GS MORTGAGE SECURITIES CORP. Purchaser and SUNTRUST MORTGAGE, INC. Company
EXECUTION
GS
MORTGAGE SECURITIES CORP.
Purchaser
and
SUNTRUST
MORTGAGE, INC.
Company
September
1, 2007
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TABLE
OF CONTENTS
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ARTICLE
I
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DEFINITIONS
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Section
1.1.
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Definitions.
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1
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ARTICLE
II
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CONVEYANCE
OF MORTGAGE LOANS; POSSESSION OF MORTGAGE FILES; BOOKS AND RECORDS;
DELIVERY OF DOCUMENTS
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Section
2.1.
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Conveyance
of Mortgage Loans; Possession of Mortgage Files; Maintenance of Servicing
Files.
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13
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Section
2.2.
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Books
and Records; Transfers of Mortgage Loans.
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15
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Section
2.3.
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Delivery
of Documents.
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16
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Section
2.4.
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Mortgage
Schedule.
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18
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Section
2.5.
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Examination
of Mortgage Files.
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18
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Section
2.6.
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Representations,
Warranties and Agreements of the Company.
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18
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Section
2.7.
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Representation,
Warranties and Agreement of Purchaser.
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19
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Section
2.8.
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Closing.
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19
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Section
2.9.
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Closing
Documents.
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20
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ARTICLE
III
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REPRESENTATIONS
AND WARRANTIES REMEDIES AND BREACH
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Section
3.1.
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Company
Representations and Warranties.
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20
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Section
3.2.
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Representations
and Warranties Regarding Individual Mortgage Loans.
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23
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Section
3.3.
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Repurchase.
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34
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ARTICLE
IV
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ADMINISTRATION
AND SERVICING OF MORTGAGE LOANS
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Section
4.1.
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Company
to Act as Servicer.
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36
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Section
4.2.
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Liquidation
of Mortgage Loans.
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37
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Section
4.3.
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Collection
of Mortgage Loan Payments.
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38
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Section
4.4.
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Establishment
of and Deposits to Custodial Account.
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38
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Section
4.5.
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Permitted
Withdrawals From Custodial Account.
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40
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Section
4.6.
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Establishment
of and Deposits to Escrow Account.
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41
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Section
4.7.
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Permitted
Withdrawals From Escrow Account.
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42
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Section
4.8.
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Payment
of Taxes, Insurance and Other Charges.
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43
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Section
4.9.
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Protection
of Accounts.
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43
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Section
4.10.
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Maintenance
of Hazard Insurance.
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43
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Section
4.11.
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Maintenance
of Primary Mortgage Insurance Policy; Claims.
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45
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Section
4.12.
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Maintenance
of Mortgage Impairment Insurance.
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45
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Section
4.13.
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Maintenance
of Fidelity Bond and Errors and Omissions Insurance.
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46
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Section
4.14.
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Inspections.
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46
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Section
4.15.
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Restoration
of Mortgaged Property.
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47
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Section
4.16.
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Claims.
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47
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Section
4.17.
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Title,
Management and Disposition of REO Property.
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47
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Section
4.18.
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Real
Estate Owned Reports.
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49
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Section
4.19.
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Liquidation
Reports.
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49
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Section
4.20.
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Reports
and Returns to be Filed.
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49
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Section
4.21.
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Fair
Credit Reporting Act.
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49
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Section
4.22.
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Disaster
Recovery/Business Continuity Plan.
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49
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Section
4.23.
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MERS.
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49
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ARTICLE
V
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PAYMENTS
TO PURCHASER
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Section
5.1.
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Remittances.
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50
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Section
5.2.
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Statements
to Purchaser.
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50
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Section
5.3.
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Monthly
Advances by Company.
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51
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ARTICLE
VI
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GENERAL
SERVICING PROCEDURES
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Section
6.1.
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Transfers
of Mortgaged Property.
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51
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Section
6.2.
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Satisfaction
of Mortgages and Release of Mortgage Files.
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52
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Section
6.3.
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Servicing
Compensation.
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53
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Section
6.4.
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[Reserved]
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53
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Section
6.5.
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[Reserved]
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53
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Section
6.6.
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Right
to Examine Company Records.
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53
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Section
6.7.
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Compliance
with REMIC Provisions.
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53
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ARTICLE
VII
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COMPANY
TO COOPERATE
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Section
7.1.
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Provision
of Information.
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54
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Section
7.2.
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[Reserved]
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54
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Section
7.3.
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Cooperation
with Third-party Service Providers.
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54
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ARTICLE
VIII
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THE
COMPANY
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Section
8.1.
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Indemnification;
Third Party Claims.
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54
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Section
8.2.
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Merger
or Consolidation of the Company.
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55
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Section
8.3.
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Limitation
on Liability of Company and Others.
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55
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Section
8.4.
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Limitation
on Resignation and Assignment by Company.
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56
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-2-
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ARTICLE
IX
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SECURITIZATION
TRANSACTION
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Section
9.1.
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Removal
of Mortgage Loans from Inclusion Under this Agreement Upon the
Securitization Transaction.
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56
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ARTICLE
X
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DEFAULT
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Section
10.1.
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Events
of Default.
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58
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Section
10.2.
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Waiver
of Defaults.
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60
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ARTICLE
XI
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TERMINATION
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Section
11.1.
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Termination.
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60
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Section
11.2.
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Termination
Without Cause.
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60
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Section
11.3.
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Termination
With Cause.
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61
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Section
11.4.
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Servicing
of Distressed Mortgage Loans.
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61
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ARTICLE
XII
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MISCELLANEOUS
PROVISIONS
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Section
12.1.
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Successor
to Company.
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61
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Section
12.2.
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Amendment.
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63
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Section
12.3.
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Governing
Law.
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63
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Section
12.4.
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Duration
of Agreement.
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63
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Section
12.5.
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Notices.
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63
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Section
12.6.
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Severability
of Provisions.
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64
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Section
12.7.
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Relationship
of Parties.
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64
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Section
12.8.
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Execution;
Successors and Assigns.
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64
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Section
12.9.
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Recordation
of Assignments of Mortgage.
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64
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Section
12.10.
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Assignment
by Purchaser.
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64
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Section
12.11.
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Solicitation
of Mortgagor.
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65
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Section
12.12.
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Confidential
Information.
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65
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ARTICLE
XIII
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COMPLIANCE
WITH REGULATION AB
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Section
13.1.
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Intent
of the Parties; Reasonableness.
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66
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Section
13.2.
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Additional
Representations and Warranties of the Company.
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67
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Section
13.3.
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Information
to Be Provided by the Company.
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67
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Section
13.4.
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Servicer
Compliance Statement.
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72
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Section
13.5.
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Report
on Assessment of Compliance and Attestation.
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72
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Section
13.6.
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Use
of Subservicers and Subcontractors.
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73
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Section
13.7.
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Indemnification;
Remedies.
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74
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-3-
EXHIBITS
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Exhibit
A
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Mortgage
Loan Schedule
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Exhibit
B
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Contents
of Each Mortgage Loan File
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Exhibit
C
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[Reserved]
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Exhibit
D
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[Reserved]
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Exhibit
E
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Items
to Be Included in Monthly Remittance Advice
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Exhibit
F
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[Reserved]
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Exhibit
G
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Form
of Seller’s Officer’s Certificate
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Exhibit
H
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Form
of Annual Certification
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Exhibit
I
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Form
of Warranty ▇▇▇▇ of Sale
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Exhibit
J
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[Reserved]
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Exhibit
K
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Servicing
Criteria to be Addressed in Assessment of
Compliance
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-4-
This
is
the Sale and Servicing Agreement for various residential first mortgage loans,
dated and effective as of September 1, 2007, and is executed between GS Mortgage
Securities Corp., as purchaser (the “Purchaser”),
and
SunTrust Mortgage, Inc., as seller and servicer (the “Company”).
WITNESSETH
WHEREAS,
the Purchaser desires to purchase from the Company, certain adjustable rate
residential first-lien mortgage loans (each, a “Mortgage
Loan”)
on a
servicing retained basis as described herein; and
WHEREAS,
on the Closing Date, the Purchaser intends, for the purpose of entering into
the
securitization transaction, to convey the Mortgage Loans to the Trustee under
the Trust Agreement; and
NOW,
THEREFORE, in consideration of the mutual agreements hereinafter set forth,
and
for other good and valuable consideration, the receipt and adequacy of which
is
hereby acknowledged, the Purchaser and the Company agree as
follows:
ARTICLE
I
DEFINITIONS
Section
1.1. Definitions.Whenever
used herein, the following words and phrases, unless the content otherwise
requires, shall have the following meanings. Capitalized words and phrases
used
herein but not defined herein shall have the meanings set forth in the Trust
Agreement as in effect on the date of this Agreement:
Accepted
Servicing Practices:
With
respect to any Mortgage Loan, procedures (including collection procedures)
that
comply with applicable federal, state and local law and the ▇▇▇▇▇▇▇ Mac Single
Family Servicing Guide, and that the Company customarily employs and exercises
in servicing and administering mortgage loans for its own account and that
are
in accordance with accepted mortgage servicing practices of prudent mortgage
lending institutions which service mortgage loans of the same type as the
Mortgage Loans in the jurisdiction where the related Mortgaged Property is
located.
Agreement:
This
Sale and Servicing Agreement and all amendments hereof and supplements
hereto.
ALTA:
The
American Land Title Association or any successor thereto.
Annual
Certification:
The
certification delivered by the Company in a form substantially similar to
Exhibit H of this Agreement.
Appraised
Value:
With
respect to any Mortgage Loan, the lesser of (i) the value set forth on the
appraisal made in connection with the origination of the related Mortgage Loan
as the value of the related Mortgage Property, or (ii) the purchase price paid
for the Mortgage Property, provided, however, in the case of a refinanced
Mortgage Loan, such value shall be based solely on the appraisal made in
connection with the refinance of such Mortgage Loan.
Applicable
Law:
All
provisions of statutes, rules and regulations, interpretations and orders of
governmental bodies or regulatory agencies applicable to a Person, and all
orders and decrees of all courts and arbitrators in proceedings or actions
in
which the Person in question is a party.
ARM
Loan:
An
“adjustable rate” Mortgage
Loan, the Mortgage Interest Rate of which is subject to periodic adjustment
in
accordance with the terms of the Mortgage Note.
Assignment
of Mortgage or Assignment:
An
assignment of the Mortgage, notice of transfer or equivalent instrument in
recordable form, sufficient under the laws of the jurisdiction wherein the
related Mortgaged Property is located to reflect the sale of the Mortgage to
the
Purchaser or its designated assignee or, in the case of a MERS Mortgage Loan,
an
electronic transmission to MERS, identifying a transfer of ownership of the
related Mortgage to the Purchaser or its designee.
Business
Day:
Any day
other than (i) a Saturday or Sunday, or (ii) a day on which banking and savings
and loan institutions in the states where the parties are located are authorized
or obligated by law or executive order to be closed.
Certificates:
Any or
all of the Certificates issued pursuant to the Trust Agreement.
Closing
Date:
September 24, 2007.
Code:
The
Internal Revenue Code of 1986, as it may be amended from time to time or any
successor statute thereto, and applicable U.S. Department of the Treasury
regulations issued pursuant thereto.
Commission:
The
United States Securities and Exchange Commission.
Company:
SunTrust Mortgage, Inc., or its successor in interest or assigns, or any
successor to the Company under this Agreement appointed as herein
provided.
Company
Employees:
The
meaning assigned to such term in Section 4.13.
Company
Information:
As
defined in Subsection 13.7(a).
Condemnation
Proceeds:
All
awards or settlements in respect of a Mortgaged Property, whether permanent
or
temporary, partial or entire, by exercise of the power of eminent domain or
condemnation, to the extent not required to be released to a Mortgagor in
accordance with the terms of the related Mortgage Loan Documents.
Consumer
Information:
Information including, but not limited to, all personal information about the
Mortgagors that is supplied to the Company by or on behalf of the
Mortgagors.
-2-
Covered
Loan:
A
Mortgage Loan categorized as Covered pursuant to Appendix E of Standard &
Poor’s Glossary.
Custodial
Account:
The
separate account or accounts created and maintained pursuant to Section
4.4.
Custodial
Agreement:
The
custodial agreement dated as of September 1, 2007 among the Purchaser, the
Company and SunTrust Bank, as custodian, governing the retention of the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage and other
Mortgage Loan Documents.
Custodian:
The
custodian under the Custodial Agreement, or its successor in interest or
assigns, or any successor to the Custodian under such Custodial Agreement as
provided therein. The initial Custodian shall be SunTrust Bank.
Cut-off
Date:
September 1, 2007.
Depositor:
GS
Mortgage Securities Corp.
Determination
Date:
The day
preceding the Remittance Date, or if such day is not a Business Day, the
preceding Business Day.
Distressed
Mortgage Loan:
As of
any Determination Date, any Mortgage Loan that is delinquent in payment for
a
period of ninety (90) days or more, without giving effect to any grace period
permitted by the related Mortgage Loan, or for which the Company or Master
Servicer has accepted a deed in lieu of foreclosure.
Distribution
Date:
The
25th day of each month, or if such day is not a Business Day, the next Business
Day following such day. The initial Distribution Date shall be October 25,
2007.
Due
Date:
The
first day of the month on which the Monthly Payment is due on a Mortgage Loan,
exclusive of any days of grace.
Due
Period:
With
respect to each Remittance Date, the period commencing on the second day of
the
month preceding the month in which such Remittance Date occurs and ending on
(and including) the first day of the month in which such Remittance Date
occurs.
Errors
and Omissions Insurance Policy:
An
errors and omissions insurance policy to be maintained by the Company pursuant
to Section 4.13.
Escrow
Account:
The
separate account or accounts created and maintained pursuant to Section
4.6.
Escrow
Payments:
With
respect to any Mortgage Loan, the amounts constituting ground rents, taxes,
assessments, water rates, sewer rents, municipal charges, mortgage insurance
premiums, fire and hazard insurance premiums, condominium charges, and any
other
payments required to be escrowed by the Mortgagor with the mortgagee pursuant
to
the Mortgage or any other related document.
-3-
Event
of Default:
Any one
of the conditions or circumstances enumerated in Section 10.1.
Exchange
Act:
The
Securities Exchange Act of 1934, as amended.
FDIC:
The
Federal Deposit Insurance Corporation, and its successors.
Fidelity
Bond:
A
fidelity bond to be maintained by the Company pursuant to Section
4.12.
First
Remittance Date:
With
respect to the Closing Date, the Remittance Date occurring in the calendar
month
immediately following the month in which such Closing Date occurs.
FNMA:
Federal
National Mortgage Association, and its successors.
▇▇▇▇▇▇▇
Mac:
Federal
Home Loan Mortgage Company, and its successors.
Gross
Margin:
With
respect to each ARM Loan, the fixed percentage added to the Index on each Rate
Adjustment Date, as specified in each related Mortgage Note and listed in the
Mortgage Loan Schedule.
High
Cost Loan:
A
Mortgage Loan (a) covered by the Home Ownership and Equity Protection Act of
1994, (b) classified as a “high cost home,” “threshold,” “covered,” “high risk
home,” “predatory” or similar loan under any other applicable state, federal or
local law (or a similarly classified loan using different terminology under
a
law imposing heightened regulatory scrutiny or additional legal liability for
residential mortgage loans having high interest rates, points and/or fees)
or
(c) categorized as High Cost pursuant to Appendix E of Standard & Poor’s
Glossary. For avoidance of doubt, the parties agree that this definition shall
apply to any law regardless of whether such law is presently, or in the future
becomes, the subject of judicial review or litigation.
Home
Loan:
A
Mortgage Loan categorized as Home Loan pursuant to Appendix E of Standard &
Poor’s Glossary.
Index:
With
respect to each ARM Loan, on each Rate Adjustment Date, the applicable rate
index set forth on the Mortgage Loan Schedule.
Insurance
Proceeds:
Proceeds of any mortgage insurance, title policy, hazard policy or other
insurance policy covering a Mortgage Loan, if any, to the extent such proceeds
are not to be applied to the restoration of the related Mortgaged Property
or
released to the Mortgagor in accordance with the procedures that the Company
would follow in servicing mortgage loans held for its own account.
-4-
Lifetime
Rate Cap:
The
provision of each Mortgage Note related to an ARM Loan which provides for an
absolute maximum Mortgage Interest Rate thereunder. The Mortgage Interest Rate
during the terms of each ARM Loan shall not at any time exceed the Mortgage
Interest Rate at the time of origination of such ARM Loan by more than the
amount per annum set forth on the Mortgage Loan Schedule.
Liquidation
Proceeds:
Cash
(other than Insurance Proceeds or Condemnation Proceeds) received in connection
with the liquidation of a defaulted Mortgage Loan, whether through the sale
or
assignment of such Mortgage Loan, trustee’s sale, foreclosure sale, sale of REO
Property, or otherwise, or the sale of the related Mortgaged Property if the
Mortgaged Property is acquired in satisfaction of the Mortgage
Loan.
Loan-to-Value
Ratio:
With
respect to any Mortgage Loan, the ratio of the original loan amount of the
Mortgage Loan at its origination or refinancing, as applicable, to the Appraised
Value of the Mortgaged Property.
Manufactured
Home:
A
single family residential unit that is constructed in a factory in sections
in
accordance with the Federal Manufactured Home Construction and Safety Standards
adopted on July 15, 1976, by the Department of Housing and Urban Development
(“HUD
Code”),
as
amended in 2000, which preempts state and local building codes. Each unit is
identified by the presence of a HUD Plate/Compliance Certificate label. The
sections are then transported to the site and joined together and affixed to
a
pre-built permanent foundation (which satisfies the manufacturer’s requirements
and all state, county, and local building codes and regulations). The
manufactured home is built on a non-removable, permanent frame chassis that
supports the complete unit of walls, floors, and roof. The underneath part
of
the home may have running gear (wheels, axles, and brakes) that enable it to
be
transported to the permanent site. The wheels and hitch are removed prior to
anchoring the unit to the permanent foundation. The manufactured home must
be
classified as real estate and taxed accordingly. The permanent foundation may
be
on land owned by the mortgager or may be on leased land.
Master
Servicer:
▇▇▇▇▇
Fargo Bank, N.A., or any successor in interest, or if any successor master
servicer shall be appointed as provided in the Trust Agreement, then such
successor master servicer.
Maximum
Mortgage Interest Rate:
With
respect to each ARM Loan, the rate per annum set forth in the related Mortgage
Note as the maximum Mortgage Interest Rate thereunder. The Maximum Mortgage
Interest Rate as to each ARM Loan is set forth on the Mortgage Loan
Schedule.
MERS:
Mortgage Electronic Registration Systems, Inc., a Delaware corporation, or
any
successor in interest thereto.
MERS
Eligible Mortgage Loan:
Any
Mortgage Loan that under Applicable Law and investor requirements is recordable
in the name of MERS in the jurisdiction in which the related Mortgaged Property
is located.
-5-
MERS
Mortgage Loan:
Any
Mortgage Loan as to which the related Mortgage, or an Assignment, has been
recorded in the name of MERS, as agent for the holder from time to time of
the
Mortgage Note.
Minimum
Mortgage Interest Rate:
With
respect to each ARM Loan, the rate per annum set forth in the related Mortgage
Note as the minimum Mortgage Interest Rate thereunder. The Minimum Mortgage
Interest Rate as to each ARM Loan is set forth on the related Mortgage Loan
Schedule.
Monthly
Advance:
The
portion of each Monthly Payment that is delinquent with respect to each Mortgage
Loan at the close of business on the Determination Date required to be advanced
by the Company pursuant to Section 5.3 on the Business Day immediately preceding
the Remittance Date of the related month.
Monthly
Payment:
The
scheduled monthly payment of principal and interest on a Mortgage
Loan.
Monthly
Remittance Advice:
The
meaning assigned to such term in Section 5.2.
Mortgage:
The
mortgage, deed of trust or other instrument and riders thereto securing a
Mortgage Note, which creates a first lien on an unsubordinated estate in fee
simple in real property securing the Mortgage Note.
Mortgage
File:
The
items pertaining to a particular Mortgage Loan referred to in Exhibit B annexed
hereto, and any additional documents required to be added to the Mortgage File
pursuant to this Agreement.
Mortgage
Interest Rate:
The
annual rate of interest borne on a Mortgage Note in accordance with the
provisions of the Mortgage Note.
Mortgage
Loan:
An
individual Mortgage Loan which is the subject of this Agreement, each Mortgage
Loan originally sold and subject to this Agreement being identified on the
Mortgage Loan Schedule, which Mortgage Loan includes without limitation the
Mortgage File, the Monthly Payments, Principal Prepayments, Liquidation
Proceeds, Condemnation Proceeds, Insurance Proceeds, REO Disposition Proceeds
and all other rights, benefits, proceeds and obligations arising from or in
connection with such Mortgage Loan.
Mortgage
Loan Documents:
With
respect to a Mortgage Loan, the original related Mortgage Note with applicable
addenda and riders, the original related security instrument and the originals
of any required addenda and riders, the original related Assignment and any
original intervening related Assignments, the original related title insurance
policy, and the related appraisal report.
Mortgage
Loan Remittance Rate:
With
respect to each Mortgage Loan, the annual rate of interest remitted to the
Purchaser, which shall be equal to the Mortgage Interest Rate minus the
Servicing Fee Rate.
-6-
Mortgage
Loan Schedule:
The
schedule of Mortgage Loans, attached as Exhibit A, setting forth certain
information with respect to each Mortgage Loan, which shall include the
following information: (1) the Company’s Mortgage Loan number; (2) the address,
city, state and zip code of the Mortgaged Property; (3) a code indicating
whether the Mortgaged Property is a single family residence, two-family
residence, three-family residence, four family residence or planned unit
development; (4) the purpose of the Mortgage Loan; (5) the Mortgagor’s social
security number; (6) a code indicating the occupancy status of the Mortgaged
Property (i.e., owner-occupied, non-owner, second home); (7) a code indicating
whether the Mortgagor was self-employed at the time of origination; (8) the
Mortgage Interest Rate at origination; (9) the current Mortgage Interest Rate,
Lifetime Rate Cap, if applicable, and Periodic Rate Cap, if applicable; (10)
whether the Mortgage Loan has Monthly Payments that are interest only for a
period of time; (11) the Servicing Fee Rate; (12) the current Monthly Payment;
(13) the original term to maturity; (14) the remaining term to maturity; (15)
the actual principal balance of the Mortgage Loan as of the Cut-off Date; (16)
the principal balance of the Mortgage Loan at origination; (17) the principal
balance of the Mortgage Loan as of the Cut-off Date after deduction of payments
of principal due on or before the Cut-off Date whether or not collected; (18)
the LTV at origination or, if the Mortgage Loan was secured by a second lien,
the combined LTV at origination; (19) the due date of the Mortgage Loan; (20)
a
PMI Policy insurer name and code, percent and policy number (if applicable);
(21) the principal balance of that portion of the Mortgage Loan secured by
a
first lien and, if applicable, the principal balance of that portion of the
Mortgage Loan secured by a second lien; (22) the type of appraisal; (23) a
code
indicating whether the Mortgage Loan is a MERS Mortgage Loan; (24) a code
indicating whether the Mortgaged Property is secured by a second lien; (25)
a
code indicating whether the Mortgage Loan is secured by a leasehold interest
in
the related Mortgaged Property; (26) a code indicating whether the Mortgage
Loan
is subject to a prepay penalty; (27) documentation type (method of income
verification, asset verification and verification of employment); (28) a code
indicating whether the Mortgage Loan is a buydown loan; (29) first payment
date;
(30) FICO score; (31) payment history and (32) a code indicating if the Mortgage
Loan is a High Cost Loan or Home Loan as such terms are defined in the then
current Standard & Poor’s Glossary. With respect to any ARM Loan, in
addition to (1) through (31) above: (a) the Gross Margin; (b) the Periodic
Rate
Cap; (c) the Lifetime Rate Cap; (d) the first Interest Adjustment Date and
the
Interest Adjustment Date frequency; (e) the Maximum Mortgage Interest Rate;
(f)
the Minimum Mortgage Interest Rate; (g) the first Interest Adjustment Date
immediately following the Cut-off Date; and (h) the Index.
Mortgage
Note:
The
note or other evidence of the indebtedness of a Mortgagor secured by a Mortgage
and riders thereto.
Mortgaged
Property:
The
real property securing repayment of the debt evidenced by a Mortgage
Note.
Mortgagor:
The
obligor on a Mortgage Note.
Officer’s
Certificate:
A
certificate signed by the Chairman of the Board, the Vice Chairman of the Board,
the President, a Vice President, an Assistant Vice President, the Treasurer,
the
Secretary or one of the Assistant Treasurers or Assistant Secretaries of the
Company, and delivered to the Purchaser as required by this
Agreement.
-7-
Opinion
of Counsel:
A
written opinion of counsel, who may be an employee of the Company, reasonably
acceptable to the Purchaser.
Periodic
Rate Cap:
With
respect to each ARM Loan, the provision in each Mortgage Note that limits
permissible increases and decreases in the Mortgage Interest Rate on any Rate
Adjustment Date to not more than one percentage point with respect to each
ARM
Loan that is subject to semi-annual adjustment or two percentage points with
respect to each ARM Loan that is subject to annual adjustment.
Permitted
Investments:
Permitted Investments shall consist of the following:
(i) direct
obligations of, or obligations fully guaranteed as to principal and interest
by,
the United States or any agency or instrumentality thereof, provided such
obligations are backed by the full faith and credit of the United
States;
(ii) repurchase
obligations (the collateral for which is held by a third party, the Trustee
or
the Securities Administrator, or any of their respective affiliates) with
respect to any security described in clause (i) above, provided that the
long-term or short-term unsecured debt obligations of the party agreeing to
repurchase such obligations are at the time rated by each Rating Agency in
its
highest long-term unsecured debt rating categories;
(iii) certificates
of deposit, time deposits and bankers’ acceptances of any bank or trust company
(including the Trustee or the Securities Administrator or an affiliate of
either) incorporated under the laws of the United States or any state, provided
that the long-term unsecured debt obligations of such bank or trust company
at
the date of acquisition thereof have been rated by each Rating Agency in one
of
its two highest long-term unsecured debt rating categories;
(iv) commercial
paper (having original maturities of not more than 270 days) of any corporation
(including an affiliate of the Trustee or the Securities Administrator)
incorporated under the laws of the United States or any state thereof which
on
the date of acquisition has been rated by each Rating Agency in its highest
short-term unsecured debt rating available (i.e., “P-1” by ▇▇▇▇▇’▇ Investors
Service, Inc., “A-1+” by Standard & Poor’s Ratings Services and “F1+” by
Fitch, if rated by such rating agency);
(v) money
market funds administered by the Trustee or the Securities Administrator or
any
of their respective affiliates provided that such money market funds are rated
by each Rating Agency (i) in its highest short-term unsecured debt rating
category available (i.e., “P-1” by ▇▇▇▇▇’▇ Investors Service, Inc. “A-1+” by
Standard & Poor’s Ratings Services and “F-1+” by Fitch, Inc.) or
(ii) in one of its two highest long-term unsecured debt rating categories;
and
(vi) any
other
demand, money market or time deposit or obligation, or interest-bearing or
other
security or investment as would not affect the then current rating of the
Certificates by any Rating Agency (which shall include money market funds rated
in the highest long-term rating category with portfolios consisting solely
of
obligations in clauses (i) through (iv) above);
-8-
provided
that no
instrument described hereunder shall (a) evidence either the right to receive
only interest with respect to the obligations underlying such instrument, (b)
be
sold or disposed of before its maturity or (c) be any obligation of SunTrust
or
any of its Affiliates. Any Permitted Investment shall be relatively risk
free and no options or voting rights shall be exercised with respect to any
Permitted Investment. Any Permitted Investment shall be sold or disposed
of in accordance with Statement of Financial Accounting Standards No. 140,
paragraph 35c(6), in effect as of the Closing Date.
Person:
Any
individual, corporation, partnership, limited liability company, joint venture,
association, joint-stock company, trust, unincorporated organization, government
or any agency or political subdivision thereof.
Primary
Mortgage Insurance Policy:
Each
policy of primary mortgage insurance represented to be in effect pursuant to
Section 3.2(xxxii), or any replacement policy therefor obtained by the Servicer
pursuant to Section 4.8.
Prime
Rate:
The
prime rate announced to be in effect from time to time, as published as the
average rate in The Wall Street Journal.
Principal
Balance:
As to
each Mortgage Loan, (i) the actual outstanding principal balance of the Mortgage
Loan at the Cut-off Date after giving effect to payments of principal due on
or
before such date, whether or not received, minus (ii) all amounts attributable
to principal collected from or on behalf of the Mortgagor, including the
principal portion of Liquidation Proceeds, Condemnation Proceeds, and Insurance
Proceeds.
