable to them
pursuant to the trust agreement after the earlier of:

     o  the later of (a) the final payment or other liquidation of the last
        Mortgage Loan remaining in the trust fund for the related series and (b)
        the disposition of all property acquired upon foreclosure or deed in
        lieu of foreclosure in respect of any Mortgage Loan ("REO Property");
        and

     o  the repurchase, as described below, by the master servicer from the
        trustee for the related series of all Mortgage Loans at that time
        subject to the trust agreement and all REO Property.


                                       68


     As specified in the prospectus supplement, the trust agreement for each
series permits, but does not require, the specified entity to repurchase from
the trust fund for that series all remaining Mortgage Loans at a price equal,
unless otherwise specified in the prospectus supplement, to:

     o  100% of the Aggregate Asset Principal Balance of the Mortgage Loans,
        plus

     o  with respect to REO Property, if any, the outstanding principal balance
        of the related Mortgage Loan, minus

     o  related unreimbursed Advances, or in the case of the Mortgage Loans,
        only to the extent not already reflected in the computation of the
        Aggregate Asset Principal Balance of the Mortgage Loans, minus

     o  unreimbursed expenses that are reimbursable pursuant to the terms of the
        trust agreement, plus

     o  accrued interest at the weighted average Mortgage Rate through the last
        day of the Due Period in which the repurchase occurs;

provided, however, that if an election is made for treatment as a REMIC or as a
FASIT under the Code, the repurchase price may equal the greater of:

     o  100% of the Aggregate Asset Principal Balance of the Mortgage Loans,
        plus accrued interest thereon at the applicable Net Mortgage Rates
        through the last day of the month of the repurchase; and

     o  the aggregate fair market value of the Mortgage Loans; plus the fair
        market value of any property acquired in respect of a Mortgage Loan and
        remaining in the trust fund.

     The exercise of this right will effect early retirement of the
Certificates of the series, but the master servicer's right to so purchase is
subject to the Aggregate Principal Balance of the Mortgage Loans at the time of
repurchase being less than a fixed percentage, to be set forth in the
prospectus supplement, of the aggregate asset principal balance on the Cut-off
Date. In no event, however, will the trust created by the Agreement continue
beyond the expiration of 21 years from the death of the last survivor of a
certain person identified therein. For each series, the master servicer or the
trustee, as applicable, will give written notice of termination of the
Agreement to each securityholder, and the final distribution will be made only
upon surrender and cancellation of the Certificates at an office or agency
specified in the notice of termination. If so provided in the prospectus
supplement for a series, the depositor or another entity may effect an optional
termination of the trust fund under the circumstances described in the
prospectus supplement. See "Description of the Securities -- Optional
Termination."

     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 or, with certain
limitations, upon deposit with the trustee of funds sufficient for the payment
in full of all of the Notes.

     In addition, with certain limitations, the indenture may provide that the
trust will be discharged from any and all obligations in respect of the Notes,
except for certain administrative duties, upon the deposit with the trustee of
money or direct obligations of or obligations guaranteed by the United States of
America which through the payment of interest and principal in accordance with
their terms will provide funds in an amount sufficient to pay the principal of
and each installment of interest on the Notes on the stated maturity date and
any installment of interest on the Notes in accordance with the terms of the
indenture and the Notes. In the event of any defeasance and discharge of Notes,
holders of the Notes will be able to look only to the funds or direct
obligations for payment of principal and interest, if any, on their Notes until
maturity.


                                       69


                            LEGAL ASPECTS OF LOANS

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

MORTGAGES

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

JUNIOR MORTGAGES; RIGHTS OF SENIOR MORTGAGES

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

     The standard form of the mortgage or deed of trust used by many
institutional lenders confers on the mortgagee or beneficiary the right both to
receive all proceeds collected under any hazard insurance policy and all awards
made in connection with any condemnation proceedings, and to apply the proceeds
and awards to any indebtedness secured by the mortgage or deed of trust, in the
order as the mortgagee or beneficiary may determine. Thus, in the event
improvements on the property are


                                       70


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

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

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

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


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COOPERATIVE LOANS

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

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

     A corporation that is entitled to be treated as a housing cooperative under
the Code owns all the real property or some interest therein sufficient to
permit it to own the building and all separate dwelling units therein. The
Cooperative is directly responsible for property management and, in most cases,
payment of real estate taxes and hazard and liability insurance. If there is a
blanket mortgage or mortgages on the cooperative apartment building and/or
underlying land, as is generally the case, or an underlying lease of the land,
as is the case in some instances, the Cooperative, as property mortgagor, is
also responsible for meeting these mortgage and rental obligations. The interest
of the occupant under proprietary leases or occupancy agreements as to which
that Cooperative is the landlord are generally subordinate to the interest of
the holder of a blanket mortgage and to the interest of the holder of a land
lease.

     If the Cooperative is unable to meet the payment obligations (1) arising
under a blanket mortgage, the mortgagee holding a blanket mortgage could
foreclose on that mortgage and terminate all subordinate proprietary leases and
occupancy agreements or (2) arising under its land lease, the holder of the land
lease could terminate it and all subordinate proprietary leases and occupancy
agreements. Also, a blanket mortgage on a Cooperative may provide financing in
the form of a mortgage that does not fully amortize, with a significant portion
of principal being due in one final payment at maturity. The inability of the
Cooperative to refinance a mortgage and its consequent inability to make final
payment could lead to foreclosure by the mortgagee. Similarly, a land lease has
an expiration date and the inability of the Cooperative to extend its term or,
in the alternative, to purchase the land could lead to termination of the
Cooperative's interest in the property and termination of all proprietary leases
and occupancy agreements. A foreclosure by the holder of a blanket mortgage
could eliminate or significantly diminish the value of any collateral held by
the lender who financed an individual tenant-stockholder of Cooperative shares
or, in the case of the Mortgage Loans, the collateral securing the Cooperative
Loans. Similarly, the termination of the land lease by its holder could
eliminate or significantly diminish the value of any collateral held by the
lender who financed an individual tenant-stockholder of the Cooperative shares
or, in the case of the Mortgage Loans, the collateral securing the Cooperative
Loans.

     The Cooperative is owned by tenant-stockholders who, through ownership of
stock or shares in the corporation, receive proprietary leases or occupancy
agreements that confer exclusive rights to occupy specific units. Generally, a
tenant-stockholder of a Cooperative must make a monthly payment


                                       72


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

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

     Tax Aspects of Cooperative Ownership

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

FORECLOSURE ON MORTGAGES

     Foreclosure of a deed of trust is generally accomplished by a non-judicial
trustee's sale under a specific provision in the deed of trust that authorizes
the trustee to sell the property upon any default by the borrower under the
terms of the note or deed of trust. In some states, the trustee must record


                                       73


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

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

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

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

REALIZING UPON COOPERATIVE LOAN SECURITY

     The Cooperative shares and proprietary lease or occupancy agreement owned
by the tenant-stockholder and pledged to the lender are, in almost all cases,
subject to restrictions on transfer as set forth in the Cooperative's
certificate of incorporation and by-laws, as well as in the proprietary lease or
occupancy agreement. The proprietary lease or occupancy agreement, even while
pledged,


                                       74


may be cancelled by the Cooperative for failure by the tenant-stockholder to pay
rent or other obligations or charges owed by the tenant-stockholder, including
mechanics' liens against the Cooperative apartment building incurred by the
tenant-stockholder. Commonly, rent and other obligations and charges arising
under a proprietary lease or occupancy agreement that are owed to the
Cooperative are made liens upon the shares to which the proprietary lease or
occupancy agreement relates. In addition, the proprietary lease or occupancy
agreement generally permits the Cooperative to terminate the lease or agreement
in the event the borrower defaults in the performance of covenants thereunder.
Typically, the lender and the Cooperative enter into a recognition agreement
that establishes the rights and obligations of both parties in the event of a
default by the tenant-stockholder on its obligations under the proprietary lease
or occupancy agreement. A default by the tenant-stockholder under the
proprietary lease or occupancy agreement will usually constitute a default under
the security agreement between the lender and the tenant-stockholder.

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

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

     In some states, foreclosure on the cooperative shares is accomplished by a
sale in accordance with the provisions of Article 9 of the Uniform Commercial
Code (the "UCC") and the security agreement relating to those shares. Article 9
of the UCC requires that a sale be conducted in a "commercially reasonable"
manner. Whether a foreclosure sale has been conducted in a "commercially
reasonable" manner will depend on the facts in each case. In determining
commercial reasonableness, a court will look to the notice given the debtor and
the method, manner, time, place and terms of the sale. Generally, a sale
conducted according to the usual practice of banks selling similar collateral
will be considered reasonably conducted.

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

     In the case of foreclosure on a mortgage secured by the cooperative
building itself, where the building was converted from a rental building to a
building owned by a cooperative, under a non-eviction plan, some states require
that a purchaser at a foreclosure sale take the property subject to rent control
and rent stabilization laws that apply to certain tenants who elect to remain in
the building but who did not purchase shares in the cooperative when the
building was so converted. In addition, all cooperative units that were
previously rent controlled or rent stabilized may convert to their prior state
of rent-controlled or rent-stabilized apartments.


                                       75


RIGHTS OF REDEMPTION

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

ANTI-DEFICIENCY LEGISLATION AND OTHER LIMITATIONS ON LENDERS

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

     In addition to the statutory prohibitions on deficiency judgments, certain
Mortgage Loans in the trust fund may, by their terms, prohibit recourse to the
borrower in the event proceeds from foreclosure or other liquidation are
insufficient to satisfy the debt. These Mortgage Loans may also not require
payments of principal and interest until maturity, thereby increasing the
likelihood that a deficiency will exist.

     Cooperative Loans

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

     Leases and Rents

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

     Federal Bankruptcy and Other Laws Affecting Creditors' Rights

     In addition to laws limiting or prohibiting deficiency judgments, numerous
other statutory provisions, including the federal bankruptcy laws, the
Servicemembers Civil Relief Act, and state laws affording relief to debtors, may
interfere with or affect the ability of the secured lender to realize


                                       76


upon collateral and/or enforce a deficiency judgment. For example, with respect
to federal bankruptcy law, the filing of a petition acts as a stay against the
enforcement of remedies for collection of a debt. Thus, the Bankruptcy Code
will delay or interfere with the enforcement of the secured lender's rights in
respect of a defaulted loan. Moreover, a court with federal bankruptcy
jurisdiction may permit a debtor through a Chapter 13 rehabilitative plan under
the Bankruptcy Code to cure a monetary default with respect to a loan on a
debtor's residence by paying arrearages within a reasonable time period and
reinstating the original loan payment schedule even though the lender
accelerated the loan and the lender has taken all steps to realize upon his
security (provided no sale of the property has yet occurred) prior to the
filing of the debtor's Chapter 13 petition. Some courts with federal bankruptcy
jurisdiction have approved plans, based on the particular facts of the
reorganization case, that effected the curing of a loan default by permitting
the obligor to pay arrearages over a number of years.

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

     In a case under the Bankruptcy Code, the lender is precluded from
foreclosing its security interest without authorization from the bankruptcy
court. The lender's lien will be limited in amount to the value of the lender's
interest in the collateral as of the date of the bankruptcy, and the trustee in
bankruptcy (including the debtor in possession) can recover from the collateral
at the expense of the secured lender the costs or expenses of preserving or
disposing of such collateral to the extent of any benefit to the secured lender.
The secured creditor is entitled to the value of its security plus post-petition
interest, attorney's fees and costs only to the extent the value of the security
exceeds the debt. However, if the value of the collateral is less than the debt,
then the lender does not receive post-petition interest, attorney's fees or
costs. Further, in a Chapter 11 case under the Bankruptcy Code, the loan term
may be extended, the interest rate may be adjusted to market rates, the lien may
be transferred to other collateral, and the priority of the loan may be
subordinated to bankruptcy court-approved financing. The bankruptcy court can,
in effect, invalidate due-on-sale clauses through confirmed Chapter 11 plans of
reorganization.

     In addition, substantive requirements are imposed upon lenders in
connection with the origination and the servicing of mortgage loans by numerous
federal and some state consumer protection laws. The laws include the federal
Truth-in-Lending Act, Real Estate Settlement Procedures Act, Equal Credit
Opportunity Act, Fair Credit Billing Act, Fair Credit Reporting Act, Home
Ownership and Equity Protection Act of 1994 and related statutes and
regulations. These federal and state laws impose specific statutory liabilities
upon lenders who originate loans and who fail to comply with the provisions of
the law. In some cases, this liability may affect assignees of the loans.


     Federal Bankruptcy Laws Relating to Mortgage Loans Secured by Multifamily
Property

     Section 365(a) of the Bankruptcy Code generally provides that a trustee or
a debtor-in-possession in a bankruptcy or reorganization case under the
Bankruptcy Code has the power to assume or to reject an executory contract or an
unexpired lease of the debtor, in each case subject to the approval of the
bankruptcy court administering the case. If the trustee or debtor-in- possession
rejects an executory contract or an unexpired lease, rejection generally
constitutes a breach of the executory contract or unexpired lease immediately
before the date of the filing of the petition. As a consequence, if the
mortgagor is the other party or parties to the executory contract or unexpired
lease, such as a lessor under a lease, the mortgagor would have only an
unsecured claim against the debtor for damages resulting from the breach, which
could adversely affect the security for the related Mortgage Loan. Moreover,
under Section 502(b)(6) of the Bankruptcy Code, the claim of a lessor for
damages from the termination of a lease of real property will be limited to the
sum of (1) the rent


                                       77


reserved by the lease, without acceleration, for the greater of one year or 15
percent, not to exceed three years, of the remaining term of the lease,
following the earlier of the date of the filing of the petition and the date on
which the lender repossessed, or the lessee surrendered, the leased property,
and (2) any unpaid rent due under the lease, without acceleration, on the
earlier of these dates.

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

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

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

SERVICEMEMBERS CIVIL RELIEF ACT

     Under the Servicemembers Civil Relief Act, members of all branches of the
military on active duty, including draftees and reservists in military service
called to active duty:

     o  are entitled to have interest rates reduced and capped at 6% per annum
        (and all interest in excess of 6% per annum forgiven), on obligations
        (including Mortgage Loans and Manufactured Home Loans) incurred prior to
        the commencement of military service for the duration of active duty
        status;

     o  may be entitled to a stay of proceedings on any kind of foreclosure or
        repossession action in the case of defaults on the obligations entered
        into prior to military service; and

     o  may have the maturity of the obligations incurred prior to military
        service extended, the payments lowered and the payment schedule
        readjusted for a period of time after the completion of active duty
        status.

     However, the benefits listed above are subject to challenge by creditors
and if, in the opinion of the court, the ability of a person to comply with the
obligations is not materially impaired by military service, the court may apply
equitable principles accordingly. If a borrower's obligation to repay amounts
otherwise due on a Mortgage Loan or Manufactured Home Loan included in a Trust
for a series is relieved pursuant to the Servicemembers Civil Relief Act,
neither the servicer, the master servicer nor the trustee will be required to
advance the amounts, and any loss in respect thereof may reduce the amounts
available to be paid to the holders of the securities of the related series.

     As specified in the prospectus supplement, any shortfalls in interest
collections on Mortgage Loans included in a Trust for a series resulting from
application of the Servicemembers Civil Relief


                                       78


Act will be allocated to each class of securities of the related series that is
entitled to receive interest in respect of the Mortgage Loans or Manufactured
Home Loans in proportion to the interest that each class of Securities would
have otherwise been entitled to receive in respect of such Mortgage Loans had
such interest shortfall not occurred.

     In addition to the Servicemembers Civil Relief Act, state laws such as the
California Military and Veterans Code, as amended, provide similar relief for
members of the military and neither the servicer, the master servicer nor the
trustee will be required to advance amounts for any reductions due to
application of such laws and any loss in respect thereof may reduce the amounts
available to be paid to the holders of the securities of the related series.

ENVIRONMENTAL RISKS

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

     Amendments to CERCLA enacted in 1996 have clarified the range of activities
in which a lender may engage without becoming subject to liability under CERCLA.
However, liability for costs associated with the investigation and cleanup of
environmental contamination may also be governed by state law, which may not
provide any specific protections to lenders, or, alternatively, may not impose
liability on lenders at all.

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

DUE-ON-SALE CLAUSES IN MORTGAGE LOANS

     Due-on-sale clauses permit the lender to accelerate the maturity of the
loan if the borrower sells or transfers, whether voluntarily or involuntarily,
all or part of the real property securing the loan without the lender's prior
written consent. The enforceability of these clauses has been the subject of
legislation or litigation in many states, and in some cases, typically involving
single family residential mortgage transactions, their enforceability has been
limited or denied. In any event, the Garn-St. Germain Depository Institutions
Act of 1982 (the "Garn-St. Germain Act") generally preempts state
constitutional, statutory and case law that prohibits the enforcement of
due-on-sale clauses and permits lenders to enforce these clauses in accordance
with their terms. As a result, due-on-sale


                                       79


clauses have become enforceable except in those states whose legislatures
exercised their authority 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 in all cases not later than October 15, 1982;
        and

     o  originated by lenders other than national banks, federal savings
        institutions and federal credit unions.

     Freddie Mac 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, on various terms and for varying periods, the prohibition on
enforcement of due-on-sale clauses with respect to certain categories of window
period loans. Also, the Garn-St. Germain Act does "encourage" lenders to permit
assumption of loans at the original rate of interest or at some other rate less
than the average of the original rate and the market rate.

     In addition, under federal bankruptcy law, due-on-sale clauses may not be
enforceable in bankruptcy proceedings and may, under certain circumstances, be
eliminated in any modified mortgage resulting from a bankruptcy proceeding.

ENFORCEABILITY OF PREPAYMENT AND LATE PAYMENT FEES

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

EQUITABLE LIMITATIONS ON REMEDIES

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

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


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APPLICABILITY OF USURY LAWS

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

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

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

ADJUSTABLE INTEREST RATE LOANS

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

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

MANUFACTURED HOME LOANS

     Security Interests in the Manufactured Homes

     Law governing perfection of a security interest in a Manufactured Home
varies from state to state. Security interests in Manufactured Homes may be
perfected either by notation of the secured


                                       81


party's lien on the certificate of title or by delivery of the required
documents and payment of a fee to the state motor vehicle authority, depending
on state law. In some nontitle states, perfection pursuant to the provisions of
the UCC is required. The lender or a servicer may effect a notation or delivery
of the required documents and fees, and obtain possession of the certificate of
title, as appropriate under the laws of the state in which any manufactured
home securing a Manufactured Home Loan is registered. In the event the notation
or delivery is not effected or the security interest is not filed in accordance
with the applicable law (for example, is filed under a motor vehicle title
statute rather than under the UCC, in a few states), a first priority security
interest in the Manufactured Home securing a Manufactured Home Loan may not be
obtained.

