Prudential Securities Secured Financing Corp – ‘8-K’ for 5/1/99 – EX-4.1

On:  Wednesday, 6/9/99   ·   For:  5/1/99   ·   Accession #:  889812-99-1802   ·   File #:  33-84918

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Current Report   —   Form 8-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 8-K         Current Report                                         8     31K 
 2: EX-1.1      Asset Backed Notes                                    27     99K 
 3: EX-1.2      Indemnification Agreeement                            16     62K 
 4: EX-4.1      Indenture                                             88    434K 
 5: EX-4.2      Sale and Servicing Agreement                         116    417K 
 6: EX-4.3      Form of Note Insurance Policy and Endorsement          9     37K 
 7: EX-4.4      Unaffiliated Seller's Agreement                       66    226K 
 8: EX-4.5      Purchase Agreement and Assignment                     54    196K 
 9: EX-4.6      Glossary of Defined Terms                             37    141K 
10: EX-23.1     Consent of Independent Accountants                     1      8K 

EX-4.1   —   Indenture
Exhibit Table of Contents

EX-4.1
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HOMEGOLD HOME EQUITY LOAN TRUST 1999-1

Class A Home Equity Loan Asset Backed Notes, Series 1999-1

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

 INDENTURE

 Dated as of May 1, 1999

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

 FIRST UNION NATIONAL BANK

 Indenture Trustee

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                                TABLE OF CONTENTS                                                                  
                                                                                                               Page
                                                                                                                   
ARTICLE I          Definitions and Incorporation by Reference.....................................................2

     SECTION 1.1.  Definitions....................................................................................2
     SECTION 1.2.  Incorporation by Reference of the Trust Indenture Act..........................................2
     SECTION 1.3.  Rules of Construction..........................................................................3
     SECTION 1.4.  Conflict with TIA..............................................................................3

ARTICLE II         The Notes......................................................................................3

     SECTION 2.1.  Form...........................................................................................3
     SECTION 2.2.  Execution, Authentication and Delivery.........................................................4
     SECTION 2.3.  Registration; Registration of Transfer and Exchange............................................4
     SECTION 2.4.  Mutilated, Destroyed, Lost or Stolen Notes.....................................................5
     SECTION 2.5.  Persons Deemed Owners..........................................................................6
     SECTION 2.6.  Payment of Principal and Interest..............................................................7
     SECTION 2.7.  Cancellation...................................................................................7
     SECTION 2.8.  Release of Collateral..........................................................................7
     SECTION 2.9.  Book-Entry Notes...............................................................................8
     SECTION 2.10. Notices to Depository..........................................................................8
     SECTION 2.11. Definitive Notes...............................................................................8

ARTICLE III        Covenants......................................................................................9

     SECTION 3.1.  Payment of Principal and Interest..............................................................9
     SECTION 3.2.  Maintenance of Office or Agency................................................................9
     SECTION 3.3.  Money for Payments to Be Held in Trust.........................................................9
     SECTION 3.4.  Existence.....................................................................................10
     SECTION 3.5.  Protection of Trust Property..................................................................11
     SECTION 3.6.  Opinions as to Trust Property.................................................................11
     SECTION 3.7.  Performance of Obligations; Servicing of Mortgage Loans.......................................12
     SECTION 3.8.  Negative Covenants............................................................................13
     SECTION 3.9.  Annual Statement as to Compliance.............................................................13
     SECTION 3.10. Issuer May Not Consolidate....................................................................14
     SECTION 3.11. No Other Business.............................................................................14
     SECTION 3.12. No Borrowing; Use of Proceeds.................................................................14
     SECTION 3.13. Servicer's Obligations........................................................................14
     SECTION 3.14. Guarantees, Loans, Advances and Other Liabilities.............................................14
     SECTION 3.15. Capital Expenditures..........................................................................14
     SECTION 3.16. Compliance with Laws..........................................................................14
     SECTION 3.17. Restricted Payments...........................................................................14
     SECTION 3.18. Notice of Events of Default and Servicer Events of Default....................................15
     SECTION 3.19. Further Instruments and Acts..................................................................15
     SECTION 3.20. Amendments of Sale and Servicing Agreement and Trust Agreement................................15

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     SECTION 3.21. Income Tax Characterization...................................................................15
     SECTION 3.22. [Reserved]....................................................................................15

ARTICLE IV         Satisfaction and Discharge....................................................................15

     SECTION 4.1.  Satisfaction and Discharge of Indenture.......................................................15
     SECTION 4.2.  Application of Trust Money....................................................................16
     SECTION 4.3.  Repayment of Monies Held by Note Paying Agent.................................................16

ARTICLE V          Remedies......................................................................................17

     SECTION 5.1.  Events of Default.............................................................................17
     SECTION 5.2.  Acceleration of Maturity; Rescission and Annulment............................................17
     SECTION 5.3.  Remedies......................................................................................18
     SECTION 5.4.  Indenture Trustee Shall File Proofs of Claim..................................................19
     SECTION 5.5.  Indenture Trustee May Enforce Claims Without Possession of Notes..............................20
     SECTION 5.6.  Application of Money Collected................................................................20
     SECTION 5.7.  Limitation on Rights of Noteholders...........................................................20
     SECTION 5.8.  Unconditional Rights of Noteholders to Receive Principal and Interest.........................21
     SECTION 5.9.  Restoration of Rights and Remedies............................................................21
     SECTION 5.10. Rights and Remedies Cumulative................................................................21
     SECTION 5.11. Delay or Omission Not a Waiver................................................................22
     SECTION 5.12. Control by Insurer or Noteholders.............................................................22
     SECTION 5.13. Undertaking for Costs.........................................................................22
     SECTION 5.14. Waiver of Stay or Extension Laws..............................................................23
     SECTION 5.15. Action on Notes...............................................................................23
     SECTION 5.16. Performance and Enforcement of Certain Obligations............................................23
     SECTION 5.17. Subrogation...................................................................................23
     SECTION 5.18. Preference Claims.............................................................................24
     SECTION 5.19. Sale of Trust Estate..........................................................................24
     SECTION 5.20. Waiver of Past Defaults.......................................................................25

ARTICLE VI         The Indenture Trustee.........................................................................26

     SECTION 6.1.  Duties of Indenture Trustee...................................................................26
     SECTION 6.2.  Rights of Indenture Trustee...................................................................28
     SECTION 6.3.  Individual Rights of Indenture Trustee........................................................29
     SECTION 6.4.  Indenture Trustee's Disclaimer................................................................29
     SECTION 6.5.  Notice of Defaults............................................................................29
     SECTION 6.6.  Reports by Indenture Trustee to Holders.......................................................29
     SECTION 6.7.  Compensation and Indemnity....................................................................29
     SECTION 6.8.  Replacement of Indenture Trustee..............................................................30
     SECTION 6.9.  Successor Indenture Trustee by Merger.........................................................32
     SECTION 6.10. Appointment of Co-Indenture Trustee or Separate Indenture Trustee.............................32
     SECTION 6.11. Eligibility...................................................................................33
     SECTION 6.12. Preferential Collection of Claims Against Issuer..............................................33
     SECTION 6.13. Appointment and Powers........................................................................33
     SECTION 6.14. Performance of Duties.........................................................................34

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     SECTION 6.15. Limitation on Liability.......................................................................34
     SECTION 6.16. Reliance Upon Documents.......................................................................34
     SECTION 6.17. Representations and Warranties of the Indenture Trustee.......................................34
     SECTION 6.18. Waiver of Setoffs.............................................................................35
     SECTION 6.19. Suits for Enforcement.........................................................................35
     SECTION 6.20. Mortgagor Claims..............................................................................36
     SECTION 6.21. Certain Available Information.................................................................36

ARTICLE VII        Noteholders' Lists and Reports................................................................37

     SECTION 7.1.  Issuer to Furnish to Indenture Trustee Names and Addresses of Noteholders.....................37
     SECTION 7.2.  Preservation of Information; Communications to Noteholders....................................37
     SECTION 7.3.  Reports by Issuer.............................................................................37
     SECTION 7.4.  Reports by Indenture Trustee..................................................................38

ARTICLE VIII       Accounts; Investment of Moneys; Collection and Application of Moneys; Reports.................38

     SECTION 8.1.  Collection of Money...........................................................................38
     SECTION 8.2.  Release of Trust Property.....................................................................38
     SECTION 8.3.  Payments......................................................................................39
     SECTION 8.4.  Compliance with Withholding Requirements......................................................42
     SECTION 8.5.  Statements to Noteholders.....................................................................43
     SECTION 8.6.  Rights of Noteholders.........................................................................43
     SECTION 8.7.  Distribution Account..........................................................................43
     SECTION 8.8.  [Reserved]....................................................................................44
     SECTION 8.9.  [Reserved]....................................................................................44
     SECTION 8.10. Expense Account...............................................................................44
     SECTION 8.11. Reserve Account...............................................................................45
     SECTION 8.12. Investment of Funds...........................................................................46

ARTICLE IX Supplemental Indentures...............................................................................47

     SECTION 9.1.  Supplemental Indentures Without Consent of Noteholders........................................47
     SECTION 9.2.  Supplemental Indentures with Consent of Insurer or Noteholders................................48
     SECTION 9.3.  Execution of Supplemental Indentures..........................................................49
     SECTION 9.4.  Effect of Supplemental Indenture..............................................................50
     SECTION 9.5.  Conformity With Trust Indenture Act...........................................................50
     SECTION 9.6.  Reference in Notes to Supplemental Indentures.................................................50

ARTICLE X          Redemption of Notes...........................................................................50

     SECTION 10.1. Redemption....................................................................................50
     SECTION 10.2. Notice........................................................................................51
     SECTION 10.3. Presentation and Surrender of Notes and Payment...............................................51

ARTICLE XI         Certain Matters Regarding the Insurer.........................................................51

     SECTION 11.1. Rights of the Insurer to Exercise Rights of Class A Noteholders...............................51

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     SECTION 11.2.  Indenture Trustee to Act Solely with Consent of the Insurer..................................51
     SECTION 11.3.  Trust Property and Accounts Held for Benefit of the Insurer..................................51
     SECTION 11.4.  Claims Upon the Policy; Policy Payments Account..............................................52
     SECTION 11.5.  Notices to the Insurer.......................................................................53
     SECTION 11.6.  Third-Party Beneficiary......................................................................53
     SECTION 11.7.  Indenture Trustee to Hold the Policy.........................................................53

ARTICLE XII         Miscellaneous................................................................................53

     SECTION 12.1.  Compliance Certificates and Opinions, etc....................................................53
     SECTION 12.2.  Form of Documents Delivered to Indenture Trustee.............................................54
     SECTION 12.3.  Acts of Noteholders..........................................................................54
     SECTION 12.4.  Notices, etc. to Indenture Trustee, Issuer, Insurer and Rating Agencies......................55
     SECTION 12.5.  Notices to Noteholders; Waiver...............................................................56
     SECTION 12.6.  Alternate Payment and Notice Provisions......................................................56
     SECTION 12.7.  Conflict with Trust Indenture Act............................................................57
     SECTION 12.8.  Effect of Headings and Table of Contents.....................................................57
     SECTION 12.9.  Successors and Assigns.......................................................................57
     SECTION 12.10. Separability.................................................................................57
     SECTION 12.11. Benefits of Indenture........................................................................57
     SECTION 12.12. Legal Holidays...............................................................................57
     SECTION 12.13. GOVERNING LAW................................................................................57
     SECTION 12.14. Counterparts.................................................................................58
     SECTION 12.15. Recording of Indenture.......................................................................58
     SECTION 12.16. Trust Obligation.............................................................................58
     SECTION 12.17. No Petition..................................................................................58
     SECTION 12.18. Inspection...................................................................................58
     SECTION 12.19. Limitation of Liability......................................................................59

EXHIBIT A -- Glossary of Defined Terms                                                                             

EXHIBIT B -- Form of Class A Note                                                                                  

EXHIBIT C -- Form of Financial Guaranty Insurance Policy                                                           

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HOMEGOLD HOME EQUITY LOAN TRUST 1999-1

Reconciliation and Tie between the Indenture
 dated as of March 1, 1999 and the
 Trust Indenture Act of 1939, as amended

Trust Indenture Act Section                    Indenture Section          
ss. 310 (a) (1)                             ss. 6.11        
(a) (2)                                  ss. 6.11     
(a) (3)                                  ss. 6.10     
(a) (4)                               Not Applicable  
(b)                                    ss. 6.11   
(c)                                 Not Applicable

311 (a)                                  ss. 6.12     
(b)                                    ss. 6.12   

312 (a)                                  ss. 7.1      
(b)                                    ss. 7.2(b) 
(c)                                    ss. 7.2(c) 

313 (a)                                  ss. 7.4      
(b) (1)                                  ss. 7.4      
(b) (2)                                  ss. 7.4      
     (c)                                    ss. 7.3, ss. 7.4
(d)                                    ss. 7.4    

   314 (a)                                  ss. 3.9, ss. 7.3
(b)                                    ss. 3.6    

       (c) (1)                         ss. 2.8, ss. 8.2(c), ss. 12.1
(c) (2)                                  ss. 12.1     
(c) (3)                                  ss. 12.1     
         (d)                           ss. 2.8, ss. 8.2(c), ss. 12.1
(e)                                    ss. 12.1   
 (f)                                  Not Applicable

      315 (a)                          ss. 6.1, ss. 6.14, ss. 6.16
(b)                                    ss. 6.5    
(c)                                    ss. 6.1    
(d)                                    ss. 6.1    
(e)                                    ss. 5.13   
316 (a) (last sentence)                          ss. 1.1              
(a) (1) (A)                                ss. 5.12       
(a) (1) (B)                                ss. 5.20       
(a) (2)                                Not Applicable 
317 (a) (1)                                ss. 5.3        

   (a) (2)                                  ss. 5.4, ss. 5.5
(b)                                      ss. 3.3  

  318 (a)                                ss. 1.4, ss. 12.7
(c)                                      ss. 12.7 

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            INDENTURE dated as of May 1, 1999, between HOMEGOLD HOME
EQUITY LOAN TRUST 1999-1, a Delaware business trust (the "Issuer"), and FIRST   
UNION NATIONAL BANK, a national banking association, as trustee (the "Indenture 
Trustee").                                                                      

             Each party agrees as follows for the benefit of the other
party, the Insurer and for the equal and ratable benefit of the Holders of the  
Issuer's Class A Home Equity Loan Asset Backed Notes, Series 1999-1             
(collectively, the "Notes"):                                                    

                As security for the payment and performance by the Issuer of
its obligations under this Indenture and the Notes, the Issuer has agreed to    
assign the Collateral (as defined below) to the Indenture Trustee on behalf of  
the Noteholders and the Insurer.                                                

                 Financial Security Assurance, Inc. (the "Insurer") has issued
and delivered a financial guaranty insurance policy, dated the Closing Date (the
"Policy"), pursuant to which the Insurer guarantees the Scheduled Payments (as  
defined below).                                                                 

            As an inducement to the Insurer to issue and deliver the
Policy, the Issuer and the Insurer have executed and delivered the Insurance and
Indemnity Agreement, dated as of May1, 1999 (as amended from time to time, the  
"Insurance Agreement"), among the Insurer, the Issuer, HomeGold, Inc., HomeGold 
Financial, Inc., Emergent Mortgage Holdings Corporation, and Prudential         
Securities Secured Financing Corporation.                                       

           As an additional inducement to the Insurer to issue the
Policy, and as security for the performance by the Issuer of its respective     
obligations hereunder and the other Basic Documents to the Insurer and the      
Indenture Trustee, the Issuer has agreed to grant and assign the Collateral (as 
defined below) to the Indenture Trustee for the benefit of the Issuer Secured   
Parties, as their respective interests may appear.                              

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 GRANTING CLAUSE

            The Issuer hereby Grants to the Indenture Trustee at the
Closing Date, for the benefit of the Issuer Secured Parties all of the Issuer's 
right, title and interest in and to (i) the Mortgage Loans, (ii) any Qualified  
Substitute Mortgage Loans acquired by the Issuer subsequent to the Closing Date 
pursuant to the Sale and Servicing Agreement, (iii) the Mortgage Files delivered
or to be delivered to the Indenture Trustee pursuant to the Sale and Servicing  
Agreement, (iv) all interest and principal received by the Issuer on or in      
respect of the Mortgage Loans and the Qualified Substitute Mortgage Loans       
pursuant to the Sale and Servicing Agreement due after the applicable Cut-off   
Date and all other proceeds received in respect of such Mortgage Loans, (v) the 
Depositor's rights under the Unaffiliated Seller's Agreement, and the Purchase  
Agreement and Assignment (including any security interest created thereby)      
assigned to the Issuer pursuant to the Sale and Servicing Agreement, (vi) the   
Sale and Servicing Agreement, (vii) any and all other property, assets, rights  
and interests included or to be included in the Trust Property, (viii) all cash,
instruments or other property held or required to be deposited in the Collection
Account, the Distribution Account, the Reserve Account and the Expense Account, 
including all investments made with funds in such accounts (but not including   
any income on funds deposited in, or investments made with funds deposited in,  
such accounts, which income shall belong to and be for the account of the       
Servicer), and (ix) all proceeds of the conversion, voluntary or involuntary, of
any of the foregoing into cash or other liquid assets, including, without       
limitation, all insurance proceeds and condemnation awards. Such Grants are     
made, however, in trust, to secure the Notes equally and ratably without        
prejudice, priority or distinction between any Note and any other Note by reason
of difference in time of issuance or otherwise, and for the benefit of the      
Insurer to secure (x) the payment of all amounts due on the Notes in accordance 
with their terms, (y) the payment of all other sums payable under this Indenture
and (z) compliance with the provisions of this Indenture, all as provided in    
this Indenture (the foregoing "Collateral").                                    

                  The foregoing Grant is made in trust to the Indenture Trustee,
for the benefit first, of the Holders of the Notes, and second, for the benefit 
of the Insurer. The Indenture Trustee hereby acknowledges such Grant, accepts   
the trusts under this Indenture in accordance with the provisions of this       
Indenture and agrees to perform its duties required in this Indenture to the    
best of its ability to the end that the interests of such parties, recognizing  
the priorities of their respective interests, may be adequately and effectively 
protected.                                                                      

                 In connection with the Grant set forth above, the Issuer does
hereby deliver to, and deposit with the Indenture Trustee, the Mortgage Files.  

ARTICLE I 

Definitions and Incorporation by Reference

            SECTION 1.1. Definitions. Capitalized terms used but not
otherwise defined herein shall have the meanings ascribed thereto in Exhibit A  
hereto.                                                                         

                  SECTION 1.2. Incorporation by Reference of the Trust Indenture
Act. Whenever this Indenture refers to a provision of the TIA, the provision is 
incorporated by                                                                 

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reference in and made a part of this Indenture. The following TIA terms used in 
this Indenture have the following meanings:                                     

              "Commission" means the Securities and Exchange Commission.

"indenture securities" means the Notes.     

   "indenture security holder" means a Noteholder.

     "indenture to be qualified" means this Indenture.

            "Indenture Trustee" or "institutional trustee" means the
Indenture Trustee.                                                              

           "obligor" on the indenture securities means the Issuer.

                  All other TIA terms used in this Indenture that are defined by
the TIA, or defined by Commission rule have the meaning assigned to them by such
definitions.                                                                    

          SECTION 1.3. Rules of Construction. Unless the context
otherwise requires:                                                             

(i) a term has the meaning assigned to it;  

                 (ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting principles as in
effect from time to time;                                                       

(iii) "or" is not exclusive;                

            (iv) "including" means including without limitation; and

                 (v) words in the singular include the plural and words in the
plural include the singular.                                                    

           SECTION 1.4. Conflict with TIA. If any provision hereof
limits, qualifies or conflicts with a provision of the TIA that is required     
under the TIA to be part of and govern this Indenture, the latter provision     
shall control and all provisions required by the TIA are hereby incorporated by 
reference. If any provision of this Indenture modifies or excludes any provision
of the TIA that may be so modified or excluded, such provisions of the TIA shall
be deemed to apply to this Indenture as so modified or excluded, as the case may
be.                                                                             

ARTICLE II

 The Notes

               SECTION 2.1. Form. The Class A Notes, in each case together
with the Indenture Trustee's certificate of authentication, shall be in         
substantially the form set forth in Exhibits B-1 and B-2, with such appropriate 
insertions, omissions, substitutions and other variations as are required or    
permitted by this Indenture and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may,          
consistently herewith, be determined by the officers executing such Notes, as   
evidenced by their                                                              

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execution of the Notes. Any portion of the text of any Note may be set forth on 
the reverse thereof, with an appropriate reference thereto on the face of the   
Note.                                                                           

                Each Note shall be dated the date of its authentication. The
terms of the Notes set forth in Exhibits B-1 and B-2 are part of the terms of   
this Indenture.                                                                 

            SECTION 2.2. Execution, Authentication and Delivery. The
Notes shall be executed on behalf of the Issuer by any of its Authorized        
Officers. The signature of any such Authorized Officer on the Notes may be      
original or facsimile.                                                          

        Notes bearing the original or facsimile signature of
individuals who were at any time Authorized Officers of the Issuer shall bind   
the Issuer, notwithstanding that such individuals or any of them have ceased to 
hold such offices prior to the authentication and delivery of such Notes or did 
not hold such offices at the date of such Notes.                                

                The Indenture Trustee shall authenticate and deliver Class A
Notes for original issue in an aggregate principal amount of $53,964,000. The   
Class A Notes outstanding at any time may not exceed such amount except as      
provided in Section 2.4.                                                        

                Each Note shall be dated the date of its authentication. The
Notes shall be issuable as registered Notes in the minimum denomination of      
$1,000 and in integral multiples of $1,000 in excess thereof.                   

                 No Note shall be entitled to any benefit under this Indenture
or be valid or obligatory for any purpose, unless there appears attached to such
Note a certificate of authentication substantially in the form provided for     
herein executed by the Indenture Trustee by the manual signature of one of its  
authorized signatories, and such certificate attached to any Note shall be      
conclusive evidence, and the only evidence, that such Note has been duly        
authenticated and delivered hereunder. Subject to Section 2.9 and Section 2.11, 
the Notes shall be Book-Entry Notes.                                            

           SECTION 2.3. Registration; Registration of Transfer and
Exchange. The Issuer shall cause to be kept a register (the "Note Register") in 
which, subject to such reasonable regulations as it may prescribe, the Issuer   
shall provide for the registration of Notes and the registration of transfers of
Notes. The Indenture Trustee shall be "Note Registrar" for the purpose of       
registering Notes and transfers of Notes as herein provided. Upon any           
resignation of any Note Registrar, the Issuer shall promptly appoint a successor
or, if it elects not to make such an appointment, assume the duties of Note     
Registrar.                                                                      

                If a Person other than the Indenture Trustee is appointed by
the Issuer as Note Registrar, the Issuer will give the Indenture Trustee prompt 
written notice of the appointment of such Note Registrar and of the location,   
and any change in the location, of the Note Register, and the Indenture Trustee 
shall have the right to inspect the Note Register at all reasonable times and to
obtain copies thereof. The Indenture Trustee shall have the right to rely upon a
certificate executed on behalf of the Note Registrar by an Authorized Officer   
thereof as to the names and addresses of the Holders of the Notes and the       
principal amounts and number of such Notes.                                     

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                  Upon surrender for registration or transfer of any Note at the
office or agency of the Issuer to be maintained as provided in Section 3.2, and 
if the requirements of Section 8-401(a) of the UCC are met, the Issuer shall    
execute and cause the Indenture Trustee to authenticate one or more new Notes,  
in any authorized denominations, of the same class and a like aggregate         
principal amount. A Noteholder may also obtain from the Indenture Trustee, in   
the name of the designated transferee or transferees one or more new Notes, in  
any authorized denominations, of the same Class and a like aggregate principal  
amount. Such requirements shall not be deemed to create a duty on the part of   
the Indenture Trustee to monitor the compliance by the Issuer with Section 8-401
of the UCC.                                                                     

                 At the option of the Holder, Notes may be exchanged for other
Notes in any authorized denominations, of the same Class and a like aggregate   
principal amount, upon surrender of the Notes to be exchanged at such office or 
agency. Whenever any Notes are so surrendered for exchange, and if the          
requirements of Section 8-401(a) of the UCC are met, the Issuer shall execute   
and upon its request the Indenture Trustee shall authenticate the Notes which   
the Noteholder making the exchange is entitled to receive. Such requirements    
shall not be deemed to create a duty on the part the Indenture Trustee to       
monitor the compliance by the Issuer with Section 8-401 of the UCC.             

                  All Notes issued upon any registration of transfer or exchange
of Notes shall be the valid obligations of the Issuer, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.                                 

           Every Note presented or surrendered for registration of
transfer or exchange shall be (i) duly endorsed by, or be accompanied by a      
written instrument of transfer in the form attached to Exhibits B-1 and B-2,    
duly executed by, the Holder thereof or such Holder's attorney duly authorized  
in writing, with such signature guaranteed by an "eligible guarantor            
institution" meeting the requirements of the Note Registrar all in accordance   
with the Exchange Act, and (ii) accompanied by such other documents as the Note 
Registrar may require.                                                          

       No service charge shall be made to a Holder for any
registration of transfer or exchange of Notes, but the Note Registrar may       
require payment of a sum sufficient to cover any tax or other governmental      
charge that may be imposed in connection with any registration of transfer or   
exchange of Notes, other than exchanges pursuant to Section 2.4 not involving   
any transfer.                                                                   

              Any Noteholder using the assets of (i) an employee benefit
plan (as defined in Section 3(3) of ERISA that is subject to the provisions of  
Title I of ERISA, (ii) a plan described in Section 4975(e)(1) of the Internal   
Revenue Code of 1986, as amended, or (iii) any entity whose underlying assets   
include plan assets by reason of a plan's investment in the entity to purchase  
the Notes, or to whom the Notes are transferred, will be deemed to have         
represented that the acquisition and continued holding of the Notes will be     
covered by a U.S. Department of Labor Class Exemption.                          