Principal
Prepayment:
Any
payment or other recovery of principal on a Mortgage Loan which is received
in
advance of its scheduled Due Date, including any prepayment penalty or premium
thereon and which is not accompanied by an amount of interest representing
scheduled interest due on any date or dates in any month or months subsequent
to
the month of prepayment.
Principal
Prepayment Period:
With
respect to each Remittance Date, the period commencing on the first day of
the
month preceding the month in which such Remittance Date occurs, and ending
on
the last day of such month.
Purchase
Price:
$735,958,880.20 (such amount has not been reduced by fees paid to ▇▇▇▇▇▇▇,
▇▇▇▇▇
& Co. or the Purchaser in respect of the offering of the Certificates, but
such amount has been reduced by the amount of funds paid by the Company for
the
Class 1A2, Class 2A3, Class 4A2, Class B1, Class B2, Class B3, Class B4, Class
B5 and Class B6 Certificates).
Purchaser:
GS
Mortgage Securities Corp., or its successor in interest or any successor to
the
Purchaser under this Agreement as herein provided.
Qualified
Correspondent:
Any
Person from which the Company purchased Mortgage Loans, provided that the
following conditions are satisfied: (i) such Mortgage Loans were originated
pursuant to an agreement between the Company and such Person that contemplated
that such Person would underwrite mortgage loans from time to time, for sale
to
the Company, in accordance with underwriting guidelines designated by the
Company (“Designated
Guidelines”)
or
guidelines that do not vary materially from such Designated Guidelines; (ii)
such Mortgage Loans were in fact underwritten as described in clause (i) above
and were acquired by the Company within 180 days after origination; (iii) either
(x) the Designated Guidelines were, at the time such Mortgage Loans were
originated, used by the Company in origination of mortgage loans of the same
type as the Mortgage Loans for the Company’s own account or (y) the Designated
Guidelines were, at the time such Mortgage Loans were underwritten, designated
by the Company on a consistent basis for use by lenders in originating mortgage
loans to be purchased by the Company; and (iv) the Company employed, at the
time
such Mortgage Loans were acquired by the Company, pre-purchase or post-purchase
quality assurance procedures (which may involve, among other things, review
of a
sample of mortgage loans purchased during a particular time period or through
particular channels) designed to ensure that Persons from which it purchased
mortgage loans properly applied the underwriting criteria designated by the
Company.
-9-
Qualification
Defect:
With
respect to a Mortgage Loan, (a) a defective document in the Mortgage File,
(b)
the absence of a document in the Mortgage File, or (c) the breach of any
representation, warranty or covenant with respect to the Mortgage Loan made
by
the Company, but, in each case, only if the affected Mortgage Loan would cease
to qualify as a “qualified
mortgage”
for
purposes of the REMIC Provisions.
Qualified
Depository:
A
federal or state chartered depository institution, the deposits in which are
insured by the FDIC to the applicable limits and the short-term unsecured debt
obligations of which (or, in the case of a depository institution that is a
subsidiary of a holding company, the short-term unsecured debt obligations
of
such holding company) are rated A-1 by Standard & Poor’s Ratings Group and
Prime-1 by ▇▇▇▇▇’▇ Investors Service, Inc. (or a comparable rating if another
rating agency is specified by the Purchaser by written notice to the Company)
at
the time any deposits are held on deposit therein; provided however, the Company
agrees that the holding company or other entity which maintains any accounts
subject to this definition, shall satisfy the rating requirements established
by
any Rating Agency which rates securities issued as part of the Securitization
Transaction. In the event the institution is no longer acceptable to the Rating
Agencies, the funds shall be transferred to a Qualified Depository within 30
days.
Qualified
Insurer:
A
mortgage guaranty insurance company duly authorized and licensed where required
by law to transact mortgage guaranty insurance business and approved as an
insurer by FNMA.
Rate
Adjustment Date:
With
respect to each ARM Loan, the date on which the Mortgage Interest Rate
adjusts.
Rating
Agency:
▇▇▇▇▇’▇
Investors Service, Inc., Standard & Poor’s Ratings Group, division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Fitch, Inc (doing business as “Fitch
Ratings”),
or
any other nationally recognized statistical credit rating agency rating any
security issued in connection with the Securitization Transaction.
-10-
Regulation
AB:
Subpart
229.1100 - Asset Backed Securities (Regulation AB), 17 C.F.R.
§§229.1100-229.1123, as such may be amended from time to time, and subject to
such clarification and interpretation as have been provided by the Commission
in
the adopting release (Asset-Backed Securities, Securities Act Release No.
33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff of the
Commission, or as may be provided by the Commission or its staff from time
to
time.
REMIC:
A
“real
estate mortgage investment conduit”
within
the meaning of Section 860D of the Code.
REMIC
Provisions:
Provisions of the federal income tax law relating to a REMIC, which appear
at
Section 860A through 860G of Subchapter M of Chapter 1, Subtitle A of the Code,
and related provisions, and regulations, rulings or pronouncements promulgated
thereunder, as the foregoing may be in effect from time to time.
Remittance
Advice Date:
The
10th Business Day of each month or, if such 10th day is not a Business Day,
the
first Business Day immediately succeeding such date.
Remittance
Date:
The
22nd day (or if such 22nd is not a Business Day, the first Business Day
immediately preceding such date) of any month, beginning with the First
Remittance Date.
REO
Disposition:
The
final sale by the Company of any REO Property.
REO
Disposition Proceeds:
All
amounts received with respect to an REO Disposition pursuant to Section
4.16.
REO
Property:
A
Mortgaged Property acquired by the Company on behalf of the Purchaser through
foreclosure or by deed in lieu of foreclosure, as described in Section
4.16.
Repurchase
Price:
Unless
agreed otherwise by the Purchaser and the Company, a price equal to (i) the
Scheduled Principal Balance of the Mortgage Loan plus (ii) interest on such
Scheduled Principal Balance at the Mortgage Loan Remittance Rate from the date
on which interest has last been paid and distributed to the Purchaser to the
last day of the month of repurchase, less amounts received or advanced in
respect of such repurchased Mortgage Loan which are being held in the Custodial
Account for distribution in the month of repurchase, to the extent such amounts
are actually paid to the Purchaser upon the repurchase of the related Mortgage
Loan plus (iii) any costs and damages incurred by the Trust in the
Securitization Transaction in connection with any violation by the applicable
Mortgage Loan of any predatory or abusive lending law.
Scheduled
Principal Balance:
As to
each Mortgage Loan, (i) the principal balance of the Mortgage Loan at the
Cut-off Date after giving effect to payments of principal due on or before
such
date, whether or not received, minus (ii) all amounts previously collected
by
the Company as servicer hereunder or advanced and distributed to the Purchaser
with respect to the related Mortgage Loan representing payments or recoveries
of
principal or advances made in lieu thereof.
-11-
Securities
Act:
The
Securities Act of 1933, as amended.
Securities
Administrator:
▇▇▇▇▇
Fargo Bank, N.A., and its successors and assigns.
Securitization
Transaction:
The
transaction related to the issuance of Mortgage Pass-Through Certificates,
Series 2007-4 by STARM Mortgage Loan Trust 2007-4, closing on the Closing
Date.
Seller:
SunTrust Mortgage, Inc., and its successors and assigns.
Servicer:
SunTrust Mortgage, Inc.,
and its
successors and assigns.
Servicing
Advances:
All
customary, reasonable and necessary “out
of
pocket”
costs
and expenses other than Monthly Advances (including reasonable attorney’s fees
and disbursements) incurred in the performance by the Company of its servicing
obligations, including, but not limited to, the cost of (a) the preservation,
restoration and protection of the Mortgaged Property, (b) any enforcement or
judicial proceedings, including foreclosures, (c) the management and liquidation
of any REO Property and (d) compliance with the obligations under Section
4.8.
Servicing
Criteria:
The
“servicing criteria” set forth in Item 1122(d) of Regulation AB, as such may be
amended from time to time.
Servicing
Fee:
With
respect to each Mortgage Loan, the amount of the per annum fee the Purchaser
shall pay to the Company, which shall, for a period of one full month, be equal
to one-twelfth of the product of (a) the Servicing Fee Rate and (b) the
Scheduled Principal Balance of such Mortgage Loan. Such fee shall be payable
monthly, computed on the basis of the same principal amount and same period
for
which any related interest payment on a Mortgage Loan is computed. The
obligation of the Purchaser to pay the Servicing Fee is limited to, and the
Servicing Fee is payable solely from, the interest portion (including recoveries
with respect to interest from Liquidation Proceeds, to the extent permitted
by
Section 4.5) of such Monthly Payment collected by the Company, or as otherwise
provided under Section 4.5.
Servicing
Fee Rate:
0.250%.
Servicing
File:
With
respect to each Mortgage Loan, the file retained by the Company consisting
of
originals of all documents in the Mortgage File which are not delivered to
the
Custodian and copies of the Mortgage Loan Documents listed in the Custodial
Agreement the originals of which are delivered to the Custodian pursuant to
Section 2.3.
Servicing
Officer:
Any
officer of the Company involved in or responsible for the administration and
servicing of the Mortgage Loans whose name appears on a list of servicing
officers furnished by the Company to the Purchaser upon request, as such list
may from time to time be amended.
Special
Servicer:
The
person designated by the Company (with the prior consent of the Trustee and
the
Master Servicer) to assume the servicing of Distressed Mortgage Loans pursuant
to Section 11.4 hereof.
-12-
Sponsor:
SunTrust Mortgage, Inc.
Standard
& Poor’s:
Standard & Poor’s Rating Services, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies
Inc., and its successors in interest.
Standard
& Poor’s Glossary:
The
Standard & Poor’s LEVELS® Glossary, as may be in effect from time to
time.
Static
Pool Information:
Static
pool information as described in Item 1105(a)(1)-(3) and 1105(c) of Regulation
AB.
Subcontractor:
Any
vendor, subcontractor or other Person that is not responsible for the overall
servicing (as “servicing” is commonly understood by participants in the
mortgage-backed securities market) of Mortgage Loans but performs one or more
discrete functions identified in Item 1122(d) of Regulation AB with respect
to
Mortgage Loans under the direction or authority of the Company or a
Subservicer.
Subservicer:
Any
Person that services Mortgage Loans on behalf of the Company or any Subservicer
and is responsible for the performance (whether directly or through Subservicers
or Subcontractors) of a substantial portion of the material servicing functions
identified in Item 1122(d) of Regulation AB that are required to be performed
by
the Company under this Agreement.
Terminating
Purchase:
The
purchase of all Mortgage Loans and each REO Property owned by the Trust pursuant
to Section 10.02 of the Trust Agreement.
Third-Party
Originator:
Each
Person, other than a Qualified Correspondent, that originated Mortgage Loans
acquired by the Company.
Trust:
STARM
Mortgage Loan Trust 2007-4.
Trust
Agreement:
The
Trust Agreement dated as of September 1, 2007, among the Trustee, the Master
Servicer and the Depositor.
Trustee:
Deutsche
Bank National Trust Company or any successor in interest, or if any successor
trustee or co-trustee shall be appointed as provided in the Trust Agreement,
then such successor trustee or such co-trustee, as the case may be.
Warranty
▇▇▇▇ of Sale:
A
warranty ▇▇▇▇ of sale with respect to the Mortgage Loans purchased on the
Closing Date in the form annexed hereto as Exhibit I.
ARTICLE
II
CONVEYANCE
OF MORTGAGE LOANS; POSSESSION OF MORTGAGE FILES; BOOKS AND RECORDS; DELIVERY
OF
DOCUMENTS
Section
2.1. Conveyance
of Mortgage Loans; Possession of Mortgage Files; Maintenance of Servicing
Files.The
Company agrees to sell and Purchaser agrees to purchase, those certain Mortgage
Loans identified in the Mortgage Loan Schedule, at the price and on the terms
set forth herein. The Purchaser, on the Closing Date, shall be obligated
to
purchase such Mortgage Loans set forth in the Mortgage Loan Schedule, subject
to
the terms and conditions of this Agreement.
-13-
The
closing shall, at Purchaser’s option be either: by telephone, confirmed by
letter or wire as the parties shall agree; or conducted in person at such
place
as the parties shall agree. On the Closing Date and subject to the terms
and
conditions of this Agreement, the Company will sell, transfer, assign, set
over
and convey to the Purchaser, without recourse except as set forth in this
Agreement, and the Purchaser will purchase, all of the right, title and interest
of the Company in and to the Mortgage Loans being conveyed by it hereunder,
as
identified on the Mortgage Loan Schedule.
On
the
Closing Date and in accordance with the terms herein, the Purchaser will
pay to
the Company, by wire transfer of immediately available funds, (i) the Purchase
Price, which amount includes accrued interest, and (ii) 100% beneficial interest
in each of the Trust’s Mortgage Pass-Through Certificates, Series 2007-4, Class
1A2, Class 2A3, Class 4A2, Class B1, Class B2 and Class B3 Certificates (the
“Retained Certificates”), which Retained Certificates will initially be
registered in the name of SunTrust Mortgage, Inc., or its designee, according
to
the instructions to be provided by the Company. The Company, simultaneously
with
the payment of the Purchase Price, shall execute and deliver to the Purchaser
a
Warranty ▇▇▇▇ of Sale with respect to the Mortgage Loans in the form annexed
hereto as Exhibit I.
The
principal balance of each Mortgage Loan as of the Cut-off Date shall be
determined after application of payments of principal due on or before the
Cut-off Date whether or not collected. Therefore, payments of scheduled
principal and interest prepaid for a Due Date beyond the Cut-off Date shall
not
be applied to the principal balance as of the Cut-off Date. Such prepaid
amounts
(minus interest at the Servicing Fee Rate) shall be the property of the
Purchaser. The Company shall deposit any such prepaid amounts into the Custodial
Account, which account is established for the benefit of the Purchaser for
subsequent remittance by the Company to the Purchaser, and shall remit such
amounts as provided in Section 5.1.
Pursuant
to Section 2.3, the Company shall deliver the Mortgage Loan Documents to
the
Custodian. The contents of each Mortgage File not delivered to the Custodian
are
and shall be held in trust by the Company for the benefit of the Purchaser
as
the owner thereof. The Company shall maintain a Servicing File consisting
of a
copy of the contents of each Mortgage File and the originals of the documents
in
each Mortgage File not delivered to the Custodian. The possession of each
Servicing File by the Company is at the will of the Purchaser for the sole
purpose of servicing the related Mortgage Loan, and such retention and
possession by the Company is in a custodial capacity only. Upon the sale
of the
Mortgage Loans the ownership of each Mortgage Note, the related Mortgage
and the
related Mortgage File and Servicing File shall vest immediately in the
Purchaser, and the ownership of all records and documents with respect to
the
related Mortgage Loan prepared by or which come into the possession of the
Company shall vest immediately in the Purchaser and shall be retained and
maintained by the Company, in trust, at the will of the Purchaser and only
in
such custodial capacity. The Company shall release its custody of the contents
of any Servicing File only in accordance with written instructions from the
Purchaser, unless such release is required as incidental to the Company’s
servicing of the Mortgage Loans or is in connection with a repurchase of
any
Mortgage Loan pursuant to Sections 2.3, 3.3 or 6.2.
-14-
In
addition, in connection with the assignment of any MERS Mortgage Loan, the
Company agrees that it will cause, at its own expense, the MERS® System to
indicate that such Mortgage Loans have been assigned by the Company to the
Purchaser in accordance with this Agreement by including (or deleting, in
the
case of Mortgage Loans which are repurchased in accordance with this Agreement)
in such computer files the information required by the MERS® System to identify
the Purchaser of such Mortgage Loans. Prior to the assignment of any MERS
Mortgage Loan, the Purchaser will provide the Company with the Purchaser’s MERS
registration number. The Company further agrees that it will not alter the
information referenced in this paragraph with respect to any Mortgage Loan
during the term of this Agreement unless and until such Mortgage Loan is
repurchased in accordance with the terms of this Agreement.
Section
2.2. Books
and Records; Transfers of Mortgage Loans.
From
and
after the sale of the Mortgage Loans to the Purchaser all rights arising
out of
the Mortgage Loans including but not limited to all funds received on or
in
connection with the Mortgage Loans, shall be received and held by the Company
in
trust for the benefit of the Purchaser as owner of the Mortgage Loans, and
the
Company shall retain record title to the related Mortgages for the sole purpose
of facilitating the servicing and the supervision of the servicing of the
Mortgage Loans.
The
sale
of each Mortgage Loan shall be reflected on the Company’s balance sheet and
other financial statements as a sale of assets by the Company. The Company
shall
be responsible for maintaining, and shall maintain, a complete set of books
and
records for each Mortgage Loan which shall be marked clearly to reflect the
ownership of each Mortgage Loan by the Purchaser. In particular, the Company
shall maintain in its possession, available for inspection by the Purchaser,
or
its designee, and shall deliver to the Purchaser upon demand, evidence of
compliance with all federal, state and local laws, rules and regulations,
and
requirements of FNMA or ▇▇▇▇▇▇▇ Mac, including but not limited to documentation
as to the method used in determining the applicability of the provisions
of the
Flood Disaster Protection Act of 1973, as amended, to the Mortgaged Property,
documentation evidencing insurance coverage and eligibility of any condominium
project for approval by FNMA or ▇▇▇▇▇▇▇ Mac, and periodic inspection reports
as
required by Section 4.13. To the extent that original documents are not required
for purposes of realization of Liquidation Proceeds or Insurance Proceeds,
documents maintained by the Company may be in the form of microfilm or
microfiche or such other reliable means of recreating original documents,
including but not limited to, optical imagery techniques so long as the Company
complies with the requirements of the FNMA or ▇▇▇▇▇▇▇ Mac Selling and Servicing
Guide, as amended from time to time.
The
Company shall maintain with respect to each Mortgage Loan and shall make
available for inspection by any Purchaser or its designee the related Servicing
File during the time the Purchaser retains ownership of a Mortgage Loan and
thereafter in accordance with Applicable Law.
The
Company shall keep at its servicing office books and records in which, subject
to such reasonable regulations as it may prescribe, the Company shall note
transfers of Mortgage Loans. No transfer of a Mortgage Loan may be made unless
such transfer is in compliance with the terms hereof. For the purposes of
this
Agreement, the Company shall be under no obligation to deal with any person
with
respect to this Agreement or the Mortgage Loans unless the books and records
show such person as the owner of the Mortgage Loan. The Purchaser intends
to
sell and transfer the Mortgage Loans to the Trustee, on behalf of the Trust,
on
the Closing Date. The Company shall ▇▇▇▇ its books and records to reflect
the
ownership of the Mortgage Loans of such assignee, and shall release the previous
Purchaser from its obligations hereunder with respect to the Mortgage Loans
sold
or transferred.
-15-
Section
2.3. Delivery
of Documents.
Pursuant
to the Custodial Agreement delivered to the Purchaser on or before the Closing
Date, the Company shall deliver and release to the Custodian those Mortgage
Loan
Documents as required by the Custodial Agreement and by this Agreement with
respect to each Mortgage Loan being transferred to the Purchaser on such
Closing
Date.
The
Custodian shall certify its receipt of all such Mortgage Loan Documents required
to be delivered pursuant to the Custodial Agreement. The Company will be
responsible for the Custodian’s fees and expenses with respect to the delivery
and certification of those Mortgage Loan Documents required to be delivered
pursuant to the Custodial Agreement. The Company will be responsible for
the
fees and expenses related to the recording of the initial Assignments of
Mortgage (including any fees and expenses related to any preparation and
recording of any intervening or prior assignments of the Mortgage Loans to
the
Company or to any prior owners of or mortgagees with respect to the Mortgage
Loans). The Purchaser will be responsible for the Custodian’s fees and expenses
with respect to the initial inventory and maintenance of the Mortgage Loans
on
or after the Closing Date, including the costs associated with clearing
exceptions.
Within
90
days after the Closing Date, the Company shall deliver to the Custodian each
of
the documents described in Exhibit B not delivered pursuant to the Agreement
with respect to the related Mortgage Loans.
The
Company shall forward to the Custodian original documents evidencing an
assumption, modification, consolidation or extension of any Mortgage Loan
entered into in accordance with Section 4.1 or 6.1 within one week of their
execution, provided, however, that the Company shall provide the Custodian
with
a certified true copy of any such document submitted for recordation within
ten
(10) days of its execution, and shall provide the original of any document
submitted for recordation or a copy of such document certified by the
appropriate public recording office to be a true and complete copy of the
original within 60 days of its submission for recordation.
In
the
event the public recording office is delayed in returning any original document,
the Company shall deliver to the Custodian within 180 days of its submission
for
recordation, a copy of such document and an Officer’s Certificate, which shall
(i) identify the recorded document; (ii) state that the recorded document
has
not been delivered to the Custodian due solely to a delay by the public
recording office, (iii) state the amount of time generally required by the
applicable recording office to record and return a document submitted for
recordation, and (iv) specify the date the applicable recorded document will
be
delivered to the Custodian. The Company will be required to deliver the document
to the Custodian by the date specified in (iv) above. An extension of the
date
specified in (iv) above may be requested from the Purchaser, which consent
shall
not be unreasonably withheld.
-16-
Notwithstanding
the foregoing, if the originals or certified copies required in this Section
2.3
are not delivered as required within 90 days following the Closing Date or
as
otherwise extended as set forth above, the related Mortgage Loan shall, upon
request of the Purchaser, be repurchased by the Company in accordance with
Section 3.3 hereof; provided, however, that the foregoing repurchase obligation
shall not apply in the event the Company cannot deliver such items due to
a
delay caused by the recording office in the applicable jurisdiction; provided
that the Company shall deliver instead a recording receipt of such recording
office or, if such recording receipt is not available, an Officer’s Certificate
from the Company confirming that such documents have been accepted for
recording. Any such document shall be delivered to the Purchaser or its designee
promptly upon receipt thereof from the related recording office.
If,
subsequent to the Closing Date, the Company, the Purchaser or the Custodian
finds any document or documents constituting a part of a Mortgage File
pertaining to a Mortgage Loan to be defective (or missing) in any material
respect, and such defect or missing document materially and adversely affects
the value of the related Mortgage Loan or the interests of the Purchaser
therein, the party discovering such defect shall promptly so notify the Company.
The Company shall have a period of 90 days after receipt of such written
notice
within which to correct or cure any such defect. The Company hereby covenants
and agrees that, if any material defect cannot be corrected or cured, the
Company will, upon the expiration of the applicable cure period described
above,
repurchase the related Mortgage Loan in the manner set forth in Section 3.3;
provided, however, that with respect to any Mortgage Loan, if such defect
constitutes a Qualification Defect, any such repurchase must take place within
75 days of the date such defect is discovered.
Notwithstanding
the foregoing, with respect to a Mortgage Loan, if, at the end of such 90-day
period, the Company delivers an Officer’s Certificate to the Purchaser
certifying that the Company is using good faith efforts to correct or cure
such
defect and identifying progress made, then the Purchaser shall grant the
Company
an extension to correct or cure such defect. The extension shall not extend
beyond (1) the date that is 75 days after the date the defect is discovered,
or,
(2) if the defect is not a Qualification Defect (as evidenced by an Opinion
of
Counsel), the date that is 30 days beyond the original 90-day cure period.
If
the defect is not a Qualification Defect, additional 30-day extensions may
be
obtained pursuant to the same procedure, as long as the Company demonstrates
continued progress toward a correction or cure; provided that no extension
shall
be granted beyond 180 days from the date on which the Company received the
original notice of the defect.
Notwithstanding
the foregoing, with respect to a Mortgage Loan, the failure of the Purchaser
to
notify the Company of any defective or missing document in a Mortgage File
within such 90-day period, or the failure of the Purchaser to require the
Company to cure or repurchase the related Mortgage Loan upon expiration of
such
90-day period, shall not constitute a waiver of its rights hereunder, including
the rights with respect to a Mortgage Loan, to require the Company to repurchase
the affected Mortgage Loan and the right to indemnification pursuant to Section
3.3 hereof.
-17-
Section
2.4. Mortgage
Schedule. The
Company shall provide the Purchaser with certain information constituting
a
listing of the Mortgage Loans to be purchased under this Agreement (the
“Mortgage
Loan Schedule”)
on the
Closing Date substantially in the form attached hereto as Exhibit A. The
Mortgage Loan Schedule shall conform to the definition of “Mortgage
Loan Schedule”
hereunder.
Section
2.5. Examination
of Mortgage Files. Prior
to the Closing Date, the Company shall (a) deliver to the Purchaser in escrow,
for examination, the Mortgage File for each Mortgage Loan to be transferred
on
the Closing Date, including a copy of the Assignment of Mortgage, pertaining
to
each Mortgage Loan, or (b) make the Mortgage Files available to the Purchaser
for examination at the Company’s offices or such other location as shall
otherwise be agreed upon by the Purchaser and the Company. Such examination
may
be made by the Purchaser, or by any prospective purchaser of the Mortgage
Loans
from the Purchaser, at any time before or after the Closing Date upon prior
reasonable notice to the Company. The fact that the Purchaser or any prospective
purchaser of the Mortgage Loans has conducted or has failed to conduct any
partial or complete examination of the Mortgage Files shall not affect the
Purchaser’s (or any of its successor’s) rights to demand repurchase,
substitution or other relief as provided under this Agreement.
Section
2.6. Representations,
Warranties and Agreements of the Company. The
Company agrees and acknowledges that it shall, as a condition to the
consummation of the transactions contemplated hereby, make the representations
and warranties specified in Sections 3.1 and 3.2 as of the Closing Date for
the
related Mortgage Loans. The Company, without conceding that the Mortgage
Loans
are securities, hereby makes the following additional representations,
warranties and agreements which shall be deemed to have been made as of the
Closing Date for the related Mortgage Loans:
(i) neither
the Company nor anyone acting on its behalf has offered, transferred, pledged,
sold or otherwise disposed of any Mortgage Loans, any interest in any Mortgage
Loans or any other similar security to, or solicited any offer to buy or
accept
a transfer, pledge or other disposition of any Mortgage Loans, any interest
in
any Mortgage Loans or any other similar security from, or otherwise approached
or negotiated with respect to any Mortgage Loans, any interest in any Mortgage
Loans or any other similar security with, any person in any manner, or made
any
general solicitation by means of general advertising or in any other manner,
or
taken any other action which would constitute a distribution of the Mortgage
Loans under the Securities Act or which would render the disposition of any
Mortgage Loans a violation of Section 5 of the Securities Act or require
registration pursuant thereto, nor will it act, nor has it authorized or
will it
authorize any person to act, in such manner with respect to the Mortgage
Loans;
and
(ii) the
Company has not dealt with any broker or agent or anyone else who might be
entitled to a fee or commission in connection with this transaction other
than
the Purchaser.
-18-
Section
2.7. Representation,
Warranties and Agreement of Purchaser. The
Purchaser, without conceding that the Mortgage Loans are securities, hereby
makes the following representations, warranties and agreements, which shall
have
been deemed to have been made as of the Closing Date for the related Mortgage
Loans:
(i) the
Purchaser understands that the Mortgage Loans have not been registered under
the
Securities Act or the securities laws of any state;
(ii) the
Purchaser is acquiring the Mortgage Loans for its own account only and not
for
any other person;
(iii) the
Purchaser considers itself a substantial, sophisticated institutional investor
having such knowledge and experience in financial and business matters that
it
is capable of evaluating the merits and risks of investment in the Mortgage
Loans;
(iv) the
Purchaser handles all Company information in compliance with the requirements
of
The ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act (15 U.S.C. Sections 6801 to 6805), and the
regulations promulgated thereunder, including the Interagency Guidelines
Establishing Standards for Safeguarding Customer Information (collectively,
the
“Privacy
Laws”),
and
to the extent that regulations promulgated under, or amendments to the Privacy
Laws, or any other relevant law or regulations require additional or modified
security, privacy or confidentiality agreements between financial institutions
and third party vendors, the Purchaser agrees that it will execute such
additional or modified agreements as required by the Company; and
(v) the
Purchaser agrees to negotiate in good faith, when so requested by the Company,
terms pursuant to which it will assist the Company in the preparation of
updated
disclosure related to a future offering document for this Securitization
Transaction, as necessary.
Section
2.8. Closing. The
closing for the purchase and sale of the Mortgage Loans shall take place
on the
Closing Date. At the Purchaser’s option, the closing shall be either: by
telephone, confirmed by letter or wire as the parties shall agree; or conducted
in person, at such place as the parties shall agree.