     As Manufactured Homes have become larger and often have been attached to
their sites without any apparent intention to move them, courts in many states
have held that Manufactured Homes, under certain circumstances, may become
subject to real estate title and recording laws. As a result, a security
interest in a Manufactured Home could be rendered subordinate to the interests
of other parties claiming an interest in the Manufactured Home under applicable
state real estate law. In order to perfect a security interest in a Manufactured
Home under real estate laws, the holder of the security interest must file
either a "fixture filing" under the provisions of the UCC or a real estate
mortgage under the real estate laws of the state where the home is located.
These filings must be made in the real estate records office of the county where
the home is located.

     Manufactured Home Loans typically contain provisions prohibiting the
borrower from permanently attaching the Manufactured Home to its site. So long
as the borrower does not violate this agreement, a security interest in the
Manufactured Home will be governed by the certificate of title laws or the UCC,
and the notation of the security interest on the certificate of title or the
filing of a UCC financing statement will be effective to maintain the priority
of the security interest in the Manufactured Home. If, however, a Manufactured
Home is permanently attached to its site, other parties could obtain an interest
in the Manufactured Home that is prior to the security interest originally
retained by the lender or its assignee. With respect to a series of Securities
evidencing interests in a trust fund that includes Manufactured Home Loans and
as described in the prospectus supplement, the depositor may be required to
perfect a security interest in the Manufactured Home under applicable real
estate laws. If the real estate filings are not made and if any of the foregoing
events were to occur, the only recourse of the securityholders would be against
the depositor pursuant to its repurchase obligation for breach of warranties. A
PMBS Agreement pursuant to which Private Mortgage-Backed Securities backed by
Manufactured Home Loans are issued will, unless otherwise specified in the
prospectus supplement, have substantially similar requirements for perfection of
a security interest.

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

     Relocation of a Manufactured Home

     In the event that the owner of a Manufactured Home moves the home to a
state other than the state in which the Manufactured Home initially is
registered, under the laws of most states the perfected security interest in the
Manufactured Home would continue for four months after relocation and thereafter
only if and after the owner reregisters the Manufactured Home in the state. If
the owner were to relocate a Manufactured Home to another state and not
reregister the Manufactured Home in the state, and if steps are not taken to
reperfect the trustee's security interest in the state, the security interest in
the Manufactured Home would cease to be perfected.

     A majority of states generally require surrender of a certificate of title
to reregister a Manufactured Home; accordingly, possession of the certificate of
title to the Manufactured Home must be surrendered or, in the case of
Manufactured Homes registered in states that provide for


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notation of lien, the notice of surrender must be given to any person whose
security interest in the Manufactured Home is noted on the certificate of
title. Accordingly, the owner of the Manufactured Home Loan would have the
opportunity to reperfect its security interest in the Manufactured Home in the
state of relocation. In states that do not require a certificate of title for
registration of a Manufactured Home, reregistration could defeat perfection.

     In the ordinary course of servicing the Manufactured Home Loans, the master
servicer will be required to take steps to effect reperfection upon receipt of
notice of reregistration or information from the borrower as to relocation.
Similarly, when a borrower under a Manufactured Home Loan sells the related
Manufactured Home, the trustee must surrender possession of the certificate of
title or the trustee will receive notice as a result of its lien noted thereon
and accordingly will have an opportunity to require satisfaction of the related
Manufactured Home Loan before release of the lien. Under the Agreements, the
depositor is obligated to take these steps, at the servicer's expense, as are
necessary to maintain perfection of security interests in the Manufactured
Homes. PMBS Agreements pursuant to which Private Mortgage-Backed Securities
backed by Manufactured Home Loans are issued will impose substantially similar
requirements.

     Intervening Liens

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

     Enforcement of Security Interests in Manufactured Homes

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

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

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

     Consumer Protection Laws

     The so-called "Holder-In-Due-Course" rule of the Federal Trade Commission
is intended to defeat the ability of the transferor of a consumer credit
contract who is the seller of goods that gave rise to the transaction (and
certain related lenders and assignees) to transfer the contract free of


                                       83


notice of claims by the borrower thereunder. The effect of this rule is to
subject the assignee of the contract to all claims and defenses that the
borrower could assert against the seller of goods. Liability under this rule is
limited to amounts paid under a Manufactured Home Loan; however, the borrower
also may be able to assert the rule to set off remaining amounts due as a
defense against a claim brought against the borrower. Numerous other federal
and state consumer protection laws impose requirements applicable to the
origination and lending pursuant to the Manufactured Home Loan, including the
Truth-in-Lending Act, the Federal Trade Commission Act, the Fair Credit Billing
Act, the Fair Credit Reporting Act, the Equal Credit Opportunity Act, the Fair
Debt Collection Practices Act and the Uniform Consumer Credit Code. In the case
of some of these laws, the failure to comply with their provisions may affect
the enforceability of the related Manufactured Home Loan.

     Transfers of Manufactured Homes; Enforceability of "Due-on-Sale" Clauses

     Loans and installment sale contracts relating to a Manufactured Home Loan
typically prohibit the sale or transfer of the related Manufactured Homes
without the consent of the lender and permit the acceleration of the maturity of
the Manufactured Home Loans by the lender upon any the sale or transfer for
which no the consent is granted.

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

     Applicability of Usury Laws

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


                  MATERIAL FEDERAL INCOME TAX CONSIDERATIONS

     The following is a general discussion of certain anticipated material
federal income tax consequences of the purchase, ownership and disposition of
the securities. This discussion has been prepared with the advice of McKee
Nelson LLP and Dechert LLP, each as special counsel to the depositor. This
discussion is based on authorities that are subject to change or differing
interpretations. Any such change or differing interpretation could be applied
retroactively. No rulings have been or will be sought from the IRS with respect
to any of the matters discussed below, and no assurance can be given that the
views of the IRS with respect to those matters will not differ from that
described below.

     This discussion is directed solely to Security Owners that purchase
securities at issuance and hold them as "capital assets" within the meaning of
Section 1221 of the Code. The discussion does not purport to cover all federal
income tax consequences applicable to particular investors, some of which may be
subject to special rules. Investors subject to such special rules include
dealers in securities, certain traders in securities, financial institutions,
tax-exempt organizations, insurance companies, persons who hold securities as
part of a hedging transaction or as a position in a straddle or conversion
transaction, persons whose functional currency is not the U.S. dollar, or
persons who elect to treat gain recognized on the disposition of a security as
investment income under Section 163(d)(4)(B)(iii) of the Code.

     In addition, this discussion does not address the state, local or other tax
consequences of the purchase, ownership, and disposition of securities. We
recommend that you consult your own tax


                                       84


advisor in determining the state, local and other tax consequences of the
purchase, ownership, and disposition of securities. Moreover, this discussion
may be supplemented by a discussion in the applicable prospectus supplement.

     In this discussion, when we use the term:

     o  "Security Owner," we mean any person holding a beneficial ownership
        interest in securities;

     o  "Code," we mean the Internal Revenue Code of 1986, as amended;

     o  "IRS," we mean the Internal Revenue Service;

     o  "AFR," we mean the applicable federal rate, which is an average of
        current yields for U.S. Treasury securities with specified ranges of
        maturities and which is computed and published monthly by the IRS for
        use in various tax calculations;

     o  "Foreign Person," we mean any person other than a U.S. Person; and

     o  "U.S. Person," we mean (i) a citizen or resident of the United States;
        (ii) a corporation (or entity treated as a corporation for tax purposes)
        created or organized in the United States or under the laws of the
        United States or of any state thereof, including, for this purpose, the
        District of Columbia; (iii) a partnership (or entity treated as a
        partnership for tax purposes) organized in the United States or under
        the laws of the United States or of any state thereof, including, for
        this purpose, the District of Columbia (unless provided otherwise by
        future Treasury regulations); (iv) an estate whose income is includible
        in gross income for United States income tax purposes regardless of its
        source; or (v) 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 U.S. Persons have authority to control all substantial
        decisions of the trust. Notwithstanding the preceding clause, to the
        extent provided in Treasury regulations, certain trusts that were in
        existence on August 20, 1996, that were treated as U.S. Persons prior to
        such date, and that elect to continue to be treated as U.S. Persons,
        also are U.S. Persons.

TYPES OF SECURITIES

     This discussion addresses the following four types of securities:

     o  REMIC certificates;

     o  FASIT certificates;

     o  notes issued by a trust, including a trust for which a REIT election has
        been made; and

     o  trust certificates issued by trusts for which a REMIC or FASIT election
        is not made.

     The prospectus supplement for each series of securities will indicate the
tax characterization of each security issued pursuant to that supplement. Set
forth below is a general description of each type of tax characterization, with
references to more detailed discussions regarding particular securities. The
discussions under "-- Special Tax Attributes" and "-- Backup Withholding" below
address all types of securities.

     REMIC Certificates Generally.

     With respect to each series of REMIC certificates, McKee Nelson LLP or
Dechert LLP ("Company Counsel") will deliver its opinion that, assuming
compliance with all provisions of the related trust agreement, the related trust
will comprise one or more "REMICs" within the meaning of Section 860D of the
Code and the classes of interests offered will be considered to be "regular
interests" or "residual interests" in a REMIC within the meaning set out in
Section 860G(a) of the Code. The prospectus supplement for REMIC certificates
will identify the regular interests and residual interest in the REMIC.

     A REMIC may issue one or more classes of regular interests and must issue
one and only one class of residual interest. We refer to a REMIC certificate
representing a regular interest in a REMIC as a "REMIC regular certificate."
REMIC regular certificates generally will be treated for federal


                                       85


income tax purposes as debt instruments issued by the REMIC. The tax treatment
of securities treated as debt instruments, including REMIC regular
certificates, is discussed under "-- Taxation of Securities Treated as Debt
Instruments" below. You should be aware, however, that although you normally
would take interest income on a debt instrument into account under your regular
method of accounting, you must include interest accrued on a REMIC regular
certificate in income under the accrual method of accounting regardless of the
method of accounting you otherwise use for tax purposes.

     We refer to a REMIC certificate representing a residual interest in a REMIC
as a "REMIC residual certificate" and the owner of a beneficial interest in a
REMIC residual certificate as a "Residual Owner." The tax treatment of REMIC
residual certificates is discussed under "-- REMIC Residual Certificates" below.

     A REMIC is subject to tax at a rate of 100 percent on the net income the
REMIC derives from prohibited transactions. In general, a "prohibited
transaction" means the disposition of a qualified mortgage other than pursuant
to certain specified exceptions, the receipt of income from a source other than
a qualified mortgage or certain other permitted investments, the receipt of
compensation for services, or gain from the disposition of an asset purchased
with the payments on the qualified mortgages for temporary investment pending
distribution on the REMIC certificates. The Code also imposes a 100 percent tax
on the value of any contribution of assets to the REMIC after the closing date
other than pursuant to specified exceptions, and subjects "net income from
foreclosure property" to tax at the highest corporate rate. We do not anticipate
that any REMIC in which we will offer certificates will engage in any such
transactions or receive any such income.

     If an entity elects to be treated as a REMIC but fails to comply with one
or more of the ongoing requirements of the Code for REMIC status during any
taxable year, the entity will not qualify as a REMIC for such year and
thereafter. In this event, the entity may be subject to taxation as a separate
corporation, and the certificates issued by the entity may not be accorded the
status described under "-- Special Tax Attributes" below. In the case of an
inadvertent termination of REMIC status, the Treasury Department has authority
to issue regulations providing relief; however, sanctions, such as the
imposition of a corporate tax on all or a portion of the entity's income for the
period during which the requirements for REMIC status are not satisfied, may
accompany any such relief.

     To the extent provided in the applicable prospectus supplement, a
certificate may represent not only the ownership of a REMIC regular interest but
also an interest in a notional principal contract. This can occur, for instance,
if the applicable trust agreement provides that the rate of interest payable by
the REMIC on the regular interest is subject to a cap based on the weighted
average of the net interest rates payable on the qualified mortgages held by the
REMIC. In these instances, the trust agreement may provide for a reserve fund
that will be held as part of the trust fund but not as an asset of any REMIC
created pursuant to the trust agreement (an "outside reserve fund"). The outside
reserve fund would typically be funded from monthly excess cashflow. If the
interest payments on a regular interest were limited due to the above-described
cap, payments of any interest shortfall due to application of that cap would be
made to the regular interest holder to the extent of funds on deposit in the
outside reserve fund. For federal income tax purposes, payments from the outside
reserve fund will be treated as payments under a notional principal contract
written by the owner of the outside reserve fund in favor of the regular
interest holders.

     FASIT Certificates Generally.

     With respect to each series of FASIT certificates, Company Counsel will
deliver its opinion that, assuming compliance with all provisions of the related
trust agreement, the related trust will qualify as a "FASIT" within the meaning
of Section 860L of the Code. In such case, the certificates will represent one
or more classes of FASIT regular interests, which we refer to herein as "FASIT
regular certificates," and a single ownership interest, which we refer to herein
as the "Ownership certificate." The prospectus supplement for FASIT certificates
will identify the regular interests and ownership interest in the FASIT.

     FASIT regular certificates generally will be treated as debt instruments
for federal income tax purposes, and a Security Owner must report income from
such certificates under an accrual method of


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accounting, even if it otherwise would have used another method. The tax
treatment of securities treated as debt instruments, including FASIT regular
certificates, is discussed under "-- Taxation of Securities Treated as Debt
Instruments" below.

     Certain FASIT regular interests, referred to as "High-Yield Interests," are
subject to special rules. The applicable prospectus supplement will identify
those FASIT regular certificates, if any, that are High-Yield Interests.
Generally, High-Yield Interests may be held only by domestic "C" corporations,
other FASITs, and dealers in securities who hold such interests in inventory. If
a securities dealer (other than a domestic "C" corporation) initially acquires a
High-Yield Interest as inventory, but later begins to hold it for investment or
ceases to be a dealer, the dealer will become subject to an excise tax equal to
the income from the High-Yield Interest multiplied by the highest corporate
income tax rate. In addition, the transfer of a High-Yield Interest to a
disqualified holder will be disregarded for federal income tax purposes, and the
transferor will continue to be taxed as the holder of the High-Yield Interest.

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

     The Ownership certificate in a FASIT must be held by an "eligible
corporation" within the meaning of Section 860L(a)(2) of the Code (generally, a
domestic, taxable "C" corporation other than a REIT, regulated investment
company or cooperative). The tax treatment of Ownership certificates is
discussed under "-- FASIT Ownership Certificates" below.

     Qualification as a FASIT requires ongoing compliance with certain
conditions. If a trust for which a FASIT election has been made fails to comply
with one or more of the Code's ongoing requirements for FASIT status during any
taxable year, the Code provides that its FASIT status may be lost for that year
and thereafter. If FASIT status is lost, the treatment of the former FASIT and
the interests therein for federal income tax purposes is uncertain. The former
FASIT might be treated as a trust, as a separate association taxable as a
corporation, or as a partnership. The FASIT regular certificates could be
treated as debt instruments for federal income tax purposes or as equity
interests in the former FASIT. Although the Code authorizes the Treasury to
issue regulations that address situations where a failure to meet the
requirements for FASIT status occurs inadvertently and in good faith, such
regulations have not yet been issued. It is possible that disqualification
relief might be accompanied by sanctions, such as the imposition of a corporate
tax on all or a portion of the FASIT's income for a period of time in which the
requirements for FASIT status are not satisfied.

     On February 7, 2000, the IRS released proposed regulations interpreting the
provisions of the Code applicable to FASITs. Subject to certain exceptions, the
proposed regulations would become effective at the time the regulations are
issued in final form. Accordingly, definitive guidance addressing the
qualification of a trust as a FASIT and the tax consequences to beneficial
owners of interests in FASITs does not exist.

     Issuance of Notes Generally.

     For each issuance of notes by a trust (which does not make a REMIC or FASIT
election), Company Counsel will deliver its opinion that, assuming compliance
with the trust agreement and the indenture, the notes will constitute debt
instruments for federal income tax purposes. No regulations, published rulings,
or judicial decisions may exist that discuss the characterization for federal
income tax purposes of securities with terms substantially the same as the
notes. The depositor and the trustee will agree, and the beneficial owners of
notes will agree by their purchase of the notes, to treat the notes as debt for
all tax purposes. The tax treatment of securities treated as debt instruments is
discussed under "-- Taxation of Securities Treated as Debt Instruments" below.
If, contrary to the opinion of Company Counsel, the IRS successfully asserted
that the notes were not debt instruments


                                       87


for federal income tax purposes, the notes might be treated as equity interests
in the trust, and the timing and amount of income allocable to beneficial
owners of those notes might be different than as described under "-- Taxation
of Securities Treated as Debt Instruments."

     With respect to certain trusts that issue notes, an election may be made to
treat the trust as a "real estate investment trust" within the meaning of
Section 856(a) of the Code (a "REIT"). In general, a REIT receives certain tax
benefits, provided the REIT complies with requirements relating to its assets,
its income and its operations, all as further provided in the Code. The
classification of the trust issuing notes as a REIT generally will not have any
tax consequences for a beneficial owner of a note.

     Classification of Trust Certificates Generally.

     With respect to each series of trust certificates for which no REMIC or
FASIT election is made, Company Counsel will deliver its opinion (unless
otherwise limited by the related prospectus supplement) that, assuming
compliance with the trust agreement, either: (1) the trust will be classified as
a trust under applicable Treasury regulations and will not be taxable as a
corporation and that each beneficial owner of a certificate will be an owner of
the trust under the provisions of subpart E, part I, of subchapter J of the Code
(we refer to such a trust herein as a "Grantor Trust" and to the certificates
issued by the trust as "Grantor Trust Certificates"); or (2) the trust will be
classified as a partnership for federal income tax purposes that is not taxable
as a corporation under the taxable mortgage pool rules of Section 7701(i) of the
Code or the publicly traded partnership rules of Section 7704 of the Code and
that each beneficial owner of a certificate issued by the trust will be a
partner in that partnership (we refer to such certificates as "Partner
Certificates"). The depositor and the trustee will agree, and the beneficial
owners of Grantor Trust Certificates or Partner Certificates will agree by their
purchase of such securities, to treat the trust and the related securities
consistent with the manner provided in the related supplement for all tax
purposes. The proper characterization of the arrangement involving Grantor Trust
Certificates or Partner Certificates may not be clear, because there may be no
authority on closely comparable transactions. For a discussion of the tax
treatment of Grantor Trust Certificates, see "-- Grantor Trust Certificates"
below, and for a discussion of the tax treatment of Partner Certificates, see
"-- Partner Certificates" below.

