Msac 2006-NC1 – ‘8-K’ for 1/27/06 – EX-4

On:  Tuesday, 2/14/06, at 2:08pm ET   ·   For:  1/27/06   ·   Accession #:  914121-6-311   ·   File #:  333-121914-18

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Current Report   —   Form 8-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 8-K         Current Report                                         5     20K 
 2: EX-4        Pooling and Servicing Agreement                      341±  1.31M 
 3: EX-5        Opinion Letter of Cwt                                  3±    12K 

EX-4   —   Pooling and Servicing Agreement
Exhibit Table of Contents

EX-4
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                                                                       EXHIBIT 4

                                                                  EXECUTION COPY

MORGAN STANLEY ABS CAPITAL I INC.,
Depositor,

HOMEQ SERVICING CORPORATION,
 Servicer,

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION,
 Servicer,

 NC CAPITAL CORPORATION,
Responsible Party,

 and

 DEUTSCHE BANK NATIONAL TRUST COMPANY,
 Trustee

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

 POOLING AND SERVICING AGREEMENT

 Dated as of January 1, 2006

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

MORGAN STANLEY ABS CAPITAL I INC. TRUST 2006-NC1

 MORTGAGE PASS-THROUGH CERTIFICATES,
 SERIES 2006-NC1

EX-4
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 TABLE OF CONTENTS

 ARTICLE I

 DEFINITIONS

ARTICLE II

 CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES

Section 2.01     Conveyance of Mortgage Loans...................................
Section 2.02     Acceptance by the Trustee of the Mortgage Loans................
Section 2.03     Representations and Warranties; Remedies for Breaches of       
        Representations and Warranties with Respect to the
                   Mortgage Loans...............................................
Section 2.04     Execution and Delivery of Certificates.........................
Section 2.05     REMIC Matters..................................................
Section 2.06     Representations and Warranties of the Depositor................

 ARTICLE III

ADMINISTRATION AND SERVICING
 OF MORTGAGE LOANS

Section 3.01     Servicers to Service Mortgage Loans............................
Section 3.02     Subservicing Agreements between a Servicer                     
                   and Subservicers.............................................
Section 3.03     Successor Subservicers.........................................
Section 3.04     Liability of the Servicers.....................................
Section 3.05     No Contractual Relationship between Subservicers               
                   and the Trustee..............................................
Section 3.06     Assumption or Termination of Subservicing Agreements           
                   by Trustee...................................................
Section 3.07     Collection of Certain Mortgage Loan Payments...................
Section 3.08     Subservicing Accounts..........................................
Section 3.09     Collection of Taxes, Assessments and Similar Items;            
                   Escrow Accounts..............................................
Section 3.10     Collection Accounts............................................
Section 3.11     Withdrawals from the Collection Accounts.......................
Section 3.12     Investment of Funds in the Collection Accounts and the         
                   Distribution Account.........................................
Section 3.13     Maintenance of Hazard Insurance and Errors and Omissions       
                   and Fidelity Coverage........................................
Section 3.14     Enforcement of "Due-on-Sale" Clauses; Assumption Agreements....
Section 3.15     Realization upon Defaulted Mortgage Loans......................
Section 3.16     Release of Mortgage Files......................................
Section 3.17     Title, Conservation and Disposition of REO Property............
Section 3.18     Notification of Adjustments....................................
Section 3.19     Access to Certain Documentation and Information                
                   Regarding the Mortgage Loans.................................
Section 3.20     Documents, Records and Funds in Possession of the Servicers    
                   to Be Held for the Trustee...................................
Section 3.21     Servicing Compensation.........................................
Section 3.22     Annual Statement as to Compliance..............................
Section 3.23     Annual Reports on Assessment of Compliance with                
                Servicing Criteria; Annual Independent Public Accountants'
                   Attestation Report...........................................
Section 3.24     Trustee to Act as Servicer.....................................
Section 3.25     Compensating Interest..........................................
Section 3.26     Credit Reporting; Gramm-Leach-Bliley Act.......................

ARTICLE IV

 DISTRIBUTIONS AND
 ADVANCES BY THE SERVICERS

Section 4.01     Advances.......................................................
Section 4.02     Priorities of Distribution.....................................
Section 4.03     Monthly Statements to Certificateholders.......................
Section 4.04     Certain Matters Relating to the Determination of LIBOR.........
Section 4.05     Allocation of Applied Realized Loss Amounts....................
Section 4.06     Swap Account...................................................

 ARTICLE V

THE CERTIFICATES

Section 5.01     The Certificates...............................................
Section 5.02     Certificate Register; Registration of Transfer and             
                   Exchange of Certificates.....................................
Section 5.03     Mutilated, Destroyed, Lost or Stolen Certificates..............
Section 5.04     Persons Deemed Owners..........................................
Section 5.05     Access to List of Certificateholders' Names and Addresses......
Section 5.06     Maintenance of Office or Agency................................

ARTICLE VI

 THE DEPOSITOR AND THE SERVICERS

Section 6.01     Respective Liabilities of the Depositor and the Servicers......
Section 6.02     Merger or Consolidation of the Depositor or a Servicer.........
Section 6.03     Limitation on Liability of the Depositor, the                  
                   Servicers and Others.........................................
Section 6.04     Limitation on Resignation of a Servicer........................
Section 6.05     Additional Indemnification by the Servicers;                   
                   Third Party Claims...........................................

 ARTICLE VII

 DEFAULT

Section 7.01     Events of Default..............................................
Section 7.02     Trustee to Act; Appointment of Successor.......................
Section 7.03     Notification to Certificateholders.............................

ARTICLE VIII

CONCERNING THE TRUSTEE

Section 8.01     Duties of the Trustee..........................................
Section 8.02     Certain Matters Affecting the Trustee..........................
Section 8.03     Trustee Not Liable for Certificates or Mortgage Loans..........
Section 8.04     Trustee May Own Certificates...................................
Section 8.05     Trustee's Fees and Expenses....................................
Section 8.06     Eligibility Requirements for the Trustee.......................
Section 8.07     Resignation and Removal of the Trustee.........................
Section 8.08     Successor Trustee..............................................
Section 8.09     Merger or Consolidation of the Trustee.........................
Section 8.10     Appointment of Co-Trustee or Separate Trustee..................
Section 8.11     Tax Matters....................................................
Section 8.12     Periodic Filings...............................................
Section 8.13     Tax Treatment of Upper-Tier CarryForward Amounts,              
              Basis Risk CarryForward Amounts and Class IO Shortfalls;
            Tax Classification of the Excess Reserve Fund Account,
                   Swap Account and the Interest Rate Swap Agreement............

ARTICLE IX

 TERMINATION

Section 9.01     Termination upon Liquidation or Purchase of the                
                   Mortgage Loans...............................................
Section 9.02     Final Distribution on the Certificates.........................
Section 9.03     Additional Termination Requirements............................

 ARTICLE X

MISCELLANEOUS PROVISIONS

Section 10.01    Amendment......................................................
Section 10.02    Recordation of Agreement; Counterparts.........................
Section 10.03    Governing Law..................................................
Section 10.04    Intention of Parties...........................................
Section 10.05    Notices........................................................
Section 10.06    Severability of Provisions.....................................
Section 10.07    Assignment; Sales; Advance Facilities..........................
Section 10.08    Limitation on Rights of Certificateholders.....................
Section 10.09    Inspection and Audit Rights....................................
Section 10.10    Certificates Nonassessable and Fully Paid......................
Section 10.11    Rule of Construction...........................................
Section 10.12    Waiver of Jury Trial...........................................
Section 10.13    Rights of the Swap Provider....................................
Section 10.14    Regulation AB Compliance; Intent of the Parties;               
                   Reasonableness...............................................

SCHEDULES                                                                       

Schedule I       Mortgage Loan Schedule                                         

Schedule II      Representations and Warranties of HomEq, as Servicer           

Schedule III     Representations and Warranties as to the Mortgage Loans        

Schedule IV      Representations and Warranties of JPMorgan Chase Bank,         
National Association, as Servicer             

Schedule V       Representations and Warranties of Morgan Stanley ABS Capital I 
Inc. as to the Mortgage Loans                 

Schedule VI      Representations and Warranties of JPMorgan, as Servicer        

EXHIBITS                                                                        

Exhibit A        Form of Class A, Class M and Class B Certificate               

Exhibit B        Form of Class P Certificate                                    

Exhibit C        Form of Class R Certificate                                    

Exhibit D        Form of Class X Certificate                                    

Exhibit E        Form of Initial Certification of Trustee                       

Exhibit F        Form of Document Certification and Exception Report of Trustee 

Exhibit G        Form of Residual Transfer Affidavit                            

Exhibit H        Form of Transferor Certificate                                 

Exhibit I        Form of Rule 144A Letter                                       

Exhibit J        Form of Request for Release                                    

Exhibit K        Form of Contents for Each Mortgage File                        

Exhibit L        Form of Certification to be provided with Form 10-K            

Exhibit M        Form of Certification to be provided by the Trustee to be      
provided to Depositor                         

Exhibit N        Form of Certification of the Servicer to be provided by the    
applicable Servicer to  Depositor             

Exhibit O        Form of Servicer Power of Attorney                             

Exhibit P        Servicing Criteria                                             

Exhibit Q        Additional Form 10-D Disclosure                                

Exhibit R        Additional Form 10-K Disclosure                                

Exhibit S        Form 8-K Disclosure Information                                

Exhibit T        Interest Rate Swap Agreement                                   

Exhibit U        Purchase Agreement                                             

Exhibit V        Subservicing Agreement                                         

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          THIS POOLING AND SERVICING AGREEMENT, dated as of January 1, 2006,
among MORGAN STANLEY ABS CAPITAL I INC., a Delaware corporation, as depositor   
(the "Depositor"), JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, a national banking
association ("JPMorgan"), HOMEQ SERVICING CORPORATION, a New Jersey corporation 
("HomEq" and together with JPMorgan, the "Servicers"), NC CAPITAL CORPORATION, a
California corporation, as responsible party (the "Responsible Party"), and     
DEUTSCHE BANK NATIONAL TRUST COMPANY, a national banking association, as trustee
(the "Trustee").                                                                

W I T N E S S E T H:

       In consideration of the mutual agreements herein contained, the
parties hereto agree as follows:                                                

 PRELIMINARY STATEMENT

           The Trustee shall elect that four segregated asset pools within the
Trust Fund (exclusive of (i) the Prepayment Premiums, (ii) the Swap Assets,     
(iii) the Excess Reserve Fund Account, and (iv) the right of the LIBOR          
Certificates to receive Upper-Tier CarryForward Amounts including, but without  
duplication, Basis Risk CarryForward Amounts and the obligation to pay Class IO 
Shortfalls) be treated for federal income tax purposes as comprising four REMICs
(each, a "Trust REMIC" or, in the alternative, Pooling-Tier REMIC-1,            
Pooling-Tier REMIC-2, the Lower-Tier REMIC and the Upper-Tier REMIC,            
respectively). The Class X Interest, Class IO Interest and each Class of LIBOR  
Certificates (other than the right of each Class of LIBOR Certificates to       
receive Upper-Tier CarryForward Amounts including, but without duplication,     
Basis Risk CarryForward Amounts and the obligation to pay Class IO Shortfalls)  
represents ownership of a regular interest in a REMIC for purposes of the REMIC 
Provisions. The Class R Certificates represent ownership of the sole class of   
residual interest in each Trust REMIC for purposes of the REMIC Provisions. The 
Startup Day for each REMIC described herein is the Closing Date. The latest     
possible maturity date for each regular interest is the latest date referenced  
in Section 2.05. The Upper-Tier REMIC shall hold as assets the several classes  
of uncertificated Lower-Tier Regular Interests, set out below. The Lower-Tier   
REMIC shall hold as assets the several classes of uncertificated Pooling-Tier   
REMIC-2 Regular Interests. Pooling-Tier REMIC-2 shall hold as assets the several
classes of uncertificated Pooling-Tier REMIC-1 Regular Interests. Pooling-Tier  
REMIC-1 shall hold as assets the assets of the Trust Fund (exclusive of (i) the 
Prepayment Premiums, (ii) the Swap Assets, (iii) the Excess Reserve Fund        
Account, and (iv) the right of the LIBOR Certificates to receive Upper-Tier     
CarryForward Amounts including, but without duplication, Basis Risk CarryForward
Amounts and the obligation to pay Class IO Shortfalls).                         

         For federal income tax purposes, each Class of LIBOR Certificates
represents a beneficial ownership of a regular interest in the Upper-Tier REMIC,
the right to receive Upper-Tier CarryForward Amounts (including, but without    
duplication, Basis Risk CarryForward Amounts), and the obligation to pay Class  
IO Shortfalls, the Class X Certificates represent beneficial ownership of the   
Class X Interest, the Class IO Interest, the Interest Rate Swap Agreement, the  
Swap Account, the Excess Reserve Fund Account and the right to receive Class IO 
Shortfalls, and the Class P Certificates represent beneficial ownership of the  
Prepayment Premiums, which portions of the Trust Fund shall be treated as a     
grantor trust.                                                                  

Pooling-Tier REMIC-1

   Pooling-Tier REMIC-1 shall issue the following interests in
Pooling-Tier REMIC-1, and each such interest, other than the Class PT1-R        
Interest is hereby designated as a regular interest in the Pooling-Tier REMIC-1.
Pooling-Tier REMIC-1 shall also issue the Class PT1-R Interest, which is hereby 
designated as the sole class of residual interest in Pooling-Tier REMIC-1. The  
Class PT1-R Interest shall be represented by the Class R Certificates, shall not
have a principal balance and shall have no interest rate.                       

                             Pooling-Tier REMIC-1     Initial Pooling-Tier
Pooling-Tier REMIC-1 Interest     Interest Rate        REMIC-1 Principal Amount 
-----------------------------   --------------------   ------------------------ 
Class PT1-1                             (1)            $          64,804,578.40 
Class PT1-2A                            (2)            $          23,259,632.15 
Class PT1-2B                            (3)            $          23,259,632.15 
Class PT1-3A                            (2)            $          22,521,389.45 
Class PT1-3B                            (3)            $          22,521,389.45 
Class PT1-4A                            (2)            $          21,821,041.55 
Class PT1-4B                            (3)            $          21,821,041.55 
Class PT1-5A                            (2)            $          21,155,495.15 
Class PT1-5B                            (3)            $          21,155,495.15 
Class PT1-6A                            (2)            $          20,521,697.70 
Class PT1-6B                            (3)            $          20,521,697.70 
Class PT1-7A                            (2)            $          19,916,818.10 
Class PT1-7B                            (3)            $          19,916,818.10 
Class PT1-8A                            (2)            $          19,338,073.35 
Class PT1-8B                            (3)            $          19,338,073.35 
Class PT1-9A                            (2)            $          18,782,796.45 
Class PT1-9B                            (3)            $          18,782,796.45 
Class PT1-10A                           (2)            $          18,248,443.40 
Class PT1-10B                           (3)            $          18,248,443.40 
Class PT1-11A                           (2)            $          17,732,500.35 
Class PT1-11B                           (3)            $          17,732,500.35 
Class PT1-12A                           (2)            $          17,232,554.05 
Class PT1-12B                           (3)            $          17,232,554.05 
Class PT1-13A                           (2)            $          16,746,016.30 
Class PT1-13B                           (3)            $          16,746,016.30 
Class PT1-14A                           (2)            $          16,032,171.70 
Class PT1-14B                           (3)            $          16,032,171.70 
Class PT1-15A                           (2)            $          15,347,875.05 
Class PT1-15B                           (3)            $          15,347,875.05 
Class PT1-16A                           (2)            $          14,692,984.45 
Class PT1-16B                           (3)            $          14,692,984.45 
Class PT1-17A                           (2)            $          14,066,228.65 
Class PT1-17B                           (3)            $          14,066,228.65 
Class PT1-18A                           (2)            $          13,466,391.55 
Class PT1-18B                           (3)            $          13,466,391.55 
Class PT1-19A                           (2)            $          12,892,309.90 
Class PT1-19B                           (3)            $          12,892,309.90 
Class PT1-20A                           (2)            $          12,394,501.90 
Class PT1-20B                           (3)            $          12,394,501.90 
Class PT1-21A                           (2)            $          13,185,262.25 
Class PT1-21B                           (3)            $          13,185,262.25 
Class PT1-22A                           (2)            $         181,822,781.10 
Class PT1-22B                           (3)            $         181,822,781.10 
Class PT1-23A                           (2)            $           3,103,091.90 
Class PT1-23B                           (3)            $           3,103,091.90 
Class PT1-24A                           (2)            $           2,988,827.55 
Class PT1-24B                           (3)            $           2,988,827.55 
Class PT1-25A                           (2)            $           2,878,790.75 
Class PT1-25B                           (3)            $           2,878,790.75 
Class PT1-26A                           (2)            $           2,772,823.90 
Class PT1-26B                           (3)            $           2,772,823.90 
Class PT1-27A                           (2)            $           2,670,775.60 
Class PT1-27B                           (3)            $           2,670,775.60 
Class PT1-28A                           (2)            $           2,572,507.45 
Class PT1-28B                           (3)            $           2,572,507.45 
Class PT1-29A                           (2)            $           2,478,828.15 
Class PT1-29B                           (3)            $           2,478,828.15 
Class PT1-30A                           (2)            $           2,387,598.45 
Class PT1-30B                           (3)            $           2,387,598.45 
Class PT1-31A                           (2)            $           2,299,741.10 
Class PT1-31B                           (3)            $           2,299,741.10 
Class PT1-32A                           (2)            $           2,416,568.15 
Class PT1-32B                           (3)            $           2,416,568.15 
Class PT1-33A                           (2)            $           6,381,705.40 
Class PT1-33B                           (3)            $           6,381,705.40 
Class PT1-34A                           (2)            $           4,801,008.50 
Class PT1-34B                           (3)            $           4,801,008.50 
Class PT1-35A                           (2)            $           1,656,828.60 
Class PT1-35B                           (3)            $           1,656,828.60 
Class PT1-36A                           (2)            $           1,598,497.60 
Class PT1-36B                           (3)            $           1,598,497.60 
Class PT1-37A                           (2)            $           1,542,206.55 
Class PT1-37B                           (3)            $           1,542,206.55 
Class PT1-38A                           (2)            $           1,487,884.50 
Class PT1-38B                           (3)            $           1,487,884.50 
Class PT1-39A                           (2)            $           1,435,463.15 
Class PT1-39B                           (3)            $           1,435,463.15 
Class PT1-40A                           (2)            $           1,384,901.95 
Class PT1-40B                           (3)            $           1,384,901.95 
Class PT1-41A                           (2)            $           1,336,105.55 
Class PT1-41B                           (3)            $           1,336,105.55 
Class PT1-42A                           (2)            $           1,288,994.70 
Class PT1-42B                           (3)            $           1,288,994.70 
Class PT1-43A                           (2)            $           1,243,533.75 
Class PT1-43B                           (3)            $           1,243,533.75 
Class PT1-44A                           (2)            $           1,199,665.35 
Class PT1-44B                           (3)            $           1,199,665.35 
Class PT1-45A                           (2)            $           1,157,334.15 
Class PT1-45B                           (3)            $           1,157,334.15 
Class PT1-46A                           (2)            $           1,116,490.55 
Class PT1-46B                           (3)            $           1,116,490.55 
Class PT1-47A                           (2)            $           1,077,082.65 
Class PT1-47B                           (3)            $           1,077,082.65 
Class PT1-48A                           (2)            $           1,039,047.95 
Class PT1-48B                           (3)            $           1,039,047.95 
Class PT1-49A                           (2)            $           1,002,347.25 
Class PT1-49B                           (3)            $           1,002,347.25 
Class PT1-50A                           (2)            $             966,934.00 
Class PT1-50B                           (3)            $             966,934.00 
Class PT1-51A                           (2)            $             932,763.40 
Class PT1-51B                           (3)            $             932,763.40 
Class PT1-52A                           (2)            $             899,792.00 
Class PT1-52B                           (3)            $             899,792.00 
Class PT1-53A                           (2)            $             867,978.10 
Class PT1-53B                           (3)            $             867,978.10 
Class PT1-54A                           (2)            $             837,281.35 
Class PT1-54B                           (3)            $             837,281.35 
Class PT1-55A                           (2)            $             807,662.60 
Class PT1-55B                           (3)            $             807,662.60 
Class PT1-56A                           (2)            $          21,835,471.15 
Class PT1-56B                           (3)            $          21,835,471.15 
Class PT1-R                             (4)                           (4)       

----------                                                                      

(1)   For any Distribution Date (and the related Interest Accrual Period), this 
    Pooling-Tier REMIC-1 Regular Interest shall bear interest at a per annum
     rate (its "Pooling-Tier REMIC-1 Interest Rate") equal to the Pooling-Tier
REMIC-1 WAC Rate.                                                   

(2)   For any Distribution Date (and the related Interest Accrual Period), this 
    Pooling-Tier REMIC-1 Regular Interest shall bear interest at a per annum
   rate (its "Pooling-Tier REMIC-1 Interest Rate") equal to the product of
  (i) 2 and (ii) the Pooling-Tier REMIC-1 WAC Rate, subject to a maximum
rate of 9.5000%.                                                    

(3)   For any Distribution Date (and the related Interest Accrual Period), this 
    Pooling-Tier REMIC-1 Regular Interest shall bear interest at a per annum
   rate (its "Pooling-Tier REMIC-1 Interest Rate") equal to the excess, if
  any, of (A) the product of (i) 2 and (ii) the Pooling-Tier REMIC-1 WAC
Rate over (B) 9.5000%.                                              

(4)   The Class PT1-R Interest shall not have a principal balance and shall not 
bear interest.                                                      

           On each Distribution Date, the interest distributable in respect of
the Mortgage Loans for such Distribution Date shall be deemed to be distributed 
to the Pooling-Tier REMIC-1 Regular Interests at the rates shown above.         

         On each Distribution Date, Realized Losses, Subsequent Recoveries
and payments of principal in respect of the Mortgage Loans shall be allocated to
the outstanding Pooling-Tier REMIC-1 Regular Interest with the lowest numerical 
denomination until the Pooling-Tier REMIC-1 Principal Amount of such interest is
reduced to zero, provided that, with respect to Pooling-Tier REMIC-1 Regular    
Interests with the same numerical denomination, such Realized Losses, Subsequent
Recoveries and payments of principal shall be allocated pro rata between such   
Pooling-Tier REMIC-1 Regular Interests, until the Pooling-Tier REMIC-1 Principal
Amount of such interests is reduced to zero.                                    

Pooling-Tier REMIC-2

   Pooling-Tier REMIC-2 shall issue the following interests in
Pooling-Tier REMIC-2, and each such interest, other than the Class PT2-R        
Interest, is hereby designated as a regular interest in Pooling-Tier REMIC-2.   
The Class PT2-R Interest is hereby designated as the sole class of residual     
interest in Pooling-Tier REMIC-2 and shall be represented by the Class R        
Certificates.                                                                   

                                                        [Enlarge/Download Table]


                                                                                        Corresponding      Corresponding  
                                                                     Corresponding      Pooling-Tier         Scheduled    
  Pooling-Tier    Pooling-Tier REMIC-2    Pooling-Tier REMIC-2       Pooling-Tier          REMIC-1           Crossover    
REMIC-2 Interest     Interest Rate      Initial Principal Amount  REMIC-2 IO Interest  Regular Interest  Distribution Date
----------------  --------------------  ------------------------  -------------------  ----------------  ---------------- 
                                                                                                                          
Class PT2-1               (1)           $         64,804,578.40           N/A                N/A               N/A        
Class PT2-2A              (2)           $         23,259,632.15     Class PT2-IO-2           N/A               N/A        
Class PT2-2B              (3)           $         23,259,632.15           N/A                N/A               N/A        
Class PT2-3A              (2)           $         22,521,389.45     Class PT2-IO-3           N/A               N/A        
Class PT2-3B              (3)           $         22,521,389.45           N/A                N/A               N/A        
Class PT2-4A              (2)           $         21,821,041.55     Class PT2-IO-4           N/A               N/A        
Class PT2-4B              (3)           $         21,821,041.55           N/A                N/A               N/A        
Class PT2-5A              (2)           $         21,155,495.15     Class PT2-IO-5           N/A               N/A        
Class PT2-5B              (3)           $         21,155,495.15           N/A                N/A               N/A        
Class PT2-6A              (2)           $         20,521,697.70     Class PT2-IO-6           N/A               N/A        
Class PT2-6B              (3)           $         20,521,697.70           N/A                N/A               N/A        
Class PT2-7A              (2)           $         19,916,818.10     Class PT2-IO-7           N/A               N/A        
Class PT2-7B              (3)           $         19,916,818.10           N/A                N/A               N/A        
Class PT2-8A              (2)           $         19,338,073.35     Class PT2-IO-8           N/A               N/A        
Class PT2-8B              (3)           $         19,338,073.35           N/A                N/A               N/A        
Class PT2-9A              (2)           $         18,782,796.45     Class PT2-IO-9           N/A               N/A        
Class PT2-9B              (3)           $         18,782,796.45           N/A                N/A               N/A        
Class PT2-10A             (2)           $         18,248,443.40     Class PT2-IO-10          N/A               N/A        
Class PT2-10B             (3)           $         18,248,443.40           N/A                N/A               N/A        
Class PT2-11A             (2)           $         17,732,500.35     Class PT2-IO-11          N/A               N/A        
Class PT2-11B             (3)           $         17,732,500.35           N/A                N/A               N/A        
Class PT2-12A             (2)           $         17,232,554.05     Class PT2-IO-12          N/A               N/A        
Class PT2-12B             (3)           $         17,232,554.05           N/A                N/A               N/A        
Class PT2-13A             (2)           $         16,746,016.30     Class PT2-IO-13          N/A               N/A        
Class PT2-13B             (3)           $         16,746,016.30           N/A                N/A               N/A        
Class PT2-14A             (2)           $         16,032,171.70     Class PT2-IO-14          N/A               N/A        
Class PT2-14B             (3)           $         16,032,171.70           N/A                N/A               N/A        
Class PT2-15A             (2)           $         15,347,875.05     Class PT2-IO-15          N/A               N/A        
Class PT2-15B             (3)           $         15,347,875.05           N/A                N/A               N/A        
Class PT2-16A             (2)           $         14,692,984.45     Class PT2-IO-16          N/A               N/A        
Class PT2-16B             (3)           $         14,692,984.45           N/A                N/A               N/A        
Class PT2-17A             (2)           $         14,066,228.65     Class PT2-IO-17          N/A               N/A        
Class PT2-17B             (3)           $         14,066,228.65           N/A                N/A               N/A        
Class PT2-18A             (2)           $         13,466,391.55     Class PT2-IO-18          N/A               N/A        
Class PT2-18B             (3)           $         13,466,391.55           N/A                N/A               N/A        
Class PT2-19A             (2)           $         12,892,309.90     Class PT2-IO-19          N/A               N/A        
Class PT2-19B             (3)           $         12,892,309.90           N/A                N/A               N/A        
Class PT2-20A             (2)           $         12,394,501.90     Class PT2-IO-20          N/A               N/A        
Class PT2-20B             (3)           $         12,394,501.90           N/A                N/A               N/A        
Class PT2-21A             (2)           $         13,185,262.25     Class PT2-IO-21          N/A               N/A        
Class PT2-21B             (3)           $         13,185,262.25           N/A                N/A               N/A        
Class PT2-22A             (2)           $        181,822,781.10     Class PT2-IO-22          N/A               N/A        
Class PT2-22B             (3)           $        181,822,781.10           N/A                N/A               N/A        
Class PT2-23A             (2)           $          3,103,091.90     Class PT2-IO-23          N/A               N/A        
Class PT2-23B             (3)           $          3,103,091.90           N/A                N/A               N/A        
Class PT2-24A             (2)           $          2,988,827.55     Class PT2-IO-24          N/A               N/A        
Class PT2-24B             (3)           $          2,988,827.55           N/A                N/A               N/A        
Class PT2-25A             (2)           $          2,878,790.75     Class PT2-IO-25          N/A               N/A        
Class PT2-25B             (3)           $          2,878,790.75           N/A                N/A               N/A        
Class PT2-26A             (2)           $          2,772,823.90     Class PT2-IO-26          N/A               N/A        
Class PT2-26B             (3)           $          2,772,823.90           N/A                N/A               N/A        
Class PT2-27A             (2)           $          2,670,775.60     Class PT2-IO-27          N/A               N/A        
Class PT2-27B             (3)           $          2,670,775.60           N/A                N/A               N/A        
Class PT2-28A             (2)           $          2,572,507.45     Class PT2-IO-28          N/A               N/A        
Class PT2-28B             (3)           $          2,572,507.45           N/A                N/A               N/A        
Class PT2-29A             (2)           $          2,478,828.15     Class PT2-IO-29          N/A               N/A        
Class PT2-29B             (3)           $          2,478,828.15           N/A                N/A               N/A        
Class PT2-30A             (2)           $          2,387,598.45     Class PT2-IO-30          N/A               N/A        
Class PT2-30B             (3)           $          2,387,598.45           N/A                N/A               N/A        
Class PT2-31A             (2)           $          2,299,741.10     Class PT2-IO-31          N/A               N/A        
Class PT2-31B             (3)           $          2,299,741.10           N/A                N/A               N/A        
Class PT2-32A             (2)           $          2,416,568.15     Class PT2-IO-32          N/A               N/A        
Class PT2-32B             (3)           $          2,416,568.15           N/A                N/A               N/A        
Class PT2-33A             (2)           $          6,381,705.40     Class PT2-IO-33          N/A               N/A        
Class PT2-33B             (3)           $          6,381,705.40           N/A                N/A               N/A        
Class PT2-34A             (2)           $          4,801,008.50     Class PT2-IO-34          N/A               N/A        
Class PT2-34B             (3)           $          4,801,008.50           N/A                N/A               N/A        
Class PT2-35A             (2)           $          1,656,828.60     Class PT2-IO-35          N/A               N/A        
Class PT2-35B             (3)           $          1,656,828.60           N/A                N/A               N/A        
Class PT2-36A             (2)           $          1,598,497.60     Class PT2-IO-36          N/A               N/A        
Class PT2-36B             (3)           $          1,598,497.60           N/A                N/A               N/A        
Class PT2-37A             (2)           $          1,542,206.55     Class PT2-IO-37          N/A               N/A        
Class PT2-37B             (3)           $          1,542,206.55           N/A                N/A               N/A        
Class PT2-38A             (2)           $          1,487,884.50     Class PT2-IO-38          N/A               N/A        
Class PT2-38B             (3)           $          1,487,884.50           N/A                N/A               N/A        
Class PT2-39A             (2)           $          1,435,463.15     Class PT2-IO-39          N/A               N/A        
Class PT2-39B             (3)           $          1,435,463.15           N/A                N/A               N/A        
Class PT2-40A             (2)           $          1,384,901.95     Class PT2-IO-40          N/A               N/A        
Class PT2-40B             (3)           $          1,384,901.95           N/A                N/A               N/A        
Class PT2-41A             (2)           $          1,336,105.55     Class PT2-IO-41          N/A               N/A        
Class PT2-41B             (3)           $          1,336,105.55           N/A                N/A               N/A        
Class PT2-42A             (2)           $          1,288,994.70     Class PT2-IO-42          N/A               N/A        
Class PT2-42B             (3)           $          1,288,994.70           N/A                N/A               N/A        
Class PT2-43A             (2)           $          1,243,533.75     Class PT2-IO-43          N/A               N/A        
Class PT2-43B             (3)           $          1,243,533.75           N/A                N/A               N/A        
Class PT2-44A             (2)           $          1,199,665.35     Class PT2-IO-44          N/A               N/A        
Class PT2-44B             (3)           $          1,199,665.35           N/A                N/A               N/A        
Class PT2-45A             (2)           $          1,157,334.15     Class PT2-IO-45          N/A               N/A        
Class PT2-45B             (3)           $          1,157,334.15           N/A                N/A               N/A        
Class PT2-46A             (2)           $          1,116,490.55     Class PT2-IO-46          N/A               N/A        
Class PT2-46B             (3)           $          1,116,490.55           N/A                N/A               N/A        
Class PT2-47A             (2)           $          1,077,082.65     Class PT2-IO-47          N/A               N/A        
Class PT2-47B             (3)           $          1,077,082.65           N/A                N/A               N/A        
Class PT2-48A             (2)           $          1,039,047.95     Class PT2-IO-48          N/A               N/A        
Class PT2-48B             (3)           $          1,039,047.95           N/A                N/A               N/A        
Class PT2-49A             (2)           $          1,002,347.25     Class PT2-IO-49          N/A               N/A        
Class PT2-49B             (3)           $          1,002,347.25           N/A                N/A               N/A        
Class PT2-50A             (2)           $            966,934.00     Class PT2-IO-50          N/A               N/A        
Class PT2-50B             (3)           $            966,934.00           N/A                N/A               N/A        
Class PT2-51A             (2)           $            932,763.40     Class PT2-IO-51          N/A               N/A        
Class PT2-51B             (3)           $            932,763.40           N/A                N/A               N/A        
Class PT2-52A             (2)           $            899,792.00     Class PT2-IO-52          N/A               N/A        
Class PT2-52B             (3)           $            899,792.00           N/A                N/A               N/A        
Class PT2-53A             (2)           $            867,978.10     Class PT2-IO-53          N/A               N/A        
Class PT2-53B             (3)           $            867,978.10           N/A                N/A               N/A        
Class PT2-54A             (2)           $            837,281.35     Class PT2-IO-54          N/A               N/A        
Class PT2-54B             (3)           $            837,281.35           N/A                N/A               N/A        
Class PT2-55A             (2)           $            807,662.60     Class PT2-IO-55          N/A               N/A        
Class PT2-55B             (3)           $            807,662.60           N/A                N/A               N/A        
Class PT2-56A             (2)           $         21,835,471.15     Class PT2-IO-56          N/A               N/A        
Class PT2-56B             (3)           $         21,835,471.15           N/A                N/A               N/A        
Class PT2-IO-2            (4)                      (4)                    N/A            Class PT1-2A      February 2006  
Class PT2-IO-3            (4)                      (4)                    N/A            Class PT1-3A        March 2006   
Class PT2-IO-4            (4)                      (4)                    N/A            Class PT1-4A        April 2006   
Class PT2-IO-5            (4)                      (4)                    N/A            Class PT1-5A         May 2006    
Class PT2-IO-6            (4)                      (4)                    N/A            Class PT1-6A        June 2006    
Class PT2-IO-7            (4)                      (4)                    N/A            Class PT1-7A        July 2006    
Class PT2-IO-8            (4)                      (4)                    N/A            Class PT1-8A       August 2006   
Class PT2-IO-9            (4)                      (4)                    N/A            Class PT1-9A      September 2006 
Class PT2-IO-10           (4)                      (4)                    N/A            Class PT1-10A      October 2006  
Class PT2-IO-11           (4)                      (4)                    N/A            Class PT1-11A     November 2006  
Class PT2-IO-12           (4)                      (4)                    N/A            Class PT1-12A     December 2006  
Class PT2-IO-13           (4)                      (4)                    N/A            Class PT1-13A      January 2007  
Class PT2-IO-14           (4)                      (4)                    N/A            Class PT1-14A     February 2007  
Class PT2-IO-15           (4)                      (4)                    N/A            Class PT1-15A       March 2007   
Class PT2-IO-16           (4)                      (4)                    N/A            Class PT1-16A       April 2007   
Class PT2-IO-17           (4)                      (4)                    N/A            Class PT1-17A        May 2007    
Class PT2-IO-18           (4)                      (4)                    N/A            Class PT1-18A       June 2007    
Class PT2-IO-19           (4)                      (4)                    N/A            Class PT1-19A       July 2007    
Class PT2-IO-20           (4)                      (4)                    N/A            Class PT1-20A      August 2007   
Class PT2-IO-21           (4)                      (4)                    N/A            Class PT1-21A     September 2007 
Class PT2-IO-22           (4)                      (4)                    N/A            Class PT1-22A      October 2007  
Class PT2-IO-23           (4)                      (4)                    N/A            Class PT1-23A     November 2007  
Class PT2-IO-24           (4)                      (4)                    N/A            Class PT1-24A     December 2007  
Class PT2-IO-25           (4)                      (4)                    N/A            Class PT1-25A      January 2008  
Class PT2-IO-26           (4)                      (4)                    N/A            Class PT1-26A     February 2008  
Class PT2-IO-27           (4)                      (4)                    N/A            Class PT1-27A       March 2008   
Class PT2-IO-28           (4)                      (4)                    N/A            Class PT1-28A       April 2008   
Class PT2-IO-29           (4)                      (4)                    N/A            Class PT1-29A        May 2008    
Class PT2-IO-30           (4)                      (4)                    N/A            Class PT1-30A       June 2008    
Class PT2-IO-31           (4)                      (4)                    N/A            Class PT1-31A       July 2008    
Class PT2-IO-32           (4)                      (4)                    N/A            Class PT1-32A      August 2008   
Class PT2-IO-33           (4)                      (4)                    N/A            Class PT1-33A     September 2008 
Class PT2-IO-34           (4)                      (4)                    N/A            Class PT1-34A      October 2008  
Class PT2-IO-35           (4)                      (4)                    N/A            Class PT1-35A     November 2008  
Class PT2-IO-36           (4)                      (4)                    N/A            Class PT1-36A     December 2008  
Class PT2-IO-37           (4)                      (4)                    N/A            Class PT1-37A      January 2009  
Class PT2-IO-38           (4)                      (4)                    N/A            Class PT1-38A     February 2009  
Class PT2-IO-39           (4)                      (4)                    N/A            Class PT1-39A       March 2009   
Class PT2-IO-40           (4)                      (4)                    N/A            Class PT1-40A       April 2009   
Class PT2-IO-41           (4)                      (4)                    N/A            Class PT1-41A        May 2009    
Class PT2-IO-42           (4)                      (4)                    N/A            Class PT1-42A       June 2009    
Class PT2-IO-43           (4)                      (4)                    N/A            Class PT1-43A       July 2009    
Class PT2-IO-44           (4)                      (4)                    N/A            Class PT1-44A      August 2009   
Class PT2-IO-45           (4)                      (4)                    N/A            Class PT1-45A     September 2009 
Class PT2-IO-46           (4)                      (4)                    N/A            Class PT1-46A      October 2009  
Class PT2-IO-47           (4)                      (4)                    N/A            Class PT1-47A     November 2009  
Class PT2-IO-48           (4)                      (4)                    N/A            Class PT1-48A     December 2009  
Class PT2-IO-49           (4)                      (4)                    N/A            Class PT1-49A      January 2010  
Class PT2-IO-50           (4)                      (4)                    N/A            Class PT1-50A     February 2010  
Class PT2-IO-51           (4)                      (4)                    N/A            Class PT1-51A       March 2010   
Class PT2-IO-52           (4)                      (4)                    N/A            Class PT1-52A       April 2010   
Class PT2-IO-53           (4)                      (4)                    N/A            Class PT1-53A        May 2010    
Class PT2-IO-54           (4)                      (4)                    N/A            Class PT1-54A       June 2010    
Class PT2-IO-55           (4)                      (4)                    N/A            Class PT1-55A       July 2010    
Class PT2-IO-56           (4)                      (4)                    N/A            Class PT1-56A      August 2010   
Class PT2 R               (5)                      (5)                    N/A               N/A                N/A        


----------                                                                      

(1)   For any Distribution Date (and the related Interest Accrual Period), this 
    Pooling-Tier REMIC-2 Regular Interest shall bear interest at a per annum
     rate (its "Pooling-Tier REMIC-2 Interest Rate") equal to the Pooling-Tier
REMIC-1 WAC Rate.                                                   

(2)   For any Distribution Date (and the related Interest Accrual Period), this 
    Pooling-Tier REMIC-2 Regular Interest shall bear interest at a per annum
 rate (its "Pooling-Tier REMIC-2 Interest Rate") equal to the weighted
  average of the Pooling-Tier REMIC-1 Interest Rates on the Pooling-Tier
REMIC-1 Regular Interests having an "A" in their class designation, 
provided that, on each Distribution Date on which interest is       
     distributable on the Corresponding Pooling-Tier REMIC-2 IO Interest, this
    Pooling-Tier REMIC-2 Regular Interest shall bear interest at a per annum
    rate equal to Swap LIBOR subject to a maximum rate equal to the weighted
  average of the Pooling-Tier REMIC-1 Interest Rates on the Pooling-Tier
REMIC-1 Regular Interests having an "A" in their class designation. 

(3)   For any Distribution Date (and the related Interest Accrual Period), this 
    Pooling-Tier REMIC-2 Regular Interest shall bear interest at a per annum
 rate (its "Pooling-Tier REMIC-2 Interest Rate") equal to the weighted
  average of the Pooling-Tier REMIC-1 Interest Rates on the Pooling-Tier
REMIC-1 Regular Interests having a "B" in their class designation.  

(4)   Each Pooling-Tier REMIC-2 IO is an interest-only interest and does not    
      have a principal balance but has a notional balance ("Pooling-Tier REMIC-2
    IO Notional Balance") equal to the Pooling-Tier REMIC-2 Principal Amount
of the Corresponding Pooling-Tier REMIC-1 Regular Interest. From the
    Closing Date through and including the Corresponding Scheduled Crossover
      Distribution Date, each Pooling-Tier REMIC-2 IO Interest shall be entitled
      to receive interest that accrues on the Corresponding Pooling-Tier REMIC-1
Regular Interest at a rate equal to the excess, if any, of (i) the  
 Pooling-Tier REMIC-1 Interest Rate for the Corresponding Pooling-Tier
  REMIC-1 Regular Interest over (ii) Swap LIBOR. After the Corresponding
Scheduled Crossover Distribution Date, the Pooling-Tier REMIC-2 IO  
Interest shall not accrue interest.                                 

(5)   The Class PT2-R Interest shall not have a principal balance and shall not 
bear interest.                                                      

           On each Distribution Date, the interest distributable in respect of
the Mortgage Loans for such Distribution Date shall be distributed to the       
Pooling-Tier REMIC-2 Regular Interests at the Pooling-Tier REMIC-2 Interest     
Rates shown above.                                                              

         On each Distribution Date, Realized Losses, Subsequent Recoveries
and payments of principal in respect of the Mortgage Loans shall be allocated to
the then outstanding Pooling-Tier REMIC-2 Regular Interests (other than the     
Pooling-Tier REMIC-2 IO Interests) with the lowest numerical denomination until 
the Pooling-Tier REMIC-2 Principal Amount of such interest is reduced to zero,  
provided that, for Pooling-Tier REMIC-2 Regular Interests with the same         
numerical denomination, such Realized Losses, Subsequent Recoveries and payments
of principal shall be allocated pro rata between such Pooling-Tier REMIC-2      
Regular Interests, until the Pooling-Tier REMIC-2 Principal Amount of such      
interests is reduced to zero.                                                   

Lower-Tier REMIC

          The Lower-Tier REMIC shall issue the following interests, and each
such interest, other than the Class LT-R Interest, is hereby designated as a    
regular interest in the Lower-Tier REMIC. The Class LT-R Interest is hereby     
designated as the sole class of residual interest in the Lower-Tier REMIC and   
shall be represented by the Class R Certificates.                               

                                                        [Enlarge/Download Table]


                                                                                            Corresponding  
   Lower-Tier      Lower-Tier                                                              Upper-Tier REMIC
 REMIC Interest   Interest Rate           Initial Lower-Tier Principal Amount              Regular Interest
----------------  -------------  --------------------------------------------------------  ----------------
                                                                                                           
Class LT-A-1          (1)        1/2 initial Class Certificate Balance of Corresponding          A-1       
                                 Upper-Tier Regular Interest                                               
Class LT-A-2          (1)        1/2 initial Class Certificate Balance of Corresponding          A-2       
                                 Upper-Tier Regular Interest                                               
Class LT-A-3          (1)        1/2 initial Class Certificate Balance of Corresponding          A-3       
                                 Upper-Tier Regular Interest                                               
Class LT-A-4          (1)        1/2 initial Class Certificate Balance of Corresponding          A-4       
                                 Upper-Tier Regular Interest                                               
Class LT-M-1          (1)        1/2 initial Class Certificate Balance of Corresponding          M-1       
                                 Upper-Tier Regular Interest                                               
Class LT-M-2          (1)        1/2 initial Class Certificate Balance of Corresponding          M-2       
                                 Upper-Tier Regular Interest                                               
Class LT-M-3          (1)        1/2 initial Class Certificate Balance of Corresponding          M-3       
                                 Upper-Tier Regular Interest                                               
Class LT-M-4          (1)        1/2 initial Class Certificate Balance of Corresponding          M-4       
                                 Upper-Tier Regular Interest                                               
Class LT-M-5          (1)        1/2 initial Class Certificate Balance of Corresponding          M-5       
                                 Upper-Tier Regular Interest                                               
Class LT-M-6          (1)        1/2 initial Class Certificate Balance of Corresponding          M-6       
                                 Upper-Tier Regular Interest                                               
Class LT-B-1          (1)        1/2 initial Class Certificate Balance of Corresponding          B-1       
                                 Upper-Tier Regular Interest                                               
Class LT-B-2          (1)        1/2 initial Class Certificate Balance of Corresponding          B-2       
                                 Upper-Tier Regular Interest                                               
Class LT-B-3          (1)        1/2 initial Class Certificate Balance of Corresponding          B-3       
                                 Upper-Tier Regular Interest                                               
Class LT-Accrual      (1)        1/2 Pool Stated Principal Balance plus 1/2 Subordinated         N/A       
                                 Amount                                                                    
Class LT-IO           (2)        (2)                                                             N/A       

Class LT-R            (3)        (3)                                                             N/A       


----------                                                                      

(1)   The interest rate with respect to any Distribution Date for these         
   interests is a per annum variable rate equal to the weighted average of
the Pooling-Tier REMIC-2 Interest Rates of the Pooling-Tier REMIC-2 
 Regular Interests (other than the Pooling-Tier REMIC-2 IO Interests).

(2)   This Lower-Tier Regular Interest is an interest-only interest and does not
have a Lower-Tier Principal Amount. On each Distribution Date, this 
 Lower-Tier Regular Interest shall be entitled to receive all interest
distributable on the Pooling-Tier REMIC-2 IO Interests.             

(3)   The Class LT-R Interest is the sole class of residual interest in the     
   Lower-Tier REMIC and it does not have a principal amount or an interest
rate.                                                               

          Each Lower-Tier Regular Interest is hereby designated as a regular
interest in the Lower-Tier REMIC. The Class LT-A-1, Class LT-A-2, Class LT-A-3, 
Class LT-A-4, Class LT-M-1, Class LT-M-2, Class LT-M-3, Class LT-M-4, Class     
LT-M-5, Class LT-M-6, Class LT-B-1, Class LT-B-2 and Class LT-B-3 Interests are 
hereby designated the LT-Accretion Directed Classes (the "LT-Accretion Directed 
Classes").                                                                      

          On each Distribution Date, 50% of the increase in the Subordinated
Amount shall be payable as a reduction of the Lower Tier Principal Amount of the
LT-Accretion Directed Classes (each such Class will be reduced by an amount     
equal to 50% of any increase in the Subordinated Amount that is attributable to 
a reduction in the Class Certificate Balance of its Corresponding Class) and    
shall be accrued and added to the Lower Tier Principal Amount of the Class      
LT-Accrual Interest. On each Distribution Date, the increase in the Lower Tier  
Principal Amount of the Class LT-Accrual Interest shall not exceed interest     
accruals for such Distribution Date for the Class LT-Accrual Interest. In the   
event that: (i) 50% of the increase in the Subordinated Amount exceeds (ii)     
interest accruals on the Class LT-Accrual Interest for such Distribution Date,  
the excess for such Distribution Date (accumulated with all such excesses for   
all prior Distribution Dates) will be added to any increase in the Subordinated 
Amount for purposes of determining the amount of interest accrual on the Class  
LT-Accrual Interest payable as principal on the LT-Accretion Directed Classes on
the next Distribution Date pursuant to the first sentence of this paragraph. All
payments of scheduled principal and prepayments of principal generated by the   
Mortgage Loans and all Subsequent Recoveries allocable to principal shall be    
allocated (i) 50% to the Class LT-Accrual Interest and (ii) 50% to the          
LT-Accretion Directed Classes (such principal payments and Subsequent Recoveries
shall be allocated among such LT Accretion Directed Classes in an amount equal  
to 50% of the principal amounts and Subsequent Recoveries allocated to their    
respective Corresponding Classes), until paid in full. Notwithstanding the      
above, principal payments allocated to the Class X Interest that result in the  
reduction in the Subordinated Amount shall be allocated to the Class LT-Accrual 
Interest (until paid in full). Realized Losses shall be applied so that after   
all distributions have been made on each Distribution Date (i) the Lower Tier   
Principal Amount of each LT-Accretion Directed Class is equal to 50% of the     
Class Certificate Balance of its Corresponding Class, and (ii) the Class        
LT-Accrual Interest is equal to 50% of the aggregate Stated Principal Balance of
the Mortgage Loans plus 50% of the Subordinated Amount. Any increase in the     
Class Certificate Balance of a Class of Offered Certificates as a result of a   
Subsequent Recovery shall increase the Lower Tier Principal Amount of the       
Corresponding Lower Tier Regular Interest by 50% of such increase and the       
remaining 50% of such increase shall increase the Lower Tier Principal Amount of
the Class LT-Accrual Interest.                                                  

Upper Tier REMIC

          The Upper-Tier REMIC shall issue the following interests, and each
such interest, other than the Class UT-R Interest, is hereby designated as a    
regular interest in the Upper-Tier REMIC. The Class UT-R Interest is hereby     
designated as the sole class of residual interests in the Upper-Tier REMIC and  
shall be represented by the Class R Certificates.                               

Upper-Tier       Upper-Tier      Initial Principal      Corresponding Class of
REMIC Interest   Interest Rate    Upper-Tier Amount         Certificates        
--------------   -------------   ---------------------   ---------------------- 
Class A-1           (1)        $         512,080,000        Class A-1       
Class A-2           (1)        $         156,440,000        Class A-2       
Class A-3           (1)        $         217,370,000        Class A-3       
Class A-4           (1)        $         136,726,000        Class A-4       
Class M-1           (1)        $          44,067,000        Class M-1       
Class M-2           (1)        $          40,827,000        Class M-2       
Class M-3           (1)        $          23,977,000        Class M-3       
Class M-4           (1)        $          20,737,000        Class M-4       
Class M-5           (1)        $          20,737,000        Class M-5       
Class M-6           (1)        $          18,793,000        Class M-6       
Class B-1           (1)        $          18,145,000        Class B-1       
Class B-2           (1)        $          16,201,000        Class B-2       
Class B-3           (1)        $          13,609,000        Class B-3       
Class IO            (2)                       (2)           N/A             
Class X             (3)                       (3)           Class X         
Class UT-R          (4)                       (4)           Class R         

----------                                                                      

(1)   For any Distribution Date (and the related Interest Accrual Period) this  
   interest shall bear interest at the lesser of (i) the Pass-Through Rate
     (determined without regard to the WAC Cap) for the Corresponding Class of
Certificates and (ii) the Upper-Tier REMIC WAC Rate.                

(2)   This interest is an interest-only interest and does not have a principal  
balance. On each Distribution Date, the Class IO Interest shall be  
entitled to receive all interest distributable on the Class LT-IO   
     Interest. This interest shall be beneficially owned by the holders of the
   Class X Certificates and shall be held as an asset of the Swap Account.

(3)   The Class X Interest has an initial principal balance of $56,382,575 but  
  will not accrue interest on such balance but will accrue interest on a
notional principal balance. As of any Distribution Date, the Class X
      Interest shall have a notional principal balance equal to the aggregate of
the Lower-Tier Principal Amounts of the Lower-Tier Regular Interests
    (other than the Class LT-IO Interest) as of the first day of the related
     Interest Accrual Period. With respect to any Interest Accrual Period, the
  Class X Interest shall bear interest at a rate equal to the excess, if
    any, of the Upper-Tier REMIC WAC Rate over the product of (i) 2 and (ii)
   the weighted average of the Lower-Tier Interest Rates of the Lower-Tier
REMIC Interests (other than the Class LT-IO Interest), where the    
 Lower-Tier Interest Rate on each of the Class LT-Accrual Interest, is
  subject to a cap equal to zero and each LT-Accretion Directed Class is
subject to a cap equal to the Upper-Tier Interest Rate on its       
   Corresponding Class of Upper-Tier Regular Interest. With respect to any
 Distribution Date, interest that so accrues on the notional principal
   balance of the Class X Interest shall be deferred in an amount equal to
   any increase in the Subordinated Amount on such Distribution Date. Such
deferred interest shall not itself bear interest.                   

(4)   The Class UT-R Interest does not have an interest rate or a principal     
balance.                                                            

           On each Distribution Date, interest distributable in respect of the
Lower-Tier Interests for such Distribution Date shall be deemed to be           
distributed on the interests in the Upper-Tier REMIC at the rates shown above,  
provided that the Class IO Interest shall be entitled to receive interest before
any other interest in the Upper-Tier REMIC.                                     

  On each Distribution Date, all Realized Losses, Subsequent
Recoveries and all payments of principal shall be allocated to the Upper-Tier   
Interests until the outstanding principal balance of each such interest equals  
the outstanding Class Certificate Balance of the Corresponding Class of         
Certificates as of such Distribution Date.                                      

The Certificates

Class Designation   Class Pass-Through Rate   Class Certificate Balance         
-----------------   -----------------------   -------------------------         
Class A-1                     (1)             $           512,080,000           
Class A-2                     (1)             $           156,440,000           
Class A-3                     (1)             $           217,370,000           
Class A-4                     (1)             $           136,726,000           
Class M-1                     (2)             $            44,067,000           
Class M-2                     (2)             $            40,827,000           
Class M-3                     (2)             $            23,977,000           
Class M-4                     (2)             $            20,737,000           
Class M-5                     (2)             $            20,737,000           
Class M-6                     (2)             $            18,793,000           
Class B-1                     (2)             $            18,145,000           
Class B-2                     (2)             $            16,201,000           
Class B-3                     (2)             $            13,609,000           
Class X                       (3)                             (3)               
Class R                       (4)                             (4)               

----------                                                                      

(1)   The Class A-1, Class A-2, Class A-3 and Class A-4 Interest will bear      
     interest during each Interest Accrual Period at a per annum rate equal to
    (a) on or prior to the Optional Termination Date, the least of (i) LIBOR
      plus 0.0800%, 0.1400%, 0.1900% and 0.3000%, respectively, and (ii) the WAC
  Cap or (b) after the Optional Termination Date, the least of (i) LIBOR
      plus 0.1600%, 0.2800%, 0.3800% and 0.6000%, respectively, and (ii) the WAC
Cap.                                                                

(2)   The Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6,     
  Class B-1, Class B-2 and Class B-3 Interests will bear interest during
     each Interest Accrual Period at a per annum rate equal to (a) on or prior
   to the Optional Termination Date, the lesser of (i) LIBOR plus 0.3800%,
      0.4000%, 0.4200%, 0.5200%, 0.5500%, 0.6600%, 1.2500%, 1.4500% and 2.2000%,
    respectively, and (ii) the WAC Cap or (b) after the Optional Termination
  Date, the lesser of (i) LIBOR plus 0.5700%, 0.6000%, 0.6300%, 0.7800%,
     0.8250%, 0.9900%, 1.8750%, 2.1750% and 3.3000% respectively, and (ii) the
WAC Cap.                                                            

(3)   The Class X Certificates will represent beneficial ownership of the Class 
    X Interest, the Class IO Interest, the Interest Rate Swap Agreement, the
right to Class IO Shortfalls and amounts in the Excess Reserve Fund 
    Account and the Swap Account, subject to the obligation to make payments
      from the Excess Reserve Fund Account in respect of Basis Risk CarryForward
     Amounts and amounts in the Swap Account subject to the obligation to make
    Net Swap Payments, Swap Termination Payments and Basis Risk CarryForward
      Amounts. For federal income tax purposes, the Trustee will treat a Class X
   Certificateholder's obligation to make payments from the Excess Reserve
     Fund Account or the Swap Account as payments made pursuant to an interest
   rate cap contract written by the Class X Certificateholders in favor of
each Class of LIBOR Certificates. Such rights of the Class X        
    Certificateholders and LIBOR Certificateholders shall be treated as held
   in a portion of the Trust Fund that is treated as a grantor trust under
subpart E, Part I of subchapter J of the Code.                      

(4)   The Class R Certificates do not have an interest rate or a principal      
balance.                                                            

           The minimum denomination for each Class of Certificates, other than
the Class P, Class R and the Class X Certificates, will be $25,000 with integral
multiples of $1 in excess thereof. The minimum denomination for the Class P and 
the Class X Certificates will each be a 1% Percentage Interest in such Class.   
The Class R Certificate will represent a 100% Percentage Interest in such Class.

       It is expected that each Class of Certificates will receive its
final distribution of principal and interest on or prior to the Final Scheduled 
Distribution Date.                                                              

          Set forth below are designations of Classes of Certificates to the
categories used herein:                                                         

Book-Entry Certificates...........  All Classes of Certificates other than the  
              Physical Certificates.

Class A Certificates..............  Class A-1, Class A-2, Class A-3 and Class   
A-4.    

Delay Certificates................  None.                                       

ERISA-Restricted                                                                
 Certificates...................  Class R Certificates, Class P Certificates
                                 and Class X Certificates; any certificate
                                 with a rating below the lowest applicable
                                permitted rating under the Underwriters'
  Exemption.

Non-Delay Certificates............  Class A, Class X and Subordinated           
     Certificates.

Offered Certificates..............  All Classes of Certificates other than the  
             Private Certificates.

Physical Certificates.............  Class P, Class X and Class R Certificates.  

Private Certificates..............  Class P, Class X and Class R Certificates.  

Rating Agencies...................  Moody's, Fitch and Standard & Poor's.       

Regular Certificates..............  All Classes of Certificates other than the  
                         Class P and Class R Certificates.

Residual Certificates.............  Class R Certificates.                       

Subordinated Certificates.........  Class M-1, Class M-2, Class M-3, Class M-4, 
                                  Class M-5, Class M-6, Class B-1, Class B-2
                   and Class B-3 Certificates.

 ARTICLE I

 DEFINITIONS

         Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:       

        Accepted Servicing Practices: With respect to any Mortgage Loan,
those mortgage servicing practices set forth in Section 3.01(a) of this         
Agreement.                                                                      

          Account: Any of the Collection Accounts, the Distribution Account,
any Escrow Account, the Excess Reserve Fund Account or the Swap Account. Each   
Account shall be an Eligible Account.                                           

         Accrued Certificate Interest Distribution Amount: With respect to
any Distribution Date for each Class of Offered Certificates, the amount of     
interest accrued during the related Interest Accrual Period at the applicable   
Pass-Through Rate on the related Class Certificate Balance immediately prior to 
such Distribution Date, as reduced by such Class's share of Net Prepayment      
Interest Shortfalls and Relief Act Interest Shortfalls for such Distribution    
Date allocated to such Class pursuant to Section 4.02.                          

        Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan.

       Adjusted Net Mortgage Rate: As to each Mortgage Loan and at any
time, the per annum rate equal to the Mortgage Rate less the Expense Fee Rate.  

           Adjustment Date: As to any Adjustable Rate Mortgage Loan, the first
Due Date on which the related Mortgage Rate adjusts as set forth in the related 
Mortgage Note and each Due Date thereafter on which the Mortgage Rate adjusts as
set forth in the related Mortgage Note.                                         

Advance: Any P&I Advance or Servicing Advance.          

       Advance Facility: A financing or other facility as described in
Section 10.07.                                                                  

        Advancing Person: The Person to whom any Servicer's rights under
this Agreement to be reimbursed for any P&I Advances or Servicing Advances have 
been assigned pursuant to Section 10.07.                                        

            Affiliate: With respect to any Person, any other Person controlling,
controlled by or under common control with such first Person. For the purposes  
of this definition, "control" means the power to direct the management and      
policies of such Person, directly or indirectly, whether through the ownership  
of voting securities, by contract or otherwise; and the terms "controlling" and 
"controlled" have meanings correlative to the foregoing.                        

          Agreement: This Pooling and Servicing Agreement and all amendments
or supplements hereto.                                                          

          Amount Held for Future Distribution: As to the Certificates on any
Distribution Date, the aggregate amount held in each Collection Account at the  
close of business on the related Determination Date on account of (i) Principal 
Prepayments, Insurance Proceeds, Condemnation Proceeds and Liquidation Proceeds 
on the Mortgage Loans received after the end of the related Prepayment Period   
and (ii) all Scheduled Payments on the Mortgage Loans due after the end of the  
related Due Period.                                                             

   Analytics Company: Intex Solutions, Inc., or any other bond
analytics service provider identified to the Trustee by the Depositor.          

            Applied Realized Loss Amount: With respect to any Distribution Date,
the amount, if any, by which the aggregate Class Certificate Balance of the     
Offered Certificates after distributions of principal on such Distribution Date 
exceeds the aggregate Stated Principal Balance of the Mortgage Loans for such   
Distribution Date.                                                              

    Appraised Value: The value set forth in an appraisal made in
connection with the origination of the related Mortgage Loan as the value of the
Mortgaged Property.                                                             

        Assignment of Mortgage: An assignment of the Mortgage, notice of
transfer or equivalent instrument in recordable form (other than the assignee's 
name and recording information not yet returned from the recording office),     
reflecting the sale of the Mortgage to the Trustee.                             

      Available Funds: With respect to any Distribution Date and the
Mortgage Loans to the extent received by the Trustee (x) the sum of (i) all     
scheduled installments of interest (net of the related Expense Fees) and        
principal due on the Due Date on such Mortgage Loans in the related Due Period  
and received by the Servicers on or prior to the related Determination Date,    
together with any P&I Advances in respect thereof; (ii) all Condemnation        
Proceeds, Insurance Proceeds and Liquidation Proceeds received by the Servicers 
during the related Prepayment Period (in each case, net of unreimbursed expenses
incurred in connection with a liquidation or foreclosure and unreimbursed       
Advances, if any); (iii) all partial or full prepayments on the Mortgage Loans  
received by the Servicers during the related Prepayment Period together with all
Compensating Interest, if applicable, thereon (excluding any Prepayment         
Charges); (iv) all Substitution Adjustment Amounts with respect to the          
substitutions of Mortgage Loans that occur with respect to such Distribution    
Date; (v) amounts received with respect to such Distribution Date as the        
Repurchase Price in respect of a Mortgage Loan repurchased by the Responsible   
Party with respect to such Distribution Date; (vi) the proceeds received with   
respect to the termination of the Trust Fund pursuant to clause (a) of Section  
9.01; and (vii) the Closing Date Deposit Amount; reduced by (y) amounts in      
reimbursement for Advances previously made with respect to the Mortgage Loans   
and other amounts as to which the Servicers, the Depositor or the Trustee are   
entitled to be paid or reimbursed pursuant to this Agreement.                   

      Balloon Loan: Any Mortgage Loan that requires only payments of
interest until the stated maturity date of the Mortgage Loan or Scheduled       
Payments of principal which (not including the payment due on its stated        
maturity date) are based on an amortization schedule that would be insufficient 
to fully amortize the principal thereof by the stated maturity date of the      
Mortgage Loan.                                                                  

Basic Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the Principal Remittance Amount for such   
Distribution Date over (ii) the Excess Subordinated Amount, if any, for such    
Distribution Date.                                                              

     Basis Risk CarryForward Amount: With respect to each Class of
Offered Certificates, as of any Distribution Date, the sum of (A) if on such    
Distribution Date the Pass-Through Rate for any Class of Offered Certificates is
based upon the WAC Cap, the excess of (i) the Accrued Certificate Interest      
Distribution Amount such Class of Certificates would otherwise be entitled to   
receive on such Distribution Date had such Pass-Through Rate not been subject to
any WAC Cap (that is, had such rate been calculated as the sum of LIBOR and the 
applicable Pass-Through Margin on such Class of Certificates for such           
Distribution Date and the resulting amount being reduced by allocated Net       
Prepayment Interest Shortfalls and Relief Act Interest Shortfalls) over (ii) the
Accrued Certificate Interest Distribution Amount received on such Distribution  
Date such Class of Certificates at, with respect to each Class of Offered       
Certificates, the WAC Cap for such Distribution Date and (B) the Basis Risk     
CarryForward Amount for such Class of Certificates for all previous             
Distribution Dates not previously paid, together with interest thereon at a rate
equal to the sum of LIBOR and the applicable Pass-Through Margin for such Class 
of Certificates for such Distribution Date.                                     

         Basis Risk Payment: For any Distribution Date, an amount equal to
the lesser of (i) the aggregate of the Basis Risk CarryForward Amounts for such 
Distribution Date and (ii) the Class X Distributable Amount (prior to any       
reduction for amounts paid from the Excess Reserve Fund Account to pay any Basis
Risk CarryForward Amount or any Swap Termination Payment).                      

          Best's: Best's Key Rating Guide, as the same shall be amended from
time to time.                                                                   

           Book-Entry Certificates: As specified in the Preliminary Statement.

          Business Day: Any day other than (i) Saturday or Sunday, or (ii) a
day on which banking and savings and loan institutions, in (a) the States of New
York, California, New Jersey, Texas, Arizona or Delaware, (b) a State in which  
any Servicer's servicing operations are located, or (c) the State in which the  
Trustee's operations are located, are authorized or obligated by law or         
executive order to be closed.                                                   

           Certificate: Any one of the Certificates executed by the Trustee in
substantially the forms attached hereto as exhibits.                            

       Certificate Balance: With respect to any Class of Certificates,
other than the Class X, Class P or Class R Certificates, at any date, the       
maximum dollar amount of principal to which the Holder thereof is then entitled 
hereunder, such amount being equal to the Denomination thereof minus all        
distributions of principal previously made with respect thereto and in the case 
of any Certificates, reduced by any Applied Realized Loss Amounts allocated to  
such Class of Certificates pursuant to Section 4.05; provided, however, that    
immediately following the Distribution Date on which a Subsequent Recovery is   
distributed, the Class Certificate Balances of any Class or Classes of          
Certificates that have been previously reduced by Applied Realized Loss Amounts 
will be increased, in order of seniority, by the amount of the Subsequent       
Recovery distributed on such Distribution Date (up to the amount of the Unpaid  
Realized Loss Amount for such Class or Classes for such Distribution Date). The 
Class X, Class P and Class R Certificates have no Certificate Balance.          

        Certificate Owner: With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Book-Entry Certificate.              

         Certificate Register: The register maintained pursuant to Section
5.02.                                                                           

           Certificateholder or Holder: The person in whose name a Certificate
is registered in the Certificate Register, except that, solely for the purpose  
of giving any consent pursuant to this Agreement, any Certificate registered in 
the name of the Depositor or any Affiliate of the Depositor shall be deemed not 
to be Outstanding and the Percentage Interest evidenced thereby shall not be    
taken into account in determining whether the requisite amount of Percentage    
Interests necessary to effect such consent has been obtained; provided, however,
that if any such Person (including the Depositor) owns 100% of the Percentage   
Interests evidenced by a Class of Certificates, such Certificates shall be      
deemed to be Outstanding for purposes of any provision hereof that requires the 
consent of the Holders of Certificates of a particular Class as a condition to  
the taking of any action hereunder. The Trustee is entitled to rely conclusively
on a certification of the Depositor or any Affiliate of the Depositor in        
determining which Certificates are registered in the name of an Affiliate of the
Depositor.                                                                      

         Class: All Certificates bearing the same class designation as set
forth in the Preliminary Statement.                                             

        Class A Certificates: As specified in the Preliminary Statement.

  Class A Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the aggregate Class Certificate Balances of
the Class A Certificates immediately prior to such Distribution Date over (ii)  
the lesser of (A) 57.80% of the aggregate Stated Principal Balance of the       
Mortgage Loans for such Distribution Date and (B) the excess, if any, of the    
aggregate Stated Principal Balance of the Mortgage Loans for such Distribution  
Date over $6,480,458.                                                           

  Class A-1 Certificates: All Certificates bearing the class
designation of "Class A-1".                                                     

  Class A-2 Certificates: All Certificates bearing the class
designation of "Class A-2".                                                     

  Class A-3 Certificates: All Certificates bearing the class
designation of "Class A-3".                                                     

  Class A-4 Certificates: All Certificates bearing the class
designation of "Class A-4".                                                     

    Class B Certificates: The Class B-1, Class B-2 and Class B-3
Certificates.                                                                   

  Class B-1 Certificates: All Certificates bearing the class
designation of "Class B-1".                                                     

    Class B-1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class         
Certificate Balances of the Class A Certificates (after taking into account the 
distribution of the Class A Principal Distribution Amount for such Distribution 
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after   
taking into account the distribution of the Class M-1 Principal Distribution    
Amount for such Distribution Date), (C) the Class Certificate Balance of the    
Class M-2 Certificates (after taking into account the distribution of the Class 
M-2 Principal Distribution Amount for such Distribution Date), (D) the Class    
Certificate Balance of the Class M-3 Certificates (after taking into account the
distribution of the Class M-3 Principal Distribution Amount for such            
Distribution Date), (E) the Class Certificate Balance of the Class M-4          
Certificates (after taking into account the distribution of the Class M-4       
Principal Distribution Amount for such Distribution Date), (F) the Class        
Certificate Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount for such            
Distribution Date), (G) the Class Certificate Balance of the Class M-6          
Certificates (after taking into account the distribution of the Class M-6       
Principal Distribution Amount for such Distribution Date) and (H) the Class     
Certificate Balance of the Class B-1 Certificates immediately prior to such     
Distribution Date over (ii) the lesser of (A) 86.70% of the aggregate Stated    
Principal Balance of the Mortgage Loans for such Distribution Date and (B) the  
excess, if any, of the aggregate Stated Principal Balance of the Mortgage Loans 
for such Distribution Date over $6,480,458.                                     

  Class B-2 Certificates: All Certificates bearing the class
designation of "Class B-2".                                                     

    Class B-2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class         
Certificate Balances of the Class A Certificates (after taking into account the 
distribution of the Class A Principal Distribution Amount for such Distribution 
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after   
taking into account the distribution of the Class M-1 Principal Distribution    
Amount for such Distribution Date), (C) the Class Certificate Balance of the    
Class M-2 Certificates (after taking into account the distribution of the Class 
M-2 Principal Distribution Amount for such Distribution Date), (D) the Class    
Certificate Balance of the Class M-3 Certificates (after taking into account the
distribution of the Class M-3 Principal Distribution Amount for such            
Distribution Date), (E) the Class Certificate Balance of the Class M-4          
Certificates (after taking into account the distribution of the Class M-4       
Principal Distribution Amount for such Distribution Date), (F) the Class        
Certificate Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount for such            
Distribution Date), (G) the Class Certificate Balance of the Class M-6          
Certificates (after taking into account the distribution of the Class M-6       
Principal Distribution Amount for such Distribution Date), (H) the Class        
Certificate Balance of the Class B-1 Certificates (after taking into account the
distribution of the Class B-1 Principal Distribution Amount for such            
Distribution Date) and (I) the Class Certificate Balance of the Class B-2       
Certificates immediately prior to such Distribution Date over (ii) the lesser of
(A) 89.20% of the aggregate Stated Principal Balance of the Mortgage Loans for  
such Distribution Date and (B) the excess, if any, of the aggregate Stated      
Principal Balance of the Mortgage Loans for such Distribution Date over         
$6,480,458.                                                                     

  Class B-3 Certificates: All Certificates bearing the class
designation of "Class B-3".                                                     

    Class B-3 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class         
Certificate Balances of the Class A Certificates (after taking into account the 
distribution of the Class A Principal Distribution Amount for such Distribution 
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after   
taking into account the distribution of the Class M-1 Principal Distribution    
Amount for such Distribution Date), (C) the Class Certificate Balance of the    
Class M-2 Certificates (after taking into account the distribution of the Class 
M-2 Principal Distribution Amount for such Distribution Date), (D) the Class    
Certificate Balance of the Class M-3 Certificates (after taking into account the
distribution of the Class M-3 Principal Distribution Amount for such            
Distribution Date), (E) the Class Certificate Balance of the Class M-4          
Certificates (after taking into account the distribution of the Class M-4       
Principal Distribution Amount for such Distribution Date), (F) the Class        
Certificate Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount for such            
Distribution Date), (G) the Class Certificate Balance of the Class M-6          
Certificates (after taking into account the distribution of the Class M-6       
Principal Distribution Amount for such Distribution Date), (H) the Class        
Certificate Balance of the Class B-1 Certificates (after taking into account the
distribution of the Class B-1 Principal Distribution Amount for such            
Distribution Date), (I) the Class Certificate Balance of the Class B-2          
Certificates (after taking into account the distribution of the Class B-2       
Principal Distribution Amount for such Distribution Date) and (J) the Class     
Certificate Balance of the Class B-3 Certificates immediately prior to such     
Distribution Date over (ii) the lesser of (A) 91.30% of the aggregate Stated    
Principal Balance of the Mortgage Loans for such Distribution Date and (B) the  
excess, if any, of the aggregate Stated Principal Balance of the Mortgage Loans 
for such Distribution Date over $6,480,458.                                     

          Class Certificate Balance: With respect to any Class and as to any
date of determination, the aggregate of the Certificate Balances of all         
Certificates of such Class as of such date.                                     

     Class IO Interest: As specified in the Preliminary Statement.

          Class IO Shortfalls: As defined in Section 8.13. For the avoidance
of doubt, the Class IO Shortfall for any Distribution Date shall equal the      
amount payable to the Class X Certificates in respect of amounts due to the Swap
Provider on such Distribution Date (other than Defaulted Swap Termination       
Payments) in excess of the amount payable on the Class X Interest (prior to any 
reduction for Basis Risk Payments or Swap Termination Payments) on such         
Distribution Date, all as further provided in Section 8.13.                     

          Class LT-R Interest: The residual interest in the Lower-Tier REMIC
as described in the Preliminary Statement and the related footnote thereto.     

        Class M Certificates: The Class M-1, Class M-2, Class M-3, Class
M-4, Class M-5 and Class M-6 Certificates.                                      

          Class M-1 Enhancement Percentage: With respect to any Distribution
Date, the percentage obtained by dividing (x) the sum of (i) the aggregate Class
Certificate Balances of the Class M and Class B Certificates (other than the    
Class M-1 Certificates) and (ii) the Subordinated Amount, in each case after    
taking into account the distributions of the related Principal Distribution     
Amount and any principal payments on those Classes of Certificates from the Swap
Account on that Distribution Date, by (y) the aggregate Stated Principal Balance
of the Mortgage Loans for that Distribution Date.                               

  Class M-1 Certificates: All Certificates bearing the class
designation of "Class M-1".                                                     

    Class M-1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class         
Certificate Balances of the Class A Certificates (after taking into account the 
distribution of the Class A Principal Distribution Amount for such Distribution 
Date), and (B) the Class Certificate Balance of the Class M-1 Certificates      
immediately prior to such Distribution Date over (ii) the lesser of (A) 64.60%  
of the aggregate Stated Principal Balance of the Mortgage Loans for such        
Distribution Date and (B) the excess, if any, of the aggregate Stated Principal 
Balance of the Mortgage Loans for such Distribution Date over $6,480,458.       

  Class M-2 Certificates: All Certificates bearing the class
designation of "Class M-2".                                                     

    Class M-2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class         
Certificate Balances of the Class A Certificates (after taking into account the 
distribution of the Class A Principal Distribution Amount for such Distribution 
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after   
taking into account the distribution of the Class M-1 Principal Distribution    
Amount for such Distribution Date) and (C) the Class Certificate Balance of the 
Class M-2 Certificates immediately prior to such Distribution Date over (ii) the
lesser of (A) 70.90% of the aggregate Stated Principal Balance of the Mortgage  
Loans for such Distribution Date and (B) the excess, if any, of the aggregate   
Stated Principal Balance of the Mortgage Loans for such Distribution Date over  
$6,480,458.                                                                     

  Class M-3 Certificates: All Certificates bearing the class
designation of "Class M-3".                                                     

    Class M-3 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class         
Certificate Balances of the Class A Certificates (after taking into account the 
distribution of the Class A Principal Distribution Amount for such Distribution 
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after   
taking into account the distribution of the Class M-1 Principal Distribution    
Amount for such Distribution Date), (C) the Class Certificate Balance of the    
Class M-2 Certificates (after taking into account the distribution of the Class 
M-2 Principal Distribution Amount for such Distribution Date) and (D) the Class 
Certificate Balance of the Class M-3 Certificates immediately prior to such     
Distribution Date over (ii) the lesser of (A) 74.60% of the aggregate Stated    
Principal Balance of the Mortgage Loans for such Distribution Date and (B) the  
excess, if any, of the aggregate Stated Principal Balance of the Mortgage Loans 
for such Distribution Date over $6,480,458.                                     

  Class M-4 Certificates: All Certificates bearing the class
designation of "Class M-4".                                                     

    Class M-4 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class         
Certificate Balances of the Class A Certificates (after taking into account the 
distribution of the Class A Principal Distribution Amount for such Distribution 
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after   
taking into account the distribution of the Class M-1 Principal Distribution    
Amount for such Distribution Date), (C) the Class Certificate Balance of the    
Class M-2 Certificates (after taking into account the distribution of the Class 
M-2 Principal Distribution Amount for such Distribution Date), (D) the Class    
Certificate Balance of the Class M-3 Certificates (after taking into account the
distribution of the Class M-3 Principal Distribution Amount for such            
Distribution Date) and (E) the Class Certificate Balance of the Class M-4       
Certificates immediately prior to such Distribution Date over (ii) the lesser of
(A) 77.80% of the aggregate Stated Principal Balance of the Mortgage Loans for  
such Distribution Date and (B) the excess, if any, of the aggregate Stated      
Principal Balance of the Mortgage Loans for such Distribution Date over         
$6,480,458.                                                                     

  Class M-5 Certificates: All Certificates bearing the class
designation of "Class M-5".                                                     

    Class M-5 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class         
Certificate Balances of the Class A Certificates (after taking into account the 
distribution of the Class A Principal Distribution Amount for such Distribution 
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after   
taking into account the distribution of the Class M-1 Principal Distribution    
Amount for such Distribution Date), (C) the Class Certificate Balance of the    
Class M-2 Certificates (after taking into account the distribution of the Class 
M-2 Principal Distribution Amount for such Distribution Date), (D) the Class    
Certificate Balance of the Class M-3 Certificates (after taking into account the
distribution of the Class M-3 Principal Distribution Amount for such            
Distribution Date), (E) the Class Certificate Balance of the Class M-4          
Certificates (after taking into account the distribution of the Class M-4       
Principal Distribution Amount for such Distribution Date) and (F) the Class     
Certificate Balance of the Class M-5 Certificates immediately prior to such     
Distribution Date over (ii) the lesser of (A) 81.00 % of the aggregate Stated   
Principal Balance of the Mortgage Loans for such Distribution Date and (B) the  
excess, if any, of the aggregate Stated Principal Balance of the Mortgage Loans 
for such Distribution Date over $6,480,458.                                     

  Class M-6 Certificates: All Certificates bearing the class
designation of "Class M-6".                                                     

    Class M-6 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class         
Certificate Balances of the Class A Certificates (after taking into account the 
distribution of the Class A Principal Distribution Amount for such Distribution 
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after   
taking into account the distribution of the Class M-1 Principal Distribution    
Amount for such Distribution Date), (C) the Class Certificate Balance of the    
Class M-2 Certificates (after taking into account the distribution of the Class 
M-2 Principal Distribution Amount for such Distribution Date), (D) the Class    
Certificate Balance of the Class M-3 Certificates (after taking into account the
distribution of the Class M-3 Principal Distribution Amount for such            
Distribution Date), (E) the Class Certificate Balance of the Class M-4          
Certificates (after taking into account the distribution of the Class M-4       
Principal Distribution Amount for such Distribution Date), (F) the Class        
Certificate Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount for such            
Distribution Date) and (G) the Class Certificate Balance of the Class M-6       
Certificates immediately prior to such Distribution Date over (ii) the lesser of
(A) 83.90% of the aggregate Stated Principal Balance of the Mortgage Loans for  
such Distribution Date and (B) the excess, if any, of the aggregate Stated      
Principal Balance of the Mortgage Loans for such Distribution Date over         
$6,480,458.                                                                     

            Class P Certificates: All Certificates bearing the class designation
of "Class P".                                                                   

           Class PT1-R Interest: The residual interest in Pooling-Tier REMIC-1
as described in the Preliminary Statement and the related footnote thereto.     

           Class PT2-R Interest: The residual interest in Pooling-Tier REMIC-2
as described in the Preliminary Statement and the related footnote thereto.     

            Class R Certificates: All Certificates bearing the class designation
of "Class R".                                                                   

          Class UT-R Interest: The residual interest in the Upper-Tier REMIC
as described in the Preliminary Statement and the related footnote thereto.     

            Class X Certificates: All Certificates bearing the class designation
of "Class X".                                                                   

          Class X Distributable Amount: On any Distribution Date, the sum of
(i) as a distribution in respect of interest, the amount of interest that has   
accrued on the Class X Interest and not applied as an Extra Principal           
Distribution Amount on such Distribution Date, plus any such accrued interest   
remaining undistributed from prior Distribution Dates, plus, without duplication
(ii) as a distribution in respect of principal, any portion of the principal    
balance of the Class X Interest which is distributable as a Subordination       
Reduction Amount, minus (iii) any amounts paid from the Excess Reserve Fund     
Account to pay any Basis Risk CarryForward Amount or any Swap Termination       
Payment.                                                                        

            Class X Interest: The Upper Tier Regular Interest represented by the
Class X Certificates as specified and described in the Preliminary Statement and
the related footnote thereto.                                                   

Closing Date: January 27, 2006.                         

          Closing Date Deposit Amount: $574.38 (all of which is allocable to
principal) deposited by the Depositor into the Distribution Account on the      
Closing Date.                                                                   

           Code: The Internal Revenue Code of 1986, including any successor or
amendatory provisions.                                                          

Collection Account: As defined in Section 3.10(a).      

          Combined Loan to Value Ratio or CLTV: As of any date and as to any
Second Lien Mortgage Loan, the ratio, expressed as a percentage, of the (a) sum 
of (i) the outstanding principal balance of the Second Lien Mortgage Loan and   
(ii) the outstanding principal balance as of such date of any mortgage loan or  
mortgage loans that are senior or equal in priority to the Second Lien Mortgage 
Loan and which are secured by the same Mortgaged Property to (b) the Appraised  
Value as determined pursuant to the Underwriting Guidelines of the related      
Mortgaged Property as of the origination of the Second Lien Mortgage Loan.      

         Commission: The United States Securities and Exchange Commission.

           Compensating Interest: For any Distribution Date, the lesser of (a)
the amount by which such Prepayment Interest Shortfall exceeds all Prepayment   
Interest Excesses for such Distribution Date on the Mortgage Loans serviced by  
the applicable Servicer and (b) the amount of the aggregate Servicing Fee paid  
to or retained by the applicable Servicer for such Distribution Date.           

        Condemnation Proceeds: All awards of settlements in respect of a
Mortgaged Property, whether permanent or temporary, partial or entire, by       
exercise of the power of eminent domain or condemnation.                        

          Convertible Mortgage Loan: Any individual Adjustable Rate Mortgage
Loan which contains a provision whereby the Mortgagor is permitted to convert   
the Adjustable Rate Mortgage Loan to a Fixed Rate Mortgage Loan in accordance   
with the terms of the related Mortgage Note.                                    

           Corporate Trust Office: The designated office of the Trustee in the
State of California at which at any particular time its corporate trust business
with respect to this Agreement is administered, which office at the date of the 
execution of this Agreement is located at 1761 East St. Andrew Place, Santa Ana,
California 92705, Attn: Trust Administration- MS06C1, facsimile no. (714)       
247-6329, and which is the address to which notices to and correspondence with  
the Trustee should be directed.                                                 

           Corresponding Class: The class of interests in the Lower-Tier REMIC
or Upper-Tier REMIC that corresponds to the class of interests in the other such
REMIC or to a Class of Certificates in the manner set out below:                

Corresponding Lower-Tier   Corresponding Upper-Tier   Corresponding Class       
Class Designation          Regular Interest          of Certificates      
------------------------   ------------------------   -------------------       
Class LT-A-1                Class A-1                Class A-1        
Class LT-A-2                Class A-2                Class A-2        
Class LT-A-3                Class A-3                Class A-3        
Class LT-A-4                Class A-4                Class A-4        
Class LT-M-1                Class M-1                Class M-1        
Class LT-M-2                Class M-2                Class M-2        
Class LT-M-3                Class M-3                Class M-3        
Class LT-M-4                Class M-4                Class M-4        
Class LT-M-5                Class M-5                Class M-5        
Class LT-M-6                Class M-6                Class M-6        
Class LT-B-1                Class B-1                Class B-1        
Class LT-B-2                Class B-2                Class B-2        
Class LT-B-3                Class B-3                Class B-3        
N/A                     Class X                  Class X      

            Corresponding Pooling-Tier REMIC-1 Regular Interest: As described in
the Preliminary Statement.                                                      

           Corresponding Pooling-Tier REMIC-2 IO Interest: As described in the
Preliminary Statement.                                                          

Corresponding Scheduled Crossover Distribution Date: The
Distribution Date in the month and year specified in the Preliminary Statement  
corresponding to a Pooling-Tier REMIC-2 IO Interest.                            

          Cumulative Loss Percentage: With respect to any Distribution Date,
the percentage equivalent of a fraction, the numerator of which is the aggregate
amount of Realized Losses incurred from the Cut-off Date to the last day of the 
calendar month preceding the month in which such Distribution Date occurs and   
the denominator of which is the Cut-off Date Pool Principal Balance of the      
Mortgage Loans.                                                                 

       Cumulative Loss Trigger Event: With respect to any Distribution
Date, a Cumulative Loss Trigger Event exists if the quotient (expressed as a    
percentage) of (x) the aggregate amount of Realized Losses incurred since the   
Cut-off Date through the last day of the related Prepayment Period, divided by  
(y) the Cut-off Date Pool Principal Balance, exceeds the applicable cumulative  
loss percentages set forth below with respect to such Distribution Date:        

Distribution Date Occurring In       Cumulative Loss Percentage                 
------------------------------       --------------------------                 
February 2008 through January 2009   1.350% for the first month, plus an        
                                    additional 1/12th of 1.700% for each month
                                  thereafter (e.g., 2.200% in August 2008)

February 2009 through January 2010   3.050% for the first month, plus an        
                                    additional 1/12th of 1.750% for each month
                                  thereafter (e.g., 3.925% in August 2009)

February 2010 through January 2011   4.800% for the first month, plus an        
                                    additional 1/12th of 1.400% for each month
                                  thereafter (e.g., 5.500% in August 2010)

February 2011 through January 2012   6.200% for the first month, plus an        
                                    additional 1/12th of 0.750% for each month
                                  thereafter (e.g., 6.575% in August 2011)

February 2012 through January 2013   6.950% for the first month, plus an        
                                    additional 1/12th of 0.050% for each month
                                  thereafter (e.g., 6.975% in August 2012)

February 2013 and thereafter         7.000%                                     

    Custodial File: With respect to each Mortgage Loan, the file
retained by the Trustee consisting of items (a)-(h) as listed on Exhibit K      
hereto.                                                                         

Cut-off Date: January 1, 2006.                          

           Cut-off Date Pool Principal Balance: The aggregate Stated Principal
Balances of all Mortgage Loans as of the Cut-off Date plus the portion of the   
Closing Date Deposit Amount allocable to principal.                             

           Cut-off Date Principal Balance: As to any Mortgage Loan, the Stated
Principal Balance thereof as of the close of business on the Cut-off Date (after
giving effect to payments of principal due on that date, whether or not         
received).                                                                      

          Data Tape Information: The information provided by the Responsible
Party as of the Cut-off Date to the Depositor or the Sponsor setting forth the  
following information with respect to each Mortgage Loan: (1) the Mortgagor's   
name; (2) as to each Mortgage Loan, the Scheduled Principal Balance as of the   
Cut-off Date; (3) the Mortgage Rate Cap; (4) the Index; (5) a code indicating   
whether the Mortgaged Property is owner-occupied; (6) the type of Mortgaged     
Property; (7) the first date on which the Scheduled Payment was due on the      
Mortgage Loan and, if such date is not consistent with the Due Date currently in
effect, such Due Date; (8) the "paid through date" based on payments received   
from the related Mortgagor; (9) the original principal amount of the Mortgage   
Loan; (10) with respect to Adjustable Rate Mortgage Loans, the Maximum Mortgage 
Rate; (11) the type of Mortgage Loan (i.e., Fixed Rate or Adjustable Rate       
Mortgage Loan, First Lien Mortgage Loan or Second Lien Mortgage Loan); (12) a   
code indicating the purpose of the loan (i.e., purchase, rate and term          
refinance, equity take-out refinance); (13) a code indicating the documentation 
style (i.e., full, asset verification, income verification and no               
documentation); (14) the credit risk score (FICO score); (15) the loan credit   
grade classification (as described in the underwriting guidelines); (16) with   
respect to each Adjustable Rate Mortgage Loan, the Minimum Mortgage Rate; (17)  
the Mortgage Rate at origination; (18) with respect to each Adjustable Rate     
Mortgage Loan, the first Adjustment Date immediately following the Cut-off Date;
(19) the value of the Mortgaged Property; (20) a code indicating the type of    
Prepayment Charges applicable to such Mortgage Loan (including any prepayment   
penalty term), if any; (21) with respect to each Adjustable Rate Mortgage Loan, 
the Periodic Mortgage Rate Cap; (22) with respect to each First Lien Mortgage   
Loan, the LTV at origination and with respect to each Second Lien Mortgage Loan,
the CLTV at origination; and (23) if such Mortgage Loan is covered by a primary 
mortgage insurance policy or a lender-paid primary mortgage insurance policy,   
the primary mortgage insurance rate. With respect to the Mortgage Loans in the  
aggregate, the Data Tape Information shall set forth the following information, 
as of the Cut-off Date: (1) the number of Mortgage Loans; (2) the current       
aggregate outstanding principal balance of the Mortgage Loans; (3) the weighted 
average Mortgage Rate of the Mortgage Loans; and (4) the weighted average       
maturity of the Mortgage Loans.                                                 

    Debt Service Reduction: With respect to any Mortgage Loan, a
reduction by a court of competent jurisdiction in a proceeding under the United 
States Bankruptcy Code in the Scheduled Payment for such Mortgage Loan which    
became final and non-appealable, except such a reduction resulting from a       
Deficient Valuation or any reduction that results in a permanent forgiveness of 
principal.                                                                      

        Defaulted Swap Termination Payment: Any Swap Termination Payment
required to be paid by the Trust to the Swap Provider pursuant to the Interest  
Rate Swap Agreement as a result of an Event of Default (as defined in the       
Interest Rate Swap Agreement) with respect to which the Swap Provider is the    
defaulting party or a Termination Event (as defined in the Interest Rate Swap   
Agreement) (other than Illegality or a Tax Event that is not a Tax Event Upon   
Merger (each as defined in the Interest Rate Swap Agreement )) with respect to  
which the Swap Provider is the sole Affected Party (as defined in the Interest  
Rate Swap Agreement).                                                           

           Deficient Valuation: With respect to any Mortgage Loan, a valuation
of the related Mortgaged Property by a court of competent jurisdiction in an    
amount less than the then outstanding principal balance of the Mortgage Loan,   
which valuation results from a proceeding initiated under the United States     
Bankruptcy Code.                                                                

        Definitive Certificates: Any Certificate evidenced by a Physical
Certificate and any Certificate issued in lieu of a Book-Entry Certificate      
pursuant to Section 5.02(e).                                                    

      Delay Certificates: As specified in the Preliminary Statement.

Deleted Mortgage Loan: As defined in Section 2.03.      

           Delinquency Trigger Event: With respect to any Distribution Date, a
Delinquency Trigger Event exists if the quotient (expressed as a percentage) of 
(x) the rolling three month average of the aggregate Stated Principal Balance of
60+ Day Delinquent Mortgage Loans (including Mortgage Loans in foreclosure and  
Mortgage Loans related to REO Property) and (y) (1) until the aggregate Class   
Certificate Balance of the Class A Certificates have been reduced to zero, the  
aggregate Stated Principal Balance of the Mortgage Loans for such Distribution  
Date equals or exceeds 37.90% of the prior period's Senior Enhancement          
Percentage and (2) after the aggregate Class Certificate Balance of the Class A 
Certificates have been reduced to zero, the aggregate Stated Principal Balance  
of the Mortgage Loans for such Distribution Date equals or exceeds 45.20% of the
prior period's Class M Enhancement Percentage.                                  

            Denomination: With respect to each Certificate, the amount set forth
on the face thereof as the "Initial Certificate Balance of this Certificate" or 
the Percentage Interest appearing on the face thereof.                          

Depositor: Morgan Stanley ABS Capital I Inc., a Delaware
corporation, and its successors in interest.                                    

        Depository: The initial Depository shall be The Depository Trust
Company, the nominee of which is CEDE & Co., as the registered Holder of the    
Book-Entry Certificates. The Depository shall at all times be a "clearing       
corporation" as defined in Section 8-102(a)(5) of the Uniform Commercial Code of
the State of New York.                                                          

            Depository Institution: Any depository institution or trust company,
including the Trustee, that (a) is incorporated under the laws of the United    
States of America or any State thereof, (b) is subject to supervision and       
examination by federal or state banking authorities and (c) has outstanding     
unsecured commercial paper or other short-term unsecured debt obligations that  
are rated "P-1" by Moody's, "F1+" by Fitch and "A-1" by Standard & Poor's (to   
the extent they are Rating Agencies hereunder).                                 

         Depository Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects     
book-entry transfers and pledges of securities deposited with the Depository.   

            Determination Date: With respect to each Distribution Date, the 18th
day (or if such day is not a Business Day, the immediately preceding Business   
Day) in the calendar month in which such Distribution Date occurs.              

       Distribution Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.07(d) in the name of the Trustee
for the benefit of the Certificateholders and designated "Deutsche Bank National
Trust Company in trust for registered holders of Morgan Stanley ABS Capital I   
Inc. Trust 2006-NC1 Mortgage Pass-Through Certificates, Series 2006-NC1". Funds 
in the Distribution Account shall be held in trust for the Certificateholders   
for the uses and purposes set forth in this Agreement.                          

       Distribution Account Deposit Date: As to any Distribution Date,
12:00 noon New York City time on the second Business Day immediately preceding  
such Distribution Date.                                                         

          Distribution Date: The 25th day of each calendar month, or if such
day is not a Business Day, the next succeeding Business Day, commencing in      
February 2006.                                                                  

           Document Certification and Exception Report: The report attached to
Exhibit F hereto.                                                               

            Due Date: The day of the month on which the Scheduled Payment is due
on a Mortgage Loan, exclusive of any days of grace.                             

     Due Period: With respect to any Distribution Date, the period
commencing on the second day of the calendar month preceding the month in which 
such Distribution Date occurs and ending on the first day of the calendar month 
in which such Distribution Date occurs.                                         

            Eligible Account: Either (i) an account maintained with a federal or
state chartered depository institution or trust company that complies with the  
definition of Eligible Institution, (ii) an account maintained with the         
corporate trust department of a federal depository institution or               
state-chartered depository institution subject to regulations regarding         
fiduciary funds on deposit similar to Title 12 of the U.S. Code of Federal      
Regulation Section 9.10(b), which, in either case, has corporate trust powers   
and is acting in its fiduciary capacity or (iii) any other account acceptable to
each Rating Agency. Eligible Accounts may bear interest, and may include, if    
otherwise qualified under this definition, accounts maintained with the Trustee.
Each Eligible Account shall be a separate account.                              

     Eligible Institution: A federal or state-chartered depository
institution or trust company the commercial paper, short-term debt obligations, 
or other short-term deposits of which are rated "A-1+" by Standard & Poor's if  
the amounts on deposit are to be held in the account for no more than 365 days  
(or at least "A-2" by Standard & Poor's if the amounts on deposit are to be held
in the account for no more than 30 days), or the long-term unsecured debt       
obligations of which are rated at least "AA-" by Standard & Poor's if the       
amounts on deposit are to be held in the account for no more than 365 days, and 
the commercial paper, short-term debt obligations or other short-term deposits  
of which are rated at least "P-1" by Moody's and "F1+" by Fitch (or a comparable
rating if another Rating Agency is specified by the Depositor by written notice 
to the Servicer and the Trustee) (in each case, to the extent they are          
designated as Rating Agencies in the Preliminary Statement).                    

      ERISA: The Employee Retirement Income Security Act of 1974, as
amended.                                                                        

        ERISA-Qualifying Underwriting: A best efforts or firm commitment
underwriting or private placement that meets the requirements of Prohibited     
Transaction Exemption ("PTE") 2002-41, 67 Fed. Reg. 54487 (2002) (or any        
successor thereto), or any substantially similar administrative exemption       
granted by the U.S. Department of Labor.                                        

     ERISA-Restricted Certificate: As specified in the Preliminary
Statement.                                                                      

        Escrow Account: The Eligible Account or Accounts established and
maintained pursuant to Section 3.09(b).                                         

Escrow Payments: As defined in Section 3.09(b).         

Event of Default: As defined in Section 7.01.           

          Excess Reserve Fund Account: The separate Eligible Account created
and maintained by the Trustee pursuant to Sections 3.07(b) and 3.07(c) in the   
name of the Trustee for the benefit of the Regular Certificateholders and       
designated "Deutsche Bank National Trust Company in trust for registered Holders
of Morgan Stanley ABS Capital I Inc. Trust 2006-NC1, Mortgage Pass-Through      
Certificates, Series 2006-NC1". Funds in the Excess Reserve Fund Account shall  
be held in trust for the Regular Certificateholders for the uses and purposes   
set forth in this Agreement. Amounts on deposit in the Excess Reserve Fund      
Account shall not be invested.                                                  

          Excess Subordinated Amount: With respect to any Distribution Date,
the excess, if any, of (a) the Subordinated Amount on such Distribution Date    
over (b) the Specified Subordinated Amount for such Distribution Date.          

      Exchange Act: The Securities Exchange Act of 1934, as amended.

          Expense Fee Rate: As to each Mortgage Loan, a per annum rate equal
to the sum of the Servicing Fee Rate, the Trustee Fee Rate and any lender-paid  
primary mortgage insurance fee rate, if applicable.                             

        Expense Fees: As to each Mortgage Loan, the sum of the Servicing
Fee, the Trustee Fee and any lender-paid primary mortgage insurance fee, if     
applicable.                                                                     

         Extra Principal Distribution Amount: As of any Distribution Date,
the lesser of (x) the related Total Monthly Excess Spread for such Distribution 
Date and (y) the related Subordination Deficiency for such Distribution Date.   

     Fannie Mae: The Federal National Mortgage Association, or any
successor thereto.                                                              

           Fannie Mae Guides: The Fannie Mae Sellers' Guide and the Fannie Mae
Servicers' Guide and all amendments or additions thereto.                       

         FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.                                                                        

            Final Recovery Determination: With respect to any defaulted Mortgage
Loan or any REO Property (other than a Mortgage Loan or REO Property purchased  
by the Responsible Party, as contemplated by this Agreement), a determination   
made by the applicable Servicer that all Insurance Proceeds, Condemnation       
Proceeds, Liquidation Proceeds and other payments or recoveries which the       
applicable Servicer, in its reasonable good faith judgment, expects to be       
finally recoverable in respect thereof have been so recovered. Each Servicer    
shall maintain records, prepared by a Servicing Officer, of each Final Recovery 
Determination made thereby.                                                     

           Final Scheduled Distribution Date: The Final Scheduled Distribution
Date for each Class of Certificates is the Distribution Date in December 2035.  

         First Lien Mortgage Loan: A Mortgage Loan secured by a first lien
Mortgage on the related Mortgaged Property.                                     

       Fitch: Fitch, Inc., and its successors in interest. If Fitch is
designated as a Rating Agency in the Preliminary Statement, for purposes of     
Section 12.05(b) the address for notices to Fitch shall be Fitch, Inc., One     
State Street Plaza, New York, New York 10004, Attention: MBS Monitoring - Morgan
Stanley ABS Capital I Inc. Trust 2006-NC1, or such other address as Fitch may   
hereafter furnish to the Depositor, the Trustee and the Servicers.              

Fixed Rate Mortgage Loan: A fixed rate Mortgage Loan.   

            Freddie Mac: The Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States created and existing under Title III of the
Emergency Home Finance Act of 1970, as amended, or any successor thereto.       

         Gross Margin: With respect to each Adjustable Rate Mortgage Loan,
the fixed percentage amount set forth in the related Mortgage Note to be added  
to the applicable Index to determine the Mortgage Rate.                         

         HomEq: HomEq Servicing Corporation, a New Jersey corporation, and
its successors in interest.                                                     

            Index: As to each Adjustable Rate Mortgage Loan, the index from time
to time in effect for the adjustment of the Mortgage Rate set forth as such on  
the related Mortgage Note.                                                      

           Insurance Policy: With respect to any Mortgage Loan included in the
Trust Fund, any insurance policy, including all riders and endorsements thereto 
in effect, including any replacement policy or policies for any Insurance       
Policies.                                                                       

           Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.

        Interest Accrual Period: With respect to each Class of Non-Delay
Certificates and the Corresponding Class of Lower Tier Regular Interests and any
Distribution Date, the period commencing on the Distribution Date occurring in  
the month preceding the month in which the current Distribution Date occurs and 
ending on the day immediately preceding the current Distribution Date (or, in   
the case of the first Distribution Date, the period from and including the      
Closing Date to but excluding such first Distribution Date). For purposes of    
computing interest accruals on each Class of Non-Delay Certificates, each       
Interest Accrual Period has the actual number of days in such month and each    
year is assumed to have 360 days.                                               

           Interest Rate Adjustment Date: With respect to each Adjustable Rate
Mortgage Loan, the date, specified in the related Mortgage Note and the Mortgage
Loan Schedule, on which the Mortgage Rate is adjusted.                          

       Interest Rate Swap Agreement: The interest rate swap agreement,
dated as of the Closing Date, between Morgan Stanley Capital Services Inc. and  
the Trustee, a copy of which is attached hereto as Exhibit T.                   

         Interest Remittance Amount: With respect to any Distribution Date
and the Mortgage Loans, that portion of Available Funds attributable to interest
relating to Mortgage Loans.                                                     

Investment Account: As defined in Section 3.12(a).      

     Investor-Based Exemption: Any of Prohibited Transaction Class
Exemption ("PTCE") 84-14 (for transactions by independent "qualified            
professional asset managers"), PTCE 90-1 (for transactions by insurance company 
pooled separate accounts), PTCE 91-38 (for transactions by bank collective      
investment funds), PTCE 95-60 (for transactions by insurance company general    
accounts) or PTCE 96-23 (for transactions effected by "in-house asset           
managers"), or any comparable exemption available under Similar Law.            

       JPMorgan: JPMorgan Chase Bank, National Association, a national
banking association, and its successors in interest.                            

       Late Collections: With respect to any Mortgage Loan and any Due
Period, all amounts received after the Determination Date immediately following 
such Due Period, whether as late payments of Scheduled Payments or as Insurance 
Proceeds, Condemnation Proceeds, Liquidation Proceeds or otherwise, which       
represent late payments or collections of principal and/or interest due (without
regard to any acceleration of payments under the related Mortgage and Mortgage  
Note) but delinquent for such Due Period and not previously recovered.          

          LIBOR: With respect to any Interest Accrual Period for the Offered
Certificates, the rate determined by the Trustee on the related LIBOR           
Determination Date on the basis of the offered rate for one-month U.S. dollar   
deposits as such rate appears on Telerate Page 3750 as of 11:00 a.m. (London    
time) on such date; provided, that if such rate does not appear on Telerate Page
3750, the rate for such date will be determined on the basis of the rates at    
which one-month U.S. dollar deposits are offered by the Reference Banks at      
approximately 11:00 a.m. (London time) on such date to prime banks in the London
interbank market. In such event, the Trustee shall request the principal London 
office of each of the Reference Banks to provide a quotation of its rate. If at 
least two such quotations are provided, the rate for that date will be the      
arithmetic mean of the quotations (rounded upwards if necessary to the nearest  
whole multiple of 1/16%). If fewer than two quotations are provided as          
requested, the rate for that date will be the arithmetic mean of the rates      
quoted by major banks in New York City, selected by the Trustee (after          
consultation with the Depositor), at approximately 11:00 a.m. (New York City    
time) on such date for one-month U.S. dollar loans to leading European banks.   

      LIBOR Determination Date: With respect to any Interest Accrual
Period for the Offered Certificates, the second London Business Day preceding   
the commencement of such Interest Accrual Period.                               

          Liquidated Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) which either (a) was       
liquidated in the calendar month preceding the month of such Distribution Date  
and as to which the applicable Servicer has certified to the Trustee that it has
received all amounts it expects to receive in connection with the liquidation of
such Mortgage Loan including the final disposition of an REO Property, or (b) is
a Second Lien Mortgage Loan (1) that is delinquent 180 days or longer, (2) for  
which the related first lien mortgage loan is not a Mortgage Loan, and (3) as to
which the applicable Servicer has certified to the Trustee that it does not     
believe there is a reasonable likelihood that any further net proceeds will be  
received or recovered with respect to such Second Lien Mortgage Loan.           

  Liquidation Proceeds: Cash received in connection with the
liquidation of a Liquidated Mortgage Loan, whether through a trustee's sale,    
foreclosure sale or otherwise, including any Subsequent Recoveries.             

           Loan-to-Value Ratio or LTV: With respect to any First Lien Mortgage
Loan, the ratio (expressed as a percentage) of the original outstanding         
principal amount of the First Lien Mortgage Loan as of the Cut-off Date (unless 
otherwise indicated), to the lesser of (a) the Appraised Value of the Mortgaged 
Property at origination, and (b) if the First Lien Mortgage Loan was made to    
finance the acquisition of the related Mortgaged Property, the purchase price of
the Mortgaged Property.                                                         

            London Business Day: Any day on which dealings in deposits of United
States dollars are transacted in the London interbank market.                   

            Lower Tier Interest Rate: As described in the Preliminary Statement.

    Lower Tier Principal Amount: As described in the Preliminary
Statement.                                                                      

            Lower-Tier Regular Interest: Each of the Class LT-A-1, Class LT-A-2,
Class LT-A-3, Class LT-A-4, Class LT-M-1, Class LT-M-2, Class LT-M-3, Class     
LT-M-4, Class LT-M-5, Class LT-M-6, Class LT-B-1, Class LT-B-2, Class LT-B-3,   
Class LT-IO and Class LT-Accrual Interests as described in the Preliminary      
Statement.                                                                      

    Lower Tier REMIC: As described in the Preliminary Statement.

            Maximum Mortgage Rate: With respect to each Adjustable Rate Mortgage
Loan, a rate that (i) is set forth on the Data Tape Information and in the      
related Mortgage Note and (ii) is the maximum interest rate to which the        
Mortgage Rate on such Adjustable Rate Mortgage Loan may be increased during the 
lifetime of such Adjustable Rate Mortgage Loan.                                 

            Minimum Mortgage Rate: With respect to each Adjustable Rate Mortgage
Loan, a rate that (i) is set forth on the Data Tape Information and in the      
related Mortgage Note and (ii) is the minimum interest rate to which the        
Mortgage Rate on such Adjustable Rate Mortgage Loan may be decreased during the 
lifetime of such Adjustable Rate Mortgage Loan.                                 