The
closing shall be subject to each of the following conditions:
(i) all
of
the representations and warranties of the Company under this Agreement shall
be
true and correct as of the Closing Date and no event shall have occurred
which,
with notice or the passage of time, would constitute a default under this
Agreement;
(ii) the
Purchaser shall have received, or the Purchaser’s attorneys shall have received
in escrow, all Closing Documents for the Mortgage Loans as specified in Section
2.9 of this Agreement, in such forms as are agreed upon and acceptable to
the
Purchaser, duly executed by all signatories other than the Purchaser as required
pursuant to the respective terms thereof;
-19-
(iii) the
Company shall have delivered and released to the Custodian all documents
required pursuant to this Agreement and the Custodial Agreement,
and
(iv) all
other
terms and conditions of this Agreement shall have been complied
with.
Subject
to the foregoing conditions, the Purchaser shall pay to the Company on the
Closing Date the Purchase Price for the Mortgage Loans by wire transfer of
immediately available funds to the account designated by the
Company.
Section
2.9. Closing
Documents. With
respect to the Mortgage Loans, the Closing Documents shall consist of fully
executed originals of the following documents:
(i) this
Agreement, in two counterparts;
(ii) the
Custodial Agreement, dated as of the Cut-off Date;
(iii) the
Mortgage Loan Schedule, one copy to be attached to each counterpart of this
Agreement, and to each counterpart of the Custodial Agreement, as the Mortgage
Loan Schedule thereto;
(iv) a
Receipt
and Certification, as required under the Custodial Agreement;
(v) an
officer’s certificate of the Company substantially in the form of Exhibit G
attached hereto;
(vi) an
Opinion of Counsel of the Company; and
(vii) a
Warranty ▇▇▇▇ of Sale, in the form of Exhibit I hereto.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES REMEDIES AND BREACH
Section
3.1. Company
Representations and Warranties. The
Company hereby represents and warrants to the Purchaser and its successors
and
assigns that, as of the Closing Date:
(a) Due
Organization and Authority.
The
Company is a corporation duly organized, validly existing and in good standing
under the laws of the Commonwealth of Virginia and is duly authorized and
licensed to originate mortgage loans (including without limitation the Mortgage
Loans) and to carry on its business as now being conducted as an operating
subsidiary of a Georgia banking corporation. The Company has the full corporate
power, authority and legal right to hold, transfer and convey the Mortgage
Loans
and to execute and deliver this Agreement and to perform its obligations
hereunder and is licensed, qualified and in good standing in each state where
a
Mortgaged Property is located if the laws of such state require licensing
or
qualification in order to conduct business of the type conducted by the Company,
and in any event, the Company is in compliance with the laws of any such
state
to the extent necessary to ensure the enforceability of the related Mortgage
Loan and the servicing of such Mortgage Loan in accordance with the terms
of
this Agreement; the Company has the full corporate power and authority to
execute and deliver this Agreement and to perform in accordance herewith;
the
execution, delivery and performance of this Agreement (including without
limitation all instruments of transfer to be delivered pursuant to this
Agreement) by the Company and the consummation of the transactions contemplated
hereby have been duly and validly authorized; this Agreement and all agreements
contemplated hereby have been duly executed and delivered and constitute
the
valid, legal, binding and enforceable obligations of the Company, regardless
of
whether such enforcement is sought in a proceeding in equity or at law; and
all
requisite corporate action has been taken by the Company to make this Agreement
and all agreements contemplated hereby valid and binding upon the Company
in
accordance with their terms;
-20-
(b) Ordinary
Course of Business.
The
consummation of the transactions contemplated by this Agreement are in the
ordinary course of business of the Company, which is in the business of selling
and servicing loans, and the transfer, assignment and conveyance of the Mortgage
Notes and the Mortgages by the Company pursuant to this Agreement are not
subject to the bulk transfer or any similar statutory provisions in effect
in
any applicable jurisdiction;
(c) No
Conflicts.
Neither
the execution and delivery of this Agreement, the acquisition of the Mortgage
Loans by the Company, the sale of the Mortgage Loans to the Purchaser or
the
transactions contemplated hereby, nor the fulfillment of or compliance with
the
terms and conditions of this Agreement will conflict with or result in a
breach
of any of the terms, articles of incorporation or by-laws or any legal
restriction or any agreement or instrument to which the Company is now a
party
or by which it is bound, or constitute a default or result in the violation
of
any law, rule, regulation, order, judgment or decree to which the Company
or its
property is subject, or impair the ability of the Purchaser to realize on
the
Mortgage Loans, or impair the value of the Mortgage Loans;
(d) Ability
to Service.
The
Company is an approved seller/servicer of residential mortgage loans for
FNMA
and ▇▇▇▇▇▇▇ Mac, with the facilities, procedures, and experienced personnel
necessary for the sound servicing of mortgage loans of the same type as the
Mortgage Loans. The Company is in good standing to sell mortgage loans to
and
service mortgage loans for FNMA and ▇▇▇▇▇▇▇ Mac, and no event has occurred,
including but not limited to a change in insurance coverage, which would
make
the Company unable to comply with FNMA or ▇▇▇▇▇▇▇ Mac eligibility requirements
or which would require notification to FNMA or ▇▇▇▇▇▇▇ Mac;
(e) Reasonable
Servicing Fee.
The
Company acknowledges and agrees that the Servicing Fee represents reasonable
compensation for performing such services and that the entire Servicing Fee
shall be treated by the Company, for accounting and tax purposes, as
compensation for the servicing and administration of the Mortgage Loans pursuant
to this Agreement;
-21-
(f) Ability
to Perform.
The
Company does not believe, nor does it have any reason or cause to believe,
that
it cannot perform each and every covenant contained in this Agreement. The
Company is solvent and the sale of the Mortgage Loans will not cause the
Company
to become insolvent. The sale of the Mortgage Loans is not undertaken to
hinder,
delay or defraud any of the Company’s creditors;
(g) No
Litigation Pending.
There
is
no action, suit, proceeding or investigation pending or threatened against
the
Company which, either in any one instance or in the aggregate, may result
in any
material adverse change in the business, operations, financial condition,
properties or assets of the Company, or in any material impairment of the
right
or ability of the Company to carry on its business substantially as now
conducted, or lead to any material liability on the part of the Company,
or
which would draw into question the validity of this Agreement or the Mortgage
Loans or of any action taken or to be contemplated herein, or which would
be
likely to impair materially the ability of the Company to perform under the
terms of this Agreement. There is no action, suit, proceeding or investigation
pending against the Company with respect to the Mortgage Loans relating to
fraud, origination, predatory lending, servicing or closing
practices;
(h) No
Consent Required.
No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by the Company
of
or compliance by the Company with this Agreement or the sale of the Mortgage
Loans as evidenced by the consummation of the transactions contemplated by
this
Agreement, or if required, such approval has been obtained prior to the Closing
Date;
(i) No
Untrue Information.
Neither
this Agreement nor any statement, report or other document furnished or to
be
furnished pursuant to this Agreement or in connection with the transactions
contemplated hereby contains any untrue statement of fact or omits to state
a
fact necessary to make the statements contained therein not
misleading;
(j) Sale
Treatment.
The
Company has determined that the disposition of the Mortgage Loans pursuant
to
this Agreement will be afforded sale treatment for accounting and tax
purposes;
(k) No
Material Change.
There
has
been no material adverse change in the business, operations, financial condition
or assets of the Company since the date of the Company’s most recent financial
statements other than changes disclosed by the Company on Form 8-K filed
with
the Commission;
-22-
(l) No
Brokers’ Fees.
The
Company has not dealt with any broker, investment banker, agent or other
Person
that may be entitled to any commission or compensation in the connection
with
the sale of the Mortgage Loans; and
(m) MERS.
The
Company is a member of MERS in good standing and will comply in all material
respects with the rules and procedures of MERS in connection with the servicing
of the MERS Mortgage Loans for as long as such Mortgage Loans are registered
with MERS.
Section
3.2. Representations
and Warranties Regarding Individual Mortgage Loans.
As
to
each Mortgage Loan, the Company hereby represents and warrants to the Purchaser
and its successors and assigns that as of the Closing Date (except as set
forth
in (i) below):
(i) Mortgage
Loans as Described.
The
information set forth in the Mortgage Loan Schedule is true and correct as
of
the Cut-off Date.
(ii) Payment
History.
All
payments required to be made up to the Cut-off Date for each Mortgage Loan
under
the terms of the Mortgage Note have been made and credited. No payment under
any
Mortgage Loan has been 30 days delinquent more than one time within twelve
months prior to the Closing Date;
(iii) No
Outstanding Charges.
There
are
no defaults by the Company or the Mortgagor in complying with the terms of
the
Mortgage Note or Mortgage, and all taxes, governmental assessments, insurance
premiums, water, sewer and municipal charges, which previously became due
and
owing have been paid, or an escrow of funds has been established for every
such
item which remains unpaid and which has been assessed but is not yet due
and
payable;
(iv) Original
Terms Unmodified.
The
terms
of the Mortgage Note and Mortgage have not been impaired, waived, altered
or
modified in any respect, except by a written instrument which has been recorded,
if necessary to protect the interests of the Purchaser and the lien priority
of
the related Mortgage, and which has been delivered to the Purchaser. The
substance of any such waiver, alteration or modification has been approved
by
the mortgage insurer, if the Mortgage Loan is insured, the title insurer,
to the
extent required by the policy, and its terms are reflected on the Mortgage
Loan
Schedule. No Mortgagor has been released, in whole or in part;
-23-
(v) No
Defenses.
The
Mortgage Loan is not subject to any right of rescission, set-off, counterclaim
or defense, including without limitation the defense of usury, nor will the
operation of any of the terms of the Mortgage Note or the Mortgage, or the
exercise of any right thereunder, render either the Mortgage Note or the
Mortgage unenforceable, in whole or in part, or subject to any right of
rescission, set-off, counterclaim or defense, including without limitation
the
defense of usury, and no such right of rescission, set-off, counterclaim
or
defense has been asserted with respect thereto;
(vi) No
Satisfaction of Mortgage.
The
Mortgage has not been satisfied, canceled, subordinated or rescinded, in
whole
or in part, and the Mortgaged Property has not been released from the lien
of
the Mortgage, in whole or in part, nor has any instrument been executed that
would effect any such satisfaction, release, cancellation, subordination
or
rescission;
(vii) Validity
of Mortgage Documents.
The
Mortgage Note, the Mortgage and related documents are genuine, and each is
the
legal, valid and binding obligation of the maker thereof enforceable in
accordance with its terms. All parties to the Mortgage Note and the Mortgage
had
legal capacity to enter into the Mortgage Loan and to execute and deliver
the
Mortgage Note and the Mortgage, and the Mortgage Note and the Mortgage have
been
duly and properly executed by such parties;
(viii) No
Fraud.
Neither
the Company, nor any of the Company's officers, employees or agents has
committed, made or engaged in any error, omission, misrepresentation,
negligence, fraud or similar occurrence in connection with the origination
of
any Mortgage Loan. No Qualified Correspondent or Third-Party Originator has
committed, made or engaged in any error, omission, misrepresentation,
negligence, fraud or similar occurrence in connection with the origination
of
any Mortgage Loan;
(ix) Compliance
with Applicable Laws.
Any
and
all requirements of any federal, state or local law including, without
limitation, usury, truth-in-lending, real estate settlement procedures, consumer
credit protection, equal credit opportunity and disclosure laws or unfair
and
deceptive practices laws applicable to the Mortgage Loan including, without
limitation, any provisions relating to prepayment penalties, have been complied
with, the consummation of the transactions contemplated hereby will not involve
the violation of any such laws or regulations. 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 predatory, abusive
and fair lending laws. The Company shall maintain in its possession, available
for the Purchaser’s inspection, and shall deliver to the Purchaser upon demand,
evidence of compliance with all such requirements;
-24-
(x) Location
and Type of Mortgaged Property.
The
Mortgaged Property is located in the state identified in the related Mortgage
Loan Schedule and consists of a contiguous parcel of real property with a
detached single family residence erected thereon, or a two- to four-family
dwelling, or an individual condominium unit in a condominium project, or
an
individual unit in a planned unit development;
(xi) Valid
First Lien.
The
Mortgage is a valid, subsisting and enforceable first lien on the Mortgaged
Property, including all buildings on the Mortgaged Property and all
installations and mechanical, electrical, plumbing, heating and air conditioning
systems located in or annexed to such buildings, and all additions, alterations
and replacements made at any time with respect to the foregoing. The lien
of the
Mortgage is subject only to:
(1) the
lien
of current real property taxes and assessments not yet due and
payable;
(2) covenants,
conditions and restrictions, rights of way, easements and other matters of
the
public record as of the date of recording acceptable to mortgage lending
institutions generally and specifically referred to in the lender’s title
insurance policy or attorney’s title opinion delivered to the originator of the
Mortgage Loan and (i) referred to or otherwise considered in the appraisal
made
for the originator of the Mortgage Loan and (ii) which do not adversely affect
the Appraised Value of the Mortgaged Property set forth in such appraisal;
and
(3) other
matters to which like properties are commonly subject which do not materially
interfere with the benefits of the security intended to be provided by the
mortgage or the use, enjoyment, value or marketability of the related Mortgaged
Property;
Any
security agreement, chattel mortgage or equivalent document related to and
delivered in connection with the Mortgage Loan establishes and creates a
valid,
subsisting and enforceable first lien and first priority security interest
on
the property described therein and the Company has full right to sell and
assign
the same to the Purchaser;
(xii) Full
Disbursement of Proceeds.
The
proceeds of the Mortgage Loan have been fully disbursed, except for escrows
established or created due to seasonal weather conditions, and there is no
requirement for future advances thereunder. All costs, fees and expenses
incurred in making or closing the Mortgage Loan and the recording of the
Mortgage were paid, and the Mortgagor is not entitled to any refund of any
amounts paid or due under the Mortgage Note or Mortgage;
(xiii) Ownership.
-25-
The
Company is the sole owner of record and holder of the Mortgage Loan and the
related Mortgage Note and the Mortgage are not assigned or pledged, and the
Company has good and marketable title thereto and has full right and authority
to transfer and sell the Mortgage Loan to the Purchaser. The Company is
transferring the Mortgage Loan free and clear of any and all encumbrances,
liens, pledges, equities, participation interests, claims, charges or security
interests of any nature encumbering such Mortgage Loan;
(xiv) Origination/Doing
Business.
The
Mortgage Loan was originated by a savings and loan association, a savings
bank,
a commercial bank, a credit union, an insurance company, or similar institution
which is supervised and examined by a federal or state authority or by a
mortgagee approved by the Secretary of Housing and Urban Development pursuant
to
Sections 203 and 211 or the National Housing Act. All parties which have
had any
interest in the Mortgage Loan, whether as mortgagee, assignee, pledgee or
otherwise, are (or, during the period in which they held and disposed of
such
interest, were) (1) in compliance with any and all applicable licensing
requirements of the laws of the state wherein the Mortgaged Property is located,
and any qualification requirements of FNMA or ▇▇▇▇▇▇▇ Mac, and (2) organized
under the laws of such state, or (3) qualified to do business in such state,
or
(4) federal savings and loan associations or national banks having principal
offices in such state, or (5) not doing business in such state;
(xv) Title
Insurance.
The
Mortgage Loan is covered by an ALTA lender’s title insurance policy or other
generally acceptable form of policy of insurance acceptable to FNMA or ▇▇▇▇▇▇▇
Mac, issued by a title insurer acceptable to FNMA or ▇▇▇▇▇▇▇ Mac and qualified
to do business in the jurisdiction where the Mortgaged Property is located,
insuring the Company, its successors and assigns, as to the first priority
lien
of the Mortgage in the original principal amount of the Mortgage Loan (subject
only to the exceptions contained in clauses (1), (2) and (3) of paragraph
(xi)
of this Section 3.2) and in the case of ARM Loans against any loss by reason
of
the invalidity or unenforceability of the lien resulting from the provisions
of
such Mortgage provided for adjustment to the applicable Mortgage Interest
Rate
and Monthly Payment; provided, however, that in the case of any Mortgage
Loan
secured by a Mortgaged Property located in a jurisdiction where such policies
are generally not available, the Mortgage Loan is the subject of an opinion
of
counsel of the type customarily rendered in such jurisdiction in lieu of
title
insurance. The Company is the sole insured of such lender’s title insurance
policy, and such lender’s title insurance policy is in full force and effect and
will be in force and effect upon the consummation of the transactions
contemplated by this Agreement. No claims have been made under such lender’s
title insurance policy and no prior holder of the Mortgage, including the
Company, has done, by act or omission, anything which would impair the coverage
of such lender’s title insurance policy. The Company has not done, by act or
omission, anything that would impair the coverage of such lender’s title
insurance policy. In connection with the issuance of such lender’s title
insurance policy no unlawful fee, commission, kickback or other unlawful
compensation or value of any kind has been or will be received, retained
or
realized by any attorney, firm or other person or entity, and no such unlawful
items have been received, retained or realized by the Company;
-26-
(xvi) No
Mechanics’ Liens.
There
are
no mechanics’ or similar liens or claims which have been filed for work, labor
or material (and no rights are outstanding that under the law could give
rise to
such liens) affecting the related Mortgaged Property which are or may be
liens
prior to, or equal or coordinate with, the lien of the related Mortgage which
are not insured against by the title insurance policy referenced in Section
(xv)
above;
(xvii) Location
of Improvements; No Encroachments.
Except
as
insured against by the title insurance policy referenced in Section (xv)
above,
all improvements which were considered in determining the Appraised Value
of the
Mortgaged Property lay wholly within the boundaries and building restriction
lines of the Mortgaged Property and no improvements on adjoining properties
encroach upon the Mortgaged Property. No improvement located on or being
part of
the Mortgaged Property is in violation of any applicable zoning law or
regulation;
(xviii) Customary
Provisions.
The
Mortgage contains customary and enforceable provisions such as to render
the
rights and remedies of the holder thereof adequate for the realization against
the Mortgaged Property of the benefits of the security provided thereby,
including, (i) in the case of a Mortgage designated as a deed of trust, by
trustee’s sale, and (ii) otherwise by judicial foreclosure. There is no
homestead or other exemption available to a Mortgagor which would interfere
with
the right to sell the Mortgaged Property at a trustee’s sale or the right to
foreclose the Mortgage;
(xix) Occupancy
of the Mortgaged Property.
As
of the
date of origination, the Mortgaged Property was lawfully occupied under
Applicable Law;
(xx) No
Additional Collateral.
The
Mortgage Note is not and has not been secured by any collateral, pledged
account
or other security except the lien of the corresponding Mortgage and the security
interest of any applicable security agreement or chattel mortgage referred
to in
(xi) above;
(xxi) Deeds
of Trust.
In
the
event that the Mortgage constitutes a deed of trust, a trustee, duly qualified
under Applicable Law to serve as such, has been properly designated and
currently so serves and is named in the Mortgage, and no fees or expenses
are or
will become payable by the Mortgagee to the trustee under the deed of trust,
except in connection with a trustee’s sale after default by the
Mortgagor;
(xxii) Transfer
of Mortgage Loans.
-27-
The
Assignment is in recordable form and is acceptable for recording under the
laws
of the jurisdiction in which the Mortgaged Property is located;
(xxiii) Mortgaged
Property Undamaged.
The
Mortgaged Property is undamaged by water, fire, earthquake or earth movement,
windstorm, flood, hurricane, tornado or other casualty so as to affect adversely
the value of the Mortgaged Property as security for the Mortgage Loan or
the use
for which the premises were intended;
(xxiv) Collection
Practices; Escrow Deposits.
The
origination and collection practices used with respect to the Mortgage Loan
have
been in accordance with Acceptable Servicing Practices, and have been in
all
material respects legal and proper, and in accordance with the terms of the
Mortgage Note and Mortgage. All Escrow Payments have been collected in full
compliance with state and federal law. An escrow of funds is not prohibited
by
Applicable Law and has been established to pay for every item that remains
unpaid and has been assessed but is not yet due and payable. No escrow deposits
or Escrow Payments or other charges or payments due the Company have been
capitalized under the Mortgage Note;
(xxv) No
Condemnation.
There
is
no proceeding pending or threatened for the total or partial condemnation
of the
related Mortgaged Property;
(xxvi) The
Appraisal.
The
Mortgage Loan Documents contain an appraisal of the related Mortgaged Property
obtained at the time of origination by an appraiser who had no interest,
direct
or indirect, in the Mortgaged Property or in any loan made on the security
thereof; and whose compensation is not affected by the approval or disapproval
of the Mortgage Loan, and the appraisal and the appraiser both satisfy the
applicable requirements of FNMA or ▇▇▇▇▇▇▇ Mac at the time of
appraisal;
-28-
(xxvii) Insurance.
The
Mortgaged Property securing each Mortgage Loan is insured by an insurer
acceptable to FNMA or ▇▇▇▇▇▇▇ Mac against loss by fire and such hazards as
are
covered under a standard extended coverage endorsement, in an amount which
is
not less than the lesser of 100% of the insurable value of the Mortgaged
Property and the outstanding principal balance of the Mortgage Loan, but
in no
event less than the minimum amount necessary to fully compensate for any
damage
or loss on a replacement cost basis; if the Mortgaged Property is a condominium
unit, it is included under the coverage afforded by a blanket policy for
the
project; the insurance policy contains a standard clause naming the originator
of such mortgage loan, its successor and assigns, as insured mortgagee; if
upon
origination of the Mortgage Loan, the improvements on the Mortgaged Property
were in an area identified in the Federal Register by the Federal Emergency
Management Agency as having special flood hazards, a flood insurance policy
meeting the requirements of the current guidelines of the Federal Insurance
Administration is in effect with a generally acceptable insurance carrier,
in an
amount representing coverage not less than the least of (A) the outstanding
principal balance of the Mortgage Loan, (B) the full insurable value and
(C) the
maximum amount of insurance which was available under the Flood Disaster
Protection Act of 1983, as amended; and the Mortgage obligates the mortgagor
thereunder to maintain all such insurance at the mortgagor’s cost and expense
and the Company has not acted or failed to act so as to impair the coverage
of
any such insurance policy or the validity, binding effect and enforceability
thereof;
(xxviii) Servicemembers
Civil Relief Act.
The
Mortgagor has not notified the Company, and the Company has no knowledge
of any
relief requested or allowed to the Mortgagor under the Servicemembers Civil
Relief Act, as amended, or any similar state law;
(xxix) Origination;
Payment Terms.
The
Mortgage Loan was originated by a mortgagee approved by the Secretary of
Housing
and Urban Development pursuant to Sections 203 and 211 of the National Housing
Act, a savings and loan association, a savings bank, a commercial bank, credit
union, insurance company or other similar institution which is supervised
and
examined by a federal or state authority. The documents, instruments and
agreements submitted for loan underwriting were not falsified and contain
no
untrue statement of material fact or omit to state a material fact required
to
be stated therein or necessary to make the information and statements therein
not misleading. No Mortgage Loan contains terms or provisions which would
result
in negative amortization. Principal payments on the Mortgage Loan commenced
no
more than sixty (60) days after funds were disbursed in connection with the
Mortgage Loan. The Mortgage Note is payable in equal monthly installments
of
principal and interest (other than for interest-only Mortgage Loans, which
have
initial periods where no principal is owed by the mortgagor), which installments
of interest, with respect to ARM Loans, are subject to change due to the
adjustments to the Mortgage Interest Rate on each Interest Rate Adjustment
Date,
with interest calculated and payable in arrears, sufficient to amortize the
Mortgage Loan fully by the stated maturity date, over an original term of
not
more than thirty (30) years from commencement of amortization. The Mortgage
Loan
is payable on the first day of each month. There are no Convertible Mortgage
Loans which contain a provision allowing the Mortgagor to convert the Mortgage
Note from an adjustable interest rate Mortgage Note to a fixed interest rate
Mortgage Note. No Mortgage Loan is a balloon mortgage loan that has an original
stated maturity of less than seven (7) years. No Mortgage Loan is a “high cost
home,” “covered” (excluding home loans defined as “covered home loans” in the
New Jersey Home Ownership Security Act of 2002 that were originated between
November 26, 2003 and July 7, 2004), “high risk home” or “predatory” loan under
any applicable state, federal or local law (or a similarly classified loan
using
different terminology under a law imposing heightened regulatory scrutiny
or
additional legal liability for residential mortgage loans having high interest
rates, points and/or fees):
-29-
(xxx) No
Defaults.
Except
with respect to delinquencies identified on the Mortgage Loan Schedule, there
is
no default, breach, violation or event of acceleration existing under any
Mortgage or Mortgage Note and no event that, with the passage of time or
with
notice and the expiration of any grace or cure period, would constitute a
default, breach, violation or event of acceleration, and the Company has
not
waived any default, breach, violation or event of acceleration;
(xxxi) Loan-to-Value
Ratio; Modifications; No Foreclosures.
The
Loan-to-Value Ratio of each Mortgage Loan was less than 125% at the time
of its
origination or refinancing, as applicable. No Mortgage Loan is subject to
a
written foreclosure agreement or pending foreclosure proceedings;
(xxxii) Primary
Mortgage Insurance.
Each
Mortgage Loan with an LTV at origination in excess of 80% will be subject
to a
Primary Mortgage Insurance Policy, issued by an insurer acceptable to FNMA
or
▇▇▇▇▇▇▇ Mac, in at least such amounts as are required by ▇▇▇▇▇▇▇ Mac or FNMA.
All provisions of such Primary Mortgage Insurance Policy have been and are
being
complied with, such policy is in full force and effect, and all premiums
due
thereunder have been paid. Any Mortgage subject to any such Primary Mortgage
Insurance Policy obligates the Mortgagor thereunder to maintain such insurance
and to pay all premiums and charges in connection therewith unless terminable
in
accordance with ▇▇▇▇▇▇▇ Mac standards or Applicable Law;
(xxxiii) Underwriting
Guidelines.
The
Mortgage Loan was underwritten in accordance with the Company’s underwriting
guidelines in effect at the time of origination with exceptions thereto
exercised in a reasonable manner;
(xxxiv) No
Violation of Environmental Laws.
The
Mortgaged Property is in material compliance with all applicable environmental
laws pertaining to environmental hazards including, without limitation,
asbestos, and neither the Company nor the related Mortgagor, has received
any
notice of any violation or potential violation of such law;
(xxxv) Adverse
Selection.
The
Company used no adverse selection procedures in selecting the Mortgage Loan
from
among the outstanding first-lien residential mortgage loans owned by it which
were available for inclusion in the Mortgage Loans;
(xxxvi) No
Bankruptcy.
No
Mortgagor was a debtor in any state or federal bankruptcy or insolvency
proceeding at the time the Mortgage Loan was originated and as of the Closing
Date, the Company has not received notice that any Mortgagor is a debtor
under
any state or federal bankruptcy or insolvency proceeding;
-30-
(xxxvii) No
Additional Payments.
There
is
no obligation on the part of the Company or any other party to make payments
in
addition to those made by the Mortgagor;
(xxxviii) Comparable
Mortgage Loan File.
Each
document or instrument in the related Mortgage File is in a form generally
acceptable to prudent mortgage lenders that regularly originate or purchase
mortgage loans comparable to the Mortgage Loans for sale to prudent investors
in
the secondary market that invest in mortgage loans such as the Mortgage
Loans;
(xxxix) Predatory
Lending Regulations.
No
Mortgage Loan is a High Cost Loan or Covered Loan, as applicable, and no
Mortgage Loan originated on or after October 1, 2002 through March 6,
2003 is governed by the Georgia Fair Lending Act. No Mortgage Loan is covered
by
the Home Ownership and Equity Protection Act of 1994 and no Mortgage Loan
is in
violation of any comparable state or local law. The Mortgaged Property is
not
located in a jurisdiction where a breach of this representation with respect
to
the related Mortgage Loan may result in additional assignee liability to
the
Purchaser, as determined by Purchaser in its reasonable discretion. No predatory
or deceptive lending practices, including, without limitation, the extension
of
credit without regard to the ability of the Mortgagor to repay and the extension
of credit which has no apparent benefit to the Mortgagor, were employed in
the
origination of the Mortgage Loan. Each Mortgage Loan is in compliance with
the
anti-predatory lending eligibility for purchase requirements of ▇▇▇▇▇▇ Mae’s
Selling Guide;
(xl) Fair
Credit Report Act.