TAXATION OF SECURITIES TREATED AS DEBT INSTRUMENTS

     When we refer to "Debt Securities" in the discussion that follows, we mean
(i) REMIC regular certificates, (ii) FASIT regular certificates, and (iii) notes
issued by a trust that does not make a REMIC or FASIT election. This discussion
is based in part on the regulations applicable to original issue discount (the
"OID Regulations") and in part on the provisions of the Tax Reform Act of 1986
(the "1986 Act"). Prospective investors should be aware, however, that the OID
Regulations do not adequately address certain issues relevant to prepayable
securities, such as the Debt Securities. To the extent that those issues are not
addressed in the OID Regulations, the trustee intends to apply the methodology
described in the Conference Committee Report to the 1986 Act. No assurance can
be provided that the IRS will not take a different position as to those matters
not currently addressed by the OID Regulations. Moreover, the OID Regulations
include an anti-abuse rule allowing the IRS to apply or depart from the OID
Regulations where necessary or appropriate to ensure a reasonable tax result
because of the applicable statutory provisions. A tax result will not be
considered unreasonable under the anti-abuse rule in the absence of a
substantial effect on the present value of a taxpayer's tax liability.
Prospective investors are advised to consult their own tax advisors as to the
discussion therein and the appropriate method for reporting interest and
original issue discount ("OID") with respect to Debt Securities.

     Interest Income and OID.

     Debt Securities may be treated as having been issued with OID. A debt
instrument is issued with OID to the extent its stated redemption price at
maturity exceeds its issue price by more than a de minimis amount. Although not
clear, the de minimis amount for a class of Debt Securities would appear to
equal the product of (1) 0.25 percent, (2) the stated redemption price at
maturity of the


                                       88


class and (3) the weighted average maturity of the class, computed by taking
into account the prepayment assumption discussed below. A beneficial owner of a
Debt Security generally must report de minimis OID with respect to that Debt
Security pro rata as principal payments are received, and that income will be
capital gain if the Debt Security is held as a capital asset.

     For OID purposes, the issue price of a Debt Security generally is the first
price at which a substantial amount of that class is sold to the public
(excluding bond houses, brokers and underwriters). Although unclear under the
OID Regulations, it is anticipated that the trustee will treat the issue price
of a Debt Security as to which there is no substantial sale as of the issue
date, or that is retained by the depositor, as the fair market value of the
class as of the issue date. The issue price of a Debt Security also includes any
amount paid by an beneficial owner of that Debt Security for accrued interest
that relates to a period before the issue date of the Debt Security, unless the
Security Owner elects on its federal income tax return to exclude that amount
from the issue price and to recover it on the first distribution date.

     The stated redemption price at maturity of a debt instrument includes all
payments, other than interest unconditionally payable at fixed intervals of one
year or less at either a fixed rate or a variable rate ("Qualified Stated
Interest"). Interest is unconditionally payable only if either (1) reasonable
legal remedies exist to compel the timely payment of interest or (2) the terms
or conditions under which the debt instrument is issued make the late payment or
nonpayment of interest a remote likelihood. Because a portion of the interest
payable on the Debt Securities may be deferred, it is possible that some or all
of such interest may not be treated as unconditionally payable. Nevertheless,
for tax information reporting purposes, unless disclosed otherwise in the
applicable prospectus supplement, the trustee or other person responsible for
tax information reporting will treat all stated interest on each class of Debt
Securities as Qualified Stated Interest, provided that class is not an
interest-only class, a class the interest on which is not payable currently in
all accrual periods (an "accrual class"), or a class the interest on which is
substantially disproportionate to its principal amount (a "super-premium
class").

     To the extent stated interest payable on a class of Debt Securities, other
than a class of REMIC regular certificates or FASIT regular certificates, is
Qualified Stated Interest, such interest will be taxable as ordinary income to a
Security Owner in accordance with such Security Owner's method of tax
accounting. If, however, all or a portion of the stated interest payable on the
class of Debt Securities is not Qualified Stated Interest, then the stated
interest, or portion thereof, would be included in the Debt Security's stated
redemption price at maturity. Qualified Stated Interest payable on a REMIC
regular certificate or FASIT regular certificate must be included in the income
of the Security Owner under an accrual method of accounting, regardless of the
method otherwise used by the Security Owner.

     If a Debt Security is issued with OID, a Security Owner will be required to
include in income, as ordinary income, the daily portion of such OID
attributable to each day it holds such Debt Security. This requirement generally
will result in the accrual of income before the receipt of cash attributable to
that income.

     The daily portion of such OID will be determined on a constant yield to
maturity basis in accordance with Section 1272(a)(6) of the Code (the "PAC
Method"). Under the PAC Method, the amount of OID allocable to any accrual
period for a class of Debt Securities will equal (1) the sum of (i) the adjusted
issue price of that class of Debt Securities at the end of the accrual period
and (ii) any payments made on that class of Debt Securities during the accrual
period of amounts included in the stated redemption price at maturity of that
class of Debt Securities, minus (2) the adjusted issue price of that class of
Debt Securities at the beginning of the accrual period. The OID so determined is
allocated ratably among the days in the accrual period to determine the daily
portion for each such day. The trustee will treat the monthly period (or shorter
period from the date of original issue) ending on the day before each
Distribution Date as the accrual period.

     The adjusted issue price of a class of Debt Securities at the beginning of
its first accrual period will be its issue price. The adjusted issue price at
the end of any accrual period (and, therefore, at the beginning of the
subsequent accrual period) is determined by discounting the remaining payments
due


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on that class of Debt Securities at their yield to maturity. The remaining
payments due are determined based on the prepayment assumption made in pricing
the Debt Securities, but are adjusted to take into account the effect of
payments actually made on the trust's assets.

     For this purpose, the yield to maturity of a class of Debt Securities is
determined by projecting payments due on that class of Debt Securities based on
a prepayment assumption made with respect to the trust's assets. The yield to
maturity of a class of Debt Securities is the discount rate that, when applied
to the stream of payments projected to be made on that class of Debt Securities
as of its issue date, produces a present value equal to the issue price of that
class of Debt Securities. The Code requires that the prepayment assumption be
determined in the manner prescribed in Treasury Department regulations. To date,
no such regulations have been issued. The legislative history of this Code
provision indicates that the regulations will provide that the assumed
prepayment rate must be the rate used by the parties in pricing the particular
transaction. The prospectus supplement related to each series will describe the
prepayment assumption to be used for tax reporting purposes. No representation,
however, is made as to the rate at which principal payments or recoveries on the
trust's assets actually will occur.

     Under the PAC Method, accruals of OID will increase or decrease (but never
below zero) to reflect the fact that payments on the trust's assets are
occurring at a rate that is faster or slower than that assumed under the
prepayment assumption. If the OID accruing on a class of Debt Securities is
negative for any period, a beneficial owner of a Debt Security of that class
will be entitled to offset such negative accruals only against future positive
OID accruals on that Debt Security.

     Variable Rate Securities.

     Debt Securities may provide for interest based on a variable rate. The
amount of OID for a Debt Security bearing a variable rate of interest will
accrue in the manner described under "-- Interest Income and OID" above, with
the yield to maturity and future payments on that Debt Security generally to be
determined by assuming that interest will be payable for the life of the Debt
Security based on the initial rate (or, if different, the value of the
applicable variable rate as of the pricing date) for that Debt Security. It is
anticipated that the trustee will treat interest payable at a variable rate as
Qualified Stated Interest, other than variable interest on an interest-only
class, super-premium class or accrual class. OID reportable for any period will
be adjusted based on subsequent changes in the applicable interest rate index.

     Acquisition Premium.

     If a Security Owner purchases a Debt Security for a price that is greater
that its adjusted issue price but less than its stated redemption price at
maturity, the Security Owner will have acquired the Debt Security at an
"acquisition premium" as that term is defined in Section 1272(a)(7) of the Code.
The Security Owner must reduce future accruals of OID on the Debt Security by
the amount of the acquisition premium. Specifically, a Security Owner must
reduce each future accrual of OID on the Debt Security by an amount equal to the
product of the OID accrual and a fixed fraction, the numerator of which is the
amount of the acquisition premium and the denominator of which is the OID
remaining to be accrued on the Debt Security at the time the Security Owner
purchased the Debt Security. Security Owners should be aware that this fixed
fraction methodology will not always produce the appropriate recovery of
acquisition premium in situations where stated interest on a Debt Security is
included in the Debt Security's stated redemption price at maturity because the
total amount of OID remaining to be accrued on such a Debt Security at the time
of purchase is not fixed.

     Market Discount.

     If a purchaser acquires a Debt Security at a discount from its outstanding
principal amount (or, if the Debt Security is issued with OID, its adjusted
issue price), the purchaser will acquire the Debt Security with market discount
(a "market discount bond"). If the market discount is less than a statutorily
defined de minimis amount (presumably equal to the product of (i) 0.25 percent,
(ii) the stated redemption price at maturity of the Debt Security and (iii) the
remaining weighted average maturity of the Debt Security), the market discount
will be considered to be zero. It appears that de minimis market discount would
be reported in a manner similar to de minimis OID. See "-- Interest Income and
OID" above.


                                       90


     Treasury regulations interpreting the market discount rules have not yet
been issued; therefore, we recommend that prospective investors consult their
own tax advisors regarding the application of those rules and the advisability
of making any of the elections described below.

     Unless the beneficial owner of a market discount bond elects under Section
1278(b) of the Code to include market discount in income as it accrues, any
principal payment (whether a scheduled payment or a prepayment) or any gain on
disposition of the market discount bond will be treated as ordinary income to
the extent that it does not exceed the accrued market discount at the time of
such payment. If the beneficial owner makes the election under Section 1278(b)
of the Code, the election will apply to all market discount bonds acquired by
the beneficial owner at the beginning of the first taxable year to which the
election applies and all market discount bonds thereafter acquired by it. The
election may be revoked only with the consent of the IRS.

     The Code grants the Treasury Department authority to issue regulations
providing for the computation of accrued market discount on debt instruments,
such as the Debt Securities, the principal of which is payable in more than one
installment, but no regulations have been issued. The relevant legislative
history provides that, until such regulations are issued, the beneficial owner
of a market discount bond may elect to accrue market discount either on the
basis of a constant interest rate or according to a pro rata method described in
the legislative history. Under that method, the amount of market discount that
accrues in any accrual period in the case of a Debt Security issued with OID
equals the product of (i) the market discount that remains to be accrued as of
the beginning of the accrual period and (ii) a fraction, the numerator of which
is the OID accrued during the accrual period and the denominator of which is the
sum of the OID accrued during the accrual period and the amount of OID remaining
to be accrued as of the end of the accrual period. In the case of a Debt
Security that was issued without OID, the amount of market discount that accrues
in any accrual period will equal the product of (i) the market discount that
remains to be accrued as of the beginning of the accrual period and (ii) a
fraction, the numerator of which is the amount of stated interest accrued during
the accrual period and the denominator of which is the total amount of stated
interest remaining to be accrued at the beginning of the accrual period. For
purposes of determining the amount of OID or interest remaining to be accrued
with respect to a class of Debt Securities, the prepayment assumption applicable
to calculating the accrual of OID on such Debt Securities applies.

     If a beneficial owner of a Debt Security incurred or continues indebtedness
to purchase or hold Debt Securities with market discount, the beneficial owner
may be required to defer a portion of its interest deductions for the taxable
year attributable to any such indebtedness. Any such deferred interest expense
would not exceed the market discount that accrues during such taxable year and
is, in general, allowed as a deduction not later than the year in which such
market discount is includible in income. If such beneficial owner elects to
include market discount in income currently as it accrues under Section 1278(b)
of the Code, the interest deferral rule will not apply.

     Amortizable Bond Premium.

     A purchaser of a Debt Security that purchases the Debt Security for an
amount (net of accrued interest) greater than its stated redemption price at
maturity will have premium with respect to that Debt Security in the amount of
the excess. Such a purchaser need not include in income any remaining OID with
respect to that Debt Security and may elect to amortize the premium under
Section 171 of the Code. If a Security Owner makes this election, the amount of
any interest payment that must be included in the Security Owner's income for
each period will be reduced by a portion of the premium allocable to the period
based on a constant yield method. In addition, the relevant legislative history
states that premium should be amortized in the same manner as market discount.
The election under Section 171 of the Code also will apply to all debt
instruments (the interest on which is not excludable from gross income) held by
the Security Owner at the beginning of the first taxable year to which the
election applies and to all such taxable debt instruments thereafter acquired by
it. The election may be revoked only with the consent of the IRS.

     Non-Pro Rata Securities.

     A Debt Security may provide for certain amounts of principal to be
distributed upon the request of a Security Owner or by random lot (a "non-pro
rata security"). In the case of a non-pro rata


                                       91


security, it is anticipated that the trustee will determine the yield to
maturity based upon the anticipated payment characteristics of the class as a
whole under the prepayment assumption. In general, the OID accruing on each
non-pro rata security in an accrual period would be its allocable share of the
OID for the entire class, as determined in accordance with the discussion of OID
above. However, in the case of a distribution in retirement of the entire unpaid
principal balance of any non-pro rata security (or portion of the unpaid
principal balance), (a) the remaining unaccrued OID allocable to the security
(or to that portion) will accrue at the time of the distribution, and (b) the
accrual of OID allocable to each remaining security of that class will be
adjusted by reducing the present value of the remaining payments on that class
and the adjusted issue price of that class to the extent attributable to the
portion of the unpaid principal balance thereof that was distributed. The
depositor believes that the foregoing treatment is consistent with the "pro rata
prepayment" rules of the OID Regulations, but with the rate of accrual of OID
determined based on the prepayment assumption for the class as a whole.
Prospective investors are advised to consult their tax advisors as to this
treatment.

     Election to Treat All Interest as OID.

     The OID Regulations permit a beneficial owner of a Debt Security to elect
to accrue all interest, discount (including de minimis OID and de minimis market
discount), and premium in income as interest, based on a constant yield method
(a "constant yield election"). It is unclear whether, for this purpose, the
initial prepayment assumption would continue to apply or if a new prepayment
assumption as of the date of the Security Owner's acquisition would apply. If
such an election were to be made and the Debt Securities were acquired at a
premium, such a Security Owner would be deemed to have made an election to
amortize bond premium under Section 171 of the Code, which is described above.
Similarly, if the Security Owner had acquired the Debt Securities with market
discount, the Security Owner would be considered to have made the election in
Section 1278(b) of the Code, which is described above. A constant yield election
may be revoked only with the consent of the IRS.


     Treatment of Losses.

     Security Owners that own REMIC regular certificates or FASIT regular
certificates, or in the case of Debt Securities for which a REMIC of FASIT
election is not made, Security Owners that use the accrual method of accounting,
will be required to report income with respect to such Debt Securities on the
accrual method without giving effect to delays and reductions in distributions
attributable to defaults or delinquencies on any of the trust's assets, except
possibly, in the case of income that constitutes Qualified Stated Interest, to
the extent that it can be established that such amounts are uncollectible. In
addition, potential investors are cautioned that while they generally may cease
to accrue interest income if it reasonably appears that the interest will be
uncollectible, the IRS may take the position that OID must continue to be
accrued in spite of its uncollectibility until the Debt Security is disposed of
in a taxable transaction or becomes worthless in accordance with the rules of
Section 166 of the Code. As a result, the amount of income required to be
reported by a Security Owner in any period could exceed the amount of cash
distributed to such Security Owner in that period.

     Although not entirely clear, it appears that: (a) a Security Owner who
holds a Debt Security in the course of a trade or business or a Security Owner
that is a corporation generally should be allowed to deduct as an ordinary loss
any loss sustained on account of the Debt Security's partial or complete
worthlessness and (b) a noncorporate Security Owner who does not hold the Debt
Security in the course of a trade or business generally should be allowed to
deduct as a short-term capital loss any loss sustained on account of the Debt
Security's complete worthlessness. Security Owners should consult their own tax
advisors regarding the appropriate timing, character and amount of any loss
sustained with respect to a Debt Security, particularly subordinated Debt
Securities.

     Sale or Other Disposition.

     If a beneficial owner of a Debt Security sells, exchanges or otherwise
disposes of the Debt Security, or the Debt Security is redeemed, the beneficial
owner will recognize gain or loss in an


                                       92


amount equal to the difference between the amount realized by the beneficial
owner upon the sale, exchange, redemption or other disposition and the
beneficial owner's adjusted tax basis in the Debt Security. The adjusted tax
basis of a Debt Security to a particular beneficial owner generally will equal
the beneficial owner's cost for the Debt Security, increased by any market
discount and OID previously included by such beneficial owner in income with
respect to the Debt Security and decreased by the amount of bond premium, if
any, previously amortized and by the amount of payments that are part of the
Debt Security's stated redemption price at maturity previously received by such
beneficial owner. Any such gain or loss will be capital gain or loss if the
Debt Security was held as a capital asset, except for gain representing accrued
interest and accrued market discount not previously included in income. Capital
losses generally may be used only to offset capital gains.

     Gain from the sale of a REMIC regular certificate that might otherwise be
treated as capital gain will be treated as ordinary income to the extent that
such gain does not exceed the excess of (1) the amount that would have been
includible in the Security Owner's income had the income accrued at a rate equal
to 110 percent of the AFR as of the date of purchase, over (2) the amount
actually includible in such Security Owner's income.

     Foreign Persons.