            Monthly Statement: The statement delivered to the Certificateholders
pursuant to Section 4.03.                                                       

      Moody's: Moody's Investors Service, Inc, and its successors in
interest. If Moody's is designated as a Rating Agency in the Preliminary        
Statement, for purposes of Section 10.05(b) the address for notices to Moody's  
shall be Moody's Investors Service, Inc., 99 Church Street, New York, New York  
10007, Attention: Residential Mortgage Pass-Through Group, or such other address
as Moody's may hereafter furnish to the Depositor, the Trustee and the          
Servicers.                                                                      

            Mortgage: The mortgage, deed of trust or other instrument identified
on the Mortgage Loan Schedule as securing a Mortgage Note.                      

         Mortgage File: The items pertaining to a particular Mortgage Loan
contained in either the Servicing File or Custodial File.                       

          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 Scheduled Payments, Principal        
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,   
REO Disposition proceeds, Prepayment Charges, and all other rights, benefits,   
proceeds and obligations arising from or in connection with such Mortgage Loan, 
excluding replaced or repurchased Mortgage Loans.                               

         Mortgage Loan Schedule: A schedule of Mortgage Loans delivered to
the Trustee and referred to on Schedule I, such schedule setting forth the      
following information with respect to each Mortgage Loan: (1) the Mortgage Loan 
number; (2) the city, state and zip code of the Mortgaged Property; (3) the     
number and type of residential units constituting the Mortgaged Property; (4)   
the current Mortgage Rate; (5) the current net Mortgage Rate; (6) the current   
Scheduled Payment; (7) with respect to each Adjustable Rate Mortgage Loan, the  
Gross Margin; (8) the original term to maturity; (9) the scheduled maturity     
date; (10) 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; (11) with respect to each Adjustable Rate Mortgage    
Loan, the next Interest Rate Adjustment Date; (12) with respect to each         
Adjustable Rate Mortgage Loan, the lifetime Mortgage Interest Rate Cap; (13)    
whether the Mortgage Loan is convertible or not; (14) the Servicing Fee; (15)   
the date such Mortgage Loan was sold by the Responsible Party to the Sponsor;   
(16) whether such Mortgage Loan provides for a Prepayment Charge as well as the 
term and amount of such Prepayment Charge, if any; (17) with respect to each    
First Lien Mortgage Loan, the LTV at origination and with respect to each Second
Lien Mortgage Loan, the CLTV at origination; (18) the applicable Servicer's     
name; and (19) the date on which servicing of the Mortgage Loan was transferred 
to the applicable Servicer.                                                     

          Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor under a Mortgage Loan.                                                

            Mortgage Rate: The annual rate of interest borne on a Mortgage Note,
which shall be adjusted from time to time in the case of an Adjustable Rate     
Mortgage Loan.                                                                  

       Mortgage Rate Caps: With respect to an Adjustable Rate Mortgage
Loan, the Periodic Mortgage Rate Cap, the Maximum Mortgage Rate, and the Minimum
Mortgage Rate for such Mortgage Loan.                                           

        Mortgaged Property: With respect to each Mortgage Loan, the real
property (or leasehold estate, if applicable) identified on the Mortgage Loan   
Schedule as securing repayment of the debt evidenced by the related Mortgage    
Note.                                                                           

Mortgagor: The obligor(s) on a Mortgage Note.           

           Net Monthly Excess Cash Flow: For any Distribution Date, the amount
remaining for distribution pursuant to subsection 4.02(a)(iii) (before giving   
effect to distributions pursuant to such subsection).                           

         Net Prepayment Interest Shortfall: For any Distribution Date, the
amount by which the sum of the Prepayment Interest Shortfalls for such          
Distribution Date exceeds the sum of (i) all Prepayment Interest Excesses for   
such Distribution Date and (ii) Compensating Interest payments made with respect
to such Distribution Date.                                                      

        Net Swap Payment: With respect to any Distribution Date, any net
payment (other than a Swap Termination Payment) payable by the Trust to the Swap
Provider on the related Fixed Rate Payer Payment Date (as defined in the        
Interest Rate Swap Agreement).                                                  

        Net Swap Receipt: With respect to any Distribution Date, any net
payment (other than a Swap Termination Payment) made by the Swap Provider to the
Trust on the related Floating Rate Payer Payment Date (as defined in the        
Interest Rate Swap Agreement).                                                  

   NIM Issuer: The entity established as the issuer of the NIM
Securities.                                                                     

          NIM Securities: Any debt securities secured or otherwise backed by
some or all of the Class X and Class P Certificates that are rated by one or    
more Rating Agencies.                                                           

NIM Trustee: The trustee for the NIM Securities.        

          Non-Delay Certificates: As specified in the Preliminary Statement.

 Non-Permitted Transferee: A Person other than a Permitted
Transferee.                                                                     

      Nonrecoverable P&I Advance: Any P&I Advance previously made or
proposed to be made in respect of a Mortgage Loan or REO Property that, in the  
good faith business judgment of the applicable Servicer, will not or, in the    
case of a proposed P&I Advance, would not be ultimately recoverable from related
late payments, Insurance Proceeds, Condemnation Proceeds, or Liquidation        
Proceeds on such Mortgage Loan or REO Property as provided herein.              

           Nonrecoverable Servicing Advance: Any Servicing Advances previously
made or proposed to be made in respect of a Mortgage Loan or REO Property,      
which, in accordance with Accepted Servicing Practices, will not or, in the case
of a proposed Servicing Advance, would not be ultimately recoverable from       
related Insurance Proceeds, Condemnation Proceeds, Liquidation Proceeds or      
otherwise.                                                                      

           Notice of Final Distribution: The notice to be provided pursuant to
Section 9.02 to the effect that final distribution on any of the Certificates   
shall be made only upon presentation and surrender thereof.                     

        Offered Certificates: As specified in the Preliminary Statement.

        Officer's Certificate: A certificate signed by an officer of any
Servicer or Subservicer with responsibility for the servicing of the Mortgage   
Loans required to be serviced by such Servicer or Subservicer and listed on a   
list delivered to the Trustee pursuant to this Agreement.                       

    Opinion of Counsel: A written opinion of counsel, who may be
in-house counsel for a Servicer or a Subservicer, reasonably acceptable to the  
Trustee (and/or such other Persons as may be set forth herein), provided, that  
any Opinion of Counsel relating to (a) qualification of any Trust REMIC or (b)  
compliance with the REMIC Provisions, must be (unless otherwise stated in such  
Opinion of Counsel) an opinion of counsel who (i) is in fact independent of such
Servicer of the Mortgage Loans, (ii) does not have any material direct or       
indirect financial interest in such Servicer of the Mortgage Loans or in an     
Affiliate of either and (iii) is not connected with such Servicer of the        
Mortgage Loans as an officer, employee, director or person performing similar   
functions.                                                                      

     Optional Termination Date: The Distribution Date on which the
aggregate Stated Principal Balance of the Mortgage Loans, as of the last day of 
the related Due Period, is equal to 10% or less of the Cut-off Date Pool        
Principal Balance.                                                              

Originator: The Responsible Party.                      

     OTS: Office of Thrift Supervision, and any successor thereto.

       Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and authenticated under    
this Agreement except:                                                          

            (i) Certificates theretofore canceled by the Trustee or delivered to
the Trustee for cancellation; and                                   

         (ii) Certificates in exchange for which or in lieu of which other
    Certificates have been executed and delivered by the Trustee pursuant to
this Agreement.                                                     

           Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan with
a Stated Principal Balance greater than zero which was not the subject of a     
Principal Prepayment in Full prior to such Due Date and which did not become a  
Liquidated Mortgage Loan prior to such Due Date.                                

         Ownership Interest: As to any Residual Certificate, any ownership
interest in such Certificate including any interest in such Certificate as the  
Holder thereof and any other interest therein, whether direct or indirect, legal
or beneficial.                                                                  

         P&I Advance: As to any Mortgage Loan or REO Property, any advance
made by the applicable Servicer in respect of any Remittance Date representing  
the aggregate of all payments of principal and interest, net of the Servicing   
Fee, that were due during the related Due Period on the Mortgage Loans and that 
were delinquent on the related Determination Date, plus certain amounts         
representing assumed payments not covered by any current net income on the      
Mortgaged Properties acquired by foreclosure or deed in lieu of foreclosure as  
determined pursuant to Section 4.01.                                            

  Pass-Through Margin: With respect to each Class of Regular
Certificates except as set forth in the following sentence, the following       
percentages: Class A-1 Certificates, 0.0800%; Class A-2 Certificates, 0.1400%;  
Class A-3 Certificates, 0.1900%; Class A-4 Certificates, 0.3000%; Class M-1     
Certificates, 0.3800%; Class M-2 Certificates, 0.4000%; Class M-3 Certificates, 
0.4200%; Class M-4 Certificates, 0.5200%; Class M-5 Certificates, 0.5500%; Class
M-6 Certificates, 0.6600%; Class B-1 Certificates, 1.2500%; Class B-2           
Certificates, 1.4500%; and Class B-3 Certificates, 2.2000%. On the first        
Distribution Date after the Optional Termination Date, the Pass-Through Margins 
shall increase to: Class A-1 Certificates, 0.1600%; Class A-2 Certificates,     
0.2800%; Class A-3 Certificates, 0.3800%; Class A-4 Certificates, 0.6000%; Class
M-1 Certificates, 0.5700%; Class M-2 Certificates, 0.6000%; Class M-3           
Certificates, 0.6300%; Class M-4 Certificates, 0.7800%; Class M-5 Certificates, 
0.8250%; Class M-6 Certificates, 0.9900%; Class B-1 Certificates, 1.8750%; Class
B-2 Certificates, 2.1750%; and Class B-3 Certificates, 3.3000%.                 

       Pass-Through Rate: For each Class of Regular Certificates, each
Pooling-Tier REMIC-1 Regular Interest, each Pooling-Tier REMIC-2 Regular        
Interest, each Lower-Tier Regular Interest and each Upper-Tier Regular Interest,
the per annum rate set forth or calculated in the manner described in the       
Preliminary Statement.                                                          

PCAOB: The Public Company Accounting Oversight Board.   

           Percentage Interest: As to any Certificate, the percentage interest
evidenced thereby in distributions required to be made on the related Class,    
such percentage interest being set forth on the face thereof or equal to the    
percentage obtained by dividing the Denomination of such Certificate by the     
aggregate of the Denominations of all Certificates of the same Class.           

      Periodic Mortgage Rate Cap: With respect to an Adjustable Rate
Mortgage Loan, the periodic limit on each Mortgage Rate adjustment as set forth 
in the related Mortgage Note.                                                   

           Permitted Investments: Any one or more of the following obligations
or securities acquired at a purchase price of not greater than par, regardless  
of whether issued by any Servicer, the Trustee or any of their respective       
Affiliates:                                                                     

        (i) direct obligations of, or obligations fully guaranteed as to
 timely payment of 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) demand and time deposits in, certificates of deposit of, or
   bankers' acceptances (which shall each have an original maturity of not
   more than 90 days and, in the case of bankers' acceptances, shall in no
event have an original maturity of more than 365 days or a remaining
   maturity of more than 30 days) denominated in United States dollars and
      issued by, any Depository Institution and rated "P-1" by Moody's, "F1+" by
 Fitch, and "A-1+" by Standard & Poor's (to the extent they are Rating
Agencies hereunder and are so rated by such Rating Agency);         

           (iii) repurchase obligations with respect to any security described
     in clause (i) above entered into with a Depository Institution (acting as
principal);                                                         

       (iv) securities bearing interest or sold at a discount that are
      issued by any corporation incorporated under the laws of the United States
    of America or any State thereof and that are rated by each Rating Agency
that rates such securities in its highest long-term unsecured rating
categories at the time of such investment or contractual commitment 
providing for such investment;                                      

          (v) commercial paper (including both non-interest-bearing discount
  obligations and interest-bearing obligations payable on demand or on a
specified date not more than 30 days after the date of acquisition  
      thereof) that is rated by each Rating Agency that rates such securities in
      its highest short-term unsecured debt rating available at the time of such
investment;                                                         

      (vi) units of money market funds, including money market funds
    advised by the Depositor, the Trustee or an Affiliate thereof, that have
      been rated "Aaa" by Moody's, "AAAm" by Standard & Poor's and at least "AA"
     by Fitch (to the extent they are Rating Agencies hereunder and such funds
are so rated by such Rating Agency); and                            

          (vii) if previously confirmed in writing to the Trustee, any other
      demand, money market or time deposit, or any other obligation, security or
  investment, as may be acceptable to the Rating Agencies as a permitted
investment of funds backing "Aaa" or "AAA" rated securities;        

provided, however, that no instrument described hereunder shall evidence either 
the right to receive (a) only interest with respect to the obligations          
underlying such instrument or (b) both principal and interest payments derived  
from obligations underlying such instrument and the interest and principal      
payments with respect to such instrument provide a yield to maturity at par     
greater than 120% of the yield to maturity at par of the underlying obligations.

          Permitted Transferee: Any Person other than (i) the United States,
any State or political subdivision thereof, or any agency or instrumentality of 
any of the foregoing, (ii) a foreign government, international organization or  
any agency or instrumentality of either of the foregoing, (iii) an organization 
(except certain farmers' cooperatives described in Section 521 of the Code)     
which is exempt from tax imposed by Chapter 1 of the Code (including the tax    
imposed by Section 511 of the Code on unrelated business taxable income) on any 
excess inclusions (as defined in Section 860E(c)(1) of the Code) with respect to
any Residual Certificate, (iv) rural electric and telephone cooperatives        
described in Section 1381(a)(2)(C) of the Code, (v) a Person that is not a U.S. 
Person or a U.S. Person with respect to whom income from a Residual Certificate 
is attributable to a foreign permanent establishment or fixed base, within the  
meaning of an applicable income tax treaty, of such Person or any other U.S.    
Person, (vi) an "electing large partnership" within the meaning of Section 775  
of the Code and (vii) any other Person so designated by the Depositor based upon
an Opinion of Counsel that the Transfer of an Ownership Interest in a Residual  
Certificate to such Person may cause any Trust REMIC to fail to qualify as a    
REMIC at any time that the Certificates are outstanding. The terms "United      
States", "State" and "international organization" shall have the meanings set   
forth in Section 7701 of the Code or successor provisions. A corporation will   
not be treated as an instrumentality of the United States or of any State or    
political subdivision thereof for these purposes if all of its activities are   
subject to tax and, with the exception of Freddie Mac, a majority of its board  
of directors is not selected by such government unit.                           

        Person: Any individual, corporation, partnership, joint venture,
association, limited liability company, joint-stock company, trust,             
unincorporated organization or government, or any agency or political           
subdivision thereof.                                                            

         Physical Certificates: As specified in the Preliminary Statement.

       Pool Stated Principal Balance: As to any Distribution Date, the
aggregate of the Stated Principal Balances of the Mortgage Loans for such       
Distribution Date that were Outstanding Mortgage Loans on the Due Date in the   
related Due Period.                                                             

   Pooling-Tier Interest Rate: As specified in the Preliminary
Statement.                                                                      

        Pooling-Tier REMIC-1: As described in the Preliminary Statement.

           Pooling-Tier REMIC-1 Interest Rate: As described in the Preliminary
Statement.                                                                      

  Pooling-Tier REMIC-1 Principal Amount: As described in the
Preliminary Statement.                                                          

  Pooling-Tier REMIC-1 Regular Interest: As described in the
Preliminary Statement.                                                          

            Pooling-Tier REMIC-1 WAC Rate: With respect to the Mortgage Loans as
of any Distribution Date, a per annum rate equal to the weighted average of the 
Adjusted Net Mortgage Rates for each such Mortgage Loan then in effect on the   
beginning of the related Due Period on the Mortgage Loans, adjusted in each case
to accrue on the basis of a 360 day year and the actual number of days in the   
related Interest Accrual Period.                                                

        Pooling-Tier REMIC-2: As described in the Preliminary Statement.

           Pooling-Tier REMIC-2 Interest Rate: As described in the Preliminary
Statement.                                                                      

         Pooling-Tier REMIC-2 IO Interest: Any of the Pooling Tier REMIC-2
Regular Interests with the designation "IO" in its name.                        

     Pooling-Tier REMIC-2 IO Notional Balance: As described in the
Preliminary Statement.                                                          

  Pooling-Tier REMIC-2 Principal Amount: As described in the
Preliminary Statement.                                                          

  Pooling-Tier REMIC-2 Regular Interest: As described in the
Preliminary Statement.                                                          

    Prepayment Charge: Any prepayment premium, penalty or charge
collected by any Servicer with respect to a Mortgage Loan from a Mortgagor in   
connection with any voluntary Principal Prepayment pursuant to the terms of the 
related Mortgage Note.                                                          

          Prepayment Interest Excess: With respect to any Distribution Date,
any interest collected by the Servicer as to which a Principal Prepayment in    
Full occurs from the 1st day of the month through the 15th day of the month in  
which such Distribution Date occurs and that represents interest that accrues   
from the 1st day of such month to the date of such Principal Prepayment in Full.

       Prepayment Interest Shortfall: With respect to any Distribution
Date, the sum of, for each Mortgage Loan that was, during the portion of the    
Prepayment Period from and including the 16th day of the month preceding the    
month in which such Distribution Date occurs (or from the day following the     
Cut-off Date, in the case of the first Distribution Date) through the last day  
of such month, the subject of a Principal Prepayment which is not accompanied by
an amount equal to one month of interest that would have been due on such       
Mortgage Loan on the Due Date in the following month and which was applied by   
the applicable Servicer to reduce the outstanding principal balance of such     
Mortgage Loan on a date preceding such Due Date an amount equal to the product  
of (a) the Mortgage Rate net of the Servicing Fee Rate for such Mortgage Loan,  
(b) the amount of the Principal Prepayment for such Mortgage Loan, (c) 1/360 and
(d) the number of days commencing on the date on which such Principal Prepayment
was applied and ending on the last day of the calendar month in which the       
related Prepayment Period begins.                                               

           Prepayment Period: With respect to any Distribution Date either (i)
with respect to any voluntary Principal Prepayments in Full, the period from and
including the 16th day of the month preceding the month in which such           
Distribution Date occurs (or, in the case of the first Distribution Date, from  
and including the Cut-off Date) to and including the 15th day of the month in   
which such Distribution Date occurs, or (ii) with respect to any other Principal
Prepayments, the calendar month preceding the month in which such Distribution  
Date occurs.                                                                    

            Principal Distribution Amount: For any Distribution Date, the sum of
(i) the Basic Principal Distribution Amount for such Distribution Date and (ii) 
the Extra Principal Distribution Amount for such Distribution Date.             

           Principal Prepayment: Any full or partial payment or other recovery
of principal on a Mortgage Loan (including upon liquidation of a Mortgage Loan) 
which is received in advance of its scheduled Due Date, excluding any Prepayment
Charge thereon.                                                                 

        Principal Prepayment in Full: Any Principal Prepayment made by a
Mortgagor of the entire principal balance of a Mortgage Loan.                   

           Principal Remittance Amount: With respect to any Distribution Date,
the amount equal to the sum of the following amounts (without duplication) with 
respect to the related Due Period: (i) each scheduled payment of principal on a 
Mortgage Loan due during such Due Period and received by the Servicers on or    
prior to the related Determination Date or advanced by the applicable Servicer  
for the related Remittance Date, and all Principal Prepayments received during  
the related Prepayment Period; (ii) all Liquidation Proceeds, Condemnation      
Proceeds and Insurance Proceeds on the Mortgage Loans allocable to principal    
actually collected by the Servicers during the related Prepayment Period; (iii) 
the portion of the Repurchase Price allocable to principal with respect to each 
Mortgage Loan, repurchased with respect to such Distribution Date; (iv) all     
Substitution Adjustment Amounts allocable to principal received in connection   
with the substitutions of Mortgage Loans with respect to such Distribution Date;
(v) with respect to the Distribution Date in February 2006 only, the portion of 
the Closing Date Deposit Amount allocable to principal; and (vi) the allocable  
portion of the proceeds received with respect to the termination of the Trust   
Fund pursuant to clause (a) of Section 9.01 (to the extent such proceeds relate 
to principal).                                                                  

        Private Certificates: As specified in the Preliminary Statement.

           Prospectus Supplement: The Prospectus Supplement, dated January 25,
2006, relating to the Offered Certificates.                                     

PTCE 95-60: As defined in Section 5.02(b).              

        Purchase Agreement: The Third Amended and Restated Mortgage Loan
Purchase and Warranties Agreement, dated as of December 1, 2005, between Morgan 
Stanley Capital Inc. and NC Capital Corporation.                                

   Rating Agency: Each of the Rating Agencies specified in the
Preliminary Statement. If such organization or a successor is no longer in      
existence, "Rating Agency" shall be such nationally recognized statistical      
rating organization, or other comparable Person, as is designated by the        
Depositor, notice of which designation shall be given to the Trustee. References
herein to a given rating or rating category of a Rating Agency shall mean such  
rating category without giving effect to any modifiers. For purposes of Section 
10.05(b), the addresses for notices to each Rating Agency shall be the address  
specified therefor in the definition corresponding to the name of such Rating   
Agency, or such other address as either such Rating Agency may hereafter furnish
to the Depositor, the Trustee and the Servicers.                                

          Realized Losses: With respect to any date of determination and any
Liquidated Mortgage Loan, the amount, if any, by which (a) the unpaid principal 
balance of such Liquidated Mortgage Loan together with accrued and unpaid       
interest thereon exceeds (b) the Liquidation Proceeds with respect thereto net  
of the expenses incurred by the applicable Servicer in connection with the      
liquidation of such Liquidated Mortgage Loan and net of the amount of           
unreimbursed Servicing Advances with respect to such Liquidated Mortgage Loan.  

        Record Date: With respect to any Distribution Date, the close of
business on the Business Day immediately preceding such Distribution Date;      
provided, however, that, for any Certificate issued in definitive form, the     
Record Date shall be the close of business on the last Business Day of the month
preceding the month in which such applicable Distribution Date occurs.          

Reference Bank: As defined in Section 4.04.             

        Regular Certificates: As specified in the Preliminary Statement.

 Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.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.                                                        

            Relief Act Interest Shortfall: With respect to any Distribution Date
and any Mortgage Loan, any reduction in the amount of interest collectible on   
such Mortgage Loan for the most recently ended Due Period as a result of the    
application of the Servicemembers Civil Relief Act or any similar state         
statutes.                                                                       

     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 real estate mortgage investment conduits, which appear at Sections 860A      
through 860G of Subchapter M of Chapter 1 of the Code, and related provisions,  
and regulations promulgated thereunder, as the foregoing may be in effect from  
time to time as well as provisions of applicable state laws.                    

          Remittance Date: With respect to any Distribution Date, the second
Business Day immediately preceding such Distribution Date.                      

         REO Disposition: The final sale by the applicable Servicer of any
REO Property.                                                                   

        REO Imputed Interest: As to any REO Property, for any period, an
amount equivalent to interest (at the Mortgage Rate net of the Servicing Fee    
Rate that would have been applicable to the related Mortgage Loan had it been   
outstanding) on the unpaid principal balance of the Mortgage Loan as of the date
of acquisition thereof (as such balance is reduced pursuant to Section 3.17 by  
any income from the REO Property treated as a recovery of principal).           

     REO Mortgage Loan: A Mortgage Loan where title to the related
Mortgaged Property has been obtained by the applicable Servicer in the name of  
the Trustee on behalf of the Certificateholders.                                

     REO Property: A Mortgaged Property acquired by the Trust Fund
through foreclosure or deed-in-lieu of foreclosure in connection with a         
defaulted Mortgage Loan.                                                        

      Replacement Swap Provider Payment: Any payments that have been
received by the Trust as a result of entering into a replacement interest rate  
swap agreement following an Additional Termination Event described in Part      
1(h)(ii) of the Interest Rate Swap Agreement.                                   

Reportable Event: As defined in Section 8.12(g).        

          Repurchase Price: With respect to any Mortgage Loan repurchased by
the Responsible Party, an amount equal to the sum of (i) the unpaid principal   
balance of such Mortgage Loan as of the date of repurchase, (ii) interest on    
such unpaid principal balance of such Mortgage Loan at the Mortgage Rate from   
the last date through which interest has been paid and distributed to the       
Trustee to the date of repurchase, (iii) all unreimbursed Servicing Advances and
(iv) all costs and expenses incurred by the Trustee arising out of or based upon
such breach, including without limitation, costs and expenses relating to the   
Trustee's enforcement of the Responsible Party's repurchase obligation          
hereunder.                                                                      

     Request for Release: The Request for Release submitted by the
applicable Servicer to the Trustee, substantially in the form of Exhibit J.     

         Residual Certificates: As specified in the Preliminary Statement.

       Responsible Officer: When used with respect to the Trustee, any
managing director, any vice president, any assistant vice president, any        
assistant secretary, any assistant treasurer, any associate, or any other       
officer of the Trustee customarily performing functions similar to those        
performed by any of the above designated officers who at such time shall be     
officers to whom, with respect to a particular matter, such matter is referred  
because of such officer's knowledge of and familiarity with the particular      
subject and who shall have direct responsibility for the administration of this 
Agreement.                                                                      

            Responsible Party: NC Capital Corporation, a California corporation,
and its successors in interest.                                                 

Rule 144A Letter: As defined in Section 5.02(b).        

Sarbanes Certification: As defined in Section 8.12(c).  

           Scheduled Payment: The scheduled monthly payment on a Mortgage Loan
due on any Due Date allocable to principal and/or interest on such Mortgage Loan
which, unless otherwise specified herein, shall give effect to any related Debt 
Service Reduction and any Deficient Valuation that affects the amount of the    
monthly payment due on such Mortgage Loan.                                      

           Second Lien Mortgage Loan: A Mortgage Loan secured by a second lien
Mortgage on the related Mortgaged Property.                                     

Securities Act: The Securities Act of 1933, as amended. 

      Senior Defaulted Swap Termination Payment: As of any date, the
lesser of (x) any Replacement Swap Provider Payment and (y) any Swap Termination
Payment owed to the Swap Provider.                                              

       Senior Enhancement Percentage: With respect to any Distribution
Date, the percentage obtained by dividing (x) the sum of (i) the aggregate Class
Certificate Balance of the Subordinated Certificates and (ii) the Subordinated  
Amount, in each case after taking into account the distribution of the Principal
Distribution Amount and any principal payments on those Classes of Certificates 
from the Swap Account on that Distribution Date, by (y) the aggregate Stated    
Principal Balance of the Mortgage Loans for such Distribution Date.             

  Senior Specified Enhancement Percentage: As of any date of
determination, 42.20%.                                                          

      Servicer: JPMorgan or HomEq, as applicable, and if a successor
servicer to either is appointed hereunder, such successor. When the term        
"Servicer" is used in this Agreement in connection with the administration of   
servicing obligations with respect to any Mortgage Loan, Mortgaged Property, REO
Property or Mortgage File, "Servicer" shall mean the Person identified as the   
Servicer of such Mortgage Loan on the Mortgage Loan Schedule.                   

  Servicer Remittance Report: As defined in Section 4.03(d).

    Servicing Advances: The reasonable "out-of-pocket" costs and
expenses (including legal fees) incurred by the applicable Servicer in the      
performance of its servicing obligations in connection with a default,          
delinquency or other unanticipated event, including, but not limited to, the    
cost of (i) the preservation, restoration, inspection and protection of a       
Mortgaged Property, (ii) any enforcement, administrative or judicial            
proceedings, including foreclosures and litigation, in respect of a particular  
Mortgage Loan, (iii) the management (including reasonable fees in connection    
therewith) and liquidation of any REO Property and (iv) the performance of its  
obligations under Sections 3.01, 3.09, 3.13 and 3.15. The Servicing Advances    
shall also include any reasonable "out-of-pocket" costs and expenses (including 
legal fees) incurred by the applicable Servicer in connection with executing and
recording instruments of satisfaction, deeds of reconveyance or Assignments of  
Mortgage in connection with any foreclosure in respect of any Mortgage Loan to  
the extent not recovered from the Mortgagor or otherwise payable under this     
Agreement. Neither Servicer shall be required to make any Nonrecoverable        
Servicing Advances.                                                             

      Servicing Criteria: The "servicing criteria" set forth in Item
1122(d) of Regulation AB, which as of the Closing Date are listed on Exhibit P  
hereto.                                                                         

        Servicing Fee: With respect to each Servicer, each Mortgage Loan
serviced by such Servicer and for any calendar month, an amount equal to one    
month's interest (or in the event of any payment of interest which accompanies a
Principal Prepayment in Full made by the Mortgagor during such calendar month,  
interest for the number of days covered by such payment of interest) at the     
Servicing Fee Rate on the applicable Stated Principal Balance of such Mortgage  
Loan as of the first day of such calendar month. Such fee shall be payable      
monthly, and shall be pro-rated for any portion of a month during which the     
Mortgage Loan is serviced by such Servicer under this Agreement. The Servicing  
Fee is payable solely from the interest portion (including recoveries with      
respect to interest from Liquidation Proceeds, Insurance Proceeds, Condemnation 
Proceeds and proceeds received with respect to REO Properties, to the extent    
permitted by Section 3.11) of such Scheduled Payment collected by such Servicer,
or as otherwise provided under Section 3.11.                                    

         Servicing Fee Rate: With respect to each Mortgage Loan, 0.50% per
annum.                                                                          

    Servicing File: With respect to each Mortgage Loan, the file
retained by the applicable Servicer consisting of originals or copies of all    
documents in the Mortgage File which are not delivered to the Trustee in the    
Custodial File and copies of the Mortgage Loan Documents set forth in Exhibit K 
hereto.                                                                         

      Servicing Function Participant: As defined in Section 3.23(a).

      Servicing Officer: Any officer of any Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans whose   
name and facsimile signature appear on a list of servicing officers furnished to
the Trustee by such Servicer on the Closing Date pursuant to this Agreement, as 
such list may from time to time be amended.                                     

            Servicing Transfer Date: With respect to any Mortgage Loan, the date
on which servicing of such Mortgage Loan was transferred to the applicable      
Servicer (as set forth on the Mortgage Loan Schedule).                          

Similar Law: As defined in Section 5.02(b).             

     60+ Day Delinquent Mortgage Loan: (i) Each Mortgage Loan with
respect to which any portion of a Scheduled Payment is, as of the last day of   
the prior Due Period, two months or more past due (without giving effect to any 
grace period), including, without limitation, such Mortgage Loans that are      
subject to bankruptcy proceedings, (ii) each Mortgage Loan in foreclosure and   
(iii) all REO Property.                                                         

            Specified Subordinated Amount: Prior to the Stepdown Date, an amount
equal to 4.35% of the Cut-off Date Pool Principal Balance. On and after the     
Stepdown Date, an amount equal to 8.70% of the aggregate Stated Principal       
Balance of the Mortgage Loans for such Distribution Date, subject, until the    
Class Certificate Balance of each Class of Offered Certificates has been reduced
to zero, to a minimum amount equal to 0.50% of the Cut-off Date Pool Principal  
Balance; provided, however, that if, on any Distribution Date, a Trigger Event  
exists, the Specified Subordinated Amount shall not be reduced to the applicable
percentage of the then current aggregate Stated Principal Balance of the        
Mortgage Loans until the Distribution Date on which a Trigger Event no longer   
exists. When the Class Certificate Balance of each Class of Offered Certificates
has been reduced to zero, the Specified Subordinated Amount will thereafter     
equal zero.                                                                     

 Sponsor: Morgan Stanley Mortgage Capital Inc., a New York
corporation, and its successors in interest, as purchaser of the Mortgage Loans 
under each of the Purchase Agreements.                                          

            Standard & Poor's: Standard & Poor's Ratings Services, a division of
The McGraw-Hill Companies, Inc., and its successors in interest. If Standard &  
Poor's is designated as a Rating Agency in the Preliminary Statement, for       
purposes of Section 10.05(b) the address for notices to Standard & Poor's shall 
be Standard & Poor's, 55 Water Street, New York, New York 10041, Attention:     
Residential Mortgage Surveillance Group - Morgan Stanley ABS Capital I Inc.     
Trust 2006-NC1, or such other address as Standard & Poor's may hereafter furnish
to the Depositor, the Trustee and the Servicers.                                

   Standard & Poor's Glossary: The Standard & Poor's LEVELS(R)
Glossary, as may be in effect from time to time.                                

Startup Day: The Closing Date.                          

        Stated Principal Balance: As to each Mortgage Loan and as of any
date of determination, (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 remitted to   
the Trustee with respect to the related Mortgage Loan representing payments or  
recoveries of principal including advances in respect of scheduled payments of  
principal. For purposes of any Distribution Date, the Stated Principal Balance  
of any Mortgage Loan will give effect to any scheduled payments of principal    
received by the related Servicer on or prior to the related Determination Date  
or advanced by the related Servicer for the related Remittance Date and any     
unscheduled principal payments and other unscheduled principal collections      
received during the related Prepayment Period, and the Stated Principal Balance 
of any Mortgage Loan that has prepaid in full or has become a Liquidated        
Mortgage Loan during the related Prepayment Period shall be zero.               

            Stepdown Date: The later to occur of (i) the earlier to occur of (a)
the Distribution Date in February 2009 and (b) the Distribution Date following  
the Distribution Date on which the aggregate Class Certificate Balances of the  
Class A Certificates have been reduced to zero and (ii) the first Distribution  
Date on which the Senior Enhancement Percentage (calculated for this purpose    
only after taking into account payments of principal on the Mortgage Loans      
applied to reduce the Stated Principal Balances of the Mortgage Loans for the   
applicable Distribution Date but prior to any allocation of the Principal       
Distribution Amount and principal payments from the Swap Account to the         
Certificates on such Distribution Date) is greater than or equal to the Senior  
Specified Enhancement Percentage.                                               

          Subcontractor: Any third-party or Affiliated vendor, subcontractor
or other Person utilized by a Servicer, a Subservicer or the Trustee, as        
applicable, 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.                        

       Subordinated Amount: With respect to any Distribution Date, the
excess, if any, of (a) the aggregate Stated Principal Balance of the Mortgage   
Loans for such Distribution Date over (b) the aggregate of the Class Certificate
Balances of the Offered Certificates as of such Distribution Date (after giving 
effect to the payment of the Principal Remittance Amount on such Certificates on
such Distribution Date).                                                        

  Subordinated Certificates: As specified in the Preliminary
Statement.                                                                      

            Subordination Deficiency: With respect to any Distribution Date, the
excess, if any, of (a) the Specified Subordinated Amount applicable to such     
Distribution Date over (b) the Subordinated Amount applicable to such           
Distribution Date.                                                              

        Subordination Reduction Amount: With respect to any Distribution
Date, an amount equal to the lesser of (a) the Excess Subordinated Amount and   
(b) the Net Monthly Excess Cash Flow.                                           

         Subsequent Recovery: With respect to any Mortgage Loan or related
Mortgaged Property that became a Liquidated Mortgage Loan or was otherwise      
disposed of, all amounts received in respect of such Liquidated Mortgage Loan   
after an Applied Realized Loss Amount related to such Mortgage Loan or Mortgaged
Property is allocated to reduce the Class Certificate Balance of any Class of   
Subordinated Certificates. Any Subsequent Recovery that is received during a    
Prepayment Period will be treated as Liquidation Proceeds and included as part  
of the Principal Remittance Amount for the related Distribution Date.           

           Subservicer: Any Person that services Mortgage Loans on behalf of a
Servicer 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 required to be performed by a Servicer under   
this Agreement, with respect to some or all of the Mortgage Loans, that are     
identified in Item 1122(d) of Regulation AB.                                    

Subservicing Account: As defined in Section 3.08.       

Subservicing Agreements: As defined in Section 3.02(a). 

    Substitute Mortgage Loan: A Mortgage Loan substituted by the
Responsible Party for a Deleted Mortgage Loan that satisfies the criteria set   
forth in the definition of "Qualified Substitute Mortgage Loan" in the          
applicable Purchase Agreement, which, must, on the date of such substitution, as
confirmed in a Request for Release, substantially in the form of Exhibit J, (i) 
have a Stated Principal Balance, after deduction of the principal portion of the
Scheduled Payment due in the month of substitution, not in excess of, and not   
more than 10% less than, the Stated Principal Balance of the Deleted Mortgage   
Loan; (ii) be accruing interest at a rate no lower than and not more than 1% per
annum higher than, that of the Deleted Mortgage Loan; (iii) have a Loan-to-Value
Ratio or a Combined Loan-to-Value Ratio, as applicable, no higher than that of  
the Deleted Mortgage Loan; (iv) have a remaining term to maturity no greater    
than (and not more than one year less than that of) the Deleted Mortgage Loan;  
and (v) comply with each representation and warranty set forth in Section 2.03. 

   Substitution Adjustment Amount: As defined in Section 2.03.

Swap Account: As defined in Section 4.06.               

           Swap Assets: Collectively, the Swap Account, the Interest Rate Swap
Agreement, the Class IO Interest and the right to receive Class IO Shortfalls,  
subject to the obligation to pay amounts specified in Section 4.06.             

          Swap LIBOR: With respect to any Distribution Date (and the related
Interest Accrual Period), the product of (i) USD-LIBOR-BBA (as used in the      
Interest Swap Agreement), (ii) two, and (iii) the quotient of (a) the actual    
number of days in the Interest Accrual Period for the Offered Certificates      
divided by (b) 30.                                                              

      Swap Payment Allocation: For any Class of Certificates and any
Distribution Date, that Class's pro rata share of the Net Swap Receipts, if any,
for that Distribution Date, based on the Class Certificate Balances of the      
Classes of Certificates.                                                        

     Swap Payment Rate: For any Distribution Date, a fraction, the
numerator of which is any Net Swap Payment or Swap Termination Payment owed to  
the Swap Provider for such Distribution Date and the denominator of which is the
aggregate Stated Principal Balance of the Mortgage Loans at the beginning of the
related Due Period, multiplied by 12.                                           

       Swap Provider: Morgan Stanley Capital Services Inc., a Delaware
corporation, and its successors in interest.                                    

         Swap Termination Payment: Any payment payable by the Trust or the
Swap Provider upon termination of the Interest Rate Swap Agreement as a result  
of an Event of Default (as defined in the Interest Rate Swap Agreement) or a    
Termination Event (as defined in the Interest Rate Swap Agreement).             

  Tax Matters Person: The Holder of the Class R Certificates
designated as "tax matters person" of each Trust REMIC in the manner provided   
under Treasury Regulations Section 1.860F-4(d) and Treasury Regulations Section 
301.6231(a)(7)-1.                                                               

Tax Service Contract: As defined in Section 3.09(a).    

           Telerate Page 3750: The display page currently so designated on the
Bridge Telerate Service (or such other page as may replace that page on that    
service for displaying comparable rates or prices).                             

           Total Monthly Excess Spread: As to any Distribution Date, an amount
equal to the excess if any, of (i) the interest on the Mortgage Loans received  
by the Servicers on or prior to the related Determination Date (other than      
Prepayment Interest Excesses) or advanced by the Servicers for the related      
Remittance Date (net of Expense Fees) over (ii) the sum of (A) the amounts      
payable to the Certificates pursuant to Section 4.02(a)(i) on such Distribution 
Date and (B) any Net Swap Payments to the Swap Provider.                        

          Transfer: Any direct or indirect transfer or sale of any Ownership
Interest in a Residual Certificate.                                             

Transfer Affidavit: As defined in Section 5.02(c).      

Transferor Certificate: As defined in Section 5.02(b).  

  Trigger Event: Either a Cumulative Loss Trigger Event or a
Delinquency Trigger Event.                                                      

      Trust: The express trust created hereunder in Section 2.01(c).

           Trust Fund: The corpus of the trust created hereunder consisting of
(i) the Mortgage Loans and all interest and principal with respect thereto      
received on or after the related Cut-off Date, other than such amounts which    
were due on the Mortgage Loans on or prior to the related Cut-off Date; (ii) the
Collection Accounts, Excess Reserve Fund Account, the Distribution Account, and 
all amounts deposited therein pursuant to the applicable provisions of this     
Agreement; (iii) property that secured a Mortgage Loan and has been acquired by 
foreclosure, deed-in-lieu of foreclosure or otherwise; (iv) the Closing Date    
Deposit Amount; (v) the Swap Assets; and (vii) all proceeds of the conversion,  
voluntary or involuntary, of any of the foregoing.                              

           Trust REMIC: Any of Pooling-Tier REMIC-1, Pooling-Tier REMIC-2, the
Lower-Tier REMIC or the Upper-Tier REMIC, as applicable.                        

         Trustee: Deutsche Bank National Trust Company, a national banking
association, and its successors in interest and, if a successor trustee is      
appointed hereunder, such successor.                                            

        Trustee Fee: As to any Distribution Date, an amount equal to the
product of (a) one-twelfth of the Trustee Fee Rate and (b) (i) the aggregate    
Stated Principal Balance of the Mortgage Loans as of the first day of the       
related Interest Accrual Period and (ii) with respect to the Distribution Date  
in February 2006 only, the portion of the Closing Date Deposit Amount allocable 
to principal.                                                                   

         Trustee Fee Rate: With respect to each Mortgage Loan, 0.0035% per
annum.                                                                          

           Trustee Float Period: With respect to the Distribution Date and the
related amounts in the Distribution Account, the period commencing on the       
Business Day immediately preceding such Distribution Date and ending on such    
Distribution Date.                                                              

          Underwriters' Exemption: Any exemption listed under footnote 1 of,
and amended by, Prohibited Transaction Exemption 2002-41, 67 Fed. Reg. 54487    
(2002), or any successor exemption.                                             

            Underwriting Guidelines: The underwriting guidelines attached to the
Purchase Agreement.                                                             

            Unpaid Interest Amount: As of any Distribution Date and any Class of
Certificates, the sum of (a) the portion of the Accrued Certificate Interest    
Distribution Amount from Distribution Dates prior to the current Distribution   
Date remaining unpaid immediately prior to the current Distribution Date and (b)
interest on the amount in clause (a) above at the applicable Pass-Through Rate  
(to the extent permitted by applicable law).                                    

 Unpaid Realized Loss Amount: With respect to any Class of
Subordinated Certificates and as to any Distribution Date, is the excess of (i) 
the Applied Realized Loss Amount with respect to such Class over (ii) the sum of
(a) all distributions in reduction of such Applied Realized Loss Amounts on all 
previous Distribution Dates, and (b) the amount by which the Class Certificate  
Balance of such Class has been increased due to the distribution of any         
Subsequent Recoveries on all previous Distribution Dates. Any amounts           
distributed to a Class of Subordinated Certificates in respect of any Unpaid    
Realized Loss Amount will not be applied to reduce the Class Certificate Balance
of such Class.                                                                  

     Upper-Tier CarryForward Amount: With respect to each Class of
Offered Certificates, as of any Distribution Date, the sum of (A) if on such    
Distribution Date the Upper-Tier Interest Rate for the Class of Corresponding   
Upper-Tier REMIC Regular Interest is based upon the Upper-Tier REMIC WAC Rate,  
the excess, if any, of (i) the amount of interest such Class of Upper-Tier      
Regular Interest would otherwise be entitled to receive on such Distribution    
Date had such Upper-Tier REMIC Regular Interest not been subject to the         
Upper-Tier REMIC WAC Rate, over (ii) the amount of interest payable on such     
Class of Certificates on such Distribution Date taking into account the         
Upper-Tier REMIC WAC Rate and (B) the Upper-Tier CarryForward Amount for such   
Class of Certificates for all previous Distribution Dates not previously paid,  
together with interest thereon at a rate equal to the applicable Upper-Tier     
Interest Rate for such Class of Certificates for such Distribution Date, without
giving effect to the Upper-Tier REMIC WAC Rate.                                 

            Upper-Tier Interest Rate: As described in the Preliminary Statement.

    Upper-Tier Regular Interest: As described in the Preliminary
Statement.                                                                      

    Upper-Tier REMIC: As described in the Preliminary Statement.

          Upper-Tier REMIC WAC Rate: For any Distribution Date, the weighted
average of the Lower-Tier Interest Rates on the Lower-Tier Regular Interests    
(other than the Class LT-IO Interest) as of the first day of the related        
Interest Accrual Period, weighted on the basis of the Lower-Tier Principal      
Amounts of such Lower-Tier Regular Interests as of the first day of the related 
Interest Accrual Period.                                                        

           U.S. Person: (i) A citizen or resident of the United States; (ii) a
corporation (or entity treated as a corporation for tax purposes) created or    
organized in the United States or under the laws of the United States or of any 
State thereof, including, for this purpose, the District of Columbia; (iii) a   
partnership (or entity treated as a partnership for tax purposes) organized in  
the United States or under the laws of the United States or of any State        
thereof, including, for this purpose, the District of Columbia (unless provided 
otherwise by future Treasury regulations); (iv) an estate whose income is       
includible in gross income for United States income tax purposes regardless of  
its source; or (v) a trust, if a court within the United States is able to      
exercise primary supervision over the administration of the trust and one or    
more U.S. Persons have authority to control substantial decisions of the trust. 
Notwithstanding the last clause of the preceding sentence, to the extent        
provided in Treasury regulations, certain trusts in existence on August 20,     
1996, and treated as U.S. Persons prior to such date, may elect to continue to  
be U.S. Persons.                                                                

     Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. As of any date of           
determination, (a) 1% of all Voting Rights shall be allocated to the Class X    
Certificates, if any (such Voting Rights to be allocated among the holders of   
Certificates of each such Class in accordance with their respective Percentage  
Interests), (b) 1% of all Voting Rights shall be allocated to the Class P       
Certificates, if any, and (c) the remaining Voting Rights shall be allocated    
among Holders of the remaining Classes of Certificates in proportion to the     
Certificate Balances of their respective Certificates on such date.             

          WAC Cap: With respect to the Mortgage Loans as of any Distribution
Date, the weighted average of the Adjusted Net Mortgage Rates then in effect on 
the beginning of the related Due Period on the Mortgage Loans minus the Swap    
Payment Rate, adjusted in each case to accrue on the basis of a 360-day year and
the actual number of days in the related Interest Accrual Period.               

ARTICLE II

 CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES

     Section 2.01 Conveyance of Mortgage Loans. (a) The Depositor,
concurrently with the execution and delivery hereof, hereby sells, transfers,   
assigns, sets over and otherwise conveys to the Trustee for the benefit of the  
Certificateholders, without recourse, all the right, title and interest of the  
Depositor in and to the Trust Fund, and the Trustee, on behalf of the Trust,    
hereby accepts the Trust Fund.                                                  

           (b) In connection with the transfer and assignment of each Mortgage
Loan, the Depositor has delivered or caused to be delivered to the Trustee for  
the benefit of the Certificateholders the following documents or instruments    
with respect to each Mortgage Loan so assigned:                                 

           (i) the original Mortgage Note bearing all intervening endorsements
   showing a complete chain of endorsement from the originator to the last
    endorsee, endorsed "Pay to the order of _____________, without recourse"
    and signed (which may be by facsimile signature) in the name of the last
     endorsee by an authorized officer. To the extent that there is no room on
the face of a Mortgage Note for endorsements, the endorsement may be
    contained on an allonge, unless the Trustee is advised in writing by the
Responsible Party, that state law does not so allow;                

         (ii) the original of any guaranty executed in connection with the
Mortgage Note;                                                      

           (iii) the original Mortgage with evidence of recording thereon or a
certified true copy of such Mortgage submitted for recording. If, in
connection with any Mortgage Loan, the original Mortgage cannot be  
   delivered 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 Responsible Party, shall deliver or cause to be
    delivered to the Trustee a photocopy of such Mortgage, together with (A)
      in the case of a delay caused by the public recording office, an officer's
    certificate of the Responsible Party or evidence of certification on the
   face of such photocopy of such Mortgage or a certificate from an escrow
   company, a title company or closing attorney 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 Trustee upon receipt thereof by the Responsible Party; or (B) 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 to be a true and complete copy
of the original recorded Mortgage;                                  

            (iv) the originals of all assumption, modification, consolidation or
   extension agreements, with evidence of recording thereon or a certified
true copy of such agreement submitted for recording;                

      (v) the original Assignment of Mortgage for each Mortgage Loan
endorsed in blank;                                                  

         (vi) the originals of all intervening assignments of Mortgage (if
any) evidencing a complete chain of assignment from the applicable  
   originator to the last endorsee with evidence of recording thereon or a
     certified true copy of such intervening assignments of Mortgage submitted
      for recording, 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 Responsible Party, shall deliver or cause to be delivered a photocopy
    of such intervening assignment, together with (A) in the case of a delay
  caused by the public recording office, an officer's certificate of the
Responsible Party or evidence of certification on the face of such  
    photocopy of such intervening assignment or a certificate from an escrow
company, a title company or a closing attorney 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 to be a true and complete copy of the original recorded intervening
 assignment of Mortgage will be promptly delivered to the Trustee upon
receipt thereof by the Responsible Party; or (B) 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;                                             

            (vii) the original mortgagee title insurance policy or, in the event
   such original title policy is unavailable, a certified true copy of the
  related policy binder or commitment for title certified to be true and
complete by the title insurance company; and                        

          (viii) the original of any security agreement, chattel mortgage or
equivalent document executed in connection with the Mortgage (if    
provided).                                                          

            The Responsible Party shall cause to be delivered to the Trustee the
applicable recorded document promptly upon receipt from the respective recording
office but in no event later than 120 days from the Closing Date.               

       From time to time, the Depositor or the applicable Servicer, as
applicable, shall forward to the Trustee, additional original documents,        
additional documents evidencing an assumption, modification, consolidation or   
extension of a Mortgage Loan, in accordance with the terms of this Agreement    
upon receipt of such documents. All such mortgage documents held by the Trustee 
as to each Mortgage Loan shall constitute the "Custodial File".                 

            On or prior to the Closing Date, the Responsible Party shall deliver
to the Trustee, Assignments of Mortgage, in blank, for each Mortgage Loan. The  
Responsible Party shall cause the Assignments of Mortgage and complete recording
information to be provided to the applicable Servicer in a reasonably acceptable
manner. No later than thirty (30) Business Days following the later of the      
Closing Date and the date of receipt by the applicable Servicer of the complete 
recording information for a Mortgage, the applicable Servicer shall promptly    
submit or cause to be submitted for recording, at the expense of the Responsible
Party and at no expense to the Trust Fund, the Trustee, the applicable Servicer,
or the Depositor, in the appropriate public office for real property records,   
each Assignment of Mortgage referred to in Section 2.01(b)(v). Notwithstanding  
the foregoing, however, for administrative convenience and facilitation of      
servicing and to reduce closing costs, the Assignments of Mortgage shall not be 
required to be completed and submitted for recording with respect to any        
Mortgage Loan (i) if the Trustee and each Rating Agency have received an Opinion
of Counsel, satisfactory in form and substance to the Trustee and each Rating   
Agency to the effect that the recordation of such Assignments of Mortgage in any
specific jurisdiction is not necessary to protect the Trustee's interest in the 
related Mortgage Note or (ii) the Rating Agencies have each notified the        
Depositor in writing that not recording any such Assignments of Mortgage would  
not cause the initial ratings on any Offered Certificates to be downgraded or   
withdrawn; provided, however, that no Servicer shall be held responsible or     
liable for any loss that occurs because an Assignment of Mortgage was not       
recorded, but only to the extent the applicable Servicer does not have prior    
knowledge of the act or omission that causes such loss. However, with respect to
the Assignments of Mortgage referred to in clauses (i) and (ii) above, if       
foreclosure proceedings occur against a Mortgaged Property, the Depositor shall 
notify the applicable Servicer and such Servicer shall record such Assignment of
Mortgage at the expense of the Responsible Party (at no expense to the          
applicable Servicer) as required pursuant to the Purchase Agreement. If the     
Assignment of Mortgage is to be recorded, the Mortgage shall be assigned to     
"Deutsche Bank National Trust Company, as trustee under the Pooling and         
Servicing Agreement dated as of January 1, 2006, Morgan Stanley ABS Capital I   
Inc. Trust 2006-NC1". In the event that any such Assignment of Mortgage is lost 
or returned unrecorded because of a defect therein, the Responsible Party shall 
promptly cause to be delivered a substitute Assignment of Mortgage to cure such 
defect and thereafter cause each such assignment to be duly recorded.           

         In the event that such original or copy of any document submitted
for recordation to the appropriate public recording office is not so delivered  
to the Trustee within 90 days following the Closing Date, and in the event that 
the Responsible Party does not cure such failure within 30 days of discovery or 
receipt of written notification of such failure from the Depositor, the related 
Mortgage Loan shall, upon the request of the Depositor, be repurchased by the   
Responsible Party at the price and in the manner specified in Section 2.03. The 
foregoing repurchase obligation shall not apply in the event that the           
Responsible Party cannot deliver such original or copy of any document submitted
for recordation to the appropriate public recording office within the specified 
period due to a delay caused by the recording office in the applicable          
jurisdiction; provided, that the Responsible Party shall instead deliver a      
recording receipt of such recording office or, if such recording receipt is not 
available, an officer's certificate of an officer of the Responsible Party,     
confirming that such document has been accepted for recording.                  

          Notwithstanding anything to the contrary contained in this Section
2.01, in those instances where the public recording office retains or loses the 
original Mortgage or assignment after it has been recorded, the obligations of  
the Responsible Party shall be deemed to have been satisfied upon delivery by   
the Responsible Party to the Trustee, prior to the Closing Date of a copy of    
such Mortgage or assignment, as the case may be, certified (such certification  
to be an original thereof) by the public recording office to be a true and      
complete copy of the recorded original thereof.                                 

        (c) The Depositor does hereby establish, pursuant to the further
provisions of this Agreement and the laws of the State of New York, an express  
trust (the "Trust") to be known, for convenience, as "MORGAN STANLEY ABS CAPITAL
I INC. TRUST 2006-NC1" and Deutsche Bank National Trust Company is hereby       
appointed as Trustee in accordance with the provisions of this Agreement. The   
parties hereto acknowledge and agree that it is the policy and intention of the 
Trust to acquire only Mortgage Loans meeting the requirements set forth in this 
Agreement, including without limitation, the representation and warranty set    
forth in paragraph (46) of Schedule III. The Trust's fiscal year is the calendar
year.                                                                           

           (d) The Trust shall have the capacity, power and authority, and the
Trustee on behalf of the Trust is hereby authorized, to accept the sale,        
transfer, assignment, set over and conveyance by the Depositor to the Trust of  
all the right, title and interest of the Depositor in and to the Trust Fund     
(including, without limitation, the Mortgage Loans) pursuant to Section 2.01(a).
The Trustee on behalf of the Trust is hereby directed to enter into the Interest
Rate Swap Agreement.                                                            

         Section 2.02 Acceptance by the Trustee of the Mortgage Loans. The
Trustee shall acknowledge, on the Closing Date, receipt by the Trustee, of the  
documents identified in the Initial Certification in the form annexed hereto as 
Exhibit E, and declares that it holds and will hold such documents and the other
documents delivered to it pursuant to Section 2.01, and that it holds or will   
hold such other assets as are included in the Trust Fund, in trust for the      
exclusive use and benefit of all present and future Certificateholders. The     
Trustee shall maintain possession of the related Mortgage Notes in the State of 
California unless otherwise permitted by the Rating Agencies.                   

          In connection with the Closing Date, the Trustee shall be required
to deliver via facsimile (with original to follow the next Business Day) to the 
Depositor and the Servicers an Initial Certification prior to the Closing Date, 
or, as the Depositor agrees to, on the Closing Date, certifying receipt of a    
Mortgage Note and Assignment of Mortgage for each applicable Mortgage Loan. The 
Trustee shall not be responsible to verify the validity, sufficiency or         
genuineness of any document in any Custodial File.                              

         Within 90 days after the Closing Date, the Trustee shall, for the
benefit of the Holders of the Certificates, ascertain that all documents        
identified in the Document Certification and Exception Report in the form       
attached hereto as Exhibit F are in its possession, and shall deliver to the    
Depositor and the Servicers a Document Certification and Exception Report, in   
the form annexed hereto as Exhibit F, to the effect that, as to each Mortgage   
Loan listed in the Mortgage Loan Schedule (other than any Mortgage Loan paid in 
full or any Mortgage Loan specifically identified in such certification as an   
exception and not covered by such certification): (i) all documents identified  
in the Document Certification and Exception Report and required to be reviewed  
by it are in its possession; (ii) such documents have been reviewed by it and   
appear regular on their face and relate to such Mortgage Loan; (iii) based on   
its examination and only as to the foregoing documents, the information set     
forth in items (1), (2), (7) and (9) of the Mortgage Loan Schedule and items    
(1), (9) and (17) of the Data Tape Information respecting such Mortgage Loan is 
correct; and (iv) each Mortgage Note has been endorsed as provided in Section   
2.01 of this Agreement. The Trustee shall not be responsible to verify the      
validity, sufficiency or genuineness of any document in any Custodial File.     

         The Trustee shall retain possession and custody of each Custodial
File in accordance with and subject to the terms and conditions set forth       
herein. The applicable Servicer shall promptly deliver to the Trustee, upon the 
execution or receipt thereof, the originals of such other documents or          
instruments constituting the Custodial File as come into the possession of the  
Servicer from time to time.                                                     

      The Responsible Party shall deliver to the applicable Servicer
copies of all trailing documents required to be included in the Custodial File  
at the same time the original or certified copies thereof are delivered to the  
Trustee, including but not limited to such documents as the title insurance     
policy and any other Mortgage Loan Documents upon return from the public        
recording office. Such documents shall be delivered by the Responsible Party at 
the Responsible Party's expense to such Servicer.                               

          Section 2.03 Representations and Warranties; Remedies for Breaches
of Representations and Warranties with Respect to the Mortgage Loans. (a) HomeEq
hereby makes the representations and warranties set forth in Schedule II hereto 
to the Depositor and the Trustee, as of the dates set forth in such Schedule and
JPMorgan hereby makes the representations and warranties set forth in Schedule  
IV hereto to the Depositor and the Trustee as of the dates set forth in such    
Schedule. Upon discovery by any of the parties hereto of a breach of any of the 
foregoing representations and warranties, the party discovering such breach     
shall give prompt written notice to the other.                                  

      (b) The Responsible Party hereby makes the representations and
warranties, set forth in Schedule III and Schedule V hereto, to the Depositor   
and the Trustee as of the dates set forth in such Schedules.                    

      (c) It is understood and agreed by the parties hereto that the
representations and warranties set forth in this Section 2.03 shall survive the 
transfer of the Mortgage Loans by the Depositor to the Trustee, and shall inure 
to the benefit of the parties to whom the representations and warranties were   
made 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 any of the Responsible Party, the Depositor,   
the Trustee or a Servicer of a breach of any of the foregoing representations   
and warranties, the party discovering such breach shall give prompt written     
notice to the others.                                                           

          (d) Within 30 days of the earlier of either discovery by or notice
to the Responsible Party that any Mortgage Loan does not conform to the         
requirements as determined in the Trustee's review of the related Custodial File
or within 60 days of the earlier of either discovery by or notice to the        
Responsible Party of any breach of a representation or warranty, set forth in   
Section 2.03(b), that materially and adversely affects the value of any Mortgage
Loan or the interest of the Trustee or the Certificateholders therein, the      
Responsible Party shall use its best efforts to cause to be remedied a material 
defect in a document constituting part of a Mortgage File or promptly to cure   
such breach in all material respects and, if such defect or breach cannot be    
remedied, the Responsible Party shall, at the Depositor's option as specified in
writing and provided to the Responsible Party and the Trustee, (i) if such 30 or
60 day period, as applicable, expires prior to the second anniversary of the    
Closing Date, remove such Mortgage Loan (a "Deleted Mortgage Loan") from the    
Trust Fund and substitute in its place a Substitute Mortgage Loan, in the manner
and subject to the conditions set forth in this Section 2.03; or (ii) repurchase
such Mortgage Loan at the Repurchase Price; provided, however, that any such    
substitution pursuant to clause (i) above shall not be effected prior to the    
delivery to the Trustee of a Request for Release substantially in the form of   
Exhibit J, and the delivery of the Mortgage File to the Trustee for any such    
Substitute Mortgage Loan. Notwithstanding the foregoing, a breach (i) which     
causes a Mortgage Loan not to constitute a "qualified mortgage" within the      
meaning of Section 860G(a)(3) of the Code or (ii) by the Responsible Party of   
any of the representations and warranties set forth in clause (46), (47), (49), 
(53), (55), (56), (57), (58), (59), (60), (61), (62) or (63) of Schedule III, in
each case, will be deemed automatically to materially and adversely affect the  
value of such Mortgage Loan and the interests of the Trustee and                
Certificateholders in such Mortgage Loan. In the event that the Trustee receives
notice of a breach by the Responsible Party of any of the representations and   
warranties set forth in clause (46), (47), (49), (53), (55), (56), (57), (58),  
(59), (60), (61), (62) or (63) of Schedule III, the Trustee shall give notice of
such breach to the Responsible Party and request the Responsible Party to       
repurchase the Mortgage Loan at the Repurchase Price within sixty (60) days of  
the Responsible Party receipt of such notice. The Responsible Party shall       
repurchase each such Mortgage Loan within 60 days of the earlier of discovery or
receipt of notice with respect to each such Mortgage Loan, and in any case such 
repurchase shall occur or shall be deemed to occur on the last day of the       
applicable Prepayment Period preceding the Distribution Date on which the       
Repurchase Price is to be distributed.                                          

      (e) With respect to any Substitute Mortgage Loan or Loans, the
Responsible Party shall deliver to the Trustee for the benefit of the           
Certificateholders the Mortgage Note, the Mortgage, the related Assignment of   
Mortgage, and such other documents and agreements as are required by Section    
2.01, with the Mortgage Note endorsed and the Mortgage assigned as required by  
Section 2.01. No substitution under this Agreement is permitted to be made in   
any calendar month after the Determination Date for such month. Scheduled       
Payments due with respect to Substitute Mortgage Loans in the Due Period of     
substitution shall not be part of the Trust Fund and will be retained by the    
Responsible Party on the next succeeding Distribution Date. For the Due Period  
of substitution, distributions to Certificateholders will include the Scheduled 
Payment due on any Deleted Mortgage Loan for such Due Period and thereafter the 
Responsible Party shall be entitled to retain all amounts received in respect of
such Deleted Mortgage Loan.                                                     

           (f) The applicable Servicer, based upon information provided by the
Responsible Party, shall amend the Mortgage Loan Schedule for the benefit of the
Certificateholders to reflect the removal of such Deleted Mortgage Loan and the 
substitution of the Substitute Mortgage Loan or Loans and such Servicer shall   
deliver the amended Mortgage Loan Schedule to the Trustee. Upon such            
substitution, the Substitute Mortgage Loan or Loans shall be subject to the     
terms of this Agreement in all respects, and the Responsible Party shall be     
deemed to have made with respect to such Substitute Mortgage Loan or Loans, as  
of the date of substitution, the representations and warranties made pursuant to
Section 2.03(b) with respect to such Mortgage Loan. Upon any such substitution  
and the deposit into the related Collection Account of the amount required to be
deposited therein in connection with such substitution as described in the      
following paragraph, the Trustee shall release the Mortgage File held for the   
benefit of the Certificateholders relating to such Deleted Mortgage Loan to the 
Responsible Party and shall execute and deliver at the Responsible Party's      
direction such instruments of transfer or assignment prepared by the Responsible
Party, in each case without recourse, as shall be necessary to vest title in the
Responsible Party, of the Trustee's interest in any Deleted Mortgage Loan       
substituted for pursuant to this Section 2.03.                                  

           (g) For any month in which the Responsible Party substitutes one or
more Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the      
applicable Servicer will determine the amount (if any) by which the aggregate   
unpaid principal balance of all such Substitute Mortgage Loans as of the date of
substitution is less than the aggregate unpaid principal balance of all such    
Deleted Mortgage Loans. The amount of such shortage plus an amount equal to the 
sum of (i) any accrued and unpaid interest on the Deleted Mortgage Loans and    
(ii) all unreimbursed Servicing Advances with respect to such Deleted Mortgage  
Loans (collectively, the "Substitution Adjustment Amount") shall be remitted by 
the Responsible Party to the applicable Servicer for deposit into the related   
Collection Account on or before the Distribution Account Deposit Date for the   
Distribution Date following the Prepayment Period during which the related      
Mortgage Loan became required to be purchased or replaced hereunder.            

          (h) In addition to such repurchase or substitution obligation, the
Responsible Party shall indemnify the Depositor and its Affiliates, the         
Servicers, the Sponsor, the Trustee and the Trust and hold such parties 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 by the Responsible Party of any of its        
representations and warranties or obligations contained in this Agreement.      

            (i) In the event that the Responsible Party shall have repurchased a
Mortgage Loan pursuant to this Agreement, the Repurchase Price therefor shall be
deposited by the applicable Servicer in the applicable Collection Account of the
related Servicer pursuant to Section 3.10 on or before the Distribution Account 
Deposit Date for the Distribution Date following the Prepayment Period during   
which the Responsible Party, as applicable, repurchased such Mortgage Loan and  
upon such deposit of the Repurchase Price and receipt of a Request for Release  
in the form of Exhibit J hereto, the Trustee shall release the related Custodial
File held for the benefit of the Certificateholders to such Person as directed  
by the applicable Servicer, and the Trustee shall execute and deliver at such   
Person's direction such instruments of transfer or assignment prepared by such  
Person, in each case without recourse, as shall be necessary to transfer title  
from the Trustee.                                                               

  It is understood and agreed by the parties hereto that the
obligation of the Responsible Party under this Agreement to cure, repurchase or 
substitute any Mortgage Loan as to which a breach of a representation and       
warranty has occurred and is continuing, together with any related              
indemnification obligations of the Responsible Party set forth in Section       
2.03(h), shall constitute the sole remedies against such Person respecting such 
breach available to Certificateholders, the Depositor (if applicable), the      
Servicer or the Trustee.                                                        

         The provisions of this Section 2.03 shall survive delivery of the
respective Custodial Files to the Trustee for the benefit of the                
Certificateholders.                                                             

        Section 2.04 Execution and Delivery of Certificates. The Trustee
acknowledges the transfer and assignment to it of the Trust Fund and,           
concurrently with such transfer and assignment, has executed and delivered to or
upon the order of the Depositor, the Certificates in authorized Denominations   
evidencing directly or indirectly the entire ownership of the Trust Fund. The   
Trustee agrees to hold the Trust Fund and exercise the rights referred to above 
for the benefit of all present and future Holders of the Certificates.          

            Section 2.05 REMIC Matters. The Preliminary Statement sets forth the
designations for federal income tax purposes of all interests created hereby.   
The "Startup Day" for purposes of the REMIC Provisions shall be the Closing     
Date. The "latest possible maturity date" is the Distribution Date occurring in 
December 2035, which is the Distribution Date in the month following the month  
in which the latest maturity date of any Mortgage Loan occurs. Amounts          
distributable to the Class X Certificates (prior to any reduction for any Basis 
Risk Payment or Swap Termination Payment), exclusive of any amounts received    
from the Swap Provider, shall be deemed paid from the Upper-Tier REMIC in       
respect of the Class X Interest to the Holders of the Class X Certificates prior
to distribution of any Basis Risk Payments to the Offered Certificates. For     
federal income tax purposes, any amount distributed on the Offered Certificates 
on any Distribution Date in excess of the amount distributable on their         
Corresponding Class of Upper-Tier Regular Interest on such Distribution Date    
shall be treated as having been paid from the Excess Reserve Fund Account or the
Swap Account, as applicable, and any amount distributable on such Corresponding 
Class of Upper-Tier Regular Interest on such Distribution Date in excess of the 
amount distributable on the Corresponding Class of Offered Certificates on such 
Distribution Date shall be treated as having been paid to the Excess Reserve    
Fund Account or the Swap Account, all pursuant to and as further provided in    
Section 8.13.                                                                   

         Section 2.06 Representations and Warranties of the Depositor. The
Depositor hereby represents, warrants and covenants to the Trustee and the      
Servicers that as of the date of this Agreement or as of such date specifically 
provided herein:                                                                

           (a) The Depositor is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware;                   

         (b) The Depositor has the corporate power and authority to convey
the Mortgage Loans and to execute, deliver and perform, and to enter into and   
consummate the transactions contemplated by, this Agreement;                    

         (c) This Agreement has been duly and validly authorized, executed
and delivered by the Depositor, all requisite corporate action having been      
taken, and, assuming the due authorization, execution and delivery hereof by the
other parties hereto, constitutes or will constitute the legal, valid and       
binding agreement of the Depositor, enforceable against the Depositor in        
accordance with its terms, except as such enforcement may be limited by         
bankruptcy, insolvency, reorganization, moratorium or other similar laws        
relating to or affecting the rights of creditors generally, and by general      
equity principles (regardless of whether such enforcement is considered in a    
proceeding in equity or at law);                                                

           (d) No consent, approval, authorization or order of or registration
or filing with, or notice to, any governmental authority or court is required   
for the execution, delivery and performance of or compliance by the Depositor   
with this Agreement or the consummation by the Depositor of any of the          
transactions contemplated hereby, except as have been made on or prior to the   
Closing Date;                                                                   

     (e) None of the execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby or thereby, or the         
fulfillment of or compliance with the terms and conditions of this Agreement,   
(i) conflicts or will conflict with or results or will result in a breach of, or
constitutes or will constitute a default or results or will result in an        
acceleration under (A) the charter or bylaws of the Depositor, or (B) of any    
term, condition or provision of any material indenture, deed of trust, contract 
or other agreement or instrument to which the Depositor or any of its           
subsidiaries is a party or by which it or any of its subsidiaries is bound; (ii)
results or will result in a violation of any law, rule, regulation, order,      
judgment or decree applicable to the Depositor of any court or governmental     
authority having jurisdiction over the Depositor or its subsidiaries; or (iii)  
results in the creation or imposition of any lien, charge or encumbrance which  
would have a material adverse effect upon the Mortgage Loans or any documents or
instruments evidencing or securing the Mortgage Loans;                          

           (f) There are no actions, suits or proceedings before or against or
investigations of, the Depositor pending, or to the knowledge of the Depositor, 
threatened, before any court, administrative agency or other tribunal, and no   
notice of any such action, which, in the Depositor's reasonable judgment, might 
materially and adversely affect the performance by the Depositor of its         
obligations under this Agreement, or the validity or enforceability of this     
Agreement;                                                                      

        (g) The Depositor is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal, state,   
municipal or governmental agency that may materially and adversely affect its   
performance hereunder; and                                                      

   (h) Immediately prior to the transfer and assignment by the
Depositor to the Trustee on the Closing Date, the Depositor had good title to,  
and was the sole owner of each Mortgage Loan, free of any interest of any other 
Person, and the Depositor has transferred all right, title and interest in each 
Mortgage Loan to the Trustee. The transfer of the Mortgage Note and the Mortgage
as and in the manner contemplated by this Agreement is sufficient either (i)    
fully to transfer to the Trustee, for the benefit of the Certificateholders, all
right, title, and interest of the Depositor thereto as note holder and mortgagee
or (ii) to grant to the Trustee, for the benefit of the Certificateholders, the 
security interest referred to in Section 10.04.                                 

            It is understood and agreed that the representations, warranties and
covenants set forth in this Section 2.06 shall survive delivery of the          
respective Custodial Files to the Trustee and shall inure to the benefit of the 
Trustee.                                                                        

 ARTICLE III

ADMINISTRATION AND SERVICING
 OF MORTGAGE LOANS

        Section 3.01 Servicers to Service Mortgage Loans. (a) For and on
behalf of the Certificateholders, each Servicer shall service and administer the
Mortgage Loans for which it is acting as Servicer in accordance with the terms  
of this Agreement and the respective Mortgage Loans and, to the extent          
consistent with such terms, in the same manner in which it services and         
administers similar mortgage loans for its own portfolio, giving due            
consideration to customary and usual standards of practice of mortgage lenders  
and loan servicers administering similar mortgage loans but without regard to:  

       (i) any relationship that such Servicer, any Subservicer or any
Affiliate of such Servicer or any Subservicer may have with the related         
Mortgagor;                                                                      

      (ii) the ownership or non ownership of any Certificate by such
Servicer or any Affiliate of such Servicer;                                     

          (iii) such Servicer's obligation to make P&I Advances or Servicing
Advances; or                                                                    

  (iv) such Servicer's or any Subservicer's right to receive
compensation for its services hereunder or with respect to any particular       
transaction.                                                                    

        To the extent consistent with the foregoing, each Servicer shall
seek to maximize the timely and complete recovery of principal and interest on  
the Mortgage Notes. Subject only to the above described servicing standards and 
the terms of this Agreement and of the respective Mortgage Loans, each Servicer 
shall have full power and authority, acting alone or through Subservicers as    
provided in Section 3.02, to do or cause to be done any and all things in       
connection with such servicing and administration which it may deem necessary or
desirable. Without limiting the generality of the foregoing, each Servicer in   
its own name or in the name of a Subservicer is hereby authorized and empowered 
by the Trustee when the applicable Servicer believes it appropriate in its best 
judgment in accordance with Accepted Servicing Practices, to execute and deliver
any and all instruments of satisfaction or cancellation, or of partial or full  
release or discharge, and all other comparable instruments, with respect to the 
Mortgage Loans and the Mortgaged Properties and to institute foreclosure        
proceedings or obtain a deed in lieu of foreclosure so as to convert the        
ownership of such properties, and to hold or cause to be held title to such     
properties, on behalf of the Trustee. Each Servicer shall service and administer
the Mortgage Loans in accordance with applicable state and federal law and shall
provide to the Mortgagors any reports required to be provided to them thereby.  
Each Servicer covenants that its computer and other systems used in servicing   
the Mortgage Loans operate in a manner such that the Servicer can service the   
Mortgage Loans in accordance with the terms of this Pooling and Servicing       
Agreement. Each Servicer shall also comply in the performance of this Agreement 
with all reasonable rules and requirements of each insurer under any standard   
hazard insurance policy. Subject to Section 3.16, the Trustee shall execute, at 
the written request of a Servicer, and furnish to such Servicer and any         
Subservicer such documents provided to the Trustee as are necessary or          
appropriate to enable such Servicer or any Subservicer to carry out its         
servicing and administrative duties hereunder, and the Trustee hereby grants to 
each Servicer, and this Agreement shall constitute, a power of attorney to carry
out such duties, including a power of attorney in the form of Exhibit O hereto  
to take title to Mortgaged Properties after foreclosure in the name of and on   
behalf of the Trustee. The Trustee shall execute a separate power of attorney in
favor of each Servicer for the purposes described herein to the extent necessary
or desirable to enable each Servicer to perform its duties hereunder. The       
Trustee shall not be liable for the actions of any Servicer or any Subservicers 
under such powers of attorney. Notwithstanding anything contained herein to the 
contrary, no Servicer or Subservicer shall without the Trustee's consent: (i)   
initiate any action, suit or proceeding solely under the Trustee's name without 
indicating such Servicer's or Subservicer's, as applicable, representative      
capacity, or (ii) take any action with the intent to, or which actually does    
cause, the Trustee to be registered to do business in any state.                

           (b) Subject to Section 3.09(b), in accordance with the standards of
the preceding paragraph, each Servicer shall advance or cause to be advanced    
funds as necessary for the purpose of effecting the timely payment of taxes and 
assessments on the Mortgaged Properties, which advances shall be Servicing      
Advances reimbursable in the first instance from related collections from the   
Mortgagors pursuant to Section 3.09(b), and further as provided in Section 3.11.
Any cost incurred by a Servicer or by Subservicers in effecting the timely      
payment of taxes and assessments on a Mortgaged Property shall not be added to  
the unpaid principal balance of the related Mortgage Loan, notwithstanding that 
the terms of such Mortgage Loan so permit.                                      

         (c) Notwithstanding anything in this Agreement to the contrary, a
Servicer may not make any future advances with respect to a Mortgage Loan       
(except as provided in Section 4.01) and neither Servicer shall (i) permit any  
modification with respect to any Mortgage Loan that would change the Mortgage   
Rate, reduce or increase the principal balance (except for reductions resulting 
from actual payments of principal) or change the final maturity date on such    
Mortgage Loan (except for a reduction of interest payments resulting from the   
application of the Servicemembers Civil Relief Act or any similar state         
statutes) or (ii) permit any modification, waiver or amendment of any term of   
any Mortgage Loan that would both (A) effect an exchange or reissuance of such  
Mortgage Loan under Section 1001 of the Code (or final, temporary or proposed   
Treasury regulations promulgated thereunder) and (B) cause any Trust REMIC to   
fail to qualify as a REMIC under the Code or the imposition of any tax on       
"prohibited transactions" or "contributions after the startup date" under the   
REMIC Provisions, or (iii) except as provided in Section 3.07(a), waive any     
Prepayment Charges.                                                             

      (d) Each Servicer may delegate its responsibilities under this
Agreement; provided, however, that no such delegation shall release that        
Servicer from the responsibilities or liabilities arising under this Agreement. 

         (e) In the event that the Mortgage Loan Documents relating to any
Mortgage Loan contain provisions requiring the related Mortgagor to submit to   
binding arbitration with respect to any disputes arising in connection with such
Mortgage Loan, the applicable Servicer shall be entitled to waive any such      
provisions on behalf of the Trust and to send written notice of such waiver to  
the related Mortgagor, although the Mortgagor may still require arbitration of  
such disputes at its option.                                                    

   Section 3.02 Subservicing Agreements between a Servicer and
Subservicers. (a) Each Servicer may enter into subservicing agreements with     
Subservicers for the servicing and administration of the Mortgage Loans         
("Subservicing Agreements"). Each Servicer represents and warrants to the other 
parties hereto that, except as otherwise set forth herein, no Subservicing      
Agreement is in effect as of the Closing Date with respect to any Mortgage Loans
required to be serviced by it hereunder. The applicable Servicer shall give     
notice to the Depositor and the Trustee of any such Subservicer and Subservicing
Agreement, which notice shall contain all information (including without        
limitation a copy of the Subservicing Agreement) reasonably necessary to enable 
the Trustee, pursuant to Section 8.12(g), to accurately and timely report the   
event under Item 6.02 of Form 8-K pursuant to the Exchange Act (if such reports 
under the Exchange Act are required to be filed under the Exchange Act). No     
Subservicing Agreement shall be effective until 30 days after such written      
notice is received by both the Depositor and the Trustee. The Trustee shall not 
be required to review or consent to such Subservicing Agreements and shall have 
no liability in connection therewith.                                           

            (b) Each Subservicer shall be (i) authorized to transact business in
the state or states in which the related Mortgaged Properties it is to service  
are situated, if and to the extent required by applicable law to enable the     
Subservicer to perform its obligations hereunder and under the Subservicing     
Agreement, (ii) an institution approved as a mortgage loan originator by the    
Federal Housing Administration or an institution that has deposit accounts      
insured by the FDIC and (iii) a Freddie Mac or Fannie Mae approved mortgage     
servicer. Each Subservicing Agreement must impose on the Subservicer            
requirements conforming to the provisions set forth in Section 3.08 and provide 
for servicing of the Mortgage Loans consistent with the terms of this Agreement.
Each Servicer will examine each Subservicing Agreement to which it is a party   
and will be familiar with the terms thereof. The terms of any Subservicing      
Agreement will not be inconsistent with any of the provisions of this Agreement.
Each Servicer and the respective Subservicers may enter into and make amendments
to the Subservicing Agreements or enter into different forms of Subservicing    
Agreements; provided, however, that any such amendments or different forms shall
be consistent with and not violate the provisions of this Agreement, and that no
such amendment or different form shall be made or entered into which could be   
reasonably expected to be materially adverse to the interests of the Trustee,   
without the consent of the Trustee. Any variation without the consent of the    
Trustee from the provisions set forth in Section 3.08 relating to insurance or  
priority requirements of Subservicing Accounts, or credits and charges to the   
Subservicing Accounts or the timing and amount of remittances by the            
Subservicers to such Servicer, are conclusively deemed to be inconsistent with  
this Agreement and therefore prohibited. Each Servicer shall deliver to the     
Trustee and the Depositor copies of all Subservicing Agreements, and any        
amendments or modifications thereof, promptly upon such Servicer's execution and
delivery of such instruments.                                                   

        (c) As part of its servicing activities hereunder, each Servicer
(except as otherwise provided in the last sentence of this paragraph), for the  
benefit of the Trustee, shall enforce the obligations of each Subservicer under 
the related Subservicing Agreement to which such Servicer is a party, including,
without limitation, any obligation to make advances in respect of delinquent    
payments as required by a Subservicing Agreement. Such enforcement, including,  
without limitation, the legal prosecution of claims, termination of Subservicing
Agreements, and the pursuit of other appropriate remedies, shall be in such form
and carried out to such an extent and at such time as such Servicer, in its good
faith business judgment, would require were it the owner of the related Mortgage
Loans. Each Servicer shall pay the costs of such enforcement at its own expense,
and shall be reimbursed therefor only (i) from a general recovery resulting from
such enforcement, to the extent, if any, that such recovery exceeds all amounts 
due in respect of the related Mortgage Loans or (ii) from a specific recovery of
costs, expenses or attorneys' fees against the party against whom such          
enforcement is directed.                                                        

     (d) Each Servicer shall cause any Subservicer engaged by such
Servicer (or by any Subservicer) for the benefit of the Depositor and the       
Trustee to comply with the provisions of this Section 3.02 and with Sections    
3.22, 3.23, 6.02 and 6.05 of this Agreement to the same extent as if such       
Subservicer were such Servicer, and to provide the information required with    
respect to such Subservicer under Section 8.12(f) of this Agreement. Such       
Servicer shall be responsible for obtaining from each such Subservicer and      
delivering to applicable Persons any servicer compliance statement required to  
be delivered by such Subservicer under Section 3.22 and any assessment of       
compliance report and related accountant's attestation required to be delivered 
by such Subservicer under Section 3.23, in each case as and when required to be 
delivered.                                                                      

        (e) Subject to the conditions set forth in this Section 3.02(e),
each Servicer and any Subservicer engaged by such Servicer is permitted to      
utilize one or more Subcontractors to perform certain of its obligations        
hereunder. Such Servicer shall promptly upon request provide to the Depositor a 
written description (in form and substance satisfactory to the Depositor) of the
role and function of each Subcontractor utilized by such Servicer or any such   
Subservicer, specifying, not later than the date specified for delivery of the  
annual report on assessment of compliance set forth in Section 3.23(d), (i) the 
identity of each such Subcontractor, if any, that is "participating in the      
servicing function" within the meaning of Item 1122 of Regulation AB, and (ii)  
which elements of the Servicing Criteria will be addressed in assessments of    
compliance provided by each Subcontractor identified pursuant to clause (i) of  
this paragraph. As a condition to the utilization by such Servicer or any such  
Subservicer of any Subcontractor determined to be "participating in the         
servicing function" within the meaning of Item 1122 of Regulation AB, such      
Servicer shall cause any such Subcontractor used by such Servicer (or by any    
such Subservicer) for the benefit of the Depositor and the Trustee to comply    
with the provisions of Section 3.23 of this Agreement to the same extent as if  
such Subcontractor were such Servicer. Such Servicer shall be responsible for   
obtaining from each such Subcontractor and delivering to the applicable Persons 
any assessment of compliance report and related accountant's attestation        
required to be delivered by such Subcontractor under Section 3.23, in each case 
as and when required to be delivered.                                           

            Notwithstanding the foregoing, if a Servicer engages a Subcontractor
in connection with the performance of any of its duties under this Agreement,   
such Servicer shall be responsible for determining whether such Subcontractor is
a "servicer" within the meaning of Item 1101 of Regulation AB and whether any   
such affiliate or third-party vendor meets the criteria in Item 1108(a)(2)(i)   
through (iii) of Regulation AB. If a Servicer determines, pursuant to the       
preceding sentence, that such Subcontractor is a "servicer" within the meaning  
of Item 1101 of Regulation AB and meets the criteria in Item 1108(a)(2)(i)      
through (iii) of Regulation AB, then such Subcontractor shall be deemed to be a 
Subservicer for purposes of this Agreement, the engagement of such Subservicer  
shall not be effective unless and until notice is given pursuant to Section     
3.02(a) and such Servicer shall comply with Section 3.02(d) with respect        
thereto.                                                                        

     (f) As of the Closing Date, JPMorgan has appointed Chase Home
Finance LCC ("CHF") to act as the sole Subservicer pursuant to a Subservicing   
Agreement (a copy of which is attached hereto as Exhibit V) with respect to     
JPMorgan's servicing obligations under this Agreement. So long as JPMorgan is   
not a rated servicer by each Rating Agency, JPMorgan agrees that prior to       
replacing CHF as Subservicer, other than with an affiliate of JPMorgan that is a
rated servicer, it will obtain confirmation from each Rating Agency that such   
replacement of CHF as Subservicer with respect to JPMorgan's servicing          
obligations related to the Mortgage Loans will not cause the then current rating
on any Class of Certificates to be qualified, withdrawn or lowered by any Rating
Agency and agrees that any replacement subservicer shall agree to subservice in 
accordance with the terms of this Agreement, including but not limited to the   
consideration of whether to waive a Prepayment Charge hereunder.                

            Section 3.03 Successor Subservicers. Each Servicer shall be entitled
to terminate any Subservicing Agreement to which such Servicer is a party and   
the rights and obligations of any Subservicer pursuant to any such Subservicing 
Agreement in accordance with the terms and conditions of such Subservicing      
Agreement; provided, however, that the termination, resignation or removal of a 
Subservicer shall be not be effective until 30 days after written notice is     
received by both the Depositor and the Trustee that contains all information    
reasonably necessary to enable the Trustee, pursuant to Section 8.12(g), to     
accurately and timely report the event under Item 6.02 of Form 8-K pursuant to  
the Exchange Act (if such reports under the Exchange Act are required to be     
filed under the Exchange Act). In the event of termination of any Subservicer,  
all servicing obligations of such Subservicer shall be assumed simultaneously by
the applicable Servicer party to the related Subservicing Agreement without any 
act or deed on the part of such Subservicer or such Servicer, and such Servicer 
either shall service directly the related Mortgage Loans or shall enter into a  
Subservicing Agreement with a successor Subservicer which qualifies under       
Section 3.02.                                                                   

        Any Subservicing Agreement shall include the provision that such
agreement may be immediately terminated by the Depositor or the Trustee without 
fee, in accordance with the terms of this Agreement, in the event that the      
Servicer party to the related Subservicing Agreement shall, for any reason, no  
longer be a Servicer (including termination due to an Event of Default).        

    Section 3.04 Liability of the Servicers. Notwithstanding any
Subservicing Agreement, any of the provisions of this Agreement relating to     
agreements or arrangements between a Servicer and a Subservicer or reference to 
actions taken through a Subservicer or otherwise, such Servicer shall remain    
obligated and primarily liable to the Trustee for the servicing and             
administering of the Mortgage Loans in accordance with the provisions of Section
3.01 without diminution of such obligation or liability by virtue of such       
Subservicing Agreements or arrangements or by virtue of indemnification from the
Subservicer and to the same extent and under the same terms and conditions as if
such Servicer alone were servicing and administering such Mortgage Loans. Each  
Servicer shall be entitled to enter into any agreement with a Subservicer for   
indemnification of such Servicer by such Subservicer and nothing contained in   
this Agreement shall be deemed to limit or modify such indemnification.         

         Section 3.05 No Contractual Relationship between Subservicers and
the Trustee. Any Subservicing Agreement that may be entered into and any        
transactions or services relating to the Mortgage Loans involving a Subservicer 
in its capacity as such shall be deemed to be between the Subservicer and the   
related Servicer alone, and the Trustee (or any successor to such servicer)     
shall not be deemed a party thereto and shall have no claims, rights,           
obligations, duties or liabilities with respect to the Subservicer except as set
forth in Section 3.06. Each Servicer shall be solely liable for all fees owed by
it to any Subservicer, irrespective of whether such Servicer's compensation     
pursuant to this Agreement is sufficient to pay such fees.                      

            Section 3.06 Assumption or Termination of Subservicing Agreements by
Trustee. In the event a Servicer at any time shall for any reason no longer be a
Servicer (including by reason of the occurrence of an Event of Default), the    
Trustee, or its designee, or the successor servicer if the successor is not the 
Trustee, shall thereupon assume all of the rights and obligations of such       
Servicer under each Subservicing Agreement that such Servicer may have entered  
into, with copies thereof provided to the Trustee, or the successor servicer if 
the successor is not the Trustee, prior to the Trustee, or the successor        
servicer if the successor is not the Trustee, assuming such rights and          
obligations, unless the Trustee elects to terminate any Subservicing Agreement  
in accordance with its terms as provided in Section 3.03.                       

        Upon such assumption, the Trustee, its designee or the successor
Servicer shall be deemed, subject to Section 3.03, to have assumed all of such  
Servicer's interest therein and to have replaced such Servicer as a party to    
each Subservicing Agreement to which the predecessor servicer was a party to the
same extent as if each Subservicing Agreement had been assigned to the assuming 
party, except that (i) such Servicer shall not thereby be relieved of any       
liability or obligations under any such Subservicing Agreement that arose before
it ceased to be a Servicer and (ii) none of the Depositor, the Trustee, their   
designees or any successor to such Servicer shall be deemed to have assumed any 
liability or obligation of such servicer that arose before it ceased to be a    
Servicer.                                                                       

            Such servicer at its expense shall, upon request of the Trustee, its
designee or the successor Servicer deliver to the assuming party all documents  
and records relating to each Subservicing Agreement to which it is a party and  
the Mortgage Loans then being serviced by it and an accounting of amounts       
collected and held by or on behalf of it, and otherwise use its best efforts to 
effect the orderly and efficient transfer of the Subservicing Agreements to the 
assuming party.                                                                 

           Section 3.07 Collection of Certain Mortgage Loan Payments. (a) Each
Servicer shall make reasonable efforts to collect all payments called for under 
the terms and provisions of the Mortgage Loans, and shall, to the extent such   
procedures shall be consistent with this Agreement and the terms and provisions 
of any applicable Insurance Policies, follow such collection procedures as it   
would follow with respect to mortgage loans comparable to the Mortgage Loans and
held for its own account. Consistent with the foregoing and Accepted Servicing  
Practices, each Servicer may (i) waive any late payment charge or, if           
applicable, any penalty interest, or (ii) extend the Due Dates for the Scheduled
Payments due on a Mortgage Note for a period of not greater than 180 days;      
provided that any extension pursuant to clause (ii) above shall not affect the  
amortization schedule of any Mortgage Loan for purposes of any computation      
hereunder, except as provided below. In the event of any such arrangement       
pursuant to clause (ii) above, the applicable Servicer shall make timely        
advances on such Mortgage Loan during such extension pursuant to Section 4.01   
and in accordance with the amortization schedule of such Mortgage Loan without  
modification thereof by reason of such arrangements, subject to Section 4.01(d) 
pursuant to which such Servicer shall not be required to make any such advances 
that are Nonrecoverable P&I Advances. Notwithstanding the foregoing, a Servicer 
may waive, or permit a Subservicer to waive, in whole or in part, a Prepayment  
Charge only under the following circumstances: (i) such waiver relates to a     
default or a reasonably foreseeable default and would, in the reasonable        
judgment of such Servicer, maximize recovery of total proceeds taking into      
account the value of such Prepayment Charge and the related Mortgage Loan, (ii) 
such Prepayment Charge is not permitted to be collected by applicable federal,  
state or local law or regulation or (iii) the collection of such Prepayment     
Charge would be considered "predatory" pursuant to written guidance published or
issued by any applicable federal, state or local regulatory authority acting in 
its official capacity and having jurisdiction over such matters. If a Prepayment
Charge is waived other than as permitted by the prior sentence, then the        
applicable Servicer is required to pay the amount of such waived Prepayment     
Charge, for the benefit of the Holders of the Class P Certificates, by          
depositing such amount into the related Collection Account together with and at 
the time that the amount prepaid on the related Mortgage Loan is required to be 
deposited into the Collection Account; provided, however, that the applicable   
Servicer shall not have an obligation to pay the amount of any uncollected      
Prepayment Charge if the failure to collect such amount is the direct result of 
inaccurate or incomplete information on the Mortgage Loan Schedule in effect at 
such time.                                                                      

           (b) (i) The Trustee shall establish and maintain the Excess Reserve
Fund Account, on behalf of the Class X Certificateholders, to receive any Basis 
Risk Payment and to secure their limited recourse obligation to pay to the      
Offered Certificateholders Basis Risk CarryForward Amounts (prior to using any  
Net Swap Receipts). For the avoidance of doubt, any Basis Risk CarryForward     
Amounts shall be paid to the Offered Certificates first from the Excess Reserve 
Fund Account and then from the Swap Account.                                    

            (ii) On each Distribution Date, the Trustee shall deposit the amount
of any Basis Risk Payment for such date into the Excess Reserve Fund
Account.                                                            

            (c) (i) On each Distribution Date on which there exists a Basis Risk
CarryForward Amount on any Class of Certificates, the Trustee shall (1)         
withdraw from the Distribution Account and deposit in the Excess Reserve Fund   
Account, as set forth in Section 4.02(a)(iii)(S), the lesser of (x) the Class X 
Distributable Amount (without regard to the reduction in clause (iii) in the    
definition thereof) (to the extent remaining after the distributions specified  
in Sections 4.02(a)(iii)(A)-(R)) and (y) the aggregate Basis Risk CarryForward  
Amounts for such Distribution Date and (2) withdraw from the Excess Reserve Fund
Account amounts necessary to pay to such Class or Classes of Certificates the   
Basis Risk CarryForward Amount. Such payments, along with payments from the     
Swap Account, shall be allocated to those Classes on a pro rata basis based upon
the amount of Basis Risk CarryForward Amount owed to each such Class and shall  
be paid in the priority set forth in Section 4.02(a)(iii)(T).                   

          (ii) The Trustee shall account for the Excess Reserve Fund Account
      as an asset of a grantor trust under subpart E, Part I of the subchapter J
     of the Code and not an asset of any Trust REMIC. The beneficial owners of
   the Excess Reserve Fund Account are the Class X Certificateholders. For
    all federal tax purposes, amounts transferred by the Upper Tier REMIC to
    the Excess Reserve Fund Account shall be treated as distributions by the
Trustee to the Class X Certificateholders.                          

        (iii) Any Basis Risk CarryForward Amounts paid by the Trustee to
   the Offered Certificateholders shall be accounted for by the Trustee as
     amounts paid first to the Holders of the Class X Certificates and then to
     the respective Class or Classes of Offered Certificates. In addition, the
Trustee shall account for the Offered Certificateholders' rights to 
    receive payments of Basis Risk CarryForward Amounts (along with payments
  of Basis Risk CarryForward Amounts and Upper-Tier CarryForward Amounts
    from the Swap Account) as rights in a limited recourse interest rate cap
    contract written by the Class X Certificateholders in favor of the LIBOR
Certificateholders.                                                 

           (iv) Notwithstanding any provision contained in this Agreement, the
      Trustee shall not be required to make any payments from the Excess Reserve
  Fund Account except as expressly set forth in this Section 3.07(c) and
Sections 4.02(a)(iii)(T) and (V).                                   

     (d) The Trustee shall establish and maintain the Distribution
Account on behalf of the Certificateholders. The Depositor shall cause to be    
deposited into the Distribution Account on the Closing Date the Closing Date    
Deposit Amount. The Trustee shall, promptly upon receipt, deposit in the        
Distribution Account and retain therein the following:                          

         (i) the aggregate amount remitted by the Servicers to the Trustee
pursuant to Section 3.11;                                           

      (ii) any amount deposited by the Servicers pursuant to Section
3.12(b) in connection with any losses on Permitted Investments; and 

            (iii) any other amounts deposited hereunder which are required to be
deposited in the Distribution Account.                              

          In the event that any Servicer shall remit any amount not required
to be remitted, it may at any time direct the Trustee in writing to withdraw    
such amount from the Distribution Account, any provision herein to the contrary 
notwithstanding. Such direction may be accomplished by delivering notice to the 
Trustee which describes the amounts deposited in error in the Distribution      
Account. All funds deposited in the Distribution Account shall be held by the   
Trustee in trust for the Certificateholders until disbursed in accordance with  
this Agreement or withdrawn in accordance with Section 4.02.                    

            (e) The Trustee may invest the funds in the Distribution Account, in
one or more Permitted Investments, in accordance with Section 3.12. Each        
Servicer shall direct the Trustee to withdraw from the Distribution Account and 
to remit to such Servicer no less than monthly, all income and gain realized    
from the investment of the portion of funds deposited in the Distribution       
Account by such Servicer (except during the Trustee Float Period). The Trustee  
may withdraw from the Distribution Account any income or gain earned from the   
investment of funds deposited therein during the Trustee Float Period for its   
own benefit.                                                                    

       (f) Each Servicer shall give notice to the Trustee, each Rating
Agency and the Depositor of any proposed change of the location of the related  
Collection Account within a reasonable period of time prior to any change       
thereof.                                                                        

       (g) To help fight the funding of terrorism and money laundering
activities, the Trustee will obtain, verify, and record information that        
identifies individuals or entities that establish a relationship or open an     
account with the Trustee. The Trustee will ask for the name, address, tax       
identification number and other information that will allow the Trustee to      
identify the individual or entity who is establishing the relationship or       
opening the account. The Trustee may also ask for formation documents such as   
articles of incorporation, an offering memorandum, or other identifying         
documents to be provided.                                                       

  Section 3.08 Subservicing Accounts. In those cases where a
Subservicer is servicing a Mortgage Loan pursuant to a Subservicing Agreement,  
the Subservicer will be required to establish and maintain one or more          
segregated accounts (collectively, the "Subservicing Account"). The Subservicing
Account shall be an Eligible Account and shall otherwise be acceptable to the   
related Servicer. The Subservicer shall deposit in the clearing account (which  
account must be an Eligible Account) in which it customarily deposits payments  
and collections on mortgage loans in connection with its mortgage loan servicing
activities on a daily basis, and in no event more than one Business Day after   
the Subservicer's receipt thereof, all proceeds of Mortgage Loans received by   
the Subservicer less its servicing compensation to the extent permitted by the  
Subservicing Agreement, and shall thereafter deposit such amounts in the        
Subservicing Account, in no event more than two Business Days after the deposit 
of such funds into the clearing account. The Subservicer shall thereafter       
deposit such proceeds in the Collection Account of the related Servicer or remit
such proceeds to the related Servicer for deposit in the Collection Account of  
the related Servicer not later than two Business Days after the deposit of such 
amounts in the Subservicing Account. For purposes of this Agreement, such       
Servicer shall be deemed to have received payments on the Mortgage Loans when   
the Subservicer receives such payments.                                         

        Section 3.09 Collection of Taxes, Assessments and Similar Items;
Escrow Accounts. (a) Each Servicer shall enforce the obligations under each     
paid-in-full, life-of-the-loan tax service contract in effect with respect to   
each First Lien Mortgage Loan (each, a "Tax Service Contract") serviced by such 
Servicer. Each Tax Service Contract shall be assigned to the Trustee, or a      
successor servicer at the applicable Servicer's expense in the event that a     
Servicer is terminated as Servicer of the related Mortgage Loan.                

           (b) To the extent that the services described in this paragraph (b)
are not otherwise provided pursuant to the Tax Service Contracts described in   
paragraph (a) above, each Servicer undertakes to perform such functions with    
respect to the Mortgage Loans serviced by such Servicer. To the extent the      
related Mortgage provides for Escrow Payments, the related Servicer shall       
establish and maintain, or cause to be established and maintained, one or more  
segregated accounts (the "Escrow Accounts"), which shall be Eligible Accounts.  
Each Servicer shall deposit in the clearing account (which account must be an   
Eligible Account) in which it customarily deposits payments and collections on  
mortgage loans in connection with its mortgage loan servicing activities on a   
daily basis, and in no event more than one Business Day after the Servicer's    
receipt thereof, all collections from the Mortgagors (or related advances from  
Subservicers) for the payment of taxes, assessments, hazard insurance premiums  
and comparable items for the account of the Mortgagors ("Escrow Payments")      
collected on account of the Mortgage Loans and shall thereafter deposit such    
Escrow Payments in the Escrow Accounts, in no event more than two Business Days 
after the deposit of such funds in the clearing account, for the purpose of     
effecting the payment of any such items as required under the terms of this     
Agreement. Withdrawals of amounts from an Escrow Account may be made only to (i)
effect payment of taxes, assessments, hazard insurance premiums, and comparable 
items; (ii) reimburse such Servicer (or a Subservicer to the extent provided in 
the related Subservicing Agreement) out of related collections for any advances 
made pursuant to Section 3.01 (with respect to taxes and assessments) and       
Section 3.13 (with respect to hazard insurance); (iii) refund to Mortgagors any 
sums as may be determined to be overages; (iv) pay interest, if required and as 
described below, to Mortgagors on balances in the Escrow Account; (v) clear and 
terminate the Escrow Account at the termination of such Servicer's obligations  
and responsibilities in respect of the Mortgage Loans under this Agreement; (vi)
to transfer such funds to a replacement Escrow Account that meets the           
requirements hereof; or (vii) recover amounts deposited in error. As part of its
servicing duties, each Servicer or Subservicers shall pay to the Mortgagors     
interest on funds in Escrow Accounts, to the extent required by law and, to the 
extent that interest earned on funds in the Escrow Accounts is insufficient, to 
pay such interest from its or their own funds, without any reimbursement        
therefor. To the extent that a Mortgage does not provide for Escrow Payments,   
the applicable Servicer shall determine whether any such payments are made by   
the Mortgagor in a manner and at a time that avoids the loss of the Mortgaged   
Property due to a tax sale or the foreclosure of a tax lien. The applicable     
Servicer assumes full responsibility for the payment of all such bills within   
such time and shall effect payments of all such bills irrespective of the       
Mortgagor's faithful performance in the payment of same or the making of the    
Escrow Payments and shall make advances from its own funds to effect such       
payments; provided, however, that such advances are deemed to be Servicing      
Advances.                                                                       

            Section 3.10 Collection Accounts. (a) On behalf of the Trustee, each
Servicer shall establish and maintain, or cause to be established and           
maintained, one or more separate Eligible Accounts (such account or accounts,   
the "Collection Account"), held in trust for the benefit of the Trustee. On     
behalf of the Trustee, each Servicer shall deposit or cause to be deposited in  
the clearing account (which account must be an Eligible Account) in which it    
customarily deposits payments and collections on mortgage loans in connection   
with its mortgage loan servicing activities on a daily basis, and in no event   
more than one Business Day after such Servicer's receipt thereof, and shall     
thereafter deposit in the related Collection Account, in no event more than two 
Business Days after the deposit of such funds into the clearing account, as and 
when received or as otherwise required hereunder, the following payments and    
collections received or made by it subsequent to the Cut-off Date (other than in
respect of principal or interest on the related Mortgage Loans due on or before 
the Cut-off Date), or payments (other than Principal Prepayments) received by it
on or prior to the related Cut-off Date but allocable to a Due Period subsequent
thereto:                                                                        

     (i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;                                 

    (ii) all payments on account of interest (net of the related
Servicing Fee) on each Mortgage Loan;                               

            (iii) all Insurance Proceeds and Condemnation Proceeds to the extent
      such Insurance Proceeds and Condemnation Proceeds are not to be applied to
the restoration of the related Mortgaged Property or released to the
      related Mortgagor in accordance with the express requirements of law or in
  accordance with Accepted Servicing Practices and Liquidation Proceeds;

          (iv) any amounts required to be deposited pursuant to Section 3.12
in connection with any losses realized on Permitted Investments with
respect to funds held in the related Collection Account;            

          (v) any amounts required to be deposited by such Servicer pursuant
to the second paragraph of Section 3.13(a) in respect of any blanket
policy deductibles;                                                 

          (vi) all proceeds of any Mortgage Loan repurchased or purchased in
accordance with this Agreement; and                                 

           (vii) all Prepayment Charges collected or paid (pursuant to Section
3.07(a)) by such Servicer.                                          

         The foregoing requirements for deposit in the Collection Accounts
shall be exclusive, it being understood and agreed that, without limiting the   
generality of the foregoing, payments in the nature of late payment charges, NSF
fees, reconveyance fees, assumption fees and other similar fees and charges need
not be deposited by each Servicer in the related Collection Account and shall,  
upon collection, belong to the applicable Servicer as additional compensation   
for its servicing activities. In the event a Servicer shall deposit in the      
related Collection Account any amount not required to be deposited therein, it  
may at any time withdraw such amount from its Collection Account, any provision 
herein to the contrary notwithstanding.                                         

         (b) Funds in the Collection Accounts may be invested in Permitted
Investments in accordance with the provisions set forth in Section 3.12. Each   
Servicer shall give notice to the Trustee of the location of the related        
Collection Account maintained by it when established and prior to any change    
thereof in accordance with Section 3.07(f).                                     

       Section 3.11 Withdrawals from the Collection Accounts. (a) Each
Servicer shall, from time to time, make withdrawals from the related Collection 
Account for any of the following purposes or as described in Section 4.01:      

            (i) on or prior to each Remittance Date, to remit to the Trustee (A)
the Trustee Fee with respect to such Distribution Date and (B) all  
   Available Funds (without reduction for amounts owed to the Depositor or
  the Trustee as provided for in the definition of "Available Funds") in
respect of the related Distribution Date together with all amounts  
   representing Prepayment Charges from the Mortgage Loans received by the
applicable Servicer during the related Prepayment Period;           

         (ii) to reimburse such Servicer for P&I Advances, but only to the
   extent of amounts received which represent Late Collections (net of the
related Servicing Fees) of Scheduled Payments on Mortgage Loans with
respect to which such P&I Advances were made in accordance with the 
provisions of Section 4.01 (such Servicer's right for recovery or   
    reimbursement has priority over the Trust as stated in the definition of
"Available Funds");                                                 

    (iii) to pay such Servicer or any Subservicer (a) any unpaid
     Servicing Fees or (b) any unreimbursed Servicing Advances with respect to
    each Mortgage Loan serviced by such Servicer or Subservicer, but only to
  the extent of any Late Collections, Liquidation Proceeds, Condemnation
     Proceeds, Insurance Proceeds or other amounts as may be collected by such
 Servicer from a Mortgagor, or otherwise received with respect to such
  Mortgage Loan (or the related REO Property) (such Servicer's right for
  recovery or reimbursement has priority over the Trust as stated in the
definition of "Available Funds");                                   

           (iv) to pay to such Servicer as servicing compensation (in addition
   to the Servicing Fee) on the Remittance Date any interest or investment
income earned on funds deposited in its Collection Account;         

          (v) to pay to the Responsible Party, with respect to each Mortgage
  Loan that has previously been repurchased or replaced pursuant to this
      Agreement, all amounts received thereon subsequent to the date of purchase
or substitution, as further described herein;                       

            (vi) to reimburse such Servicer for (A) any P&I Advance or Servicing
Advance previously made which such Servicer has determined to be a  
Nonrecoverable P&I Advance or Nonrecoverable Servicing Advance in   
accordance with the provisions of Section 4.01 and (B) any unpaid   
     Servicing Fees related to any Second Lien Mortgage Loan to the extent not
      recoverable from Liquidation Proceeds, Insurance Proceeds or other amounts
received with respect to the related Second Lien Mortgage Loan under
     Section 3.11(a)(iii) (such Servicer's right for recovery or reimbursement
 has priority over the Trust as stated in the definition of "Available
Funds");                                                            

           (vii) to pay, or to reimburse such Servicer for advances in respect
  of, expenses incurred in connection with any Mortgage Loan serviced by
      such Servicer pursuant to Section 3.15 (such Servicer's right for recovery
or reimbursement has priority over the Trust);                      

       (viii) to reimburse such Servicer or the Depositor for expenses
      incurred by or reimbursable to such Servicer or the Depositor, as the case
   may be, pursuant to Section 6.03 (such Servicer's right for recovery or
    reimbursement has priority over the Trust as stated in the definition of
"Available Funds");                                                 

           (ix) to reimburse such Servicer or the Trustee, as the case may be,
      for expenses reasonably incurred in respect of the breach or defect giving
 rise to the repurchase obligation of the Responsible Party under this
      Agreement that were included in the Repurchase Price of the Mortgage Loan,
   including any expenses arising out of the enforcement of the repurchase
     obligation, to the extent not otherwise paid pursuant to the terms hereof
      (such Servicer's right for recovery or reimbursement has priority over the
Trust as stated in the definition of "Available Funds");            

       (x) to withdraw any amounts deposited in the related Collection
Account in error;                                                   

           (xi) to withdraw any amounts held in the related Collection Account
 and not required to be remitted to the Trustee on the Remittance Date
occurring in the month in which such amounts are deposited into such
Collection Account, to reimburse such Servicer for unreimbursed P&I 
Advances;                                                           

         (xii) to invest funds in Permitted Investments in accordance with
Section 3.12; and                                                   

         (xiii) to clear and terminate the related Collection Account upon
termination of this Agreement.                                      

           (b) Each Servicer shall keep and maintain separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any         
withdrawal from the related Collection Account, to the extent held by or on     
behalf of it, pursuant to subclauses (a)(ii), (iii), (v), (vi), (vii), (viii)   
and (ix) above. Each Servicer shall provide written notification (as set forth  
in Section 4.01(d)) to the Trustee, on or prior to the next succeeding          
Remittance Date, upon making any withdrawals from the related Collection Account
pursuant to subclause (a)(vi) above.                                            

            (c) Each Servicer shall be responsible for reviewing and reconciling
the applicable Collection Account in accordance with Accepted Servicing         
Practices. Each Servicer shall act promptly to resolve any discrepancies.       