As
to
each consumer report (as defined in the Fair Credit Reporting Act, Public
Law
91-508) or other credit information furnished by the Company to the Purchaser,
that the Company has full right and authority and is not precluded by law
or
contract from furnishing such information to the Purchaser and the Purchaser
is
not precluded by the terms of the Mortgage Loan Documents from furnishing
the
same to any subsequent or prospective purchaser of such Mortgage. The Company
shall hold the Purchaser harmless from any and all damages, losses, costs
and
expenses (including attorney’s fees) arising from disclosure of credit
information in connection with the Purchaser’s secondary marketing operations
and the purchase and sale of mortgages. The Company has in its capacity as
servicer, for each Mortgage Loan, fully furnished, in accordance with the
Fair
Credit Reporting Act and its implementing regulations, accurate and complete
information (e.g., favorable and unfavorable) on its borrower credit files
to
Equifax, Experian and Trans Union Credit Information Company (three of the
credit repositories), on a monthly basis. The Servicer will transmit full-file
credit reporting data for each Mortgage Loan pursuant to ▇▇▇▇▇▇ Mae Guide
Announcement 95-19 and that for each Mortgage Loan, Servicer agrees it shall
report one of the following statuses each month as follows: new origination,
current, delinquent (30-, 60-, 90-days, etc.), foreclosed, or
charged-of;
-31-
(xli) Eligible
Products.
With
respect to each Mortgage Loan, the related Mortgagor was not encouraged or
required to select a mortgage loan product offered by the Mortgage Loan’s
originator which is a higher cost product designed for less creditworthy
borrowers unless, at the time of the Mortgage Loan’s origination such Mortgagor
did not qualify for the Mortgage Loan originator’s lower cost products, taking
into account such facts as, without limitation, the Mortgage Loan’s requirements
and the borrower’s credit history, income, assets and liabilities and
debt-to-income ratios;
(xlii) Single-premium
Credit Life Insurance Policy.
In
connection with the origination of any Mortgage Loan, no proceeds from any
Mortgage Loan were used to finance or acquire a single-premium credit life
insurance policy. No Mortgagor was required to purchase any single-premium
credit insurance policy (e.g., life, disability, accident, unemployment,
or
health insurance product) or debt cancellation agreement as a condition of
obtaining the extension of credit. No Mortgagor obtained a prepaid
single-premium credit insurance policy (e.g., life, disability, accident,
unemployment, mortgage, or health insurance) in connection with the origination
of the Mortgage Loan; no proceeds from any Mortgage Loan were used to purchase
single-premium credit insurance policies or debt cancellation agreements
as part
of the origination of, or as a condition to closing, such Mortgage Loan;
(xliii) Prepayment
Penalty.
The
Mortgage Loan is subject to a prepayment penalty as provided in the related
Mortgage Note except as set forth on the Mortgage Loan Schedule. With respect
to
each Mortgage Loan that has a prepayment penalty feature, each such prepayment
penalty is enforceable and will be enforced by the Company for the benefit
of
the Purchaser, and each prepayment penalty is permitted pursuant to federal,
state and local law. Each such prepayment penalty is in an amount not more
than
the maximum amount permitted under applicable law and no such prepayment
penalty
may be imposed for a term in excess of five (5) years with respect to
Mortgage Loans originated prior to October 1, 2002. With respect to Mortgage
Loans originated on or after October 1, 2002, the duration of the
prepayment period shall not exceed three (3) years from the date of the
Mortgage Note unless the Mortgage Loan was modified to reduce the prepayment
period to no more than three (3) years from the date of the note and the
Mortgagor was notified in writing of such reduction in prepayment period.
With
respect to any Mortgage Loan that contains a provision permitting imposition
of
a premium upon a prepayment prior to maturity: (i) prior to the loan’s
origination, the Mortgagor agreed to such premium in exchange for a monetary
benefit, including but not limited to a rate or fee reduction, (ii) prior
to the loan’s origination, the Mortgagor was offered the option of obtaining a
mortgage loan that did not require payment of such a premium, (iii) the
prepayment premium is disclosed to the Mortgagor in the loan documents pursuant
to applicable state, local and federal law, and (iv) notwithstanding any
state, local or federal law to the contrary, the Company shall not impose
such
prepayment premium in any instance when the mortgage debt is accelerated
as the
result of the Mortgagor’s default in making the loan payments;
-32-
(xliv) Qualified
Mortgage.
Each
Mortgage Loan is a “qualified mortgage” within Section 860G(a)(3) of the
Code.
(xlv) No
Mobile Homes or Manufactured Dwellings.
No
Mortgage Loan is secured by a residence or dwelling that is a mobile home
or a
manufactured dwelling;
(xlvi) Compliance
with Anti-Money Laundering Laws.
The
Company has complied with all applicable anti-money laundering laws and
regulations, including without limitation the USA Patriot Act of 2001
(collectively, the “Anti-Money
Laundering Laws”);
the
Company has established an anti-money laundering compliance program as required
by the Anti-Money Laundering Laws, has conducted the requisite due diligence
in
connection with the origination of each Mortgage Loan for purposes of the
Anti-Money Laundering Laws, including with respect to the legitimacy of the
applicable Mortgagor and the origin of the assets used by the said Mortgagor
to
purchase the property in question, and maintains, and will maintain, sufficient
information to identify the applicable Mortgagor for purposes of the Anti-Money
Laundering Laws;
(xlvii) No
“Pledged Asset” Loans.
No
Mortgage Loan is a “pledged asset” mortgage loan;
(xlviii) No
Construction Loans.
No
Mortgage Loan was made in connection with (i) the construction or rehabilitation
of a Mortgaged Property or (ii) facilitating the trade-in or exchange of
a
Mortgaged Property, other than a construction to permanent loan which has
converted to a permanent Mortgage Loan;
(xlix) Mortgagors.
The
Mortgagor with respect to each Mortgage Loan is one or more natural persons
and/or trustees for an Illinois land trust or a trustee under a “living trust”
and such “living trust” is in compliance with FNMA or ▇▇▇▇▇▇▇ Mac guidelines. In
the event a Mortgagor is a trustee, the related borrower is a natural person;
and
(l) Mortgagors.
All
of
the terms of the related Mortgage Note pertaining to interest rate adjustments,
payment adjustments and adjustments of the outstanding principal balance,
if
any, are enforceable and such adjustments will not affect the priority of
the
lien of the related Mortgage; all such adjustments on such Mortgage Loan
have
been made properly and in accordance with the provisions of such Mortgage
Loan;
-33-
(li) Underwriting
Methodology.
The
methodology used in underwriting the extension of credit for each Mortgage
Loan
did not rely solely on the extent of the Mortgagor’s equity in the collateral as
the principal determining factor in approving such extension of credit. The
methodology employed objective criteria that related such facts as, without
limitation, the Mortgagor’s credit history; and the Mortgagor’s income, assets
and liabilities to the proposed mortgage payment and, based on such underwriting
methodology, the Mortgage Loan’s originator made a reasonable determination that
at the time of origination (application/approval) the Mortgagor had a reasonable
ability to make timely payments on the Mortgage Loan;
(lii) Points
and Fees.
All
points and fees related to each Mortgage Loan were disclosed in writing to
the
Mortgagor in accordance with applicable state and federal law and regulation.
Except in the case of a Mortgage Loan in an original principal amount of
less
than $60,000 which would have resulted in an unprofitable origination, no
Mortgagor was charged “points and fees” (whether or not financed) in an amount
greater than 5% of the principal amount of such Mortgage Loan, such 5%
limitation is calculated in accordance with ▇▇▇▇▇▇ Mae’s anti-predatory lending
requirements as set forth in the ▇▇▇▇▇▇ ▇▇▇ Selling Guide;
(liii) Fees
Charges.
All
fees
and charges (including finance charges) and whether or not financed, assessed,
collected or to be collected in connection with the origination and servicing
of
each Mortgage Loan has been disclosed in writing to the Mortgagor in accordance
with applicable state and federal law and regulation; and
(liv) Arbitration.
With
respect to any Mortgage Loan originated on or after August 1, 2004, neither
the
related Mortgage nor the related Mortgage Note requires the Mortgagor to
submit
to arbitration to resolve any dispute arising out of or relating in any way
to
the Mortgage Loan transaction.
Section
3.3. Repurchase.
It
is
understood and agreed that the representations and warranties set forth in
Sections 3.1 and 3.2 shall survive the sale of the Mortgage Loans to the
Purchaser and the delivery of the Mortgage Loan Documents to the Custodian
and
shall inure to the benefit of the Purchaser and its successors and assigns,
notwithstanding any restrictive or qualified endorsement on any Mortgage
Note or
Assignment of Mortgage or the examination or failure to examine any Mortgage
File. Upon discovery by either the Company or the Purchaser of a breach of
any
of the foregoing representations and warranties which materially and adversely
affects the value of the Mortgage Loans or the interest of the Purchaser
(or
which materially and adversely affects the interests of Purchaser in the
related
Mortgage Loan in the case of a representation and warranty relating to a
particular Mortgage Loan), the party discovering such breach shall give prompt
written notice to the other, the Trustee, the Depositor and the Master Servicer.
Notwithstanding anything herein to the contrary, for the purposes of determining
whether a breach of any of the foregoing representations and warranties shall
have occurred, any knowledge qualifier shall be disregarded as if such knowledge
qualification had not been given.
-34-
Within
90
days of the earlier of either discovery by or notice to the Company of any
breach of a representation or warranty which materially and adversely affects
the value of the Mortgage Loans, (i) the Company shall use its best efforts
promptly to cure such breach in all material respects and (ii) if such breach
cannot be cured, the Company shall, at the Purchaser’s option, repurchase such
Mortgage Loan at the Repurchase Price. Notwithstanding the above sentence,
within thirty (30) days of the earlier of either discovery by, or notice
to, the
Company of any breach of the representations or warranties set forth in clauses
(xxxix), (xl), (xlii), (xliii), (xliv) or (liv) of Section
3.2,
the
Company shall repurchase such Mortgage Loan at the Repurchase Price, together
with all expenses incurred by the Purchaser as a result of such repurchase.
In
the event that a breach shall involve any representation or warranty set
forth
in Section 3.1, and such breach cannot be cured within 90 days of the earlier
of
either discovery by or notice to the Company of such breach, all of the Mortgage
Loans shall, at the Purchaser’s option, be repurchased by the Company at the
Repurchase Price. Any repurchase of a Mortgage Loan or Loans pursuant to
the
foregoing provisions of this Section 3.3 shall be accomplished by deposit
in the
Custodial Account of the amount of the Repurchase Price as required in Section
4.4, for distribution to Purchaser on the Remittance Date for the month
following the date of the repurchase, after deducting therefrom any amount
received in respect of such repurchased Mortgage Loan or Loans and being
held in
the Custodial Account for future distribution for application in accordance
with
Section 5.1.
If
pursuant to the foregoing provisions the Company repurchases a Mortgage Loan
that is a MERS Mortgage Loan, the Company shall either (i) cause MERS to
execute
and deliver an assignment of the Mortgage in recordable form to transfer
the
Mortgage from MERS to the Company on behalf of the Purchaser, and shall cause
such Mortgage to be removed from registration on the MERS® System in accordance
with MERS’ rules and regulations or (ii) cause MERS to designate on the MERS®
System the Company as the beneficial holder with respect to such Mortgage
Loan.
At
the
time of repurchase, the Purchaser and the Company shall arrange for the
reassignment of the repurchased Mortgage Loans to the Company and the delivery
to the Company of any documents held by the Custodian relating to the
repurchased Mortgage Loans. In the event of a repurchase, the Company shall,
simultaneously with such reassignment, give written notice to the Purchaser
that
such repurchase has taken place and amend the Mortgage Loan Schedule to reflect
the withdrawal of the repurchased Mortgage Loans from this
Agreement.
In
addition to such repurchase obligation, the Company shall indemnify the
Purchaser and its successors and assigns, and hold them harmless against
any
losses, damages, penalties, fines, forfeitures, reasonable and necessary
legal
fees and related costs, judgments, and other costs and expenses resulting
from
any claim, demand, defense or assertion based on or grounded upon, or resulting
from, a breach of the Company’s representations and warranties contained in this
Agreement. It is understood and agreed that the obligations of the Company
set
forth in this Section 3.3 to cure or repurchase a defective Mortgage Loan
and to
indemnify the Purchaser and its successors and assigns as provided in this
Section 3.3, constitute the sole remedies of the Purchaser respecting a breach
of the foregoing representations and warranties.
-35-
Any
cause
of action against the Company relating to or arising out of the breach of
any
representations and warranties made in Sections 3.1 and 3.2 shall accrue
as to
any Mortgage Loan upon the earliest of (i) discovery of such breach by the
Company or the Purchaser or notice thereof by the Purchaser to the Company,
(ii)
failures by the Company to cure such breach or repurchase such Mortgage Loan
as
specified above, and (iii) demand upon the Company by the Purchaser for
compliance with this Agreement.
ARTICLE
IV
ADMINISTRATION
AND SERVICING OF MORTGAGE LOANS
Section
4.1. Company
to Act as Servicer.
The
Company, as an independent contractor, shall service and administer the Mortgage
Loans and shall have full power and authority, acting alone or through the
utilization of a third party servicing provider, to do any and all things
in
connection with such servicing and administration which the Company may deem
necessary or desirable, consistent with the terms of this Agreement and with
Accepted Servicing Practices.
Consistent
with the terms of this Agreement and subject to the REMIC Provisions if the
Mortgage Loans have been transferred to a REMIC, the Company may waive, modify
or vary any term of any Mortgage Loan, provided the Mortgagor is in default
with
respect to the Mortgage Loan or such default is, in the judgment of the Company,
reasonably foreseeable. In the event of any such modification which permits
the
deferral of interest or principal payments on any Mortgage Loan, the Company
shall, on the Business Day immediately preceding the Remittance Date in any
month in which any such principal or interest payment has been deferred,
deposit
in the Custodial Account from its own funds, in accordance with Section 5.3,
the
difference between (a) such month’s principal and one month’s interest at the
Mortgage Loan Remittance Rate on the unpaid principal balance of such Mortgage
Loan and (b) the amount paid by the Mortgagor. The Company shall be entitled
to
reimbursement for such advances to the same extent as for all other advances
made pursuant to Section 5.3. Without limiting the generality of the foregoing,
the Company shall continue, and is hereby authorized and empowered, to execute
and deliver on behalf of itself and the Purchaser, all instruments of
satisfaction or cancellation, or of partial or full release, discharge and
all
other comparable instruments, with respect to the Mortgage Loans and with
respect to the Mortgaged Properties. If reasonably required by the Company,
the
Purchaser shall furnish the Company with any powers of attorney and other
documents necessary or appropriate to enable the Company to carry out its
servicing and administrative duties under this Agreement.
The
Company shall notify the Purchaser, in writing, of any waiver, modification,
forbearance, postponement, indulgence or amendment with respect to any term
of
any Mortgage Loan and the date thereof, and shall deliver to the Purchaser
(or,
at the direction of the Purchaser, the Custodian) for deposit in the related
Mortgage File, an original counterpart of the agreement relating to such
waiver,
modification, forbearance, postponement, indulgence, assumption or amendment,
promptly (and in any event within ten Business Days) following the execution
thereof; provided, however, that if any such waiver, modification, forbearance,
postponement, indulgence, assumption or amendment is required by applicable
law
to be recorded, the Company (i) shall deliver to the Purchaser (or, at the
direction of the Purchaser, the Custodian) a copy thereof and (ii) shall
deliver
to the Purchaser (or, at the direction of the Purchaser, the Custodian) such
document, with evidence of notification upon receipt thereof from the public
recording office. The Purchaser shall have the right, but not the obligation,
to
waive the application of the Company’s requirement to deliver to the Purchaser
(or, at the direction of the Purchaser, the Custodian) a forbearance agreement
if the Company’s notice to the Purchaser of such forbearance agreement indicates
that the term of such forbearance agreement is for a period of less than
six
months.
-36-
In
servicing and administering the Mortgage Loans, the Company shall employ
procedures (including collection procedures) and exercise the same care that
it
customarily employs and exercises in servicing and administering mortgage
loans
for its own account, giving due consideration to Accepted Servicing Practices
where such practices do not conflict with the requirements of this Agreement,
and the Purchaser’s reliance on the Company.
The
Company is authorized and empowered by the Purchaser, in its own name, when
the
Company believes it appropriate in its reasonable judgment to register any
Mortgage Loan on the MERS® System, or cause the removal from the registration of
any Mortgage Loan on the MERS® System, to execute and deliver, on behalf of the
Purchaser, any and all instruments of assignment and other comparable
instruments with respect to such assignment or re-recording of a Mortgage
in the
name of MERS, solely as nominee for the Purchaser and its successors and
assigns. The Company will comply in all material respects with the rules
and
procedures of MERS in connection with the servicing of the MERS Mortgage
Loans
for as long as such Mortgage Loans are registered with MERS and the Company
shall remain in good standing with MERS.
Section
4.2. Liquidation
of Mortgage Loans.
In
the
event that any payment due under any Mortgage Loan and not postponed pursuant
to
Section 4.1 is not paid when the same becomes due and payable, or in the
event
the Mortgagor fails to perform any other covenant or obligation under the
Mortgage Loan and such failure continues beyond any applicable grace period,
the
Company shall take such action as (1) the Company would take under similar
circumstances with respect to a similar mortgage loan held for its own account
for investment, (2) shall be consistent with Accepted Servicing Practices,
and
(3) the Company shall determine prudently to be in the best interest of
Purchaser. In the event that any payment due under any Mortgage Loan is not
postponed pursuant to Section 4.1 and remains delinquent for a period of
30 days
or any other default continues for a period of 30 days beyond the expiration
of
any grace or cure period, the Company shall commence foreclosure proceedings
and
the Company shall notify the Purchaser in writing of the Company’s intention to
do so. In such connection, the Company shall from its own funds make all
necessary and proper Servicing Advances, provided, however, that the Company
shall not be required to expend its own funds in connection with any foreclosure
or towards the restoration or preservation of any Mortgaged Property, unless
it
shall determine (a) that such preservation, restoration and/or foreclosure
will
increase the proceeds of liquidation of the Mortgage Loan to the Purchaser
after
reimbursement to itself for such expenses and (b) that such expenses will
be
recoverable by it either through Liquidation Proceeds (respecting which it
shall
have priority for purposes of withdrawals from the Custodial Account pursuant
to
Section 4.5) or through Insurance Proceeds (respecting which it shall have
similar priority).
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Notwithstanding
anything to the contrary contained herein, in connection with a foreclosure
or
acceptance of a deed in lieu of foreclosure, in the event the Company has
reasonable cause to believe that a Mortgaged Property is contaminated by
hazardous or toxic substances or wastes, or if the Purchaser otherwise requests
an environmental inspection or review of such Mortgaged Property, such an
inspection or review is to be conducted by a qualified inspector. The cost
for
such inspection or review shall be borne by the Purchaser. Upon completion
of
the inspection or review, the Company shall promptly provide the Purchaser
with
a written report of the environmental inspection.
After
reviewing the environmental inspection report, the Purchaser shall determine
how
the Company shall proceed with respect to the Mortgaged Property. In the
event
(a) the environmental inspection report indicates that the Mortgaged Property
is
contaminated by hazardous or toxic substances or wastes and (b) the Purchaser
directs the Company to proceed with foreclosure or acceptance of a deed in
lieu
of foreclosure, the Company shall be reimbursed for all reasonable costs
associated with such foreclosure or acceptance of a deed in lieu of foreclosure
and any related environmental clean up costs, as applicable, from the related
Liquidation Proceeds, or if the Liquidation Proceeds are insufficient to
fully
reimburse the Company, the Company shall be entitled to be reimbursed from
amounts in the Custodial Account pursuant to Section 4.5 hereof. In the event
the Purchaser directs the Company not to proceed with foreclosure or acceptance
of a deed in lieu of foreclosure, the Company shall be reimbursed for all
Servicing Advances made with respect to the related Mortgaged Property from
the
Custodial Account pursuant to Section 4.5 hereof.
Section
4.3. Collection
of Mortgage Loan Payments.
Continuously
from the date hereof until the principal and interest on all Mortgage Loans
are
paid in full, the Company shall proceed diligently to collect all payments
due
under each of the Mortgage Loans when the same shall become due and payable
in
accordance with Accepted Servicing Practices, and shall, in accordance with
RESPA and applicable state law, take special care in ascertaining and estimating
Escrow Payments and all other charges that will become due and payable with
respect to the Mortgage Loan and the Mortgaged Property, to the end that
the
installments payable by the Mortgagors will be sufficient to pay such charges
as
and when they become due and payable.
Section
4.4. Establishment
of and Deposits to Custodial Account.
The
Company shall segregate and hold all funds collected and received pursuant
to a
Mortgage Loan separate and apart from any of its own funds and general assets
and shall establish and maintain one or more Custodial Accounts, in the form
of
time deposit or demand accounts, titled “SunTrust Mortgage, Inc., in trust for
Deutsche Bank National Trust Company, as Trustee of the STARM Mortgage Loan
Trust 2007-4”, or as otherwise directed in writing by the Purchaser or its
assigns after the Closing Date. The Custodial Account shall be established
with
a Qualified Depository. Upon request of the Purchaser and within ten (10)
days
thereof, the Company shall provide the Purchaser with written confirmation
of
the existence of such Custodial Account. Any funds deposited in the Custodial
Account shall at all times be insured to the fullest extent allowed by
Applicable Law. Funds held in the Custodial Account may only be invested
in
Permitted Investments. Any such Permitted Investment shall mature no later
than
the Business Day immediately preceding the related Remittance Date. Funds
deposited in the Custodial Account may be drawn on by the Company in accordance
with Section 4.5.
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The
Company shall deposit in the Custodial Account within one Business Day (or
two
Business Days in the case of the amounts described in clauses (3) through
(5)
below) of the Company’s receipt, and retain therein, the following collections
received by the Company and payments made by the Company after each Cut-off
Date, other than payments of principal and interest due on or before such
Cut-off Date, or received by the Company prior to the Cut-off Date but allocable
to a period subsequent thereto:
(1) all
payments on account of principal on the Mortgage Loans, including all Principal
Prepayments, but not including Payaheads;
(2) all
payments on account of interest on the Mortgage Loans, adjusted to the Mortgage
Loan Remittance Rate;
(3) all
Liquidation Proceeds;
(4) all
Insurance Proceeds including amounts required to be deposited pursuant to
Section 4.10 (other than proceeds to be held in the Escrow Account and applied
to the restoration or repair of the Mortgaged Property or released to the
Mortgagor in accordance with Section 4.14), Section 4.11 and Section
4.15;
(5) all
Condemnation Proceeds which are not applied to the restoration or repair
of the
Mortgaged Property or released to the Mortgagor in accordance with Section
4.14;
(6) any
amount required to be deposited in the Custodial Account pursuant to Section
4.1, 5.1, 5.3, 6.1 or 6.2;
(7) any
amounts payable in connection with the repurchase of any Mortgage Loan pursuant
to Section 2.3, 3.3 or 6.2;
(8) with
respect to each Principal Prepayment including, for this purpose, the principal
portion of Insurance Proceeds, Condemnation Proceeds, and Liquidation Proceeds
an amount (to be paid by the Company out of its own funds) which, when added
to
all amounts allocable to interest received in connection with the Principal
Prepayment, equals one month’s interest on the amount of principal so prepaid at
the Mortgage Loan Remittance Rate, provided, however, any such deposits by
the
Company related to any Due Period shall not exceed one half of the Servicing
Fee
related to such Due Period;
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(9) any
amounts required to be deposited by the Company pursuant to Section 4.11
in
connection with the deductible clause in any blanket hazard insurance policy;
and
(10) any
amounts received with respect to or related to any REO Property and all REO
Disposition Proceeds pursuant to Section 4.16.
The
foregoing requirements for deposit into the Custodial Account shall be
exclusive, it being understood and agreed that, without limiting the generality
of the foregoing, payments in the nature of late payment charges and assumption
fees, to the extent permitted by Section 6.1, need not be deposited by the
Company into the Custodial Account. Any interest paid on funds deposited
in the
Custodial Account by the depository institution shall accrue to the benefit
of
the Company and the Company shall be entitled to retain and withdraw such
interest from the Custodial Account pursuant to Section 4.5. The Company
shall
reimburse the Custodial Account for any losses incurred as a result of the
investment of amounts on deposit in the Custodial Account.
Section
4.5. Permitted
Withdrawals From Custodial Account.
The
Company shall, from time to time, withdraw funds from the Custodial Account
for
the following purposes:
(1) to
make
payments to the Purchaser in the amounts and in the manner provided for in
Section 5.1;
(2) to
reimburse itself for Monthly Advances of the Company’s funds made pursuant to
Section 5.3, the Company’s right to reimburse itself pursuant to this subclause
(2) being limited to amounts received on the related Mortgage Loan which
represent late payments of principal and/or interest respecting which any
such
advance was made, it being understood that, in the case of any such
reimbursement, the Company’s right thereto shall be prior to the rights of the
Purchaser, except that, where the Company is required to repurchase a Mortgage
Loan pursuant to Section 2.3, 3.3 or 6.2, the Company’s right to such
reimbursement shall be subsequent to the payment to the Purchaser of the
Repurchase Price pursuant to such sections and all other amounts required
to be
paid to the Purchaser with respect to such Mortgage Loan;
(3) to
reimburse itself for unreimbursed Servicing Advances, and for any unpaid
Servicing Fees, the Company’s right to reimburse itself pursuant to this
subclause (3) with respect to any Mortgage Loan being limited to related
Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds and such
other
amounts as may be collected by the Company from the Mortgagor or otherwise
relating to the Mortgage Loan, it being understood that, in the case of any
such
reimbursement, the Company’s right thereto shall be prior to the rights of
Purchaser, except that where the Company is required to repurchase a Mortgage
Loan pursuant to Section 2.3, 3.3 or 6.2, in which case the Company’s right to
such reimbursement shall be subsequent to the payment to the Purchaser of
the
Repurchase Price pursuant to such sections and all other amounts required
to be
paid to the Purchaser with respect to such Mortgage Loan;
-40-
(4) to
pay
itself as servicing compensation any interest on funds deposited in the
Custodial Account;
(5) to
reimburse itself for expenses incurred to the extent reimbursable pursuant
to
Section 8.1;
(6) to
pay
any amount required to be paid pursuant to Section 4.16 related to any REO
Property, it being understood that, in the case of any such expenditure or
withdrawal related to a particular REO Property, the amount of such expenditure
or withdrawal from the Custodial Account shall be limited to amounts on deposit
in the Custodial Account with respect to the related REO Property;
(7) to
reimburse itself for any Servicing Advances or REO expenses after liquidation
of
the Mortgaged Property not otherwise reimbursed above;
(8) to
reimburse the Trustee with respect to the Securitization Transaction for
any
unreimbursed Monthly Advances or Servicing Advances made by the Trustee, as
applicable, the right to reimbursement pursuant to this subclause (8) with
respect to any Mortgage Loan being limited to related Liquidation Proceeds,
proceeds of REO Dispositions, Condemnation Proceeds, Insurance Proceeds and
such
other amounts as may be collected by the Company from the Mortgagor or otherwise
relating to the Mortgage Loan, it being understood that, in the case of such
reimbursement, such trustee’s right thereto shall be prior to the rights of the
Company to reimbursement under (2) and (3), and prior to the rights of the
Purchaser under (1);
(9) to
remove
funds inadvertently placed in the Custodial Account by the Company;
and
(10) to
clear
and terminate the Custodial Account upon the termination of this
Agreement.
In
the
event that the Custodial Account is interest bearing, on each Remittance
Date,
the Company shall withdraw all interest earned on funds on deposit in the
Custodial Account. The Company may use such withdrawn funds only for the
purposes described in this Section 4.5.
Section
4.6. Establishment
of and Deposits to Escrow Account.
The
Company shall segregate and hold all funds collected and received pursuant
to a
Mortgage Loan constituting Escrow Payments separate and apart from any of
its
own funds and general assets and shall establish and maintain one or more
Escrow
Accounts, in the form of time deposit or demand accounts, titled, “SunTrust
Mortgage, Inc., in trust for Deutsche Bank National Trust Company, as Trustee
of
the STARM Mortgage Loan Trust 2007-4.” The Escrow Accounts shall be established
with a Qualified Depository, in a manner which shall provide maximum available
insurance thereunder. Funds held in any Escrow Account may only be invested
in
Permitted Investments. Any such Permitted Investment shall mature no later
than
the Business Day immediately preceding the related Remittance Date. Upon
request
of the Purchaser and within ten (10) days thereof, the Company shall provide
the
Purchaser with written confirmation of the existence of such Escrow Account.
Funds deposited in the Escrow Account may be drawn on by the Company in
accordance with Section 4.7.