     Interest (including OID) paid to or accrued by a beneficial owner of a Debt
Security who is a Foreign Person generally will be considered "portfolio
interest" and generally will not be subject to United States federal income tax
or withholding tax, provided the interest is not effectively connected with the
conduct of a trade or business within the United States by the Foreign Person
and the Foreign Person (i) is not actually or constructively a 10 percent
shareholder of the issuer of the Debt Securities or a controlled foreign
corporation with respect to which the issuer of the Debt Securities is a related
person (all within the meaning of the Code) and (ii) provides the trustee or
other person who is otherwise required to withhold U.S. tax with respect to the
Debt Securities (the "withholding agent") with an appropriate statement on Form
W-8 BEN (Certificate of Foreign Status of Beneficial Owner for United States Tax
Withholding). If a Debt Security 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
provided by the Foreign Person that owns the Debt Security. If the information
shown on Form W-8BEN changes, a new Form W-8BEN must be filed. If the foregoing
requirements are not met, then interest (including OID) on the Debt Securities
will be subject to United States federal income and withholding tax at a rate of
30 percent, unless reduced or eliminated pursuant to an applicable tax treaty.

     Under Treasury regulations relating to withholding obligations, a payment
to a foreign partnership is treated, with some exceptions, as a payment directly
to the partners, so that the partners are required to provide any required
certifications. We recommend that Foreign Persons that intend to hold a Debt
Security through a partnership or other pass-through entity consult their own
tax advisors regarding the application of those Treasury regulations to an
investment in a Debt Security.

     Any capital gain realized on the sale, redemption, retirement or other
taxable disposition of a Debt Security by a Foreign Person will be exempt from
United States federal income and withholding tax, provided that (i) such gain is
not effectively connected with the conduct of a trade or business in the United
States by the Foreign Person and (ii) in the case of a Foreign Person who is an
individual, the Foreign Person is not present in the United States for 183 days
or more in the taxable year.

     Information Reporting.

     Payments of interest (including OID, if any) on a Debt Security held by a
U.S. Person other than a corporation or other exempt holder are required to be
reported to the IRS. Moreover, each trust is required to make available to
Security Owners that hold beneficial interests in Debt Securities issued by that
trust information concerning the amount of OID and Qualified Stated Interest
accrued for each accrual period for which the Debt Securities are outstanding,
the adjusted issue price of the Debt


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Securities as of the end of each accrual period, and information to enable a
Security Owner to compute accruals of market discount or bond premium using the
pro rata method described under "-- Market Discount" above.

     Payments of interest (including OID, if any) on a Debt Security held by a
Foreign Person are required to be reported annually on IRS Form 1042-S, which
the withholding agent must file with the IRS and furnish to the recipient of the
income.

REMIC RESIDUAL CERTIFICATES

     If you are a Residual Owner, you will be required to report the daily
portion of the taxable income or, subject to the limitation described under "--
Basis Rules and Distributions" below, the net loss of the REMIC for each day
during a calendar quarter that you are a Residual Owner. The requirement that
Residual Owners report their pro rata share of taxable income or net loss of the
REMIC will continue until there are no certificates of any class of the related
series outstanding. For this purpose, the daily portion will be determined by
allocating to each day in the calendar quarter a ratable portion of the taxable
income or net loss of the REMIC for the quarter. The daily portions then will be
allocated among the Residual Owners in accordance with their percentage of
ownership on each day. Any amount included in the gross income of, or allowed as
a loss to, any Residual Owner will be treated as ordinary income or loss.

     Taxable Income or Net Loss of the REMIC.

     Generally, a REMIC determines its taxable income or net loss for a given
calendar quarter in the same manner as would an individual having the calendar
year as his taxable year and using the accrual method of accounting. There are,
however, certain modifications. First, a deduction is allowed for accruals of
interest and OID on the REMIC regular certificates issued by the REMIC. Second,
market discount will be included in income as it accrues, based on a constant
yield to maturity method. Third, no item of income, gain, loss or deduction
allocable to a prohibited transaction is taken into account. Fourth, the REMIC
generally may deduct only items that would be allowed in calculating the taxable
income of a partnership under Section 703(a) of the Code. Fifth, the limitation
on miscellaneous itemized deductions imposed on individuals by Section 67 of the
Code does not apply at the REMIC level to investment expenses such as trustee
fees or servicing fees. See, however, "-- Pass Through of Certain Expenses"
below. If the deductions allowed to the REMIC exceed its gross income for a
calendar quarter, such excess will be the net loss for the REMIC for that
calendar quarter. For purposes of determining the income or loss of a REMIC, the
regulations applicable to REMICs provide that a REMIC has a tax basis in its
assets equal to the total of the issue prices of all regular and residual
interests in the REMIC.

     Pass Through of Certain Expenses.

     A Residual Owner who is an individual, estate, or trust will be required to
include in income a share of the expenses of the related REMIC and may deduct
those expenses subject to the limitations of Sections 67 and 68 of the Code. See
"-- Grantor Trust Certificates -- Trust Expenses" below for a discussion of the
limitations of Sections 67 and 68 of the Code. Those expenses may include the
servicing fees and all administrative and other expenses relating to the REMIC.
In addition, those expenses are not deductible for purposes of computing the
alternative minimum tax, and may cause those investors to be subject to
significant additional tax liability. Similar rules apply to individuals,
estates and trusts holding a REMIC residual certificate through certain
pass-through entities.

     Excess Inclusions.

     Excess inclusions with respect to a REMIC residual certificate are subject
to special tax rules. For any Residual Owner, the excess inclusion for any
calendar quarter will generally equal the excess of the sum of the daily
portions of the REMIC's taxable income allocated to the Residual Owner over the
amount of income that the Residual Owner would have accrued if the REMIC
residual certificate were a debt instrument having a yield to maturity equal to
120 percent of the long-term AFR in effect at the time of issuance of the REMIC
residual certificate. If the issue price of a REMIC residual


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certificate is zero, which would be the case if the REMIC residual certificate
had no economic value at issuance, then all of the daily portions of income
allocated to the Residual Owner will be excess inclusions. The issue price of a
REMIC residual certificate issued for cash generally will equal the price paid
by the first buyer, and if the REMIC residual certificate is issued for
property, the issue price will be its fair market value at issuance.

     For Residual Owners, an excess inclusion may not be offset by deductions,
losses, or loss carryovers. Thus, a Residual Owner that has losses in excess of
income for a taxable year would, nevertheless, be required to pay tax on excess
inclusions. For Residual Owners that are subject to tax on unrelated business
taxable income (as defined in Section 511 of the Code), an excess inclusion is
treated as unrelated business taxable income. For Residual Owners that are
nonresident alien individuals or foreign corporations generally subject to
United States withholding tax, even if interest paid to such Residual Owners is
generally eligible for exemptions from such tax, an excess inclusion will be
subject to such tax and no tax treaty rate reduction or exemption may be claimed
with respect thereto.

     Alternative minimum taxable income for a Residual Owner is determined
without regard to the special rule that taxable income may not be less than the
sum of the Residual Owner's excess inclusions for the year. Alternative minimum
taxable income cannot, however, be less than the sum of a Residual Owner's
excess inclusions for the year. Also, the amount of any alternative minimum tax
net operating loss deduction must be computed without regard to any excess
inclusions.

     Finally, if a REIT or a regulated investment company owns a REMIC residual
certificate, a portion (allocated under Treasury regulations yet to be issued)
of dividends paid by the REIT or regulated investment company could not be
offset by net operating losses of its shareholders, would constitute unrelated
business taxable income for tax-exempt shareholders, and would be ineligible for
reduction of withholding to certain persons who are not U.S. Persons.

     Taxable Income May Exceed Distributions.

     In light of the tax consequences to a Residual Owner, the taxable income
from a REMIC residual certificate may exceed cash distributions with respect
thereto in any taxable year. The taxable income recognized by a Residual Owner
in any taxable year will be affected by, among other factors, the relationship
between the timing of recognition of interest, OID or market discount income or
amortization of premium for the mortgage loans, on the one hand, and the timing
of deductions for interest (including OID) or income from amortization of issue
premium on the regular interests, on the other hand. If an interest in the
mortgage loans is acquired by the REMIC at a discount, and one or more of these
mortgage loans is prepaid, the proceeds of the prepayment may be used in whole
or in part to make distributions in reduction of principal on the regular
interests, and (2) the discount on the mortgage loans that is includible in
income may exceed the deduction allowed upon those distributions on those
regular interests on account of any unaccrued OID relating to those regular
interests. When there is more than one class of regular interests that
distribute principal sequentially, this mismatching of income and deductions is
particularly likely to occur in the early years following issuance of the
regular interests when distributions in reduction of principal are being made in
respect of earlier classes of regular interests to the extent that those classes
are not issued with substantial discount or are issued at a premium. If taxable
income attributable to that mismatching is realized, in general, losses would be
allowed in later years as distributions on the later maturing classes of regular
interests are made.

     Taxable income also may be greater in earlier years that in later years as
a result of the fact that interest expense deductions, expressed as a percentage
of the outstanding principal amount of that series of regular interests, may
increase over time as distributions in reduction of principal are made on the
lower yielding classes of regular interests, whereas, to the extent the REMIC
consists of fixed rate mortgage loans, interest income for any particular
mortgage loan will remain constant over time as a percentage of the outstanding
principal amount of that loan. Consequently, Residual Owners must have
sufficient other sources of cash to pay any federal, state, or local income
taxes due as a result of that mismatching or unrelated deductions against which
to offset that income, subject to the discussion of excess inclusions under
"--Excess Inclusions" above. The timing of mismatching of


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income and deductions described in this paragraph, if present for a series of
REMIC certificates, may have a significant adverse effect upon a Residual
Owner's after-tax rate of return.

     Basis Rules and Distributions.

     A Residual Owner's adjusted basis in a REMIC residual certificate will
equal the amount paid for the REMIC residual certificate, increased by the sum
of the daily portions of REMIC income taken into account by the Residual Owner,
and decreased by the sum of (i) the daily portions of REMIC net loss taken into
account by the Residual Owner and (ii) distributions made by the REMIC to the
Residual Owner.

     A distribution by a REMIC to a Residual Owner will not be includible in
gross income by the Residual Owner if the distribution does not exceed the
Residual Owner's adjusted basis in the REMIC residual certificate immediately
before the distribution. The distribution will reduce the Residual Owner's
adjusted basis of such interest, but not below zero. To the extent a
distribution exceeds the Residual Owner's adjusted basis in the REMIC residual
certificate, the excess will be treated as gain from the sale of the REMIC
residual certificate. See "-- Sales of REMIC Residual Certificates" below.

     A Residual Owner is not allowed to take into account any net loss for any
calendar quarter to the extent such net loss exceeds such Residual Owner's
adjusted basis in its REMIC residual certificate as of the close of such
calendar quarter, determined without regard to such net loss. Any loss
disallowed by reason of this limitation may be carried forward indefinitely to
future calendar quarters and, subject to the same limitation, may be used by
that Residual Owner to offset income from the REMIC residual certificate.

     The effect of these basis and distribution rules is that a Residual Owner
may not amortize its basis in a REMIC residual certificate but may only recover
its basis through distributions, through the deduction of any net losses of the
REMIC, or upon the sale of its REMIC residual certificate. See "-- Sales of
REMIC Residual Certificates."

     Sales of REMIC Residual Certificates.

     If a Residual Owner sells a REMIC residual certificate, the Residual Owner
will recognize gain or loss equal to the difference between the amount realized
on the sale and its adjusted basis in the REMIC certificate. If a Residual Owner
sells a REMIC residual certificate at a loss, the loss will not be recognized
if, within six months before or after the sale of the REMIC residual
certificate, the Residual Owner purchases another residual interest in any REMIC
or any interest in a taxable mortgage pool (as defined in Section 7701(i) of the
Code) comparable to a residual interest in a REMIC. Such disallowed loss will be
allowed upon the sale of the other residual interest (or comparable interest) if
the rule referred to in the preceding sentence does not apply to that sale.

     Inducement Fees.

     Regulations have been proposed regarding the federal income tax treatment
of "inducement fees" received by transferees of non-economic REMIC residual
interests. The proposed regulations (i) provide tax accounting rules for the
treatment of such fees as income over an appropriate period and (ii) specify
that inducement fees constitute income from sources within the United States.
The proposed regulations provide that the final regulations will be applicable
to taxable years ending on or after the date final regulations are published,
and thus yet to be issued final regulations may apply to the treatment of any
inducement fee received in connection with the acquisition of a Residual
Certificate. Prospective purchasers of the Residual Certificates should consult
with their tax advisors regarding the effect of these proposed regulations.

     Disqualified Organizations.

     If a Residual Owner were to transfer a REMIC residual certificate to a
disqualified organization, the Residual Owner would be subject to a tax in an
amount equal to the maximum corporate tax rate applied to the present value
(using a discount rate equal to the applicable AFR) of the total anticipated
excess inclusions with respect to such residual interest for the periods after
the transfer.


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For this purpose, disqualified organizations include the United States, any
state or political subdivision of a state, any foreign government or
international organization or any agency or instrumentality of any of the
foregoing; any tax-exempt entity (other than a Section 521 cooperative) which
is not subject to the tax on unrelated business income; and any rural
electrical or telephone cooperative. However, a transferor of a REMIC residual
certificate would in no event be liable for the tax for a transfer if the
transferee furnished to the transferor an affidavit stating that the transferee
is not a disqualified organization and, as of the time of the transfer, the
transferor does not have actual knowledge that the affidavit is false.

     The anticipated excess inclusions must be determined as of the date that
the REMIC residual certificate is transferred and must be based on events that
have occurred up to the time of such transfer, the prepayment assumption (see
"-- Taxation of Securities Treated as Debt Instruments -- Interest Income and
OID," for a discussion of the prepayment assumption), and any required or
permitted clean up calls or required liquidation provided for in the trust
agreement. The tax generally is imposed on the transferor of the REMIC residual
certificate, except that it is imposed on an agent for a disqualified
organization if the transfer occurs through such agent. The trust agreement for
each series of REMIC certificates will require, as a prerequisite to any
transfer of a REMIC residual certificate, the delivery to the trustee of an
affidavit of the transferee to the effect that it is not a disqualified
organization and will contain other provisions designed to render any attempted
transfer of a REMIC residual certificate to a disqualified organization void.

     In addition, if a pass through entity includes in income excess inclusions
with respect to a REMIC residual certificate, and a disqualified organization is
the record holder of an interest in such entity at any time during any taxable
year of such entity, then a tax will be imposed on the entity equal to the
product of (1) the amount of excess inclusions on the REMIC residual certificate
for such taxable year that are allocable to the interest in the pass through
entity held by such disqualified organization and (2) the highest marginal
federal income tax rate imposed on corporations. A pass through entity will not
be subject to this tax for any period with respect to an interest in such
entity, however, if the record holder of such interest furnishes to such entity
(1) such holder's social security number and a statement under penalties of
perjury that such social security number is that of the record holder or (2) a
statement under penalties of perjury that such record holder is not a
disqualified organization. For these purposes, a "pass through entity" means any
regulated investment company, REIT, trust, partnership or certain other entities
described in Section 860E(e)(6) of the Code. In addition, a person holding an
interest in a pass through entity as a nominee for another person shall, with
respect to such interest, be treated as a pass through entity. Moreover, in the
case of any "electing large partnership," within the meaning of Section 775 of
the Code, all record holders are considered to be disqualified organizations so
that the partnership itself will be subject to tax on the excess inclusions and
such excess inclusions will be excluded in determining partnership income. The
exception to this tax, otherwise available to a pass through entity that is
furnished certain affidavits by record holders of interests in the entity and
that does not know those affidavits are false, is not available to an electing
large partnership.

     Noneconomic REMIC Residual Certificates.

     A transfer of a "noneconomic" REMIC residual certificate will be
disregarded for all federal income tax purposes if a significant purpose of the
transfer was to enable the transferor to impede the assessment or collection of
tax. If such transfer is disregarded, the purported transferor will continue to
be treated as the Residual Owner and will, therefore, be liable for any taxes
due with respect to the daily portions of income allocable to such noneconomic
REMIC residual certificate.

     A REMIC residual certificate is noneconomic for this purpose unless, at the
time of its transfer, (1) the present value of the expected future distributions
on the REMIC residual certificate at least equals the product of the present
value of the anticipated excess inclusions and the highest tax rate applicable
to corporations for the year of the transfer and (2) the transferor reasonably
expects that the transferee will receive distributions with respect to the REMIC
residual certificate at or after the time the taxes accrue on the anticipated
excess inclusions in an amount sufficient to satisfy the accrued taxes. The
present value computations are based on a discount rate equal to the applicable
AFR and


                                       97


a prepayment assumption used in computing income on the mortgage loans held by
the trust. See "-- Taxation of Securities Treated as Debt Instruments --
Interest Income and OID," for a discussion concerning prepayment assumptions.

     All transfers of REMIC residual certificates will be subject to certain
restrictions under the terms of the related trust agreement that are intended to
reduce the possibility of any such transfer being disregarded. Such restrictions
will require each party to a transfer to provide an affidavit that no purpose of
such transfer is to impede the assessment or collection of tax, including
certain representations as to the financial condition of the prospective
transferee.

     Prior to purchasing a REMIC residual certificate, prospective purchasers
should consider the possibility that a purported transfer of such REMIC residual
certificate by such a purchaser to another purchaser at some future date may be
disregarded in accordance with the above-described rules, which would result in
the retention of tax liability by such purchaser. The applicable prospectus
supplement will disclose whether offered REMIC residual certificates may be
considered noneconomic residual interests; provided, however, that any
disclosure that a REMIC residual certificate will or will not be considered
noneconomic will be based upon certain assumptions, and the depositor will make
no representation that a REMIC residual certificate will not be considered
noneconomic for purposes of the above-described rules or that a Residual Owner
will receive distributions calculated pursuant to such assumptions.

     The Treasury Department recently adopted final regulations setting forth
the requirements of a safe harbor under which a transfer of a noneconomic
residual is presumed to be a valid transfer that will be respected for federal
income tax purposes. To qualify under the safe harbor:

     o  the transferor must perform a reasonable investigation of the financial
        status of the transferee and determine that the transferee has
        historically paid its debts as they come due and find no significant
        evidence to indicate that the transferee will not continue to pay its
        debts as they come due;

     o  the transferor must obtain a representation from the transferee to the
        effect that the transferee understands that as the holder of the
        residual interest the transferee will recognize taxable income in excess
        of cash flow and that the transferee intends to pay taxes on the income
        as those taxes become due;

     o  the transferee must represent that it will not cause income from the
        residual interest to be attributable to a foreign permanent
        establishment or fixed base (within the meaning of an applicable income
        tax treaty) of the transferee or another U.S. taxpayer; and

     o  either (i) the present value (computed based upon a statutory discount
        rate) of the anticipated tax liabilities associated with holding the
        residual interest must be no greater than the present value of the sum
        of any consideration given to the transferee to acquire the interest,
        the anticipated distributions on the interest and the anticipated tax
        savings associated with holding the interest, or (ii) the transferee
        must be a domestic taxable C corporation that meets certain asset tests
        and that agrees that any subsequent transfer of the interest will
        satisfy the same safe harbor provision and be to a domestic taxable C
        corporation.