               SECTION 2.4. Mutilated, Destroyed, Lost or Stolen Notes. If
(i) any mutilated Note is surrendered to the Note Registrar, or the Note        
Registrar receives evidence to its satisfaction of the destruction, loss or     
theft of any Note, and (ii) there is delivered to the                           

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Indenture Trustee and the Insurer such security or indemnity as may be required 
by it to hold the Issuer, the Indenture Trustee and the Insurer harmless, then, 
in the absence of notice to the Issuer, the Note Registrar or the Indenture     
Trustee that such Note has been acquired by a bona fide purchaser or protected  
purchaser (within the meaning of Section 8-302 of the UCC), and provided that   
the requirements of Section 8-405 of the UCC are met, the Issuer shall execute  
and upon its request the Indenture Trustee shall authenticate and deliver, in   
exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note, a
replacement Note (such requirement shall not be deemed to create a duty in the  
Indenture Trustee to monitor the compliance by the Issuer with Section 8-405);  
provided, however, that if any such destroyed, lost or stolen Note, but not a   
mutilated Note, shall have become or within seven days shall be due and payable,
or shall have been called for redemption, the Issuer may, instead of issuing a  
replacement Note, direct the Indenture Trustee, in writing, to pay such         
destroyed, lost or stolen Note when so due or payable or upon the Redemption    
Date without surrender thereof. If, after the delivery of such replacement Note 
or payment of a destroyed, lost or stolen Note pursuant to the proviso to the   
preceding sentence, a protected purchaser of the original Note in lieu of which 
such replacement Note was issued presents for payment such original Note, the   
Issuer, the Indenture Trustee and the Insurer shall be entitled to recover such 
replacement Note (or such payment) from the Person to whom it was delivered or  
any Person taking such replacement Note from such Person to whom such           
replacement Note was delivered or any assignee of such Person, except a         
protected purchaser, and shall be entitled to recover upon the security or      
indemnity provided therefor to the extent of any loss, damage, cost or expense  
incurred by the Issuer, the Insurer or the Indenture Trustee in connection      
therewith.                                                                      

                 Upon the issuance of any replacement Note under this Section,
the Issuer may require the payment by the Holder of such Note of a sum          
sufficient to cover any tax or other governmental charge that may be imposed in 
relation thereto and any other reasonable expenses (including the fees and      
expenses of the Indenture Trustee) connected therewith.                         

             Every replacement Note issued pursuant to this Section in
replacement of any mutilated, destroyed, lost or stolen Note shall constitute an
original additional contractual obligation of the Issuer, whether or not the    
mutilated, destroyed, lost or stolen Note shall be at any time enforceable by   
anyone, and shall be entitled to all the benefits of this Indenture equally and 
proportionately with any and all other Notes duly issued hereunder.             

          The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to   
the replacement or payment of mutilated, destroyed, lost or stolen Notes.       

                SECTION 2.5. Persons Deemed Owners. Prior to due presentment
for registration of transfer of any Note, the Issuer, the Indenture Trustee and 
the Insurer and any agent of the Issuer, the Indenture Trustee and the Insurer  
may treat the Person in whose name any Note is registered (as of the Record     
Date) as the owner of such Note for the purpose of receiving payments of        
principal of and interest, if any, on such Note and for all other purposes      
whatsoever, whether or not such Note be overdue, and none of the Issuer, the    
Insurer, the Indenture Trustee nor any agent of the Issuer, the Insurer or the  
Indenture Trustee shall be affected by notice to the contrary.                  

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               SECTION 2.6. Payment of Principal and Interest (a). (a) The
unpaid principal of the Notes of each Class shall accrue interest as provided   
herein, which (except for Shortfall Interest Deferred Amounts or Accrued        
Shortfall Interest Carry Forward Amounts, which shall be due and payable only to
the extent funds are available therefor as provided herein) shall be due and    
payable on each Payment Date prior to the Final Payment Date thereof and        
(without regard to the availability of funds for the payment of Shortfall       
Interest Deferred Amounts or Accrued Shortfall Interest Carry Forward Amounts)  
on such Final Payment Date. The unpaid principal of the Notes of each Class     
shall be due and payable (to the extent of funds available therefor as provided 
herein) on each Payment Date as provided in Section 8.3 and (regardless of the  
availability of sufficient funds therefor) on the Final Payment Date for such   
Class. Payment of interest and principal on any Note shall be made as provided  
in Section 8.3(d).                                                              

(b) [Intentionally Omitted.]                

(c) [Intentionally Omitted.]                

                 (d) Promptly following the date on which all principal of and
interest on the Notes has been paid in full and the Notes have been surrendered 
to the Indenture Trustee, the Indenture Trustee shall, upon written notice from 
the Servicer of the amounts, if any, that the Insurer has paid in respect of the
Notes under the Policy or otherwise which has not been reimbursed to it, deliver
such surrendered Notes to the Insurer to the extent not previously cancelled or 
destroyed.                                                                      

             SECTION 2.7. Cancellation. Subject to Section 2.6(d), all
Notes surrendered for payment, registration of transfer, exchange or redemption 
shall, if surrendered to any Person other than the Indenture Trustee, be        
delivered to the Indenture Trustee and shall be promptly canceled by the        
Indenture Trustee. Subject to Section 2.6(d), the Issuer may at any time deliver
to the Indenture Trustee for cancellation any Notes previously authenticated and
delivered hereunder which the Issuer may have acquired in any manner whatsoever,
and all Notes so delivered shall be promptly canceled by the Indenture Trustee. 
No Notes shall be authenticated in lieu of or in exchange for any Notes canceled
as provided in this Section, except as expressly permitted by this Indenture.   
Subject to Section 2.6(d), all canceled Notes may be held or disposed of by the 
Indenture Trustee in accordance with its standard retention or disposal policy  
as in effect at the time unless the Issuer shall direct by an Issuer Order that 
they be destroyed or returned to it; provided that such Issuer Order is timely  
and the Notes have not been previously disposed of by the Indenture Trustee.    

             SECTION 2.8. Release of Collateral. The Indenture Trustee
shall (i) release any portion of the Trust Property relating to a Class from the
lien created by this Indenture in accordance with the provisions of Section     
10.02(b) of the Sale and Servicing Agreement and (ii) on or after the           
Termination Date, release any remaining portion of the Trust Property relating  
to such Class from the lien created by this Indenture, in each case upon receipt
of an Issuer Request accompanied by an Officer's Certificate, an Opinion of     
Counsel and (if required by the TIA) Independent Certificates in accordance with
TIA ss.ss. 314(c) and 314(d)(1) meeting the applicable requirements of Section  
10.02.                                                                          

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           SECTION 2.9. Book-Entry Notes. The Notes, upon original
issuance, will be issued in the form of typewritten Notes representing the      
Book-Entry Notes, to be delivered to the Depository or its nominee by, or on    
behalf of, the Issuer. Such Notes shall initially be registered on the Note     
Register in the name of Cede & Co., the nominee of the Depository, and no Note  
Owner will receive a Definitive Note representing such Note Owner's interest in 
such Note, except as provided in Section 2.11. Unless and until definitive,     
fully registered Notes (the "Definitive Notes") have been issued to Note Owners 
pursuant to Section 2.11:                                                       

                 (i) the provisions of this Section shall be in full force and
effect;                                                                         

              (ii) the Note Registrar and the Indenture Trustee shall be
entitled to deal with the Depository for all purposes of this Indenture         
(including the payment of principal of and interest on the Notes and the giving 
of instructions or directions hereunder) as the sole Holder of the Notes, and   
shall have no obligation to the Note Owners;                                    

           (iii) to the extent that the provisions of this Section
conflict with any other provisions of this Indenture, the provisions of this    
Section shall control;                                                          

                  (iv) the rights of Note Owners shall be exercised only through
the Depository and shall be limited to those established by law and agreements  
between such Note Owners and the Depository and/or the Depository Participants. 
Unless and until Definitive Notes are issued pursuant to Section 2.11, the      
initial Depository will make book-entry transfers among the Depository          
Participants and receive and transmit payments of principal of and interest on  
the Notes to such Depository Participants;                                      

                 (v) whenever this Indenture requires or permits actions to be
taken based upon instructions or directions of Holders of Notes evidencing a    
specified percentage of the Outstanding Amount of the Notes, the Depository     
shall be deemed to represent such percentage only to the extent that it has     
received instructions to such effect from Note Owners and/or Depository         
Participants owning or representing, respectively, such required percentage of  
the beneficial interest in the Notes and has delivered such instructions to the 
Indenture Trustee; and                                                          

              (vi) Note Owners may receive copies of any reports sent to
Noteholders pursuant to this Indenture, upon written request, together with a   
certification that they are Note Owners and payment of reproduction and postage 
expenses associated with the distribution of such reports, from the Indenture   
Trustee at the Corporate Trust Office.                                          

             SECTION 2.10. Notices to Depository. Whenever a notice or
other communication to the Noteholders is required under this Indenture, unless 
and until Definitive Notes shall have been issued to Note Owners pursuant to    
Section 2.11, the Indenture Trustee shall give all such notices and             
communications specified herein to be given to Holders of the Notes to the      
Depository, and shall have no obligation to the Note Owners.                    

               SECTION 2.11. Definitive Notes. If (i) the Depositor or the
Depository advises the Indenture Trustee in writing that the Depository is no   
longer willing or able to properly discharge its responsibilities with respect  
to the Notes, and the Servicer is unable to locate a qualified successor, (ii)  
the Depositor at its option advises the Indenture Trustee in writing that it    

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elects to terminate the book-entry system through the Depository or (iii) after 
the occurrence of a Servicer Event of Default or Event of Default, Holders of   
Notes evidencing not less than 51% of the Outstanding Amount of the Notes advise
the Indenture Trustee through the Depository in writing that the continuation of
a book entry system through the Depository is no longer in the best interests of
the Note Owners, then the Indenture Trustee shall notify all Depository         
Participants and Note Owners of the occurrence of any such event and of the     
availability of Definitive Notes to Note Owners requesting the same. Upon       
surrender to the Indenture Trustee of the typewritten Note or Notes representing
the Book-Entry Notes by the Depository, accompanied by registration             
instructions, the Issuer shall execute and the Indenture Trustee shall          
authenticate Definitive Notes in accordance with the instructions of the        
Depository. None of the Issuer, the Note Registrar or the Indenture Trustee     
shall be liable for any delay in delivery of such instructions and may          
conclusively rely on, and shall be protected in relying on, such instructions.  
Upon the issuance of Definitive Notes, the Indenture Trustee shall recognize the
Holders of the Definitive Notes as Noteholders.                                 

 ARTICLE III

 Covenants

              SECTION 3.1. Payment of Principal and Interest. The Issuer
will duly and punctually pay the principal of and interest on the Notes in      
accordance with the terms of the Notes and this Indenture. Without limiting the 
foregoing, the Issuer will cause to be delivered to the Indenture Trustee all   
amounts on deposit in the Collection Account when and as required by the Sale   
and Servicing Agreement. Amounts properly withheld under the Code by any Person 
from a payment to any Noteholder of interest and/or principal shall be          
considered as having been paid by the Issuer to such Noteholder for all purposes
of this Indenture.                                                              

                 SECTION 3.2. Maintenance of Office or Agency. The Issuer will
maintain in Charlotte, North Carolina, an office or agency where Notes may be   
surrendered for registration, transfer or exchange of the Notes, and where      
notices and demands to or upon the Issuer in respect of the Notes and this      
Indenture may be served. The Issuer hereby initially appoints the Indenture     
Trustee to serve as its agent for the foregoing purposes. The Issuer will give  
prompt written notice to the Indenture Trustee of the location, and of any      
change in the location, of any such office or agency. If at any time the Issuer 
shall fail to maintain any such office or agency or shall fail to furnish the   
Indenture Trustee with the address thereof, such surrenders, notices and demands
may be made or served at the Corporate Trust Office, and the Issuer hereby      
appoints the Indenture Trustee as its agent to receive all such surrenders,     
notices and demands.                                                            

            SECTION 3.3. Money for Payments to Be Held in Trust. The
Issuer will cause each Note Paying Agent other than the Indenture Trustee to    
execute and deliver to the Indenture Trustee and the Insurer an instrument in   
which such Note Paying Agent shall agree with the Indenture Trustee (and if the 
Indenture Trustee acts as Note Paying Agent, it hereby so agrees), subject to   
the provisions of this Section, that such Note Paying Agent will:               

               (i) hold all sums held by it for the payment of amounts due
with respect to the Notes in trust for the benefit of the Persons entitled      
thereto until such sums shall be paid                                           

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to such Persons or otherwise disposed of as herein provided and pay such sums to
such Persons as herein provided;                                                

                  (ii) give the Indenture Trustee and the Insurer written notice
of any default by the Issuer (or any other obligor upon the Notes) of which it  
has actual knowledge in the making of any payment required to be made with      
respect to the Notes;                                                           

                 (iii) at any time during the continuance of any such default,
upon the written request of the Indenture Trustee, forthwith pay to the         
Indenture Trustee all sums so held in trust by such Note Paying Agent;          

                (iv) immediately resign as a Note Paying Agent and forthwith
pay to the Indenture Trustee all sums held by it in trust for the payment of    
Notes if at any time it ceases to meet the standards required to be met by a    
Note Paying Agent at the time of its appointment; and                           

                (v) comply with all requirements of the Code with respect to
the withholding from any payments made by it on any Notes of any applicable     
withholding taxes imposed thereon and with respect to any applicable reporting  
requirements in connection therewith.                                           

                The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by Issuer
Order direct any Note Paying Agent to pay to the Indenture Trustee all sums held
in trust by such Note Paying Agent, such sums to be held by the Indenture       
Trustee upon the same trusts as those upon which the sums were held by such Note
Paying Agent; and upon such a payment by any Note Paying Agent to the Indenture 
Trustee, such Note Paying Agent shall be released from all further liability    
with respect to such money.                                                     

             Subject to applicable laws with respect to the escheat of
funds, any money held by the Indenture Trustee or any Note Paying Agent in trust
for the payment of any amount due with respect to any Note and remaining        
unclaimed for two years after such amount has become due and payable shall be   
discharged from such trust and be paid to the Issuer on Issuer Request, and the 
Holder of such Note shall thereafter, as an unsecured general creditor, look    
only to the Issuer for payment thereof (but only to the extent of the amounts so
paid to the Issuer), and all liability of the Indenture Trustee or such Note    
Paying Agent with respect to such trust money shall thereupon cease.            

               SECTION 3.4. Existence. The Issuer will keep in full effect
its existence, rights and franchises as a business trust under the laws of the  
State of Delaware (unless it becomes, or any successor Issuer hereunder is or   
becomes, organized under the laws of any other state or of the United States of 
America, in which case the Issuer will keep in full effect its existence, rights
and franchises under the laws of such other jurisdiction) and will obtain and   
preserve its qualification to do business in each jurisdiction in which such    
qualification is or shall be necessary to protect the validity and              
enforceability of this Indenture, the Trust Property, the Notes, and each other 
instrument or agreement included in the Trust Property.                         

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                 SECTION 3.5. Protection of Trust Property. The Issuer intends
the security interest granted pursuant to this Indenture in favor of the Issuer 
Secured Parties to be prior to all other liens in respect of the Trust Property,
and the Issuer shall take all actions necessary to discharge and release the    
Warehouse Liens upon the acquisition by the Trust of the related Mortgage Loans 
and thereafter to obtain and maintain, in favor of the Indenture Trustee, for   
the benefit of the Issuer Secured Parties, a first lien on and a first priority,
perfected security interest in the Trust Property. The Issuer will from time to 
time prepare (or shall cause to be prepared), execute and deliver all such      
supplements and amendments hereto and all such financing statements,            
continuation statements, instruments of further assurance and other instruments,
and will take such other action necessary or advisable to:                      

              (i) Grant more effectively all or any portion of the Trust
Property;                                                                       

                 (ii) maintain or preserve the lien and security interest (and
the priority thereof) in favor of the Indenture Trustee for the benefit of the  
Issuer Secured Parties created by this Indenture or carry out more effectively  
the purposes hereof;                                                            

               (iii) perfect, publish notice of or protect the validity of
any Grant made or to be made by this Indenture;                                 

(iv) enforce any of the Collateral;         

               (v) preserve and defend title to the Trust Property and the
rights of the Indenture Trustee in such Trust Property against the claims of all
persons and parties; and                                                        

                 (vi) pay all taxes or assessments levied or assessed upon the
Trust Property when due.                                                        

                The Issuer hereby designates the Indenture Trustee its agent
and attorney-in-fact to execute any financing statement, continuation statement 
or other instrument required by the Indenture Trustee pursuant to this Section; 
provided that, such designation shall not be deemed to create a duty in the     
Indenture Trustee or the Indenture Trustee to monitor the compliance of the     
Issuer with respect to its duties under this Section 3.5 or the adequacy of any 
financing statement, continuation statement or other instrument prepared by the 
Issuer.                                                                         

          SECTION 3.6. Opinions as to Trust Property. (a) On the
Closing Date, the Issuer shall furnish to the Indenture Trustee and the Insurer 
an Opinion of Counsel stating that, in the opinion of such counsel, such actions
have been taken with respect to the recording and filing of this Indenture, any 
indentures supplemental hereto, and any other requisite documents, and with     
respect to the execution and filing of any financing statements and continuation
statements, as are necessary to perfect and make effective the first priority   
lien and security interest in favor of the Indenture Trustee, for the benefit of
the Issuer Secured Parties, created by this Indenture.                          

                 (b) Within 90 days after the beginning of each calendar year,
beginning with the first calendar year beginning more than six months after the 
Closing Date, the Issuer shall furnish to the Indenture Trustee and the Insurer,
an Opinion of Counsel either stating that, in the opinion of such counsel, such 
actions have been taken with respect to the recording, filing, re-recording and 
refiling of this Indenture, any indentures supplemental hereto and any other    
requisite                                                                       

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documents and with respect to the execution and filing of any financing         
statements and continuation statements as are necessary to maintain the lien and
security interest created by this Indenture and reciting the details of such    
action or stating that in the opinion of such counsel, no such action is        
necessary to maintain such lien and security interest. Such Opinion of Counsel  
shall also describe the recording, filing, re-recording and refiling of this    
Indenture, any indentures supplemental hereto and any other requisite documents 
and the execution and filing of any financing statements and continuation       
statements that will, in the opinion of such counsel, be required to maintain   
the lien and security interest of this Indenture.                               

                  SECTION 3.7. Performance of Obligations; Servicing of Mortgage
Loans. (a) The Issuer will not take any action and will use its best            
efforts not to permit any action to be taken by others that would release any   
Person from any of such Person's material covenants or obligations under any    
instrument or agreement included in the Trust Property or that would result in  
the amendment, hypothecation, subordination, termination or discharge of, or    
impair the validity or effectiveness of, any such instrument or agreement,      
except as ordered by any bankruptcy or other court or as expressly provided or  
permitted in this Indenture, the Basic Documents or such other instrument or    
agreement.                                                                      

                (b) The Issuer may contract with other Persons acceptable to
the Insurer to assist it in performing its duties under this Indenture, and any 
performance of such duties by a Person identified to the Indenture Trustee and  
the Insurer in an Officer's Certificate of the Issuer shall be deemed to be     
action taken by the Issuer. Initially, the Issuer has contracted with the       
Servicer to assist the Issuer in performing its duties under this Indenture.    

                 (c) The Issuer will punctually perform and observe all of its
obligations and agreements contained in this Indenture, the Basic Documents and 
in the instruments and agreements included in the Trust Property, including, but
not limited, to preparing (or causing to be prepared) and filing (or causing to 
be filed) all UCC financing statements and continuation statements required to  
be filed by the terms of this Indenture and the Sale and Servicing Agreement in 
accordance with and within the time periods provided for herein and therein.    
Except as otherwise expressly provided therein, the Issuer shall not waive,     
amend, modify, supplement or terminate any Basic Document or any provision      
thereof without the consent of the Indenture Trustee and the Insurer (or, if an 
Insurer Default has occurred and is continuing, and such waiver, amendment,     
modification, supplement or termination would adversely affect the interests of 
the Noteholders, then of the Holders of a majority of the Outstanding Amount of 
the Notes). The Indenture Trustee may determine whether or not any Notes would  
be adversely affected by any such waiver, amendment, modification, supplement or
termination upon receipt of written confirmation from the Rating Agencies that  
such action would not adversely affect the then current ratings on the Notes.   

                (d) If a Responsible Officer of the Owner Trustee shall have
actual knowledge of the occurrence of a Servicer Event of Default under the Sale
and Servicing Agreement, the Issuer shall promptly notify the Indenture Trustee,
the Insurer and the Rating Agencies thereof in accordance with Section 12.4, and
shall specify in such notice the action, if any, being taken or to be taken by  
the Issuer or other Persons.                                                    

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       (e) The Issuer agrees that it will not waive timely
performance or observance by the Servicer or the Unaffiliated Seller of their   
respective duties under the Basic Documents (x) without the prior consent of the
Insurer or (y) if the effect thereof would adversely affect the Holders of the  
Notes.                                                                          

             SECTION 3.8. Negative Covenants. So long as any Notes are
Outstanding, the Issuer shall not:                                              

          (i) except as permitted by this Indenture or the Basic
Documents, sell, transfer, exchange or otherwise dispose of any of the          
properties or assets of the Issuer, including those included in the Trust       
Property, without the consent of the Insurer;                                   

            (ii) claim any credit on, or make any deduction from the
principal or interest payable in respect of, the Notes (other than amounts      
properly withheld from such payments under the Code) or assert any claim against
any present or former Noteholder by reason of the payment of the taxes levied or
assessed upon any part of the Trust Property; or                                

          (iii) (A) permit the validity or effectiveness of this
Indenture to be impaired, or permit the lien in favor of the Indenture Trustee  
created by this Indenture to be amended, hypothecated, subordinated, terminated 
or discharged, or permit any Person to be released from any covenants or        
obligations with respect to the Notes under this Indenture except as may be     
expressly permitted hereby, (B) permit any lien, charge, excise, claim, security
interest, mortgage or other encumbrance (other than the lien of this Indenture) 
to be created on or extend to or otherwise arise upon or burden the Trust       
Property or any part thereof or any interest therein or the proceeds thereof    
(other than (i) tax liens, mechanics' liens and other liens that arise by       
operation of law, in each case on a Mortgaged Property and arising solely as a  
result of an action or omission of the related Mortgagor and (ii) the Warehouse 
Liens provided that such Warehouse Liens are discharged and released as provided
in Section 3.12), (C) permit the lien of this Indenture not to constitute a     
valid first priority (other than with respect to any such tax, mechanics' or    
other lien or such Warehouse Liens) security interest in the Trust Property or  
(D) amend, modify or fail to comply with the provisions of the Basic Documents  
without the prior written consent of the Insurer.                               

              SECTION 3.9. Annual Statement as to Compliance. The Issuer
will deliver to the Indenture Trustee and the Insurer, within 90 days after the 
end of each fiscal year of the Issuer (commencing with the fiscal year ended    
December 31, 1999), and otherwise in compliance with the requirements of TIA    
Section 314(a)(4) an Officer's Certificate stating, as to the Authorized Officer
signing such Officer's Certificate, that                                        

                 (i) a review of the activities of the Issuer during such year
and of performance under this Indenture has been made under such Authorized     
Officer's supervision; and                                                      

                  (ii) to the best of such Authorized Officer's knowledge, based
on such review, the Issuer has complied with all conditions and covenants under 
this Indenture throughout                                                       

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such year, or, if there has been a default in the compliance of any such        
condition or covenant, specifying each such default known to such Authorized    
Officer and the nature and status thereof.                                      

                SECTION 3.10. Issuer May Not Consolidate. The Issuer may not
consolidate or merge with or into any other Person.                             

                SECTION 3.11. No Other Business. The Issuer shall not engage
in any business other than as contemplated by this Indenture and the Basic      
Documents and activities incidental thereto.                                    

                 SECTION 3.12. No Borrowing; Use of Proceeds. The Issuer shall
not issue, incur, assume, guarantee or otherwise become liable, directly or     
indirectly, for any Indebtedness except for (i) the Notes, (ii) obligations     
owing from time to time to the Insurer under the Insurance Agreement and (iii)  
any other Indebtedness permitted by or arising under the Basic Documents. The   
proceeds of the Notes shall be used exclusively to repay the Warehouse Loans and
obtain the release and discharge of the Warehouse Liens, to make any other      
payments required by the terms of any of the Basic Documents and to pay the     
Issuer's organizational, transactional and start-up expenses.                   

                SECTION 3.13. Servicer's Obligations. The Issuer shall cause
the Servicer to comply with its obligations under the Sale and Servicing        
Agreement.                                                                      

       SECTION 3.14. Guarantees, Loans, Advances and Other
Liabilities.  Except as contemplated by the Sale and Servicing Agreement, this  
Indenture or the Basic Documents, the Issuer shall not make any loan or advance 
or credit to, or guarantee (directly or indirectly or by an instrument having   
the effect of assuring another's payment or performance on any obligation or    
capability of so doing or otherwise), endorse or otherwise become continently   
liable, directly or indirectly, in connection with the obligations, stocks or   
dividends of, or own, purchase, repurchase or acquire (or agree continently to  
do so) any stock, obligations, assets or securities of, or any other interest   
in, or make any capital contribution to, any other Person.                      

            SECTION 3.15. Capital Expenditures. Except as and to the
extent authorized by the Basic Documents, the Issuer shall not make any         
expenditure (by long-term or operating lease or otherwise) for capital assets   
(either realty or personally).                                                  

               SECTION 3.16. Compliance with Laws. The Issuer shall comply
with the requirements of all applicable laws, the noncompliance with which      
would, individually or in the aggregate, materially and adversely affect the    
ability of the Issuer to perform its obligations under the Notes, this Indenture
or any Basic Document.                                                          

            SECTION 3.17. Restricted Payments. The Issuer shall not,
directly or indirectly, (i) pay any dividend or make any distribution (by       
reduction of capital or otherwise), whether in cash, property, securities or a  
combination thereof, to the Owner Trustee or any owner of a beneficial interest 
in the Issuer or otherwise with respect to any ownership or equity interest or  
security in or of the Issuer or to the Servicer, (ii) redeem, purchase, retire  
or otherwise acquire for value any such ownership or equity interest or security
or (iii) set aside or otherwise segregate any amounts for any such purpose;     
provided, however, that the Issuer may make, or                                 

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cause to be made, distributions to the Servicer, the Owner Trustee, the         
Indenture Trustee, the Insurer and the Noteholders as permitted or contemplated 
by, and to the extent funds are available for such purpose under, the Sale and  
Servicing Agreement, this Indenture or the Trust Agreement.                     

                 SECTION 3.18. Notice of Events of Default and Servicer Events
of Default . Upon a Responsible Officer of the Owner Trustee having actual      
knowledge thereof, the Issuer agrees to give the Indenture Trustee, the Insurer 
and the Rating Agencies prompt written notice of each Event of Default hereunder
or Servicer Event of Default under the Sale and Servicing Agreement.            

               SECTION 3.19. Further Instruments and Acts. Upon request of
the Indenture Trustee or the Insurer, the Issuer will execute and deliver such  
further instruments and do such further acts as may be reasonably necessary or  
proper to carry out more effectively the purpose of this Indenture.             