           Section 3.12 Investment of Funds in the Collection Accounts and the
Distribution Account. (a) Each Servicer may invest the funds in the related     
Collection Account and the related Escrow Account (to the extent permitted by   
law and the related Mortgage Loan documents) and the Trustee may (but is not    
obligated to) invest funds in the Distribution Account during the Trustee Float 
Period, and, with respect to the portion of funds in the Distribution Account   
deposited by a Servicer, shall (except during the Trustee Float Period) invest  
such funds in the Distribution Account at the direction of such Servicer (for   
purposes of this Section 3.12, such Accounts are referred to as an "Investment  
Account"), in one or more Permitted Investments bearing interest or sold at a   
discount, and maturing, unless payable on demand, no later than the Business Day
immediately preceding the date on which such funds are required to be withdrawn 
from such account pursuant to this Agreement; provided, however, that the       
Trustee shall have no obligation to invest funds deposited into the Distribution
Account by a Servicer on the Remittance Date later than 10:00 a.m. (Pacific     
Standard Time). If no investment instruction is given in a timely manner, the   
Trustee shall hold the funds in the Distribution Account uninvested. All such   
Permitted Investments shall be held to maturity, unless payable on demand. Any  
investment of funds in an Investment Account (other than investments made during
the Trustee Float Period) shall be made in the name of the Trustee in Permitted 
Investments selected by the applicable Servicer. The applicable Servicer shall  
be entitled to sole possession (except with respect to investment direction of  
funds and any income and gain realized on any investment in the Distribution    
Account during the Trustee Float Period, which shall be for the sole benefit of 
the Trustee) over each such related investment, and any certificate or other    
instrument evidencing any such investment shall be delivered directly to the    
applicable Servicer, or with respect to investments during the Trustee Float    
Period, the Trustee or its agent (with a copy to the Trustee or its agent if    
related to investment of funds in the Distribution Account not during the       
Trustee Float Period), together with any document of transfer necessary to      
transfer title to such investment to the applicable Servicer, or with respect to
investments during the Trustee Float Period, the Trustee or its agent. In the   
event amounts on deposit in an Investment Account are at any time invested in a 
Permitted Investment payable on demand, the applicable Servicer, or with respect
to investments during the Trustee Float Period, the Trustee may:                

         (x)   consistent with any notice required to be given
                      thereunder, demand that payment thereon be made on the
                       last day such Permitted Investment may otherwise mature
                     hereunder in an amount equal to the lesser of (1) all
                  amounts then payable thereunder and (2) the amount
          required to be withdrawn on such date; and

                (y)   demand payment of all amounts due thereunder that such
                     Permitted Investment would not constitute a Permitted
                       Investment in respect of funds thereafter on deposit in
an Investment Account.          

     (b) All income and gain realized from the investment of funds
deposited in the related Collection Account or Escrow Account held by or on     
behalf of the related Servicer, shall be for the benefit of such Servicer and   
shall be subject to its withdrawal in the manner set forth in Section 3.11. Such
Servicer shall deposit in its Collection Account or Escrow Account, as          
applicable, the amount of any loss of principal incurred in respect of any such 
Permitted Investment made with funds in such accounts immediately upon          
realization of such loss.                                                       

           (c) All income and gain realized from the investment of the portion
of funds deposited in the Distribution Account by a Servicer and held by the    
Trustee, shall be for the benefit of such Servicer (except for any income or    
gain realized from the investment of funds on deposit in the Distribution       
Account during the Trustee Float Period, which shall be for the benefit of the  
Trustee) and shall be subject to the Trustee's withdrawal in the manner set     
forth in Section 3.07(e). Each Servicer shall deposit in the Distribution       
Account (except with respect to losses incurred during the Trustee Float Period)
the amount of any loss of principal incurred in respect of any such Permitted   
Investment made with funds in such accounts immediately upon realization of such
loss.                                                                           

            (d) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of a payment due under any Permitted Investment, or
if a default occurs in any other performance required under any Permitted       
Investment, the Trustee shall take such action as may be appropriate to enforce 
such payment or performance, including the institution and prosecution of       
appropriate proceedings.                                                        

      (e) The Trustee shall not be liable for the amount of any loss
incurred with respect of any investment or lack of investment of funds held in  
any Investment Account or the Distribution Account (except that if any losses   
are incurred from the investment of funds deposited in the Distribution Account 
during the Trustee Float Period, the Trustee shall be responsible for           
reimbursing the Trust for such loss immediately upon realization of such loss)  
if made in accordance with this Section 3.12.                                   

       (f) The Trustee or its Affiliates shall be permitted to receive
additional compensation that could be deemed to be in the Trustee's economic    
self-interest for (i) serving as investment adviser, administrator, shareholder,
servicing agent, custodian or sub-custodian with respect to certain of the      
Permitted Investments, (ii) using Affiliates to effect transactions in certain  
Permitted Investments and (iii) effecting transactions in certain Permitted     
Investments. Such compensation shall not be considered an amount that is        
reimbursable or payable pursuant to this Agreement.                             

   Section 3.13 Maintenance of Hazard Insurance and Errors and
Omissions and Fidelity Coverage. (a) Each Servicer shall cause to be maintained 
for each Mortgage Loan serviced by such Servicer fire insurance with extended   
coverage on the related Mortgaged Property in an amount which is at least equal 
to the least of (i) the outstanding principal balance of such Mortgage Loan,    
(ii) the amount necessary to fully compensate for any damage or loss to the     
improvements that are a part of such property on a replacement cost basis and   
(iii) the maximum insurable value of the improvements which are a part of such  
Mortgaged Property, in each case in an amount not less than such amount as is   
necessary to avoid the application of any coinsurance clause contained in the   
related hazard insurance policy. Each Servicer shall also cause to be maintained
fire insurance with extended coverage on each REO Property serviced by such     
Servicer in an amount which is at least equal to the lesser of (i) the maximum  
insurable value of the improvements which are a part of such property and (ii)  
the outstanding principal balance of the related Mortgage Loan at the time it   
became an REO Property. Each Servicer will comply in the performance of this    
Agreement with all reasonable rules and requirements of each insurer under any  
such hazard policies. Any amounts to be collected by any Servicer under any such
policies (other than amounts to be applied to the restoration or repair of the  
property subject to the related Mortgage or amounts to be released to the       
Mortgagor in accordance with the procedures that such Servicer would follow in  
servicing loans held for its own account, subject to the terms and conditions of
the related Mortgage and Mortgage Note) shall be deposited in the related       
Collection Account, subject to withdrawal pursuant to Section 3.11. Any cost    
incurred by any Servicer in maintaining any such insurance shall not, for the   
purpose of calculating distributions to the Trustee, be added to the unpaid     
principal balance of the related Mortgage Loan, notwithstanding that the terms  
of such Mortgage Loan so permit. It is understood and agreed that no earthquake 
or other additional insurance is to be required of any Mortgagor other than     
pursuant to such applicable laws and regulations as shall at any time be in     
force and as shall require such additional insurance. If the Mortgaged Property 
or REO Property is at any time in an area identified in the Federal Register by 
the Federal Emergency Management Agency as having special flood hazards and     
flood insurance has been made available, the applicable Servicer will cause to  
be maintained a flood insurance policy in respect thereof. Such flood insurance 
shall be in an amount equal to the lesser of (i) the unpaid principal balance of
the related Mortgage Loan and (ii) the maximum amount of such insurance         
available for the related Mortgaged Property under the national flood insurance 
program (assuming that the area in which such Mortgaged Property is located is  
participating in such program).                                                 

          In the event that any Servicer shall obtain and maintain a blanket
policy with an insurer either (i) acceptable to Fannie Mae or Freddie Mac or    
(ii) having a General Policy Rating of A:X or better from Best's (or such other 
rating that is comparable to such rating) insuring against hazard losses on all 
of the Mortgage Loans, it shall conclusively be deemed to have satisfied its    
obligations as set forth in the first two sentences of this Section 3.13, it    
being understood and agreed that such policy may contain a deductible clause, in
which case such Servicer shall, in the event that there shall not have been     
maintained on the related Mortgaged Property or REO Property a policy complying 
with the first two sentences of this Section 3.13, and there shall have been one
or more losses which would have been covered by such policy, deposit to the     
related Collection Account from its own funds the amount not otherwise payable  
under the blanket policy because of such deductible clause. In connection with  
its activities as administrator and servicer of the Mortgage Loans, each        
Servicer agrees to prepare and present, on behalf of itself and the Trustee     
claims under any such blanket policy in a timely fashion in accordance with the 
terms of such policy.                                                           

     (b) Each Servicer shall keep in force during the term of this
Agreement a policy or policies of insurance covering errors and omissions for   
failure in the performance of such Servicer's obligations under this Agreement, 
which policy or policies shall be in such form and amount that would meet the   
requirements of Fannie Mae or Freddie Mac if it were the purchaser of the       
Mortgage Loans, unless such Servicer has obtained a waiver of such requirements 
from Fannie Mae or Freddie Mac. Each Servicer shall also maintain a fidelity    
bond in the form and amount that would meet the requirements of Fannie Mae or   
Freddie Mac, unless such Servicer has obtained a waiver of such requirements    
from Fannie Mae or Freddie Mac. Each Servicer shall provide the Trustee upon    
request with copies of any such insurance policies and fidelity bond. Each      
Servicer shall be deemed to have complied with this provision if an Affiliate of
the applicable Servicer has such errors and omissions and fidelity bond coverage
and, by the terms of such insurance policy or fidelity bond, the coverage       
afforded thereunder extends to such Servicer. Any such errors and omissions     
policy and fidelity bond shall by its terms not be cancelable without thirty    
days' prior written notice to the Trustee. Each Servicer shall also cause each  
Subservicer to maintain a policy of insurance covering errors and omissions and 
a fidelity bond which would meet such requirements.                             

     Section 3.14 Enforcement of "Due-on-Sale" Clauses; Assumption
Agreements. Each Servicer will, to the extent it has knowledge of any conveyance
or prospective conveyance of any Mortgaged Property by any Mortgagor (whether by
absolute conveyance or by contract of sale, and whether or not the Mortgagor    
remains or is to remain liable under the Mortgage Note and/or the Mortgage),    
exercise its rights to accelerate the maturity of such Mortgage Loan under the  
"due-on-sale" clause, if any, applicable thereto; provided, however, that no    
Servicer shall be required to take such action if, in its sole business         
judgment, such Servicer believes it is not in the best interests of the Trust   
Fund and shall not exercise any such rights if prohibited by law from doing so. 
If a Servicer reasonably believes it is unable under applicable law to enforce  
such "due-on-sale" clause or if any of the other conditions set forth in the    
proviso to the preceding sentence apply, such Servicer will enter into an       
assumption and modification agreement from or with the person to whom such      
property has been conveyed or is proposed to be conveyed, pursuant to which such
person becomes liable under the Mortgage Note and, to the extent permitted by   
applicable state law, the Mortgagor remains liable thereon. Each Servicer is    
also authorized to enter into a substitution of liability agreement with such   
person, pursuant to which the original Mortgagor is released from liability and 
such person is substituted as the Mortgagor and becomes liable under the        
Mortgage Note; provided, that no such substitution shall be effective unless    
such person satisfies the underwriting criteria of such Servicer and such       
substitution is in the best interest of the Certificateholders as determined by 
such Servicer. In connection with any assumption, modification or substitution, 
such Servicer shall apply such underwriting standards and follow such practices 
and procedures as shall be normal and usual in its general mortgage servicing   
activities and as it applies to other mortgage loans owned solely by it. No     
Servicer shall take or enter into any assumption and modification agreement,    
however, unless (to the extent practicable in the circumstances) it shall have  
received confirmation, in writing, of the continued effectiveness of any        
applicable hazard insurance policy, or a new policy meeting the requirements of 
this Section is obtained. Any fee collected by a Servicer in respect of an      
assumption or substitution of liability agreement will be retained by such      
Servicer as additional servicing compensation. In connection with any such      
assumption, no material term of the Mortgage Note (including but not limited to 
the related Mortgage Rate and the amount of the Scheduled Payment) may be       
amended or modified, except as otherwise required pursuant to the terms thereof.
Each Servicer shall notify the Trustee that any such substitution, modification 
or assumption agreement has been completed and shall forward to the Trustee the 
executed original of such substitution 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.                          

         Notwithstanding the foregoing paragraph or any other provision of
this Agreement, a Servicer shall not be deemed to be in default, breach or any  
other violation of its obligations hereunder by reason of any assumption of a   
Mortgage Loan by operation of law or by the terms of the Mortgage Note or any   
assumption which such Servicer may be restricted by law from preventing, for any
reason whatsoever. For purposes of this Section 3.14, the term "assumption" is  
deemed to also include a sale (of the Mortgaged Property) subject to the        
Mortgage that is not accompanied by an assumption or substitution of liability  
agreement.                                                                      

    Section 3.15 Realization upon Defaulted Mortgage Loans. Each
Servicer shall use its best efforts, consistent with Accepted Servicing         
Practices, to foreclose upon or otherwise comparably convert (which may include 
an acquisition of REO Property) the ownership of properties securing such of the
Mortgage Loans as come into and continue in default and as to which no          
satisfactory arrangements can be made for collection of delinquent payments     
pursuant to Section 3.07, and which are not released from this Agreement        
pursuant to any other provision hereof. Each Servicer shall use reasonable      
efforts to realize upon such defaulted Mortgage Loans in such manner as will    
maximize the receipt of principal and interest by the Trustee, taking into      
account, among other things, the timing of foreclosure proceedings; provided,   
however, with respect to any Second Lien Mortgage Loan for which the related    
first lien mortgage loan is not included in the Trust Fund, if, after such      
Mortgage Loan becomes 180 days or more delinquent, the applicable Servicer      
determines that a significant net recovery is not possible through foreclosure, 
such Mortgage Loan may be charged off and the Mortgage Loan will be treated as a
Liquidated Mortgage Loan giving rise to a Realized Loss. The foregoing is       
subject to the provisions that, in any case in which Mortgaged Property shall   
have suffered damage from an uninsured cause, a Servicer shall not be required  
to expend its own funds toward the restoration of such property unless it shall 
determine in its sole discretion (i) that such restoration will increase the net
proceeds of liquidation of the related Mortgage Loan to the Trustee, after      
reimbursement to itself for such expenses, and (ii) that such expenses will be  
recoverable by such Servicer through Insurance Proceeds, Condemnation Proceeds  
or Liquidation Proceeds from the related Mortgaged Property, as contemplated in 
Section 3.11. Each Servicer shall be responsible for all other costs and        
expenses incurred by it in any such proceedings; provided, however, that it     
shall be entitled to reimbursement thereof from the related property, as        
contemplated in Section 3.11.                                                   

          The proceeds of any liquidation or REO Disposition, as well as any
recovery resulting from a partial collection of Insurance Proceeds, Condemnation
Proceeds or Liquidation Proceeds or any income from an REO Property, will be    
applied in the following order of priority: first, to reimburse the applicable  
Servicer or any Subservicer for any related unreimbursed Servicing Advances,    
pursuant to Section 3.11 or 3.17; second, to reimburse the applicable Servicer  
for any related unreimbursed P&I Advances, pursuant to Section 3.11; third, to  
accrued and unpaid interest on the Mortgage Loan or REO Imputed Interest, at the
Mortgage Rate, to the date of the liquidation or REO Disposition, or to the Due 
Date prior to the Remittance Date on which such amounts are to be distributed if
not in connection with a liquidation or REO Disposition; and fourth, as a       
recovery of principal of the Mortgage Loan. If the amount of the recovery so    
allocated to interest is less than a full recovery thereof, that amount will be 
allocated as follows: first, to unpaid Servicing Fees; and second, as interest  
at the Mortgage Rate (net of the Servicing Fee Rate). The portion of the        
recovery so allocated to unpaid Servicing Fees shall be reimbursed to the       
applicable Servicer or any Subservicer pursuant to Section 3.11 or 3.17. The    
portions of the recovery so allocated to interest at the Mortgage Rate (net of  
the Servicing Fee Rate) and to principal of the Mortgage Loan shall be applied  
as follows: first, to reimburse the applicable Servicer or any Subservicer for  
any related unreimbursed Servicing Advances in accordance with Section 3.11 or  
3.17, and second, to the Trustee in accordance with the provisions of Section   
4.02, subject to the last paragraph of Section 3.17 with respect to certain     
excess recoveries from an REO Disposition.                                      

     Notwithstanding anything to the contrary contained herein, in
connection with a foreclosure or acceptance of a deed in lieu of foreclosure, in
the event a Servicer has received actual notice of, or has actual knowledge of  
the presence of, hazardous or toxic substances or wastes on the related         
Mortgaged Property, or if the Trustee otherwise requests, such Servicer shall   
cause an environmental inspection or review of such Mortgaged Property to be    
conducted by a qualified inspector. Upon completion of the inspection, such     
Servicer shall promptly provide the Trustee and the Depositor with a written    
report of the environmental inspection.                                         

           After reviewing the environmental inspection report, the applicable
Servicer shall determine consistent with Accepted Servicing Practices how the   
Servicer 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 applicable  
Servicer determines, consistent with Accepted Servicing Practices, to proceed   
with foreclosure or acceptance of a deed in lieu of foreclosure, such Servicer  
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 such Servicer, such    
Servicer shall be entitled to be reimbursed from amounts in the related         
Collection Account pursuant to Section 3.11. In the event the applicable        
Servicer determines not to proceed with foreclosure or acceptance of a deed in  
lieu of foreclosure, such Servicer shall be reimbursed from general collections 
for all Servicing Advances made with respect to the related Mortgaged Property  
from the related Collection Account pursuant to Section 3.11. The Trustee shall 
not be responsible for any determination made by the applicable Servicer        
pursuant to this paragraph or otherwise. JPMorgan shall notify the Trustee of   
such election, which notice maybe provided in a Servicer Remittance Report      
delivered pursuant to Section 4.03(d).                                          

           In the event HomEq elects to charge-off a Second Lien Mortgage Loan
180 days or more delinquent pursuant to this Section 3.15, no Second Lien       
Mortgage Loan shall be characterized as a Liquidated Mortgage Loan, unless the  
Depositor consents in writing to such characterization after HomEq has provided 
the Depositor with a combined equity analysis of such Second Lien Mortgage Loan 
and the related first lien mortgage loan; provided, that if the Depositor has   
failed to notify HomEq within 3 Business Days of receipt of such combined equity
analysis, then the Depositor shall be deemed to have consented to such          
characterization. In the event HomEq elects to charge off a Second Lien Mortgage
Loan 180 days or more delinquent pursuant to this Section 3.15, HomEq shall     
notify the Trustee of such election, which notice may be provided in a Servicer 
Remittance Report delivered pursuant to Section 4.03(d). JPMorgan may elect to  
charge-off a Second Lien Mortgage Loan pursuant to this Section 3.15 without    
such written consent, so long as such Second Lien Mortgage Loan is 180 days or  
more delinquent. JPMorgan shall notify the Trustee of such election, which      
notice may be provided in a Servicer Remittance Report delivered pursuant to    
Section 4.03(d).                                                                

            Section 3.16 Release of Mortgage Files. (a) Upon the payment in full
of any Mortgage Loan, or the receipt by a Servicer of a notification that       
payment in full shall be escrowed in a manner customary for such purposes, such 
Servicer will, on or before the last day of the month in which such payment in  
full occurs, notify the Trustee by a certification (which certification shall   
include a statement to the effect that all amounts received or to be received in
connection with such payment which are required to be deposited in the related  
Collection Account pursuant to Section 3.10 have been or will be so deposited)  
of a Servicing Officer and shall request delivery to it of the Custodial File by
submitting a Request for Release (in writing or an electronic format acceptable 
to the Trustee) to the Trustee. Upon receipt of such certification and Request  
for Release, the Trustee shall promptly release the related Custodial File to   
such Servicer within five (5) Business Days. No expenses incurred in connection 
with any instrument of satisfaction or deed of reconveyance shall be chargeable 
to the related Collection Account.                                              

     (b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose, collection under 
any Insurance Policy relating to the Mortgage Loans, the Trustee shall, upon    
request of such Servicer and delivery to the Trustee of a Request for Release in
written or electronic form, release the related Custodial File to such Servicer,
and the Trustee shall, at the direction of such Servicer, execute such documents
as shall be necessary to the prosecution of any such proceedings and such       
Servicer shall retain the Mortgage File in trust for the benefit of the Trustee.
Such Request for Release shall obligate the applicable Servicer to return each  
and every document previously requested from the Custodial File to the Trustee  
when the need therefor by such Servicer no longer exists, unless the Mortgage   
Loan has been charged-off or liquidated and the Liquidation Proceeds relating to
the Mortgage Loan have been deposited in the related Collection Account or the  
Mortgage File or such document has been delivered to an attorney, or to a public
trustee or other public official as required by law, for purposes of initiating 
or pursuing legal action or other proceedings for the foreclosure of the        
Mortgaged Property either judicially or non-judicially, and such Servicer has   
delivered to the Trustee a certificate of a Servicing Officer certifying as to  
the name and address of the Person to which such Mortgage File or such document 
was delivered and the purpose or purposes of such delivery. Upon receipt of a   
certificate of a Servicing Officer stating that such Mortgage Loan was          
charged-off or liquidated and that all amounts received or to be received in    
connection with such liquidation that are required to be deposited into the     
related Collection Account have been so deposited, or that such Mortgage Loan   
has become an REO Property, a copy of the Request for Release shall be released 
by the Trustee to the applicable Servicer or its designee upon request therefor.
Upon receipt of a Request for Release under this Section 3.16, the Trustee shall
deliver the related Custodial File to the requesting Servicer; provided,        
however, that in the event a Servicer has not previously received copies of the 
relevant Mortgage Loan Documents necessary to service the related Mortgage Loan 
in accordance with Accepted Servicing Practices, the Responsible Party shall    
reimburse the Trustee for any overnight courier charges incurred for the        
requested Custodial Files.                                                      

            Upon written certification of a Servicing Officer, the Trustee shall
execute and deliver to the applicable Servicer copies of any court pleadings,   
requests for trustee's sale or other documents reasonably necessary to the      
foreclosure or trustee's sale in respect of a Mortgaged Property or to any legal
action brought to obtain judgment against any Mortgagor on the Mortgage Note or 
Mortgage or to obtain a deficiency judgment, or to enforce any other remedies or
rights provided by the Mortgage Note or Mortgage or otherwise available at law  
or in equity, or shall exercise and deliver to such Servicer a power of attorney
sufficient to authorize such Servicer to execute such documents on its behalf.  
Each such certification shall include a request that such pleadings or documents
be executed by the Trustee and a statement as to the reason such documents or   
pleadings are required and that the execution and delivery thereof by the       
Trustee will not invalidate or otherwise affect the lien of the Mortgage, except
for the termination of such a lien upon completion of the foreclosure or        
trustee's sale.                                                                 

         Section 3.17 Title, Conservation and Disposition of REO Property.
(a) This Section shall apply only to REO Properties acquired for the account of 
the Trustee and shall not apply to any REO Property relating to a Mortgage Loan 
which was purchased or repurchased from the Trustee pursuant to any provision   
hereof. In the event that title to any such REO Property is acquired, the       
applicable Servicer shall cause the deed or certificate of sale to be issued in 
the name of the Trustee, on behalf of the Certificateholders. Upon written      
request by the applicable Servicer, the Trustee shall provide such Servicer with
a power of attorney prepared by such Servicer with respect to such REO Property.

          (b) Each Servicer shall manage, conserve, protect and operate each
related REO Property for the Trustee solely for the purpose of its prompt       
disposition and sale. Each Servicer, either itself or through an agent selected 
by such Servicer, 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. Each Servicer     
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 such Servicer deems to be in the best interest of the Trustee. The
Trustee shall have no obligations with respect to any REO Dispositions.         

          (c) Each Servicer shall segregate and hold all funds collected and
received in connection with the operation of any REO Property separate and apart
from its own funds and general assets and shall deposit such funds in the       
related Collection Account.                                                     

    (d) Each Servicer shall deposit net of reimbursement to such
Servicer for any related outstanding Servicing Advances and unpaid Servicing    
Fees provided in Section 3.11, or cause to be deposited, in no event more than  
two (2) Business Days following such Servicer's receipt thereof in the related  
Collection Account all revenues received with respect to the related REO        
Property and shall withdraw therefrom funds necessary for the proper operation, 
management and maintenance of the REO Property.                                 

        (e) Each Servicer, upon an REO Disposition, shall be entitled to
reimbursement for any related unreimbursed Servicing Advances as well as any    
unpaid Servicing Fees from proceeds received in connection with the REO         
Disposition, as further provided in Section 3.11.                               

           (f) Any net proceeds from an REO Disposition which are in excess of
the unpaid principal balance of the related Mortgage Loan plus all unpaid REO   
Imputed Interest thereon through the date of the REO Disposition shall be       
retained by the applicable Servicer as additional servicing compensation.       

           (g) Each Servicer shall use its reasonable best efforts to sell, or
cause its Subservicer to sell, in accordance with Accepted Servicing Practices, 
any REO Property serviced by such Servicer or Subservicer as soon as possible,  
but in no event later than the conclusion of the third calendar year beginning  
after the year of its acquisition by Pooling-Tier REMIC-1 unless (i) such       
Servicer applies for an extension of such period from the Internal Revenue      
Service pursuant to the REMIC Provisions and Code Section 856(e)(3), in which   
event such REO Property shall be sold within the applicable extension period, or
(ii) such Servicer obtains for the Trustee an Opinion of Counsel, addressed to  
the Depositor, the Trustee and such Servicer, to the effect that the holding by 
the Pooling-Tier REMIC-1 of such REO Property subsequent to such period will not
result in the imposition of taxes on "prohibited transactions" as defined in    
Section 860F of the Code or cause any Trust REMIC to fail to qualify as a REMIC 
under the REMIC Provisions or comparable provisions of relevant state laws at   
any time. Each Servicer shall manage, conserve, protect and operate each REO    
Property serviced by such Servicer for the Trustee solely for the purpose of its
prompt disposition and sale in a manner which does not cause such REO Property  
to fail to qualify as "foreclosure property" within the meaning of Section      
860G(a)(8) or result in the receipt by the Pooling-Tier REMIC-1 of any "income  
from non-permitted assets" within the meaning of Section 860F(a)(2)(B) of the   
Code or any "net income from foreclosure property" which is subject to taxation 
under Section 860G(a)(1) of the Code. Pursuant to its efforts to sell such REO  
Property, the applicable Servicer shall either itself or through an agent       
selected by such Servicer protect and conserve such REO Property in the same    
manner and to such extent as is customary in the locality where such REO        
Property is located and may, incident to its conservation and protection of the 
interests of the Trustee on behalf of the Certificateholders, rent the same, or 
any part thereof, as such Servicer deems to be in the best interest of the      
Trustee on behalf of the Certificateholders for the period prior to the sale of 
such REO Property; provided, however, that any rent received or accrued with    
respect to such REO Property qualifies as "rents from real property" as defined 
in Section 856(d) of the Code.                                                  

      Section 3.18 Notification of Adjustments. With respect to each
Adjustable Rate Mortgage Loan, the applicable Servicer shall adjust the Mortgage
Rate on the related Adjustment Date and shall adjust the Scheduled Payment on   
the related mortgage payment adjustment date, if applicable, in compliance with 
the requirements of applicable law and the related Mortgage and Mortgage Note.  
In the event that an Index becomes unavailable or otherwise unpublished, the    
related Servicer shall select a comparable alternative index over which it has  
no direct control and which is readily verifiable. Each Servicer shall execute  
and deliver any and all necessary notices required under applicable law and the 
terms of the related Mortgage Note and Mortgage regarding the Mortgage Rate and 
Scheduled Payment adjustments. Each Servicer shall promptly, upon written       
request therefor, deliver to the Trustee such notifications and any additional  
applicable data regarding such adjustments and the methods used to calculate and
implement such adjustments. Upon the discovery by a Servicer or the receipt of  
notice from the Trustee that a Servicer has failed to adjust a Mortgage Rate or 
Scheduled Payment in accordance with the terms of the related Mortgage Note,    
such Servicer shall deposit in the related Collection Account from its own funds
the amount of any interest loss caused as such interest loss occurs.            

    Section 3.19 Access to Certain Documentation and Information
Regarding the Mortgage Loans. The applicable Servicer shall provide, or cause   
the Subservicer to provide, to the Depositor, the Trustee, the OTS or the FDIC  
and the examiners and supervisory agents thereof, access to the documentation   
regarding the Mortgage Loans in its possession required by applicable           
regulations of the OTS. Such access shall be afforded without charge, but only  
upon five (5) Business Days' prior written request and during normal business   
hours at the offices of the applicable Servicer or any Subservicer. Nothing in  
this Section shall derogate from the obligation of any such party to observe any
applicable law prohibiting disclosure of information regarding the Mortgagors   
and the failure of any such party to provide access as provided in this Section 
as a result of such obligation shall not constitute a breach of this Section.   

      Section 3.20 Documents, Records and Funds in Possession of the
Servicers to Be Held for the Trustee. Each Servicer shall account fully to the  
Trustee for any funds received by such Servicer or which otherwise are collected
by such Servicer as Liquidation Proceeds, Condemnation Proceeds or Insurance    
Proceeds in respect of any Mortgage Loan serviced by such Servicer. All Mortgage
Files and funds collected or held by, or under the control of, a Servicer in    
respect of any Mortgage Loans, whether from the collection of principal and     
interest payments or from Liquidation Proceeds, including, but not limited to,  
any funds on deposit in its Collection Account, shall be held by such Servicer  
for and on behalf of the Trustee and shall be and remain the sole and exclusive 
property of the Trustee, subject to the applicable provisions of this Agreement.
Each Servicer also agrees that it shall not create, incur or subject any        
Mortgage File or any funds that are deposited in any Collection Account, the    
Distribution Account or any Escrow Account, or any funds that otherwise are or  
may become due or payable to the Trustee for the benefit of the                 
Certificateholders, to any claim, lien, security interest, judgment, levy, writ 
of attachment or other encumbrance, or assert by legal action or otherwise any  
claim or right of setoff against any Mortgage File or any funds collected on, or
in connection with, a Mortgage Loan, except, however, that such Servicer shall  
be entitled to set off against and deduct from any such funds any amounts that  
are properly due and payable to such Servicer under this Agreement.             

        Section 3.21 Servicing Compensation. (a) As compensation for its
activities hereunder, each Servicer shall, with respect to each Mortgage Loan   
serviced by it, be entitled to retain from deposits to its Collection Account   
and from Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds and REO
Proceeds related to such Mortgage Loan, the Servicing Fee with respect to each  
Mortgage Loan (less any portion of such amounts retained by any Subservicer). In
addition, each Servicer shall be entitled to recover unpaid Servicing Fees out  
of related late collections to the extent permitted in Section 3.11. The right  
to receive the Servicing Fee may not be transferred in whole or in part except  
in connection with the transfer of all of a Servicer's responsibilities and     
obligations under this Agreement; provided, however, that each Servicer may pay 
from the Servicing Fee any amounts due to a Subservicer pursuant to a           
Subservicing Agreement entered into under Section 3.02.                         

          (b) Additional servicing compensation in the form of assumption or
modification fees, late payment charges, NSF fees, reconveyance fees and other  
similar fees and charges (other than Prepayment Charges) shall be retained by a 
Servicer only to the extent such fees or charges are received by such Servicer. 
Each Servicer shall also be entitled pursuant to Section 3.11(a)(iv) to withdraw
from the related Collection Account, and pursuant to Section 3.07(e), to direct 
the Trustee to withdraw from the Distribution Account and remit to the          
applicable Servicer (except for monies invested during the Trustee Float        
Period), as additional servicing compensation, interest or other income earned  
on the related portions of deposits therein. Each Servicer shall also be        
entitled as additional servicing compensation, to interest or other income      
earned on deposits in the related Escrow Account (to the extent permitted by law
and the related Mortgage Loan documents) in accordance with Section 3.12. HomEq 
and JPMorgan shall also be entitled to retain net Prepayment Interest Excesses  
(to the extent not required to offset Prepayment Interest Shortfalls), but only 
to the extent such amounts are received by such Servicer.                       

           (c) Each Servicer shall be required to pay all expenses incurred by
it in connection with its servicing activities hereunder (including payment of  
premiums for any blanket policy insuring against hazard losses pursuant to      
Section 3.13, servicing compensation of the Subservicer to the extent not       
retained by it and the fees and expenses of independent accountants and any     
agents appointed by such Servicer), and shall not be entitled to reimbursement  
therefor from the Trust Fund except as specifically provided in Section 3.11.   

           Section 3.22 Annual Statement as to Compliance. Each Servicer shall
deliver or cause to be delivered, and shall cause each Subservicer engaged by   
such Servicer to deliver or cause to be delivered, to the Depositor, the Rating 
Agencies and the Trustee on or before March 5th of each calendar year,          
commencing in 2007, an Officer's Certificate stating, as to each signatory      
thereof, that (i) a review of the activities of the Servicer or Subservicer, as 
applicable, during the preceding calendar year and of its performance under this
Agreement or the applicable Subservicing Agreement, as the case may be, has been
made under such officers' supervision, and (ii) to the best of such officers'   
knowledge, based on such review, such Servicer or Subservicer, as applicable,   
has fulfilled all of its obligations under this Agreement or the applicable     
Subservicing Agreement, as the case may be, in all material respects, throughout
such year, or, if there has been a default in the fulfillment of any such       
obligation in any material respect, specifying each such default known to such  
officers and the nature and status thereof. Promptly after receipt of each such 
Officer's Certificate, the Depositor shall review each such Officer's           
Certificate and, if applicable, consult with the Trustee, Servicer or           
Subservicer as to the nature of any defaults by the Trustee, Servicer or any    
related Subservicer in the fulfillment of any of the Trustee's, such Servicer's 
or any related Subservicer's obligations. The obligations of the Trustee, each  
Servicer and each Subservicer under this Section apply to the Trustee, each     
Servicer and each Subservicer that acted as Trustee or serviced a Mortgage Loan,
as applicable, during the applicable period, whether or not the Trustee, such   
Servicer or such Subservicer is acting as the Trustee, a Servicer or a          
Subservicer at the time such Officer's Certificate is required to be delivered. 
None of the Trustee, Servicer or Subservicer shall be required to cause the     
delivery of any Officer's Certificate required by this Section until March 10th 
in any given year so long as it has received written confirmation from the      
Depositor that a Form 10-K is not required to be filed in respect of the Trust  
for the preceding calendar year.                                                

    Section 3.23 Annual Reports on Assessment of Compliance with
Servicing Criteria; Annual Independent Public Accountants' Attestation Report.  
(a) Not later than March 5th of each calendar year commencing in 2007, each     
Servicer and the Trustee shall deliver, and each Servicer shall cause each      
Subservicer engaged by such Servicer and such Servicer and the Trustee shall    
cause each Subcontractor utilized by such Servicer (or by any Subservicer) or   
the Trustee, as applicable, and determined by such Servicer or the Trustee, as  
applicable, pursuant to Section 3.02(e) to be "participating in a servicing     
function" within the meaning of Item 1122 of Regulation AB (in each case, a     
"Servicing Function Participant"), to deliver, each at its own expense, to the  
Depositor and the Trustee, a report on an assessment of compliance with the     
Servicing Criteria applicable to it that contains (A) a statement by such party 
of its responsibility for assessing compliance with the Servicing Criteria      
applicable to it, (B) a statement that such party used the Servicing Criteria to
assess compliance with the applicable Servicing Criteria, (C) such party's      
assessment of compliance with the applicable Servicing Criteria as of and for   
the period ending the end of the fiscal year covered by the Form 10-K required  
to be filed pursuant to Section 8.12, including, if there has been any material 
instance of noncompliance with the applicable Servicing Criteria, a discussion  
of each such failure and the nature and status thereof, and (D) a statement that
a registered public accounting firm has issued an attestation report on such    
Person's assessment of compliance with the applicable Servicing Criteria as of  
and for such period. Each such assessment of compliance report shall be         
addressed to the Depositor and signed by an authorized officer of the applicable
company, and shall address each of the applicable Servicing Criteria set forth  
on Exhibit P hereto, or as set forth in the notification furnished to the       
Depositor and the Trustee pursuant to Section 3.23(c). The Servicer and the     
Trustee hereby acknowledge and agree that their respective assessments of       
compliance will cover the items identified on Exhibit P hereto as being covered 
by such party. The parties to this Agreement acknowledge that where a particular
Servicing Criteria has multiple components, each party's assessment of          
compliance (and related attestation of compliance) will relate only to those    
components that are applicable to such party. Promptly after receipt of each    
such report on assessment of compliance, the Depositor shall review each such   
report and, if applicable, consult with the applicable Servicer or the Trustee  
as to the nature of any material instance of noncompliance with the Servicing   
Criteria applicable to it (and each Subservicer or Servicing Function           
Participant engaged or utilized by the applicable Servicer, such Subservicer or 
the Trustee, as applicable), as the case may be. None of the Servicers, the     
Trustee or any Subservicer or Servicing Function Participant shall be required  
to cause the delivery of any such assessments until March 10th in any given year
so long as it has received written confirmation from the Depositor that a Form  
10-K is not required to be filed in respect of the Trust for the preceding      
calendar year.                                                                  

        (b) Not later than March 5th of each calendar year commencing in
2007, the Trustee and each Servicer shall cause, and each Subservicer engaged by
the Servicer, and each Servicer and the Trustee shall cause each Servicing      
Function Participant utilized by the Trustee or such Servicer, as applicable (or
by any Subservicer engaged by such Servicer), to cause, each at its own expense,
a registered public accounting firm (which may also render other services to    
such party) and that is a member of the American Institute of Certified Public  
Accountants to furnish a report to the Trustee and the Depositor, with a copy to
the Rating Agencies, to the effect that (i) it has obtained a representation    
regarding certain matters from the management of such Person, which includes an 
assertion that such Person has complied with the Servicing Criteria applicable  
to it pursuant to Section 3.23(a) and (ii) on the basis of an examination       
conducted by such firm in accordance with standards for attestation engagements 
issued or adopted by the PCAOB, that attests to and reports on such Person's    
assessment of compliance with the Servicing Criteria applicable to it. In the   
event that an overall opinion cannot be expressed, such registered public       
accounting firm shall state in such report why it was unable to express such an 
opinion. Each such related accountant's attestation report shall be made in     
accordance with Rules 1-02(a)(3) and 2-02(g) of Regulation S-X under the        
Securities Act and the Exchange Act. Such report must be available for general  
use and not contain restricted use language. Promptly after receipt of each such
accountants' attestation report, the Depositor shall review the report and, if  
applicable, consult with the applicable Servicer or the Trustee as to the nature
of any defaults by the applicable Servicer or the Trustee (and each Subservicer 
or Servicing Function Participant engaged or utilized by any Servicer or the    
Trustee, as applicable, or by any Subservicer engaged by the Servicer), as the  
case may be, as the case may be, in the fulfillment of any of the Servicers',   
the Trustee's or the applicable Subservicer's or Servicing Function             
Participant's obligations hereunder or under any applicable sub-servicing       
agreement. None of the Servicers or the Trustee or any Servicing Function       
Participant shall be required to cause the delivery of any such attestation     
required by this paragraph until March 10th in any given year so long as it has 
received written confirmation from the Depositor that a Form 10-K is not        
required to be filed in respect of the Trust for the preceding calendar year.   

       (c) No later than February 1 of each fiscal year, commencing in
2007, each Servicer shall notify the Trustee and the Depositor as to the name of
each Subservicer engaged by it and each Servicing Function Participant utilized 
by it and by each Subservicer engaged by it, but only to the extent there has   
been a change in the information in such notification from notices previously   
delivered and the Trustee shall notify the Depositor as to the name of each     
Servicing Function Participant utilized by it and each such notice will specify 
what specific Servicing Criteria will be addressed in the report on assessment  
of compliance prepared by such Servicing Function Participant in each case, to  
the extent of any change from the prior year's notice, if any. When a Servicer  
or the Trustee submits its assessment pursuant to Section 3.23(a), such Servicer
and the Trustee, as applicable, will also at such time include the assessment   
(and related attestation pursuant to Section 3.23(b)) of each Servicing Function
Participant utilized by it and by each Subservicer engaged by it.               

       Section 3.24 Trustee to Act as Servicer. (a) Subject to Section
7.02, in the event that any Servicer shall for any reason no longer be a        
Servicer hereunder (including by reason of an Event of Default), the Trustee or 
its successor shall thereupon assume all of the rights and obligations of such  
Servicer hereunder arising thereafter (except that the Trustee shall not be (i) 
liable for losses of such predecessor servicer pursuant to Section 3.10 or any  
acts or omissions of such predecessor servicer hereunder), (ii) obligated to    
effectuate repurchases or substitutions of Mortgage Loans hereunder, including  
but not limited to repurchases or substitutions pursuant to Section 2.03, (iii) 
responsible for expenses of such predecessor servicer pursuant to Section 2.03  
or (iv) deemed to have made any representations and warranties of such Servicer 
hereunder. Any such assumption shall be subject to Section 7.02.                

         (b) Every Subservicing Agreement entered into by a Servicer shall
contain a provision giving the successor Servicer the option to terminate such  
agreement in the event a successor Servicer is appointed.                       

        (c) If any Servicer shall for any reason no longer be a Servicer
(including by reason of any Event of Default), the Trustee (or any other        
successor servicer) may, at its option, succeed to any rights and obligations of
such Servicer under any Subservicing Agreement in accordance with the terms     
thereof; provided that the Trustee (or any other successor servicer) shall not  
incur any liability or have any obligations in its capacity as successor        
servicer under a Subservicing Agreement arising prior to the date of such       
succession unless it expressly elects to succeed to the rights and obligations  
of such Servicer thereunder; and such Servicer shall not thereby be relieved of 
any liability or obligations under the Subservicing Agreement arising prior to  
the date of such succession.                                                    

           (d) The applicable Servicer shall, upon request of the Trustee, but
at the expense of such Servicer, deliver to the assuming party all documents and
records relating to each Subservicing Agreement (if any) to which it is party   
and the Mortgage Loans then being serviced thereunder and an accounting of      
amounts collected and held by it and otherwise use its best efforts to effect   
the orderly and efficient transfer of such Subservicing Agreement to the        
assuming party.                                                                 

            Section 3.25 Compensating Interest. Each Servicer shall remit to the
Trustee on each Remittance Date for deposit in the Distribution Account an      
amount from its own funds equal to the Compensating Interest payable by such    
Servicer for the related Distribution Date.                                     

       Section 3.26 Credit Reporting; Gramm-Leach-Bliley Act. (a) With
respect to each Mortgage Loan, each Servicer agrees to fully 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 TransUnion Credit Information    
Company (three of the credit repositories), on a monthly basis.                 

(b) Each Servicer shall comply with Title V of the      
Gramm-Leach-Bliley Act of 1999 and all applicable regulations promulgated       
thereunder, relating to the Mortgage Loans required to be serviced by it and the
related borrowers and shall provide all required notices thereunder.            

ARTICLE IV

 DISTRIBUTIONS AND
 ADVANCES BY THE SERVICERS

           Section 4.01 Advances. (a) The amount of P&I Advances to be made by
each Servicer for any Remittance Date shall equal, subject to Section 4.01(c),  
the sum of (i) the aggregate amount of Scheduled Payments (with each interest   
portion thereof net of the related Servicing Fee), due during the Due Period    
immediately preceding such Remittance Date in respect of the Mortgage Loans     
serviced by such Servicer, which Scheduled Payments were not received as of the 
close of business on the related Determination Date (provided, however, that    
with respect to any Balloon Loan that is delinquent on its maturity date, the   
applicable Servicer will not be required to advance the principal portion of the
related balloon payment but will be required to continue to make P&I Advances in
accordance with this Section 4.01(a) with respect to such Balloon Loan in an    
amount equal to the assumed scheduled interest that would otherwise be due based
on the original amortization schedule for such Balloon Loan (with interest at   
the Adjusted Net Mortgage Rate)), plus (ii) with respect to each REO Property   
serviced by such Servicer, which REO Property was acquired during or prior to   
the related Prepayment Period and as to which such REO Property an REO          
Disposition did not occur during the related Prepayment Period, an amount equal 
to the excess, if any, of the Scheduled Payments (with each interest portion    
thereof net of the related Servicing Fee) that would have been due on the       
related Due Date in respect of the related Mortgage Loans, over the net income  
from such REO Property transferred to the related Collection Account for        
distribution on such Remittance Date.                                           

 (b) On each Remittance Date, each Servicer shall remit in
immediately available funds to the Trustee an amount equal to the aggregate     
amount of P&I Advances, if any, to be made in respect of the Mortgage Loans and 
REO Properties serviced by such Servicer for the related Remittance Date either 
(i) from its own funds or (ii) from the related Collection Account, to the      
extent of funds held therein for future distribution (in which case, it will    
cause to be made an appropriate entry in the records of the related Collection  
Account that Amounts Held for Future Distribution have been, as permitted by    
this Section 4.01, used by such Servicer in discharge of any such P&I Advance)  
or (iii) in the form of any combination of (i) and (ii) aggregating the total   
amount of P&I Advances to be made by such Servicer with respect to such Mortgage
Loans and REO Properties. Any Amounts Held for Future Distribution and so used  
shall be appropriately reflected in such Servicer's records and replaced by such
Servicer by deposit in the related Collection Account on or before any future   
Remittance Date to the extent required.                                         

        (c) The obligation of each Servicer to make such P&I Advances is
mandatory, notwithstanding any other provision of this Agreement but subject to 
paragraph (d) below, and, with respect to any Mortgage Loan or REO Property,    
shall continue until a Final Recovery Determination in connection therewith or  
the removal thereof from coverage under this Agreement, except as otherwise     
provided in this Section.                                                       

           (d) Notwithstanding anything herein to the contrary, no P&I Advance
or Servicing Advance shall be required to be made hereunder by any Servicer if  
such P&I Advance or Servicing Advance would, if made, constitute a              
Nonrecoverable P&I Advance or Nonrecoverable Servicing Advance. The             
determination by any Servicer that it has made a Nonrecoverable P&I Advance or a
Nonrecoverable Servicing Advance or that any proposed P&I Advance or Servicing  
Advance, if made, would constitute a Nonrecoverable P&I Advance or a            
Nonrecoverable Servicing Advance, respectively, shall be evidenced by an        
Officer's Certificate of such Servicer delivered to the Trustee. (e) Except as  
otherwise provided herein, the applicable Servicer shall be entitled to         
reimbursement pursuant to Section 3.11 for Servicing Advances from recoveries   
from the related Mortgagor or from all Liquidation Proceeds and other payments  
or recoveries (including Insurance Proceeds and Condemnation Proceeds) with     
respect to the related Mortgage Loan.                                           

         Section 4.02 Priorities of Distribution. (a) On each Distribution
Date, the Trustee shall allocate from amounts then on deposit in the            
Distribution Account in the following order of priority and to the extent of the
Available Funds remaining and, on such Distribution Date, shall make            
distributions on the Certificates in accordance with such allocation:           

           (i) to the holders of each Class of Offered Certificates and to the
Swap Account in the following order of priority:                    

                 (A) to the Swap Account, the sum of (x) all Net Swap Payments
       and (y) any Swap Termination Payment owed to the Swap Provider,
            including, without limitation, any Senior Defaulted Swap Termination
      Payment but not including any other Defaulted Swap Termination
Payment;                                                

            (B) to the Class A-1, Class A-2, Class A-3 and Class A-4
           Certificates, the related Accrued Certificate Interest Distribution
Amounts and any related Unpaid Interest Amounts for such
       Distribution Date, allocated pro rata based on their respective
entitlements to those amounts;                          

              (C) from any remaining Interest Remittance Amounts, to the
Class M-1 Certificates, the Accrued Certificate Interest
     Distribution Amount for such Class on such Distribution Date;

              (D) from any remaining Interest Remittance Amounts, to the
Class M-2 Certificates, the Accrued Certificate Interest
     Distribution Amount for such Class on such Distribution Date;

              (E) from any remaining Interest Remittance Amounts, to the
Class M-3 Certificates, the Accrued Certificate Interest
     Distribution Amount for such Class on such Distribution Date;

              (F) from any remaining Interest Remittance Amounts, to the
Class M-4 Certificates, the Accrued Certificate Interest
     Distribution Amount for such Class on such Distribution Date;

              (G) from any remaining Interest Remittance Amounts, to the
Class M-5 Certificates, the Accrued Certificate Interest
     Distribution Amount for such Class on such Distribution Date;

              (H) from any remaining Interest Remittance Amounts, to the
Class M-6 Certificates, the Accrued Certificate Interest
     Distribution Amount for such Class on such Distribution Date;

              (I) from any remaining Interest Remittance Amounts, to the
Class B-1 Certificates, the Accrued Certificate Interest
     Distribution Amount for such Class on such Distribution Date;

              (J) from any remaining Interest Remittance Amounts, to the
Class B-2 Certificates, the Accrued Certificate Interest
         Distribution Amount for such Class on such Distribution Date; and

              (K) from any remaining Interest Remittance Amounts, to the
Class B-3 Certificates, the Accrued Certificate Interest
     Distribution Amount for such Class on such Distribution Date;

          (ii) (A) on each Distribution Date (1) before the Stepdown Date or
     (2) with respect to which a Trigger Event is in effect, to the holders of
 the related Class or Classes of Offered Certificates then entitled to
    distributions of principal as set forth below, from amounts remaining on
      deposit in the Distribution Account after making distributions pursuant to
     clause (i) above, an amount equal to the Principal Distribution Amount in
the following order of priority:                                    

              (1) to the Class A Certificates, allocated as described in
        Section 4.02(b), until the respective Class Certificate Balances
thereof are reduced to zero; and                        

                  (2) sequentially to the Class M-1, Class M-2, Class M-3, Class
     M-4, Class M-5, Class M-6, Class B-1, Class B-2 and Class B-3
           Certificates, in that order, until the respective Class Certificate
Balances are reduced to zero;                           

            (B) on each Distribution Date (1) on and after the Stepdown Date and
  (2) as long as a Trigger Event is not in effect, to the holders of the
related Class or Classes of Offered Certificates then entitled to   
distribution of principal, from amounts remaining on deposit in the 
  Distribution Account after making distributions pursuant to clause (i)
   above, an amount equal to, in the aggregate, the Principal Distribution
Amount in the following amounts and order of priority:              

          (1) to the Class A Certificates, the lesser of (x) the
   Principal Distribution Amount and (y) the Class A Principal
       Distribution Amount, allocated as described in Section 4.02(b),
           until the respective Class Certificate Balances thereof are reduced
to zero;                                                

            (2) to the Class M-1 Certificates, the lesser of (x) the
            excess of (i) the Principal Distribution Amount over (ii) the amount
          distributed to the Class A Certificateholders in clause (ii)(B)(a)
            above and (y) the Class M-1 Principal Distribution Amount, until the
   Class Certificate Balance thereof has been reduced to zero;

            (3) to the Class M-2 Certificates, the lesser of (x) the
            excess of (i) the Principal Distribution Amount over (ii) the amount
          distributed to the Class A Certificateholders in clause (ii)(B)(a)
          above and to the Class M-1 Certificates in clause (ii)(B)(b) above
            and (y) the Class M-2 Principal Distribution Amount, until the Class
Certificate Balance thereof has been reduced to zero;   

            (4) to the Class M-3 Certificates, the lesser of (x) the
            excess of (i) the Principal Distribution Amount over (ii) the amount
          distributed to the Class A Certificateholders in clause (ii)(B)(a)
           above, to the Class M-1 Certificates in clause (ii)(B)(b) above and
            to the Class M-2 Certificates in clause (ii)(B)(c) above and (y) the
            Class M-3 Principal Distribution Amount, until the Class Certificate
Balance thereof has been reduced to zero;               

            (5) to the Class M-4 Certificates, the lesser of (x) the
            excess of (i) the Principal Distribution Amount over (ii) the amount
          distributed to the Class A Certificateholders in clause (ii)(B)(a)
           above, to the Class M-1 Certificates in clause (ii)(B)(b) above, to
        the Class M-2 Certificates in clause (ii)(B)(c) above and to the
           Class M-3 Certificates in clause (ii)(B)(d) above and (y) the Class
      M-4 Principal Distribution Amount, until the Class Certificate
Balance thereof has been reduced to zero;               

            (6) to the Class M-5 Certificates, the lesser of (x) the
            excess of (i) the Principal Distribution Amount over (ii) the amount
          distributed to the Class A Certificateholders in clause (ii)(B)(a)
           above, to the Class M-1 Certificates in clause (ii)(B)(b) above, to
           the Class M-2 Certificates in clause (ii)(B)(c) above, to the Class
        M-3 Certificates in clause (ii)(B)(d) above and to the Class M-4
     Certificates in clause (ii)(B)(e) above and (y) the Class M-5
          Principal Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;                       

            (7) to the Class M-6 Certificates, the lesser of (x) the
            excess of (i) the Principal Distribution Amount over (ii) the amount
          distributed to the Class A Certificateholders in clause (ii)(B)(a)
           above, to the Class M-1 Certificates in clause (ii)(B)(b) above, to
           the Class M-2 Certificates in clause (ii)(B)(c) above, to the Class
     M-3 Certificates in clause (ii)(B)(d) above, to the Class M-4
    Certificates in clause (ii)(B)(e) above and to the Class M-5
     Certificates in clause (ii)(B)(f) above and (y) the Class M-6
          Principal Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;                       

            (8) to the Class B-1 Certificates, the lesser of (x) the
            excess of (i) the Principal Distribution Amount over (ii) the amount
          distributed to the Class A Certificateholders in clause (ii)(B)(a)
           above, to the Class M-1 Certificates in clause (ii)(B)(b) above, to
           the Class M-2 Certificates in clause (ii)(B)(c) above, to the Class
     M-3 Certificates in clause (ii)(B)(d) above, to the Class M-4
 Certificates in clause (ii)(B)(e) above, to the Class M-5
    Certificates in clause (ii)(B)(f) above and to the Class M-6
     Certificates in clause (ii)(B)(g) above and (y) the Class B-1
          Principal Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;                       

            (9) to the Class B-2 Certificates, the lesser of (x) the
            excess of (i) the Principal Distribution Amount over (ii) the amount
          distributed to the Class A Certificateholders in clause (ii)(B)(a)
           above, to the Class M-1 Certificates in clause (ii)(B)(b) above, to
           the Class M-2 Certificates in clause (ii)(B)(c) above, to the Class
     M-3 Certificates in clause (ii)(B)(d) above, to the Class M-4
 Certificates in clause (ii)(B)(e) above, to the Class M-5
 Certificates in clause (ii)(B)(f) above, to the Class M-6
    Certificates in clause (ii)(B)(g) above and to the Class B-1
     Certificates in clause (ii)(B)(h) above and (y) the Class B-2
          Principal Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero; and                   

             (10) to the Class B-3 Certificates, the lesser of (x) the
            excess of (i) the Principal Distribution Amount over (ii) the amount
          distributed to the Class A Certificateholders in clause (ii)(B)(a)
           above, to the Class M-1 Certificates in clause (ii)(B)(b) above, to
           the Class M-2 Certificates in clause (ii)(B)(c) above, to the Class
     M-3 Certificates in clause (ii)(B)(d) above, to the Class M-4
 Certificates in clause (ii)(B)(e) above, to the Class M-5
 Certificates in clause (ii)(B)(f) above, to the Class M-6
 Certificates in clause (ii)(B)(g) above, to the Class B-1
    Certificates in clause (ii)(B)(h) above and to the Class B-2
     Certificates in clause (ii)(B)(i) above and (y) the Class B-3
          Principal Distribution Amount, until the Class Certificate Balance
thereof has been reduced to zero;                       

                 (iii) any amount remaining after the distributions in clauses
      (i) and (ii) above, plus as specifically indicated below, from
       amounts on deposit in the Excess Reserve Fund Account, shall be
distributed in the following order of priority:         

                      (A) to the Class M-1 Certificates, any Unpaid Interest
Amount for such Class;                      

                      (B) to the Class M-1 Certificates, any Unpaid Realized
Loss Amount for such Class;                 

                      (C) to the Class M-2 Certificates, any Unpaid Interest
Amount for such Class;                      

                      (D) to the Class M-2 Certificates, any Unpaid Realized
Loss Amount for such Class;                 

                      (E) to the Class M-3 Certificates, any Unpaid Interest
Amount for such Class;                      

                      (F) to the Class M-3 Certificates, any Unpaid Realized
Loss Amount for such Class;                 

                      (G) to the Class M-4 Certificates, any Unpaid Interest
Amount for such Class;                      

                      (H) to the Class M-4 Certificates, any Unpaid Realized
Loss Amount for such Class;                 

                      (I) to the Class M-5 Certificates, any Unpaid Interest
Amount for such Class;                      

                      (J) to the Class M-5 Certificates, any Unpaid Realized
Loss Amount for such Class;                 

                      (K) to the Class M-6 Certificates, any Unpaid Interest
Amount for such Class;                      

                      (L) to the Class M-6 Certificates, any Unpaid Realized
Loss Amount for such Class;                 

                      (M) to the Class B-1 Certificates, any Unpaid Interest
Amount for such Class;                      

                      (N) to the Class B-1 Certificates, any Unpaid Realized
Loss Amount for such Class;                 

                      (O) to the Class B-2 Certificates, any Unpaid Interest
Amount for such Class;                      

                      (P) to the Class B-2 Certificates, any Unpaid Realized
Loss Amount for such Class;                 

                      (Q) to the Class B-3 Certificates, any Unpaid Interest
Amount for such Class;                      

                      (R) to the Class B-3 Certificates, any Unpaid Realized
Loss Amount for such Class;                 

                     (S) to the Excess Reserve Fund Account, the amount of
                any Basis Risk Payment (without regard to Net Swap Receipts)
for such Distribution Date;                 

                    (T) from funds on deposit in the Excess Reserve Fund
             Account with respect to such Distribution Date, an amount
              equal to any remaining Basis Risk CarryForward Amount with
             respect to the Offered Certificates for such Distribution
                 Date, allocated to the Offered Certificates in the same order
          and priority in which the Accrued Certificate Interest
          Distribution Amount is allocated among such Classes of
                 Certificates, with the allocation to the Class A Certificates
              being (a) first, among the Class A Certificates, pro rata,
                based on their respective Class Certificate Balances and (b)
                  second, any remaining amounts to the Class A Certificates, pro
                rata, based on any Basis Risk CarryForward Amounts remaining
      unpaid, in order to reimburse such unpaid amounts;

                    (U) to the Swap Account, the amount of any remaining
                 Defaulted Swap Termination Payment owed to the Swap Provider;

                     (V) to the Class X Certificates, the remainder of the
            Class X Distributable Amount not distributed pursuant to
Sections 4.02(a)(iii)(A)-(U); and           

                        (W) to the Class R Certificates, any remaining amount in
the Trust REMICs.                           

            If on any Distribution Date, as a result of the foregoing allocation
rules, any Class of Class A Certificates does not receive in full the related   
Accrued Certificate Interest Distribution Amount or the related Unpaid Interest 
Amount, if any, then such shortfall will be allocated to the Holders of such    
Class, with interest thereon, on future Distribution Dates, as an Unpaid        
Interest Amount, subject to the priorities described above.                     

        (b) On each Distribution Date, prior to any distributions on any
other Class of Certificates, all amounts representing Prepayment Charges from   
the Mortgage Loans received during the related Prepayment Period shall be       
distributed by the Trustee to the holders of the Class P Certificates.          

         Any principal distributions allocated to the Class A Certificates
shall be allocated sequentially, first to the Class A-1 Certificates, until     
their Class Certificate Balance has been reduced to zero, then to the Class A-2 
Certificates, until their Class Certificate Balance has been reduced to zero,   
then to the Class A-3 Certificates, until their Class Certificate Balance has   
been reduced to zero and then to the Class A-4 Certificates, until their Class  
Certificate Balance has been reduced to zero. Notwithstanding the foregoing, on 
and after the Distribution Date on which the aggregate Class Certificate        
Balances of the Subordinated Certificates and the principal balance of the Class
X Certificates have been reduced to zero, any principal distributions allocated 
to the Class A Certificates shall be allocated, pro rata among the Class A      
Certificates, based on their respective Class Certificate Balances, until their 
respective Class Certificate Balances have been reduced to zero.                

       (c) On any Distribution Date, any Relief Act Shortfalls and Net
Prepayment Interest Shortfalls for such Distribution Date shall be allocated by 
the Trustee as a reduction in the following order:                              

     (1)   First, to the amount of interest payable to the Class X
Certificates; and                           

         (2)   Second, pro rata, as a reduction of the Accrued Certificate
             Interest Distribution Amount for the Class A, Class M and
                  Class B Certificates, based on the amount of interest to which
such Classes would otherwise be entitled.   

            Section 4.03 Monthly Statements to Certificateholders. (a) Not later
than each Distribution Date, the Trustee shall make available to each           
Certificateholder, the Servicers, the Depositor and each Rating Agency a        
statement setting forth with respect to the related distribution:               

      (i) the actual Distribution Date, the related Record Date, the
    Interest Accrual Period(s) for each Class for such Distribution Date and
the LIBOR Determination Date for such Interest Accrual Period;      

(ii) the amount of Available Funds;                     

       (iii) the amount of Available Funds allocable to principal, the
Principal Remittance Amount (separately identifying the components  
      thereof) and the Principal Distribution Amount (separately identifying the
components thereof);                                                

         (iv) the amount of Available Funds allocable to interest and each
Interest Remittance Amount;                                         

            (v) the amount of any Unpaid Interest Amount for each Class included
in such distribution and any remaining Unpaid Interest Amounts after
  giving effect to such distribution, any Basis Risk CarryForward Amount
for each Class and the amount of such Basis Risk CarryForward Amount
covered by withdrawals from the Excess Reserve Fund Account on such 
Distribution Date;                                                  

(vi) if the distribution to the Holders of such Class of
    Certificates is less than the full amount that would be distributable to
      such Holders if there were sufficient funds available therefor, the amount
     of the shortfall and the allocation of the shortfall as between principal
     and interest, including any Basis Risk CarryForward Amount not covered by
amounts in the Excess Reserve Fund Account;                         

         (vii) the Class Certificate Balance of each Class of Certificates
   before and after giving effect to the distribution of principal on such
Distribution Date;                                                  

(viii) the Pool Stated Principal Balance for the related
Distribution Date;                                                  

            (ix) the amount of Expense Fees paid to or retained by the Servicers
    and the Trustee (stated separately and in the aggregate) with respect to
such Distribution Date;                                             

          (x) the Pass-Through Rate for each such Class of Certificates with
respect to such Distribution Date;                                  

        (xi) the amount of Advances included in the distribution on such
     Distribution Date reported by the Servicers (and the Trustee as successor
     servicer and any other successor servicer, if applicable) as of the close
of business on the Determination Date immediately preceding such    
Distribution Date;                                                  

        (xii) the number and aggregate outstanding principal balances of
    Mortgage Loans (1) as to which the Scheduled Payment is delinquent 31 to
     60 days, 61 to 90 days, 91 to 120 days, 121 to 150 days, 151 to 180 days,
    181 to 210 days, 211 to 240 days and 240+ days, (2) that have become REO
    Property, (3) that are in foreclosure and (4) that are in bankruptcy, in
    each case as of the close of business on the last day of the related Due
Period;                                                             

            (xiii) for each of the preceding 12 calendar months, or all calendar
   months since the related Cut-off Date, whichever is less, the aggregate
dollar amount of the Scheduled Payments (A) due on all outstanding  
Mortgage Loans on each of the Due Dates in each such month and (B)  
   delinquent 60 days or more on each of the Due Dates in each such month;

           (xiv) with respect to any Mortgage Loans that became REO Properties
      during the preceding calendar month, the aggregate number of such Mortgage
  Loans and the aggregate outstanding principal balance of such Mortgage
Loans as of the close of business on the last day of the related Due
Period;                                                             

          (xv) the total number and outstanding principal balance of any REO
      Properties (and market value, if available) as of the close of business on
the last Business Day of the related Due Period;                    

    (xvi) whether a Trigger Event has occurred and is continuing
      (separately identifying the components of the calculation resulting in the
   existence of the Trigger Event and the aggregate outstanding balance of
all 60+ Day Delinquent Mortgage Loans);                             

       (xvii) the amount on deposit in the Excess Reserve Fund Account
(after giving effect to distributions on such Distribution Date);   

        (xviii) in the aggregate and for each Class of Certificates, the
 aggregate amount of Applied Realized Loss Amounts incurred during the
preceding calendar month and aggregate Applied Realized Loss Amounts
through such Distribution Date;                                     

    (xix) the amount of any Net Monthly Excess Cash Flow on such
     Distribution Date and the allocation of it to the Certificateholders with
  respect to Unpaid Interest Amounts, Applied Realized Loss Amounts, and
Basis Risk CarryForward Amounts;                                    

         (xx) the amount of any Net Swap Payments, Net Swap Receipts, Swap
Termination Payments or Defaulted Swap Termination Payments;        

(xxi) the calculations of LIBOR and Swap LIBOR;         

         (xxii) the Subordinated Amount and Specified Subordinated Amount;

         (xxiii) Prepayment Charges collected or paid (pursuant to Section
3.07(a)) by the Servicers;                                          

         (xxiv) the Cumulative Loss Percentage and the aggregate amount of
Realized Losses used to calculate the Cumulative Loss Percentage;   

 (xxv) the amount distributed on the Class X Certificates;

            (xxvi) the amount of any Subsequent Recoveries for such Distribution
Date; and                                                           

            (xxvii) the number of Mortgage Loans at the beginning and end of the
    applicable reporting period, the pool factor (being the Stated Principal
      Balance of the Mortgage Loans for the related Distribution Date divided by
  the Cut-off Date Principal Balance), and the weighted average interest
rate, and weighted average remaining term.                          

     In addition, each Form 10-D prepared and filed by the Trustee
pursuant to Section 8.12 shall include the following information with respect to
the related distribution:                                                       

  (i) material breaches of Mortgage Loan representations and
     warranties under this Agreement of which the Trustee has actual knowledge
or has received written notice; and                                 

       (ii) material breaches of any covenants under this Agreement of
  which the Trustee has actual knowledge or has received written notice.

          (b) The Trustee's responsibility for providing the above statement
to the Certificateholders, each Rating Agency, and the Depositor is limited, if 
applicable, to the availability, timeliness and accuracy of the information     
derived from the Servicers and the Responsible Parties. The Trustee shall make  
available the above statement via the Trustee's internet website. The Trustee's 
website will initially be located at https://www.tss.db.com/invr and assistance 
in using the website can be obtained by calling the Trustee's investor relations
desk at 1-800-735-7777. Parties that are unable to use the website are entitled 
to have a paper copy mailed to them via first class mail by calling the investor
relations desk and indicating such. The Trustee may change the way the monthly  
statements to Certificateholders are distributed in order to make such          
distribution more convenient and/or more accessible to the above parties and the
Trustee shall provide timely and adequate notification to all above parties     
regarding any such changes. As a condition to access the Trustee's internet     
website, the Trustee may require registration and the acceptance of a           
disclaimer. The Trustee will not be liable for the dissemination of information 
in accordance with this Agreement.                                              

          The Trustee shall make available to each Analytics Company, either
electronically or via the Trustee's internet website, each statement to         
Certificateholders prepared pursuant to this Section 4.03(a). The Trustee (and  
the Servicer, if such discrepany results from or arises out of any information  
provided by the Servicer pursuant to this Agreement) shall cooperate in good    
faith with the Depositor to reconcile any discrepancies in such statements, and 
the Trustee shall provide any corrections to such statements to each Analytics  
Company as soon as reasonably practicable after the related Distribution Date.  

     The Trustee will also be entitled to rely on but shall not be
responsible for the content or accuracy of any information provided by third    
parties for purposes of preparing the monthly statement to Certificateholders   
and may affix thereto any disclaimer it deems appropriate in its reasonable     
discretion (without suggesting liability on the part of any other party hereto).

    (c) Within a reasonable period of time after the end of each
calendar year, the Trustee shall cause to be furnished to each Person who at any
time during the calendar year was a Certificateholder, a statement containing   
the information set forth in clauses (a)(i) and (a)(ii) of this Section 4.03    
aggregated for such calendar year or applicable portion thereof during which    
such Person was a Certificateholder. Such obligation of the Trustee shall be    
deemed to have been satisfied to the extent that substantially comparable       
information shall be provided by the Trustee pursuant to any requirements of the
Code as from time to time in effect.                                            

       (d) Not later than the Determination Date for each Distribution
Date, each Servicer shall furnish to the Depositor with respect to clause (i)   
below and to the Trustee, the Depositor and the Responsible Party with respect  
to clause (ii) below, a monthly remittance advice statement (the "Servicer      
Remittance Report") (in a format mutually agreed upon by such Servicer, the     
Trustee and the Depositor) containing such information as shall be reasonably   
requested (i) by the Depositor and the Responsible Party to enable the Depositor
to disclose "static pool information", as required by Item 1105 of Regulation   
AB, with respect to the Mortgage Loans, and (ii) by the Trustee to enable the   
Trustee to provide the reports required by Section 4.03(a) as to the            
accompanying remittance and the period ending on the close of business on the   
last day of the related Prepayment Period.                                      

        The Servicer Remittance Report shall, at a minimum, document, on
such Determination Date, Mortgage Loan payment activity on an individual        
Mortgage Loan basis, as follows:                                                

      (i) with respect to each Scheduled Payment, the amount of such
    remittance allocable to principal (including a separate breakdown of any
Principal Prepayment, including the date of such prepayment, and any
   Prepayment Charges, received during the related Prepayment Period along
with a detailed report of interest on principal prepayment amounts  
remitted in accordance with Section 3.25);                          

       (ii) with respect to each Scheduled Payment, the amount of such
remittance allocable to interest;                                   

            (iii) the amount of servicing compensation received by such Servicer
during the prior distribution period;                               

         (iv) the individual and aggregate Stated Principal Balance of the
Mortgage Loans;                                                     

         (v) the aggregate expenses reimbursed to such Servicer during the
prior distribution period pursuant to Section 3.11; and             

       (vi) the number and aggregate outstanding principal balances of
 Mortgage Loans (a) delinquent 31 to 60 days, 61 to 90 days, 91 to 120
    days, 121 to 150 days, 151 to 180 days, 181 to 210 days, 211 to 240 days
   and 240+ days; (b) as to which foreclosure or bankruptcy proceedings of
      the related mortgagor have commenced; and (c) as to which REO Property has
been acquired.                                                      

        (e) Notwithstanding anything in Section 4.03(d) to the contrary,
JPMorgan shall be deemed to have satisfied the requirement to timely deliver the
Servicer Remittance Report set forth in Section 4.03(d) above if the Trustee and
the Depositor receive such report on or prior to the 18th day of the calendar   
month in which the related Determination Date occurs; provided, however, that if
such day is not a Business Day, JPMorgan shall be deemed to have satisfied the  
requirement to timely deliver the Servicer Remittance Report set forth in       
Section 4.03(d) above if the Trustee and the Depositor receive such report (i)  
on the next Business Day succeeding such 18th day, if such succeeding Business  
Day is not later than the 20th day of such calendar month or (ii) on the        
Business Day immediately preceding such 18th day, if such succeeding Business   
Day is later than the 20th day of such calendar month.                          

            (f) For all purposes of this Agreement, with respect to any Mortgage
Loan, delinquencies shall be determined and reported based on the so-called     
"OTS" methodology for determining delinquencies on mortgage loans similar to the
Mortgage Loans. By way of example, a Mortgage Loan would be delinquent with     
respect to a Scheduled Payment due on a Due Date if such Scheduled Payment is   
not made by the close of business on the Mortgage Loan's next succeeding Due    
Date, and a Mortgage Loan would be more than 30-days Delinquent with respect to 
such Scheduled Payment if such Scheduled Payment were not made by the close of  
business on the Mortgage Loan's second succeeding Due Date. Each Servicer hereby
represents and warrants to the Depositor that this delinquency recognition      
policy is not less restrictive than any delinquency recognition policy          
established by the primary safety and soundness regulator, if any, of such      
Servicer.                                                                       

            Section 4.04 Certain Matters Relating to the Determination of LIBOR.
LIBOR shall be calculated by the Trustee in accordance with the definition of   
"LIBOR". Until all of the Offered Certificates are paid in full, the Trustee    
shall at all times retain at least four Reference Banks for the purpose of      
determining LIBOR with respect to each LIBOR Determination Date. The Trustee    
initially shall designate the Reference Banks (after consultation with the      
Depositor). Each "Reference Bank" shall be a leading bank engaged in            
transactions in Eurodollar deposits in the international Eurocurrency market,   
shall not control, be controlled by, or be under common control with, the       
Trustee and shall have an established place of business in London. If any such  
Reference Bank should be unwilling or unable to act as such or if the Trustee   
should terminate its appointment as Reference Bank, the Trustee shall promptly  
appoint or cause to be appointed another Reference Bank (after consultation with
the Depositor). The Trustee shall have no liability or responsibility to any    
Person for (i) the selection of any Reference Bank for purposes of determining  
LIBOR or (ii) any inability to retain at least four Reference Banks which is    
caused by circumstances beyond its reasonable control.                          

        The Pass-Through Rate for each Class of Offered Certificates for
each Interest Accrual Period shall be determined by the Trustee on each LIBOR   
Determination Date so long as the Offered Certificates are Outstanding on the   
basis of LIBOR and the respective formulae appearing in footnotes corresponding 
to the Offered Certificates in the table relating to the Certificates in the    
Preliminary Statement. The Trustee shall not have any liability or              
responsibility to any Person for its inability, following a good-faith          
reasonable effort, to obtain quotations from the Reference Banks or to determine
the arithmetic mean referred to in the definition of LIBOR, all as provided for 
in this Section 4.04 and the definition of LIBOR. The establishment of LIBOR and
each Pass-Through Rate for the Offered Certificates by the Trustee shall (in the
absence of manifest error) be final, conclusive and binding upon each Holder of 
a Certificate and the Trustee.                                                  

     Section 4.05 Allocation of Applied Realized Loss Amounts. Any
Applied Realized Loss Amounts shall be allocated by the Trustee to the most     
junior Class of Subordinated Certificates then Outstanding in reduction of the  
Class Certificate Balance thereof.                                              

         Section 4.06 Swap Account. On the Closing Date, the Trustee shall
establish and maintain in its name, a separate non-interest bearing trust       
account for the benefit of the holders of the Certificates (the "Swap Account") 
as a part of the Trust Fund. The Swap Account shall be an Eligible Account, and 
funds on deposit therein shall be held separate and apart from, and shall not be
commingled with, any other moneys, including, without limitation, other moneys  
of the Trustee held pursuant to this Agreement.                                 

     On any Distribution Date, Swap Termination Payments, Net Swap
Payments owed to the Swap Provider and Net Swap Receipts for that Distribution  
Date will be deposited into the Swap Account. Funds in the Swap Account will be 
distributed in the following order of priority:                                 

            (i) to the Swap Provider, all Net Swap Payments, if any, owed to the
Swap Provider for that Distribution Date;                           

           (ii) to the Swap Provider, any Swap Termination Payment, including,
     without limitation, any Senior Defaulted Swap Termination Payment but not
   including any other Defaulted Swap Termination Payment owed to the Swap
Provider for that Distribution Date;                                

     (iii) to the Class A Certificates, to pay Accrued Certificate
 Interest Distribution Amounts and, if applicable, any Unpaid Interest
 Amounts as described in Section 4.02(a)(i), to the extent unpaid from
Available Funds;                                                    

        (iv) sequentially, to the Class M-1, Class M-2, Class M-3, Class
M-4, Class M-5, Class M-6, Class B-1, Class B-2 and Class B-3       
Certificates, in that order, to pay Accrued Certificate Interest    
   Distribution Amounts and, if applicable, any Unpaid Interest Amounts as
   described in Section 4.02(a)(i) and Section 4.02(a)(iii), to the extent
unpaid from Available Funds;                                        

           (v) to the Offered Certificates, to pay principal as described and,
in the same manner and order of priority as set forth, in Section   
    4.02(a)(ii)(A) or Section 4.02(a)(ii)(B), as applicable, but only to the
 extent necessary to maintain the Subordinated Amount at the Specified
  Subordinated Amount, after giving effect to payments and distributions
from Available Funds;                                               

        (vi) to the Class A Certificates, to pay Basis Risk CarryForward
 Amounts, pro rata, based on their Class Certificate Balances for such
  Distribution Date, up to the Swap Payment Allocation for each Class of
Class A Certificates and to the extent unpaid from Available Funds  
(including Basis Risk Payments on deposit in the Excess Reserve Fund
Account);                                                           

         (vii) sequentially, to the Class M-1, Class M-2, Class M-3, Class
M-4, Class M-5, Class M-6, Class B-1, Class B-2 and Class B-3       
Certificates, to pay Basis Risk CarryForward Amounts, up to the Swap
     Payment Allocation for each Class of Class M and Class B Certificates and
    to the extent unpaid from Available Funds (including Basis Risk Payments
on deposit in the Excess Reserve Fund Account);                     

           (viii) to the Offered Certificates, any remaining unpaid Basis Risk
     CarryForward Amount, pro rata, based on their respective remaining unpaid
  Basis Risk CarryForward Amount after the allocation of payments as set
forth in clauses (vi) and (vii) above;                              

        (ix) sequentially, to the Class M-1, Class M-2, Class M-3, Class
M-4, Class M-5, Class M-6, Class B-1, Class B-2 and Class B-3       
      Certificates, to pay any Unpaid Realized Loss Amount, to the extent unpaid
from Available Funds;                                               

          (x) to the Swap Provider, any remaining Defaulted Swap Termination
Payment owed to the Swap Provider for that Distribution Date; and   

      (xi) to the holders of the Class X Certificates, any remaining
amounts.                                                            

        Upon termination of the Trust, any amounts remaining in the Swap
Account shall be distributed pursuant to the priorities set forth in this       
Section 4.06.                                                                   

     In the event that, upon the Trust entering into a replacement
interest rate swap following the occurrence of an Additional Termination Event  
of the type described in Part 1(h)(ii) of the Interest Rate Swap Agreement, the 
Trust is entitled to receive a payment from a replacement swap provider, the    
Trustee shall direct the replacement swap provider to make such payment to the  
Swap Account. Any Senior Defaulted Swap Termination Payment shall be made from  
the Swap Account to the Swap Provider immediately upon receipt of such payment, 
regardless of whether the date of receipt thereof is a Distribution Date. To the
extent that any Replacement Swap Provider Payment is made to an account other   
than the Swap Account, then, notwithstanding anything to the contrary contained 
in this Agreement, any Senior Defaulted Swap Termination Payment shall be paid  
to the Swap Provider immediately upon receipt of such Replacement Swap Provider 
Payment, regardless of whether the date of receipt thereof is a Distribution    
Date and without regard to anything to the contrary contained in this Agreement.
For the avoidance of doubt, the parties agree that the Swap Provider shall have 
first priority to any Replacement Swap Provider Payment over the payment by the 
Trust to Certificateholders, the Servicer, any Responsible Party, the Trustee or
any other Person.                                                               

       The Trustee shall account for the Swap Account as an asset of a
grantor trust under subpart E, Part I of subchapter J of the Code and not as an 
asset of any Trust REMIC created pursuant to this Agreement. The beneficial     
owners of the Swap Account are the Class X Certificateholders. For federal      
income tax purposes, Net Swap Payments and Swap Termination Payments payable to 
the Swap Provider shall be deemed to be paid to the Swap Account from the       
Upper-Tier REMIC, first, by the Holder of the Class X Certificates (in respect  
of the Class IO Interest and, if applicable, the Class X Interest) and second,  
other than any Defaulted Swap Termination Payment, from the Upper-Tier REMIC by 
the Holders of the applicable Class or Classes of Offered Certificates (in      
respect of Class IO Shortfalls) as and to the extent provided in Section 8.13.  

     Any Basis Risk CarryForward Amounts and, without duplication,
Upper-Tier CarryForward Amounts distributed by the Trustee to the Offered       
Certificateholders shall be accounted for by the Trustee, for federal income tax
purposes, as amounts paid first to the Holders of the Class X Certificates in   
respect of the Class X Interest and (to the extent remaining after payments to  
the Swap Provider) the Class IO Interest, and then to the respective Class or   
Classes of Offered Certificates. In addition, the Trustee shall account for the 
rights of Holders of each Class of Offered Certificates to receive payments of  
Upper-Tier CarryForward Amounts (including, but without duplication Basis Risk  
CarryForward Amounts) from the Swap Account (along with Basis Risk CarryForward 
Amounts payable from the Excess Reserve Fund Account) as rights in a separate   
limited recourse interest rate cap contract written by the Class X              
Certificateholders in favor of Holders of each such Class.                      

       The Swap Account shall be an "outside reserve fund" for federal
income tax purposes and not an asset of any Trust REMIC. Furthermore, the       
Holders of the Class X Certificates shall be the beneficial owners of the Swap  
Account for all federal income tax purposes, and shall be taxable on all income 
earned thereon.                                                                 

          With respect to the failure of the Swap Provider to perform any of
its obligations under the Interest Rate Swap Agreement, the breach by the Swap  
Provider of any of its representations and warranties made pursuant to the      
Interest Rate Swap Agreement, or the termination of the Interest Rate Swap      
Agreement, the Trustee shall send any notices and make any demands, on behalf of
the Trust as are required under the Interest Rate Swap Agreement. To the extent 
that the Swap Provider fails to make any payment required under terms of the    
Interest Rate Swap Agreement, the Trustee shall immediately demand that Morgan  
Stanley, the guarantor of the Swap Provider's obligations under the guarantee of
Morgan Stanley relating to the Interest Rate Swap Agreement, make any and all   
payments then required to be made by Morgan Stanley pursuant to such guarantee. 
The Trustee shall cause any replacement swap provider to provide a copy of the  
related replacement interest rate swap agreement to the Trustee and the         
Depositor.                                                                      

 ARTICLE V

THE CERTIFICATES

Section 5.01 The Certificates. The Certificates shall be
substantially in the forms attached hereto as exhibits. The Certificates shall  
be issuable in registered form, in the minimum denominations, integral multiples
in excess thereof (except that one Certificate in each Class may be issued in a 
different amount) and aggregate denominations per Class set forth in the        
Preliminary Statement.                                                          

            The Depositor hereby directs the Trustee to register the Class X and
Class P Certificates in the name of the Depositor or its designee. On a date as 
to which the Depositor notifies the Trustee, the Trustee shall transfer the     
Class X and Class P Certificates in the name of the NIM Trustee, or such other  
name or names as the Depositor shall request, and to deliver the Class X and    
Class P Certificates to the NIM Trustee or to such other Person or Persons as   
the Depositor shall request.                                                    

        Subject to Section 9.02 respecting the final distribution on the
Certificates, on each Distribution Date the Trustee shall make distributions to 
each Certificateholder of record on the preceding Record Date either (x) by wire
transfer in immediately available funds to the account of such Holder at a bank 
or other entity having appropriate facilities therefor, if such Holder has so   
notified the Trustee at least five Business Days prior to the related Record    
Date or (y) by check mailed by first class mail to such Certificateholder at the
address of such Holder appearing in the Certificate Register.                   

           The Certificates shall be executed by manual or facsimile signature
on behalf of the Trustee by an authorized officer. Certificates bearing the     
manual or facsimile signatures of individuals who were, at the time such        
signatures were affixed, authorized to sign on behalf of the Trustee shall bind 
the Trustee, notwithstanding that such individuals or any of them have ceased to
be so authorized prior to the authentication and delivery of any such           
Certificates or did not hold such offices at the date of such Certificate. No   
Certificate shall be entitled to any benefit under this Agreement, or be valid  
for any purpose, unless authenticated by the Trustee by manual signature, and   
such authentication upon any Certificate shall be conclusive evidence, and the  
only evidence, that such Certificate has been duly executed and delivered       
hereunder. All Certificates shall be dated the date of their authentication. On 
the Closing Date, the Trustee shall authenticate the Certificates to be issued  
at the direction of the Depositor, or any Affiliate thereof.                    

       Section 5.02 Certificate Register; Registration of Transfer and
Exchange of Certificates. (a) The Trustee shall maintain, or cause to be        
maintained in accordance with the provisions of Section 5.06, a Certificate     
Register for the Trust Fund in which, subject to the provisions of subsections  
(b) and (c) below and to such reasonable regulations as it may prescribe, the   
Trustee shall provide for the registration of Certificates and of transfers and 
exchanges of Certificates as herein provided. Upon surrender for registration of
transfer of any Certificate, the Trustee shall execute and deliver, in the name 
of the designated transferee or transferees, one or more new Certificates of the
same Class and aggregate Percentage Interest.                                   

           At the option of a Certificateholder, Certificates may be exchanged
for other Certificates of the same Class in authorized denominations and        
evidencing the same aggregate Percentage Interest upon surrender of the         
Certificates to be exchanged at the office or agency of the Trustee. Whenever   
any Certificates are so surrendered for exchange, the Trustee shall execute,    
authenticate, and deliver the Certificates which the Certificateholder making   
the exchange is entitled to receive. Every Certificate presented or surrendered 
for registration of transfer or exchange shall be accompanied by a written      
instrument of transfer in form satisfactory to the Trustee duly executed by the 
Holder thereof or his attorney duly authorized in writing.                      

         No service charge to the Certificateholders shall be made for any
registration of transfer or exchange of Certificates, but payment of a sum      
sufficient to cover any tax or governmental charge that may be imposed in       
connection with any transfer or exchange of Certificates may be required.       

    All Certificates surrendered for registration of transfer or
exchange shall be cancelled and subsequently destroyed by the Trustee in        
accordance with the Trustee's customary procedures.                             

          (b) No transfer of a Private Certificate shall be made unless such
transfer is made pursuant to an effective registration statement under the      
Securities Act and any applicable state securities laws or is exempt from the   
registration requirements under said Act and such state securities laws. In     
determining whether a transfer is being made pursuant to an effective           
registration statement, the Trustee shall be entitled to rely solely upon a     
written notice to such effect from the Depositor. Except with respect to (i) the
transfer of the Class X, Class P or Class R Certificates to the Depositor or an 
Affiliate of the Depositor, (ii) the transfer of the Class X or Class P         
Certificates to the NIM Issuer or the NIM Trustee, or (iii) a transfer of the   
Class X or Class P Certificates from the NIM Issuer or the NIM Trustee to the   
Depositor or an Affiliate of the Depositor, in the event that a transfer of a   
Private Certificate which is a Physical Certificate is to be made in reliance   
upon an exemption from the Securities Act and such laws, in order to assure     
compliance with the Securities Act and such laws, the Certificateholder desiring
to effect such transfer shall certify to the Trustee in writing the facts       
surrounding the transfer in substantially the form set forth in Exhibit H (the  
"Transferor Certificate") and either (i) there shall be delivered to the Trustee
a letter in substantially the form of Exhibit I (the "Rule 144A Letter") or (ii)
there shall be delivered to the Trustee at the expense of the transferor an     
Opinion of Counsel that such transfer may be made without registration under the
Securities Act. In the event that a transfer of a Private Certificate which is a
Book-Entry Certificate is to be made in reliance upon an exemption from the     
Securities Act and such laws, in order to assure compliance with the Securities 
Act and such laws, the Certificateholder desiring to effect such transfer will  
be deemed to have made as of the transfer date each of the certifications set   
forth in the Transferor Certificate in respect of such Certificate and the      
transferee will be deemed to have made as of the transfer date each of the      
certifications set forth in the Rule 144A Letter in respect of such Certificate,
in each case as if such Certificate were evidenced by a Physical Certificate.   
The Depositor shall provide to any Holder of a Private Certificate and any      
prospective transferee designated by any such Holder, information regarding the 
related Certificates and the Mortgage Loans and such other information as shall 
be necessary to satisfy the condition to eligibility set forth in Rule          
144A(d)(4) for transfer of any such Certificate without registration thereof    
under the Securities Act pursuant to the registration exemption provided by Rule
144A. The Trustee and the Servicers shall cooperate with the Depositor in       
providing the Rule 144A information referenced in the preceding sentence,       
including providing to the Depositor such information regarding the             
Certificates, the Mortgage Loans and other matters regarding the Trust Fund as  
the Depositor shall reasonably request to meet its obligation under the         
preceding sentence. Each Holder of a Private Certificate desiring to effect such
transfer shall, and does hereby agree to, indemnify the Trustee, the Depositor  
and each Servicer against any liability that may result if the transfer is not  
so exempt or is not made in accordance with such federal and state laws.        

          Except with respect to (i) the transfer of the Class R, Class X or
Class P Certificates to the Depositor or an Affiliate of the Depositor, (ii) the
transfer of the Class X or Class P Certificates to the NIM Issuer or the NIM    
Trustee, or (iii) a transfer of the Class X or Class P Certificates from the NIM
Issuer or the NIM Trustee to the Depositor or an Affiliate of the Depositor, no 
transfer of an ERISA-Restricted Certificate shall be made unless the Trustee    
shall have received either (i) a representation from the transferee of such     
Certificate acceptable to and in form and substance satisfactory to the Trustee 
(in the event such Certificate is a Private Certificate or a Residual           
Certificate, such requirement is satisfied only by the Trustee's receipt of a   
representation letter from the transferee substantially in the form of Exhibit  
I), to the effect that such transferee is not an employee benefit plan or       
arrangement subject to Section 406 of ERISA, a plan subject to Section 4975 of  
the Code or a plan subject to any Federal, state or local law ("Similar Law")   
materially similar to the foregoing provisions of ERISA or the Code, nor a      
Person acting on behalf of any such plan or arrangement nor using the assets of 
any such plan or arrangement to effect such transfer, or (ii) in the case of an 
ERISA-Restricted Certificate other than a Residual Certificate or a Class P     
Certificate that has been the subject of an ERISA-Qualifying Underwriting, and  
the purchaser is an insurance company, a representation that the purchaser is an
insurance company that is purchasing such Certificates with funds contained in  
an "insurance company general account" (as such term is defined in Section V(e) 
of Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60")) and that the    
purchase and holding of such Certificates are covered under Sections I and III  
of PTCE 95-60 or (iii) in the case of any such ERISA-Restricted Certificate     
other than a Residual Certificate or Class P Certificate presented for          
registration in the name of an employee benefit plan subject to Title I of      
ERISA, a plan or arrangement subject to Section 4975 of the Code (or comparable 
provisions of any subsequent enactments), or a plan subject to Similar Law, or a
trustee of any such plan or any other person acting on behalf of any such plan  
or arrangement or using such plan's or arrangement's assets, an Opinion of      
Counsel satisfactory to the Trustee, which Opinion of Counsel shall not be an   
expense of the Servicers, the Depositor, the Trustee or the Trust Fund,         
addressed to the Trustee, to the effect that the purchase or holding of such    
ERISA-Restricted Certificate will not constitute or result in a non-exempt      
prohibited transaction within the meaning of ERISA, Section 4975 of the Code or 
any Similar Law and will not subject the Depositor, the Trustee or the Servicers
to any obligation in addition to those expressly undertaken in this Agreement or
to any liability. For purposes of the preceding sentence, with respect to an    
ERISA-Restricted Certificate that is not a Private Certificate or a Residual    
Certificate, in the event the representation letter referred to in the preceding
sentence is not furnished, such representation shall be deemed to have been made
to the Trustee by the transferee's (including an initial acquirer's) acceptance 
of the ERISA-Restricted Certificates. Notwithstanding anything else to the      
contrary herein, (a) any purported transfer of an ERISA-Restricted Certificate, 
other than a Class P Certificate or Residual Certificate, to or on behalf of an 
employee benefit plan subject to ERISA, the Code or Similar Law without the     
delivery to the Trustee of an Opinion of Counsel satisfactory to the Trustee as 
described above shall be void and of no effect and (b) any purported transfer of
a Class P Certificate or Residual Certificate to a transferee that does not make
the representation in clause (i) above shall be void and of no effect.          

        To the extent permitted under applicable law (including, but not
limited to, ERISA), the Trustee shall be under no liability to any Person for   
any registration of transfer of any ERISA-Restricted Certificate that is in fact
not permitted by this Section 5.02(b) or for making any payments due on such    
Certificate to the Holder thereof or taking any other action with respect to    
such Holder under the provisions of this Agreement so long as the transfer was  
registered by the Trustee in accordance with the foregoing requirements.        

      As long as the Interest Rate Swap Agreement is in effect, each
beneficial owner of a Certificate other than an ERISA-Restricted Certificate, or
any interest therein, shall be deemed to have represented that either (i) it is 
not a Plan or (ii) the acquisition and holding of the Certificate are eligible  
for the exemptive relief available under at least one of the Investor-Based     
Exemptions.                                                                     

           (c) Each Person who has or who acquires any Ownership Interest in a
Residual Certificate shall be deemed by the acceptance or acquisition of such   
Ownership Interest to have agreed to be bound by the following provisions, and  
the rights of each Person acquiring any Ownership Interest in a Residual        
Certificate are expressly subject to the following provisions:                  

        (i) Each Person holding or acquiring any Ownership Interest in a
   Residual Certificate shall be a Permitted Transferee and shall promptly
   notify the Trustee of any change or impending change in its status as a
Permitted Transferee;                                               

   (ii) No Ownership Interest in a Residual Certificate may be
     registered on the Closing Date or thereafter transferred, and the Trustee
  shall not register the Transfer of any Residual Certificate unless, in
      addition to the certificates required to be delivered to the Trustee under
 subparagraph (b) above, the Trustee shall have been furnished with an
   affidavit (a "Transfer Affidavit") of the initial owner or the proposed
transferee in the form attached hereto as Exhibit G;                

          (iii) Each Person holding or acquiring any Ownership Interest in a
    Residual Certificate shall agree (A) to obtain a Transfer Affidavit from
   any other Person to whom such Person attempts to Transfer its Ownership
  Interest in a Residual Certificate, (B) to obtain a Transfer Affidavit
 from any Person for whom such Person is acting as nominee, trustee or
   agent in connection with any Transfer of a Residual Certificate and (C)
  not to Transfer its Ownership Interest in a Residual Certificate or to
    cause the Transfer of an Ownership Interest in a Residual Certificate to
any other Person if it has actual knowledge that such Person is a   
Non-Permitted Transferee;                                           

          (iv) Any attempted or purported Transfer of any Ownership Interest
    in a Residual Certificate in violation of the provisions of this Section
     5.02(c) shall be absolutely null and void and shall vest no rights in the
      purported Transferee. If any purported transferee shall become a Holder of
 a Residual Certificate in violation of the provisions of this Section
      5.02(c), then the last preceding Permitted Transferee shall be restored to
   all rights as Holder thereof retroactive to the date of registration of
 Transfer of such Residual Certificate. The Trustee shall not have any
  liability to any Person for any registration of Transfer of a Residual
 Certificate that is in fact not permitted by Section 5.02(b) and this
     Section 5.02(c) or for making any payments due on such Certificate to the
 Holder thereof or taking any other action with respect to such Holder
under the provisions of this Agreement so long as the Transfer was  
  registered after receipt of the related Transfer Affidavit, Transferor
   Certificate and the Rule 144A Letter. The Trustee shall be entitled but
   not obligated to recover from any Holder of a Residual Certificate that
     was in fact a Non-Permitted Transferee at the time it became a Holder or,
at such subsequent time as it became a Non-Permitted Transferee, all
     payments made on such Residual Certificate at and after either such time.
     Any such payments so recovered by the Trustee shall be paid and delivered
by the Trustee to the last preceding Permitted Transferee of such   
Certificate; and                                                    

            (v) The Depositor shall use its best efforts to make available, upon
     receipt of written request from the Trustee, all information necessary to
      compute any tax imposed under Section 860E(e) of the Code as a result of a
     Transfer of an Ownership Interest in a Residual Certificate to any Holder
who is a Non-Permitted Transferee.                                  

            The restrictions on Transfers of a Residual Certificate set forth in
this Section 5.02(c) shall cease to apply (and the applicable portions of the   
legend on a Residual Certificate may be deleted) with respect to Transfers      
occurring after delivery to the Trustee of an Opinion of Counsel, which Opinion 
of Counsel shall not be an expense of the Trust Fund or the Trustee, to the     
effect that the elimination of such restrictions will not cause any Trust REMIC 
hereunder to fail to qualify as a REMIC at any time that the Certificates are   
Outstanding or result in the imposition of any tax on the Trust Fund, a         
Certificateholder or another Person. Each Person holding or acquiring any       
Ownership Interest in a Residual Certificate hereby consents to any amendment of
this Agreement which, based on an Opinion of Counsel furnished to the Trustee,  
is reasonably necessary (a) to ensure that the record ownership of, or any      
beneficial interest in, a Residual Certificate is not transferred, directly or  
indirectly, to a Person that is a Non-Permitted Transferee and (b) to provide   
for a means to compel the Transfer of a Residual Certificate which is held by a 
Person that is a Non-Permitted Transferee to a Holder that is a Permitted       
Transferee.                                                                     

         (d) The preparation and delivery of all certificates and opinions
referred to above in this Section 5.02 in connection with transfer shall be at  
the expense of the parties to such transfers.                                   

          (e) Except as provided below, the Book-Entry Certificates shall at
all times remain registered in the name of the Depository or its nominee and at 
all times: (i) registration of the Certificates may not be transferred by the   
Trustee except to another Depository; (ii) the Depository shall maintain        
book-entry records with respect to the Certificate Owners and with respect to   
ownership and transfers of such Book-Entry Certificates; (iii) ownership and    
transfers of registration of the Book-Entry Certificates on the books of the    
Depository shall be governed by applicable rules established by the Depository; 
(iv) the Depository may collect its usual and customary fees, charges and       
expenses from its Depository Participants; (v) the Trustee shall deal with the  
Depository, Depository Participants and indirect participating firms as         
representatives of the Certificate Owners of the Book-Entry Certificates for    
purposes of exercising the rights of holders under this Agreement, and requests 
and directions for and votes of such representatives shall not be deemed to be  
inconsistent if they are made with respect to different Certificate Owners; and 
(vi) the Trustee may rely and shall be fully protected in relying upon          
information furnished by the Depository with respect to its Depository          
Participants and furnished by the Depository Participants with respect to       
indirect participating firms and persons shown on the books of such indirect    
participating firms as direct or indirect Certificate Owners.                   

            All transfers by Certificate Owners of Book-Entry Certificates shall
be made in accordance with the procedures established by the Depository         
Participant or brokerage firm representing such Certificate Owner. Each         
Depository Participant shall only transfer Book-Entry Certificates of           
Certificate Owners it represents or of brokerage firms for which it acts as     
agent in accordance with the Depository's normal procedures.                    

         If (x) (i) the Depository or the Depositor advises the Trustee in
writing that the Depository is no longer willing or able to properly discharge  
its responsibilities as Depository, and (ii) the Trustee or the Depositor is    
unable to locate a qualified successor, or (y) the Depositor notifies the       
Depository (and the Trustee consents) of its intent to terminate the book-entry 
system through the Depository and, upon receipt of notice of such intent from   
the Depository, the Depository Participants holding beneficial interests in the 
Book-Entry Certificates agree to initiate such termination, the Trustee shall   
notify all Certificate Owners, through the Depository, of the occurrence of any 
such event and of the availability of definitive, fully registered Certificates 
(the "Definitive Certificates") to Certificate Owners requesting the same. Upon 
surrender to the Trustee of the related Class of Certificates by the Depository,
accompanied by the instructions from the Depository for registration, the       
Trustee shall issue the Definitive Certificates. None of the Servicers, the     
Depositor or the Trustee shall be liable for any delay in delivery of such      
instruction and each may conclusively rely on, and shall be protected in relying
on, such instructions. The Depositor shall provide the Trustee with an adequate 
inventory of Certificates to facilitate the issuance and transfer of Definitive 
Certificates. Upon the issuance of Definitive Certificates all references herein
to obligations imposed upon or to be performed by the Depository shall be deemed
to be imposed upon and performed by the Trustee, to the extent applicable with  
respect to such Definitive Certificates and the Trustee shall recognize the     
Holders of the Definitive Certificates as Certificateholders hereunder;         
provided, that the Trustee shall not by virtue of its assumption of such        
obligations become liable to any party for any act or failure to act of the     
Depository.                                                                     

 (f) Each Private Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written          
instrument of transfer and accompanied by IRS Form W-8ECI, W-8BEN, W-8IMY (and  
all appropriate attachments) or W-9 in form satisfactory to the Trustee, duly   
executed by the Certificateholder or his attorney duly authorized in writing.   
Each Certificate presented or surrendered for registration of transfer or       
exchange shall be canceled and subsequently disposed of by the Trustee in       
accordance with its customary practice. No service charge shall be made for any 
registration of transfer or exchange of Private Certificates, but the Trustee   
may require payment of a sum sufficient to cover any tax or governmental charge 
that may be imposed in connection with any transfer or exchange of Private      
Certificates.                                                                   

          Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates. If
(a) any mutilated Certificate is surrendered to the Trustee, or the Trustee     
receives evidence to its satisfaction of the destruction, loss or theft of any  
Certificate and (b) there is delivered to the Depositor, the Servicers and the  
Trustee such security or indemnity as may be required by them to hold each of   
them harmless, then, in the absence of notice to the Trustee that such          
Certificate has been acquired by a bona fide purchaser, the Trustee shall       
execute, authenticate and deliver, in exchange for or in lieu of any such       
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like     
Class, tenor and Percentage Interest. In connection with the issuance of any new
Certificate under this Section 5.03, the Trustee may require the payment of a   
sum sufficient to cover any tax or other governmental charge that may be imposed
in relation thereto and any other expenses (including the fees and expenses of  
the Trustee) connected therewith. Any replacement Certificate issued pursuant to
this Section 5.03 shall constitute complete and indefeasible evidence of        
ownership, as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.                                         

           Section 5.04 Persons Deemed Owners. The Servicers, the Trustee, the
Depositor and any agent of a Servicer, the Depositor or the Trustee may treat   
the Person in whose name any Certificate is registered as the owner of such     
Certificate for the purpose of receiving distributions as provided in this      
Agreement and for all other purposes whatsoever, and none of the Servicers, the 
Trustee, the Depositor, or any agent of a Servicer, the Depositor or the Trustee
shall be affected by any notice to the contrary.                                

    Section 5.05 Access to List of Certificateholders' Names and
Addresses. If three or more Certificateholders (a) request such information in  
writing from the Trustee, (b) state that such Certificateholders desire to      
communicate with other Certificateholders with respect to their rights under    
this Agreement or under the Certificates and (c) provide a copy of the          
communication which such Certificateholders propose to transmit, or if the      
Depositor or Servicer shall request such information in writing from the        
Trustee, then the Trustee shall, within ten Business Days after the receipt of  
such request, provide the Depositor, such Servicer or the Certificateholders at 
such recipients' expense the most recent list of the Certificateholders of such 
Trust Fund held by the Trustee, if any. The Depositor and every                 
Certificateholder, by receiving and holding a Certificate, agree that the       
Trustee shall not be held accountable by reason of the disclosure of any such   
information as to the list of the Certificateholders hereunder, regardless of   
the source from which such information was derived.                             

      Section 5.06 Maintenance of Office or Agency. The Trustee will
maintain or cause to be maintained at its expense an office or offices or agency
or agencies in the United States where Certificates may be surrendered for      
registration of transfer or exchange. The Trustee initially designates the      
offices of its agent located at DB Services Tennessee, 648 Grassmere Park Road, 
Nashville, Tennessee 37211-3658, Attention: Transfer Unit for such purposes. The
Trustee shall give prompt written notice to the Certificateholders of any change
in such location of any such office or agency.                                  

ARTICLE VI

 THE DEPOSITOR AND THE SERVICERS

    Section 6.01 Respective Liabilities of the Depositor and the
Servicers. The Depositor and each of the Servicers shall each be liable in      
accordance herewith only to the extent of the obligations specifically and      
respectively imposed upon and undertaken by them herein.                        

            Section 6.02 Merger or Consolidation of the Depositor or a Servicer.
(a) The Depositor and each of the Servicers will each keep in full effect its   
existence, rights and franchises as a corporation or federally chartered savings
bank, as the case may be, under the laws of the United States or under the laws 
of one of the states thereof and will each 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 respective duties under this Agreement.                                     

           (b) Any Person into which the Depositor or a Servicer may be merged
or consolidated, or any Person resulting from any merger or consolidation to    
which the Depositor or a Servicer shall be a party, or any person succeeding to 
the business of the Depositor or a Servicer, shall be the successor of the      
Depositor or such Servicer, as the case may be, hereunder, without the execution
or filing of any paper or any further act on the part of any of the parties     
hereto, anything herein to the contrary notwithstanding; provided, however, that
the successor or surviving Person to such Servicer shall be qualified to service
mortgage loans on behalf of, Fannie Mae or Freddie Mac. As a condition to the   
succession to any Servicer under this Agreement by any Person (i) into which a  
Servicer may be merged or consolidated, or (ii) which may be appointed as a     
successor to a Servicer, such Servicer shall provide to the Depositor, at least 
15 calendar days prior to the effective date of such succession or appointment, 
(x) written notice to the Depositor of such succession or appointment and (y) in
writing and in form and substance reasonably satisfactory to the Depositor, all 
information reasonably necessary to enable the Trustee, pursuant to Section     
8.12(g), to accurately and timely report the event under Item 6.02 of Form 8-K  
pursuant to the Exchange Act (if such reports under the Exchange Act are then   
required to be filed under the Exchange Act).                                   