     Eligibility for the safe harbor requires, among other things, that the
facts and circumstances known to the transferor at the time of transfer not
indicate to a reasonable person that the taxes with respect to the interest
will not be paid, with an unreasonably low cost for the transfer specifically
mentioned as negating eligibility. The final regulations contain additional
detail regarding their application, and you should consult your own tax advisor
regarding the application of the safe harbor to a transfer of a REMIC residual
certificate before acquiring one.

     Restrictions on Transfers of Residual Certificates to Foreign Persons.

     Transfers to a Foreign Person of REMIC residual certificates that have tax
avoidance potential are disregarded for all federal income tax purposes. If
such a transfer is disregarded, the purported transferor of the REMIC residual
certificate to the Foreign Person continues to remain liable for any


                                       98


taxes due with respect to the income on such REMIC residual certificate. A
transfer of a REMIC residual certificate has tax avoidance potential unless, at
the time of the transfer, the transferor reasonably expects (1) that the REMIC
will distribute to the transferee of the REMIC residual certificate amounts
that will equal at least 30 percent of each excess inclusion and (2) that such
amounts will be distributed at or after the time at which the excess inclusion
accrues and not later than the close of the calendar year following the
calendar year of accrual. This rule does not apply to transfers if the income
from the REMIC residual certificate is taxed in the hands of the transferee as
income effectively connected with the conduct of a U.S. trade or business.
Moreover, if a Foreign Person transfers a REMIC residual certificate to a U.S.
Person (or to a Foreign Person in whose hands income from the REMIC residual
certificate would be effectively connected income) and the transfer has the
effect of allowing the transferor to avoid tax on accrued excess inclusions,
that transfer is disregarded for all federal income tax purposes and the
purported Foreign Person transferor continues to be treated as the owner of the
REMIC residual certificate. The trust agreement for each series will preclude
the transfer of a REMIC residual certificate to a Foreign Person, other than a
Foreign Person in whose hands the income from the REMIC residual certificate
would be effectively connected with a U.S. trade or business.

     Foreign Persons.

     The Conference Committee Report to the 1986 Act indicates that amounts paid
to Residual Owners who are Foreign Persons generally should be treated as
interest for purposes of the 30 percent (or lower treaty rate) United States
withholding tax. Treasury regulations provide that amounts distributed to
Residual Owners may qualify as "portfolio interest," subject to the conditions
described in "-- Taxation of Securities Treated as Debt Instruments -- Foreign
Persons" above, but only to the extent that (i) the mortgage loans were issued
after July 18, 1984, and (ii) the trust fund to which the REMIC residual
certificate relates consists of obligations issued in "registered form" within
the meaning of Section 163 (f)(1) of the Code. Generally, mortgage loans will
not be, but regular interests in another REMIC will be, considered obligations
issued in registered form. Furthermore, Residual Owners will not be entitled to
any exemption from the 30 percent withholding tax (or lower treaty rate) to the
extent of that portion of REMIC taxable income that constitutes an "excess
inclusion." See "-- Excess Inclusions" above. If the amounts paid to Residual
Owners who are Foreign Persons are effectively connected with the conduct of a
trade or business within the United States by those Foreign Persons, the 30
percent (or lower treaty rate) withholding will not apply. Instead, the amounts
paid to those Foreign Persons will be subject to United States federal income
tax at regular rates. If the 30 percent (or lower treaty rate) withholding is
applicable, those amounts generally will be taken into account for purposes of
withholding only when paid or otherwise distributed (or when the REMIC residual
certificate is disposed of ) under rules similar to withholding upon disposition
of Debt Securities that have OID. See "-- Restrictions on Transfers of Residual
Certificates to Foreign Persons" above concerning the disregard of certain
transfers having "tax avoidance potential." Potential investors who are Foreign
Persons should consult their own tax advisors regarding the specific tax
consequences to them of owning REMIC residual certificates.

     Administrative Provisions.

     The REMIC will be required to maintain its books on a calendar year basis
and to file federal income tax returns for federal income tax purposes in a
manner similar to a partnership. The form for the income tax return is Form
1066, U.S. Real Estate Mortgage Investment Conduit Income Tax Return. The
trustee will be required to sign the REMIC's returns. Treasury regulations
provide that, except where there is a single Residual Owner for an entire
taxable year, the REMIC will be subject to the procedural and administrative
rules of the Code applicable to partnerships, including the determination by the
IRS of any adjustments to, among other things, items of REMIC income, gain, loss
deduction, or credit in a unified administrative proceeding. The master servicer
will be obligated to act as "tax matters person," as defined in applicable
Treasury regulations, for the REMIC as agent of the Residual Owners holding the
largest percentage interest in the REMIC's residual interest. If the Code or
applicable Treasury regulations do not permit the master servicer to act as tax
matters person in its capacity as agent of the Residual Owner, the Residual
Owner or any other person specified pursuant to Treasury regulations will be
required to act as tax matters person. The tax matters person


                                       99


generally has responsibility for overseeing and providing notice to the other
Residual Owner of certain administrative and judicial proceedings regarding the
REMIC's tax affairs, although other holders of the REMIC residual certificates
of the same series would be able to participate in those proceedings in
appropriate circumstances.

     Treasury regulations provide that a Residual Owner is not required to treat
items on its return consistently with their treatment on the REMIC's return if
the holder owns 100 percent of the REMIC residual certificates for the entire
calendar year. Otherwise, each Residual Owner is required to treat items on its
returns consistently with their treatment on the REMIC's return, unless the
holder either files a statement identifying the inconsistency or establishes
that the inconsistency resulted from incorrect information received from the
REMIC. The IRS may access a deficiency resulting from a failure to comply with
the consistency requirement without instituting an administrative proceeding at
the REMIC level. A REMIC typically will not register as a tax shelter pursuant
to Code Section 6111 because it generally will not have a net loss for any of
the first five taxable years of its existence. Any person that holds a REMIC
residual certificate as a nominee for another person may be required to furnish
the related REMIC, in a manner to be provided in Treasury regulations, with the
name and address of that person and other specified information.

     The IRS Form 1066 has an accompanying Schedule Q, Quarterly Notice to
Residual Interest Holders of REMIC taxable Income or Net Loss Allocation.
Treasury regulations require that a Schedule Q be furnished by the REMIC Pool to
each Residual Owner by the end of the month following the close of each calendar
quarter (41 days after the end of a quarter under proposed Treasury regulations)
in which the REMIC is in existence. Treasury regulations require that, in
addition to the foregoing requirements, information must be furnished quarterly
to Residual Owners and filed annually with the IRS concerning Section 67 of the
Code expenses (see "-- Pass Through of Certain Expenses" above) allocable to
those holders. Furthermore, under those regulations, information must be
furnished quarterly to Residual Owners and filed annually with the IRS
concerning the percentage of the REMIC's assets meeting the qualified asset
tests described under "-- Special Tax Attributes -- REMIC Certificates" below.

     Mark-to-Market Rules.

     Section 475 of the Code generally requires that securities dealers include
securities in inventory at their fair market value, recognizing gain or loss as
if the securities were sold at the end of each tax year. The Treasury
regulations provide that a REMIC residual certificate is not treated as a
security for purposes of the mark-to-market rules and thus may not be marked to
market.

FASIT OWNERSHIP CERTIFICATES

     An Ownership certificate represents the residual equity interest in a
FASIT. The beneficial owner of an Ownership certificate determines its taxable
income by taking into account all assets, liabilities and items of income, gain,
deduction, loss and credit of the FASIT (other than those allocable to
prohibited transactions as described below). In general, the character of the
income to the beneficial owner of an Ownership certificate will be the same as
the character of such income of the FASIT, except that any tax-exempt interest
income taken into account by the beneficial owner of an Ownership certificate is
treated as ordinary income. In determining that taxable income, the beneficial
owner of an Ownership certificate must determine the amount of interest, OID,
market discount and premium recognized with respect to the FASIT's assets and
the FASIT regular certificates issued by the FASIT according to a constant yield
methodology and under an accrual method of accounting. In addition, the
beneficial owner of the Ownership certificate is subject to the same limitations
on its ability to use losses to offset income from the FASIT as are the
beneficial owners of High-Yield Interests. See "-- Types of Securities -- FASIT
Certificates Generally" above.

     A Security Owner that holds an Ownership certificate will recognize gain,
but not loss, upon the contribution of assets to a FASIT to support one or more
FASIT regular certificates to the extent the value of the assets exceeds the
Security Owner's basis in those assets. In the case of debt instruments that are
not publicly traded, the value for purposes of the gain computation will be
determined by reference to a formula set out in Section 860I(d) of the Code that
will likely overstate the market


                                      100


value of those debt instruments. Any gain recognized will increase the Security
Owner's basis in the assets held in the FASIT. Proposed Treasury regulations
would, if issued in final form, provide that the Security Owner holding the
Ownership certificate would not be allowed to use non-FASIT losses to offset
the gain recognized.

     Rules similar to the wash sale rules applicable to REMIC residual
certificates also will apply to the Ownership certificate. Accordingly, losses
on dispositions of an Ownership certificate generally will be disallowed where,
within six months before or after the disposition, the seller of such security
acquires any other Ownership certificate or, in the case of a FASIT holding
mortgage assets, any REMIC residual interest or interest in a taxable mortgage
pool that is economically comparable to an Ownership certificate.

     The beneficial owner of an Ownership certificate will be subject to a tax
equal to 100 percent of the net income derived by the FASIT from any "prohibited
transactions." Prohibited transactions include:

     o  the receipt of income derived from assets that are not permitted assets;

     o  certain dispositions of permitted assets;

     o  the receipt of any income derived from any loan originated by a FASIT;
        and

     o  in certain cases, the receipt of income representing a servicing fee or
        other compensation.

     Any trust for which a FASIT election will be made will be structured in
order to avoid application of the prohibited transaction tax.

GRANTOR TRUST CERTIFICATES

     For purposes of this discussion, we refer to two types of certificates
issued by a Grantor Trust: "Standard Certificates" and "Stripped Certificates."
Each certificate issued by a Grantor Trust that is not a Stripped Certificate is
a Standard Certificate.

     Classification of Stripped Certificates.

     There generally are three situations in which a Grantor Trust Certificate
will be classified as a Stripped Certificate. First, if the trust holds assets
that pay principal and interest but issues interest-only or principal-only
certificates, all the certificates of that trust likely will be Stripped
Certificates. Second, if the seller, depositor, or some other person retains the
right to receive a portion of the interest payments on assets held in the trust,
all the certificates issued by the trust could be Stripped Certificates.
Finally, if a portion of a servicing or guarantee fee were recharacterized under
rules established by the IRS as ownership interests in stripped coupons, all the
certificates of the trust could be Stripped Certificates.

     Taxation of Stripped Certificates.

     Stripped Certificates will be treated under rules contained in Section
1286 of the Code (the "Stripped Bond Rules"). Pursuant to the Stripped Bond
Rules, the separation of ownership of some or all of the interest payments on a
debt instrument from ownership of 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. A beneficial owner of a
Stripped Certificate will be treated as owning "stripped bonds" to the extent
of its share of principal payments and "stripped coupons" to the extent of its
share of interest payments.

     Generally, if a taxpayer acquires an interest in "stripped coupons" or
"stripped bonds," the taxpayer will be treated as having purchased a newly
issued debt instrument on the date of purchase for an issue price equal to the
purchase price paid. As a result, a beneficial owner of a Stripped Certificate
would be taxed as holding a newly issued debt instrument. The tax consequences
of holding a debt instrument are discussed generally under "-- Taxation of
Securities Treated as Debt Instruments" above.

     Although a Stripped Certificate may represent a beneficial ownership
interest in stripped coupons from all or several of the assets held in the
trust, for information reporting purposes, the trustee will


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aggregate all such interests and treat each class of Stripped Certificates as a
single issue of debt instruments. Moreover, the trustee will apply the PAC
Method to compute accruals of any OID on the Stripped Certificates, as
described herein under "--Taxation of Securities Treated as Debt Instruments --
Interest Income and OID," and will comply with any tax information reporting
obligations with respect to Stripped Certificates in the manner described under
"-- Taxation of Securities Treated as Debt Instruments -- Information
Reporting." Whether aggregation of stripped coupons from several assets
acquired in a single purchase is appropriate, and whether the PAC Method should
apply to compute OID accruals on Stripped Certificates are not free from doubt.
We recommend, therefore, that a prospective investor in Stripped Certificates
consult their tax advisor concerning the application of these rules to Stripped
Certificates.

     For this purpose, the tax information will include the amount of OID
accrued on Stripped Certificates. However, the amount required to be reported by
the trustee may not be equal to the proper amount of OID required to be reported
as taxable income by a Security Owner, other than an original Security Owner who
purchased at the issue price. In particular, in the case of Stripped Securities,
the reporting will be based upon a representative initial offering price of each
class of Stripped Securities, except as set forth in the prospectus supplement.
It is not clear for this purpose whether the assumed prepayment rate that is to
be used in the case of an owner other than a Security Owner that acquires its
Stripped Certificate at original issue should be the prepayment assumption or a
new rate based on the circumstances at the date of subsequent purchase.

     A beneficial owner of a Stripped Certificate, particularly any Stripped
Certificate that is subordinate to another class, may deduct losses incurred for
the Stripped Certificate as described under "-- Taxation of Standard
Certificates" below. In addition, if the mortgage loans prepay at a rate either
faster or slower than that under the prepayment assumption, a Security Owner's
recognition of OID either will be accelerated or decelerated and the amount of
that OID either will be increased or decreased depending on the relative
interests in principal and interest on each mortgage loan represented by that
Security Owner's Stripped Certificate. While the matter is not free from doubt,
the beneficial owner of a Stripped Certificate should be entitled to recognize a
loss (which may be a capital loss) in the year that it becomes certain (assuming
no further prepayments) that the Security Owner will not recover a portion of
its adjusted basis in the Stripped Certificate, such loss being equal to that
portion of unrecoverable basis.

     In addition, each beneficial owner of a Stripped Certificate will be
required to include in income its share of the expenses of the trust, including
the servicing fees with respect to any assets held by the trust. Although not
free from doubt, for purposes of reporting to Security Owners of Stripped
Certificates, the trust expenses will be allocated to the classes of Stripped
Certificates in proportion to the distributions to those classes for the related
period. The beneficial owner of a Stripped Certificate generally will be
entitled to a deduction in respect of the trust expenses, as described under "--
Trust Expenses" below, subject to the limitation described therein.

     Purchase of More Than One Class of Stripped Certificates.

     When an investor purchases more than one class of Stripped Certificates, it
is currently unclear whether for federal income tax purposes those classes of
Stripped Certificates should be treated separately or aggregated for purposes of
the rules described above.

     Taxation of Standard Certificates.

     For federal income tax purposes, a Standard Certificate will represent an
undivided beneficial ownership interest in the assets of the Grantor Trust. As a
result, each Security Owner holding an interest in a Standard Certificate must
include in income its proportionate share of the entire income from the assets
represented by its Standard Certificate. Thus, for example, in the case of a
Standard Certificate representing ownership of mortgage loans, a beneficial
owner of the certificate would be required to include in income interest at the
coupon rate on the mortgage loans, OID (if any), and market discount (if any),
and any prepayment fees, assumption fees, and late payment charges received by
the servicer, in accordance with the beneficial owner's method of accounting. In
addition, beneficial owners of Standard Certificates, particularly any class of
a series that is subordinate to other


                                       102


classes, may incur losses of interest or principal with respect to the trust's
assets. Those losses would be deductible generally only as described under "--
Taxation of Securities Treated as Debt Instruments -- Treatment of Losses"
above.

     For information reporting purposes, although not free from doubt, the
trustee will report information concerning income accruals and principal
payments on the assets of the trust in the aggregate.

     Trust Expenses.

     Each Security Owner that holds an interest in a Grantor Trust Certificate
must include in income its share of the trust's expenses, as described above.
Each Security Owner may deduct its share of those expenses at the same time, to
the same extent, and in the same manner as such items would have been reported
and deducted had it held directly interests in the trust's assets and paid
directly its share of the servicing and related fees and expenses. Investors who
are individuals, estates or trusts who own Grantor Trust Certificates, either
directly or indirectly through certain pass-through entities, will be subject to
limitations for certain itemized deductions described in Section 67 of the Code,
including deductions for the servicing fees and all administrative and other
expenses of the trust. In general, such an investor can deduct those expenses
only to the extent that those expenses, in total, exceed 2 percent of the
investor's adjusted gross income. In addition, Section 68 of the Code provides
that itemized deductions otherwise allowable for a taxable year will be reduced
by the lesser of (i) 3 percent of the excess, if any, of adjusted gross income
over $100,000 ($50,000 in the case of a married individual filing a separate
return) (in each case, as adjusted for post-1991 inflation), and (ii) 80 percent
of the amount of itemized deductions otherwise allowable for that year. This
reduction is currently scheduled to be phased-out over a five year period
beginning 2006. As a result of the limitations set forth in Sections 67 and 68
of the Code, those investors holding Grantor Trust Certificates, directly or
indirectly through a pass-through entity, may have total taxable income in
excess of the total amount of cash received on the Grantor Trust Certificates.
In addition, those investors cannot deduct the expenses of the trust for
purposes of computing the alternative minimum tax, and thus those investors may
be subject to significant additional tax liability.

     Sales of Grantor Trust Certificates.

     If a Grantor Trust Certificate is sold, gain or loss will be recognized by
the Security Owner in an amount equal to the difference between the amount
realized on the sale and the Security Owner's adjusted tax basis in the Grantor
Trust Certificate. Such tax basis will equal the Security Owner's cost for the
Grantor Trust Certificate, increased by any OID or market discount previously
included in income and decreased by any premium previously taken into account
and by the amount of payments, other than payments of Qualified Stated Interest,
previously received with respect to such Grantor Trust Certificate. The portion
of any such gain attributable to accrued market discount not previously included
in income will be ordinary income. See "-- Taxation of Securities Treated as
Debt Instruments -- Sale or Other Disposition." Any remaining gain or any loss
will be capital gain or loss. Capital losses generally may be used only to
offset capital gains.