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The
Company shall deposit in the Escrow Account or Accounts within two (2) Business
Days of the Company’s receipt, and retain therein:
(1) all
Escrow Payments collected on account of the Mortgage Loans, for the purpose
of
effecting timely payment of any such items as required under the terms of
this
Agreement;
(2) all
amounts representing Insurance Proceeds or Condemnation Proceeds which are
to be
applied to the restoration or repair of any Mortgaged Property; and
(3) all
amounts representing proceeds of any Primary Mortgage Insurance
Policy.
The
Company shall make withdrawals from the Escrow Account only to effect such
payments as are required under this Agreement, as set forth in Section 4.7.
The
Company shall be entitled to retain any interest paid on funds deposited
in the
Escrow Account by the depository institution, other than interest on escrowed
funds required by law to be paid to the Mortgagor. To the extent required
by
law, the Company shall pay interest on escrowed funds to the Mortgagor
notwithstanding that the Escrow Account may be non-interest bearing or that
interest paid thereon is insufficient for such purposes. Notwithstanding
the
forgoing, the Company shall be responsible to reimburse the Purchaser for
any
losses incurred as a result of the investment of amounts on deposit in the
Escrow Account.
Section
4.7. Permitted
Withdrawals From Escrow Account.
Withdrawals
from the Escrow Account or Accounts may be made by the Company
only:
(1) to
effect
timely payments of ground rents, taxes, assessments, water rates, mortgage
insurance premiums, condominium charges, fire and hazard insurance premiums
or
other items constituting Escrow Payments for the related Mortgage;
(2) to
reimburse the Company for any Servicing Advances made by the Company pursuant
to
Section 4.8 with respect to a related Mortgage Loan, but only from amounts
received on the related Mortgage Loan which represent late collections of
Escrow
Payments thereunder;
(3) to
refund
to any Mortgagor any funds found to be in excess of the amounts required
under
the terms of the related Mortgage Loan;
(4) for
transfer to the Custodial Account and application to reduce the principal
balance of the Mortgage Loan in accordance with the terms of the related
Mortgage and Mortgage Note;
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(5) for
application to restoration or repair of the Mortgaged Property in accordance
with the procedures outlined in Section 4.14;
(6) to
pay to
the Company, or any Mortgagor to the extent required by law, any interest
paid
on the funds deposited in the Escrow Account;
(7) to
remove
funds inadvertently placed in the Escrow Account by the Company;
(8) to
apply
the proceeds of Primary Mortgage Insurance as if such proceeds were payments
on,
or Liquidation Proceeds of, the related Mortgage Loan, as the case may be;
and
(9) to
clear
and terminate the Escrow Account on the termination of this
Agreement.
Section
4.8. Payment
of Taxes, Insurance and Other Charges.
With
respect to each Mortgage Loan, the Company shall maintain accurate records
reflecting the status of ground rents, taxes, assessments, water rates, sewer
rents, and other charges which are or may become a lien upon the Mortgaged
Property and fire and hazard insurance coverage and shall obtain, from time
to
time, all bills for the payment of such charges (including renewal premiums)
and
shall effect payment thereof prior to the applicable penalty or termination
date, employing for such purpose deposits of the Mortgagor in the Escrow
Account
which shall have been estimated and accumulated by the Company in amounts
sufficient for such purposes, as allowed under the terms of the Mortgage.
The
Company assumes full responsibility for the timely payment of all such bills
and
shall effect timely payment of all such charges irrespective of each Mortgagor’s
faithful performance in the payment of same of the making of the Escrow
Payments, and the Company shall make advances from its own funds to effect
such
payments.
Section
4.9. Protection
of Accounts.
The
Company may transfer the Custodial Account or the Escrow Account to a different
Qualified Depository from time to time, upon prior written notice to the
Purchaser.
Section
4.10. Maintenance
of Hazard Insurance.
The
Company shall cause to be maintained for each Mortgage Loan hazard insurance
such that all buildings upon the Mortgaged Property are insured by an insurer
acceptable to FNMA or ▇▇▇▇▇▇▇ Mac, against loss by fire, hazards of extended
coverage and such other hazards as are customary in the area where the Mortgaged
Property is located, in an amount which is at least equal to the lesser of
(i)
the maximum insurable value of the improvements securing such Mortgage Loan
and
(ii) the greater of (a) the outstanding principal balance of the Mortgage
Loan
and (b) an amount such that the proceeds thereof shall be sufficient to prevent
the Mortgagor or the loss payee from becoming a co-insurer. In the event
a
hazard insurance policy shall be in danger of being terminated, or in the
event
the insurer shall cease to be acceptable to FNMA or ▇▇▇▇▇▇▇ Mac, the Company
shall notify the Purchaser and the related Mortgagor, and shall use its best
efforts, as permitted by Applicable Law, to obtain from another Qualified
Insurer a replacement hazard insurance policy substantially and materially
similar in all respects to the original policy. In no event, however, shall
a
Mortgage Loan be without a hazard insurance policy at any time, subject only
to
Section 4.11 hereof.
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If
upon
origination of the Mortgage Loan, the related Mortgaged Property was located
in
an area identified by the Flood Emergency Management Agency as having special
flood hazards (and such flood insurance has been made available) a flood
insurance policy meeting the requirements of the current guidelines of the
Federal Insurance Administration is in effect with a generally acceptable
insurance carrier acceptable to FNMA or ▇▇▇▇▇▇▇ Mac, in an amount representing
coverage equal to the lesser of (i) the minimum amount required, under the
terms
of coverage, to compensate for any damage or loss on a replacement cost basis
(or the unpaid balance of the mortgage if replacement cost coverage is not
available for the type of building insured) and (ii) the maximum amount of
insurance which is available under the Flood Disaster Protection Act of 1973,
as
amended.
If
a
Mortgage is secured by a unit in a condominium project, the Company shall
verify
that the coverage required of the owner’s association, including hazard, flood,
liability, and fidelity coverage, is being maintained in accordance with
then
current FNMA or ▇▇▇▇▇▇▇ Mac requirements, secure from the owner’s association
its agreement to notify the Company promptly of any change in the insurance
coverage or of any condemnation or casualty loss that may have a material
effect
on the value of the Mortgaged Property as security.
In
the
event that any Purchaser or the Company shall determine that the Mortgaged
Property should be insured against loss or damage by hazards and risks not
covered by the insurance required to be maintained by the Mortgagor pursuant
to
the terms of the Mortgage, the Company shall communicate and consult with
the
Mortgagor with respect to the need for such insurance and bring to the
Mortgagor’s attention the desirability of protection of the Mortgaged
Property.
All
policies required hereunder shall name the Company as loss payee and shall
be
endorsed with standard or union mortgagee clauses, without contribution,
which
shall provide for at least 30 days prior written notice of any cancellation,
reduction in amount or material change in coverage.
The
Company shall not interfere with the Mortgagor’s freedom of choice in selecting
either his insurance carrier or agent, provided, however, that the Company
shall
not accept any such insurance policies from insurance companies unless such
companies are acceptable to FNMA and ▇▇▇▇▇▇▇ Mac and are licensed to do business
in the jurisdiction in which the Mortgaged Property is located. The Company
shall determine that such policies provide sufficient risk coverage and amounts,
that they insure the property owner, and that they properly describe the
property address.
Pursuant
to Section 4.4, any amounts collected by the Company under any such policies
(other than amounts to be deposited in the Escrow Account and applied to
the
restoration or repair of the related Mortgaged Property, or property acquired
in
liquidation of the Mortgage Loan, or to be released to the Mortgagor, in
accordance with the Company’s normal servicing procedures as specified in
Section 4.14) shall be deposited in the Custodial Account subject to withdrawal
pursuant to Section 4.5.
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Section
4.11. Maintenance
of Primary Mortgage Insurance Policy; Claims.
With
respect to each Mortgage Loan with a LTV in excess of 80%, the Company shall,
without any cost to the Purchaser, maintain or cause the Mortgagor to maintain
in full force and effect a Primary Mortgage Insurance Policy insuring that
portion of the Mortgage Loan in excess of a percentage in conformance with
FNMA
and ▇▇▇▇▇▇▇ Mac requirements. The Company shall pay or shall cause the Mortgagor
to pay the premium thereon on a timely basis, at least until the LTV of such
Mortgage Loan is reduced to 80%, or such amount as required by Applicable
Law,
or such other amount as FNMA and ▇▇▇▇▇▇▇ Mac permits for cancellation of
mortgage insurance. In the event that such Primary Mortgage Insurance Policy
shall be terminated, the Company shall obtain from another insurer a comparable
replacement policy, with a total coverage equal to the remaining coverage
of
such terminated Primary Mortgage Insurance Policy. If the insurer shall cease
to
be a qualified insurer, the Company shall determine whether recoveries under
the
Primary Mortgage Insurance Policy are jeopardized for reasons related to
the
financial condition of such insurer, it being understood that the Company
shall
in no event have any responsibility or liability for any failure to recover
under the Primary Mortgage Insurance Policy for such reason. If the Company
determines that recoveries are so jeopardized, it shall notify the Purchaser
and
the Mortgagor, if required, and obtain from another qualified insurer a
replacement insurance policy. The Company shall not take any action which
would
result in noncoverage under any applicable Primary Mortgage Insurance Policy
of
any loss which, but for the actions of the Company would have been covered
thereunder. In connection with any assumption or substitution agreement entered
into or to be entered into pursuant to Subsection 6.1, the Company shall
promptly notify the insurer under the related Primary Mortgage Insurance
Policy,
if any, of such assumption or substitution of liability in accordance with
the
terms of such Primary Mortgage Insurance Policy and shall take all actions
which
may be required by such insurer as a condition to the continuation of coverage
under such Primary Mortgage Insurance Policy. If such Primary Mortgage Insurance
Policy is terminated as a result of such assumption or substitution of
liability, the Company shall obtain a replacement Primary Mortgage Insurance
Policy as provided above.
In
connection with its activities as servicer, the Company agrees to prepare
and
present, on behalf of itself and the Purchaser, claims to the insurer under
any
Primary Mortgage Insurance Policy in a timely fashion in accordance with
the
terms of such Primary Mortgage Insurance Policy and, in this regard, to take
such action as shall be necessary to permit recovery under any Primary Mortgage
Insurance Policy respecting a defaulted Mortgage Loan. Pursuant to Section
4.6,
any amounts collected by the Company under any Primary Mortgage Insurance
Policy
shall be deposited in the Escrow Account, subject to withdrawal pursuant
to
Section 4.7.
Section
4.12. Maintenance
of Mortgage Impairment Insurance.
In
the
event that the Company shall obtain and maintain a blanket policy insuring
against losses arising from fire and hazards covered under extended coverage
on
all of the Mortgage Loans, then, to the extent such policy provides coverage
in
an amount equal to the amount required pursuant to Section 4.10 and otherwise
complies with all other requirements of Section 4.10, it shall conclusively
be
deemed to have satisfied its obligations as set forth in Section 4.10. The
Company shall prepare and make any claims on the blanket policy as deemed
necessary by the Company in accordance with Accepted Servicing Practices.
Any
amounts collected by the Company under any such policy relating to a Mortgage
Loan shall be deposited in the Custodial Account subject to withdrawal pursuant
to Section 4.5. Such policy may contain a deductible clause, in which case,
in
the event that there shall not have been maintained on the related Mortgaged
Property a policy complying with Section 4.10, and there shall have been
a loss
which would have been covered by such policy, the Company shall deposit in
the
Custodial Account at the time of such loss the amount not otherwise payable
under the blanket policy because of such deductible clause, such amount to
be
deposited from the Company’s funds, without reimbursement therefor. Upon request
of any Purchaser, the Company shall cause to be delivered to such Purchaser
a
certified true copy of such policy and a statement from the insurer thereunder
that such policy shall in no event be terminated or materially modified without
30 days’ prior written notice to such Purchaser.
-45-
Section
4.13. Maintenance
of Fidelity Bond and Errors and Omissions Insurance.
The
Company shall maintain with responsible companies, at its own expense, a
blanket
Fidelity Bond and an Errors and Omissions Insurance Policy, with broad coverage
on all officers, employees or other persons acting in any capacity requiring
such persons to handle funds, money, documents or papers relating to the
Mortgage Loans (“Company
Employees”).
Any
such Fidelity Bond and Errors and Omissions Insurance Policy shall be in
the
form of the Mortgage Banker’s Blanket Bond and shall protect and insure the
Company against losses, including forgery, theft, embezzlement, fraud, errors
and omissions and negligent acts of such Company Employees. Such Fidelity
Bond
and Errors and Omissions Insurance Policy also shall protect and insure the
Company against losses in connection with the release or satisfaction of
a
Mortgage Loan without having obtained payment in full of the indebtedness
secured thereby. No provision of this Section 4.13 requiring such Fidelity
Bond
and Errors and Omissions Insurance Policy shall diminish or relieve the Company
from its duties and obligations as set forth in this Agreement. The minimum
coverage under any such bond and insurance policy shall be at least equal
to the
amounts acceptable to FNMA or ▇▇▇▇▇▇▇ Mac. Upon the request of any Purchaser,
the Company shall cause to be delivered to such Purchaser a certified true
copy
of such fidelity bond and insurance policy and a statement from the surety
and
the insurer that such fidelity bond and insurance policy shall in no event
be
terminated or materially modified without 30 days’ prior written notice to the
Purchaser.
Section
4.14. Inspections.
If
any
Mortgage Loan is more than 75 days delinquent, the Company or its agent
immediately shall inspect the Mortgaged Property and shall conduct subsequent
inspections in accordance with Accepted Servicing Practices or as may be
required by the primary mortgage guaranty insurer. The Company shall keep
a
written report of each such inspection.
-46-
Section
4.15. Restoration
of Mortgaged Property.
The
Company need not obtain the approval of the Purchaser prior to releasing
any
Insurance Proceeds or Condemnation Proceeds to the Mortgagor to be applied
to
the restoration or repair of the Mortgaged Property if such release is in
accordance with Accepted Servicing Practices. For claims greater than $15,000,
at a minimum the Company shall comply with the following conditions in
connection with any such release of Insurance Proceeds or Condemnation
Proceeds:
(i) The
Company shall receive satisfactory independent verification of completion
of
repairs and issuance of any required approvals with respect
thereto;
(ii) the
Company shall take all steps necessary to preserve the priority of the lien
of
the Mortgage, including, but not limited to requiring waivers with respect
to
mechanics’ and materialmen’s liens;
(iii) the
Company shall verify that the Mortgage Loan is not in default; and
(iv) pending
repairs or restoration, the Company shall place the Insurance Proceeds or
Condemnation Proceeds in the Escrow Account.
If
the
Purchaser is named as an additional loss payee, the Company is hereby empowered
to endorse any loss draft issued in respect of such a claim in the name of
the
Purchaser.
Section
4.16. Claims.
In
connection with its activities as servicer, the Company agrees to prepare
and
present, on behalf of itself and the Purchaser, claims to the insurer in
a
timely fashion and, in this regard, to take such action as shall be necessary
to
permit recovery respecting a defaulted Mortgage Loan. Pursuant to Section
4.4,
any amounts collected by the Company under any guaranty shall be deposited
in
the Custodial Account, subject to withdrawal pursuant to Section
4.5.
Section
4.17. Title,
Management and Disposition of REO Property.
In
the
event that title to any Mortgaged Property is acquired in foreclosure or
by deed
in lieu of foreclosure, the deed or certificate of sale shall be taken in
the
name of the Company, or in the event the Company is not authorized or permitted
to hold title to real property in the state where the REO Property is located,
or would be adversely affected under the “doing business” or tax laws of such
state by so holding title, or the perfection of the ownership or security
interest of the Purchaser in such REO Property would be adversely effected,
the
deed or certificate of sale shall be taken in the name of such Person or
Persons
as shall be consistent with an Opinion of Counsel obtained by the Company
from
any attorney duly licensed to practice law in the state where the REO Property
is located. The Person or Persons holding such title other than the Purchaser
shall acknowledge in writing that such title is being held as nominee for
the
Purchaser.
-47-
The
Company shall manage, conserve, protect and operate each REO Property for
the
Purchaser solely for the purpose of its prompt disposition and sale. The
Company, either itself or through an agent selected by the Company, shall
manage, conserve, protect and operate the REO Property in the same manner
that
it manages, conserves, protects and operates other foreclosed property for
its
own account, and in the same manner that similar property in the same locality
as the REO Property is managed. The Company shall attempt to sell the same
(and
may temporarily rent the same for a period not greater than one year, except
as
otherwise provided below) on such terms and conditions as the Company deems
to
be in the best interest of the Purchaser.
The
Company shall use its best efforts to dispose of the REO Property as soon
as
possible and shall sell such REO Property in any event within three years
after
title has been taken to such REO Property, unless (i) a REMIC election has
not
been made with respect to the arrangement under which the Mortgage Loans
and the
REO Property are held, and (ii) the Company determines, and gives an appropriate
notice to the Purchaser to such effect, that a longer period is necessary
for
the orderly liquidation of such REO Property; provided however, that the
Company
agrees not to sell or dispose of any such Mortgage Loan to a person who acquires
such Mortgage Loan using a purchase money mortgage. If a period longer than
one
year is permitted under the foregoing sentence and is necessary to sell any
REO
Property, the Company shall report monthly to the Purchaser as to the progress
being made in selling such REO Property.
The
Company shall also maintain on each REO Property fire and hazard insurance
with
extended coverage in an amount which is at least equal to the maximum insurable
value of the improvements which are a part of such property, liability insurance
and, to the extent required and available under the Flood Disaster Protection
Act of 1973, as amended, flood insurance in the amount required
above.
The
disposition of REO Property shall be carried out by the Company at such price,
and upon such terms and conditions, as the Company deems to be in the best
interests of the Purchaser. The proceeds of sale of the REO Property shall
be
promptly deposited in the Custodial Account. As soon as practical thereafter
the
expenses of such sale shall be paid and the Company shall reimburse itself
for
any related unreimbursed Servicing Advances, unpaid Servicing Fees and
unreimbursed advances made pursuant to Section 5.3. On the Remittance Date
immediately following the Principal Prepayment Period in which such sale
proceeds are received the net cash proceeds of such sale remaining in the
Custodial Account shall be distributed to the Purchaser.
The
Company shall withdraw the Custodial Account funds necessary for the proper
operation management and maintenance of the REO Property, including the cost
of
maintaining any hazard insurance pursuant to Section 4.10 and the fees of
any
managing agent of the Company, or the Company itself. The Company shall make
monthly distributions on each Remittance Date to the Purchaser of the net
cash
flow from the REO Property (which shall equal the revenues from such REO
Property net of the expenses described in the Section 4.16 and of any reserves
reasonably required from time to time to be maintained to satisfy anticipated
liabilities for such expenses).
-48-
Section
4.18. Real
Estate Owned Reports.
Together
with the statement furnished pursuant to Section 5.2, the Company shall furnish
to the Purchaser on or before the Remittance Date each month a statement
with
respect to any REO Property covering the operation of such REO Property for
the
previous month and the Company’s efforts in connection with the sale of such REO
Property and any rental of such REO Property incidental to the sale thereof
for
the previous month. That statement shall be accompanied by such other
information as the Purchaser shall reasonably request.
Section
4.19. Liquidation
Reports.
Upon
the
foreclosure sale of any Mortgaged Property or the acquisition thereof by
the
Purchaser pursuant to a deed in lieu of foreclosure, the Company shall submit
to
the Purchaser a liquidation report with respect to such Mortgaged
Property.
Section
4.20. Reports
and Returns to be Filed.
The
Company shall file information reports with respect to the receipt of mortgage
interest received in a trade or business, reports of foreclosures and
abandonments of any Mortgaged Property and information returns relating to
cancellation of indebtedness income with respect to any Mortgaged Property
as
required by Sections 6050H, 6050J and 6050P of the Code. Such reports shall
be
in form and substance sufficient to meet the reporting requirements imposed
by
such Sections 6050H, 6050J and 6050P of the Code.
Section
4.21. Fair
Credit Reporting Act.
For
each
Mortgage Loan, the Servicer shall furnish, in accordance with the Fair Credit
Reporting Act and its implementing regulations, accurate and complete
information (e.g., favorable and unfavorable) on its borrower credit files,
to
Equifax, Experian, and Trans Union Credit Information Company, or their
successors, on a monthly basis. The Servicer shall provide evidence of such
monthly reporting to Purchaser upon request.
Section
4.22. Disaster
Recovery/Business Continuity Plan.
The
Company shall establish and maintain contingency plans, recovery plans and
proper risk controls to ensure Company’s continued performance under this
Agreement. The plans shall include, but not be limited to, testing, control
functions, accountability and corrective actions to be immediately implemented,
if necessary. The Company agrees to make copies or summaries of the plans
available to the Purchaser’s regulators upon request.
Section
4.23. MERS.
In
the
case of each MERS Mortgage Loan, the Company shall, as soon as practicable
after
the Purchaser’s request (but in no event more than 30 days thereafter with
respect to each Mortgage Loan that was a MERS Mortgage Loan as of the Closing
Date, or 90 days thereafter with respect to each Mortgage Loan that was a
MERS
Eligible Mortgage Loan as of the Closing Date and subsequent to the Closing
Date
becomes a MERS Mortgage Loan), the Company shall take such actions as are
necessary to cause the Purchaser to be clearly identified as the owner of
each
MERS Mortgage Loan on the records of MERS for purposes of the system of
recording transfers of beneficial ownership of mortgages maintained by MERS.
Each of the Purchaser and the Company shall maintain in good standing its
membership in MERS. In addition, each of the Purchaser and the Company shall
comply with all rules, policies and procedures of MERS, including the rules
of
membership, as amended, and the MERS procedures manual, as amended. With
respect
to all MERS Mortgage Loans serviced hereunder, the Company shall promptly
notify
MERS as to any transfer of beneficial ownership or release of any security
interest in such Mortgage Loans. The Company shall cooperate with the Purchaser
and any successor owner or successor servicer to the extent necessary to
ensure
that any transfer of ownership or servicing is appropriately reflected on
the
MERS system.
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ARTICLE
V
PAYMENTS
TO PURCHASER
Section
5.1. Remittances.
On
each
Remittance Date the Company shall remit by wire transfer of immediately
available funds to the Purchaser (a) all amounts deposited in the Custodial
Account as of the close of business on the Determination Date (net of charges
against or withdrawals from the Custodial Account pursuant to Section 4.5),
plus
(b) all amounts, if any, which the Company is obligated to distribute pursuant
to Section 5.3, minus (c) any amounts attributable to Principal Prepayments
received after the applicable Principal Prepayment Period which amounts shall
be
remitted on the following Remittance Date, together with any additional interest
required to be deposited in the Custodial Account in connection with such
Principal Prepayment in accordance with Section 4.4(viii); and minus (d)
any
amounts attributable to Monthly Payments collected but due on a Due Date
or
Dates subsequent to the first day of the month of the Remittance
Date.
With
respect to any remittance received by the Purchaser after the date on which
such
payment was due, the Company shall pay to the Purchaser interest on any such
late payment at an annual rate equal to the Prime Rate, adjusted as of the
date
of each charge, plus two percentage points, but in no event greater than
the
maximum amount permitted by Applicable Law. Such interest shall be deposited
in
the Custodial Account by the Company on the date such late payment is made
and
shall cover the period commencing with the day following such second Business
Day and ending with the Business Day on which such payment is made, both
inclusive. Such interest shall be remitted along with the distribution payable
on the next succeeding Remittance Date. The payment by the Company of any
such
interest shall not be deemed an extension of time for payment or a waiver
of any
Event of Default by the Company.
Section
5.2. Statements
to Purchaser.
Not
later
than the Remittance Advice Date, the Company shall furnish to the Purchaser
a
Monthly Remittance Advice, including the information set forth in Exhibit
E
attached hereto, with a trial balance report attached thereto, as to the
period
ending on the last day of the preceding month, in a form to be agreed upon
by
the Purchaser and the Company.
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Section
5.3. Monthly
Advances by Company.
On
the
Business Day immediately preceding each Remittance Date, the Company shall
deposit in the Custodial Account from its own funds or from amounts held
for
future distribution an amount equal to all Monthly Payments (with interest
adjusted to the Mortgage Loan Remittance Rate) which were due on the Mortgage
Loans during the applicable Due Period and which were delinquent at the close
of
business on the Determination Date immediately preceding such Remittance
Date or
which were deferred pursuant to Section 4.1. Any amounts held for future
distribution and so used shall be replaced by the Company by deposit in the
Custodial Account on or before any future Remittance Date if funds in the
Custodial Account on such Remittance Date shall be less than payments to
the
Purchaser required to be made on such Remittance Date. The Company shall
have
the right to deduct delinquent payments from amounts held for future
distribution as long as the Company, its parent, or their respective successors
hereunder has a long-term credit rating of at least “A” by Fitch, Inc. (doing
business as Fitch Ratings), “A” by Standard & Poor’s Ratings Group, a
division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., and “A2” by ▇▇▇▇▇’▇ Investors
Service, Inc. If the long-term credit rating of the Company, its parent,
or
their respective successors hereunder are at any time below the ratings set
forth in the directly preceding sentence, the Company shall no longer be
permitted to make any advances from amounts held for future distribution,
and
instead shall be required to make all advances from its own funds. The Company’s
obligation to make such Monthly Advances as to any Mortgage Loan will continue
through the last Monthly Payment due prior to the payment in full of the
Mortgage Loan, or through the earlier of: (i) the last Remittance Date prior
to
the Remittance Date for the distribution of all Liquidation Proceeds and
other
payments or recoveries (including Insurance Proceeds and Condemnation Proceeds)
with respect to the Mortgage Loan and (ii) the Remittance Date prior to the
date
the Mortgage Loan is converted to REO Property, provided, however, that if
requested by a Rating Agency in connection with the Securitization Transaction,
the Company shall be obligated to make such advances through the Remittance
Date
prior to the date on which cash is received in connection with the liquidation
of REO Property; provided, however, that such obligation shall cease if the
Company determines, in its sole reasonable opinion, that advances with respect
to such Mortgage Loan are non-recoverable by the Company from Liquidation
Proceeds, Insurance Proceeds, Condemnation Proceeds, or otherwise with respect
to a particular Mortgage Loan. In the event that the Company determines that
any
such advances are non-recoverable, the Company shall provide the Purchaser
with
a certificate signed by two officers of the Company evidencing such
determination.
ARTICLE
VI
GENERAL
SERVICING PROCEDURES
Section
6.1. Transfers
of Mortgaged Property.
The
Company shall use its best efforts to enforce any “due-on-sale” provision
contained in any Mortgage or Mortgage Note and to deny assumption by the
person
to whom the Mortgaged Property has been or is about to be sold whether by
absolute conveyance or by contract of sale, and whether or not the Mortgagor
remains liable on the Mortgage and the Mortgage Note. When the Mortgaged
Property has been conveyed by the Mortgagor, the Company shall, to the extent
it
has knowledge of such conveyance, exercise its rights to accelerate the maturity
of such Mortgage Loan under the “due-on-sale” clause applicable thereto,
provided, however, that the Company shall not exercise such rights if prohibited
by law from doing so.
-51-
If
the
Company reasonably believes it is unable under Applicable Law to enforce
such
“due-on-sale” clause, the Company shall enter into (i) an assumption and
modification agreement with the person to whom such property has been conveyed,
pursuant to which such person becomes liable under the Mortgage Note and
the
original Mortgagor remains liable thereon or (ii) in the event the Company
is
unable under Applicable Law to require that the original Mortgagor remain
liable
under the Mortgage Note and the Company has the prior consent of the primary
mortgage guaranty insurer, a substitution of liability agreement with the
purchaser of the Mortgaged Property pursuant to which the original Mortgagor
is
released from liability and the purchaser of the Mortgaged Property is
substituted as Mortgagor and becomes liable under the Mortgage Note. The
Company
shall notify the Purchaser that any such substitution of liability or assumption
agreement has been completed by forwarding to the Purchaser the original
of any
such substitution of liability or assumption agreement, which document shall
be
added to the related Mortgage File and shall, for all purposes, be considered
a
part of such Mortgage File to the same extent as all other documents and
instruments constituting a part thereof. If an assumption fee is collected
by
the Company for entering into an assumption agreement the fee will be retained
by the Company as additional servicing compensation. In connection with any
such
assumption, neither the Mortgage Interest Rate borne by the related Mortgage
Note, the term of the Mortgage Loan, the outstanding principal amount of
the
Mortgage Loan nor any other material terms shall be changed without Purchaser’s
consent.
To
the
extent that any Mortgage Loan is assumable, the Company shall inquire diligently
into the credit worthiness of the proposed transferee, and shall use the
underwriting criteria for approving the credit of the proposed transferee
which
are used with respect to underwriting mortgage loans of the same type as
the
Mortgage Loans. If the credit of the proposed transferee does not meet such
underwriting criteria, the Company diligently shall, to the extent permitted
by
the Mortgage or the Mortgage Note and by Applicable Law, accelerate the maturity
of the Mortgage Loan.