            Section 6.03 Limitation on Liability of the Depositor, the Servicers
and Others. Neither the Depositor, the Servicers nor any of their respective    
directors, officers, employees or agents shall be under any liability to the    
Certificateholders 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 Depositor, the     
Servicers or any such Person against any breach of representations or warranties
made by it herein or protect the Depositor, the Servicers or any such Person    
from any liability which would otherwise be imposed by reasons of willful       
misfeasance, bad faith or negligence (or gross negligence in the case of the    
Depositor) in the performance of duties or by reason of reckless disregard of   
obligations and duties hereunder. The Depositor, each Servicer and any director,
officer, employee or agent of the Depositor and each Servicer 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 Depositor and its      
Affiliates, the Sponsor, each Servicer and any director, officer, employee or   
agent of the Depositor, the Sponsor or each Servicer shall be indemnified by the
Trust Fund and held harmless against any loss, liability or expense incurred in 
connection with any audit, controversy or judicial proceeding relating to a     
governmental taxing authority or any legal action relating to this Agreement or 
the Certificates other than any loss, liability or expense related to any       
specific Mortgage Loan or Mortgage Loans (except as any such loss, liability or 
expense shall be otherwise reimbursable pursuant to this Agreement) and any     
loss, liability or expense incurred by reason of willful misfeasance, bad faith 
or negligence (or gross negligence in the case of the Depositor) in the         
performance of duties hereunder or by reason of reckless disregard of           
obligations and duties hereunder. Neither the Depositor nor any Servicer shall  
be under any obligation to appear in, prosecute or defend any legal action that 
is not incidental to its respective duties hereunder and which in its opinion   
may involve it in any expense or liability; provided, however, that each of the 
Depositor and each Servicer may in its discretion undertake any such action (or 
direct the Trustee to undertake such actions pursuant to Section 2.03 for the   
benefit of the Certificateholders) that it may deem necessary or desirable in   
respect of this Agreement and the rights and duties of the parties hereto and   
interests of the Trustee and the Certificateholders hereunder. In such event,   
the legal expenses and costs of such action and any liability resulting         
therefrom shall be expenses, costs and liabilities of the Trust Fund, and the   
Depositor and the applicable Servicer shall be entitled to be reimbursed        
therefor out of the applicable Collection Account.                              

        Section 6.04 Limitation on Resignation of a Servicer. Subject to
Sections 7.01 and 10.07, no Servicer shall assign this Agreement or resign from 
the obligations and duties hereby imposed on it except by mutual consent of the 
Servicers, the Depositor and the Trustee or upon the determination that its     
duties hereunder are no longer permissible under applicable law and such        
incapacity cannot be cured by such Servicer. Any such determination permitting  
the resignation of a Servicer shall be evidenced by an Opinion of Counsel to    
such effect delivered to the Depositor and the Trustee which Opinion of Counsel 
shall be in form and substance acceptable to the Depositor and the Trustee. No  
such resignation shall become effective until a successor shall have assumed    
such Servicer's responsibilities and obligations hereunder.                     

    Notwithstanding the provisions of Section 6.04 herein to the
contrary, in the event that a Servicer determines that it will no longer engage 
in the business of servicing mortgage loans, such Servicer may assign its rights
under this Agreement, provided that, (i) the Depositor in its sole discretion   
has consented, which consent shall not be unreasonably withheld, (ii) the Rating
Agencies' ratings of the Certificates in effect immediately prior to such action
will not be qualified, reduced or withdrawn as a result thereof (as evidenced by
a letter to such effect from the Rating Agencies) and (iii) such Servicer shall 
be liable for all costs and expenses associated with the transfer of servicing, 
provided, further, that such Servicer shall indemnify and hold each of the Trust
Fund, the Trustee, the Depositor, the other Servicers hereunder, any            
sub-servicer, the successor servicer and each Certificateholder harmless against
any and all claims, losses, penalties, fines, forfeitures, reasonable legal fees
and related costs, judgments, and any other costs, fees and expenses that such  
party may sustain in any way related to such assignment except with respect to a
successor servicer's failure to comply with the terms of this Agreement. No     
assignment by such Servicer shall become effective until a successor Servicer   
acceptable to the Depositor and the Trustee shall have assumed in writing such  
Servicer's responsibilities, duties, liabilities (other than those liabilities  
arising prior to the appointment of such successor) and obligations under this  
Agreement. Any such assignment shall not relieve the applicable Servicer of     
responsibility for any of the obligations specified herein except to the extent 
that such responsibilities have been expressly assumed by the successor         
servicer.                                                                       

       Section 6.05 Additional Indemnification by the Servicers; Third
Party Claims. (a) Each Servicer, severally and not jointly, shall indemnify the 
Responsible Party, the Depositor, the Sponsor and the Trustee and any director, 
officer, employee or agent of the Depositor, the Sponsor or the Trustee and hold
them harmless against any and all claims, losses, damages, penalties, fines,    
forfeitures, reasonable and necessary legal fees and related costs, judgments,  
and any other costs, fees and expenses that any of them may sustain in any way  
related to (i) any breach by such Servicer of any of its representations and    
warranties referred to in Section 2.03(a), (ii) any error in any tax or         
information return prepared by such Servicer or (iii) the failure of such       
Servicer to perform its duties and service the Mortgage Loans in compliance with
the terms of this Agreement (including, without limitation, the failure to      
deliver accurate and complete information on a timely basis pursuant to Section 
4.03(d)). The applicable Servicer immediately shall notify the Depositor and the
Trustee if such claim is made by a third party with respect to this Agreement or
the Mortgage Loans, assume (with the prior written consent of the Depositor and 
the Trustee) 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 Depositor,
the Responsible Party or the Trustee in respect of such claim.                  

      (b) Notwithstanding anything to the contrary contained in this
Agreement, each Servicer shall indemnify the Depositor, the Sponsor, the Trustee
and any director, officer, employee or agent of the Depositor, the Sponsor or   
the Trustee and hold them harmless against any and all claims, losses, damages, 
penalties, fines, forfeitures, reasonable and necessary legal fees and related  
costs, judgments, and any other costs, fees and expenses that any of them may   
sustain in any way related to any failure by such Servicer or any Subservicer   
engaged by such Servicer or any Subcontractor utilized by such Servicer to      
deliver any information, report, certification or accountants' letter when and  
as required under Sections 3.22, 3.23, 6.02 or 8.12, including without          
limitation any failure by such Servicer to identify pursuant to Section 3.02(e) 
any Subcontractor "participating in the servicing function" within the meaning  
of Item 1122 of Regulation AB.                                                  

       (c) If the indemnification provided for in this Section 6.05 is
unavailable or insufficient to hold harmless any Person entitled to             
indemnification thereunder, then such Servicer shall contribute to the amount   
paid or payable by the Person entitled to indemnification as a result of the    
losses, claims, damages or liabilities of such Person in such proportion as is  
appropriate to reflect the relative fault of such Person on the one hand and    
such Servicer, on the other, in connection with the Servicer's obligations      
pursuant to this Section 6.05. This Section 6.05 shall survive the termination  
of this Agreement or the earlier resignation or removal of each Servicer.       

 ARTICLE VII

 DEFAULT

        Section 7.01 Events of Default. "Event of Default" wherever used
herein, means, with respect to each Servicer individually, any one of the       
following events:                                                               

         (a) any failure by a Servicer to remit to the Trustee any payment
required to be made under the terms of this Agreement which continues unremedied
for a period of one Business Day after the date upon which written notice of    
such failure, requiring the same to be remedied, shall have been given to such  
Servicer by the Depositor or by the Trustee, or to such Servicer, the Depositor 
and the Trustee by Certificateholders entitled to at least 25% of the Voting    
Rights in the Certificates; or                                                  

            (b) any failure on the part of a Servicer duly to observe or perform
in any material respect any other of the covenants or agreements on the part of 
such Servicer set forth in this Agreement which continues unremedied for a      
period of sixty (60) days (except that (x) such number of days shall be fifteen 
in the case of a failure to pay any premium for any insurance policy required to
be maintained under this Agreement and (y) such number of days shall be ten in  
the case of a failure to observe or perform any of the obligations set forth in 
Sections 3.02, 3.22, 3.23, 6.02 or 8.12), after the earlier of (i) the date on  
which written notice of such failure, requiring the same to be remedied, shall  
have been given to such Servicer by the Depositor or by the Trustee, or to such 
Servicer, the Depositor and the Trustee by Certificateholders entitled to at    
least 25% of the Voting Rights in the Certificates and (ii) actual knowledge of 
such failure by a Servicing Officer of such Servicer; or                        

           (c) 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, bankruptcy, readjustment of debt, marshalling of  
assets and liabilities or similar proceedings, or for the winding-up or         
liquidation of its affairs, shall have been entered against a Servicer and such 
decree or order shall have remained in force undischarged or unstayed for a     
period of sixty days; or                                                        

           (d) a Servicer shall consent to the appointment of a conservator or
receiver or liquidator in any insolvency, bankruptcy, readjustment of debt,     
marshalling of assets and liabilities or similar proceedings of or relating to a
Servicer or of or relating to all or substantially all of its property; or      

            (e) a Servicer 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 or reorganization statute, make an assignment for the     
benefit of its creditors, or voluntarily suspend payment of its obligations; or 

     (f) a breach of any representation and warranty of a Servicer
referred to in Section 2.03(a), which materially and adversely affects the      
interests of the Certificateholders and which continues unremedied for a period 
of thirty days after the date upon which written notice of such breach is given 
to such Servicer by the Trustee or by the Depositor, or to such Servicer, the   
Trustee and the Depositor by Certificateholders entitled to at least 25% of the 
Voting Rights in the Certificates; or                                           

           (g) either (i) with respect to HomEq or JPMorgan, any withdrawal or
downgrade of two or more levels (i.e., from "Above Average" to "Below Average"  
or the equivalent) of the servicer rating, as of the Closing Date, of such      
Servicer by any Rating Agency which results in a downgrade, qualification or    
withdrawal of the rating assigned to any Class of Certificates by any Rating    
Agency or (ii) with respect to HomEq, Fitch reduces its servicer rating of HomEq
to "RPS2-" or lower, Moody's reduces its servicer rating of HomEq to "SQ3" or   
lower, or S&P reduces its servicer rating of HomEq to "Average" or lower.       

           If an Event of Default described in clauses (a) through (g) of this
Section 7.01 shall occur, then, and in each and every such case, so long as such
Event of Default shall not have been remedied, the Trustee may, and at the      
written direction of a majority of the Voting Rights, the Trustee shall, by     
notice in writing to the applicable Servicer (with a copy to each Rating        
Agency), terminate all of the rights and obligations of such Servicer under this
Agreement and in and to the Mortgage Loans serviced by such Servicer and the    
proceeds thereof, other than its rights as a Certificateholder hereunder;       
provided, however, that the Trustee shall not be required to give written notice
to such Servicer of the occurrence of an Event of Default described in clauses  
(b) through (g) of this Section 7.01 unless and until a Responsible Officer of  
the Trustee has actual knowledge of the occurrence of such an event. In the     
event that a Responsible Officer of the Trustee has actual knowledge of the     
occurrence of an event of default described in clause (a) of this Section 7.01, 
the Trustee shall give written notice to the applicable Servicer of the         
occurrence of such an event within one Business Day of the first day on which   
such Responsible Officer obtains actual knowledge of such occurrence; provided, 
that if such failure is the failure to make a P&I Advance, the Trustee shall    
send such notice prior to 12:00 noon, New York time, on the Distribution Date   
and, if the Event of Default of such Servicer was the failure to make a P&I     
Advance, the Trustee, as successor servicer, shall make such P&I Advance on the 
Distribution Date that such notice was delivered. On and after the receipt by   
such Servicer of such written notice, all authority and power of such Servicer  
hereunder, whether with respect to the Mortgage Loans or otherwise, shall pass  
to and be vested in the Trustee. Subject to Section 7.02, the Trustee is hereby 
authorized and empowered to execute and deliver, on behalf of such Servicer, as 
attorney-in-fact or otherwise, any and all documents and other instruments, and 
to do or accomplish all other acts or things necessary or appropriate to effect 
the purposes of such notice of termination, whether to complete the transfer and
endorsement or assignment of the Mortgage Loans and related documents, or       
otherwise. Unless expressly provided in such written notice, no such termination
shall affect any obligation of such Servicer to pay amounts owed pursuant to    
Article VIII. Such Servicer agrees to cooperate with the Trustee in effecting   
the termination of such Servicer's responsibilities and rights hereunder,       
including, without limitation, the transfer to the Trustee of all cash amounts  
which shall at the time be credited to the Collection Account of such           
predecessor servicer, or thereafter be received with respect to the Mortgage    
Loans.                                                                          

       Notwithstanding any termination of the activities of a Servicer
hereunder, such Servicer shall be entitled to receive from the Trust Fund, prior
to transfer of its servicing obligations hereunder, payment of all accrued and  
unpaid Servicing Fees and reimbursement for all outstanding P&I Advances and    
Servicing Advances.                                                             

           Section 7.02 Trustee to Act; Appointment of Successor. On and after
the time a Servicer receives a notice of termination pursuant to Section 3.24 or
Section 7.01, the Trustee shall, subject to and to the extent provided in       
Section 3.05, be the successor to such servicer in its capacity as servicer     
under this Agreement and the transactions set forth or provided for herein and  
shall be subject to all the responsibilities, duties and liabilities relating   
thereto placed on such Servicer by the terms and provisions hereof and          
applicable law including the obligation to make P&I Advances or Servicing       
Advances pursuant to Section 3.24 or Section 7.01. As compensation therefor, the
Trustee shall be entitled to all funds relating to the Mortgage Loans that such 
Servicer would have been entitled to charge to its Collection Account if such   
Servicer had continued to act hereunder including, if such Servicer was         
receiving the Servicing Fee, the Servicing Fee and the income on investments or 
gain related to its Collection Account and the Distribution Account which such  
Servicer would be entitled to receive (in addition to income on investments or  
gain related to the Distribution Account for the benefit of the Trustee during  
the Trustee Float Period). Notwithstanding the foregoing, if the Trustee has    
become the successor to such servicer in accordance with Section 7.01, the      
Trustee may, if it shall be unwilling to so act, or shall, if it is prohibited  
by applicable law from making P&I Advances and Servicing Advances pursuant to   
Section 4.01, if it is otherwise unable to so act or at the written request of  
Certificateholders entitled to at least a majority of the Voting Rights,        
appoint, or petition a court of competent jurisdiction to appoint, any          
established mortgage loan servicing institution the appointment of which does   
not adversely affect the then current rating of the Certificates by each Rating 
Agency, as the successor to such servicer hereunder in the assumption of all or 
any part of the responsibilities, duties or liabilities of such servicer        
hereunder. Any successor to such servicer shall be an institution which is a    
Fannie Mae and Freddie Mac approved servicer in good standing, which has a net  
worth of at least $30,000,000, which is willing to service the Mortgage Loans   
and which executes and delivers to the Depositor and the Trustee an agreement   
accepting such delegation and assignment, containing an assumption by such      
Person of the rights, powers, duties, responsibilities, obligations and         
liabilities of such terminated servicer (other than liabilities of such         
terminated servicer under Section 6.03 incurred prior to termination of such    
servicer under Section 7.01), with like effect as if originally named as a party
to this Agreement; provided, that each Rating Agency acknowledges that its      
rating of the Certificates in effect immediately prior to such assignment and   
delegation will not be qualified or reduced, as a result of such assignment and 
delegation. Pending appointment of a successor to a servicer hereunder, the     
Trustee, unless the Trustee is prohibited by law from so acting, shall, subject 
to Section 3.05, act in such capacity as hereinabove provided. In connection    
with such appointment and assumption, the Trustee may make such arrangements for
the compensation of such successor out of payments on Mortgage Loans as it and  
such successor shall agree; provided, however, that no such compensation shall  
be in excess of the Servicing Fee Rate and amounts paid to the predecessor      
servicer from investments. The Trustee and such successor shall take such       
action, consistent with this Agreement, as shall be necessary to effectuate any 
such succession. Neither the Trustee nor any other successor servicer shall be  
deemed to be in default hereunder by reason of any failure to make, or any delay
in making, any distribution hereunder or any portion thereof or any failure to  
perform, or any delay in performing, any duties or responsibilities hereunder,  
in either case caused by the failure of the predecessor servicer to deliver or  
provide, or any delay in delivering or providing, any cash, information,        
documents or records to it.                                                     

            In the event that a Servicer is terminated pursuant to Section 7.01,
such terminated Servicer shall be responsible for the servicing transfer,       
provide notices to the Mortgagors, arrange for and transfer the Servicing Files 
to a successor Servicer, pay all of its own out-of-pocket costs and expenses at 
its own expense and pay all costs and expenses of all other parties hereto      
relating to the transfer of the related Servicing Files to a successor Servicer 
(excluding set-up costs and other administrative expenses of the successor      
Servicer), and in all other cases the successor Servicer shall pay for such     
costs and expenses but shall not be entitled to reimbursement therefor from the 
Trust Fund. Such amounts payable by the terminated Servicer shall be paid by the
terminated Servicer promptly upon presentation of reasonable documentation of   
such costs. If the Trustee is the predecessor Servicer (except in the case where
the Trustee in its role as successor Servicer is being terminated pursuant to   
Section 7.01 by reason of an Event of Default caused solely by the Trustee as   
the successor Servicer and not by the predecessor Servicer's actions or         
omissions), such costs shall be paid by the prior terminated Servicer promptly  
upon presentation of reasonable documentation of such costs.                    

        Any successor to a Servicer as servicer shall give notice to the
Mortgagors of such change of servicer and shall, during the term of its service 
as servicer, maintain in force the policy or policies that each Servicer is     
required to maintain pursuant to Section 3.13.                                  

     Section 7.03 Notification to Certificateholders. (a) Upon any
termination of or appointment of a successor to a Servicer, the Trustee shall   
give prompt written notice thereof to Certificateholders and to each Rating     
Agency.                                                                         

            (b) Within 60 days after the occurrence of any Event of Default, the
Trustee shall transmit by mail to all Certificateholders and each Rating Agency 
notice of each such Event of Default hereunder known to the Trustee, unless such
event shall have been cured or waived.                                          

ARTICLE VIII

CONCERNING THE TRUSTEE

   Section 8.01 Duties of the Trustee. The Trustee, before the
occurrence of an Event of Default and after the curing of all Events of Default 
that may have occurred, shall undertake to perform such duties and only such    
duties as are specifically set forth in this Agreement. In case an Event of     
Default has occurred and remains uncured, the Trustee shall exercise such of the
rights and powers vested in it by this Agreement, and use the same degree of    
care and skill in their exercise as a prudent person would exercise or use under
the circumstances in the conduct of such person's own affairs.                  

   The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished 
to the Trustee that are specifically required to be furnished pursuant to any   
provision of this Agreement shall examine them to determine whether they are in 
the form required by this Agreement. The Trustee shall not be responsible for   
the accuracy or content of any resolution, certificate, statement, opinion,     
report, document, order, or other instrument.                                   

        No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure  
to act or its own willful misconduct.                                           

           Unless an Event of Default known to the Trustee has occurred and is
continuing:                                                                     

         (a) the duties and obligations of the Trustee shall be determined
solely by the express provisions of this Agreement, the Trustee shall not be    
liable except for the performance of the duties and obligations specifically set
forth in this Agreement, no implied covenants or obligations shall be read into 
this Agreement against the Trustee, and the Trustee may conclusively rely, as to
the truth of the statements and the correctness of the opinions expressed       
therein, upon any certificates or opinions furnished to the Trustee and         
conforming on their face to the requirements of this Agreement which it believed
in good faith to be genuine and to have been duly executed by the proper        
authorities respecting any matters arising hereunder;                           

            (b) the Trustee shall not be liable for an error of judgment made in
good faith by a Responsible Officer or Responsible Officers of the Trustee,     
unless it is finally proven that the Trustee was negligent in ascertaining the  
pertinent facts; and                                                            

      (c) the Trustee shall not be liable with respect to any action
taken, suffered, or omitted to be taken by it in good faith in accordance with  
the direction of the Holders of Certificates evidencing not less than 25% of the
Voting Rights of Certificates relating to the time, method, and place of        
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee under this Agreement.             

 (d) The Trustee shall be permitted to utilize one or more
Subcontractors for the performance of certain of its obligations under this     
Agreement, provided that the Trustee complies with Section 3.02(e) as if the    
Trustee were a "Servicer" pursuant to that Section. The Trustee shall indemnify 
the Depositor, the Sponsor and any director, officer, employee or agent of the  
Depositor or the Sponsor and hold them harmless against any and all claims,     
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal  
fees and related costs, judgments, and any other costs, fees and expenses that  
any of them may sustain in any way related to the failure of the Trustee to     
perform any of its obligations under Section 3.22 or Section 3.23, including    
without limitation any failure by the Trustee to identify pursuant to Section   
3.02(e) any Subcontractor that is a Servicing Function Participant. This        
indemnity shall survive the termination of this Agreement or the earlier        
resignation or removal of the Trustee.                                          

     Section 8.02 Certain Matters Affecting the Trustee. Except as
otherwise provided in Section 8.01:                                             

           (a) the Trustee may request and rely upon and shall be protected in
acting or refraining from acting upon any resolution, Officer's Certificate,    
certificate of auditors or any other certificate, statement, instrument,        
opinion, report, notice, request, consent, order, appraisal, bond or other paper
or document believed by it to be genuine and to have been signed or presented by
the proper party or parties and the Trustee shall have no responsibility to     
ascertain or confirm the genuineness of any signature of any such party or      
parties;                                                                        

       (b) the Trustee may consult with counsel, financial advisers or
accountants and the advice of any such counsel, financial advisers or           
accountants and any Opinion of Counsel shall be full and complete authorization 
and protection in respect of any action taken or suffered or omitted by it      
hereunder in good faith and in accordance with such Opinion of Counsel;         

          (c) the Trustee shall not be liable for any action taken, suffered
or omitted by it in good faith and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Agreement;             

         (d) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,          
instrument, opinion, report, notice, request, consent, order, approval, bond or 
other paper or document, unless requested in writing to do so by the Holders of 
Certificates evidencing not less than 25% of the Voting Rights allocated to each
Class of Certificates;                                                          

            (e) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents,           
accountants or attorneys and the Trustee shall not be responsible for any       
misconduct or negligence on the part of any agents, accountants or attorneys    
appointed with due care by it hereunder;                                        

       (f) the Trustee shall not be required to risk or expend its own
funds or otherwise incur any financial liability in the performance of any of   
its duties or in the exercise of any of its rights or powers hereunder if it    
shall have reasonable grounds for believing that repayment of such funds or     
adequate indemnity against such risk or liability is not assured to it;         

          (g) the Trustee shall not be liable for any loss on any investment
of funds pursuant to this Agreement (other than as issuer of the investment     
security and with respect to the investment of funds in the Distribution Account
during the Trustee Float Period);                                               

            (h) unless a Responsible Officer of the Trustee has actual knowledge
of the occurrence of an Event of Default, the Trustee shall not be deemed to    
have knowledge of an Event of Default, until a Responsible Officer of the       
Trustee shall have received written notice thereof; and                         

           (i) the Trustee shall be under no obligation to exercise any of the
trusts, rights or powers vested in it by this Agreement or to institute, conduct
or defend any litigation hereunder or in relation hereto at the request, order  
or direction of any of the Certificateholders, pursuant to this Agreement,      
unless such Certificateholders shall have offered to the Trustee reasonable     
security or indemnity satisfactory to the Trustee against the costs, expenses   
and liabilities which may be incurred therein or thereby.                       

           Section 8.03 Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates shall be taken as the     
statements of the Depositor and the Trustee assumes no responsibility for their 
correctness. The Trustee makes no representations as to the validity or         
sufficiency of this Agreement, the Interest Rate Swap Agreement or of the       
Certificates or of any Mortgage Loan or related document other than with respect
to the Trustee's execution and authentication of the Certificates. The Trustee  
shall not be accountable for the use or application by the Depositor or a       
Servicer of any funds paid to the Depositor or a Servicer in respect of the     
Mortgage Loans or deposited in or withdrawn from any Collection Account or the  
Distribution Account by the Depositor or a Servicer.                            

            The Trustee shall have no responsibility for filing or recording any
financing or continuation statement in any public office at any time or to      
otherwise perfect or maintain the perfection of any security interest or lien   
granted to it hereunder (unless the Trustee shall have become the successor     
Servicer).                                                                      

     The Trustee executes the Interest Rate Swap Agreement and the
Certificates not in its individual capacity but solely as Trustee of the Trust  
Fund created by this Agreement, in the exercise of the powers and authority     
conferred and vested in it by this Agreement. Each of the undertakings and      
agreements made on the part of the Trustee on behalf of the Trust Fund in the   
Interest Rate Swap Agreement and the Certificates is made and intended not as a 
personal undertaking or agreement by the Trustee but is made and intended for   
the purpose of binding only the Trust Fund.                                     

     Section 8.04 Trustee May Own Certificates. The Trustee in its
individual or any other capacity may become the owner or pledgee of Certificates
with the same rights as it would have if it were not the Trustee.               

         Section 8.05 Trustee's Fees and Expenses. As compensation for its
activities under this Agreement, the Trustee may withdraw from the Distribution 
Account on each Distribution Date the Trustee Fee for the Distribution Date and 
any interest or investment income earned on funds deposited in the Distribution 
Account during the Trustee Float Period. The Trustee and any director, officer, 
employee, or agent of the Trustee shall be indemnified by the Trust Fund against
any loss, liability, or expense (including reasonable attorney's fees) resulting
from any error in any tax or information return prepared by any Servicer or     
incurred in connection with any claim or legal action relating to (a) this      
Agreement, (b) the Certificates or the Interest Rate Swap Agreement, or (c) the 
performance of any of the Trustee's duties under this Agreement, the            
Certificates or the Interest Rate Swap Agreement, other than any loss,          
liability, or expense (i) resulting from any breach of any Servicer's           
obligations in connection with this Agreement for which the related Servicer has
performed its obligation to indemnify the Trustee pursuant to Section 6.05, (ii)
resulting from any breach of any Responsible Party's obligations in connection  
with this Agreement for which the related Responsible Party has performed its   
obligations to indemnify the Trustee pursuant to Section 2.03(j) or (iii)       
incurred because of willful misconduct, bad faith, or negligence in the         
performance of any of the Trustee's duties under this Agreement. This indemnity 
shall survive the termination of this Agreement or the resignation or removal of
the Trustee under this Agreement. Without limiting the foregoing, except as     
otherwise agreed upon in writing by the Depositor and the Trustee, and except   
for any expense, disbursement, or advance arising from the Trustee's negligence,
bad faith, or willful misconduct, the Trust Fund shall pay or reimburse the     
Trustee, for all reasonable expenses, disbursements, and advances incurred or   
made by the Trustee in accordance with this Agreement with respect to:          

                (A) the reasonable compensation, expenses, and disbursements
         of its counsel not associated with the closing of the issuance of
the Certificates, and                                   

                (B) the reasonable compensation, expenses, and disbursements
       of any accountant, engineer, or appraiser that is not regularly
           employed by the Trustee, to the extent that the Trustee must engage
them to perform services under this Agreement.          

           Except as otherwise provided in this Agreement or a separate letter
agreement between the Trustee and the Depositor, the Trustee shall not be       
entitled to payment or reimbursement for any routine ongoing expenses incurred  
by the Trustee in the ordinary course of its duties as Trustee under this       
Agreement or for any other expenses incurred by the Trustee; provided, however, 
that no expense shall be reimbursed by the Trust Fund under this Agreement if it
would not constitute an "unanticipated expense incurred by the REMIC" within the
meaning of the REMIC Provisions.                                                

          Section 8.06 Eligibility Requirements for the Trustee. The Trustee
hereunder shall at all times be a corporation or association organized and doing
business under the laws of a state or the United States of America, authorized  
under such laws to exercise corporate trust powers, having a combined capital   
and surplus of at least $50,000,000, subject to supervision or examination by   
federal or state authority and with a credit rating which would not cause any of
the Rating Agencies to reduce their respective then current ratings of the      
Certificates (or having provided such security from time to time as is          
sufficient to avoid such reduction) as evidenced in writing by each Rating      
Agency. If such corporation or association publishes reports of condition at    
least annually, pursuant to law or to the requirements of the aforesaid         
supervising or examining authority, then for the purposes of this Section 8.06  
the combined capital and surplus of such corporation or association shall be    
deemed to be its combined capital and surplus as set forth in its most recent   
report of condition so published. In case at any time the Trustee shall cease to
be eligible in accordance with this Section 8.06, the Trustee shall resign      
immediately in the manner and with the effect specified in Section 8.07. The    
entity serving as Trustee may have normal banking and trust relationships with  
the Depositor or the Servicers and their respective Affiliates; provided,       
however, that such entity cannot be an Affiliate of the Depositor or a Servicer 
other than the Trustee in its role as successor to a Servicer.                  

            Section 8.07 Resignation and Removal of the Trustee. The Trustee may
at any time resign and be discharged from the trusts hereby created by giving   
written notice of resignation to the Depositor, the Servicers and each Rating   
Agency not less than 60 days before the date specified in such notice, when,    
subject to Section 8.08, such resignation is to take effect, and acceptance by a
successor trustee in accordance with Section 8.08 meeting the qualifications set
forth in Section 8.06. If no successor trustee meeting such qualifications shall
have been so appointed and have accepted appointment within 30 days after the   
giving of such notice or resignation, the resigning Trustee may petition any    
court of competent jurisdiction for the appointment of a successor trustee.     

           If at any time the Trustee shall cease to be eligible in accordance
with Section 8.06 and shall fail to resign after written request thereto by the 
Depositor, or if at any time the Trustee shall become incapable of acting, or   
shall be adjudged as bankrupt or insolvent, or a receiver of the Trustee or of  
its property shall be appointed, or any public officer shall take charge or     
control of the Trustee or of its property or affairs for the purpose of         
rehabilitation, conservation or liquidation, or a tax is imposed with respect to
the Trust Fund by any state in which the Trustee or the Trust Fund is located   
and the imposition of such tax would be avoided by the appointment of a         
different trustee, then the Depositor may remove the Trustee and appoint a      
successor trustee by written instrument, in triplicate, one copy of which shall 
be delivered to the Trustee, one copy to each Servicer and one copy to the      
successor trustee.                                                              

          The Holders of Certificates entitled to at least a majority of the
Voting Rights may at any time remove the Trustee and appoint a successor trustee
by written instrument or instruments, in triplicate, signed by such Holders or  
their attorneys-in-fact duly authorized, one complete set of which shall be     
delivered by the successor Trustee to each Servicer, one complete set to the    
Trustee so removed and one complete set to the successor so appointed. The      
successor trustee shall notify each Rating Agency of any removal of the Trustee.

      Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to this Section 8.07 shall become effective upon     
acceptance of appointment by the successor trustee as provided in Section 8.08. 

          Section 8.08 Successor Trustee. Any successor trustee appointed as
provided in Section 8.07 shall execute, acknowledge and deliver to the Depositor
and to its predecessor trustee and the Servicers an instrument accepting such   
appointment hereunder and thereupon the resignation or removal of the           
predecessor trustee shall become effective and such successor trustee, without  
any further act, deed or conveyance, shall become fully vested with all the     
rights, powers, duties and obligations of its predecessor hereunder, with the   
like effect as if originally named as trustee herein. The Depositor, the        
Servicers and the predecessor trustee shall execute and deliver such instruments
and do such other things as may reasonably be required for more fully and       
certainly vesting and confirming in the successor trustee all such rights,      
powers, duties, and obligations.                                                

         No successor trustee shall accept appointment as provided in this
Section 8.08 unless at the time of its acceptance, the successor trustee is     
eligible under Section 8.06 and its appointment does not adversely affect the   
then current rating of the Certificates.                                        

            Upon acceptance of appointment by a successor trustee as provided in
this Section 8.08, the Depositor shall mail notice of the succession of such    
trustee hereunder to all Holders of Certificates. If the Depositor fails to mail
such notice within 10 days after acceptance of appointment by the successor     
trustee, the successor trustee shall cause such notice to be mailed at the      
expense of the Depositor.                                                       

            Section 8.09 Merger or Consolidation of the Trustee. Any corporation
into which the Trustee may be merged or converted or with which it may be       
consolidated or any corporation resulting from any merger, conversion or        
consolidation to which the Trustee shall be a party, or any corporation         
succeeding to the business of the Trustee, shall be the successor of the Trustee
hereunder; provided, that such corporation shall be eligible under Section 8.06 
without the execution or filing of any paper or further act on the part of any  
of the parties hereto, anything herein to the contrary notwithstanding. In      
connection with the succession to the Trustee under this Agreement by any Person
(i) into which the Trustee may be merged or consolidated, or (ii) which may be  
appointed as a successor to the Trustee, the Trustee shall notify the Depositor 
of such succession or appointment and shall furnish to the Depositor in writing 
and in form and substance reasonably satisfactory to the Depositor, all         
information reasonably necessary for the Trustee to accurately and timely       
report, pursuant to Section 8.12(g), the event under Item 6.02 of Form 8-K      
pursuant to the Exchange Act (if such reports under the Exchange Act are        
required to be filed under the Exchange Act).                                   

   Section 8.10 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the    
purpose of meeting any legal requirements of any jurisdiction in which any part 
of the Trust Fund or property securing any Mortgage Note may at the time be     
located, the applicable Servicer and the Trustee acting jointly shall have the  
power and shall execute and deliver all instruments to appoint one or more      
Persons approved by the Trustee to act as co-trustee or co-trustees jointly with
the Trustee, or separate trustee or separate trustees, of all or any part of the
Trust Fund, and to vest in such Person or Persons, in such capacity and for the 
benefit of the Certificateholders, such title to the Trust Fund or any part     
thereof, whichever is applicable, and, subject to the other provisions of this  
Section 8.10, such powers, duties, obligations, rights and trusts as the        
applicable Servicer and the Trustee may consider appropriate. If any Servicer   
shall not have joined in such appointment within 15 days after the receipt by   
such Servicer of a request to do so, or in the case an Event of Default shall   
have occurred and be continuing, the Trustee alone shall have the power to make 
such appointment. No co-trustee or separate trustee hereunder shall be required 
to meet the terms of eligibility as a successor trustee under Section 8.06 and  
no notice to Certificateholders of the appointment of any co-trustee or separate
trustee shall be required under Section 8.08.                                   

            Every separate trustee and co-trustee shall, to the extent permitted
by law, be appointed and act subject to the following provisions and conditions:

      (a) To the extent necessary to effectuate the purposes of this
Section 8.10, all rights, powers, duties and obligations conferred or imposed   
upon the Trustee, except for the obligation of the Trustee under this Agreement 
to advance funds on behalf of a Servicer, shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee   
jointly (it being understood that such separate trustee or co-trustee is not    
authorized to act separately without the Trustee joining in such act), except to
the extent that under any law of any jurisdiction in which any particular act or
acts are to be performed (whether as Trustee hereunder or as successor to a     
Servicer hereunder), the Trustee shall be incompetent or unqualified to perform 
such act or acts, in which event such rights, powers, duties and obligations    
(including the holding of title to the applicable Trust Fund or any portion     
thereof in any such jurisdiction) shall be exercised and performed singly by    
such separate trustee or co-trustee, but solely at the direction of the Trustee;

           (b) No trustee hereunder shall be held personally liable because of
any act or omission of any other trustee hereunder and such appointment shall   
not, and shall not be deemed to, constitute any such separate trustee or        
co-trustee as agent of the Trustee;                                             

           (c) The Trustee may at any time accept the resignation of or remove
any separate trustee or co-trustee; and                                         

        (d) The Trust Fund, and not the Trustee, shall be liable for the
payment of reasonable compensation, reimbursement and indemnification to any    
such separate trustee or co-trustee.                                            

          Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the separate trustees and co-trustees, when
and as effectively as if given to each of them. Every instrument appointing any 
separate trustee or co-trustee shall refer to this Agreement and the conditions 
of this Article VIII. Each separate trustee and co-trustee, upon its acceptance 
of the trusts conferred, shall be vested with the estates or property specified 
in its instrument of appointment, either jointly with the Trustee or separately,
as may be provided therein, subject to all the provisions of this Agreement,    
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every  
such instrument shall be filed with the Trustee and a copy thereof given to each
Servicer and the Depositor.                                                     

           Any separate trustee or co-trustee may, at any time, constitute the
Trustee its agent or attorney-in-fact, with full power and authority, to the    
extent not prohibited by law, to do any lawful act under or in respect of this  
Agreement on its behalf and in its name. If any separate trustee or co-trustee  
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the   
Trustee, to the extent permitted by law, without the appointment of a new or    
successor trustee.                                                              

     Section 8.11 Tax Matters. It is intended that the assets with
respect to which any REMIC election pertaining to the Trust Fund is to be made, 
as set forth in the Preliminary Statement, shall constitute, and that the       
conduct of matters relating to such assets shall be such as to qualify such     
assets as, a "real estate mortgage investment conduit" as defined in and in     
accordance with the REMIC Provisions. In furtherance of such intention, the     
Trustee covenants and agrees that it shall act as agent (and the Trustee is     
hereby appointed to act as agent) on behalf of each Trust REMIC and that in such
capacity it shall:                                                              

            (a) prepare and file in a timely manner, a U.S. Real Estate Mortgage
Investment Conduit (REMIC) Income Tax Return (Form 1066 or any successor form   
adopted by the Internal Revenue Service) and prepare and file with the Internal 
Revenue Service and applicable state or local tax authorities income tax or     
information returns for each taxable year with respect to each Trust REMIC      
containing such information and at the times and in the manner as may be        
required by the Code or state or local tax laws, regulations, or rules, and     
furnish to Certificateholders the schedules, statements or information at such  
times and in such manner as may be required thereby;                            

         (b) within thirty days of the Closing Date, apply for an employer
identification number from the Internal Revenue Service via Form SS-4 or any    
other acceptable method for all tax entities and shall also furnish to the      
Internal Revenue Service, on Form 8811 or as otherwise may be required by the   
Code, the name, title, address, and telephone number of the person that the     
Holders of the Certificates may contact for tax information relating thereto,   
together with such additional information as may be required by such Form, and  
update such information at the time or times in the manner required by the Code;

            (c) make an election that each of Pooling-Tier REMIC-1, Pooling-Tier
REMIC-2, the Lower-Tier REMIC and the Upper-Tier REMIC be treated as a REMIC on 
the federal tax return for its first taxable year (and, if necessary, under     
applicable state law);                                                          

    (d) prepare and forward to the Certificateholders and to the
Internal Revenue Service and, if necessary, state tax authorities, all          
information returns and reports as and when required to be provided to them in  
accordance with the REMIC Provisions, including the calculation of any original 
issue discount using the prepayment assumption (as described in the Prospectus  
Supplement);                                                                    

            (e) provide information necessary for the computation of tax imposed
on the Transfer of a Residual Certificate to a Person that is a Non-Permitted   
Transferee, or an agent (including a broker, nominee or other middleman) of a   
Non-Permitted Transferee, or a pass-through entity in which a Non-Permitted     
Transferee is the record holder of an interest (the reasonable cost of computing
and furnishing such information may be charged to the Person liable for such    
tax);                                                                           

          (f) to the extent that they are under its control, conduct matters
relating to such assets at all times that any Certificates are Outstanding so as
to maintain the status of each Trust REMIC as a REMIC under the REMIC           
Provisions;                                                                     

          (g) not knowingly or intentionally take any action or omit to take
any action that would cause the termination of the REMIC status of any Trust    
REMIC created hereunder;                                                        

         (h) pay, from the sources specified in the last paragraph of this
Section 8.11, the amount of any federal or state tax, including prohibited      
transaction taxes as described below, imposed on any Trust REMIC created        
hereunder before its termination when and as the same shall be due and payable  
(but such obligation shall not prevent the Trustee or any other appropriate     
Person from contesting any such tax in appropriate proceedings and shall not    
prevent the Trustee from withholding payment of such tax, if permitted by law,  
pending the outcome of such proceedings);                                       

           (i) cause federal, state or local income tax or information returns
to be signed by the Trustee or such other Person as may be required to sign such
returns by the Code or state or local laws, regulations or rules; and           

            (j) maintain records relating to each Trust REMIC created hereunder,
including the income, expenses, assets, and liabilities thereof on a calendar   
year basis and on the accrual method of accounting and the fair market value and
adjusted basis of the assets determined at such intervals as may be required by 
the Code, as may be necessary to prepare the foregoing returns, schedules,      
statements or information.                                                      

    The Holder of the largest Percentage Interest of the Class R
Certificates shall act as Tax Matters Person for each Trust REMIC, within the   
meaning of Treasury Regulations Section 1.860F-4(d), and the Trustee is hereby  
designated as agent of such Certificateholder for such purpose (or if the       
Trustee is not so permitted, such Holder shall be the Tax Matters Person in     
accordance with the REMIC Provisions). In such capacity, the Trustee shall, as  
and when necessary and appropriate, represent each Trust REMIC created hereunder
in any administrative or judicial proceedings relating to an examination or     
audit by any governmental taxing authority, request an administrative adjustment
as to any taxable year of each Trust REMIC created hereunder, enter into        
settlement agreements with any governmental taxing agency, extend any statute of
limitations relating to any tax item of each Trust REMIC created hereunder, and 
otherwise act on behalf of each Trust REMIC in relation to any tax matter or    
controversy involving it.                                                       

            The Trustee shall treat the rights of the Class P Certificateholders
to Prepayment Charges, the rights of the Class X Certificateholders to receive  
amounts in the Excess Reserve Fund Account and the Swap Account (subject to the 
obligation to pay Basis Risk CarryForward Amounts and Upper-Tier CarryForward   
Amounts) and the rights of the Offered Certificateholders to receive Basis Risk 
CarryForward Amounts and Upper-Tier CarryForward Amounts as the beneficial      
ownership of interests in a grantor trust, and not as obligations of any Trust  
REMIC created hereunder, for federal income tax purposes. The Trustee shall file
or cause to be filed with the Internal Revenue Service Form 1041 or such other  
form as may be applicable and shall furnish or cause to be furnished to the     
Class P Certificateholders, Class X Certificateholders and the Offered          
Certificateholders the respective amounts described above that are received, in 
the time or times and in the manner required by the Code.                       

         To enable the Trustee to perform its duties under this Agreement,
the Depositor shall provide to the Trustee within ten days after the Closing    
Date all information or data that the Trustee requests in writing and determines
to be relevant for tax purposes to the valuations and offering prices of the    
Certificates, including the price, yield, prepayment assumption, and projected  
cash flows of the Certificates and the Mortgage Loans. Moreover, the Depositor  
shall provide information to the Trustee concerning the value, if any, to each  
Class of Certificates of the right to receive Basis Risk CarryForward Amounts   
from the Excess Reserve Fund Account and Basis Risk CarryForward Amounts and    
Upper-Tier CarryForward Amounts from the Swap Account. Thereafter, the          
Depositor shall provide to the Trustee promptly upon written request therefor   
any additional information or data that the Trustee may, from time to time,     
reasonably request to enable the Trustee to perform its duties under this       
Agreement; provided, however, that the Depositor shall not be required to       
provide any information regarding the Mortgage Loans that the Servicer is       
required to provide to the Trustee pursuant to this Agreement. The Depositor    
hereby indemnifies the Trustee for any losses, liabilities, damages, claims, or 
expenses of the Trustee arising from any errors or miscalculations of the       
Trustee that result from any failure of the Depositor to provide pursuant to    
this paragraph accurate information or data to the Trustee on a timely basis.   

           Neither the Servicers nor the Trustee shall (i) permit the creation
of any interests in any Trust REMIC other than the regular and residual         
interests set forth in the Preliminary Statement, (ii) receive any amount       
representing a fee or other compensation for services (except as otherwise      
permitted by this Agreement or the related Mortgage Loan documents) or (iii)    
otherwise knowingly or intentionally take any action, cause the Trust Fund to   
take any action or fail to take (or fail to cause to be taken) any action       
reasonably within its control and the scope of duties more specifically set     
forth herein, that, under the REMIC Provisions, if taken or not taken, as the   
case may be, could (i) endanger the status of any Trust REMIC as a REMIC or (ii)
result in the imposition of a tax upon any Trust REMIC or the Trust Fund        
(including but not limited to the tax on "prohibited transactions" as defined in
Section 860F(a)(2) of the Code and the tax on contributions to a REMIC set forth
in Section 860G(d) of the Code, or the tax on "net income from foreclosure      
property") unless the Trustee receives an Opinion of Counsel (at the expense of 
the party seeking to take such action or, if such party fails to pay such       
expense, at the expense of the Trust Fund, but in no event at the expense of the
Trustee) to the effect that the contemplated action will not, with respect to   
the Trust Fund, any Trust REMIC created hereunder, endanger such status or      
result in the imposition of such a tax).                                        

       If any tax is imposed on "prohibited transactions" of any Trust
REMIC as defined in Section 860F(a)(2) of the Code, on the "net income from     
foreclosure property" of the Pooling-Tier REMIC-1 as defined in Section 860G(c) 
of the Code, on any contribution to any Trust REMIC after the Start-up Day      
pursuant to Section 860G(d) of the Code, or any other tax is imposed, including,
if applicable, any minimum tax imposed on any Trust REMIC pursuant to Sections  
23153 and 24874 of the California Revenue and Taxation Code, if not paid as     
otherwise provided for herein, the tax shall be paid by (i) the Trustee if such 
tax arises out of or results from negligence of the Trustee in the performance  
of any of its obligations under this Agreement, (ii) the applicable Servicer and
the Responsible Party, jointly, in the case of any such minimum tax, and the    
Servicer if such tax arises out of or results from a breach by such Servicer of 
any of its obligations under this Agreement, (iii) the Responsible Party if such
tax arises out of or results from the Responsible Party's obligation to         
repurchase a Mortgage Loan pursuant to Section 2.03, or (iv) in all other cases,
or if the Trustee, the applicable Servicer or the Responsible Party fails to    
honor its obligations under the preceding clause (i), (ii), or (iii), any such  
tax will be paid with amounts otherwise to be distributed to the                
Certificateholders, as provided in Section 4.02(a).                             

        Section 8.12 Periodic Filings. (a) The Trustee and each Servicer
shall reasonably cooperate with the Depositor in connection with the reporting  
requirements of the Trust under the Exchange Act. The Trustee shall prepare for 
execution by the Depositor any Forms 8-K, 10-D and 10-K required by the Exchange
Act and the rules and regulations of the Commission thereunder, in order to     
permit the timely filing thereof pursuant to the terms of this Section 8.12,    
and the Trustee shall file (via the Commission's Electronic Data Gathering and  
Retrieval System) such Forms executed by the Depositor. The Trustee shall have  
no duty to verify information received by it from other Persons (other than     
Subcontractors utilized by the Trustee) in connection with its duties under this
Section 8.12.                                                                   

            (b) Within 15 calendar days after each Distribution Date (subject to
permitted extensions under the Exchange Act), the Trustee shall prepare and file
on behalf of the Trust any Form 10-D required by the Exchange Act, in form and  
substance as required by the Exchange Act. The Trustee shall file each Form 10-D
with a copy of the related Monthly Statement attached thereto. Any disclosure in
addition to the Monthly Statement that is required to be included on Form 10-D  
("Additional Form 10-D Disclosure") shall be prepared by the party responsible  
for preparing such disclosure as set forth on Exhibit Q hereto and the Trustee  
shall compile such disclosure pursuant to the following paragraph. The Trustee  
will have no duty or liability for any failure hereunder to determine or prepare
any Additional Form 10-D Disclosure, except as set forth in the next paragraph. 

          As set forth on Exhibit Q hereto, within 5 calendar days after the
related Distribution Date, certain parties to this Agreement shall be required  
to provide to the Trustee and the Depositor, to the extent known by such        
applicable parties, any Additional Form 10-D Disclosure, if applicable. The     
Trustee shall compile all such information provided to it in a Form 10-D        
prepared by it.                                                                 

After preparing the Form 10-D, the Trustee shall forward
electronically a draft copy of the Form 10-D to the Depositor for review,       
verification and execution by the Depositor. No later than 2 Business Days prior
to the 15th calendar day after the related Distribution Date, an officer of the 
Depositor shall sign the Form 10-D and return an electronic or fax copy of such 
signed Form 10-D (with an original executed hard copy to follow by overnight    
mail) to the Trustee. If a Form 10-D cannot be filed on time or if a previously 
filed Form 10-D needs to be amended, the Trustee will follow the procedures set 
forth in Section 8.12(f)(ii). The signing party at the Depositor can be         
contacted at the Depositor's address for notices set forth in Section           
10.5(b)(ii)(a), or such other address as to which the Depositor has provided    
prior written notice to the Trustee. The Depositor acknowledges that the        
performance by the Trustee of its duties under this Section 8.12(b) related to  
the timely preparation and filing of Form 10-D is contingent, in part, upon each
Servicer and the Depositor and any other Person obligated to provide Additional 
Form 10-D Disclosure as set forth on Exhibit Q hereto observing all applicable  
deadlines in the performance of their duties under this Section 8.12(b). The    
Trustee shall have no liability for any loss, expense, damage, or claim arising 
out of or with respect to any failure to properly prepare and/or timely file    
such Form 10-D, where such failure results from the Trustee's inability or      
failure to obtain or receive, on a timely basis, any information from any party 
hereto (other than the Trustee or any Subcontractor utilized by the Trustee)    
needed to prepare, arrange for execution or file such Form 10-D, not resulting  
from its own negligence, bad faith or willful misconduct.                       

            (c) Within 90 days after the end of each fiscal year of the Trust or
such earlier date as may be required by the Exchange Act (the "10-K Filing      
Deadline"), commencing in March 2007, the Trustee shall prepare and file on     
behalf of the Trust a Form 10-K, in form and substance as required by the       
Exchange Act. Each such Form 10-K shall include the following items, in each    
case to the extent they have been delivered to the Trustee within the applicable
time frames set forth in this Agreement, (i) an annual compliance statement for 
the Trustee, each Servicer and each Subservicer engaged by any Servicer and the 
Trustee, as described under Section 3.22, (ii)(A) the annual reports on         
assessment of compliance with servicing criteria for the Trustee, the Servicers,
each Subservicer engaged by any Servicer and each Servicing Function Participant
utilized by the Servicer or the Trustee, as described under Section 3.23, and   
(B) if any such report on assessment of compliance with servicing criteria      
described under Section 3.23 identifies any material instance of noncompliance, 
disclosure identifying such instance of noncompliance, or such report on        
assessment of compliance with servicing criteria described under Section 3.23 is
not included as an exhibit to such Form 10-K, disclosure that such report is not
included and an explanation why such report is not included, (iii)(A) the       
registered public accounting firm attestation report for the Trustee, each      
Servicer, each Subservicer engaged by a Servicer and each Servicing Function    
Participant utilized by a Servicer or the Trustee, as described under Section   
3.23, and (B) if any registered public accounting firm attestation report       
described under Section 3.23 identifies any material instance of noncompliance, 
disclosure identifying such instance of noncompliance, or if any such registered
public accounting firm attestation report is not included as an exhibit to such 
Form 10-K, disclosure that such report is not included and an explanation why   
such report is not included, and (iv) a certification in the form attached      
hereto as Exhibit L, with such changes as may be necessary or appropriate as a  
result of changes promulgated by the Commission (the "Sarbanes Certification"), 
which shall be signed by the senior officer of the Depositor in charge of       
securitization. Any disclosure or information in addition to (i) through (iv)   
above that is required to be included on Form 10-K ("Additional Form 10-K       
Disclosure") shall be prepared by the party responsible for preparing such      
disclosure as set forth on Exhibit X hereto, and the Trustee shall compile such 
disclosure pursuant to the following paragraph. The Trustee will have no duty or
liability for any failure hereunder to determine or prepare any Additional Form 
10-K Disclosure, except as set forth in the next paragraph.                     

         As set forth on Exhibit R hereto, no later than March 1st of each
year (or, in the case of the Servicers, March 5th of each year) that the Trust  
is subject to the Exchange Act reporting requirements, commencing in 2007,      
certain parties to this Agreement shall be required to provide to the Trustee   
and the Depositor, to the extent known by such applicable parties, any          
Additional Form 10-K Disclosure, if applicable. The Trustee shall compile all   
such information provided to it in a Form 10-K prepared by it.                  

After preparing the Form 10-K, the Trustee shall forward
electronically a draft copy of the Form 10-K to the Depositor for review,       
verification and execution by the Depositor. No later than 5:00 p.m. EST on the 
3rd Business Day prior to the 10-K Filing Deadline, an officer of the Depositor 
shall sign the Form 10-K and return an electronic or fax copy of such signed    
Form 10-K (with an original executed hard copy to follow by overnight mail) to  
the Trustee. If a Form 10-K cannot be filed on time or if a previously filed    
Form 10-K needs to be amended, the Trustee will follow the procedures set forth 
in Section 8.12(f)(ii). The signing party at the Depositor can be contacted at  
the Depositor's address for notices set forth in Section 10.5(b)(ii)(a), or such
other address as to which the Depositor has provided prior written notice to the
Trustee. The Depositor and each Servicer acknowledge that the performance by the
Trustee of its duties under this Section 8.12(c) related to the timely          
preparation and filing of Form 10-K is contingent, in part, upon each Servicer  
(and any Subservicer or Servicing Function Participant engaged by a Servicer)   
and the Depositor and any other Person obligated to provide Additional Form 10-K
Disclosure as set forth on Exhibit R hereto, observing all applicable deadlines 
in the performance of their duties under this Section 8.12(c), Section 8.12(d), 
Section 3.22 and Section 3.23. The Trustee shall have no liability for any loss,
expense, damage or claim arising out of or with respect to any failure to       
properly prepare and/or timely file such Form 10-K, where such failure results  
from the Trustee's inability or failure to obtain or receive, on a timely basis,
any information from any party hereto (other than the Trustee or any            
Subcontractor utilized by the Trustee) needed to prepare, arrange for execution 
or file such Form 10-K, not resulting from its own negligence, bad faith or     
willful misconduct.                                                             

         (d) In connection with the execution of a Sarbanes Certification,
the Trustee shall sign a certification (in the form attached hereto as Exhibit  
M, with such changes as may be necessary or appropriate as a result of changes  
promulgated by the Commission) for the benefit of the Depositor and its         
officers, directors and Affiliates, and each Servicer shall sign a certification
solely with respect to such Servicer (in the form attached hereto as Exhibit N, 
with such changes as may be necessary or appropriate as a result of changes     
promulgated by the Commission) for the benefit of the Depositor, the Trustee and
their respective officers, directors and Affiliates. Each such certification    
shall be delivered to the Depositor no later than March 10th of each year (or if
such day is not a Business Day, the immediately preceding Business Day) and the 
Depositor shall deliver the Sarbanes Certification no later than the time set   
forth for the delivery to the Trustee of the signed Form 10-K pursuant to       
Section 8.12(d) for such year. In the event that prior to the filing date of the
Form 10-K in March of each year, the Trustee or any Servicer has actual         
knowledge of information material to the Sarbanes Certification, that party     
shall promptly notify the Depositor and each of the other parties signing the   
certifications. In addition, (i) the Trustee shall indemnify and hold harmless  
the Depositor and the Sponsor and their officers, directors, employees, agents  
and Affiliates from and against any losses, damages, penalties, fines,          
forfeitures, reasonable and necessary legal fees and related costs, judgments   
and other costs and expenses arising out of or based upon any breach of the     
Trustee's obligations under this Section 8.12(d) or any material misstatement or
material omission contained in any information, report, certification,          
accountants' letter or other material provided in written or electronic form    
pursuant to Sections 3.23 and 8.12 of this Agreement and Exhibits Q, R and S to 
this Agreement provided by or on behalf of the Trustee or any Subcontractor     
utilized by the Trustee (excluding any information, report, certification,      
accountants' letter or other materials provided in written or electronic form by
or on behalf of any Person other than the Trustee or any Subcontractor utilized 
by the Trustee), negligence, bad faith or willful misconduct in connection      
therewith, and (ii) each Servicer, severally and not jointly, shall indemnify   
and hold harmless the Depositor, the Sponsor, the Trustee and their respective  
officers, directors, employees, agents and Affiliates from and against any      
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal  
fees and related costs, judgments and other costs and expenses arising out of or
based upon any breach of the applicable Servicer's obligations under this       
Section 8.12(d) or any material misstatement or material omission, negligence,  
bad faith or willful misconduct of such Servicer in connection therewith. If the
indemnification provided for herein is unavailable or insufficient to hold      
harmless any indemnified party, then (i) the Trustee agrees in connection with a
breach of the Trustee's obligations under this Section 8.12(d) or any material  
misstatement or material omission contained in any information, report,         
certification, accountants' letter or other material provided in written or     
electronic form pursuant to Sections 3.23 and 8.12 of this Agreement and        
Exhibits T, U and V to this Agreement provided by or on behalf of the Trustee or
any Subcontractor utilized by the Trustee (excluding any information, report,   
certification, accountants' letter or other materials provided in written or    
electronic form by or on behalf of any Person other than the Trustee or any     
Subcontractor utilized by the Trustee), negligence, bad faith or willful        
misconduct in connection therewith that it shall contribute to the amount paid  
or payable by the Depositor and the Sponsor as a result of the losses, claims,  
damages or liabilities of the Depositor and the Sponsor in such proportion as is
appropriate to reflect the relative fault of the Depositor and the Sponsor on   
the one hand and the Trustee on the other and (ii) each Servicer agrees that it 
shall contribute to the amount paid or payable by such indemnified party as a   
result of the losses, claims, damages or liabilities of such indemnified party  
in such proportion as is appropriate to reflect the relative fault of such      
indemnified party, on the one hand, and such Servicer, on the other hand, in    
connection with a breach of the Servicers' obligations under this Section       
8.12(d) or any material misstatement or material omission, negligence, bad faith
or willful misconduct of such Servicer in connection therewith.                 

           (e) Upon any filing with the Commission, the Trustee shall promptly
deliver to the Depositor a copy of each such executed report, statement or      
information.                                                                    

          (f) (i) The obligations set forth in paragraphs (a) through (d) of
this Section shall only apply with respect to periods for which reports are     
required to be filed with respect to the Trust under the Exchange Act. Prior to 
January 30 of the first year in which the Trustee is able to do so under        
applicable law, the Trustee shall file a Form 15 Suspension Notification with   
respect to the Trust, with a copy to the Depositor. At any time after the filing
of a Form 15 Suspension Notification, if the number of Holders of the Offered   
Certificates of record exceeds the number set forth in Section 15(d) of the     
Exchange Act or the regulations promulgated pursuant thereto which would cause  
the Trust to again become subject to the reporting requirements of the Exchange 
Act, the Trustee shall recommence preparing and filing reports on Form 10-K,    
10-D and 8-K as required pursuant to this Section 8.12 and the parties hereto   
shall again have the obligations set forth in this Section.                     

            (ii) In the event that the Trustee is unable to timely file with the
Commission all or any required portion of any Form 8-K, 10-D or 10-K
required to be filed pursuant to this Agreement because required    
    disclosure information was either not delivered to it or delivered to it
      after the delivery deadlines set forth in this Agreement, the Trustee will
   immediately notify the Depositor and the Servicers. In the case of Form
10-D and 10-K, the Depositor, Servicers and Trustee will thereupon  
cooperate to prepare and file a Form 12b-25 and a 10-DA and 10-KA as
   applicable, pursuant to Rule 12b-25 of the Exchange Act. In the case of
  Form 8-K, the Trustee will, upon receipt of all disclosure information
    required to be included on Form 8-K, include such disclosure information
   on the next Form 10-D. In the event that any previously filed Form 8-K,
  10-D or 10-K needs to be amended, the party to this Agreement deciding
    that an amendment to such Form 8-K, 10-D or 10-K is required will notify
the Depositor, the Trustee and the Servicers and such parties will  
      cooperate to prepare any necessary Form 8-KA, 10-DA or 10-KA. Any Form 15,
     Form 12b-25 or any amendment to Form 8-K, 10-D or 10-K shall be signed by
     an officer of the Depositor. The Depositor and Servicers acknowledge that
   the performance by the Trustee of its duties under this Section 8.12(f)
     related to the timely preparation and filing of Form 15, a Form 12b-25 or
    any amendment to Form 8-K, 10-D or 10-K is contingent upon the Servicers
 and the Depositor observing all applicable deadlines (and the related
grace periods thereto) in the performance of their duties under this
Section 8.12 and Sections 3.22 and 3.23. The Trustee shall have no  
 liability for any loss, expense, damage, claim arising out of or with
  respect to any failure to properly prepare and/or timely file any such
    Form 15, Form 12b-25 or any amendments to Forms 8-K, 10-D or 10-K, where
     such failure results from the Trustee's inability or failure to obtain or
    receive, on a timely basis, any information from any party hereto (other
    than the Trustee or any Subcontractor utilized by the Trustee) needed to
   prepare, arrange for execution or file such Form 15, Form 12b-25 or any
amendments to Forms 8-K, 10-D or 10-K, not resulting from its own   
negligence, bad faith or willful misconduct.                        

          (g) Within four (4) Business Days after the occurrence of an event
requiring disclosure on Form 8-K (each such event, a "Reportable Event"), and   
also if requested by the Depositor, the Trustee shall prepare and file on behalf
of the Trust any Form 8-K, as required by the Exchange Act, provided that the   
Depositor shall file the initial Form 8-K in connection with the issuance of the
Certificates. Any disclosure or information related to a Reportable Event or    
that is otherwise required to be included on Form 8-K ("Form 8-K Disclosure     
Information") shall be prepared by the party responsible for preparing such     
disclosure as set forth on Exhibit S hereto and compiled by the Trustee pursuant
to the following paragraph. The Trustee will have no duty or liability for any  
failure hereunder to determine or prepare any Form 8-K Disclosure Information or
any Form 8-K, except as set forth in the next paragraph.                        

     As set forth on Exhibit S hereto, for so long as the Trust is
subject to the Exchange Act reporting requirements, no later than noon (Eastern 
Standard Time) on the 2nd Business Day after the occurrence of a Reportable     
Event certain parties to this Agreement shall be required to provide to the     
Depositor and the Trustee, to the extent known by such applicable parties, any  
Form 8-K Disclosure Information, if applicable. The Trustee shall compile all   
such information provided to it in a Form 8-K prepared by it.                   

After preparing the Form 8-K, the Trustee shall forward 
electronically a draft copy of the Form 8-K to the Depositor for review,        
verification and execution by the Depositor. No later than the end of the 3rd   
Business Day after the Reportable Event, an officer of the Depositor shall sign 
the Form 8-K and return an electronic or fax copy of such signed Form 8-K (with 
an original executed hard copy to follow by overnight mail) to the Trustee. If a
Form 8-K cannot be filed on time or if a previously filed Form 8-K needs to be  
amended, the Trustee will follow the procedures set forth in Section            
8.12(f)(ii). The signing party at the Depositor can be contacted at the         
Depositor's address for notices set forth in Section 10.5(b)(ii)(a), or such    
other address as to which the Depositor has provided prior written notice to the
Trustee. The Depositor acknowledges that the performance by the Trustee of its  
duties under this Section 8.12(g) related to the timely preparation and filing  
of Form 8-K is contingent, in part, upon each Servicer and the Depositor and any
other Person obligated to provide Form 8-K Disclosure Information as set forth  
on Exhibit S hereto, observing all applicable deadlines in the performance of   
their duties under this Section 8.12(g). The Trustee shall have no liability for
any loss, expense, damage or claim arising out of or with respect to any failure
to properly prepare and/or timely file such Form 8-K, where such failure results
from the Trustee's inability or failure to obtain or receive, on a timely basis,
any information from any party hereto (other than the Trustee or any            
Subcontractor utilized by the Trustee) needed to prepare, arrange for execution 
or file such Form 8-K, not resulting from its own negligence, bad faith or      
willful misconduct.                                                             

      (h) The Trustee shall have no liability for any loss, expense,
damage or claim arising out of or resulting from (i) the accuracy or inaccuracy 
of any Additional Form 10-D Disclosure, Additional Form 10-K Disclosure or Form 
8-K Disclosure Information (excluding any information therein provided by the   
Trustee or any Subcontractor utilized by the Trustee) provided to the Trustee in
connection with the preparation of Forms 10-D, 10-K and 8-K pursuant to this    
Section 8.12, or (ii) the failure of the Depositor to timely execute and return 
for filing any Forms 10-D, 10-K and 8-K required to be filed by the Trustee     
pursuant to this Section 8.12, in either case, not resulting from the Trustee's 
own negligence, bad faith or misconduct.                                        

            Section 8.13 Tax Treatment of Upper-Tier CarryForward Amounts, Basis
Risk CarryForward Amounts and Class IO Shortfalls; Tax Classification of the    
Excess Reserve Fund Account, Swap Account and the Interest Rate Swap Agreement. 
For federal income tax purposes, the Trustee shall treat the Excess Reserve Fund
Account and the Swap Account as beneficially owned by the holders of the Class X
Certificates and shall treat such portion of the Trust Fund as a grantor trust, 
within the meaning of subpart E, Part I of subchapter J of the Code. The Trustee
shall treat the rights that each Class of Offered Certificates has to receive   
payments of Basis Risk CarryForward Amounts, and to the extent not paid from the
Excess Reserve Fund Account, Basis Risk CarryForward Amounts from the Swap      
Account (together with Basis Risk CarryForward Amounts from the Excess Reserve  
Fund Account) as rights to receive payments under an interest rate cap contract 
written by the Class X Certificateholder in favor of each such Class and        
beneficially owned by each such Class through the grantor trust. Accordingly,   
each Class of Certificates (excluding the Class X, Class P and Class R          
Certificates) will be comprised of two components - an Upper-Tier Regular       
Interest and an interest in an interest rate cap contract, and the Class X      
Certificates will be comprised of four components - two Upper-Tier Regular      
Interests (the Class X Interest and the Class IO Interest), an interest in the  
Excess Reserve Fund Account, subject to obligation to pay Basis Risk            
CarryForward Amounts, and ownership of the Swap Account and the Interest Rate   
Swap Agreement, subject to the obligation to pay Upper-Tier CarryForward Amounts
including, but without duplication, Basis Risk CarryForward Amounts. The Trustee
shall allocate the issue price for a Class of Certificates among the respective 
components for purposes of determining the issue price of the Upper-Tier Regular
Interest component based on information received from the Depositor. Unless     
otherwise advised by the Depositor in writing, for federal income tax purposes, 
the Trustee is hereby directed to assign a value of zero to the right of each   
Holder of a Offered Certificate to receive the related Upper-Tier CarryForward  
Amount and, without duplication, the related Basis Risk CarryForward Amount for 
purposes of allocating the purchase price of a Offered Certificate acquired by  
an initial Holder thereof between such right and the related Upper-Tier Regular 
Interest.                                                                       

       Holders of Offered Certificates shall also be treated as having
agreed to pay, on each Distribution Date, to the Holders of the Class X         
Certificates an aggregate amount equal to the excess, if any, of (i) Net Swap   
Payments and Swap Termination Payments (other than Defaulted Swap Termination   
Payments) over (ii) the sum of amounts payable on the Class X Interest available
for such payments and amounts payable on the Class IO Interest (such excess, a  
"Class IO Shortfall"), first from interest and then from principal distributable
on the Offered Certificates. A Class IO Shortfall payable from interest         
collections shall be allocated pro rata among such Offered Certificates based on
the amount of interest otherwise payable to such Class of Offered Certificates, 
and a Class IO Shortfall payable from principal collections shall be allocated  
in reverse sequential order beginning with the most subordinate Class of Offered
Certificates then Outstanding.                                                  

    Any payments of Class IO Shortfalls shall be treated for tax
purposes as having been received by the Holders of such Class of Offered        
Certificates in respect of the corresponding Upper-Tier Regular Interest and as 
having been paid by such Holders to the Holders of the Class X Certificates     
through the Swap Account. In the event any class of Upper-Tier Regular Interest 
corresponding to a class of Offered Certificates is subject to the Upper-Tier   
REMIC WAC Rate, and such rate exceeds the applicable Pass-Through Rate of the   
Corresponding Class of Certificates as a result of a Swap Termination Payment,  
such excess shall be deemed first paid to the related Upper-Tier Regular        
Interest and then paid to the Class X Certificates in a manner analogous to     
Class IO Shortfalls.                                                            

ARTICLE IX

 TERMINATION

    Section 9.01 Termination upon Liquidation or Purchase of the
Mortgage Loans. Subject to Section 9.03, the obligations and responsibilities of
the Depositor, the Servicers, the Responsible Party and the Trustee created     
hereby with respect to the Trust Fund shall terminate upon the earlier of (a)   
the purchase, on or after the Optional Termination Date by HomEq, of all        
Mortgage Loans (and REO Properties) at the price equal to the sum of (i) 100% of
the unpaid principal balance of each Mortgage Loan (other than in respect of REO
Property) plus accrued and unpaid interest thereon at the applicable Mortgage   
Rate, (ii) the lesser of (x) the appraised value of any REO Property as         
determined by the higher of two appraisals completed by two independent         
appraisers selected by HomEq at the expense of HomEq, plus accrued and unpaid   
interest on each Mortgage Loan at the applicable Mortgage Rate and (y) the      
unpaid principal balance of each Mortgage Loan related to any REO Property, in  
each case plus accrued and unpaid interest thereon at the applicable Mortgage   
Rate, and (iii) any Swap Termination Payment owed to the Swap Provider pursuant 
to the Interest Rate Swap Agreement, and (b) the later of (i) the maturity or   
other liquidation (or any Advance with respect thereto) of the last Mortgage    
Loan remaining in the Trust Fund and the disposition of all REO Property and    
(ii) the distribution to Certificateholders of all amounts required to be       
distributed to them pursuant to this Agreement. In no event shall the trusts    
created hereby continue beyond the expiration of 21 years from the death of the 
survivor of the descendants of Joseph P. Kennedy, the late Ambassador of the    
United States to the Court of St. James's, living on the date hereof.           

          Notwithstanding anything to the contrary contained herein, no such
purchase shall be permitted unless (i) after distribution of the proceeds       
thereof to the Certificateholders (other than the Holders of the Class X, Class 
P and Residual Certificates) pursuant to Section 9.02, the distribution of the  
remaining proceeds to the Class X and Class P Certificates is sufficient to pay 
the outstanding principal amount of and accrued and unpaid interest on the NIM  
Securities, to the extent the NIM Securities are then outstanding, or (ii) prior
to such purchase, HomEq shall have deposited in the related Collection Account  
an amount to be remitted to the NIM Trustee that, together with such remaining  
proceeds, will be sufficient to pay the outstanding principal amount of and     
accrued and unpaid interest on the NIM Securities, to the extent the NIM        
Securities are then outstanding.                                                

      Section 9.02 Final Distribution on the Certificates. If on any
Remittance Date, HomEq determines that there are no Outstanding Mortgage Loans  
and no other funds or assets in the Trust Fund other than the funds in the      
Collection Accounts, HomEq shall direct the Trustee promptly to send a Notice of
Final Distribution to each Certificateholder and the Swap Provider. If HomEq    
elects to terminate the Trust Fund pursuant to clause (a) of Section 9.01, HomEq
shall notify, by the 25th day of the month preceding the month of the final     
distribution, HomEq shall notify the Depositor and the Trustee of the date HomEq
intends to terminate the Trust Fund and of the applicable repurchase price of   
the Mortgage Loans and REO Properties.                                          

           A Notice of Final Distribution, specifying the Distribution Date on
which Certificateholders may surrender their Certificates for payment of the    
final distribution and cancellation, shall be given promptly by the Trustee by  
letter to Certificateholders mailed not earlier than the 10th day and not later 
than the 15th day of the month of such final distribution. Any such Notice of   
Final Distribution shall specify (a) the Distribution Date upon which final     
distribution on the Certificates will be made upon presentation and surrender of
Certificates at the office therein designated, (b) the amount of such final     
distribution, (c) the location of the office or agency at which such            
presentation and surrender must be made, and (d) that the Record Date otherwise 
applicable to such Distribution Date is not applicable, distributions being made
only upon presentation and surrender of the Certificates at the office therein  
specified. The Trustee will give such Notice of Final Distribution to each      
Rating Agency at the time such Notice of Final Distribution is given to         
Certificateholders.                                                             

            In the event such Notice of Final Distribution is given, HomEq shall
cause all funds in its Collection Account to be remitted to the Trustee for     
deposit in the Distribution Account on the Business Day prior to the applicable 
Distribution Date in an amount equal to the final distribution in respect of the
Certificates. Upon such final deposit with respect to the Trust Fund and the    
receipt by the Trustee of a Request for Release therefor, the Trustee shall     
promptly release to HomEq, the Custodial Files for the Mortgage Loans.          

        Upon presentation and surrender of the Certificates, the Trustee
shall cause to be distributed to the Certificateholders of each Class (after    
reimbursement of all amounts due to HomEq, the Depositor and the Trustee        
hereunder), in each case on the final Distribution Date and in the order set    
forth in Section 4.02, in proportion to their respective Percentage Interests,  
with respect to Certificateholders of the same Class, up to an amount equal to  
(i) as to each Class of Regular Certificates (except the Class X Certificates), 
the Certificate Balance thereof plus for each such Class and the Class X        
Certificates accrued interest thereon in the case of an interest-bearing        
Certificate and all other amounts to which such Classes are entitled pursuant to
Section 4.02 and (ii) as to the Residual Certificates, the amount, if any, which
remains on deposit in the Distribution Account (other than the amounts retained 
to meet claims) after application pursuant to clause (i) above.                 

   In the event that any affected Certificateholders shall not
surrender Certificates for cancellation within six months after the date        
specified in the above mentioned written notice, the Trustee shall give a second
written notice to the remaining Certificateholders to surrender their           
Certificates for cancellation and receive the final distribution with respect   
thereto. If within six months after the second notice all the applicable        
Certificates shall not have been surrendered for cancellation, the Trustee may  
take appropriate steps, or may appoint an agent to take appropriate steps, to   
contact the remaining Certificateholders concerning surrender of their          
Certificates, and the cost thereof shall be paid out of the funds and other     
assets which remain a part of the Trust Fund. If within one year after the      
second notice all Certificates shall not have been surrendered for cancellation,
the Class R Certificateholders shall be entitled to all unclaimed funds and     
other assets of the Trust Fund which remain subject hereto.                     

            Section 9.03 Additional Termination Requirements. In the event HomEq
exercises its purchase option with respect to the Mortgage Loans as provided in 
Section 9.01, the Trust Fund shall be terminated in accordance with the         
following additional requirements, unless the Trustee has been supplied with an 
Opinion of Counsel, at the expense HomEq, to the effect that the failure to     
comply with the requirements of this Section 9.03 will not (i) result in the    
imposition of taxes on "prohibited transactions" on any Trust REMIC as defined  
in Section 860F of the Code, or (ii) cause any Trust REMIC to fail to qualify as
a REMIC at any time that any Certificates are Outstanding:                      

         (a) The Trustee shall sell all of the assets of the Trust Fund to
HomEq, and, by no later than the next Distribution Date after such sale, shall  
distribute to the Certificateholders the proceeds of such sale in complete      
liquidation of each Trust REMIC; and                                            

            (b) The Trustee shall attach a statement to the final federal income
tax return for each Trust REMIC stating that pursuant to Treasury Regulations   
Section 1.860F-1, the first day of the 90-day liquidation period for each such  
Trust REMIC was the date on which the Trustee sold the assets of the Trust Fund 
to HomEq.                                                                       

 ARTICLE X

MISCELLANEOUS PROVISIONS

           Section 10.01 Amendment. This Agreement may be amended from time to
time by the Depositor, the Responsible Party, the Servicers and the Trustee,    
without the consent of any of the Certificateholders (i) to cure any ambiguity  
or mistake, (ii) to correct any defective provision herein or to supplement any 
provision herein which may be inconsistent with any other provision herein,     
(iii) to add to the duties of the Depositor or the Servicers, (iv) to add any   
other provisions with respect to matters or questions arising hereunder or (v)  
to modify, alter, amend, add to or rescind any of the terms or provisions       
contained in this Agreement; provided that any amendment pursuant to clauses    
(iv) or (v) above shall not, as evidenced by an Opinion of Counsel (which       
Opinion of Counsel shall not be an expense of the Trustee or the Trust Fund),   
adversely affect in any material respect the interests of any Certificateholder;
and provided, further, that any such amendment pursuant to clause (iv) or (v)   
above shall not be deemed to adversely affect in any material respect the       
interests of the Certificateholders if the Person requesting the amendment      
obtains a letter from each Rating Agency stating that the amendment would not   
result in the downgrading or withdrawal of the respective ratings then assigned 
to the Certificates; it being understood and agreed that any such letter in and 
of itself will not represent a determination as to the materiality of any such  
amendment and will represent a determination only as to the credit issues       
affecting any such rating. The Trustee, the Depositor, the Responsible Party and
the Servicers also may at any time and from time to time amend this Agreement,  
but without the consent of the Certificateholders to modify, eliminate or add to
any of its provisions to such extent as shall be necessary or helpful to (i)    
maintain the qualification of each Trust REMIC under the Code, (ii) avoid or    
minimize the risk of the imposition of any tax on any Trust REMIC pursuant to   
the Code that would be a claim at any time prior to the final redemption of the 
Certificates or (iii) comply with any other requirements of the Code; provided, 
that the Trustee has been provided an Opinion of Counsel, which opinion shall be
an expense of the party requesting such opinion but in any case shall not be an 
expense of the Trustee or the Trust Fund, to the effect that such action is     
necessary or helpful to, as applicable, (i) maintain such qualification, (ii)   
avoid or minimize the risk of the imposition of such a tax or (iii) comply with 
any such requirements of the Code.                                              

   This Agreement may also be amended from time to time by the
Depositor, the Servicers, the Responsible Party and the Trustee with the consent
of the Holders of Certificates evidencing Percentage Interests aggregating not  
less than 66(2)/3% of each Class of Certificates affected thereby for the       
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of this Agreement or of modifying in any manner the rights of 
the Holders of Certificates; provided, however, that no such amendment shall (i)
reduce in any manner the amount of, or delay the timing of, payments required to
be distributed on any Certificate without the consent of the Holder of such     
Certificate, (ii) adversely affect in any material respect the interests of the 
Holders of any Class of Certificates in a manner other than as described in     
clause (i), without the consent of the Holders of Certificates of such Class    
evidencing, as to such Class, Percentage Interests aggregating not less than    
66(2)/3% or (iii) reduce the aforesaid percentages of Certificates the Holders  
of which are required to consent to any such amendment, without the consent of  
the Holders of all such Certificates then Outstanding.                          

     Notwithstanding any contrary provision of this Agreement, the
Trustee shall not consent to any amendment to this Agreement unless (i) it shall
have first received an Opinion of Counsel, which opinion shall not be an expense
of the Trustee or the Trust Fund, to the effect that such amendment will not    
cause the imposition of any tax on any Trust REMIC or the Certificateholders or 
cause any such Trust REMIC to fail to qualify as a REMIC or the grantor trust to
fail to qualify as a grantor trust at any time that any Certificates are        
Outstanding and (ii) the party seeking such amendment shall have provided       
written notice to the Rating Agencies (with a copy of such notice to the        
Trustee) of such amendment, stating the provisions of the Agreement to be       
amended.                                                                        

            Notwithstanding the foregoing provisions of this Section 10.01, with
respect to any amendment that significantly modifies the permitted activities of
the Trustee or the Servicers, any Certificate beneficially owned by the         
Depositor shall be deemed not to be Outstanding (and shall not be considered    
when determining the percentage of Certificateholders consenting or when        
calculating the total number of Certificates entitled to consent) for purposes  
of determining if the requisite consents of Certificateholders under this       
Section 10.01 have been obtained.                                               

       Promptly after the execution of any amendment to this Agreement
requiring the consent of Certificateholders, the Trustee shall furnish written  
notification of the substance or a copy of such amendment to each               
Certificateholder and each Rating Agency.                                       

       It shall not be necessary for the consent of Certificateholders
under this Section 10.01 to approve the particular form of any proposed         
amendment, but it shall be sufficient if such consent shall approve the         
substance thereof. The manner of obtaining such consents and of evidencing the  
authorization of the execution thereof by Certificateholders shall be subject to
such reasonable regulations as the Trustee may prescribe.                       

            Nothing in this Agreement shall require the Trustee to enter into an
amendment without receiving an Opinion of Counsel (which Opinion shall not be an
expense of the Trustee or the Trust Fund), satisfactory to the Trustee that (i) 
such amendment is permitted and is not prohibited by this Agreement and that all
requirements for amending this Agreement have been complied with (including the 
obtaining of any required consents); and (ii) either (A) the amendment does not 
adversely affect in any material respect the interests of any Certificateholder 
or (B) the conclusion set forth in the immediately preceding clause (A) is not  
required to be reached pursuant to this Section 10.01.                          

            Notwithstanding the foregoing, any amendment to this Agreement shall
require the prior written consent of the Swap Provider if such amendment        
materially and adversely affects the rights or interests of the Swap Provider.  

            Section 10.02 Recordation of Agreement; Counterparts. This Agreement
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, such recordation to be effected by the    
Servicers at the direction and expense of the Depositor, but only upon receipt  
of an Opinion of Counsel to the effect that such recordation materially and     
beneficially affects the interests of the Certificateholders.                   

            For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed          
simultaneously in any number of counterparts, each of which counterparts shall  
be deemed to be an original, and such counterparts shall constitute but one and 
the same instrument.                                                            

         Section 10.03 Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK   
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN THE STATE OF NEW YORK AND  
THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HERETO AND THE              
CERTIFICATEHOLDERS SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.            

           Section 10.04 Intention of Parties. It is the express intent of the
parties hereto that the conveyance (i) of the Mortgage Loans by the Depositor   
and (ii) of the Trust Fund by the Depositor to the Trustee each be, and be      
construed as, an absolute sale thereof. It is, further, not the intention of the
parties that such conveyances be deemed a pledge thereof. However, in the event 
that, notwithstanding the intent of the parties, such assets are held to be the 
property of the Depositor, as the case may be, or if for any other reason this  
Agreement is held or deemed to create a security interest in either such assets,
then (i) this Agreement shall be deemed to be a security agreement within the   
meaning of the Uniform Commercial Code of the State of New York and (ii) the    
conveyances provided for in this Agreement shall be deemed to be an assignment  
and a grant by the Depositor to the Trustee, for the benefit of the             
Certificateholders, of a security interest in all of the assets transferred,    
whether now owned or hereafter acquired.                                        

           The Depositor, for the benefit of the Certificateholders, shall, to
the extent consistent with this Agreement, take such actions as may be necessary
to ensure that, if this Agreement were deemed to create a security interest in  
the Trust Fund, such security interest would be deemed to be a perfected        
security interest of first priority under applicable law and will be maintained 
as such throughout the term of the Agreement. The Depositor shall arrange for   
filing any Uniform Commercial Code continuation statements in connection with   
any security interest granted or assigned to the Trustee for the benefit of the 
Certificateholders.                                                             

            Section 10.05 Notices. (a) The Trustee shall use its best efforts to
promptly provide notice to each Rating Agency with respect to each of the       
following of which it has actual knowledge:                                     

(i) Any material change or amendment to this Agreement; 

            (ii) The occurrence of any Event of Default that has not been cured;

         (iii) The resignation or termination of a Servicer or the Trustee
and the appointment of any successor;                               

         (iv) The repurchase or substitution of Mortgage Loans pursuant to
Section 2.03; and                                                   

(v) The final payment to Certificateholders.            

          (b) In addition, the Trustee shall promptly furnish to each Rating
Agency copies (which may be provided electronically via the Trustee's website)  
of the following:                                                               

            (i) Each report to Certificateholders described in Section 4.03; and

            (ii) Any notice of a purchase of a Mortgage Loan pursuant to Section
2.02, 2.03 or 3.11.                                                 

           All directions, demands, consents and notices hereunder shall be in
writing (unless otherwise indicated in this paragraph) and shall be deemed to   
have been duly given when delivered to: (a) in the case of the Depositor or the 
Underwriter, Morgan Stanley ABS Capital I Inc. or Morgan Stanley & Co.          
Incorporated, (1) Steven Shapiro, Morgan Stanley - SPG Finance, 1585 Broadway,  
10th Floor, New York, New York 10036; (2) Michelle Wilke, Morgan Stanley - Legal
Counsel (Securities), 1585 Broadway, 38th Floor, New York, New York 10036; (3)  
Jeff Williams, Morgan Stanley - Servicing Oversight, 5002 T-Rex Ave., Suite 300,
Boca Raton, Florida 33431; (4) Peter Woroniecki, Morgan Stanley - Whole Loan    
Operations, 750 Seventh Avenue, New York, NY 10019; (5) Scott Samlin, Morgan    
Stanley - RFPG, 1585 Broadway, 38th Floor, New York, New York 10036; and (6) in 
the case of a direction or demand, notification to the following email          
addresses: Jeff.Williams@morganstanley.com, Adrianne.Dicker@morganstanley.com,  
Scott.Samlin@morganstanley.com and John.Monaghan@morganstanley.com; or such     
other address as may be hereafter furnished to the other parties hereto by the  
Depositor in writing; (b) in the case of JPMorgan, JPMorgan Chase Bank, National
Association, in care of Chase Home Finance LLC, 10790 Rancho Bernardo, San      
Diego, California 92127, Attention: Cindy Dunks, with a copy to: 194 Wood Avenue
South, Iselin, New Jersey 08830, Attention: General Counsel, or such other      
address as may be hereafter furnished to the other parties hereto and the Swap  
Provider in writing; (c) in the case of HomEq Servicing Corporation, 4837 Watt  
Avenue, North Highlands, California 95660-5101, Attention: Portfolio Management,
Facsimile No. (916) 339-6995, with a copy to HomEq Servicing Corporation, 1620  
East Roseville Parkway, Suite 210, Second Floor, Roseville, California 95661,   
Attention: Legal Department, Facsimile No. (916) 339-6995, or such other address
as may be hereafter furnished to the other parties hereto and the Swap Provider 
by HomEq in writing; (d) in the case of the Trustee, to Deutsche Bank National  
Trust Company, 1761 East St. Andrew Place, Santa Ana, California 92705,         
Attention: Trust Administration MS06C1 or such other address as the Trustee may 
hereafter furnish to the other parties hereto in writing; (e) in the case of the
Responsible Party, NC Capital Corporation, 18400 Von Karman, Suite 1000, Irvine,
California 92612, Attention: Patrick Flanagan, President, and the Swap Provider 
in writing, or such other address as may be hereafter furnished to the other    
parties hereto by the Responsible Party in writing; (f) in the case of the Swap 
Provider to Morgan Stanley Capital Services Inc., Transaction Management Group, 
1585 Broadway, New York, New York 10036-8293, Attention: Chief Legal Officer,   
Facsimile No. (212) 507-4622, or such other address as the Swap Provider may    
hereafter furnish to the Depositor, the Trustee and the Servicers; in the case  
of each of the Rating Agencies, the address specified therefor in the definition
corresponding to the name of such Rating Agency. Notices to Certificateholders  
shall be deemed given when mailed, first class postage prepaid, to their        
respective addresses appearing in the Certificate Register.                     

           Section 10.06 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any   
reason whatsoever held invalid, 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 or of the Certificates 
or the rights of the Holders thereof.                                           

            Section 10.07 Assignment; Sales; Advance Facilities. Notwithstanding
anything to the contrary contained herein, except as provided in Section 6.04,  
this Agreement may not be assigned by any Servicer without the prior written    
consent of the Trustee and the Depositor; provided, however, each Servicer is   
hereby authorized to enter into an Advance Facility under which (l) such        
Servicer sells, assigns or pledges to an Advancing Person the Servicer's rights 
under this Agreement to be reimbursed for any P&I Advances or Servicing Advances
and/or (2) an Advancing Person agrees to fund some or all P&I Advances or       
Servicing Advances required to be made by such Servicer pursuant to this        
Agreement. No consent of the Trustee, Certificateholders or any other party is  
required before a Servicer may enter into an Advance Facility. Notwithstanding  
the existence of any Advance Facility under which an Advancing Person agrees to 
fund P&I Advances and/or Servicing Advances on a Servicer's behalf, such        
Servicer shall remain obligated pursuant to this Agreement to make P&I Advances 
and Servicing Advances pursuant to and as required by this Agreement, and shall 
not be relieved of such obligations by virtue of such Advance Facility.         

           Reimbursement amounts shall consist solely of amounts in respect of
P&I Advances and/or Servicing Advances made with respect to the Mortgage Loans  
for which a Servicer would be permitted to reimburse itself in accordance with  
this Agreement, assuming such Servicer had made the related P&I Advance(s)      
and/or Servicing Advance(s).                                                    

           The applicable Servicer shall maintain and provide to any successor
servicer a detailed accounting on a loan-by-loan basis as to amounts advanced   
by, pledged or assigned to, and reimbursed to any Advancing Person. The         
successor servicer shall be entitled to rely on any such information provided by
the predecessor servicer, and the successor servicer shall not be liable for any
errors in such information.                                                     

      An Advancing Person who purchases or receives an assignment or
pledge of the rights to be reimbursed for P&I Advances and/or Servicing         
Advances, and/or whose obligations hereunder are limited to the funding of P&I  
Advances and/or Servicing Advances shall not be required to meet the criteria   
for qualification of a Subservicer set forth in this Agreement.                 

         The documentation establishing any Advance Facility shall require
that reimbursement amounts distributed with respect to each Mortgage Loan be    
allocated to outstanding unreimbursed P&I Advances or Servicing Advances (as the
case may be) made with respect to that Mortgage Loan on a "first-in, first out" 
(FIFO) basis. Such documentation shall also require the applicable Servicer to  
provide to the related Advancing Person or its designee loan-by-loan information
with respect to each such reimbursement amount distributed to such Advancing    
Person or Advance Facility trustee on each Distribution Date, to enable the     
Advancing Person or Advance Facility trustee to make the FIFO allocation of each
such reimbursement amount with respect to each applicable Mortgage Loan. The    
applicable Servicer shall remain entitled to be reimbursed by the Advancing     
Person or Advance Facility trustee for all P&I Advances and Servicing Advances  
funded by such Servicer to the extent the related rights to be reimbursed       
therefor have not been sold, assigned or pledged to an Advancing Person.        

        Any amendment to this Section 10.07 or to any other provision of
this Agreement that may be necessary or appropriate to effect the terms of an   
Advance Facility as described generally in this Section 10.07, including        
amendments to add provisions relating to a successor servicer, may be entered   
into by the Trustee, the Depositor, the Responsible Parties and the Servicers   
without the consent of any Certificateholder, notwithstanding anything to the   
contrary in this Agreement, upon receipt by the Trustee of an Opinion of Counsel
that such amendment has no material adverse effect on the Certificateholders or 
written confirmation from the Rating Agencies that such amendment will not      
adversely affect the ratings on the Certificates. Prior to entering into an     
Advance Facility, the applicable Servicer shall notify the lender under such    
facility in writing that: (a) the Advances financed by and/or pledged to the    
lender are obligations owed to such Servicer on a non-recourse basis payable    
only from the cash flows and proceeds received under this Agreement for         
reimbursement of Advances only to the extent provided herein, and the Trustee   
and the Trust are not otherwise obligated or liable to repay any Advances       
financed by the lender; (b) such Servicer will be responsible for remitting to  
the lender the applicable amounts collected by it as reimbursement for Advances 
funded by the lender, subject to the restrictions and priorities created in this
Agreement; and (c) the Trustee shall not have any responsibility to track or    
monitor the administration of the financing arrangement between such applicable 
Servicer and the lender.                                                        

           Section 10.08 Limitation on Rights of Certificateholders. The death
or incapacity of any Certificateholder shall not operate to terminate this      
Agreement or the Trust created hereby, nor entitle such Certificateholder's     
legal representative or heirs to claim an accounting or to take any action or   
commence any proceeding in any court for a petition or winding up of the Trust  
created hereby, or otherwise affect the rights, obligations and liabilities of  
the parties hereto or any of them.                                              

    No Certificateholder shall have any right to vote (except as
provided herein) or in any manner otherwise control the operation and management
of the Trust Fund, or the obligations of the parties hereto, nor shall anything 
herein set forth or contained in the terms of the Certificates be construed so  
as to constitute the Certificateholders from time to time as partners or members
of an association; nor shall any Certificateholder be under any liability to any
third party by reason of any action taken by the parties to this Agreement      
pursuant to any provision hereof.                                               

          No Certificateholder shall have any right by virtue or by availing
itself of any provisions of this Agreement to institute any suit, action or     
proceeding in equity or at law upon or under or with respect to this Agreement, 
unless such Holder previously shall have given to the Trustee a written notice  
of an Event of Default and of the continuance thereof, as herein provided, and  
unless the Holders of Certificates evidencing not less than 25% of the Voting   
Rights evidenced by the Certificates shall also have made written request to the
Trustee to institute such action, suit or proceeding in its own name as Trustee 
hereunder and shall have offered to the Trustee such reasonable indemnity as it 
may require against the costs, expenses, and liabilities to be incurred therein 
or thereby, and the Trustee, for 60 days after its receipt of such notice,      
request and offer of indemnity shall have neglected or refused to institute any 
such action, suit or proceeding; it being understood and intended, and being    
expressly covenanted by each Certificateholder with every other                 
Certificateholder and the Trustee, that no one or more Holders of Certificates  
shall have any right in any manner whatever by virtue or by availing itself or  
themselves of any provisions of this Agreement to affect, disturb or prejudice  
the rights of the Holders of any other of the Certificates, or to obtain or seek
to obtain priority over or preference to any other such Holder or to enforce any
right under this Agreement, except in the manner herein provided and for the    
common benefit of all Certificateholders. For the protection and enforcement of 
the provisions of this Section 10.08, each and every Certificateholder and the  
Trustee shall be entitled to such relief as can be given either at law or in    
equity.                                                                         

       Section 10.09 Inspection and Audit Rights. Each Servicer agrees
that, on 5 Business Days prior notice, it will permit any representative of the 
Depositor or the Trustee during such Person's normal business hours, to examine 
all the books of account, records, reports and other papers of such Person      
relating to the Mortgage Loans, to make copies and extracts therefrom, to cause 
such books to be audited by independent certified public accountants selected by
the Depositor or the Trustee and to discuss its affairs, finances and accounts  
relating to the Mortgage Loans with its officers, employees and independent     
public accountants (and by this provision each Servicer hereby authorizes said  
accountants to discuss with such representative such affairs, finances and      
accounts), all at such reasonable times and as often as may be reasonably       
requested. Any out-of-pocket expense of a Servicer incident to the exercise by  
the Depositor or the Trustee of any right under this Section 10.09 shall be     
borne by such Servicer.                                                         

          Section 10.10 Certificates Nonassessable and Fully Paid. It is the
intention of the Depositor that Certificateholders shall not be personally      
liable for obligations of the Trust Fund, that the interests in the Trust Fund  
represented by the Certificates shall be nonassessable for any reason           
whatsoever, and that the Certificates, upon due authentication thereof by the   
Trustee pursuant to this Agreement, are and shall be deemed fully paid.         

            Section 10.11 Rule of Construction. Article and section headings are
for the convenience of the reader and shall not be considered in interpreting   
this Agreement or the intent of the parties hereto.                             

        Section 10.12 Waiver of Jury Trial. EACH PARTY HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY, WAIVES (TO THE EXTENT PERMITTED BY APPLICABLE    
LAW) ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR   
RELATING TO THIS AGREEMENT AND AGREES THAT ANY SUCH DISPUTE SHALL BE TRIED      
BEFORE A JUDGE SITTING WITHOUT A JURY.                                          

          Section 10.13 Rights of the Swap Provider. The Swap Provider shall
be deemed a third-party beneficiary of this Agreement to the same extent as if  
it were a party hereto and shall have the right to enforce its rights under this
Agreement.                                                                      

      Section 10.14 Regulation AB Compliance; Intent of the Parties;
Reasonableness. The parties hereto acknowledge 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    
agree to comply with requests made by the Depositor in good faith for delivery  
of information under these provisions on the basis of evolving interpretations  
of Regulation AB. In connection with the Trust, each Servicer and the Trustee   
shall cooperate fully with the Depositor to deliver to the Depositor (including 
its assignees or designees), any and all statements, reports, certifications,   
records and any other information available to such party and reasonably        
necessary in the good faith determination of the Depositor to permit the        
Depositor to comply with the provisions of Regulation AB, together with such    
disclosures relating to each Servicer and the Trustee, as applicable, reasonably
believed by the Depositor to be necessary in order to effect such compliance.   

[SIGNATURE PAGE FOLLOWS]

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            IN WITNESS WHEREOF, the parties hereto have caused their names to be
signed hereto by their respective officers thereunto duly authorized as of the  
day and year first above written.                                               

                    MORGAN STANLEY ABS CAPITAL I INC.,
    as Depositor

         By:  /s/ Steven Shapiro
                                    --------------------------------------------
             Name:  Steven Shapiro
                 Title: Executive Director

               JPMORGAN CHASE BANK, NATIONAL
    ASSOCIATION,
   as Servicer

        By:  /s/ Frances Dixon
                                    --------------------------------------------
            Name:  Frances Dixon
                       Title: Assistant Vice President

              HOMEQ SERVICING CORPORATION,
   as Servicer

      By:  /s/ Arthur Lyon
                                    --------------------------------------------
          Name:  Arthur Lyon
        Title: President

              DEUTSCHE BANK NATIONAL TRUST
                                 COMPANY, solely as Trustee and not in its
           individual capacity

       By:  /s/ Eiko Akiyama
                                    --------------------------------------------
           Name:  Eiko Akiyama
        Title: Associate

        By:  /s/ Ronaldo Reyes
                                    --------------------------------------------
            Name:  Ronaldo Reyes
             Title: Vice President

         NC CAPITAL CORPORATION,
            as Responsible Party

        By:  /s/ Warren Licata
                                    --------------------------------------------
            Name:  Warren Licata
                      Title: SVP, Structured Finance

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SCHEDULE I

Mortgage Loan Schedule

 (Available Upon Request to Trustee)

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 SCHEDULE II

 Morgan Stanley ABS Capital Inc.
 Mortgage Pass-Through Certificates,
 Series 2006-NC1

Representations and Warranties of HomEq, as Servicer

          HomEq hereby makes the representations and warranties set forth in
this Schedule II to the Depositor and the Trustee as of the Closing Date.       
Capitalized terms used but not otherwise defined in the Agreement to which this 
Schedule III is attached shall have the meaning ascribed thereto in the         
Agreement to which this Schedule II is attached.                                

            (1) HomEq is duly organized as a corporation and is validly existing
  and in good standing under the laws of the state of New Jersey, and is
   licensed and qualified to transact any and all business contemplated by
      this Pooling and Servicing Agreement to be conducted by HomEq in any state
   in which a Mortgaged Property securing a Mortgage Loan is located or is
    otherwise not required under applicable law to effect such qualification
   and, in any event, is in compliance with the doing business laws of any
     such State, to the extent necessary to ensure its ability to enforce each
  Mortgage Loan and to service the Mortgage Loans in accordance with the
terms of this Pooling and Servicing Agreement;                      

           (2) HomEq has the full power and authority to service each Mortgage
Loan, and to execute, deliver and perform, and to enter into and    
  consummate the transactions contemplated by this Pooling and Servicing
    Agreement and has duly authorized by all necessary action on the part of
HomEq the execution, delivery and performance of this Pooling and   
   Servicing Agreement; and this Pooling and Servicing Agreement, assuming
   the due authorization, execution and delivery thereof by the Depositor,
      each Responsible Party, the other Servicers and the Trustee, constitutes a
      legal, valid and binding obligation of HomEq, enforceable against HomEq in
accordance with its terms; except to the extent that (a) the        
enforceability thereof may be limited by bankruptcy, insolvency,    
  moratorium, receivership and other similar laws relating to creditors'
      rights generally and (b) the remedy of specific performance and injunctive
and other forms of equitable relief may be subject to the equitable 
   defenses and to the discretion of the court before which any proceeding
therefor may be brought;                                            

    (3) The execution and delivery of this Pooling and Servicing
  Agreement by HomEq, the servicing of the Mortgage Loans required to be
      serviced by HomEq hereunder, the consummation by HomEq of any other of the
  transactions herein contemplated, and the fulfillment of or compliance
     with the terms hereof are in the ordinary course of business of HomEq and
will not (A) result in a breach of any term or provision of the     
organizational documents of HomEq or (B) conflict with, result in a 
   breach, violation or acceleration of, or result in a default under, the
   terms of any other material agreement or instrument to which HomEq is a
party or by which it may be bound, or any law, statute, rule, order,
     regulation, judgment or decree applicable to HomEq or its property of any
     court, regulatory body, administrative agency or governmental body having
 jurisdiction over HomEq; and HomEq is not a party to, bound by, or in
     breach or violation of any indenture or other agreement or instrument, or
    subject to or in violation of any law, statute, rule, order, regulation,
      judgment or decree of any court, regulatory body, administrative agency or
   governmental body having jurisdiction over it, which (w) materially and
      adversely affects or, to HomEq's knowledge, would in the future materially
 and adversely affect, the ability of HomEq to perform its obligations
    under this Pooling and Servicing Agreement, (x) materially and adversely
affects or, to HomEq's knowledge, would in the future materially and
adversely affect, the business, operations, financial condition,    
     properties or assets of HomEq taken as a whole, (y) impair the ability of
      the Trust to realize on the Mortgage Loans, or (z) impair the value of the
Mortgage Loans;                                                     

           (4) HomEq has the facilities, procedures, and experienced personnel
   necessary for the sound servicing of mortgage loans of the same type as
the Mortgage Loans;                                                 

           (5) HomEq does not believe, nor does it have any reason or cause to
     believe, that it cannot perform each and every covenant contained in this
Pooling and Servicing Agreement;                                    

      (6) No action, suit, proceeding or investigation is pending or
      threatened against HomEq, before any court, administrative agency or other
      tribunal asserting the invalidity of this Pooling and Servicing Agreement,
seeking to prevent the consummation of any of the transactions      
    contemplated by this Pooling and Servicing Agreement or 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 HomEq, or in any material impairment of the right or ability of
    HomEq to carry on its business substantially as now conducted, or in any
      material liability on the part of HomEq, or which would draw into question
      the validity of this Pooling and Servicing Agreement or the Mortgage Loans
    or of any action taken or to be taken in connection with the obligations
of HomEq contemplated herein, or which would be likely to impair    
      materially the ability of HomEq to perform under the terms of this Pooling
and Servicing Agreement;                                            

        (7) No consent, approval, authorization or order of any court or
   governmental agency or body is required for the execution, delivery and
  performance by HomEq of, or compliance by HomEq with, this Pooling and
      Servicing Agreement or the servicing of the Mortgage Loans as evidenced by
      the consummation by HomEq of the transactions contemplated by this Pooling
and Servicing Agreement, except for such consents, approvals,       
  authorizations or orders, if any, that have been obtained prior to the
Closing Date; and                                                   

           (8) With respect to each Mortgage Loan serviced by HomEq hereunder,
   to the extent HomEq serviced such Mortgage Loan and to the extent HomEq
      provided monthly reports to the three credit repositories, HomEq has fully
furnished, in accordance with the Fair Credit Reporting Act and its 
implementing regulations, accurate and complete information (i.e.,  
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.                                  

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SCHEDULE III

 Morgan Stanley ABS Capital Inc.
 Mortgage Pass-Through Certificates,
 Series 2006-NC1

Representations and Warranties of the Responsible Party as to the Mortgage Loans

   NC Capital Corporation hereby makes the representations and
warranties set forth in this Schedule III as to the Mortgage Loans only to the  
Depositor, the Servicers and the Trustee, as of January 27, 2006 (the           
"Securitization Closing Date") (unless otherwise expressly indicated).          
Capitalized terms used but not otherwise defined in this Schedule III shall have
the meanings ascribed thereto in the Purchase Agreement.                        