     Trust Reporting.

     Each registered holder of a Grantor Trust Certificate will be furnished
with each distribution a statement setting forth the allocation of such
distribution to principal and interest. In addition, within a reasonable time
after the end of each calendar year each registered holder of a Grantor Trust
Certificate at any time during such year will be furnished with information
regarding the amount of servicing compensation and other trust expenses to
enable beneficial owners of Grantor Trust Certificates to prepare their tax
returns. The trustee also will file any required tax information with the IRS,
to the extent and in the manner required by the Code.

     Foreign Persons.

     The tax and withholding rules that apply to Foreign Persons who acquire an
interest in Grantor Trust Certificates generally are the same as those that
apply to a Foreign Person who acquires an interest in Debt Securities. See the
discussion of the tax and withholding rules under "--Taxation of Securities
Treated as Debt Instruments -- Foreign Persons."


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PARTNER CERTIFICATES

     If a trust is classified as a partnership for federal income tax purposes,
the trust will not be subject to an entity level federal income tax. Instead,
pursuant to the terms of the trust agreement, the trustee will compute taxable
income for each taxable year for the trust and will allocate the income so
computed among the Security Owners owning Partner Certificates. Each such
Security Owner must take into account in computing its taxable income for
federal income tax purposes its allocable share of the trust's income for the
taxable year of the trust that ends with or within the Security Owner's taxable
year. The trust will adopt the calendar year as its taxable year unless
otherwise specified in the applicable prospectus supplement.

     Security Owner's Distributive Share.

     The trust will compute taxable income for each taxable year in the same
manner as would an individual, except that certain deductions specified in
Section 703(a)(2) of the Code are not allowed. The trustee will allocate that
taxable income among the Partner Certificates. The method of allocation will be
described in the applicable prospectus supplement.

     A share of expenses of the partnership (including fees of the master
servicer but not interest expense) allocable to a beneficial owner who is an
individual, estate or trust would constitute miscellaneous itemized deductions
subject to the limitations described under "-- Grantor Trust Certificates --
Trust Expenses" above. Accordingly, those deductions might be disallowed to the
individual in whole or in part and might result in that holder being taxed on
an amount of income that exceeds the amount of cash actually distributed to
that holder over the life of the partnership.

     Distributions.

     A distribution of cash to a Security Owner owning a Partner Certificate
will not be taxable to the Security Owner to the extent that the amount
distributed does not exceed the Security Owner's adjusted basis in the Partner
Certificate. If the amount of cash distributed exceeds a Security Owner's basis
in a Partner Certificate, the excess will be treated as though it were gain
from the sale of the Partner Certificate. If, upon receipt of a cash
distribution in liquidation of a Security Owner's interest in the trust, the
Security Owner's adjusted basis exceeds the amount distributed, the excess will
be treated as though it were a loss from the sale of the Partner Certificate.

     A Security Owner's adjusted basis in a Partner Certificate at any time will
equal the purchase price paid by the Security Owner for the Partner Certificate,
increased by allocations of income made to the Security Owner by the trust, and
decreased by distributions previously made by the trust on the Partner
Certificate and any losses allocated by the trust to the Security Owner with
respect to the Partner Certificate.

     If a trust distributes its assets in-kind to a Security Owner in
liquidation of the trust, neither the trust nor the Security Owner will
recognize gain or loss on the distribution. The Security Owner would be required
to allocate its adjusted basis in its Partner Certificate among the assets it
received in the liquidating distribution.

     Sale or Exchange of a Partner Certificate.

     If a Security Owner sells a Partner Certificate, the Security Owner will
recognize gain or loss equal to the difference between the amount realized on
the sale and the Security Owner's adjusted basis in the Partner Certificate at
the time of sale. Generally, except to the extent provided otherwise in the
applicable prospectus supplement, any gain or loss will be capital gain or loss.

     Section 708 Terminations.

     Under Section 708 of the Code, the trust will be deemed to have terminated
for federal income tax purpose if 50 percent of the capital and profits
interests in the trust are sold or exchanged within a 12-month period. If a
termination were to occur, it would result in the deemed contribution by the
trust of its assets to a newly formed trust in exchange for interests in such
newly formed trust, which the terminated trust would be deemed to distribute to
the Security Owners. The series of deemed transactions would not result in
recognition of gain or loss to the trust or to the Security Owners. If the
Partner Certificates are Book Entry Certificates, the trust most likely will not
be able to comply with the termination provisions of Section 708 of the Code due
to lack of information concerning the transfer of interests in the trust.


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     Section 754 Election.

     If a Security Owner were to sell its Partner Certificate at a profit
(loss), the purchaser would have a higher (lower) adjusted basis in the
Certificate than did the seller. The trust's adjusted basis in its assets would
not be adjusted to reflect this difference unless the trust made an election
under Section 754 of the Code. To avoid the administrative complexities that
would be involved if such an election were to be made, a trust that is
classified as a partnership will not make an election under Section 754 of the
Code unless otherwise provided in the applicable prospectus supplement. As a
result, a beneficial owner of a Partner Certificate might be allocated a greater
or lesser amount of partnership income than would be appropriate based on its
own purchase price for its Partner Certificate.

     Foreign Persons.

     Unless otherwise provided in the applicable prospectus supplement, income
allocated and distributions made by the trust to a Security Owner who is a
Foreign Person will be subject to United States federal income tax and
withholding tax, if the income attributable to a security is not effectively
connected with the conduct of a trade or business within the United States by
the Foreign Person.

     Any capital gain realized on the sale, redemption, retirement or other
taxable disposition of a beneficial interest in a Partner Certificate by a
Foreign Person will be exempt from United States federal income and withholding
tax, provided that (i) such gain is not effectively connected with the conduct
of a trade or business in the United States by the Foreign Person and (ii) in
the case of an individual, the individual is not present in the United States
for 183 days or more in the taxable year.

     Information Reporting.

     Each trust classified as a partnership will file a partnership tax return
on IRS Form 1065 with the IRS for each taxable year of the trust. The trust will
report each Security Owner's allocable share of the trust's items of income and
expense to the Security Owner and to the IRS on Schedules K-1. The trust will
provide the Schedules K-1 to nominees that fail to provide the trust with the
information statement described below and the nominees then will be required to
forward that information to the beneficial owners of the Partner Certificates.
Generally, a Security Owner must file tax returns that are consistent with the
information reported on the Schedule K-1 or be subject to penalties, unless the
Security Owner notifies the IRS of the inconsistencies.

     Under Section 6031 of the Code, any person that holds a Partner Certificate
as a nominee at any time during a calendar year is required to furnish to the
trust a statement containing certain information concerning the nominee and the
beneficial owner of the Partner Certificates. In addition, brokers and financial
institutions that hold Partner Certificates through a nominee are required to
furnish directly to the trust information as to the beneficial ownership of the
Partner Certificates. The information referred to above for any calendar year is
to be provided to the trust by January 31 of the following year. Brokers and
nominees who fail to provide the information may be subject to penalties.
However, a clearing agency registered under Section 17A of the Securities
Exchange Act of 1934 is not required to furnish that information statement to
the trust.

     Administrative Matters.

     Unless another designation is made, the depositor will be designated as the
tax matters partner in the trust agreement and, as the tax matters partner, will
be responsible for representing the beneficial owners of Partner Certificates 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
until three years after the date on which the partnership information return is
filed. Any adverse determination following an audit of the return of the
partnership by the appropriate taxing authorities could result in an adjustment
of the returns of the beneficial owners of Partner Certificates, and, under
certain circumstances, a beneficial owner may be precluded from separately
litigating a proposed adjustment to the items of the partnership. An adjustment
also could result in an audit of a beneficial owner's returns and adjustments of
items not related to the income and losses of the partnership.

SPECIAL TAX ATTRIBUTES

     In certain cases, securities are afforded special tax attributes under
particular sections of the Code, as discussed below.


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     REMIC Certificates.

     REMIC certificates held by a domestic building and loan association will
constitute "regular or residual interests in a REMIC" within the meaning of
Section 7701(a)(19)(C)(xi) of the Code in proportion to the assets of the REMIC
that are described in Section 7701(a)(19)(C)(i) through (x). If, however, at
least 95 percent of the assets of the REMIC are described in Section
7701(a)(19)(C)(i) through (x), the entire REMIC certificates in that REMIC will
so qualify.

     In addition, REMIC certificates held by a REIT will constitute "real estate
assets" within the meaning of Section 856(c)(5)(B) of the Code. If at any time
during a calendar year less than 95 percent of the assets of a REMIC consist of
"real estate assets," then the portion of the REMIC certificates that are real
estate assets under Section 856(c)(5)(B) during the calendar year will be
limited to the portion of the assets of the REMIC that are real estate assets.
Similarly, income on the REMIC certificates will be treated as "interest on
obligations secured by mortgages on real property" within the meaning of Section
856(c)(3)(B) of the Code, subject to the same limitation as set forth in the
preceding sentence.

     REMIC regular certificates also will be "qualified mortgages" within the
meaning of Section 860G(a)(3) of the Code with respect to other REMICs, provided
they are transferred to the other REMICs within the periods required by the
Code, and will be "permitted assets" within the meaning of Section 860L(c)(1) of
the Code with respect to FASITs.

     The determination as to the percentage of the REMIC's assets that
constitute assets described in the foregoing sections of the Code will be made
for each calendar quarter based on the average adjusted basis of each category
of the assets held by the REMIC during that calendar quarter. The REMIC will
report those determinations in the manner and at the times required by
applicable Treasury regulations. The Small Business Job Protection Act of 1996
(the "SBJPA of 1996") repealed the reserve method for bad debts of domestic
building and loan associations and mutual savings banks, and thus has eliminated
the asset category of "qualifying real property loans" in former Section 593(d)
of the Code for taxable years beginning after December 31, 1995. The
requirements in the SBJPA of 1996 that these institutions must "recapture" a
portion of their existing bad debt reserves is suspended if a certain portion of
their assets are maintained in "residential loans" under Section
7701(a)(19)(C)(v) of the Code, but only if those loans were made to acquire,
construct or improve the related real property and not for the purpose of
refinancing. However, no effort will be made to identify the portion of the
mortgage loans of any series meeting this requirement, and no representation is
made in this regard.

     The assets of the REMIC will include, in addition to mortgage loans,
payments on mortgage loans held pending distribution on the REMIC certificates
and property acquired by foreclosure held pending sale, and may include amounts
in reserve accounts. It is unclear whether property acquired by foreclosure held
pending sale and amounts in reserve accounts would be considered to be part of
the mortgage loans, or whether those assets (to the extent not invested in
assets described in the foregoing sections) otherwise would receive the same
treatment as the mortgage loans for purposes of all of the foregoing sections.
Under the regulations applicable to REITs, however, mortgage loan payments held
by a REMIC pending distribution are real estate assets for purposes of Section
856(c)(5)(B) of the Code. Furthermore, foreclosure property generally will
qualify as real estate assets under Section 856(c)(5)(B) of the Code.

     For some series of REMIC certificates, two or more separate elections may
be made to treat designated portions of the related trust fund as REMICs
("Tiered REMICs") for federal income tax purposes. Solely for purposes of
determining whether the REMIC certificates will be "real estate assets" within
the meaning of Section 856(c)(5)(B) of the Code and "loans secured by an
interest in real property" under Section 7701(a)(19)(C) of the Code, and whether
the income on those Certificates is interest described in Section 856(c)(3)(B)
of the Code, the Tiered REMICs will be treated as one REMIC.

     As described above, certain REMIC regular certificates will evidence
ownership of a REMIC regular interest and a notional principal contract, as
further described in the accompanying


                                      106


supplement. See "-- Types of Securities -- REMIC Certificates Generally" above.
Any such notional principal contract (and any income therefrom) will not be
afforded any of the special tax attributes described in this section.

     FASIT Regular Certificates.

     FASIT regular certificates held by a REIT will qualify as "real estate
assets" within the meaning of Section 856(c)(5)(B) of the Code, and interest on
such certificates will be considered "interest on obligations secured by
mortgages on real property" within the meaning of Section 856(c)(3)(B) of the
Code to the same extent that REMIC certificates would be so considered.
Likewise, FASIT regular certificates held by a domestic building and loan
association will represent qualifying assets for purposes of the qualification
requirements set forth in Section 7701(a)(19)(C) of the Code to the same extent
that REMIC certificates would be so considered. See "-- REMIC Certificates"
above.

     Non-REMIC and non-FASIT Debt Securities.

     Debt Securities that are not REMIC regular certificates or FASIT regular
certificates and that are owned by domestic building and loan associations and
other thrift institutions will not be considered "loans secured by an interest
in real property" or "qualifying real property loans." Moreover, such Debt
Securities owned by a REIT will not be treated as "real estate assets" nor will
interest on the Debt Securities be considered "interest on obligations secured
by mortgages on real property." In addition, such Debt Securities will not be
"qualified mortgages" for REMICs.

     Grantor Trust Certificates.

     Standard Certificates held by a domestic building and loan association will
constitute "loans secured by interests in real property" within the meaning of
Section 7701(a)(19)(C)(v) of the Code; Standard Certificates held by a REIT will
constitute "real estate assets" within the meaning of Section 856(c)(5)(B) of
the Code; amounts includible in gross income with respect to Standard
Certificates held by a REIT will be considered "interest on obligations secured
by mortgages on real property" within the meaning of Section 856(c)(3)(B) of the
Code; and Standard Certificates transferred to a REMIC within the prescribed
time periods will qualify as "qualified mortgages" within the meaning of Section
860G(a)(3) of the Code; provided in each case that the related assets of the
trust (or income therefrom, as applicable) would so qualify.

     Although there appears to be no policy reason not to accord to Stripped
Certificates the treatment described above for Standard Certificates, there is
no authority addressing such characterization for instruments similar to
Stripped Certificates. We recommend that prospective investors in Stripped
Certificates consult their own tax advisers regarding the characterization of
Stripped Certificates, and the income therefrom, if the characterization of the
Stripped Certificates under the above-referenced rules is relevant.

     Partner Certificates.

     For federal income tax purposes, Partner Certificates held by a domestic
building and loan association will not constitute "loans secured by an interest
in real property" within the meaning of Code Section 7701(a)(19)(C)(v), but, for
purposes of the provisions applicable to REITs, a REIT holding a Partnership
Certificate will be deemed to hold its proportionate share of each of the assets
of the partnership and will be deemed to be entitled to the income of the
partnership attributable to such share, based in each case on the REIT's capital
interest in the issuer.

BACKUP WITHHOLDING

     Distributions on securities, as well as payment of proceeds from the sale
of securities, may be subject to the backup withholding tax under Section 3406
of the Code if recipients fail to furnish certain information, including their
taxpayer identification numbers, or otherwise fail to establish an exemption
from such tax. Any amounts deducted and withheld from a recipient would be
allowed as a credit against such recipient's federal income tax. Furthermore,
certain penalties may be imposed by the IRS on a recipient that is required to
supply information but that does not do so in the manner required.


                                      107


                      STATE AND LOCAL TAX CONSIDERATIONS

     In addition to the federal income tax consequences described above,
potential investors should consider the state and local income tax consequences
of the acquisition, ownership and disposition of securities. State and local
income tax law may differ substantially from the corresponding federal law, and
this discussion does not purport to describe any aspect of the income tax laws
of any state or locality.

     For example, a REMIC or FASIT or non-REMIC or non-FASIT trust may be
characterized as a corporation, a partnership, or some other entity for purposes
of state income tax law. Such characterization could result in entity level
income or franchise taxation of the trust. We recommend that potential investors
consult their own tax advisors with respect to the various state and local tax
consequences of an investment in securities.


                             ERISA CONSIDERATIONS
GENERAL

     The Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
and the Code impose certain requirements in connection with the investment of
plan assets 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 these
plans, accounts or arrangements are invested, that are subject to Title I of
ERISA or to Section 4975 of the Code ("Plans") and on persons who are
fiduciaries for those Plans. Some 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 Section 3(33) of
ERISA), are not subject to ERISA requirements. Therefore, assets of these plans
may be invested in Securities without regard to the ERISA considerations
described below, subject to the provisions of other applicable federal, state
and local law. Any of these plans that are qualified and exempt from taxation
under Sections 401(a) and 501(a) of the Code, however, are subject to the
prohibited transaction rules set forth in Section 503 of the Code.

     ERISA generally imposes on Plan fiduciaries certain general fiduciary
requirements, including those of investment prudence and diversification and the
requirement that a Plan's investments be made in accordance with the documents
governing the Plan. In addition, ERISA and the Code prohibit a broad range of
transactions involving assets of a Plan and persons ("Parties in Interest") who
have certain specified relationships to the Plan unless a statutory, regulatory
or administrative exemption is available. Certain Parties in Interest that
participate in a prohibited transaction may be subject to excise taxes imposed
pursuant to Section 4975 of the Code, unless a statutory, regulatory or
administrative exemption is available. These prohibited transactions generally
are set forth in Sections 406 and 407 of ERISA and Section 4975 of the Code.

     A Plan's investment in Securities may cause the Primary Assets and other
assets included in a related trust fund to be deemed Plan assets. The United
States Department of Labor ("DOL") has issued regulations set forth at 29 C.F.R.
Section 2510.3-101 (the "DOL Regulations") which provide that when a Plan
acquires an equity interest in an entity, the Plan's assets include both the
equity interest and an undivided interest in each of the underlying assets of
the entity, unless certain exceptions not applicable here apply, or unless the
equity participation in the entity by "benefit plan investors" (i.e., Plans,
employee benefit plans not subject to ERISA, and entities whose underlying
assets include plan assets by reason of a Plan's investment in the entity) is
not "significant," both as defined therein. For this purpose, in general, equity
participation by benefit plan investors will be "significant" on any date if 25%
or more of the value of any class of equity interests in the entity is held by
benefit plan investors. To the extent the Securities are treated as equity
interests for purposes of the DOL Regulations, equity participation in a trust
fund will be significant on any date if immediately after the most recent
acquisition of any Security, 25% or more of any class of Securities is held by
benefit plan investors.