Section
6.2. Satisfaction
of Mortgages and Release of Mortgage Files.
Upon
the
payment in full of any Mortgage Loan, the Company shall notify the Purchaser
in
the Monthly Remittance Advice as provided in Section 5.2, and may request
the
release of any Mortgage Loan Documents.
If
the
Company satisfies or releases a Mortgage without first having obtained payment
in full of the indebtedness secured by the Mortgage or should the Company
otherwise prejudice any rights the Purchaser may have under the mortgage
instruments, upon written demand of the Purchaser, the Company shall repurchase
the related Mortgage Loan at the Repurchase Price by deposit thereof in the
Custodial Account within 2 Business Days of receipt of such demand by the
Purchaser. The Company shall maintain the Fidelity Bond and Errors and Omissions
Insurance Policy as provided for in Section 4.12 insuring the Company against
any loss it may sustain with respect to any Mortgage Loan not satisfied in
accordance with the procedures set forth herein.
-52-
Section
6.3. Servicing
Compensation.
As
compensation for its services hereunder, the Company shall be entitled to
withdraw from the Custodial Account or to retain from interest payments on
the
Mortgage Loans the amount of its Servicing Fee. The Servicing Fee shall be
payable monthly and shall be computed on the basis of the same unpaid scheduled
principal balance and for the period respecting which any related interest
payment on a Mortgage Loan is computed. The obligation of the Purchaser to
pay
the Servicing Fee is limited to, and payable solely from, the interest portion
of such Monthly Payments.
Additional
servicing compensation in the form of assumption fees, to the extent provided
in
Section 6.1, and late payment charges shall be retained by the Company to
the
extent not required to be deposited in the Custodial Account. The Company
shall
be required to pay all expenses incurred by it in connection with its servicing
activities hereunder and shall not be entitled to reimbursement thereof except
as specifically provided for herein.
Section
6.4. [Reserved]
Section
6.5. [Reserved]
Section
6.6. Right
to Examine Company Records.
The
Purchaser, or its designee, shall have the right to examine and audit any
and
all of the books, records, or other information of the Company, whether held
by
the Company or by another on its behalf, with respect to or concerning this
Agreement or the Mortgage Loans, during business hours or at such other times
as
may be reasonable under applicable circumstances, upon reasonable advance
notice. The Purchaser shall pay its own travel expenses associated with such
examination.
Section
6.7. Compliance
with REMIC Provisions.
If
a
REMIC election has been made with respect to the arrangement under which
the
Mortgage Loans and REO Property are held, the Company shall not take any
action,
cause the REMIC to take any action or fail to take (or fail to cause to be
taken) any action that, under the REMIC Provisions, if taken or not taken,
as
the case may be, could (i) endanger the status of the REMIC as a REMIC or
(ii)
result in the imposition of a tax upon the REMIC (including but not limited
to
the tax on “prohibited transactions” as defined Section 860F(a)(2) of the Code
and the tax on “contributions” to a REMIC set forth in Section 860G(d) of the
Code) unless the Company has received an Opinion of Counsel (at the expense
of
the party seeking to take such action) to the effect that the contemplated
action will not endanger such REMIC status or result in the imposition of
any
such tax.
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ARTICLE
VII
COMPANY
TO COOPERATE
Section
7.1. Provision
of Information.
During
the term of this Agreement, the Company shall furnish to the Purchaser such
periodic, special, or other reports or information, and copies or originals
of
any documents contained in the Servicing File for each Mortgage Loan provided
for herein. All other special reports or information not provided for herein
as
shall be necessary, reasonable, or appropriate with respect to the Purchaser
or
any regulatory agency will be provided at the Purchaser’s expense. All such
reports, documents or information shall be provided by and in accordance
with
all reasonable instructions and directions which the Purchaser may
give.
The
Company shall execute and deliver all such instruments and take all such
action
as the Purchaser may reasonably request from time to time, in order to
effectuate the purposes and to carry out the terms of this
Agreement.
Section
7.2. [Reserved]
Section
7.3. Cooperation
with Third-party Service Providers.
The
Company shall cooperate with the Purchaser in servicing the Mortgage Loans
in
accordance with the usual and customary requirements of any credit enhancement,
risk management and other service providers and shall otherwise cooperate
with
the Purchaser in connection with such third-party service providers and the
provision of third-party services; provided, however, that such requirements
are
reasonably acceptable to the Company and pose no greater risk, obligation
or
expense to the Company than otherwise set forth in this Agreement. Any
additional costs and/or expenses will be paid by the requesting
party.
ARTICLE
VIII
THE
COMPANY
Section
8.1. Indemnification;
Third Party Claims.
The
Company shall indemnify the Purchaser and hold it harmless against any and
all
claims, losses, damages, penalties, fines, forfeitures, reasonable and necessary
legal fees actually incurred and related costs, judgments, and any other
costs,
fees and expenses that the Purchaser may sustain in any way related to the
failure of the Company to perform its duties and service the Mortgage Loans
in
strict compliance with the terms of this Agreement. The Company immediately
shall notify the Purchaser if a claim is made by a third party with respect
to
this Agreement or the Mortgage Loans, assume (with the prior written consent
of
the Purchaser) the defense of any such claim and pay all expenses in connection
therewith, including reasonable counsel fees, and promptly pay, discharge
and
satisfy any judgment or decree which may be entered against it or the Purchaser
in respect of such claim. The Company shall follow any written instructions
received from the Purchaser in connection with such claim. The Purchaser
promptly shall reimburse the Company for all costs, fees or expenses advanced
by
it pursuant to this paragraph except when the claim in any way results from,
relates to or arises out of any liability, obligation, act or omission of
the
Company, including without limitation, the Company’s indemnification obligation
under Section 3.3 and this Section 8.1, any repurchase obligation of the
Company
hereunder including Sections 2.3, 3.3 and 6.2, or the failure of the Company
to
service and administer the Mortgage Loans and otherwise perform its obligations
hereunder in strict compliance with the terms of this Agreement.
-54-
Section
8.2. Merger
or Consolidation of the Company.
Except
in
the event of a merger or consolidation as set forth in the second paragraph
of
this Section 8.2, the Company shall keep in full effect its existence, rights
and franchises as a corporation, and shall obtain and preserve its qualification
to do business as a foreign corporation in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Agreement or any of the Mortgage Loans and to perform
its
duties under this Agreement.
Any
Person into which the Company may be merged or consolidated, or any corporation
resulting from any merger, conversion or consolidation (including by means
of
the sale of all or substantially all of the Company’s assets to such Person) to
which the Company shall be a party, or any Person succeeding to the business
of
the Company (whether or not related to loan servicing), shall be the successor
of the Company hereunder, without the execution or filing of any paper or
any
further act on the part of any of the parties hereto, so long as (i) such
merger, conversion or consolidation, sale or other disposition, does not
result
in an Event of Default under Section 10.01 hereof with respect to such successor
Company or (ii) such successor has (a) a residential primary servicer rating
for
servicing of mortgage loans issued by Standard & Poor’s Rating Services, a
division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., Fitch, Inc. or ▇▇▇▇▇’▇ Investors
Service, Inc. above “average” or its equivalent or (b) a net worth of more than
$25,000,000.
Section
8.3. Limitation
on Liability of Company and Others.
Neither
the Company nor any of the directors, officers, employees or agents of the
Company shall be under any liability to the Purchaser for any action taken
or
for refraining from the taking of any action in good faith pursuant to this
Agreement, or for errors in judgment, provided, however, that this provision
shall not protect the Company or any such person against any breach of
warranties or representations made herein, or failure to perform its obligations
in strict compliance with any standard of care set forth in this Agreement
or
any other liability which would otherwise be imposed under this Agreement.
The
Company and any director, officer, employee or agent of the Company may rely
in
good faith on any document of any kind prima facie properly executed and
submitted by any Person respecting any matters arising hereunder. The Company
shall not be under any obligation to appear in, prosecute or defend any legal
action which is not incidental to its duties to service the Mortgage Loans
in
accordance with this Agreement and which in its opinion may involve it in
any
expense or liability, provided, however, that the Company may, with the consent
of the Purchaser, undertake any such action which it may deem necessary or
desirable in respect to this Agreement and the rights and duties of the parties
hereto. In such event, the Company shall be entitled to reimbursement from
the
Purchaser of the reasonable legal expenses and costs of such action, unless
any
such costs result from a breach of the Company’s representations and warranties
made herein or its failure to perform its obligations in compliance with
this
Agreement.
-55-
Section
8.4. Limitation
on Resignation and Assignment by Company.
The
Purchaser has entered into this Agreement with the Company and subsequent
Purchasers will purchase the Mortgage Loans in reliance upon the independent
status of the Company, and the representations as to the adequacy of its
servicing facilities, plant, personnel, records and procedures, its integrity,
reputation and financial standing, and the continuance thereof. Therefore,
subject to the requirements of Section 11.4, the Company shall neither assign
this Agreement or the servicing hereunder, nor delegate its rights or duties
hereunder or any portion hereof, nor sell or otherwise dispose of all of
its
property or assets without the prior written consent of the Purchaser, which
consent shall not be unreasonably withheld.
The
Company shall not resign from the obligations and duties hereby imposed on
it
except by mutual consent of the Company and the Purchaser or upon the
determination that its duties hereunder are no longer permissible under
Applicable Law and such incapacity cannot be cured by the Company. Any such
determination permitting the resignation of the Company shall be evidenced
by an
Opinion of Counsel to such effect delivered to the Purchaser which Opinion
of
Counsel shall be in form and substance acceptable to the Purchaser. No such
resignation shall become effective until a successor shall have assumed the
Company’s responsibilities and obligations hereunder in the manner provided in
Section 12.1.
Without
in any way limiting the generality of this Section 8.4, in the event that
the
Company either shall assign this Agreement or the servicing responsibilities
hereunder or delegate its duties hereunder or any portion thereof; or sell
or
otherwise dispose of all or substantially all of its property or assets without
the prior written consent of the Purchaser, then the Purchaser shall have
the
right to terminate this Agreement upon notice given as set forth in Section
10.1, without any payment of any penalty or damages and without any liability
whatsoever to the Company or any third party.
ARTICLE
IX
SECURITIZATION
TRANSACTION
Section
9.1. Removal
of Mortgage Loans from Inclusion Under this Agreement Upon the Securitization
Transaction. The
Purchaser and the Company agree that with respect to all of the Mortgage
Loans,
the Purchaser shall effect the Securitization Transaction, retaining the
Company
as the Servicer thereof or subservicer if a master servicer is employed,
or as
applicable the “seller/servicer”. From and after the Closing Date, the Mortgage
Loans transferred shall remain covered by this Agreement, insofar as the
Company
shall continue to service such Mortgage Loans on behalf of the Purchaser
in
accordance with the terms of this Agreement.
The
Company shall cooperate with the Purchaser in connection with the Securitization
Transaction in accordance with this Section 9.1. In connection therewith
the
Company shall:
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(a) cooperate
with the Purchaser, the Depositor and the Trustee to satisfy, in connection
with
the Securitization Transaction, the Trust’s reporting obligations under the
Exchange Act and Applicable Law;
(b) represent
to the Purchaser, the Depositor, the Trustee, and the initial purchaser of
the
securities issued in connection with the Securitization Transaction: (1)
that
the Company has serviced the Mortgage Loans in accordance with the terms
of this
Agreement, and has otherwise complied with all covenants and obligations
hereunder, and (2) that the Company has taken no action that would, nor omitted
to take any required action the omission of which would, have the effect
of
impairing the mortgage insurance or guarantee on the Mortgage Loans. The
Company
also represents the accuracy of any information provided to the Purchaser
by the
Company for inclusion in any prospectus supplement, offering memorandum,
term
sheet supplement or term sheet prepared in connection with the Securitization
Transaction;
(c) deliver
an opinion of counsel (which can be an opinion of in-house counsel to the
Company) reasonably acceptable to the Purchaser;
(d) provide
as applicable:
(i) any
and
all information and appropriate verification of information which may be
reasonably available to the Company, whether through letters of its auditors
and
counsel or otherwise, as the Purchaser shall request;
(ii) (x)
the
Annual Certification executed by a senior officer of the Company responsible
for
the servicing of the Mortgage Loans; and (y) such additional statements,
certificates or other similar documents of the Company or reports from the
Company’s accountants in connection with the Securitization Transaction and in
substance as required by Applicable Law; and
(iii) such
additional representations, warranties, covenants, opinions of counsel, letters
from auditors, financial description of the Company as servicer for inclusion
in
any offering memorandum to be distributed to potential investors in connection
with the Securitization Transaction with respect to the Mortgage Loans, and
certificates of public officials or officers of the Company as are reasonably
believed necessary by the Trustee, any Rating Agency, the Purchaser, as the
case
may be, in connection with the Securitization Transaction; and
(e) indemnify
the Purchaser for any material misstatements contained in the information
provided pursuant to (b) or (d) above.
The
Company shall prepare an Assignment in blank or, at the option of the Purchaser,
to the Trustee from the Company (to the extent such Assignment has not been
prepared on or before such Closing Date) acceptable to the Trustee for each
Mortgage Loan that is part of the Securitization Transaction. The Purchaser
shall pay all preparation and recording costs associated therewith. The Company
shall execute each Assignment, track such Assignments to ensure they have
been
recorded and deliver them as required by the Trustee upon the Company’s receipt
thereof. Additionally, the Company shall prepare and execute, at the direction
of the Purchaser, any note endorsements.
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Section
9.2. Redemption
of Certificates.
As
provided in Section 4.03 of the Trust Agreement, the Servicer shall have
the
right to repurchase the Certificates on any Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans is equal to or less
than 1% of the aggregate Scheduled Principal Balance of the Mortgage Loans
as of
the Cut-Off Date (provided, that if the Company is no longer acting as a
Servicer of the Mortgage Loans, the Depositor may request the Master Servicer
to
purchase or arrange for the purchase of the Mortgage Loans and all other
property of the Trust in a Terminating Purchase).
ARTICLE
X
DEFAULT
Section
10.1. Events
of Default.
Each
of
the following shall constitute an Event of Default on the part of the
Company:
(i) any
failure by the Company to remit to the Purchaser any payment required to
be made
under the terms of this Agreement which continues unremedied for a period
of
three Business Days after the date upon which written notice of such failure,
requiring the same to be remedied, shall have been given to the Company by
the
Purchaser; or
(ii) failure
by the Company duly to observe or perform in any material respect any other
of
the covenants or agreements on the part of the Company set forth in this
Agreement which continues unremedied for a period of 30 days after the date
on
which written notice of such failure, requiring the same to be remedied,
shall
have been given to the Company by the Purchaser or by the Custodian;
or
(iii) failure
by the Company to maintain its license to do business in any jurisdiction
where
the Mortgaged Property is located if such license is required; or
(iv) a
decree
or order of a court or agency or supervisory authority having jurisdiction
for
the appointment of a conservator or receiver or liquidator in any insolvency,
readjustment of debt, including bankruptcy, marshaling of assets and liabilities
or similar proceedings, or for the winding-up or liquidation of its affairs,
shall have been entered against the Company and such degree or order shall
have
remained in force undischarged or unstayed for a period of 30 days;
or
(v) the
Company shall consent to the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshaling of assets
and
liabilities or similar proceedings of or relating to the Company or of or
relating to all or substantially all of its property; or
(vi) the
Company shall admit in writing its inability to pay its debts generally as
they
become due, file a petition to take advantage of any applicable insolvency,
bankruptcy or reorganization statute, make an assignment for the benefit
of its
creditors, voluntarily suspend payment of its obligations or cease its normal
business operations for three Business Days; or
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(vii) the
Company ceases to meet the qualifications of a FNMA/▇▇▇▇▇▇▇ Mac servicer;
or
(viii) the
Company attempts to assign its right to servicing compensation hereunder
or to
assign this Agreement or the servicing responsibilities hereunder or to delegate
its duties hereunder or any portion thereof in violation of Section 8.4 or
Section 11.4; or
(ix) the
taking of any action by the Company, any Company Employee, any Affiliate
or any
director or employee thereof that constitutes fraud or criminal activity
in the
performance of its obligations under this Agreement or the indictment of
any of
the foregoing Persons for criminal activity related to the mortgage origination
or servicing activities of the Company, in each case, where such indictment
materially and adversely affects the ability of the Company to perform its
obligations under this Agreement (subject to the condition that such indictment
is not dismissed within 90 days).
In
each
and every such case, so long as an Event of Default shall not have been
remedied, in addition to whatever rights the Purchaser may have at law or
equity
to damages, including injunctive relief and specific performance, the Purchaser,
by notice in writing to the Company, may terminate with cause all the rights
and
obligations of the Company under this Agreement and in and to the Mortgage
Loans
and the proceeds thereof. If the Company obtains knowledge of an Event of
Default, the Company shall promptly notify the Purchaser.
Upon
receipt by the Company of such written notice, all authority and power of
the
Company under this Agreement, whether with respect to the Mortgage Loans
or
otherwise, shall pass to and be vested in the successor appointed pursuant
to
Section 12.1. Upon written request from any Purchaser, the Company shall
prepare, execute and deliver to the successor entity designated by the Purchaser
any and all documents and other instruments, place in such successor’s
possession all Mortgage Files, and do or cause to be done all other acts
or
things necessary or appropriate to effect the purposes of such notice of
termination, including but not limited to the transfer and endorsement or
assignment of the Mortgage Loans and related documents, at the Company’s sole
expense. The Company shall cooperate with the Purchaser and such successor
in
effecting the termination of the Company’s responsibilities and rights
hereunder, including without limitation, the transfer to such successor for
administration by it of all cash amounts which shall at the time be credited
by
the Company to the Custodial Account or Escrow Account or thereafter received
with respect to the Mortgage Loans.
If
any of
the Mortgage Loans are MERS Mortgage Loans, in connection with the termination
or resignation of the Company hereunder, either (i) the successor servicer
shall
represent and warrant that it is a member of MERS in good standing and shall
agree to comply in all material respects with the rules and procedures of
MERS
in connection with the servicing of the MERS Mortgage Loans, or (ii) the
predecessor servicer shall cooperate with the successor servicer either (x)
in
causing MERS to execute and deliver an assignment of Mortgage in recordable
form
to transfer the Mortgage from MERS to the Purchaser and to execute and deliver
such other notices, documents and other instruments as may be necessary to
effect a transfer of such Mortgage Loan or servicing of such Mortgage Loan
on
the MERS system to the successor servicer or (y) in causing MERS to designate
on
the MERS system the successor servicer as the servicer of such Mortgage
Loan.
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Section
10.2. Waiver
of Defaults.
By
a
written notice, the Purchaser may waive any default by the Company in the
performance of its obligations hereunder and its consequences. Upon any waiver
of a past default, such default shall cease to exist, and any Event of Default
arising therefrom shall be deemed to have been remedied for every purpose
of
this Agreement. No such waiver shall extend to any subsequent or other default
or impair any right consequent thereon except to the extent expressly so
waived.
Section
10.3 Survival
of Certain Obligations and Liabilities of the Company.
The
representations, warranties, covenants, indemnities and agreements of the
parties provided in this Agreement and the parties’ obligations hereunder shall
survive the execution and delivery and the termination or expiration of this
Agreement. Notwithstanding any termination of the rights and obligations
of the
Company pursuant to the terms of this Agreement, the Company shall remain
liable
for any of its actions prior to the effectiveness of any such
termination.
ARTICLE
XI
TERMINATION
Section
11.1. Termination.
This
Agreement shall terminate upon any of: (i) the later of the final payment
or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or the disposition of any REO Property with respect to the last Mortgage
Loan and the remittance of all funds due hereunder, (ii) mutual consent of
the
Company and the Purchaser in writing or (iii) termination pursuant to Section
10.1, 11.2 or 11.3.
Section
11.2. Termination
Without Cause.
The
Purchaser may terminate, at its sole option, any rights the Company may have
hereunder, without cause, as provided in this Section 11.2. Any such notice
of
termination shall be in writing and delivered to the Company and any Rating
Agency at least 30 days prior to the date of such termination by registered
mail
as provided in Section 12.5.
The
Company shall be entitled to receive, as such liquidated damages, upon its
termination as servicer hereunder without cause pursuant to this Section
11.2 an
amount equal to 1.5% of the aggregate outstanding principal amount of the
Mortgage Loans as of the termination date paid by the Purchaser to the Company
with respect to all of the Mortgage Loans.
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Section
11.3. Termination
With Cause.
Notwithstanding
any other provision hereof to the contrary, the Purchaser, at its option,
may
terminate this Agreement, and any rights the Company may have hereunder,
with
material cause upon ten (10) Business Days’ prior written notice. For all
purposes of determining “material cause” with respect to termination of this
Agreement or the rights of the Company hereunder, such term shall mean, without
limitation, termination upon the occurrence of any Event of Default hereunder
which is not cured within any applicable cure period. In the event of a
termination of the Company for cause under this Section 11.3, no liquidated
damages shall be payable to the Company pursuant to Section 11.2.
Section
11.4. Servicing
of Distressed Mortgage Loans.
(a) Subject
to the requirements set forth in this Section 11.4, the Servicer may transfer
and assign its rights under this Agreement with the prior consent of the
Master
Servicer, with respect to the servicing of those Mortgage Loans that are
determined to be Distressed Mortgage Loans to the Special Servicer. Such
transfer and assignment to the Special Servicer by the Servicer shall be
subject
to the consent of the Master Servicer, the receipt of confirmation from each
Rating Agency that the transfer of servicing to the Special Servicer shall
not
result in a reduction of any rating previously given by such Rating Agency
to
any Certificate and to the written assumption by the Special Servicer of
the
duties and obligations of the Servicer hereunder with respect to the servicing
of such Distressed Mortgage Loans. Any monthly fee paid to the Special Servicer
in connection with any Mortgage Loan serviced by such Special Servicer hereunder
shall not exceed the Servicing Fee hereunder. All unreimbursed Servicing
Fees,
Servicing Advances and Monthly Advances owing to the Servicer relating to
such
Distressed Mortgage Loans shall be reimbursed and paid to the Servicer by
the
successor Special Servicer upon such transfer to the Special
Servicer.
(b) All
reasonable costs and expenses incurred in connection with a transfer of
servicing to the Special Servicer including, without limitation, the costs
and
expenses of the Master Servicer, the Trustee or any other Person in connection
with such transfer including the transfer of the Servicing Files and the
other
necessary data to the Special Servicer, shall be paid by the Seller from
its own
funds without reimbursement. The Seller shall be responsible for the delivery
of
all required transfer notices and will send a copy of the transfer notice
to the
Master Servicer and the Trustee.
ARTICLE
XII
MISCELLANEOUS
PROVISIONS
Section
12.1. Successor
to Company.
Prior
to
termination of the Company’s responsibilities and duties under this Agreement
pursuant to Sections 8.4, 10.1 or 11.1, the Purchaser shall, (i) succeed
to and
assume all of the Company’s responsibilities, rights, duties and obligations
under this Agreement, or (ii) appoint a successor having the characteristics
set
forth in Section 8.2 and which shall succeed to all rights and assume all
of the
responsibilities, duties and liabilities of the Company under this Agreement
prior to the termination of Company’s responsibilities, duties and liabilities
under this Agreement. In connection with such appointment and assumption,
the
Purchaser may make such arrangements for the compensation of such successor
out
of payments on Mortgage Loans as it and such successor shall agree. In the
event
that the Company’s duties, responsibilities and liabilities under this Agreement
should be terminated pursuant to the aforementioned sections, the Company
shall
discharge such duties and responsibilities during the period from the date
it
acquires knowledge of such termination until the effective date thereof with
the
same degree of diligence and prudence which it is obligated to exercise under
this Agreement, and shall take no action whatsoever that might impair or
prejudice the rights or financial condition of its successor. The resignation
or
removal of the Company pursuant to the aforementioned sections shall not
become
effective until a successor shall be appointed pursuant to this Section 12.1
and
shall in no event relieve the Company of the representations and warranties
made
pursuant to Sections 3.1 and 3.2 and the remedies available to the Purchaser
under Sections 2.3, 3.3 and 6.2, it being understood and agreed that the
provisions of such Sections 2.3, 3.1, 3.2, 3.3 and 6.1 shall be applicable
to
the Company notwithstanding any such sale, assignment, resignation or
termination of the Company, or the termination of this Agreement.
-61-
Any
successor appointed as provided herein shall execute, acknowledge and deliver
to
the Company and to the Purchaser an instrument accepting such appointment,
wherein the successor shall make the representations and warranties set forth
in
Section 3.1, except for the portion of subsection (h) relating to sale of
the
mortgage loans and all of subsections (j) and (l) thereof, whereupon such
successor shall become fully vested with all the rights, powers, duties,
responsibilities, obligations and liabilities of the Company, with like effect
as if originally named as a party to this Agreement. Any termination or
resignation of the Company or termination of this Agreement pursuant to Section
8.4, 10.1, 11.1, 11.2 or 11.3 shall not affect any claims that any Purchaser
may
have against the Company arising out of the Company’s actions or failure to act
prior to any such termination or resignation.
The
Company shall deliver promptly to the successor servicer the funds in the
Custodial Account and Escrow Account and all Mortgage Files and related
documents and statements held by it hereunder and the Company shall account
for
all funds and shall execute and deliver such instruments and do such other
things as may reasonably be required to more fully and definitively vest
in the
successor all such rights, powers, duties, responsibilities, obligations
and
liabilities of the Company.
Unless
the Company is terminated pursuant to Section 11.2, the Purchaser shall be
entitled to be reimbursed from the Company for all costs associated with
the
transfer of servicing, including, without limitation, any costs or expenses
associated with the complete transfer of all servicing data and the completion,
correction or manipulation of such servicing data as may be required by the
Purchaser to correct any errors or insufficiencies in the servicing data
or
otherwise to enable the Purchaser to service the Mortgage Loans properly
and
effectively.
Upon
a
successor’s acceptance of appointment as such, the Company shall notify by mail
the Purchaser of such appointment in accordance with the procedures set forth
in
Section 12.5.
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Section
12.2. Amendment.
This
Agreement may be amended from time to time by written agreement signed by
the
Company and the Purchaser.
Section
12.3. Governing
Law.
This
Agreement shall be construed in accordance with the laws of the State of
New
York and the obligations, rights and remedies of the parties hereunder shall
be
determined in accordance with such laws.
Each
of
the Company and the Purchaser hereby knowingly, voluntarily and intentionally
waives any and all rights it may have to a trial by jury in respect or any
litigation based on, or arising out of, under, or in connection with, this
Agreement, or any other documents and instruments executed in connection
herewith, or any course of conduct, course of dealing, statements (whether
oral
or written), or actions of the Company or the Purchaser. This provision is
a
material inducement for the Purchaser to enter into this Agreement.
Section
12.4. Duration
of Agreement.
This
Agreement shall continue in existence and effect until terminated as herein
provided. This Agreement shall continue notwithstanding transfers of the
Mortgage Loans by the Purchaser.
Section
12.5. Notices.
All
demands, notices and communications hereunder shall be in writing and shall
be
deemed to have been duly given if personally delivered at or mailed by
registered mail, postage prepaid, addressed as follows:
|
(i)
|
if
to the Company:
|
SunTrust
Mortgage, Inc.
▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attention:
▇▇▇ ▇▇▇▇▇▇▇
Telephone
(▇▇▇) ▇▇▇-▇▇▇▇
Facsimile:
(▇▇▇) ▇▇▇-▇▇▇▇
with
a
copy to:
SunTrust
Mortgage, Inc.
▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attn:
▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
or
such
other address as may hereafter be furnished to the Purchaser in writing by
the
Company;
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|
(ii)
|
if
to Purchaser:
|
GS
Mortgage Securities Corp.
▇▇
▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Tel:
(▇▇▇) ▇▇▇-▇▇▇▇
Fax:
(▇▇▇) ▇▇▇-▇▇▇▇
or
such
other address as may hereafter be furnished to the Company in writing by
the
Purchaser.
Section
12.6. Severability
of Provisions.
If
any
one or more of the covenants, agreements, provisions or terms of this Agreement
shall be held invalid for any reason whatsoever, then such covenants,
agreements, provisions or terms shall be deemed severable from the remaining
covenants, agreements, provisions or terms of this Agreement and shall in
no way
affect the validity or enforceability of the other provisions of this
Agreement.
Section
12.7. Relationship
of Parties.
Nothing
herein contained shall be deemed or construed to create a partnership or
joint
venture between the parties hereto and the services of the Company shall
be
rendered as an independent contractor and not as agent for the
Purchaser.