   (1) Mortgage Loans as Described. NC Capital Corporation has
      delivered to the Sponsor, as of January 1, 2006, the Data Tape Information
and that Data Tape Information and the information set forth on the 
Mortgage Loan Schedule (other than item (21) thereof, as to which NC
 Capital Corporation makes no representation or warranty) are true and
correct, including, without limitation, the terms of the Prepayment 
Charges, if any, as of the Securitization Closing Date;             

            (2) Payments Current. All payments required to be made up to January
     1, 2006 for the Mortgage Loan under the terms of the Mortgage Note, other
     than payments not yet 30 days delinquent, have been made and credited. No
      payment required under the Mortgage Loan is 30 days or more delinquent nor
      has any payment under the Mortgage Loan been 30 days or more delinquent at
    any time since the origination of the Mortgage Loan. The first Scheduled
     Payment was or shall be made with respect to the Mortgage Loan on its Due
    Date or within the grace period, all in accordance with the terms of the
related Mortgage Note;                                              

           (3) No Outstanding Charges. There are no defaults in complying with
the terms of the Mortgage, and all taxes, governmental assessments, 
      insurance premiums, water, sewer and municipal charges, leasehold payments
    or ground rents which previously became due and owing have been paid, or
      an escrow of funds has been established in an amount sufficient to pay for
   every such item which remains unpaid and which has been assessed but is
     not yet due and payable. Neither NC Capital Corporation nor any Affiliate
has advanced funds, or induced, solicited or knowingly received any 
advance of funds by a party other than the Mortgagor, directly or   
 indirectly, for the payment of any amount required under the Mortgage
    Loan, except for interest accruing from the date of the Mortgage Note or
     date of disbursement of the Mortgage Loan proceeds, whichever is earlier,
to the day which precedes by one month the Due Date of the first    
installment of principal and interest;                              

         (4) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any 
      respect from the date of origination, except by a written instrument which
    has been recorded, if necessary to protect the interests of the Sponsor,
  and which has been delivered to the Trustee and the terms of which are
 reflected in the Mortgage Loan Schedule, the Data Tape Information or
included in the Mortgage File. The substance of any such waiver,    
      alteration or modification has been approved by the title insurer, if any,
    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, except in connection with an assumption agreement, approved by the
     title insurer, to the extent required by the policy, and which assumption
    agreement is part of the Mortgage Loan File delivered to the Trustee and
  the terms of which are reflected in the Mortgage Loan Schedule and the
Data Tape Information;                                              

         (5) 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, and no such right of rescission, set-off,      
  counterclaim or defense has been asserted with respect thereto, and no
   Mortgagor was a debtor in any state or federal bankruptcy or insolvency
proceeding at the time the Mortgage Loan was originated;            

        (6) Hazard Insurance. Pursuant to the terms of the Mortgage, all
      buildings or other improvements upon the Mortgaged Property are insured by
    a generally acceptable insurer against loss by fire, hazards of extended
 coverage and such other hazards as are provided for in the Fannie Mae
      Guides or by Freddie Mac, as well as all additional requirements set forth
      in Section 3.13 of the Pooling and Servicing Agreement. If required by the
  National Flood Insurance Act of 1968, as amended, the Mortgage Loan is
covered by a flood insurance policy meeting the requirements of the 
   current guidelines of the Federal Insurance Administration is in effect
which policy conforms to Fannie Mae and Freddie Mac, as well as all 
additional requirements set forth in Section 3.13 of the Pooling and
     Servicing Agreement. All individual insurance policies contain a standard
mortgagee clause naming New Century Mortgage Corporation and its    
   successors and assigns as mortgagee, and all premiums thereon have been
 paid. The Mortgage obligates the Mortgagor thereunder to maintain the
   hazard insurance policy at the Mortgagor's cost and expense, and on the
  Mortgagor's failure to do so, authorizes the holder of the Mortgage to
    obtain and maintain such insurance at such Mortgagor's cost and expense,
    and to seek reimbursement therefor from the Mortgagor. Where required by
   state law or regulation, the Mortgagor has been given an opportunity to
    choose the carrier of the required hazard insurance, provided the policy
is not a "master" or "blanket" hazard insurance policy covering a   
      condominium, or any hazard insurance policy covering the common facilities
   of a planned unit development. The hazard insurance policy is the valid
   and binding obligation of the insurer, is in full force and effect, and
    will be in full force and effect and inure to the benefit of the Trustee
     upon the consummation of the transactions contemplated by this Agreement.
  NC Capital Corporation has not engaged in, and has no knowledge of the
     Mortgagor's having engaged in, any act or omission which would impair the
     coverage of any such policy, the benefits of the endorsement provided for
    herein, or the validity and binding effect of either, including, without
limitation, 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 NC Capital
Corporation;                                                        

            (7) 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 and all predatory and
    abusive lending laws applicable to the Mortgage Loan, including, without
   limitation, any provisions therein relating to Prepayment Charges, have
 been complied with, the consummation of the transactions contemplated
      hereby will not involve the violation of any such laws or regulations, and
      NC Capital Corporation shall maintain in its possession, available for the
   Sponsor's or the Trustee's inspection, and shall deliver to the Sponsor
upon demand, evidence of compliance with all such requirements;     

       (8) No Satisfaction of Mortgage. Other than with respect to any
      Mortgage Loan that was subject to a Principal Prepayment in Full occurring
    after the Cut-off Date but prior to the Securitization Closing Date, the
     Mortgage has not been satisfied, cancelled, 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 release, cancellation, subordination
   or rescission. NC Capital Corporation has not waived the performance by
   the Mortgagor of any action, if the Mortgagor's failure to perform such
     action would cause the Mortgage Loan to be in default, nor has NC Capital
   Corporation waived any default resulting from any action or inaction by
the Mortgagor;                                                      

           (9) Location and Type of Mortgaged Property. The Mortgaged Property
is located in the state identified in the Mortgage Loan Schedule and
      consists of a single 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 low rise condominium project, or an
      individual unit in a planned unit development or a de minimis planned unit
      development which is in each case four stories or less; provided, however,
    that any condominium unit, planned unit development, mobile home (double
 wide only) or manufactured dwelling shall conform with the applicable
     Fannie Mae and Freddie Mac requirements regarding such dwellings and that
  no Mortgage Loan is secured by a single parcel of real property with a
      cooperative housing corporation, a log home or, except as specified on the
   Mortgage Loan Schedule, a mobile home erected thereon or by a mixed use
      property, a property in excess of 10 acres or other unique property types.
   As of the date of origination, no portion of the Mortgaged Property was
used for commercial purposes, and since the date of origination, no 
    portion of the Mortgaged Property has been used for commercial purposes;
     provided, that Mortgaged Properties which contain a home office shall not
be considered as being used for commercial purposes as long as the  
      Mortgaged Property has not been altered for commercial purposes and is not
     storing any chemicals or raw materials other than those commonly used for
    homeowner repair, maintenance and/or household purposes. With respect to
      any Mortgage Loan secured by a Mortgaged Property improved by manufactured
      housing, (i) such Mortgage Loan conforms with the applicable Fannie Mae or
     Freddie Mac requirements regarding mortgage loans related to manufactured
dwellings, (ii) the related manufactured housing unit is permanently
    affixed to the land, (iii) the related manufactured housing unit and the
    related land are subject to a Mortgage properly filed in the appropriate
  public recording office and naming New Century Mortgage Corporation as
mortgagee, (iv) the applicable laws of the jurisdiction in which the
     related Mortgaged Property is located will deem the manufactured dwelling
   located on such Mortgaged Property to be a part of the real property on
   which such dwelling is located, and (v) such Manufactured Home Mortgage
Loan is secured by manufactured housing treated as a single family  
residence under Section 25(e)(10) of the Code;                      

   (10) Valid First Lien. The Mortgage is a valid, subsisting,
 enforceable and perfected first lien (with respect to each First Lien
    Mortgage Loan) or second lien (with respect to each Second Lien Mortgage
     Loan) on the Mortgaged Property, including all buildings and improvements
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:                                                 

                     (i) with respect to a Second Lien Mortgage Loan only,
 the lien of the first mortgage on the Mortgaged Property;

                (ii) the lien of current real property taxes and
assessments not yet due and payable;                    

                       (iii) covenants, conditions and restrictions, rights of
            way, easements and other matters of the public record as of the date
        of recording acceptable to prudent mortgage lending institutions
    generally and specifically referred to in the lender's title
         insurance policy delivered to the originator of the Mortgage Loan
       and (a) specifically referred to or otherwise considered in the
           appraisal made for the originator of the Mortgage Loan or (b) which
    do not adversely affect the Appraised Value of the Mortgaged
Property set forth in such appraisal; and               

                        (iv) 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, enforceable and
           perfected first lien and first priority (with respect to each First
       Lien Mortgage Loan) security interest on the property described
            therein and NC Capital Corporation has full right to sell and assign
the same to the Sponsor                                 

      (11) Validity of Mortgage Documents. The Mortgage Note and the
     Mortgage and any other agreement executed and delivered by a Mortgagor in
     connection with a Mortgage Loan are genuine, and each is the legal, valid
      and binding obligation of the maker thereof enforceable in accordance with
     its terms (including, without limitation, any provisions therein relating
      to Prepayment Charges). All parties to the Mortgage Note, the Mortgage and
 any other such related agreement had legal capacity to enter into the
    Mortgage Loan and to execute and deliver the Mortgage Note, the Mortgage
     and any such agreement, and the Mortgage Note, the Mortgage and any other
     such related agreement have been duly and properly executed by other such
     related parties. No fraud, error, omission, misrepresentation, negligence
    or similar occurrence with respect to a Mortgage Loan has taken place on
    the part of any Person, including without limitation, the Mortgagor, any
   appraiser, any builder or developer, or any other party involved in the
     origination of the Mortgage Loan. NC Capital Corporation or its Affiliate
    has reviewed all of the documents constituting the Servicing File and NC
     Capital Corporation has made such inquiries as it deems necessary to make
and confirm the accuracy of the representations set forth herein;   

      (12) Full Disbursement of Proceeds. The Mortgage Loan has been
      closed and the proceeds of the Mortgage Loan have been fully disbursed and
   there is no requirement for future advances thereunder, and any and all
    requirements as to completion of any on-site or off-site improvement and
     as to disbursements of any escrow funds therefor have been complied with.
   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;                                                        

         (13) Ownership. Immediately prior to the transfer contemplated by
the Purchase Agreement, NC Capital Corporation was the sole owner of
    record and holder of the Mortgage Loan and the indebtedness evidenced by
      each Mortgage Note and upon the sale of the Mortgage Loans to the Sponsor,
  NC Capital Corporation retained the Mortgage Files or any part thereof
with respect thereto not delivered to the Sponsor or the Sponsor's  
    designee, in trust only for the purpose of servicing and supervising the
  servicing of each Mortgage Loan. The Mortgage Loan was not assigned or
     pledged, and NC Capital Corporation had good, indefeasible and marketable
    title thereto, and has full right to transfer and sell the Mortgage Loan
   to the Sponsor free and clear of any encumbrance, equity, participation
    interest, lien, pledge, charge, claim or security interest, and has full
right and authority subject to no interest or participation of, or  
  agreement with, any other party, to sell and assign each Mortgage Loan
      pursuant to the Purchase Agreement and following the sale of each Mortgage
Loan, the Sponsor will own such Mortgage Loan free and clear of any 
    encumbrance, equity, participation interest, lien, pledge, charge, claim
   or security interest. After the Securitization Closing Date, NC Capital
      Corporation will have no right to modify or alter the terms of the sale of
   the Mortgage Loan and NC Capital Corporation will have no obligation or
      right to repurchase the Mortgage Loan or substitute another Mortgage Loan,
except as provided in this Agreement;                               

           (14) Doing Business. 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
    (2) either (i) organized under the laws of such state, or (ii) qualified
to do business in such state, or (iii) a federal savings and loan   
    association, a savings bank or a national bank having a principal office
in such state, or (3) not doing business in such state;             

           (15) LTV. No First Lien Mortgage Loan has an LTV greater than 100%,
and no Second Lien Mortgage Loan has an CLTV greater than 100%;     

     (16) Title Insurance. The Mortgage Loan is covered by an ALTA
     lender's title insurance policy, or with respect to any Mortgage Loan for
which the related Mortgaged Property is located in California a CLTA
  lender's title insurance policy, or other generally acceptable form of
    policy or insurance acceptable to Fannie Mae or Freddie Mac with respect
 to Mortgage Loans and each such title insurance policy is issued by a
     title insurer acceptable to Fannie Mae or Freddie Mac and qualified to do
 business in the jurisdiction where the Mortgaged Property is located,
     insuring New Century Mortgage Corporation, its successors and assigns, as
      to the first priority lien (with respect to a First Lien Mortgage Loan) or
     the second priority lien (with respect to a Second Lien Mortgage Loan) of
the Mortgage in the original principal amount of the Mortgage Loan, 
    subject only to the exceptions contained in clauses (i), (ii), (iii) and
(iv) of representation 10 of this Schedule III, and in the case of  
Adjustable Rate Mortgage Loans, against any loss by reason of the   
    invalidity or unenforceability of the lien resulting from the provisions
of the Mortgage providing for adjustment to the Mortgage Rate and   
Scheduled Payment. Where required by state law or regulation, the   
 Mortgagor has been given the opportunity to choose the carrier of the
required mortgage title insurance. Additionally, such lender's title
  insurance policy affirmatively insures ingress and egress, and against
    encroachments by or upon the Mortgaged Property or any interest therein.
    NC Capital Corporation, its successor and assigns, are the sole insureds
      of such lender's title insurance policy, and such lender's title insurance
     policy is valid and remains 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 related Mortgage, including New Century
Mortgage Corporation and NC Capital Corporation, has done, by act or
     omission, anything which would impair the coverage of such lender's title
insurance policy, including, without limitation, 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 New Century Mortgage Corporation or NC Capital
Corporation;                                                        

        (17) No Defaults. Other than payments due but not yet 30 or more
  days delinquent, there is no default, breach, violation or event which
      would permit acceleration existing under the Mortgage or the Mortgage Note
and no event which, 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 which would permit acceleration, and neither NC
Capital Corporation nor its Affiliates or any of their respective   
  predecessors have waived any default, breach, violation or event which
would permit acceleration;                                          

          (18) No Mechanics' Liens. As of the date of origination, 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 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;                                                   

         (19) Location of Improvements; No Encroachments. 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;                                                  

         (20) Origination; Payment Terms. Either (a) 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, or (b) the following  
    requirements have been met with respect to the Mortgage Loan: NC Capital
Corporation purchased the Mortgage Loan from New Century Mortgage   
Corporation, its affiliate, that meets the requirements set forth in
      clause (a), and (i) such Mortgage Loan was underwritten in accordance with
standards established by New Century Mortgage Corporation, using    
  application forms and related credit documents approved by New Century
     Mortgage Corporation, (ii) New Century Mortgage Corporation approved each
   application and the related credit documents before a commitment by the
 correspondent was issued, and no such commitment was issued until New
     Century Mortgage Corporation agreed to fund such Mortgage Loan, (iii) the
    closing documents for such Mortgage Loan were prepared on forms approved
by New Century Mortgage Corporation and (iv) such Mortgage Loan was 
    actually funded by New Century Mortgage Corporation and was purchased by
New Century Mortgage Corporation at closing or soon thereafter. 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. Principal payments
   on the Mortgage Loan commenced no more than sixty days after funds were
   disbursed in connection with the Mortgage Loan. The Mortgage Rate is as
set forth on Mortgage Loan Schedule hereto (including in the case of
     Adjustable Rate Mortgage Loans, the interest rate and payment limitations
    set forth on Mortgage Loan Schedule hereto). All Mortgage Loans have Due
    Dates on the first day of each month except as specified on the Mortgage
      Loan Schedule. Each Mortgage Note is payable in equal monthly installments
      of principal and interest, which installments of interest, with respect to
Adjustable Rate Mortgage Loans, are subject to change due to the    
   adjustments to the Mortgage Rate on each Interest Rate Adjustment Date,
      with interest calculated and payable in arrears and is not calculated on a
  simple interest basis. The monthly principal payments on each Mortgage
Loan is sufficient to amortize the Mortgage Loan fully by the stated
   maturity date, over an original term of not more than thirty years from
      commencement of amortization. There is no negative amortization allowed in
 the terms of any Mortgage Note. None of the Mortgage Loans allows for
     negative amortization or the conversion of the interest rate thereon from
    an adjustable rate to a fixed rate or from a fixed rate to an adjustable
rate. No Mortgage Loan is a Balloon Loan;                           

      (21) 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. Upon default by a Mortgagor on a
 Mortgage Loan and foreclosure on, or trustee's sale of, the Mortgaged
  Property pursuant to the proper procedures, the holder of the Mortgage
     Loan will be able to deliver good and merchantable title to the Mortgaged
Property. 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,
    subject to applicable federal and state laws and judicial precedent with
respect to bankruptcy and right of redemption or similar law;       

       (22) Index. With respect to Adjustable Rate Mortgage Loans, the
Index set forth in the Mortgage Note is LIBOR;                      

          (23) Occupancy of the Mortgaged Property. As of the Securitization
     Closing Date the Mortgaged Property is lawfully occupied under applicable
  law. All inspections, licenses and certificates required to be made or
  issued with respect to all occupied portions of the Mortgaged Property
      and, with respect to the use and occupancy of the same, including, but not
     limited to, certificates of occupancy and fire underwriting certificates,
have been made or obtained from the appropriate authorities;        

           (24) No Additional Collateral. The Mortgage Note is not and has not
been secured by any collateral except the lien of the corresponding 
      Mortgage and the security interest of any applicable security agreement or
chattel mortgage;                                                   

            (25) Deeds of Trust. In the event the Mortgage constitutes a deed of
   trust, a trustee, authorized and 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 Sponsor to the trustee under the deed of trust, except in    
connection with a trustee's sale after default by the Mortgagor;    

   (26) Delivery of Mortgage Documents. The Mortgage Note, the
    Mortgage, the Assignment of Mortgage and any other documents required to
be delivered under this Agreement for each Mortgage Loan have been  
delivered to the Sponsor;                                           

         (27) Transfer of Mortgage Loans. The Assignment of Mortgage is in
     recordable form, other than the assignee's name and recording information
not yet returned from the recording office, and is acceptable for   
recording under the laws of the jurisdiction in which the Mortgaged 
Property is located. The transfer, assignment and conveyance of the 
      Mortgage Notes and the Mortgages by NC Capital Corporation are not subject
 to the bulk transfer or similar statutory provisions in effect in any
applicable jurisdiction;                                            

            (28) due-on-sale. With respect to each Fixed Rate Mortgage Loan, the
  Mortgage contains an enforceable provision for the acceleration of the
     payment of the unpaid principal balance of the Mortgage Loan in the event
that the Mortgaged Property is sold or transferred without the prior
written consent of the mortgagee thereunder, and such provision is  
enforceable;                                                        

      (29) No Buydown Provisions No Graduated Payments or Contingent
      Interests. The Mortgage Loan does not contain provisions pursuant to which
     Scheduled Payments are paid or partially paid with funds deposited in any
     separate account established by NC Capital Corporation, the Mortgagor, or
   anyone on behalf of the Mortgagor, or paid by any source other than the
Mortgagor nor does it contain any other similar provisions which may
  constitute a "buydown" provision. The Mortgage Loan is not a graduated
payment mortgage loan and the Mortgage Loan does not have a shared  
appreciation or other contingent interest feature;                  

        (30) Assumability. With respect to each Adjustable Rate Mortgage
  Loan, the Mortgage Loan Documents provide that after the related first
      Interest Rate Adjustment Date, a related Mortgage Loan may only be assumed
      if the party assuming such Mortgage Loan meets certain credit requirements
stated in the Mortgage Loan Documents;                              

          (31) Consolidation of Future Advances. Any future advances made to
   the Mortgagor prior to the Cut-off Date have been consolidated with the
 outstanding principal amount secured by the Mortgage, and the secured
      principal amount, as consolidated, bears a single interest rate and single
repayment term. The lien of the Mortgage securing the consolidated  
     principal amount is expressly insured as having first lien priority (with
respect to a First Lien Mortgage Loan) or second lien priority (with
   respect to a Second Lien Mortgage Loan) by a title insurance policy, an
    endorsement to the policy insuring the mortgagee's consolidated interest
    or by other title evidence acceptable to Fannie Mae and Freddie Mac. The
consolidated principal amount does not exceed the original principal
amount of the Mortgage Loan;                                        

       (32) Mortgaged Property Undamaged; No Condemnation Proceedings.
 There is no proceeding pending or threatened for the total or partial
condemnation of the Mortgaged Property. The Mortgaged Property is   
     undamaged by waste, fire, earthquake or earth movement, windstorm, flood,
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 and each Mortgaged Property is in good repair.
There have not been any condemnation proceedings with respect to the
      Mortgaged Property and NC Capital Corporation has no knowledge of any such
proceedings in the future;                                          

 (33) Collection Practices; Escrow Payments; Interest Rate
    Adjustments. The origination, servicing and collection practices used by
  NC Capital Corporation and its Affiliates with respect to the Mortgage
Loan have been in all respects in compliance with Accepted Servicing
     Practices, applicable laws and regulations, and have been in all respects
     legal and proper. With respect to escrow deposits and Escrow Payments, if
     any, all such payments are in the possession of, or under the control of,
NC Capital Corporation and there exist no deficiencies in connection
     therewith for which customary arrangements for repayment thereof have not
      been made. All Escrow Payments have been collected in full compliance with
     state and federal law and the provisions of the related Mortgage Note and
    Mortgage. An escrow of funds is not prohibited by applicable law and has
been established in an amount sufficient 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 NC
Capital Corporation have been capitalized under the Mortgage or the 
 Mortgage Note. All Mortgage Rate adjustments have been made in strict
compliance with state and federal law and the terms of the related  
  Mortgage Note. If, pursuant to the terms of the Mortgage Note, another
    index was selected for determining the Mortgage Rate, the same index was
    used with respect to each Mortgage Note which required a new index to be
selected, and such selection did not conflict with the terms of the 
      related Mortgage Note. NC Capital Corporation or an Affiliate executed and
     delivered any and all notices required under applicable law and the terms
     of the related Mortgage Note and Mortgage regarding the Mortgage Rate and
      the monthly payment adjustments. Any interest required to be paid pursuant
to state, federal and local law has been properly paid and credited;

       (34) Other Insurance Policies. No action, inaction or event has
     occurred and no state of facts exists or has existed that has resulted or
      will result in the exclusion from, denial of, or defense to coverage under
  any insurance policy or bankruptcy bond related to the Mortgage Loans,
     irrespective of the cause of such failure of coverage. In connection with
the placement of any such insurance, no commission, fee, or other   
     compensation has been or will be received by NC Capital Corporation or by
any officer, director, or employee of NC Capital Corporation or any 
     designee of NC Capital Corporation or any corporation in which NC Capital
      Corporation or any officer, director, or employee had a financial interest
at the time of placement of such insurance;                         

           (35) No Violation of Environmental Laws. There is no pending action
or proceeding directly involving the Mortgaged Property in which    
  compliance with any environmental law, rule or regulation is an issue;
   there is no violation of any environmental law, rule or regulation with
     respect to the Mortgaged Property; and nothing further remains to be done
    to satisfy in full all requirements of each such law, rule or regulation
constituting a prerequisite to use and enjoyment of said property;  

            (36) Servicemembers Civil Relief Act. The Mortgagor has not notified
      NC Capital Corporation, and NC Capital Corporation has no knowledge of any
 relief requested or allowed to the Mortgagor under the Servicemembers
Civil Relief Act or any similar state statutes;                     

      (37) Appraisal. The Mortgage File contains an appraisal of the
     related Mortgaged Property signed by a qualified appraiser, acceptable to
  NC Capital Corporation, 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 appraiser both satisfy the     
   requirements of Fannie Mae or Freddie Mac and Title XI of the Financial
Institutions Reform, Recovery, and Enforcement Act of 1989 and the  
regulations promulgated thereunder, all as in effect on the date the
Mortgage Loan was originated;                                       

            (38) Disclosure Materials. The Mortgagor has executed a statement to
the effect that the Mortgagor has received all disclosure materials 
     required by, and the originator has complied with all applicable law with
respect to the making of the Mortgage Loans;                        

     (39) Construction or Rehabilitation of Mortgaged Property. No
Mortgage Loan was made in connection with the construction or       
  rehabilitation of a Mortgaged Property or facilitating the trade-in or
exchange of a Mortgaged Property;                                   

       (40) Value of Mortgaged Property. NC Capital Corporation has no
     knowledge of any circumstances existing that could reasonably be expected
to adversely affect the value or the marketability of any Mortgaged 
     Property or Mortgage Loan or to cause the Mortgage Loans to prepay during
      any period materially faster or slower than similar mortgage loans held by
NC Capital Corporation generally secured by properties in the same  
geographic area as the related Mortgaged Property;                  

          (41) No Defense to Insurance Coverage. No action has been taken or
     failed to be taken, no event has occurred and no state of facts exists or
      has existed on or prior to the Securitization Closing Date (whether or not
known to NC Capital Corporation on or prior to such date) which has 
  resulted or will result in an exclusion from, denial of, or defense to
coverage under any primary mortgage insurance (including, without   
limitation, any exclusions, denials or defenses which would limit or
   reduce the availability of the timely payment of the full amount of the
loss otherwise due thereunder to the insured) whether arising out of
   actions, representations, errors, omissions, negligence, or fraud of NC
   Capital Corporation, the related Mortgagor or any party involved in the
application for such coverage, including the appraisal, plans and   
     specifications and other exhibits or documents submitted therewith to the
   insurer under such insurance policy, or for any other reason under such
    coverage, but not including the failure of such insurer to pay by reason
of such insurer's breach of such insurance policy or such insurer's 
financial inability to pay;                                         

       (42) Escrow Analysis. With respect to each Mortgage, NC Capital
  Corporation or its Affiliate has within the last twelve months (unless
      such Mortgage was originated within such twelve month period) analyzed the
      required Escrow Payments for each Mortgage and adjusted the amount of such
 payments so that, assuming all required payments are timely made, any
    deficiency will be eliminated on or before the first anniversary of such
     analysis, or any overage will be refunded to the Mortgagor, in accordance
with RESPA and any other applicable law;                            

         (43) Prior Servicing. Each Mortgage Loan has been serviced in all
     material respects in strict compliance with Accepted Servicing Practices;

          (44) Credit Information. As to each consumer report (as defined in
the Fair Credit Reporting Act, Public Law 91-508) or other credit   
information furnished by NC Capital Corporation to the Sponsor, that
Seller has full right and authority and is not precluded by law or  
contract from furnishing such information to the Sponsor;           

       (45) Leaseholds. If the Mortgage Loan is secured by a long-term
residential lease, (1) the lessor under the lease holds a fee simple
  interest in the land; (2) the terms of such lease expressly permit the
   mortgaging of the leasehold estate, the assignment of the lease without
     the lessor's consent and the acquisition by the holder of the Mortgage of
the rights of the lessee upon foreclosure or assignment in lieu of  
foreclosure or provide the holder of the Mortgage with substantially
 similar protections; (3) the terms of such lease do not (a) allow the
   termination thereof upon the lessee's default without the holder of the
    Mortgage being entitled to receive written notice of, and opportunity to
      cure, such default, (b) allow the termination of the lease in the event of
damage or destruction as long as the Mortgage is in existence, (c)  
prohibit the holder of the Mortgage from being insured (or receiving
proceeds of insurance) under the hazard insurance policy or policies
 relating to the Mortgaged Property or (d) permit any increase in rent
other than pre-established increases set forth in the lease; (4) the
  original term of such lease is not less than 15 years; (5) the term of
    such lease does not terminate earlier than five years after the maturity
     date of the Mortgage Note; and (6) the Mortgaged Property is located in a
jurisdiction in which the use of leasehold estates in transferring  
 ownership in residential properties is a generally accepted practice;

        (46) Predatory Lending Regulations; High Cost Loans. None of the
     Mortgage Loans (a) is covered by the Home Ownership and Equity Protection
Act of 1994 or (b) is classified as a "high cost home," "threshold,"
      "covered" (excluding a "covered home loan" as defined in clause (1) of the
    definition of such term under the New Jersey Home Ownership Security Act
   of 2002), "high risk home", "predatory" or similar loan under any other
    applicable federal, state or local law (including without limitation any
    regulation or ordinance) (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) a Mortgage Loan categorized as
    "High Cost" or "Covered" pursuant to Appendix E of the Standard & Poor's
 Glossary, and no Mortgage Loan originated on or after October 1, 2002
through March 6, 2003 is governed by the Georgia Fair Lending Act;  

          (47) Prepayment Penalty. No Mortgage Loan has a prepayment penalty
   period in excess of three years. Any prepayment penalty is in an amount
    equal to the lesser of (a) the maximum amount permitted under applicable
  state law, and (b) if the Mortgaged Property is secured by residential
      real property located in a state other than Arizona, Maine, Massachusetts,
     New York, South Carolina or Wisconsin, six months interest on the related
prepaid amount;                                                     

    (48) Conformance with Agency and Underwriting Standards. The
Mortgage Loan was underwritten in accordance with the Underwriting  
 Guidelines. The Mortgage Note and Mortgage are on forms acceptable to
Freddie Mac or Fannie Mae and neither NC Capital Corporation nor any
Affiliate has made any representations to a Mortgagor that are      
inconsistent with the mortgage instruments used;                    

            (49) 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;                                                             

            (50) Acceptable Investment. There are no circumstances or conditions
    with respect to the Mortgage, the Mortgaged Property, the Mortgagor, the
   Mortgage File or the Mortgagor's credit standing that can reasonably be
    expected to cause private institutional investors who invest in mortgage
loans similar to the Mortgage Loan to regard the Mortgage Loan as an
     unacceptable investment, cause the Mortgage Loan to become delinquent, or
      adversely affect the value or marketability of the Mortgage Loan, or cause
      the Mortgage Loans to prepay during any period materially faster or slower
than the mortgage loans originated by NC Capital Corporation or any 
Affiliates generally;                                               

     (51) Condominiums/Planned Unit Developments. If the Mortgaged
      Property is a condominium unit or a planned unit development (other than a
 de minimis planned unit development) such condominium or planned unit
     development project such Mortgage Loan was originated in accordance with,
and the Mortgaged Property meets the guidelines set forth in the    
Originator's Underwriting Guidelines;                               

    (52) Conversion to Fixed Interest Rate. With respect to each
 Adjustable Rate Mortgage Loan, the Mortgage Loan is not a Convertible
Mortgage Loan;                                                      

            (53) Qualified Mortgage. The Mortgage Loan is a "qualified mortgage"
within the meaning of Section 860G(a)(3) of the Code;               

   (54) Compliance with Anti-Money Laundering Laws. NC Capital
   Corporation or an Affiliate has complied with all applicable anti-money
   laundering laws and regulations, including, without limitation, the USA
Patriot Act of 2001;                                                

    (55) Fair Credit Reporting Act. NC Capital Corporation or an
    Affiliate has, in its capacity as prior 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;                                  

       (56) Fannie Mae Guides Anti-Predatory Lending Eligibility. Each
      Mortgage Loan is in compliance with the anti-predatory lending eligibility
for purchase requirements of Fannie Mae Guides;                     

            (57) Mortgagor Selection. No Mortgagor was encouraged or required to
      select a Mortgage Loan product offered by the Originator which is a higher
      cost product designed for less creditworthy mortgagors, unless at the time
     of the Mortgage Loan's origination, such Mortgagor did not qualify taking
  into account credit history and debt-to-income ratios for a lower-cost
 credit product then offered by the Originator or any Affiliate of the
   Originator. If, at the time of loan application, the Mortgagor may have
  qualified for a lower-cost credit product then offered by any mortgage
    lending Affiliate of the Originator, the Originator referred the related
     Mortgagor's application to such Affiliate for underwriting consideration;

           (58) Underwriting Methodology. The methodology used in underwriting
the extension of credit for each Mortgage Loan employs objective    
mathematical principles which relate the related Mortgagor's income,
assets and liabilities to the proposed payment and such underwriting
     methodology does not rely on the extent of the related Mortgagor's equity
   in the collateral as the principal determining factor in approving such
      credit extension. Such underwriting methodology confirmed that at the time
of origination (application/approval) the related Mortgagor had a   
reasonable ability to make timely payments on the Mortgage Loan;    

         (59) Mortgage Loans with Prepayment Premiums. 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 Mortgage Loan's
     origination, the related 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 Mortgage Loan's origination, the related 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 related Mortgagor in the Mortgage Loan documents pursuant to    
   applicable state and federal law, and (iv) notwithstanding any state or
      federal law to the contrary, the Originator, as servicer, shall not impose
such prepayment premium in any instance when the mortgage debt is   
      accelerated as the result of the related Mortgagor's default in making the
Mortgage Loan payments;                                             

         (60) Purchase of Insurance. No Mortgagor was required to purchase
  any credit life, disability, accident or health insurance product as a
   condition of obtaining the extension of credit. No Mortgagor obtained a
prepaid single-premium credit life, disability, accident or health  
     insurance policy in connection with the origination of the Mortgage Loan.
   No proceeds from any Mortgage Loan were used to purchase single premium
      credit insurance policies as part of the origination of, or as a condition
to closing, such Mortgage Loan;                                     

          (61) 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 Fannie Mae's anti-predatory lending
requirements as set forth in the Fannie Mae Guides;                 

            (62) Disclosure of Fees and Charges. All fees and charges (including
   finance charges), whether or not financed, assessed, collected or to be
collected in connection with the origination and servicing of each  
Mortgage Loan, have been disclosed in writing to the Mortgagor in   
accordance with applicable state and federal law and regulation; and

            (63) No Arbitration. No Mortgage Loan originated on or after July 1,
   2004 requires the related Mortgagor to submit to arbitration to resolve
  any dispute arising out of or relating in any way to the Mortgage Loan
transaction.                                                        

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 SCHEDULE IV

 Morgan Stanley ABS Capital Inc.
 Mortgage Pass-Through Certificates,
 Series 2006-NC1

Representations and Warranties as to the Responsible Party

   NC Capital Corporation hereby makes the representations and
warranties set forth in this Schedule IV to the Depositor and the Trustee, as of
the Closing Date:                                                               

(a)   Due Organization and Authority. The Responsible Party is a    
         corporation duly organized, validly existing and in good standing
      under the laws of the state of California and has all licenses
        necessary to carry on its business as now being conducted and is
         licensed, qualified and in good standing in each state wherein it
            owns or leases any material properties or 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 Responsible Party, and in any event the Responsible Party is in
           compliance with the laws of any such state to the extent necessary;
         the Responsible Party has the full corporate power, authority and
            legal right to execute and deliver this Agreement and to perform its
         obligations hereunder; the execution, delivery and performance of
           this Agreement by the Responsible Party 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 Responsible Party,
           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 Responsible Party to make this Agreement and all agreements
           contemplated hereby valid and binding upon the Responsible Party in
accordance with their terms;                            

     (b)   No Conflicts. Neither the execution and delivery of this Agreement,
         the consummation of 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, conditions or provisions of the Responsible Party's charter
          or by-laws or any legal restriction or any agreement or instrument
       to which the Responsible Party is now a party or by which it is
         bound, or constitute a default or result in an acceleration under
          any of the foregoing, or result in the violation of any law, rule,
            regulation, order, judgment or decree to which the Responsible Party
           or its property is subject, or result in the creation or imposition
            of any lien, charge or encumbrance that would have an adverse effect
         upon any of its properties pursuant to the terms of any mortgage,
contract, deed of trust or other instrument;            

(c)   No Litigation Pending. There is no action, suit, proceeding or
          investigation pending or threatened against the Responsible Party,
           before any court, administrative agency or other tribunal asserting
the invalidity of this Agreement, seeking to prevent the
    consummation of any of the transactions contemplated by this
           Agreement or 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
        Responsible Party, or in any material impairment of the right or
 ability of the Responsible Party to carry on its business
           substantially as now conducted, or in any material liability on the
            part of the Responsible Party, or which would draw into question the
           validity of this Agreement or of any action taken or to be taken in
connection with the obligations of the Responsible Party
          contemplated herein, or which would be likely to impair materially
          the ability of the Responsible Party to perform under the terms of
this Agreement; and                                     

   (d)   No Consent Required. No consent, approval, authorization or order
     of, or registration or filing with, or notice to any court or
       governmental agency or body including HUD, the FHA or the VA is
   required for the execution, delivery and performance by the
        Responsible Party of or compliance by the Responsible Party with
           this Agreement or the consummation of the transactions contemplated
          by this Agreement, or if required, such approval has been obtained
prior to the Closing Date.                              

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SCHEDULE V

 Morgan Stanley ABS Capital I Inc.
Mortgage Pass-Through Certificates
 Series 2006-NC1

 Representations and Warranties of Morgan Stanley ABS Capital I Inc. as to the
Mortgage Loans

      The Depositor hereby makes with respect the Mortgage Loans the
following representations and warranties to the Trustee, as of the Closing Date:

          (1) Immediately prior to the transfer of the Mortgage Loans by the
    Depositor to the Trust on the Closing Date, the Depositor had good title
  to the Mortgage Loans, free and clear of any liens, charges, claims or
encumbrances whatsoever;                                            

      (2) The original loan balance of each Mortgage Loan was within
     Freddie Mac's and Fannie Mae's dollar amount limits for conforming one to
four family mortgage loans; and                                     

        (3) No Mortgage Loan has a Prepayment Charge period in excess of
three years.                                                        

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 SCHEDULE VI

 Morgan Stanley ABS Capital I Inc.
 Mortgage Pass Through Certificates,
 Series 2006-1

 Representations and Warranties of JPMorgan, as Servicer

          JPMorgan hereby makes the representations and warranties set forth
in this Schedule VI to the Depositor and the Trustee, as of the Closing Date.   
Capitalized terms used but not otherwise defined in this Agreement shall have   
the meanings ascribed thereto in the Agreement to which this Schedule IV is     
attached.                                                                       

      (1) JPMorgan is a national banking association duly organized,
      validly existing and in good standing under the federal laws of the United
      States of America and is duly authorized and qualified to transact any and
   all business contemplated by this Pooling and Servicing Agreement to be
     conducted by JPMorgan in any state in which a Mortgaged Property securing
a Mortgage Loan serviced by JPMorgan is located or is otherwise not 
  required under applicable law to effect such qualification and, in any
      event, is in compliance with the doing business laws of any such State, to
    the extent necessary to ensure its ability to enforce each Mortgage Loan
serviced by JPMorgan and to service each Mortgage Loan serviced by  
JPMorgan in accordance with the terms of this Pooling and Servicing 
Agreement;                                                          

     (2) JPMorgan has the full power and authority to service each
    Mortgage Loan serviced by JPMorgan, and to execute, deliver and perform,
  and to enter into and consummate the transactions contemplated by this
    Pooling and Servicing Agreement and has duly authorized by all necessary
     action on the part of JPMorgan the execution, delivery and performance of
this Pooling and Servicing Agreement; and this Pooling and Servicing
     Agreement, assuming the due authorization, execution and delivery thereof
by the Depositor, the Responsible Party, the other Servicer and the 
   Trustee, constitutes a legal, valid and binding obligation of JPMorgan,
    enforceable against JPMorgan in accordance with its terms, except to the
    extent that (a) the enforceability thereof may be limited by bankruptcy,
   insolvency, moratorium, receivership and other similar laws relating to
      creditors' rights generally and (b) the remedy of specific performance and
injunctive and other forms of equitable relief may be subject to the
  equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought;                                 

    (3) The execution and delivery of this Pooling and Servicing
  Agreement by JPMorgan, the servicing of the Mortgage Loans serviced by
     JPMorgan by JPMorgan hereunder, the consummation by JPMorgan of any other
of the transactions herein contemplated, and the fulfillment of or  
      compliance with the terms hereof are in the ordinary course of business of
    JPMorgan and will not (A) result in a breach of any term or provision of
      the organizational documents of JPMorgan or (B) conflict with, result in a
   breach, violation or acceleration of, or result in a default under, the
      terms of any other material agreement or instrument to which JPMorgan is a
  party or by which it may be bound, or any statute, order or regulation
applicable to JPMorgan of any court, regulatory body, administrative
agency or governmental body having jurisdiction over JPMorgan; and  
  JPMorgan is not a party to, bound by, or in breach or violation of any
     indenture or other agreement or instrument, or subject to or in violation
of any statute, order or regulation of any court, regulatory body,  
   administrative agency or governmental body having jurisdiction over it,
     which materially and adversely affects or, to JPMorgan's knowledge, would
      in the future materially and adversely affect, (x) the ability of JPMorgan
    to perform its obligations under this Pooling and Servicing Agreement or
      (y) the business, operations, financial condition, properties or assets of
JPMorgan taken as a whole;                                          

      (4) JPMorgan is an approved seller/servicer for Fannie Mae, an
    approved servicer for Freddie Mac in good standing and is a HUD approved
non supervised mortgagee;                                           

           (5) No litigation is pending against JPMorgan that would materially
  and adversely affect the execution, delivery or enforceability of this
     Pooling and Servicing Agreement or the ability of JPMorgan to service the
Mortgage Loans serviced by JPMorgan or to perform any of its other  
obligations hereunder in accordance with the terms hereof;          

        (6) No consent, approval, authorization or order of any court or
   governmental agency or body is required for the execution, delivery and
    performance by JPMorgan of, or compliance by JPMorgan with, this Pooling
and Servicing Agreement or the consummation by JPMorgan of the      
     transactions contemplated by this Pooling and Servicing Agreement, except
     for such consents, approvals, authorizations or orders, if any, that have
been obtained prior to the Closing Date;                            

   (7) JPMorgan has the facilities, procedures and experienced
     personnel necessary for the sound servicing of mortgage loans of the same
type as the Mortgage Loans serviced by JPMorgan; and                

           (8) With respect to each Mortgage Loan serviced by JPMorgan, to the
   extent JPMorgan serviced such Mortgage Loan serviced by JPMorgan and to
the extent JPMorgan provided monthly reports to the three credit    
   repositories, JPMorgan has fully furnished, in accordance with the Fair
Credit Reporting Act and its implementing regulations, accurate and 
  complete information (i.e., 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.     

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 EXHIBIT A

Unless this Certificate is presented by an authorized representative of the     
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its agent
for registration of transfer, exchange, or payment, and any certificate issued  
is registered in the name of Cede & Co. or in such other name as is requested by
an authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY  
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.                                                                         

SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN     
INTEREST IN A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT,"
AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE      
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), AND CERTAIN OTHER       
ASSETS.                                                                         

AS LONG AS THE INTEREST RATE SWAP AGREEMENT IS IN EFFECT, EACH BENEFICIAL OWNER 
OF THIS CERTIFICATE, OR ANY INTEREST THEREIN, SHALL BE DEEMED TO HAVE           
REPRESENTED THAT EITHER (I) IT IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT   
SUBJECT TO SECTION 406 OF ERISA, A PLAN SUBJECT TO SECTION 4975 OF THE CODE OR A
PLAN SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") MATERIALLY      
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE, NOR A PERSON ACTING ON
BEHALF OF ANY SUCH PLAN OR ARRANGEMENT NOR USING THE ASSETS OF ANY SUCH PLAN OR 
ARRANGEMENT OR (II) THE ACQUISITION AND HOLDING OF THIS CERTIFICATE ARE ELIGIBLE
FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER AT LEAST ONE OF PROHIBITED TRANSACTION 
CLASS EXEMPTION ("PTCE") 84-14, PTCE 90-1, PTCE 91-8, PTCE 95-60 OR PTCE 96-23  
OR A COMPARABLE EXEMPTION AVAILABLE UNDER SIMILAR LAW.                          

Certificate No:                                       A-1-[  ]                  
                                    A-2-[  ]
                                    A-3-[  ]
                                    A-4-[  ]
                                    M-1-[  ]
                                    M-2-[  ]
                                    M-3-[  ]
                                    M-4-[  ]
                                    M-5-[  ]
                                    M-6-[  ]
                                    B-1-[  ]
                                    B-2-[  ]
                                    B-3-[  ]

Cut-off Date:                                         January 1, 2006           

First Distribution Date:                              February 27, 2006         

Initial Certificate Balance of this Certificate                                 
("Denomination"):                                     $[              ]         

Initial Certificate Balances of all Certificates of   A-1           $512,080,000
this Class:                                           A-2           $156,440,000
                                                      A-3           $217,370,000
                                                      A-4           $136,726,000
                                                      M-1            $44,067,000
                                                      M-2            $40,827,000
                                                      M-3            $23,977,000
                                                      M-4            $20,737,000
                                                      M-5            $20,737,000
                                                      M-6            $18,793,000
                                                      B-1            $18,145,000
                                                      B-2            $16,201,000
                                                      B-3            $13,609,000

CUSIP:                                                Class A-1 61744C XX 9     
                                                 Class A-2 61744C XY 7
                                                 Class A-3 61744C XZ 4
                                                 Class A-4 61744C YA 8
                                                 Class M-1 61744C YB 6
                                                 Class M-2 61744C YC 4
                                                 Class M-3 61744C YD 2
                                                 Class M-4 61744C YE 0
                                                 Class M-5 61744C YF 7
                                                 Class M-6 61744C YG 5
                                                 Class B-1 61744C YH 3
                                                  Class B-2 61744C YJ 97
                                                 Class B-3 61744C YK 6

ISIN:                                                 Class A-1 US61744CXX90    
                                                  Class A-2 US61744CXY73
                                                  Class A-3 US61744CXZ49
                                                  Class A-4 US61744CYA88
                                                  Class M-1 US61744CYB61
                                                  Class M-2 US61744CYC45
                                                  Class M-3 US61744CYD28
                                                  Class M-4 US61744CYE01
                                                  Class M-5 US61744CYF75
                                                  Class M-6 US61744CYG58
                                                  Class B-1 US61744CYH32
                                                  Class B-2 US61744CYJ97
                                                  Class B-3 US61744CYK60

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 MORGAN STANLEY ABS CAPITAL I INC.

Morgan Stanley ABS Capital I Inc. Trust 2006-NC1
 Mortgage Pass-Through Certificates, Series 2006-NC1
 [Class A-][Class M-][Class B]

          evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class.         

            Principal in respect of this Certificate is distributable monthly as
set forth herein. Accordingly, the Certificate Balance at any time may be less  
than the Certificate Balance as set forth herein. This Certificate does not     
evidence an obligation of, or an interest in, and is not guaranteed by the      
Depositor, the Trustee or any other party to the Agreement referred to below or 
any of their respective affiliates. Neither this Certificate nor the Mortgage   
Loans are guaranteed or insured by any governmental agency or instrumentality.  

        This certifies that _____________ is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the     
denomination of this Certificate by the aggregate of the denominations of all   
Certificates of the Class to which this Certificate belongs) in certain monthly 
distributions pursuant to a Pooling and Servicing Agreement dated as of the     
Cut-off Date specified above (the "Agreement") among Morgan Stanley ABS Capital 
I Inc., as depositor (the "Depositor"), HomEq Servicing Corporation, as         
servicer, NC Capital Corporation, JPMorgan Chase Bank, National Association, as 
a servicer, as responsible party, and Deutsche Bank National Trust Company, as  
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Agreement. This Certificate is    
issued under and is subject to the terms, provisions and conditions of the      
Agreement, to which Agreement the Holder of this Certificate by virtue of the   
acceptance hereof assents and by which such Holder is bound.                    

  Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for 
all purposes have the same effect as if set forth at this place.                

       This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually authenticated by an       
authorized signatory of the Trustee.                                            

 * * *

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         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.                                                                  

Dated:                                                                          

                                  DEUTSCHE BANK NATIONAL TRUST
                  COMPANY,
                                         not in its individual capacity,
                               but solely as Trustee

         By:
                                              ----------------------------------

Authenticated:                                                                  

By:                                                                             
-------------------------------------                                     
Authorized Signatory of                                                   
DEUTSCHE BANK NATIONAL TRUST COMPANY,                                     
not in its individual capacity,                                           
but solely as Trustee                                                     

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 MORGAN STANLEY ABS CAPITAL I INC.
Morgan Stanley ABS Capital I Inc. Trust 2006-NC1
Mortgage Pass-Through Certificates

          This Certificate is one of a duly authorized issue of Certificates
designated as Morgan Stanley ABS Capital I Inc. Trust 2006-NC1 Mortgage         
Pass-Through Certificates, of the Series specified on the face hereof (herein   
collectively called the "Certificates"), and representing a beneficial ownership
interest in the Trust Fund created by the Agreement.                            

            The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders  
for any amount payable under this Certificate or the Agreement or, except as    
expressly provided in the Agreement, subject to any liability under the         
Agreement.                                                                      

        This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of 
rights, benefits, obligations and duties evidenced thereby, and the rights,     
duties and immunities of the Trustee.                                           

           Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such day is not a Business Day, the        
Business Day, immediately following (the "Distribution Date"), commencing on the
first Distribution Date specified on the face hereof, to the Person in whose    
name this Certificate is registered at the close of business on the applicable  
Record Date in an amount equal to the product of the Percentage Interest        
evidenced by this Certificate and the amount required to be distributed to      
Holders of Certificates of the Class to which this Certificate belongs on such  
Distribution Date pursuant to the Agreement. The Record Date applicable to each 
Distribution Date is the Business Day immediately preceding such Distribution   
Date; provided, however, that for any Definitive Certificates, the Record Date  
shall be the last Business Day of the month next preceding the month of such    
Distribution Date.                                                              

           Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or    
other entity having appropriate facilities therefor, if such Certificateholder  
shall have so notified the Trustee in writing at least five Business Days prior 
to the related Record Date and such Certificateholder shall satisfy the         
conditions to receive such form of payment set forth in the Agreement, or, if   
not, by check mailed by first class mail to the address of such                 
Certificateholder appearing in the Certificate Register. The final distribution 
on each Certificate will be made in like manner, but only upon presentment and  
surrender of such Certificate at the offices designated by the Trustee for such 
purposes, or such other location specified in the notice to Certificateholders  
of such final distribution.                                                     

            The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the     
Trustee and the rights of the Certificateholders under the Agreement at any time
by the parties to the Agreement with the consent of the Holders of Certificates 
affected by such amendment evidencing the requisite Percentage Interest, as     
provided in the Agreement. Any such consent by the Holder of this Certificate   
shall be conclusive and binding on such Holder and upon all future Holders of   
this Certificate and of any Certificate issued upon the transfer hereof or in   
exchange therefor or in lieu hereof whether or not notation of such consent is  
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the 
Certificates.                                                                   

       As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the       
Certificate Register of the Trustee upon surrender of this Certificate for      
registration of transfer at the offices designated by the Trustee for such      
purposes, accompanied by a written instrument of transfer in form satisfactory  
to the Trustee duly executed by the holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same   
Class in authorized denominations and evidencing the same aggregate Percentage  
Interest in the Trust Fund will be issued to the designated transferee or       
transferees.                                                                    

     The Certificates are issuable only as registered Certificates
without coupons in denominations specified in the Agreement. As provided in the 
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations 
and evidencing the same aggregate Percentage Interest, as requested by the      
Holder surrendering the same.                                                   

            No service charge will be made for any such registration of transfer
or exchange, but the Trustee may require payment of a sum sufficient to cover   
any tax or other governmental charge payable in connection therewith.           

           The Depositor and the Trustee and any agent of the Depositor or the
Trustee may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and neither the Depositor, the Trustee, nor any  
such agent shall be affected by any notice to the contrary.                     

        On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Cut-off Date  
Pool Principal Balance, HomEq Servicing Corporation, will have the option to    
repurchase, in whole, from the Trust Fund all remaining Mortgage Loans and all  
property acquired in respect of the Mortgage Loans at a purchase price          
determined as provided in the Agreement. The obligations and responsibilities   
created by the Agreement will terminate as provided in Section 9.01 of the      
Agreement.                                                                      

            Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed           
inconsistent with that meaning.                                                 

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ASSIGNMENT
----------

FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)   
unto                                                                            

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

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

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

--------------------------------------------------------------------------------
(Please print or typewrite name and address including postal zip code of        
assignee)                                                                       

the Percentage Interest evidenced by the within Certificate and hereby          
authorizes the transfer of registration of such Percentage Interest to assignee 
on the Certificate Register of the Trust Fund.                                  

         I (We) further direct the Trustee to issue a new Certificate of a
like denomination and Class, to the above named assignee and deliver such       
Certificate to the following address: _________________________________________.

Dated:                                                                          

                                      ------------------------------------------
                                 Signature by or on behalf of assignor

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 DISTRIBUTION INSTRUCTIONS

 The assignee should include the following for purposes of
distribution:                                                                   

      Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ________________________________________________,
_______________________________________________________________________________,
for the account of ____________________________________________________________,
account number _______, or, if mailed by check, to ____________________________.
Applicable statements should be mailed to _____________________________________,
_______________________________________________________________________________.

            This information is provided by ___________________________________,
the assignee named above, or __________________________________________________,
as its agent.                                                                   

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 EXHIBIT B

NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE  
PROPOSED TRANSFEROR DELIVERS TO THE TRUSTEE A TRANSFEROR LETTER IN THE FORM OF  
EXHIBIT H TO THE AGREEMENT REFERRED TO HEREIN AND EITHER (I) THE TRUSTEE        
RECEIVES A RULE 144A LETTER IN THE FORM OF EXHIBIT I TO THE AGREEMENT REFERRED  
TO HEREIN OR (II) THE TRUSTEE RECEIVES AN OPINION OF COUNSEL, DELIVERED AT THE  
EXPENSE OF THE TRANSFEROR, THAT SUCH TRANSFER MAY BE MADE WITHOUT REGISTRATION  
UNDER THE SECURITIES ACT OF 1933, AS AMENDED.                                   

NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE  
TRANSFEREE DELIVERS TO THE TRUSTEE A REPRESENTATION LETTER TO THE EFFECT THAT   
SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE I OF THE       
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, ("ERISA"), OR A    
PLAN SUBJECT TO SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO MATERIALLY SIMILAR
PROVISIONS OF APPLICABLE FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") OR A PERSON
INVESTING ON BEHALF OF OR WITH PLAN ASSETS OF SUCH A PLAN. IN THE EVENT THAT    
SUCH REPRESENTATION IS VIOLATED, OR ANY ATTEMPT IS MADE TO TRANSFER TO A PLAN OR
ARRANGEMENT SUBJECT TO SECTION 406 OF ERISA, A PLAN SUBJECT TO SECTION 4975 OF  
THE CODE OR A PLAN SUBJECT TO SIMILAR LAW, OR A PERSON ACTING ON BEHALF OF ANY  
SUCH PLAN OR ARRANGEMENT OR USING THE ASSETS OF ANY SUCH PLAN OR ARRANGEMENT,   
SUCH ATTEMPTED TRANSFER OR ACQUISITION SHALL BE VOID AND OF NO EFFECT.          

Certificate No.                         : P-1                                   

Cut-off Date                            : January 1, 2006                       

First Distribution Date                 : February 27, 2006                     

Percentage Interest of this                                                     
Certificate ("Denomination")            : [___]%                                

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 MORGAN STANLEY ABS CAPITAL I INC.

Morgan Stanley ABS Capital I Inc. Trust 2006-NC1
 Mortgage Pass-Through Certificates, Series 2006-NC1

 Class P

          evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class.         

      Distributions in respect of this Certificate are distributable
monthly as set forth herein. This Certificate does not evidence an obligation   
of, or an interest in, and is not guaranteed by the Depositor, the Trustee or   
any other party to the Agreement referred to below or any of their respective   
affiliates. Neither this Certificate nor the Mortgage Loans are guaranteed or   
insured by any governmental agency or instrumentality.                          

          This certifies that _____________________, is the registered owner
of the Percentage Interest evidenced by this Certificate (obtained by dividing  
the denomination of this Certificate by the aggregate of the denominations of   
all Certificates of the Class to which this Certificate belongs) in certain     
monthly distributions pursuant to a Pooling and Servicing Agreement dated as of 
the Cut-off Date specified above (the "Agreement") among Morgan Stanley ABS     
Capital I Inc., as depositor (the "Depositor"), JPMorgan Chase Bank, National   
Association, as a servicer, HomEq Servicing Corporation, as servicer, NC Capital
Corporation, as responsible party, and Deutsche Bank National Trust Company, as 
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Agreement. This Certificate is    
issued under and is subject to the terms, provisions and conditions of the      
Agreement, to which Agreement the Holder of this Certificate by virtue of the   
acceptance hereof assents and by which such Holder is bound.                    

      This Certificate does not have a Pass-Through Rate and will be
entitled to distributions only to the extent set forth in the Agreement. In     
addition, any distribution of the proceeds of any remaining assets of the Trust 
will be made only upon presentment and surrender of this Certificate at the     
offices designated by the Trustee for such purposes, or such other location     
specified in the notice to Certificateholders.                                  

            No transfer of a Certificate of this Class shall be made unless such
disposition is exempt from the registration requirements of the Securities Act  
of 1933, as amended (the "Securities Act"), and any applicable state securities 
laws or is made in accordance with the Securities Act and such laws. In the     
event of any such transfer, the Trustee shall require the transferor to execute 
a transferor certificate (in substantially the form attached to the Pooling and 
Servicing Agreement) and deliver either (i) a Rule 144A Letter, in either case  
substantially in the form attached to the Agreement, or (ii) a written Opinion  
of Counsel to the Trustee that such transfer may be made pursuant to an         
exemption, describing the applicable exemption and the basis therefor, from the 
Securities Act or is being made pursuant to the Securities Act, which Opinion of
Counsel shall be an expense of the transferor.                                  

           No transfer of a Certificate of this Class shall be made unless the
Trustee shall have received a representation letter from the transferee of such 
Certificate, acceptable to and in form and substance satisfactory to the        
Trustee, to the effect that such transferee is not an employee benefit plan     
subject to Section 406 of ERISA, Section 4975 of the Code or any materially     
similar provisions of applicable federal, state or local law ("Similar Law"), or
a person acting on behalf of or investing plan assets of any such plan, which   
representation letter shall not be an expense of the Trustee.                   

  Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for 
all purposes have the same effect as if set forth at this place.                

       This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually authenticated by an       
authorized signatory of the Trustee.                                            

 * * *

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         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.                                                                  

Dated:                                                                          

                                  DEUTSCHE BANK NATIONAL TRUST
                  COMPANY,
                                         not in its individual capacity,
                               but solely as Trustee

         By:
                                              ----------------------------------

Authenticated:                                                                  

By:                                                                             
-------------------------------------                                     
Authorized Signatory of                                                   
DEUTSCHE BANK NATIONAL TRUST COMPANY,                                     
not in its individual capacity,                                           
but solely as Trustee                                                     

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 MORGAN STANLEY ABS CAPITAL I INC.
Morgan Stanley ABS Capital I Inc. Trust 2006-NC1
Mortgage Pass-Through Certificates

          This Certificate is one of a duly authorized issue of Certificates
designated as Morgan Stanley ABS Capital I Inc. Trust 2006-NC1 Mortgage         
Pass-Through Certificates, of the Series specified on the face hereof (herein   
collectively called the "Certificates"), and representing a beneficial ownership
interest in the Trust Fund created by the Agreement.                            

            The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders  
for any amount payable under this Certificate or the Agreement or, except as    
expressly provided in the Agreement, subject to any liability under the         
Agreement.                                                                      

        This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of 
rights, benefits, obligations and duties evidenced thereby, and the rights,     
duties and immunities of the Trustee.                                           

           Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the   
Business Day immediately following (the "Distribution Date"), commencing on the 
first Distribution Date specified on the face hereof, to the Person in whose    
name this Certificate is registered at the close of business on the applicable  
Record Date in an amount equal to the product of the Percentage Interest        
evidenced by this Certificate and the amount required to be distributed to      
Holders of Certificates of the Class to which this Certificate belongs on such  
Distribution Date pursuant to the Agreement. The Record Date applicable to each 
Distribution Date is the last Business Day of the month next preceding the month
of such Distribution Date.                                                      

           Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or    
other entity having appropriate facilities therefor, if such Certificateholder  
shall have so notified the Trustee in writing at least five Business Days prior 
to the related Record Date and such Certificateholder shall satisfy the         
conditions to receive such form of payment set forth in the Agreement, or, if   
not, by check mailed by first class mail to the address of such                 
Certificateholder appearing in the Certificate Register. The final distribution 
on each Certificate will be made in like manner, but only upon presentment and  
surrender of such Certificate at the offices designated by the Trustee for such 
purposes or such other location specified in the notice to Certificateholders of
such final distribution.                                                        

            The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the     
Trustee and the rights of the Certificateholders under the Agreement at any time
by the parties to the Agreement with the consent of the Holders of Certificates 
affected by such amendment evidencing the requisite Percentage Interest, as     
provided in the Agreement. Any such consent by the Holder of this Certificate   
shall be conclusive and binding on such Holder and upon all future Holders of   
this Certificate and of any Certificate issued upon the transfer hereof or in   
exchange therefor or in lieu hereof whether or not notation of such consent is  
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the 
Certificates.                                                                   

       As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the       
Certificate Register of the Trustee upon surrender of this Certificate for      
registration of transfer at the offices designated by the Trustee for such      
purposes, accompanied by a written instrument of transfer in form satisfactory  
to the Trustee duly executed by the holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same   
Class in authorized denominations and evidencing the same aggregate Percentage  
Interest in the Trust Fund will be issued to the designated transferee or       
transferees.                                                                    

     The Certificates are issuable only as registered Certificates
without coupons in denominations specified in the Agreement. As provided in the 
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations 
and evidencing the same aggregate Percentage Interest, as requested by the      
Holder surrendering the same.                                                   

            No service charge will be made for any such registration of transfer
or exchange, but the Trustee may require payment of a sum sufficient to cover   
any tax or other governmental charge payable in connection therewith.           

           The Depositor and the Trustee and any agent of the Depositor or the
Trustee may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and neither the Depositor, the Trustee, nor any  
such agent shall be affected by any notice to the contrary.                     

        On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Cut-off Date  
Pool Principal Balance, HomEq Servicing Corporation, will have the option to    
repurchase, in whole, from the Trust Fund all remaining Mortgage Loans and all  
property acquired in respect of the Mortgage Loans at a purchase price          
determined as provided in the Agreement. The obligations and responsibilities   
created by the Agreement will terminate as provided in Section 9.01 of the      
Agreement.                                                                      

            Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed           
inconsistent with that meaning.                                                 

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ASSIGNMENT
----------

FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)   
unto                                                                            

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

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

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

--------------------------------------------------------------------------------
(Please print or typewrite name and address including postal zip code of        
assignee)                                                                       

the Percentage Interest evidenced by the within Certificate and hereby          
authorizes the transfer of registration of such Percentage Interest to assignee 
on the Certificate Register of the Trust Fund.                                  

         I (We) further direct the Trustee to issue a new Certificate of a
like denomination and Class, to the above named assignee and deliver such       
Certificate to the following address: _________________________________________.

Dated:                                                                          

                                      ------------------------------------------
                                 Signature by or on behalf of assignor

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 DISTRIBUTION INSTRUCTIONS

 The assignee should include the following for purposes of
distribution:                                                                   

      Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ________________________________________________,
_______________________________________________________________________________,
for the account of ____________________________________________________________,
account number _______, or, if mailed by check, to ____________________________.
Applicable statements should be mailed to _____________________________________,
_______________________________________________________________________________.

            This information is provided by ___________________________________,
the assignee named above, or __________________________________________________,
as its agent.                                                                   

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 EXHIBIT C

SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL    
INTEREST" IN FOUR "REAL ESTATE MORTGAGE INVESTMENT CONDUITS," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE").                                                  

NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE  
PROPOSED TRANSFEREE DELIVERS TO THE TRUSTEE A TRANSFER AFFIDAVIT IN ACCORDANCE  
WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.                        

NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED (I) TO A    
PERSON OTHER THAN A PERMITTED TRANSFEREE IN COMPLIANCE WITH SECTION 5.02(C) OF  
THE AGREEMENT OR (II) UNLESS THE TRANSFEREE DELIVERS TO THE TRUSTEE A           
REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE     
BENEFIT PLAN SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT  
OF 1974, AS AMENDED ("ERISA"), OR A PLAN SUBJECT TO SECTION 4975 OF THE CODE OR 
A PLAN SUBJECT TO MATERIALLY SIMILAR PROVISIONS OF APPLICABLE FEDERAL, STATE OR 
LOCAL LAW ("SIMILAR LAW") OR A PERSON INVESTING ON BEHALF OF OR WITH PLAN ASSETS
OF SUCH A PLAN. IN THE EVENT THAT SUCH REPRESENTATION IS VIOLATED, OR ANY       
ATTEMPT IS MADE TO TRANSFER TO A PLAN OR ARRANGEMENT SUBJECT TO SECTION 406 OF  
ERISA, A PLAN SUBJECT TO SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO SIMILAR  
LAW, OR A PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR ARRANGEMENT OR USING THE  
ASSETS OF ANY SUCH PLAN OR ARRANGEMENT, SUCH ATTEMPTED TRANSFER OR ACQUISITION  
SHALL BE VOID AND OF NO EFFECT.                                                 

Certificate No.                         : R-1                                   
Cut-off Date                            : January 1, 2006                       
First Distribution Date                 : February 27, 2006                     
Percentage Interest of this                                                     
Certificate ("Denomination")            : 100%                                  

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 MORGAN STANLEY ABS CAPITAL I INC.

Morgan Stanley ABS Capital I Inc. Trust 2006-NC1
 Mortgage Pass-Through Certificates, Series 2006-NC1
 Class R

          evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class.         

     Distributions in respect of this Certificate is distributable
monthly as set forth herein. This Class R Certificate has no Certificate Balance
and is not entitled to distributions in respect of principal or interest. This  
Certificate does not evidence an obligation of, or an interest in, and is not   
guaranteed by the Depositor, the Trustee or any other party to the Agreement    
referred to below or any of their respective affiliates. Neither this           
Certificate nor the Mortgage Loans are guaranteed or insured by any governmental
agency or instrumentality.                                                      

          This certifies that ______________________ is the registered owner
of the Percentage Interest specified above of any monthly distributions due to  
the Class R Certificates pursuant to a Pooling and Servicing Agreement dated as 
of the Cut-off Date specified above (the "Agreement") among Morgan Stanley ABS  
Capital I Inc., as depositor (the "Depositor"), JPMorgan Chase Bank, National   
Association, as servicer, HomEq Servicing Corporation, as servicer, NC Capital  
Corporation, as responsible party, and Deutsche Bank National Trust Company, as 
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Agreement. This Certificate is    
issued under and is subject to the terms, provisions and conditions of the      
Agreement, to which Agreement the Holder of this Certificate by virtue of the   
acceptance hereof assents and by which such Holder is bound.                    

       Any distribution of the proceeds of any remaining assets of the
Trust Fund will be made only upon presentment and surrender of this Class R     
Certificate at the offices designated by the Trustee for such purposes or such  
other location specified in the notice to Certificateholders.                   

     No transfer of a Class R Certificate shall be made unless the
Trustee shall have received a representation letter from the transferee of such 
Certificate, acceptable to and in form and substance satisfactory to the        
Trustee, to the effect that such transferee is not an employee benefit plan or  
arrangement subject to Section 406 of ERISA, a plan or arrangement subject to   
Section 4975 of the Code or a plan subject to Similar Law, or a person acting on
behalf of any such plan or arrangement nor using the assets of any such plan or 
arrangement to effect such transfer, which representation letter shall not be an
expense of the Trustee, the Servicers or the Trust Fund. In the event that such 
representation is violated, or any attempt is made to transfer to a plan or     
arrangement subject to Section 406 of ERISA or a plan subject to Section 4975 of
the Code or a plan subject to Similar Law, or a person acting on behalf of any  
such plan or arrangement or using the assets of any such plan or arrangement,   
such attempted transfer or acquisition shall be void and of no effect.          

      Each Holder of this Class R Certificate shall be deemed by the
acceptance or acquisition an Ownership Interest in this Class R Certificate to  
have agreed to be bound by the following provisions, and the rights of each     
Person acquiring any Ownership Interest in this Class R Certificate are         
expressly subject to the following provisions: (i) each Person holding or       
acquiring any Ownership Interest in this Class R Certificate shall be a         
Permitted Transferee and shall promptly notify the Trustee of any change or     
impending change in its status as a Permitted Transferee, (ii) no Ownership     
Interest in this Class R Certificate may be registered on the Closing Date or   
thereafter transferred, and the Trustee shall not register the Transfer of this 
Certificate unless, in addition to the certificates required to be delivered to 
the Trustee under Section 5.02(b) of the Agreement, the Trustee shall have been 
furnished with a Transfer Affidavit of the initial owner or the proposed        
transferee in the form attached as Exhibit G to the Agreement, (iii) each Person
holding or acquiring any Ownership Interest in this Class R Certificate shall   
agree (A) to obtain a Transfer Affidavit from any other Person to whom such     
Person attempts to Transfer its Ownership Interest this Class R Certificate, (B)
to obtain a Transfer Affidavit from any Person for whom such Person is acting as
nominee, trustee or agent in connection with any Transfer of this Class R       
Certificate, (C) not to cause income with respect to the Class R Certificate to 
be attributable to a foreign permanent establishment or fixed base, within the  
meaning of an applicable income tax treaty, of such Person or any other U.S.    
Person and (D) not to Transfer the Ownership Interest in this Class R           
Certificate or to cause the Transfer of the Ownership Interest in this Class R  
Certificate to any other Person if it has actual knowledge that such Person is a
Non-Permitted Transferee and (iv) any attempted or purported Transfer of the    
Ownership Interest in this Class R Certificate in violation of the provisions   
herein shall be absolutely null and void and shall vest no rights in the        
purported Transferee.                                                           

  Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for 
all purposes have the same effect as if set forth at this place.                

       This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually authenticated by an       
authorized signatory of the Trustee.                                            

 * * *

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         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.                                                                  

Dated:                                                                          

                                  DEUTSCHE BANK NATIONAL TRUST
                  COMPANY,
                                         not in its individual capacity,
                               but solely as Trustee

         By:
                                              ----------------------------------

Authenticated:                                                                  

By:                                                                             
-------------------------------------                                     
Authorized Signatory of                                                   
DEUTSCHE BANK NATIONAL TRUST COMPANY,                                     
not in its individual capacity,                                           
but solely as Trustee                                                     

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Morgan Stanley ABS Capital I Inc. Trust 2006-NC1
Mortgage Pass-Through Certificates

          This Certificate is one of a duly authorized issue of Certificates
designated as Morgan Stanley ABS Capital I Inc. Trust 2006-NC1 Mortgage         
Pass-Through Certificates, of the Series specified on the face hereof (herein   
collectively called the "Certificates"), and representing a beneficial ownership
interest in the Trust Fund created by the Agreement.                            

            The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders  
for any amount payable under this Certificate or the Agreement or, except as    
expressly provided in the Agreement, subject to any liability under the         
Agreement.                                                                      

        This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of 
rights, benefits, obligations and duties evidenced thereby, and the rights,     
duties and immunities of the Trustee.                                           

           Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such day is not a Business Day, the        
Business Day immediately following (the "Distribution Date"), commencing on the 
first Distribution Date specified on the face hereof, to the Person in whose    
name this Certificate is registered at the close of business on the applicable  
Record Date in an amount equal to the product of the Percentage Interest        
evidenced by this Certificate and the amount required to be distributed to      
Holders of Certificates of the Class to which this Certificate belongs on such  
Distribution Date pursuant to the Agreement. The Record Date applicable to each 
Distribution Date is the last Business Day of the month next preceding the month
of such Distribution Date.                                                      

           Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or    
other entity having appropriate facilities therefor, if such Certificateholder  
shall have so notified the Trustee in writing at least five Business Days prior 
to the related Record Date and such Certificateholder shall satisfy the         
conditions to receive such form of payment set forth in the Agreement, or, if   
not, by check mailed by first class mail to the address of such                 
Certificateholder appearing in the Certificate Register. The final distribution 
on each Certificate will be made in like manner, but only upon presentment and  
surrender of such Certificate at the offices designated by the Trustee for such 
purposes or such other location specified in the notice to Certificateholders of
such final distribution.                                                        

            The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the     
Trustee and the rights of the Certificateholders under the Agreement at any time
by the parties to the Agreement with the consent of the Holders of Certificates 
affected by such amendment evidencing the requisite Percentage Interest, as     
provided in the Agreement. Any such consent by the Holder of this Certificate   
shall be conclusive and binding on such Holder and upon all future Holders of   
this Certificate and of any Certificate issued upon the transfer hereof or in   
exchange therefor or in lieu hereof whether or not notation of such consent is  
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the 
Certificates.                                                                   

       As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the       
Certificate Register of the Trustee upon surrender of this Certificate for      
registration of transfer at the offices designated by the Trustee for such      
purposes, accompanied by a written instrument of transfer in form satisfactory  
to the Trustee duly executed by the holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same   
Class in authorized denominations and evidencing the same aggregate Percentage  
Interest in the Trust Fund will be issued to the designated transferee or       
transferees.                                                                    

     The Certificates are issuable only as registered Certificates
without coupons in denominations specified in the Agreement. As provided in the 
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations 
and evidencing the same aggregate Percentage Interest, as requested by the      
Holder surrendering the same.                                                   

            No service charge will be made for any such registration of transfer
or exchange, but the Trustee may require payment of a sum sufficient to cover   
any tax or other governmental charge payable in connection therewith.           

           The Depositor and the Trustee and any agent of the Depositor or the
Trustee may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and neither the Depositor, the Trustee, nor any  
such agent shall be affected by any notice to the contrary.                     

        On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Cut-off Date  
Pool Principal Balance, HomEq Servicing Corporation, will have the option to    
repurchase, in whole, from the Trust Fund all remaining Mortgage Loans and all  
property acquired in respect of the Mortgage Loans at a purchase price          
determined as provided in the Agreement. The obligations and responsibilities   
created by the Agreement will terminate as provided in Section 9.01 of the      
Agreement.                                                                      

            Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed           
inconsistent with that meaning.                                                 

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ASSIGNMENT
----------

FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)   
unto                                                                            

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

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

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

--------------------------------------------------------------------------------
(Please print or typewrite name and address including postal zip code of        
assignee)                                                                       

the Percentage Interest evidenced by the within Certificate and hereby          
authorizes the transfer of registration of such Percentage Interest to assignee 
on the Certificate Register of the Trust Fund.                                  

         I (We) further direct the Trustee to issue a new Certificate of a
like denomination and Class, to the above named assignee and deliver such       
Certificate to the following address: _________________________________________.

Dated:                                                                          

                                      ------------------------------------------
                                 Signature by or on behalf of assignor

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 DISTRIBUTION INSTRUCTIONS

 The assignee should include the following for purposes of
distribution:                                                                   

      Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ________________________________________________,
_______________________________________________________________________________,
for the account of ____________________________________________________________,
account number _______, or, if mailed by check, to ____________________________.
Applicable statements should be mailed to _____________________________________,
_______________________________________________________________________________.

            This information is provided by ___________________________________,
the assignee named above, or __________________________________________________,
as its agent.                                                                   

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 EXHIBIT D

SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN     
INTEREST IN TWO "REGULAR INTERESTS" IN A "REAL ESTATE MORTGAGE INVESTMENT       
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), AND CERTAIN OTHER   
ASSETS.                                                                         

NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE  
PROPOSED TRANSFEROR DELIVERS TO THE TRUSTEE A TRANSFEROR LETTER IN THE FORM OF  
EXHIBIT H TO THE AGREEMENT REFERRED TO HEREIN AND EITHER (I) THE TRUSTEE        
RECEIVES A RULE 144A LETTER IN THE FORM OF EXHIBIT I TO THE AGREEMENT REFERRED  
TO HEREIN OR (II) THE TRUSTEE RECEIVES AN OPINION OF COUNSEL, DELIVERED AT THE  
EXPENSE OF THE TRANSFEROR, THAT SUCH TRANSFER MAY BE MADE WITHOUT REGISTRATION  
UNDER THE SECURITIES ACT OF 1933, AS AMENDED.                                   

NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE  
TRANSFEREE DELIVERS TO THE TRUSTEE EITHER A REPRESENTATION LETTER TO THE EFFECT 
THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE I OF THE  
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR A PLAN
SUBJECT TO SECTION 4975 OF THE CODE, OR A PLAN SUBJECT TO APPLICABLE FEDERAL,   
STATE OR LOCAL LAW ("SIMILAR LAW") MATERIALLY SIMILAR TO THE FOREGOING          
PROVISIONS OF ERISA OR THE CODE OR A PERSON INVESTING ON BEHALF OF OR WITH PLAN 
ASSETS OF SUCH A PLAN, OR, IF THE TRANSFEREE IS AN INSURANCE COMPANY, A         
REPRESENTATION LETTER THAT IT IS USING THE ASSETS OF ITS GENERAL ACCOUNT AND    
THAT THE PURCHASE AND HOLDING OF THIS CERTIFICATE ARE COVERED UNDER SECTIONS I  
AND III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 OR AN OPINION OF COUNSEL
SATISFACTORY TO THE TRUSTEE, TO THE EFFECT THAT THE PURCHASE OR HOLDING OF THIS 
CERTIFICATE WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION
WITHIN THE MEANING OF ERISA, SECTION 4975 OF THE CODE OR ANY SIMILAR LAW AND    
WILL NOT SUBJECT THE TRUSTEE, THE DEPOSITOR OR THE SERVICERS TO ANY OBLIGATION  
IN ADDITION TO THOSE EXPRESSLY UNDERTAKEN IN THE AGREEMENT OR TO ANY LIABILITY. 
NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY HEREIN, ANY PURPORTED TRANSFER OF 
THIS CERTIFICATE TO OR ON BEHALF OF AN EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE I 
OF ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW WITHOUT THE REPRESENTATION    
LETTER OR OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE AS DESCRIBED ABOVE     
SHALL BE VOID AND OF NO EFFECT.                                                 

Certificate No.                         : X-1                                   
Cut-off Date                            : January 1, 2006                       
First Distribution Date                 : February 27, 2006                     
Percentage Interest of this                                                     
Certificate ("Denomination")            : [__]%                                 

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 MORGAN STANLEY ABS CAPITAL I INC.

Morgan Stanley ABS Capital I Inc. Trust 2006-NC1
 Mortgage Pass-Through Certificates, Series 2006-NC1

 Class X

          evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class.         

      Distributions in respect of this Certificate are distributable
monthly as set forth herein. This Certificate does not evidence an obligation   
of, or an interest in, and is not guaranteed by the Depositor, the Trustee or   
any other party to the Agreement referred to below or any of their respective   
affiliates. Neither this Certificate nor the Mortgage Loans are guaranteed or   
insured by any governmental agency or instrumentality.                          

          This certifies that ___________________________, is the registered
owner of the Percentage Interest evidenced by this Certificate (obtained by     
dividing the denomination of this Certificate by the aggregate of the           
denominations of all Certificates of the Class to which this Certificate        
belongs) in certain monthly distributions pursuant to a Pooling and Servicing   
Agreement dated as of the Cut-off Date specified above (the "Agreement") among  
Morgan Stanley ABS Capital I Inc., as depositor (the "Depositor"), JPMorgan     
Chase Bank, National Association, as servicer, NC Capital Corporation, as       
responsible party, and Deutsche Bank National Trust Company, as trustee (the    
"Trustee"). To the extent not defined herein, the capitalized terms used herein 
have the meanings assigned in the Agreement. This Certificate is issued under   
and is subject to the terms, provisions and conditions of the Agreement, to     
which Agreement the Holder of this Certificate by virtue of the acceptance      
hereof assents and by which such Holder is bound.                               

            This Certificate does not have a Certificate Balance or Pass-Through
Rate and will be entitled to distributions only to the extent set forth in the  
Agreement. In addition, any distribution of the proceeds of any remaining assets
of the Trust will be made only upon presentment and surrender of this           
Certificate at the offices designated by the Trustee for such purposes or such  
other location specified in the notice to Certificateholders.                   

            No transfer of a Certificate of this Class shall be made unless such
disposition is exempt from the registration requirements of the Securities Act  
of 1933, as amended (the "Securities Act"), and any applicable state securities 
laws or is made in accordance with the Securities Act and such laws. In the     
event of any such transfer, the Trustee shall require the transferor to execute 
a transferor certificate (in substantially the form attached to the Pooling and 
Servicing Agreement) and deliver either (i) a Rule 144A Letter, in either case  
substantially in the form attached to the Agreement, or (ii) a written Opinion  
of Counsel to the Trustee that such transfer may be made pursuant to an         
exemption, describing the applicable exemption and the basis therefor, from the 
Securities Act or is being made pursuant to the Securities Act, which Opinion of
Counsel shall be an expense of the transferor.                                  

           No transfer of a Certificate of this Class shall be made unless the
Trustee shall have received either (i) a representation letter from the         
transferee of such Certificate, acceptable to and in form and substance         
satisfactory to the Trustee, to the effect that such transferee is not an       
employee benefit plan subject to Section 406 of ERISA or Section 4975 of the    
Code or any materially similar provisions of applicable Federal, state or local 
law ("Similar Law") or a person acting on behalf of or investing plan assets of 
any such plan, which representation letter shall not be an expense of the       
Trustee, or (ii) if the transferee is an insurance company, a representation    
letter that it is purchasing such Certificates with the assets of its general   
account and that the purchase and holding of such Certificates are covered under
Sections I and III of PTCE 95-60, or (iii) in the case of a Certificate         
presented for registration in the name of an employee benefit plan subject to   
ERISA, or a plan or arrangement subject to Section 4975 of the Code (or         
comparable provisions of any subsequent enactments) or a plan subject to Similar
Law, or a trustee of any such plan or any other person acting on behalf of any  
such plan or arrangement or using such plan's or arrangement's assets, an       
Opinion of Counsel satisfactory to the Trustee, which Opinion of Counsel shall  
not be an expense of the Trustee, the Servicers or the Trust Fund, addressed to 
the Trustee, to the effect that the purchase or holding of such Certificate will
not constitute or result in a non-exempt prohibited transaction within the      
meaning of ERISA, Section 4975 of the Code or any Similar Law and will not      
subject the Depositor, the Trustee or the Servicers to any obligation in        
addition to those expressly undertaken in the Agreement or to any liability.    

  Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for 
all purposes have the same effect as if set forth at this place.                

       This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually authenticated by an       
authorized signatory of the Trustee.                                            

 * * *

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         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.                                                                  

Dated:                                                                          

                                  DEUTSCHE BANK NATIONAL TRUST
                  COMPANY,
                                         not in its individual capacity,
                               but solely as Trustee

         By:
                                              ----------------------------------

Authenticated:                                                                  

By:                                                                             
-------------------------------------                                     
Authorized Signatory of                                                   
DEUTSCHE BANK NATIONAL TRUST COMPANY,                                     
not in its individual capacity,                                           
but solely as Trustee                                                     

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 MORGAN STANLEY ABS CAPITAL I INC.
Morgan Stanley ABS Capital I Inc. Trust 2006-NC1
Mortgage Pass-Through Certificates

          This Certificate is one of a duly authorized issue of Certificates
designated as Morgan Stanley ABS Capital I Inc. Trust 2006-NC1 Mortgage         
Pass-Through Certificates, of the Series specified on the face hereof (herein   
collectively called the "Certificates"), and representing a beneficial ownership
interest in the Trust Fund created by the Agreement.                            

            The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders  
for any amount payable under this Certificate or the Agreement or, except as    
expressly provided in the Agreement, subject to any liability under the         
Agreement.                                                                      

        This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of 
rights, benefits, obligations and duties evidenced thereby, and the rights,     
duties and immunities of the Trustee.                                           

           Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the   
Business Day immediately following (the "Distribution Date"), commencing on the 
first Distribution Date specified on the face hereof, to the Person in whose    
name this Certificate is registered at the close of business on the applicable  
Record Date in an amount equal to the product of the Percentage Interest        
evidenced by this Certificate and the amount required to be distributed to      
Holders of Certificates of the Class to which this Certificate belongs on such  
Distribution Date pursuant to the Agreement. The Record Date applicable to each 
Distribution Date is the last Business Day of the month next preceding the month
of such Distribution Date.                                                      

           Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or    
other entity having appropriate facilities therefor, if such Certificateholder  
shall have so notified the Trustee in writing at least five Business Days prior 
to the related Record Date and such Certificateholder shall satisfy the         
conditions to receive such form of payment set forth in the Agreement, or, if   
not, by check mailed by first class mail to the address of such                 
Certificateholder appearing in the Certificate Register. The final distribution 
on each Certificate will be made in like manner, but only upon presentment and  
surrender of such Certificate at the offices designated by the Trustee for such 
purposes or such other location specified in the notice to Certificateholders of
such final distribution.                                                        

            The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the     
Trustee and the rights of the Certificateholders under the Agreement at any time
by the parties to the Agreement with the consent of the Holders of Certificates 
affected by such amendment evidencing the requisite Percentage Interest, as     
provided in the Agreement. Any such consent by the Holder of this Certificate   
shall be conclusive and binding on such Holder and upon all future Holders of   
this Certificate and of any Certificate issued upon the transfer hereof or in   
exchange therefor or in lieu hereof whether or not notation of such consent is  
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the 
Certificates.                                                                   

       As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the       
Certificate Register of the Trustee upon surrender of this Certificate for      
registration of transfer at the offices designated by the Trustee for such      
purposes, accompanied by a written instrument of transfer in form satisfactory  
to the Trustee duly executed by the holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same   
Class in authorized denominations and evidencing the same aggregate Percentage  
Interest in the Trust Fund will be issued to the designated transferee or       
transferees.                                                                    

     The Certificates are issuable only as registered Certificates
without coupons in denominations specified in the Agreement. As provided in the 
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations 
and evidencing the same aggregate Percentage Interest, as requested by the      
Holder surrendering the same.                                                   

            No service charge will be made for any such registration of transfer
or exchange, but the Trustee may require payment of a sum sufficient to cover   
any tax or other governmental charge payable in connection therewith.           

           The Depositor and the Trustee and any agent of the Depositor or the
Trustee may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and neither the Depositor, the Trustee, nor any  
such agent shall be affected by any notice to the contrary.                     

        On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Cut-off Date  
Pool Principal Balance, HomEq Servicing Corporation, will have the option to    
repurchase, in whole, from the Trust Fund all remaining Mortgage Loans and all  
property acquired in respect of the Mortgage Loans at a purchase price          
determined as provided in the Agreement. The obligations and responsibilities   
created by the Agreement will terminate as provided in Section 9.01 of the      
Agreement.                                                                      

            Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed           
inconsistent with that meaning.                                                 

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ASSIGNMENT
----------

FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)   
unto                                                                            

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

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

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

--------------------------------------------------------------------------------
(Please print or typewrite name and address including postal zip code of        
assignee)                                                                       

the Percentage Interest evidenced by the within Certificate and hereby          
authorizes the transfer of registration of such Percentage Interest to assignee 
on the Certificate Register of the Trust Fund.                                  

         I (We) further direct the Trustee to issue a new Certificate of a
like denomination and Class, to the above named assignee and deliver such       
Certificate to the following address: _________________________________________.

Dated:                                                                          

                                      ------------------------------------------
                                 Signature by or on behalf of assignor

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 DISTRIBUTION INSTRUCTIONS

 The assignee should include the following for purposes of
distribution:                                                                   

      Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ________________________________________________,
_______________________________________________________________________________,
for the account of ____________________________________________________________,
account number _______, or, if mailed by check, to ____________________________.
Applicable statements should be mailed to _____________________________________,
_______________________________________________________________________________.

            This information is provided by ___________________________________,
the assignee named above, or __________________________________________________,
as its agent.                                                                   

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 EXHIBIT E

FORM OF INITIAL CERTIFICATION OF TRUSTEE

[date]

Morgan Stanley ABS Capital I Inc.                                               
1585 Broadway, 38th Floor                                                       
New York, New York 10036                                                        

JPMorgan Chase Bank, National Association                                       
c/o Chase Home Finance LLC                                                      
10790 Rancho Bernado                                                            
San Diego, California 92127                                                     

HomEq Servicing Corporation                                                     
4837 Watt Avenue                                                                
North Highlands, California 95660-5101                                          

NC Capital Corporation                                                          
18400 Von Karman, Suite 1000                                                    
Irvine, California  92612                                                       

Deutsche Bank National Trust Company                                            
1761 East St. Andrew Place                                                      
Santa Ana, California 92705                                                     

     Re:   Pooling and Servicing Agreement, dated as of January 1, 2006, among
       Morgan Stanley ABS Capital I Inc., as Depositor, JPMorgan Chase
  Bank, National Association, as a Servicer, HomEq Servicing
          Corporation, as a Servicer, NC Capital Corporation, as Responsible
           Party, and Deutsche Bank National Trust Company, as Trustee, Morgan
Stanley ABS Capital I Inc. Trust, Series 2006-NC1       
-------------------------------------------------       

Ladies and Gentlemen:                                                           

          In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), for each Mortgage  
Loan listed in the Mortgage Loan Schedule (other than any Mortgage Loan listed  
in the attached schedule), it has received:                                     

   (i) the original Mortgage Note, endorsed as provided in the
 following form: "Pay to the order of ________, without recourse"; and

     (ii) a duly executed assignment of the Mortgage (which may be
included in a blanket assignment or assignments).                   

        Based on its review and examination and only as to the foregoing
documents, such documents appear regular on their face and related to such      
Mortgage Loan.                                                                  

        The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the  
Pooling and Servicing Agreement. The Trustee makes no representations as to: (i)
the validity, legality, sufficiency, enforceability or genuineness of any of the
documents contained in each Mortgage File of any of the Mortgage Loans          
identified on the Mortgage Loan Schedule, or (ii) the collectability,           
insurability, effectiveness or suitability of any such Mortgage Loan.           
Notwithstanding anything herein to the contrary, the Trustee has made no        
determination and makes no representations as to whether (i) any endorsement is 
sufficient to transfer all right, title and interest of the party so endorsing, 
as Noteholder or assignee thereof, in and to that Mortgage Note or (ii) any     
assignment is in recordable form or sufficient to effect the assignment of and  
transfer to the assignee thereof, under the Mortgage to which the assignment    
relates.                                                                        

           Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement.               

                                     DEUTSCHE BANK NATIONAL TRUST COMPANY,
                      as Trustee

   By:
                                           -------------------------------------
     Name:
                                             -----------------------------------
      Title:
                                              ----------------------------------

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 EXHIBIT F

FORM OF DOCUMENT CERTIFICATION
 AND EXCEPTION REPORT OF TRUSTEE

[date]

Morgan Stanley ABS Capital I Inc.                                               
1585 Broadway, 38th Floor                                                       
New York, New York 10036                                                        

JPMorgan Chase Bank, National Association                                       
c/o Chase Home Finance LLC                                                      
10790 Rancho Bernado                                                            
San Diego, California 92127                                                     

HomEq Servicing Corporation                                                     
4837 Watt Avenue                                                                
North Highlands, California 95660-5101                                          

NC Capital Corporation                                                          
18400 Von Karman, Suite 1000                                                    
Irvine, California  92612                                                       

Deutsche Bank National Trust Company                                            
1761 East St. Andrew Place                                                      
Santa Ana, California 92705                                                     

     Re:   Pooling and Servicing Agreement, dated as of January 1, 2005, among
       Morgan Stanley ABS Capital I Inc., as Depositor, JPMorgan Chase
  Bank, National Association, as a Servicer, HomEq Servicing
          Corporation, as a Servicer, NC Capital Corporation, as Responsible
           Party, and Deutsche Bank National Trust Company, as Trustee, Morgan
Stanley ABS Capital I Inc. Trust, Series 2006-NC1       
-------------------------------------------------       

Ladies and Gentlemen:                                                           

          In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), the undersigned, as
Trustee, hereby certifies that as to each Mortgage Loan listed in the Mortgage  
Loan Schedule (other than any Mortgage Loan paid in full or listed on the       
attached Document Exception Report) it has received:                            

        (i) The original Mortgage Note, endorsed in the form provided in
     Section 2.01 of the Pooling and Servicing Agreement, with all intervening
    endorsements showing a complete chain of endorsement from the originator
to the last endorsee.                                               

(ii) The original recorded Mortgage.                    

    (iii) A duly executed assignment of the Mortgage in the form
   provided in Section 2.01 of the Pooling and Servicing Agreement; or, if
   the Responsible Party has certified or the Trustee otherwise knows that
    the related Mortgage has not been returned from the applicable recording
      office, a copy of the assignment of the Mortgage (excluding information to
be provided by the recording office).                               

      (iv) The original or duplicate original recorded assignment or
   assignments of the Mortgage showing a complete chain of assignment from
the originator to the last endorsee.                                

            (v) The original or duplicate original lender's title policy and all
riders thereto or, any one of an original title binder, an original 
preliminary title report or an original title commitment, or a copy 
thereof certified by the title company.                             

        Based on its review and examination and only as to the foregoing
documents, (a) such documents appear regular on their face and related to such  
Mortgage Loan, and (b) the information set forth in items (1) solely with       
respect to the Mortgage Loan number, (2) and (7) of the Mortgage Loan Schedule  
and items (1), (9) and (17) of the Data Tape Information accurately reflects    
information set forth in the Custodial File.                                    

        The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review of the Custodial File         
specifically required in the Pooling and Servicing Agreement. The Trustee makes 
no representations as to: (i) the validity, legality, sufficiency,              
enforceability or genuineness of any of the documents contained in each Mortgage
File of any of the Mortgage Loans identified on the Mortgage Loan Schedule, or  
(ii) the collectability, insurability, effectiveness or suitability of any such 
Mortgage Loan. Notwithstanding anything herein to the contrary, the Trustee has 
made no determination and makes no representations as to whether (i) any        
endorsement is sufficient to transfer all right, title and interest of the party
so endorsing, as Noteholder or assignee thereof, in and to that Mortgage Note or
(ii) any assignment is in recordable form or sufficient to effect the assignment
of and transfer to the assignee thereof, under the Mortgage to which the        
assignment relates.                                                             

           Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement.               

                                     DEUTSCHE BANK NATIONAL TRUST COMPANY,
                      as Trustee

   By:
                                           -------------------------------------
     Name:
                                             -----------------------------------
      Title:
                                              ----------------------------------

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 EXHIBIT G

 RESIDUAL TRANSFER AFFIDAVIT

 Morgan Stanley ABS Capital I Inc. Trust 2006-NC1,
 Mortgage Pass-Through Certificates,
 Series 2006-NC1

STATE OF          )                                                             
) ss.:                                      
COUNTY OF         )                                                             

    The undersigned, being first duly sworn, deposes and says as
follows:                                                                        

    1. The undersigned is an officer of ___________________, the
proposed Transferee of an Ownership Interest in a Class R Certificate (the      
"Certificate") issued pursuant to the Pooling and Servicing Agreement (the      
"Agreement"), relating to the above-referenced Series, by and among Morgan      
Stanley ABS Capital I Inc., as Depositor, JPMorgan Chase Bank, National         
Association, as a Servicer, HomEq Servicing Corporation, as Servicer, NC Capital
Corporation, as Responsible Party, and Deutsche Bank National Trust Company, as 
Trustee (the "Trustee"). Capitalized terms used, but not defined herein, shall  
have the meanings ascribed to such terms in the Agreement. The Transferee has   
authorized the undersigned to make this affidavit on behalf of the Transferee   
for the benefit of the Depositor and the Trustee.                               

           2. The Transferee is, as of the date hereof, and will be, as of the
date of the Transfer, a Permitted Transferee. The Transferee is acquiring its   
Ownership Interest in the Certificate for its own account. The Transferee has no
knowledge that any such affidavit is false.                                     

         3. The Transferee has been advised of, and understands that (i) a
tax will be imposed on Transfers of the Certificate to Persons that are         
Non-Permitted Transferees; (ii) such tax will be imposed on the transferor, or, 
if such Transfer is through an agent (which includes a broker, nominee or       
middleman) for a Person that is a Non-Permitted Transferee, on the agent; and   
(iii) the Person otherwise liable for the tax shall be relieved of liability for
the tax if the subsequent Transferee furnished to such Person an affidavit that 
such subsequent Transferee is a Permitted Transferee and, at the time of        
Transfer, such Person does not have actual knowledge that the affidavit is      
false.                                                                          

         4. The Transferee has been advised of, and understands that a tax
will be imposed on a "pass-through entity" holding the Certificate if at any    
time during the taxable year of the pass-through entity a Person that is a      
Non-Permitted Transferee is the record holder of an interest in such entity. The
Transferee understands that such tax will not be imposed for any period with    
respect to which the record holder furnishes to the pass-through entity an      
affidavit that such record holder is a Permitted Transferee and the pass-through
entity does not have actual knowledge that such affidavit is false. (For this   
purpose, a "pass-through entity" includes a regulated investment company, a real
estate investment trust or common trust fund, a partnership, trust or estate,   
and certain cooperatives and, except as may be provided in Treasury Regulations,
persons holding interests in pass-through entities as a nominee for another     
Person.)                                                                        

           5. The Transferee has reviewed the provisions of Section 5.02(c) of
the Agreement and understands the legal consequences of the acquisition of an   
Ownership Interest in the Certificate including, without limitation, the        
restrictions on subsequent Transfers and the provisions regarding voiding the   
Transfer and mandatory sales. The Transferee expressly agrees to be bound by and
to abide by the provisions of Section 5.02(c) of the Agreement and the          
restrictions noted on the face of the Certificate. The Transferee understands   
and agrees that any breach of any of the representations included herein shall  
render the Transfer to the Transferee contemplated hereby null and void.        

         6. The Transferee agrees to require a Transfer Affidavit from any
Person to whom the Transferee attempts to Transfer its Ownership Interest in the
Certificate, and in connection with any Transfer by a Person for whom the       
Transferee is acting as nominee, trustee or agent, and the Transferee will not  
Transfer its Ownership Interest or cause any Ownership Interest to be           
Transferred to any Person that the Transferee knows is a Non-Permitted          
Transferee. In connection with any such Transfer by the Transferee, the         
Transferee agrees to deliver to the Trustee a certificate substantially in the  
form set forth as Exhibit H to the Agreement (a "Transferor Certificate") to the
effect that, among other things, such Transferee has no actual knowledge that   
the Person to which the Transfer is to be made is a Non-Permitted Transferee.   

   7. The Transferee does not have the intention to impede the
assessment or collection of any tax legally required to be paid with respect to 
the Certificate. The Transferee has historically paid its debts as they have    
come due and intends to pay its debts as they come due in the future. The       
Transferee intends to pay all taxes due with respect to the Certificate as they 
become due.                                                                     

         8. The Transferee's taxpayer identification number is __________.

     9. The Transferee is a U.S. Person as defined in Code Section
7701(a)(30).                                                                    

 10. The Transferee is aware that the Certificate may be a
"noneconomic residual interest" within the meaning of proposed Treasury         
regulations promulgated pursuant to the Code and that the transferor of a       
noneconomic residual interest will remain liable for any taxes due with respect 
to the income on such residual interest, unless no significant purpose of the   
transfer was to impede the assessment or collection of tax.                     

  11. The Transferee will not cause income from the Residual
Certificate to be attributable to a foreign permanent establishment or fixed    
base, within the meaning of an applicable income tax treaty, of the Transferee  
or any other U.S. Person.                                                       

12. Check the applicable paragraph:                     

  (i)   The present value of the anticipated tax liabilities
                associated with holding the Certificate, as applicable, does
not exceed the sum of:                      

            (ii)  the present value of any consideration given to the Transferee
to acquire such Certificate;                

            (iii) the present value of the expected future distributions on such
Certificate; and                            

         (iv)  the present value of the anticipated tax savings associated
                with holding such Certificate as the related REMIC generates
losses.                                     

          For purposes of this calculation, (i) the Transferee is assumed to
pay tax at the highest rate currently specified in Section 11(b) of the Code    
(but the tax rate in Section 55(b)(1)(B) of the Code may be used in lieu of the 
highest rate specified in Section 11(b) of the Code if the Transferee has been  
subject to the alternative minimum tax under Section 55 of the Code in the      
preceding two years and will compute its taxable income in the current taxable  
year using the alternative minimum tax rate) and (ii) present values are        
computed using a discount rate equal to the short-term Federal rate prescribed  
by Section 1274(d) of the Code for the month of the transfer and the compounding
period used by the Transferee.                                                  

       (i) The transfer of the Certificate complies with U.S. Treasury
Regulations Sections 1.860E-1(c)(5) and (6) and, accordingly,       

            (ii) the Transferee is an "eligible corporation," as defined in U.S.
   Treasury Regulations Section 1.860E-1(c)(6)(i), as to which income from
the Certificate will only be taxed in the United States;            

  (iii) at the time of the transfer, and at the close of the
 Transferee's two fiscal years preceding the year of the transfer, the
   Transferee had gross assets for financial reporting purposes (excluding
      any obligation of a person related to the Transferee within the meaning of
   U.S. Treasury Regulations Section 1.860E-1(c)(6)(ii)) in excess of $100
million and net assets in excess of $10 million;                    

        (iv) he Transferee will transfer the Certificate only to another
   "eligible corporation," as defined in U.S. Treasury Regulations Section
  1.860E-1(c)(6)(i), in a transaction that satisfies the requirements of
    Sections 1.860E-1(c)(4)(i), (ii) and (iii) and Section 1.860E-1(c)(5) of
the U.S. Treasury Regulations; and                                  

     (v) the Transferee determined the consideration paid to it to
      acquire the Certificate based on reasonable market assumptions (including,
   but not limited to, borrowing and investment rates, prepayment and loss
  assumptions, expense and reinvestment assumptions, tax rates and other
     factors specific to the Transferee) that it has determined in good faith.

(vi) None of the above.                                 

            5. The Transferee is not an employee benefit plan that is subject to
Title I of ERISA or a plan that is subject to Section 4975 of the Code or a plan
subject to any Federal, state or local law that is substantially similar to     
Title I of ERISA or Section 4975 of the Code, and the Transferee is not acting  
on behalf of or investing plan assets of such a plan.                           

 * * *

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           IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by its 
duly authorized officer and its corporate seal to be hereunto affixed, duly     
attested, this day of , 20__.                                                   

                                        ----------------------------------------
                        Print Name of Transferee

   By:
                                           -------------------------------------
           Name:
            Title:

[Corporate Seal]                                                                

ATTEST:                                                                         

[Assistant] Secretary                                                           

          Personally appeared before me the above-named __________, known or
proved to me to be the same person who executed the foregoing instrument and to 
be the ___________ of the Transferee, and acknowledged that he executed the same
as his free act and deed and the free act and deed of the Transferee.           

     Subscribed and sworn before me this ____ day of ______, 20__.

                                        ----------------------------------------
                                   NOTARY PUBLIC

                                My Commission expires the __ day
                  of _________, 20__

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 EXHIBIT H

FORM OF TRANSFEROR CERTIFICATE

                                                                __________, 20__

Morgan Stanley ABS Capital I Inc.                                               
1585 Broadway, 38th Floor                                                       
New York, New York  10036                                                       
Attention:  Michelle Wilke                                                      

Deutsche Bank National Trust Company,                                           
as Trustee                                                                  
1761 East St. Andrew Place                                                      
Santa Ana, California  92705                                                    

Re:   Morgan Stanley ABS Capital I Inc. Trust 2006-NC1              
      Mortgage Pass-Through Certificates, Series 2006-NC1, Class [ ]
      --------------------------------------------------------------

Ladies and Gentlemen:                                                           

       In connection with our disposition of the above Certificates we
certify that (a) we understand that the Certificates have not been registered   
under the Securities Act of 1933, as amended (the "Act"), and are being disposed
by us in a transaction that is exempt from the registration requirements of the 
Act, (b) we have not offered or sold any Certificates to, or solicited offers to
buy any Certificates from, any person, or otherwise approached or negotiated    
with any person with respect thereto, in a manner that would be deemed, or taken
any other action which would result in, a violation of Section 5 of the Act and 
(c) to the extent we are disposing of a Residual Certificate, (i) we have no    
knowledge the Transferee is a Non-Permitted Transferee, (ii) after conducting a 
reasonable investigation of the financial condition of the Transferee, we have  
no knowledge and no reason to believe that the Transferee will not pay all taxes
with respect to the Residual Certificates as they become due and (iii) we have  
no reason to believe that the statements made in paragraphs 7, 10 and 11 of the 
Transferee's Residual Transfer Affidavit are false.                             

                 Very truly yours,

                                        ----------------------------------------
                        Print Name of Transferor

   By:
                                           -------------------------------------
                                      Authorized Officer

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 EXHIBIT I

FORM OF RULE 144A LETTER

                                                              ____________, 20__

Morgan Stanley ABS Capital I Inc.                                               
1585 Broadway, 38th Floor                                                       
New York, New York  10036                                                       
Attention:  Michelle Wilke                                                      

Deutsche Bank National Trust Company,                                           
as Trustee                                                                      
1761 East St. Andrew Place                                                      
Santa Ana, California  92705                                                    

Re:   Morgan Stanley ABS Capital I Inc. Trust 2006-NC1, Mortgage    
Pass-Through Certificates, Series 2006-NC1, Class [___] 
------------------------------------------------------- 

Ladies and Gentlemen:                                                           

       In connection with our acquisition of the above Certificates we
certify that (a) we understand that the Certificates are not being registered   
under the Securities Act of 1933, as amended (the "Act"), or any state          
securities laws and are being transferred to us in a transaction that is exempt 
from the registration requirements of the Act and any such laws, (b) we have    
such knowledge and experience in financial and business matters that we are     
capable of evaluating the merits and risks of investments in the Certificates,  
(c) we have had the opportunity to ask questions of and receive answers from the
Depositor concerning the purchase of the Certificates and all matters relating  
thereto or any additional information deemed necessary to our decision to       
purchase the Certificates, (d) either we are purchasing a Class A-1, Class A-2, 
Class A-3, Class A-4, Class M-1, Class M-2, Class M-3, Class M-4, Class M-5,    
Class M-6, Class B-1, Class B-2 or Class B-3 Certificate or we are not an       
employee benefit plan that is subject to Title I of the Employee Retirement     
Income Security Act of 1974, as amended ("ERISA"), or a plan or arrangement that
is subject to Section 4975 of the Internal Revenue Code of 1986, as amended, or 
a plan subject to materially similar provisions of applicable federal, state or 
local law, nor are we acting on behalf of any such plan or arrangement nor using
the assets of any such plan or arrangement to effect such acquisition or, with  
respect to a Class X Certificate, the purchaser is an insurance company that is 
purchasing this certificate with funds contained in an "insurance company       
general account" (as such term is defined in Section V(e) of Prohibited         
Transaction Class Exemption 95-60 ("PTCE 95-60")) and that the purchase and     
holding of such Certificates are covered under Sections I and III of PTCE 95-60,
(e) we have not, nor has anyone acting on our behalf offered, transferred,      
pledged, sold or otherwise disposed of the Certificates, any interest in the    
Certificates or any other similar security to, or solicited any offer to buy or 
accept a transfer, pledge or other disposition of the Certificates, any interest
in the Certificates or any other similar security from, or otherwise approached 
or negotiated with respect to the Certificates, any interest in the Certificates
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, that would constitute a distribution of the Certificates
under the Securities Act or that would render the disposition of the            
Certificates a violation of Section 5 of the Securities Act or require          
registration pursuant thereto, nor will act, nor has authorized or will         
authorize any person to act, in such manner with respect to the Certificates,   
and (f) we are a "qualified institutional buyer" as that term is defined in Rule
144A under the Securities Act and have completed either of the forms of         
certification to that effect attached hereto as Annex 1 or Annex 2. We are aware
that the sale to us is being made in reliance on Rule 144A. We are acquiring the
Certificates for our own account or for resale pursuant to Rule 144A and        
further, understand that such Certificates may be resold, pledged or transferred
only (i) to a person reasonably believed to be a qualified institutional buyer  
that purchases for its own account or for the account of a qualified            
institutional buyer to whom notice is given that the resale, pledge or transfer 
is being made in reliance on Rule 144A, or (ii) pursuant to another exemption   
from registration under the Securities Act.                                     

           In connection with our purchase of the Certificates, we acknowledge
and agree that (i) none of you nor any of your affiliates is acting as a        
fiduciary or financial or investment adviser for us; (ii) we are not relying    
(for purposes of making any investment decision or otherwise) upon any advice,  
counsel or representations (whether written or oral) of any of you or your      
affiliates with respect to the Certificates; (iii) none of you nor any of your  
affiliates has given to us (directly or indirectly through any other person) any
assurance, guarantee or representation whatsoever as to the expected or         
projected success, profitability, return, performance, result, effect,          
consequence, or benefit (including legal, regulatory, tax, financial, accounting
or otherwise) of our purchase of the Certificates; (iv) we have performed our   
own diligence to the extent we have deemed necessary and we have consulted with 
our own legal, regulatory, tax, business, investment, financial and accounting  
advisers to the extent that we have deemed necessary, and we have made our own  
investment decisions based upon our own judgment and upon any advice from such  
advisers as we have deemed necessary and appropriate and not upon any view      
expressed by any of you or your affiliates with respect to the Certificates; (v)
none of you nor any of your affiliates will be obligated to make payments on the
Certificates in the event that the assets of the trust is insufficient to       
provide for such payments; (vi) you and your affiliates may have positions and  
may effect transactions in any of the Series 2006-NC1 securities; and (vii) we  
are familiar with the Certificates and have reviewed and understand the related 
pooling and servicing agreement, the prospectus supplement and prospectus       
relating to Series 2006-NC1 and the other material transaction documents related
thereto.                                                                        

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                                                            ANNEX 1 TO EXHIBIT I
                                                            --------------------

QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
--------------------------------------------------------

[For Transferees Other Than Registered Investment Companies]

        The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this            
certification relates with respect to the Certificates described therein:       

      1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the      
Buyer.                                                                          

    2. In connection with purchases by the Buyer, the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the  
Securities Act of 1933, as amended ("Rule 144A"), because (i) the Buyer owned   
and/or invested on a discretionary basis $ (1) in securities (except for the    
excluded securities referred to below) as of the end of the Buyer's most recent 
fiscal year (such amount being calculated in accordance with Rule 144A and (ii) 
the Buyer satisfies the criteria in the category marked below.                  

        ____  Corporation, etc. The Buyer is a corporation (other than a
               bank, savings and loan association or similar institution),
            Massachusetts or similar business trust, partnership, or
                 charitable organization described in Section 501(c)(3) of the
Internal Revenue Code of 1986, as amended.  

           ____  Bank. The Buyer (a) is a national bank or banking institution
           organized under the laws of any State, territory or the
                District of Columbia, the business of which is substantially
         confined to banking and is supervised by the State or
              territorial banking commission or similar official or is a
                  foreign bank or equivalent institution, and (b) has an audited
            net worth of at least $25,000,000 as demonstrated in its
          latest annual financial statements, a copy of which is
attached hereto.                            

   ____  Savings and Loan. The Buyer (a) is a savings and loan
                 association, building and loan association, cooperative bank,
          homestead association or similar institution, which is
                  supervised and examined by a State or Federal authority having
                  supervision over any such institutions or is a foreign savings
                 and loan association or equivalent institution and (b) has an
                audited net worth of at least $25,000,000 as demonstrated in
              its latest annual financial statements, a copy of which is
attached hereto.                            