                SECTION 3.20. Amendments of Sale and Servicing Agreement and
Trust Agreement. The Issuer shall not agree to any amendment to Section 12.01   
of the Sale and Servicing Agreement or Section 16.1 of the Trust Agreement to   
eliminate the requirements thereunder that the Indenture Trustee, the Insurer or
the Holders of the Notes, as the case may be, consent to amendments thereto as  
provided therein.                                                               

              SECTION 3.21. Income Tax Characterization. For purposes of
federal income, state and local income and franchise and any other income taxes,
the Issuer will treat the Notes as indebtedness and hereby instructs the        
Indenture Trustee to treat the Notes as indebtedness for federal and state tax  
reporting purposes.                                                             

SECTION 3.22. [Reserved].                   

ARTICLE IV

Satisfaction and Discharge

              SECTION 4.1. Satisfaction and Discharge of Indenture. Upon
payment in full of the Notes and all amounts due to the Insurer under the       
Insurance Agreement, this Indenture shall cease to be of further effect with    
respect to the Notes except as to (i) the rights, obligations and immunities of 
the Indenture Trustee hereunder (including the rights of the Indenture Trustee  
under Section 6.7 and the obligations of the Indenture Trustee under Section    
4.2) and (ii) the rights of Noteholders as beneficiaries hereof with respect to 
the property so deposited with the Indenture Trustee payable to all or any of   
them, and the Indenture Trustee, on demand of and at the expense of the Issuer, 
shall execute proper instruments acknowledging satisfaction and discharge of    
this Indenture with respect to the Notes, when                                  

(A) either                                  

                (1) all Notes theretofore authenticated and delivered (other
       than (i) Notes that have been destroyed, lost or stolen and that have
     been replaced or paid as provided in Section 2.4 and (ii) Notes for
which money in payment of which has theretofore been          

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   deposited in trust or segregated and held in trust and thereafter
    repaid to the Issuer or discharged from such trust, as provided in
Section 3.3) have been delivered to the Indenture Trustee for 
     cancellation and the Policy has terminated and been returned to the
         Insurer for cancellation and all amounts owing to the Insurer have been
paid in full; or                                              

              (2)   all Notes not theretofore delivered to the Indenture
Trustee for cancellation        

(i)   have become due and payable,          

                (ii)  will become due and payable at the Final Maturity Date
within one year, or             

               (iii) are to be called for redemption within one year under
                      arrangements satisfactory to the Indenture Trustee for
                   the giving of notice of redemption by the Indenture
                       Trustee in the name, and at the expense, of the Issuer,

and in the case of (i), (ii) or (iii) above                   

             (B) the Issuer, has irrevocably deposited or caused to be
irrevocably deposited with the Indenture Trustee cash or direct obligations of  
or obligations guaranteed by the United States of America (which will mature    
prior to the date such amounts are payable), in trust for such purpose, in an   
amount sufficient to pay and discharge the entire indebtedness on such Notes not
theretofore delivered to the Indenture Trustee for cancellation when due on the 
Final Maturity Date or the Redemption Date (if Notes shall have been called for 
redemption pursuant to Section 10.1), as the case may be;                       

            (C) the Issuer has paid or caused to be paid all Insurer
Issuer Secured Obligations and all Indenture Trustee Issuer Secured Obligations;
and                                                                             

                 (D) the Issuer has delivered to the Indenture Trustee and the
Insurer an Officer's Certificate, an Opinion of Counsel and if required by the  
TIA, the Indenture Trustee or the Insurer an Independent Certificate from a firm
of certified public accountants, each meeting the applicable requirements of    
Section 12.1 and each stating that all conditions precedent herein provided     
relating to the satisfaction and discharge of this Indenture have been complied 
with.                                                                           

                 SECTION 4.2. Application of Trust Money. All monies deposited
with the Indenture Trustee pursuant to Section 4.1 hereof shall be held in trust
and applied by it, in accordance with the provisions of the Notes and this      
Indenture, to the payment, either directly or through any Note Paying Agent, as 
the Indenture Trustee may determine, to the Holders of the particular Notes for 
the payment or redemption of which such monies have been deposited with the     
Indenture Trustee, of all sums due and to become due thereon for principal and  
interest.                                                                       

               SECTION 4.3. Repayment of Monies Held by Note Paying Agent.
In connection with the satisfaction and discharge of this Indenture with respect
to the Notes, all monies then held by any Note Paying Agent other than the      
Indenture Trustee under the provisions of this Indenture with respect to such   
Notes shall, upon demand of the Issuer, be paid to the Indenture Trustee to be  
held and applied according to Section 3.3 and thereupon such Note Paying Agent  
shall be released from all further liability with respect to such monies.       

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 ARTICLE V

Remedies

           SECTION 5.1. Events of Default. "Event of Default" with
respect to each Class of Notes issued hereunder, means any one of the following 
events (whatever the reason for such Event of Default and whether it shall be   
voluntary or involuntary or be affected by operation of law or pursuant to any  
judgment, decree or order of any court or any order, rule or regulation of any  
administrative or governmental body):                                           

           (a) (i) default in the payment of any interest on or in
respect of any Note of such Class when due and payable (as provided in Section  
2.6(a)), which default shall continue for a period of five days, or (ii) the    
failure to apply funds which are available for payment in accordance with the   
priority of distribution set forth in Article VIII hereof, which failure shall  
continue for a period of five days, or (iii) default in the payment of principal
due on any such Class of Notes, on the Final Distribution Date thereof; or      

                 (b) with respect to the related Class of Notes the occurrence
and continuance of an Insurer Default; or                                       

                (c) the entry by a court having jurisdiction in the premises
of (i) a decree or order for relief in respect of the Issuer in an involuntary  
case or proceeding under any applicable federal or state bankruptcy, insolvency,
reorganization, or other similar law or (ii) a decree or order adjudging the    
Issuer a bankrupt or insolvent, or approving as properly filed a petition       
seeking reorganization, arrangement, adjustment, or composition of or in respect
of the Issuer under any applicable federal or state law, or appointing a        
custodian, receiver, liquidator, assignee, trustee, sequestrator, or other      
similar official of the Issuer or of any substantial part of its property, or   
ordering the winding up or liquidation of its affairs, and the continuance of   
any such decree or order for relief or any such other decree or order unstayed  
and in effect for a period of 60 consecutive days; or                           

             (d) the commencement by the Issuer of a voluntary case or
proceeding under any applicable federal or state bankruptcy, insolvency,        
reorganization, or other similar law or of any other case or proceeding to be   
adjudicated a bankrupt or insolvent, or the consent by it to the entry of a     
decree or order for relief in respect of the Issuer in an involuntary case or   
proceeding under any applicable federal or state bankruptcy, insolvency,        
reorganization, or other similar law or to the commencement of any bankruptcy or
insolvency case or proceeding against it, or the filing by it of a petition or  
answer or consent seeking reorganization or relief under any applicable federal 
or state law, or the consent by it to the filing of such petition or to the     
appointment of or taking possession by a custodian, receiver, liquidator,       
assignee, trustee, sequestrator, or similar official of the Issuer or of any    
substantial part of its property, or the making by it of an assignment for the  
benefit of creditors, or the Issuer's failure to pay its debts generally as they
become due, or the taking of corporate action by the Issuer in furtherance of   
any such action.                                                                

         SECTION 5.2. Acceleration of Maturity; Rescission and
Annulment. (a) If an Event of Default occurs and is continuing, then and in     
every such case, the Insurer may (or, if an                                     

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Insurer Default has occurred and is continuing, the Indenture Trustee may, and  
if so directed by the Holders of Notes evidencing to at least 66-2/3% of the    
Outstanding Amount of the related Class of Notes shall) declare the unpaid      
principal amount of all such Notes to be due and payable immediately, by a      
notice in writing to the Issuer, the Servicer and the Insurer, and upon any such
declaration such principal amount shall become immediately due and payable      
together with all accrued and unpaid interest thereon, without presentment,     
demand, protest or other notice of any kind, all of which are hereby waived by  
the Issuer.                                                                     

               (b) At any time after such a declaration of acceleration of
the related Class of Notes has been made and before a judgment or decree for    
payment of the money due has been obtained by the Indenture Trustee as          
hereinafter in this Article provided, the Insurer may (or, if an Insurer Default
has occurred and is continuing, the Indenture Trustee may, and, if so directed  
by the Holders of Notes evidencing at least 66-2/3% of the Outstanding Amount of
the related Class of Notes, shall), by written notice to the Issuer, Servicer,  
Insurer and the Indenture Trustee, rescind and annul such declaration and its   
consequences, if:                                                               

           (i) the Issuer has paid or deposited with the Indenture
Trustee a sum sufficient to pay:                                                

           (A) all overdue amounts payable on or in respect of the
related Notes (other than amounts due solely as a result of the acceleration),  

                (B) to the extent that payment of interest on such amount is
lawful, interest on such overdue amounts at the applicable Note Interest Rate;  

                 (C) all unpaid amounts referred to in Section 6.7 and clauses
(iii) and (v) of Section 8.3(a);                                                

          (D) all sums paid or advanced by the Indenture Trustee
hereunder and the reasonable compensation, expenses, disbursements, and         
advances of the Indenture Trustee, its agents and counsel;                      

 and

            (ii) all Events of Default, other than the nonpayment of
amounts payable on or in respect of the related Notes which have become due     
solely by such declaration of acceleration, have been cured or waived as        
provided in Section 5.20.                                                       

No such rescission shall affect any subsequent Event of Default or impair any   
right consequent thereon.                                                       

             SECTION 5.3. Remedies.  (a) If an Event of Default occurs
and is continuing of which a Responsible Officer has actual knowledge, the      
Indenture Trustee shall give notice to each Noteholder of the related Class of  
Notes as set forth in Section 6.5.                                              

                 (b) Following any acceleration of the related Class of Notes,
the Indenture Trustee shall, subject to Section 5.3(d), have all of the rights, 
powers and remedies with respect to the Trust Property as are available to      
secured parties under the Uniform Commercial Code or                            

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other applicable law. Such rights, powers and remedies may be exercised by the  
Indenture Trustee in its own name as trustee of an express trust.               

                 (c) If an Event of Default specified in Section 5.1(a) occurs
and is continuing, the Indenture Trustee is authorized to recover judgment in   
its own name and as trustee of an express trust against the Issuer for the whole
amount of principal and interest remaining of the related Class Notes of not    
paid when due and payable.                                                      

           (d) In exercising its rights and obligations under this
Section 5.3, the Indenture Trustee may sell the Trust Property subject to the   
provisions of Section 5.19. Neither the Indenture Trustee nor any Noteholder of 
the related Class of Notes shall have any rights against the Issuer other than  
to enforce the Grant hereunder and to sell the Trust Property.                  

              SECTION 5.4. Indenture Trustee Shall File Proofs of Claim.
(a) In case of the pendency of any receivership, insolvency, liquidation,       
bankruptcy, reorganization, arrangement, adjustment, composition, or other      
judicial proceeding relative to the Issuer, the Servicer, the Unaffiliated      
Seller, the Insurer or any other obligor upon or in respect of the Notes or the 
other obligations secured hereby or relating to the property of the Issuer, the 
Servicer, the Unaffiliated Seller, the Insurer or of such other obligor or their
creditors, the Indenture Trustee (irrespective of whether the principal of the  
such Class of Notes shall then be due and payable as therein expressed or by    
declaration or otherwise and irrespective of whether the Indenture Trustee shall
have made any demand on the Issuer, the Servicer, the Unaffiliated Seller, or   
the Insurer for the payment of overdue principal or interest or any such other  
obligation) shall by intervention in such proceeding or otherwise:              

                (i) file and prove a claim for the whole amount of principal
      and interest owing and unpaid in respect of such Notes and any other
         obligation secured hereby and to file such other papers or documents as
  may be necessary or advisable in order to have the claims of the
         Indenture Trustee (including any claim for the reasonable compensation,
    expenses, disbursements and advances of the Indenture Trustee, its
         agents and counsel) and of the Noteholders of the Related Class allowed
in such judicial proceeding; and                              

                 (ii) collect and receive any moneys or other property payable
or deliverable on any such claims and to distribute the same; 

and any custodian, receiver, assignee, trustee, liquidator, sequestrator, or    
other similar official in any such judicial proceeding is hereby authorized by  
each Noteholder of the related Class to make such payments to the Indenture     
Trustee and, in the event that the Indenture Trustee shall consent to the making
of such payments directly to the Noteholders of the related Class to pay to the 
Indenture Trustee any amount due it for the reasonable compensation, expenses,  
disbursements and advances of the Indenture Trustee, its agents and counsel, and
any other amounts due the Indenture Trustee under Section 6.7.                  

                 (b) Nothing herein contained shall be deemed to authorize the
Indenture Trustee to authorize or consent to or accept or adopt on behalf of any
Noteholder of the related Class any plan of reorganization, arrangement,        
adjustment or composition affecting such Notes or the                           

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rights of any holder thereof or to authorize the Indenture Trustee to vote in   
respect of the claim of any Noteholder of the related Class in any such         
proceeding.                                                                     

             SECTION 5.5. Indenture Trustee May Enforce Claims Without
Possession of Notes. All rights of action and claims under this Indenture or    
any of the Notes may be prosecuted and enforced by the Indenture Trustee without
the possession of any of the Notes or the production thereof in any proceeding  
relating thereto, and any such proceeding instituted by the Indenture Trustee   
shall be brought in its own name as trustee of an express trust, and any        
recovery of judgment shall, after provision for the payment of the reasonable   
compensation, expenses, disbursements and advances of the Indenture Trustee, its
agents and counsel, be for the ratable benefit of the Holders of the related    
Class of Notes in respect of which such judgment has been recovered.            

           SECTION 5.6. Application of Money Collected.  Any money
collected by the Indenture Trustee pursuant to this Article (including all      
collections from, and proceeds of the sale or liquidation of, the Trust         
Property), and any moneys that may then be held or thereafter received by the   
Indenture Trustee shall be applied in the following order, at the date or dates 
fixed by the Indenture Trustee and, in case of the distribution of the entire   
amount due on account of principal or interest, upon presentation of the related
Class of Notes and surrender thereof:                                           

                 first, to the payment of all costs and expenses of collection
      incurred by the Indenture Trustee and the Noteholders of the related
         Class (including the reasonable fees and expenses of any counsel to the
     Indenture Trustee and the Noteholders of the related Class) and all
     amounts due and unpaid to the Indenture Trustee pursuant to Section
6.7; and                                                      

          second, in the same order as specified in Section 8.3.

            SECTION 5.7. Limitation on Rights of Noteholders. (a) No
Holder of any Note shall have any right to institute any Proceeding with respect
to this Indenture, or for the appointment of a receiver or trustee, or for any  
other remedy hereunder, unless:                                                 

              (i) such Holder has previously given written notice to the
Indenture Trustee of a continuing Event of Default;           

                 (ii) the Holders of Notes evidencing not less than 25% of the
    Outstanding Amount of the related Class of Notes have made written
  request to the Indenture Trustee to institute such Proceeding in
       respect of such Event of Default in its own name as Indenture Trustee
       hereunder; (iii) such Holder or Holders have offered to the Indenture
    Trustee indemnity reasonably satisfactory to it against the costs,
         expenses and liabilities to be incurred in complying with such request;

               (iv) the Indenture Trustee for 60 days after its receipt of
     such notice, request and offer of indemnity has failed to institute
such Proceedings;                                             

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               (v) no direction inconsistent with such written request has
      been given to the Indenture Trustee during such 60-day period by the
         Holders of a majority of the Outstanding Amount of the related Class of
Notes; and                                                    

                  (vi) an Insurer Default shall have occurred and be continuing;

it being understood and intended that no Holders of a Class of Notes shall have 
any right in any manner whatsoever by virtue of, or by availing of, any         
provision of this Indenture to affect, disturb or prejudice the rights of any   
other Holders of Notes or to obtain or to seek to obtain priority or preference 
over any other Holders or to enforce any right under this Indenture, except in  
the manner herein provided.                                                     

                In the event the Indenture Trustee shall receive conflicting
or inconsistent requests and indemnity from two or more groups of Holders of a  
Class of Notes, each representing less than a majority of the Outstanding Amount
of the related Class of Notes, the Indenture Trustee in its sole discretion may 
determine what action, if any, shall be taken, notwithstanding any other        
provisions of this Indenture.                                                   

           (b) The death or incapacity of any Noteholder shall not
operate to terminate this Indenture, nor entitle such Noteholder's legal        
representatives or heirs to claim an accounting or to take any action or        
Proceeding in any court for a partition or winding up of the Issuer, nor        
otherwise affect the rights, obligations and liabilities of the parties hereto  
or any of them.                                                                 

             (c) No Noteholder shall have any right to vote (except as
expressly provided for herein) or in any manner otherwise control the operation 
and management of the Issuer, or the obligations of the parties hereto, nor     
shall anything herein set forth, or contained in the terms of any of the Notes, 
be construed so as to constitute the Noteholders from time to time as partners  
or members of an association; nor shall any Noteholder be under any liability to
any third person by reason of any action taken by the parties to this Indenture 
pursuant to any provision hereof.                                               

               SECTION 5.8. Unconditional Rights of Noteholders to Receive
Principal and Interest. Notwithstanding any other provisions in this Indenture, 
the Holder of any Note shall have the right, which is absolute and              
unconditional, to receive payment of the principal of and interest on such Note 
on or after the respective due dates thereof expressed in such Note or in this  
Indenture (or, in the case of redemption, on or after the Redemption Date) and  
to institute suit for the enforcement of any such payment, and such right shall 
not be impaired without the consent of such Holder.                             

           SECTION 5.9. Restoration of Rights and Remedies. If any
Noteholder has instituted any Proceeding to enforce any right or remedy under   
this Indenture and such Proceeding has been discontinued or abandoned for any   
reason, then and in every such case the Issuer, the Indenture Trustee and the   
Noteholders shall, subject to any determination in such Proceeding, be restored 
severally and respectively to their former positions hereunder, and thereafter  
all rights and remedies of the Indenture Trustee and the Noteholders shall      
continue as though no such proceeding had been instituted.                      

             SECTION 5.10. Rights and Remedies Cumulative. No right or
remedy herein conferred upon or reserved to the Noteholders is intended to be   
exclusive of any other right or                                                 

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remedy, and every right and remedy shall, to the extent permitted by law, be    
cumulative and in addition to every other right and remedy given hereunder or   
now or hereafter existing at law or in equity or otherwise. The assertion or    
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.    

             SECTION 5.11. Delay or Omission Not a Waiver. No delay or
omission of the Indenture Trustee, any Holder of any Note or the Insurer to     
exercise any right or remedy accruing upon any Default or Event of Default shall
impair any such right or remedy or constitute a waiver of any such Default or   
Event of Default or an acquiescence therein. Every right and remedy given by    
this Article V or by law to the Indenture Trustee, to the Noteholders or the    
Insurer may be exercised from time to time, and as often as may be deemed       
expedient, by the Indenture Trustee , the Noteholders or the Insurer, as the    
case may be.                                                                    

                SECTION 5.12. Control by Insurer or Noteholders. The Insurer
(or, if an Insurer Default has occurred and is continuing, the Holders of Notes 
evidencing a majority of the Outstanding Amount of a Class of Notes) shall have 
the right to direct the time, method and place of conducting any Proceeding for 
any remedy available to the Indenture Trustee with respect to such Notes or     
exercising any trust or power conferred on the Indenture Trustee; provided that 

                (i) such direction shall not be in conflict with any rule of
law or with this Indenture;                                   

               (ii) the Indenture Trustee may take any other action deemed
    proper by the Indenture Trustee that is not inconsistent with such
direction;                                                    

provided, however, that, subject to Section 6.1, the Indenture Trustee need not 
take any action that it determines might involve it in liability or might       
materially adversely affect the rights of any Noteholders not consenting to such
action.                                                                         

            SECTION 5.13. Undertaking for Costs. All parties to this
Indenture agree, and each Holder of any Note by such Holder's acceptance thereof
shall be deemed to have agreed, that any court may in its discretion require, in
any suit for the enforcement of any right or remedy under this Indenture, or in 
any suit against the Indenture Trustee for any action taken, suffered or omitted
by it as Indenture Trustee, the filing by any party litigant in such suit of an 
undertaking to pay the costs of such suit, and that such court may in its       
discretion assess reasonable costs, including reasonable attorneys' fees,       
against any party litigant in such suit, having due regard to the merits and    
good faith of the claims or defenses made by such party litigant; but the       
provisions of this Section shall not apply to (a) any suit instituted by the    
Indenture Trustee or the Insurer, (b) any suit instituted by any Noteholder, or 
group of Noteholders, in each case holding in the aggregate more than 10% of the
Outstanding Amount of the related Class of Notes or (c) any suit instituted by  
any Noteholder of such Class for the enforcement of the payment of principal of 
or interest on any Note on or after the respective due dates thereof expressed  
in such Note and in this Indenture (or, in the case of redemption, on or after  
the Redemption Date).                                                           

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              SECTION 5.14. Waiver of Stay or Extension Laws. The Issuer
covenants (to the extent that it may lawfully do so) that it will not at any    
time insist upon, or plead or in any manner whatsoever, claim or take the       
benefit or advantage of, any stay or extension law wherever enacted, now or at  
any time hereafter in force, that may affect the covenants or the performance of
this Indenture; and the Issuer (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
will not hinder, delay or impede the execution of any power herein granted to   
the Indenture Trustee, but will suffer and permit the execution of every such   
power as though no such law had been enacted.                                   

                SECTION 5.15. Action on Notes. The Indenture Trustee's right
to seek and recover judgment on the Notes or under this Indenture shall not be  
affected by the seeking, obtaining or application of any other relief under or  
with respect to this Indenture. Neither the lien of this Indenture nor any      
rights or remedies of the Indenture Trustee or the Noteholders shall be impaired
by the recovery of any judgment by the Indenture Trustee against the Issuer or  
by the levy of any execution under such judgment upon any portion of the Trust  
Property or upon any of the assets of the Issuer.                               

        SECTION 5.16. Performance and Enforcement of Certain
Obligation. (a) Promptly following a request from the Indenture Trustee or the  
Insurer to do so, and at the Servicer's expense, the Issuer agrees to take all  
such lawful action as the Indenture Trustee or the Insurer may request to compel
or secure the performance and observance by the Unaffiliated Seller and the     
Servicer, as applicable, of each of their obligations to the Issuer under or in 
connection with the Sale and Servicing Agreement in accordance with the terms   
thereof, and to exercise any and all rights, remedies, powers and privileges    
lawfully available to the Issuer under or in connection with the Sale and       
Servicing Agreement to the extent and in the manner directed by the Indenture   
Trustee or the Insurer, including the transmission of notices of default on the 
part of the Unaffiliated Seller or the Servicer thereunder and the institution  
of legal or administrative actions or proceedings to compel or secure           
performance by the Unaffiliated Seller or the Servicer of each of their         
obligations under the Sale and Servicing Agreement.                             

                  (b) If an Event of Default has occurred and is continuing, the
Indenture Trustee may, and, at the written direction of the Insurer (or, if an  
Insurer Default has occurred and is continuing, the Holders of a Class of Notes 
evidencing at least 66-2/3% of the Outstanding Amount of the related Class of   
Notes), shall, exercise all rights, remedies, powers, privileges and claims of  
the Issuer against the Unaffiliated Seller or the Servicer under or in          
connection with the Sale and Servicing Agreement, including the right or power  
to take any action to compel or secure performance or observance by the         
Unaffiliated Seller or the Servicer of each of their obligations to the Issuer  
thereunder and to give any consent, request, notice, direction, approval,       
extension or waiver under the Sale and Servicing Agreement, and any right of the
Issuer to take such action shall be suspended.                                  

           SECTION 5.17. Subrogation.  The Indenture Trustee shall
receive as attorney-in-fact of each Noteholder any amount received from the     
Insurer under the Policy. Any and all amounts disbursed by the Indenture Trustee
from claims made under the Policy shall not be considered payment by the Issuer 
with respect to such Notes, and shall not discharge the obligations of the      
Issuer with respect thereto. The Insurer shall, to the extent it makes any      
payment with respect to the Notes, become subrogated to the rights of the       
recipient of such                                                               

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payments to the extent of such payments. Subject to and conditioned upon any    
payment with respect to the Notes by or on behalf of the Insurer, the Indenture 
Trustee shall assign to the Insurer all rights to the payment of interest or    
principal with respect to the Notes which are then due for payment to the extent
of all such payments made by the Insurer, and the Insurer may exercise any      
option, vote right, power or the like with respect to the Notes to the extent   
that it has made payment pursuant to the Policy.                                

                SECTION 5.18. Preference Claims. The Indenture Trustee shall
promptly notify the Insurer of any proceeding or the institution of any action, 
of which a Responsible Officer has actual knowledge, seeking the avoidance as a 
preferential transfer under applicable bankruptcy, insolvency, receivership or  
similar law (a "Preference Claim") of any distribution made with respect to a   
Class of Notes. Each Class A Noteholder, by its purchase of Class A Notes, the  
Servicer and the Indenture Trustee hereby agree that the Insurer (so long as no 
Insurer Default has occurred and is continuing) may at any time during the      
continuation of any proceeding relating to a Preference Claim direct all matters
relating to such Preference Claim, including, without limitation, (i) the       
direction of any appeal of any order relating to such Preference Claim and (ii) 
the posting of any surety, supersedes or performance bond pending any such      
appeal. In addition and without limitation of the foregoing, the Insurer shall  
be subrogated to the rights of the Servicer, the Indenture Trustee and each     
Class A Noteholder in the conduct of any such Preference Claim, including,      
without limitation, all rights of any party to an adversary proceeding action   
with respect to any court order issued in connection with any such Preference   
Claim.                                                                          

        SECTION 5.19. Sale of Trust Estate. (a) The power to
effect any sale of any portion of the Trust Property pursuant to this Section   
5.19 shall not be exhausted by any one or more sales as to any portion of the   
Trust Property remaining unsold, but shall continue unimpaired until the entire 
Trust Property shall have been sold or all amounts payable on the Notes shall   
have been paid. The Indenture Trustee may from time to time, upon directions in 
accordance with Section 5.12, postpone any public sale by public announcement   
made at the time and place of such sale.                                        

                (b) To the extent permitted by applicable law, the Indenture
Trustee shall not in any private sale sell to a third party the Trust Property, 
or any portion thereof unless,                                                  

               (i) until such time as the conditions specified in Sections
      10.01(a)(i) or 10.01(a)(ii) of the Sale and Servicing Agreement have
    been satisfied in full, the Insurer (or, if an Insurer Default has
      occurred and is continuing, the Holders of Notes evidencing at least
   66-2/3% of the Outstanding Amount of the related Class of Notes),
    consent to or direct the Indenture Trustee in writing to make such
sale; or                                                      

                 (ii) the proceeds of such sale would be not less than the sum
       of all amounts due to the Indenture Trustee hereunder and the Insurer
         under the Insurance Agreement and the entire unpaid principal amount of
       the Notes and all interest due or to become due thereon in accordance
     with Section 8.3(a) on the Payment Date next succeeding the date of
such sale.                                                    

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The foregoing provisions shall not preclude or limit the ability of the         
Indenture Trustee to purchase all or any portion of the Trust Property at a     
private sale.                                                                   

              (c) In connection with a sale of all or any portion of the
Trust Property:                                               

                (i) any one or more Noteholders may bid for and purchase the
       property offered for sale, and upon compliance with the terms of sale
     may hold, retain, and possess and dispose of such property, without
        further accountability, and any Noteholder may, in paying the purchase
         money therefor, deliver in lieu of cash any Outstanding Notes or claims
for interest thereon for credit in the amount that shall, upon
        distribution of the net proceeds of such sale, be payable thereon, and
       such Notes, in case the amounts so payable thereon shall be less than
      the amount due thereon, shall be returned to the Noteholders thereof
 after being appropriately stamped to show such partial payment;

           (ii) the Indenture Trustee shall execute and deliver an
       appropriate instrument of conveyance transferring its interest in any
portion of the Trust Property related to the Class of Notes in
connection with a sale thereof;                               

               (iii) the Indenture Trustee is hereby irrevocably appointed
         the agent and attorney-in-fact of the Issuer to transfer and convey its
       interest in any portion of the Trust Property related to the Class of
 Notes in connection with a sale thereof, and to take all action
necessary to effect such sale; and                            

                 (iv) no purchaser or transferee at such a sale shall be bound
  to ascertain the Indenture Trustee's authority, inquire into the
       satisfaction of any conditions precedent or see to the application of
any moneys.                                                   

                (d) The method, manner, time, place and terms of any sale of
all or any portion of the Trust Property shall be commercially
reasonable.                                                   

                  (e) The provisions of this Section 5.19 shall not be construed
to restrict the ability of the Indenture Trustee to exercise any rights and     
powers against the Issuer or the Trust Property that are vested in the Indenture
Trustee by this Indenture, including, without limitation, the power of the      
Indenture Trustee to proceed against the Collateral and to institute judicial   
proceedings for the collection of any deficiency remaining thereafter or the    
ability of the Servicer to exercise any rights or powers or to perform its      
obligations under the Sale and Servicing Agreement.                             