     Any person who has discretionary authority or control respecting the
management or disposition of assets of a Plan, and any person who provides
investment advice for those assets for a fee, is a


                                      108


fiduciary of the Plan. If the Primary Assets and other assets included in a
trust fund constitute plan assets of an investing Plan, then any party
exercising management or discretionary control regarding those assets, such as
the servicer or master servicer, may be deemed to be a "fiduciary" of the Plan
and thus subject to the fiduciary responsibility provisions and prohibited
transaction provisions of ERISA and the Code with respect to the investing
Plan. In addition, if the Primary Assets and other assets included in a trust
fund constitute plan assets, certain activities involved in the operation of
the trust fund may constitute or involve prohibited servicing, sales or
exchanges of property or extensions of credit transactions under ERISA and the
Code.

THE UNDERWRITER EXEMPTION

     The DOL issued an individual exemption to Lehman Brothers Inc.'s
predecessor in interest, Shearson Lehman Hutton Inc. (Prohibited Transaction
Exemption ("PTE") 91-14 et al.; 56 Fed. Reg. 7413 (1991) as most recently
amended and restated by PTE 2002-41, 67 Fed. Reg. 54487 (2002)) (the
"Exemption") that generally exempts from the application of the prohibited
transaction provisions of Sections 406(a) and 407(a) of ERISA, and the excise
taxes imposed on those prohibited transactions pursuant to Sections 4975(a) and
(b) of the Code, certain transactions relating to the servicing and operation of
mortgage pools and the purchase (in both the initial offering and secondary
market), sale and holding of Securities underwritten by an underwriter, as
defined below, that (1) represent a beneficial ownership interest in the assets
of an issuer which is a trust and entitle the holder to pass-through payments of
principal, interest and/or other payments made with respect to the assets of the
trust fund or (2) are denominated as a debt instrument and represent an interest
in or issued by the issuer, provided that certain conditions set forth in the
Exemption are satisfied.

     For purposes of this Section "ERISA Considerations," the term "underwriter"
will include (a) Lehman Brothers Inc., (b) any person directly or indirectly,
through one or more intermediaries, controlling, controlled by or under common
control with Lehman Brothers Inc., and (c) any member of the underwriting
syndicate or selling group of which a person described in (a) or (b) is a
manager or co-manager for a class of Securities.

     Among the general conditions that must be satisfied for exemptive relief
under the Exemption are:

     (1) The acquisition of Securities by a Plan must be 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 Securities at the time of acquisition by the Plan must be rated in
     one of the three highest generic rating categories (four, in a Designated
     Transaction) by Standard & Poor's Ratings Services, a division of The
     McGraw-Hill Companies, Inc. ("S&P"), Moody's Investors Service, Inc.
     ("Moody's") or Fitch Ratings ("Fitch") (each, a "Rating Agency");

     (3) In the case of a transaction described in the Exemption as a designated
     transaction (a "Designated Transaction"), in which the investment pool
     contains only certain types of assets such as the Primary Assets which are
     fully secured, the Exemption covers subordinated Securities issued by the
     trust fund in such transaction which are rated in one of the four highest
     generic rating categories by a Rating Agency. The Exemption also applies to
     Securities backed by residential and home equity loans that are less than
     fully secured, provided that (1) the rights and interests evidenced by the
     Securities are not subordinated to the rights and interests evidenced by
     the other securities of the trust fund, (2) the Securities are rated in
     either of the two highest generic rating categories by a Rating Agency and
     (3) any loan included in the investment pool is secured by collateral whose
     fair market value on the closing date of the transaction is at least equal
     to 80% of the sum of (a) the outstanding principal balance due under the
     loan which is held by the trust fund and (b) the outstanding principal
     balance(s) of any other loan(s) of higher priority (whether or not held by
     the trust fund) which are secured by the same collateral;

     (4) Assets of the type included in a particular trust fund have been
     included in other investment pools and securities evidencing interests in
     such other pools have been both (i) rated in one of


                                      109


     the three (or in the case of a Designated Transaction, four) highest
     generic rating categories by a Rating Agency and (ii) been purchased by
     investors other than Plans for at least one year prior to a Plan's
     acquisition of Securities in reliance on the Exemption;

     (5) The trustee may not be an affiliate of any other member of the
     Restricted Group, as defined below, other than any underwriter;

     (6) The sum of all payments made to and retained by the underwriter(s) must
     represent not more than reasonable compensation for underwriting the
     Securities; the sum of all payments made to and retained by the depositor
     pursuant to the assignment of the assets to the issuer must represent not
     more than the fair market value of those obligations; and the sum of all
     payments made to and retained by the master servicer and any other servicer
     must represent not more than reasonable compensation for that person's
     services under the related Agreement and reimbursement of that person's
     reasonable expenses in connection therewith;

     (7) The Plan investing in the Securities must be an accredited investor as
     defined in Rule 501(a)(1) of Regulation D of the Commission under the
     Securities Act of 1933, as amended; and

     (8) For certain types of issuers, the documents establishing the issuer and
     governing the transaction must contain provisions intended to protect the
     assets of the issuer from creditors of the depositor.

     The rating of a Security may change. If the rating of a Security declines
below the lowest permitted rating, the Security will no longer be eligible for
relief under the Exemption (although a Plan that had purchased the Security when
the Security had a permitted rating would not be required by the Exemption to
dispose of it). Consequently, only Plan investors that are insurance company
general accounts would be permitted to purchase the Securities in such
circumstances pursuant to Section I and III of Prohibited Transaction Class
Exemption ("PTCE") 95-60.

     The Exemption permits interest-rate swaps and yield supplement agreements
to be assets of the trust fund subject to certain conditions. An interest-rate
swap (or if purchased by or on behalf of the trust fund) an interest-rate cap
contract (collectively, a "Swap" or "Swap Agreement") is a permitted trust fund
asset if it:

     (1) is an "eligible Swap;"

     (2) is with an "eligible counterparty;"

     (3) is purchased by a "qualified plan investor;"

     (4) meets certain additional specific conditions which depend on whether
     the Swap is a "ratings dependent Swap" or a "non-ratings dependent Swap;"
     and

     (5) permits the trust fund to make termination payments to the Swap (other
     than currently scheduled payments) solely from excess spread or amounts
     otherwise payable to the servicer or depositor.

     An "eligible Swap" is one which:

     a. is denominated in U.S. dollars;

     b. pursuant to which the trust fund pays or receives, on or immediately
     prior to the respective payment or distribution date for the class of
     Securities to which the Swap relates, a fixed rate of interest or a
     floating rate of interest based on a publicly available index (e.g., LIBOR
     or the U.S. Federal Reserve's Cost of Funds Index (COFI)), with the trust
     fund receiving such payments on at least a quarterly basis and obligated to
     make separate payments no more frequently than the counterparty, with all
     simultaneous payments being netted ("Allowable Interest Rate");

     c. has a notional amount that does not exceed either: (i) the principal
     balance of the class of Securities to which the Swap relates, or (ii) the
     portion of the principal balance of such class represented by Primary
     Assets ("Allowable Notional Amount");

                                      110


     d. is not leveraged (i.e., payments are based on the applicable notional
     amount, the day count fractions, the fixed or floating rates permitted
     above, and the difference between the products thereof, calculated on a
     one-to-one ratio and not on a multiplier of such difference) ("Leveraged");

     e. has a final termination date that is either the earlier of the date on
     which the issuer terminates or the related class of Securities are fully
     repaid; and

     f. does not incorporate any provision that could cause a unilateral
     alteration in the interest rate requirements described above or the
     prohibition against leveraging.

     An "eligible counterparty" means a bank or other financial institution
which has a rating at the date of issuance of the Securities, which is in one of
the three highest long term credit rating categories or one of the two highest
short term credit rating categories, utilized by at least one of the Rating
Agencies rating the Securities; provided that, if a counterparty is relying on
its short term rating to establish eligibility hereunder, such counterparty must
either have a long term rating in one of the three highest long term rating
categories or not have a long term rating from the applicable Rating Agency.

     A "qualified plan investor" is a Plan or Plans where the decision to buy
such class of Securities is made on behalf of the Plan by an independent
fiduciary qualified to understand the Swap transaction and the effect the Swap
would have on the rating of the Securities and such fiduciary is either:

     a. a "qualified professional asset manager" ("QPAM") under PTCE 84-14;

     b. an "in-house asset manager" under PTCE 96-23; or

     c. has total assets (both Plan and non-Plan) under management of at least
     $100 million at the time the Securities are acquired by the Plan.

     In "ratings dependent Swaps" (where the rating of a class of Securities is
dependent on the terms and conditions of the Swap), the Swap Agreement must
provide that if the credit rating of the counterparty is withdrawn or reduced
by any Rating Agency below a level specified by the Rating Agency, the servicer
must, within the period specified under the pooling and servicing agreement:

     a. obtain a replacement Swap Agreement with an eligible counterparty which
     is acceptable to the Rating Agency and the terms of which are substantially
     the same as the current Swap Agreement (at which time the earlier Swap
     Agreement must terminate); or

     b. cause the Swap counterparty to establish any collateralization or other
     arrangement satisfactory to the Rating Agency such that the then current
     rating by the Rating Agency of the particular class of Securities will not
     be withdrawn or reduced (and the terms of the Swap Agreement must
     specifically obligate the counterparty to perform these duties for any
     class of Securities with a term of more than one year).

     In the event that the servicer fails to meet these obligations, Plan
securityholders must be notified in the immediately following periodic report,
which is provided to securityholders, but in no event later than the end of the
second month beginning after the date of such failure. Sixty days after the
receipt of such report, the exemptive relief provided under the Exemption will
prospectively cease to be applicable to any class of Securities held by a Plan
which involves such ratings dependent Swap.

     "Non-ratings dependent Swaps" (those where the rating of the Securities
does not depend on the terms and conditions of the Swap) are subject to the
following conditions. If the credit rating of the counterparty is withdrawn or
reduced below the lowest level permitted above, the servicer will, within a
specified period after such rating withdrawal or reduction:

     a. obtain a replacement Swap Agreement with an eligible counterparty, the
     terms of which are substantially the same as the current Swap Agreement (at
     which time the earlier Swap Agreement must terminate);

     b. cause the counterparty to post collateral with the trust in an amount
     equal to all payments owed by the counterparty if the Swap transaction were
     terminated; or


                                      111


     c. terminate the Swap Agreement in accordance with its terms.

     An "eligible yield supplement agreement" is any yield supplement agreement
or similar arrangement (or if purchased by or on behalf of the trust fund) an
interest rate cap contract to supplement the interest rates otherwise payable
on obligations held by the trust fund ("EYS Agreement"). If the EYS Agreement
has a notional principal amount and/or is written on an International Swaps and
Derivatives Association, Inc. (ISDA) form, the EYS Agreement may only be held
as an asset of the trust fund with respect to Securities purchased by Plans if
it meets the following conditions:

     a. it is denominated in U.S. dollars;

     b. it pays an Allowable Interest Rate;

     c. it is not Leveraged;

     d. it does not allow any of these three preceding requirements to be
     unilaterally altered without the consent of the trustee;

     e. it is entered into between the trust fund and an eligible counterparty;
     and

     f. it has an Allowable Notional Amount.

     The Exemption permits transactions using a Pre-Funding Account whereby a
portion of the Primary Assets are transferred to the trust fund within a
specified period following the closing date ("DOL Pre-Funding Period") instead
of requiring that all such Primary Assets be either identified or transferred
on or before the closing date, provided that the DOL Pre-Funding Period
generally ends no later than three months or 90 days after the closing date,
the ratio of the amount allocated to the Pre-Funding Account to the total
principal amount of the Securities being offered generally does not exceed
twenty-five percent (25%) and certain other conditions set forth in the
Exemption are satisfied.

     If the general conditions of the Exemption are satisfied, the Exemption may
provide an exemption from the restrictions imposed by Sections 406(a) and 407(a)
of ERISA (as well as the related excise taxes imposed by Section 4975 of the
Code) in connection with the direct or indirect sale, exchange, transfer,
holding or the direct or indirect acquisition or disposition in the secondary
market of Securities by Plans and the servicing, management and operation of the
trust fund. A fiduciary of a Plan contemplating purchasing a Security should
make its own determination that the general conditions set forth above will be
satisfied for that Security.

     The Exemption also may provide an exemption from the restrictions imposed
by Sections 406(a) and 407 of ERISA, and the excise taxes imposed by Section
4975 of the Code, if those restrictions are deemed to otherwise apply merely
because a person is deemed to be a "party in interest" with respect to an
investing Plan by virtue of providing services to the Plan (or by virtue of
having certain specified relationships to that person) solely as a result of the
Plan's ownership of Securities.

     The Exemption also provides relief from certain self-dealing/conflict of
interest prohibited transactions that may arise under Sections 406(b)(1) and
406(b)(2) of ERISA (as well as from the excise taxes imposed by Section 4975 of
the Code) when a fiduciary causes a Plan to invest in an issuer that holds
obligations on which the fiduciary (or its affiliate) is an obligor only if,
among other requirements: (1) the fiduciary (or its affiliate) is an obligor
with respect to no more than 5% of the fair market value of the obligations
contained in the trust fund; (2) the Plan's investment in each class of
Securities does not exceed 25% of all of the Securities of that class
outstanding at the time of the acquisition; (3) immediately after the
acquisition, no more than 25% of the assets of any Plan for which the fiduciary
serves as a fiduciary are invested in securities representing an interest in one
or more trusts containing assets sold or serviced by the same entity; (4) in the
case of an acquisition of Securities in connection with their initial issuance,
at least 50% of each class of Securities in which Plans have invested and at
least 50% of the aggregate interest in the issuer is acquired by persons
independent of the Restricted Group; and (5) the Plan is not an Excluded Plan.
An "Excluded Plan" is one that is sponsored by a member of the Restricted Group,
which consists of the trustee, each underwriter, any insurer of the issuer, the
depositor, each servicer, any obligor with respect to


                                      112


obligations included in the issuer constituting more than 5% of the aggregate
unamortized principal balance of the assets of the issuer on the date of the
initial issuance of Securities, each counterparty in any eligible swap
transactions and any affiliate of any such persons.

     However, no exemption is provided from the restrictions of Sections
406(a)(1)(E), 406(a)(2) and 407 of ERISA for the acquisition or holding of a
Security on behalf of an Excluded Plan by any person who has discretionary
authority or renders investment advice with respect to the assets of that
Excluded Plan.

ADDITIONAL CONSIDERATIONS FOR SECURITIES WHICH ARE NOTES

     Without regard to whether Securities are treated as equity interests for
purposes of the DOL Regulations, because any of the depositor, the trustee, any
underwriter, the issuer or any of their affiliates might be considered or might
become Parties in Interest with respect to a Plan, the acquisition or holding of
Securities which are considered debt without substantial equity features by or
on behalf of that Plan could be considered to give rise to both direct and
indirect prohibited transactions within the meaning of ERISA and the Code,
unless one or more statutory, regulatory or administrative exemptions are
applicable. Included among such exemptions are: the 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. It should be noted, however, that even if
the conditions specified in one or more of these exemptions are met, the scope
of relief provided may not necessarily cover all acts that might be construed as
prohibited transactions.

ADDITIONAL FIDUCIARY CONSIDERATIONS

     The depositor, the master servicer, the servicer, the trustee or any
underwriter may be the sponsor of, or investment advisor with respect to, one or
more Plans. Because these parties may receive certain benefits in connection
with the sale of Securities, the purchase of Securities using Plan assets over
which any of these parties has investment discretion or management 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. Accordingly, Securities
should not be purchased using the assets of any Plan if any of the depositor,
any servicer, the trustee or any underwriter or any of their affiliates has
investment discretion or management authority for those assets, or is an
employer maintaining or contributing to the Plan, if such acquisition would
constitute a non-exempt prohibited transaction.

     Any Plan fiduciary that proposes to cause a Plan to purchase Securities
should consult with its counsel with respect to the potential applicability of
ERISA and the Code to that investment, the availability of the exemptive relief
provided in the Exemption and the potential applicability of any other
prohibited transaction exemption in connection therewith. In particular, a Plan
fiduciary that proposes to cause a Plan to purchase Securities representing a
beneficial ownership interest in a pool of single-family residential first
mortgage loans should consider the applicability of PTCE 83-1, which provides
exemptive relief for certain transactions involving mortgage pool investment
trusts. The prospectus supplement for a series of Securities may contain
additional information regarding the application of the Exemption, PTCE 83-1 or
any other exemption, with respect to the Securities offered thereby.

     Any Plan fiduciary considering whether to purchase a Security on behalf of
a Plan should consult with its counsel regarding the application of the DOL
Regulations and the fiduciary responsibility and prohibited transaction
provisions of ERISA and the Code to that investment.

     The sale of Securities to a Plan is in no respect a representation by the
depositor or the underwriter that the investment meets all relevant legal
requirements for investments by Plans generally or any particular Plan, or that
the investment is appropriate for Plans generally or any particular Plan.


                                      113


                        LEGAL INVESTMENT CONSIDERATIONS

     The prospectus supplement for each series of Securities will specify which,
if any, of the classes of Offered Securities will constitute "mortgage related
securities" for purposes of the Secondary Mortgage Market Enhancement Act of
1984, as amended ("SMMEA"). Classes of Securities that qualify as "mortgage
related securities" will be legal investments for persons, trusts, corporations,
partnerships, associations, business trusts and business entities (including
depository institutions, life insurance companies and pension funds) created
pursuant to or existing under the laws of the United States or of any state
(including the District of Columbia and Puerto Rico) whose authorized
investments are subject to state regulation to the same extent as, under
applicable law, obligations issued by or guaranteed as to principal and interest
by the United States or any of these entities. Under SMMEA, if a state enacted
legislation prior to October 4, 1991 specifically limiting the legal investment
authority of any such entities with respect to "mortgage related securities,"
the Securities will constitute legal investments for entities subject to this
legislation only to the extent provided therein. Approximately twenty-one states
adopted the legislation prior to the October 4, 1991 deadline.

     SMMEA also amended the legal investment authority of federally-chartered
depository institution as follows: federal savings and loan associations and
federal savings banks may invest in, sell or otherwise deal in Securities
without limitations as to the percentage of their assets represented thereby,
federal credit unions may invest in mortgage related securities, and national
banks may purchase Securities for their own account without regard to the
limitations generally applicable to investment securities set forth in 12 U.S.C.
Section 24 (Seventh), subject in each case to any regulations the applicable
federal authority may prescribe. In this connection, federal credit unions
should review the National Credit Union Administration ("NCUA") Letter to Credit
Unions No. 96, as modified by Letter to Credit Unions No. 108, which includes
guidelines to assist federal credit unions in making investment decisions for
mortgage related securities, and the NCUA's regulation "Investment and Deposit
Activities" (12 C.F.R. Part 703), (whether or not the class of Securities under
consideration for purchase constitutes a "mortgage related security").