Section
12.8. Execution;
Successors and Assigns.
This
Agreement may be executed in one or more counterparts and by the different
parties hereto on separate counterparts, each of which, when so executed,
shall
be deemed to be an original; such counterparts, together, shall constitute
one
and the same agreement. Subject to Section 8.4, this Agreement shall inure
to
the benefit of and be binding upon, and shall be enforceable by, the Company
and
the Purchaser and their respective successors and assigns, including without
limitation, the Trustee.
Section
12.9. Recordation
of Assignments of Mortgage.
To
the
extent permitted by Applicable Law, each of the Assignments of Mortgage is
subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which any
or
all of the Mortgaged Properties are situated, and in any other appropriate
public recording office or elsewhere, which recordation shall have been effected
at the Company’s expense in the event recordation is either necessary under
Applicable Law or requested by the Purchaser at its sole option.
Section
12.10. Assignment
by Purchaser.
The
Purchaser shall have the right, without the consent of the Company but subject
to the limit set forth in Section 2.2 hereof, to assign, in whole or in part,
its interest under this Agreement with respect to some or all of the Mortgage
Loans, and designate any person to exercise any rights of the Purchaser
hereunder, by executing an Assignment and Assumption Agreement and the assignee
or designee shall accede to the rights and obligations hereunder of the
Purchaser with respect to such Mortgage Loans. All references to the Purchaser
in this Agreement shall be deemed to include its assignee or
designee.
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Section
12.11. Solicitation
of Mortgagor.
The
Purchaser, its affiliates, successors or assigns shall not, without the prior
written consent of the Company, take any action to solicit or make direct
contact with the Mortgagor under any Mortgage Loan except to the extent required
by the Company’s breach of this Agreement or as required under Applicable Law or
regulatory authority. Notwithstanding any provision of this Agreement to
the
contrary, in the event the Purchaser, its affiliates, successors or assigns
fails to obtain such written consent, the Company shall be entitled, in its
sole
discretion, to terminate its obligations and duties under this Agreement.
Upon
termination without cause of the servicing rights and obligations under this
Agreement and the transfer of such rights and obligations to the Purchaser
or
Purchaser’s designee, the Company shall be entitled to receive damages as
provided in Section 11.2.
The
Company agrees that, after the Closing Date, it will not take any action
to
solicit the refinancing of any Mortgage Loan. It is understood and agreed
that
promotions undertaken by the Company or any affiliate of the Company which
are
directed to the general public at large, including, without limitation, mass
mailings based upon commercially acquired mailing lists, newspaper, radio,
television advertisements or from servicing the refinancing needs of a Mortgagor
who, without solicitation, contacts Company in connection with the refinance
of
such Mortgage or Mortgage Loan, shall not constitute solicitation under this
Section. Notwithstanding anything to the contrary, this Section shall not
prohibit the Company from soliciting any Mortgagor to provide other services
including but not limited to credit cards, insurance investments and banking
related services.
Section
12.12. Confidential
Information.
The
Company shall keep confidential and shall not divulge to any party, without
the
Purchaser’s prior written consent, the price paid by the Purchaser for the
Mortgage Loans, except to the extent that it is reasonable and necessary
for the
Company to do so in working with legal counsel, auditors, taxing authorities
or
other governmental agencies.
The
Purchaser and the Company agree they (i) shall comply with all Applicable
Laws
regarding the privacy or security of Consumer Information, (ii) shall not
collect, create, use, store, access, disclose or otherwise handle Consumer
Information in any manner inconsistent with any applicable laws or regulations
regarding the privacy or security of Consumer Information, (iii) shall not
disclose Consumer Information to any affiliated or non-affiliated third party
except to enforce or preserve its rights, as otherwise permitted or required
by
applicable law (or by regulatory authorities having jurisdiction in the
premises) or, in the case of the Company, at the specific written direction
of
the Purchaser, (iv) shall maintain appropriate administrative, technical
and
physical safeguards to protect the security, confidentiality and integrity
of
Consumer Information, including maintaining security measures designed to
meet
the Interagency Guidelines Establishing Standards for Safeguarding Consumer
Information published in final form on February 1, 2001, 66 Fed. Reg. 8616,
and
the rules promulgated thereunder and (v) shall promptly notify the other
party
in writing upon becoming aware of any actual breach and of any suspected
breach
of this section. The Company shall promptly provide the Purchaser’s regulators
information regarding such security measures upon the reasonable request
of the
Purchaser, which information shall include, but not be limited to, any SAS
70 or
similar independent audit reports, summaries of test results or equivalent
measures taken by the Company with respect to its security measures, as agreed
upon by the parties. Each party shall indemnify and defend the other party
against, and shall hold the other party harmless from, any cost, expense,
loss,
claim or other liability that such other party may suffer as a result of
or in
connection with its failure to comply with or perform the obligations set
forth
in this section. The restrictions set forth herein shall survive the termination
of this Agreement. As used herein, “Consumer
Information”
shall
mean information including but not limited to all personal information about
the
Mortgagors that is supplied to the Company on behalf of the
Mortgagors.
-65-
ARTICLE
XIII
COMPLIANCE
WITH REGULATION AB
Section
13.1. Intent
of the Parties; Reasonableness.
The
Purchaser and the Company acknowledge and agree that the purpose of Article
XIII
of this Agreement is to facilitate compliance by the Purchaser and any Depositor
with the provisions of Regulation AB and related rules and regulations of
the
Commission. Although Regulation AB is applicable by its terms only to offerings
of asset-backed securities that are registered under the Securities Act,
the
Company acknowledges that investors in privately offered securities may require
that the Purchaser or the Depositor provide comparable disclosure in
unregistered offerings. References in this Agreement to compliance with
Regulation AB include provision of comparable disclosure in private
offerings.
Neither
the Purchaser nor the Depositor shall exercise its right to request delivery
of
information or other performance under these provisions other than in good
faith, or for purposes other than compliance with the Securities Act, the
Exchange Act and the rules and regulations of the Commission thereunder (or
the
provision in a private offering of disclosure comparable to that required
under
the Securities Act). The Company acknowledges that interpretations of the
requirements of Regulation AB may change over time, whether due to interpretive
guidance provided by the Commission or its staff, consensus among participants
in the asset-backed securities markets, advice of counsel, or otherwise,
and
agrees to comply with requests made by the Purchaser or the Depositor in
good
faith for delivery of information under these provisions on the basis of
evolving interpretations of Regulation AB, subject to the limitations provided
in Item 1105(f) of Regulation AB. In connection with the Securitization
Transaction, the Company shall cooperate fully with the Purchaser to deliver
to
the Purchaser (including any of its assignees or designees) and the Depositor,
any and all statements, reports, certifications, records and any other
information necessary in the good faith determination of the Purchaser or
the
Depositor to permit the Purchaser or the Depositor to comply with the provisions
of Regulation AB, together with such disclosures relating to the Company,
any
Subservicer, any Third-Party Originator and the Mortgage Loans, or the servicing
of the Mortgage Loans, reasonably believed by the Purchaser or the Depositor
to
be necessary in order to effect such compliance, subject to the limitations
provided in Item 1105(f) of Regulation AB.
-66-
The
Purchaser (including any of its assignees or designees) shall cooperate with
the
Company by providing timely notice of requests for information under these
provisions and by reasonably limiting such requests to information required,
in
the Purchaser’s reasonable judgment, to comply with Regulation AB.
Section
13.2. Additional
Representations and Warranties of the Company.
(a) The
Company shall be deemed to represent to the Purchaser and the Depositor,
as of
the date on which information is first provided to the Purchaser or the
Depositor under Section 13.3 that, except as disclosed in writing to the
Purchaser or the Depositor prior to such date: (i) the Company is not aware
and
has not received notice that any default, early amortization or other
performance triggering event with respect to the Company has occurred as
to any
other securitization due to any act or failure to act of the Company; (ii)
the
Company has not been terminated as servicer in a residential mortgage loan
securitization, either due to a servicing default or to application of a
servicing performance test or trigger; (iii) no material noncompliance with
the
applicable servicing criteria with respect to other securitizations of
residential mortgage loans involving the Company as servicer has been disclosed
or reported by the Company; (iv) no material changes to the Company’s policies
or procedures with respect to the servicing function it will perform under
this
Agreement for mortgage loans of a type similar to the Mortgage Loans have
occurred during the three-year period immediately preceding the Securitization
Transaction; (v) there are no aspects of the Company’s financial condition that
could have a material adverse effect on the performance by the Company of
its
servicing obligations under this Agreement; (vi) there are no material legal
or
governmental proceedings pending (or known to be contemplated) against the
Company, any Subservicer or any Third-Party Originator; and (vii) there are
no
affiliations, relationships or transactions relating to the Company, any
Subservicer or any Third-Party Originator with respect to the Securitization
Transaction and any party thereto identified by the related Depositor of
a type
described in Item 1119 of Regulation AB.
(b) If
so
requested by the Purchaser or the Depositor on any date following the date
on
which information is first provided to the Purchaser or the Depositor under
Section 13.3, the Company shall, within five Business Days following such
request, confirm in writing the accuracy of the representations and warranties
set forth in paragraph (a) of this Section or, if any such representation
and
warranty is not accurate as of the date of such request, provide reasonably
adequate disclosure of the pertinent facts, in writing, to the requesting
party.
Section
13.3. Information
to Be Provided by the Company.
In
connection with the Securitization Transaction the Company shall provide
to the
Purchaser (or, as applicable, cause each Third-Party Originator and each
Subservicer to provide), in writing and in form and substance reasonably
satisfactory to the Purchaser and the Depositor, the information and materials
specified in paragraphs (a), (b), (c) and (f) of this Section, and (ii) as
promptly as practicable following notice to or discovery by the Company,
provide
to the Purchaser and the Depositor (in writing and in form and substance
reasonably satisfactory to the Purchaser and the Depositor) the information
specified in paragraph (d) of this Section.
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(a) If
so
requested by the Purchaser or the Depositor, the Company shall provide such
information regarding (i) the Company, as originator of the Mortgage Loans
(including as an acquirer of Mortgage Loans from a Qualified Correspondent),
or
(ii) each Third-Party Originator, and (iii) as applicable, each Subservicer,
as
is requested in good faith for the purpose of compliance with Items 1103(a)(1),
1105, 1110, 1117 and 1119 of Regulation AB. Such information may include,
if
applicable:
(A) the
originator’s form of organization;
(B) a
description of the originator’s origination program and how long the originator
has been engaged in originating residential mortgage loans, which description
shall include a discussion of the originator’s experience in originating
mortgage loans of a similar type as the Mortgage Loans; information regarding
the size and composition of the originator’s origination portfolio; and
information that may be material, in the good faith judgment of the Purchaser
or
the Depositor, to an analysis of the performance of the Mortgage Loans,
including the originators’ credit-granting or underwriting criteria for mortgage
loans of similar type(s) as the Mortgage Loans and such other information
as the
Purchaser or the Depositor may reasonably request for the purpose of compliance
with Item 1110(b)(2) of Regulation AB;
(C) a
description of any material legal or governmental proceedings pending (or
known
to be contemplated) against the Company, each Third-Party Originator and
each
Subservicer; and
(D) a
description of any affiliation or relationship between the Company, each
Third-Party Originator, each Subservicer and any of the following parties
to the
Securitization Transaction, as such parties are identified to the Company
by the
Purchaser or the Depositor in writing in advance of the Securitization
Transaction:
(1) the
sponsor;
(2) the
issuing entity;
(3) any
servicer;
(4) any
trustee;
(5) any
originator;
(6) any
significant obligor;
(7) any
enhancement or support provider; and
(8) any
other
material transaction party.
(b) If
so
requested by the Purchaser or the Depositor, the Company shall provide (or,
as
applicable, cause each Third-Party Originator to provide) Static Pool
Information with respect to the mortgage loans (of a similar type as the
Mortgage Loans, as reasonably identified by the Purchaser as provided below)
originated by (i) the Company, if the Company is an originator of Mortgage
Loans
(including as an acquirer of Mortgage Loans from a Qualified Correspondent),
and/or (ii) each Third-Party Originator; provided that the information to
be
provided by the Company shall be in such format as the Company maintains
such
data or such other form of report as agreed to by the Company and the Purchaser
in response to market standards for static pool information, and the Company
shall not be obligated to customize such format for use by the Purchaser
or the
Depositor. Such Static Pool Information shall be prepared by the Company
(or
Third-Party Originator) on the basis of its reasonable, good faith
interpretation of the requirements of Item 1105(a)(1)-(3) of Regulation AB.
To
the extent that there is reasonably available to the Company (or Third-Party
Originator) Static Pool Information with respect to more than one mortgage
loan
type, the Purchaser or the Depositor shall be entitled to specify whether
some
or all of such information shall be provided pursuant to this paragraph.
The
content of such Static Pool Information may be in the form customarily provided
by the Company, and need not be customized for the Purchaser or the Depositor.
Such Static Pool Information for each vintage origination year or prior
securitized pool, as applicable, shall be presented in increments no less
frequently than quarterly over the life of the mortgage loans included in
the
vintage origination year or prior securitized pool. The most recent periodic
increment must be as of a date no later than 135 days prior to the date of
the
prospectus or other offering document in which the Static Pool Information
is to
be included or incorporated by reference. The Static Pool Information shall
be
provided in an electronic format that provides a permanent record of the
information provided, such as a portable document format (pdf) file, or other
such electronic format reasonably required by the Purchaser or the Depositor,
as
applicable.
-68-
Promptly
following notice or discovery of a material error in Static Pool Information
provided pursuant to the immediately preceding paragraph (including an omission
to include therein information required to be provided pursuant to such
paragraph), the Company shall provide corrected Static Pool Information to
the
Purchaser or the Depositor, as applicable, in the same format in which Static
Pool Information was previously provided to such party by the
Company.
If
so
requested by the Purchaser or the Depositor, the Company shall provide (or,
as
applicable, cause each Third-Party Originator to provide), at the expense
of the
requesting party (to the extent of any additional incremental expense associated
with delivery pursuant to this Agreement), such agreed-upon procedures letters
of certified public accountants reasonably acceptable to the Purchaser or
Depositor, as applicable, pertaining to Static Pool Information relating
to
prior securitized pools for securitizations closed on or after January 1,
2006
or, in the case of Static Pool Information with respect to the Company’s or
Third-Party Originator’s originations or purchases, to calendar months
commencing January 1, 2006, as the Purchaser or the Depositor shall reasonably
request. Such letters shall be addressed to and be for the benefit of such
parties as the Purchaser or the Depositor shall designate, which may include,
by
way of example, the Sponsor, the Depositor and any broker dealer acting as
underwriter, placement agent or initial purchaser with respect to the
Securitization Transaction. Any such statement or letter may take the form
of a
standard, generally applicable document accompanied by a reliance letter
authorizing reliance by the addressees designated by the Purchaser or the
Depositor.
(c) If
so
requested by the Purchaser or the Depositor, the Company shall provide such
information regarding the Company, as servicer of the Mortgage Loans, and
each
Subservicer (each of the Company and each Subservicer, for purposes of this
paragraph, a “Servicer”),
as is
requested in good faith for the purpose of compliance with Item 1108 of
Regulation AB. Such information may include, if applicable:
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(A) the
Servicer’s form of organization;
(B) a
description of how long the Servicer has been servicing residential mortgage
loans; a general discussion of the Servicer’s experience in servicing assets of
any type as well as a more detailed discussion of the Servicer’s experience in,
and procedures for, the servicing function it will perform under this Agreement;
information regarding the size, composition and growth of the Servicer’s
portfolio of residential mortgage loans of a type similar to the Mortgage
Loans
and information on factors related to the Servicer that may be material,
in the
good faith judgment of the Purchaser or the Depositor, to any analysis of
the
servicing of the Mortgage Loans or the related asset-backed securities, as
applicable, including, without limitation:
(1) whether
any prior securitizations of mortgage loans of a type similar to the Mortgage
Loans involving the Servicer have defaulted or experienced an early amortization
or other performance triggering event because of servicing during the three-year
period immediately preceding the Securitization Transaction;
(2) the
extent of outsourcing the Servicer utilizes;
(3) whether
there has been previous disclosure of material noncompliance with the applicable
servicing criteria with respect to other securitizations of residential mortgage
loans involving the Servicer as a servicer during the three-year period
immediately preceding the Securitization Transaction;
(4) whether
the Servicer has been terminated as servicer in a residential mortgage loan
securitization, either due to a servicing default or to application of a
servicing performance test or trigger; and
(5) such
other information as the Purchaser or the Depositor may reasonably request
for
the purpose of compliance with Item 1108(b)(2) of Regulation AB;
(C) a
description of any material changes during the three-year period immediately
preceding the Securitization Transaction to the Servicer’s policies or
procedures with respect to the servicing function it will perform under this
Agreement for mortgage loans of a type similar to the Mortgage
Loans;
(D) information
regarding the Servicer’s financial condition, to the extent that there is a
material risk that an adverse financial event or circumstance involving the
Servicer could have a material adverse effect on the performance by the Company
of its servicing obligations under this Agreement;
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(E) information
regarding advances made by the Servicer on the Mortgage Loans and the Servicer’s
overall servicing portfolio of residential mortgage loans for the three-year
period immediately preceding the Securitization Transaction, which may be
limited to a statement by an authorized officer of the Servicer to the effect
that the Servicer has made all advances required to be made on residential
mortgage loans serviced by it during such period, or, if such statement would
not be accurate, information regarding the percentage and type of advances
not
made as required, and the reasons for such failure to advance;
(F) a
description of the Servicer’s processes and procedures designed to address any
special or unique factors involved in servicing loans of a similar type as
the
Mortgage Loans;
(G) a
description of the Servicer’s processes for handling delinquencies, losses,
bankruptcies and recoveries, such as through liquidation of mortgaged
properties, sale of defaulted mortgage loans or workouts; and
(H) information
as to how the Servicer defines or determines delinquencies and charge-offs,
including the effect of any grace period, re-aging, restructuring, partial
payments considered current or other practices with respect to delinquency
and
loss experience.
(d) If
so
requested by the Purchaser or the Depositor for the purpose of satisfying
its
reporting obligation under the Exchange Act with respect to any class of
asset-backed securities, the Company shall (or shall cause each Subservicer
and
Third-Party Originator to) (i) notify the Purchaser and the Depositor in
writing
of (A) any material litigation or governmental proceedings pending against
the
Company, any Subservicer or any Third-Party Originator and (B) any affiliations
or relationships that develop following the closing date of the Securitization
Transaction between the Company, any Subservicer or any Third-Party Originator
and any of the parties specified in clause (D) of paragraph (a) of this Section
(and any other parties identified in writing by the requesting party) with
respect to the Securitization Transaction, and (ii) provide to the Purchaser
and
the Depositor a description of such proceedings, affiliations or
relationships.
(e) As
a
condition to the succession to the Company or any Subservicer as servicer
or
subservicer under this Agreement by any Person (i) into which the Company
or
such Subservicer may be merged or consolidated, or (ii) which may be appointed
as a successor to the Company or any Subservicer, the Company shall provide
to
the Purchaser and the Depositor, at least 15 calendar days prior to the
effective date of such succession or appointment, (x) written notice to the
Purchaser and the Depositor of such succession or appointment and (y) in
writing
and in form and substance reasonably satisfactory to the Purchaser and the
Depositor, all information reasonably requested by the Purchaser or the
Depositor in order to comply with its reporting obligation under Item 6.02
of
Form 8-K with respect to any class of asset-backed securities.
(f) In
addition to such information as the Company, as servicer, is obligated to
provide pursuant to other provisions of this Agreement, if so requested by
the
Purchaser or the Depositor, the Company shall provide such information regarding
the performance or servicing of the Mortgage Loans as is reasonably required
by
the Purchaser or the Depositor to facilitate preparation of distribution
reports
in accordance with Item 1121 of Regulation AB and to permit the Purchaser
or the
Depositor to comply with the provisions of Regulation AB relating to Static
Pool
Information regarding the performance of the Mortgage Loans on the basis
of the
Purchaser’s or the Depositor’s reasonable, good faith interpretation of the
requirements of Item 1105(a)(1)-(3) of Regulation AB (including without
limitation as to the format and content of such Static Pool Information).
Such
information shall be provided concurrently with the monthly reports otherwise
required to be delivered by the Company under this Agreement, commencing
with
the first such report due not less than ten (10) Business Days following
such
request.
-71-
Section
13.4. Servicer
Compliance Statement.
On
or
before March 15 of each calendar year, commencing in 2008, the Company shall
deliver to the Purchaser and the Depositor a statement of compliance addressed
to the Purchaser and the Depositor and signed by an authorized officer of
the
Company, to the effect that (i) a review of the Company’s activities during the
immediately preceding calendar year (or applicable portion thereof) and of
its
performance under this Agreement during such period has been made under such
officer’s supervision, and (ii) to the best of such officers’ knowledge, based
on such review, the Company has fulfilled all of its obligations under this
Agreement in all material respects throughout such calendar year (or applicable
portion thereof) or, if there has been a failure to fulfill any such obligation
in any material respect, specifically identifying each such failure known
to
such officer and the nature and the status thereof.
Section
13.5. Report
on Assessment of Compliance and Attestation.
(a) On
or
before March 15 of each calendar year, commencing in 2008, the Company
shall:
(i) deliver
to the Purchaser and the Depositor a report (in form and substance reasonably
satisfactory to the Purchaser and the Depositor) regarding the Company’s
assessment of compliance with the Servicing Criteria during the immediately
preceding calendar year, as required under Rules 13a-18 and 15d-18 of the
Exchange Act and Item 1122 of Regulation AB. Such report shall be addressed
to
the Purchaser and the Depositor and signed by an authorized officer of the
Company, and shall address each of the Servicing Criteria specified on a
certification substantially in the form of Exhibit K hereto delivered to
the
Purchaser concurrently with the execution of this Agreement;
(ii) deliver
to the Purchaser and the Depositor a report of a registered public accounting
firm reasonably acceptable to the Purchaser and the Depositor that attests
to,
and reports on, the assessment of compliance made by the Company and delivered
pursuant to the preceding paragraph. Such attestation shall be in accordance
with Rules 1-02(a)(3) and 2-02(g) of Regulation S-X under the Securities
Act and
the Exchange Act;
-72-
(iii) cause
each Subservicer, and each Subcontractor determined by the Company pursuant
to
Section 13.6(b) to be “participating in the servicing function” within the
meaning of Item 1122 of Regulation AB, to deliver to the Purchaser and the
Depositor an assessment of compliance and accountants’ attestation as and when
provided in paragraphs (a) and (b) of this Section; and
(iv) if
requested by the Purchaser or the Depositor not later than February 1 of
the
calendar year in which such certification is to be delivered, deliver to
the
Purchaser, the Depositor and any other Person that will be responsible for
signing the certification (a “Sarbanes Certification”) required by Rules
13a-14(d) and 15d-14(d) under the Exchange Act (pursuant to Section 302 of
the
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002) on behalf of an asset-backed issuer with respect
to
the Securitization Transaction a certification in the form attached hereto
as
Exhibit H.
The
Company acknowledges that the parties identified in clause (a)(iv) above
may
rely on the certification provided by the Company pursuant to such clause
in
signing a Sarbanes Certification and filing such with the Commission. Neither
the Purchaser nor the Depositor will request delivery of a certification
under
clause (a)(iv) above, unless a Depositor is required under the Exchange Act
to
file an annual report on Form 10-K with respect to an issuing entity whose
asset
pool includes Mortgage Loans.
(b) Each
assessment of compliance provided by a Subservicer pursuant to Section
13.5(a)(i) shall address each of the Servicing Criteria specified on a
certification substantially in the form of Exhibit K hereto delivered to
the
Purchaser concurrently with the execution of this Agreement or, in the case
of a
Subservicer subsequently appointed as such, on or prior to the date of such
appointment. An assessment of compliance provided by a Subcontractor pursuant
to
Section 13.5(a)(iii) need not address any elements of the Servicing Criteria
other than those specified by the Company pursuant to Section 13.6.
Section
13.6. Use
of
Subservicers and Subcontractors.
The
Company shall not hire or otherwise utilize the services of any Subservicer
to
fulfill any of the obligations of the Company as servicer under this Agreement
unless the Company complies with the provisions of paragraph (a) of this
Section. The Company shall not hire or otherwise utilize the services of
any
Subcontractor, and shall not permit any Subservicer to hire or otherwise
utilize
the services of any Subcontractor, to fulfill any of the obligations of the
Company as servicer under this Agreement unless the Company complies with
the
provisions of paragraph (b) of this Section.
(a) It
shall
not be necessary for the Company to seek the consent of the Purchaser and
the
Depositor to the utilization of any Subservicer. The Company shall cause
any
Subservicer used by the Company (or by any Subservicer) for the benefit of
the
Purchaser and the Depositor to comply with the provisions of this Section
and
with Sections 13.2, 13.3(c) and (e), 13.4, 13.5 and 13.7 of this Agreement
to
the same extent as if such Subservicer were the Company, and to provide the
information required with respect to such Subservicer under Section 13.3(d)
of
this Agreement. The Company shall be responsible for obtaining from each
Subservicer and delivering to the Purchaser and the Depositor any servicer
compliance statement required to be delivered by such Subservicer under Section
13.4, any assessment of compliance and attestation required to be delivered
by
such Subservicer under Section 13.5 and any certification required to be
delivered to the Person that will be responsible for signing the Sarbanes
Certification under Section 13.5 as and when required to be
delivered.
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(b) It
shall
not be necessary for the Company to seek the consent of the Purchaser or
the
Depositor to the utilization of any Subcontractor. The Company shall promptly
upon request provide to the Purchaser and the Depositor (or any designee
of the
Depositor, such as a master servicer or administrator) a written description
(in
form and substance satisfactory to the Purchaser and the Depositor) of the
role
and function of each Subcontractor utilized by the Company or any Subservicer,
specifying (i) the identity of each such Subcontractor, (ii) which (if any)
of
such Subcontractors are “participating in the servicing function” within the
meaning of Item 1122 of Regulation AB, and (iii) which elements of the Servicing
Criteria will be addressed in assessments of compliance provided by each
Subcontractor identified pursuant to clause (ii) of this paragraph.
As
a
condition to the utilization of any Subcontractor determined to be
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB, the Company shall cause any such Subcontractor used by the
Company (or by any Subservicer) for the benefit of the Purchaser and the
Depositor to comply with the provisions of Sections 13.5 and 13.7 of this
Agreement to the same extent as if such Subcontractor were the Company. The
Company shall be responsible for obtaining from each Subcontractor and
delivering to the Purchaser and the Depositor any assessment of compliance
and
attestation required to be delivered by such Subcontractor under Section
13.5,
in each case as and when required to be delivered.
Section
13.7. Indemnification;
Remedies.
(a) The
Company shall indemnify the Purchaser, each affiliate of the Purchaser and
the
Trust; each Person responsible for the preparation, execution or filing of
any
report required to be filed with the Commission with respect to the
Securitization Transaction, or for execution of a certification pursuant
to Rule
13a-14(d) or Rule 15d-14(d) under the Exchange Act with respect to the
Securitization Transaction; each broker dealer acting as underwriter, placement
agent or initial purchaser, each Person who controls any of such parties
or the
Depositor (within the meaning of Section 15 of the Securities Act and Section
20
of the Exchange Act); and the respective present and former directors, officers,
employees and agents of each of the foregoing and of the Depositor, and shall
hold each of them harmless from and against any losses, damages, penalties,
fines, forfeitures, legal fees and expenses and related costs, judgments,
and
any other costs, fees and expenses that any of them may sustain arising out
of
or based upon:
(i)(A) any
untrue statement of a material fact contained or alleged to be contained
in any
information, report, certification, accountants’ letter or other material
provided under this Article 13 by or on behalf of the Company, or provided
in
written or electronic form under this Article 13 by or on behalf of any
Subservicer, Subcontractor or Third-Party Originator (collectively, the
“Company
Information”), or (B) the omission or alleged omission to state in the Company
Information a material fact required to be stated in the Company Information
or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, by
way of
clarification, that clause (B) of this paragraph shall be construed solely
by
reference to the Company Information and not to any other information
communicated in connection with a sale or purchase of securities, without
regard
to whether the Company Information or any portion thereof is presented
together
with or separately from such other information;
-74-
(ii) any
failure by the Company, any Subservicer, any Subcontractor or any Third-Party
Originator to deliver any information, report, certification, accountants’
letter or other material when and as required under this Article 13, including
(except as provided below) any failure by the Company to identify pursuant
to
Section 13.6(b) any Subcontractor “participating in the servicing function”
within the meaning of Item 1122 of Regulation AB; or
(iii) any
breach by the Company of a representation or warranty set forth in Section
13.2(a) or in a writing furnished pursuant to Section 13.2(b) and made as
of a
date prior to the closing date of the Securitization Transaction, to the
extent
that such breach is not cured by such closing date, or any breach by the
Company
of a representation or warranty in a writing furnished pursuant to Section
13.2(b) to the extent made as of a date subsequent to such closing
date.