         ____  Broker-dealer. The Buyer is a dealer registered pursuant to
      Section 15 of the Securities Exchange Act of 1934.

        ____  Insurance Company. The Buyer is an insurance company whose
               primary and predominant business activity is the writing of
                  insurance or the reinsuring of risks underwritten by insurance
                  companies and which is subject to supervision by the insurance
            commissioner or a similar official or agency of a State,
territory or the District of Columbia.      

      ____  State or Local Plan. The Buyer is a plan established and
             maintained by a State, its political subdivisions, or any
           agency or instrumentality of the State or its political
   subdivisions, for the benefit of its employees.

          ____  ERISA Plan. The Buyer is an employee benefit plan within the
                 meaning of Title I of the Employee Retirement Income Security
Act of 1974.                                

    ____  Investment Advisor. The Buyer is an investment advisor
         registered under the Investment Advisors Act of 1940.

          ____  Small Business Investment Company. Buyer is a small business
          investment company licensed by the U.S. Small Business
           Administration under Section 301(c) or (d) of the Small
Business Investment Act of 1958.            

           ____  Business Development Company. Buyer is a business development
              company as defined in Section 202(a)(22) of the Investment
Advisors Act of 1940.                       

    3. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer, (ii) securities that  
are part of an unsold allotment to or subscription by the Buyer, if the Buyer is
a dealer, (iii) securities issued or guaranteed by the U.S. or any              
instrumentality thereof, (iv) bank deposit notes and certificates of deposit,   
(v) loan participations, (vi) repurchase agreements, (vii) securities owned but 
subject to a repurchase agreement and (viii) currency, interest rate and        
commodity swaps.                                                                

         4. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Buyer, the Buyer used the 
cost of such securities to the Buyer and did not include any of the securities  
referred to in the preceding paragraph, except (i) where the Buyer reports its  
securities holdings in its financial statements on the basis of their market    
value, and (ii) no current information with respect to the cost of those        
securities has been published. If clause (ii) in the preceding sentence applies,
the securities may be valued at market. Further, in determining such aggregate  
amount, the Buyer may have included securities owned by subsidiaries of the     
Buyer, but only if such subsidiaries are consolidated with the Buyer in its     
financial statements prepared in accordance with generally accepted accounting  
principles and if the investments of such subsidiaries are managed under the    
Buyer's direction. However, such securities were not included if the Buyer is a 
majority-owned, consolidated subsidiary of another enterprise and the Buyer is  
not itself a reporting company under the Securities Exchange Act of 1934, as    
amended.                                                                        

        5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the Certificates 
are relying and will continue to rely on the statements made herein because one 
or more sales to the Buyer may be in reliance on Rule 144A.                     

            6. Until the date of purchase of the Rule 144A Securities, the Buyer
will notify each of the parties to which this certification is made of any      
changes in the information and conclusions herein. Until such notice is given,  
the Buyer's purchase of the Certificates will constitute a reaffirmation of this
certification as of the date of such purchase. In addition, if the Buyer is a   
bank or savings and loan is provided above, the Buyer agrees that it will       
furnish to such parties updated annual financial statements promptly after they 
become available.                                                               

                                        ----------------------------------------
                        Print Name of Transferee

   By:
                                           -------------------------------------
           Name:
            Title:

     Date:
                                             -----------------------------------

(1) Buyer must own and/or invest on a discretionary basis at least $100,000,000 
in securities unless Buyer is a dealer, and, in that case, Buyer must own and/or
invest on a discretionary basis at least $10,000,000 in securities.             

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                                                            ANNEX 2 TO EXHIBIT I
                                                            --------------------

QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
--------------------------------------------------------

[For Transferees That Are Registered Investment Companies]

        The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this            
certification relates with respect to the Certificates described therein:       

      1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the Buyer or, if the Buyer is a   
"qualified institutional buyer" as that term is defined in Rule 144A under the  
Securities Act of 1933, as amended ("Rule 144A"), because Buyer is part of a    
Family of Investment Companies (as defined below), is such an officer of the    
Adviser.                                                                        

           1. In connection with purchases by Buyer, the Buyer is a "qualified
     institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is
      an investment company registered under the Investment Company Act of 1940,
 as amended, and (ii) as marked below, the Buyer alone, or the Buyer's
     Family of Investment Companies, owned at least $100,000,000 in securities
   (other than the excluded securities referred to below) as of the end of
the Buyer's most recent fiscal year. For purposes of determining the
amount of securities owned by the Buyer or the Buyer's Family of    
  Investment Companies, the cost of such securities was used, except (i)
     where the Buyer or the Buyer's Family of Investment Companies reports its
 securities holdings in its financial statements on the basis of their
     market value, and (ii) no current information with respect to the cost of
those securities has been published. If clause (ii) in the preceding
sentence applies, the securities may be valued at market.           

    ____  The Buyer owned $________in securities (other than the
               excluded securities referred to below) as of the end of the
                 Buyer's most recent fiscal year (such amount being calculated
in accordance with Rule 144A).              

         ____  The Buyer is part of a Family of Investment Companies which
                 owned in the aggregate $________in securities (other than the
               excluded securities referred to below) as of the end of the
                 Buyer's most recent fiscal year (such amount being calculated
in accordance with Rule 144A).              

         2. The term "Family of Investment Companies" as used herein means
two or more registered investment companies (or series thereof) that have the   
same investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment  
adviser is a majority owned subsidiary of the other).                           

    3. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer or are part of the     
Buyer's Family of Investment Companies, (ii) securities issued or guaranteed by 
the U.S. or any instrumentality thereof, (iii) bank deposit notes and           
certificates of deposit, (iv) loan participations, (v) repurchase agreements,   
(vi) securities owned but subject to a repurchase agreement and (vii) currency, 
interest rate and commodity swaps.                                              

        4. The Buyer is familiar with Rule 144A and understands that the
parties listed in the Rule 144A Transferee Certificate to which this            
certification relates are relying and will continue to rely on the statements   
made herein because one or more sales to the Buyer will be in reliance on Rule  
144A. In addition, the Buyer will only purchase for the Buyer's own account.    

          5. Until the date of purchase of the Certificates, the undersigned
will notify the parties listed in the Rule 144A Transferee Certificate to which 
this certification relates of any changes in the information and conclusions    
herein. Until such notice is given, the Buyer's purchase of the Certificates    
will constitute a reaffirmation of this certification by the undersigned as of  
the date of such purchase.                                                      

                                        ----------------------------------------
                        Print Name of Transferee

   By:
                                           -------------------------------------
           Name:
            Title:

              IF AN ADVISER:

                                        ----------------------------------------
                   Print Name of Buyer

     Date:
                                             -----------------------------------

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 EXHIBIT J

 FORM OF REQUEST FOR RELEASE
 (for Trustee)

To:   [Trustee]                                                                 

Re:                                                                             

           In connection with the administration of the Mortgage Loans held by
you as the Trustee on behalf of the Certificateholders, we request the release, 
and acknowledge receipt, of the (Custodial File/[specify documents]) for the    
Mortgage Loan described below, for the reason indicated.                        

Mortgagor's Name, Address & Zip Code:                                           
-------------------------------------                                           

Mortgage Loan Number:                                                           
---------------------                                                           

Send Custodial File to:                                                         
-----------------------                                                         

Delivery Method (check one)                                                     
---------------------------                                                     

____1. Regular mail                                                             

____2. Overnight courier (Tracking information: )                               

If neither box 1 nor 2 is checked, regular mail shall be assumed. 

Reason for Requesting Documents (check one)                                     
-------------------------------------------                                     

____1. Mortgage Loan Paid in Full. (The Servicer hereby certifies that all      
amounts received in connection therewith have been credited to its
     Collection Account as provided in the Pooling and Servicing Agreement.)

____2. Mortgage Loan Repurchase Pursuant to Subsection 2.03 of the Pooling and  
     Servicing Agreement. (The Servicer hereby certifies that the repurchase
      price has been credited to Collection Account as provided in the Pooling
and Servicing Agreement.)                                         

____3. Mortgage Loan Liquidated By _________________. (The Servicer hereby      
    certifies that all proceeds of foreclosure, insurance, condemnation or
other liquidation have been finally received and credited to its  
  Collection Account pursuant to the Pooling and Servicing Agreement.)

____4. Mortgage Loan in Foreclosure.                                            

____5. Other (explain).                                                         

    If box 1, 2 or 3 above is checked, and if all or part of the
Custodial File was previously released to us, please release to us our previous 
request and receipt on file with you, as well as any additional documents in    
your possession relating to the specified Mortgage Loan.                        

           If box 4 or 5 above is checked, upon our return of all of the above
documents to you as the Trustee, please acknowledge your receipt by signing in  
the space indicated below, and returning this form if requested by us.          

          [SERVICER]

   By:
                                           -------------------------------------
           Name:
            Title:
           Date:

[ACKNOWLEDGED AND AGREED:                                                       

DEUTSCHE BANK NATIONAL TRUST                                                    
COMPANY, as Trustee                                                       

By:                                                                             
-------------------------------------                                     
Name:                                                                     
Title:                                                                    
Date:         ]                                                           

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 EXHIBIT K

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     
Sponsor and which shall be retained by the applicable Servicer or delivered to  
and retained by the Trustee, as applicable:                                     

            (i) The original Mortgage Note bearing all intervening endorsements,
   showing a complete chain of endorsement from the originator to the last
      endorsee endorsed "Pay to the order of _________________ without recourse"
    and signed (which may be by facsimile signature) in the name of the last
     endorsee by an authorized officer. To the extent that there is no room on
   the face of the Mortgage Notes for endorsements, the endorsement may be
    contained on an allonge, unless the Trustee is advised in writing by the
Responsible Party that state law does not so allow.                 

         (ii) The original of any guaranty executed in connection with the
Mortgage Note.                                                      

            (iii) The original Mortgage, with evidence of recording thereon or a
certified true copy of such Mortgage submitted for recording. If in 
      connection with any Mortgage Loan, the Responsible Party 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 Responsible
    Party shall deliver or cause to be delivered to the Trustee, 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 Responsible Party
or evidence of certification on the face of such photocopy of such  
Mortgage or a certificate from an escrow company, a title company or
  closing attorney 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 Trustee upon receipt thereof by
   the Responsible Party; 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 to be a
true and complete copy of the original recorded Mortgage.           

            (iv) The originals of all assumption, modification, consolidation or
   extension agreements, with evidence of recording thereon or a certified
true copy of such agreement submitted for recording.                

      (v) The original Assignment of Mortgage for each Mortgage Loan
endorsed in blank.                                                  

          (vi) Originals of all intervening assignments of mortgage (if any)
    evidencing a complete chain of assignment from the applicable originator
  to the last endorsee with evidence of recording thereon or a certified
true copy of such intervening assignments of mortgage submitted for 
  recording, 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 Responsible Party shall deliver or cause to be delivered to the 
     Trustee, 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 Responsible Party or evidence of certification on the
  face of such photocopy of such intervening assignment or a certificate
      from an escrow company, a title company or a closing attorney 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 to be a true and complete copy of the original recorded intervening
 assignment of mortgage will be promptly delivered to the Trustee upon
receipt thereof by the Responsible Party; 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.                                             

         (vii) The original mortgagee title insurance policy or attorney's
opinion of title and abstract of title.                             

          (viii) The original of any security agreement, chattel mortgage or
equivalent document executed in connection with the Mortgage (if    
provided).                                                          

(ix) Residential loan application.                      

(x) Mortgage Loan closing statement.                    

  (xi) Verification of employment and income, if applicable.

         (xii) Verification of acceptable evidence of source and amount of
down payment.                                                       

(xiii) Credit report on Mortgagor.                      

(xiv) Residential appraisal report.                     

(xv) Photograph of the Mortgaged Property.              

(xvi) Survey of the Mortgaged Property.                 

           (xvii) 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.                                      

(xviii) All required disclosure statements.             

     (xix) If required in an appraisal, termite report, structural
engineer's report, water potability and septic certification.       

(xx) Sales contract, if applicable.                     

          Evidence of payment of taxes and insurance, insurance claim files,
correspondence, current and historical computerized data files (which include   
records of tax receipts and payment history from the date of origination), 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.                              

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 EXHIBIT L

 FORM OF CERTIFICATION TO BE
 PROVIDED WITH FORM 10-K
 -----------------------

 Re:   Morgan Stanley ABS Capital I Inc. Trust 2006-NC1 (the "Trust"),
            Mortgage Pass-Through Certificates, Series 2006-NC1, issued pursuant
            to the Pooling and Servicing Agreement, dated as of January 1, 2006,
        among Morgan Stanley ABS Capital I Inc., as Depositor, JP Morgan
      Chase Bank, National Association, as a Servicer, Deutsche Bank
           National Trust Company, as trustee (the "Trustee"), HomEq Servicing
            Corporation, as a servicer (each a "Servicer" and, collectively, the
      "Servicers"), and NC Capital Corporation, as responsible party
      --------------------------------------------------------------

I, [identify the certifying individual], certify that:                          

    (1) I have reviewed this annual report on Form 10-K ("Annual
 Report"), and all reports on Form 10-D (collectively with this Annual
    Report, the "Reports") required to be filed in respect of period covered
by this Annual Report, of the Trust;                                

        (2) Based on my knowledge, the Reports, taken as a whole, do not
contain any untrue statement of a material fact or omit to state a  
material fact necessary to make the statements made, in light of the
    circumstances under which such statements were made, not misleading with
respect to the period covered by this Annual Report;                

         (3) Based on my knowledge, all of the distribution, servicing and
    other information required to be provided under Form 10-D for the period
covered by this Annual Report is included in the Reports;           

           (4) Based on my knowledge and the compliance statements required in
this Annual Report under Item 1123 of Regulation AB, and except as  
    disclosed in the Reports, the Servicers have fulfilled their obligations
under the Pooling and Servicing Agreement; and                      

         (5) All of the reports on assessment of compliance with servicing
      criteria for asset-backed securities and their related attestation reports
on assessment of compliance with servicing criteria required to be  
     included in this Annual Report in accordance with Item 1122 of Regulation
AB and Exchange Act Rules 13a-18 and 15d-18 have been included as an
exhibit to this Annual Report, except as otherwise disclosed in this
     Annual Report. Any material instances of non-compliance described in such
reports have been disclosed in this Annual Report.                  

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In giving the certifications above, I have reasonably relied on information     
provided to me by the following unaffiliated parties: the Trustee and the       
Servicers.                                                                      

Date:                                                                           
--------------------------                                            

-------------------------------                                                 
[Signature]                                                                     
[Title]                                                                         

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 EXHIBIT M

 FORM OF CERTIFICATION
TO BE PROVIDED BY THE TRUSTEE TO DEPOSITOR
------------------------------------------

 Re:   Morgan Stanley ABS Capital I Inc. Trust 2006-NC1 (the "Trust"),
            Mortgage Pass-Through Certificates, Series 2006-NC1, issued pursuant
            to the Pooling and Servicing Agreement, dated as of January 1, 2006,
       among Morgan Stanley ABS Capital I Inc., as Depositor, JPMorgan
      Chase Bank, National Association, as a Servicer, Deutsche Bank
           National Trust Company, as trustee (the "Trustee"), HomEq Servicing
          Corporation, as servicer (each a "Servicer" and, collectively, the
      "Servicers"), and NC Capital Corporation, as responsible party

        The Trustee hereby certifies to the Depositor, and its officers,
directors and affiliates, and with the knowledge and intent that they will rely 
upon this certification, that:                                                  

         (1) I have reviewed the annual report on Form 10-K for the fiscal
      year [___] (the "Annual Report"), and all reports on Form 10-D required to
    be filed in respect of period covered by the Annual Report (collectively
with the Annual Report, the "Reports"), of the Trust;               

          (2) To my knowledge, the Reports, taken as a whole, do not contain
    any untrue statement of a material fact or omit to state a material fact
      necessary to make the statements made, in light of the circumstances under
      which such statements were made, not misleading with respect to the period
     covered by the Annual Report, it being understood that the Trustee is not
    responsible for verifying the accuracy or completeness of information in
the Reports (a) provided by Persons other than the Trustee or any   
  Subcontractor utilized by the Trustee or (b) relating to Persons other
     than the Trustee or any Subcontractor utilized by the Trustee as to which
a Responsible Officer of the Trustee does not have actual knowledge;

      (3) To my knowledge, the distribution or servicing information
     required to be provided to the Trustee by each Servicer under the Pooling
   and Servicing Agreement for inclusion in the Reports is included in the
Reports; and                                                        

          (4) The report on assessment of compliance with servicing criteria
for asset-backed securities applicable to the Trustee and each      
Subcontractor utilized by the Trustee and their related attestation 
     reports on assessment of compliance with servicing criteria applicable to
   it required to be included in the Annual Report in accordance with Item
   1122 of Regulation AB and Exchange Act Rules 13a-18 and 15d-18 has been
  included as an exhibit to the Annual Report. Any material instances of
      non-compliance are described in such report and have been disclosed in the
Annual Report.                                                      

Date:                                                                           
--------------------------                                            

-------------------------------                                                 
[Signature]                                                                     
[Title]                                                                         

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 EXHIBIT N

 FORM OF CERTIFICATION
 TO BE PROVIDED BY THE SERVICER TO DEPOSITOR

 Re:   Morgan Stanley ABS Capital I Inc. Trust 2006-NC1 (the "Trust"),
            Mortgage Pass-Through Certificates, Series 2006-NC1, issued pursuant
            to the Pooling and Servicing Agreement, dated as of January 1, 2006,
       among Morgan Stanley ABS Capital I Inc., as Depositor, JPMorgan
        Chase Bank, National Association, (the "Company") as a Servicer,
         Deutsche Bank National Trust Company, as trustee (the "Trustee"),
HomEq Servicing Corporation, as servicer, and NC Capital
Corporation, as responsible party                       
---------------------------------                       

           [JPMorgan] [HomEq], certifies to the Depositor and the Trustee, and
their officers, directors and affiliates, and with the knowledge and intent that
they will rely upon this certification, that:                                   

         (1) The Company has reviewed the servicer compliance statement of
    [JPMorgan] [HomEq] and the compliance statements of each Subservicer, if
any, engaged by [JPMorgan] [HomEq] provided to the Depositor and the
     Trustee for the Trust's fiscal year [___] in accordance with Item 1123 of
      Regulation AB (each a "Compliance Statement"), the report on assessment of
      [JPMorgan's] [HomEq's] compliance with the servicing criteria set forth in
   Item 1122(d) of Regulation AB (the "Servicing Criteria") and reports on
assessment of compliance with servicing criteria for asset-backed   
securities of the [JPMorgan] [HomEq] and of each Subservicer or     
     Subcontractor, if any, engaged or utilized by [JPMorgan] [HomEq] provided
 to the Depositor and the Trustee for the Trust's fiscal year [___] 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 (each
a "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 related to
      each Servicing Assessment (each a "Attestation Report"), and all servicing
 reports, officer's certificates and other information relating to the
    servicing of the Mortgage Loans by [JPMorgan] [HomEq] during 200[ ] that
      were delivered or caused to be delivered by [JPMorgan] [HomEq] pursuant to
the Agreement (collectively, the "Servicing Information");          

        (2) Based on the Company's knowledge, the 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 Servicing
Information;                                                        

       (3) Based on the Company's knowledge, the servicing information
    required to be provided to the Trustee by [JPMorgan] [HomEq] pursuant to
 the Pooling and Servicing Agreement has been provided to the Trustee;

      (4) Based on the Company's knowledge and the compliance review
     conducted in preparing Compliance Statement of [JPMorgan] [HomEq] and, if
   applicable, reviewing each Compliance Statement of each Subservicer, if
any, engaged by [JPMorgan] [HomEq], and except as disclosed in such 
    Compliance Statement[(s)], [JPMorgan] [HomEq] [(directly and through its
      Subservicers, if any)] has fulfilled its obligations under the Pooling and
Servicing Agreement in all material respects.                       

           (5) Each Servicing Assessment of the [JPMorgan] [HomEq] and of each
   Subservicer or Subcontractor, if any, engaged or utilized by [JPMorgan]
     [HomEq] and its related Attestation Report required to be included in the
    Annual Report in accordance with Item 1122 of Regulation AB and Exchange
  Act Rules 13a-18 and 15d-18 has been provided to the Depositor and the
  Trustee. Any material instances of non-compliance are described in any
such Servicing Assessment or Attestation Report.                    

Date:                                                               
-----------------------------                             
By:                                                                 
-------------------------------                               
Name:                                                               
-----------------------------                             
Title:                                                              
----------------------------                            

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 EXHIBIT O

FORM OF SERVICER POWER OF ATTORNEY

When Recorded Mail To:                                                          

[HomEq Servicing Corporation                                                    
4837 Watt Avenue                                                                
North Highlands, California 95660-5101]                                         

 LIMITED POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that Deutsche Bank National Trust Company, a    
national banking association organized and existing under the laws of the United
States and having its principal place of business at 1761 East St. Andrew Place,
Santa Ana, California, 92705, as Trustee pursuant to that Morgan Stanley ABS    
Capital I Inc. Trust 2006-NC1 Pooling and Servicing Agreement dated as of       
January 1, 2006 (the "Agreement") by and among Morgan Stanley ABS Capital I     
Inc., as depositor (the "Depositor"), HomEq Servicing Corporation, as servicer  
("HomEq"), NC Capital Corporation, as a responsible party ("NC Capital") and    
Deutsche Bank National Trust Company, as trustee (the "Trustee"), hereby        
constitutes and appoints [HomEq] , by and through [HomEq's] officers, the       
Trustee's true and lawful Attorney-in-fact, in the Trustee's name, place and    
stead and for the Trustee's benefit, in connection with all mortgage loans      
serviced by [HomEq] pursuant to the Agreement solely for the purpose of         
performing such acts and executing such documents in the name of the Trustee    
necessary and appropriate to effectuate the following enumerated transactions in
respect of any of the mortgages or deeds of trust (the "Mortgages" and the      
"Deeds of Trust" respectively) and promissory notes secured thereby (the        
"Mortgage Notes") for which the undersigned is acting as Trustee for various    
certificateholders (whether the undersigned is named therein as mortgagee or    
beneficiary or has become mortgagee by virtue of endorsement of the Mortgage    
Note secured by any such Mortgage or Deed of Trust) and for which [HomEq] is    
acting as servicer.                                                             

This Appointment shall apply only to the following enumerated transactions and  
nothing herein or in the Agreement shall be construed to the contrary:          

  1.    The modification or re-recording of a Mortgage or Deed of Trust,
            where said modification or re-recording is solely for the purpose of
       correcting the Mortgage or Deed of Trust to conform same to the
         original intent of the parties thereto or to correct title errors
           discovered after such title insurance was issued; provided that (i)
       said modification or re-recording, in either instance, does not
     adversely affect the lien of the Mortgage or Deed of Trust as
    insured and (ii) otherwise conforms to the provisions of the
Agreement.                                              

    2.    The subordination of the lien of a Mortgage or Deed of Trust to an
            easement in favor of a public utility company of a government agency
          or unit with powers of eminent domain; this section shall include,
            without limitation, the execution of partial satisfactions/releases,
         partial reconveyances or the execution or requests to trustees to
accomplish same.                                        

  3.    The conveyance of the properties to the mortgage insurer, or the
          closing of the title to the property to be acquired as real estate
owned, or conveyance of title to real estate owned.     

4.    The completion of loan assumption agreements.                 

      5.    The full satisfaction/release of a Mortgage or Deed of Trust or full
          conveyance upon payment and discharge of all sums secured thereby,
           including, without limitation, cancellation of the related Mortgage
Note.                                                   

 6.    The assignment of any Mortgage or Deed of Trust and the related
        Mortgage Note, in connection with the repurchase of the mortgage
loan secured and evidenced thereby.                     

     7.    The full assignment of a Mortgage or Deed of Trust upon payment and
     discharge of all sums secured thereby in conjunction with the
          refinancing thereof, including, without limitation, the assignment
of the related Mortgage Note.                           

   8.    With respect to a Mortgage or Deed of Trust, the foreclosure, the
     taking of a deed in lieu of foreclosure, or the completion of
            judicial or non-judicial foreclosure or termination, cancellation or
          rescission of any such foreclosure, including, without limitation,
any and all of the following acts:                      

           a.    the substitution of trustee(s) serving under a Deed of Trust,
       in accordance with state law and the Deed of Trust;

     b.    the preparation and issuance of statements of breach or
non-performance;                            

     c.    the preparation and filing of notices of default and/or
notices of sale;                            

      d.    the cancellation/rescission of notices of default and/or
notices of sale;                            

e.    the taking of deed in lieu of foreclosure; and    

       f.    the preparation and execution of such other documents and
               performance of such other actions as may be necessary under
            the terms of the Mortgage, Deed of Trust or state law to
               expeditiously complete said transactions in paragraphs 8.a.
through 8.e. above.                         

     9.    With respect to the sale of property acquired through a foreclosure
          or deed-in lieu of foreclosure, including, without limitation, the
execution of the following documentation:               

a.    listing agreements;                               

b.    purchase and sale agreements;                     

           c.    grant/warranty/quit claim deeds or any other deed causing the
              transfer of title of the property to a party contracted to
purchase same;                              

d.    escrow instructions; and                          

       e.    any and all documents necessary to effect the transfer of
property.                                   

    10.   The modification or amendment of escrow agreements established for
        repairs to the mortgaged property or reserves for replacement of
personal property.                                      

The undersigned gives said Attorney-in-fact full power and authority to execute 
such instruments and to do and perform all and every act and thing necessary and
proper to carry into effect the power or powers granted by or under this Limited
Power of Attorney as fully as the undersigned might or could do, and hereby does
ratify and confirm to all that said Attorney-in-fact shall be effective as of   
April 25, 2005.                                                                 

This appointment is to be construed and interpreted as a limited power of       
attorney. The enumeration of specific items, rights, acts or powers herein is   
not intended to, nor does it give rise to, and it is not to be construed as a   
general power of attorney.                                                      

Nothing contained herein shall (i) limit in any manner any indemnification      
provided by [HomEq] to the Trustee under the Agreement, or (ii) be construed to 
grant [HomEq] the power to initiate or defend any suit, litigation or proceeding
in the name of Deutsche Bank National Trust Company except as specifically      
provided for herein. If [HomEq] receives any notice of suit, litigation or      
proceeding in the name of Deutsche Bank National Trust Company, then [HomEq]    
shall promptly forward a copy of same to the Trustee.                           

This limited power of attorney is not intended to extend the powers granted to  
[HomEq] under the Agreement or to allow [HomEq] to take any action with respect 
to Mortgages, Deeds of Trust or Mortgage Notes not authorized by the Agreement. 

[HomEq] hereby agrees to indemnify and hold the Trustee and its directors,      
officers, employees and agents harmless from and against any and all            
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever incurred by   
reason or result of or in connection with the exercise by [HomEq] of the powers 
granted to it hereunder. The foregoing indemnity shall survive the termination  
of this Limited Power of Attorney and the Agreement or the earlier resignation  
or removal of the Trustee under the Agreement.                                  

This Limited Power of Attorney is entered into and shall be governed by the laws
of the State of New York, without regard to conflicts of law principles of such 
state.                                                                          

Third parties without actual notice may rely upon the exercise of the power     
granted under this Limited Power of Attorney; and may be satisfied that this    
Limited Power of Attorney shall continue in full force and effect and has not   
been revoked unless an instrument of revocation has been made in writing by the 
undersigned.                                                                    

IN WITNESS WHEREOF, Deutsche Bank National Trust Company, as Trustee has caused 
its corporate seal to be hereto affixed and these presents to be signed and     
acknowledged in its name and behalf by a duly elected and authorized signatory  
this ___________ day of ____________.                                           

                                Deutsche Bank National Trust Company, as Trustee

By:             
                                   ---------------------------------------------
Name:           
Title:          

Acknowledged and Agreed                                                         

[HomEq Servicing Corporation]                                                   

By:                                                                             
------------------------------------                                      
Name:                                                                     
Title:                                                                    

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STATE OF CALIFORNIA                                                             

COUNTY OF ____________                                                          

        On ________________, _____, before me, the undersigned, a Notary
Public in and for said state, personally appeared                               
________________________________ of Deutsche Bank National Trust Company, as    
Trustee for Morgan Stanley ABS Capital I Inc. Trust 2006-NC1 personally known to
me to be the person whose name is subscribed to the within instrument and       
acknowledged to me that he/she executed that same in his/her authorized         
capacity, and that by his/her signature on the instrument the entity upon behalf
of which the person acted and executed the instrument.                          

  WITNESS my hand and official seal.

(SEAL)                          

                                      --------------------------------------
                                      Notary Public, State of California

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JPMorgan Chase Bank, National Association                                       
c/o Chase Home Finance LLC                                                      
10790 Rancho Bernado                                                            
San Diego, California 92127                                                     

HomEq Servicing Corporation                                                     
4837 Watt Avenue                                                                
North Highlands, California 95660-5101                                          

LIMITED POWER OF ATTORNEY                                                       

KNOW ALL MEN BY THESE PRESENTS, that Deutsche Bank National Trust Company, a    
national banking association organized and existing under the laws of the United
States, and having its principal place of business at 1761 East St. Andrew      
Place, Santa Ana, California 92705, as Trustee pursuant to that Morgan Stanley  
ABS Capital I Inc. Trust 2006-1 Pooling and Servicing Agreement, dated as of    
January 1, 2006, among Morgan Stanley ABS Capital I Inc., as Depositor, JPMorgan
Chase Bank, National Association, as a Servicer, HomEq Servicing Corporation, as
Servicer ("HomEq"), NC Capital Corporation, as a responsible party ("NC         
Capital"), and Deutsche Bank National Trust Company, as Trustee, hereby         
constitutes and appoints [JPMorgan] [HomEq], by and through [HomEq's]           
[JPMorgan's] officers, the Trustee's true and lawful Attorney-in-fact, in the   
Trustee's name, place and stead and for the Trustee's benefit, in connection    
with all mortgage loans serviced by [JPMorgan] [HomEq] pursuant to the Agreement
solely for the purpose of performing such acts and executing such documents in  
the name of the Trustee necessary and appropriate to effectuate the following   
enumerated transactions in respect of any of the mortgages or deeds of trust    
(the "Mortgages" and the "Deeds of Trust" respectively) and promissory notes    
secured thereby (the "Mortgage Notes") for which the undersigned is acting as   
Trustee for various certificateholders (whether the undersigned is named therein
as mortgagee or beneficiary or has become mortgagee by virtue of endorsement of 
the Mortgage Note secured by any such Mortgage or Deed of Trust) and for which  
[JPMorgan] [HomEq] is acting as servicer.                                       

This Appointment shall apply only to the following enumerated transactions and  
nothing herein or in the Agreement shall be construed to the contrary:          

  1.    The modification or re-recording of a Mortgage or Deed of Trust,
            where said modification or re-recording is solely for the purpose of
       correcting the Mortgage or Deed of Trust to conform same to the
         original intent of the parties thereto or to correct title errors
           discovered after such title insurance was issued; provided that (i)
       said modification or re-recording, in either instance, does not
     adversely affect the lien of the Mortgage or Deed of Trust as
    insured and (ii) otherwise conforms to the provisions of the
Agreement.                                              

    2.    The subordination of the lien of a Mortgage or Deed of Trust to an
            easement in favor of a public utility company of a government agency
          or unit with powers of eminent domain; this section shall include,
            without limitation, the execution of partial satisfactions/releases,
         partial reconveyances or the execution or requests to trustees to
accomplish same.                                        

  3.    The conveyance of the properties to the mortgage insurer, or the
          closing of the title to the property to be acquired as real estate
owned, or conveyance of title to real estate owned.     

4.    The completion of loan assumption agreements.                 

      5.    The full satisfaction/release of a Mortgage or Deed of Trust or full
          conveyance upon payment and discharge of all sums secured thereby,
           including, without limitation, cancellation of the related Mortgage
Note.                                                   

 6.    The assignment of any Mortgage or Deed of Trust and the related
        Mortgage Note, in connection with the repurchase of the mortgage
loan secured and evidenced thereby.                     

     7.    The full assignment of a Mortgage or Deed of Trust upon payment and
     discharge of all sums secured thereby in conjunction with the
          refinancing thereof, including, without limitation, the assignment
of the related Mortgage Note.                           

   8.    With respect to a Mortgage or Deed of Trust, the foreclosure, the
     taking of a deed in lieu of foreclosure, or the completion of
            judicial or non-judicial foreclosure or termination, cancellation or
          rescission of any such foreclosure, including, without limitation,
any and all of the following acts:                      

           a.    the substitution of trustee(s) serving under a Deed of Trust,
       in accordance with state law and the Deed of Trust;

     b.    the preparation and issuance of statements of breach or
non-performance;                            

     c.    the preparation and filing of notices of default and/or
notices of sale;                            

      d.    the cancellation/rescission of notices of default and/or
notices of sale;                            

e.    the taking of deed in lieu of foreclosure; and    

       f.    the preparation and execution of such other documents and
               performance of such other actions as may be necessary under
            the terms of the Mortgage, Deed of Trust or state law to
               expeditiously complete said transactions in paragraphs 8.a.
through 8.e. above.                         

     9.    With respect to the sale of property acquired through a foreclosure
          or deed-in lieu of foreclosure, including, without limitation, the
execution of the following documentation:               

a.    listing agreements;                               

b.    purchase and sale agreements;                     

           c.    grant/warranty/quit claim deeds or any other deed causing the
              transfer of title of the property to a party contracted to
purchase same;                              

d.    escrow instructions; and                          

       e.    any and all documents necessary to effect the transfer of
property.                                   

    10.   The modification or amendment of escrow agreements established for
        repairs to the mortgaged property or reserves for replacement of
personal property.                                      

            The undersigned gives said Attorney-in-fact full power and authority
to execute such instruments and to do and perform all and every act and thing   
necessary and proper to carry into effect the power or powers granted by or     
under this Limited Power of Attorney as fully as the undersigned might or could 
do, and hereby does ratify and confirm to all that said Attorney-in-fact shall  
be effective as of January 27, 2006.                                            

        This appointment is to be construed and interpreted as a limited
power of attorney. The enumeration of specific items, rights, acts or powers    
herein is not intended to, nor does it give rise to, and it is not to be        
construed as a general power of attorney.                                       

  Nothing contained herein shall (i) limit in any manner any
indemnification provided by [JPMorgan] [HomEq] to the Trustee under the         
Agreement, or (ii) be construed to grant [JPMorgan] [HomEq] the power to        
initiate or defend any suit, litigation or proceeding in the name of Deutsche   
Bank National Trust Company except as specifically provided for herein. If      
[JPMorgan] [HomEq] receives any notice of suit, litigation or proceeding in the 
name of Deutsche Bank National Trust Company or Bankers Trust Company of        
California, N.A., then [JPMorgan] [HomEq] shall promptly forward a copy of same 
to the Trustee.                                                                 

           This limited power of attorney is not intended to extend the powers
granted to [JPMorgan] [HomEq] under the Agreement or to allow [JPMorgan] [HomEq]
to take any action with respect to Mortgages, Deeds of Trust or Mortgage Notes  
not authorized by the Agreement.                                                

          [JPMorgan] [HomEq] hereby agrees to indemnify and hold the Trustee
and its directors, officers, employees and agents harmless from and against any 
and all liabilities, obligations, losses, damages, penalties, actions,          
judgments, suits, costs, expenses or disbursements of any kind or nature        
whatsoever incurred by reason or result of or in connection with the exercise by
[JPMorgan] [HomEq] of the powers granted to it hereunder. The foregoing         
indemnity shall survive the termination of this Limited Power of Attorney and   
the Agreement or the earlier resignation or removal of the Trustee under the    
Agreement.                                                                      

            This Limited Power of Attorney is entered into and shall be governed
by the laws of the State of New York, without regard to conflicts of law        
principles of such state.                                                       

         Third parties without actual notice may rely upon the exercise of
the power granted under this Limited Power of Attorney; and may be satisfied    
that this Limited Power of Attorney shall continue in full force and effect and 
has not been revoked unless an instrument of revocation has been made in writing
by the undersigned.                                                             

            IN WITNESS WHEREOF, Deutsche Bank National Trust Company, as Trustee
has caused its corporate seal to be hereto affixed and these presents to be     
signed and acknowledged in its name and behalf by a duly elected and authorized 
signatory this ___________ day of ____________.                                 

                                Deutsche Bank National Trust Company, as Trustee

By:             
                                   ---------------------------------------------
Name:     
Title:    

Acknowledged and Agreed                                                         

[HomEq Servicing Corporation]                                                   
[JPMorgan Chase Bank, National Association]                                     

By:                                                                             
----------------------------------------                                  
Name:                                                                     
Title:                                                                    

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STATE OF CALIFORNIA                                                             
COUNTY OF ____________                                                          

        On ________________, _____, before me, the undersigned, a Notary
Public in and for said state, personally appeared                               
________________________________ of Deutsche Bank National Trust Company, as    
Trustee for Morgan Stanley Home Equity Loan Trust 2006-1, personally known to me
to be the person whose name is subscribed to the within instrument and          
acknowledged to me that he/she executed that same in his/her authorized         
capacity, and that by his/her signature on the instrument the entity upon behalf
of which the person acted and executed the instrument.                          

  WITNESS my hand and official seal.

(SEAL)                          

                                      --------------------------------------
                                      Notary Public, State of California

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 EXHIBIT P

SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE

The assessment of compliance to be delivered by [the Trustee], [each Servicer]  
and [each Subservicer] shall address, at a minimum, the criteria identified as  
below as "Applicable Servicing Criteria":                                       

                                                        [Enlarge/Download Table]

------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                        APPLICABLE  
                                                                                                                        SERVICING   
                                               SERVICING CRITERIA                                                       CRITERIA    
------------------------------------------------------------------------------------------------------------------------------------
  Reference                                        Criteria                                                                         
------------------------------------------------------------------------------------------------------------------------------------
                                       General Servicing Considerations                                                             
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                    
                   Policies and procedures are instituted to monitor any performance or other triggers and          Trustee/Servicer
1122(d)(1)(i)      events of default in accordance with the transaction agreements.                                                 
------------------------------------------------------------------------------------------------------------------------------------
                   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                      
1122(d)(1)(ii)     servicing activities.                                                                            Trustee/Servicer
------------------------------------------------------------------------------------------------------------------------------------
                   Any requirements in the transaction agreements to maintain a back-up servicer for the                   N/A      
1122(d)(1)(iii)    mortgage loans are maintained.                                                                                   
------------------------------------------------------------------------------------------------------------------------------------
                   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                     
1122(d)(1)(iv)     and otherwise in accordance with the terms of the transaction agreements.                            Servicer    
------------------------------------------------------------------------------------------------------------------------------------
                                                Cash Collection and Administration                                                  
------------------------------------------------------------------------------------------------------------------------------------
                   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                         
1122(d)(2)(i)      other number of days specified in the transaction agreements.                                        Servicer    
------------------------------------------------------------------------------------------------------------------------------------
                   Disbursements made via wire transfer on behalf of an obligor or to an investor are made only     Servicer/Trustee
1122(d)(2)(ii)     by authorized personnel.                                                                                         
------------------------------------------------------------------------------------------------------------------------------------
                   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                             
1122(d)(2)(iii)    specified in the transaction agreements.                                                             Servicer    
------------------------------------------------------------------------------------------------------------------------------------
                   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            Servicer/Trustee
1122(d)(2)(iv)     respect to commingling of cash) as set forth in the transaction agreements.                                      
------------------------------------------------------------------------------------------------------------------------------------
                   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          Servicer/Trustee
1122(d)(2)(v)      Exchange Act.                                                                                                    
------------------------------------------------------------------------------------------------------------------------------------
1122(d)(2)(vi)     Unissued checks are safeguarded so as to prevent unauthorized access.                            Servicer/Trustee
------------------------------------------------------------------------------------------------------------------------------------
                   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      Servicer/Trustee
1122(d)(2)(vii)    of days specified in the transaction agreements.                                                                 
------------------------------------------------------------------------------------------------------------------------------------
                                                Investor Remittances and Reporting                                                  
------------------------------------------------------------------------------------------------------------------------------------
                   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        Servicer/Trustee
1122(d)(3)(i)      the Servicer.                                                                                                    
------------------------------------------------------------------------------------------------------------------------------------
                   Amounts due to investors are allocated and remitted in accordance with timeframes,               Servicer/Trustee
1122(d)(3)(ii)     distribution priority and other terms set forth in the transaction agreements.                                   
------------------------------------------------------------------------------------------------------------------------------------
                   Disbursements made to an investor are posted within two business days to the Servicer's          Servicer/Trustee
1122(d)(3)(iii)    investor records, or such other number of days specified in the transaction agreements.                          
------------------------------------------------------------------------------------------------------------------------------------
                   Amounts remitted to investors per the investor reports agree with cancelled checks, or other     Servicer/Trustee
1122(d)(3)(iv)     form of payment, or custodial bank statements.                                                                   
------------------------------------------------------------------------------------------------------------------------------------
                                                     Pool Asset Administration                                                      
------------------------------------------------------------------------------------------------------------------------------------
                   Collateral or security on mortgage loans is maintained as required by the transaction            Servicer/Trustee
1122(d)(4)(i)      agreements or related mortgage loan documents.                                                                   
------------------------------------------------------------------------------------------------------------------------------------
1122(d)(4)(ii)     Mortgage loan and related documents are safeguarded as required by the transaction agreements        Trustee     
------------------------------------------------------------------------------------------------------------------------------------
                   Any additions, removals or substitutions to the asset pool are made, reviewed and approved       Trustee/Servicer
1122(d)(4)(iii)    in accordance with any conditions or requirements in the transaction agreements.                                 
------------------------------------------------------------------------------------------------------------------------------------
                   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         Servicer    
1122(d)(4)(iv)     with the related mortgage loan documents.                                                                        
------------------------------------------------------------------------------------------------------------------------------------
                   The Servicer's records regarding the mortgage loans agree with the Servicer's records with           Servicer    
1122(d)(4)(v)      respect to an obligor's unpaid principal balance.                                                                
------------------------------------------------------------------------------------------------------------------------------------
                   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                           
1122(d)(4)(vi)     accordance with the transaction agreements and related pool asset documents.                         Servicer    
------------------------------------------------------------------------------------------------------------------------------------
                   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                         
1122(d)(4)(vii)    transaction agreements.                                                                              Servicer    
------------------------------------------------------------------------------------------------------------------------------------
                   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           Servicer    
1122(d)(4)(viii)   deemed temporary (e.g., illness or unemployment).                                                                
------------------------------------------------------------------------------------------------------------------------------------
                   Adjustments to interest rates or rates of return for mortgage loans with variable rates are          Servicer    
1122(d)(4)(ix)     computed based on the related mortgage loan documents.                                                           
------------------------------------------------------------------------------------------------------------------------------------
                   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         Servicer    
1122(d)(4)(x)      in the transaction agreements.                                                                                   
------------------------------------------------------------------------------------------------------------------------------------
                   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           Servicer    
1122(d)(4)(xi)     transaction agreements.                                                                                          
------------------------------------------------------------------------------------------------------------------------------------
                   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                       
1122(d)(4)(xii)    was due to the obligor's error or omission.                                                          Servicer    
------------------------------------------------------------------------------------------------------------------------------------
                   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          Servicer    
1122(d)(4)(xiii)   transaction agreements.                                                                                          
------------------------------------------------------------------------------------------------------------------------------------
                   Delinquencies, charge-offs and uncollectible accounts are recognized and recorded in                 Servicer    
1122(d)(4)(xiv)    accordance with the transaction agreements.                                                                      
------------------------------------------------------------------------------------------------------------------------------------
                   Any external enhancement or other support, identified in Item 1114(a)(1) through (3) or Item          Trustee    
1122(d)(4)(xv)     1115 of Regulation AB, is maintained as set forth in the transaction agreements.                                 
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 EXHIBIT Q

 ADDITIONAL FORM 10-D DISCLOSURE

                                                        [Enlarge/Download Table]


                   Item on Form 10-D                                                      Party Responsible                         
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                    
              Item 1: Distribution and Pool                                                   Servicer                              
                 Performance Information                                                      Trustee                               

         Any information required by Item 1121 of                                                                                   
               Regulation AB which is NOT                                                                                           
            included on the Monthly Statement                                                                                       
------------------------------------------------------------------------------------------------------------------------------------
                Item 2: Legal Proceedings                          (i) All parties to the Agreement (as to themselves), (ii) the    
                                                                   Trustee and Servicer as to the issuing entity, (iii) the         
              per Item 1117 of Regulation AB                       Depositor as to the sponsor, and each Originator (other than a   
                                                                   Responsible Party) or any Regulation AB Item 1100(d)(1) party    
------------------------------------------------------------------------------------------------------------------------------------
     Item 3: Sale of Securities and Use of Proceeds                                            Depositor                            
------------------------------------------------------------------------------------------------------------------------------------
       Item 4: Defaults Upon Senior Securities                                                  Trustee                             
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Item 5: Submission of Matters to a Vote of Security Holders        Depositor or the party to this Agreement submitting such matter  
                                                                                     to a vote of Certificateholders                
------------------------------------------------------------------------------------------------------------------------------------
      Item 6: Significant Obligors of Pool Assets                                                  N/A                              
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    Item 7: Significant Enhancement Provider Information                                        Depositor                           
------------------------------------------------------------------------------------------------------------------------------------
                 Item 8: Other Information                         Any party to the Agreement responsible for disclosure items      
                                                                                                 on Form 8-K                        
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                   Item 9: Exhibits                                                               Trustee                           
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 EXHIBIT R

 ADDITIONAL FORM 10-K DISCLOSURE

                                                        [Enlarge/Download Table]


             Item on Form 10-K                                                 Party Responsible                                    
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     Item 1B: Unresolved Staff Comments                                           Depositor                                         
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         Item 9B: Other Information                     Any party to the Agreement responsible for disclosure items on Form 8-K     
------------------------------------------------------------------------------------------------------------------------------------
Item 15: Exhibits, Financial Statement Schedules                                    Trustee                                         
                                                                                   Depositor                                        
------------------------------------------------------------------------------------------------------------------------------------
              Additional Item:                    (i) All parties to the Agreement (as to themselves), (ii) the Trustee and Servicer
                                                   as to the Trust, (iii) the Depositor as to the sponsor and each Originator (other
 Disclosure per Item 1117 of Regulation AB                        than a Responsible Party), or any 1100(d)(1) party                
------------------------------------------------------------------------------------------------------------------------------------
              Additional Item:                      (i) All parties to the Agreement as to themselves, (ii) the Depositor as to the 
 Disclosure per Item 1119 of Regulation AB                             sponsor, or any derivative provider                          
------------------------------------------------------------------------------------------------------------------------------------
              Additional Item:                                                       N/A                                            
Disclosure per Item 1112(b) of Regulation AB                                                                                        
------------------------------------------------------------------------------------------------------------------------------------
              Additional Item:                                                     Depositor                                        
Disclosure per Items 1114(b) and 1115(b)                                                                                            
            of Regulation AB                                                                                                        
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 EXHIBIT S

 FORM 8-K DISCLOSURE INFORMATION

                                                        [Enlarge/Download Table]


                                 Item on Form 8-K                                                      Party Responsible            
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                    
              Item 1.01- Entry into a Material Definitive Agreement                   The party to this Agreement entering into such
                                                                                                 material definitive agreement      
------------------------------------------------------------------------------------------------------------------------------------
            Item 1.02- Termination of a Material Definitive Agreement                       The party to this Agreement requesting  
                                                                                                    termination of a material       
                                                                                                      definitive agreement          
------------------------------------------------------------------------------------------------------------------------------------
                      Item 1.03- Bankruptcy or Receivership                                                Depositor                
------------------------------------------------------------------------------------------------------------------------------------
   Item 2.04- Triggering Events that Accelerate or Increase a Direct Financial                         Depositor/Trustee            
         Obligation or an Obligation under an Off-Balance Sheet Arrangement                                                         
------------------------------------------------------------------------------------------------------------------------------------
         Item 3.03- Material Modification to Rights of Security Holders                     The party requesting such modification  
------------------------------------------------------------------------------------------------------------------------------------
 Item 5.03- Amendments of Articles of Incorporation or Bylaws; Change of Fiscal                            Depositor                
                                        Year                                                                                        
------------------------------------------------------------------------------------------------------------------------------------
             Item 6.01- ABS Informational and Computational Material                                       Depositor                
------------------------------------------------------------------------------------------------------------------------------------
                    Item 6.02- Change of Servicer or Trustee                                           Servicers, Trustee           
------------------------------------------------------------------------------------------------------------------------------------
           Item 6.03- Change in Credit Enhancement or External Support                                 Depositor/Trustee            
------------------------------------------------------------------------------------------------------------------------------------
               Item 6.04- Failure to Make a Required Distribution                                           Trustee                 
------------------------------------------------------------------------------------------------------------------------------------
                  Item 6.05- Securities Act Updating Disclosure                                            Depositor                
------------------------------------------------------------------------------------------------------------------------------------
                       Item 7.01- Regulation FD Disclosure                                                 Depositor                
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                                    Item 8.01                                                              Depositor                
------------------------------------------------------------------------------------------------------------------------------------
                                    Item 9.01                                                              Depositor                
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 EXHIBIT T

INTEREST RATE SWAP AGREEMENT

(Multicurrency -- Cross Border)                                                 

 ISDA(R)
International Swap Dealers Association, Inc.

MASTER AGREEMENT

dated as of ............

...................................... and .................................... 

have entered and/or anticipate entering into one or more transactions (each a   
"Transaction") that are or will be governed by this Master Agreement, which     
includes the schedule (the "Schedule"), and the documents and other confirming  
evidence (each a "Confirmation") exchanged between the parties confirming those 
Transactions.                                                                   

Accordingly, the parties agree as follows: --                                   

1.    Interpretation                                                            

(a) Definitions. The terms defined in Section 14 and in the Schedule will have  
the meanings therein specified for the purpose of this Master Agreement.        

(b) Inconsistency. In the event of any inconsistency between the provisions of  
the Schedule and the other provisions of this Master Agreement, the Schedule    
will prevail. In the event of any inconsistency between the provisions of any   
Confirmation and this Master Agreement (including the Schedule), such           
Confirmation will prevail for the purpose of the relevant Transaction.          

(c) Single Agreement. All Transactions are entered into in reliance on the fact 
that this Master Agreement and all Confirmations form a single agreement between
the parties (collectively referred to as this "Agreement"), and the parties     
would not otherwise enter into any Transactions.                                

2.    Obligations                                                   

(a) General Conditions.                                                         

 (i)   Each party will make each payment or delivery specified in each
         Confirmation to be made by it, subject to the other provisions of
this Agreement.                                         

      (ii)  Payments under this Agreement will be made on the due date for value
          on that date in the place of the account specified in the relevant
       Confirmation or otherwise pursuant to this Agreement, in freely
          transferable funds and in the manner customary for payments in the
          required currency. Where settlement is by delivery (that is, other
           than by payment), such delivery will be made for receipt on the due
       date in the manner customary for the relevant obligation unless
        otherwise specified in the relevant Confirmation or elsewhere in
this Agreement.                                         

   (iii) Each obligation of each party under Section 2(a)(i) is subject to
         (1) the condition precedent that no Event of Default or Potential
            Event of Default with respect to the other party has occurred and is
         continuing, (2) the condition precedent that no Early Termination
        Date in respect of the relevant Transaction has occurred or been
      effectively designated and (3) each other applicable condition
precedent specified in this Agreement.                  

(b) Change of Account. Either party may change its account for receiving a      
payment or delivery by giving notice to the other party at least five Local     
Business Days prior to the scheduled date for the payment or delivery to which  
such change applies unless such other party gives timely notice of a reasonable 
objection to such change.                                                       

(c) Netting. If on any date amounts would otherwise be payable:--               

(i) in the same currency; and                                   

(ii) in respect of the same Transaction,                        

by each party to the other, then, on such date, each party's obligation to make 
payment of any such amount will be automatically satisfied and discharged and,  
if the aggregate amount that would otherwise have been payable by one party     
exceeds the aggregate amount that would otherwise have been payable by the other
party, replaced by an obligation upon the party by whom the larger aggregate    
amount would have been payable to pay to the other party the excess of the      
larger aggregate amount over the smaller aggregate amount.                      

The parties may elect in respect of two or more Transactions that a net amount  
will be determined in respect of all amounts payable on the same date in the    
same currency in respect of such Transactions, regardless of whether such       
amounts are payable in respect of the same Transaction. The election may be made
in the Schedule or a Confirmation by specifying that subparagraph (ii) above    
will not apply to the Transactions identified as being subject to the election, 
together with the starting date (in which case subparagraph (ii) above will not,
or will cease to, apply to such Transactions from such date). This election may 
be made separately for different groups of Transactions and will apply          
separately to each pairing of Offices through which the parties make and receive
payments or deliveries.                                                         

(d) Deduction or Withholding for Tax.                                           

      (i)   Gross-Up. All payments under this Agreement will be made without any
         deduction or withholding for or on account of any Tax unless such
      deduction or withholding is required by any applicable law, as
     modified by the practice of any relevant governmental revenue
         authority, then in effect. If a party is so required to deduct or
withhold, then that party ("X") will:--                 

                  (1) promptly notify the other party ("Y") of such requirement;

                (2) pay to the relevant authorities the full amount required
                  to be deducted or withheld (including the full amount required
                 to be deducted or withheld from any additional amount paid by
                X to Y under this Section 2(d)) promptly upon the earlier of
                 determining that such deduction or withholding is required or
                  receiving notice that such amount has been assessed against Y;

                 (3) promptly forward to Y an official receipt (or a certified
             copy), or other documentation reasonably acceptable to Y,
    evidencing such payment to such authorities; and

                  (4) if such Tax is an Indemnifiable Tax, pay to Y, in addition
              to the payment to which Y is otherwise entitled under this
               Agreement, such additional amount as is necessary to ensure
                 that the net amount actually received by Y (free and clear of
              Indemnifiable Taxes, whether assessed against X or Y) will
           equal the full amount Y would have received had no such
                  deduction or withholding been required. However, X will not be
                 required to pay any additional amount to Y to the extent that
  it would not be required to be paid but for:--

                  (A) the failure by Y to comply with or perform any
                    agreement contained in Section 4(a)(i), 4(a)(iii) or
4(d); or                        

                      (B) the failure of a representation made by Y pursuant
                   to Section 3(f) to be accurate and true unless such
                      failure would not have occurred but for (I) any action
                     taken by a taxing authority, or brought in a court of
                       competent jurisdiction, on or after the date on which a
                       Transaction is entered into (regardless of whether such
                     action is taken or brought with respect to a party to
            this Agreement) or (II) a Change in Tax Law.

(ii)  Liability. If: --                                             

            (1) X is required by any applicable law, as modified by the practice
   of any relevant governmental revenue authority, to make any
            deduction or withholding in respect of which X would not be required
  to pay an additional amount to Y under Section 2(d)(i)(4);

(2) X does not so deduct or withhold; and               

            (3) a liability resulting from such Tax is assessed directly against
X,                                                      

      then, except to the extent Y has satisfied or then satisfies the liability
resulting from such Tax, Y will promptly pay to X the amount of such
      liability (including any related liability for interest, but including any
  related liability for penalties only if Y has failed to comply with or
   perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d)).

(e) Default Interest; Other Amounts. Prior to the occurrence or effective       
designation of an Early Termination Date in respect of the relevant Transaction,
a party that defaults in the performance of any payment obligation will, to the 
extent permitted by law and subject to Section 6(c), be required to pay interest
(before as well as after judgment) on the overdue amount to the other party on  
demand in the same currency as such overdue amount, for the period from (and    
including) the original due date for payment to (but excluding) the date of     
actual payment, at the Default Rate. Such interest will be calculated on the    
basis of daily compounding and the actual number of days elapsed. If, prior to  
the occurrence or effective designation of an Early Termination Date in respect 
o-f the relevant Transaction, a party defaults in the performance of any        
obligation required to be settled by delivery, it will compensate the other     
party on demand if and to the extent provided for in the relevant Confirmation  
or elsewhere in this Agreement.                                                 

3.    Representations                                                           

Each party represents to the other party (which representations will be deemed  
to be repeated by each party on each date on which a Transaction is entered into
and, in the case of the representations in Section 3(f), at all times until the 
termination of this Agreement) that:--                                          

(a) Basic Representations.                                                      

   (i) Status. It is duly organised and validly existing under the laws of
  the jurisdiction of its organisation or incorporation and, if relevant
under such laws, in good standing;                                  

 (ii) Powers. It has the power to execute this Agreement and any other
documentation relating to this Agreement to which it is a party, to 
deliver this Agreement and any other documentation relating to this 
     Agreement that it is required by this Agreement to deliver and to perform
     its obligations under this Agreement and any obligations it has under any
      Credit Support Document to which it is a party and has taken all necessary
action to authorise such execution, delivery and performance;       

    (iii) No Violation or Conflict. Such execution, delivery and performance
      do not violate or conflict with any law applicable to it, any provision of
     its constitutional documents, any order or judgment of any court or other
agency of government applicable to it or any of its assets or any   
    contractual restriction binding on or affecting it or any of its assets;

   (iv) Consents. All governmental and other consents that are required to
 have been obtained by it with respect to this Agreement or any Credit
      Support Document to which it is a party have been obtained and are in lull
force and effect and all conditions of any such consents have been  
complied with; and                                                  

 (v) Obligations Binding. Its obligations under this Agreement and any
      Credit Support Document to which it is a party constitute its legal, valid
    and binding obligations, enforceable in accordance with their respective
terms (subject to applicable bankruptcy, reorganization, insolvency,
moratorium or similar laws affecting creditors' rights generally and
subject, as to enforceability, to equitable principles of general   
    application (regardless of whether enforcement is sought in a proceeding
in equity or at law)).                                              

(b) Absence of Certain Events. No Event of Default or Potential Event of Default
or, to its knowledge, Termination Event with respect to it has occurred and is  
continuing and no such event or circumstance would occur as a result of its     
entering into or performing its obligations under this Agreement or any Credit  
Support Document to which it is a party.                                        

(c) Absence of Litigation. There is not pending or, to its knowledge, threatened
against it or any of its Affiliates any action, suit or proceeding at law or in 
equity or before any court, tribunal, governmental body, agency or official or  
any arbitrator that is likely to affect the legality, validity or enforceability
against it of this Agreement or any Credit Support Document to which it is a    
party or its ability to perform its obligations under this Agreement or such    
Credit Support Document.                                                        

(d) Accuracy of Specified Information. All applicable information that is       
furnished in writing by or on behalf of it to the other party and is identified 
for the purpose of this Section 3(d) in the Schedule is, as of the date of the  
information, true, accurate and complete in every material respect.             

(e) Payer Tax Representation. Each representation specified in the Schedule as  
being made by it for the purpose of this Section 3(e) is accurate and true.     

(f) Payee Tax Representations. Each representation specified in the Schedule as 
being made by it for the purpose of this Section 3(f) is accurate and true.     

4.    Agreements                                                                

Each party agrees with the other that, so long as either party has or may have  
any obligation under this Agreement or under any Credit Support Document to     
which it is a party:--                                                          

(a) Furnish Specified Information. It will deliver to the other party or, in    
certain cases under subparagraph (iii) below, to such government or taxing      
authority as the other party reasonably directs:--                              

      (i) any forms, documents or certificates relating to taxation specified in
the Schedule or any Confirmation;                                   

   (ii) any other documents specified in the Schedule or any Confirmation;
      and (iii) upon reasonable demand by such other party, any form or document
     that may be required or reasonably requested in writing in order to allow
   such other party or its Credit Support Provider to make a payment under
this Agreement or any applicable Credit Support Document without any
deduction or withholding for or on account of any Tax or with such  
  deduction or withholding at a reduced rate (so long as the completion,
 execution or submission of such form or document would not materially
      prejudice the legal or commercial position of the party in receipt of such
     demand), with any such form or document to be accurate and completed in a
     manner reasonably satisfactory to such other party and to be executed and
to be delivered with any reasonably required certification,         

in each case by the date specified in the Schedule or such Confirmation or, if  
none is specified, as soon as reasonably practicable.                           

(b) Maintain Authorisations. It will use all reasonable efforts to maintain in  
full force and effect all consents of any governmental or other authority that  
are required to be obtained by it with respect to this Agreement or any Credit  
Support Document to which it is a party and will use all reasonable efforts to  
obtain any that may become necessary in the future.                             

(c) Comply with Laws. It will comply in all material respects with all          
applicable laws and orders to which it may be subject if failure so to comply   
would materially impair its ability to perform its obligations under this       
Agreement or an Credit Support Document to which it is a party.                 

(d) Tax Agreement. It will give notice of any failure of a representation made  
by it under Section 3(f) to be accurate and true promptly upon learning of such 
failure.                                                                        

(e) Payment of Stamp Tax. Subject to Section 11, it will pay any Stamp Tax      
levied or imposed upon it or in respect of its execution or performance of this 
Agreement by a jurisdiction in which it is incorporated, organised, managed and 
controlled, or considered to have its seat, or in which a branch or office      
through which it is acting for the purpose of this Agreement is located ("Stamp 
Tax Jurisdiction") and will indemnify the other party against any Stamp Tax     
levied or imposed upon the other party or in respect of the other party's       
execution or performance of this Agreement by any such Stamp Tax Jurisdiction   
which is not also a Stamp Tax Jurisdiction with respect to the other party.     

5.    Events of Default and Termination Events                                  

(a) Events of Default. The occurrence at any time with respect to a party or, if
applicable, any Credit Support Provider of such party or any Specified Entity of
such party of any of the following events constitutes an event of default (an   
"Event of Default") with respect to such party:--                               

      (i) Failure to Pay or Deliver. Failure by the party to make, when due, any
  payment under this Agreement or delivery under Section 2(a)(i) or 2(e)
      required to be made by it if such failure is not remedied on or before the
 third Local Business Day after notice of such failure is given to the
party;                                                              

    (ii) Breach of Agreement. Failure by the party to comply with or perform
     any agreement or obligation (other than an obligation to make any payment
     under this Agreement or delivery under Section 2(a)(i) or 2(e) or to give
      notice of a Termination Event or any agreement or obligation under Section
     4(a)(i), 4(a)(iii) or 4(d)) to be complied with or performed by the party
   in accordance with this Agreement if such failure is not remedied on or
 before the thirtieth day after notice of such failure is given to the
party;                                                              

(iii) Credit Support Default.                                       

       (1) Failure by the party or any Credit Support Provider of such
         party to comply with or perform any agreement or obligation to be
      complied with or performed by it in accordance with any Credit
           Support Document if such failure is continuing after any applicable
grace period has elapsed;                               

            (2) the expiration or termination of such Credit Support Document or
            the failing or ceasing of such Credit Support Document to be in full
          force and effect for the purpose of this Agreement (in either case
          other than in accordance with its terms) prior to the satisfaction
        of all obligations of such party under each Transaction to which
           such Credit Support Document relates without the written consent of
the other party; or                                     

            (3) the party or such Credit Support Provider disaffirms, disclaims,
     repudiates or rejects, in whole or in part, or challenges the
validity of such Credit Support Document;               

 (iv) Misrepresentation. A representation (other than a representation
      under Section 3(e) or (f)) made or repeated or deemed to have been made or
      repeated by the party or any Credit Support Provider of such party in this
     Agreement or any Credit Support Document proves to have been incorrect or
      misleading in any material respect when made or repeated or deemed to have
been made or repeated;                                              

  (v) Default under Specified Transaction. The party, any Credit Support
   Provider of such party or any applicable Specified Entity of such party
      (1) defaults under a Specified Transaction and, after giving effect to any
     applicable notice requirement or grace period, there occurs a liquidation
      of, an acceleration of obligations under, or an early termination of, that
      Specified Transaction, (2) defaults, after giving effect to any applicable
     notice requirement or grace period, in making any payment or delivery due
      on the last payment, delivery or exchange date of, or any payment on early
     termination of, a Specified Transaction (or such default continues for at
least three Local Business Days if there is no applicable notice    
    requirement or grace period) or (3) disaffirms, disclaims, repudiates or
    rejects, in whole or in part, a Specified Transaction (or such action is
     taken by any person or entity appointed or empowered to operate it or act
on its behalf);                                                     

  (vi) Cross Default. If "Cross Default" is specified in the Schedule as
      applying to the party, the occurrence or existence of (1) a default, event
 of default or other similar condition or event (however described) in
   respect of such party, any Credit Support Provider of such party or any
     applicable Specified Entity of such party under one or more agreements or
instruments relating to Specified Indebtedness of any of them       
      (individually or collectively) in an aggregate amount of not less than the
applicable Threshold Amount (as specified in the Schedule) which has
    resulted in such Specified Indebtedness becoming, or becoming capable at
 such time of being declared, due and payable under such agreements or
     instruments, before it would otherwise have been due and payable or (2) a
 default by such party, such Credit Support Provider or such Specified
   Entity (individually or collectively) in making one or more payments on
the due date thereof in an aggregate amount of not less than the    
   applicable Threshold Amount under such agreements or instruments (after
giving effect to any applicable notice requirement or grace period);

     (vii) Bankruptcy. The party, any Credit Support Provider of such party or
any applicable Specified Entity of such party:--                    

 (1) is dissolved (other than pursuant to a consolidation,
          amalgamation or merger); (2) becomes insolvent or is unable to pay
          its debts or fails or admits in writing its inability generally to
         pay its debts as they become due; (3) makes a general assignment,
            arrangement or composition with or for the benefit of its creditors;
          (4) institutes or has instituted against it a proceeding seeking a
          judgment of insolvency or bankruptcy or any other relief under any
   bankruptcy or insolvency law or other similar law affecting
           creditors' rights, or a petition is presented for its winding-up or
        liquidation, and, in the case of any such proceeding or petition
           instituted or presented against it, such proceeding or petition (A)
            results in a judgment of insolvency or bankruptcy or the entry of an
        order for relief or the making of an order for its winding-up or
  liquidation or (B) is not dismissed, discharged, stayed or
    restrained in each case within 30 days of the institution or
 presentation thereof; (5) has a resolution passed for its
           winding-up, official management or liquidation (other than pursuant
         to a consolidation, amalgamation or merger); (6) seeks or becomes
   subject to the appointment of an administrator, provisional
      liquidator, conservator, receiver, trustee, custodian or other
           similar official for it or for all or substantially all its assets;
           (7) has a secured party take possession of all or substantially all
          its assets or has a distress, execution, attachment, sequestration
            or other legal process levied, enforced or sued on or against all or
     substantially all its assets and such secured party maintains
            possession, or any such process is not dismissed, discharged, stayed
            or restrained, in each case within 30 days thereafter; (8) causes or
   is subject to any event with respect to it which, under the
           applicable laws of any jurisdiction, has an analogous effect to any
         of the events specified in clauses (1) to (7) (inclusive); or (9)
         takes any action in furtherance of, or indicating its consent to,
      approval of, or acquiescence in, any of the foregoing acts; or

      (viii) Merger Without Assumption. The party or any Credit Support Provider
      of such party consolidates or amalgamates with, or merges with or into, or
    transfers all or substantially all its assets to, another entity and, at
the time of such consolidation, amalgamation, merger or transfer:-- 

         (1) the resulting, surviving or transferee entity fails to assume
         all the obligations of such party or such Credit Support Provider
          under this Agreement or any Credit Support Document to which it or
         its predecessor was a party by operation of law or pursuant to an
    agreement reasonably satisfactory to the other party to this
Agreement; or                                           

      (2) the benefits of any Credit Support Document fail to extend
           (without the consent of the other party) to the performance by such
          resulting, surviving or transferee entity of its obligations under
this Agreement.                                         

(b) Termination Events. The occurrence at any time with respect to a party or,  
if applicable, any Credit Support Provider of such party or any Specified Entity
of such party of any event specified below constitutes an Illegality if the     
event is specified in (i) below, a Tax Event if the event is specified in (ii)  
below or a Tax Event Upon Merger if the event is specified in (iii) below, and, 
if specified to be applicable, a Credit Event Upon Merger if the event is       
specified pursuant to (iv) below or an Additional Termination Event if the event
is specified pursuant to (v) below:--                                           

    (i) Illegality. Due to the adoption of, or any change in, any applicable
    law after the date on which a Transaction is entered into, or due to the
promulgation of, or any change in, the interpretation by any court, 
tribunal or regulatory authority with competent jurisdiction of any 
applicable law after such date, it becomes unlawful (other than as a
  result of a breach by the party of Section 4(b)) for such party (which
will be the Affected Party): --                                     

      (1) to perform any absolute or contingent obligation to make a
          payment or delivery or to receive a payment or delivery in respect
          of such Transaction or to comply with any other material provision
of this Agreement relating to such Transaction; or      

           (2) to perform, or for any Credit Support Provider of such party to
            perform, any contingent or other obligation which the party (or such
      Credit Support Provider) has under any Credit Support Document
relating to such Transaction;                           

 (ii) Tax Event. Due to (x) any action taken by a taxing authority, or
 brought in a court of competent jurisdiction, on or after the date on
     which a Transaction is entered into (regardless of whether such action is
taken or brought with respect to a party to this Agreement) or (y) a
    Change in Tax Law, the party (which will be the Affected Party) will, or
  there is a substantial likelihood that it will, on the next succeeding
Scheduled Payment Date (1) be required to pay to the other party an 
additional amount in respect of an Indemnifiable Tax under Section  
     2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or
 6(e)) or (2) receive a payment from which an amount is required to be
 deducted or withheld for or on account of a Tax (except in respect of
      interest under Section 2(e), 6(d)(ii) or 6(e)) and no additional amount is
      required to be paid in respect of such Tax under Section 2(d)(i)(4) (other
than by reason of Section 2(d)(i)(4)(A) or (B));                    

     (iii) Tax Event Upon Merger. The party (the "Burdened Party") on the next
   succeeding Scheduled Payment Date will either (1) be required to pay an
additional amount in respect of an Indemnifiable Tax under Section  
     2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or
    6(e)) or (2) receive a payment from which an amount has been deducted or
   withheld for or on account of any Indemnifiable Tax in respect of which
      the other party is not required to pay an additional amount (other than by
    reason of Section 2(d)(i)(4)(A) or (B)), in either case as a result of a
 party consolidating or amalgamating with, or merging with or into, or
      transferring all or substantially all its assets to, another entity (which
      will be the Affected Party) where such action does not constitute an event
described in Section 5(a)(viii);                                    

     (iv) Credit Event Upon Merger. If "Credit Event Upon Merger" is specified
  in the Schedule as applying to the party, such party ("X"), any Credit
      Support Provider of X or any applicable Specified Entity of X consolidates
or amalgamates with, or merges with or into, or transfers all or    
    substantially all its assets to, another entity and such action does not
constitute an event described in Section 5(a)(viii) but the         
creditworthiness of the resulting, surviving or transferee entity is
  materially weaker than that of X, such Credit Support Provider or such
  Specified Entity, as the case may be, immediately prior to such action
  (and, in such event, X or its successor or transferee, as appropriate,
will be the Affected Party); or                                     

      (v) Additional Termination Event. If any "Additional Termination Event" is
     specified in the Schedule or any Confirmation as applying, the occurrence
     of such event (and, in such event, the Affected Party or Affected Parties
shall be as specified for such Additional Termination Event in the  
Schedule or such Confirmation).                                     

(c) Event of Default and Illegality. If an event or circumstance which would    
otherwise constitute or give rise to an Event of Default also constitutes an    
Illegality, it will be treated as an Illegality and will not constitute an Event
of Default.                                                                     

6.    Early Termination                                                         

(a) Right to Terminate Following Event of Default. If at any time an Event of   
Default with respect to a party (the "Defaulting Party") has occurred and is    
then continuing, the other party (the "Non-defaulting Party") may, by not more  
than 20 days notice to the Defaulting Party specifying the relevant Event of    
Default, designate a day not earlier than the day such notice is effective as an
Early Termination Date in respect of all outstanding Transactions. If, however, 
"Automatic Early Termination" is specified in the Schedule as applying to a     
party, then an Early Termination Date in respect of all outstanding transactions
will occur immediately upon the occurrence with respect to such party of an     
Event of Default specified in Section 5(a)(vii)(1), (3), (5), (6) or, to the    
extent analogous thereto, (8), and as of the time immediately preceding the     
institution of the relevant proceeding or the presentation of the relevant      
petition upon the occurrence with respect to such party of an Event of Default  
specified in Section 5(a)(vii)(4) or, to the extent analogous thereto, (8).     

(b) Right to Terminate Following Termination Event.                             

(i) Notice. If a Termination Event occurs, an Affected Party will,  
      promptly upon becoming aware of it, notify the other party, specifying the
   nature of that Termination Event and each Affected Transaction and will
      also give such other information about that Termination Event as the other
party may reasonably require.                                       

   (ii) Transfer to Avoid Termination Event. If either an Illegality under
   Section 5(b)(i)(1) or a Tax Event occurs and there is only one Affected
     Party, or if a Tax Event Upon Merger occurs and the Burdened Party is the
   Affected Party, the Affected Party will, as a condition to its right to
designate an Early Termination Date under Section 6(b)(iv), use all 
  reasonable efforts (which will not require such party to incur a loss,
 excluding immaterial, incidental expenses) to transfer within 20 days
      after it gives notice under Section 6(b)(i) all its rights and obligations
      under this Agreement in respect of the Affected Transactions to another of
     its Offices or Affiliates so that such Termination Event ceases to exist.

  If the Affected Party is not able to make such a transfer it will give
notice to the other party to that effect within such 20 day period, 
     whereupon the other party may effect such a transfer within 30 days after
the notice is given under Section 6(b)(i).                          

    Any such transfer by a party under this Section 6(b)(ii) will be subject
 to and conditional upon the prior written consent of the other party,
which consent will not be withheld if such other party's policies in
   effect at such time would permit it to enter into transactions with the
transferee on the terms proposed.                                   

      (iii) Two Affected Parties. If an Illegality under Section 5(b)(i)(1) or a
    Tax Event occurs and there are two Affected Parties, each party will use
 all reasonable efforts to reach agreement within 30 days after notice
      thereof is given under Section 6(b)(i) on action to avoid that Termination
Event.                                                              

(iv) Right to Terminate. If: --                                     

           (1) a transfer under Section 6(b)(ii) or an agreement under Section
            6(b)(iii), as the case may be, has not been effected with respect to
        all Affected Transactions within 30 days after an Affected Party
gives notice under Section 6(b)(i); or                  

       (2) an Illegality under Section 5(b)(i)(2), a Credit Event Upon
        Merger or an Additional Termination Event occurs, or a Tax Event
            Upon Merger occurs and the Burdened Party is not the Affected Party,

     either party in the case of an Illegality, the Burdened Party in the case
     of a Tax Event Upon Merger, any Affected Party in the case of a Tax Event
 or an Additional Termination Event if there is more than one Affected
Party, or the party which is not the Affected Party in the case of a
   Credit Event Upon Merger or an Additional Termination Event if there is
     only one Affected Party may, by not more than 20 days notice to the other
      party and provided that the relevant Termination Event is then continuing,
   designate a day not earlier than the day such notice is effective as an
Early Termination Date in respect of all Affected Transactions.     

(c) Effect of Designation.                                                      

      (i) If notice designating an Early Termination Date is given under Section
6(a) or (b), the Early Termination Date will occur on the date so   
   designated, whether or not the relevant Event of Default or Termination
Event is then continuing.                                           

     (ii) Upon the occurrence or effective designation of an Early Termination
    Date, no further payments or deliveries under Section 2(a)(i) or 2(e) in
   respect of the Terminated Transactions will be required to be made, but
    without prejudice to the other provisions of this Agreement. The amount,
if any, payable in respect of an Early Termination Date shall be    
determined pursuant to Section 6(e).                                

(d) Calculations.                                                               

(i) Statement. On or as soon as reasonably practicable following the
occurrence of an Early Termination Date, each party will make the   
   calculations on its part, if any, contemplated by Section 6(e) and will
     provide to the other party a statement (1) showing, in reasonable detail,
   such calculations (including all relevant quotations and specifying any
     amount payable under Section 6(e)) and (2) giving details of the relevant
      account to which any amount payable to it is to be paid. In the absence of
written confirmation from the source of a quotation obtained in     
   determining a Market Quotation, the records of the party obtaining such
  quotation will be conclusive evidence of the existence and accuracy of
such quotation.                                                     

  (ii) Payment Date. An amount calculated as being due in respect of any
     Early Termination Date under Section 6(e) will be payable on the day that
notice of the amount payable is effective (in the case of an Early  
     Termination Date which is designated or occurs as a result of an Event of
     Default) and on the day which is two Local Business Days after the day on
    which notice of the amount payable is effective (in the case of an Early
     Termination Date which is designated as a result of a Termination Event).
 Such amount will be paid together with (to the extent permitted under
      applicable law) interest thereon (before as well as after judgment) in the
     Termination Currency, from (and including) the relevant Early Termination
   Date to (but excluding) the date such amount is paid, at the Applicable
    Rate. Such interest will be calculated on the basis of daily compounding
and the actual number of days elapsed.                              

(e) Payments on Early Termination. If an Early Termination Date occurs, the     
following provisions shall apply based on the parties' election in the Schedule 
of a payment measure, either "Market Quotation" or "Loss", and a payment method,
either the "First Method" or the "Second Method". If the parties fail to        
designate a payment measure or payment method in the Schedule, it will be deemed
that "Market Quotation" or the "Second Method", as the case may be, shall apply.
The amount, if any, payable in respect of an Early Termination Date and         
determined pursuant to this Section will be subject to any Set-off.             

      (i) Events of Default. If the Early Termination Date results from an Event
of Default: --                                                      

      (1) First Method and Market Quotation. If the First Method and
    Market Quotation apply, the Defaulting Party will pay to the
         Non-defaulting Party the excess, if a positive number, of (A) the
      sum of the Settlement Amount (determined by the Non-defaulting
            Party) in respect of the Terminated Transactions and the Termination
Currency Equivalent of the Unpaid Amounts owing to the  
            Non-defaulting Party over (B) the Termination Currency Equivalent of
the Unpaid Amounts owing to the Defaulting Party.       

          (2) First Method and Loss. If the First Method and Loss apply, the
            Defaulting Party will pay to the Non-defaulting Party, if a positive
  number, the Non-Defaulting Party's Loss in respect of this
Agreement.                                              

        (3) Second Method and Market Quotation. If the Second Method and
          Market Quotation apply, an amount will be payable equal to (A) the
      sum of the Settlement Amount (determined by the Non-defaulting
            Party) in respect of the Terminated Transactions and the Termination
Currency Equivalent of the Unpaid Amounts owing to the  
            Non-defaulting Party less (B) the Termination Currency Equivalent of
           the Unpaid Amounts owing to the Defaulting Party. If that amount is
  a positive number, the Defaulting Party will pay it to the
            Non-defaulting Party; if it is a negative number, the Non-defaulting
          Party will pay the absolute value of that amount to the Defaulting
Party.                                                  

           (4) Second Method and Loss. If the Second Method and Loss apply, an
          amount will be payable equal to the Non-defaulting Party's Loss in
           respect of this Agreement. If that amount is a positive number, the
            Defaulting Party will pay it to the Non-defaulting Party; if it is a
       negative number, the Non-defaulting Party will pay the absolute
value of that amount to the Defaulting Party.           

 (ii) Termination Events. If the Early Termination Date results from a
Termination Event: --                                               

          (1) One Affected Party. If there is one Affected Party, the amount
            payable will be determined in accordance with Section 6(e)(i)(3), if
         Market Quotation applies, or Section 6(e)(i)(4), if Loss applies,
           except that, in either case, references to the Defaulting Party and
          to the Non-defaulting Party will be deemed to be references to the
     Affected Party and the party which is not the Affected Party,
 respectively, and, if Loss applies and fewer than all the
      Transactions are being terminated, Loss shall be calculated in
respect of all Terminated Transactions.                 

       (2) Two Affected Parties. If there are two Affected Parties: --

                (A) if Market Quotation applies, each party will determine a
                Settlement Amount in respect of the Terminated Transactions,
             and an amount will be payable equal to (I) the sum of (a)
               one-half of the difference between the Settlement Amount of
             the party with the higher Settlement Amount ("X") and the
            Settlement Amount of the party with the lower Settlement
               Amount ("Y") and (b) the Termination Currency Equivalent of
           the Unpaid Amounts owing to X less (II) the Termination
             Currency Equivalent of the Unpaid Amounts owing to Y; and

              (B) if Loss applies, each party will determine its Loss in
        respect of this Agreement (or, if fewer than all the
        Transactions are being terminated, in respect of all
                Terminated Transactions) and an amount will be payable equal
               to one-half of the difference between the Loss of the party
                 with the higher Loss ("X") and the Loss of the party with the
lower Loss ("Y").                           

          If the amount payable is a positive number, Y will pay it to X; if
      it is a negative number, X will pay the absolute value of that
amount to Y.                                            

(iii) Adjustment for Bankruptcy. In circumstances where an Early    
    Termination Date occurs because "Automatic Early Termination" applies in
     respect of a party, the amount determined under this Section 6(e) will be
  subject to such adjustments as are appropriate and permitted by law to
   reflect any payments or deliveries made by one party to the other under
    this Agreement (and retained by such other party) during the period from
  the relevant Early Termination Date to the date for payment determined
under Section 6(d)(ii).                                             

    (iv) Pre-Estimate. The parties agree that if Market Quotation applies an
      amount recoverable under this Section 6(e) is a reasonable pre-estimate of
      loss and not a penalty. Such amount is payable for the loss of bargain and
the loss of protection against future risks and except as otherwise 
    provided in this Agreement neither party will be entitled to recover any
additional damages as a consequence of such losses.                 

7.    Transfer                                                                  

Subject to Section 6(b)(ii), neither this Agreement nor any interest or         
obligation in or under this Agreement may be transferred (whether by way of     
security or otherwise) by either party without the prior written consent of the 
other party, except that: --                                                    

(a) a party may make such a transfer of this Agreement pursuant to a            
consolidation or amalgamation with, or merger with or into, or transfer of all  
or substantially all its assets to, another entity (but without prejudice to any
other right or remedy under this Agreement); and                                

(b) a party may make such a transfer of all or any part of its interest in any  
amount payable to it from a Defaulting Party under Section 6(e).                

Any purported transfer that is not in compliance with this Section will be void.

8.    Contractual Currency                                                      

(a) Payment in the Contractual Currency. Each payment under this Agreement will 
be made in the relevant currency specified in this Agreement for that payment   
(the "Contractual Currency"). To the extent permitted by applicable law, any    
obligation to make payments under this Agreement in the Contractual Currency    
will not be discharged or satisfied by any tender in any currency other than the
Contractual Currency, except to the extent such tender results in the actual    
receipt by the party to which payment is owed, acting in a reasonable manner and
in good faith in converting the currency so tendered into the Contractual       
Currency, of the full amount in the Contractual Currency of all amounts payable 
in respect of this Agreement. If for any reason the amount in the Contractual   
Currency so received falls short of the amount in the Contractual Currency      
payable in respect of this Agreement, the party required to make the payment    
will, to the extent permitted by applicable law, immediately pay such additional
amount in the Contractual Currency as may be necessary to compensate for the    
shortfall. If for any reason the amount in the Contractual Currency so received 
exceeds the amount in the Contractual Currency payable in respect of this       
Agreement, the party receiving the payment will refund promptly the amount of   
such excess.                                                                    

(b) Judgments. To the extent permitted by applicable law, if any judgment or    
order expressed in a currency other than the Contractual Currency is rendered   
(i) for the payment of any amount owing in respect of this Agreement, (ii) for  
the payment of any amount relating to any early termination in respect of this  
Agreement or (iii) in respect of a judgment or order of another court for the   
payment of any amount described in (i) or (ii) above, the party seeking         
recovery, after recovery in full of the aggregate amount to which such party is 
entitled pursuant to the judgment or order, will be entitled to receive         
immediately from the other party the amount of any shortfall of the Contractual 
Currency received by such party as a consequence of sums paid in such other     
currency and will refund promptly to the other party any excess of the          
Contractual Currency received by such party as a consequence of sums paid in    
such other currency if such shortfall or such excess arises or results from any 
variation between the rate of exchange at which the Contractual Currency is     
converted into the currency of the judgment or order for the purposes of such   
judgment or order and the rate of exchange at which such party is able, acting  
in a reasonable manner and in good faith in converting the currency received    
into the Contractual Currency, to purchase the Contractual Currency with the    
amount of the currency of the judgment or order actually received by such party.
The term "rate of exchange" includes, without limitation, any premiums and costs
of exchange payable in connection with the purchase of or conversion into the   
Contractual Currency.                                                           

(c) Separate Indemnities. To the extent permitted by applicable law, these      
indemnities constitute separate and independent obligations from the other      
obligations in this Agreement, will be enforceable as separate and independent  
causes of action, will apply notwithstanding any indulgence granted by the party
to which any payment is owed and will not be affected by judgment being obtained
or claim or proof being made for any other sums payable in respect of this      
Agreement.                                                                      

(d) Evidence of Loss. For the purpose of this Section 8, it will be sufficient  
for a party to demonstrate that it would have suffered a loss had an actual     
exchange or purchase been made.                                                 

9.    Miscellaneous                                                             

(a) Entire Agreement. This Agreement constitutes the entire Agreement and       
understanding of the parties with respect to its subject matter and supersedes  
all oral communication and prior writings with respect thereto.                 

(b) Amendments. No amendment, modification or waiver in respect of this         
Agreement will be effective unless in writing (including a writing evidenced by 
a facsimile transmission) and executed by each of the parties or confirmed by an
exchange of telexes or electronic messages on an electronic messaging system.   

(c) Survival of Obligations. Without prejudice to Sections 2(a)(iii) and        
6(c)(ii), the obligations of the parties under this Agreement will survive the  
termination of any Transaction.                                                 

(d) Remedies Cumulative. Except as provided in this Agreement, the rights,      
powers, remedies and privileges provided in this Agreement are cumulative and   
not exclusive of any rights, powers, remedies and privileges provided by law.   

(e) Counterparts and Confirmations.                                             

      (i) This Agreement (and each amendment, modification and waiver in respect
of it) may be executed and delivered in counterparts (including by  
facsimile transmission), each of which will be deemed an original.  

    (ii) The parties intend that they are legally bound by the terms of each
    Transaction from the moment they agree to those terms (whether orally or
   otherwise). A Confirmation shall be entered into as soon as practicable
     and may be executed and delivered in counterparts (including by facsimile
      transmission) or be created by an exchange of telexes or by an exchange of
     electronic messages on an electronic messaging system, which in each case
   will be sufficient for all purposes to evidence a binding supplement to
this Agreement. The parties will specify therein or through another 
  effective means that any such counterpart, telex or electronic message
constitutes a Confirmation.                                         

(f) No Waiver of Rights. A failure or delay in exercising any right, power or   
privilege in respect of this Agreement will not be presumed to operate as a     
waiver, and a single or partial exercise of any right, power or privilege will  
not be presumed to preclude any subsequent or further exercise, of that right,  
power or privilege or the exercise of any other right, power or privilege.      

(g) Headings. The headings used in this Agreement are for convenience of        
reference only and are not to affect the construction of or to be taken into    
consideration in interpreting this Agreement.                                   

10.   Offices; Multibranch Parties                                              

(a) If Section 10(a) is specified in the Schedule as applying, each party that  
enters into a Transaction through an Office other than its head or home office  
represents to the other party that, notwithstanding the place of booking office 
or jurisdiction of incorporation or organisation of such party, the obligations 
of such party are the same as if it had entered into the Transaction through its
head or home office. This representation will be deemed to be repeated by such  
party on each date on which a Transaction is entered into.                      

(b) Neither party may change the Office through which it makes and receives     
payments or deliveries for the purpose of a Transaction without the prior       
written consent of the other party.                                             

(c) If a party is specified as a Multibranch Party in the Schedule, such        
Multibranch Party may make and receive payments or deliveries under any         
Transaction through any Office listed in the Schedule, and the Office through   
which it makes and receives payments or deliveries with respect to a Transaction
will be specified in the relevant Confirmation.                                 

11.   Expenses                                                                  

A Defaulting Party will, on demand, indemnify and hold harmless the other party 
for and against all reasonable out-of-pocket expenses, including legal fees and 
Stamp Tax, incurred by such other party by reason of the enforcement and        
protection of its rights under this Agreement or any Credit Support Document to 
which the Defaulting Party is a party or by reason of the early termination of  
any Transaction, including, but not limited to, costs of collection.            

12.   Notices                                                                   

(a) Effectiveness. Any notice or other communication in respect of this         
Agreement may be given in any manner set forth below (except that a notice or   
other communication under Section 5 or 6 may not be given by facsimile          
transmission or electronic messaging system) to the address or number or in     
accordance with the electronic messaging system details provided (see the       
Schedule) and will be deemed effective as indicated:--                          

      (i) if in writing and delivered in person or by courier, on the date it is
delivered;                                                          

      (ii) if sent by telex, on the date the recipient's answerback is received;
     (iii) if sent by facsimile transmission, on the date that transmission is
   received by a responsible employee of the recipient in legible form (it
     being agreed that the burden of proving receipt will be on the sender and
will not be met by a transmission report generated by the sender's  
facsimile machine);                                                 

      (iv) if sent by certified or registered mail (airmail, if overseas) or the
     equivalent (return receipt requested), on the date that mail is delivered
or its delivery is attempted; or                                    

   (v) if sent by electronic messaging system, on the date that electronic
message is received,                                                

unless the date of that delivery (or attempted delivery) or that receipt, as    
applicable, is not a Local Business Day or that communication is delivered (or  
attempted) or received, as applicable, after the close of business on a Local   
Business Day, in which case that communication shall be deemed given and        
effective on the first following day that is a Local Business Day.              

(b) Change of Addresses. Either party may by notice to the other change the     
address, telex or facsimile number or electronic messaging system details at    
which notices or other communications are to be given to it.                    

13.   Governing Law and Jurisdiction                                            

(a) Governing Law. This Agreement will be governed by and construed in          
accordance with the law specified in the Schedule.                              

(b) Jurisdiction. With respect to any suit, action or proceedings relating to   
this Agreement ("Proceedings"), each party irrevocably:--                       

    (i) submits to the jurisdiction of the English courts, if this Agreement
is expressed to be governed by English law, or to the non-exclusive 
     jurisdiction of the courts of the State of New York and the United States
   District Court located in the Borough of Manhattan in New York City, if
      this Agreement is expressed to be governed by the laws of the State of New
York; and                                                           

    (ii) waives any objection which it may have at any time to the laying of
     venue of any Proceedings brought in any such court, waives any claim that
   such Proceedings have been brought in an inconvenient forum and further
   waives the right to object, with respect to such Proceedings, that such
court does not have any jurisdiction over such party.               

Nothing in this Agreement precludes either party from bringing Proceedings in   
any other jurisdiction (outside, if this Agreement is expressed to be governed  
by English law, the Contracting States, as defined in Section 1(3) of the Civil 
Jurisdiction and Judgments Act 1982 or any modification, extension or           
re-enactment thereof for the time being in force) nor will the bringing of      
Proceedings in any one or more jurisdictions preclude the bringing of           
Proceedings in any other jurisdiction.                                          

(c) Service of Process. Each party irrevocably appoints the Process Agent (if   
any) specified opposite its name in the Schedule to receive, for it and on its  
behalf, service of process in any Proceedings. If for any reason any party's    
Process Agent is unable to act as such, such party will promptly notify the     
other party and within 30 days appoint a substitute process agent acceptable to 
the other party. The parties irrevocably consent to service of process given in 
the manner provided for notices in Section 12. Nothing in this Agreement will   
affect the right of either party to serve process in any other manner permitted 
by law.                                                                         

(d) Waiver of Immunities. Each party irrevocably waives, to the fullest extent  
permitted by applicable law, with respect to itself and its revenues and assets 
(irrespective of their use or intended use), all immunity on the grounds of     
sovereignty or other similar grounds from (i) suit, (ii) jurisdiction of any    
court, (iii) relief by way of injunction, order for specific performance or for 
recovery of property, (iv) attachment of its assets (whether before or after    
judgment) and (v) execution or enforcement of any judgment to which it or its   
revenues or assets might otherwise be entitled in any Proceedings in the courts 
of any jurisdiction and irrevocably agrees, to the extent permitted by          
applicable law, that it will not claim any such immunity in any Proceedings.    

14.   Definitions                                                               

As used in this Agreement:--                                                    

"Additional Termination Event" has the meaning specified in Section 5(b).       

"Affected Party" has the meaning specified in Section 5(b).                     

"Affected Transactions" means (a) with respect to any Termination Event         
consisting of an Illegality, Tax Event or Tax Event Upon Merger, all            
Transactions affected by the occurrence of such Termination Event and (b) with  
respect to any other Termination Event, all Transactions.                       

"Affiliate" means, subject to the Schedule, in relation to any person, any      
entity controlled, directly or indirectly, by the person, any entity that       
controls, directly or indirectly, the person or any entity directly or          
indirectly under common control with the person. For this purpose, "control" of 
any entity or person means ownership of a majority of the voting power of the   
entity or person.                                                               

"Applicable Rate" means:--                                                      

(a) in respect of obligations payable or deliverable (or which would have been  
but for Section 2(a)(iii)) by a Defaulting Party, the Default Rate;             

(b) in respect of an obligation to pay an amount under Section 6(e) of either   
party from and after the date (determined in accordance with Section 6(d)(ii))  
on which that amount is payable, the Default Rate;                              

(c) in respect of all other obligations payable or deliverable (or which would  
have been but for Section 2(a)(iii)) by a Non-defaulting Party, the Non-default 
Rate; and                                                                       

(d) in all other cases, the Termination Rate.                                   

"Burdened Party" has the meaning specified in Section 5(b).                     

"Change in Tax Law" means the enactment, promulgation, execution or ratification
of, or any change in or amendment to, any law (or in the application or official
interpretation of any law) that occurs on or after the date on which the        
relevant Transaction is entered into.                                           

"consent" includes a consent, approval, action, authorisation, exemption,       
notice, filing, registration or exchange control consent.                       

"Credit Event Upon Merger" has the meaning specified in Section 5(b).           

"Credit Support Document" means any agreement or instrument that is specified as
such in this Agreement.                                                         

"Credit Support Provider" has the meaning specified in the Schedule.            

"Default Rate" means a rate per annum equal to the cost (without proof or       
evidence of any actual cost) to the relevant payee (as certified by it) if it   
were to fund or of funding the relevant amount plus 1% per annum.               

"Defaulting Party" has the meaning specified in Section 6(a).                   

"Early Termination Date" means the date determined in accordance with Section   
6(a) or 6(b)(iv).                                                               

"Event of Default" has the meaning specified in Section 5(a) and, if applicable,
in the Schedule.                                                                

"Illegality" has the meaning specified in Section 5(b).                         

"Indemnifiable Tax" means any Tax other than a Tax that would not be imposed in 
respect of a payment under this Agreement but for a present or former connection
between the jurisdiction of the government or taxation authority imposing such  
Tax and the recipient of such payment or a person related to such recipient     
(including, without limitation, a connection arising from such recipient or     
related person being or having been a citizen or resident of such jurisdiction, 
or being or having been organised, present or engaged in a trade or business in 
such jurisdiction, or having or having had a permanent establishment or fixed   
place of business in such jurisdiction, but excluding a connection arising      
solely from such recipient or related person having executed, delivered,        
performed its obligations or received a payment under, or enforced, this        
Agreement or a Credit Support Document).                                        

"law" includes any treaty, law, rule or regulation (as modified, in the ease of 
tax matters, by the practice of any relevant governmental revenue authority) and
"lawful" and "unlawful" will be construed accordingly.                          

"Local Business Day" means, subject to the Schedule, a day on which commercial  
banks are open for business (including dealings in foreign exchange and foreign 
currency deposits) (a) in relation to any obligation under Section 2(a)(i), in  
the place(s) specified in the relevant Confirmation or, if not so specified, as 
otherwise agreed by the parties in writing or determined pursuant to provisions 
contained, or incorporated by reference, in this Agreement, (b) in relation to  
any other payment, in the place where the relevant account is located and, if   
different, in the principal financial centre, if any, of the currency of such   
payment, (c) in relation to any notice or other communication, including notice 
contemplated under Section 5(a)(i), in the city specified in the address for    
notice provided by the recipient and, in the case of a notice contemplated by   
Section 2(b), in the place where the relevant new account is to be located and  
(d) in relation to Section 5(a)(v)(2), in the relevant locations for performance
with respect to such Specified Transaction.                                     

"Loss" means, with respect to this Agreement or one or more Terminated          
Transactions, as the case may be, and a party, the Termination Currency         
Equivalent of an amount that party reasonably determines in good faith to be its
total losses and costs (or gain, in which case expressed as a negative number)  
in connection with this Agreement or that Terminated Transaction or group of    
Terminated Transactions, as the case may be, including any loss of bargain, cost
of funding or, at the election of such party but without duplication, loss or   
cost incurred as a result of its terminating, liquidating, obtaining or         
reestablishing any hedge or related trading position (or any gain resulting from
any of them). Loss includes losses and costs (or gains) in respect of any       
payment or delivery required to have been made (assuming satisfaction of each   
applicable condition precedent) on or before the relevant Early Termination Date
and not made, except so as to avoid duplication, if Section 6(e)(i)(l) or (3) or
6(e)(ii)(2)(A) applies. Loss does not include a party's legal fees and          
out-of-pocket expenses referred to under Section 11. A party will determine its 
Loss as of the relevant Early Termination Date, or, if that is not reasonably   
practicable, as of the earliest date thereafter as is reasonably practicable. A 
party may (but need not) determine its Loss by reference to quotations of       
relevant rates or prices from one or more leading dealers in the relevant       
markets.                                                                        

"Market Quotation" means, with respect to one or more Terminated Transactions   
and a party making the determination, an amount determined on the basis of      
quotations from Reference Market-makers. Each quotation will be for an amount,  
if any, that would be paid to such party (expressed as a negative number) or by 
such party (expressed as a positive number) in consideration of an agreement    
between such party (taking into account any existing Credit Support Document    
with a respect to the obligations of such party) and the quoting Reference      
Market-maker to enter into a transaction (the "Replacement Transaction") that   
would have the effect of preserving for such party the economic equivalent of   
any payment or delivery (whether the underlying obligation was absolute or      
contingent and assuming the satisfaction of each applicable condition precedent)
by the parties under Section 2(a)(i) in respect of such Terminated Transaction  
or group of Terminated Transactions that would, but for the occurrence of the   
relevant Early Termination Date, have been required after that date. For this   
purpose, Unpaid Amounts in respect of the Terminated Transaction or group of    
Terminated Transactions are to be excluded but, without limitation, any payment 
or delivery that would, but for the relevant Early Termination Date, have been  
required (assuming satisfaction of each applicable condition precedent) after   
that Early Termination Date is to be included. The Replacement Transaction would
be subject to such determination as such party and the Reference Market-maker   
may, in good faith, agree. The party making the determination (or its agent)    
will request each Reference Market-maker to provide its quotation to the extent 
reasonably practicable as of the same day and time (without regard to different 
time zones) on or as soon as reasonably practicable after the relevant Early    
Termination Date. The day and time as of which those quotations are to be       
obtained will be selected in good faith by the party obliged to make a          
determination under Section 6(e), and, if each party is so obliged, after       
consultation with the other. If more than three quotations are provided, the    
Market Quotation will be the arithmetic mean of the quotations, without regard  
to the quotations having the highest and lowest values. If exactly three such   
quotations are provided, the Market Quotation will be the quotation remaining   
after disregarding the highest and lowest quotations. For this purpose, if more 
than one quotation has the same highest value or lowest value, then one of such 
quotations shall be disregarded. If fewer than three quotations are provided, it
will be deemed that the Market Quotation in respect of such Terminated          
Transaction or group of Terminated Transactions cannot be determined.           

"Non-default Rate" means a rate per annum equal to the cost (without proof or   
evidence of any actual cost) to the Non-defaulting Party (as certified by it) if
it were to fund the relevant amount.                                            

"Non-defaulting Party" has the meaning specified in Section 6(a).               

"Office" means a branch or office of a party, which may be such party's head or 
home office.                                                                    

"Potential Event of Default" means any event which, with the giving of notice or
the lapse of time or both, would constitute an Event of Default.                

"Reference Market-makers" means four leading dealers in the relevant market     
selected by the party determining a Market Quotation in good faith (a) from     
among dealers of the highest credit standing which satisfy all the criteria that
such party applies generally at the time in deciding whether to offer or to make
an extension of credit and (b) to the extent practicable, from among such       
dealers having an office in the same city.                                      

"Relevant Jurisdiction" means, with respect to a party, the jurisdictions (a) in
which the party is incorporated, organised, managed and controlled or considered
to have its seat, (b) where an Office through which the party is acting for     
purposes of this Agreement is located, (c) in which the party executes this     
Agreement and (d) its relation to any payment, from or through which such       
payment is made.                                                                

"Scheduled Payment Date" means a date on which a payment or delivery is to be   
made under Section 2(a)(i) with respect to a Transaction.                       

"Set-off" means set-off, offset, combination of accounts, right of retention or 
withholding or similar right or requirement to which the payer of an amount     
under Section 6 is entitled or subject (whether arising under this Agreement,   
another contract, applicable law or otherwise) that is exercised by, or imposed 
on, such payer.                                                                 

"Settlement Amount" means, with respect to a party and any Early Termination    
Date, the sum of: --                                                            

(a)   the Termination Currency Equivalent of the Market Quotations (whether     
positive or negative) for each Terminated Transaction or group of Terminated    
Transactions for which a Market Quotation is determined; and                    

(b)   such party's Loss (whether positive or negative and without reference to  
any Unpaid Amounts) for each Terminated Transaction or group of Terminated      
Transactions for which a Market Quotation cannot be determined or would not (in 
the reasonable belief of the party making the determination) produce a          
commercially reasonable result.                                                 

"Specified Entity" has the meanings specified in the Schedule.                  

"Specified Indebtedness" means, subject to the Schedule, any obligation (whether
present or future, contingent or otherwise, as principal or surety or otherwise)
in respect of borrowed money.                                                   

"Specified Transaction" means, subject to the Schedule, (a) any transaction     
(including an agreement with respect thereto) now existing or hereafter entered 
into between one party to this Agreement (or any Credit Support Provider of such
party or any applicable Specified Entity of such party) and the other party to  
this Agreement (or any Credit Support Provider of such other party or any       
applicable Specified Entity of such other party) which is a rate swap           
transaction, basis swap, forward rate transaction, commodity swap, commodity    
option, equity or equity index swap, equity or equity index option, bond option,
interest rate option, foreign exchange transaction, cap transaction, floor      
transaction, collar transaction, currency swap transaction, cross-currency rate 
swap transaction, currency option or any other similar transaction (including   
any option with respect to any of these transactions), (b) any combination of   
these transactions and (c) any other transaction identified as a Specified      
Transaction in this Agreement or the relevant confirmation.                     

"Stamp Tax" means any stamp, registration, documentation or similar tax.        

"Tax" means any present or future tax, levy, impost, duty, charge, assessment or
fee of any nature (including interest, penalties and additions thereto) that is 
imposed by any government or other taxing authority in respect of any payment   
under this Agreement other than a stamp, registration, documentation or similar 
tax.                                                                            

"Tax Event" has the meaning specified in Section 5(b).                          

"Tax Event Upon Merger" has the meaning specified in Section 5(b).              

"Terminated Transactions" means with respect to any Early Termination Date (a)  
if resulting from a Termination Event, all Affected Transactions and (b) if     
resulting from an Event of Default, all Transactions (in either ease) in effect 
immediately before the effectiveness of the notice designating that Early       
Termination Date (or, if "Automatic Early Termination" applies, immediately     
before that Early Termination Date).                                            

"Termination Currency" has the meaning specified in the Schedule.               

"Termination Currency Equivalent" means, in respect of any amount denominated in
the Termination Currency, such Termination Currency amount and, in respect of   
any amount denominated in a currency other than the Termination Currency (the   
"Other Currency"), the amount in the Termination Currency determined by the     
party making the relevant determination as being required to purchase such      
amount of such Other Currency as at the relevant Early Termination Date, or, if 
the relevant Market Quotation or Loss (as the case may be), is determined as of 
a later date, that later date, with the Termination Currency at the rate equal  
to the spot exchange rate of the foreign exchange agent (selected as provided   
below) for the purchase of such Other Currency with the Termination Currency at 
or about 11:00 a.m. (in the city in which such foreign exchange agent is        
located) on such date as would be customary for the determination of such a rate
for the purchase of such Other Currency for value on the relevant Early         
Termination Date or that later date. The foreign exchange agent will, if only   
one party is obliged to make a determination under Section 6(e), be selected in 
good faith by that party and otherwise will be agreed by the parties.           

"Termination Event" means an Illegality, a Tax Event or a Tax Event Upon Merger 
or, if specified to be applicable, a Credit Event Upon Merger or an Additional  
Termination Event.                                                              

"Termination Rate" means a rate per annum equal to the arithmetic mean of the   
cost (without proof or evidence of any actual cost) to each party (as certified 
by such party) if it were to fund or of funding such amounts.                   

"Unpaid Amounts" owing to any party means, with respect to an Early Termination 
Date, the aggregate of (a) in respect of all Terminated Transactions, the       
amounts that became payable (or that would have become payable but for Section  
2(a)(iii)) to such party under Section 2(a)(i) on or prior to such Early        
Termination Date and which remain unpaid as at such Early Termination Date and  
(b) in respect of each Terminated Transaction, for each obligation under Section
2(a)(i) which was (or would have been but for Section 2(a)(iii)) required to be 
settled by delivery to such party on or prior to such Early Termination Date and
which has not been so settled as at such Early Termination Date, an amount equal
to the fair market value of that which was (or would have been) required to be  
delivered as of the originally scheduled date for delivery, in each ease        
together with (to the extent permitted under applicable law) interest, in the   
currency of such amounts, from (and including) the date such amounts or         
obligations were or would have been required to have been paid or performed to  
(but excluding) such Early Termination Date, at the Applicable Rate. Such       
amounts of interest will be calculated on the basis of daily compounding and the
actual number of days elapsed. The fair market value of any obligation referred 
to in clause (b) above shall be reasonably determined by the party obliged to   
make the determination under Section 6(e) or, if each party is so obliged, it   
shall be the average of the Termination Currency Equivalents of the fair market 
values reasonably determined by both parties.                                   

IN WITNESS WHEREOF the parties have executed this document on the respective    
dates specified below with effect from the date specified on the first page of  
this document.                                                                  

MORGAN STANLEY CAPITAL SERVICES INC.      DEUTSCHE BANK NATIONAL TRUST COMPANY, 
                                   not individually, but solely as
                                          Trustee for Morgan Stanley ABS Capital
                                   I Inc. Trust 2006-NC1, Mortgage
                                     Pass-Through Certificates, Series
            2006-NC1

By: /s/Nina C. Simmons                    By: /s/Eiko Akiyama                   
 ----------------------------              ---------------------------------
Name: Nina C. Simmons                     Name: Eiko Akiyama            
Title: Authorized Signatory               Title: Associate              
Date: January 27, 2006                    Date: January 27, 2006        

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                                                                  EXECUTION COPY

SCHEDULE
TO THE
MASTER AGREEMENT
dated as of January 27, 2006
 between

MORGAN STANLEY CAPITAL SERVICES INC.
a Delaware corporation
 ("Party A")

 and

DEUTSCHE BANK NATIONAL TRUST COMPANY
 a national banking association, not individually,
but solely as Trustee for Morgan Stanley ABS Capital I Inc. Trust 2006-NC1
(the "Trust"),
Mortgage Pass-Through Certificates, Series 2006-NC1   
 ("Party B")

Part 1.     Termination Provisions.                                             

     (a)   "Specified Entity" means in relation to Party A for the
purpose of:                                 

Section 5(a)(v), None Specified             
Section 5(a)(vi), None Specified            
Section 5(a)(vii), None Specified           
Section 5(b)(iv), None Specified            

and in relation to Party B for the purpose of:          

Section 5(a)(v), None Specified             
Section 5(a)(vi), None Specified            
Section 5(a)(vii), None Specified           
Section 5(b)(iv), None Specified            

           (b)   "Specified Transaction" is not applicable to Party A or Party
                  B for any purpose, and, accordingly, Section 5(a)(v) shall not
apply to Party A or Party B.                