              SECTION 5.20. Waiver of Past Defaults. Prior to the time a
judgment or decree for payment of the money due has been obtained by the        
Indenture Trustee, the Insurer (or, if an Insurer Default has occurred and is   
continuing, the Holders of Notes evidencing at least a majority of the          
Outstanding Amount of the related Class of Notes) may on behalf of the Holders  
of all the Notes waive any past Default or Event of Default and its             
consequences, except a Default or Event of Default:                             

                  (a) In the payment of the principal of or interest on any Note
when due and payable, or                                                        

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               (b) In respect of a covenant or provision hereof that under
Section 9.2 cannot be modified or amended without the consent of the Holder of  
each Outstanding Note affected.                                                 

             In the case of any such waiver, the Issuer, the Indenture
Trustee and the Holders of the Notes shall be restored to their former positions
and rights hereunder, respectively; but no such waiver shall extend to any      
subsequent or other Default or Event of Default or impair any right consequent  
thereto. Upon such waiver, such Default or Event of Default shall cease to      
exist, and any Event of Default arising from any such Default shall be deemed to
have been cured, for every purpose of this Indenture; but no such waiver shall  
extend to any subsequent or other Default or Event of Default or impair any     
right consequent thereon.                                                       

ARTICLE VI

 The Indenture Trustee

             SECTION 6.1. Duties of Indenture Trustee. (a) If an Event
of Default has occurred and is continuing, the Indenture Trustee shall exercise 
the rights and powers vested in it by this Indenture and the Basic Documents and
use the same degree of care and skill in its exercise as a prudent person would 
exercise or use under the circumstances in the conduct of such person's own     
affairs; provided, however, that if the Indenture Trustee is acting as Servicer,
it shall use the same degree of care and skill as is required of the Servicer   
under the Sale and Servicing Agreement.                                         

                  (b)      Except during the continuance of an Event of Default:

               (i) the Indenture Trustee undertakes to perform such duties
      and only such duties as are specifically set forth in this Indenture
       and the Basic Documents and no implied covenants or obligations shall
be read into this Indenture or the Basic Documents against the
Indenture Trustee; and                                        

               (ii) in the absence of bad faith on its part, the Indenture
      Trustee may conclusively rely, as to the truth of the statements and
         the correctness of the opinions expressed therein, upon certificates or
   opinions furnished to the Indenture Trustee and conforming to the
      requirements of this Indenture and the Basic Documents; however, the
  Indenture Trustee shall examine the certificates and opinions to
         determine whether or not they conform on their face to the requirements
      of this Indenture and the Basic Documents. (c) The Indenture Trustee
        may not be relieved from liability for its own gross negligent action,
      its own gross negligent failure to act or its own misconduct, except
that:                                                         

                 (i) this paragraph does not limit the effect of paragraph (b)
of this Section;                                              

                (ii) the Indenture Trustee shall not be liable for any error
      of judgment made in good faith by a Responsible Officer unless it is
     proved that the Indenture Trustee was negligent in ascertaining the
pertinent facts;                                              

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                (iii) the Indenture Trustee shall not be liable with respect
     to any action it takes or omits to take in good faith in accordance
    with a direction received by it from Holders of Notes evidencing a
  majority of the Outstanding Amount of the Notes (or such greater
         percentage as may be required by the terms hereof), with the consent of
the Insurer if no Insurer Default shall have occurred and be  
      continuing, relating to the time, method and place of conducting any
  Proceeding for any remedy available to the Indenture Trustee, or
     exercising any trust or power conferred upon the Indenture Trustee,
under this Indenture; and                                     

                  (iv) the Indenture Trustee shall not be charged with knowledge
      of any failure by the Servicer to comply with the obligations of the
      Servicer under the Sale and Servicing Agreement unless a Responsible
       Officer obtains actual knowledge of such failure or occurrence or the
         Indenture Trustee receives written notice of such failure or occurrence
      from the Servicer, the Insurer or the Holders of Notes entitled to a
majority of the Voting Rights.                                

                 (d) The Indenture Trustee shall not be liable for interest on
any money received by it except as the Indenture Trustee may agree in writing   
with the Issuer.                                                                

                  (e) No provision of this Indenture shall require the Indenture
Trustee to expend or risk its own funds or otherwise incur financial liability  
in the performance of any of its duties hereunder or in the exercise of any of  
its rights or powers, if it shall have reasonable grounds to believe that       
repayment of such funds or indemnity reasonably satisfactory to it against such 
risk or liability is not reasonably assured to it.                              

                 (f) Every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Indenture Trustee  
shall be subject to the provisions of this Section and to the provisions of the 
TIA.                                                                            

              (g) The Indenture Trustee shall, upon three Business Day's
prior written notice to the Indenture Trustee, permit any representative of the 
Insurer, during the Indenture Trustee's normal business hours, to examine all   
books of account, records, reports and other papers of the Indenture Trustee    
relating to the Notes, to make copies and extracts therefrom and to discuss the 
Indenture Trustee's affairs and actions, as such affairs and actions relate to  
the Indenture Trustee's duties with respect to the Notes, with the Indenture    
Trustee's officers and employees responsible for carrying out the Indenture     
Trustee's duties with respect to the Notes.                                     

                 (h) The Indenture Trustee is hereby authorized to execute and
shall execute the Sale and Servicing Agreement and shall perform its duties and 
satisfy its obligations thereunder. Every provision of this Indenture relating  
to the conduct or affecting the liability of or affording protection to the     
Indenture Trustee shall apply to the Indenture Trustee's execution of the Sale  
and Servicing Agreement and the performance of its duties and satisfaction of   
its obligations thereunder.                                                     

              (i) The Indenture Trustee shall, and hereby agrees that it
will, hold the Policy in trust, and will hold any proceeds of any claim on the  
Policy in trust solely for the use and benefit of the Noteholders.              

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              (j) In no event shall the Indenture Trustee, in any of its
capacities hereunder, be deemed to have assumed any duties of the Owner Trustee 
under the Delaware Business Trust Statute, common law, or the Trust Agreement.  

     SECTION 6.2. Rights of Indenture Trustee. (a) The
Indenture Trustee may rely on any document reasonably believed by it to be      
genuine and to have been signed or presented by the proper person. The Indenture
Trustee need not investigate any fact or matter stated in the document.         

                  (b) Before the Indenture Trustee acts or refrains from acting,
it may require an Officer's Certificate or an Opinion of Counsel. The Indenture 
Trustee shall not be liable for any action it takes or omits to take in good    
faith in reliance on the Officer's Certificate or Opinion of Counsel.           

              (c) The Indenture Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or       
through agents or attorneys or a custodian or nominee.                          

                (d) The Indenture Trustee shall not be liable for any action
it takes or omits to take in good faith which it believes to be authorized or   
within its rights or powers; provided, however, that the Indenture Trustee's    
conduct does not constitute willful misconduct, negligence or bad faith.        

               (e) The Indenture Trustee may consult with counsel, and the
advice or opinion of counsel with respect to legal matters relating to this     
Indenture and the Notes shall be full and complete authorization and protection 
from liability in respect to any action taken, omitted or suffered by it        
hereunder in good faith and in accordance with the advice or opinion of such    
counsel.                                                                        

             (f) The Indenture Trustee shall be under no obligation to
institute, conduct or defend any litigation under this Indenture or in relation 
to this Indenture, at the request, order or direction of any of the Holders of  
Notes, pursuant to the provisions of this Indenture, unless such Holders of     
Notes shall have offered to the Indenture Trustee reasonable security or        
indemnity against the costs, expenses and liabilities that may be incurred      
therein or thereby; provided, however, that the Indenture Trustee shall, upon   
the occurrence of an Event of Default (that has not been cured or waived),      
exercise the rights and powers vested in it by this Indenture or the Sale and   
Servicing Agreement with reasonable care and skill.                             

           (g) Prior to the occurrence of an Event of Default, the
Indenture 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 Insurer (or, if an Insurer
Default has occurred and is continuing, by the Holders of Notes evidencing not  
less than 25% of the Outstanding Amount of the related Class of Notes);         
provided, however, that if the payment within a reasonable time to the Indenture
Trustee of the costs, expenses or liabilities likely to be incurred by it in the
making of such investigation is, in the opinion of the Indenture Trustee, not   
reasonably assured to the Indenture Trustee by the security afforded to it by   
the terms of this                                                               

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Indenture, the Indenture Trustee may require indemnity reasonably satisfactory  
to it against such cost, expense or liability as a condition to so proceeding;  
the reasonable expense of every such examination shall be paid by the Person    
making such request, or, if paid by the Indenture Trustee shall be reimbursed by
the Person making such request upon demand.                                     

                  (h) The Indenture Trustee shall not be accountable, shall have
no liability and makes no representation as to any acts or omissions hereunder  
or under the Sale and Servicing Agreement of the Servicer until such time as the
Indenture Trustee may be required to act as Servicer.                           

                (i) The Indenture Trustee shall not be personally liable for
any loss resulting from the investment of funds held in any Investment Account  
at the direction of the Servicer pursuant to Section 8.11.                      

            SECTION 6.3. Individual Rights of Indenture Trustee. The
Indenture Trustee in its individual or any other capacity may become the owner  
or pledgee of Notes and may otherwise deal with the Issuer or its Affiliates    
with the same rights it would have if it were not Indenture Trustee. Any Note   
Paying Agent, Note Registrar, co-registrar or co-paying agent may do the same   
with like rights. However, the Indenture Trustee must comply with Sections 6.11 
and 6.12.                                                                       

              SECTION 6.4. Indenture Trustee's Disclaimer. The Indenture
Trustee shall not be responsible for and makes no representation as to the      
validity or adequacy of this Indenture or any of the Basic Documents, the Trust 
Property or the Notes, it shall not be accountable for the Issuer's use of the  
proceeds from the Notes, and it shall not be responsible for any statement of   
the Issuer in the Indenture or in any document issued in connection with the    
sale of the Notes or in the Notes other than the Indenture Trustee's certificate
of authentication.                                                              

           SECTION 6.5. Notice of Defaults. If a Servicer Event of
Default or an Event of Default occurs and is continuing and if it is either     
known by, or written notice of the existence thereof has been delivered to, a   
Responsible Officer, the Indenture Trustee shall mail to each Noteholder of such
event within 90 days after such knowledge or notice occurs. Except in the case  
of a Default in payment of principal of or interest on any Note when due and    
payable, the Indenture Trustee may withhold the notice if and so long as a      
committee of its Responsible Officers in good faith determines that withholding 
the notice is in the interests of Noteholders.                                  

              SECTION 6.6. Reports by Indenture Trustee to Holders. Upon
written request, the Note Paying Agent or the Servicer shall on behalf of the   
Issuer deliver to each Noteholder such information as may be reasonably required
to enable such Holder to prepare its Federal and state income tax returns       
required by law.                                                                

    SECTION 6.7. Compensation and Indemnity. (a) The
Indenture Trustee shall withdraw from the Distribution Account on each Payment  
Date and pay to itself the Indenture Trustee's Fee and, to the extent that the  
funds therein are at any time insufficient for such purpose, the Servicer shall 
pay such fees. Any such amount so withdrawn from the Distribution Amount shall  
reduce the Available Distribution Amount for each Group pro rata based upon the 
relative proportions of the aggregate Stated Principal Balances of the Mortgage 
Loans and any                                                                   

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REO Properties in each Group as of the preceding Payment Date (or, in the case  
of the initial Payment Date as of the Cut-Off Date to the total aggregate Stated
Principal Balance of Mortgage Loans and the REO Properties in both Groups as of 
such date). The Indenture Trustee and any director, officer, employee or agent  
of the Indenture Trustee shall be indemnified by the Issuer from the Trust      
Property and held harmless against any loss, liability or expense (not including
expenses, disbursements and advances incurred or made by the Indenture Trustee, 
including the compensation and the expenses and disbursements of its agents and 
counsel, in the ordinary course of the Indenture Trustee's performance in       
accordance with the provisions of this Agreement) incurred by the Indenture     
Trustee arising out of or in connection with the acceptance or administration of
its obligations and duties under this Agreement, other than any loss, liability 
or expense (i) resulting from the Servicer's actions or omissions in connection 
with the Sale and Servicing Agreement and the Mortgage Loans (but only to the   
extent the Indenture Trustee is actually indemnified by the Servicer pursuant to
the Sale and Servicing Agreement), or (ii) any loss, liability or expense       
incurred by reason of willful misfeasance, bad faith or gross negligence in the 
performance of the Indenture Trustee's duties hereunder or by reason of reckless
disregard of the Indenture Trustee's obligations and duties hereunder.          

                 (b) The Issuer's payment obligations to the Indenture Trustee
pursuant to this Section shall survive the discharge of this Indenture.         
Notwithstanding anything else set forth in this Indenture or the Basic          
Documents, the Indenture Trustee agrees that the obligations of the Issuer (but 
not the Servicer) to the Indenture Trustee hereunder and under the Basic        
Documents shall be recourse to the Trust Property only and specifically shall   
not be recourse to the assets of the Issuer or any Securityholder. In addition, 
the Indenture Trustee agrees that its recourse to the Issuer, the Trust Property
and amounts held in any of the Trust Accounts shall be limited to the right to  
receive the distributions referred to in Section 8.3 hereof.                    

                SECTION 6.8. Replacement of Indenture Trustee. The Indenture
Trustee may resign at any time by so notifying the Issuer, the Servicer, the    
Unaffiliated Seller and the Insurer by written notice. Upon receiving such      
notice of resignation, the Issuer shall promptly appoint a successor Indenture  
Trustee (approved in writing by the Insurer, so long as such approval is not    
unreasonably withheld) by written instrument, in duplicate, one copy of such    
instrument shall be delivered to the resigning Indenture Trustee (who shall     
deliver a copy to the Servicer) and one copy to the successor Trustee. The      
Insurer (or, if an Insurer Default has occurred and is continuing, the Issuer)  
may remove the Indenture Trustee, if:                                           

                (i) the Indenture Trustee fails to comply with Section 6.11;

                  (ii) a court having jurisdiction in the premises in respect of
  the Indenture Trustee in an involuntary case or proceeding under
  federal or state banking or bankruptcy laws, as now or hereafter
   constituted, or any other applicable federal or state bankruptcy,
       insolvency or other similar law, shall have entered a decree or order
 granting relief or appointing a receiver, liquidator, assignee,
         custodian, trustee, conservator, sequestrator (or similar official) for
    the Indenture Trustee or for any substantial part of the Indenture
      Trustee's property, or ordering the winding-up or liquidation of the
Indenture Trustee's affairs;                                  

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                (iii) an involuntary case under the federal bankruptcy laws,
        as now or hereafter in effect, or another present or future federal or
       state bankruptcy, insolvency or similar law is commenced with respect
         to the Indenture Trustee and such case is not dismissed within 60 days;

               (iv) the Indenture Trustee commences a voluntary case under
      any federal or state banking or bankruptcy laws, as now or hereafter
   constituted, or any other applicable federal or state bankruptcy,
       insolvency or other similar law, or consents to the appointment of or
   taking possession by a receiver, liquidator, assignee, custodian,
        trustee, conservator, sequestrator (or other similar official) for the
Indenture Trustee or for any substantial part of the Indenture
Trustee's property, or makes any assignment for the benefit of
        creditors or fails generally to pay its debts as such debts become due
       or takes any corporate action in furtherance of any of the foregoing;
or                                                            

            (v) the Indenture Trustee otherwise becomes incapable of
acting.                                                       

                  If the Indenture Trustee resigns or is removed or if a vacancy
exists in the office of Indenture Trustee for any reason (the Indenture Trustee 
in such event being referred to herein as the retiring Indenture Trustee), the  
Issuer shall promptly appoint a successor Indenture Trustee (approved in writing
by the Insurer, so long as such approval is not unreasonably withheld). If the  
Issuer fails to appoint such a successor Indenture Trustee, the Insurer may     
appoint a successor Indenture Trustee.                                          

         A successor Indenture Trustee shall deliver a written
acceptance of its appointment to the retiring Indenture Trustee, to the Insurer 
and to the Issuer. Thereupon the resignation or removal of the retiring         
Indenture Trustee shall become effective, and the successor Indenture Trustee   
shall have all the rights, powers and duties of the retiring Indenture Trustee  
under this Indenture. The successor Indenture Trustee shall mail a notice of its
succession to Noteholders. The retiring Indenture Trustee shall promptly        
transfer all property held by it as Indenture Trustee to the successor Indenture
Trustee.                                                                        

                If a successor Indenture Trustee does not take office within
30 days after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Insurer (or, if an Insurer Default has occurred and is   
continuing, the Issuer or the Holders of Notes evidencing a majority of the     
Outstanding Amount of the Notes) may petition any court of competent            
jurisdiction for the appointment of a successor Indenture Trustee acceptable to 
the Insurer.                                                                    

               If the Indenture Trustee fails to comply with Section 6.11,
the Insurer (or, if an Insurer Default has occurred and is continuing, the      
Issuer or the Holders of Notes evidencing a majority of the Outstanding Amount  
of the Notes), may petition any court of competent jurisdiction for the removal 
of the Indenture Trustee and the appointment of a successor Indenture Trustee   
acceptable to the Insurer.                                                      

           Any resignation or removal of the Indenture Trustee and
appointment of a successor Indenture Trustee pursuant to any of the provisions  
of this Section shall not become effective until acceptance of appointment by   
the successor Indenture Trustee pursuant to Section 6.8 and payment of all fees 
and expenses owed to the outgoing Indenture Trustee.                            

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            Notwithstanding the replacement of the Indenture Trustee
pursuant to this Section, the Issuer's and the Servicer's indemnity obligations 
under Section 6.7 shall continue for the benefit of the retiring Indenture      
Trustee and the Servicer shall pay any amounts owing to the Indenture Trustee.  

              SECTION 6.9. Successor Indenture Trustee by Merger. If the
Indenture Trustee consolidates with, merges or converts into, or transfers all  
or substantially all its corporate trust business or assets to, another         
corporation or banking association, the resulting, surviving or transferee      
corporation without any further act shall (subject to replacement as provided in
Section 6.8) be the successor Indenture Trustee.                                

               In case at the time such successor or successors by merger,
conversion or consolidation to the Indenture Trustee shall succeed to the trusts
created by this Indenture any of the Notes shall have been authenticated but not
delivered, any such successor to the Indenture Trustee may adopt the certificate
of authentication of any predecessor trustee, and deliver such Notes so         
authenticated; and in case at that time any of the Notes shall not have been    
authenticated, any successor to the Indenture Trustee may authenticate such     
Notes either in the name of any predecessor hereunder or in the name of the     
successor to the Indenture Trustee; and in all such cases such certificates     
shall have the full force which it is anywhere in the Notes or in this Indenture
provided that the certificate of the Indenture Trustee shall have.              

                 SECTION 6.10. Appointment of Co-Indenture Trustee or Separate
Indenture Trustee. (a) Notwithstanding any other provisions of this             
Indenture, at any time, for the purpose of meeting any legal requirement of any 
jurisdiction in which any part of the Trust may at the time be located, the     
Indenture Trustee with the consent of the Insurer shall have the power and may  
execute and deliver all instruments to appoint one or more Persons to act as a  
co-trustee or co-trustees, or separate trustee or separate trustees, of all or  
any part of the Trust, and to vest in such Person or Persons, in such capacity  
and for the benefit of the Noteholders, such title to the Trust, or any part    
hereof, and, subject to the other provisions of this Section, such powers,      
duties, obligations, rights and trusts as the Indenture Trustee may consider    
necessary or desirable. No co-trustee or separate trustee hereunder shall be    
required to meet the terms of eligibility as a successor trustee under Section  
6.11 and no notice to Noteholders of the appointment of any co-trustee or       
separate trustee shall be required under Section 6.8 hereof.                    

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

               (i) all rights, powers, duties and obligations conferred or
       imposed upon the Indenture Trustee shall be conferred or imposed upon
       and exercised or performed by the Indenture 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
         Indenture 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 the Indenture 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 Trust 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 Indenture Trustee;                       

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                  (ii) no trustee hereunder shall be personally liable by reason
       of any act or omission of any other trustee hereunder, including acts
or omissions of predecessor or successor trustees; and        

          (iii) the Indenture Trustee may at any time accept the
resignation of or remove any separate trustee or co-trustee.  

         (c) Any notice, request or other writing given to the
Indenture Trustee shall be deemed to have been given to each of the then        
separate trustees and co-trustees, 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 VI. 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 Indenture Trustee or separately, as may be provided therein,   
subject to all the provisions of this Indenture, specifically including every   
provision of this Indenture relating to the conduct of, affecting the liability 
of, or affording protection to, the Indenture Trustee. Every such instrument    
shall be filed with the Indenture Trustee.                                      

          (d) Any separate trustee or co-trustee may at any time
constitute the Indenture 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, dissolve, become insolvent, 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 Indenture Trustee, to the      
extent permitted by law, without the appointment of a new or successor trustee. 

             (e) The Servicer shall be responsible for the fees of any
co-trustee or separate trustee appointed hereunder.                             

                 SECTION 6.11. Eligibility. The Indenture Trustee shall at all
times satisfy the requirements of TIA ss. 310(a). The Indenture Trustee shall   
have a combined capital and surplus of at least $50,000,000 as set forth in its 
most recent published annual report of condition. The Indenture Trustee shall   
provide copies of such reports to the Insurer upon request. The Indenture       
Trustee shall comply with TIA ss. 310(b), including the optional provision      
permitted by the second sentence of TIA ss. 310(b)(9); provided, however, that  
there shall be excluded from the operation of TIA ss. 310(b)(1) any indenture or
indentures under which other securities of the Issuer are outstanding if the    
requirements for such exclusion set forth in TIA ss. 310(b)(1) are met.         

           SECTION 6.12. Preferential Collection of Claims Against
Issuer. The Indenture Trustee shall comply with TIA ss. 311(a), excluding any   
creditor relationship listed in TIA ss. 311(b). An Indenture Trustee who has    
resigned or been removed shall be subject to TIA ss. 311(a) to the extent       
indicated.                                                                      

              SECTION 6.13. Appointment and Powers. Subject to the terms
and conditions hereof, each of the Issuer Secured Parties hereby appoints First 
Union National Bank as the Indenture Trustee with respect to the Collateral, and
First Union National Bank hereby accepts such appointment and agrees to act as  
Indenture Trustee with respect to the Trust Property for the                    

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Issuer Secured Parties, to maintain custody and possession of such Trust        
Property (except as otherwise provided hereunder or under the Sale and Servicing
Agreement) and to perform the other duties of the Indenture Trustee in          
accordance with the provisions of this Indenture and the other Basic Documents. 
Each Issuer Secured Party hereby authorizes the Indenture Trustee to take such  
action on its behalf, and to exercise such rights, remedies, powers and         
privileges hereunder, as the Insurer (or, if an Insurer Default has occurred and
is continuing, Holders of Notes evidencing a majority (or such greater          
percentage as may be required by the terms hereof) of the Outstanding Amount of 
the Notes) may direct and as are specifically authorized to be exercised by the 
Indenture Trustee by the terms hereof, together with such actions, rights,      
remedies, powers and privileges as are reasonably incidental thereto. The       
Indenture Trustee shall act upon and in compliance with the written instructions
of the Insurer (or, if an Insurer Default has occurred and is continuing,       
Holders of Notes evidencing a majority (or such greater percentage as may be    
required by the terms hereof) of the Outstanding Amount of the related Class of 
Notes) delivered pursuant to this Indenture promptly following receipt of such  
written instructions; provided that the Indenture Trustee shall not act in      
accordance with any instructions (i) which are not authorized by, or in         
violation of the provisions of, this Indenture or (ii) for which the Indenture  
Trustee has not received reasonable indemnity. Receipt of such instructions     
shall not be a condition to the exercise by the Indenture Trustee of its express
duties hereunder, except where this Indenture provides that the Indenture       
Trustee is permitted to act only following and in accordance with such          
instructions.                                                                   

              SECTION 6.14. Performance of Duties. The Indenture Trustee
shall have no duties or responsibilities except those expressly set forth in    
this Indenture and the other Basic Documents to which the Indenture Trustee is a
party or as directed by the Controlling Party in accordance with this Indenture.
The Indenture Trustee shall not be required to take any discretionary actions   
hereunder except at the written direction of the Insurer (or, if an Insurer     
Default has occurred and is continuing, Holders of Notes evidencing a majority  
(or such greater percentage as may be required by the terms hereof) of the      
Outstanding Amount of the related Class of Notes) and with indemnification as   
provided herein.                                                                

                SECTION 6.15. Limitation on Liability. Neither the Indenture
Trustee nor any of its directors, officers, employees and agents shall be liable
for any action taken or omitted to be taken by it or them hereunder, or in      
connection herewith, except that the Indenture Trustee shall be liable for its  
gross negligence, bad faith or willful misconduct; nor shall the Indenture      
Trustee be responsible for the validity, effectiveness, value, sufficiency or   
enforceability against the Issuer of this Indenture or any of the Trust Property
(or any part thereof).                                                          

            SECTION 6.16. Reliance Upon Documents. In the absence of
negligence, bad faith or willful misconduct on its part, the Indenture Trustee  
shall be entitled to rely on any communication, instrument, paper or other      
document reasonably believed by it to be genuine and correct and to have been   
signed or sent by the proper Person or Persons and shall have no liability in   
acting, or omitting to act, where such action or omission to act is in          
reasonable reliance upon any statement or opinion contained in any such document
or instrument.                                                                  

                 SECTION 6.17. Representations and Warranties of the Indenture
Trustee.  The Indenture Trustee represents and warrants to the Issuer and to    
each Issuer Secured Party as follows:                                           

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               (a) The Indenture Trustee is a national banking association
duly organized, validly existing and in good standing under the laws of the     
United States.                                                                  

           (b) The execution and delivery of this Indenture by the
Indenture Trustee, and the performance and compliance with the terms of this    
Indenture by the Indenture Trustee, will not violate the Indenture Trustee's    
charter or bylaws or constitute a default (or an event which, with notice or    
lapse of time, or both, would constitute a default) under, or result in the     
breach of, any material agreement or other instrument to which it is a party or 
which is applicable to it or any of its assets.                                 