In
the
case of any failure of performance described in clause (a)(ii) of this Section,
the Company shall promptly reimburse the Purchaser and the Depositor, as
applicable, and each Person responsible for the preparation, execution or
filing
of any report required to be filed with the Commission with respect to the
Securitization Transaction, or for execution of a certification pursuant
to Rule
13a-14(d) or Rule 15d-14(d) under the Exchange Act with respect to the
Securitization Transaction, for all costs reasonably incurred by each such
party
in order to obtain the information, report, certification, accountants’ letter
or other material not delivered as required by the Company, any Subservicer,
any
Subcontractor or any Third-Party Originator.
(b) (i) Any
failure by the Company, any Subservicer, any Subcontractor or any Third-Party
Originator to deliver any information, report, certification, accountants’
letter or other material when and as required under this Article 13, or
any
breach by the Company of a representation or warranty set forth in Section
13.2(a) or in a writing furnished pursuant to Section 13.2(b) and made
as of a
date prior to the closing date of the Securitization Transaction, to the
extent
that such breach is not cured by such closing date, or any breach by the
Company
of a representation or warranty in a writing furnished pursuant to Section
13.2(b) to the extent made as of a date subsequent to such closing date,
shall
immediately and automatically, without notice or grace period, constitute
an
Event of Default with respect to the Company under this Agreement, and
shall
entitle the Purchaser or the Depositor, as applicable, in its sole discretion
to
terminate the rights and obligations of the Company as servicer under this
Agreement without payment (other than for payment of accrued fees and
reimbursable expenses owed to the Company thereunder at the time of such
termination) (notwithstanding anything in this Agreement to the contrary)
of any
compensation to the Company; provided that to the extent that any provision
of
this Agreement expressly provides for the survival of certain rights or
obligations following termination of the Company as servicer, such provision
shall be given effect.
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(ii) Any
failure by the Company, any Subservicer or any Subcontractor to deliver any
information, report, certification or accountants’ letter when and as required
under Section 13.4 or 13.5, including any failure by the Company to identify
pursuant to Section 13.6(b) any Subcontractor “participating in the servicing
function” within the meaning of Item 1122 of Regulation AB, which continues
unremedied for ten calendar days after the date on which such information,
report, certification or accountants’ letter was required to be delivered shall
constitute an Event of Default with respect to the Company under this Agreement,
and shall entitle the Purchaser or Depositor, or applicable, in its sole
discretion to terminate the rights and obligations of the Company as servicer
under this Agreement without payment (notwithstanding anything in this Agreement
to the contrary) of any compensation to the Company; provided that to the
extent
that any provision of this Agreement expressly provides for the survival
of
certain rights or obligations following termination of the Company as servicer,
such provision shall be given effect.
Neither
the Purchaser nor the Depositor shall be entitled to terminate the rights
and
obligations of the Company pursuant to this subparagraph (b)(ii) if a failure
of
the Company to identify a Subcontractor “participating in the servicing
function” within the meaning of Item 1122 of Regulation AB was attributable
solely to the role or functions of such Subcontractor with respect to mortgage
loans other than the Mortgage Loans.
(iii) The
Company shall promptly reimburse the Purchaser (or any designee of the
Purchaser, such as a master servicer) and the Depositor, as applicable, for
all
reasonable expenses incurred by the Purchaser (or such designee) or the
Depositor, as such are incurred, in connection with the termination of the
Company as servicer and the transfer of servicing of the Mortgage Loans to
a
successor servicer. The provisions of this paragraph shall not limit whatever
rights the Purchaser or the Depositor may have under other provisions of
this
Agreement or otherwise, whether in equity or at law, such as an action for
damages, specific performance or injunctive relief.
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IN
WITNESS WHEREOF, the Company and the Purchaser have caused their names to
be
signed hereto by their respective duly authorized officers as of the day
and
year first above written.
|
GS
MORTGAGE SECURITIES CORP.,
as
purchaser
|
||
| |
|
|
| By: | /s/ ▇▇▇▇ ▇▇▇▇▇ | |
|
Name:
▇▇▇▇ ▇▇▇▇▇
Title:
Vice President
|
||
|
SUNTRUST
MORTGAGE, INC.,
a
seller and servicer
|
||
| |
|
|
| By: | /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇▇ | |
|
Name:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇▇
Title:
Vice President
|
||
EXHIBIT
A
MORTGAGE
LOAN SCHEDULE
See
attached
A-1
EXHIBIT
B
CONTENTS
OF EACH MORTGAGE FILE
With
respect to each Mortgage Loan, the Mortgage File shall include each of the
following items, which shall be available for inspection by the Purchaser
and
any prospective Purchaser, and which shall be retained by the Company in
the
Servicing File or delivered to the Custodian pursuant to Sections 2.1 and
2.3 of
the Sale and Servicing Agreement to which this Exhibit is attached (the
“Agreement”):
1. The
original Mortgage Note bearing all intervening endorsements, endorsed “Pay to
the order of ______________, without recourse” and signed in the name of the
Company by an authorized officer (in the event that the Mortgage Loan was
acquired by the Company in a merger, the signature must be in the following
form: “[Company], successor by merger to [name of predecessor]”; and in the
event that the Mortgage Loan was acquired or originated by the Company while
doing business under another name, the signature must be in the following
form:
“[Company], formerly know as [previous name]”).
2. The
original of any personal endorsement, surety and/or guaranty agreement executed
in connection with the Mortgage Note, if any.
3. Except
as
set forth below, the original Mortgage, with evidence of recording thereon
or a
certified true and correct copy of the Mortgage sent for recordation. If
in
connection with any Mortgage Loan, the Company cannot deliver or cause to
be
delivered the original Mortgage with evidence of recording thereon on or
prior
to the Closing Date because of a delay caused by the public recording office
where such Mortgage has been delivered for recordation or because such Mortgage
has been lost or because such public recording office retains the original
recorded Mortgage, the Company shall deliver or cause to be delivered to
the
Custodian, a photocopy of such Mortgage, together with (i) in the case of
a
delay caused by the public recording office, an Officer’s Certificate of the
Company stating that such Mortgage has been dispatched to the appropriate
public
recording office for recordation and that the original recorded Mortgage
or a
copy of such Mortgage certified by such public recording office to be a true
and
complete copy of the original recorded Mortgage will be promptly delivered
to
the Custodian upon receipt thereof by the Company; or (ii) in the case of
a
Mortgage where a public recording office retains the original recorded Mortgage
or in the case where a Mortgage is lost after recordation in a public recording
office, a copy of such Mortgage certified by such public recording office
or by
the title insurance company that issued the title policy to be a true and
complete copy of the original recorded Mortgage.
4. The
originals or certified true copies of all assumption, modification,
consolidation or extension agreements, with evidence of recording noted thereon
if recordation is required to maintain the lien of the mortgage or is otherwise
required, or, if recordation is not so required, an original or copy of any
such
assumption, modification, consolidation or extension agreements.
5. The
original Assignment of Mortgage for each Mortgage Loan, in form and substance
acceptable for recording, from the Company to “______________”or as otherwise
directed by the Purchaser. If the Mortgage Loan was acquired by the Company
in a
merger, the Assignment of Mortgage must be made by “[Company], successor by
merger to [name of predecessor].” If the Mortgage Loan was acquired or
originated by the Company while doing business under another name, the
Assignment of Mortgage must be by “[Company], formerly know as [previous name].”
Subject to the foregoing and where permitted under the Applicable Laws of
the
jurisdiction wherein the Mortgaged property is located, such Assignments
of
Mortgage may be made by blanket assignments for Mortgage Loans secured by
the
Mortgaged Properties located in the same county.
Exh.
B-1
6. Originals
or certified true copies of all intervening assignments of the Mortgage
necessary to show a complete chain of title from the original mortgagee to
the
Company, with evidence of recording thereon, or if any such intervening
assignment has not been returned from the applicable recording office or
has
been lost or if such public recording office retains the original recorded
assignments of mortgage, the Company shall deliver or cause to be delivered
to
the Custodian, a photocopy of such intervening assignment, together with
(i) in
the case of a delay caused by the public recording office, an Officer’s
Certificate of the Company stating that such intervening assignment of mortgage
has been dispatched to the appropriate public recording office for recordation
and that such original recorded intervening assignment of mortgage or a copy
of
such intervening assignment of mortgage certified by the appropriate public
recording office or by the title insurance company that issued the title
policy
to be a true and complete copy of the original recorded intervening assignment
of mortgage will be promptly delivered to the Custodian upon receipt thereof
by
the Company; or (ii) in the case of an intervening assignment where a public
recording office retains the original recorded intervening assignment or
in the
case where an intervening assignment is lost after recordation in a public
recording office, a copy of such intervening assignment certified by such
public
recording office to be a true and complete copy of the original recorded
intervening assignment.
7. The
original mortgage policy of title insurance or evidence of title.
8. Any
security agreement, chattel mortgage or equivalent executed in connection
with
the Mortgage.
With
respect to each Mortgage Loan, the Mortgage File shall include each of the
following items to the extent in the possession of the Company or in the
possession of the Company’s agent(s):
9. Verification
of Mortgage Insurance.
10. The
original hazard insurance policy and, if required by law, flood insurance
policy, in accordance with Section 4.10 of the Agreement.
11. Residential
loan application.
12. Mortgage
Loan closing statement.
13. Verification
of employment and income, unless originated under the Company’s Limited
Documentation program, FNMA Timesaver Plus.
Exh.
B-2
14. Verification
of acceptable evidence of source and amount of down payment.
15. Credit
report on the Mortgagor, if available.
16. Residential
appraisal report.
17. Photograph
of the Mortgaged Property.
18. Survey
of
the Mortgaged Property, if required by the title company or Applicable
Law.
19. Copy
of
each instrument necessary to complete identification of any exception set
forth
in the exception schedule in the title policy, i.e. map or plat, restrictions,
easements, sewer agreements, home association declarations, etc.
20. All
required disclosure statements.
21. If
available, termite report, structural engineer’s report, water potability and
septic certification.
22. Sales
contract, if applicable.
23. Evidence
of payment of taxes and insurance premiums, insurance claim files,
correspondence, current and historical computerized data files, and all other
processing, underwriting and closing papers and records which are customarily
contained in a mortgage loan file and which are required to document the
Mortgage Loan or to service the Mortgage Loan.
24. Amortization
schedule, if available.
25. Original
power of attorney, if applicable.
In
the
event an Officer’s Certificate of the Company is delivered to the Custodian
because of a delay caused by the public recording office in returning any
recorded document, the Company shall deliver to the Custodian, within 180
days
of the Closing Date, an Officer’s Certificate which shall (i) identify the
recorded document, (ii) state that the recorded document has not been delivered
to the Custodian due solely to a delay caused by the public recording office,
(iii) state the amount of time generally required by the applicable recording
office to record and return a document submitted for recordation, and (iv)
specify the date the applicable recorded document will be delivered to the
Custodian. The Company shall be required to deliver to the Custodian the
applicable recorded document by the date specified in (iv) above. An extension
of the date specified in (iv) above may be requested form the Purchaser,
which
consent shall not be unreasonably withheld.
Exh.
B-3
EXHIBIT
C
[Reserved]
C-1
EXHIBIT
D
[Reserved]
D-1
EXHIBIT
E
ITEMS
TO
BE INCLUDED IN MONTHLY REMITTANCE ADVICE
On
the
Closing Date, the Company shall deliver to the Purchaser an initial set-up
report (the “Initial
Set-up Report”),
dated
as of the Cut-off Date, which shall set forth certain information regarding
the
Mortgage Pool. Such information shall include, without limitation, the principal
balance of each Mortgage Loan, the interest rate, delinquency status and
any
other information requested by the Purchaser. For each month after the Closing
Date, the Company shall provide a monthly remittance advice report (the
“Monthly
Remittance Advice Reports”)
to the
Purchaser, which shall set forth for each related Mortgage Loan, the trial
balance, interest rate, delinquency, foreclosure and related default
information, and such other information as may be requested by the Purchaser.
The Initial Set-up Report and the Monthly Remittance Advice Reports will
be
delivered in an Excel format or in such other electronic format as agreed
to by
the parties. Each Initial Set-up Report and Monthly Remittance Advice Report
shall contain only such information as is readily available to the Company
and
is mutually agreed to by Company and the Purchaser.
E-1
EXHIBIT
F
[Reserved]
F-1
EXHIBIT
G
FORM
OF
SELLER’S OFFICER’S CERTIFICATE
I,
______________________, hereby certify that I am a duly elected [Vice President]
of _____________________________, a corporation organized under the laws
of the
State of _________ (the “Company”)
and
further as follows:
1. Attached
hereto as Exhibit 1 is a true, correct and complete copy of the Articles
of
Incorporation of the Company which is in full force and effect on the date
hereof.
2. Attached
hereto as Exhibit 2 is a true, correct and complete copy of the by-laws of
the
Company which are in effect on the date hereof.
3. The
execution and delivery by the Company of the Sale and Servicing Agreement,
dated
as of September 1, 2007 (the “Sale
and Servicing Agreement”)
are in
the ordinary course of business of the Company.
4. A
true
and correct copy of the resolutions of the board of directors of the Company
that approve, authorize and direct the Company to enter into the Sale and
Servicing Agreement are attached hereto as Exhibit 3.
5. Each
person who, as an officer or representative of the Company, signed (a) the
Sale
and Servicing Agreement, or (b) any other document delivered prior hereto
or on
the date hereof in connection with any transaction described in the Sale
and
Servicing Agreement was, at the respective times of such signing and delivery
a
duly elected or appointed, qualified and acting officer or representative
of the
Company, who holds the office set forth opposite his or her name on Exhibit
4,
and the signatures of such persons appearing on such documents are their
genuine
signatures.
No
proceedings for dissolution, merger, consolidation, liquidation, conservatorship
or receivership of the Company or for the sale of all or substantially all
of
its assets is pending, or to my knowledge threatened, and no such proceeding
is
contemplated by the Company.
G-1
IN
WITNESS WHEREOF, I have hereunto signed my name and affixed the seal of the
Company.
| |
|
|
| Dated: | By: | |
|
Title: Vice President |
||
I,
__________________ the Secretary of __________________________, hereby certify
that _______________________ is a duly elected and acting Vice President
of the
Company and that the signature appearing above is his genuine
signature.
IN
WITNESS WHEREOF, I have hereunto signed my name.
| |
|
|
| Dated: | By: | |
|
Title: Secretary |
||
G-2
EXHIBIT
H
FORM
OF
ANNUAL CERTIFICATION
Re: The
[ ]
agreement dated as of [ l,
200[ ]
(the “Agreement”), among [IDENTIFY PARTIES]
I,
____________________________, the _______________________ of [NAME OF COMPANY]
(the “Company”), certify to [the Purchaser], [the Depositor], and the [Master
Servicer] [Securities Administrator] [Trustee], and their officers, with
the
knowledge and intent that they will rely upon this certification,
that:
(1) I
have
reviewed the servicer compliance statement of the Company provided in accordance
with Item 1123 of Regulation AB (the “Compliance Statement”), the report on
assessment of the Company’s compliance with the servicing criteria set forth in
Item 1122(d) of Regulation AB that are identified as the responsibility of
the
Company on Exhibit 7 of the Agreement (the “Servicing Criteria”), provided in
accordance with Rules 13a-18 and 15d-18 under Securities Exchange Act of
1934,
as amended (the “Exchange Act”) and Item 1122 of Regulation AB (the “Servicing
Assessment”), the registered public accounting firm’s attestation report
provided in accordance with Rules 13a-18 and 15d-18 under the Exchange Act
and
Section 1122(b) of Regulation AB (the “Attestation Report”), and all servicing
reports, officer’s certificates and other information relating to the servicing
of the Mortgage Loans by the Company during 200[ ] that were delivered by
the
Company to the [Depositor] [Master Servicer] [Securities Administrator]
[Trustee] pursuant to the Agreement (collectively, the “Company Servicing
Information”);
(2) Based
on
my knowledge, the Company Servicing Information, taken as a whole, does not
contain any untrue statement of a material fact or omit to state a material
fact
necessary to make the statements made, in the light of the circumstances
under
which such statements were made, not misleading with respect to the period
of
time covered by the Company Servicing Information;
(3) Based
on
my knowledge, all of the Company Servicing Information required to be provided
by the Company under the Agreement has been provided to the [Depositor] [Master
Servicer] [Securities Administrator] [Trustee];
(4) I
am
responsible for reviewing the activities performed by the Company as servicer
under the Agreement, and based on my knowledge and the compliance review
conducted in preparing the Compliance Statement and except as disclosed in
the
Compliance Statement, the Servicing Assessment or the Attestation Report,
the
Company has fulfilled its obligations under the Agreement in all material
respects; and
H-1
(5) The
Compliance Statement required to be delivered by the Company pursuant to
the
Agreement, and the Servicing Assessment and Attestation Report required to
be
provided by the Company and by any Subservicer and Subcontractor pursuant
to the
Agreement, have been provided to the [Depositor] [Master Servicer]. Any material
instances of noncompliance described in such reports have been disclosed
to the
[Depositor] [Master Servicer]. Any material instance of noncompliance with
the
Servicing Criteria has been disclosed in such reports.
| Date: | ||
| |
|
|
| By: | ||
|
Name:
Title:
|
|
H-2
EXHIBIT
I
FORM
OF
WARRANTY ▇▇▇▇ OF SALE
On
this
_______ day of ________, 200__, SunTrust Mortgage, Inc. (“Seller”)
as the
Seller under that certain S and Servicing Agreement, dated as of September
1,
2007 (the “Agreement”)
does
hereby sell, transfer, assign, set over and convey to GS Mortgage Securities
Corp. as Purchaser under the Agreement, without recourse, but subject to
the
terms of the Agreement, all rights, title and interest of the Seller in and
to
the Mortgage Loans listed on the Mortgage Loan Schedule attached hereto,
together with the related Mortgage Files and all rights and obligations arising
under the documents contained therein. Pursuant to Section 2.01 of the
Agreement, the Seller has delivered to the Purchaser or its custodian the
Mortgage Loan Documents for each Mortgage Loan to be purchased as set forth
in
the Agreement. The contents of each related Servicing File required to be
maintained and retained by the Seller to service the Mortgage Loans pursuant
to
the Agreement and thus not delivered to the Purchaser are and shall be held
in
trust by the Seller for the benefit of the Purchaser as the owner thereof.
The
Seller’s possession of any portion of each such Servicing File is at the will of
the Purchaser for the sole purpose of facilitating servicing of the related
Mortgage Loan pursuant to the Agreement, and such retention and possession
by
the Seller shall be in a custodial capacity only. The ownership of each Mortgage
Note, Mortgage, and the contents of the Mortgage File and Servicing File
is
vested in the Purchaser and the ownership of all records and documents with
respect to the related Mortgage Loan prepared by or which come into the
possession of the Seller shall immediately vest in the Purchaser and shall
be
retained and maintained, in trust, by the Seller at the will of the Purchaser
in
such custodial capacity only.
The
Seller confirms to the Purchaser that the representations and warranties
set
forth in Sections 2.6, 3.1 and 3.2 of the Agreement are true and correct
as of
the date hereof, and that all statements made in the Sellers’ Officer’s
Certificate and all attachments thereto remain complete, true and correct
in all
respects as of the date hereof.
Capitalized
terms used herein and not otherwise defined shall have the meanings set forth
in
the Agreement.
|
SUNTRUST
MORTGAGE,
INC.
(Seller)
|
||
| |
|
|
| By: | ||
|
Name:
Title:
|
||
Exh.
I-1
EXHIBIT
J
[Reserved]
Exh.
J-1
EXHIBIT
K
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The
assessment of compliance to be delivered by [the Company] [Name of Subservicer]
shall address, at a minimum, the criteria identified as below as “Applicable
Servicing Criteria”:
|
Servicing
Criteria
|
Applicable
Servicing Criteria
|
|||
|
Reference
|
Criteria
|
|
||
|
|
General
Servicing Considerations
|
|
||
|
1122(d)(1)(i)
|
Policies
and procedures are instituted to monitor any performance or other
triggers
and events of default in accordance with the transaction
agreements.
|
X
|
||
|
1122(d)(1)(ii)
|
If
any material servicing activities are outsourced to third parties,
policies and procedures are instituted to monitor the third party’s
performance and compliance with such servicing activities.
|
X
|
||
|
1122(d)(1)(iii)
|
Any
requirements in the transaction agreements to maintain a back-up
servicer
for the mortgage loans are maintained.
|
|||
|
1122(d)(1)(iv)
|
A
fidelity bond and errors and omissions policy is in effect on
the party
participating in the servicing function throughout the reporting
period in
the amount of coverage required by and otherwise in accordance
with the
terms of the transaction agreements.
|
X
|
||
|
|
Cash
Collection and Administration
|
|||
|
1122(d)(2)(i)
|
Payments
on mortgage loans are deposited into the appropriate custodial
bank
accounts and related bank clearing accounts no more than two
business days
following receipt, or such other number of days specified in
the
transaction agreements.
|
X
|
||
|
1122(d)(2)(ii)
|
Disbursements
made via wire transfer on behalf of an obligor or to an investor
are made
only by authorized personnel.
|
X
|
||
|
1122(d)(2)(iii)
|
Advances
of funds or guarantees regarding collections, cash flows or distributions,
and any interest or other fees charged for such advances, are
made,
reviewed and approved as specified in the transaction
agreements.
|
X
|
||
|
1122(d)(2)(iv)
|
The
related accounts for the transaction, such as cash reserve accounts
or
accounts established as a form of overcollateralization, are
separately
maintained (e.g., with respect to commingling of cash) as set
forth in the
transaction agreements.
|
X
|
||
|
1122(d)(2)(v)
|
Each
custodial account is maintained at a federally insured depository
institution as set forth in the transaction agreements. For purposes
of
this criterion, “federally insured depository institution” with respect to
a foreign financial institution means a foreign financial institution
that
meets the requirements of Rule 13k-1(b)(1) of the Securities
Exchange
Act.
|
X
|
||
|
1122(d)(2)(vi)
|
Unissued
checks are safeguarded so as to prevent unauthorized
access.
|
X
|
||
|
1122(d)(2)(vii)
|
Reconciliations
are prepared on a monthly basis for all asset-backed securities
related
bank accounts, including custodial accounts and related bank
clearing
accounts. These reconciliations are (A) mathematically accurate;
(B)
prepared within 30 calendar days after the bank statement cutoff
date, or
such other number of days specified in the transaction agreements;
(C)
reviewed and approved by someone other than the person who prepared
the
reconciliation; and (D) contain explanations for reconciling
items. These
reconciling items are resolved within 90 calendar days of their
original
identification, or such other number of days specified in the
transaction
agreements.
|
X
|
||
|
|
Investor
Remittances and Reporting
|
|||
|
1122(d)(3)(i)
|
Reports
to investors, including those to be filed with the Commission,
are
maintained in accordance with the transaction agreements and
applicable
Commission requirements. Specifically, such reports (A) are prepared
in
accordance with timeframes and other terms set forth in the transaction
agreements; (B) provide information calculated in accordance
with the
terms specified in the transaction agreements; (C) are filed
with the
Commission as required by its rules and regulations; and (D)
agree with
investors’ or the trustee’s records as to the total unpaid principal
balance and number of mortgage loans serviced by the
Servicer.
|
X
|
||
|
Servicing
Criteria
|
Applicable
Servicing Criteria
|
|
|
Reference
|
Criteria
|
|
|
1122(d)(3)(ii)
|
Amounts
due to investors are allocated and remitted in accordance with timeframes,
distribution priority and other terms set forth in the transaction
agreements.
|
X
|
||
|
1122(d)(3)(iii)
|
Disbursements
made to an investor are posted within two business days to the Servicer’s
investor records, or such other number of days specified in the
transaction agreements.
|
X
|
||
|
1122(d)(3)(iv)
|
Amounts
remitted to investors per the investor reports agree with cancelled
checks, or other form of payment, or custodial bank
statements.
|
X
|
||
|
|
Pool
Asset Administration
|
|||
|
1122(d)(4)(i)
|
Collateral
or security on mortgage loans is maintained as required by the transaction
agreements or related mortgage loan documents.
|
X
|
||
|
1122(d)(4)(ii)
|
Mortgage
loan and related documents are safeguarded as required by the transaction
agreements
|
X
|
||
|
1122(d)(4)(iii)
|
Any
additions, removals or substitutions to the asset pool are made,
reviewed
and approved in accordance with any conditions or requirements in
the
transaction agreements.
|
X
|
||
|
1122(d)(4)(iv)
|
Payments
on mortgage loans, including any payoffs, made in accordance with
the
related mortgage loan documents are posted to the Servicer’s obligor
records maintained no more than two business days after receipt,
or such
other number of days specified in the transaction agreements, and
allocated to principal, interest or other items (e.g., escrow) in
accordance with the related mortgage loan documents.
|
X
|
||
|
1122(d)(4)(v)
|
The
Servicer’s records regarding the mortgage loans agree with the Servicer’s
records with respect to an obligor’s unpaid principal
balance.
|
X
|
||
|
1122(d)(4)(vi)
|
Changes
with respect to the terms or status of an obligor's mortgage loans
(e.g.,
loan modifications or re-agings) are made, reviewed and approved
by
authorized personnel in accordance with the transaction agreements
and
related pool asset documents.
|
X
|
||
|
1122(d)(4)(vii)
|
Loss
mitigation or recovery actions (e.g., forbearance plans, modifications
and
deeds in lieu of foreclosure, foreclosures and repossessions, as
applicable) are initiated, conducted and concluded in accordance
with the
timeframes or other requirements established by the transaction
agreements.
|
X
|
||
|
1122(d)(4)(viii)
|
Records
documenting collection efforts are maintained during the period a
mortgage
loan is delinquent in accordance with the transaction agreements.
Such
records are maintained on at least a monthly basis, or such other
period
specified in the transaction agreements, and describe the entity’s
activities in monitoring delinquent mortgage loans including, for
example,
phone calls, letters and payment rescheduling plans in cases where
delinquency is deemed temporary (e.g., illness or
unemployment).
|
X
|
||
|
1122(d)(4)(ix)
|
Adjustments
to interest rates or rates of return for mortgage loans with variable
rates are computed based on the related mortgage loan
documents.
|
X
|
||
|
1122(d)(4)(x)
|
Regarding
any funds held in trust for an obligor (such as escrow accounts):
(A) such
funds are analyzed, in accordance with the obligor’s mortgage loan
documents, on at least an annual basis, or such other period specified
in
the transaction agreements; (B) interest on such funds is paid, or
credited, to obligors in accordance with applicable mortgage loan
documents and state laws; and (C) such funds are returned to the
obligor
within 30 calendar days of full repayment of the related mortgage
loans,
or such other number of days specified in the transaction
agreements.
|
X
|
||
|
1122(d)(4)(xi)
|
Payments
made on behalf of an obligor (such as tax or insurance payments)
are made
on or before the related penalty or expiration dates, as indicated
on the
appropriate bills or notices for such payments, provided that such
support
has been received by the servicer at least 30 calendar days prior
to these
dates, or such other number of days specified in the transaction
agreements.
|
X
|
||
|
1122(d)(4)(xii)
|
Any
late payment penalties in connection with any payment to be made
on behalf
of an obligor are paid from the servicer’s funds and not charged to the
obligor, unless the late payment was due to the obligor’s error or
omission.
|
X
|
||
|
1122(d)(4)(xiii)
|
Disbursements
made on behalf of an obligor are posted within two business days
to the
obligor’s records maintained by the servicer, or such other number of days
specified in the transaction agreements.
|
X
|
||
|
1122(d)(4)(xiv)
|
Delinquencies,
charge-offs and uncollectible accounts are recognized and recorded
in
accordance with the transaction agreements.
|
X
|
|
Servicing
Criteria
|
Applicable
Servicing Criteria
|
|
|
Reference
|
Criteria
|
|
|
1122(d)(4)(xv)
|
Any
external enhancement or other support, identified in Item 1114(a)(1)
through (3) or Item 1115 of Regulation AB, is maintained as set
forth in
the transaction agreements.
|
|||
|
|
|
|
| [NAME OF COMPANY] [NAME OF SUBSERVICER] | ||
| Date: | ||
| |
|
|
| By: | ||
|
|
Name:
Title:
|
▇▇▇.
▇-▇