     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 Securities
Activities (to the extent adopted by their respective regulators) (the "Policy
Statement"), setting forth, in relevant part, certain securities trading and
sales practices deemed unsuitable for an institution's investment portfolio, and
guidelines for (and restrictions on) investing in mortgage derivative products,
including "mortgage related securities" that are "high-risk mortgage securities"
as defined in the Policy Statement. According to the Policy Statement,
"high-risk mortgage securities" include securities such as the Securities not
entitled to distributions allocated to principal or interest, or Subordinated
Securities. Under the Policy Statement, it is the responsibility of each
depository institution to determine, prior to purchase (and at stated intervals
thereafter), whether a particular mortgage derivative product is a "high-risk
mortgage security," and whether the purchase (or retention) of the product would
be consistent with the Policy Statement.

     The foregoing does not take into consideration the applicability of
statutes, rules, regulations, orders, guidelines, or agreements generally
governing investments made by a particular investor, including, but no limited
to, "prudent investor" provisions, percentage-of-assets limits and provisions
that may restrict or prohibit investment in securities that are not "interest
bearing" or "income paying."

     There may be other restrictions on the ability of certain investors,
including depository institutions, either to purchase Securities or to purchase
Securities representing more than a specified percentage of the investor's
assets. Investors should consult their own legal advisors in determining whether
and to what extent the Securities constitute legal investments for these
investors.

                                 LEGAL MATTERS

     Certain legal matters in connection with the Offered Securities will be
passed upon for the depositor and for the Underwriters, and the material federal
income tax consequences of the


                                      114


Securities will be passed upon for the depositor, by McKee Nelson LLP,
Washington, D.C. or by Dechert LLP, New York, New York as specified in the
prospectus supplement for each series of Securities.

                                 THE DEPOSITOR

     The depositor, Structured Asset Securities Corporation, was incorporated in
the State of Delaware on January 2, 1987. The principal office of the depositor
is located at 745 Seventh Avenue, New York, New York 10019. Its telephone number
is (212) 526-7000.

     The Certificate of Incorporation of the depositor provides that the
depositor may not conduct any activities other than those related to the issue
and sale of one or more series and to serve as depositor of one or more trusts
that may issue and sell bonds or securities. The Certificate of Incorporation of
the depositor provides that any securities, except for subordinated securities,
issued by the depositor must be rated in one of the three highest categories
available by any Rating Agency rating the series.

     The series Supplement for a particular series may permit the Primary Assets
pledged to secure the related series of Securities to be transferred by the
Issuer to a trust, subject to the obligations of the Securities of that series,
thereby relieving the Issuer of its obligations with respect to the Securities.

                                USE OF PROCEEDS

     The depositor will apply all or substantially all of the net proceeds from
the sale of each series offered hereby and by the prospectus supplement to
purchase the Primary Assets, to repay indebtedness that has been incurred to
obtain funds to acquire the Primary Assets, to establish the Reserve Funds, if
any, for the series and to pay costs of structuring and issuing the Securities.
If specified in the prospectus supplement, Securities may be exchanged by the
depositor for Primary Assets. Unless otherwise specified in the prospectus
supplement, the Primary Assets for each series of Securities will be acquired by
the depositor either directly, or through one or more affiliates that will have
acquired the Primary Assets from time to time either in the open market or in
privately negotiated transactions.

                             PLAN OF DISTRIBUTION

     Each series of Securities offered hereby and by means of the prospectus
supplements may be offered through any one or more of the following: Lehman
Brothers Inc., an affiliate of the depositor; underwriting syndicates
represented by Lehman Brothers Inc.; any originator of Loans underlying a
series; or underwriters, agents or dealers selected by the originator
(collectively, the "Underwriters"). The prospectus supplement with respect to
each series of Securities will set forth the terms of the offering of the series
of Securities and each class within the series, including the name or names of
the Underwriters (if known), the proceeds to the depositor (if any), and
including either the initial public offering price, the discounts and
commissions to the Underwriters and any discounts or commissions allowed or
reallowed to certain dealers, or the method by which the prices at which the
Underwriters will sell the Securities will be determined.

     The Underwriters may or may not be obligated to purchase all of the
Securities of a series described in the prospectus supplement with respect to
the series if any Securities are purchased. The Securities may be acquired by
the Underwriters for their own account and may be resold from time to time in
one or more transactions, including negotiated transactions, at a fixed public
offering price or at varying prices determined at the time of sale.

     If so indicated in the prospectus supplement, the depositor will authorize
Underwriters or other persons acting as the depositor's agents to solicit offers
by certain institutions to purchase the Securities from the depositor pursuant
to contracts providing for payment and delivery on a future date. Institutions
with which these contracts may be made include commercial and savings banks,
insurance companies, pension funds, investment companies, educational and
charitable institutions and


                                      115


others, but in all cases these institutions must be approved by the depositor.
The obligation of any purchaser under the contract will be subject to the
condition that the purchase of the offered Securities will not at the time of
delivery be prohibited under the laws of the jurisdiction to which the purchaser
is subject. The Underwriters and any other agents will not have any
responsibility in respect of the validity or performance of the contracts.

     The depositor may also sell the Securities offered hereby and by means of
the prospectus supplements from time to time in negotiated transactions or
otherwise, at prices determined at the time of sale. The depositor may effect
the transactions by selling Securities to or through dealers and the dealers may
receive compensation in the form of underwriting discounts, concessions or
commissions from the depositor and any purchasers of Securities for whom they
may act as agents.

     The place and time of delivery for each series of Securities offered hereby
and by means of the prospectus supplement will be set forth in the prospectus
supplement with respect to the series.

     In the ordinary course of business, Lehman Brothers Inc. or other
Underwriters, or their respective affiliates, may engage in various securities
and financing transactions, including loans or repurchase agreements to provide
interim financing of mortgage loans pending the sale of the mortgage loans or
interests therein, including the Securities.

                            ADDITIONAL INFORMATION

     The depositor has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement under the Securities Act of 1933, as
amended, with respect to the Securities. This prospectus, which forms a part of
the Registration Statement, omits certain information contained in the
Registration Statement pursuant to the Rules and Regulations of the Commission.
The Registration Statement and the exhibits thereto can be inspected and copied
at the public reference facilities maintained by the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549.

     Copies of these materials can also be obtained from the Public Reference
Section of the Commission, 450 Fifth Street, N.W., Washington, D.C. 20549, at
prescribed rates. The Commission also maintains a site on the World Wide Web at
"http://www.sec.gov" at which users can view and download copies of reports,
proxy and information statements and other information filed electronically
through the Electronic Data Gathering, Analysis and Retrieval ("EDGAR") system.
The Seller has filed the Registration Statement, including all exhibits thereto,
through the EDGAR system and therefore these materials should be available by
logging onto the Commission's Web site. The Commission maintains computer
terminals providing access to the EDGAR system at each of the offices referred
to above.

     Copies of the most recent Fannie Mae Prospectus for Fannie Mae certificates
and Fannie Mae's annual report and quarterly financial statements as well as
other financial information are available from the Director of Investor
Relations of Fannie Mae, 3900 Wisconsin Avenue, N.W., Washington, D.C. 20016
((202) 752-7115). Fannie Mae also maintains a site on the World Wide Web at
http:///www.fanniemae.com at which users can view certain information, including
Fannie Mae Prospectuses. The depositor did not participate in the preparation of
Fannie Mae's Prospectus or its annual or quarterly reports or other financial
information and, accordingly, makes no representation as to the accuracy or
completeness of the information set forth therein.

     Copies of the most recent Offering Circular for Freddie Mac certificates as
well as Freddie Mac's most recent Information Statement and Information
Statement Supplement and any quarterly report made available by Freddie Mac can
be obtained by writing or calling the Investor Inquiry department of Freddie Mac
at 1551 Park Run Drive, Mailstop D5B, McLean, Virginia 22102-3110 (outside
Washington, D.C. metropolitan area, telephone (800) 336-3672; within Washington,
D.C. metropolitan area, telephone (571) 382-4000). Freddie Mac also maintains a
site on the World Wide Web at http:///www.freddiemac.com at which users can view
certain information, including Freddie Mac Offering Circulars. The depositor did
not participate in the preparation of Freddie Mac's Offering Circular,
Information Statement or any supplement thereto or any quarterly report thereof
and, accordingly, makes no representations as to the accuracy or completeness of
the information set forth therein.


                                      116


                INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

     All documents filed by or on behalf of the trust fund referred to in the
accompanying prospectus supplement with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), after the date of this prospectus and prior to the
termination of any offering of the Securities issued by the trust fund,
including market making transactions by Lehman Brothers Inc., an affiliate of
the Depositor and Aurora Loan Services Inc., with respect to such Securities
(unless such transactions are exempt from the registration provisions of the
Securities Act), will be incorporated by reference in this prospectus and will
be deemed to be a part of this prospectus from the date of the filing of the
documents. Any statement contained in a document incorporated or deemed to be
incorporated by reference herein will be deemed to be modified or superseded for
all purposes of this prospectus to the extent that a statement contained herein
(or in the accompanying prospectus supplement) or in any other subsequently
filed document that also is or is deemed to be incorporated by reference
modifies or replaces the statement. Any statement so modified or superseded will
not be deemed, except as so modified or superseded, to constitute a part of this
prospectus.

     The trustee on behalf of any trust fund will provide without charge to each
person to whom this prospectus is delivered, on the written or oral request of
that person, a copy of any or all of the documents referred to above that have
been or may be incorporated by reference in this prospectus (not including
exhibits to the information that is incorporated by reference unless 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 specified in the accompanying prospectus supplement.

                          REPORTS TO SECURITYHOLDERS

     Periodic and annual reports concerning the related trust fund are required
under the Agreements to be forwarded to securityholders. Unless otherwise
specified in the prospectus supplement, the reports will not be examined and
reported on by an independent public accountant. See "The Agreements -- Reports
to Securityholders."


                                      117


                             INDEX OF DEFINED TERMS


                                                                            PAGE
                                                                            ----
1986 Act .................................................................    88
accrual class ............................................................    89
Adjustable Rate Mortgages ................................................    25
AFR ......................................................................    85
Agency Certificates ......................................................    15
Aggregate Asset Principal Balance ........................................     5
Agreements ...............................................................    58
Allowable Interest Rate ..................................................   110
Allowable Notional Amount ................................................   110
Appraised Value ..........................................................    25
ARMs .....................................................................    25
Asset Group ..............................................................     2
Asset Principal Balance ..................................................     5
Assistance Loans .........................................................    14
bankruptcy bond ..........................................................    57
Bankruptcy Code ..........................................................    47
Beneficial Owner .........................................................     6
Bi-Weekly Loans ..........................................................    23
Book-Entry Securities ....................................................     2
Business Day .............................................................    67
Buydown ..................................................................    54
Buy-Down Amounts .........................................................    25
Buy-Down Fund ............................................................    37
Buy-Down Loans ...........................................................    25
Buy-Down Mortgage Rate ...................................................    25
Buy-Down Period ..........................................................    25
Cash Program .............................................................    19
CERCLA ...................................................................    79
Certificateholders .......................................................     7
Certificates .............................................................     2
Clearstream ..............................................................     5
Code .....................................................................    85
Collection Account .......................................................    35
Commission ...............................................................   116
Company Counsel ..........................................................    85
Compound Interest Securities .............................................     2
Compound Value ...........................................................     4
Condominium ..............................................................    23
Condominium Association ..................................................    33
Condominium Building .....................................................    33
Condominium Loans ........................................................    23
Condominium Unit .........................................................    23
constant yield election ..................................................    92
Conventional Loans .......................................................    17
Cooperative Corporation ..................................................     7
Cooperative Dwellings ....................................................    23
Cooperative Loans ........................................................    23
Cooperatives .............................................................    23
Covered Trust ............................................................    46
CPR ......................................................................    11
CSSF .....................................................................     6
Cut-off Date .............................................................    14
Debt Securities ..........................................................    88
Deferred Interest ........................................................    12
Definitive Securities ....................................................     2
Deleted Loan .............................................................    61
Designated Transaction ...................................................   109
Distribution Account .....................................................    67
DOL ......................................................................   108
DOL Pre-Funding Period ...................................................   112
DOL Regulations ..........................................................   108
DTC ......................................................................     5
Due Date .................................................................    39
EDGAR ....................................................................   116
Eligible Investments .....................................................    63
Eligible Reserve Fund Investments ........................................    63
EPA ......................................................................    79
ERISA ....................................................................   108
Escrow Accounts ..........................................................    35
Euroclear ................................................................     5
Euroclear Operator .......................................................     7
European Depositaries ....................................................     7
Exchange Act .............................................................   117
Excluded Plan ............................................................   112
Exemption ................................................................   109
Expense Reserve Fund .....................................................    67
EYS Agreement ............................................................   112
Fannie Mae ...............................................................    18
FASIT ....................................................................    86
FASIT regular certificates ...............................................    86
FHA ......................................................................    17
FHA Loans ................................................................    23
FHA/VA Claim Proceeds ....................................................    52
Financial Intermediary ...................................................     7
Fitch ....................................................................   109
Floating Rate Securities .................................................     2
Foreign Person ...........................................................    85
Freddie Mac ..............................................................    20
Freddie Mac Act ..........................................................    20
FSLIC ....................................................................    26
Garn-St. Germain Act .....................................................    79
GEM Loans ................................................................    23
Ginnie Mae ...............................................................    16
Ginnie Mae Servicers .....................................................    15
GPM Fund .................................................................    38
GPM Loans ................................................................    23
Grantor Trust ............................................................    88
Grantor Trust Certificates ...............................................    88


                                      118



                                                                            PAGE
                                                                            ----
Guarantor Program ........................................................    19
Guaranty Agreement .......................................................    15
High-Yield Interests .....................................................    87
Housing Act ..............................................................    17
HUD ......................................................................    21
Index ....................................................................    26
Indirect Participants ....................................................     6
Insurance Policies .......................................................    22
Insured Loss .............................................................    50
Interest Rate ............................................................     3
Interest Weighted Securities .............................................     2
IRS ......................................................................    85
L/C Bank .................................................................    48
L/C Percentage ...........................................................    48
Leveraged ................................................................   111
Lifetime Mortgage Rate Cap ...............................................    26
Liquidation Proceeds .....................................................    36
Loans ....................................................................    15
Loan-to-Value Ratio ......................................................    25
Manufactured Home ........................................................    27
Manufactured Home Loan Schedule ..........................................    60
Manufactured Home Loans ..................................................    27
market discount bond .....................................................    90
Maximum Mortgage Rate Adjustment .........................................    26
Minimum Mortgage Rate ....................................................    26
Minimum Principal Distribution Amount ....................................     4
Moody's ..................................................................   109
Mortgage Certificate Schedule ............................................    58
Mortgage Loan Schedule ...................................................    60
Mortgage Loans ...........................................................    23
Mortgage Rates ...........................................................    12
Mortgaged Property .......................................................    13
Multi-Class Series .......................................................     3
Multifamily Properties ...................................................    12
NCUA .....................................................................   114
Negatively Amortizing ARMs ...............................................    26
No-Bid ...................................................................    54
non-pro rata security ....................................................    91
Noteholders ..............................................................     7
Notes ....................................................................     2
Offered Securities .......................................................     2
OID ......................................................................    88
OID Regulations ..........................................................    88
outside reserve fund .....................................................    86
Ownership certificate ....................................................    86
PAC Method ...............................................................    89
PACs .....................................................................     2
Participants .............................................................     6
Participation Agreement ..................................................    15
Participation Certificate Schedule .......................................    60
Participation Certificates ...............................................    60
Parties in Interest ......................................................   108
Partner Certificates .....................................................    88
PC Pool ..................................................................    18
Percentage Interest ......................................................     3
Planned Amortization Certificates ........................................     2
Plans ....................................................................   108
PMBS Agreement ...........................................................    21
PMBS Issuer ..............................................................    21
PMBS Servicer ............................................................    21
PMBS Trustee .............................................................    21
Policy Statement .........................................................   114
Pre-Funding Account ......................................................    28
Pre-Funding Arrangement ..................................................    28
Primary Assets ...........................................................    14
Principal Distribution Amount ............................................     4
Principal Weighted Securities ............................................     2
Private Mortgage-Backed Securities .......................................    14
PTCE .....................................................................   110
PTE ......................................................................   109
QPAM .....................................................................   111
Qualified Insurer ........................................................    41
Qualified Stated Interest ................................................    89
Qualifying Substitute Mortgage Loan ......................................    61
Rating Agency ............................................................     4
RCRA .....................................................................    79
REIT .....................................................................    88
Relevant Depositary ......................................................     7
REMIC regular certificate ................................................    85
REMIC residual certificate ...............................................    86
REMICs ...................................................................    85
REO Property .............................................................    68
Residual Owner ...........................................................    86
Retained Interest ........................................................    14
Rules ....................................................................     8
SBJPA of 1996 ............................................................   106
Scheduled Payment ........................................................    12
Scheduled Principal ......................................................    19
secured creditor exclusion ...............................................    79
Securities ...............................................................     2
Security Owner ...........................................................    85
Seller ...................................................................    59
Senior Securities ........................................................     4
Servicing Account ........................................................    37
Servicing Agreements .....................................................    34
Single Family Property ...................................................    18
SMMEA ....................................................................   114
SPA ......................................................................    11
Standard Certificates ....................................................   101
Stripped Bond Rules ......................................................   101


                                      119


                                                                            PAGE
                                                                            ----
Stripped Certificates ....................................................   101
Subordinate Securities ...................................................     2
Subordinated Amount ......................................................    47
Subordination Reserve Fund ...............................................    47
Subsequent Primary Assets ................................................    28
Subservicers .............................................................    34
Subsidy Fund .............................................................    38
super-premium class ......................................................    89
Swap .....................................................................   110
Swap Agreement ...........................................................   110
S&P ......................................................................   109
Terms and Conditions .....................................................     7
Tiered REMICs ............................................................   106
Title V ..................................................................    81
Title VIII ...............................................................    81
UCC ......................................................................    75
Underwriters .............................................................   115
U.S. Person ..............................................................    85
VA .......................................................................    17
VA Loans .................................................................    16
withholding agent ........................................................    93




                                      120

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