                 (c) The Indenture Trustee has the full power and authority to
enter into and consummate all transactions contemplated by this Indenture, has  
duly authorized the execution, delivery and performance of this Indenture, and  
has duly executed and delivered this Indenture.                                 

                 (d) This Indenture, assuming due authorization, execution and
delivery by the Issuer, constitutes a valid, legal and binding obligation of the
Indenture Trustee, enforceable against the Indenture Trustee in accordance with 
the terms hereof, subject to (A) applicable bankruptcy, insolvency,             
receivership, reorganization, moratorium and other laws affecting the           
enforcement of creditors' rights generally, and (B) general principles of       
equity, regardless of whether such enforcement is considered in a proceeding in 
equity or at law.                                                               

             (e) The Indenture Trustee is not in violation of, and its
execution and delivery of this Indenture and its performance and compliance with
the terms of this Indenture will not constitute a violation of, any law, any    
order or decree of any court or arbiter, or any order, regulation or demand of  
any federal, state or local governmental or regulatory authority, which         
violation, in the Indenture Trustee's good faith and reasonable judgment, is    
likely to affect materially and adversely either the ability of the Indenture   
Trustee to perform its obligations under this Indenture or the financial        
condition of the Indenture Trustee.                                             

                 (f) No litigation is pending or, to the best of the Indenture
Trustee's knowledge, threatened against the Indenture Trustee which would       
prohibit the Indenture Trustee from entering into this Indenture or, in the     
Indenture Trustee's good faith reasonable judgment, is likely to materially and 
adversely affect either the ability of the Indenture Trustee to perform its     
obligations under this Indenture or the financial condition of the Indenture    
Trustee.                                                                        

                 SECTION 6.18. Waiver of Setoffs. The Indenture Trustee hereby
expressly waives any and all rights of setoff that the Indenture Trustee may    
otherwise at any time have under applicable law with respect to any Trust       
Account and agrees that amounts in the Trust Accounts shall at all times be held
and applied solely in accordance with the provisions hereof.                    

                 SECTION 6.19. Suits for Enforcement. In case a Servicer Event
of Default or other default by the Servicer under the Sale and Servicing        
Agreement shall occur and be continuing, the Indenture Trustee (with the consent
of the Insurer if no Insurer Default has occurred and is continuing) may proceed
to protect and enforce its rights and the rights of the Noteholders under this  
Indenture by a suit, action or proceeding in equity or at law or otherwise,     
whether for the specific performance of any covenant or agreement contained in  
this Agreement or in aid of the execution of any power granted in this Agreement
or for the enforcement of any                                                   

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other legal, equitable or other remedy, as the Indenture Trustee, being advised 
by counsel, shall deem most effectual to protect and enforce any of the rights  
of the Indenture Trustee and the Noteholders.                                   

                 SECTION 6.20. Mortgagor Claims. In connection with any offset
defenses, or affirmative claim for recovery, asserted in legal actions brought  
by Mortgagors under one or more Mortgage Loans based upon provisions therein or 
upon other rights or remedies arising from any requirements of law applicable to
the Mortgage Loans:                                                             

                  (a) The Indenture Trustee is the holder of Mortgage Loans only
as trustee on behalf of the holders of the Notes, and not as a principal or in  
any individual or personal capacity.                                            

                 (b) The Indenture Trustee shall not be personally liable for,
or obligated to pay Mortgagors, any affirmative claims asserted thereby, or     
responsible to holders of the Notes for any offset defense amounts applied      
against Mortgage Loan payments for the related Group, pursuant to such legal    
actions.                                                                        

             (c) The Indenture Trustee will pay, solely from available
Trust money, affirmative claims for recovery by Mortgagors only pursuant to     
final judicial orders or judgments, or judicially approved settlement           
agreements, resulting from such legal actions.                                  

                  (d) The Indenture Trustee will comply with judicial orders and
judgments which require its actions or cooperation in connection with           
Mortgagors' legal actions to recover affirmative claims against holders of the  
Notes.                                                                          

                (e) The Indenture Trustee will cooperate with and assist the
Servicer, the Unaffiliated Seller, or holders of the Notes in their defense of  
legal actions by Mortgagors to recover affirmative claims if such cooperation   
and assistance is not contrary to the interests of the Indenture Trustee as a   
party to such legal actions and if the Indenture Trustee is satisfactorily      
indemnified for all liability, costs and expenses arising therefrom.            

                (f) The Issuer hereby agrees to indemnify, hold harmless and
defend the Indenture Trustee from and against any and all liability, loss, costs
and expenses of the Indenture Trustee resulting from any affirmative claims for 
recovery asserted or collected by mortgagors under the Mortgage Loans.          

              SECTION 6.21. Certain Available Information. The Indenture
Trustee shall maintain its Corporate Trust Office and make available free of    
charge during normal business hours for review by any Holder of a Note or any   
Person identified to the Indenture Trustee as a prospective transferee of a     
Note, originals or copies of the following items: (A) this Indenture and any    
supplements hereto entered into pursuant to Article IX, (B) the Sale and        
Servicing Agreement and any amendments thereto entered into pursuant to Section 
12.01 of the Sale and Servicing Agreement, (C) all monthly statements required  
to be delivered to Noteholders of the relevant Class pursuant to Section 4.02 of
the Sale and Servicing Agreement since the Closing Date, and all other notices, 
reports, statements and written communications delivered to the Noteholders of  
the relevant Class pursuant to this Indenture or the Sale and Servicing         
Agreement since the Closing Date (to the extent the Indenture Trustee is in     
receipt thereof), (D) any and all                                               

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Officer's Certificates delivered to the Indenture Trustee by the Servicer since 
the Closing Date to evidence the Servicer's determination that any Monthly      
Advance or Servicing Advance, was, or if made, would be a Nonrecoverable Monthly
Advance, and (E) any and all Officer's Certificates delivered to the Indenture  
Trustee by the Servicer since the Closing Date pursuant to Section 4.04 of the  
Sale and Servicing Agreement. Copies and mailing of any and all of the foregoing
items will be available from the Indenture Trustee upon request at the expense  
of the Person requesting the same.                                              

ARTICLE VII 

Noteholders' Lists and Reports

                 SECTION 7.1. Issuer to Furnish to Indenture Trustee Names and
Addresses of Noteholders. The Issuer will furnish or cause to be furnished to   
the Indenture Trustee or the Insurer (a) not more than five days after the      
earlier of (i) each Record Date and (ii) three months after the last Record     
Date, a list, in such form as the Indenture Trustee or the Insurer may          
reasonably require, of the names and addresses of the Holders as of such Record 
Date, (b) at such other times as the Indenture Trustee or the Insurer may       
request in writing, within 30 days after receipt by the Issuer of any such      
request, a list of similar form and content as of a date not more than 10 days  
prior to the time such list is furnished; provided, however, that so long as the
Indenture Trustee is the Note Registrar, no such list shall be required to be   
furnished. The Indenture Trustee or, if the Indenture Trustee is not the Note   
Registrar, the Issuer shall furnish to the Insurer or the Issuer in writing upon
their written request and at such other times as the Insurer or the Issuer may  
request a copy of the list.                                                     

               SECTION 7.2. Preservation of Information; Communications to
Noteholders. (a) The Indenture Trustee shall preserve, in as current a form     
as is reasonably practicable, the names and addresses of the Holders contained  
in the most recent list furnished to the Indenture Trustee as provided in       
Section 7.1 and the names and addresses of Holders received by the Indenture    
Trustee in its capacity as Note Registrar. The Indenture Trustee may destroy any
list furnished to it as provided in such Section 7.1 upon receipt of a new list 
so furnished.                                                                   

              (b) Noteholders may communicate pursuant to TIA ss. 312(b)
with other Noteholders with respect to their rights under this Indenture or     
under the Notes.                                                                

                (c) The Issuer, the Indenture Trustee and the Note Registrar
shall have the protection of TIA ss. 312(c).                                    

         SECTION 7.3. Reports by Issuer. (a) The Issuer shall:

                 (i) file with the Indenture Trustee, within 15 days after the
       Issuer or Depositor is required to file the same with the Commission,
       copies of the annual reports and copies of the information, documents
       and other reports (or copies of such portions of any of the foregoing
  as the Commission may from time to time by rules and regulations
       prescribe) which the Issuer or Depositor may be required to file with
     the Commission pursuant to Section 13 or 15(d) of the Exchange Act;

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              (ii) file with the Indenture Trustee and the Commission in
       accordance with rules and regulations prescribed from time to time by
        the Commission such additional information, documents and reports with
      respect to compliance by the Issuer or Depositor with the conditions
         and covenants of this Indenture as may be required from time to time by
such rules and regulations; and                               

            (iii) supply to the Indenture Trustee (and the Indenture
        Trustee shall transmit by mail to all Noteholders described in TIA ss.
  313(c)) such summaries of any information, documents and reports
         required to be filed by the Issuer or Depositor pursuant to clauses (i)
 and (ii) of this Section 7.3(a) as may be required by rules and
regulations prescribed from time to time by the Commission.   

                  (b) Unless the Issuer otherwise determines, the fiscal year of
the Issuer shall end on December 31 of each year.                               

                 SECTION 7.4. Reports by Indenture Trustee. If required by TIA
ss. 313(a), within 60 days after each March 31, beginning with March 31, 2000,  
the Indenture Trustee shall mail to each Noteholder as required by TIA ss.      
313(c) and the Insurer a brief report dated as of such date that complies with  
TIA ss. 313(a). The Indenture Trustee also shall comply with TIA ss. 313(b).    

       A copy of each report at the time of its mailing to
Noteholders shall be filed by the Indenture Trustee with the Commission and each
stock exchange, if any, on which the Notes are listed. The Issuer shall notify  
the Indenture Trustee and the Insurer if and when the Notes are listed on any   
stock exchange.                                                                 

ARTICLE VIII
 Accounts; Investment of Moneys;
 Collection and Application of Moneys; Reports

         SECTION 8.1. Collection of Money. Except as otherwise
expressly provided herein, the Indenture Trustee may demand payment or delivery 
of, and shall receive and collect, directly and without intervention or         
assistance of any fiscal agent or other intermediary, all money and other       
property payable to or receivable by the Indenture Trustee pursuant to this     
Indenture. The Indenture Trustee shall apply all such money received by it as   
provided in this Indenture. Except as otherwise expressly provided in this      
Indenture or in the Sale and Servicing Agreement, if any default occurs in the  
making of any payment or performance under any agreement or instrument that is  
part of the Trust Property, the Indenture Trustee may take such action as may be
appropriate to enforce such payment or performance, including the institution   
and prosecution of appropriate proceedings.                                     

          SECTION 8.2. Release of Trust Property. (a) Subject to
Section 8.9 and the payment of its fees and expenses pursuant to Section 6.7,   
the Indenture Trustee may, and when required by the Issuer and the provisions of
this Indenture shall, execute instruments to release property from the lien of  
this Indenture, in a manner and under circumstances that are not inconsistent   
with the provisions of this Indenture or the Sale and Servicing Agreement. No   
party                                                                           

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relying upon an instrument executed by the Indenture Trustee as provided in this
Article VIII shall be bound to ascertain the Indenture Trustee's authority,     
inquire into the satisfaction of any conditions precedent or see to the         
application of any monies. The Indenture Trustee may require as a condition to  
any such release, an Opinion of Counsel, stating the legal effect of any such   
action, outlining the steps required to complete the same, and concluding that  
all conditions precedent to the taking of such action have been complied with   
and such action will not materially and adversely impair the security for the   
Notes or the rights of the Noteholders or the Insurer in contravention of the   
provisions of this Indenture; provided, however, that such Opinion of Counsel   
shall not be required to express an opinion as to the fair value of the Trust   
Property. Counsel rendering any such opinion may rely, without independent      
investigation, on the accuracy and validity of any certificate or other         
instrument delivered to the Indenture Trustee in connection with any such       
release.                                                                        

                 (b) The Indenture Trustee shall, at such time as there are no
Notes outstanding and all sums due the Indenture Trustee pursuant to Section 6.7
and to the Insurer pursuant to the Insurance Agreement have been paid, release  
any remaining portion of the Trust Property that secured the Notes from the lien
of this Indenture and release to the Issuer or any other Person entitled thereto
any funds then on deposit in the Trust Accounts.                                

                  (c) The Indenture Trustee shall release property from the lien
of this Indenture pursuant to this Section 8.2 only upon receipt of an Issuer   
Request accompanied by an Officer's Certificate, an Opinion of Counsel and (if  
required by the TIA) Independent Certificates in accordance with TIA ss.ss.     
314(c) and 314(d)(1) meeting the applicable requirements of Section 12.1.       

          SECTION 8.3. Payments. (a) On each Payment Date, after
withdrawing amounts owed pursuant to Section 6.7 and Section 8.7(c) and amounts 
owed to the Owner Trustee under Section 12.1 of the Trust Agreement, the        
Indenture Trustee or the Note Paying Agent, as the case may be, shall, based    
solely on information contained in the Remittance Report for such Payment Date, 
withdraw from the Distribution Account an amount equal to the Available         
Distribution Amount for each Class and pay to the following Persons the         
following amounts, in the following order of priority:                          

                 (i) first, to the payment of the Interest Distribution Amount
    (other than the Shortfall Interest Deferred Amount and the Accrued
   Shortfall Interest Carry Forward Amount) for the related Class of
Notes;                                                        

      (ii) second, to the payment of the unpaid Interest
        Distribution Amount (other than the Shortfall Interest Deferred Amount
        and the Accrued Shortfall Interest Carry Forward Amount) for the other
Class of Notes;                                               

               (iii) third, to the Insurer, any amounts due to the Insurer
       with respect to the Notes under the terms of the Insurance Agreement;

                  (iv) fourth, to the payment of the Base Principal Distribution
Amount for the related Class of Notes;                        

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                 (v) fifth, to the Holders of the related Class of Notes, as a
       payment of such Class' allocable portion of the Overcollateralization
Deficit, if any;                                              

                (vi) sixth, to the Holders of the other Class of Notes, as a
payment of such other Class' allocable portion of the         
         Overcollateralization Deficit, if any, to the extent that the Available
      Distribution Amount for such other Class is insufficient to pay such
portion;                                                      

                (vii) seventh, to the Holders of the related Class of Notes,
an amount equal to the Overcollateralization Increase Amount; 

               (viii) eighth, to the Reserve Account, to the extent of any
shortfall in the payment of the full amount of the            
     Overcollateralization Increase Amount for the other Class of Notes;

                 (ix) ninth, to the Holders of the Notes, to the extent of any
  shortfall in the payment of the full amount of Accrued Shortfall
Interest Carry Forward Amount on a pro rata basis;            

            (x) tenth, if the Back-up Servicer shall have become the
Servicer hereunder, to the Back-up Servicer, the amount of any
Compensating Interest advanced by the Back-up Servicer;       

       (xi) eleventh, to the Trust for distribution to the
Certificateholder;                                            

Funds distributed to the Certificateholder pursuant to clause (xi) above shall  
be free and clear of the lien of this Indenture.                                

                 Distributions in respect of the Certificate shall be made (i)
by wire transfer of immediately available funds to the account of the           
Certificateholder at a bank or other entity having appropriate facilities       
therefor, provided that the Certificateholder shall have notified the Indenture 
Trustee in writing at least five Business Days prior to the relevant Record     
Date, and (ii) if the Certificateholder shall have failed to give the           
notification referred to in clause (i), by check mailed by first class mail to  
the address of such Holder appearing in the Certificate Register. The Indenture 
Trustee may deduct a reasonable wire transfer fee from any payment made by wire 
transfer. The final distribution on the Certificate will be made in like manner,
but only upon presentment and surrender of the Certificate to the Certificate   
Registrar.                                                                      

                 Prior to the final distribution hereunder with respect to the
Certificate, the Indenture Trustee shall mail to the Certificateholder a notice 
to the effect that the Indenture Trustee expects that the final distribution    
with respect to the Certificate will be made on a specific date but only upon   
presentation and surrender of the Certificate at the office of the Certificate  
Registrar therein specified.                                                    

               (b) In addition to making the payments required pursuant to
Section 8.3(a), on each Payment Date for which there exists a Deficiency Amount 
for a Class of Notes, the Indenture Trustee shall withdraw from the Distribution
Account any amount therein that was transferred from the Policy Payments Account
to the Distribution Account pursuant to Section                                 

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11.4 and pay to the Holders of that Class (i) an amount equal to any amount     
required to be paid pursuant to Section 8.3(a)(i) for such Payment Date         
remaining unpaid after giving effect to all payments made pursuant to Section   
8.3(a) for such Payment Date, (ii) an amount equal to any Remaining             
Overcollateralization Deficit for such Class on such Payment Date after giving  
effect to all distributions made pursuant to Section 8.3(a) for such Payment    
Date and (iii) without duplication, any other amount constituting a Deficiency  
Amount for such Class.                                                          

           (c) All payments made with respect to the Notes on each
Payment Date shall be allocated, pro rata among the outstanding Notes, and on   
their respective Note Principal Balances.                                       

                  (d) Payments in respect of the Notes on each Payment Date will
be made to the Holders of record on the related Record Date (except as otherwise
provided in Section 8.3(f) and Article X respecting the final distribution on   
the Notes), based on the aggregate Note Principal Balance evidenced by their    
respective Notes. So long as the Book-Entry Notes are registered in the name of 
the Depository or its nominee, the Indenture Trustee shall make all payments on 
such Notes by wire transfers of immediately available funds to the Depository or
its nominee. In the case of Notes issued in fully registered, certificated form,
payments shall be made by wire transfer of immediately available funds to the   
account of any such Holder at a bank or other entity having appropriate         
facilities therefor, if such Holder shall have so notified the Indenture Trustee
in writing at least five Business Days prior to the Record Date immediately     
prior to such Payment Date and is the registered owner of Notes having an       
initial aggregate Note Principal Balance in excess of $5,000,000, or otherwise  
by check mailed by first class mail to the address of such Holder appearing in  
the Note Register. The Indenture Trustee may deduct a reasonable wire transfer  
fee from any payment made by wire transfer. The final payment on each Note will 
be made in like manner, but only upon presentment and surrender of such Note at 
the Corporate Trust Office or such other location specified in the notice to    
Noteholders of such final distribution. Payments to the Insurer on any Payment  
Date will be made by wire transfer of immediately available funds to the account
designated by the Insurer. Funds represented by any such checks returned        
undelivered shall be held in accordance with Section 3.3.                       

                Each payment with respect to a Book-Entry Note shall be paid
to the Depository, as Holder thereof, and the Depository shall be responsible   
for crediting the amount of such distribution to the accounts of its Depository 
Participants in accordance with its normal procedures. Each Depository          
Participant shall be responsible for disbursing such payment to the Note Owners 
that it represents and to each indirect participating brokerage firm (a         
"brokerage firm" or "indirect participating firm") for which it acts as agent.  
Each brokerage firm shall be responsible for disbursing funds to the Note Owners
that it represents. None of the Indenture Trustee, the Note Registrar, the      
Depositor or the Servicer shall have any responsibility therefor except as      
otherwise provided by this Agreement or applicable law.                         

            (e) The rights of the Noteholders to receive payments in
respect of the Notes, and all interests of the Noteholders in such              
distributions, shall be as set forth in this Indenture. Neither the Holders of  
the Notes nor the Issuer, Insurer, Indenture Trustee, Unaffiliated Seller or    
Servicer shall in any way be responsible or liable to the Holders of any other  
Notes in respect of amounts properly previously paid on the Notes.              

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             (f) Whenever the Indenture Trustee expects that the Final
Payment Date with respect to the Notes will occur on the next Payment Date, the 
Indenture Trustee shall mail to each Holder on the such Class of Notes and to   
the Insurer a notice to the effect that:                                        

                 (i) the Indenture Trustee expects that the final payment with
      respect to the Notes will be made on such Payment Date but only upon
         presentation and surrender of such Notes at the office of the Indenture
Trustee therein specified;                                    

                  (ii) no interest shall accrue on such Notes from and after the
end of the related Interest Accrual Period.                   

                  Such notice shall be given by the Indenture Trustee (a) in the
event such notice is given in connection with a redemption of the Notes pursuant
to Article X, not earlier than the 10th day and not later than the 15th day of  
the month next preceding the Redemption Date or (b) otherwise, during the month 
of such Final Payment Date on or before the Determination Date in respect of    
such Final Payment Date.                                                        

               Any funds not paid to any Holder or Holders of Notes on the
related Final Payment Date because of the failure of such Holder or Holders to  
tender their Notes shall, on such date, be set aside and held in trust and      
credited to the account of the appropriate non-tendering Holder or Holders. If  
any Note as to which notice has been given pursuant to this Section 8.3(f) shall
not have been surrendered for cancellation within six months after the time     
specified in such notice, the Indenture Trustee shall mail a second notice to   
the remaining non-tendering Noteholders to surrender their Notes for            
cancellation in order to receive the final distribution with respect thereto. If
within one year after the second notice all such Notes shall not have been      
surrendered for cancellation, the Indenture Trustee shall, directly or through  
an agent, contact the remaining non-tendering Noteholders concerning surrender  
of their Notes in the manner reasonably specified to the Indenture Trustee by   
the Servicer in writing. The costs and expenses of maintaining the funds in     
trust and of contacting such Noteholders shall be paid out of the assets so held
in trust for such Noteholders. If in one year after the second notice any such  
Notes shall not have been surrendered for cancellation, the Servicer shall pay  
to the Insurer any amount of such funds that were paid by the Insurer under the 
Policy but shall continue to hold any remaining funds for the benefit of the    
non-tendering Noteholders, and such Noteholders shall thereafter look solely to 
the Servicer for payment thereof, and all liability of the Insurer with respect 
to such Trust Properties shall thereupon cease. No interest shall accrue or be  
payable to any Noteholder on any amount held in trust by the Servicer as a      
result of such Noteholder's failure to surrender its Note(s) for final payment  
thereof in accordance with this Section 8.3(f).                                 

(g) [Reserved]                              

          SECTION 8.4. Compliance with Withholding Requirements.
Notwithstanding any other provision of this Agreement, the Indenture Trustee    
shall comply with all federal withholding requirements respecting payments to   
Noteholders of interest or original issue discount that the Indenture Trustee   
reasonably believes are applicable under the Code. The consent of Noteholders   
shall not be required for such withholding. In the event the Indenture Trustee  
does withhold any amount from interest or original issue discount payments or   
advances                                                                        

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thereof to any Noteholder pursuant to federal withholding requirements, the     
Indenture Trustee shall indicate the amount withheld to such Noteholders.       

             SECTION 8.5. Statements to Noteholders. Concurrently with
each payment to Noteholders on any Payment Date, the Indenture Trustee shall    
forward to each Noteholder, the Servicer, the Insurer and each Rating Agency the
statement prepared by the Servicer pursuant to Section 4.02 of the Sale and     
Servicing Agreement with respect to such payment.                               

            To the extent that there are inconsistencies between the
telecopy of the Remittance Report and the hard copy thereof and information set 
forth in the computer tape or other media provided by the Servicer under the    
Sale and Servicing Agreement, the Indenture Trustee shall be entitled to rely   
upon the telecopy.                                                              

            Within a reasonable period of time after the end of each
calendar year, the Indenture Trustee shall forward to each Person who at any    
time during the calendar year was a Holder of Notes (a) the statement furnished 
to the Indenture Trustee by the Servicer pursuant to Section 4.02 of the Sale   
and Servicing Agreement containing the information set forth in clauses (1)     
through (3) of Section 4.02 of the Sale and Servicing Agreement, aggregated for 
such calendar year or applicable portion thereof during which such person was a 
Noteholder and (b) such information contained in the Remittance Reports as      
required to enable the Holders of the Notes to prepare their tax returns.       

             Upon request, the Indenture Trustee shall forward to each
Noteholder, during the term of this Indenture, such periodic, special, or other 
reports or information, whether or not provided for herein, as shall be         
reasonably requested with respect to the Noteholder, or otherwise with respect  
to the purposes of this Indenture, all such reports or information to be        
prepared by the Servicer and provided at the expense of the Noteholder in       
accordance with such reasonable and explicit instructions and directions as the 
Noteholder may provide. For purposes of this Section 8.5, the Indenture         
Trustee's duties are limited to the extent that the Indenture Trustee receives  
timely reports as required from the Servicer.                                   

                 SECTION 8.6. Rights of Noteholders. The Notes shall represent
obligations of the Issuer, secured by the Trust Property, including the Trust   
Accounts and the right to receive interest, principal and other amounts at the  
times and in the amounts specified in this Indenture.                           

        SECTION 8.7. Distribution Account. (a) The Indenture
Trustee shall establish and maintain with itself a separate trust account (the  
"Distribution Account") entitled "First Union National Bank as Indenture        
Trustee, in trust for (A) the registered holders of HomeGold Home Equity Loan   
Trust 1999-1 Asset Backed Notes, Series 1999-1, and (B) Financial Security      
Assurance Inc., Distribution Account". The Distribution Account shall be an     
Eligible Account. Deposits to and withdrawals from the Distribution Account     
shall be made as provided herein and in the Sale and Servicing Agreement. Funds 
in the Distribution Account shall be invested in Permitted Investments, at the  
direction of the Servicer, in accordance with Section 8.12 hereof. The Indenture
Trustee shall give notice to the Issuer, the Servicer and the Insurer of the    
location of the Distribution Account when established and prior to any change   
thereof.                                                                        

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               (b) Promptly upon receipt of any Stayed Funds, whether from
the Servicer, a trustee in bankruptcy, or federal bankruptcy court or other     
source, the Indenture Trustee shall deposit such funds in the Distribution      
Account, subject to withdrawal thereof pursuant to Section 7.02(b) of the Sale  
and Servicing Agreement or as otherwise permitted thereunder.                   