           (c)   "Cross Default" provisions of Section 5(a)(vi) will not apply
to Party A and will not apply to Party B.   

            (d)   "Credit Event Upon Merger" provisions of Section 5(b)(iv) will
       not apply to Party A and will not apply to Party B.

          (e)   The "Automatic Early Termination" provisions of Section 6(a)
            will not apply to Party A and will not apply to Party B.

           (f)   Payments on Early Termination. "Market Quotation" and "Second
              Method" will apply for the purpose of Section 6(e) of this
Agreement.                                  

 (g)   "Termination Currency" means United States Dollars.

    (h)   Additional Termination Event will apply. The following
               Additional Termination Events will apply, in each case with
         respect to Party B as the sole Affected Party (unless
otherwise provided below):                  

                (i)   Upon any amendment, supplement, modification or waiver
                      of any provision of the PSA (as defined below) without
                    the consent of Party A that materially and adversely
           affects the rights or interests of Party A.

                  (ii)  Party A fails to comply with the Rating Agency Downgrade
                   provisions as set forth in Part 5(h) below. For all
                     purposes of this Agreement, Party A shall be the sole
                  Affected Party with respect to the occurrence of a
                  Termination Event described in this Part 1(h)(ii).

           (iii) The Servicer exercises its option to purchase the
                   Mortgage Loans pursuant to Section 9.01 of the PSA.

                 (iv)  Upon the irrevocable direction to dissolve or otherwise
                     terminate the Trust following which all assets of the
                 Trust will be liquidated and the proceeds of such
                  liquidation distributed to the Certificateholders.

    (i)   "Breach of Agreement" provision of Section 5(a)(ii) will not apply
to Party A or Party B.                                  

   (j)   "Credit Support Default" provisions of Section 5(a)(iii) will not
apply to Party B.                                       

      (k)   "Misrepresentation" provisions of Section 5(a)(iv) will not apply to
Party A or Party B.                                     

  (l)   The "Merger Without Assumption" provisions of Section 5(a)(viii)
will not apply to Party B.                              

 (m)   Failure to Pay or Deliver. Section 5(a)(i) is hereby amended by
            deleting the word "third" in the third line thereof and replacing it
with the word "second".                                 

      (n)   Bankruptcy. Section 5(a)(vii) shall apply to Party A and to Party B;
        provided, however, with respect to Party B, Section 5(a)(vii)(2)
shall not apply.                                        

Part 2.     Tax Representations.                                                

            (a)   Party A and Party B Payer Tax Representations. For the purpose
          of Section 3(e), each of Party A and Party B makes the
following representation:                   

                It is not required by any applicable law, as modified by the
               practice of any relevant governmental revenue authority, of
                  any Relevant Jurisdiction to make any deduction or withholding
             for or on account of any Tax from any payment (other than
                interest under Section 2(e), 6(d)(ii) or 6(e)) to be made by
              it to the other party under this Agreement. In making this
          representation, it may rely on (i) the accuracy of any
              representation made by the other party pursuant to Section
             3(f); (ii) the satisfaction of the agreement of the other
           party contained in Section 4(a)(i) or 4(a)(iii) and the
              accuracy and effectiveness of any document provided by the
             other party pursuant to Section 4(a)(i) or 4(a)(iii); and
              (iii) the satisfaction of the agreement of the other party
              contained in Section 4(d), provided that it shall not be a
             breach of this representation where reliance is placed on
              clause (ii) and the other party does not deliver a form or
          document under Section 4(a)(iii) by reason of material
  prejudice to its legal or commercial position.

(b)   Party A and Party B Payee Tax Representations.    

            (i)   For the purpose of Section 3(f), Party A makes the
following representation:       

                        (1) It is a U.S. corporation organized under the laws of
the State of Delaware.          

            (ii)  For the purpose of Section 3(f), Party B makes the
following representations:      

                     Party B is the Trust for which Deutsche Bank National
                      Trust Company as trustee is signing. The Trust is duly
                     formed under the laws of the State of New York and is
               not a foreign corporation for United States tax
purposes.                       

Part 3.     Agreement to Deliver Documents.                                     

For the purpose of Sections 4(a)(i) and (ii), each party agrees to deliver the  
following documents, as applicable:                                             

       (a)   Tax forms, documents or certificates to be delivered are:

Party                                                                         
required to                                                                     
deliver                                                                       
document     Form/Document/Certificate       Date by which to be delivered    
-----------   -------------------------      ---------------------------------- 
Party B       Any document required or       Promptly after the earlier of      
           reasonably requested to        (i) reasonable demand by Party A
          allow Party A to make          or (ii) learning that such form
   payments under this            or document is required.
Agreement without any                               
deduction or withholding                            
for or on the account of                            
any Tax or with such                                
deduction or withholding at                         
a reduced rate.                                     

(b)     Other documents to be delivered are:-                       

  Party                                                           Covered by
required                                                            Section   
to  deliver                                    Date by which          3(d)    
  document    Form/Document/Certificate       to be delivered     Representation
------------  -------------------------      ------------------   --------------
Party A       Either (1) a signature         The earlier of the         Yes     
and           booklet containing             fifth Business Day                 
Party B       secretary's certificate and    after the Trade                    
resolutions ("authorizing      Date of the first    
resolutions") authorizing      Transaction or upon  
the party to enter into        execution of this    
derivatives transactions of    Agreement and as     
the type contemplated by       deemed necessary     
the parties or (2) a           for any further      
secretary's certificate,       documentation.       
authorizing resolutions and                         
incumbency certificate, in                          
either case, for such party                         
and any Credit Support                              
Provider of such party                              
reasonably satisfactory in                          
form and substance to the                           
other party.                                        

Party B       An executed copy of the        Upon execution of          Yes     
Pooling and Servicing          this Agreement.      
Agreement ("PSA"), dated as                         
of January 1, 2006, among                           
Morgan Stanley ABS Capital                          
I Inc., HomEq Servicing                             
Corporation, JPMorgan Chase                         
Bank, National Association,                         
Deutsche Bank National                              
Trust Company and NC                                
Capital Corporation.                                

Party A       A duly executed copy of the    As soon as                 No      
and           Credit Support Document        practicable after                  
Party B       specified in Part 4 of this    the execution of                   
Schedule.                      this Agreement.      

Party A       An opinion of counsel          As soon as                 No      
and Party B   reasonably satisfactory in     practicable after                  
form and substance to the      the execution of     
other party.                   this Agreement.      

Party B       Taxpayer Identification        Upon execution of          Yes     
Number of Party B as           this Agreement       
required by Part I of                               
United States Internal                              
Revenue Service Form W-9                            

Part 4.     Miscellaneous                                                       

       (a)   Addresses for Notices. For the purpose of Section 12(a):-

            (i)   Address for notices or communications to Party A:-

    MORGAN STANLEY CAPITAL SERVICES INC.
Transaction Management Group    
1585 Broadway                   
New York, New York 10036-8293   
Attention:  CHIEF LEGAL OFFICER 
  Fax No:           001 212 507 4622

           (ii)  Address for notices or communications to Party B:

    DEUTSCHE BANK NATIONAL TRUST COMPANY
1761 East St. Andrew Place      
 Santa Ana, California  92705-4934
         Attention:  Trust Administration - MS06C1
Facsimile No.:    714 247 6329  
Telephone No.:    714 247 6000  

           (b)   Notices. Section 12(a) is amended by adding in the third line
                  thereof after the phrase "messaging system" and before the ")"
             the words, "; provided, however, any such notice or other
                 communication may be given by facsimile transmission if telex
            is unavailable, no telex number is supplied to the party
           providing notice, or if answer back confirmation is not
       received from the party to whom the telex is sent."

(c)   Process Agent. For the purpose of Section 13(c):  

Party A does not appoint a Process Agent.   

Party B does not appoint a Process Agent.   

        (d)   Offices. The provisions of Section 10(a) will not apply to
Party A and to Party B.                     

  (e)   Multibranch Party. For the purpose of Section 10(c):

Party A is not a Multibranch Party.         

Party B is not a Multibranch Party.         

(f)   "Calculation Agent" means Party A.                

            (g)   "Credit Support Document" means any Confirmation and any other
             document any of which by its terms secures, guarantees or
                otherwise supports either or both parties' obligations under
                  this Agreement, including, but not limited to, the ISDA Credit
                  Support Annex attached hereto as Exhibit A and dated as of the
            date hereof (the provisions of which are incorporated by
          reference herein) and the guarantee of Morgan Stanley.

          (h)   Credit Support Provider means in relation to Party A: Morgan
Stanley, a Delaware corporation.            

              Credit Support Provider means in relation to Party B: None

      (i)   Governing Law; Jurisdiction. This Agreement, each Credit
                  Support Document and each Confirmation will be governed by and
                  construed in accordance with the laws of the State of New York
              without regard to conflict of law provisions thereof other
             than New York General Obligations Law Sections 5-1401 and
                 5-1402. Section 13(b) is amended by: (1) deleting "non-" from
             the second line of clause (i); and (2) deleting the final
paragraph.                                  

            (j)   Waiver of Jury Trial. Each party waives, to the fullest extent
                 permitted by applicable law, any right it may have to a trial
          by jury in respect of any Proceedings relating to this
Agreement or any Credit Support Document.   

            (k)   Netting of Payments. Clause (ii) of Section 2(c) will apply to
                  any amounts payable with respect to Transactions from the date
of this Agreement.                          

          (l)   "Affiliate". Party A and Party B shall be deemed not to have
                any Affiliates for purposes of this Agreement, including for
                  purposes of Section 6(b)(ii). For the avoidance of doubt, with
              respect to Party A, such definition shall be understood to
   exclude Morgan Stanley Derivative Products Inc.

        (m)   Additional Definitions. All capitalized terms used but not
               otherwise defined in this Agreement shall have the meanings
given thereto in the PSA.                   

Part 5.     Other Provisions                                                    

(a)   Representations.                                  

                (i)   The introductory clause of Section 3 of this Agreement
                     is hereby amended to read in its entirety as follows:

                "Each party represents to the other party (which
                     representations will be deemed to be repeated by each
                    party on each date on which a Transaction is entered
                       into and, in the case of the representations in Section
                3(f) and Section 3(g)(4), at all times until the
       termination of this Agreement) that:--"

                 (ii)  Section 3 of this Agreement is hereby amended by adding
                at the end thereof the following subsection (g):

   "(g)  Relationship Between Parties.

                     (1) Nonreliance. It is not relying on any
                          statement or representation of the other party
                              regarding a Transaction (whether written or oral),
                            other than the representations expressly made in
                            this Agreement or the Confirmation in respect of
that Transaction.   

             (2) Evaluation and Understanding.

                                      (i) Non-Reliance. In the case of Party
                           A, it is acting for its own account, and in the
                            case of Party B, it is acting as Trustee. It has
                            made its own independent decisions to enter into
                   that Transaction and as to whether that
                             Transaction is appropriate or proper for it based
                           upon its own judgment and upon advice from such
                         advisers as it has deemed necessary and, with
                             respect to Party B, as directed under the PSA. It
                           is not relying on any communication (written or
                            oral) of the other party as investment advice or
                  as a recommendation to enter into that
                             Transaction; it being understood that information
                     and explanations related to the terms and
                    conditions of a Transaction shall not be
                            considered investment advice or a recommendation
                            to enter into that Transaction. No communication
                           (written or oral) received from the other party
                              shall be deemed to be an assurance or guarantee as
                        to the expected results of that Transaction.

                                        (ii) Assessment and Understanding. It is
                  capable of assessing the merits of and
                       understanding (on its own behalf or through
                             independent professional advice), and understands
                           and accepts, the terms, conditions and risks of
                             that Transaction. It is also capable of assuming,
                       and assumes, the risks of that Transaction.

                                        (iii) Status of Parties. The other party
                             is not acting as a fiduciary for or an adviser to
              it in respect of that Transaction.

                             (3) Purpose. It is an "eligible swap participant"
                            as such term is defined in Section 35.1(b)(2) of
                            the regulations (17 C.F.R 35) promulgated under,
                             and an "eligible contract participant" as defined
                             in Section 1a(12) of, the Commodity Exchange Act,
                   as amended, and it is entering into the
                        Transaction for the purposes of managing its
                             borrowings or investments, hedging its underlying
                              assets or liabilities or in connection with a line
of business.        

                      (4) ERISA Representation. It is not (i) an
                        employee benefit plan (hereinafter an "ERISA
                              Plan"), as defined in Section 3(3) of the Employee
                              Retirement Income Security Act of 1974, as amended
                            ("ERISA"), subject to Title I of ERISA or a plan
                           subject to Section 4975 of the Internal Revenue
                             Code of 1986, as amended, or subject to any other
                              statute, regulation, procedure or restriction that
                            is materially similar to Section 406 of ERISA or
                         Section 4975 of the Code (together with ERISA
                              Plans, "Plans"), (ii) a person acting on behalf of
                              a Plan or (iii) a person any of the assets of whom
                        constitute assets of a Plan. It will provide
                             notice to the other party in the event that it is
                            aware that it is in breach of any aspect of this
                            representation or is aware that with the passing
                      of time, giving of notice or expiry of any
                       applicable grace period it will breach this
representation."    

(b)   Set off. Subject to Section 2(c), notwithstanding any other   
   provision of this Agreement or any other existing or future
          agreement, each party irrevocably waives any and all rights it may
      have to set off, net, recoup or otherwise withhold, suspend or
         condition payment or performance of any obligation between it and
           the other party hereunder against any obligation between it and the
          other party under any other agreements. The provisions for set off
    set forth in Section 6(e) of this Agreement shall not apply.

(c)   Export of Defaults. The occurrence or designation of an Early 
         Termination Date on account of an Event of Default or Termination
  Event with respect to a party hereto ("X") (where X is the
            Defaulting Party or sole Affected Party) shall constitute a material
   breach and event of default (howsoever described) under all
            transactions between X and the other party ("Y") or any Affiliate of
      Y (whether or not arising under this Agreement, whether or not
          matured, whether or not contingent and regardless of the currency,
            place of payment or booking office of the obligation) (together, the
           "Other Transactions"), whereupon Y or any Affiliate of Y shall have
          the right to terminate, liquidate and otherwise close out any such
          Other Transactions (and X shall be liable for any damages suffered
by Y and any Affiliate of Y as a result thereof).       

   (d)   Single Relationship. The parties and their Affiliates intend that
          all Transactions and all other obligations (whether or not arising
    under this Agreement, whether or not matured, whether or not
      contingent and regardless of the currency, place of payment or
        booking office of the obligation) shall be treated as mutual and
            part of a single, indivisible contractual and business relationship.

(e)   Confirmations. Party A will deliver to Party B a Confirmation 
relating to each Transaction.                           

  (f)   Form of Agreement. The parties hereby agree that the text of the
         body of this Agreement is intended to be the printed form of 1992
            ISDA Master Agreement (Multicurrency--Cross Border) as published and
           copyrighted by the International Swaps and Derivatives Association,
Inc.                                                    

     (g)   Transfer, Amendment and Assignment. No transfer, amendment, waiver,
            supplement, assignment or other modification of this Agreement shall
     be permitted by either party unless each of Standard & Poor's
      Ratings Service, a division of The McGraw Hill Companies, Inc.
            ("S&P"), Moody's Investors Service, Inc. ("Moody's") and Fitch, Inc.
           ("Fitch", and together with S&P and Moody's, the "Rating Agencies")
    has been provided notice of the same and confirms in writing
       (including by facsimile transmission) within five Business Days
       after such notice is given that it will not downgrade, qualify,
          withdraw or otherwise modify its then current rating of the Morgan
        Stanley ABS Capital I Inc. Trust 2006-NC1, Mortgage Pass-Through
Certificates, Series 2006-NC1.                          

  (h)   Rating Agency Downgrade. (i) In the event that any of the Rating
            Agencies downgrades Morgan Stanley or a replacement counterparty, or
 an entity that guarantees the obligations of Party A or a
      replacement counterparty, below the Required Swap Counterparty
           Rating (as defined below) or Moody's or Fitch withdraws its ratings
          of Morgan Stanley or a replacement counterparty, or an entity that
            guarantees the obligations of Party A or a replacement counterparty,
       then, within 30 days after such rating downgrade or withdrawal,
            Party A or such replacement counterparty, as the case may be, shall,
         subject to the Rating Agency Condition (as defined below), at its
          own expense, either (1) cause another entity to replace Party A as
       party to this Agreement that meets or exceeds the Required Swap
  Counterparty Rating on terms substantially similar to this
         Agreement, (2) obtain a guaranty of, or a contingent agreement of
          another person with the Required Swap Counterparty Rating to honor
         Party A's obligations under this Agreement, (3) collateralize its
       exposure to the Trust pursuant to the ISDA Credit Support Annex
        attached hereto as Exhibit A, subject to the satisfaction of the
          Rating Agency Condition or (4) take other steps, if any, to enable
           the Trust to satisfy the Rating Agency Condition; provided that for
        purposes of this Part 5(h), Party A shall be responsible for (A)
            posting collateral in accordance with such ISDA Credit Support Annex
         at its own cost and (B) any cost incurred by it in complying with
its obligations.                                        

    "Required Swap Counterparty Rating" means, with respect to a
   counterparty or entity guaranteeing the obligations of such
            counterparty, (x) either (i) if such counterparty or entity has only
         a long-term rating by Moody's, a long-term senior, unsecured debt
        obligation rating, credit rating or other similar rating (as the
         case may be, the "Long-Term Rating") of at least "Aa3" by Moody's
        and if rated "Aa3" by Moody's is not on negative credit watch by
      Moody's or (ii) if such counterparty or entity has a Long-Term
           Rating and a short-term rating by Moody's, a Long-Term Rating of at
         least "A1" by Moody's and a short-term rating of "P-1" by Moody's
         and, in each case, such rating is not on negative credit watch by
        Moody's, (y) (i) a short-term rating of at least "A-1" by S&P or
      (ii) if such counterparty or entity does not have a short-term
         rating by S&P, a Long-Term Rating of at least "A+" by S&P and (z)
       (i) short-term rating of at least "F1" by Fitch or (ii) if such
            counterparty or entity does not have a short-term rating by Fitch, a
Long-Term Rating of at least "A+" by Fitch.             

       "Rating Agency Condition" means, with respect to any particular
          proposed act or omission to act hereunder that the party acting or
         failing to act must consult with each of the Rating Agencies then
           providing a rating of the Certificates and receive from each Rating
       Agency a prior written confirmation that the proposed action or
      inaction would not cause a downgrade or withdrawal of the then
current rating of the Certificates.                     

            (ii) In the event that Morgan Stanley or a replacement counterparty,
    or an entity that guarantees the obligations of Party A or a
        replacement counterparty, has its rating by S&P withdrawn, has a
            rating of less than "BBB-" or "A-3", if applicable, by S&P, a rating
        of less than "BBB-" or "F3", if applicable, by Fitch or a rating
       less than or equal to "A3" or "P-2," if applicable, by Moody's,
            Party A or such replacement counterparty, as the case may be, shall,
            within 10 days thereafter, while collateralizing its exposure to the
          Trust pursuant to the ISDA Credit Support Annex attached hereto as
            Exhibit A, (1) transfer this Agreement at its sole cost and expense,
       in whole, but not in part, to a counterparty that satisfies the
         Required Swap Counterparty Rating, subject to satisfaction of the
            Rating Agency Condition or (2) obtain a guaranty of, or a contingent
        agreement of, another person with the Required Swap Counterparty
           Rating to honor Party A's obligations under this Agreement, subject
to satisfaction of the Rating Agency Condition.         

    (iii) Failure to act in accordance with this Part 5(h) shall
           constitute an Additional Termination Event but shall not constitute
      an Event of Default under Part 5(a)(ii) (Breach of Agreement).

      (i)   Severability. If any term, provision, covenant, or condition of this
           Agreement, or the application thereof to any party or circumstance,
          shall be held to be invalid or unenforceable (in whole or in part)
       for any reason, the remaining terms, provisions, covenants, and
            conditions hereof shall continue in full force and effect as if this
     Agreement had been executed with the invalid or unenforceable
    portion eliminated, so long as this Agreement as so modified
   continues to express, without material change, the original
            intentions of the parties as to the subject matter of this Agreement
   and the deletion of such portion of this Agreement will not
           substantially impair the respective benefits or expectations of the
        parties; provided, however, that nothing in this provision shall
           adversely affect the rights of each party under this Agreement; and
      provided further that this severability provision shall not be
        applicable if any provision of Section 1, 2, 5, 6, or 13 (or any
          definition or provision in Section 14 to the extent it relates to,
           or is used in or connection with any such Section) shall be so held
            to be invalid or unenforceable. The parties shall endeavor to engage
          in good faith negotiations to replace any invalid or unenforceable
          term, provision, covenant or condition with a valid or enforceable
            term, provision, covenant or condition, the economic effect of which
          comes as close as possible to that of the invalid or unenforceable
term, provision, covenant or condition.                 

    (j)   Consent to Recording. Each party hereto consents to the monitoring
           or recording, at any time and from time to time, by the other party
   of any and all communications between trading and marketing
   personnel of the parties, waives any further notice of such
      monitoring or recording, and agrees to notify its officers and
employees of such monitoring or recording.              

     (k)   Proceedings. Party A shall not institute against or cause any other
            person to institute against, or join any other person in instituting
       against, the Trust or Deutsche Bank National Trust Company, not
            individually, but solely as Trustee, any bankruptcy, reorganization,
    arrangement, insolvency or liquidation proceedings, or other
            proceedings under any federal or state bankruptcy or similar law for
       a period of one year and one day (or, if longer, the applicable
         preference period) following payment in full of the Certificates;
           provided, however, that this shall not restrict or prohibit Party A
    from joining in any bankruptcy, reorganization, arrangement,
            insolvency, moratorium or liquidation proceedings or other analogous
proceedings under applicable laws.                      

(l)   Trustee Capacity. It is expressly understood and agreed by the
    parties hereto that insofar as this Agreement is executed by
           Deutsche Bank National Trust Company (i) this Agreement is executed
        and delivered by Deutsche Bank National Trust Company not in its
      individual capacity but solely as Trustee under the PSA in the
            exercise of the powers and authority conferred and invested in it as
          trustee thereunder, (ii) each of the representations, undertakings
     and agreements herein made on behalf of the Trust is made and
           intended not as personal representations of the Trustee but is made
         and intended for the purpose of binding only the Trust, and (iii)
            under no circumstances shall Deutsche Bank National Trust Company in
           its individual capacity be personally liable for the payment of any
          indebtedness or expenses or be personally liable for the breach or
            failure of any obligation, representation, warranty or covenant made
or undertaken under this Agreement.                     

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            IN WITNESS WHEREOF, the parties have executed this Schedule by their
duly authorized officers as of the date hereof:                                 

MORGAN STANLEY CAPITAL SERVICES INC.      DEUTSCHE BANK NATIONAL TRUST COMPANY, 
                                   not individually, but solely as
                                          Trustee for Morgan Stanley ABS Capital
                                   I Inc. Trust 2006-NC1, Mortgage
                                     Pass-Through Certificates, Series
            2006-NC1

By: /s/Nina C. Simmons                    By: /s/Eiko Akiyama                   
 ----------------------------              ---------------------------------
Name: Nina C. Simmons                     Name: Eiko Akiyama            
Title: Authorized Signatory               Title: Associate              
Date: January 27, 2006                    Date: January 27, 2006        

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 EXHIBIT A

Credit Support Annex

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                                                                  EXECUTION COPY

Paragraph 13.     Elections and Variables                                       

(a)   Security Interest for "Obligations". The term "Obligations" as used in    
    this Annex includes the following additional obligations with respect to
Party A and Party B: None.                                          

(b)   Credit Support Obligations.                                               

      (i)   "Delivery Amount" and "Return Amount" each has the meaning specified
            in Paragraph 3. "Credit Support Amount" has the meaning specified in
           Paragraph 3; provided, however, that in the event Party A elects or
            is required to post collateral pursuant to Part 5(h) of the Schedule
        due to a ratings downgrade or withdrawal by S&P, "Credit Support
           Amount" means, with respect to a Valuation Date, an amount equal to
        the greater of (1) the sum of (a) the MTM and (b) the Volatility
          Buffer multiplied by the Notional Amount and (2) zero. "MTM" means
         the Secured Party's Exposure for that Valuation Date. "Volatility
         Buffer" means (a) if, on the date of determination, Party A has a
            short-term credit rating of "A-2" by S&P and the Termination Date of
          the Transaction will occur in less than 5 years, 3.25%, (b) if, on
            the date of determination, Party A has a short-term credit rating of
           "A-2" by S&P and the Termination Date of the Transaction will occur
          in less than 10 years but more than 5 years, 4.00%, (c) if, on the
        date of determination, Party A has a short-term credit rating of
           "A-3" by S&P and the Termination Date of the Transaction will occur
          in less than 5 years, 4.00%, (d) if, on the date of determination,
      Party A has a short-term credit rating of "A-3" by S&P and the
            Termination Date of the Transaction will occur in less than 10 years
           but more than 5 years, 5.00%, (e) if, on the date of determination,
          Party A has a long-term credit rating of "BB+" or lower by S&P and
         the Termination Date of the Transaction will occur in less than 5
            years, 4.50%, or (f) if, on the date of determination, Party A has a
            long-term credit rating of "BB+" or lower by S&P and the Termination
         Date of the Transaction will occur in less than 10 years but more
than 5 years, 5.75%..                                   

     In the event Party A elects or is required to post collateral
           pursuant to Part 5(h) of the Schedule due to a ratings downgrade or
           withdrawal by S&P, the Valuation Agent shall verify its calculation
           of the Secured Party's Exposure on a quarterly basis by seeking two
 quotations from Reference Market-makers. If two Reference
          Market-makers are not available to provide a quotation, then fewer
            than two Reference Market-makers may be used for such purpose. If no
         Reference Market-makers are available, then the Valuation Agent's
         estimates at mid-market will be used. The Valuation Agent may not
       obtain the quotations referred to above from the same person in
            excess of four times during any 12 month period. Where more than one
      quotation is obtained, the quotation representing the greatest
       amount of Exposure shall be used by the Valuation Agent. In the
       event the verification procedures set forth above indicate that
           there is a deficiency in the amount of Eligible Collateral that has
         been Transferred to the Secured Party, the Pledgor shall Transfer
           the amount of Eligible Collateral necessary to cure such deficiency
to the Secured Party within three Local Business Days.  

(ii)        Eligible Collateral. The following items will qualify as "Eligible  
Collateral" for Party A:                                

                                                         Valuation
                    Eligible Collateral         Party A Percentage
                    -------------------         ------- ----------
   (A)    Cash                                  X       100.0%
   (B)    Treasury Securities with a            X        98.5%
remaining maturity of 52 weeks or         
less                                      
   (C)    Treasury Securities with a            X        93.6%
remaining maturity of more than 52        
weeks but no more than 5 years            
   (D)    Treasury Securities with a            X        89.9%
remaining maturity of more than 5         
years but no more than 10 years           
   (E)    Treasury Securities with a            X        83.9%
remaining maturity of more than 10        
years but no more than 30 years           
   (F)    Agency Notes with a remaining         X        81.3%
maturity of no more than 15 years         
   (G)    Agency Notes with a maturity of no    X        74.8%
more than 15 years but no more than       
30 years                                  
   (H)    Commercial Paper rated "A-1+" by      X        98.0%
S&P and "P-1" by Moody's                  
   (I)    Commercial Paper rated "A-1"          X        97.0%
by S&P and P-1 by Moody's, with a         
remaining maturity of 180 days or         
less                                      
   (J)    Commercial Paper rated "A-1" by       X        94.0%
S&P and "P-1" by Moody's, with a          
remaining maturity of more than           
180 days or but no more than 360          
days                                      

            Notwithstanding the above, Commercial Paper will qualify as Eligible
         Collateral for Party A only if the aggregate amount of Commercial
 Paper Transferred as Eligible Collateral under this Annex
constitutes the obligations of 10 or more issuers.      

(iii) Other Eligible Support: Not applicable.                       

(iv)  Thresholds.                                                   

        (A)   "Independent Amount" means, with respect to Party A, zero;
               provided, however, if Party A elects or is required to post
             collateral pursuant to Part 5(h) of the Schedule due to a
                 ratings downgrade or withdrawal by Moody's or Fitch, then the
             "Independent Amount" with respect to Party A shall be the
                  aggregate of any Transaction Independent Amounts in respect of
           all Transactions outstanding at that time. "Transaction
              Independent Amount" shall mean (unless otherwise agreed by
        Moody's and Fitch) 1% of the Notional Amount of each
Transaction.                                

              "Independent Amount" means, with respect to Party B, zero.

   (B)   "Threshold" means with, respect to Party A: Infinite;
               provided, however, if Party A elects or is required to post
             collateral pursuant to Part 5(h) of the Schedule due to a
                 ratings downgrade or withdrawal by Moody's or Fitch, then the
             "Threshold" with respect to Party A shall be zero (unless
otherwise agreed by Moody's and Fitch);     

         "Threshold" means with respect to Party B:  Infinite.

          (C)   "Minimum Transfer Amount" means with respect to Party A: USD
                100,000; and with respect to Party B: USD 100,000; provided,
                  however, that if such party is a Defaulting Party at the time,
                  "Minimum Transfer Amount" shall mean zero with respect to such
party.                                      

     (D)   Rounding. The Delivery Amount will be rounded up to the
           nearest multiple of $1000 and the Return Amount will be
  rounded down to the nearest multiple of $1000.

(c)   Valuation and Timing.                                                     

 (i)   "Valuation Agent" means for purposes of Paragraphs 3 and 5, the
       party making the demand under Paragraph 3, and, for purposes of
            Paragraph 6(d), the Secured Party receiving or deemed to receive the
Distributions or the Interest Amount, as applicable.    

   (ii)  "Valuation Date" means (A) each and every Wednesday commencing on
            the first such date following the date hereof or if any Wednesday is
            not a Local Business Day, the next succeeding Local Business Day and
       (B) any other Local Business Day on which notice is made before
    12:00 noon, New York time on the immediately preceding Local
Business Day.                                           

     (iii) "Valuation Time" means the close of business in New York on the New
          York Banking Day before the Valuation Date or date of calculation,
   as applicable, or any time on the Valuation Date or date of
           calculation, as applicable; provided that the calculations of Value
          and Exposure will be made as of approximately the same time on the
same date.                                              

(iv)  "Notification Time" means 1:00 p.m., New York time, on a Local
            Business Day. (v) The Valuation Agent's calculations pursuant to the
     terms hereof shall be made in accordance with standard market
         practice, using commonly accepted third party sources that comply
         with S&P's criteria (e.g. Bloomberg, Bridge Information Services,
Reuters and Telerate).                                  

(d)   Conditions Precedent and Secured Party's Rights and Remedies. The         
      following Termination Events will be a "Specified Condition" for the party
   specified (that party being the Affected Party of the Termination Event
occurs with respect to that party): Not Applicable.                 

(e)   Substitution.                                                             

      (i)   "Substitution Date" has the meaning specified in Paragraph 4(d)(ii).

      (ii)  Consent. The Pledgor need not obtain the Secured Party's consent for
any substitution pursuant to Paragraph 4(d).            

(f)   Dispute Resolution.                                                       

(i)   "Resolution Time" means 1:00 p.m., New York time, on the Local
          Business Day following the date on which the notice of the dispute
is given under Paragraph 5.                             

      (ii)  Value. For the purpose of Paragraphs 5(i)(C) and 5(ii), the Value of
           Posted Credit Support or of any Transfer of Eligible Credit Support
           or Posted Credit Support, as the case may be, will be calculated by
       the Valuation Agent in accordance with standard market practice
   using third party sources (such as, by way of example only,
Bloomberg or Reuters) where available.                  

(iii) Alternative. The provisions of Paragraph 5 will apply.        

(g)   Holding and Using Posted Collateral.                                      

(i)   Eligibility to Hold Posted Collateral; Custodian.             

Party B and its Custodian will be entitled to hold Posted Collateral
pursuant to Paragraph 6(b); provided that the following conditions  
applicable to it are satisfied:                                     

(A)   Party B is not a Defaulting Party.                

 (B)   Posted Collateral may be held only in the following
jurisdictions: the United States of America.

   Initially, the Custodian for Party B is Party B

 (ii)  Use of Posted Collateral. The provisions of Paragraph 6(c) will
apply.                                                  

(h)   Distributions and Interest Amount.                                        

 (i)   "Interest Rate". The "Interest Rate" shall be the rate actually
         earned by the Custodian on Posted Collateral in the form of Cash.

  (ii)  Transfer of Interest Amount. The Transfer of the Interest Amount
          will be made on the last Local Business Day of each calendar month
           and on any Local Business Day that Posted Collateral in the form of
      Cash is Transferred to the Pledgor pursuant to Paragraph 3(b).

      (iii) Alternative to Interest Amount. The provisions of Paragraph 6(d)(ii)
will apply.                                             

(i)   Additional Representation(s). None.                                       

(j)   Other Eligible Support and Other Posted Support. "Value" and "Transfer"   
with respect to Other Eligible Support and Other Posted Support each
means: Not applicable.                                              

(k)   Demands and Notices                                                       

    All demands, specifications and notices to Party A under this Annex will
be made to:                                                         

Morgan Stanley Capital Services Inc.                    
1585 Broadway                                           
3rd Fl. - FID Controllers                               

New York, NY 10036                                      
Attn: FID Collateral Manager                            
Telephone No.: (212) 761-0877                           
Facsimile No.:  (212) 507-4949                          
Email: nydppgcoll@morganstanley.com                     

   and all demands, specifications and notices to Party B under this Annex
will be to:                                                         

     Deutsche Bank National Trust Company, as trustee of the Trust
1761 East St. Andrew Place                              
Santa Ana, California 92705-4934                        
Attention:  Trust Administration - MS06C1               
Facsimile:  (714) 247-6329                              
Phone:  (714) 247-6000                                  

; provided that any demand, specification or notice may be made by  
  telephone ("Telephone Notice") between employees of each party if such
    Telephone Notice is confirmed by a subsequent written instruction (which
    may be delivered via facsimile or email) by the close of business on the
same day that such Telephone Notice is given.                       

(l)   Addresses for Transfers.                                                  

Party A:                                                            
Cash:         CITIBANK, New York                                    
ABA No.:      021 000 089                                           
Account No.:  4072 - 4601                                           

Treasury Securities                                                 
and                                                                 
      Agency Notes: Bank of New York, New York/Morgan Stanley & Co. Incorporated
ABA No.:      021000018                                             

Other Forms of Eligible Collateral: As provided by Party A.         

Party B:                                                            

Cash: As provided by Party B                                        

DTC Eligible Securities:   As provided by Party B                   

(m)   Other Provisions.                                                         

(i)   Notwithstanding any other provision in this Agreement to the  
        contrary, no full or partial failure to exercise and no delay in
         exercising, on the part of Party A or Party B, any right, remedy,
            power or privilege permitted hereunder shall operate in any way as a
      waiver thereof by such party, including without limitation any
            failure to exercise or any delay in exercising to any or to the full
     extent of such party's rights with respect to transfer timing
       pursuant to Paragraph 4(b), regardless of the frequency of such
failure or delay.                                       

  (ii)  In all cases, in order to facilitate calculation of the Delivery
       Amount and the Return Amount for a particular Valuation Date in
accordance with Paragraph 3 of this Annex:              

(A)   Eligible Collateral;                              

(B)   Exposure; and                                     

(C)   Posted Collateral                                 

        shall each be expressed in US Dollars. If any of these items are
         expressed in a currency other than US Dollars, then they shall be
  converted into US Dollar amounts at the spot exchange rate
 determined by the Valuation Agent on that Valuation Date.

      (iii) Form of Annex. The parties hereby agree that the text of the body of
         this Annex is intended to be the printed form of 1994 ISDA Credit
           Support Annex (Bilateral Form - ISDA Agreements Subject to New York
           Law Only version) as published and copyrighted by the International
Swaps and Derivatives Association, Inc.                 

(n)   Agreement as to Single Secured Party and Pledgor. Party A and Party B     
  agree that, notwithstanding anything to the contrary in the recital to
     this Annex, Paragraph 1(b) or Paragraph 2 or the definitions of Paragraph
  12, (a) the term "Secured Party" as used in this Annex shall mean only
 Party B, (b) the term "Pledgor" as used in this Annex shall mean only
    Party A, (c) only Party A makes the pledge and grant in Paragraph 2, the
acknowledgement in the final sentence of Paragraph 8(a) and the     
   representations in paragraph 9 and (d) only Party A will be required to
make Transfers of Eligible Credit Support hereunder.                

(o)   Additional Definitions                                                    

    "Agency Notes" means U.S. Dollar-denominated fixed rate, non-amortising,
    non-mortgage-backed, senior debt securities of fixed maturity, rated Aaa
  by Moody's and AAA by S&P issued by any of the Federal Home Loan Banks
  (including their consolidated obligations issued through the Office of
Finance of the Federal Home Loan Bank System), the Federal National 
   Mortgage Association, the Federal Home Loan Mortgage Corporation or the
Federal Farm Credit Bank.                                           

"Commercial Paper" means U.S. Dollar-denominated, coupon-bearing,   
     commercial paper issued by a corporation, finance company, partnership or
limited liability company.                                          

"Treasury Securities" means U.S. Dollar-denominated, coupon-bearing,
     senior debt securities of the United States of America issued by the U.S.
     Treasury Department and backed by the full faith and credit of the United
States of America.                                                  

(p)   Trustee Capacity. It is expressly understood and agreed by the parties    
   hereto that insofar as this Annex is executed by Deutsche Bank National
   Trust Company (i) this Annex is executed and delivered by Deutsche Bank
National Trust Company not in its individual capacity but solely as 
Trustee under the PSA in the exercise of the powers and authority   
conferred and invested in it as trustee thereunder, (ii) each of the
     representations, undertakings and agreements herein made on behalf of the
     Trust is made and intended not as personal representations of the Trustee
   but is made and intended for the purpose of binding only the Trust, and
      (iii) under no circumstances shall Deutsche Bank National Trust Company in
its individual capacity be personally liable for the payment of any 
      indebtedness or expenses or be personally liable for the breach or failure
      of any obligation, representation, warranty or covenant made or undertaken
under this Annex.                                                   

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         IN WITNESS WHEREOF, the parties have executed this Credit Support
Annex by their duly authorized officers as of the date hereof.                  

                                        MORGAN STANLEY CAPITAL SERVICES INC.

                          By: /s/Nina C. Simmons
                                      ----------------------------
                                 Name: Nina C. Simmons
                                       Title: Authorized Signatory
                                  Date: January 27, 2006

                                         DEUTSCHE BANK NATIONAL TRUST COMPANY,
                                   not individually, but solely as
                                          Trustee for Morgan Stanley ABS Capital
                                   I Inc. Trust 2006-NC1, Mortgage
                                     Pass-Through Certificates, Series
            2006-NC1

                       By: /s/Eiko Akiyama
                                           ---------------------------------
                              Name: Eiko Akiyama
                            Title: Associate
                                  Date: January 27, 2006

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[LOGO OF MORGAN STANLEY]                                 EXECUTION COPY         
                                                --------------
--------------------------------------------------------------------------------

DATE:                   January 27, 2006                                        

TO:                     Deutsche Bank National Trust Company, not individually, 
                      but solely as Trustee for Morgan Stanley ABS Capital I
                        Inc. Trust 2006-NC1, Mortgage Pass-Through Certificates,
Series 2006-NC1                 

ATTENTION:              Trust Administration - MS06C1                           
TELEPHONE:              (714) 247-6000                                          
FACSIMILE:              (714) 247-6329                                          

FROM:                   Derivatives Documentation                               

TELEPHONE:              (212) 761-2996                                          
FACSIMILE:              (646) 202-9190                                          

SUBJECT:                Fixed Income Derivatives Confirmation                   

REFERENCE NUMBER:       FRPRW                                                   

The purpose of this letter agreement (this "Confirmation") is to confirm the    
terms and conditions of the Swap Transaction entered into on the Trade Date     
specified below (the "Transaction") between Morgan Stanley Capital Services Inc.
("Party A") and Deutsche Bank National Trust Company, not individually, but     
solely as Trustee ("Party B") under the Pooling and Servicing Agreement, dated  
and effective as of January 1, 2006, among Morgan Stanley ABS Capital I Inc., as
Depositor, Homeq Servicing Corporation, as Servicer, JPMorgan Chase Bank,       
National Association, as Servicer, Deutsche Bank National Trust Company, as     
Trustee, and NC Capital Corporation, as Responsible Party (the "PSA") for the   
Morgan Stanley ABS Capital I Inc. Trust 2006-NC1, Mortgage Pass-Through         
Certificates, Series 2006-NC1.                                                  

The definitions and provisions contained in the 2000 ISDA Definitions (the      
"Definitions"), as published by the International Swaps and Derivatives         
Association, Inc., are incorporated into this Confirmation. In the event of any 
inconsistency between the Definitions and this Confirmation, this Confirmation  
will govern. Terms capitalized but not defined in this Confirmation (including  
the Definitions) have the meanings attributed to them in the PSA.               

This Confirmation constitutes a "Confirmation" as referred to in, and           
supplements, forms part of and is subject to, the ISDA Master Agreement dated as
of January 27, 2006, as amended and supplemented from time to time (the         
"Agreement"), between Party A and Party B. All provisions contained in the      
Agreement govern this Confirmation except as expressly modified below.          

1.    The terms of the particular Transaction to which this Confirmation relates
are as follows:                                                     

Notional Amount:................... With respect to any  Calculation
                                        Period the amount set forth for such
                                    Calculation Period in Schedule I
                    attached hereto.

Trade Date:........................ January 13, 2006                

Effective Date:.................... January 27, 2006                

Termination Date:.................. August 25, 2010                 

Fixed Amounts:                                                      

Fixed Rate Payer:............ Party B                   

Fixed Rate Payer Payment                                
         Dates: ...................... The 25th calendar day of each month
                                        during the Term of this Transaction,
                                       commencing   February  25, 2006 and
                                   ending on the Termination Date,
                                       subject to adjustment in accordance
                                    with the Business Day Convention

Fixed Rate Payer Period End                             
           Dates:..................... The 25th calendar day of each month
                                        during the Term of this Transaction,
                                    commencing February 25, 2006 and
                                   ending on the Termination Date,
                             subject to No Adjustment.

Fixed Rate:.................. 4.75%                     

           Fixed Amount:................ To be determined  in accordance  with
                          the following formula:

                                       10 * Fixed Rate * Notional Amount *
                                  Fixed Rate Day Count Fraction.

Fixed Rate Day Count Fraction: 30/360                   

Floating Amounts:                                                   

Floating Rate Payer:......... Party A                   

Floating Rate Payer Payment                             
           Dates:..................... The 25th calendar day of each month
                                        during the Term of this Transaction,
                                    commencing February 25, 2006 and
                                   ending on the Termination Date,
                                       subject to adjustment in accordance
                                     with the Business Day Convention.

Floating Rate Payer Period                              
           End Dates:..................The 25th calendar day of each month
                                        during the Term of this Transaction,
                                    commencing February 25, 2006 and
                                   ending on the Termination Date,
                                       subject to adjustment in accordance
                                     with the Business Day Convention.

Floating Rate Option:........ USD-LIBOR-BBA             

Floating                                                
         Amount:...................... To be determined in accordance with
                            the following formula:

                                          10 * Floating Rate * Notional Amount *
                                     Floating Rate Day Count Fraction.

Designated Maturity:......... One month                 

Floating Rate Day                                       
Count Fraction:.............. Actual/360                

       Reset Dates:................. The first day of each Calculation
           Period.

Compounding:................. Inapplicable              

Business Days:..................... New York and Los Angeles        

Business Day Convention:........... Following                       

2.    Account Details and Settlement Information:                               

Payments to Party A:                                    

Citibank, New York                                      
ABA No.: 021 000 089                                    
Account No.: 4072-4601                                  
Account Name:  Morgan Stanley Capital Services Inc.     

Payments to Party B:                                    

Deutsche Bank                                           
ABA No.:  021001033                                     
Account No:  01419663                                   
Acct Name:  NYLTD Funds Control - Stars West            
Ref:  Morgan Stanley ABS Capital I Inc. 2006-NC1        

3.    Trustee Capacity. It is expressly understood and agreed by the parties    
 hereto that insofar as this Confirmation is executed by Deutsche Bank
     National Trust Company (i) this Confirmation is executed and delivered by
   Deutsche Bank National Trust Company not in its individual capacity but
solely as Trustee under the PSA in the exercise of the powers and   
      authority conferred and invested in it as trustee thereunder, (ii) each of
     the representations, undertakings and agreements herein made on behalf of
 the Trust is made and intended not as personal representations of the
Trustee but is made and intended for the purpose of binding only the
      Trust, and (iii) under no circumstances shall Deutsche Bank National Trust
      Company in its individual capacity be personally liable for the payment of
  any indebtedness or expenses or be personally liable for the breach or
   failure of any obligation, representation, warranty or covenant made or
undertaken under this Confirmation.                                 

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[LOGO OF MORGAN STANLEY]                                                        

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

We are very pleased to have entered into this Transaction with you and we look  
forward to completing other transactions with you in the near future.           

               Very truly yours,

                                  MORGAN STANLEY CAPITAL SERVICES INC.

                   By: /s/David N. Moore
                                          --------------------------------------
                         Name:  David N. Moore
                         Title: Vice President

Party B, acting through its duly authorized signatory, hereby agrees to, accepts
and confirms the terms of the foregoing as of the Trade Date.                   

                                       DEUTSCHE BANK NATIONAL TRUST COMPANY, not
                                       individually, but solely as Trustee
                                         for Morgan Stanley ABS Capital I Inc.
                                         Trust 2006-NC1, Mortgage Pass-Through
                                 Certificates, Series 2006-NC1

                       By: /s/Eiko Akiyama
                                             -----------------------------------
                             Name:  Eiko Akiyama
                          Title: Associate

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[LOGO OF MORGAN STANLEY]                                                        

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

SCHEDULE I
--------------------------------------------------------------------------------
Calculation Period         Notional Amount($)        Multiplier           
------------------         ------------------        ----------           
Effective Date 2/25/2006         123,128,699.66            10                   
2/25/2006      3/25/2006         118,476,773.23            10                   
3/25/2006      4/25/2006         113,972,495.34            10                   
4/25/2006      5/25/2006         109,608,287.03            10                   
5/25/2006      6/25/2006         105,377,188.00            10                   
6/25/2006      7/25/2006         101,272,848.46            10                   
7/25/2006      8/25/2006          97,289,484.84            10                   
8/25/2006      9/25/2006          93,421,870.17            10                   
9/25/2006      10/25/2006         89,665,310.88            10                   
10/25/2006     11/25/2006         86,015,622.20            10                   
11/25/2006     12/25/2006         82,469,122.13            10                   
12/25/2006     1/25/2007          79,022,611.32            10                   
1/25/2007      2/25/2007          75,673,408.06            10                   
2/25/2007      3/25/2007          72,466,973.72            10                   
3/25/2007      4/25/2007          69,397,398.71            10                   
4/25/2007      5/25/2007          66,458,801.82            10                   
5/25/2007      6/25/2007          63,645,556.09            10                   
6/25/2007      7/25/2007          60,952,277.78            10                   
7/25/2007      8/25/2007          58,373,815.80            10                   
8/25/2007      9/25/2007          55,894,915.42            10                   
9/25/2007      10/25/2007         53,257,862.97            10                   
10/25/2007     11/25/2007         16,893,306.75            10                   
11/25/2007     12/25/2007         16,272,688.37            10                   
12/25/2007     1/25/2008          15,674,922.86            10                   
1/25/2008      2/25/2008          15,099,164.71            10                   
2/25/2008      3/25/2008          14,544,599.93            10                   
3/25/2008      4/25/2008          14,010,444.81            10                   
4/25/2008      5/25/2008          13,495,943.32            10                   
5/25/2008      6/25/2008          13,000,177.69            10                   
6/25/2008      7/25/2008          12,522,658.00            10                   
7/25/2008      8/25/2008          12,062,709.78            10                   
8/25/2008      9/25/2008          11,579,396.15            10                   
9/25/2008      10/25/2008         10,303,055.07            10                   
10/25/2008     11/25/2008          9,342,853.37            10                   
11/25/2008     12/25/2008          9,011,487.65            10                   
12/25/2008     1/25/2009           8,691,788.13            10                   
1/25/2009      2/25/2009           8,383,346.82            10                   
2/25/2009      3/25/2009           8,085,769.92            10                   
3/25/2009      4/25/2009           7,798,677.29            10                   
4/25/2009      5/25/2009           7,521,696.90            10                   
5/25/2009      6/25/2009           7,254,475.79            10                   
6/25/2009      7/25/2009           6,996,676.85            10                   
7/25/2009      8/25/2009           6,747,970.10            10                   
8/25/2009      9/25/2009           6,508,037.03            10                   
9/25/2009      10/25/2009          6,276,570.20            10                   
10/25/2009     11/25/2009          6,053,272.09            10                   
11/25/2009     12/25/2009          5,837,855.56            10                   
12/25/2009     1/25/2010           5,630,045.97            10                   
1/25/2010      2/25/2010           5,429,576.52            10                   
2/25/2010      3/25/2010           5,236,189.72            10                   
3/25/2010      4/25/2010           5,049,637.04            10                   
4/25/2010      5/25/2010           4,869,678.64            10                   
5/25/2010      6/25/2010           4,696,083.02            10                   
6/25/2010      7/25/2010           4,528,626.75            10                   
7/25/2010      Termination Date    4,367,094.23            10                   

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[LETTERHEAD OF MORGAN STANLEY]

                                                                January 27, 2006

DEUTSCHE BANK NATIONAL TRUST COMPANY                                            
a national banking association, not individually,                               
but solely as Trustee for Morgan Stanley ABS Capital I Inc. Trust 2006-NC1,     
Mortgage Pass-Through Certificates, Series 2006-NC1                             
1761 East St. Andrew Place                                                      
Santa Ana, California 92705-4934                                                

Ladies and Gentlemen:                                                           

      In consideration of that certain ISDA Master Agreement dated as of January
27, 2006 between Morgan Stanley Capital Services Inc., a Delaware corporation   
(hereinafter "MSCS") and DEUTSCHE BANK NATIONAL TRUST COMPANY, a national       
banking association, not individually, but solely as Trustee for Morgan Stanley 
ABS Capital I Inc. Trust 2006-NC1, Mortgage Pass-Through Certificates, Series   
2006-NC1 (hereinafter "Counterparty") (such ISDA Master Agreement and ISDA      
Schedule, together with each Confirmation exchanged between the parties pursuant
thereto, hereinafter the "Agreement"), Morgan Stanley, a Delaware corporation   
(hereinafter "MS"), hereby irrevocably and unconditionally guarantees to        
Counterparty, with effect from the date of the Agreement, the due and punctual  
payment of all amounts payable by MSCS under the Agreement when the same shall  
become due and payable, whether on Scheduled Payment Dates, upon demand, upon   
declaration of termination or otherwise, in accordance with the terms of the    
Agreement and giving effect to any applicable grace period. Upon failure of MSCS
punctually to pay any such amounts, and upon written demand by Counterparty to  
MS at its address set forth in the signature block of this Guarantee (or to such
other address as MS may specify in writing), MS agrees to pay or cause to be    
paid such amounts; provided that delay by Counterparty in giving such demand    
shall in no event affect MS's obligations under this Guarantee.                 

      MS hereby agrees that its obligations hereunder shall be unconditional and
will not be discharged except by complete payment of the amounts payable under  
the Agreement, irrespective of any claim as to the Agreement's validity,        
regularity or enforceability or the lack of authority of MSCS to execute or     
deliver the Agreement; or any change in or amendment to the Agreement; or any   
waiver or consent by Counterparty with respect to any provisions thereof; or the
absence of any action to enforce the Agreement or the recovery of any judgment  
against MSCS or of any action to enforce a judgment against MSCS under the      
Agreement; or any similar circumstance which might otherwise constitute a legal 
or equitable discharge or defense of a guarantor generally. MS hereby waives    
diligence, presentment, demand on MSCS for payment or otherwise (except as      
provided hereinabove), filing of claims, requirement of a prior proceeding      
against MSCS and protest or notice, except as provided for in the Agreement with
respect to amounts payable by MSCS. If at any time payment under the Agreement  
is rescinded or must be otherwise restored or returned by Counterparty upon the 
insolvency, bankruptcy or reorganization of MSCS or MS or otherwise, MS's       
obligations hereunder with respect to such payment shall be reinstated upon such
restoration or return being made by Counterparty.                               

      MS represents to Counterparty as of the date hereof, which representations
will be deemed to be repeated by MS on each date on which a Transaction is      
entered into, that:                                                             

(1) it is duly organized and validly existing under the laws of the 
jurisdiction of its incorporation and has full power and legal right to execute 
and deliver this Guarantee and to perform the provisions of this Guarantee on   
its part to be performed;                                                       

   (2) its execution, delivery and performance of this Guarantee have been
and remain duly authorized by all necessary corporate action and do not         
contravene any provision of its certificate of incorporation or by-laws or any  
law, regulation or contractual restriction binding on it or its assets;         

  (3) all consents, authorizations, approvals and clearances (including,
without limitation, any necessary exchange control approval) and notifications, 
reports and registrations requisite for its due execution, delivery and         
performance of this Guarantee have been obtained from or, as the case may be,   
filed with the relevant governmental authorities having jurisdiction and remain 
in full force and effect and all conditions thereof have been duly complied with
and no other action by, and no notice to or filing with, any governmental       
authority having jurisdiction is required for such execution, delivery or       
performance; and                                                                

     (4) this Guarantee is its legal, valid and binding obligation enforceable
against it in accordance with its terms except as enforcement hereof may be     
limited by applicable bankruptcy, insolvency, reorganization or other similar   
laws affecting the enforcement of creditors' rights or by general equity        
principles.                                                                     

     By accepting this Guarantee and entering into the Agreement, Counterparty
agrees that MS shall be subrogated to all rights of Counterparty against MSCS in
respect of any amounts paid by MS pursuant to this Guarantee, provided that MS  
shall be entitled to enforce or to receive any payment arising out of or based  
upon such right of subrogation only to the extent that it has paid all amounts  
payable by MSCS under the Agreement.                                            

    This Guarantee shall be governed by and construed in accordance with the
laws of the State of New York. All capitalized terms not otherwise defined      
herein shall have the respective meanings assigned to them in the Agreement.    

          MORGAN STANLEY

                        By:  /s/ Jacqueline T. Brody
                             ---------------------------
                              Name:  Jacqueline T. Brody
                              Title: Assistant Treasurer

                    Address:   1585 Broadway
                            10th Floor
                                     New York, NY  10036
                            Attention: Fixed Income Division
                                              Transaction Management Group
                   Fax No.:   212-507-4622

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 EXHIBIT U

================================================================================

 THIRD AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND
WARRANTIES AGREEMENT

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

 MORGAN STANLEY MORTGAGE CAPITAL INC.,

 Purchaser

 NC CAPITAL CORPORATION,

Seller

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

Dated as of December 1, 2005

 Conventional,
 Fixed and Adjustable Rate, B/C Residential Mortgage Loans

================================================================================

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TABLE OF CONTENTS   

SECTION 1.     DEFINITIONS..................................................    

SECTION 2.     AGREEMENT TO PURCHASE........................................    

SECTION 3.     MORTGAGE SCHEDULES...........................................    

SECTION 4.     PURCHASE PRICE...............................................    

SECTION 5.     EXAMINATION OF MORTGAGE FILES................................    

SECTION 6.     CONVEYANCE FROM SELLER TO PURCHASER..........................    

SECTION 7.     SERVICING OF THE MORTGAGE LOANS..............................    

SECTION 8.     TRANSFER OF SERVICING........................................    

SECTION 9.     REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SELLER;         
           REMEDIES FOR BREACH..........................................

SECTION 10.    CLOSING......................................................    

SECTION 11.    CLOSING DOCUMENTS............................................    

SECTION 12.    COSTS........................................................    

SECTION 13.    COOPERATION OF SELLER WITH A RECONSTITUTION..................    

SECTION 14.    THE SELLER...................................................    

SECTION 15.    FINANCIAL STATEMENTS.........................................    

SECTION 16.    MANDATORY DELIVERY; GRANT OF SECURITY INTEREST...............    

SECTION 17.    NOTICES......................................................    

SECTION 18.    SEVERABILITY CLAUSE..........................................    

SECTION 19.    COUNTERPARTS.................................................    

SECTION 20.    GOVERNING LAW................................................    

SECTION 21.    INTENTION OF THE PARTIES.....................................    

SECTION 22.    SUCCESSORS AND ASSIGNS; ASSIGNMENT OF PURCHASE AGREEMENT.....    

SECTION 23.    WAIVERS......................................................    

SECTION 24.    EXHIBITS.....................................................    

SECTION 25.    GENERAL INTERPRETIVE PRINCIPLES..............................    

SECTION 26.    REPRODUCTION OF DOCUMENTS....................................    

SECTION 27.    FURTHER AGREEMENTS...........................................    

SECTION 28.    RECORDATION OF ASSIGNMENTS OF MORTGAGE.......................    

SECTION 29.    NO SOLICITATION..............................................    

SECTION 30.    WAIVER OF TRIAL BY JURY......................................    

SECTION 31.    SUBMISSION TO JURISDICTION; WAIVERS..........................    

SECTION 32.    COMPLIANCE WITH REGULATION AB................................    

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EXHIBITS  

EXHIBIT A   CONTENTS OF EACH MORTGAGE FILE                                      

EXHIBIT B   [RESERVED]                                                          

EXHIBIT C   FORM OF SELLER'S OFFICER'S CERTIFICATE                              

EXHIBIT D   FORM OF OPINION OF COUNSEL TO THE SELLER AND ORIGINATOR             

EXHIBIT E   FORM OF SECURITY RELEASE CERTIFICATION                              

EXHIBIT F   FORM OF SECURITY RELEASE CERTIFICATION                              

EXHIBIT G   UNDERWRITING GUIDELINES                                             

EXHIBIT H   FORM OF ASSIGNMENT AND CONVEYANCE AGREEMENT                         

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THIRD AMENDED AND RESTATED MORTGAGE LOAN
 PURCHASE AND WARRANTIES AGREEMENT

  This THIRD AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AND
WARRANTIES AGREEMENT (the "Agreement"), dated as of December 1, 2005, by and    
between Morgan Stanley Mortgage Capital Inc., a New York corporation, having an 
office at 1585 Broadway, 2nd Floor, New York, New York 10036 (the "Purchaser")  
and NC Capital Corporation, a California corporation, having an office at 18400 
Von Karman, Suite 1000, Irvine, CA 92612 (the "Seller").                        

W I T N E S S E T H:  
- - - - - - - - - -   

         WHEREAS, the Purchaser and the Seller are parties to that certain
Second Amended and Restated Mortgage Loan Purchase and Warranties Agreement,    
dated as of December 1, 2003, as amended by Amendment No. 1, dated as of October
22, 2003, Amendment No. 2, dated as of December 30, 2003, Amendment No. 3, dated
as of January 29, 2004, Amendment No. 4, dated as of March 30, 2004, Amendment  
No. 5, dated as of June 28, 2004 and Amendment No. 6, dated as of January 28,   
2005 (the "Original Purchase Agreement"), pursuant to which the Seller may sell,
from time to time, to the Purchaser, and the Purchaser may purchase, from time  
to time, from the Seller, certain conventional adjustable and fixed rate B/C,   
residential first and second mortgage loans (the "Mortgage Loans") as described 
therein, and which shall be delivered in pools of whole loans (each, a "Mortgage
Loan Package") on various dates as provided therein (each, a "Closing Date");   

            WHEREAS, at the present time, the Purchaser and the Seller desire to
amend the Original Purchase Agreement to make certain modifications as set forth
herein:                                                                         

   NOW, THEREFORE, in consideration of the premises and mutual
agreements set forth herein, and for other good and valuable consideration, the 
receipt and sufficiency of which are hereby acknowledged, the Purchaser and the 
Seller agree as follows:                                                        

SECTION 1. Definitions.                                 

            For purposes of this Agreement the following capitalized terms shall
have the respective meanings set forth below.                                   

        Accepted Servicing Practices: With respect to any Mortgage Loan,
those mortgage servicing practices of prudent mortgage lending institutions     
which service mortgage loans of the same type as such Mortgage Loan in the      
jurisdiction where the related Mortgaged Property is located and incorporating  
the Delinquency Collection Policies and Procedures.                             

    Act: The National Housing Act, as amended from time to time.

       Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan
purchased pursuant to this Agreement.                                           

         Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any    
specified Person means the power to direct the management and policies of such  
Person, directly or indirectly, whether through the ownership of voting         
securities, by contract or otherwise and the terms "controlling" and            
"controlled" have meanings correlative to the foregoing.                        

         Agency Transfer: A Fannie Mae Transfer or a Freddie Mac Transfer.

         Agreement: This Third Amended and Restated Mortgage Loan Purchase
and Warranties Agreement and all amendments hereof and supplements hereto.      

           ALTA: The American Land Title Association or any successor thereto.

           Ancillary Income: All late charges, assumption fees, escrow account
benefits, reinstatement fees, and similar types of fees arising from or in      
connection with any Mortgage, to the extent not otherwise payable to the        
Mortgagor under applicable law or pursuant to the terms of the related Mortgage 
Note.                                                                           

    Appraised Value: The value set forth in an appraisal made in
connection with the origination of the related Mortgage Loan as the value of the
Mortgaged Property.                                                             

           Assignment and Conveyance Agreement: As defined in Subsection 6.01.

        Assignment of Mortgage: 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.                                      

            Balloon Mortgage Loan: Any Mortgage Loan which by its original terms
or any modifications thereof provides for amortization beyond its scheduled     
maturity date.                                                                  

BIF: The Bank Insurance Fund, or any successor thereto. 

         Business Day: Any day other than (i) a Saturday or Sunday, (ii) a
day on which banking and savings and loan institutions, in the State of New York
or the State in which the Originator's servicing operations are located or (iii)
the state in which the Custodian's operations are located, are authorized or    
obligated by law or executive order to be closed.                               

           Closing Date: The date or dates on which the Purchaser from time to
time shall purchase, and the Seller from time to time shall sell, the Mortgage  
Loans listed on the related Mortgage Loan Schedule with respect to the related  
Mortgage Loan Package.                                                          

       CLTV: As of any date and as to any Second Lien Loan, the ratio,
expressed as a percentage, of the (a) sum of (i) the outstanding principal      
balance of the Second Lien Loan and (ii) the outstanding principal balance as of
such date of any mortgage loan or mortgage loans that are senior or equal in    
priority to the Second Lien Loan and which are secured by the same Mortgaged    
Property to (b) the Appraised Value as determined pursuant to the Underwriting  
Guidelines of the related Mortgaged Property as of the origination of the Second
Lien Loan.                                                                      

Code: Internal Revenue Code of 1986, as amended.        

         Commission: The United States Securities and Exchange Commission.

        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.                                                

          Convertible Mortgage Loan: Any individual Adjustable Rate Mortgage
Loan purchased pursuant to this Agreement which contains a provision whereby the
Mortgagor is permitted to convert the Adjustable Rate Mortgage Loan to a Fixed  
Rate Mortgage Loan in accordance with the terms of the related Mortgage Note.   

        Covered Loan: A Mortgage Loan categorized as Covered pursuant to
Appendix E of Standard & Poor's Glossary.                                       

            Custodial Account: The separate trust account created and maintained
pursuant to Section 2.04 of the Servicing Agreement (with respect to each       
Mortgage Loan, as specified therein).                                           

            Custodial Agreement: The agreement(s) governing the retention of the
originals of each Mortgage Note, Mortgage, Assignment of Mortgage and other     
Mortgage Loan Documents. If more than one Custodial Agreement is in effect at   
any given time, all of the individual Custodial Agreements shall collectively be
referred to as the "Custodial Agreement".                                       

           Custodian: Deutsche Bank Trust Company Americas, or the Custodian's
successor in interest or permitted assigns, or any successor to the Custodian   
under the Custodial Agreement as therein provided.                              

         Cut-off Date: The date or dates designated as such on the related
Mortgage Loan Schedule with respect to the related Mortgage Loan Package.       

     Deleted Mortgage Loan: A Mortgage Loan that is repurchased or
replaced or to be replaced with a Qualified Substitute Mortgage Loan by the     
Seller in accordance with the terms of this Agreement.                          

           Depositor: The depositor, as such term is defined in Regulation AB,
with respect to any Securitization Transaction.                                 

         Determination Date: The date specified in the Servicing Agreement
(with respect to each Mortgage Loan, for an interim period, as specified        
therein).                                                                       

          Due Date: The 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 and any Mortgage
Loan, the period commencing on the day immediately succeeding the Due Date for  
such Mortgage Loan occurring in the month preceding the month of the Remittance 
Date and ending on the next Due Date.                                           

         Equity Take-Out Refinanced Mortgage Loan: A Mortgage Loan used to
refinance an existing mortgage loan, the proceeds of which were in excess of the
outstanding principal balance of the existing mortgage loan.                    

            Escrow Account: The separate account created and maintained pursuant
to Section 2.06 of the Servicing Agreement (with respect to each Mortgage Loan, 
as specified therein).                                                          

       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 document.

      Exchange Act: The Securities Exchange Act of 1934, as amended.

   Fannie Mae: Fannie Mae, f/k/a the Federal National Mortgage
Association, or any successor thereto.                                          

           Fannie Mae Guides: The Fannie Mae Sellers' Guide and the Fannie Mae
Servicers' Guide and all amendments or additions thereto.                       

Fannie Mae Transfer: As defined in Section 13 hereof.   

         FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.                                                                        

            FHA: The Federal Housing Administration, an agency within the United
States Department of Housing and Urban Development, or any successor thereto and
including the Federal Housing Commissioner and the Secretary of Housing and     
Urban Development where appropriate under the FHA Regulations.                  

          FHA Approved Mortgagee: A corporation or institution approved as a
mortgagee by the FHA under the Act, and applicable HUD regulations, and eligible
to own and service mortgage loans such as the FHA mortgage loans.               

            First Lien Loan: A Mortgage Loan secured by a first lien Mortgage on
the related Mortgaged Property.                                                 

Fitch: Fitch, Inc., or its successor in interest.       

      Fixed Rate Mortgage Loan: A fixed rate mortgage loan purchased
pursuant to this Agreement.                                                     

      Freddie Mac: Freddie Mac, f/k/a the Federal Home Loan Mortgage
Corporation, or any successor thereto.                                          

Freddie Mac Transfer: As defined in Section 13 hereof.  

         Gross Margin: With respect to each Adjustable Rate Mortgage Loan,
the fixed percentage amount set forth in the related Mortgage Note which amount 
is added to the Index in accordance with the terms of the related Mortgage Note 
to determine on each Interest Rate Adjustment Date the Mortgage Interest Rate   
for such Mortgage Loan.                                                         

            High Cost Loan: A Mortgage Loan classified as (a) a "high cost" loan
under the Home Ownership and Equity Protection Act of 1994 or (b) 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.                                       

            HUD: The Department of Housing and Urban Development, or any federal
agency or official thereof which may from time to time succeed to the functions 
thereof with regard to FHA Mortgage Insurance. The term "HUD," for purposes of  
this Agreement, is also deemed to include subdivisions thereof such as the FHA  
and Government National Mortgage Association.                                   

        Index: The index indicated in the related Mortgage Note for each
Adjustable Rate Mortgage Loan.                                                  

           Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.

            Insured Depository Institution: Insured Depository Institution shall
have the meaning ascribed to such term by Section 1813(c)(2) of Title 12 of the 
United States Code, as amended from time to time.                               

           Interest Rate Adjustment Date: With respect to each Adjustable Rate
Mortgage Loan, the date, specified in the related Mortgage Note and the related 
Mortgage Loan Schedule, on which the Mortgage Interest Rate is adjusted.        

            Lifetime Rate Cap: The provision of each Mortgage Note related to an
Adjustable Rate Mortgage Loan which provides for an absolute maximum Mortgage   
Interest Rate thereunder. The Mortgage Interest Rate during the terms of each   
Adjustable Rate Mortgage Loan shall not at any time exceed the Mortgage Interest
Rate at the time of origination of such Adjustable Rate Mortgage Loan by more   
than the Lifetime Rate Cap set forth as an amount per annum on the related      
Mortgage Loan Schedule.                                                         

     Limited Documentation Program: The guidelines under which the
Originator generally originates Mortgage Loans principally on the basis of the  
Loan-to-Value Ratio of the related Mortgage Loan and the creditworthiness of the
Mortgagor.                                                                      

  Liquidation Proceeds: Cash 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 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 or LTV: With respect to any Mortgage Loan, the
ratio (expressed as a percentage) of the outstanding principal amount of the    
Mortgage Loan as of the related Cut-off Date (unless otherwise indicated), to   
the lesser of (a) the Appraised Value of the Mortgaged Property at origination  
and (b) if the Mortgage Loan was made to finance the acquisition of the related 
Mortgaged Property, the purchase price 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 Mortgagor or may be on leased land.                                         

       Monthly Payment: The scheduled monthly payment of principal and
interest on a Mortgage Loan.                                                    

            Moody's: Moody's Investors Service, Inc., and any successor thereto.

            Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note, which creates a first lien, in the case of a First Lien Loan, or 
a second lien, in the case of a Second Lien Loan, on an unsubordinated estate in
fee simple in real property securing the Mortgage Note; except that with respect
to real property located in jurisdictions in which the use of leasehold estates 
for residential properties is a widely-accepted practice, the mortgage, deed of 
trust or other instrument securing the Mortgage Note may secure and create, with
respect to a First Lien Loan, a first lien, and with respect to a Second Lien   
Loan, a second lien, in each case, upon a leasehold estate of the Mortgagor.    

         Mortgage File: The items pertaining to a particular Mortgage Loan
referred to in Exhibit A 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 with respect to each Mortgage Loan.                               

      Mortgage Interest Rate Cap: With respect to an Adjustable Rate
Mortgage Loan, the limit on each Mortgage Interest Rate adjustment as set forth 
in the related 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 applicable Mortgage Loan Schedule, which Mortgage Loan  
includes without limitation the Mortgage File, the Monthly Payments, Principal  
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,   
Servicing Rights and all other rights, benefits, proceeds and obligations       
arising from or in connection with such Mortgage Loan, excluding replaced or    
repurchased mortgage loans.                                                     

          Mortgage Loan Documents: The documents required to be delivered to
the Custodian pursuant to Subsection 6.03 hereof with respect to any Mortgage   
Loan.                                                                           

          Mortgage Loan Package: Each pool of Mortgage Loans, which shall be
purchased by the Purchaser from the Seller from time to time on each Closing    
Date.                                                                           

            Mortgage Loan Schedule: The schedule of Mortgage Loans setting forth
the following information with respect to each Mortgage Loan in the related     
Mortgage Loan Package: (1) the Seller's Mortgage Loan identifying number; (2)   
the Mortgagor's name; (3) the street address of the Mortgaged Property including
the city, state and zip code; (4) a code indicating whether the Mortgagor is    
self-employed; (5) a code indicating whether the Mortgaged Property is          
owner-occupied; (6) the number and type of residential units constituting the   
Mortgaged Property; (7) the original months to maturity or the remaining months 
to maturity from the related Cut-off Date, in any case based on the original    
amortization schedule and, if different, the maturity expressed in the same     
manner but based on the actual amortization schedule; (8) with respect to each  
First Lien Loan, the Loan-to-Value Ratio at origination, and with respect to    
each Second Lien Loan, the CLTV at origination; (9) the Mortgage Interest Rate  
as of the related Cut-off Date; (10) the date on which the Monthly Payment was  
due on the Mortgage Loan and, if such date is not consistent with the Due Date  
currently in effect, such Due Date; (11) the stated maturity date; (12) the     
first payment date; (13) the amount of the Monthly Payment as of the related    
Cut-off Date; (14) the last payment date on which a payment was actually applied
to the outstanding principal balance; (15) the original principal amount of the 
Mortgage Loan; (16) the principal balance of the Mortgage Loan as of the close  
of business on the related Cut-off Date, after deduction of payments of         
principal due and collected on or before the related Cut-off Date; (17) with    
respect to each Second Lien Loan and First Lien Loan with a second lien behind  
it, the combined principal balance of the Mortgage Loan as of the close of      
business on the related Cut-off Date, after deduction of payments of principal  
due and collected on or before the related Cut-off Date; (18) a code indicating 
whether there is a simultaneous second; (19) delinquency status as of the       
related Cut-off Date; (20) with respect to each Adjustable Rate Mortgage Loan,  
the Interest Rate Adjustment Date; (21) with respect to each Adjustable Rate    
Mortgage Loan, the Gross Margin; (22) with respect to each Adjustable Rate      
Mortgage Loan , the Lifetime Rate Cap under the terms of the Mortgage Note; (23)
with respect to each Adjustable Rate Mortgage Loan, a code indicating the type  
of Index; (24) the type of Mortgage Loan (i.e., Fixed Rate or Adjustable Rate   
Mortgage Loan, First or Second Lien Loan); (25) a code indicating the purpose of
the loan (i.e., purchase, rate and term refinance, equity take-out refinance);  
(26) a code indicating the documentation style (i.e., full, alternative or      
reduced); (27) the loan credit classification (as described in the Underwriting 
Guidelines); (28) whether such Mortgage Loan provides for a prepayment penalty  
and, if applicable, the prepayment penalty period; (29) the Mortgage Interest   
Rate as of origination; (30) the credit risk score (FICO score); (31) the date  
of origination; (32) with respect to each Adjustable Rate Mortgage Loan, the    
Mortgage Interest Rate adjustment period; (33) with respect to each Adjustable  
Rate Mortgage Loan, the Mortgage Interest Rate adjustment percentage; (34) with 
respect to each Adjustable Rate Mortgage Loan, the Mortgage Interest Rate floor;
(35) with respect to each Adjustable Rate Mortgage Loan, the Mortgage Interest  
Rate Cap as of the first Interest Rate Adjustment Date; (36) with respect to    
each Adjustable Rate Mortgage Loan, the Periodic Rate Cap subsequent to the     
first Interest Rate Adjustment Date; (37) a code indicating whether the Mortgage
Loan is a High Cost Loan; (38) a code indicating whether the Mortgage Loan is a 
Balloon Mortgage Loan; (39) the Due Date for the first Monthly Payment; (40) the
original Monthly Payment due; (41) with respect to the related Mortgagor, the   
debt-to-income ratio; (42) sales price; (43) Appraised Value; (44) appraisal    
type; (45) appraisal date; and (46) a code indicating whether the Mortgage Loan 
is a Home Loan. With respect to the Mortgage Loans in the aggregate, the        
Mortgage Loan Schedule shall set forth the following information, as of the     
related Cut-off Date: (1) the number of Mortgage Loans; (2) the current         
aggregate outstanding principal balance of the Mortgage Loans; (3) the weighted 
average Mortgage Interest Rate of the Mortgage Loans; (4) the weighted average  
maturity of the Mortgage Loans; (5) the applicable Cut-off Date; and (6) the    
applicable Closing Date.                                                        

          Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.                                                

        Mortgaged Property: With respect to each Mortgage Loan, the real
property (or leasehold estate, if applicable) securing repayment of the debt    
evidenced by the related Mortgage Note.                                         

Mortgagor: The obligor on a Mortgage Note.              

     Non-Convertible Mortgage Loan: Any individual Adjustable Rate
Mortgage Loan purchased pursuant to this Agreement which does not contain a     
provision pursuant to which the Mortgagor may convert the Adjustable Rate       
Mortgage Loan to a Fixed Rate Mortgage Loan.                                    

          Nonrecoverable Advance: Any advance previously made or proposed to
be made in respect of a Mortgage Loan which, in the good faith judgment of the  
Originator, will not or, in the case of a proposed advance, would not, be       
ultimately recoverable from related Insurance Proceeds, Liquidation Proceeds or 
otherwise. The determination by the Originator that it has made a Nonrecoverable
Advance or that any proposed advance of principal and interest, if made, would  
constitute a Nonrecoverable Advance, shall be evidenced by an Officers'         
Certificate delivered to the Purchaser.                                         

         OCC: Office of the Comptroller of the Currency, and any successor
thereto.                                                                        

          Officer's Certificate: A certificate signed by the Chairman of the
Board or the Vice Chairman of the Board or a President or a Vice President and  
by the Treasurer or the Secretary or one of the Assistant Treasurers or         
Assistant Secretaries of the Seller, and delivered to the Purchaser as required 
by this Agreement.                                                              

            Opinion of Counsel: A written opinion of counsel, who may be counsel
for the Seller, reasonably acceptable to the Purchaser, provided that any       
Opinion of Counsel relating to (a) the qualification of any account required to 
be maintained pursuant to this Agreement as an Eligible Account, (b)            
qualification of the Mortgage Loans in a REMIC or (c) compliance with the REMIC 
Provisions, must be (unless otherwise stated in such Opinion of Counsel) an     
opinion of counsel who (i) is in fact independent of the Seller and any servicer
of the Mortgage Loans, (ii) does not have any material direct or indirect       
financial interest in the Seller or any servicer of the Mortgage Loans or in an 
Affiliate of either and (iii) is not connected with the Seller or any servicer  
of the Mortgage Loans as an officer, employee, director or person performing    
similar functions.                                                              

       Originator: New Century Mortgage Corporation, its successors in
interest and assigns.                                                           

            Periodic Rate Cap: The provision of each Mortgage Note related to an
Adjustable Rate Mortgage Loan which provides for an absolute maximum amount by  
which the Mortgage Interest Rate therein may increase or decrease on an Interest
Rate Adjustment Date above or below the Mortgage Interest Rate previously in    
effect. The Periodic Rate Cap for each Adjustable Rate Mortgage Loan is the rate
set forth as such on the related Mortgage Loan Schedule.                        

           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.        

Preliminary Mortgage Schedule:  As defined in Section 3.

           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.             

         Purchase Price: The price paid on the related Closing Date by the
Purchaser to the Seller in exchange for the Mortgage Loans purchased on such    
Closing Date as calculated in Section 4 of this Agreement.                      

            Purchase Price and Terms Agreement: Those certain agreements setting
forth the general terms and conditions of the transactions consummated herein   
and identifying the Mortgage Loans to be purchased from time to time hereunder, 
by and between the Seller, the Originator and the Purchaser.                    

            Purchaser: Morgan Stanley Mortgage Capital Inc., or its successor in
interest or assigns or any successor to the Purchaser under this Agreement as   
herein provided.                                                                

          Qualified Appraiser: An appraiser, duly appointed by the Seller or
the Originator, who had no interest, direct or indirect, in the Mortgaged       
Property or in any loan made on the security thereof, and whose compensation was
not affected by the approval or disapproval of the Mortgage Loan, and such      
appraiser and the appraisal made by such appraiser both satisfied the           
requirements of Title XI of the Financial Institutions Reform, Recovery, and    
Enforcement Act of 1989 and the regulations promulgated thereunder, all as in   
effect on the date the Mortgage Loan was originated.                            

           Qualified Correspondent: Any Person from which the Seller purchased
Mortgage Loans, provided that the following conditions are satisfied: (i) such  
Mortgage Loans were originated pursuant to an agreement between the Seller and  
such Person that contemplated that such Person would underwrite mortgage loans  
from time to time, for sale to the Seller, in accordance with underwriting      
guidelines designated by the Seller ("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 Seller within 180 days after origination; (iii) either (x) the Designated   
Guidelines were, at the time such Mortgage Loans were originated, used by the   
Seller in origination of mortgage loans of the same type as the Mortgage Loans  
for the Seller's own account or (y) the Designated Guidelines were, at the time 
such Mortgage Loans were underwritten, designated by the Seller on a consistent 
basis for use by lenders in originating mortgage loans to be purchased by the   
Seller; and (iv) the Seller employed, at the time such Mortgage Loans were      
acquired by the Seller, 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 Seller.            

            Qualified Insurer: An insurance company duly qualified as such under
the laws of the states in which the Mortgaged Properties are located, duly      
authorized and licensed in such states to transact the applicable insurance     
business and to write the insurance provided, approved as an insurer by Fannie  
Mae and Freddie Mac and whose claims paying ability is rated in the highest     
rating category by any of the Rating Agencies with respect to primary mortgage  
insurance and in the two highest rating categories by Best's with respect to    
hazard and flood insurance (or such other rating as may be required by a Rating 
Agency in connection with a Securitization Transaction in order to achieve the  
desired ratings for the securities to be issued in connection with such         
Securitization Transaction).                                                    

          Qualified Substitute Mortgage Loan: A mortgage loan eligible to be
substituted by the Seller for a Deleted Mortgage Loan which must, on the date of
such substitution, (i) have an outstanding principal balance, after deduction of
all scheduled payments due in the month of substitution (or in the case of a    
substitution of more than one mortgage loan for a Deleted Mortgage Loan, an     
aggregate principal balance), not in excess of the outstanding principal balance
of the Deleted Mortgage Loan (the amount of any shortfall will be deposited in  
the Custodial Account by the Seller in the month of substitution); (ii) have a  
Mortgage Interest Rate not less than and not more than 1% greater than the      
Mortgage Interest Rate of the Deleted Mortgage Loan; (iii) have a remaining term
to maturity not greater than and not more than one year less than that of the   
Deleted Mortgage Loan; (iv) be of the same type as the Deleted Mortgage Loan    
(i.e., fixed rate or adjustable rate with same Mortgage Interest Rate Caps); and
(v) comply with each representation and warranty (respecting individual Mortgage
Loans) set forth in Section 9 hereof.                                           

           Rating Agency: Any of Fitch, Moody's or Standard & Poor's, or their
respective successors designated by the Purchaser.                              

 Reconstitution: A Whole Loan Transfer or a Securitization
Transaction.                                                                    

           Reconstitution Agreements: The agreement or agreements entered into
by the Seller and/or the Originator and the Purchaser and/or certain third      
parties on the Reconstitution Date or Dates with respect to any or all of the   
Mortgage Loans sold hereunder, in connection with a Whole Loan Transfer, Agency 
Transfer or a Securitization Transaction pursuant to Section 13, including, but 
not limited to, a seller's warranties and servicing agreement with respect to a 
Whole Loan Transfer, and a pooling and servicing agreement and/or               
seller/servicer agreements and related custodial/trust agreement and documents  
with respect to a Securitization Transaction.                                   

Reconstitution Date: As defined in Section 13.          

 Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.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 Date: The date specified in the Servicing Agreement (with
respect to each Mortgage Loan, as specified therein).                           

            Repurchase Price: As defined in the related Purchase Price and Terms
Agreement.                                                                      

          RESPA: Real Estate Settlement Procedures Act, as amended from time
to time.                                                                        

           Second Lien Loan: A Mortgage Loan secured by a second lien Mortgage
on the related Mortgaged Property.                                              

Securities Act: The Securities Act of 1933, as amended. 

          Securitization Transaction: Any transaction involving either (1) a
sale or other transfer of some or all of the Mortgage Loans directly or         
indirectly to an issuing entity in connection with an issuance of publicly      
offered or privately placed, rated or unrated mortgage-backed securities or (2) 
an issuance of publicly offered or privately placed, rated or unrated           
securities, the payments on which are determined primarily by reference to one  
or more portfolios of residential mortgage loans consisting, in whole or in     
part, of some or all of the Mortgage Loans.                                     

      Seller: NC Capital Corporation, its successors in interest and
assigns.                                                                        

Seller Information: As defined in Subsection 32.04(a).  

       Servicing Agreement: The Amended and Restated Interim Servicing
Agreement, dated as of December 1, 2005, between the Purchaser and the          
Originator, providing for the Originator to service the Mortgage Loans as       
specified in the Servicing Agreement.                                           

        Servicing Fee: With respect to each Mortgage Loan subject to the
Servicing Agreement, a fee payable monthly equal to one-twelfth of the product  
of (a) the Servicing Fee Rate and (b) the outstanding principal balance of such 
Mortgage Loan. Such fee shall be payable monthly and shall be pro-rated for any 
portion of a month during which the Mortgage Loan is serviced by the Originator 
under the Servicing Agreement. 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 this Agreement) of such Monthly Payment    
collected by the Originator, or as otherwise provided under this Agreement.     

   Servicing Fee Rate: An amount per annum as set forth in the
Servicing Agreement.                                                            

    Servicing File: With respect to each Mortgage Loan, the file
retained by the Originator consisting of originals of all documents in the      
Mortgage File which are not delivered to the Purchaser or the Custodian and     
copies of the Mortgage Loan Documents set forth in Section 2 of the Custodial   
Agreement.                                                                      

       Servicing Rights: Any and all of the following: (a) any and all
rights to service the Mortgage Loans; (b) any payments to or monies received by 
the Seller for servicing the Mortgage Loans; (c) any late fees, penalties or    
similar payments with respect to the Mortgage Loans; (d) all agreements or      
documents creating, defining or evidencing any such servicing rights to the     
extent they relate to such servicing rights and all rights of the Seller        
thereunder; (e) Escrow Payments or other similar payments with respect to the   
Mortgage Loans and any amounts actually collected by the Seller with respect    
thereto; (f) all accounts and other rights to payment related to any of the     
property described in this paragraph; and (g) any and all documents, files,     
records, servicing files, servicing documents, servicing records, data tapes,   
computer records, or other information pertaining to the Mortgage Loans or      
pertaining to the past, present or prospective servicing of the Mortgage Loans. 

            Sponsor: The sponsor, as such term is defined in Regulation AB, with
respect to any Securitization Transaction.                                      

            Standard & Poor's: Standard & Poor's Ratings Services, a division of
The McGraw-Hill Companies Inc., and any successor thereto.                      

   Standard & Poor's Glossary: The Standard & Poor's LEVELS(R)
Glossary, as may be in effect from time to time.                                

         Stated Principal Balance: As to each Mortgage Loan on any date of
determination, (i) the principal balance of such Mortgage Loan at the related   
Cut-off Date after giving effect to payments of principal due on or before such 
date, to the extent actually received, minus (ii) all amounts previously        
distributed to the Purchaser with respect to the related Mortgage Loan          
representing payments or recoveries of principal on such Mortgage Loan.         

        Static Pool Information: Static pool information as described in
Item 1105(a)(1)-(3) and 1105(c) of Regulation AB.                               

      Successor Servicer: Any servicer of one or more Mortgage Loans
designated by the Purchaser as being entitled to the benefits of the            
indemnifications set forth in Sections 9.03 and 14.01.                          

   Third-Party Originator: Each Person, other than a Qualified
Correspondent, that originated Mortgage Loans acquired by the Seller.           

        Transfer Date: The date on which the Purchaser, or its designee,
shall receive the transfer of servicing responsibilities and begin to perform   
the servicing of the Mortgage Loans with respect to the related Mortgage Loan   
Package, and the Seller shall cease all servicing responsibilities. Such date   
shall occur on the day indicated by the Purchaser to the Seller in accordance   
with the Servicing Agreement.                                                   

   Underwriting Guidelines: The underwriting guidelines of the
Originator, a copy of which is attached hereto as Exhibit G and a then-current  
copy of which shall be attached as an exhibit to the related Assignment and     
Conveyance.                                                                     

         VA Approved Lender: Those lenders which are approved by the VA to
act as a lender in connection with the origination of VA mortgage loans.        

          Whole Loan Agreement: Any Reconstitution Agreement in respect of a
Whole Loan Transfer.                                                            

       Whole Loan Transfer: Any sale or transfer of some or all of the
Mortgage Loans, other than a Securitization Transaction.                        

SECTION 2. Agreement to Purchase.                       

      The Seller agrees to sell from time to time, and the Purchaser
agrees to purchase from time to time, Mortgage Loans having an aggregate        
principal balance on the related Cut-off Date in an amount as set forth in the  
related Purchase Price and Terms Agreement, or in such other amount as agreed by
the Purchaser and the Seller as evidenced by the actual aggregate principal     
balance of the Mortgage Loans accepted by the Purchaser on each Closing Date.   

SECTION 3. Mortgage Schedules.                          

     The Seller from time to time shall provide the Purchaser with
certain information constituting a preliminary listing of the Mortgage Loans to 
be purchased on each Closing Date in accordance with the related Purchase Price 
and Terms Agreement and this Agreement (each, a "Preliminary Mortgage           
Schedule").                                                                     

            The Seller is obligated to deliver those Mortgage Loans owned by the
Seller and funded by the Originator pursuant to the original terms of the       
Originator's commitment to the mortgagor. The Seller shall deliver the related  
Mortgage Loan Schedule for the Mortgage Loans to be purchased on a particular   
Closing Date to the Purchaser at least two (2) Business Days prior to the       
related Closing Date. The related Mortgage Loan Schedule shall be the related   
Preliminary Mortgage Schedule with those Mortgage Loans which have not been     
funded prior to the related Closing Date deleted.                               

SECTION 4. Purchase Price.                              

            The Purchase Price for each Mortgage Loan shall be the percentage of
par as stated in the related Purchase Price and Terms Agreement (subject to     
adjustment as provided therein), multiplied by the aggregate principal balance, 
as of the related Cut-off Date, of the Mortgage Loans listed on the related     
Mortgage Loan Schedule, after application of scheduled payments of principal due
on or before the related Cut-off Date, but only to the extent such payments were
actually received. The initial principal amount of the related Mortgage Loans   
shall be the aggregate principal balance of the Mortgage Loans, so computed as  
of the related Cut-off Date. If so provided in the related Purchase Price and   
Terms Agreement, portions of the Mortgage Loans shall be priced separately.     

           In addition to the Purchase Price as described above, the Purchaser
shall pay to the Seller, at closing, accrued interest on the current principal  
amount of the related Mortgage Loans as of the related Cut-off Date at the      
weighted average Mortgage Interest Rate of those Mortgage Loans. The Purchase   
Price plus accrued interest as set forth in the preceding paragraph shall be    
paid to the Seller by wire transfer of immediately available funds to an account
designated by the Seller in writing.                                            

          The Purchaser shall be entitled to (l) all scheduled principal due
after the related Cut-off Date, (2) all other recoveries of principal collected 
on or after the related Cut-off Date, and (3) all payments of interest on the   
Mortgage Loans net of applicable Servicing Fees (minus that portion of any such 
payment which is allocable to the period prior to the related Cut-off Date). The
outstanding principal balance of each Mortgage Loan as of the related Cut-off   
Date is determined after application of payments of principal due on or before  
the related Cut-off Date, to the extent actually collected, together with any   
unscheduled principal prepayments collected prior to such Cut-off Date;         
provided, however, that payments of scheduled principal and interest paid prior 
to such Cut-off Date, but to be applied on a Due Date beyond the related Cut-off
Date shall not be applied to the principal balance as of the related Cut-off    
Date. Such prepaid amounts shall be the property of the Purchaser. The Seller   
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
Seller to the Purchaser.                                                        

SECTION 5. Examination of Mortgage Files.               

           At least three (3) Business Days prior to the related Closing Date,
the Seller shall (a) deliver to the Purchaser or its designee in escrow, for    
examination with respect to each Mortgage Loan to be purchased, the related     
Mortgage File, including a copy of the Assignment of Mortgage, pertaining to    
each Mortgage Loan, or (b) make the related Mortgage File available to the      
Purchaser for examination at such other location as shall otherwise be          
acceptable to the Purchaser. Such examination may be made by the Purchaser or   
its designee at any reasonable time before or after the related Closing Date. If
the Purchaser makes such examination prior to the related Closing Date and      
determines, in its sole discretion, that any Mortgage Loans are unacceptable to 
the Purchaser for any reason, such Mortgage Loans shall be deleted from the     
related Mortgage Loan Schedule, and may be replaced by a Qualified Substitute   
Mortgage Loan (or Loans) acceptable to the Purchaser. The Purchaser may, at its 
option and without notice to the Seller, purchase some or all of the Mortgage   
Loans without conducting any partial or complete examination. The fact that the 
Purchaser or its designee 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 herein.                                                      

SECTION 6. Conveyance from Seller to Purchaser.         

   Subsection 6.01 Conveyance of Mortgage Loans; Possession of
Servicing Files.                                                                

         The Seller, simultaneously with the delivery of the Mortgage Loan
Schedule with respect to the related Mortgage Loan Package to be purchased on   
each Closing Date, shall execute and deliver an Assignment and Conveyance       
Agreement in the form attached hereto as Exhibit H (the "Assignment and         
Conveyance Agreement"). The Seller shall cause the Servicing File retained by   
the Originator pursuant to this Agreement to be appropriately identified in the 
Seller's computer system and/or books and records, as appropriate, to clearly   
reflect the sale of the related Mortgage Loan to the Purchaser. The Seller shall
cause the Originator to release from its custody the contents of any Servicing  
File retained by it only in accordance with this Agreement or the Servicing     
Agreement, except when such release is required in connection with a repurchase 
of any such Mortgage Loan pursuant to Subsection 9.03.                          

Subsection 6.02 Books and Records.                      

          Record title to each Mortgage as of the related Closing Date shall
be in the name of the Seller, an Affiliate of the Seller, the Purchaser or one  
or more designees of the Purchaser, as the Purchaser shall select.              
Notwithstanding the foregoing, each Mortgage and related Mortgage Note shall be 
possessed solely by the Purchaser or the appropriate designee of the Purchaser, 
as the case may be. All rights arising out of the Mortgage Loans including, but 
not limited to, all funds received by the Seller or the Originator after the    
related Cut-off Date on or in connection with a Mortgage Loan shall be vested in
the Purchaser or one or more designees of the Purchaser; provided, however, that
all funds received on or in connection with a Mortgage Loan shall be received   
and held by the Seller or the Originator in trust for the benefit of the        
Purchaser or the appropriate designee of the Purchaser, as the case may be, as  
the owner of the Mortgage Loans pursuant to the terms of this Agreement.        

         The sale of each Mortgage Loan shall be reflected on the Seller's
balance sheet and other financial statements as a sale of assets by the Seller. 

            The Seller shall or shall cause the Originator to 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 Seller shall or shall cause  
the Originator to maintain in its possession, available for inspection by the   
Purchaser, and shall deliver to the Purchaser upon demand, evidence of          
compliance with all federal, state and local laws, rules and regulations, and   
requirements of Fannie Mae or Freddie Mac, including but not limited to         
documentation as to the method used in determining the applicability of the     
provisions of the National Flood Insurance Act of 1968, as amended, to the      
Mortgaged Property, documentation evidencing insurance coverage and periodic    
inspection reports, as required by the Fannie Mae Guides. To the extent that    
original documents are not required for purposes of realization of Liquidation  
Proceeds or Insurance Proceeds, documents maintained by the Seller or Originator
may be in the form of microfilm or microfiche so long as the Seller or          
Originator complies with the requirements of the Fannie Mae Guides.             

Subsection 6.03 Delivery of Mortgage Loan Documents.    

           The Seller shall deliver and release to the Custodian no later than
three (3) Business Days prior to the related Closing Date those Mortgage Loan   
Documents set forth on Exhibit A hereto as required by the Custodial Agreement  
with respect to each Mortgage Loan set forth on the related Mortgage Loan       
Schedule.                                                                       

         The Custodian shall certify its receipt of all such Mortgage Loan
Documents required to be delivered pursuant to the Custodial Agreement for the  
related Closing Date, as evidenced by the Initial Certification of the Custodian
in the form annexed to the Custodial Agreement. The Seller shall comply with the
terms of the Custodial Agreement and the Purchaser shall pay all fees and       
expenses of the Custodian.                                                      

        The Seller shall or shall cause the Originator to forward to the
Custodian, or to such other Person as the Purchaser shall designate in writing, 
original documents evidencing an assumption, modification, consolidation or     
extension of any Mortgage Loan entered into in accordance with this Agreement   
within two weeks of their execution, provided, however, that the Seller shall   
provide the Custodian, or to such other Person as the Purchaser shall designate 
in writing, with a certified true copy of any such document submitted for       
recordation within two weeks of its execution, and shall promptly 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 ninety days of its submission for recordation.      

           In the event any document required to be delivered to the Custodian
in the Custodial Agreement, including an original or copy of any document       
submitted for recordation to the appropriate public recording office, is not so 
delivered to the Custodian, or to such other Person as the Purchaser shall      
designate in writing, within 90 days following the related Closing Date (other  
than with respect to the Assignments of Mortgage which shall be delivered to the
Custodian in blank and recorded subsequently by the Purchaser or its designee), 
and in the event that the Seller does not cure such failure within 30 days of   
discovery or receipt of written notification of such failure from the Purchaser,
the related Mortgage Loan shall, upon the request of the Purchaser, be          
repurchased by the Seller at the price and in the manner specified in Subsection
9.03. The foregoing repurchase obligation shall not apply in the event that the 
Seller cannot deliver an original document submitted for recordation to the     
appropriate public recording office within the specified period due to a delay  
caused by the recording office in the applicable jurisdiction; provided that the
Seller shall instead deliver a recording receipt of such recording office or, if
such recording receipt is not available, an officer's certificate of a servicing
officer of the Seller, confirming that such documents have been accepted for    
recording; provided that, upon request of the Purchaser and delivery by the     
Purchaser to the Seller of a schedule of the related Mortgage Loans, the Seller 
shall reissue and deliver to the Purchaser or its designee said officer's       
certificate.                                                                    

        The Seller shall pay all initial recording fees, if any, for the
assignments of mortgage and any other fees or costs in transferring all original
documents to the Custodian or, upon written request of the Purchaser, to the    
Purchaser or the Purchaser's designee. The Purchaser or the Purchaser's designee
shall be responsible for recording the Assignments of Mortgage and shall be     
reimbursed by the Seller for the costs associated therewith pursuant to the     
preceding sentence.                                                             

Subsection 6.04 Quality Control Procedures.             

            The Seller shall, or shall cause the Originator to, have an internal
quality control program that verifies, on a regular basis, the existence and    
accuracy of the legal documents, credit documents, property appraisals, and     
underwriting decisions. The program shall include evaluating and monitoring the 
overall quality of the Originator's loan production and the servicing activities
of the Originator. The program is to ensure that the Mortgage Loans are         
originated and serviced in accordance with Accepted Servicing Standards and the 
Underwriting Guidelines; guard against dishonest, fraudulent, or negligent acts;
and guard against errors and omissions by officers, employees, or other         
authorized persons.                                                             

SECTION 7. Servicing of the Mortgage Loans.             

           The Mortgage Loans have been sold by the Seller to the Purchaser on
a servicing released basis. Subject to, and upon the terms and conditions of    
this Agreement and the Servicing Agreement (with respect to each Mortgage Loan, 
for an interim period, as specified therein), the Seller hereby sells,          
transfers, assigns, conveys and delivers to the Purchaser the Servicing Rights. 
The Purchaser shall retain the Originator as independent contract servicer of   
the Mortgage Loans pursuant to and in accordance with the terms and conditions  
contained in the Servicing Agreement. Pursuant to the Servicing Agreement, the  
Originator shall begin servicing the Mortgage Loans on behalf of the Purchaser  
and shall be entitled to the Servicing Fee and any Ancillary Income with respect
to such Mortgage Loans from the related Closing Date until the termination of   
the Servicing Agreement with respect to any of the Mortgage Loans as set forth  
in the Servicing Agreement. The Seller shall cause the Originator to service the
Mortgage Loans in accordance with the terms of the Servicing Agreement.         

SECTION 8. Transfer of Servicing.                       

        On the applicable Transfer Date, the Purchaser, or its designee,
shall assume all servicing responsibilities related to, and the Seller shall    
cause the Originator to cease all servicing responsibilities related to the     
related Mortgage Loans subject to such Transfer Date. The Transfer Date shall be
the date determined in accordance with Section 6.03 of the Servicing Agreement  
(with respect to each Mortgage Loan, for an interim period, as specified        
therein).                                                                       

           On or prior to the applicable Transfer Date, the Seller shall cause
the Originator shall, at its sole cost and expense, take such steps as may be   
necessary or appropriate to effectuate and evidence the transfer of the         
servicing of the related Mortgage Loans to the Purchaser, or its designee,      
including but not limited to the following:                                     

          (a) Notice to Mortgagors. The Seller shall cause the Originator to
mail to the Mortgagor of each related Mortgage Loan a letter advising such      
Mortgagor of the transfer of the servicing of the related Mortgage Loan to the  
Purchaser, or its designee, in accordance with the Cranston Gonzales National   
Affordable Housing Act of 1990; provided, however, the content and format of the
letter shall have the prior approval of the Purchaser. The Seller shall cause   
the Originator to provide the Purchaser with copies of all such related notices 
no later than the Transfer Date.                                                

            (b) Notice to Taxing Authorities and Insurance Companies. The Seller
shall cause the Originator to transmit to the applicable taxing authorities and 
insurance companies (including primary mortgage insurance policy insurers, if   
applicable) and/or agents, notification of the transfer of the servicing to the 
Purchaser, or its designee, and instructions to deliver all notices, tax bills  
and insurance statements, as the case may be, to the Purchaser from and after   
the related Transfer Date. The Seller shall cause the Originator to provide the 
Purchaser with copies of all such notices no later than such Transfer Date.     

     (c) Delivery of Servicing Records. The Seller shall cause the
Originator to forward to the Purchaser, or its designee, all servicing records  
and the Servicing File in the Originator's possession relating to each related  
Mortgage Loan including the information enumerated in the Servicing Agreement   
(with respect to each such Mortgage Loan, for an interim period, as specified   
therein).                                                                       

     (d) Escrow Payments. The Seller shall cause the Originator to
provide the Purchaser, or its designee, with immediately available funds by wire
transfer in the amount of the net Escrow Payments and suspense balances and all 
loss draft balances associated with the related Mortgage Loans. The Seller shall
cause the Originator to provide the Purchaser with an accounting statement of   
Escrow Payments and suspense balances and loss draft balances sufficient to     
enable the Purchaser to reconcile the amount of such payment with the accounts  
of the Mortgage Loans. Additionally, the Seller shall cause the Originator to   
wire transfer to the Purchaser the amount of any agency, trustee or prepaid     
Mortgage Loan payments and all other similar amounts held by the Originator.    

          (e) Payoffs and Assumptions. The Seller shall cause the Originator
to provide to the Purchaser, or its designee, copies of all assumption and      
payoff statements generated by the Originator on the related Mortgage Loans from
the related Cut-off Date to the Transfer Date.                                  

           (f) Mortgage Payments Received Prior to Transfer Date. Prior to the
Transfer Date all payments received by the Originator on each related Mortgage  
Loan shall be properly applied by the Originator to the account of the          
particular Mortgagor.                                                           

            (g) Mortgage Payments Received After Transfer Date. The Seller shall
cause the amount of any related Monthly Payments received by the Originator     
after the Transfer Date to be forwarded to the Purchaser by overnight mail on   
the date of receipt. The Seller shall cause the Originator to notify the        
Purchaser of the particulars of the payment, which notification requirement     
shall be satisfied if the Originator forwards with its payment sufficient       
information to permit appropriate processing of the payment by the Purchaser.   
The Seller shall cause the Originator to assume full responsibility for the     
necessary and appropriate legal application of such Monthly Payments received by
the Originator after the Transfer Date with respect to related Mortgage Loans   
then in foreclosure or bankruptcy; provided, for purposes of this Agreement,    
necessary and appropriate legal application of such Monthly Payments shall      
include, but not be limited to, endorsement of a Monthly Payment to the         
Purchaser with the particulars of the payment such as the account number, dollar
amount, date received and any special Mortgagor application instructions and the
Seller shall comply with the foregoing requirements with respect to all Monthly 
Payments received by the it after the Transfer Date.                            

          (h) Misapplied Payments. Misapplied payments shall be processed as
follows:                                                                        

                (1) All parties shall cooperate in correcting misapplication
errors;                                                 

          (2) The party receiving notice of a misapplied payment
            occurring prior to the applicable Transfer Date and discovered after
    such Transfer Date shall immediately notify the other party;

           (3) If a misapplied payment which occurred prior to the
          Transfer Date cannot be identified and said misapplied payment has
            resulted in a shortage in a Custodial Account or Escrow Account, the
          Seller shall or the Seller shall cause the Originator to be liable
       for the amount of such shortage. The Seller shall or the Seller
            shall cause the Originator to reimburse the Purchaser for the amount
         of such shortage within thirty (30) days after receipt of written
demand therefor from the Purchaser;                     

           (4) If a misapplied payment which occurred prior to the
          Transfer Date has created an improper Purchase Price as the result
        of an inaccurate outstanding principal balance, a check shall be
       issued to the party shorted by the improper payment application
       within five (5) Business Days after notice thereof by the other
party; and                                              

                  (5) Any check issued under the provisions of this Section 8(h)
        shall be accompanied by a statement indicating the corresponding
           Seller and/or the Purchaser Mortgage Loan identification number and
an explanation of the allocation of any such payments.  

           (i) Books and Records. On the Transfer Date, the books, records and
accounts of the Originator with respect to the related Mortgage Loans shall be  
in accordance with all applicable Purchaser requirements.                       

          (j) Reconciliation. The Seller shall or shall cause the Originator
to, on or before the Transfer Date, reconcile principal balances and make any   
monetary adjustments required by the Purchaser. Any such monetary adjustments   
will be transferred between the Seller, the Originator and the Purchaser as     
appropriate.                                                                    

        (k) IRS Forms. The Seller shall or shall cause the Originator to
file all IRS forms 1099, 1099A, 1098 or 1041 and K-1 which are required to be   
filed on or before the Transfer Date in relation to the servicing and ownership 
of the related Mortgage Loans. The Seller or Originator shall provide copies of 
such forms to the Purchaser upon request and shall reimburse the Purchaser for  
any costs or penalties incurred by the Purchaser due to the Seller's or         
Originator's failure to comply with this paragraph.                             

           SECTION 9. Representations, Warranties and Covenants of the Seller;
Remedies for Breach.                                                            

            Subsection 9.01 Representations and Warranties Regarding the Seller.