           (c) The Indenture Trustee shall be entitled to withdraw
amounts from the Distribution Account and to transfer funds to the Expense      
Account on the Business Day immediately preceding each Payment Date pursuant to 
Section 8.10(b) prior to any payments as required pursuant to Section 8.3.      

              (d) If, at the close of business on the third Business Day
prior to any Payment Date, the funds on deposit in the Distribution Account are 
less than the Scheduled Payment for such Payment Date, the Indenture Trustee    
shall give notice by telephone or telecopy of the amount of such deficiency,    
confirmed in writing in the form set forth as Exhibit A to the Policy, to the   
Insurer and the Fiscal Agent (as defined in the Policy), if any, at or before   
10:00 a.m., New York time, on the second Business Day prior to such Payment     
Date.                                                                           

SECTION 8.8. [Reserved]                     

SECTION 8.9. [Reserved]                     

            SECTION 8.10. Expense Account. (a) The Indenture Trustee
shall establish and maintain with itself a separate trust account (the "Expense 
Account") entitled "First Union National Bank as Indenture Trustee, in trust for
(A) the registered holders of HomeGold Home Equity Loan Trust 1999-1 Asset      
Backed Notes, Series 1999-1, and (B) Financial Security Assurance Inc., Expense 
Account." The Expense 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.                                                

              (b) On the Business Day immediately preceding each Payment
Date, the Indenture Trustee shall withdraw from the Distribution Account and    
deposit into the Expense Account an amount equal to the product of (i) l/12 of  
the Insurer Premium Rate and (ii) the Class A Note Principal Balance after      
giving effect to distributions of principal on such Payment Date. Such amount so
withdrawn from the Distribution Account shall reduce the Available Distribution 
Amount for each Group pro rata, based upon the relative proportions of the Class
A-1 Note Principal Balance and the Class A-2 Note Principal Balance to the total
Class A Note Principal Balance (in such case after giving effect to             
distributions of principal on such Payment Date).                               

             (c) The Indenture Trustee shall make withdrawals from the
Expense Account to pay the Insurer Premium on each Payment Date.                

         (d) Funds in the Expense Account shall be invested in
Permitted Investments, at the direction of the Servicer, in accordance with     
Section 8.12 hereof. The Indenture Trustee shall give notice to the Issuer, the 
Servicer and the Insurer of the location of the Expense Account on the Closing  
Date and prior to any change thereof.                                           

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                (e) Upon payment in full of the principal of and interest on
the Notes and any amounts due the Insurer under the Insurance Agreement, any    
amounts remaining in the Expense Account following the payment of all unpaid    
Insurer Premiums shall be released to the Servicer as additional servicing      
compensation.                                                                   

            SECTION 8.11. Reserve Account. (a) The Indenture Trustee
shall establish and maintain with itself a separate trust account (the "Reserve 
Account") entitled "First Union National Bank as Indenture Trustee, in trust for
(A) the registered holders of HomeGold Home Equity Loan Trust 1999-1 Asset      
Backed Notes, Series 1999-1, and (B) Financial Security Assurance Inc., Reserve 
Account." The Reserve 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.                                                

                  (b) On each Payment Date, the Indenture Trustee shall withdraw
from the Distribution Account and deposit into the Reserve Account the amounts  
if any, described in Section 8.3(a)(viii) hereof. In addition, in the event that
the Servicer exercises its option to call one Class of Notes, the Servicer shall
deliver to the Trustee, and the Trustee shall deposit to the Reserve Account,   
the full amount of the Overcollateralization Deficiency, if any, with respect to
the still-outstanding Class of Notes, calculated as of the date on which the    
Servicer exercises such option.                                                 

                 (c) If, on any Payment Date, and after applying the Available
Distribution Amount for each Class as described on Section 8.3 hereof, either   
Class has not received the full amount of its Interest Distribution Amount      
(other than the Shortfall Interest Deferred Amount and the Accrued Shortfall    
Interest Carry Forward Amount) or its allocable portion of any                  
Overcollateralization Deficit, the Trustee shall withdraw the amount of any such
insufficiency from the Reserve Account and apply it to the payment of such      
shortfall; if the aggregate amount of such insufficiency on a Payment Date      
exceeds the amount available in the Reserve Account, the Trustee shall apply    
such amount as is available in the Reserve Account as directed by the Insurer;  

         (d) Funds in the Reserve Account shall be invested in
Permitted Investments, at the direction of the Servicer, in accordance with     
Section 8.12 hereof. The Indenture Trustee shall give notice to the Issuer, the 
Servicer and the Insurer of the location of the Reserve Account on the Closing  
Date and prior to any change thereof;                                           

                 (e) If, on any Payment Date, and after applying the Available
Distribution Amount for each class, as described in Section 8.3 hereof, and     
after making any withdrawal from the Reserve Account pursuant to Clause (c)     
above, (A) the sum of (x) the Overcollateralization Amount for both classes of  
Notes plus (y) the amount remaining in the Reserve Account exceeds (B) the      
Specified Overcollateralization Amount for both classes of Notes for such       
Payment Date, the Trustee shall release to the Certificateholders the lesser of 
(i) such excess, or (ii) the amount then on deposit on the Reserve Account;     

                (f) Upon payment in full of the principal of and interest on
the Notes and any amounts due the Insurer under the Insurance Agreement, any    
amounts remaining in the Reserve                                                

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Account following the payment of all unpaid Insurer Premiums shall be released  
to the Certificateholder.                                                       

           SECTION 8.12. Investment of Funds. (a) The Servicer may
direct the Indenture Trustee to invest funds in the Collection Account, the     
Distribution Account, the Reserve Account and the Expense Account (each, for    
purposes of this Section 8.12, an "Investment Account"), to invest the funds in 
such Investment Account in one or more Permitted Investments bearing interest or
sold at a discount, and maturing, unless payable on demand, (i) no later than   
the Business Day immediately preceding the next Payment Date, if a Person other 
than the Indenture Trustee is the obligor thereon, and (ii) no later than the   
next Payment Date, if the Indenture Trustee is the obligor thereon. All such    
Permitted Investments shall be held to maturity, unless payable on demand. Any  
investment of funds in an Investment Account shall be made in the name of the   
Indenture Trustee (in its capacity as such) or in the name of a nominee of the  
Indenture Trustee. The Indenture Trustee shall be entitled to sole possession   
over each such investment and the income thereon, and any certificate or other  
instrument evidencing any such investment shall be delivered directly to the    
Indenture Trustee or its agent, together with any document of transfer necessary
to transfer title to such investment to the Indenture Trustee or its nominee. In
the event amounts on deposit in an Investment Account are at any time invested  
in a Permitted Investment payable on demand, the Indenture Trustee shall at the 
direction of the Servicer:                                                      

      (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 promptly upon
              determination by a Responsible Officer that such Permitted
             Investment would not constitute a Permitted Investment in
            respect of funds thereafter on deposit in the Investment
Account.                                    

                 (b) All income and gain realized from the investment of funds
deposited in the Collection Account, the Expense Account, the Distribution      
Account and the Servicing Accounts held by or on behalf of the Servicer or the  
Indenture Trustee, shall be for the benefit of the Servicer and shall be subject
to its withdrawal in accordance with Section 3.11 of the Sale and Servicing     
Agreement or remitted to the Servicer pursuant to this Section. Pursuant to     
Section 3.14(b) of the Sale and Servicing Agreement, the Servicer shall be      
obligated to deposit in the Collection Account, the Expense Account or the      
Distribution Account, as applicable, the amount of any loss incurred in respect 
of any such Permitted Investment made with funds in such accounts immediately   
upon realization of such loss.                                                  

                 (c) 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 Indenture Trustee may and, subject to Article VI, upon
the request of the Insurer, shall, take such action as may be appropriate to    
enforce such payment or performance, including the institution and prosecution  
of appropriate Proceedings.                                                     

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ARTICLE IX

 Supplemental Indentures

           SECTION 9.1. Supplemental Indentures Without Consent of
Noteholders. (a) Without the consent of the Holders of any Notes but with       
the consent of the Insurer, as evidenced to the Indenture Trustee, the Issuer   
and the Indenture Trustee, when authorized by an Issuer Order, at any time and  
from time to time, may enter into one or more indentures supplemental hereto    
(which shall conform to the provisions of the Trust Indenture Act as in force at
the date of the execution thereof), in form satisfactory to the Indenture       
Trustee, for any of the following purposes:                                     

                (i) to correct or amplify the description of any property at
      any time subject to the lien of this Indenture, or better to assure,
       convey and confirm unto the Indenture Trustee any property subject or
       required to be subjected to the lien of this Indenture, or to subject
to the lien of this Indenture additional property;            

           (ii) to evidence the succession, in compliance with the
        applicable provisions hereof, of another person to the Issuer, and the
        assumption by any such successor of the covenants of the Issuer herein
and in the Notes contained;                                   

                (iii) to add to the covenants of the Issuer, for the benefit
        of the Holders of the Notes, or to surrender any right or power herein
conferred upon the Issuer;                                    

            (iv) to convey, transfer, assign, mortgage or pledge any
property to or with the Indenture Trustee;                    

           (v) to cure any ambiguity, to correct or supplement any
provision herein or in any supplemental indenture which may be
     inconsistent with any other provision herein or in any supplemental
      indenture or to make any other provisions with respect to matters or
questions arising under this Indenture or in any supplemental 
     indenture; provided that such action shall not adversely affect the
interests of the Holders of the Notes or the Insurer;         

          (vi) to evidence and provide for the acceptance of the
        appointment hereunder by a successor trustee with respect to the Notes
    and to add to or change any of the provisions of this Indenture as
   shall be necessary to facilitate the administration of the trusts
     hereunder by more than one trustee, pursuant to the requirements of
Article VI; or                                                

               (vii) to modify, eliminate or add to the provisions of this
Indenture to such extent as shall be necessary to effect the  
    qualification of this Indenture under the TIA or under any similar
     federal statute hereafter enacted and to add to this Indenture such
other provisions as may be expressly required by the TIA.     

             The Indenture Trustee is hereby authorized to join in the
execution of any such supplemental indenture and to make any further appropriate
agreements and stipulations that may be therein contained.                      

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                (b) The Issuer and the Indenture Trustee, when authorized by
an Issuer Order, may, also without the consent of any of the Holders of the     
Notes but with the prior written consent of the Insurer and with prior notice to
the Rating Agencies by the Issuer, as evidenced to the Indenture Trustee, enter 
into an indenture or indentures supplemental hereto for the purpose of adding   
any provisions to, or changing in any manner or eliminating any of the          
provisions of, this Indenture or of modifying in any manner the rights of the   
Holders of the Notes under this Indenture; provided, however, that such action  
shall not, as evidenced by a written confirmation from the Rating Agencies that 
such action will not adversely affect the then current ratings on the Notes     
without taking into account the Policy, adversely affect in any material respect
the interests of any Noteholder or the Insurer.                                 

                SECTION 9.2. Supplemental Indentures with Consent of Insurer
or Noteholders. The Issuer and the Indenture Trustee, when authorized by an     
Issuer Order, also may, with prior notice to the Rating Agencies, with the      
consent of the Insurer (or, if an Insurer Default has occurred and is           
continuing, the Holders of the Notes evidencing a majority of the Outstanding   
Amount of both Classes of Notes, by Act of such Holders delivered to the Issuer 
and the Indenture Trustee), enter into an indenture or indentures supplemental  
hereto for the purpose of adding any provisions to, or changing in any manner or
eliminating any of the provisions of, this Indenture or of modifying in any     
manner the rights of the Holders of the Notes under this Indenture; provided,   
however, that, subject to the express rights of the Insurer under the Basic     
Documents, no such supplemental indenture shall, without the consent of the     
Holder of each Outstanding Note affected thereby:                               

                  (i) change the date of payment of any installment of principal
         of or interest on any Note, or reduce the principal amount thereof, the
         interest rate thereon or the amounts payable upon any redemption of the
Notes, change the provision of this Indenture relating to the 
    application of collections on, or the proceeds of the sale of, the
        Trust Property to payment of principal of or interest on the Notes, or
      change any place of payment where, or the coin or currency in which,
any Note or the interest thereon is payable;                  

                  (ii) impair the right to institute suit for the enforcement of
     the provisions of this Indenture requiring the application of funds
     available therefor, as provided in Article V, to the payment of any
   such amount due on the Notes on or after the respective due dates
    thereof (or, in the case of redemption, on or after the Redemption
Date);                                                        

                (iii) reduce the percentage of the Holders of Notes entitled
       to Voting Rights required for any such supplemental indenture, or for
       any waiver of compliance with certain provisions of this Indenture or
        certain defaults hereunder and their consequences provided for in this
Indenture;                                                    

             (iv) modify or alter the provisions of the proviso to the
definition of the term "Outstanding";                         

              (v) reduce the percentage of the Holders of Notes entitled
to Voting Rights required to authorize a private sale of Trust
Property as contemplated in Section 5.19(b);                  

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                (vi) modify any provision of this Section except to increase
       any percentage specified herein or to provide that certain additional
        provisions of this Indenture or the Basic Documents cannot be modified
 or waived without the consent of the Insurer and Holder of each
Outstanding Note affected thereby;                            

                (vii) modify any of the provisions of this Indenture in such
     manner as to affect the calculation of the amount of any payment of
      interest or principal due on any Note on any Payment Date (including
the calculation of any of the individual components of such   
calculation); or                                              

          (viii) permit the creation of any lien (other than the
      Warehouse Liens to be discharged and released as provided in Section
     3.5 and 3.12) ranking prior to or on a parity with the lien of this
        Indenture with respect to any part of the Trust Property or, except as
   otherwise permitted or contemplated herein or in any of the Basic
        Documents, terminate the lien of this Indenture on any property at any
         time subject hereto or deprive the Holder of any Note or the Insurer of
the security provided by the lien of this Indenture.          

                The Indenture Trustee may determine whether or not any Notes
would be adversely affected by any supplemental indenture upon receipt of       
written confirmation from the Rating Agencies that such action will not         
adversely effect the then current ratings on the Notes without taking into      
account the Policy and any such determination shall be conclusive upon the      
Holders of all Notes, whether theretofore or thereafter authenticated and       
delivered hereunder. The Indenture Trustee shall not be liable for any such     
determination made in good faith.                                               

              It shall not be necessary for any Act of Noteholders under
this Section to approve the particular form of any proposed supplemental        
indenture, but it shall be sufficient if such Act shall approve the substance   
thereof.                                                                        

                Promptly after the execution by the Issuer and the Indenture
Trustee of any supplemental indenture pursuant to this Section, the Indenture   
Trustee shall mail to the Insurer and the Holders of the Notes to which such    
amendment or supplemental indenture relates a notice setting forth in general   
terms the substance of such supplemental indenture. Any failure of the Indenture
Trustee to mail such notice, or any defect therein, shall not, however, in any  
way impair or affect the validity of any such supplemental indenture.           

         SECTION 9.3. Execution of Supplemental Indentures. In
executing, or permitting the additional trusts created by, any supplemental     
indenture permitted by this Article IX or the modifications thereby of the      
trusts created by this Indenture, the Indenture Trustee shall be entitled to    
receive, and subject to Sections 6.1 and 6.2, shall be fully protected in       
relying upon, an Opinion of Counsel (and, if requested, an Officer's            
Certificate) stating that the execution of such supplemental indenture is       
authorized or permitted by this Indenture. The Indenture Trustee may, but shall 
not be obligated to, enter into any such supplemental indenture that affects the
Indenture Trustee's own rights, duties, liabilities or immunities under this    
Indenture or otherwise.                                                         

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           SECTION 9.4. Effect of Supplemental Indenture. Upon the
execution of any supplemental indenture pursuant to the provisions hereof, this 
Indenture shall be and be deemed to be modified and amended in accordance       
therewith with respect to the Notes affected thereby, and the respective rights,
limitations of rights, obligations, duties, liabilities and immunities under    
this Indenture of the Indenture Trustee, the Issuer and the Holders of the Notes
shall thereafter be determined, exercised and enforced hereunder subject in all 
respects to such modifications and amendments, and all the terms and conditions 
of any such supplemental indenture shall be and be deemed to be part of the     
terms and conditions of this Indenture for any and all purposes.                

           SECTION 9.5. Conformity With Trust Indenture Act. Every
amendment of this Indenture and every supplemental indenture executed pursuant  
to this Article IX shall conform to the requirements of the Trust Indenture Act 
as then in effect so long as this Indenture shall then be qualified under the   
Trust Indenture Act.                                                            

               SECTION 9.6. Reference in Notes to Supplemental Indentures.
Notes authenticated and delivered after the execution of any supplemental       
indenture pursuant to this Article IX may, and if required by the Indenture     
Trustee shall, bear a notation in form approved by the Indenture Trustee as to  
any matter provided for in such supplemental indenture. If the Issuer or the    
Indenture Trustee shall so determine, new Notes so modified as to conform, in   
the opinion of the Indenture Trustee and the Issuer, to any such supplemental   
indenture may be prepared and executed by the Issuer and authenticated and      
delivered by the Indenture Trustee in exchange for Outstanding Notes.           

ARTICLE X 

 Redemption of Notes

             SECTION 10.1. Redemption. (a) The Servicer shall have the
option to cause either Class of Notes to be redeemed, in whole but not in part, 
at the Redemption Price, on any Payment Date after which the Note Principal     
Balance of the related Class is less than 10% of the Note Principal Balance of  
such Class as of the Closing Date. Notice of the exercise of the redemption     
option pursuant to this Section 10.01(a) shall be given by the Issuer to the    
Indenture Trustee and the Insurer not later than the 5th day of the month       
immediately preceding the Redemption Date. In order to exercise its redemption  
hereunder, the Servicer must purchase the Mortgage Loans in the related Group   
and related REO Property as provided in Section 10.02(a) of the Sale and        
Servicing Agreement and pay the price specified in such Section 10.02(a)        
therefor.                                                                       

(b) [Reserved].                             

             (c) The Issuer shall fund any redemption pursuant to this
Article X through sales of Mortgage Loans in the related Group and other        
properties in accordance with Article X of the Sale and Servicing Agreement. The
Issuer is also authorized and shall be permitted to sell Mortgage Loans and     
other properties as provided in Section 10.02 of the Sale and Servicing         
Agreement, whether or not in connection with a redemption of the Notes pursuant 
to this Article X.                                                              

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                SECTION 10.2. Notice. Notice of any redemption of a Class of
Notes pursuant to this Article X shall be given to Noteholders by the Indenture 
Trustee in accordance with Section 8.3(f).                                      

                  SECTION 10.3. Presentation and Surrender of Notes and Payment.
The provisions of Section 8.3(f) shall apply with respect to the presentation   
and surrender of Notes for payment and the consequences of any failure to       
present or surrender any Note for payment in connection with a redemption       
pursuant to this Article X. Upon presentation and surrender of any Note in      
connection with a redemption pursuant to this Article X as contemplated in this 
Article X and Section 8.3(f), the Indenture Trustee shall pay to the Noteholder 
in respect of such Note the Redemption Price.                                   

ARTICLE XI

 Certain Matters Regarding the Insurer

             SECTION 11.1. Rights of the Insurer to Exercise Rights of
Class A Noteholders. The Indenture Trustee and, by accepting any Note, each     
Class A Noteholder, agrees that unless an Insurer Default has occurred and is   
continuing, the Insurer shall have the right to exercise all rights of the Class
A Noteholders under this Indenture and the Sale and Servicing Agreement         
(including all Voting Rights) (except as provided in Section 9.2 and except as  
otherwise expressly required by the TIA) without any further consent of the     
Class A Noteholders, including, without limitation the rights enumerated in     
Sections 5.2, 5.12, 5.19, 5.20 and 6.13 of this Indenture and, so long as no    
Insurer Default shall have occurred and be continuing, the consent of the       
Insurer to any action or matter (except as provided in Section 9.2) shall be    
deemed to also constitute the consent of the requisite percentage of Noteholders
required by this Indenture or the Sale and Servicing Agreement in respect of    
such action or matter. In addition, each Class A Noteholder agrees that, unless 
an Insurer Default has occurred and is continuing, the rights referred to above 
may be exercised by the Class A Noteholders only with the prior written consent 
of the Insurer.                                                                 

                 SECTION 11.2. Indenture Trustee to Act Solely with Consent of
the Insurer. Unless an Insurer Default has occurred and is continuing, the      
Indenture Trustee shall not:                                                    

            (a) agree to any amendment of this Indenture pursuant to
Section 9.1 or 9.2 hereof or of the Sale and Servicing Agreement pursuant to    
Section 12.01 thereof;                                                          

                 (b) undertake any litigation pursuant to Section 6.19 of this
Indenture; or                                                                   

              (c) terminate the Servicer pursuant to Section 7.01 of the
Sale and Servicing Agreement,                                                   

without the prior written consent of the Insurer which consent shall not be     
unreasonably withheld.                                                          

                 SECTION 11.3. Trust Property and Accounts Held for Benefit of
the Insurer. The Indenture Trustee shall hold the Trust Property and the        
Mortgage Files for the benefit of the Noteholders and the Insurer and all       
references in this Indenture and in the Notes to the benefit of                 

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Holders of the Notes shall be deemed to include the Insurer unless an Insurer   
default has occurred and is continuing. The Indenture Trustee shall cooperate in
all reasonable respects with any reasonable request by the Insurer for action to
preserve or enforce the Insurer's rights or interests under this Indenture and  
the Notes.                                                                      

                  SECTION 11.4. Claims Upon the Policy; Policy Payments Account.
(a) If, by the close of business on the third Business Day prior to a Payment   
Date, the Indenture Trustee determines, based on the Remittance Report, that a  
Deficiency Amount for any Payment Date is greater than zero, then the Indenture 
Trustee shall give notice to the Insurer by telephone or telecopy of the amount 
of such Deficiency Amount. Such notice of such Deficiency Amount shall be       
confirmed in writing in the form set forth as Exhibit A to the Policy to the    
Insurer and the Fiscal Agent (as defined in the Policy), if any, at or before   
10:00 a.m., New York time, on the second Business Day prior to such Payment     
Date. Following receipt by the Insurer of such notice in such form, the Insurer 
will pay any amount payable under the Policy on the later to occur of (i) 12:00 
noon, New York time, on the second Business Day following such receipt and (ii) 
12:00 noon, New York time, on the Payment Date to which such deficiency relates,
as provided in Exhibit A to the Policy.                                         

              (b) The Indenture Trustee shall establish separate special
purpose trust accounts for the benefit of Holders of each Class of Notes and the
Insurer referred to herein as the "Policy Payments Accounts" over which the     
Indenture Trustee shall have exclusive control and sole right of withdrawal. The
Indenture Trustee shall deposit any amount paid under the Policy in the Policy  
Payments Accounts and distribute such amount only for purposes of payment to    
Holders of Class A Notes of the Scheduled Payment for which a claim was made and
such amount may not be applied to satisfy any costs, expenses or liabilities of 
the Servicer, the Indenture Trustee or the Issuer. Amounts paid under the Policy
shall be transferred to the Distribution Account in accordance with the next    
succeeding paragraph and disbursed by the Indenture Trustee to Holders of the   
applicable Class of Class A Notes in accordance with Section 8.3(b) or Article  
X, as applicable. It shall not be necessary for such payments to be made by     
checks or wire transfers separate from the checks or wire transfers used to pay 
the Scheduled Payment with other funds available to make such payment. However, 
the amount of any payment of principal of or interest on the applicable Class of
Class A Notes to be paid from funds transferred from the Policy Payments Account
shall be noted as provided in paragraph (c) below in the Note Register and in   
the statement to be furnished to Holders of the applicable Class of Class A     
Notes pursuant to Section 8.5. Funds held in the Policy Payments Account shall  
not be invested.                                                                

              On any Payment Date with respect to which a claim has been
made under the Policy, the amount of any funds received by the Indenture Trustee
as a result of any claim under the Policy, to the extent required to make the   
Scheduled Payment on such Payment Date, shall be withdrawn from the Policy      
Payments Account and deposited in the Distribution Account and applied by the   
Indenture Trustee, together with the other funds to be withdrawn from the       
Distribution Account pursuant to Section 8.3(b) or Article X, as applicable,    
directly to the payment in full of the Scheduled Payment due on the applicable  
Class of Class A Notes. Funds received by the Indenture Trustee as a result of  
any claim under the Policy shall be deposited by the Indenture Trustee in the   
Policy Payments Account and used solely for payment to the Holders of the       
applicable Class of Class A Notes and may not be applied to satisfy any costs,  
expenses or liabilities of the Servicer, the Indenture Trustee or the Issuer.   
Any funds remaining                                                             

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in the Policy Payments Account on the first Business Day following a Payment    
Date shall be remitted to the Insurer, pursuant to the instructions of the      
Insurer, by the end of such Business Day.                                       

                (c) The Indenture Trustee shall keep a complete and accurate
record of the amount of interest and principal paid in respect of any Class A   
Note from moneys received under the Policy. The Insurer shall have the right to 
inspect such records at reasonable times during normal business hours upon one  
Business Day's prior notice to the Indenture Trustee.                           

      SECTION 11.5. Notices to the Insurer. All notices,
statements, reports, certificates or opinions required by this Indenture to be  
sent to any other party hereto or to any of the Noteholders shall also be sent  
to the Insurer.                                                                 

                 SECTION 11.6. Third-Party Beneficiary. The Insurer shall be a
third-party beneficiary of this Agreement, entitled to enforce the provisions   
hereof as if a party hereto.                                                    

           SECTION 11.7. Indenture Trustee to Hold the Policy. The
Indenture Trustee will hold the Policy in trust as agent for the Holders of the 
Class A Notes for the purpose of making claims thereon and distributing the     
proceeds thereof. The Policy, prior to any distributions thereon deposited into 
the Policy Payments Account, will not constitute part of the Trust Property.    
Each Holder of Class A Notes, by accepting its Class A Notes, appoints the      
Indenture Trustee as attorney-in-fact for the purpose of making claims on the   
Policy.                                                                         

ARTICLE XII 

 Miscellaneous

                 SECTION 12.1. Compliance Certificates and Opinions, etc. Upon
any application or request by the Issuer to the Indenture Trustee to take any   
action under any provision of this Indenture, the Issuer shall furnish to the   
Indenture Trustee and to the Insurer (i) an Officer's Certificate stating that  
all conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with, (ii) an Opinion of Counsel stating that
in the opinion of such counsel all such conditions precedent, if any, have been 
complied with and (iii) (if required by the TIA) an Independent Certificate from
a firm of certified public accountants meeting the applicable requirements of   
this Section, except that, in the case of any such application or request as to 
which the furnishing of such documents is specifically required by any provision
of this Indenture, no additional certificate or opinion need be furnished.      

                  Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:             

              (i) a statement that each signatory of such certificate or
      opinion has read or has caused to be read such covenant or condition
and the definitions herein relating thereto;                  

            (ii) a brief statement as to the nature and scope of the
    examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;           

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                  (iii) a statement that, in the opinion of each such signatory,
 such signatory has made such examination or investigation as is
         necessary to enable such signatory to express an informed opinion as to
       whether or not such covenant or condition has been complied with; and

               (iv) a statement as to whether, in the opinion of each such
signatory such condition or covenant has been complied with.  

          SECTION 12.2. Form of Documents Delivered to Indenture
Trustee. In any case where several matters are required to be certified by, or  
covered by an opinion of, any specified Person, it is not necessary that all    
such matters be certified by, or covered by the opinion of, only one such       
Person, or that they be so certified or covered by only one document, but one   
such Person may certify or give an opinion with respect to some matters and one 
or more other such Persons as to other matters, and any such Person may certify 
or give an opinion as to such matters in one or several documents.              

              Any certificate or opinion of an Authorized Officer of the
Issuer may be based, insofar as it relates to legal matters, upon a certificate 
or opinion of, or representations by, counsel, unless such officer knows, or in 
the exercise of reasonable care should know, that the certificate or opinion or 
representations with respect to the matters upon which his or her certificate or
opinion is based are erroneous. Any such certificate of an Authorized Officer or
Opinion of Counsel may be based, insofar as it relates to factual matters, upon 
a certificate or opinion of, or representations by, an officer or officers of   
the Servicer, the Unaffiliated Seller or the Issuer, stating that the           
information with respect to such factual matters is in the possession of the    
Servicer, the Unaffiliated Seller or the Issuer, unless such counsel knows, or  
in the exercise of reasonable care should know, that the certificate or opinion 
or representations with respect to such matters are erroneous.                  

                Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or    
other instruments under this Indenture, they may, but need not, be consolidated 
and form one instrument.                                                        

                  Whenever in this Indenture, in connection with any application
or certificate or report to the Indenture Trustee, it is provided that the      
Issuer shall deliver any document as a condition of the granting of such        
application, or as evidence of the Issuer's compliance with any term hereof, it 
is intended that the truth and accuracy, at the time of the granting of such    
application or at the effective date of such certificate or report (as the case 
may be), of the facts and opinions stated in such document shall in such case be
conditions precedent to the right of the Issuer to have such application granted
or to the sufficiency of such certificate or report. The foregoing shall not,   
however, be construed to affect the Indenture Trustee's right to conclusively   
rely upon the truth and accuracy of any statement or opinion contained in any   
such document as provided in Article VI.                                        

             SECTION 12.3. Acts of Noteholders. (a) Subject to Section
11.1, Any request, demand, authorization, direction, notice, consent, waiver or 
other action provided by this Indenture to be given or taken by Noteholders may 
be embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Noteholders in person or by                                

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agents duly appointed in writing; and except as herein otherwise expressly      
provided such action shall become effective when such instrument or instruments 
are delivered to the Indenture Trustee, and, where it is hereby expressly       
required, to the Issuer. Such instrument or instruments (and the action embodied
therein and evidenced thereby) are herein sometimes referred to as the "Act" of 
the Noteholders signing such instrument or instruments. Proof of execution of   
any such instrument or of a writing appointing any such agent shall be          
sufficient for any purpose of this Indenture and (subject to Section 6.1)       
conclusive in favor of the Indenture Trustee and the Issuer, if made in the     
manner provided in this Section.                                                

               (b) The fact and date of the execution by any person of any
such instrument or writing may be proved in any customary manner of the         
Indenture Trustee.                                                              

          (c) The ownership of Notes shall be proved by the Note
Register.                                                                       

              (d) Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Holder of any Notes shall bind the Holder
of every Note issued upon the registration thereof or in exchange therefor or in
lieu thereof, in respect of anything done, omitted or suffered to be done by the
Indenture Trustee or the Issuer in reliance thereon, whether or not notation of 
such action is made upon such Note.                                             

             SECTION 12.4. Notices, etc. to Indenture Trustee, Issuer,
Insurer and Rating Agencies. Any request, demand, authorization, direction,     
notice, consent, waiver or Act of Noteholders or other documents provided or    
permitted by this Indenture to be made upon, given or furnished to or filed     
with:                                                                           

                (a) The Indenture Trustee by any Noteholder or by the Issuer
shall be sufficient for every purpose hereunder if personally delivered,        
delivered by overnight courier or mailed first-class and shall be deemed to have
been duly given upon receipt to the Indenture Trustee at its Corporate Trust    
Office and any notice delivered by facsimile shall be addressed to the Corporate
Trust Office, telecopy number (704) 383-7316, or                                

                (b) The Issuer by the Indenture Trustee or by any Noteholder
shall be sufficient for every purpose hereunder if personally delivered,        
delivered by facsimile or overnight courier or mailed first class, and shall    
deemed to have been duly given upon receipt to the Issuer addressed to: HomeGold
Home Equity Loan Trust 1999-1, in care of Wilmington Trust Company, Rodney      
Square North, 1100 North Market Street, Wilmington, DE 19890-0001 Attention:    
Corporate Trust Administration, or at any other address previously furnished in 
writing to the Indenture Trustee by Issuer. The Issuer shall promptly transmit  
any notice received by it from the Noteholders to the Indenture Trustee.        

                (c) The Insurer by the Issuer or the Indenture Trustee shall
be sufficient for any purpose hereunder if in writing and mailed by first-class 
mail personally delivered or telecopied to the recipient as follows:            

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       To the Insurer:   Financial Security Assurance Inc.
       350 Park Avenue
                New York, New York 10022
                           Attention:  Surveillance Department
                                   Re:  HomeGold Home Equity Loan Trust 1999-1
                 Telecopy:  (212) 888-5278

              Notices required to be given to the Rating Agencies by the
Issuer, the Indenture Trustee or the Owner Trustee shall be in writing,         
personally delivered, delivered by overnight courier or first class or via      
facsimile to (i) in the case of Moody's, at the following address: Moody's      
Investors Service, Inc., 99 Church Street, New York, New York 10004, Fax No.:   
(212) 533-0355 and (ii) in the case of S&P, at the following address: Standard &
Poor's Ratings Group, 26 Broadway (15th Floor), New York, New York 10004,       
Attention: Asset Backed Surveillance Department, Fax No.: (212) 412-0224; or as 
to each of the foregoing, at such other address as shall be designated by       
written notice to the other parties.                                            

            SECTION 12.5. Notices to Noteholders; Waiver. Where this
Indenture provides for notice to Noteholders of any event, such notice shall be 
sufficiently given (unless otherwise herein expressly provided) if in writing   
and mailed, first-class, postage prepaid to each Noteholder affected by such    
event, at his address as it appears on the Note Register, not later than the    
latest date, and not earlier than the earliest date, prescribed for the giving  
of such notice. In any case where notice to Noteholders is given by mail,       
neither the failure to mail such notice nor any defect in any notice so mailed  
to any particular Noteholder shall affect the sufficiency of such notice with   
respect to other Noteholders, and any notice that is mailed in the manner herein
provided shall conclusively be presumed to have been duly given.                

                Where this Indenture provides for notice in any manner, such
notice may be waived in writing by any Person entitled to receive such notice,  
either before or after the event, and such waiver shall be the equivalent of    
such notice. Waivers of notice by Noteholders shall be filed with the Indenture 
Trustee but such filing shall not be a condition precedent to the validity of   
any action taken in reliance upon such a waiver.                                

                In case, by reason of the suspension of regular mail service
as a result of a strike, work stoppage or similar activity, it shall be         
impractical to mail notice of any event to Noteholders when such notice is      
required to be given pursuant to any provision of this Indenture, then any      
manner of giving such notice as shall be satisfactory to the Indenture Trustee  
shall be deemed to be a sufficient giving of such notice.                       

          Where this Indenture provides for notice to the Rating
Agencies, failure to give such notice shall not affect any other rights or      
obligations created hereunder.                                                  

           SECTION 12.6. Alternate Payment and Notice Provisions .
Notwithstanding any provision of this Indenture or any of the Notes to the      
contrary, the Issuer may enter into any agreement with any Holder of a Note     
providing for a method of payment, or notice by the Indenture Trustee or any    
Note Paying Agent to such Holder, that is different from the methods provided   
for in this Indenture for such payments or notices, provided that such methods  
are reasonable and consented to by the Indenture Trustee (which consent shall   
not be unreasonably                                                             

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withheld). The Issuer will furnish to the Indenture Trustee a copy of each such 
agreement and the Indenture Trustee will cause payments to be made and notices  
to be given in accordance with such agreements.                                 

           SECTION 12.7. Conflict with Trust Indenture Act. If any
provision hereof limits, qualifies or conflicts with another provision hereof   
that is required to be included in this indenture by any of the provisions of   
the Trust Indenture Act, such required provision shall control.                 

            The provisions of TIA ss.ss. 310 through 317 that impose
duties on any person (including the provisions automatically deemed included    
herein unless expressly excluded by this Indenture) are a part of and govern    
this Indenture, whether or not physically contained herein.                     

               SECTION 12.8. Effect of Headings and Table of Contents. The
Article and Section headings herein and the Table of Contents are for           
convenience only and shall not affect the construction hereof.                  

           SECTION 12.9. Successors and Assigns. All covenants and
agreements in this Indenture and the Notes by the Issuer shall bind its         
successors and assigns, whether so expressed or not. All agreements of the      
Indenture Trustee in this Indenture shall bind its successors.                  

              SECTION 12.10. Separability. In case any provision in this
Indenture or in the Notes shall be invalid, illegal or unenforceable, the       
validity, legality, and enforceability of the remaining provisions shall not in 
any way be affected or impaired thereby.                                        

             SECTION 12.11. Benefits of Indenture. The Insurer and its
successors and assigns shall be a third-party beneficiary to the provisions of  
this Indenture, and shall be entitled to rely upon and directly to enforce such 
provisions of this Indenture. Nothing in this Indenture or in the Notes, express
or implied, shall give to any Person, other than the parties hereto and their   
successors hereunder, the Insurer and the Noteholders, and any other party      
secured hereunder, and any other person with an ownership interest in any part  
of the Trust Property, any benefit or any legal or equitable right, remedy or   
claim under this Indenture. The Insurer may disclaim any of its rights and      
powers under this Indenture (in which case the Indenture Trustee may exercise   
such right or power hereunder), but not its duties and obligations under the    
Policy, upon delivery of a written notice to the Indenture Trustee.             

                SECTION 12.12. Legal Holidays. In any case where the date on
which any payment is due shall not be a Business Day, then (notwithstanding any 
other provision of the Notes or this Indenture) payment need not be made on such
date, but may be made on the next succeeding Business Day with the same force   
and effect as if made on the date on which nominally due, and no interest shall 
accrue for the period from and after any such nominal date.                     

         SECTION 12.13. GOVERNING LAW. THIS INDENTURE SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT         
REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND    
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH   
LAWS.                                                                           

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               SECTION 12.14. Counterparts. This Indenture may be executed
in any number of counterparts, each of which so executed shall be deemed to be  
an original, but all such counterparts shall together constitute but one and the
same instrument.                                                                

               SECTION 12.15. Recording of Indenture. If this Indenture is
subject to recording in any appropriate public recording offices, such recording
is to be effected by the Issuer and at its expense accompanied by an Opinion of 
Counsel (which may be counsel to the Trust or any other counsel reasonably      
acceptable to the Indenture Trustee and the Insurer) to the effect that such    
recording is necessary either for the protection of the Noteholders or any other
person secured hereunder or for the enforcement of any right or remedy granted  
to the Indenture Trustee under this Indenture.                                  

              SECTION 12.16. Trust Obligation. No recourse may be taken,
directly or indirectly, with respect to the obligations of the Issuer, the      
Unaffiliated Seller, the Depositor, the Servicer, the Owner Trustee or the      
Indenture Trustee on the Notes or under this Indenture or any certificate or    
other writing delivered in connection herewith or therewith, against (i) the    
Unaffiliated Seller, the Depositor, the Servicer, the Indenture Trustee or the  
Owner Trustee in its individual capacity, (ii) any owner of a beneficial        
interest in the Issuer or (iii) any partner, owner, beneficiary, agent, officer,
director, employee or agent of the Unaffiliated Seller, the Depositor, the      
Servicer, the Indenture Trustee or the Owner Trustee in its individual capacity,
any holder of a beneficial interest in the Issuer, the Unaffiliated Seller, the 
Depositor, the Servicer, the Owner Trustee or the Indenture Trustee or of any   
successor or assign of the Unaffiliated Seller, the Depositor, the Servicer, the
Indenture Trustee or the Owner Trustee in its individual capacity, except as any
such Person may have expressly agreed (it being understood that the Indenture   
Trustee and the Owner Trustee have no such obligations in their individual      
capacity) and except that any such owner or beneficiary shall be fully liable,  
to the extent provided by applicable law, for any unpaid consideration for      
stock, unpaid capital contribution or failure to pay any installment or call    
owing to such entity. For all purposes of this Indenture, in the performance of 
any duties or obligations of the Issuer hereunder, the Owner Trustee shall be   
subject to, and entitled to the benefits of, the terms and provisions of        
Articles VII and VIII of the Trust Agreement.                                   

         SECTION 12.17. No Petition. The Indenture Trustee, by
entering into this Indenture, and each Noteholder, by accepting a Note, hereby  
covenant and agree that they will not at any time institute against the         
Unaffiliated Seller, the Depositor, or the Issuer, or join in any institution   
against the Unaffiliated Seller, the Depositor, or the Issuer of, any           
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, 
or other proceedings under any United States Federal or state bankruptcy or     
similar law in connection with any obligations relating to the Notes, this      
Indenture or any of the Basic Documents.                                        

         SECTION 12.18. Inspection. The Issuer agrees that, on
reasonable prior notice, it will permit any representative of the Indenture     
Trustee or of the Insurer, during the Issuer's normal business hours, to examine
all the books of account, records, reports, and other papers of the Issuer, to  
make copies and extracts therefrom, to cause such books to be audited by        
independent certified public accountants, and to discuss the Issuer's affairs,  
finances and accounts with the Issuer's officers, employees, and independent    
certified public accountants, all at such reasonable times and as often as may  
be reasonably requested. The Indenture Trustee                                  

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shall and shall cause its representatives to hold in confidence all such        
information except to the extent disclosure may be required by law (and all     
reasonable applications for confidential treatment are unavailing) and except to
the extent that the Indenture Trustee may reasonably determine that such        
disclosure is consistent with its Obligations hereunder.                        

           SECTION 12.19. Limitation of Liability. It is expressly
understood and agreed by the parties hereto that (a) this Agreement is executed 
and delivered by Wilmington Trust Company, not individually or personally but   
solely as Owner Trustee of the Issuer under the Trust Agreement, in the exercise
of the powers and authority conferred and vested in it, (b) each of the         
representations, undertakings and agreements herein made on the part of the     
Issuer is made and intended not as personal representations, undertakings and   
agreements by Wilmington Trust Company but is made and intended for the purpose 
for binding only the Issuer, (c) nothing herein contained shall be construed as 
creating any liability on Wilmington Trust Company individually or personally,  
to perform any covenant either expressed or implied contained herein, all such  
liability, if any, being expressly waived by the parties to this Agreement and  
by any person claiming by, through or under them and (d) under no circumstances 
shall Wilmington Trust Company be personally liable for the payment of any      
indebtedness or expenses of the Issuer or be liable for the breach or failure of
any obligation, representation, warranty or covenant made or undertaking by the 
Issuer under this Agreement or any related documents.                           

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                 IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have
caused this Indenture to be duly executed by their respective officers, hereunto
duly authorized, all as of the day and year first above written.                

       HOMEGOLD HOME EQUITY LOAN TRUST
1999-1,         

            By: WILMINGTON TRUST COMPANY, not in
                           its individual capacity but solely as Owner
Trustee,        

   By: /s/ Virginia Karablacas
                          --------------------------------------------
Name:           
Title:          

             FIRST UNION NATIONAL BANK, not in its
                   individual capacity but solely as Indenture
Trustee,                

 By: /s/ Pablo de La Canal
                            --------------------------------------------
Name:           
Title:          

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                                                                       EXHIBIT A

 GLOSSARY OF DEFINED TERMS

 [See Separate Document]

 A-1

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                                                                     EXHIBIT B-1

[Form of Class A-1 Note]

REGISTERED                                                           $18,418,000

No. A-1                                                                         

                                                           CUSIP NO. 43740C AA 6

                 Unless this Note is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to the Issuer  
or its agent for registration of transfer, exchange or payment, and any Note    
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.                                     

                                                        [Enlarge/Download Table]

===========================================================================================================
                                                                                                           
Series 1999-1, Class A-1                                    Class A-1 Note Principal Balance as of the     
                                                            Issue Date: $18,418,000                        
-----------------------------------------------------------------------------------------------------------
Initial Interest Rate: 6.87%                                                                               
-----------------------------------------------------------------------------------------------------------
Date of Sale and Servicing Agreement:                       Denomination: $18,418,000                      

May 1, 1999                                                                                                
-----------------------------------------------------------------------------------------------------------
First Payment Date:                                         Servicer:                                      

June 15, 1999                                               HomeGold, Inc.                                 
-----------------------------------------------------------------------------------------------------------
Final  Maturity  Date: July 15, 2029 or, if                Indenture Trustee:                              
earlier, the Redemption Date (as defined)                                                                  
                                                            First Union National Bank                      
-----------------------------------------------------------------------------------------------------------
                                                            Issue Date: May 27, 1999                       
-----------------------------------------------------------------------------------------------------------
                                                            CUSIP: 43740C AA 6                             
===========================================================================================================

         PAYMENTS IN REDUCTION OF THE NOTE PRINCIPAL BALANCE OF THIS NOTE MAY BE
     MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING NOTE
        PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.                                                        

  THIS NOTE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN THE
      SERVICER, THE INDENTURE TRUSTEE, THE OWNER TRUSTEE, THE UNAFFILIATED
    SELLER, THE CONTRIBUTOR, THE DEPOSITOR OR ANY OF THEIR AFFILIATES.
NEITHER THIS NOTE NOR THE UNDERLYING                          

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       MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.                                                

HOMEGOLD HOME EQUITY LOAN TRUST 1999-1

CLASS A-1 ASSET BACKED NOTES

            HomeGold Home Equity Loan Trust 1999-1, a business trust
organized and existing under the laws of the State of Delaware (herein referred 
to as the "Issuer"), for value received, hereby promises to pay to CEDE & CO.,  
or registered assigns, the principal sum of ($18,418,000), such amount payable  
on each Payment Date in an amount equal to the result obtained by multiplying   
(i) a fraction the numerator of which is the initial Note Principal Balance     
hereof and the denominator of which is the initial aggregate Note Principal     
Balance of the Class A-1 Notes by (ii) the aggregate amount, if any, payable on 
such Payment Date in respect of principal on the Class A-1 Notes pursuant to    
Section 8.3 of the Indenture; provided, however, that the entire unpaid         
principal amount of this Note shall be due and payable on the Final Maturity    
Date. The unpaid principal of this Note shall accrue interest at the initial    
rate of 6.87% per annum (for each Interest Accrual Period on or prior to the    
date on which the Servicer could exercise its option to redeem the Notes as     
provided in Article X of the Indenture) or 7.37% (for each Interest Accrual     
Period after such date), which (except for Shortfall Interest Deferred Amounts  
and Accrued Shortfall Interest Carry Forward Amounts (as defined in the         
Indenture), which shall be due and payable only to the extent funds are         
available therefor as provided in the Indenture) shall be due and payable on    
each Payment Date prior to the Final Payment Date and (without regard to the    
availability of funds for the payment of Shortfall Interest Deferred Amounts and
Accrued Shortfall Interest Carry Forward Amounts) on the Final Payment Date. The
Interest Accrual Period for any Payment Date is the calendar month immediately  
preceding the month in which such Payment Date occurs. All calculations of      
interest on the Class A-1 Notes will be based on a 360-day year consisting of   
twelve 30-day months. Payments in respect of principal and interest will be made
on each Payment Date to the Person in whose name this Note is registered on the 
last Business Day of the month immediately preceding the month of such payment  
as provided in the Indenture.                                                   

                  The principal of and interest on this Note are payable in such
coin or currency of the United States of America as at the time of payment is   
legal tender for payment of public and private debts.                           

                  The Notes are entitled to the benefits of a financial guaranty
insurance policy (the "Policy") issued by Financial Security Assurance Inc. (the
"Insurer"), pursuant to which the Insurer has unconditionally guaranteed        
payments of principal and interest (excluding Shortfall Interest Deferred       
Amounts and Accrued Shortfall Interest Carry Forward Amounts), all as more fully
set forth in the Indenture and the Policy.                                      

              For purposes of federal income, state and local income and
franchise and any other income taxes, the Issuer will treat the Notes as        
indebtedness and has instructed the Indenture Trustee to treat the Notes as     
indebtedness for federal and state tax reporting purposes.                      

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            Reference is made to the further provisions of this Note
following the Indenture Trustee's Certificate of Authentication, which shall    
have the same effect as though fully set forth herein.                          

            Unless the Certificate of Authentication hereon has been
executed by the Indenture Trustee whose name appears below by manual signature, 
this Note shall not be entitled to any benefit under the Indenture referred to  
on the reverse hereof, or be valid or obligatory for any purpose.               

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                IN WITNESS WHEREOF, the Issuer has caused this instrument to
be signed, manually or in facsimile, by its Authorized Officer.                 

Date:  May 27, 1999                                                             

          HOMEGOLD HOME EQUITY LOAN TRUST 1999-1

              By:   WILMINGTON TRUST COMPANY, not in its
                               individual capacity but solely as Owner Trustee
         under the Trust Agreement

By:                         
                             -------------------------------------------------
Name:               
Title:              

 INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION

                This is one of the Notes designated above and referred to in
the within-mentioned Indenture.                                                 

Date:  May 27, 1999                                                             

                 FIRST UNION NATIONAL BANK, not in its individual capacity but
solely as Indenture Trustee,  

By:                                   
                 -------------------------------------------------
Authorized Signatory          

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FURTHER PROVISIONS

                  This Class A-1 Note is one of a duly authorized issue of Notes
of the Issuer, designated as its Class A Asset Backed Notes (herein called the  
"Class A Notes"), all issued under an Indenture dated as of May 1, 1999 (such   
Indenture, as supplemented or amended, is herein called the "Indenture"),       
between the Issuer and First Union National Bank, as trustee (the "Indenture    
Trustee," which term includes any successor Indenture Trustee under the         
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights and obligations         
thereunder of the Issuer, the Indenture Trustee and the Holders of the Notes.   
The Notes are subject to all terms of the Indenture. All terms used in this Note
that are defined in the Indenture, as supplemented or amended, shall have the   
meanings assigned to them in or pursuant to the Indenture, as so supplemented or
amended.                                                                        

                 The Class A Notes are and will be equally and ratably secured
by the collateral pledged as security therefor as provided in the Indenture.    

                  Principal of the Class A Notes will be payable on each Payment
Date in an amount described above. "Payment Date" means the fifteenth day of    
each month, or, if any such date is not a Business Day, the next succeeding     
Business Day, commencing June 15, 1999. The term "Payment Date" shall be deemed 
to include the Final Payment Date and, unless the context otherwise requires,   
the Final Maturity Date. The Final Maturity Date of the Class A-1 Notes is July 
15, 2029 or, if earlier, the Redemption Date (as defined below).                

                  As described above, the entire unpaid principal amount of this
Note shall be due and payable on the earlier of the Final Payment Date and the  
Redemption Date, if any. Notwithstanding the foregoing, the entire unpaid       
principal amount of the Notes may be accelerated, and upon such acceleration    
shall become, due and payable if an Event of Default shall have occurred and be 
continuing, in the manner, with the effect and subject to the conditions        
provided in the Indenture.                                                      

             As provided in the Indenture, the Servicer shall have the
option to cause the Notes to be redeemed, in whole but not in part, on any      
Payment Date after which the aggregate Class A-1 Note Principal Balance is      
$1,841,800 or less.                                                             

                  So long as this Note is registered in the name of a Depository
or its nominee, the Trustee will make payments of principal and interest on this
Note by wire transfers of immediately available funds to the Depository or its  
nominee. Otherwise all payments to the Holder of this Note under the Indenture  
will be made or caused to be made by or on behalf of the Indenture Trustee by   
wire transfer in immediately available funds to the account of the Person       
entitled thereto if such Person shall have so notified the Indenture Trustee in 
writing at least five Business Days prior to the Record Date immediately prior  
to such Payment Date and is the registered owner of Class A-1 Notes the         
aggregate initial Note Principal Balance of which is in excess of $5,000,000, or
by check mailed by first class mail to the address of the Person entitled       
thereto, as such name and address shall appear on the Note Register, provided   
that the Indenture Trustee may deduct a reasonable wire transfer fee from any   
payment made by wire transfer. Notwithstanding the above, the final payment on  
this Note will be made after due notice by the Indenture Trustee of the pendency
of such payment and only upon presentation and surrender of                     

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this Note at the office or agency appointed by the Indenture Trustee for that   
purpose as provided in the Agreement.                                           

          Payments in respect of the Class A-1 Notes are limited
recourse obligations of the Issuer payable solely from certain collections and  
recoveries respecting the Mortgage Loans and payments under the Policy, all as  
more specifically set forth herein, in the Indenture and the Policy. As provided
in the Sale and Servicing Agreement and the Indenture, withdrawals from the     
Collection Account and the Distribution Account may be made from time to time   
for purposes other than payments to Noteholders, such purposes including        
reimbursement of advances made, or certain expenses incurred, with respect to   
the Mortgage Loans.                                                             

                  The Indenture and the Sale and Serving Agreement each permits,
with certain exceptions therein provided, the amendment thereof and the         
modification of the rights and obligations of the Depositor, the Servicer, the  
Indenture Trustee and the rights of the Noteholders under the Indenture and the 
Sale and Servicing Agreement, as the case may be, at any time by the parties    
thereto with the consent of the Holders of Notes and the Insurer. Any such      
consent by the Holder of this Note shall be conclusive and binding on such      
Holder and upon all future Holders of this Note and of any Note issued upon the 
transfer hereof or in exchange hereof or in lieu hereof whether or not notation 
of such consent is made upon this Note. The Indenture and the Sale and Servicing
Agreement each also permit the amendment thereof, in certain limited            
circumstances, without the consent of the Holders of any of the Notes. In       
addition, pursuant to Section 11.1 of the Indenture, the Insurer, so long as no 
Insurer Default shall have occurred and be continuing, shall, except in certain 
limited circumstances, be entitled to exercise all rights of the Noteholders    
(including voting rights) under the Indenture without any further consent of the
Noteholders and, so long as no Insurer Default shall have occurred and be       
continuing, the consent to any action or other matter of the Insurer shall be   
deemed to also constitute the consent thereto of the requisite percentage of    
Noteholders required by the Indenture in respect of such action or matter.      