           The Seller represents, warrants and covenants to the Purchaser that
as of the date hereof and as of each Closing Date:                              

            (a) Due Organization and Authority. The Seller is a corporation duly
organized, validly existing and in good standing under the laws of the state of 
California and has all licenses necessary to carry on its business as now being 
conducted and is licensed, qualified and in good standing in each state wherein 
it owns or leases any material properties or 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 Seller, and in any event the   
Seller 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 and the       
Servicing Agreement; the Seller 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 thereunder; 
the execution, delivery and performance of this Agreement (including all        
instruments of transfer to be delivered pursuant to this Agreement) by the      
Seller and the consummation of the transactions contemplated hereby and thereby 
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 Seller, 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 Seller to make this Agreement  
and all agreements contemplated hereby valid and binding upon the Seller in     
accordance with their terms;                                                    

(b) Ordinary Course of Business. The consummation of the
transactions contemplated by this Agreement are in the ordinary course of       
business of the Seller, and the transfer, assignment and conveyance of the      
Mortgage Notes and the Mortgages by the Seller 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 or origination of the Mortgage Loans by the Seller,  
the sale of the Mortgage Loans to the Purchaser, the consummation of the        
transactions contemplated hereby and thereby, 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, conditions or provisions of the      
Seller's charter or by-laws or any legal restriction or any agreement or        
instrument to which the Seller is now a party or by which it is bound, or       
constitute a default or result in an acceleration under any of the foregoing, or
result in the violation of any law, rule, regulation, order, judgment or decree 
to which the Seller or its property is subject, or result in the creation or    
imposition of any lien, charge or encumbrance that would have an adverse effect 
upon any of its properties pursuant to the terms of any mortgage, contract, deed
of trust or other instrument, or impair the ability of the Purchaser to realize 
on the Mortgage Loans, impair the value of the Mortgage Loans, or impair the    
ability of the Purchaser to realize the full amount of any insurance benefits   
accruing pursuant to this Agreement;                                            

          (d) Ability to Service. Originator has the facilities, procedures,
and experienced personnel necessary for the sound servicing of mortgage loans of
the same type as the Mortgage Loans. The Originator is duly qualified, licensed,
registered and otherwise authorized under all applicable federal, state and     
local laws, and regulations, if applicable, meets the minimum capital           
requirements set forth by HUD, the OTS, the OCC or the FDIC, if applicable, and 
is in good standing to enforce, originate, sell mortgage loans to, and service  
mortgage loans in each jurisdiction wherein the Mortgaged Properties are        
located;                                                                        

            (e) Reasonable Servicing Fee. The Originator 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 Originator,  
for accounting and tax purposes, as compensation for the servicing and          
administration of the Mortgage Loans pursuant to this Agreement and the         
Servicing Agreement;                                                            

          (f) Ability to Perform; Solvency. The Seller 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 Seller is solvent and the sale  
of the Mortgage Loans will not cause the Seller to become insolvent. The sale of
the Mortgage Loans is not undertaken with the intent to hinder, delay or defraud
any of Seller's creditors;                                                      

          (g) No Litigation Pending. There is no action, suit, proceeding or
investigation pending or threatened against the Seller, before any court,       
administrative agency or other tribunal asserting the invalidity of this        
Agreement, seeking to prevent the consummation of any of the transactions       
contemplated by this Agreement or 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 Seller, or in any  
material impairment of the right or ability of the Seller to carry on its       
business substantially as now conducted, or in any material liability on the    
part of the Seller, or which would draw into question the validity of this      
Agreement or the Mortgage Loans or of any action taken or to be taken in        
connection with the obligations of the Seller contemplated herein, or which     
would be likely to impair materially the ability of the Seller to perform under 
the terms of this Agreement;                                                    

       (h) No Consent Required. No consent, approval, authorization or
order of, or registration or filing with, or notice to any court or governmental
agency or body including HUD, the FHA or the Department of Veterans Affairs is  
required for the execution, delivery and performance by the Seller of or        
compliance by the Seller with this Agreement or the Mortgage Loans, the delivery
of a portion of the Mortgage Files to the Custodian or the sale of the Mortgage 
Loans or the consummation of the transactions contemplated by this Agreement, or
if required, such approval has been obtained prior to the related Closing Date; 

          (i) Selection Process. The Mortgage Loans were selected from among
the outstanding one- to four-family mortgage loans in the Seller's portfolio at 
the related Closing Date as to which the representations and warranties set     
forth in Subsection 9.02 could be made and such selection was not made in a     
manner so as to affect adversely the interests of the Purchaser;                

           (j) Delivery to the Custodian. The Mortgage Note, the Mortgage, the
Assignment of Mortgage and any other documents required to be delivered with    
respect to each Mortgage Loan pursuant to the Custodial Agreement, shall be     
delivered to the Custodian all in compliance with the specific requirements of  
the Custodial Agreement. With respect to each Mortgage Loan, the Seller will be 
in possession of a complete Mortgage File in compliance with Exhibit A hereto,  
except for such documents as will be delivered to the Custodian;                

     (k) Mortgage Loan Characteristics. The characteristics of the
related Mortgage Loan Package are as set forth on the description of the pool   
characteristics for the applicable Mortgage Loan Package delivered pursuant to  
Section 11 on the related Closing Date in the form attached as Exhibit B to each
related Assignment and Conveyance Agreement;                                    

 (l) No Untrue Information. Neither this Agreement nor any
information, statement, tape, diskette, report, form, or other document         
furnished or to be furnished pursuant to this Agreement or any Reconstitution   
Agreement or in connection with the transactions contemplated hereby (including 
any Securitization Transaction or Whole Loan Transfer) contains or will contain 
any untrue statement of fact or omits or will omit to state a fact necessary to 
make the statements contained herein or therein not misleading;                 

           (m) Financial Statements. The Seller has delivered to the Purchaser
financial statements as to its last three complete fiscal years and any later   
quarter ended more than 60 days prior to the execution of this Agreement. All   
such financial statements fairly present the pertinent results of operations and
changes in financial position for each of such periods and the financial        
position at the end of each such period of the Seller and its subsidiaries and  
have been prepared in accordance with generally accepted accounting principles  
consistently applied throughout the periods involved, except as set forth in the
notes thereto. In addition, the Seller has delivered information as to its loan 
gain and loss experience in respect of foreclosures and its loan delinquency    
experience for the immediately preceding three-year period, in each case with   
respect to mortgage loans owned by it and such mortgage loans serviced for      
others during such period, and all such information so delivered shall be true  
and correct in all material respects. There has been no change in the business, 
operations, financial condition, properties or assets of the Seller since the   
date of the Seller's financial statements that would have a material adverse    
effect on its ability to perform its obligations under this Agreement. The      
Seller has completed any forms requested by the Purchaser in a timely manner and
in accordance with the provided instructions;                                   

            (n) No Brokers. The Seller has not dealt with any broker, investment
banker, agent or other person that may be entitled to any commission or         
compensation in connection with the sale of the Mortgage Loans;                 

         (o) Sale Treatment. The Seller intends to reflect the transfer of
the Mortgage Loans as a sale on the books and records of the Seller and the     
Seller has determined that the disposition of the Mortgage Loans pursuant to    
this Agreement will be afforded sale treatment for tax and accounting purposes; 

      (p) Owner of Record. The Seller is the owner of record of each
Mortgage and the indebtedness evidenced by each Mortgage Note, except for the   
Assignments of Mortgage which have been sent for recording, and upon recordation
the Seller will be the owner of record of each Mortgage and the indebtedness    
evidenced by each Mortgage Note, and upon the sale of the Mortgage Loans to the 
Purchaser, the Seller will retain the Mortgage Files with respect thereto in    
trust only for the purpose of servicing and supervising the servicing of each   
Mortgage Loan;                                                                  

            (q) Origination. The Originator's decision to originate any mortgage
loan or to deny any mortgage loan application is an independent decision based  
upon Originator's Underwriting Guidelines, and is in no way made as a result of 
Purchaser's decision to purchase, or not to purchase, or the price Purchaser may
offer to pay for, any such mortgage loan, if originated;                        

      (r) Compliance with Anti-Money Laundering Laws. The Seller 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"); and                                              

       (s) Credit Reporting. The Seller shall cause the Originator, as
servicer, to fully 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 (three of the credit repositories), on a       
monthly basis. Additionally, the Seller shall cause the Originator, as servicer,
to transmit full-file credit reporting data for each Mortgage Loan pursuant to  
Fannie Mae Guide Announcement 95-19 and that for each Mortgage Loan, the Seller 
shall cause the Originator, as servicer, to report one of the following statuses
each month as follows: new origination, current, delinquent (30-, 60-, 90-days, 
etc.), foreclosed, or charged-off.                                              

           Subsection 9.02 Representations and Warranties Regarding Individual
Mortgage Loans.                                                                 

           The Seller hereby represents and warrants to the Purchaser that, as
to each Mortgage Loan, as of the related Closing Date for such Mortgage Loan:   

         (a) Mortgage Loans as Described. The information set forth in the
related Mortgage Loan Schedule is complete, true and correct;                   

        (b) Payments Current. All payments required to be made up to the
related Closing Date for the Mortgage Loan under the terms of the Mortgage Note,
other than payments not yet 30 days delinquent, have been made and credited. No 
payment required under the Mortgage Loan is 30 days or more delinquent nor has  
any payment under the Mortgage Loan been 30 days or more delinquent at any time 
since the origination of the Mortgage Loan. The first Monthly Payment shall be  
made with respect to the Mortgage Loan on its related Due Date or within the    
grace period, all in accordance with the terms of the related Mortgage Note;    

           (c) No Outstanding Charges. There are no defaults in complying with
the terms of the Mortgage, and all taxes, governmental assessments, insurance   
premiums, water, sewer and municipal charges, leasehold payments or ground rents
which previously became due and owing have been paid, or an escrow of funds has 
been established in an amount sufficient to pay for every such item which       
remains unpaid and which has been assessed but is not yet due and payable. The  
Seller has not advanced funds, or induced, solicited or knowingly received any  
advance of funds by a party other than the Mortgagor, directly or indirectly,   
for the payment of any amount required under the Mortgage Loan, except for      
interest accruing from the date of the Mortgage Note or date of disbursement of 
the Mortgage Loan proceeds, whichever is earlier, to the day which precedes by  
one month the related Due Date of the first installment of principal and        
interest;                                                                       

         (d) Original Terms Unmodified. The terms of the Mortgage Note and
Mortgage have not been impaired, waived, altered or modified in any respect,    
from the date of origination except by a written instrument which has been      
recorded, if necessary to protect the interests of the Purchaser, and which has 
been delivered to the Custodian or to such other Person as the Purchaser shall  
designate in writing, and the terms of which are reflected in the related       
Mortgage Loan Schedule. The substance of any such waiver, alteration or         
modification has been approved by the title insurer, if any, to the extent      
required by the policy, and its terms are reflected on the related Mortgage Loan
Schedule, if applicable. No Mortgagor has been released, in whole or in part,   
except in connection with an assumption agreement, approved by the issuer of the
title insurer, to the extent required by the policy, and which assumption       
agreement is part of the Mortgage Loan File delivered to the Custodian or to    
such other Person as the Purchaser shall designate in writing and the terms of  
which are reflected in the related Mortgage Loan Schedule;                      

         (e) 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 and no such    
right of rescission, set-off, counterclaim or defense has been asserted with    
respect thereto, and no Mortgagor was a debtor in any state or Federal          
bankruptcy or insolvency proceeding at the time the Mortgage Loan was           
originated;                                                                     

        (f) Hazard Insurance. Pursuant to the terms of the Mortgage, all
buildings or other improvements upon the Mortgaged Property are insured by a    
generally acceptable insurer against loss by fire, hazards of extended coverage 
and such other hazards as are provided for in the Fannie Mae Guides or by       
Freddie Mac, as well as all additional requirements set forth in Section 2.10 of
the Servicing Agreement. If required by the National Flood Insurance Act of     
1968, as amended, each Mortgage Loan is covered by a flood insurance policy     
meeting the requirements of the current guidelines of the Federal Insurance     
Administration is in effect which policy conforms to Fannie Mae and Freddie Mac,
as well as all additional requirements set forth in Section 2.10 of the         
Servicing Agreement. All individual insurance policies contain a standard       
mortgagee clause naming the Seller and its successors and assigns as mortgagee, 
and all premiums thereon have been paid. The Mortgage obligates the Mortgagor   
thereunder to maintain the hazard insurance policy at the Mortgagor's cost and  
expense, and on the Mortgagor's failure to do so, authorizes the holder of the  
Mortgage to obtain and maintain such insurance at such Mortgagor's cost and     
expense, and to seek reimbursement therefor from the Mortgagor. Where required  
by state law or regulation, the Mortgagor has been given an opportunity to      
choose the carrier of the required hazard insurance, provided the policy is not 
a "master" or "blanket" hazard insurance policy covering a condominium, or any  
hazard insurance policy covering the common facilities of a planned unit        
development. The hazard insurance policy is the valid and binding obligation of 
the insurer, is in full force and effect, and will be in full force and effect  
and inure to the benefit of the Purchaser upon the consummation of the          
transactions contemplated by this Agreement. The Seller has not engaged in, and 
has no knowledge of the Mortgagor's having engaged in, any act or omission which
would impair the coverage of any such policy, the benefits of the endorsement   
provided for herein, or the validity and binding effect of either including,    
without limitation, 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 Seller;                   

            (g) 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, disclosure and all predatory and abusive lending laws 
applicable to the Mortgage Loan, including, without limitation, any provisions  
relating to the Illinois Interest Act and prepayment penalties, have been       
complied with, the consummation of the transactions contemplated hereby will not
involve the violation of any such laws or regulations, and the Seller 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;                                                                   

  (h) 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     
release, cancellation, subordination or rescission. The Seller has not waived   
the performance by the Mortgagor of any action, if the Mortgagor's failure to   
perform such action would cause the Mortgage Loan to be in default, nor has the 
Seller waived any default resulting from any action or inaction by the          
Mortgagor;                                                                      

           (i) Location and Type of Mortgaged Property. The Mortgaged Property
is located in the state identified in the Mortgage Loan Schedule and consists 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 low-rise        
condominium project, or an individual unit in a planned unit development or a de
minimis planned unit development which is in each case four stories or less,    
provided, however, that any mobile home (double wide only) or manufactured      
dwelling shall conform with the applicable Fannie Mae and Freddie Mac           
requirements regarding such dwellings and that no Mortgage Loan is secured by a 
single parcel of real property with a cooperative housing corporation, a log    
home or, except as described in Exhibit B to the related Assignment and         
Conveyance Agreement, a mobile home erected thereon or by a mixed-use property, 
a property in excess of 10 acres, or other unique property types. As of the date
of origination, no portion of the Mortgaged Property was used for commercial    
purposes, and since the date of origination, no portion of the Mortgaged        
Property has been used for commercial purposes; provided, that Mortgaged        
Properties which contain a home office shall not be considered as being used for
commercial purposes as long as the Mortgaged Property has not been altered for  
commercial purposes and is not storing any chemicals or raw materials other than
those commonly used for homeowner repair, maintenance and/or household purposes.
In the case of a Manufactured Home, (i) the related manufactured dwelling and   
the related land are subject to a Mortgage properly filed in the appropriate    
public recording office and naming Seller as mortgagee, (ii) the applicable laws
of the jurisdiction in which the related Mortgaged Property is located will deem
the manufactured dwelling located on such Mortgaged Property to be a part of the
real property on which such dwelling is located, and (iii) such Manufactured    
Home Mortgage Loan is (x) a qualified mortgage under Section 860G(a)(3) of the  
Internal Revenue Code of 1986, as amended and (y) secured by manufactured       
housing treated as a single family residence under Section 25(e)(10) of the     
Code;                                                                           

            (j) Valid First or Second Lien. The Mortgage is a valid, subsisting,
enforceable and perfected, first lien (with respect to a First Lien Loan) or a  
second lien (with respect to a Second Lien Loan) on the Mortgaged Property,     
including all buildings and improvements 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) with respect to a Second Lien Loan only, the lien of the
first mortgage on the Mortgaged Property;               

               (2) the lien of current real property taxes and assessments
not yet due and payable;                                

              (3) covenants, conditions and restrictions, rights of way,
          easements and other matters of the public record as of the date of
     recording acceptable to prudent mortgage lending institutions
    generally and specifically referred to in the lender's title
         insurance policy delivered to the originator of the Mortgage Loan
       and (A) specifically referred to or otherwise considered in the
           appraisal made for the originator of the Mortgage Loan or (B) which
    do not adversely affect the Appraised Value of the Mortgaged
Property set forth in such appraisal; and               

           (4) 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, enforceable and perfected first lien (with respect to a First Lien  
Loan) or second lien (with respect to a Second Lien Loan) and first priority    
(with respect to a First Lien Loan) or second priority (with respect to a Second
Lien Loan) security interest on the property described therein and the Seller   
has full right to sell and assign the same to the Purchaser.;                   

     (k) Validity of Mortgage Documents. The Mortgage Note and the
Mortgage and any other agreement executed and delivered by a Mortgagor in       
connection with a Mortgage Loan are genuine, and each is the legal, valid and   
binding obligation of the maker thereof enforceable in accordance with its terms
(including, without limitation, any provisions therein relating to prepayment   
penalties). All parties to the Mortgage Note, the Mortgage and any other such   
related agreement had legal capacity to enter into the Mortgage Loan and to     
execute and deliver the Mortgage Note, the Mortgage and any such agreement, and 
the Mortgage Note, the Mortgage and any other such related agreement have been  
duly and properly executed by other such related parties. No fraud, error,      
omission, misrepresentation, negligence or similar occurrence with respect to a 
Mortgage Loan has taken place on the part of any Person, including without      
limitation, the Mortgagor, any appraiser, any builder or developer, or any other
party involved in the origination of the Mortgage Loan. The Seller has reviewed 
all of the documents constituting the Servicing File and has made such inquiries
as it deems necessary to make and confirm the accuracy of the representations   
set forth herein;                                                               

            (l) Full Disbursement of Proceeds. The Mortgage Loan has been closed
and the proceeds of the Mortgage Loan have been fully disbursed and there is no 
requirement for future advances thereunder, and any and all requirements as to  
completion of any on-site or off-site improvement and as to disbursements of any
escrow funds therefor have been complied with. 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;                        

           (m) Ownership. The Seller is the sole owner of record and holder of
the Mortgage Loan and the indebtedness evidenced by each Mortgage Note and upon 
the sale of the Mortgage Loans to the Purchaser, the Seller will retain the     
Mortgage Files or any part thereof with respect thereto not delivered to the    
Custodian, the Purchaser or the Purchaser's designee, in trust only for the     
purpose of servicing and supervising the servicing of each Mortgage Loan. The   
Mortgage Loan is not assigned or pledged, and the Seller has good, indefeasible 
and marketable title thereto, and has full right to transfer and sell the       
Mortgage Loan to the Purchaser free and clear of any encumbrance, equity,       
participation interest, lien, pledge, charge, claim or security interest, and   
has full right and authority subject to no interest or participation of, or     
agreement with, any other party, to sell and assign each Mortgage Loan pursuant 
to this Agreement and following the sale of each Mortgage Loan, the Purchaser   
will own such Mortgage Loan free and clear of any encumbrance, equity,          
participation interest, lien, pledge, charge, claim or security interest. The   
Seller intends to relinquish all rights to possess, control and monitor the     
Mortgage Loan. After the related Closing Date, the Seller will have no right to 
modify or alter the terms of the sale of the Mortgage Loan and the Seller will  
have no obligation or right to repurchase the Mortgage Loan or substitute       
another Mortgage Loan, except as provided in this Agreement;                    

          (n) Doing Business. 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 (2) either (i) organized   
under the laws of such state, or (ii) qualified to do business in such state, or
(iii) a federal savings and loan association, a savings bank or a national bank 
having a principal office in such state, or (3) not doing business in such      
state;                                                                          

(o) LTV. No Mortgage Loan has an LTV greater than 100%; 

    (p) Title Insurance. The Mortgage Loan is covered by an ALTA
lender's title insurance policy, or with respect to any Mortgage Loan for which 
the related Mortgaged Property is located in California a CLTA lender's title   
insurance policy, or other generally acceptable form of policy or insurance     
acceptable to Fannie Mae or Freddie Mac and each such title insurance policy is 
issued by a title insurer acceptable to Fannie Mae or Freddie Mac and qualified 
to do business in the jurisdiction where the Mortgaged Property is located,     
insuring the Seller, its successors and assigns, as to the first (with respect  
to a First Lien Loan) or second (with respect to a Second Lien Loan) priority   
lien of the Mortgage in the original principal amount of the Mortgage Loan (or  
to the extent a Mortgage Note provides for negative amortization, the maximum   
amount of negative amortization in accordance with the Mortgage), subject only  
to the exceptions contained in clauses (1), (2) and (3) of Paragraph (j) of this
Subsection 9.02, and in the case of Adjustable Rate Mortgage Loans, against any 
loss by reason of the invalidity or unenforceability of the lien resulting from 
the provisions of the Mortgage providing for adjustment to the Mortgage Interest
Rate and Monthly Payment. Where required by state law or regulation, the        
Mortgagor has been given the opportunity to choose the carrier of the required  
mortgage title insurance. Additionally, such lender's title insurance policy    
affirmatively insures ingress and egress, and against encroachments by or upon  
the Mortgaged Property or any interest therein. The Seller, its successor and   
assigns, are the sole insureds of such lender's title insurance policy, and such
lender's title insurance policy is valid and remains 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 related Mortgage, including  
the Seller, has done, by act or omission, anything which would impair the       
coverage of such lender's title insurance policy, including without limitation, 
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 Seller;                                             

            (q) No Defaults. Other than payments due but not yet 30 days or more
delinquent, there is no default, breach, violation or event which would permit  
acceleration existing under the Mortgage or the Mortgage Note and no event      
which, 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 which    
would permit acceleration, and neither the Seller nor any of its affiliates nor 
any of their respective predecessors, have waived any default, breach, violation
or event which would permit acceleration;                                       

            (r) 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;                              

        (s) Location of Improvements; No Encroachments. 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;            

        (t) Origination; Payment Terms. Either (a) 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, or (b) the following requirements have been met
with respect to the Mortgage Loan: the Seller meets the requirements set forth  
in clause (a), and (i) such Mortgage Loan was underwritten in accordance with   
standards established by the Seller, using application forms and related credit 
documents approved by the Seller, (ii) the Seller approved each application and 
the related credit documents before a commitment by the correspondent was       
issued, and no such commitment was issued until the Seller agreed to fund such  
Mortgage Loan, (iii) the closing documents for such Mortgage Loan were prepared 
on forms approved by the Seller, and (iv) such Mortgage Loan was actually funded
by the Seller and was purchased by the Seller at closing or soon thereafter. 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. Principal payments on the Mortgage Loan  
commenced no more than sixty days after funds were disbursed in connection with 
the Mortgage Loan. The Mortgage Interest Rate as well as, with respect to       
Adjustable Rate Mortgage loans, the Lifetime Rate Cap and the Periodic Cap, are 
as set forth on the related Mortgage Loan Schedule. The Mortgage Note is payable
in equal monthly installments of principal and interest, which installments of  
interest, with respect to Adjustable Rate Mortgage 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 years from commencement of amortization. Unless    
otherwise specified on the related Mortgage Loan Schedule, 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;                                                                           

     (u) 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. Upon default by a Mortgagor on a Mortgage Loan and        
foreclosure on, or trustee's sale of, the Mortgaged Property pursuant to the    
proper procedures, the holder of the Mortgage Loan will be able to deliver good 
and merchantable title to the Mortgaged Property. 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, subject to applicable federal and state laws and judicial precedent   
with respect to bankruptcy and right of redemption or similar law;              

    (v) Conformance with Agency and Underwriting Guidelines. The
Mortgage Loan was underwritten in accordance with the Underwriting Guidelines.  
The Mortgage Note and Mortgage are on forms acceptable to Freddie Mac or Fannie 
Mae and neither the Seller nor the Originator has made any representations to a 
Mortgagor that are inconsistent with the mortgage instruments used;             

          (w) Occupancy of the Mortgaged Property. As of the related Closing
Date the Mortgaged Property is lawfully occupied under applicable law. All      
inspections, licenses and certificates required to be made or issued with       
respect to all occupied portions of the Mortgaged Property and, with respect to 
the use and occupancy of the same, including but not limited to certificates of 
occupancy and fire underwriting certificates, have been made or obtained from   
the appropriate authorities;                                                    

          (x) No Additional Collateral. The Mortgage Note is not and has not
been secured by any collateral except the lien of the corresponding Mortgage and
the security interest of any applicable security agreement or chattel mortgage  
referred to in Paragraph (j) above;                                             

           (y) Deeds of Trust. In the event the Mortgage constitutes a deed of
trust, a trustee, authorized and 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 Purchaser to
the trustee under the deed of trust, except in connection with a trustee's sale 
after default by the Mortgagor;                                                 

           (z) Acceptable Investment. There are no circumstances or conditions
with respect to the Mortgage, the Mortgaged Property, the Mortgagor, the        
Mortgage File or the Mortgagor's credit standing that can reasonably be expected
to cause private institutional investors who invest in mortgage loans similar to
the Mortgage Loan to regard the Mortgage Loan as an unacceptable investment,    
cause the Mortgage Loan to become delinquent, or adversely affect the value or  
marketability of the Mortgage Loan, or cause the Mortgage Loans to prepay during
any period materially faster or slower than the mortgage loans originated by the
Seller generally;                                                               

   (aa) Delivery of Mortgage Documents. The Mortgage Note, the
Mortgage, the Assignment of Mortgage and any other documents required to be     
delivered under the Custodial Agreement for each Mortgage Loan have been        
delivered to the Custodian. The Seller is in possession of a complete, true and 
accurate Mortgage File in compliance with Exhibit A hereto, except for such     
documents the originals of which have been delivered to the Custodian;          

     (bb) Condominiums/Planned Unit Developments. If the Mortgaged
Property is a condominium unit or a planned unit development (other than a de   
minimis planned unit development) such condominium or planned unit development  
project such Mortgage Loan was originated in accordance with, and the Mortgaged 
Property meets the guidelines set forth in the Originator's Underwriting        
Guidelines;                                                                     

        (cc) Transfer of Mortgage Loans. The Assignment of Mortgage with
respect to each Mortgage Loan is in recordable form and is acceptable for       
recording under the laws of the jurisdiction in which the Mortgaged Property is 
located. The transfer, assignment and conveyance of the Mortgage Notes and the  
Mortgages by the Seller are not subject to the bulk transfer or similar         
statutory provisions in effect in any applicable jurisdiction;                  

            (dd) Due-On-Sale. With respect to each Fixed Rate Mortgage Loan, the
Mortgage contains an enforceable provision for the acceleration of the payment  
of the unpaid principal balance of the Mortgage Loan in the event that the      
Mortgaged Property is sold or transferred without the prior written consent of  
the mortgagee thereunder, and such provision is enforceable;                    

        (ee) Assumability. With respect to each Adjustable Rate Mortgage
Loan, the Mortgage Loan Documents provide that after the related first Interest 
Rate Adjustment Date, a related Mortgage Loan may only be assumed if the party  
assuming such Mortgage Loan meets certain credit requirements stated in the     
Mortgage Loan Documents;                                                        

       (ff) No Buydown Provisions; No Graduated Payments or Contingent
Interests. The Mortgage Loan does not contain provisions pursuant to which      
Monthly Payments are paid or partially paid with funds deposited in any separate
account established by the Seller, the Mortgagor, or anyone on behalf of the    
Mortgagor, or paid by any source other than the Mortgagor nor does it contain   
any other similar provisions which may constitute a "buydown" provision. The    
Mortgage Loan is not a graduated payment mortgage loan and the Mortgage Loan    
does not have a shared appreciation or other contingent interest feature;       

          (gg) Consolidation of Future Advances. Any future advances made to
the Mortgagor prior to the Cut-off Date have been consolidated with the         
outstanding principal amount secured by the Mortgage, and the secured principal 
amount, as consolidated, bears a single interest rate and single repayment term.
The lien of the Mortgage securing the consolidated principal amount is expressly
insured as having first (with respect to a First Lien Loan) or a second (with   
respect to a Second Lien Loan) lien priority by a title insurance policy, an    
endorsement to the policy insuring the mortgagee's consolidated interest or by  
other title evidence acceptable to Fannie Mae and Freddie Mac. The consolidated 
principal amount does not exceed the original principal amount of the Mortgage  
Loan;                                                                           

       (hh) Mortgaged Property Undamaged; No Condemnation Proceedings.
There is no proceeding pending or threatened for the total or partial           
condemnation of the Mortgaged Property. The Mortgaged Property is undamaged by  
waste, fire, earthquake or earth movement, windstorm, flood, 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  
and each Mortgaged Property is in good repair. There have not been any          
condemnation proceedings with respect to the Mortgaged Property and the Seller  
has no knowledge of any such proceedings in the future;                         

 (ii) Collection Practices; Escrow Deposits; Interest Rate
Adjustments. The origination, servicing and collection practices used by the    
Seller and the Originator with respect to the Mortgage Loan have been in all    
respects in compliance with Accepted Servicing Practices, applicable laws and   
regulations, and have been in all respects legal and proper. With respect to    
escrow deposits and Escrow Payments, all such payments are in the possession of,
or under the control of, the Seller or the Originator and there exist no        
deficiencies in connection therewith for which customary arrangements for       
repayment thereof have not been made. All Escrow Payments have been collected in
full compliance with state and federal law and the provisions of the related    
Mortgage Note and Mortgage. An escrow of funds is not prohibited by applicable  
law and has been established in an amount sufficient 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 Seller have    
been capitalized under the Mortgage or the Mortgage Note. All Mortgage Interest 
Rate adjustments have been made in strict compliance with state and federal law 
and the terms of the related Mortgage and Mortgage Note on the related Interest 
Rate Adjustment Date. If, pursuant to the terms of the Mortgage Note, another   
index was selected for determining the Mortgage Interest Rate, the same index   
was used with respect to each Mortgage Note which required a new index to be    
selected, and such selection did not conflict with the terms of the related     
Mortgage Note. The Seller or the Originator executed and delivered any and all  
notices required under applicable law and the terms of the related Mortgage Note
and Mortgage regarding the Mortgage Interest Rate and the Monthly Payment       
adjustments. Any interest required to be paid pursuant to state, federal and    
local law has been properly paid and credited;                                  

          (jj) Conversion to Fixed Interest Rate. With respect to Adjustable
Rate Mortgage Loans, the Mortgage Loan is not a Convertible Mortgage Loan;      

       (kk) Other Insurance Policies. No action, inaction or event has
occurred and no state of facts exists or has existed that has resulted or will  
result in the exclusion from, denial of, or defense to coverage under any       
applicable, special hazard insurance policy, or bankruptcy bond, irrespective of
the cause of such failure of coverage. In connection with the placement of any  
such insurance, no commission, fee, or other compensation has been or will be   
received by the Seller or by any officer, director, or employee of the Seller or
any designee of the Seller or any corporation in which the Seller or any        
officer, director, or employee had a financial interest at the time of placement
of such insurance;                                                              

           (ll) No Violation of Environmental Laws. There is no pending action
or proceeding directly involving the Mortgaged Property in which compliance with
any environmental law, rule or regulation is an issue; there is no violation of 
any environmental law, rule or regulation with respect to the Mortgage Property;
and nothing further remains to be done to satisfy in full all requirements of   
each such law, rule or regulation constituting a prerequisite to use and        
enjoyment of said property;                                                     

            (mm) Servicemembers Civil Relief Act. The Mortgagor has not notified
the Seller, and the Seller has no knowledge of any relief requested or allowed  
to the Mortgagor under the Servicemembers Relief Act or any similar state       
statute;                                                                        

      (nn) Appraisal. The Mortgage File contains an appraisal of the
related Mortgaged Property signed prior to the approval of the Mortgage Loan    
application by a Qualified Appraiser, duly appointed by the Seller or the       
Originator, 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      
appraiser both satisfy the requirements of Fannie Mae or Freddie Mac and Title  
XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989  
and the regulations promulgated thereunder, all as in effect on the date the    
Mortgage Loan was originated;                                                   

            (oo) Disclosure Materials. The Mortgagor has executed a statement to
the effect that the Mortgagor has received all disclosure materials required by,
and the Originator has complied with, all applicable law with respect to the    
making of the Mortgage Loans. The Seller shall cause the Originator to maintain 
such statement in the Mortgage File;                                            

     (pp) Construction or Rehabilitation of Mortgaged Property. No
Mortgage Loan was made in connection with the construction or rehabilitation of 
a Mortgaged Property or facilitating the trade-in or exchange of a Mortgaged    
Property;                                                                       

            (qq) Value of Mortgaged Property. The Seller has no knowledge of any
circumstances existing that could reasonably be expected to adversely affect the
value or the marketability of any Mortgaged Property or Mortgage Loan or to     
cause the Mortgage Loans to prepay during any period materially faster or slower
than similar mortgage loans held by the Seller generally secured by properties  
in the same geographic area as the related Mortgaged Property;                  

          (rr) No Defense to Insurance Coverage. No action has been taken or
failed to be taken, no event has occurred and no state of facts exists or has   
existed on or prior to the related Closing Date (whether or not known to the    
Seller on or prior to such date) which has resulted or will result in an        
exclusion from, denial of, or defense to coverage under any primary mortgage    
insurance (including, without limitation, any exclusions, denials or defenses   
which would limit or reduce the availability of the timely payment of the full  
amount of the loss otherwise due thereunder to the insured) whether arising out 
of actions, representations, errors, omissions, negligence, or fraud of the     
Seller, the related Mortgagor or any party involved in the application for such 
coverage, including the appraisal, plans and specifications and other exhibits  
or documents submitted therewith to the insurer under such insurance policy, or 
for any other reason under such coverage, but not including the failure of such 
insurer to pay by reason of such insurer's breach of such insurance policy or   
such insurer's financial inability to pay;                                      

          (ss) Escrow Analysis. With respect to each Mortgage, the Seller or
the Originator has within the last twelve months (unless such Mortgage was      
originated within such twelve month period) analyzed the required Escrow        
Payments for each Mortgage and adjusted the amount of such payments so that,    
assuming all required payments are timely made, any deficiency will be          
eliminated on or before the first anniversary of such analysis, or any overage  
will be refunded to the Mortgagor, in accordance with RESPA and any other       
applicable law;                                                                 

         (tt) Prior Servicing. Each Mortgage Loan has been serviced in all
material respects in strict compliance with Accepted Servicing Practices;       

          (uu) No Default Under First Lien. With respect to each Second Lien
Loan, the related First Lien Loan related thereto is in full force and effect,  
and there is no default, breach, violation or event which would permit          
acceleration existing under such first Mortgage or Mortgage Note, and no event  
which, 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 which    
would permit acceleration thereunder;                                           

       (vv) Right to Cure First Lien. With respect to each Second Lien
Loan, the related first lien Mortgage contains a provision which provides for   
giving notice of default or breach to the mortgagee under the Mortgage Loan and 
allows such mortgagee to cure any default under the related first lien Mortgage;

      (ww) No Failure to Cure Default. The Seller has not received a
written notice of default of any senior mortgage loan related to the Mortgaged  
Property which has not been cured;                                              

          (xx) Credit Information. As to each consumer report (as defined in
the Fair Credit Reporting Act, Public Law 91-508) or other credit information   
furnished by the Seller to the Purchaser, that Seller 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 from furnishing 
the same to any subsequent or prospective purchaser of such Mortgage. The Seller
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 or Servicing Rights thereto;             

       (yy) Leaseholds. If the Mortgage Loan is secured by a long-term
residential lease, (1) the lessor under the lease holds a fee simple interest in
the land; (2) the terms of such lease expressly permit the mortgaging of the    
leasehold estate, the assignment of the lease without the lessor's consent and  
the acquisition by the holder of the Mortgage of the rights of the lessee upon  
foreclosure or assignment in lieu of foreclosure or provide the holder of the   
Mortgage with substantially similar protections; (3) the terms of such lease do 
not (a) allow the termination thereof upon the lessee's default without the     
holder of the Mortgage being entitled to receive written notice of, and         
opportunity to cure, such default, (b) allow the termination of the lease in the
event of damage or destruction as long as the Mortgage is in existence, (c)     
prohibit the holder of the Mortgage from being insured (or receiving proceeds of
insurance) under the hazard insurance policy or policies relating to the        
Mortgaged Property or (d) permit any increase in rent other than pre-established
increases set forth in the lease; (4) the original term of such lease is not    
less than 15 years; (5) the term of such lease does not terminate earlier than  
five years after the maturity date of the Mortgage Note; and (6) the Mortgaged  
Property is located in a jurisdiction in which the use of leasehold estates in  
transferring ownership in residential properties is a widely accepted practice; 

   (zz) Prepayment Penalty. Each Mortgage Loan is subject to a
prepayment penalty as provided in the related Mortgage Note and set forth on the
related Mortgage Loan Schedule. Such prepayment penalty is in an amount equal to
the lesser of (a) the maximum amount permitted under applicable state law, and  
(b) if the Mortgaged Property is secured by residential real property located in
a state other than Arizona, Maine, Massachusetts, New York, South Carolina or   
Wisconsin, six months interest on the related prepaid amount. No such prepayment
penalty may be imposed for a term in excess of (y) with respect to Mortgage     
Loans originated prior to October 1, 2002, five (5) years from the date of      
origination and (z) with respect to Mortgage Loans originated on or after       
October 1, 2002, three (3) years from the date of origination;                  

            (aaa) 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;                                                                            

        (bbb) Single-premium credit life insurance policy. In connection
with the origination of the Mortgage Loan, no proceeds from such Mortgage Loan  
were used to finance or acquire a single-premium credit life insurance policy;  

   (ccc) Qualified Mortgage. The Mortgage Loan is a "qualified
mortgage" within the meaning of Section 860G(a)(3) of the Code;                 

(ddd) [Reserved];                                       

           (eee) Fair Credit Reporting Act. The Seller 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;                                       

        (fff) Fannie Mae Guides Anti-Predatory Lending Eligibility. Each
Mortgage Loan is in compliance with the anti-predatory lending eligibility for  
purchase requirements of Fannie Mae Guides;                                     

          (ggg) Mortgagor Selection. No Mortgagor was encouraged or required
to select a Mortgage Loan product offered by the Originator which is a higher   
cost product designed for less creditworthy mortgagors, unless at the time of   
the Mortgage Loan's origination, such Mortgagor did not qualify taking into     
account credit history and debt to income ratios for a lower cost credit product
then offered by the Originator or any Affiliate of the Originator. If, at the   
time of loan application, the Mortgagor may have qualified for a lower cost     
credit product then offered by any mortgage lending Affiliate of the Originator,
the Originator referred the related Mortgagor's application to such Affiliate   
for underwriting consideration;                                                 

            (hhh) Underwriting Methodology. The methodology used in underwriting
the extension of credit for each Mortgage Loan employs objective mathematical   
principles which relate the related Mortgagor's income, assets and liabilities  
to the proposed payment and such underwriting methodology does not rely on the  
extent of the related Mortgagor's equity in the collateral as the principal     
determining factor in approving such credit extension. Such underwriting        
methodology confirmed that at the time of origination (application/approval) the
related Mortgagor had a reasonable ability to make timely payments on the       
Mortgage Loan;                                                                  

          (iii) Mortgage Loans with Prepayment Premiums. 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 Mortgage Loan's origination,   
the related 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 Mortgage
Loan's origination, the related 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 related Mortgagor in the Mortgage Loan   
documents pursuant to applicable state and federal law, and (iv) notwithstanding
any state or federal law to the contrary, the Originator, as servicer, shall not
impose such prepayment premium in any instance when the mortgage debt is        
accelerated as the result of the related Mortgagor's default in making the      
Mortgage Loan payments;                                                         

          (jjj) Purchase of Insurance. No Mortgagor was required to purchase
any single premium credit insurance policy (e.g., life, disability, property,   
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, property, 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 as 
part of the origination of, or as a condition to closing, such Mortgage Loan;   

           (kkk) 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 Fannie Mae's 
anti-predatory lending requirements as set forth in the Fannie Mae Guides;      

  (lll) Disclosure of Fees and Charges. All fees and charges
(including finance charges), whether or not financed, assessed, collected or to 
be collected in connection with the origination and servicing of each Mortgage  
Loan, have been disclosed in writing to the Mortgagor in accordance with        
applicable state and federal law and regulation; and                            

          (mmm) No Arbitration. No Mortgage Loan originated on or after July
1, 2004 requires the related Mortgagor to submit to arbitration to resolve any  
dispute arising out of or relating in any way to the Mortgage Loan transaction. 

  Subsection 9.03 Remedies for Breach of Representations and
Warranties.                                                                     

           It is understood and agreed that the representations and warranties
set forth in Subsections 9.01 and 9.02 shall survive the sale of the Mortgage   
Loans to the Purchaser and shall inure to the benefit of the Purchaser,         
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 Seller or the Purchaser of a breach of any of
the foregoing representations and warranties, the party discovering such breach 
shall give prompt written notice to the other.                                  

         Within 60 days of the earlier of either discovery by or notice to
the Seller of any such breach of a representation or warranty, which materially 
and adversely affects the value of the Mortgage Loans or the interest of the    
Purchaser therein (or which materially and adversely affects the value of the   
applicable Mortgage Loan or the interest of the Purchaser therein in the case of
a representation and warranty relating to a particular Mortgage Loan), the      
Seller shall use its best efforts promptly to cure such breach in all material  
respects and, if such breach cannot be cured, the Seller shall, at the          
Purchaser's option, repurchase such Mortgage Loan at the Repurchase Price.      
Notwithstanding the above sentence, within 60 days of the earlier of either     
discovery by, or notice to, the Seller of any breach of the representations or  
warranties set forth in Paragraph (zz)(y), (zz)(z), (aaa), (bbb), (ccc), (eee), 
(fff), (ggg), (hhh), (iii), (jjj), (kkk), (lll) and (mmm) of Subsection 9.02,   
the Seller shall repurchase such Mortgage Loan at the Repurchase Price. In the  
event that a breach shall involve any representation or warranty set forth in   
Subsection 9.01, and such breach cannot be cured within 60 days of the earlier  
of either discovery by or notice to the Seller of such breach, all of the       
Mortgage Loans affected by such breach shall, at the Purchaser's option, be     
repurchased by the Seller at the Repurchase Price. However, if the breach shall 
involve a representation or warranty set forth in Subsection 9.02 (except as    
provided in the second sentence of this paragraph with respect to certain       
breaches for which no substitution is permitted) and the Seller discovers or    
receives notice of any such breach within 120 days of the related Closing Date, 
the Seller shall, at the Purchaser's option and provided that the Seller has a  
Qualified Substitute Mortgage Loan, rather than repurchase the Mortgage Loan as 
provided above, remove such Mortgage Loan (a "Deleted Mortgage Loan") and       
substitute in its place a Qualified Substitute Mortgage Loan or Loans, provided 
that any such substitution shall be effected not later than 120 days after the  
related Closing Date. If the Seller has no Qualified Substitute Mortgage Loan,  
it shall repurchase the deficient Mortgage Loan at the Repurchase Price. Any    
repurchase of a Mortgage Loan or Loans pursuant to the foregoing provisions of  
this Subsection 9.03 shall be accomplished by either (a) if the Servicing       
Agreement has been entered into and is in effect, deposit in the Custodial      
Account of the amount of the Repurchase Price for distribution to the Purchaser 
on the next scheduled Remittance Date, 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 or (b) if the Servicing Agreement 
has not been entered into or is no longer in effect, by direct remittance of the
Repurchase Price to the Purchaser or its designee in accordance with the        
Purchaser's instructions.                                                       

        At the time of repurchase or substitution, the Purchaser and the
Seller shall arrange for the reassignment of the Deleted Mortgage Loan to the   
Seller and the delivery to the Seller of any documents held by the Custodian    
relating to the Deleted Mortgage Loan. In the event of a repurchase or          
substitution, the Seller shall, simultaneously with such reassignment, give     
written notice to the Purchaser that such repurchase or substitution has taken  
place, amend the Mortgage Loan Schedule to reflect the withdrawal of the Deleted
Mortgage Loan from this Agreement, and, in the case of substitution, identify a 
Qualified Substitute Mortgage Loan and amend the related Mortgage Loan Schedule 
to reflect the addition of such Qualified Substitute Mortgage Loan to this      
Agreement. In connection with any such substitution, the Seller shall be deemed 
to have made as to such Qualified Substitute Mortgage Loan the representations  
and warranties set forth in this Agreement except that all such representations 
and warranties set forth in this Agreement shall be deemed made as of the date  
of such substitution. The Seller shall effect such substitution by delivering to
the Custodian or to such other party as the Purchaser may designate in writing  
for such Qualified Substitute Mortgage Loan the documents required by Subsection
6.03 and the Custodial Agreement, with the Mortgage Note endorsed as required by
Subsection 6.03 and the Custodial Agreement. No substitution will be made in any
calendar month after the Determination Date for such month. The Seller shall    
cause the Originator to remit directly to the Purchaser, or its designee in     
accordance with the Purchaser's instructions the Monthly Payment less the       
Servicing Fee due, if any, on such Qualified Substitute Mortgage Loan or Loans  
in the month following the date of such substitution. Monthly Payments due with 
respect to Qualified Substitute Mortgage Loans in the month of substitution     
shall be retained by the Seller. For the month of substitution, distributions to
the Purchaser shall include the Monthly Payment due on any Deleted Mortgage Loan
in the month of substitution, and the Seller shall thereafter be entitled to    
retain all amounts subsequently received by the Seller in respect of such       
Deleted Mortgage Loan.                                                          

            For any month in which the Seller substitutes a Qualified Substitute
Mortgage Loan for a Deleted Mortgage Loan, the Seller shall determine the amount
(if any) by which the aggregate principal balance of all Qualified Substitute   
Mortgage Loans as of the date of substitution is less than the aggregate Stated 
Principal Balance of all Deleted Mortgage Loans (after application of scheduled 
principal payments due in the month of substitution). The amount of such        
shortfall shall be distributed by the Seller directly to the Purchaser or its   
designee in accordance with the Purchaser's instructions within two (2) Business
Days of such substitution.                                                      

      In addition to such repurchase or substitution obligation, the
Seller shall indemnify the Purchaser and the Successor Servicer and hold such   
parties 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 Seller representations  
and warranties contained in this Agreement or any Reconstitution Agreement. It  
is understood and agreed that the obligations of the Seller set forth in this   
Subsection 9.03 to cure, substitute for or repurchase a defective Mortgage Loan 
and to indemnify the Purchaser and the Successor Servicer as provided in this   
Subsection 9.03 constitute the sole remedies of the Purchaser and the Successor 
Servicer respecting a breach of the foregoing representations and warranties.   

            Any cause of action against the Seller relating to or arising out of
the breach of any representations and warranties made in Subsections 9.01 and   
9.02 shall accrue as to any Mortgage Loan upon (i) discovery of such breach by  
the Purchaser or notice thereof by the Seller to the Purchaser, (ii) failure by 
the Seller to cure such breach or repurchase such Mortgage Loan as specified    
above, and (iii) demand upon the Seller by the Purchaser for compliance with    
this Agreement.                                                                 

Subsection 9.04 [RESERVED].                             

       Subsection 9.05 Repurchase of Mortgage Loans With First Payment
Defaults.                                                                       

           If the related Mortgagor is delinquent with respect to the Mortgage
Loan's first Monthly Payment either (i) after origination of such Mortgage Loan,
or (ii) after the related Closing Date, the Seller, at the Purchaser's option,  
shall repurchase such Mortgage Loan from the Purchaser at a price equal to the  
percentage of par as stated in the related Purchase Price and Terms Agreement   
(subject to adjustment as provided therein) multiplied by the then outstanding  
principal balance of such Mortgage Loan, plus accrued and unpaid interest       
thereon from the date to which interest was last paid through the day prior to  
the repurchase date at the applicable Mortgage Interest Rate, plus any          
outstanding advances owed to any servicer in connection with such Mortgage Loan.
A Mortgage Loan's first Monthly Payment after the related Closing Date shall be 
considered "delinquent" if such Monthly Payment has not been received by the    
Purchaser by the fifteenth (15th) day of the month following the month in which 
the Monthly Payment was due. The Purchaser shall have ninety (90) days following
any such delinquency to notify the Seller of any repurchase request and the     
Seller shall repurchase such delinquent Mortgage Loan within thirty (30) days of
the date of such request.                                                       

           Subsection 9.06 Repurchase of Certain Mortgage Loans That Prepay in
Full.                                                                           

           With respect to Mortgage Loans without prepayment penalties, in the
event that any such Mortgage Loan prepays in full either (i) on or before a     
Securitization Transaction or (ii) during the first six months following the    
related Closing Date, the Seller shall pay the Purchaser, within three (3)      
Business Days of such prepayment in full, the difference between the Purchase   
Price for such Mortgage Loan and the outstanding principal balance of such      
Mortgage Loan as of the related Cut-off Date.                                   

SECTION 10. Closing.                                    

           The closing for the purchase and sale of each Mortgage Loan Package
shall take place on the related Closing Date. At the Purchaser's option, each   
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 for the Mortgage Loans to be purchased on each Closing
Date shall be subject to each of the following conditions:                      

           (i)   at least two Business Days prior to the related Closing Date,
                  the Seller shall deliver to the Purchaser a magnetic diskette,
                or transmit by modem, a listing on a loan-level basis of the
              necessary information to compute the Purchase Price of the
            Mortgage Loans delivered on such Closing Date (including
            accrued interest), and prepare a Mortgage Loan Schedule;

           (ii)  all of the representations and warranties of the Seller under
            this Agreement and of the Originator under the Servicing
               Agreement (with respect to each Mortgage Loan, as specified
                therein) shall be true and correct as of the related Closing
               Date and no event shall have occurred which, with notice or
              the passage of time, would constitute a default under this
        Agreement or an Event of Default under the Servicing
Agreement;                                  

   (iii) the Purchaser shall have received, or the Purchaser's
                  attorneys shall have received in escrow, all closing documents
                  as specified in Section 11 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 terms hereof;               

           (iv)  the Seller shall have delivered and released to the Custodian
               all documents required pursuant to the Custodial Agreement;
and                                         

      (v)   all other terms and conditions of this Agreement and the
              related Purchase Price and Terms Agreement shall have been
complied with.                              

           Subject to the foregoing conditions, the Purchaser shall pay to the
Seller on the related Closing Date the Purchase Price, plus accrued interest    
pursuant to Section 4 of this Agreement, by wire transfer of immediately        
available funds to the account designated by the Seller.                        

SECTION 11. Closing Documents.                          

            The Closing Documents for the Mortgage Loans to be purchased on each
Closing Date shall consist of fully executed originals of the following         
documents:                                                                      

       1.    this Agreement (to be executed and delivered only for the
initial Closing Date);                      

            2.    the related Mortgage Loan Schedule (one copy to be attached to
             the Custodian's counterpart of the Custodial Agreement in
                connection with the initial Closing Date, and one copy to be
            attached to the related Assignment and Conveyance as the
Mortgage Loan Schedule thereto);            

          3.    a Custodian's Certification, as required under the Custodial
        Agreement, in the form of Exhibit 2 to the Custodial
Agreement;                                  

    4.    with respect to the initial Closing Date, an Officer's
                Certificate, in the form of Exhibit C hereto with respect to
        each of the Seller and the Originator, including all
                  attachments thereto; with respect to subsequent Closing Dates,
           an Officer's Certificate upon request of the Purchaser;

     5.    with respect to the initial Closing Date, an Opinion of
                 Counsel of the Seller (who may be an employee of the Seller),
               in the form of Exhibit D hereto ("Opinion of Counsel of the
                  Seller"); with respect to subsequent Closing Dates, an Opinion
           of Counsel of the Seller upon request of the Purchaser;

     6.    with respect to the initial Closing Date, an Opinion of
           Counsel of the Custodian (who may be an employee of the
          Custodian), in the form of an exhibit to the Custodial
Agreement;                                  

           7.    a Security Release Certification, in the form of Exhibit E or
                 F, as applicable, hereto executed by any person, as requested
              by the Purchaser, if any of the Mortgage Loans have at any
         time been subject to any security interest, pledge or
 hypothecation for the benefit of such person;

          8.    a certificate or other evidence of merger or change of name,
                signed or stamped by the applicable regulatory authority, if
            any of the Mortgage Loans were acquired by the Seller by
        merger or acquired or originated by the Seller while
                 conducting business under a name other than its present name,
if applicable;                              

        9.    with respect to the initial Closing Date, the Underwriting
      Guidelines to be attached hereto as Exhibit G; and

          10.   Assignment and Conveyance Agreement in the form of Exhibit H
hereto, and all exhibits thereto.           

       The Seller shall bear the risk of loss of the closing documents
until such time as they are received by the Purchaser or its attorneys.         

SECTION 12. Costs.                                      

        The Purchaser shall pay any commissions due its salesmen and the
legal fees and expenses of its attorneys and custodial fees. All other costs and
expenses incurred in connection with the transfer and delivery of the Mortgage  
Loans and the Servicing Rights including recording fees, fees for title policy  
endorsements and continuations, fees for recording Assignments of Mortgage, and 
the Seller's attorney's fees, shall be paid by the Seller.                      

SECTION 13. Cooperation of Seller with a Reconstitution.

           The Seller and the Purchaser agree that with respect to some or all
of the Mortgage Loans, after each Closing Date, on one or more dates (each, a   
"Reconstitution Date") at the Purchaser's sole option, the Purchaser may effect 
a sale (each a "Reconstitution") of some or all of the Mortgage Loans then      
subject to this Agreement, without recourse, to:                                

       (i)   Fannie Mae under its Cash Purchase Program or MBS Program
                  (Special Servicing Option) (each, a "Fannie Mae Transfer"); or

(ii)  Freddie Mac (the "Freddie Mac Transfer"); or      

          (iii) one or more third party purchasers in one or more Whole Loan
Transfers; or                               

          (iv)  one or more trusts or other entities to be formed as part of
one or more Securitization Transactions.    

            The Seller agrees to execute in connection with any Agency Transfer,
any and all pool purchase contracts, and/or agreements reasonably acceptable to 
the Seller among the Purchaser, the Seller, Fannie Mae or Freddie Mac (as the   
case may be) and any servicer in connection with a Whole Loan Transfer, a       
seller's warranties and servicing agreement or a participation and servicing    
agreement in form and substance reasonably acceptable to the Seller, and in     
connection with a Securitization Transaction, a pooling and servicing agreement 
in form and substance reasonably acceptable to the Seller (collectively the     
agreements referred to herein are designated, the "Reconstitution Agreements"). 

        With respect to each Whole Loan Transfer and each Securitization
Transaction entered into by the Purchaser, the Seller agrees (1) to cooperate   
fully with the Purchaser and any prospective purchaser with respect to all      
reasonable requests and due diligence procedures; (2) to execute, deliver and   
perform all Reconstitution Agreements required by the Purchaser; and (3) to     
restate the representations and warranties set forth in this Agreement and the  
Servicing Agreement as of the settlement or closing date in connection with such
Reconstitution that occurs on or prior to the date which is six (6) months      
following the related Closing Date and in connection with any Reconstitution on 
or after the date which is six (6) months following the related Closing Date, to
restate the representations and warranties set forth in this Agreement as of the
Closing Date (each, a "Reconstitution Date") or make the representations and    
warranties set forth in the related selling/servicing guide of the master       
servicer or issuer, as the case may be, in connection with such Reconstitution. 
The Seller shall use its reasonable best efforts to provide to such master      
servicer or issuer, as the case may be, and any other participants in such      
Reconstitution: (i) any and all information and appropriate verification of     
information which may be reasonably available to the Seller or its affiliates,  
whether through letters of its auditors and counsel or otherwise, as the        
Purchaser or any such other participant shall request; (ii) such additional     
representations, warranties, covenants, opinions of counsel, letters from       
auditors, and certificates of public officials or officers of the Seller or the 
Originator as are reasonably believed necessary by the Purchaser or any such    
other participant; and (iii) to execute, deliver and satisfy all conditions set 
forth in any indemnity agreement required by the Purchaser or any such          
participant. The Seller shall indemnify the Purchaser, each Affiliate designated
by the Purchaser and each Person who controls the Purchaser or such Affiliate   
and hold each of them harmless from and against any losses, damages, penalties, 
fines, forfeitures, reasonable and necessary legal fees and related costs,      
judgments, and any other costs, fees and expenses that each of them may sustain 
in any way related to any information provided by or on behalf of the Seller or 
the Originator regarding the Seller, the Originator, the Seller's or other      
originator's Static Pool Information, the Seller's and Originator's servicing   
practices or performance, the Mortgage Loans or the Underwriting Guidelines set 
forth in any offering document prepared in connection with any Reconstitution.  
For purposes of the previous sentence, "Purchaser" shall mean the Person then   
acting as the Purchaser under this Agreement and any and all Persons who        
previously were "Purchasers" under this Agreement. Moreover, the Seller agrees  
to cooperate with all reasonable requests made by the Purchaser to effect such  
Reconstitution Agreements.                                                      

        In the event the Purchaser has elected to have the Seller or the
Originator hold record title to the Mortgages, prior to the Reconstitution Date,
the Seller shall prepare an assignment of mortgage in blank or to the           
prospective purchaser or trustee, as applicable, from the Seller or the         
Originator, as applicable, acceptable to the prospective purchaser or trustee,  
as applicable, for each Mortgage Loan that is part of the Reconstitution and    
shall pay all preparation and recording costs associated therewith. In          
connection with the Reconstitution, the Seller shall execute or shall cause the 
Originator to execute each assignment of mortgage, track such Assignments of    
Mortgage to ensure they have been recorded and deliver them as required by the  
prospective purchaser or trustee, as applicable, upon the Seller's receipt      
thereof. Additionally, the Seller shall prepare and execute or shall cause the  
Originator to execute, at the direction of the Purchaser, any note endorsement  
in connection with any and all seller/servicer agreements.                      

All Mortgage Loans not sold or transferred pursuant to a
Reconstitution shall remain subject to this Agreement and, if the Servicing     
Agreement shall remain in effect with respect to the related Mortgage Loan      
Package, shall continue to be serviced in accordance with the terms of this     
Agreement and the Servicing Agreement and with respect thereto this Agreement   
shall remain in full force and effect.                                          

SECTION 14. The Seller.                                 

        Subsection 14.01 Additional Indemnification by the Seller; Third
Party Claims.                                                                   

           The Seller shall indemnify the Purchaser and the Successor Servicer
and hold such parties harmless against any and all claims, losses, damages,     
penalties, fines, forfeitures, reasonable and necessary legal fees and related  
costs, judgments, and any other costs, fees and expenses that such parties may  
sustain in any way related to the failure of the Seller to perform its duties   
and the Originator to service the Mortgage Loans in strict compliance with the  
terms of this Agreement or any Reconstitution Agreement entered into pursuant to
Section 13. The Seller immediately shall notify the Purchaser if a claim is made
by a third party with respect to this Agreement or any Reconstitution 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 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 Purchaser promptly shall reimburse the Seller for all amounts        
advanced by it pursuant to the preceding sentence, except when the claim is in  
any way related to the Seller's indemnification pursuant to Section 9, or is in 
any way related to the failure of the Originator or the Seller to service and   
administer the Mortgage Loans in strict compliance with the terms of this       
Agreement or any Reconstitution Agreement.                                      

Subsection 14.02 Merger or Consolidation of the Seller. 

     The Seller will keep in full effect its existence, rights and
franchises as a corporation under the laws of the state of its incorporation    
except as permitted herein, and will 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 Seller may be merged or consolidated, or
any corporation resulting from any merger, conversion or consolidation to which 
the Seller shall be a party, or any Person succeeding to the business of the    
Seller, shall be the successor of the Seller hereunder, without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding; provided, however, that the    
successor or surviving Person shall have a net worth of at least $25,000,000.   

SECTION 15. Financial Statements.                       

      The Seller understands that in connection with the Purchaser's
marketing of the Mortgage Loans, the Purchaser shall make available to          
prospective purchasers audited financial statements of the Seller for the most  
recently completed three fiscal years respecting which such statements are      
available, as well as a Consolidated Statement of Condition of the Seller at the
end of the last two fiscal years covered by such Consolidated Statement of      
Operations. The Seller shall also make available any comparable interim         
statements to the extent any such statements have been prepared by the Seller   
(and are available upon request to members or stockholders of the Seller or the 
public at large). The Seller, if it has not already done so, agrees to furnish  
promptly to the Purchaser copies of the statements specified above. The Seller  
shall also make available information on its servicing performance with respect 
to loans serviced for others, including delinquency ratios.                     

            The Seller also agrees to allow reasonable access to a knowledgeable
financial or accounting officer for the purpose of answering questions asked by 
any prospective purchaser regarding recent developments affecting the Seller or 
the financial statements of the Seller.                                         

   SECTION 16. Mandatory Delivery; Grant of Security Interest.

         The sale and delivery on the related Closing Date of the Mortgage
Loans described on the related Mortgage Loan Schedule is mandatory from and     
after the date of the execution of the related Purchase Price and Terms         
Agreement, it being specifically understood and agreed that each Mortgage Loan  
is unique and identifiable on the date hereof and that an award of money damages
would be insufficient to compensate the Purchaser for the losses and damages    
incurred by the Purchaser (including damages to prospective purchasers of the   
Mortgage Loans) in the event of the Seller's failure to deliver (i) each of the 
related Mortgage Loans or (ii) one or more Qualified Substitute Mortgage Loans  
or (iii) one or more Mortgage Loans otherwise acceptable to the Purchaser on or 
before the related Closing Date. The Seller hereby grants to the Purchaser a    
lien on and a continuing security interest in each Mortgage Loan and each       
document and instrument evidencing each such Mortgage Loan to secure the        
performance by the Seller of its obligations under the related Purchase Price   
and Terms Agreement, and the Seller agrees that it shall hold such Mortgage     
Loans in custody for the Purchaser subject to the Purchaser's (a) right to      
reject any Mortgage Loan (or Qualified Substitute Mortgage Loan) under the terms
of this Agreement and to require another Mortgage Loan (or Qualified Substitute 
Mortgage Loan) to be substituted therefor, and (b) obligation to pay the        
Purchase Price for the Mortgage Loans. All rights and remedies of the Purchaser 
under this Agreement are distinct from, and cumulative with, any other rights or
remedies under this Agreement or afforded by law or equity and all such rights  
and remedies may be exercised concurrently, independently or successively.      

SECTION 17. Notices.                                    

     All demands, notices and communications hereunder shall be in
writing and shall be deemed to have been duly given if mailed, by registered or 
certified mail, return receipt requested, or, if by other means, when received  
by the other party at the address as follows:                                   

(i)   if to the Seller:                     

NC Capital Corporation          
18400 Van Karman, Suite 1000    
Irvine, California 92612        
Attention:  Mr. Kevin Cloyd     

(ii)  if to the Purchaser:                  

    Morgan Stanley Mortgage Capital Inc.
1585 Broadway                   
New York, New York 10020        
                    Attention:  Peter Woroniecki - Whole Loan Operations
Manager                         
Fax:  212-507-3565              
          Email:  peter.woroniecki@morganstanley.com

with copies to:                 

Scott Samlin                    
Morgan Stanley - RFPG           
1585 Broadway                   
New York, New York 10036        
Fax: 212-507-6569               
     Email: scott.samlin@morganstanley.com

or such other address as may hereafter be furnished to the other party by like  
notice. Any such demand, notice or communication hereunder shall be deemed to   
have been received on the date delivered to or received at the premises of the  
addressee (as evidenced, in the case of registered or certified mail, by the    
date noted on the return receipt).                                              

SECTION 18. Severability Clause.                        

        Any part, provision representation or warranty of this Agreement
which is prohibited or unenforceable or is held to be void or unenforceable in  
any jurisdiction shall be ineffective, as to such jurisdiction, to the extent of
such prohibition or unenforceability without invalidating the remaining         
provisions hereof, and any such prohibition or unenforceability in any          
jurisdiction as to any Mortgage Loan shall not invalidate or render             
unenforceable such provision in any other jurisdiction. To the extent permitted 
by applicable law, the parties hereto waive any provision of law which prohibits
or renders void or unenforceable any provision hereof. If the invalidity of any 
part, provision, representation or warranty of this Agreement shall deprive any 
party of the economic benefit intended to be conferred by this Agreement, the   
parties shall negotiate, in good-faith, to develop a structure the economic     
effect of which is nearly as possible the same as the economic effect of this   
Agreement without regard to such invalidity.                                    

SECTION 19. Counterparts.                               

      This Agreement may be executed simultaneously in any number of
counterparts. Each counterpart shall be deemed to be an original, and all such  
counterparts shall constitute one and the same instrument.                      

SECTION 20. Governing Law.                              

      This Agreement shall be deemed in effect when a fully executed
counterpart thereof is received by the Purchaser in the State of New York and   
shall be deemed to have been made in the State of New York. The 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 the substantive laws of the State of New York (without regard to
conflicts of laws principles), except to the extent preempted by Federal law.   

SECTION 21. Intention of the Parties.                   

            It is the intention of the parties that the Purchaser is purchasing,
and the Seller is selling the Mortgage Loans and not a debt instrument of the   
Seller or another security. Accordingly, the parties hereto each intend to treat
the transaction for Federal income tax purposes as a sale by the Seller, and a  
purchase by the Purchaser, of the Mortgage Loans. Moreover, the arrangement     
under which the Mortgage Loans are held shall be consistent with classification 
of such arrangement as a grantor trust in the event it is not found to represent
direct ownership of the Mortgage Loans. The Purchaser shall have the right to   
review the Mortgage Loans and the related Mortgage Loan Files to determine the  
characteristics of the Mortgage Loans which shall affect the Federal income tax 
consequences of owning the Mortgage Loans and the Seller shall cooperate with   
all reasonable requests made by the Purchaser in the course of such review.     

  SECTION 22. Successors and Assigns; Assignment of Purchase
Agreement.                                                                      

    This Agreement shall bind and inure to the benefit of and be
enforceable by the Seller and the Purchaser and the respective permitted        
successors and assigns of the Seller and the successors and assigns of the      
Purchaser. This Agreement shall not be assigned, pledged or hypothecated by the 
Seller to a third party without the consent of the Purchaser. This Agreement may
be assigned, pledged or hypothecated by the Purchaser without the consent of the
Seller. In the event the Purchaser assigns this Agreement, and the assignee     
assumes any of the Purchaser's obligations hereunder, the Seller acknowledges   
and agrees to look solely to such assignee, and not to the Purchaser, for       
performance of the obligations so assumed and the Purchaser shall be relieved   
from any liability to the Seller with respect thereto.                          

SECTION 23. Waivers.                                    

        No term or provision of this Agreement may be waived or modified
unless such waiver or modification is in writing and signed by the party against
whom such waiver or modification is sought to be enforced.                      

SECTION 24. Exhibits.                                   

         The exhibits to this Agreement are hereby incorporated and made a
part hereof and are an integral part of this Agreement.                         

SECTION 25. General Interpretive Principles.            

     For purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:                              

          (a) the terms defined in this Agreement have the meanings assigned
to them in this Agreement and include the plural as well as the singular, and   
the use of any gender herein shall be deemed to include the other gender;       

           (b) accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles;   

       (c) references herein to "Articles," "Sections," "Subsections,"
"Paragraphs," and other subdivisions without reference to a document are to     
designated Articles, Sections, Subsections, Paragraphs and other subdivisions of
this Agreement;                                                                 

            (d) reference to a Subsection without further reference to a Section
is a reference to such Subsection as contained in the same Section in which the 
reference appears, and this rule shall also apply to Paragraphs and other       
subdivisions;                                                                   

        (e) the words "herein," "hereof," "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular     
provision; and                                                                  

           (f) the term "include" or "including" shall mean without limitation
by reason of enumeration.                                                       

SECTION 26. Reproduction of Documents.                  

     This Agreement and all documents relating thereto, including,
without limitation, (a) consents, waivers and modifications which may hereafter 
be executed, (b) documents received by any party at the closing, and (c)        
financial statements, certificates and other information previously or hereafter
furnished, may be reproduced by any photographic, photostatic, microfilm,       
micro-card, miniature photographic or other similar process. The parties agree  
that any such reproduction shall be admissible in evidence as the original      
itself in any judicial or administrative proceeding, whether or not the original
is in existence and whether or not such reproduction was made by a party in the 
regular course of business, and that any enlargement, facsimile or further      
reproduction of such reproduction shall likewise be admissible in evidence.     

SECTION 27. Further Agreements.                         

         The Seller and the Purchaser each agree to execute and deliver to
the other such reasonable and appropriate additional documents, instruments or  
agreements as may be necessary or appropriate to effectuate the purposes of this
Agreement.                                                                      

SECTION 28. 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 their comparable jurisdictions in which 
any or all of the Mortgaged Properties are situated, and in any other           
appropriate public recording office or elsewhere, such recordation to be        
effected at the Seller's expense in the event recordation is either necessary   
under applicable law or requested by the Purchaser at its sole option.          

SECTION 29. No Solicitation.                            

          From and after the related Closing Date, the Seller agrees that it
will not take any action or permit or cause any action to be taken by any of its
agents or affiliates, or by any independent contractors on the Seller's behalf, 
to personally, by telephone or mail, solicit the borrower or obligor under any  
Mortgage Loan for any purpose whatsoever, including to refinance a Mortgage     
Loan, in whole or in part, without (i) the prior written consent of the         
Purchaser; or (ii) written notice from the related borrower or obligor under a  
Mortgage Loan of such party's intention to refinance such Mortgage Loan. It is  
understood and agreed that all rights and benefits relating to the solicitation 
of any Mortgagors and the attendant rights, title and interest in and to the    
list of such Mortgagors and data relating to their Mortgages (including         
insurance renewal dates) shall be transferred to the Purchaser pursuant hereto  
on the related Closing Date and the Seller shall take no action to undermine    
these rights and benefits. Notwithstanding the foregoing, it is understood and  
agreed that promotions undertaken by the Seller or any affiliate of the Seller  
which are directed to the general public at large, including, without           
limitation, mass mailing based on commercially acquired mailing lists,          
newspaper, radio and television advertisements shall not constitute solicitation
under this Section 29.                                                          

SECTION 30. Waiver of Trial by Jury.                    

    THE SELLER AND THE PURCHASER EACH KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR RELATING TO THIS 
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.                              

SECTION 31. Submission To Jurisdiction; Waivers.        

The Seller hereby irrevocably and unconditionally:      

      (A) SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT, OR FOR RECOGNITION AND ENFORCEMENT OF ANY
JUDGMENT IN RESPECT THEREOF, TO THE NON-EXCLUSIVE GENERAL JURISDICTION OF THE   
COURTS OF THE STATE OF NEW YORK, THE FEDERAL COURTS OF THE UNITED STATES OF     
AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND APPELLATE COURTS FROM ANY    
THEREOF;                                                                        

         (B) CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT IN
SUCH COURTS AND, TO THE EXTENT PERMITTED BY LAW, WAIVES ANY OBJECTION THAT IT   
MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY  
SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT     
COURT AND AGREES NOT TO PLEAD OR CLAIM THE SAME;                                

           (C) AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR PROCEEDING
MAY BE EFFECTED BY MAILING A COPY THEREOF BY REGISTERED OR CERTIFIED MAIL (OR   
ANY SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO ITS ADDRESS SET    
FORTH HEREIN OR AT SUCH OTHER ADDRESS OF WHICH THE PURCHASER SHALL HAVE BEEN    
NOTIFIED; AND                                                                   

       (D) AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT
SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT
TO SUE IN ANY OTHER JURISDICTION.                                               

SECTION 32. Compliance With Regulation AB.              

Subsection 32.01 Intent of the Parties; Reasonableness. 

           The Purchaser and the Seller acknowledge and agree that the purpose
of Section 32 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 Seller acknowledges that investors in privately offered     
securities may require that the Purchaser or any 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 any 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 Seller 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 any Depositor in good faith for delivery of information under these          
provisions on the basis of evolving interpretations of Regulation AB. In        
connection with any Securitization Transaction, the Seller shall cooperate fully
with the Purchaser to deliver to the Purchaser (including any of its assignees  
or designees) and any Depositor, any and all statements, reports,               
certifications, records and any other information necessary in the good faith   
determination of the Purchaser or any Depositor to permit the Purchaser or such 
Depositor to comply with the provisions of Regulation AB, together with such    
disclosures relating to the Seller, any Third-Party Originator and the Mortgage 
Loans, or the servicing of the Mortgage Loans, reasonably believed by the       
Purchaser or any Depositor to be necessary in order to effect such compliance.  

         The Purchaser (including any of its assignees or designees) shall
cooperate with the Seller 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. 

         Subsection 32.02 Additional Representations and Warranties of the
Seller.                                                                         

           (a) The Seller shall be deemed to represent to the Purchaser and to
any Depositor, as of the date on which information is first provided to the     
Purchaser or any Depositor under Subsection 32.03 that, except as disclosed in  
writing to the Purchaser or such Depositor prior to such date: (i) the Seller is
not aware and has not received notice that any default, early amortization or   
other performance triggering event has occurred as to any other securitization  
due to any act or failure to act of the Seller; (ii) the Interim Servicer 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 Interim Servicer as servicer has been disclosed or reported by the
Seller; (iv) no material changes to the Interim Servicer's policies or          
procedures with respect to the servicing function it will perform under the     
Interim Servicing Agreement and any Reconstitution Agreement for mortgage loans 
of a type similar to the Mortgage Loans have occurred during the three-year     
period immediately preceding the related Securitization Transaction; (v) there  
are no aspects of the Interim Servicer's financial condition that could have a  
material adverse effect on the performance by the Interim Servicer of its       
servicing obligations under the Interim Servicing Agreement or any              
Reconstitution Agreement; (vi) there are no material legal or governmental      
proceedings pending (or known to be contemplated) against the Seller, Interim   
Servicer, any Subservicer or any Third-Party Originator; and (vii) there are no 
affiliations, relationships or transactions relating to the Seller, Interim     
Servicer, any Subservicer or any Third-Party Originator with respect to any     
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 any Depositor on any date
following the date on which information is first provided to the Purchaser or   
any Depositor under Subsection 32.03, the Seller 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.                                               

  Subsection 32.03 Information to Be Provided by the Seller.

          In connection with any Securitization Transaction the Seller shall
(i) within five Business Days following request by the Purchaser or any         
Depositor, provide to the Purchaser and such Depositor (or, as applicable, cause
each Third-Party Originator to provide), in writing and in form and substance   
reasonably satisfactory to the Purchaser and such Depositor, the information and
materials specified in paragraphs (a) and (b) of this Section, and (ii) as      
promptly as practicable following notice to or discovery by the Seller, provide 
to the Purchaser and any Depositor (in writing and in form and substance        
reasonably satisfactory to the Purchaser and such Depositor) the information    
specified in paragraph (d) of this Section.                                     

         (a) If so requested by the Purchaser or any Depositor, the Seller
shall provide such information regarding (i) the Seller, as originator of the   
Mortgage Loans (including as an acquirer of Mortgage Loans from a Qualified     
Correspondent), or (ii) each Third-Party Originator, as is requested for the    
purpose of compliance with Items 1103(a)(1), 1105, 1110, 1117 and 1119 of       
Regulation AB. Such information shall include, at a minimum:                    

(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 any 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 any 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 Seller and each   
Third-Party Originator; and                                         

        (D) a description of any affiliation or relationship between the
     Seller, each Third-Party Originator and any of the following parties to a
    Securitization Transaction, as such parties are identified to the Seller
by the Purchaser or any Depositor in writing in advance of such     
Securitization Transaction:                                         

(1) the sponsor;                            
(2) the depositor;                          
(3) the issuing entity;                     
(4) any servicer;                           
(5) any trustee;                            
(6) any originator;                         
(7) any significant obligor;                
(8) any enhancement or support provider; and
(9) any other material transaction party.   

         (b) If so requested by the Purchaser or any Depositor, the Seller
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 Seller, if the Seller is an originator of Mortgage Loans  
(including as an acquirer of Mortgage Loans from a Qualified Correspondent),    
and/or (ii) each Third-Party Originator. Such Static Pool Information shall be  
prepared in form and substance reasonably satisfactory to the Purchaser by the  
Seller (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 Seller (or Third-Party     
Originator) Static Pool Information with respect to more than one mortgage loan 
type, the Purchaser or any Depositor shall be entitled to specify whether some  
or all of such information shall be provided pursuant to this paragraph. 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.                                                                     

            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 Seller shall provide corrected Static Pool     
Information to the Purchaser or any Depositor, as applicable, in the same format
in which Static Pool Information was previously provided to such party by the   
Seller.                                                                         

           If so requested by the Purchaser or any Depositor, the Seller 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  
Seller's or Third-Party Originator's originations or purchases, to calendar     
months commencing January 1, 2006, as the Purchaser or such Depositor shall     
reasonably request. Such letters shall be addressed to and be for the benefit of
such parties as the Purchaser or such Depositor shall designate, which may      
include, by way of example, any Sponsor, any Depositor and any broker dealer    
acting as underwriter, placement agent or initial purchaser with respect to a   
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 such      
Depositor.                                                                      

(c) [Reserved].                                         

     (d) If so requested by the Purchaser or any Depositor for the
purpose of satisfying its reporting obligation under the Exchange Act with      
respect to any class of asset-backed securities, the Seller shall (or shall     
cause each Third-Party Originator to) (i) notify the Purchaser and any Depositor
in writing of (A) any material litigation or governmental proceedings pending   
against the Seller or any Third-Party Originator and (B) any affiliations or    
relationships that develop following the closing date of a Securitization       
Transaction between the Seller 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 such     
Securitization Transaction, and (ii) provide to the Purchaser and any Depositor 
a description of such proceedings, affiliations or relationships.               

Subsection 32.04 Indemnification; Remedies.             

           (a) The Seller shall indemnify the Purchaser, each affiliate of the
Purchaser, and each of the following parties participating in a Securitization  
Transaction: each sponsor and issuing entity; each Person responsible for the   
preparation, execution or filing of any report required to be filed with the    
Commission with respect to such 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 such 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:                                  

            (1) (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 in written or electronic form under this
    Section 32 by or on behalf of the Seller, or provided under this Section
32 by or on behalf of any Third-Party Originator (collectively, the 
      "Seller Information"), or (B) the omission or alleged omission to state in
      the Seller Information a material fact required to be stated in the Seller
    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 Seller Information and not to any
   other information communicated in connection with a sale or purchase of
securities, without regard to whether the Seller Information or any 
    portion thereof is presented together with or separately from such other
information;                                                        

      (2) any failure by the Seller or any Third-Party Originator to
  deliver any information, report, certification, accountants' letter or
other material when and as required under this Section 32; or       

        (3) any breach by the Seller of a representation or warranty set
forth in Subsection 32.02(a) or in a writing furnished pursuant to  
      Subsection 32.02(b) and made as of a date prior to the closing date of the
     related Securitization Transaction, to the extent that such breach is not
cured by such closing date, or any breach by the Seller of a        
    representation or warranty in a writing furnished pursuant to Subsection
     32.02(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)(2)
of this Section, the Seller shall promptly reimburse the Purchaser, any         
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 such 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 such 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 Seller or
any Third-Party Originator.                                                     

      (b) Any failure by the Seller or any Third-Party Originator to
deliver any information, report, certification, accountants' letter or other    
material when and as required under this Section 32, or any breach by the Seller
of a representation or warranty set forth in Subsection 32.02(a) or in a writing
furnished pursuant to Subsection 32.02(b) and made as of a date prior to the    
closing date of the related Securitization Transaction, to the extent that such 
breach is not cured by such closing date, or any breach by the Seller of a      
representation or warranty in a writing furnished pursuant to Subsection        
32.02(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 Seller under this Agreement and any        
applicable Reconstitution Agreement, and shall entitle the Purchaser or         
Depositor, as applicable, in its sole discretion to terminate the rights and    
obligations of the Interim Servicer as servicer under the Interim Servicing     
Agreement and/or any applicable Reconstitution Agreement without payment        
(notwithstanding anything in this Agreement or any applicable Reconstitution    
Agreement to the contrary) of any compensation to the Interim Servicer; provided
that to the extent that any provision of this Agreement and/or any applicable   
Reconstitution Agreement expressly provides for the survival of certain rights  
or obligations following termination of the Interim Servicer as servicer, such  
provision shall be given effect.                                                

 [Signatures Commence on Following Page]

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          IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed hereto by their respective officers thereunto duly authorized
as of the date first above written.                                             

                                  MORGAN STANLEY MORTGAGE CAPITAL INC.
                       (Purchaser)

 By:
                                        ------------------------------------
   Name:
                                          ----------------------------------
    Title:
                                           ---------------------------------

                    NC CAPITAL CORPORATION
                    (Seller)

 By:
                                        ------------------------------------
   Name:
                                          ----------------------------------
    Title:
                                           ---------------------------------

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                                                                       Exhibit A

EXHIBIT A   
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 delivered to the    
Custodian, or to such other Person as the Purchaser shall designate in writing, 
pursuant to Section 6 of the Third Amended and Restated Mortgage Loan Purchase  
and Warranties Agreement to which this Exhibit is attached (the "Agreement"):   

  (c) (a) the original Mortgage Note bearing all intervening
endorsements, endorsed "Pay to the order of _________, without recourse" and    
signed in the name of the last endorsee (the "Last Endorsee") by an authorized  
officer. To the extent that there is no room on the face of the Mortgage Notes  
for endorsements, the endorsement may be contained on an allonge, if state law  
so allows and the Custodian is so advised by the Seller that state law so       
allows. If the Mortgage Loan was acquired by the Seller in a merger, the        
endorsement must be by "[Last Endorsee], successor by merger to [name of        
predecessor]". If the Mortgage Loan was acquired or originated by the Last      
Endorsee while doing business under another name, the endorsement must be by    
"[Last Endorsee], formerly known as [previous name]";                           

         (d) the original of any guarantee executed in connection with the
Mortgage Note;                                                                  

           (e) the original Mortgage with evidence of recording thereon. If in
connection with any Mortgage Loan, the Seller 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 Seller 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    
Seller (or certified by the title company, escrow agent, or closing attorney)   
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 Seller; 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 to be 
a true and complete copy of the original recorded Mortgage;                     

           (f) the originals of all assumption, modification, consolidation or
extension agreements, if any, with evidence of recording thereon;               

          (g) the original Assignment of Mortgage for each Mortgage Loan, in
form and substance acceptable for recording. The Assignment of Mortgage must be 
duly recorded only if recordation is either necessary under applicable law or   
commonly required by private institutional mortgage investors in the area where 
the Mortgaged Property is located or on direction of the Purchaser as provided  
in this Agreement. If the Assignment of Mortgage is to be recorded, the Mortgage
shall be assigned to the Purchaser. If the Assignment of Mortgage is not to be  
recorded, the Assignment of Mortgage shall be delivered in blank. If the        
Mortgage Loan was acquired by the Seller in a merger, the Assignment of Mortgage
must be made by "[Seller], successor by merger to [name of predecessor]". If the
Mortgage Loan was acquired or originated by the Seller while doing business     
under another name, the Assignment of Mortgage must be by "[Seller], formerly   
known as [previous name]";                                                      

        (h) the originals of all intervening assignments of mortgage (if
any) evidencing a complete chain of assignment from the Originator to the Last  
Endorsee 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 Seller 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 Officers          
Certificate of the Seller (or certified by the title company, escrow agent, or  
closing attorney) 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 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 Seller; 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;                                                         

       (i) the original mortgagee policy of title insurance or, in the
event such original title policy is unavailable, a certified true copy of the   
related policy binder or commitment for title certified to be true and complete 
by the title insurance company;                                                 

   (j) the original or, if unavailable, a copy of any security
agreement, chattel mortgage or equivalent document executed in connection with  
the Mortgage; and                                                               

       (k) if any of the above documents has been executed by a person
holding a power of attorney, an original or photocopy of such power certified by
the Seller to be a true and correct copy of the original.                       

           In the event an Officer's Certificate of the Seller is delivered to
the Purchaser because of a delay caused by the public recording office in       
returning any recorded document, the Seller shall deliver to the Purchaser,     
within 90 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. An extension of the date specified in clause (iv)   
above may be requested from the Purchaser, which consent shall not be           
unreasonably withheld.                                                          

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                                                                       Exhibit B

 EXHIBIT B

[RESERVED]

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                                                                       Exhibit C

 EXHIBIT C

SELLER'S OFFICER'S CERTIFICATE

          I, ____________________, hereby certify that I am the duly elected
[Vice] President of ________________ [COMPANY], a [state] [federally] chartered 
institution organized under the laws of the [state of ____________] [United     
States] (the "Company") and further as follows:                                 

            1. Attached hereto as Exhibit 1 is a true, correct and complete copy
  of the charter of the Company which is in full force and effect on the
date hereof and which has been in effect without amendment, waiver, 
rescission or modification since ___________.                       

            2. Attached hereto as Exhibit 2 is a true, correct and complete copy
   of the bylaws of the Company which are in effect on the date hereof and
which have been in effect without amendment, waiver, rescission or  
modification since ___________.                                     

          3. Attached hereto as Exhibit 3 is an original certificate of good
     standing of the Company issued within ten days of the date hereof, and no
event has occurred since the date thereof which would impair such   
standing.                                                           

            4. Attached hereto as Exhibit 4 is a true, correct and complete copy
 of the corporate resolutions of the Board of Directors of the Company
    authorizing the Company to execute and deliver (a) the Third Amended and
 Restated Mortgage Loan Purchase and Warranties Agreement, dated as of
      _______ __, 200_, by and between Morgan Stanley Mortgage Capital Inc. (the
"Purchaser") and the Company (the "Purchase Agreement") and (b) the 
     Amended and Restated Interim Servicing Agreement, dated as of _______ __,
   200_, by and between the Purchaser and New Century Mortgage Corporation
(the "Servicing Agreement"), [and to endorse the Mortgage Notes and 
execute the Assignments of Mortgages by original [or facsimile]     
      signature], and such resolutions are in effect on the date hereof and have
      been in effect without amendment, waiver, rescission or modification since
____________.                                                       

         5. Either (i) 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 the Purchase Agreement, the Servicing Agreement, [the sale of the
   mortgage loans] or the consummation of the transactions contemplated by
    the agreements; or (ii) any required consent, approval, authorization or
order has been obtained by the Company.                             

            6. Neither the consummation of the transactions contemplated by, nor
   the fulfillment of the terms of the Purchase Agreement or the Servicing
    Agreement conflicts or will conflict with or results or will result in a
      breach of or constitutes or will constitute a default under the charter or
    by-laws of the Company or, to the best of my knowledge, the terms of any
      indenture or other agreement or instrument to which the Company is a party
or by which it is bound or to which it is subject, or any statute or
order, rule, regulations, writ, injunction or decree of any court,  
     governmental authority or regulatory body to which the Company is subject
or by which it is bound.                                            

            7. To the best of my knowledge, there is no action, suit, proceeding
   or investigation pending or threatened against the Company which, in my
   judgment, 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 in any material liability on the part of
      the Company or which would draw into question the validity of the Purchase
 Agreement or the Servicing Agreement, or the mortgage loans or of any
action taken or to be taken in connection with the transactions     
  contemplated hereby, or which would be likely to impair materially the
ability of the Company to perform under the terms of the Purchase   
Agreement or the Servicing Agreement.                               

     8. Each person listed on Exhibit 5 attached hereto who, as an
officer or representative of the Company, signed (a) the Purchase   
      Agreement, (b) the Servicing Agreement or (c) any other document delivered
  or on the date hereof in connection with any purchase described in the
   agreements set forth above was, at the respective times of such signing
and delivery, and is now, 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 5, and the signatures of such
persons appearing on such documents are their genuine signatures.   

       9. The Company is duly authorized to engage in the transactions
  described and contemplated in the Purchase Agreement and the Servicing
Agreement.                                                          

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          IN WITNESS WHEREOF, I have hereunto signed my name and affixed the
seal of the Company.                                                            

Dated:____________________    By:___________________________                    
          Name:_________________________
[Seal]                        Title: [Vice] President                           

I, ________________________, an [Assistant] Secretary of
______________[COMPANY], hereby certify that ____________ is the duly elected,  
qualified and acting [Vice] President of the Company and that the signature     
appearing above is [her] [his] genuine signature.                               

IN WITNESS WHEREOF, I have hereunto signed my name.     

Dated:____________________    By:___________________________                    
          Name:_________________________
        Title: [Assistant] Secretary

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EXHIBIT 5 to
 Company's Officer's Certificate

 NAME                       TITLE                  SIGNATURE
 ----                       -----                  ---------

_________________________  __________________________  _________________________

_________________________  __________________________  _________________________

_________________________  __________________________  _________________________

_________________________  __________________________  _________________________

_________________________  __________________________  _________________________

_________________________  __________________________  _________________________

_________________________  __________________________  _________________________

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                                                                       Exhibit D

 EXHIBIT D

 FORM OF OPINION OF COUNSEL TO THE SELLER AND ORIGINATOR

(date)

Morgan Stanley Mortgage Capital Inc.                                            
1585 Broadway, 2nd Floor                                                        
New York, New York  10036                                                       

Dear Sirs:                                                                      

     You have requested [our] [my] opinion, as [Assistant] General
Counsel to ___________________ (the "Company"), with respect to certain matters 
in connection with the sale by the Company of the Mortgage Loans pursuant to    
that certain Third Amended and Restated Mortgage Loan Purchase and Warranties   
Agreement by and between the Company and Morgan Stanley Mortgage Capital Inc.   
(the "Purchaser"), dated as of _________ __, 200_ (the "Purchase Agreement") and
the Amended and Restated Interim Servicing Agreement, by and between the        
Purchaser and New Century Mortgage Corporation (the "Originator"), dated as of  
_________ __, 200_ (the "Servicing Agreement", and together with the Purchase   
Agreement, the "Agreements"). which sale is in the form of whole loans.         
Capitalized terms not otherwise defined herein have the meanings set forth in   
the Purchase Agreement and the Servicing Agreement.                             

[We]  [I] have examined the following documents:        

1.    the Agreements;                                   

2.    the form of Assignment of Mortgage;               

3.    the form of endorsement of the Mortgage Notes; and

        4.    such other documents, records and papers as we have deemed
       necessary and relevant as a basis for this opinion.

         To the extent [we] [I] have deemed necessary and proper, [we] [I]
have relied upon the representations and warranties of the Company and the      
Originator contained in the Agreements. [We] [I] have assumed the authenticity  
of all documents submitted to [us] [me] as originals, the genuineness of all    
signatures, the legal capacity of natural persons and the conformity to the     
originals of all documents.                                                     

Based upon the foregoing, it is [our] [my] opinion that:

      1.    The Company and the Originator are [type of entity] duly
              organized, validly existing and in good standing under the
             laws of the [United States] and are qualified to transact
                business in, and is in good standing under, the laws of [the
state of incorporation].                    

            2.    Each of the Company and the Originator has the power to engage
              in the transactions contemplated by the Agreements and all
             requisite power, authority and legal right to execute and
               deliver the Agreements and to perform and observe the terms
and conditions of the Agreements.           

   3.    Each Agreement has been duly authorized, executed and
               delivered by the Company and the Originator, as applicable,
              and is a legal, valid and binding agreement enforceable in
         accordance with its terms against the Company and the
             Originator, as applicable, subject to bankruptcy laws and
                 other similar laws of general application affecting rights of
            creditors and subject to the application of the rules of
          equity, including those respecting the availability of
                 specific performance, none of which will materially interfere
               with the realization of the benefits provided thereunder or
         with the Purchaser's ownership of the Mortgage Loans.

  4.    Each of the Company and the Originator has been duly
                  authorized to allow any of its officers to execute any and all
            documents by original signature in order to complete the
transactions contemplated by the Agreements.

      [5.   The Company has been duly authorized to allow any of its
                officers to execute by original [or facsimile] signature the
             endorsements to the Mortgage Notes and the Assignments of
               Mortgages, and the original [or facsimile] signature of the
            officer at the Company executing the endorsements to the
                  Mortgage Notes and the Assignments of Mortgages represents the
              legal and valid signature of said officer of the Company].

            6.    Either (i) 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 or the
                Originator of or compliance by the Company or the Originator
                 with the Agreements and the sale of the Mortgage Loans by the
                Company or the consummation of the transactions contemplated
             by the Agreements or (ii) any required consent, approval,
                  authorization or order has been obtained by the Company or the
Originator.                                 

           7.    Neither the consummation of the transactions contemplated by,
                 nor the fulfillment of the terms of, the Agreements conflicts
                  or will conflict with or results or will result in a breach of
                 or constitutes or will constitute a default under the charter
               or by-laws of the Company or the Originator, as applicable,
              or, to the best of my knowledge, the material terms of any
           indenture or other agreement or instrument to which the
                Company or the Originator is a party or by which it is bound
                or to which it is subject, or violates any statute or order,
               rule, regulations, writ, injunction or decree of any court,
                  governmental authority or regulatory body to which the Company
         or the Originator is subject or by which it is bound.

           8.    There is no action, suit, proceeding or investigation pending
               or, to the best of [our] [my] knowledge, threatened against
                the Company or the Originator which, in [our] [my] judgment,
                 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
                the Originator or in any material impairment of the right or
            ability of the Company or the Originator to carry on its
              business substantially as now conducted or in any material
             liability on the part of the Company or the Originator or
                 which would draw into question the validity of the Agreements
                  or the Mortgage Loans or of any action taken or to be taken in
             connection with the transactions contemplated thereby, or
                 which would be likely to impair materially the ability of the
               Company or the Originator to perform under the terms of the
Agreements.                                 

       9.    The sale of each Mortgage Note and Mortgage as and in the
                manner contemplated by the Purchase Agreement, is sufficient
           to fully transfer to the Purchaser all right, title and
                interest of the Company thereto as noteholder and mortgagee.

          10.   The Mortgages have been duly assigned and the Mortgage Notes
        have been duly endorsed as provided in the Custodial
                  Agreement. The Assignments of Mortgage are in recordable form,
                  except for the insertion of the name of the assignee, and upon
               the name of the assignee being inserted, are acceptable for
            recording under the laws of the state where each related
                  Mortgaged Property is located. The endorsement of the Mortgage
                 Notes, the delivery to the Purchaser, or its designee, of the
             Assignments of Mortgage, and the delivery of the original
                  endorsed Mortgage Notes to the Purchaser, or its designee, are
             sufficient to permit the Purchaser to avail itself of all
                protection available under applicable law against the claims
              of any present or future creditors of the Company, and are
               sufficient to prevent any other sale, transfer, assignment,
             pledge or hypothecation of the Mortgages and the Mortgage
Notes by the Company from being enforceable.

    Except as otherwise set forth in the Agreements, I assume no
obligation to revise this opinion or alter its conclusions to update or support 
this letter to reflect any facts or circumstances that may hereafter develop.   

        This opinion is given to you for your sole benefit, and no other
person or entity is entitled to rely hereon except that the purchaser or        
purchasers to which you initially and directly resell the Mortgage Loans may    
rely on this opinion as if it were addressed to them as of the date of this     
opinion.                                                                        

                                 Very truly yours,

                                                ________________________________
                                [Name]
                                                     [Assistant] General Counsel

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                                                                       Exhibit E

 EXHIBIT E

FORM OF SECURITY RELEASE CERTIFICATION

                                                  ___________________, 200__

[Federal Home Loan Bank of                                                      
______ (the "Association")]                                                     
___________________________                                                     
___________________________                                                     
___________________________                                                     

Attention:  ___________________________                                         
___________________________                             

Re:   Notice of Sale and Release of Collateral                      
----------------------------------------                

Dear Sirs:                                                                      

            This letter serves as notice that ________________________ [COMPANY]
a [type of entity], organized pursuant to the laws of [the State of             
incorporation] (the "Company") has committed to sell to Morgan Stanley Mortgage 
Capital Inc. under the Third Amended and Restated Mortgage Loan Purchase and    
Warranties Agreement, dated as of ______ __, 200_, certain mortgage loans       
originated by the Association. The Company warrants that the mortgage loans to  
be sold to Morgan Stanley Mortgage Capital Inc. are in addition to and beyond   
any collateral required to secure advances made by the Association to the       
Company.                                                                        

      The Company acknowledges that the mortgage loans to be sold to
Morgan Stanley Mortgage Capital Inc. shall not be used as additional or         
substitute collateral for advances made by the Association. Morgan Stanley      
Mortgage Capital Inc. understands that the balance of the Company's mortgage    
loan portfolio may be used as collateral or additional collateral for advances  
made by the Association, and confirms that it has no interest therein.          

           Execution of this letter by the Association shall constitute a full
and complete release of any security interest, claim, or lien which the         
Association may have against the mortgage loans to be sold to Morgan Stanley    
Mortgage Capital Inc.                                                           

                                 Very truly yours,

                                                ________________________________

                                                By:_____________________________
                                                Name:___________________________
                                                Title:__________________________
                                                Date:___________________________

Acknowledged and approved:                                                      

[FEDERAL HOME LOAN BANK OF]                                                     

___________________________                                                     

By:______________________________                                               
Name:____________________________                                               
Title:___________________________                                               
Date:____________________________                                               

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                                                                       Exhibit F

 EXHIBIT F

FORM OF SECURITY RELEASE CERTIFICATION

 I. Release of Security Interest

         The financial institution named below hereby relinquishes any and
all right, title, interest, lien or claim of any kind it may have in all        
mortgage loans described on the attached Schedule A (the "Mortgage Loans"), to  
be purchased by Morgan Stanley Mortgage Capital Inc. from the company named on  
the next page (the "Company") pursuant to that certain Third Amended and        
Restated Mortgage Loan Purchase and Warranties Agreement, dated as of ______ __,
200_, and certifies that all notes, mortgages, assignments and other documents  
in its possession relating to such Mortgage Loans have been delivered and       
released to the Company or its designees, as of the date and time of the sale of
such Mortgage Loans to Morgan Stanley Mortgage Capital Inc. Such release shall  
be effective automatically without any further action by any party upon payment 
in one or more installments, in immediately available funds, of $_____________, 
in accordance with the wire instructions set forth below.                       

Name and Address and Wire Instructions of Financial Institution                 

________________________________                                    
(Name)                                          

________________________________                                    
(Address)                                         

By:_____________________________                                    

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II. Certification of Release

           The Company named below hereby certifies to Morgan Stanley Mortgage
Capital Inc. that, as of the date and time of the sale of the above-mentioned   
Mortgage Loans to Morgan Stanley Mortgage Capital Inc. the security interests in
the Mortgage Loans released by the above-named financial institution comprise   
all security interests relating to or affecting any and all such Mortgage Loans.
The Company warrants that, as of such time, there are and will be no other      
security interests affecting any or all of such Mortgage Loans.                 

                                                ________________________________

                                                By:_____________________________
                                                Title:__________________________
                                                Date:___________________________

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                                                                       Exhibit G

 EXHIBIT G

 UNDERWRITING GUIDELINES

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                                                                       Exhibit H

 EXHIBIT H

 FORM OF ASSIGNMENT AND CONVEYANCE AGREEMENT

           On this ___ day of __________, ____, ___________________ NC Capital
Corporation ("Seller"), as the Seller under (i) that certain Purchase Price and 
Terms Agreement, dated as of ___________, _____ (the "PPTA"), and (ii) that     
certain Third Amended and Restated Mortgage Loan Purchase and Warranties        
Agreement, dated as of December 1, 2005 (the "Purchase Agreement"), does hereby 
sell, transfer, assign, set over and convey to Morgan Stanley Mortgage Capital  
Inc. ("Purchaser") as the Purchaser under the Agreements (as defined below),    
without recourse, but subject to the terms of the Agreements, all right, title  
and interest of, in and to the Mortgage Loans listed on the Mortgage Loan       
Schedule attached hereto as Exhibit A (the "Mortgage Loans"), together with the 
Servicing Rights, and the Mortgage Files and all rights and obligations arising 
under the documents contained therein. Each Mortgage Loan subject to the        
Agreements was underwritten in accordance with, and conforms to, the            
Underwriting Guidelines attached hereto as Exhibit C. Pursuant to Section 6 of  
the Purchase Agreement, the Seller has delivered to the Custodian the documents 
for each Mortgage Loan to be purchased as set forth in the Purchase Agreement.  
The contents of each Servicing File required to be retained by New Century      
Mortgage Corporation ("Servicer"), as Originator/Servicer under that certain    
Amended and Restated Interim Servicing Agreement, dated as of December 1, 2005  
(the "Servicing Agreement") to service the Mortgage Loans pursuant to the       
Servicing Agreement and thus not delivered to the Purchaser are and shall be    
held in trust by the Servicer for the benefit of the Purchaser as the owner     
thereof. The Servicer's possession of any portion of the Servicing File is at   
the will of the Purchaser for the sole purpose of facilitating servicing of the 
related Mortgage Loan pursuant to the Servicing Agreement, and such retention   
and possession by the Servicer shall be in a custodial capacity only. The       
ownership of each Mortgage Note, Mortgage, the Servicing Rights 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 or the Servicer     
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 PPTA, the Purchase Agreement and the Servicing Agreement shall        
collectively be referred to as the "Agreements" herein.                         

       The Mortgage Loan Package characteristics of the Mortgage Loans
subject hereto are set forth on Exhibit B hereto.                               

   In accordance with Section 6 of the Purchase Agreement, the
Purchaser accepts the Mortgage Loans listed on Exhibit A attached hereto.       
Notwithstanding the foregoing the Purchaser does not waive any rights or        
remedies it may have under the Agreements.                                      

          Capitalized terms used herein and not otherwise defined shall have
the meanings set forth in the Purchase Agreement.                               

[SIGNATURE PAGE FOLLOWS]  

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      [SELLER]

                                     By:____________________________________

                                     Name:__________________________________

                                     Title:_________________________________

        [SERVICER]

                                     By:____________________________________

                                     Name:__________________________________

                                     Title:_________________________________

Accepted and Agreed:                                                            

MORGAN STANLEY MORTGAGE CAPITAL INC.                                            

By:______________________________                                               

Name:_________________________                                            

Title:________________________                                            

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 EXHIBIT A
TO ASSIGNMENT AND CONVEYANCE AGREEMENT

THE MORTGAGE LOANS

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 EXHIBIT B
TO ASSIGNMENT AND CONVEYANCE AGREEMENT

 REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE POOL
 CHARACTERISTICS OF EACH MORTGAGE LOAN PACKAGE

         Pool Characteristics of the Mortgage Loan Package as delivered on
the related Closing Date:                                                       

            No Mortgage Loan has: (1) an outstanding principal balance less than
$_________; (2) an origination date earlier than __ months prior to the related 
Cut-off Date; (3) a CLTV of greater than _____%; (4) a FICO Score of less than  
___; or (5) a debt-to-income ratio of more than __%. Each Mortgage Loan has a   
Mortgage Interest Rate of at least ___% per annum and an outstanding principal  
balance less than $_________. Each Adjustable Rate Mortgage Loan has an Index of
[_______].                                                                      

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 EXHIBIT C
TO ASSIGNMENT AND CONVEYANCE AGREEMENT

 UNDERWRITING GUIDELINES

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 EXHIBIT V

SUBSERVICING AGREEMENT

  THIS SUBSERVICING AGREEMENT (the "Agreement") is made and entered into
between JPMORGAN CHASE BANK, NATIONAL ASSOCIATION a national banking association
(hereinafter called "JPMCB") and CHASE HOME FINANCE LLC, a Delaware limited     
liability corporation (hereinafter called "CHF LLC") dated as of January 1,     
2006.                                                                           

RECITALS

 WHEREAS, JPMCB, as servicer, desires CHF LLC to act as subservicer on
certain mortgage loans (the "Subserviced Loans" as further defined below);      

     WHEREAS, CHF LLC desires to act as subservicer on behalf of JPMCB on such
Subserviced Loans;                                                              

WHEREAS, JPMCB and CHF LLC desire to set forth, in writing, their   
agreement as to the subservicing of the Subserviced Loans.                      

NOW, THEREFORE, JPMCB and CHF LLC hereby agree as follows:          

A.    MORTGAGE LOANS TO BE SUBSERVICED HEREUNDER                                

          The mortgage loans to be subserviced hereunder are all residential
    mortgage loans serviced by JPMCB pursuant to the Pooling and
         Servicing Agreement (the "PSA") dated as of January 1, 2006 among
    Morgan Stanley ABS Capital I Inc., JPMCB, as servicer, HomEq
         Servicing Corporation, NC Capital Corporation., and Deutsche Bank
            National Trust Company, relating to the Morgan Stanley ABS Capital I
    Inc. Trust 2006-NC1 securitization transaction (all of which
           mortgage loans are hereinafter referred to as "Subserviced Loans").

B.    GENERAL SUBSERVICING PROCEDURE:                                           

   CHF LLC shall service and administer the Subserviced Loans in
   accordance with (i) any federal, state or local statute, law,
        ordinance, rule, administrative interpretation, regulation, order,
           writ, injunction, directive, judgment, decree or other requirement of
        any governmental authority, as applicable to the Subserviced Loans
     (hereinafter referred to as "Applicable Law") and (ii) Accepted
Servicing Practices (as defined in the PSA).              

  It is agreed that CHF LLC, as subservicer, shall perform all
        servicing functions relative to the Subserviced Loans on behalf of
  JPMCB as are required to be performed by CHF pursuant to the
          Agreement Regarding Servicing and Subservicing between JPMCB and CHF
      dated effective as of January 1, 2005 (the "Primary Subservicing
           Agreement"). The Primary Subservicing Agreement requires, among other
         things, for CHF LLC to comply with (x) Regulation AB (as defined in
          the PSA) and (y) all terms and conditions of the operative agreement
     pursuant to which JPMCB is named servicer including the PSA. In
addition, CHF LLC shall perform all of the obligations,   
     responsibilities and duties of a "Subservicer" under the PSA. .

C.    SERVICING FEE:                                                            

      1.    The fee paid to CHF LLC hereunder for the Subserviced Loans shall be
          the "Servicing Fee" provided in the PSA less such amount as may be
set out in the Primary Subservicing Agreement.          

  2.    In addition to the foregoing, CHF LLC shall retain all ancillary
income that JPMCB is entitled to receive under the PSA. 

D.    TERMINATION OF AGREEMENT:                                                 

            JPMCB may, by written notice to CHF LLC, terminate this Agreement as
         to the Subserviced Loans in accordance with the provisions of the
Primary Subservicing Agreement.                         

E.    MISCELLANEOUS:                                                            

1.    This Agreement may not be modified or changed except by an    
  instrument in writing duly executed by all parties hereto.

   2.    This Agreement shall be construed and enforced in accordance with
the laws of the State of New York.                      

3.    To the extent of any conflict between the provisions of this  
           Agreement on the one hand and the Primary Subservicing Agreement on
         the other hand, the Primary Subservicing Agreement shall control.

    4.    Except for their proper successors and assigns, the parties hereto
            intend that no third party shall have any rights or claims by reason
of this Agreement.                                      

  5.    Headings in this Agreement are for convenience and are not to be
  used for interpreting or construing any provisions hereof.

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     IN WITNESS WHEREOF, each party has caused this instrument to be signed in
    its corporate name on its behalf by its proper officials duly authorized
as of January 1, 2006.                                              

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION   

By: /s/ Carol C. Rothweil                   
   -----------------------------------------
Its: Carol C. Rothweil, Vice President      
    ----------------------------------------

CHASE HOME FINANCE LLC                      

By: /s/ Carol C. Rothweil                   
   -----------------------------------------
Its: Carol C. Rothweil, Vice President      
    ----------------------------------------

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘8-K’ Filing		Date		First		Last			Other Filings
		8/25/10		63
		2/27/06		11		29			10-D
		2/25/06		63
Filed on:		2/14/06
For Period End:		1/27/06		3		66			424B5,  8-K/A
		1/25/06		3
		1/13/06		63
		1/1/06		1		88
		12/1/05		3		82
		4/25/05		49
		1/28/05		70
		1/7/05		3		70
		1/1/05		36		87
		7/1/04		7		70
		6/28/04		70
		3/30/04		70
		1/29/04		70
		12/30/03		70
		12/1/03		70
		10/22/03		70
		3/6/03		7		70
		10/1/02		7		70
		8/20/96		3
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