       As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Note is registrable in the  
Note Register upon surrender of this Note for registration of transfer at the   
offices or agencies appointed by the Indenture Trustee as provided in the       
Indenture, (i) duly endorsed by, or accompanied by an assignment in the form    
below or other written instrument of transfer in form satisfactory to the       
Indenture Trustee and the Note Registrar duly executed by, the Holder hereof or 
such Holder's attorney duly authorized in writing, with such signature          
guaranteed by an "eligible guarantor institution" meeting the requirements of   
the Note Registrar which requirements include membership or participation in    
Securities Transfer Agents Medallion Program ("Stamp") or such other "signature 
guarantee program" as may be determined by the Note Registrar in addition to, or
in substitution for, Stamp, all in accordance with the Exchange Act, and (ii)   
accompanied by such other documents as the Indenture Trustee may require, and   
thereupon one or more new Notes of the same Class in authorized denominations   
evidencing the same aggregate principal amount will be issued to the designated 
transferee or transferees.                                                      

                The Notes are issuable in fully registered form only without
coupons in Classes and denominations and in the original principal amounts      
specified in the Indenture. As provided in the Indenture and subject to certain 
limitations therein set forth, Notes are exchangeable for                       

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new Notes of the same Class in authorized denominations in the same aggregate   
principal amount, as requested by the Holder surrendering the same.             

               No service charge will be made for any such registration of
transfer or exchange of Notes, but the Indenture Trustee may require payment of 
a sum sufficient to cover any tax or other governmental charge that may be      
imposed in connection with any transfer or exchange of Notes.                   

              Any Noteholder using the assets of (i) an employee benefit
plan (as defined in Section 3(3) of the Employee Retirement Income Security Act 
of 1974, as amended ("ERISA"), that is subject to the provisions of Title I of  
ERISA, (ii) a plan described in Section 4975(e)(1) of the Internal Revenue Code 
of 1986, as amended, or (iii) any entity whose underlying assets include plan   
assets by reason of a plan's investment in the entity to purchase the Notes, or 
to whom the Notes are transferred, will be deemed to have represented that the  
acquisition and continued holding of the Notes will be covered by a U.S.        
Department of Labor Class Exemption.                                            

                 The Depositor, the Servicer, the Indenture Trustee, the Owner
Trustee, the Insurer and the Note Registrar and any agent of the Depositor, the 
Servicer, the Indenture Trustee, the Owner Trustee, the Insurer or the Note     
Registrar may treat the Person in whose name this Note is registered as the     
owner hereof for all purposes, and none of the Depositor, the Servicer, the     
Indenture Trustee, the Owner Trustee, the Insurer, the Note Registrar nor any   
such agent shall be affected by notice to the contrary.                         

                 The recitals contained herein shall be taken as statements of
the Issuer and the Indenture Trustee assumes no responsibility for their        
correctness.                                                                    

                 Each Noteholder or Note Owner, by acceptance of a Note or, in
the case of a Note Owner, a beneficial interest in a Note covenants and agrees  
that no recourse may be taken, directly or indirectly, with respect to the      
obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the    
Notes or under the Indenture or any certificate or other writing delivered in   
connection therewith, against (i) the Unaffiliated Seller, the Depositor, the   
Servicer, the Indenture Trustee or the Owner Trustee in its individual capacity,
(ii) any owner of a beneficial interest in the Issuer or (iii) any owner,       
beneficiary, agent, officer, director or employee of the Unaffiliated Seller,   
the Depositor, the Servicer, the Indenture Trustee or the Owner Trustee in its  
individual capacity, any holder of a beneficial interest in the Issuer, the     
Unaffiliated Seller, the Depositor, the Servicer, the Owner Trustee or the      
Indenture Trustee or of any successor or assign of the Unaffiliated Seller, the 
Depositor, the Servicer, the Indenture Trustee or the Owner Trustee in its      
individual capacity, except as any such Person may have expressly agreed (it    
being understood that the Indenture Trustee and the Owner Trustee have no such  
obligations in their individual capacity) and except that any such owner or     
beneficiary shall be fully liable, to the extent provided by applicable law, for
any unpaid consideration for stock, unpaid capital contribution or failure to   
pay any installment or call owing to such entity.                               

                 Each Noteholder or Note Owner, by acceptance of a Note or, in
the case of a Note Owner, a beneficial interest in a Note covenants and agrees  
that by accepting the benefits of the Indenture that such Noteholder will not at
any time institute against the Unaffiliated Seller, the Depositor,              

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or the Issuer or join in any institution against the Unaffiliated Seller, the   
Depositor, or the Issuer of, any bankruptcy, reorganization, arrangement,       
insolvency or liquidation proceedings, or other proceedings, under any United   
States Federal or state bankruptcy or similar law in connection with any        
obligations relating to the Notes, the Indenture or the Basic Documents.        

                Prior to the due presentment for registration of transfer of
this Note, the Issuer, the Indenture Trustee and the Insurer and any agent of   
the Issuer, the Indenture Trustee or the Insurer may treat the Person in whose  
name this Note (as of the day of determination or as of such other date as may  
be specified in the Indenture) is registered as the owner hereof for all        
purposes, whether or not this Note be overdue, and neither the Issuer, the      
Indenture Trustee nor any such agent shall be affected by notice to the         
contrary.                                                                       

                 The term "Issuer" as used in this Note includes any successor
to the Issuer under the Indenture.                                              

                This Note and the Indenture shall be construed in accordance
with the laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder   
and thereunder shall be determined in accordance with such laws.                

                 No reference herein to the Indenture and no provision of this
Note or of the Indenture shall alter or impair the obligation of the Issuer,    
which is absolute and unconditional, to pay the principal of and interest on    
this Note at the times, place, and rate, and in the coin or currency herein     
prescribed.                                                                     

              Anything herein to the contrary notwithstanding, except as
expressly provided in the Indenture or the Basic Documents, none of Wilmington  
Trust Company in its individual capacity, any owner of a beneficial interest in 
the Issuer, or any of their respective beneficiaries, agents, officers,         
directors, employees or successors or assigns shall be personally liable for,   
nor shall recourse be had to any of them for, the payment of principal of or    
interest on, or performance of, or omission to perform, any of the covenants,   
obligations or indemnifications contained in this Note or the Indenture, it     
being expressly understood that said covenants, obligations and indemnifications
have been made by the Issuer for the sole purposes of binding the interests of  
the Issuer in the assets of the Issuer. The Holder of this Note by the          
acceptance hereof agrees that except as expressly provided in the Indenture or  
the Basic Documents, in the case of a Default or an Event of Default under the  
Indenture, the Holder shall have no claim against any of the foregoing for any  
deficiency, loss or claim therefrom; provided, however, that nothing contained  
herein shall be taken to prevent recourse to, and enforcement against, the      
assets of the Issuer for any and all liabilities, obligations and undertakings  
contained in the Indenture or in this Note.                                     

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ASSIGNMENT

   FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto                                                                
                 ---------------------------------------------------------------

-----------------------------(Please print or typewrite name, address including 
postal zip code, and Taxpayer Identification Number of assignee)                
                                                                ----------------
--------------------------------------------------------------------------------
the  within Note on the books kept for registration thereof, with full power of 
substitution in the premises.                                                   

      I (we) further direct the Note Registrar to issue a new Note of like
tenor to the above named assignee and deliver such Note to the following        
address:                                                                        
        ------------------------------------------------------------------------

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

Dated:                                                                          

                              --------------------------------------------------
                 Signature by or on behalf of assignor

                              --------------------------------------------------
Signature Guaranteed

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PAYMENT INSTRUCTIONS

The assignee should include the following for purposes of     
distribution:                                                                   

       Payments 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     , as its agent.           

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                                                                   EXHIBIT B-2

[Form of Class A-2 Note]

REGISTERED                                                           $35,546,000

No. A-2                                                                         

                                                           CUSIP NO. 43740C AB 4

                 Unless this Note is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to the Issuer  
or its agent for registration of transfer, exchange or payment, and any Note    
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.                                     

                                                        [Enlarge/Download Table]

============================================================================================
                                                                                            
Series 1999-1, Class A-2                       Class A-2 Note Principal Balance as of the   
                                               Issue Date: $35,546,000                      
--------------------------------------------------------------------------------------------
Initial Interest Rate: 6.82%                                                                
--------------------------------------------------------------------------------------------
Date of Sale and Servicing Agreement:          Denomination:  $35,546,000                   

May 1, 1999                                                                                 
--------------------------------------------------------------------------------------------
First Payment Date:                            Servicer:                                    

June 15, 1999                                  HomeGold, Inc.                               
--------------------------------------------------------------------------------------------
Final Maturity Date: August 15, 2029 or, if   Indenture Trustee:                            
earlier, the Redemption Date (as defined)                                                   

                                               First Union National Bank                    
--------------------------------------------------------------------------------------------
                                               Issue Date: May 27, 1999                     
--------------------------------------------------------------------------------------------
                                               CUSIP: 43740C AB 4                           
============================================================================================

      PAYMENTS IN REDUCTION OF THE NOTE PRINCIPAL BALANCE OF THIS NOTE MAY
        BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING NOTE
        PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.                                                        

  THIS NOTE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN THE
      SERVICER, THE INDENTURE TRUSTEE, THE OWNER TRUSTEE, THE UNAFFILIATED
    SELLER, THE CONTRIBUTOR, THE DEPOSITOR OR ANY OF THEIR AFFILIATES.
NEITHER THIS NOTE NOR THE UNDERLYING                          

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       MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.                                                

HOMEGOLD HOME EQUITY LOAN TRUST 1999-1

CLASS A-2 ASSET BACKED NOTES

            HomeGold Home Equity Loan Trust 1999-1, a business trust
organized and existing under the laws of the State of Delaware (herein referred 
to as the "Issuer"), for value received, hereby promises to pay to CEDE & CO.,  
or registered assigns, the principal sum of ($53,964,000), such amount payable  
on each Payment Date in an amount equal to the result obtained by multiplying   
(i) a fraction the numerator of which is the initial Note Principal Balance     
hereof and the denominator of which is the initial aggregate Note Principal     
Balance of the Class A-2 Notes by (ii) the aggregate amount, if any, payable on 
such Payment Date in respect of principal on the Class A-2 Notes pursuant to    
Section 8.3 of the Indenture; provided, however, that the entire unpaid         
principal amount of this Note shall be due and payable on the Final Maturity    
Date. The unpaid principal of this Note shall accrue interest at the initial    
rate of 6.82% per annum for each Interest Accrual Period on or prior to the date
on which the Servicer could exercise its option to redeem the Notes as provided 
in Article X of the Indenture) or 7.32% (for each Interest Accrual Period after 
such date), which (except for Shortfall Interest Deferred Amounts and Accrued   
Shortfall Interest Carry Forward Amounts (as defined in the Indenture), which   
shall be due and payable only to the extent funds are available therefor as     
provided in the Indenture) shall be due and payable on each Payment Date prior  
to the Final Payment Date and (without regard to the availability of funds for  
the payment of Shortfall Interest Deferred Amounts and Accrued Shortfall        
Interest Carry Forward Amounts) on the Final Payment Date. The Interest Accrual 
Period for any Payment Date is the calendar month immediately preceding the     
month in which such Payment Date occurs. All calculations of interest on the    
Class A-2 Notes will be based on a 360-day year consisting of twelve 30-day     
months. Payments in respect of principal and interest will be made on each      
Payment Date to the Person in whose name this Note is registered on the last    
Business Day of the month immediately preceding the month of such payment as    
provided in the Indenture.                                                      

                  The principal of and interest on this Note are payable in such
coin or currency of the United States of America as at the time of payment is   
legal tender for payment of public and private debts.                           

                  The Notes are entitled to the benefits of a financial guaranty
insurance policy (the "Policy") issued by Financial Security Assurance Inc. (the
"Insurer"), pursuant to which the Insurer has unconditionally guaranteed        
payments of principal and interest (excluding Shortfall Interest Deferred       
Amounts and Accrued Shortfall Interest Carry Forward Amounts), all as more fully
set forth in the Indenture and the Policy.                                      

              For purposes of federal income, state and local income and
franchise and any other income taxes, the Issuer will treat the Notes as        
indebtedness and has instructed the Indenture Trustee to treat the Notes as     
indebtedness for federal and state tax reporting purposes.                      

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            Reference is made to the further provisions of this Note
following the Indenture Trustee's Certificate of Authentication, which shall    
have the same effect as though fully set forth herein.                          

            Unless the Certificate of Authentication hereon has been
executed by the Indenture Trustee whose name appears below by manual signature, 
this Note shall not be entitled to any benefit under the Indenture referred to  
on the reverse hereof, or be valid or obligatory for any purpose.               

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                IN WITNESS WHEREOF, the Issuer has caused this instrument to
be signed, manually or in facsimile, by its Authorized Officer.                 

Date:  May 27, 1999                                                             

              HOMEGOLD HOME EQUITY LOAN TRUST 1999-1

               By:WILMINGTON TRUST COMPANY, not in its
                             individual capacity but solely as Owner Trustee
       under the Trust Agreement

By:                     
                               -------------------------------------------------
Name:             
Title:            

 INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION

                This is one of the Notes designated above and referred to in
the within-mentioned Indenture.                                                 

Date:  May 27, 1999                                                             

             FIRST UNION NATIONAL BANK, not in its
     individual capacity but
          solely as Indenture Trustee,

By:                     
                               -------------------------------------------------
    Authorized Signatory

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FURTHER PROVISIONS

                  This Class A-2 Note is one of a duly authorized issue of Notes
of the Issuer, designated as its Class A Asset Backed Notes (herein called the  
"Class A Notes"), all issued under an Indenture dated as of May 1, 1999 (such   
Indenture, as supplemented or amended, is herein called the "Indenture"),       
between the Issuer and First Union National Bank, as trustee (the "Indenture    
Trustee," which term includes any successor Indenture Trustee under the         
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights and obligations         
thereunder of the Issuer, the Indenture Trustee and the Holders of the Notes.   
The Notes are subject to all terms of the Indenture. All terms used in this Note
that are defined in the Indenture, as supplemented or amended, shall have the   
meanings assigned to them in or pursuant to the Indenture, as so supplemented or
amended.                                                                        

                 The Class A Notes are and will be equally and ratably secured
by the collateral pledged as security therefor as provided in the Indenture.    

                  Principal of the Class A Notes will be payable on each Payment
Date in an amount described above. "Payment Date" means the fifteenth day of    
each month, or, if any such date is not a Business Day, the next succeeding     
Business Day, commencing June 15, 1999. The term "Payment Date" shall be deemed 
to include the Final Payment Date and, unless the context otherwise requires,   
the Final Maturity Date. The Final Maturity Date of the Class A-2 Notes is      
August 15, 2029 or, if earlier, the Redemption Date (as defined below).         

                  As described above, the entire unpaid principal amount of this
Note shall be due and payable on the earlier of the Final Payment Date and the  
Redemption Date, if any. Notwithstanding the foregoing, the entire unpaid       
principal amount of the Notes may be accelerated, and upon such acceleration    
shall become, due and payable if an Event of Default shall have occurred and be 
continuing, in the manner, with the effect and subject to the conditions        
provided in the Indenture.                                                      

             As provided in the Indenture, the Servicer shall have the
option to cause the Notes to be redeemed, in whole but not in part, on any      
Payment Date after which the aggregate Class A-2 Note Principal Balance is      
$1,841,800 or less.                                                             

                  So long as this Note is registered in the name of a Depository
or its nominee, the Trustee will make payments of principal and interest on this
Note by wire transfers of immediately available funds to the Depository or its  
nominee. Otherwise all payments to the Holder of this Note under the Indenture  
will be made or caused to be made by or on behalf of the Indenture Trustee by   
wire transfer in immediately available funds to the account of the Person       
entitled thereto if such Person shall have so notified the Indenture Trustee in 
writing at least five Business Days prior to the Record Date immediately prior  
to such Payment Date and is the registered owner of Class A-2 Notes the         
aggregate initial Note Principal Balance of which is in excess of $5,000,000, or
by check mailed by first class mail to the address of the Person entitled       
thereto, as such name and address shall appear on the Note Register, provided   
that the Indenture Trustee may deduct a reasonable wire transfer fee from any   
payment made by wire transfer. Notwithstanding the above, the final payment on  
this Note will be made after due notice by the Indenture Trustee of the pendency
of such payment and only upon presentation and surrender of                     

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this Note at the office or agency appointed by the IndentureTrustee for that    
purpose as provided in the Agreement.                                           

          Payments in respect of the Class A-2 Notes are limited
recourse obligations of the Issuer payable solely from certain collections and  
recoveries respecting the Mortgage Loans and payments under the Policy, all as  
more specifically set forth herein, in the Indenture and the Policy. As provided
in the Sale and Servicing Agreement and the Indenture, withdrawals from the     
Collection Account and the Distribution Account may be made from time to time   
for purposes other than payments to Noteholders, such purposes including        
reimbursement of advances made, or certain expenses incurred, with respect to   
the Mortgage Loans.                                                             

                  The Indenture and the Sale and Serving Agreement each permits,
with certain exceptions therein provided, the amendment thereof and the         
modification of the rights and obligations of the Depositor, the Servicer, the  
Indenture Trustee and the rights of the Noteholders under the Indenture and the 
Sale and Servicing Agreement, as the case may be, at any time by the parties    
thereto with the consent of the Holders of Notes and the Insurer. Any such      
consent by the Holder of this Note shall be conclusive and binding on such      
Holder and upon all future Holders of this Note and of any Note issued upon the 
transfer hereof or in exchange hereof or in lieu hereof whether or not notation 
of such consent is made upon this Note. The Indenture and the Sale and Servicing
Agreement each also permit the amendment thereof, in certain limited            
circumstances, without the consent of the Holders of any of the Notes. In       
addition, pursuant to Section 11.1 of the Indenture, the Insurer, so long as no 
Insurer Default shall have occurred and be continuing, shall, except in certain 
limited circumstances, be entitled to exercise all rights of the Noteholders    
(including voting rights) under the Indenture without any further consent of the
Noteholders and, so long as no Insurer Default shall have occurred and be       
continuing, the consent to any action or other matter of the Insurer shall be   
deemed to also constitute the consent thereto of the requisite percentage of    
Noteholders required by the Indenture in respect of such action or matter.      

       As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Note is registrable in the  
Note Register upon surrender of this Note for registration of transfer at the   
offices or agencies appointed by the Indenture Trustee as provided in the       
Indenture, (i) duly endorsed by, or accompanied by an assignment in the form    
below or other written instrument of transfer in form satisfactory to the       
Indenture Trustee and the Note Registrar duly executed by, the Holder hereof or 
such Holder's attorney duly authorized in writing, with such signature          
guaranteed by an "eligible guarantor institution" meeting the requirements of   
the Note Registrar which requirements include membership or participation in    
Securities Transfer Agents Medallion Program ("Stamp") or such other "signature 
guarantee program" as may be determined by the Note Registrar in addition to, or
in substitution for, Stamp, all in accordance with the Exchange Act, and (ii)   
accompanied by such other documents as the Indenture Trustee may require, and   
thereupon one or more new Notes of the same Class in authorized denominations   
evidencing the same aggregate principal amount will be issued to the designated 
transferee or transferees.                                                      

                The Notes are issuable in fully registered form only without
coupons in Classes and denominations and in the original principal amounts      
specified in the Indenture. As provided in the Indenture and subject to certain 
limitations therein set forth, Notes are exchangeable for                       

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new Notes of the same Class in authorized denominations in the same aggregate   
principal amount, as requested by the Holder surrendering the same.             

               No service charge will be made for any such registration of
transfer or exchange of Notes, but the Indenture Trustee may require payment of 
a sum sufficient to cover any tax or other governmental charge that may be      
imposed in connection with any transfer or exchange of Notes.                   

              Any Noteholder using the assets of (i) an employee benefit
plan (as defined in Section 3(3) of the Employee Retirement Income Security Act 
of 1974, as amended ("ERISA"), that is subject to the provisions of Title I of  
ERISA, (ii) a plan described in Section 4975(e)(1) of the Internal Revenue Code 
of 1986, as amended, or (iii) any entity whose underlying assets include plan   
assets by reason of a plan's investment in the entity to purchase the Notes, or 
to whom the Notes are transferred, will be deemed to have represented that the  
acquisition and continued holding of the Notes will be covered by a U.S.        
Department of Labor Class Exemption.                                            

                 The Depositor, the Servicer, the Indenture Trustee, the Owner
Trustee, the Insurer and the Note Registrar and any agent of the Depositor, the 
Servicer, the Indenture Trustee, the Owner Trustee, the Insurer or the Note     
Registrar may treat the Person in whose name this Note is registered as the     
owner hereof for all purposes, and none of the Depositor, the Servicer, the     
Indenture Trustee, the Owner Trustee, the Insurer, the Note Registrar nor any   
such agent shall be affected by notice to the contrary.                         

                 The recitals contained herein shall be taken as statements of
the Issuer and the Indenture Trustee assumes no responsibility for their        
correctness.                                                                    

                 Each Noteholder or Note Owner, by acceptance of a Note or, in
the case of a Note Owner, a beneficial interest in a Note covenants and agrees  
that no recourse may be taken, directly or indirectly, with respect to the      
obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the    
Notes or under the Indenture or any certificate or other writing delivered in   
connection therewith, against (i) the Unaffiliated Seller, the Depositor, the   
Servicer, the Indenture Trustee or the Owner Trustee in its individual capacity,
(ii) any owner of a beneficial interest in the Issuer or (iii) any owner,       
beneficiary, agent, officer, director or employee of the Unaffiliated Seller,   
the Depositor, the Servicer, the Indenture Trustee or the Owner Trustee in its  
individual capacity, any holder of a beneficial interest in the Issuer, the     
Unaffiliated Seller, the Depositor, the Servicer, the Owner Trustee or the      
Indenture Trustee or of any successor or assign of the Unaffiliated Seller, the 
Depositor, the Servicer, the Indenture Trustee or the Owner Trustee in its      
individual capacity, except as any such Person may have expressly agreed (it    
being understood that the Indenture Trustee and the Owner Trustee have no such  
obligations in their individual capacity) and except that any such owner or     
beneficiary shall be fully liable, to the extent provided by applicable law, for
any unpaid consideration for stock, unpaid capital contribution or failure to   
pay any installment or call owing to such entity.                               

                 Each Noteholder or Note Owner, by acceptance of a Note or, in
the case of a Note Owner, a beneficial interest in a Note covenants and agrees  
that by accepting the benefits of the Indenture that such Noteholder will not at
any time institute against the Unaffiliated Seller, the Depositor,              

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or the Issuer or join in any institution against the Unaffiliated Seller, the   
Depositor, or the Issuer of, any bankruptcy, reorganization, arrangement,       
insolvency or liquidation proceedings, or other proceedings, under any United   
States Federal or state bankruptcy or similar law in connection with any        
obligations relating to the Notes, the Indenture or the Basic Documents.        

                Prior to the due presentment for registration of transfer of
this Note, the Issuer, the Indenture Trustee and the Insurer and any agent of   
the Issuer, the Indenture Trustee or the Insurer may treat the Person in whose  
name this Note (as of the day of determination or as of such other date as may  
be specified in the Indenture) is registered as the owner hereof for all        
purposes, whether or not this Note be overdue, and neither the Issuer, the      
Indenture Trustee nor any such agent shall be affected by notice to the         
contrary.                                                                       

                 The term "Issuer" as used in this Note includes any successor
to the Issuer under the Indenture.                                              

                This Note and the Indenture shall be construed in accordance
with the laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder   
and thereunder shall be determined in accordance with such laws.                

                 No reference herein to the Indenture and no provision of this
Note or of the Indenture shall alter or impair the obligation of the Issuer,    
which is absolute and unconditional, to pay the principal of and interest on    
this Note at the times, place, and rate, and in the coin or currency herein     
prescribed.                                                                     

              Anything herein to the contrary notwithstanding, except as
expressly provided in the Indenture or the Basic Documents, none of Wilmington  
Trust Company in its individual capacity, any owner of a beneficial interest in 
the Issuer, or any of their respective beneficiaries, agents, officers,         
directors, employees or successors or assigns shall be personally liable for,   
nor shall recourse be had to any of them for, the payment of principal of or    
interest on, or performance of, or omission to perform, any of the covenants,   
obligations or indemnifications contained in this Note or the Indenture, it     
being expressly understood that said covenants, obligations and indemnifications
have been made by the Issuer for the sole purposes of binding the interests of  
the Issuer in the assets of the Issuer. The Holder of this Note by the          
acceptance hereof agrees that except as expressly provided in the Indenture or  
the Basic Documents, in the case of a Default or an Event of Default under the  
Indenture, the Holder shall have no claim against any of the foregoing for any  
deficiency, loss or claim therefrom; provided, however, that nothing contained  
herein shall be taken to prevent recourse to, and enforcement against, the      
assets of the Issuer for any and all liabilities, obligations and undertakings  
contained in the Indenture or in this Note.                                     

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ASSIGNMENT

                 FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto                                                            
                     -----------------------------------------------------------

-----------------------------(Please print or typewrite name, address including 
postal zip code, and Taxpayer Identification Number of assignee)                
                                                                ----------------

-------------------------------------------------------------------------- the  
within Note on the books kept for registration thereof, with full power of      
substitution in the premises.                                                   

                I (we) further direct the Note Registrar to issue a new Note
of like tenor to the above named assignee and deliver such Note to the following
address:                                                                        
------------------------------------------                      

Dated:                                                                          

                                    --------------------------------------------
                             Signature by or on behalf of assignor

                                    --------------------------------------------
            Signature Guaranteed

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PAYMENT INSTRUCTIONS

             The assignee should include the following for purposes of
distribution:                                                                   

             Payments 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     , as its agent.

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                                                                       EXHIBIT C

 FORM OF FINANCIAL GUARANTY INSURANCE POLICY

[See Separate Document]   

 C-1

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘8-K’ Filing		Date		First		Last			Other Filings
		8/15/29		78		82
		7/15/29		68		72
		3/31/00		44
		12/31/99		19					10-K,  10-K/A,  10-K405
		6/15/99		68		82
Filed on:		6/9/99							POS AM
		5/27/99		68		81			424B5,  8-K
For Period End:		5/1/99		1		82			8-K
		3/1/99		6
									List all Filings